Europe is behind because we do not have good leadership. The decisions taken by leadership, no matter what level you look at - local, company, national, supranational - are rarely in the best interest of Europeans. Our markets - housing, rental, labor, capital, pension - are broken and therefore the population does not find opportunities to express their talent completely and the more motivated migrate. Europeans lack well-paying jobs and pay is low because pay is not transparent.
Issues like raising funds easily or faster bankruptcy processing are not something an ordinary European citizen can solve. These are leadership issues. The proliferation of consultants means that management talent is never developed. Avoiding accountability is rewarded.
Consistently what could become common wealth in form of company is sold to private equity or sold to US. Friction in movement of information is sheer incompetence at leadership level.
For years blue-collar jobs were being moved to China, while white-collar jobs were being moved to US. And now the workers are being blamed for not working hard enough. It is never asked - is there work?
look at the massive popular protests when Macron tried to do pension reform. These are completely legitimate choices to make, they're your countries, but i do not think it's your leaders letting you down.
The sad thing about democratic societies it is difficult to form a consensus on anything. So elections are won on either emotions or the minimally contentious manifesto. Each successive win on such a manifesto further lowers what will achieve consensus.
People will mesmerizing oratory skills are extremely rare. That such individuals choose politics as their career and then come up with appealing messaging at the right time is almost like solving 3-body problem.
You imply representative democracy, where political parties are forced to be formed not to solve issues, but to win a popular vote. To win the vote, you have to dilute your policy enough to encompass the masses by providing many common denominators. There, consensus is impossible by design, we no longer live in a Greek metropolis, where the dimensionality of problems is low. Todays societies are complex and have many dimensions, yet the representative democracies group all of the similar and dissimilar issues under 2-3-4-5 different parties.
I see exactly two (one) solutions:
- people go beyond party boundaries and cooperate on issues they feel important (doesn't work, it's already possible on paper, but in the best case this ability is traded for negotiational power)
- direct voting on issues, parties only serve a directional and educational role
What fanfic am I reading here? The protests had no impact on the course of the pension reform.
Europe, and particularly the EU, is effectively governed by people who think like administrators. In politics, in business, and in the actual administration. On some level, this is a good thing. The core republican principle is that leaders should be disposable servants, because actual leaders never have the public's best interests in mind. Except maybe temporarily or by accident.
The problem is that administrators tend to propose administrative solutions to the issues they have identified. Because they think like administrators. Sometimes this works, and sometimes it doesn't. Most successes and failures of the EU can be traced back to this tendency to enact administrative solutions. There would be more successes and fewer failures if the administrators could somehow learn to predict when an administrative solution is not the right tool.
Housing markets, labor markets, and pension systems are regional, and the situation in each region is different. Capital markets are also regional to some extent, but perhaps they shouldn't be. Pay is a matter of perspective. You can say that Europeans lack well-paying jobs, or you can say that American middle class wages are low (relative to the wealth of the society), because their upper middle class wages are high.
The problem with creating a quota system is that you have to be able to punish countries who cheat on the quota. Europe doesn't have the capacity to do this except internally. The regulatory superpower idea only really makes sense with the physical power to compel obedience and extract taxes.
In the US we solved these issues like the bankruptcy code with federal law because the federal government is the supreme physical power on the continent that all the states obey for reasons of self-preservation and because they are bribed to obey. US federal transfers to individual states are also much, much larger than the largest EU transfers to member stats and the EU is not a central military or police power either.
This is why the EU member states (and the UK member states as well) should become US territories so that they can benefit from federal law without necessarily destabilizing domestic US politics. They are already dependent on US military power but they do not receive the full benefits of becoming member territories.
Our problem is incoherence and slow reaction to reality. We either often not experiment or avoid replicating a success. We lack agility in our rule making.
This is a very strange suggestion. The US federal government is not a beacon of best governance. And especially now with Trump, there won't be any takers for this.
