MONEY MATTERS

Europe’s economic success is obvious even without statistics report. It has always been said that Europe has a stagnant economy in which taxes were high and generous social benefits have undermined incentives. Could anybody who has visited Europe claim it to be poor and backward? You have to believe your eyes and it is confirmed by the statistics.
Since the U.S. politics had taken a turn from 1980, the economic growth of the U.S. has been faster than that of Europe. But the population growth has also been faster. The living standards have grown at the same level at the U.S. and at Europe. In the late 1990s the information technology revolution in the U.S. was far more than in Europe but Europe has since caught up in so many ways, the broadband in Europe is as widespread as it is in the U.S. and much cheaper and faster.
The unemployment level in Europe is higher but they are very productive. They work fewer hours but their output per hour is close to the U.S. levels. Europe is also suffering from the economic crisis and some European countries are teetering on the edge of fiscal crisis. But taking the longer view European economy works; it grows and it is as dynamic as the U.S. economy.
Europe is often held up as a cautionary tale, a demonstration that if you try to make the economy less brutal, to take care of your fellow citizens when they are in bad luck, you end up killing economic progress. But what European experience actually demonstrates is that social justice and progress can go hand in hand.

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