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Europe vs America

British historian Tony Judt calls the US a third world country and speaks about the failure of Europe's political class. Fellow Fulbrighter Wiltrud Hammelstein recommends an interview with him about the European and American model in the German paper Sueddeutsche Zeitung. Tony Judt wrote the review "Europe vs. America" for the New York Review of Books.

Have you heard of the German Christmas Pickle tradition? "A very old Christmas eve tradition in Germany was to hide a pickle deep in the branches of the family Christmas Tree." It seems to be a popular myth in the US. Dr. Dean wants to see more of it in Germany. Unfortunately most myths about the US are not as nice and funny.

The holiday season is considered to be a time for reflection & reconciliation and is often used to help those in need.  One of the many peoples who are in desperate need this holiday season are the victims of the Pakistani earthquake. Most of the tents given to the survivors in October are not designed for winter conditions.  The Atlantic Review published the appeals by three Pakistani Fulbrighters for more aid.

UPDATE 12/17/2005: The people of Darfur require much more help as well. To increase international awareness in this holiday season, Catez Stevens from New Zealand has organized SPOTLIGHT ON DARFUR 3: Christmas Edition. She invited all bloggers to submit their best posts about Darfur and then she picked ten of them. (We applied the same concept to our carnival of US-German relations.)

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Dialog International on : America's Waning Influence in the World

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Americans like to think of their country as a beacon of freedom in the world. In fact, the two words that President Bush likes to use in his speeches are freedom and victory. The problem is, those words ring hollow

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Thomas on :

There are plenty of myths against Germany. Some right- wing nut said recently that the Iraqi terrorist resistance is normal, because Germans were formed such a resistance against the US as well after the end of the Second World War. "Echoing an analogy to the current situation in Iraq offered by Bush administration officials, syndicated columnist Thomas Sowell claimed that "after Nazi Germany surrendered at the end of World War II, die-hard Nazi guerilla units terrorized and assassinated both German officials and German civilians who cooperated with Allied occupation authorities." However, according to several sources, the resistance to the Allied occupation was extremely limited and disorganized, unlike the Iraqi resistance of today." http://mediamatters.org/items/200512150003

David on :

Thanks for this reference. In the SZ interview Prof. Judt mentions something that is often overlooked: the unprecedented migration of German intellectual capital to the US in the 1930s and '40s. This contributed to American dynamism in every field: sociology, physics, architecture, cinema and even theology (Tillich). I am reading Prof. Judt's excellent book: "Postwar: A History of Europe SInce 1945" - it's an inspiring story that begins in the ruins of Hamburg, Rotterdam and Warsaw and the rebirth - both economic and moral - that follows. Along the way he explodes several myths - for example, that Ronald Reagan was responsible for the collapse of the Soviet bloc, You can download the useful bibliography of Prof. Judt's book at the Remarque Institute Web site: http://www.nyu.edu/pages/remarque/postwar.html

joe on :

Today the EU has warned Iran over denial of Holocaust. In practical terms, just what does that mean?

Thomas on :

Joe, I am not happy either with the EU policy on Iran, but what should they do? An embargo would radicalise them even more. The US has boycotted and threatened Iran for decades. Do you think it would make a difference if our unimportant EU would join the US in doing the same? Or do you want war? Besides, the US has repeatedly warned the evil North Korean dictators, who are responsible for starving their own people. In practical terms, just what do these warnings mean? Joe, please don't get me wrong: I don't want to divert your valid criticism of the EU into blame against the US. I just want to ask you for a REALISTIC AND PROMISING IRAN STRATEGY the EU should adopt. I think the EU should be tougher on Iran. But I don't know how exactly they should be tough. The tougher our rhetoric against Iran, the more Iranians will support AchMADinejad. Bush was talking tough about axis of evil, but this rhetoric made things worse rather than better. Rhetoric is not a policy. Besides, do you really think, we have the capabilities for another regime change? Germany is pretty busy in Afghanistan and the Balkans. The US is stuck in the Iraq, which was a war of choice.

