Europe’s Secret Success
Paul Krugman, NYT
MAY 25, 2014
SINTRA, Portugal — I’ll be spending the next couple of days at a forum sponsored by the European Central Bank whose de facto topic — whatever it may say on the program — will be the destructive monetary muddle caused by the Continent’s premature adoption of a single currency. What makes the story even sadder is that Europe’s financial and macroeconomic woes have overshadowed its remarkable, unheralded longer-term success in an area in which it used to lag: job creation.
What? You haven’t heard about that? Well, that’s not too surprising. European economies, France in particular, get very bad press in America. Our political discourse is dominated by reverse Robin-Hoodism — the belief that economic success depends on being nice to the rich, who won’t create jobs if they are heavily taxed, and nasty to ordinary workers, who won’t accept jobs unless they have no alternative. And according to this ideology, Europe — with its high taxes and generous welfare states — does everything wrong. So Europe’s economic system must be collapsing, and a lot of reporting simply states the postulated collapse as a fact.
The reality, however, is very different. Yes, Southern Europe is experiencing an economic crisis thanks to that money muddle. But Northern European nations, France included, have done far better than most Americans realize. In particular, here’s a startling, little-known fact: French adults in their prime working years (25 to 54) are substantially more likely to have jobs than their U.S. counterparts.
It wasn’t always that way. Back in the 1990s Europe really did have big problems with job creation; the phenomenon even received a catchy name, “Eurosclerosis.” And it seemed obvious what the problem was: Europe’s social safety net had, as Representative Paul Ryan likes to warn, become a “hammock” that undermined initiative and encouraged dependency.
(More here.)
MAY 25, 2014
SINTRA, Portugal — I’ll be spending the next couple of days at a forum sponsored by the European Central Bank whose de facto topic — whatever it may say on the program — will be the destructive monetary muddle caused by the Continent’s premature adoption of a single currency. What makes the story even sadder is that Europe’s financial and macroeconomic woes have overshadowed its remarkable, unheralded longer-term success in an area in which it used to lag: job creation.
What? You haven’t heard about that? Well, that’s not too surprising. European economies, France in particular, get very bad press in America. Our political discourse is dominated by reverse Robin-Hoodism — the belief that economic success depends on being nice to the rich, who won’t create jobs if they are heavily taxed, and nasty to ordinary workers, who won’t accept jobs unless they have no alternative. And according to this ideology, Europe — with its high taxes and generous welfare states — does everything wrong. So Europe’s economic system must be collapsing, and a lot of reporting simply states the postulated collapse as a fact.
The reality, however, is very different. Yes, Southern Europe is experiencing an economic crisis thanks to that money muddle. But Northern European nations, France included, have done far better than most Americans realize. In particular, here’s a startling, little-known fact: French adults in their prime working years (25 to 54) are substantially more likely to have jobs than their U.S. counterparts.
It wasn’t always that way. Back in the 1990s Europe really did have big problems with job creation; the phenomenon even received a catchy name, “Eurosclerosis.” And it seemed obvious what the problem was: Europe’s social safety net had, as Representative Paul Ryan likes to warn, become a “hammock” that undermined initiative and encouraged dependency.
(More here.)
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