6 ms·

America Has Become Too European

33 points by anamax 16y ago

zyb09 16y ago
What has the FED buying US Treasury securities to do with Europe? That's the opposite of what Europe is doing to handle the economic crisis. The ECB is defiantly not buying German securities or anything like this. Health care and welfare are completely different topics and don't have anything to do with the unemployment rate or economic growth, yet he mentioned them as example of how America became too European and that's supposed to have caused all these problems. If the FEDs decision is the right one is another discussion, but the way he used Europe in this article to convey his point doesn't make much sense.
- Andrew_Quentin 16y ago
  He mentioned healthcare also. Thus the way he is using europe is possibly to contrast between a hardcore capitalist system like the US and a more soft capitalist system like europe.
abrown28 16y ago
without reading the article I will say: a) this is too obvious to need voicing b) it ain't hacker news
- i80and 16y ago
  Judging an article without reading it is also not Hacker News.
  - Andrew_Quentin 16y ago
    Really? Off-Topic: Most stories about politics I think the title conveys possibly well that it is about politics, hence no need to read the article.
    - mkr-hn 16y ago
      If the community decides that it falls into the "most stories" side, it'll fall off and be forgotten.
      - DougBTX 16y ago
        All stories fall off and get forgotten. Or receive negative comments for being "duplicates".
_delirium 16y ago
I suppose one doesn't actually need first-hand experience to have such an opinion, but it is somehow a little bit surreal to read a call for "A Return to Traditional American Virtues" written by a Swiss professor who works in Germany. It'd be like reading an American professor who'd never lived in Switzerland pontificating on how the Swiss need to return to their core values. It's a particularly nice juxtaposition in this case, because one traditional American value is not listening to what European intellectuals say. ;-)
- Vivtek 16y ago
  He's like the Karl May of economics! (For those who've never heard of Karl May, he wrote a bunch of Westerns that are very popular in Europe. He had never been to America - and it shows in the books. But they are popular.)
- enjo 16y ago
  Not to mention how poorly cited the whole thing is (like the dubious assessment that unemployment is twice the stated rate).
  - joe_the_user 16y ago
    That's one point that one could defend. The Shadow Government Statics site seems to put the current rate at about 23%. http://www.shadowstats.com/ http://www.shadowstats.com/ And sgs altogether makes a fairly plausibly argument... unlike parent article...
  - yummyfajitas 16y ago
    (like the dubious assessment that unemployment is twice the stated rate). I've actually seen this claim made a lot, both in the media and on blogs. The basis for that claim is that the speaker believes U6 rather than U3 should be the official unemployment rate, and U6 is typically about double U3. [edit: See joe_the_user's post, which was submitted as I was writing this.]
- seanmcq 16y ago
  I think the key take away is, if he's arguing that ferociously that we're doing it wrong, he must be betting against what we're doing.
Miserlou57 16y ago
A good read, but it seems to idealize how America rose to such strength and gloss over how many serious problems came with it and the subsequent need for government to step in and protect (Labor laws, EPA, FDA, SEC, the list goes on...)
Entlin 16y ago
For people who like to read the original, here's the german version: "Amerikas europäische Krankheit" - http://www.spiegel.de/wirtschaft/soziales/0,1518,714521,00.html http://www.spiegel.de/wirtschaft/soziales/0,1518,714521,00.h...
zeteo 16y ago
I can't really evaluate the article on economic terms, but it fails miserably in its knowledge of history. If we are to believe prof. Straubhaar, in the 20th century "[t]he United States rose rapidly from virtually nothing to become the most politically powerful and economically strongest country in the world", by following the economics of some fuzzily defined American Way where "every man was responsible for himself -- in good times and bad. No one could count on government assistance". Then the good professor argues for a return to these good old times. The historical reality begs to differ. Far from being "virtually nothing", the US manufacturing output was the first in the world as early as 1890: http://en.wikipedia.org/wiki/Economic_history_of_the_United_States#The_Gilded_Age:_1865.E2.80.931900 http://en.wikipedia.org/wiki/Economic_history_of_the_United_... This economic growth was, by the way, happening behind some pretty heavy protectionist measures (initiated by none other than Lincoln): http://en.wikipedia.org/wiki/Tariff_in_American_history#Civil_War_protective_policy.2C_1861-1913 http://en.wikipedia.org/wiki/Tariff_in_American_history#Civi... But maybe this economics professor wasn't referring to economic output? Let's look at the principles that guided Franklin Delano Roosevelt, under whose leadership the US became acknowledged as a military superpower as well: "Throughout the nation men and women, forgotten in the political philosophy of the Government, look to us here for guidance and for more equitable opportunity to share in the distribution of national wealth" A complete opposite from the article's description of an ideology where "no one could count on government assistance"! In conclusion, the article's premises are based on a very shaky foundation and expose a shocking ignorance (for an economics professor, at least) of US history. And if the foundation is bad, I don't think the rest of the edifice hold up very well either.