Solipson on :

The book review is great, I would strongly suggest that it is debated here. Not that I agree with a lot of the statements made in there. All the productivity/work hours/OECD comparisons are in my view just plain wrong and misleading, because they reflect a 1960's view of the world. In a service industry for example, where you mostly cannot measure productivity, it is not correct to say that somebody is more productive because he/she works more. But nevertheless it is a very interesting article. And I would like to discuss, what all of the authors and Mr. Judt seem to implicitly assume, the fact that the EU and the US are moving away from each other (contrary to the Fukuyama assertion of everybody moving into some form of unified Western model) My hypothesis is that we, on both sides of the pond, still move into the same direction. There’s just one big difference: There is no role model anymore. In the 90’s, the role model used to be the US, with everybody moving towards US-style capitalism. When the bubble popped and the bombs started to fall, suddenly everybody talked about the differences first and then the fact that the two continents are on different planets. I disagree. Any comments?

ROA on :

Solipson: I also think there are many facts in the article that are wrong. As far as whether the US and Europe are moving in the same or opposite direction, is Europe moving a single direction? My understanding was that “Old Europe” that is France, Germany, and most of the long term EU countries wwas moving in a socialist/controlled direction, while the ex Soviet block was moving in a more free market/capitalistic direction. Am I wrong?

Thomas on :

Yes! You are very wrong. You seem to be very ignorant of European politics. The red-green government has implemented many very neoliberal reforms. That's why Schroeder's party lost one regional election after the other and he had to call for new elections. A new party was established consisting of SPD lefties and the former communists joined forces. This party, Die Linke, has won MANY seats, because many Germans don't like the tough neoliberal, free market reforms. The new Europe however is not moving in a free market direction. The Polish just voted for a more socialist party to lead their country.

ROA on :

Actually, your statements about Germans rejecting politicians who attempt economic liberation would seem to support my thesis about “old Europe” while the Polish elections indicate I was mistaken about “new Europe.”

Solipson on :

ROA here we go again.:-) First of all "Old Europe" does not exist. It is a term coined by a US politician to describe countries that were against the Iraq war. There is only one Europe, normally referred to as the EU. It is the worlds largest economy, the worlds largest exporter and the world largest importer. It keeps the world economy humming. Secondly, the move to the socialist direction has been reversed a couple of years back. I used to refer to Germany as a socialist country for a long time, not any more. I stopped this mainly because there has been a momentum building in Germany to change the very structure of the country. I even moved back to Germany (from the US/UK, where I have lived for nearly a decade), because mainland Europe and especially Germany will be rock’n roll in the next 20 years. The former social democratic/green government has started to make some changes in a lot of areas like labour laws etc. They are far from neoliberal changes Thomas, but they are a start. The new extrem left party "Die Linke" has won some seats, but they have not increased their share when compared to the sum of their former parts. One should not forget when talking about Germany, that there’s a two tier economy in this country. On the one hand is the corporate sector, which is in unbelievable good shape, see the level of exports, which are the largest in the world. On the other hand is the rest of the economy, which is in very bad shape, see the rate of unemployment. This is the sector that people , when talking about the German malaise, mean. The reasons for the sorry state of this part of the economy are manifold, in my humble opinion because Germany does not have a credit market. It is not even a malfunctioning market, it simply does not exist. Public banks have nearly 70% market share in the banking sector and they have no inclination whatsoever to make money. But even this is changing. In short, there is a strong movement in Germany towards more economic liberty and individual responsibility. Sounds familiar, ROA? This is reflected as well in the new Chancellor Mrs. Merkel. I have high hopes for her and I think she will change this country more than any other politician in the post-war German history.