On the other hand, the US is big time. We're always on the front page, and so Europeans of course begin to believe they know a lot about American politics and thoughts because they read about it all the time. That leads to outlandish understandings and expectations of the US and so even when you want to start looking at governance comparisons it's hard to have conversations because "defenders" of American systems don't know enough about the EU and European "defenders" of the EU think they know quite a bit about American politics. This leads to a lot of misunderstandings, unfortunately.
The reality is that both systems have pros and cons, and how good each system is really depends on individual circumstances, and even then those circumstances and pros/cons change over time.
To keep the fun part of the conversation going, I actually think the United States and the rest of the Anglosphere should join together in one bloc. Sometimes I fantasize about how different and perhaps better history would have turned out had the American Revolution not happened.
From recent events, I like giving example of Deutschland Ticket. The German transport minister during 2020/2021 took a huge political risk of challenging existing system, made life much more easier for normal person. What happened to his political career? The guy is nowhere to be seen.
Sounds like Europe is behind because Europeans are working less and taking more vacations. You just point to poor leadership as the cause.
Edit: I’ve recently started spending a lot of time in Switzerland and the contrast in mindset (and wealth) with the EU is staggering. There is a healthy amount of communal paranoia. They don’t work any harder either, if anything it’s the contrary.
Why is that a problem? Yes, it means less "amazing individuals who own N% of the economy", but it also means that none of my neighbors are starving or can't afford healthcare, definitively a tradeoff I (and most people I'm proud to call friends) are willing to make, even if it makes our own lives a small percentage less comfortable.
I'd say that why I personally prefer the (European) country over other places I've lived in the world, or could live. I don't want to live in a place where people don't help lifting all the boats, but instead are just interested in lifting their own boat, or want to lift a small amount of boats.
And that's amazing, and as an European I would never want to get rid of that. It's a cornerstone of our societies, a core belief if you want to call it that.
But I do think that there is a pervasive feeling of people being "ostracized" for wanting to do better than their neighbours. Like when someone says they are going to run a company the reaction is usually "why, isn't a normal job good enough for you?". Obviously this isn't universal, EU is far too big and diverse for this to be true everywhere. But I've met with this kind of attitude a lot personally, where people have directly asked me if I think I'm better than them by trying to do something good for myself and grow. So now I just don't tell people, or just say I work in software or something, there's no point. It's not even that tide lifts all boats, it's that "we're all in the same boat"(and don't you dare leave it) is a thing that exists.
But to be fair, I haven't really experienced that so much in other larger countries like Spain, France or Italy, at least not to that extent. Still I'd say it's different than the typical American Individual Exceptionalism, but probably a good difference, we don't to make the same mistake.
Probably a balance between the two is the right approach, you don't want to completely lack either sides, but also not be too dogmatic about it. But it's also hard for politicians to get votes on "You know, both sides have good points, lets figure out a balance", strong emotions sell votes and so on...
Even those who might accept this is no longer true intellectually find it hard to internalise.
The current complacency, one which we are currently still in the process of unwinding from (it will take years) is that of trade turning violent enemies into mutually beneficial growth opportunities. Russia was the first wake-up call there (but even then for the current situation not for Crimea), and over the last year also the USA. China is, I think, currently mostly seen as opportunity rather than threat.
War is expensive, and not doing it is good when possible. It is bad for everyone that we now feel the need to put 5% or whatever of our GDP into defence when it could have been spent on infrastructure, education, healthcare, or even startup grants.
Spending on defence is expensive, but its a lot cheaper than an actual war - "if you want peace, prepare for war"
Thats the only thing that works for the likes of russia (or anybody really) who is by far the biggest threat to Europe and would love to see it subjugated.
That was also the only reason Switzerland wasnt taken over by nazi Germany like Austria was, they mustered up to 800k voluntees/draftees in a country of 5 million, fortified and made it clear that Germany would bleed hard to gain that territory (they would invade anyway after defeating russia that was clear also from hitler&himmler's writings, top german brass hated Switzerland, what it represented and considered it a mortal enemy to 3rd reich but I am going off topic here).