- deleted 16y ago
  [deleted]
- Andrew_Quentin 16y ago
  All your points are fine, except for one. The article does not seek to enlighten or inform, but instead it seeks to influence, by whatever mean, for whatever reason. Thus the author is in no way to blame, but those in this community who up voted it.
  - 16y ago
ancornwell 16y ago
I couldn't agree more. There was an article in the WSJ last week about the benefits of sleeping on the job. I'm sure it was read because it seriously clashes with the NY state of mind, but I saw some pretty supportive comments on Twitter from Californians and New Yorkers alike. I would never want my office to be in France where you get to work at 11, go to lunch and have a few bottles of wine from 12-4, and then take off at 5. I'm glad Sarkozy raised the retirement age to 62 though. I just don't want a culture swap, but it looks to be one of the many directions our melting pot could take. My french roommate used to put the eggs in the cupboard! Crazy! If I saw one of my employees put the eggs in the cupboard and then take a nap in my New York office, my brain would implode. I'm not suggesting to operate like a sweatshop and I'm aware that manufacturing power in the United States is quite volatile right now, but even when people focus on those right-brain activities, the earth still spins and capitalism still exists. Some of my best work is produced when my fatigue becomes delusion :D
- ugh 16y ago
  You are funny. I must say, those French are damn impressive. They work only ten hours a week (probably eight because – honestly – you just know that they will take fridays off) and still manage to be the fifth largest economy in the world. Isn’t that something we all should try to imitate, not scoff at?
  - ancornwell 16y ago
    Sarkozy is trying to change social opinion of "careers" and "work" in France to keep pace with other countries. France is a very old country which also makes it even harder to bring change. I think there are a lot of people in France who pick up the slack for others. Kind of like the Israel... If there is a country we should imitate, I think it would be Israel. Now that's ambition, dedication, and of course, resilience. I think Tel Aviv has the highest concentration of tech startups in the world also. Why would you think French people only work ten hours per week? My French roommate never understood sarcasm either. He also kept putting the damn eggs in the cupboard even after I told him he would get sick.
    - 16y ago
ugh 16y ago
I’m confused, didn’t European nations have smaller stimulus programs compared to the United States? Isn’t he consequently arguing for the US to become more European in solving this crisis?
- kthanx 16y ago
  The funnt thing is that Germany had a BIGGER stimulus than the US. Look at the data of real government consumption of goods and services, it has risen more in “austerity” Germany than in the United States. Quarter Gemany US 2007Q4 100.0 100.0 2008Q1 100.4 100.6 2008Q2 101.5 100.8 2008Q3 101.7 102.2 2008Q4 102.5 102.9 2009Q1 103.6 102.5 2009Q2 104.2 103.8 2009Q3 105.1 104.0 2009Q4 104.8 103.9 2010Q1 106.9 103.8 2010Q2 107.3 104.5 Source: http://krugman.blogs.nytimes.com/2010/08/28/angela-and-the-fifty-hoovers/ http://krugman.blogs.nytimes.com/2010/08/28/angela-and-the-f...
  - zyb09 16y ago
    But you have to consider that government spending in Germany is about 280 billion euros, while the US budget is at 3.8 trillion. It's a larger country and all, but these number are really out of proportion.
    - kthanx 16y ago
      German taxes as a percentage of GDP is 39.3%. The US number is 28.2%. Government income should be about the same as government expenditures, so that means that the German stimulus was even bigger than the number in my previous comment. http://en.wikipedia.org/wiki/List_of_countries_by_tax_revenue_as_percentage_of_GDP http://en.wikipedia.org/wiki/List_of_countries_by_tax_revenu...
nickpinkston 16y ago
His thesis of structural problems being a large part of the crisis (rather than simple systemic risk) is probably true though. The "fire" instead of "hire and fire" partially reflects that the unemployed aren't useful to employers. Yes, a sizable chunk is due to lower production due to the recession. Remember how this is the "man-cession"? This means construction and manufacturing. Productivity is up (and not only because people work harder to not lose jobs) due to a well-needed gutting due to having a good excuse. This is some painful creative destruction. Instead of pouring money out piecemeal, stimulus needs to address the structural issues: modernizing the workforce/education system, rearranging (cut/add) regulations, and useful infrastructure (e.g. not just fixing potholes).