ROA on :

I realize “old Europe” doesn’t exist. I was just attempting to differentiate between that portion of Europe that appeared to me to be more dominated by government regulation. But if you are correct, that there is just one Europe what regulatory role does the EU play? And how will that impact Germany? Brussels doesn’t seem to be extremely supportive of economic liberty and individual responsibility. Also, if Europe is really one unit, when does the EU start to represent all of Europe in international organizations such as the UN? Why should Europe have so many representatives in the UN if they have a common foreign policy? Or should every state in the US be represented too? I actually hope you are correct about Germany, and all of Europe for that matter, becoming more entrepreneurial. My impression is that much of Europe has become extremely risk averse.

Joerg W on :

@ Solipson "Mainland Europe and especially Germany will be rock’n roll in the next 20 years." I hope you are right. Rock'n'Roll is cool. Jeremey Rifkin seems to agree: "As Jeremy Rifkin sees it, the American and European dreams are — at their core — about two diametrically opposed ideas of freedom and security. While Americans have long valued autonomy as a component of freedom, Europeans find this same freedom within communities. While both dreams have their merit, Rifkin sees the European Dream as better serving the future of humanity." http://www.theglobalist.com/DBWeb/StoryId.aspx?StoryId=4498 However, I got the impression that there are more mainland Europeans emigrating to America and the UK than the other way round. You are one of the exceptions, it seems. @ David "the unprecedented migration of German intellectual capital to the US in the 1930s and '40s. This contributed to American dynamism in every field: sociology, physics, architecture, cinema and even theology (Tillich)." I think there is still a brain drain from Europe (and the rest of the world) to America, because America seems to offer better working and living conditions to many folks... Am I wrong? The Atlantic Review will have more on the European and the American model in the next few weeks. One of our readers just emailed us some great material.

Solipson on :

Joerg I think the brain drain is not that big anymore from a European perspective, but the attractiveness of the US as an immigration country is still as strong as ever. The DHS (http://uscis.gov/graphics/shared/statistics/yearbook/YrBk04Im.htm) has a couple of fascinating statistics. Key points: - Immigration is up 5% on average for each year 2001-2004 compared to the 1990's (app. 950,000 per year) the highest ever - Mexico has nearly caught Germany as the main source country of immigrants (Germans 7,2 million, Mexicans 6,8 million) - The split between Europe, Asia and South America is pretty even and has not massively changed over the last couple of years

joe on :

So if I am to understand the answer to my question, in partical terms this warning means nothing. This leads to two follow on questions. 1) Why was the statement make? Was it made for internal or external consumption? 2) Do you think Iran also realizes the statement has no meaning either?

joe on :

I guess one must first define what is meant by the comment “not that big anymore from a European perspective”. Unless something has changed in the last couple of years it would appear at first glance to be very big. One must first agree to the concept that research and development of future technologies is important. If one does agree to this, then the EU is falling further behind the US and Japan and by 2010 could be overtaken by China. It does seem there is actual disagreement among the EU leaders if this area is important. I make this comment as it relates to the EU budget. The budget reflects the priorities of the EU. It would seem France, supported by Germany, believes the EU’s future lies in agriculture in the form of the CAP, as 40% of the budget is devoted to this program. PM Blair had wanted to allocate more to education and R&D but this was not acceptable to the majority of EU member states. So in this sense the statement this is not big anymore from a European perspective is true. If you think of R&D as three parts – investment (money), personal (S&E researchers) and opportunity, the EU does not measure up to being a competitive worldclass player. This comment was contained in an overview given European Research Commissioner in 2003. Brain drain on the rise The ‘brain drain’ of people born in Europe is increasing. Seventy one percent of EU-15-born US doctorate recipients who graduated between 1991 and 2000 had no specific plans to return to the EU-15, and more and more are choosing to stay in the US. The most important reasons keeping European scientists and engineers abroad relate to the quality of work. Better prospects and projects and easier access to leading technologies were most often cited as reasons behind plans to work abroad. More can be found here http://europa.eu.int/comm/research/press/2003/pr2511en.html And here http://europa.eu.int/comm/research/era/pdf/indicators/snap6.pdf And even more here http://www.welt.de/data/2005/07/20/748011.html And here ftp://ftp.cordis.lu/pub/indicators/docs/kf2005_report.doc http://www.euractiv.com/Article?tcmuri=tcm:29-142731-16&type=News Since that report the situation has not improved significantly and in some areas has gotten worse. This causes me to wonder just what was meant if anything when in March 2000, the EU Heads of States and Governments agreed to make the EU "the most competitive and dynamic knowledge-driven economy by 2010". Was this another statement made by the EU that had no meaning as Thomas has implied about the EU’s warning to Iran?

