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| Shakka |
An interesting article I just read in the WSJ today.
Link
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Europe vs. America
June 18, 2004; Page A10
The growing split between the U.S. and Europe has been much in the news, mostly on foreign policy. But less well understood is the gap in economic growth and standards of living. Now comes a European report that puts the American advantage in surprisingly stark relief.
The study, "The EU vs. USA," was done by a pair of economists -- Fredrik Bergstrom and Robert Gidehag -- for the Swedish think tank Timbro. It found that if Europe were part of the U.S., only tiny Luxembourg could rival the richest of the 50 American states in gross domestic product per capita. Most European countries would rank below the U.S. average, as the nearby chart shows.
The authors admit that man doesn't live by GDP alone, and that this measure misses output in the "black" economy, which is significant in Europe's high-tax states. GDP also overlooks "the value of leisure or a good environment" or the way prosperity is spread across a society.
But a rising tide still lifts all boats, and U.S. GDP per capita was a whopping 32% higher than the EU average in 2000, and the gap hasn't closed since. It is so wide that if the U.S. economy had frozen in place at 2000 levels while Europe grew, the Continent would still require years to catch up. Ireland, which has lower tax burdens and fewer regulations than the rest of the EU, would be the first but only by 2005. Switzerland, not a member of the EU, and Britain would get there by 2010. But Germany and Spain would need until 2015, while Italy, Sweden and Portugal would have to wait until 2022.
Higher GDP per capita allows the average American to spend about $9,700 more on consumption every year than the average European. So Yanks have by far more cars, TVs, computers and other modern goods. "Most Americans have a standard of living which the majority of Europeans will never come anywhere near," the Swedish study says.
But what about equality? Well, the percentage of Americans living below the poverty line has dropped to 12% from 22% since 1959. In 1999, 25% of American households were considered "low income," meaning they had an annual income of less than $25,000. If Sweden -- the very model of a modern welfare state -- were judged by the same standard, about 40% of its households would be considered low income.
In other words poverty is relative, and in the U.S. a large 45.9% of the "poor" own their homes, 72.8% have a car and almost 77% have air conditioning, which remains a luxury in most of Western Europe. The average living space for poor American households is 1,200 square feet. In Europe, the average space for all households, not just the poor, is 1,000 square feet.
So what is Europe's problem? "The expansion of the public sector into overripe welfare states in large parts of Europe is and remains the best guess as to why our continent cannot measure up to our neighbor in the west," the authors write. In 1999, average EU tax revenues were more than 40% of GDP, and in some countries above 50%, compared with less than 30% for most of the U.S.
We don't report this with any nationalist glee. The world needs a prosperous, growing Europe, and its relative economic decline is one reason for growing EU-American tension. A poorer Europe lacks the wealth to invest in defense, a fact that in turn affects the willingness of Europeans to join America in confronting global security threats. But at least all of this is a warning to U.S. politicians who want this country to go down the same welfare-state road to decline. |
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| occrider |
| Woohoo, that's right! My GDP kicks the crap out of your GDP any day of the week!!! Who wants to step up??? New York?? Kansas??? California?? You got NOTHING!! :p |
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| BadBadNeil |
yay Connecticut!
Interesting read. |
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| Shakka |
| quote: | Originally posted by occrider
Woohoo, that's right! My GDP kicks the crap out of your GDP any day of the week!!! Who wants to step up??? New York?? Kansas??? California?? You got NOTHING!! :p |
LOL!:stongue: :haha:
What gives with the wealthy politicians? Is anybody surprised? I'm not. Wasteful bastards.:rolleyes: |
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| occrider |
The entire 49 page report is a fairly interesting read:
http://www.timbro.com/euvsusa/pdf/EU_vs_USA_English.pdf
Of course one must keep in mind that it is a free trade think tank when reading it. It performs a lot of interesting analyses however.
Hey Opus, go to page 14. Look I see you! Getting your ass beat by Wisconsin and Nebraska heehee. Goddammit if anything WE should be given statehood and YOU guys should be demoted to being a district! The district of Kansas ... I like the sounds of that. :D |
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| BadBadNeil |
| One thing I noticed in the article it said "cell phones per 1000" in the USA was 12.4 and in Sweden was 229.9. I knew that sweden would be higher but 12.4 seems very low? Hell every person I know seems to have a cell phone or in my case two of them. |
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| Shakka |
| quote: | Originally posted by BadBadNeil
One thing I noticed in the article it said "cell phones per 1000" in the USA was 12.4 and in Sweden was 229.9. I knew that sweden would be higher but 12.4 seems very low? Hell every person I know seems to have a cell phone or in my case two of them. |
True dat. Half of the homeless population in America has cell-phones. Go figure.
Then again, Nokia is headquartered in Finland. Not Sweden, but close enough:p |
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| occrider |
| quote: | Originally posted by BadBadNeil
One thing I noticed in the article it said "cell phones per 1000" in the USA was 12.4 and in Sweden was 229.9. I knew that sweden would be higher but 12.4 seems very low? Hell every person I know seems to have a cell phone or in my case two of them. |
It could be that the European land line phone system sucks. I had read an article a while back that unlimited local calling minutes was unheard of in Europe. Also long distance calling must be a bitch considering you're likely to make long distance calls country to country as opposed to state to state therefore exposing you to more charges? THat's my guess. |
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