June 10, 2004

MISSISSIPPI, YOU'RE ON MY MIND (via Mike Daley):

EU versus USA (Fredrik Bergström and Robert Gidehag, 2004-06-02, Timbro)

If the European Union were a state in the USA it would belong to the poorest group of states. France, Italy, Great Britain and Germany have lower GDP per capita than all but four of the states in the United States. In fact, GDP per capita is lower in the vast majority of the EU-countries (EU 15) than in most of the individual American states. This puts Europeans at a level of prosperity on par with states such as Arkansas, Mississippi and West Virginia. Only the miniscule country of Luxembourg has higher per capita GDP than the average state in the USA. The results of the new study (PDF) represent a grave critique of European economic policy.

Stark differences become apparent when comparing official economic statistics. Europé lags behind the USA when comparing GDP per capita and GDP growth rates. The current economic debate among EU leaders lacks an understanding of the gravity of the situation in many European countries.


Yeah, but their poverty is more equally distributed than our wealth.

Posted by Orrin Judd at June 10, 2004 11:16 AM
Comments

That simple shows the misleading use of statistics. I lived briefly in Europe. All of these "poor" states have much higher living standards than Mississippi or West Virginia.

You shouldn't let statistics overwhelm common sense.

Posted by: Chris Durnell at June 10, 2004 11:23 AM

Chris:

You're citing the same examples. No one doubts that Europe is similar to West Virginia. Of course, Europeans move to W VA and not vice versa.

Posted by: oj at June 10, 2004 11:48 AM

Mississippi has better food and better music. MS gave us Robert Johnson and the Delta Blues. What's France given us?

Posted by: Governor Breck at June 10, 2004 12:49 PM

Yes, the low end of the scale of livelihood may be lower in WV than in Europe..but I'm willing to bet home ownership--especially the relatively large size of the average WV spread, mulitple automobile ownership, boat ownership, i.e. measures of REAL wealth are all higher in WV than in Europe.

Posted by: cornetofhorse at June 10, 2004 1:00 PM

You have to be a little careful making too direct comparisons of personal wealth. Many Euros drive expensive cars like Volvos and Mercedes' because they can deduct some portion of payments on domestic made cars from taxes. But many of those Volvo drivers ration their family meat days and almost never go out to dinner unless it is a business expense.

Of course, when challenged on this, they stick their noses in the air and talk about how they don't want many of the things North Americans buy. More cultured, you know.

Posted by: Peter B at June 10, 2004 1:20 PM

Governor Breck:

French letters?

Posted by: Rick T. at June 10, 2004 1:43 PM

Governor Breck:

Nonstick pans and mayonaise. (French fries, of course, are Greek).

Posted by: mike earl at June 10, 2004 2:05 PM

It would make better sense to compare class to class. For all its equalization, Europe is still a class-based society.

It's true, for example, that Europeans pay, say, college professors a lot less than Americans do; but Orrin thinks we pay them too much.

So I'm confused. Is Europe better or worse?

Posted by: Harry Eagar at June 10, 2004 2:09 PM

Peter:

Last I saw, America had just passed two cars per household--does Europe have one per?

Posted by: oj at June 10, 2004 2:41 PM

GDP is gross domestic product right? Some we know this means Europe makes do with much less per person no matter what examples you pick or what any one person has or buys.

Posted by: andy at June 10, 2004 3:15 PM

Andy
You're right GDP means Gross Domestic Product, and I assure no one is grosser than Americans.

D*mn right.

Posted by: h-man at June 10, 2004 4:01 PM

OJ, yes I'm citing the same examples because I'm refuting them. No one who has lived or been through West Virgina/Mississippi and also western European states would ever say that WV/MS is on par with Europe. France, Germany, and northern Italy (but not the Mezzogiorno) all have a higher standard of living than those states.

I've heard horror stories about Britain's health system, but my own experience using the German one and examples I've seen on the French all indicate they are good. And it's acceessible to average people. The elite in America have better medical, but I doubt someone from a WV coaltown has anything like Europe.

I don't know car ownership stats, but suspect they are lower than America. However, one can get around Europe much easier without a car than someone in the states could. We need cheap cars and higher ownership, the Europeans don't because of a higher population density and excellent transit systems. Even OJ was complaining a few times about how the expansion of freeways was inherently unconservative, and he advocates higher gas taxes like the Europeans do. The European transportation system is not equivalent to America's, but that's a qualitative difference, it does not mean their system hurts their ability to move where they need to go.

