March 12, 2004

EAST IS WEST:

The EU Is Choking Off Its New Blood: Barring workers from new member states will only prolong economic stagnation (John Rossant, 3/15/04, Business Week)

When George W. Bush recently proposed legalizing the status of up to 9 million illegal immigrants residing in the U.S., it reminded some Europeans of just how differently Americans approach the idea of pumping fresh blood into the workforce. "If any Prime Minister in Europe stood up in Parliament and announced something like that today," says Denis MacShane, Britain's Europe Minister, "he'd be dead in the water."

That sense of political expediency, paradoxically, is leading Europe's political leaders to shoot themselves in the foot, an area where they have few equals. Immigration fear is driving the region to miss out on its biggest chance for an energy infusion in years.

It's glaringly obvious that Europe's top priority is reversing its dismal economic record. Over the past decade, the euro zone's average annual growth rate has clocked in at an anemic 2.1%. So the idea of eight raring-to-go nations of ex-communist Eastern Europe entering the EU as full members on May 1 ought to be great news for growth. All those youthful, well-trained Czechs, Poles, and Latvians -- what better way to turbocharge Europe's aging, cosseted workforce?

Not if European politicians can help it. One by one, the Old Europe countries of the EU are slamming the door on the workers of the New Europe.


Eastern Europe belongs in NAFTA, not the EU.

Posted by Orrin Judd at March 12, 2004 5:28 PM
Comments

By keeping that young, well educated workforce cooped up in Eastern Europe, it increases the chances of both a "brain drain" to North America, and that the resources of those who stay will be utilized by American companies, revitalizing not the EU, but the US.

For example, between 1992 - 2002, US interests invested a total of $ 60 billion in Poland, a country with an annual GDP of $ 210 billion at current exchange rates.

However, Poland, regardless of its "glorious" past, is probably not the future of Europe.
It has negative population growth, net emigration, and a total fertility rate exactly the same as Japan's.

Posted by: Michael Herdegen at March 13, 2004 1:15 AM
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