33 points by anamax 16y ago

zyb09 16y ago

What has the FED buying US Treasury securities to do with Europe? That's the opposite of what Europe is doing to handle the economic crisis. The ECB is defiantly not buying German securities or anything like this. Health care and welfare are completely different topics and don't have anything to do with the unemployment rate or economic growth, yet he mentioned them as example of how America became too European and that's supposed to have caused all these problems. If the FEDs decision is the right one is another discussion, but the way he used Europe in this article to convey his point doesn't make much sense.

Andrew_Quentin 16y ago
He mentioned healthcare also. Thus the way he is using europe is possibly to contrast between a hardcore capitalist system like the US and a more soft capitalist system like europe.

abrown28 16y ago

without reading the article I will say: a) this is too obvious to need voicing b) it ain't hacker news

i80and 16y ago
Judging an article without reading it is also not Hacker News.
- Andrew_Quentin 16y ago
  Really? Off-Topic: Most stories about politics I think the title conveys possibly well that it is about politics, hence no need to read the article.
  - mkr-hn 16y ago
    If the community decides that it falls into the "most stories" side, it'll fall off and be forgotten.
    - DougBTX 16y ago
      All stories fall off and get forgotten. Or receive negative comments for being "duplicates".

_delirium 16y ago

I suppose one doesn't actually need first-hand experience to have such an opinion, but it is somehow a little bit surreal to read a call for "A Return to Traditional American Virtues" written by a Swiss professor who works in Germany. It'd be like reading an American professor who'd never lived in Switzerland pontificating on how the Swiss need to return to their core values. It's a particularly nice juxtaposition in this case, because one traditional American value is not listening to what European intellectuals say. ;-)

Vivtek 16y ago
He's like the Karl May of economics! (For those who've never heard of Karl May, he wrote a bunch of Westerns that are very popular in Europe. He had never been to America - and it shows in the books. But they are popular.)
enjo 16y ago
Not to mention how poorly cited the whole thing is (like the dubious assessment that unemployment is twice the stated rate).
- joe_the_user 16y ago
  That's one point that one could defend. The Shadow Government Statics site seems to put the current rate at about 23%. http://www.shadowstats.com/ http://www.shadowstats.com/ And sgs altogether makes a fairly plausibly argument... unlike parent article...
- yummyfajitas 16y ago
  (like the dubious assessment that unemployment is twice the stated rate). I've actually seen this claim made a lot, both in the media and on blogs. The basis for that claim is that the speaker believes U6 rather than U3 should be the official unemployment rate, and U6 is typically about double U3. [edit: See joe_the_user's post, which was submitted as I was writing this.]
seanmcq 16y ago
I think the key take away is, if he's arguing that ferociously that we're doing it wrong, he must be betting against what we're doing.

Miserlou57 16y ago

A good read, but it seems to idealize how America rose to such strength and gloss over how many serious problems came with it and the subsequent need for government to step in and protect (Labor laws, EPA, FDA, SEC, the list goes on...)

Entlin 16y ago

For people who like to read the original, here's the german version: "Amerikas europäische Krankheit" - http://www.spiegel.de/wirtschaft/soziales/0,1518,714521,00.html http://www.spiegel.de/wirtschaft/soziales/0,1518,714521,00.h...

zeteo 16y ago

I can't really evaluate the article on economic terms, but it fails miserably in its knowledge of history. If we are to believe prof. Straubhaar, in the 20th century "[t]he United States rose rapidly from virtually nothing to become the most politically powerful and economically strongest country in the world", by following the economics of some fuzzily defined American Way where "every man was responsible for himself -- in good times and bad. No one could count on government assistance". Then the good professor argues for a return to these good old times. The historical reality begs to differ. Far from being "virtually nothing", the US manufacturing output was the first in the world as early as 1890: http://en.wikipedia.org/wiki/Economic_history_of_the_United_States#The_Gilded_Age:_1865.E2.80.931900 http://en.wikipedia.org/wiki/Economic_history_of_the_United_... This economic growth was, by the way, happening behind some pretty heavy protectionist measures (initiated by none other than Lincoln): http://en.wikipedia.org/wiki/Tariff_in_American_history#Civil_War_protective_policy.2C_1861-1913 http://en.wikipedia.org/wiki/Tariff_in_American_history#Civi... But maybe this economics professor wasn't referring to economic output? Let's look at the principles that guided Franklin Delano Roosevelt, under whose leadership the US became acknowledged as a military superpower as well: "Throughout the nation men and women, forgotten in the political philosophy of the Government, look to us here for guidance and for more equitable opportunity to share in the distribution of national wealth" A complete opposite from the article's description of an ideology where "no one could count on government assistance"! In conclusion, the article's premises are based on a very shaky foundation and expose a shocking ignorance (for an economics professor, at least) of US history. And if the foundation is bad, I don't think the rest of the edifice hold up very well either.

