RKMBs Forums .::Important::. Politics and Current Events Europe’s Not Working

the economies of the major countries on the European continent are basket cases: They produce the unemployed by the millions. Even more frightening, European economies are creating a new kind of stratified society, in which a substantial and growing minority is shut out from the labor market permanently through absurdly high minimum-wage requirements and overly strict regulations (like the employment protection laws that can make it almost impossible to fire people).


The syndrome has not blighted all European countries equally—parts of Eastern Europe, and some Western European countries, are healthier than the norm. But in the three countries with the largest economies—France, Germany, and Italy— stagnation, joblessness, and low or no growth are now facts of life. Together, these Big Three countries account for about three fifths of the Euro Zone’s economic output, and they are not healthy—and haven’t been for years.

...there is not much hope that continental Europe will catch up economically any time soon. There are three reasons for this sad judgment: First, the economic woes of large parts of Europe are so serious that no quick fix can cure them. Second, the real reasons for the problems (suffocated domestic markets) have not been understood fully even among reform-minded Europeans, despite a quarter century of never-ending debates. Third, even if reformers managed to agree on a comprehensive platform of economic changes and pushed hard for it, they would meet overwhelming resistance from a majority of Europeans. To put it bluntly: Most French, German, and Italian voters simply refuse to accept the necessity of a Thatcher/ Reagan-style economic revolution. Things will have to get even worse before many Europeans realize the depth of their countries’ stagnation.

Adjusted for differences in price levels, per capita income in the United States now exceeds France by close to 40 percent. Germany and Italy lag even further behind.

If labor productivity in Germany and in the U.S. continues on the same path as from 1996 to 2003, per capita income in Germany will grow by only 44 percent by the time American incomes double in 2026. Put differently, within a generation, Americans will enjoy twice the economic status that Germans do.

When economic performance got bad enough in a number of European countries in the recent past, majorities decided they were ready to change course. A good example is ... Ireland, not too long ago one of the poorest countries in Europe. After decades of struggling under socialist-influenced economic nostrums, it made a sweeping move toward the American model— cutting taxes and regulations, and inviting many U.S. corporations to set up bases under business-friendly conditions. Ireland exploded in prosperity, and today enjoys a per capita income about 20 percent higher than in France or Germany.


On the European continent, the Netherlands has made some sensible policy changes. So has Denmark. The government there has maintained fairly high unemployment benefits, but it has made it easier for employers to fire employees; and gotten tough on people who receive welfare benefits yet don’t actively look for jobs. The result is a labor market that is more Americanized than any other in continental Europe, and an unemployment rate at or below U.S. levels.


So, not all Europeans are terminally resistant to sensible economic reforms. There is no insurmountable reason why France, Germany, and Italy couldn’t move toward new policies as well.


Unfortunately, economic results on the continent may have to get even uglier before a majority of citizens recognizes the foolishness of the path they are now on. For the time being, most Europeans still display the same mindset that Lord Palmerston summed up when he is to have said to Queen Victoria: “Change? Change? Why do we need change? Things are quite bad enough already!”

Torben Hansen, who has cerebral palsy, which severely affects his speech and mobility, believes his local authority should pay the extra charge he incurs when he hires a sex worker - because his disability means he cannot go to see them. His case is currently being considered.

In Denmark, local authorities compensate disabled people for extra costs incurred because of their disability.

"I want them to cover the extra expenses for the prostitutes to get here, because it's a lot more expensive getting them to come to my home rather than me going to a brothel," Mr Hansen told BBC World Service's Outlook programme.

"It's a necessity for me. I can't move very well, and it's impossible for me to go there."

'Unfair'

In Denmark, prostitution and other forms of sex work are not illegal so long as it is not a woman's sole means of income.

Mr Hansen started seeing a prostitute after attending a course at a social centre.

There, he and other disabled people were taught that if they had needs, they "could do something about it".