Europe may not have big homes like America, but again that's a function of population density, not prosperity. But increased density also has benefits. I used to live in Bloomington/Normal, IL. When I was in Europe, I lived in Freiburg, Germany. Both are towns of about 100,000 people. Yet B/N sucked for amenities, and Freiburg had a ton of stuff to see and do (for the same reason Seattle has more amenities than Phoenix.) I would much rather live in a Freiburg-like town than in B/N. You could argue that Americans fled high density cities to live in the suburbs, but that was to get away from crime, not density. My parents did that. But my sister and many friends are heading into the city and gentrifying it in order to get the amenities density provides.

Europe definitely has economic problems, but to say it is less prosperous than WV or MS is preposterous.

Posted by: Chris Durnell at June 10, 2004 8:18 PM

Governor Breck:

Escargot, deconstructing Camus, and not bathing.

Posted by: Ken at June 10, 2004 8:44 PM

"Europe definitely has economic problems, but to say it is less prosperous than WV or MS is preposterous."

Wait twenty years.

In fifty years, we'll be comparing the European economy to Mexico's, and not favorably.

Posted by: Michael Herdegen at June 10, 2004 9:57 PM

Mixed bag.

Try buying a crane. You'll get an Austrian one, because their crane technology is 50 years ahead of ours.

Posted by: Harry Eagar at June 11, 2004 1:26 AM

Harry:

Sure, and the best wind turbines are Danish.
Denmark is the hub of global wind power development, where manufacturers, suppliers, research and educational institutions combine expertise and innovation.

I also expect France to continue making fine wines, and Germany fine automobiles.

However, the health and dominance of any one industry isn't enough to continue to propel an entire economy, unless that industry is large enough to employ almost everyone.

Posted by: Michael Herdegen at June 11, 2004 3:23 AM

Michael:

Germany doesn't make fine cars anymore nor France the best wines.

Posted by: oj at June 11, 2004 8:22 AM

Govenor Breck:

Creamy Sauces? Snooty Waiters? The Statue of Liberty. I think I've covered everything.

Posted by: Bartman at June 11, 2004 9:23 AM

I once visited with a full professor at a well-funded polytech. in Switzerland when I was working
at a University. This fellow and his family of
four lived in an apartment smaller than the places
most American college students live (he was probably around 40). I think they never planned
on owning a home. It was actually kind of sad how
his wife had little pictures of old New England
homes hung on the walls of this apartment. She told me that this was here ideal type of home and
knew she could never have it in Europe.

They loved visting Quebec and New England (they
were Francophone) and despite its beauty Swiss towns are cramped since the Swiss policy (like Vermont's) guves more livingspace to cows and chickens than to people.

There is still an unwritten feudal system in Europe that keeps people in their place. Even
Jolly old England keeps the middle class in ticky-tacky little semi-detached houses. While the
countryside is empty. The European elites are
horrified at the freedom of movement and the lifestyle choices available to Americans and they
understand what such choices would do to them.

Posted by: J.H. at June 11, 2004 10:36 AM

"Germany doesn't make fine cars anymore nor France the best wines."

You surely jest.

I dunno about the "best" wines, but of course they make fine wines, and perhaps more to the point, fast-selling expensive wines, even if some California and Australian vintages are superior.

Other than the Japanese, who makes a finer auto than the Germans ?

Posted by: Michael Herdegen at June 11, 2004 4:31 PM

Michael:

The South Koreans and even us.

Posted by: oj at June 11, 2004 4:33 PM

Michael, you are correct about individual industries, but as long as a society is able to stay in front in important ones -- cranes don't get much respect but are important nevertheless -- they're competitive.

The US doesn't make TV sets any more, though in 1980 or thereabouts, I attended a lecture by the technical head of RCA in which he vowed to keep up with the Japanese.

Does that mean the US economy is uncompetitive?

Europe as a whole registered more patents than the US last year -- a lot more.

Posted by: Harry Eagar at June 11, 2004 8:34 PM

But patents don't mean anything. Inventing new things is important, part of the Knowledge economy. Tweaking the details is best left to mere manufacturing economies.

Posted by: oj at June 11, 2004 8:40 PM

...and just what are parts of the foundation of current European wealth and their welfare state? Colonialism, security largely paid for by US taxpayers, help rebuilding after WWII with US taxpayer money, others?? Would the current state of Europe be possible without the US and centuries of exploiting much of the rest of the world?

Posted by: mark at June 11, 2004 9:20 PM

Porsche, BMW, Mercedes, Audi. Fine doesn't begin to say how excellent those cars are.

Porsche, BTW, may well be the most profitable car manufacturer in the world.

Posted by: Jeff Guinn at June 11, 2004 9:30 PM

That's the image, not the reality:

http://www.aiada.org/article.asp?id=11055

Posted by: oj at June 11, 2004 9:41 PM
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