Solipson on :

Joe I don't dispute your statements; have just some general remarks and questions. I am not sure the R&D numbers paint the true picture. I know the discussion (I am active in nanotech) have however this itchy feeling, every time it starts again, that something is wrong. First of all the definition of the metrics is something I would question. Everybody is bragging about number of patents and scientific publications. I always look at that and think: Gosh, where do they compute the research being done in the SME sector in the EU. I have worked in a typical German Mittelstand company for some time. The usual engineering, 80% world-market share, no competitor-in-sight type of company. You know why we dominated our field since 1932? Research&Development. Simple as that. You know how many patents protected us? None. Number of scientific publications? None. And we were just one of a couple of thousand high-tech medium-sized companies in the EU, whose R&D efforts cannot be measured because the data is not collected in the first place. Talking about metrics. Remember the instances when something is broken while staying in a US hotel? You call reception and they tell you that the engineer will come shortly. It normally is a Mexican, who does not speak English and would have a hard time to spell the word that he is supposed to embody. In Germany this would be a minimum four-year stint in a university, leaving with more knowledge than Wernher von Braun ever had. Now what’s better, 10 Mexican engineers or one German? I exaggerate I know, but I hope you get my drift. But look at it from a different angle. If the EU is falling behind, in R&D for some time, then where is it reflected in products? Where are the cutting edge planes, cars, robots, machinery, electronics being built. Seattle? Detroit? San Diego? No. In Lyons, Stuttgart, Milan and Dresden. And Seoul and Tokyo obviously. But I may be wrong.

joe on :

Solipson I am sure you are not wrong. You are probably very correct. Your remarks frame the discussion more into a question of, “are the current metrics being used the best way to measure this”. I really cannot answer that. If you feel they are wrong, then you must equally feel there is a better measurement. I would enjoy reading what measurement you would use. You also refer to your own experience of firms doing research and not filing patents or rendering publications. I could understand the publication part but not applying for a patent seems to me to be a missed opportunity to not only protect intellectual property but to recapture some of the R&D investment. I find the latter a bit bizarre. Equally it would seem only EU firms are the ones who take this approach, and this same type of bizarre behavior is not happening in other firms in other nations. So the metrics for other nations are correct and those for the EU are incorrect. If this is the case as you presented it, then it would appear the failure to protect intellectual property is either not considered to be important within the EU or it is a failure of management and not the R&D community. The truth is the EU is much stronger in this area than is being reported or even its leadership believes. Your example about the 10 Mexicans and the 1 German is an excellent example of resource allocation. Of course, I have never had an engineer show up to fix anything before. It is usually some tradesman, such as a plumber if I have a problem with either my water or sewage system. I don’t really think I could afford an engineer. Frankly there are times I am shocked at the cost of a tradesman. As for language skills, I am not a plumber so I am not sure I would understand what he was talking about anyway. My personality is such that I do not view this as a social event but one of pay for services renedered. Putting your example in the context of the EU, was this the concerns the French had when they spoke of the Polish plumber? Then staying in a hotel in Paris, instead of 10 Polish plumbers showing up, one French engineer would appear. This might explain the room rates. I have never been one to question the reports prepared by the EU nor for that matter much of what the German M$M reports about the EU or conditions in Germany. It would seem you take issue with that. You are in a much better position to make an assessment of what is actually true. I guess this would not be the first time a EU report is wrong. I can share your position on the M$M as I too take issue with many things they report and how they are framed. Finally if I am to understand the drift of your comment this really is in fact not a big deal because the metrics are flawed. This is very good news I would think for the EU. And yes, most great advances do not occur in the US. They happen some place else. The EU will in fact become the most competitive and dynamic knowledge-driven economy by 2010. As more than 50% of the time when this goal was established has elapsed we should be seeing the effects on economic performance very soon, I would think. The statement made in 2000 was not meaningless it was just not needed or warranted. Thank you for clearing all of this up.