"I had a strong desire to have sex, and I think I gained the confidence around that time to get the call girls to come to me.

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Besides, growth is not sustainable in the long term. Something about resource depletion increasing exponentially. Do the math. It's kind of a varient of the Malthusian Delima.

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First Amongst Daves said:

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Besides, growth is not sustainable in the long term. Something about resource depletion increasing exponentially. Do the math. It's kind of a varient of the Malthusian Delima.

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Well, this is interesting. Wat makes you say economic growth is not sustainable? You postulate limited resources?

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First Amongst Daves said:
It definitiely did.

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Nowhereman said:
In fact from my memories of those years,unemployment hit a record high,something which has not been achieved since.
The Thatcher years were great for the upper classes & money men,but for the working class it was a nightmare.

I would like to know what this great revolution was that that article talks about.

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JQ said:
Fucking Roy Batty

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magicjay38 said:

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First Amongst Daves said:

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Besides, growth is not sustainable in the long term. Something about resource depletion increasing exponentially. Do the math. It's kind of a varient of the Malthusian Delima.

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Well, this is interesting. Wat makes you say economic growth is not sustainable? You postulate limited resources?

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You're right. I got the explanation wrong but I still stand by the limitations of growth. As resources are consumed they are replaced by less desirable substitutes, 'marginal lands' in Malthus' words. The supply curve grows steep, shifts upward and in, because marginal costs are rising and there are finite amounts of resources available. Extrapolating on Malthus' theory, resources grow arithmetically while population grows exponentially, frustrating the ability of supply to meet demand.

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First Amongst Daves said:
Tories often argue that Blair is reaping the benefits of Thatcher's economics.

I think that's probably right, but that's little consolation to those people who lived in despair in the 80s in England.

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magicjay38 said:

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First Amongst Daves said:

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Besides, growth is not sustainable in the long term. Something about resource depletion increasing exponentially. Do the math. It's kind of a varient of the Malthusian Delima.

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Well, this is interesting. Wat makes you say economic growth is not sustainable? You postulate limited resources?

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You seen a lot of planetary expansion lately? Earth is a closed system. Go to your micro econ text. Read that part about marginal cost and marginal utility.
Or research Robert Malthus and the Malthusian Delima.

You're right. I got the explanation wrong but I still stand by the limitations of growth. As resources are consumed they are replaced by less desirable substitutes, 'marginal lands' in Malthus' words. The supply curve grows steep, shifts upward and in, because marginal costs are rising and there are finite amounts of resources available. Extrapolating on Malthus' theory, resources grow arithmetically while population grows exponentially, frustrating the ability of supply to meet demand.

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Again, why are there only limited resources available?

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In the cradle of Western civilization, the cradles are empty. From the Atlantic to the Urals, in good and bad economies, in Protestant and Catholic societies, the countries of Europe are witnessing an unprecedented decline in birthrates.

This "baby bust," analysts warn, will affect economic growth, social-welfare programs, patterns of immigration and Europe's ability to pull its weight diplomatically, culturally and militarily in the 21st century.

The dearth of babies, coupled with longer life spans for today's elderly, "have major implications for our prosperity, living standards and relations between the generations," according to a "green paper" on demographic change issued by the European Commission earlier this year.

With fewer younger workers in Europe supporting more older pensioners, the immediate worry has been the fate of generous welfare and social protection systems across the continent.

The United Nations, the Organization for Economic Cooperation and Development and even the CIA have published major studies on the economic and social consequences of Europe's baby bust.

The CIA analysis generated headlines across the continent with apocalyptic warnings that Europe's social safety structures face collapse in a little more than a decade if the demographic meltdown is not addressed.

"The current EU welfare state is unsustainable and the lack of economic revitalization could lead to the splintering or, at worst, disintegration of the EU, undermining its ambitions to play a heavyweight international role," according to the forecast released in January.

Even Pope Benedict XVI has weighed in on the population drain in an August address, saying the decline in birthrates in Europe "has deprived some nations of the freshness, the energy, the future embodied in children."