5% is nothing if there is enough motivation. Overbuilt bureaucracy for nothing juse employing tons of rather useless paper pushers, ineffective social systems that are abused hard by those really not deserving it, bad budget management by politicians, corruption in megaprojects and ao on. Its really nothing.
The problems are security, sovereignty and economic stagnation. Being dependent on super powers and vulnerable to their whims is not good. Weak supply chains are not good. Neither are worsening standards of living.
You are proving the point. The avg. person gets an enormous benefit from it, even in countries like USA, Japan or Korea with far less generous welfare. The gap in standards of living of somebody in the US and somebody in Georgia or Vietnam are ridiculous.
How is this an argument? A poor person in the US has a massively better standard of living than a poor person in Vietnam.
Poverty is relative. If you have a small apartment in a city of McMansions, you're poor, but if you have a goat in a village of no goats, you're rich.
That worked before globalization. Nowadays, having a small apartment in a city of McMansions means you're upper middle class. Poor people in the west have no apartments and no goats.
What is equivalent adjusted income level? PPP between Russia and USA is around 1.8. Median annual salary in the US is $57 ($1196 per week), median salary in Russia is $13200. Even if you adjust it, it's roughly two times smaller.
As someone who lived in a bunch of countries, some rich and some poor, no, living standards among the avg. Joes of the world are not even remotely the same.
I choose to live in a richer country where I am relatively a lot poorer, but overall the advantages of a rich country outweigh the disadvantages.
Using money as a proxy doesn’t work perfectly because things can be more expensive, and trying to normalize with things like “living sq ft” doesn’t calculate externalities.
The best I’ve found is to track relative migration pressure - where do people want to go?
*compared using nominal exchange
>The best I’ve found is to track relative migration pressure - where do people want to go?
I like this approach. It's much more holistic and captures stuff that really cannot be quantified with prices and numbers, like freedoms and rights.
No, you need more than one goat if you want to be rich, regardless of what other people have. Really, you need a few dozen.
One goat can't do anything but age and die.
Poverty levels are measured relative to median. Poverty in US and poverty in Bangladesh, Russia or Vietnam are completely different things.
In the US poverty line is about $16k, while in Russia for example it is $2300. Even considering the PPP it's like 4 times the difference in living standards. I guess Vietnam or Bangladesh are far worse.
Upd: downvotes with no counterargument. Orange site is becomming more and more a reddit.
In Europe, innovation in the end help everyone. Better healthcare starts with the rich, and ends distributed to everyone. The same is true for everything else.
I wouldn't say it's a matter of complacency, but rather a convergence of problems. To solve those problems, there need to be radical changes, but radical changes are not popular. Politicians win elections by promising stability, not by disrupting lives. The politicians that rise to the top are the ones that don't have any visions for a better future nor the desire to make a difference, because the system does not reward that.
These boats may contain Tesla, Ramanujam, Röntgen and other talent people with poor circumstances.
Good social security is also investment in potential talent that could contribute to economy.
I disagree entirely. It's because most EU workers(at least in the richer most developed countries) don't get a proportional slice of the fruits of their labor, but only breadcrumbs after taxes. Working harder as an EU employee just means your boss/company gets to be richer and your government gets more of your taxes, while you get nothing more in return, just taking home a few extra bucks at the end of the month, making the juice not worth the squeeze, causing everyone to optimize for doing the bare minimum because why bother.
Especially when the big city CoL rises higher than your salary anyway, what's the point of working harder? You'll be more tired now and still won't be able to buy a nice house, ending up on the same standard of living and housing affordability as someone who optimized his life around extracting the most amount of welfare and benefits from the government while dodging work. So then why wouldn't you do the same?
Same story around entrepreneurship and VC funding or lack thereof. The taxes, risk and responsibilities of being a business owner with employees on your payroll are far higher that in other places on the planet like the US, making it a better deal to just not bother with all that and choose the cushy life of an employee in a old dinosaur company in an ageing and declining industry, rather than the stress of being the employer/innovator.