Solipson on :

Joe I have not said that the metrics are wrong, I have just questioned them. My main point is that the Europeans should start getting their act together and use the definition of metrics as a marketing tool the way the Americans have perfected them. The patent issue, I am sorry, I forgot the one that we filed. It was immediately copied by a small competitor on behalf of a large multinational client who wanted to save money. It took us 8 years through the courts to finally get an injunction. There are things better left unfiled for patent. And this "bizarre" behaviour is nothing the rest of the SME world doe not know about. I know tons of Japanese, Korean, and American companies acting in exact the same way. Talking about patents, ever heard about the patented way of using a swing? Or some of the other bizarre patents (including software patents) that you can file in the US of A? Every single one is counted up to show the alleged superiority of the US system. You find them here: http://www.delphion.com/gallery or here: http://www.patex.ca/wackpats.html (I love the Protective underwear with malodorous flatus filter) Don’t get me wrong, in many basic research areas and some applied fields like pharmaceuticals the US is way, way ahead of the EU. The research facilities are better staffed and better funded. That’s for me the main reason why the Eurocrats complain loudly about us falling behind, They want more money. And actually they got it. You should hear them today, two years later. I was at a nanotech meeting not long ago and the EU representative got into a shouting match with the US representative on who spends more and who files more patents. Both claimed the top spot obviously :-) Regarding the 2010 statement, I think it embodies everything that the bloody Eurocrats/Politicians are getting wrong about the whole EU. They want to spend their way out of their inability to get structural reforms, like abolishing CAP, implemented. There is only one measure for me that shows whether an economy is competitive or not. That’s the volume of exports. If somebody else in a far away land buys my products, despite all the hassle, then I am competitive. The EU has around 22% export world market share, the US has around 15% and Japan has 8%. As the products that get shipped into the world tend to be higher value-added, I would call this a pretty good sign of being the most competitive and knowledge driven economy in the world. The sorry state of the rest of the EU economy in terms of overall growth is funny enough a direct consequence of the EU companies being that hypercompetitive. They are forced to get ever more productive and therefore substitute labour with capital. In the US people have to find new jobs when they get laid off. In Europe it is first of all very hard to lay people off (funny enough it the most complicated in the UK, but that’s a different story) and then very hard to hire them, because once you have them the cycle starts again. In the meantime the pressure to find a new job is not that overwhelming. This in combination with the non-functioning credit markets in the EU, has created all the problems. The tone of your reply sounds to me like “ How dare he question the mighty USA!” Look at the raw data and not the conclusions some Eurocrats or some intern at the World Economic Forum comes to.

Shawn Beilfuss on :

New statistics from WTO: Top 5 Exporters (2004) Germany 10% (increase of 21%) USA 8.9% (increase of 13%) China 6.5% (increase of 35%) Japan 6.2% (increase of 20%) France 4.9% (increase of 14%) EU as a whole: 18.1% USA: 12.3% China: 8.5% Japan: 8.3% Canada: 4.8% If you take the North American sector as a whole, with Canada and Mexico, it is 19.9%. The USA is at 15% for commercial services, more than double that of Germany at 6.3%. The EU as a whole is tops at 27.8% and USA at 20.7% (at 24.6% if Canada and Mexico are added). The EU and North America have the same ratio of goods and services trade. USA is by far the largest importer of goods.