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the G-man said:
Europe's 'baby bust' signals major change

In the cradle of Western civilization, the cradles are empty. From the Atlantic to the Urals, in good and bad economies, in Protestant and Catholic societies, the countries of Europe are witnessing an unprecedented decline in birthrates.

This "baby bust," analysts warn, will affect economic growth, social-welfare programs, patterns of immigration and Europe's ability to pull its weight diplomatically, culturally and militarily in the 21st century.

The dearth of babies, coupled with longer life spans for today's elderly, "have major implications for our prosperity, living standards and relations between the generations," according to a "green paper" on demographic change issued by the European Commission earlier this year.

With fewer younger workers in Europe supporting more older pensioners, the immediate worry has been the fate of generous welfare and social protection systems across the continent.

The United Nations, the Organization for Economic Cooperation and Development and even the CIA have published major studies on the economic and social consequences of Europe's baby bust.

The CIA analysis generated headlines across the continent with apocalyptic warnings that Europe's social safety structures face collapse in a little more than a decade if the demographic meltdown is not addressed.

"The current EU welfare state is unsustainable and the lack of economic revitalization could lead to the splintering or, at worst, disintegration of the EU, undermining its ambitions to play a heavyweight international role," according to the forecast released in January.

Even Pope Benedict XVI has weighed in on the population drain in an August address, saying the decline in birthrates in Europe "has deprived some nations of the freshness, the energy, the future embodied in children."

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Yawn....
Heard it. About ten years ago. Nothing new from the agencies or Ratzo.

BTW Europe bashers. When the EUR came out it traded as low .75 v. USD. Yet today, despite the turmoil in France, it closed Weds, 11-23-05 at 1.17. after a high for the year of 1.39. Yup, sounds like the EU is on it's last legs!

Russian President Vladimir Putin has inadvertently spotlighted one of today's momentous mysteries: collapsing birthrates in industrialized countries. Putin proposed that Russia pay women to have children to remedy a "critical" population outlook. Actually, he might have said "desperate." In 2000 Russia's population totaled almost 147 million; Putin says it's declining by 700,000 a year. With plausible assumptions, the U.S. Census Bureau projects it at 111 million in 2050. The median age (half the population above, half below) would be almost 50, up from 38 now. Could this Russia maintain a strong economy, national optimism or a capable military?

Russia's case, though extreme, isn't isolated. There's no more population "explosion." In wealthier countries, motherhood is going out of style and plunging birthrates portend population loss.

One way or another, the side effects will be massive for economics, politics and people's well-being. Indeed, they may already have started. Is it a coincidence that Germany and Italy, two countries on the edge of population decline, are so troubled?

On average, women must have two children for a society to replace itself. The number of children per woman is called the "total fertility rate," or TFR. Here are the estimated 2005 TFRs for some major countries: Germany, 1.4; Greece, 1.3; Italy, 1.3; Japan, 1.4; Spain, 1.3; and Russia, 1.3. Low fertility rates don't instantly lead to population declines. They can be offset by immigration, longer life expectancies and greater numbers of young mothers. But ultimately low fertility rates suggest falling populations.

Children are now usually a conscious choice -- whereas they were once considered economic necessities or religious obligations. Somehow American society better mixes child rearing and jobs than do other societies that provide greater child subsidies (government day care, family allowances).

Among experts, there is much skepticism that Putin-like economic incentives alone will revive fertility rates. By not having children, people are voting against the future -- their countries' and perhaps their own. It is easy to imagine the sacrifices and disappointments of raising children. It is hard, try as people might, to imagine the intense joys and selfish pleasures. People ignore Adam Smith's keen insight: "The chief part of human happiness arises from the consciousness of being beloved."

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magicjay38 said:

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First Amongst Daves said:
Tories often argue that Blair is reaping the benefits of Thatcher's economics.