Geopolitical competition will not fix this because the monetary incentive structure around hard work still remains messed up. You can fix this by changing the tax laws to reward those working harder instead of punishing them with higher taxes and no gains to pay for the lifestyles of those who contribute the least in society.
Simply look at what Poland or Czechia did to become economic powerhouses in a short amount of time, and just do stuff like that. And you'll find out they didn't start off by giving their workers Scandinavian style of income taxes, welfare and benefits, that I can tell you, but more like cutthroat capitalism and the harder you work the more you can earn tax structures.
Our success story is the same as recent India one - we're just much smaller. We have educated population that was underemployed and poor, and western companies jumped at opportunity of replacing entry and mid level positions with cheaper workers, across both factory and office work.
At least that's the reason I've been given every time I've tried to take a contractor permanent!
Calling India a success story feels like a bit of a stretch compared to the better known Chinese case, or indeed Eastern Europe itself. They still have huge scope for further improvement.
If anything, big city CoL is the flip side of higher productivity inside the big city. If you're going to have an "idle" lifestyle, you'll be vastly better off moving to a small rural town where prices are a lot lower by default - same if you work fully remote. (Connectivity used to be a key barrier for the latter case, but fast mobile and sat-based connections have changed this quite dramatically.)
Productivity is only one of the smaller reasons. The other bigger ones are landlord rent seeking, nimbyism, mass migration, interest rates and real estate speculation, all of which aren't connected to your income progress. That's how productivity and employment in a city can stagnate or even decline while real estate prices can keep climbing.
You don't, (Western) Europe is just a rentier-place at this point, living on other people's backs. For example look at Maersk, from the much-beloved and relaxed Denmark, their business would crumble over night if it weren't for the Americans keeping the seas open for them.
USA is the only country that ever triggered article 5 of NATO and got military help out of it. And now acts like victims when others don't rush to help them with absurd badly planned war where they are clear aggressors.
The second real use of NATO was to send armies to greenland to discourage USA to attack it just 2 months ago. So, now is really not the time for America to pretend ever do something that is not primary for itself.
That was token help (the Brits excluded), let's be serious here, we're all grown-up men.
Lets be serious here.
My biggest issue is that we have focused for too long on managing (regulating) and redistributing wealth instead of creating new sources of wealth.
We are obsessed with slicing and controlling the pie instead of creating new ones for everybody.
That mindset might cost us the future of our children.
I am sure we can all argue about where that point is, but I wonder if we agree that there is such a point? Or do we have to keep increasing our wealth forever?
Look at the auto industry for example.
If Chinese decide to invest into EVs etc. we can't stand on the side lines and so, no we want the world / our wealth to stay like it is.
But that's how we operate. We operate as if we have decided it's enough, now everybody please stop.
Junior doctors across Europe reported working an average of 57 ± 17 hours per week (216 ± 61 hours per month)[0].
[0]: https://www.juniordoctors.eu/assets/rest-report-DeLrwvob.pdf
Agreed otherwise, the essay is great.
It’s a lot easier for a business in one US state to expand to another one, but cross border business expansion in EU is still difficult.
People speak different languages, bureaucracy is different and often in a different language as well etc.
On top of that businesses are a lot more regulated than in the US.
I am honestly curious who you are pointing at (in particular if you exclude British leaders)
Partly because I am actually curious, I don't doubt there are bad leaders.
