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The Atlantic Tide is Shifting

Until recently the European countries changed their economic policies to emulate the US system. Now the financial crisis makes the US move toward a more European system, writes the Wall Street Journal:

The U.S. is spending hundreds of billions of dollars -- including increased assistance to the unemployed -- to prop up the economy, and wants Europe to follow suit. But most of Western Europe already has a strong, if costly, social safety net, so governments feel less pressure to spend their way out of trouble. The irony is that for years, Europe tried to rein in its own worker protections -- long considered a drag on growth in good times -- to emulate the faster-growing U.S. economy. Now the U.S. is moving toward a more European system.

Yes, the WSJ also points out the benefits of the current US system and writes that most economists expect the US to recover faster than Europe, because "Europe's high payroll taxes, along with restrictions on when and how companies can lay off workers, make employers slower to rehire when a recession ends." Okay, but all this comes at the price of more panic during every recession. Europeans panic less due to the cushions built into the system, which the WSJ considers so important that they start with it: "In Germany, losing his factory job didn't stop Alfred Butt from taking a Mediterranean vacation this winter."What system do you prefer?


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John in Michigan, USA on :

"What system do you prefer?" It is a fantastic question. On the one hand, we have the admonition to "be kind". That's in [url=]the Bible[/url], and everyone seems to agree, from the [url=]Humane Society[/url] to the [url=]Greatful Dead[/url]. Europe seems to have the edge in being kind. On the other hand, we have the danger of complacency, or even, decadence. In a democracy, if the people are too insulated from the ups and downs of the world, they cannot effectively govern themselves, and become pawns of the governing elite. The whole thing degenerates into bread and circuses, a problem with which one great Mediterranean power became all too familiar. The US traditionally has an edge here, although I suppose it depends on how you define this problem. To me, the ultimate test will be: which great power, the US or Europe, will be the first to confront and resolve the problem of making entitlements sustainable over multiple generations. This is a demographic and financial time bomb that threatens all of us. That is why it is so important to have a strong trans-Atlantic relationship. It is almost as if the two sides were designed as a sort of large-scale, controlled lab experiment on the virtues of being kind vs. being self-reliant. We will always have a great deal to learn from each other.

Pat Patterson on :

Bossnappings and mass demos demanding jobs and no business closures are typical of the US? In fact currently there are an estimated 3 million jobs that could be filled but there are simply not enough trained people to fill them. Which in and of itself is simply a temporary situation as those looking for work, at least in the US, can acquire retraining. I would say that the panic is more confined to Europe as the so-called weaker safety net in the US means many are looking for work rather than demonstrating in the street. People generally can adjust, not necessarily accept, the loss of a job but find the stress of not knowing when that pink slip might come far worse. I'm not counting, fairly or not, the photo op demos of the likes of SEIU or ACORN because I don't really think that their leaders will ever truly be content and close up shop for a job well done. Heavens. that means looking for a job that doesn't involve extortion and influence peddling.

SC on :

"...Europeans panic less due to the cushions built into the system, which the WSJ considers so important that they start with it: "In Germany, losing his factory job didn't stop Alfred Butt from taking a Mediterranean vacation this winter.'What system do you prefer?'" If that is how the choice and question are to be framed, then I would not at all be surprised to find the majority of Americans preferring the life of Herr Butt. However, I wonder whether the choice, at the level of Herr Butt, can be presented differently.

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