I think that's probably right, but that's little consolation to those people who lived in despair in the 80s in England.

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magicjay38 said:

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First Amongst Daves said:

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Besides, growth is not sustainable in the long term. Something about resource depletion increasing exponentially. Do the math. It's kind of a varient of the Malthusian Delima.

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Well, this is interesting. Wat makes you say economic growth is not sustainable? You postulate limited resources?

---

You seen a lot of planetary expansion lately? Earth is a closed system. Go to your micro econ text. Read that part about marginal cost and marginal utility.
Or research Robert Malthus and the Malthusian Delima.

You're right. I got the explanation wrong but I still stand by the limitations of growth. As resources are consumed they are replaced by less desirable substitutes, 'marginal lands' in Malthus' words. The supply curve grows steep, shifts upward and in, because marginal costs are rising and there are finite amounts of resources available. Extrapolating on Malthus' theory, resources grow arithmetically while population grows exponentially, frustrating the ability of supply to meet demand.

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Again, why are there only limited resources available?

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The Earth is a finite system. That is the ultimate reason. Declining marginal utility of substitute resources. Malthus, writing in the 1820 used the example of declining utility of marginal lands. It's textbook micro economics. If you have a text, see marginal utility and marginal cost.

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In Summer 2004, at the very time that the New York Times was declaring poverty in Europe "abolished," the streets of Paris were already bearing ample witness to what has become an explosion in homelessness.

On New Year's Eve 2005-2006, a Paris resident launched a photo blog, ironically titled "The French Social Model", documenting the phenomenon.

To date, "The French Social Model" contains some 397 photos of homeless people on the streets and in the subways of Paris.

The German author Henryk M. Broder recently told the Dutch newspaper De Volkskrant (12 October) that young Europeans who love freedom, better emigrate. Europe as we know it will no longer exist 20 years from now. Whilst sitting on a terrace in Berlin, Broder pointed to the other customers and the passers-by and said melancholically: “We are watching the world of yesterday.”

Europe is turning Muslim. As Broder is sixty years old he is not going to emigrate himself. “I am too old,” he said. However, he urged young people to get out and “move to Australia or New Zealand. That is the only option they have if they want to avoid the plagues that will turn the old continent uninhabitable.”

Many Germans and Dutch, apparently, did not wait for Broder’s advice. The number of emigrants leaving the Netherlands and Germany has already surpassed the number of immigrants moving in. One does not have to be prophetic to predict, like Henryk Broder, that Europe is becoming Islamic. Just consider the demographics. The number of Muslims in contemporary Europe is estimated to be 50 million. It is expected to double in twenty years. By 2025, one third of all European children will be born to Muslim families. Today Mohammed is already the most popular name for new-born boys in Brussels, Amsterdam, Rotterdam, and other major European cities.

This article also addresses the inability and disinterest of secularist cultures (not, mind you secular governments, but the culture of the secular elite) to fight to keep what they have: In a recent op-ed piece in the Brussels newspaper De Standaard (23 October) the Dutch (gay and self-declared “humanist”) author Oscar Van den Boogaard refers to Broder’s interview. Van den Boogaard says that to him coping with the islamization of Europe is like “a process of mourning.” He is overwhelmed by a “feeling of sadness.” “I am not a warrior,” he says, “but who is? I have never learned to fight for my freedom. I was only good at enjoying it.”

“If faith collapses, civilization goes with it,” says [Tom] Bethell. That is the real cause of the closing of civilization in Europe. Islamization is simply the consequence. The very word Islam means “submission” and the secularists have submitted already. Many Europeans have already become Muslims, though they do not realize it or do not want to admit it.

People, particularly the hardline secularists, do not want to admit it but America is going to be forced to play things out on both a secular and supernatural stage, if she is going to stay alive, and not just alive but comprehensively American. Those, like Rosie O' Donnell, who would lump the Taliban and American Christians into the same boat do not realize that in doing so they are consigning themselves to Europe's fate. And Europe is dying. Europe will not fight.