Solipson on :

Shawn thanks, mine were from the EU website and the year 2003. By the way, I found an interesting article (via Slashdot) on the sorry state of the US patent system. Much along the lines I argued in my last post. Slashdot is a good source for IP/Patent related discussion anyway. (http://www.businessweek.com/technology/content/dec2005/tc20051220_827695.htm)

joe on :

Solipson, You totally misread my “tone”. There was no defense at all about the US or at least there was on intent to defend the US. Looking at the comment I made, I believe the only reference to the US were quotes by Europeans and this more in reply that you felt the “brain drain” was no longer such a big deal. I very much attempted to limit my comments to that part of the discussion and to focus on the question asked. I think I conceded the point to you when I stated most great advances do not take place in the US. As for the various organs of the EU, I have no way to assess their effectiveness or their validity. It would seem in this area what was true in 2000 and the various heads of state believed to be true is no longer true in 2005. I would tend to agree with you on the point they want more money. This seems to be a universal trait of all governments, the fact they want more of your money. My question concerns the metrics being used was in response to your comment that you felt they were wrong or at least disagreed with them. From your initial comment you gave me the impression it was because many EU firms just did not file patents or brother to publish. Equally, I am well aware of the internal conflict between “trade secrets” and patents. The advantages and disadvantages of those two options. Your response led me to believe this was more of a EU phenomena – patents and publications. Now it would seem this is quite common within the international SME community and not just limited to European nations. Of course, I would be highly upset as a shareholder if a firm invested in R&D, developed something worthwhile and then failed to protect it. I would be voting for new management. But is it really a question of the metrics being used or it is a failure to properly work within the framework of the metrics and in fact capture what is being done? Failing to do the latter, does this in fact invalidate the metric? Your statement of what the Americans have done in perfecting the use of the metrics is interesting. I did not realize that. I tend to think more in terms individual corporations marketing products and the success or failure of a product. I do realize there is a lot of basic research, which will never result in commercialization. Even in the area of Nobel Prize winners, they are normally related back to some organization be it academic or corporate and only in announcing whom the winners are is nationality ever mentioned. In my limited experience of meeting these people they are introduced as so and so from so and so organization. Many times the fact they are a Nobel Prize winner might not even come up; even less so nationality. You must have had a much different set of experiences. I also found some of the things patents have been issued for to be amusing as you thought they were. Concerning the Protective underwear with malodorous flatus filter, not knowing anymore about it than your reference I cannot really make an informed comment on it. I could see how it might in fact have some application to the disposal diaper industry. My experience having been around a baby who has loaded his diaper and it has not been changed causes me to think if this actually worked there would be a market for it. I would tend to agree with you about the need for structural reforms but it would appear this is only agreeable to the majority in the abstract. Actually, many feel it is an attack on the very core of the social welfare state as it has developed in many European countries. Given the problems of addressing the CAP where 40% of the EU budget goes to less than 5% of the people, one has to question will structural reforms actually ever occur. I am of the belief given a choice most people would prefer the status quo. The discussion about exports is equally interesting but can also be a bit misleading too. I would present to you the best measure of exports for Europe is a EU total discounting all intra EU transfers. This seem logical if for no other reason than the EU is a single market. So from what you have said the EU is the most competitive and knowledge driven economy in the world. If I am to understand your rationale the metric here is high value exports. This might in fact be the best metric of all. I do have a request. Would mind posting a good reference for the raw data you feel would bring all of this more into focus. Thank you in advance.

M.J.C.A. Stout Vuurland on :

In fact I am shocked that it is this big an issue. Old Europe is as much (and even more) a part of modern America (USA) tan it is part of modern day Europe. Traditions in Europe have faded and morality is maintained overseas. In stead of values we had for ages (I'm European) we try to import as much of American culture and goods and yes, we do look up to America. In fact we cherish the hopeful elements the States represent. I think the main problem we are confronted with nowadays is that in Europe we are used to pretty liberal governments and the rather conservative Bush Administration simply invokes small amounts of opposotion among insignificant groups of people. Please, do not make such a big fuzz about it... It's not worth it! M.J.C.A. Stout Vuurland, News Editor

Rosemary on :

Thank you for remember Darfur. I give thanks for those who help. I also pray they are granted peace for this season, if only for a little while. Then I pray they are granted peace forever! Amen.

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