Symptom Of Decay

So many people I know on the left gaze wistfully at tokens of their various times in Europe; "I wish I were there", they whisper longingly.

I can relate. I loved the time I spent over there, and would love to go back. But I suspect we're reflecting on different things; I on the people I met and the adventures I had, they on all of those plus, I suspect (and have been told) the neo-lib nirvana that European "social democracy" has created.

Not so fast, says David Brooks:

Anybody who has lived in Europe knows how delicious European life can be. But it is not the absolute standard of living that determines a people's morale, but the momentum. It is happier to live in a poor country that is moving forward - where expectations are high - than it is to live in an affluent country that is looking back.

Right now, Europeans seem to look to the future with more fear than hope. As Anatole Kaletsky noted in The Times of London, in continental Europe "unemployment has been stuck between 8 and 11 percent since 1991 and growth has reached 3 percent only once in those 14 years."

The Western European standard of living is about a third lower than the American standard of living, and it's sliding. European output per capita is less than that of 46 of the 50 American states and about on par with Arkansas. There is little prospect of robust growth returning any time soon.

Once it was plausible to argue that the European quality of life made up for the economic underperformance, but those arguments look more and more strained, in part because demographic trends make even the current conditions unsustainable. Europe's population is aging and shrinking. By 2040, the European median age will be around 50. Nearly a third of the population will be over 65. Public spending on retirees will have to grow by a third, sending Europe into a vicious spiral of higher taxes and less growth.

As the new mini-phenomenon of the economic refugee from Europe becomes more predominant - especially among the middle class - it'll be interesting to watch Europe for the next thirty years.

To say the least.

Posted by Mitch at June 2, 2005 12:21 PM | TrackBack