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the G-man said:
Diagnosing Death Through Demographics (Europe in Crisis)

The German author Henryk M. Broder recently told the Dutch newspaper De Volkskrant (12 October) that young Europeans who love freedom, better emigrate. Europe as we know it will no longer exist 20 years from now. Whilst sitting on a terrace in Berlin, Broder pointed to the other customers and the passers-by and said melancholically: “We are watching the world of yesterday.”

Europe is turning Muslim. As Broder is sixty years old he is not going to emigrate himself. “I am too old,” he said. However, he urged young people to get out and “move to Australia or New Zealand. That is the only option they have if they want to avoid the plagues that will turn the old continent uninhabitable.”

Many Germans and Dutch, apparently, did not wait for Broder’s advice. The number of emigrants leaving the Netherlands and Germany has already surpassed the number of immigrants moving in. One does not have to be prophetic to predict, like Henryk Broder, that Europe is becoming Islamic. Just consider the demographics. The number of Muslims in contemporary Europe is estimated to be 50 million. It is expected to double in twenty years. By 2025, one third of all European children will be born to Muslim families. Today Mohammed is already the most popular name for new-born boys in Brussels, Amsterdam, Rotterdam, and other major European cities.

This article also addresses the inability and disinterest of secularist cultures (not, mind you secular governments, but the culture of the secular elite) to fight to keep what they have: In a recent op-ed piece in the Brussels newspaper De Standaard (23 October) the Dutch (gay and self-declared “humanist”) author Oscar Van den Boogaard refers to Broder’s interview. Van den Boogaard says that to him coping with the islamization of Europe is like “a process of mourning.” He is overwhelmed by a “feeling of sadness.” “I am not a warrior,” he says, “but who is? I have never learned to fight for my freedom. I was only good at enjoying it.”

“If faith collapses, civilization goes with it,” says [Tom] Bethell. That is the real cause of the closing of civilization in Europe. Islamization is simply the consequence. The very word Islam means “submission” and the secularists have submitted already. Many Europeans have already become Muslims, though they do not realize it or do not want to admit it.

People, particularly the hardline secularists, do not want to admit it but America is going to be forced to play things out on both a secular and supernatural stage, if she is going to stay alive, and not just alive but comprehensively American. Those, like Rosie O' Donnell, who would lump the Taliban and American Christians into the same boat do not realize that in doing so they are consigning themselves to Europe's fate. And Europe is dying. Europe will not fight.

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• Longman and McDonagh seem to envision breeding and childrearing as a sort of public good likely to be underprovided if individuals are left to their own selish devices. Those of us who decline to yield future workers are free riding off all that "human capital" produced by altuistic pram-pushers. But, as always, there is too little altruism to go around. So we should go for the next best thing: tax incentives.
  
  There is something inherently repellant about a social vision in which wombs and their fruits are conceived primarily in terms of future labor productivity and tax receipts. But you don't have to be repelled to see that the "kids as public goods" picture doesn't add up.
  
  First, it should be obvious that nations don't have to have pension systems highly sensitive to worker-to-retiree ratios. A shift to a system of mandatory personal retirement accounts immediately solves that problem. And then there are substitutes to native-born children. People born in other countries can also work and pay taxes. Indeed, if yours is a rich country, billions of less-rich people would like to come there. So let more of them come. And then there is technological progress, which allows machines to do some formerly human jobs, and increases the productivity of remaining human labour.
  
  There is no reason a nation with a shrinking population cannot maintain steady rates of GDP per capita growth if mechanization and labour productivity gains keep up a good pace. Indeed, George Mason economist Robin Hanson argues that soon enough robots will be doing almost all the jobs [pdf] anyway. So it is easy enough to imagine a country that maintains a high standard of living as the population eventually shrinks to ... nothing. People differ rather vehemently on this issue, but I see nothing wrong with a population dwindling away entirely, as long as living conditions remain high.