But partly also because, without any details, this is a very general trope, that I don't really think is very healthy at the moment. Since it is food for right wing extremists (you probably know yourself where some politicians in USA originate from).
bad policies: massive tariffs, extreme spend of the military-industrial complex at the cost of education and healthcare, a completely pointless War on Drugs that just increases violence (to be fair, many states have more or less legalized cannabis at this point), war in foreign countries (if all the money spent of Afghanistan had just been distributed back to American taxpayers in the form of either tax cuts of stimulus checks, how might that have affected the economy?)
bad leaders: I think most historians would agree that president Trump is not exactly Mount Rushmore material
bad deployment of capital: at the state level, this would mirror 'bad policies', ie I don't think war the Afghanistan/war on drugs was a net gain for the US taxpayer. On the private side, the boom/bust nature of tech investments - how many were buying Pets.com stock in 1998? How many people bought trendy NFTs in 2019? How many completely unviable businesses get funded today just because "our product has AI"?
so there might be other factors.
In DE I would argue that this is due to punitive taxes and I wouldn't call it progress.
Poor people work their asses 40+ hours and up to overwork since it's always paid here. White collars work less time and often switch to 4 days because at this tax progression working your ass is not worth it. Time is more valuable, indifference curve is screwed.
It also have negative effect on women's careers in combo with 3/5 tax classes thing. And it hurts EU economies very hard since the most productive ones are disincentivized to work more.
It seems to me like in Germany, the rock bottom is high but the glass ceiling is low. I am very happy with this, but if you are nearer to the ceiling, it can feel cramped.
I'm not. If you are european and will inherit something it's fine, but if not you'll barely be able to afford a house and a tiny investment portfolio. And at the face of the immense collapse of a pension system it's pretty grim.
If it makes you feel better, the pension system is collapsing everywhere. The scarier part is how we will find the workforce to care for us, but I digress.
Does more white collar work beyond a threshold produce more value, anyway? Sometimes yes but often no.
Yes bc now this worker works same 3-4 hours but 4 days instead of 5.
UK workplaces where much more relaxed in comparison so even though people put in more hours the results were similar.
as someone who spends a lot of time in Spain but lives in the US, the Spanish prioritize social interaction much more than the US (sweeping statement I know) - you go to many towns and cities in Spain and locals are socializing multiple nights per week in vibrant bars and cafes an having so much fun. London has a bit of this with pub culture but less family friendly.
The US on the other hand, the focus is on work and friends rarely get together and we study why people are socializing less (bowling alone etc. ).
I do see more people with higher wages chose more for time off than more money, and work 4 days for example..But the majority of the population does not fit that category i think. (i dont have the exact numbers, but most jobs are not high income in general)
> (Honest disclaimer: I am talking here solely about my white collar bubble, no idea about blue collar to be honest. Not much contact with people from that field unfortunately)
Even ignoring your "BUT! Is this a survival strategy? While [...]" point - try talking to the farmers and blue collar workers upon whom your day-to-day life is critically dependent.
I don't think idleness is what's preventing it anyway. It's more about capital ownership. I'm not deploying high speed rail because I expect it would be impossible to get the land rights, not because I wouldn't work enough hours.
Actually I myself would be a terrible entrepreneur in any field, but I feel that I produce good value at a good rate at the actual work that I do. I don't think there's a shortage of entrepreneurship even though I happen to have none. I do think it's not being deployed on things that make the country more powerful.
You mean 36h in a full time employment contract or by self reported work hours or is it part time work?
> I am talking here solely about my white collar bubble
Well from where I am in the EU and across other people I know in EU, for white collar jobs 40h contract is the norm in most places for most people I know. 36h is kind of an exception in select few fields in certain high-welfare countries with strong unions(German IG-metal for example in Germany, Airbus in France, etc), so you could simply be biased by a privileged bubble that isn't the norm in all of Europe.
During the financial crises Greeks were getting a lot of criticism from Northern Europeans for being lazy but the reality was they did far more hours.
It really depends on your bubble but a lot of people have "full time" contracts (meaning 40-ish hours) but real hours vary. You can come later, leave earlier, go do something else in the day, and don't have to report it to anyone. Just make sure you're not missing a meeting and deliver what's needed on time. So in practice you end up working fewer hours on average, as long as you can produce enough on average (which honestly isn't hard in many large organisations, and hard to measure).