deleted 16y ago
[deleted]
Andrew_Quentin 16y ago
All your points are fine, except for one. The article does not seek to enlighten or inform, but instead it seeks to influence, by whatever mean, for whatever reason. Thus the author is in no way to blame, but those in this community who up voted it.
- 16y ago

ancornwell 16y ago

I couldn't agree more. There was an article in the WSJ last week about the benefits of sleeping on the job. I'm sure it was read because it seriously clashes with the NY state of mind, but I saw some pretty supportive comments on Twitter from Californians and New Yorkers alike. I would never want my office to be in France where you get to work at 11, go to lunch and have a few bottles of wine from 12-4, and then take off at 5. I'm glad Sarkozy raised the retirement age to 62 though. I just don't want a culture swap, but it looks to be one of the many directions our melting pot could take. My french roommate used to put the eggs in the cupboard! Crazy! If I saw one of my employees put the eggs in the cupboard and then take a nap in my New York office, my brain would implode. I'm not suggesting to operate like a sweatshop and I'm aware that manufacturing power in the United States is quite volatile right now, but even when people focus on those right-brain activities, the earth still spins and capitalism still exists. Some of my best work is produced when my fatigue becomes delusion :D

ugh 16y ago
You are funny. I must say, those French are damn impressive. They work only ten hours a week (probably eight because – honestly – you just know that they will take fridays off) and still manage to be the fifth largest economy in the world. Isn’t that something we all should try to imitate, not scoff at?
- ancornwell 16y ago
  Sarkozy is trying to change social opinion of "careers" and "work" in France to keep pace with other countries. France is a very old country which also makes it even harder to bring change. I think there are a lot of people in France who pick up the slack for others. Kind of like the Israel... If there is a country we should imitate, I think it would be Israel. Now that's ambition, dedication, and of course, resilience. I think Tel Aviv has the highest concentration of tech startups in the world also. Why would you think French people only work ten hours per week? My French roommate never understood sarcasm either. He also kept putting the damn eggs in the cupboard even after I told him he would get sick.
  - 16y ago

ugh 16y ago

I’m confused, didn’t European nations have smaller stimulus programs compared to the United States? Isn’t he consequently arguing for the US to become more European in solving this crisis?

kthanx 16y ago
The funnt thing is that Germany had a BIGGER stimulus than the US. Look at the data of real government consumption of goods and services, it has risen more in “austerity” Germany than in the United States. Quarter Gemany US 2007Q4 100.0 100.0 2008Q1 100.4 100.6 2008Q2 101.5 100.8 2008Q3 101.7 102.2 2008Q4 102.5 102.9 2009Q1 103.6 102.5 2009Q2 104.2 103.8 2009Q3 105.1 104.0 2009Q4 104.8 103.9 2010Q1 106.9 103.8 2010Q2 107.3 104.5 Source: http://krugman.blogs.nytimes.com/2010/08/28/angela-and-the-fifty-hoovers/ http://krugman.blogs.nytimes.com/2010/08/28/angela-and-the-f...
- zyb09 16y ago
  But you have to consider that government spending in Germany is about 280 billion euros, while the US budget is at 3.8 trillion. It's a larger country and all, but these number are really out of proportion.
  - kthanx 16y ago
    German taxes as a percentage of GDP is 39.3%. The US number is 28.2%. Government income should be about the same as government expenditures, so that means that the German stimulus was even bigger than the number in my previous comment. http://en.wikipedia.org/wiki/List_of_countries_by_tax_revenue_as_percentage_of_GDP http://en.wikipedia.org/wiki/List_of_countries_by_tax_revenu...

nickpinkston 16y ago

His thesis of structural problems being a large part of the crisis (rather than simple systemic risk) is probably true though. The "fire" instead of "hire and fire" partially reflects that the unemployed aren't useful to employers. Yes, a sizable chunk is due to lower production due to the recession. Remember how this is the "man-cession"? This means construction and manufacturing. Productivity is up (and not only because people work harder to not lose jobs) due to a well-needed gutting due to having a good excuse. This is some painful creative destruction. Instead of pouring money out piecemeal, stimulus needs to address the structural issues: modernizing the workforce/education system, rearranging (cut/add) regulations, and useful infrastructure (e.g. not just fixing potholes).