USA Adopting Europe’s Welfare System?

Katrin Bennhold contends that, as the world’s economic elite gather in Davos for the annual World Economic Forum, there is decidedly less Europe-bashing than in years past. After the global financial shake-out of the past  year, she wonders, “Could Europe’s much-reviled social welfare system actually end up being the model for the 21st century world?”

My New Atlanticist response piece, “Europe’s Welfare System Model for USA and China?,” argues that this is incredibly unlikely, concluding, “While market shocks and financial crises are quite painful, capitalism has been berry, berry good to us, giving us the most powerful economy economy and the fastest growing economy, respectively, on the planet.”

Much more analysis at the link.

FILED UNDER: Economics and Business, US Politics, World Politics, , ,
James Joyner
About James Joyner
James Joyner is a Security Studies professor at Marine Corps University's Command and Staff College and a nonresident senior fellow at the Scowcroft Center for Strategy and Security at the Atlantic Council. He's a former Army officer and Desert Storm vet. Views expressed here are his own. Follow James on Twitter @DrJJoyner.

Comments

  1. Our Paul says:

    Sigh, two days have passed and nary a correspondent has taken pen in hand to comment on this post. I guess it has fallen on my shoulders, for certainly we should not let this provocation pass.

    Why does this article by Katrin Bennhold deserve to be brought to our attention? The teaser is right there to get our juices flowing:

    “Could Europe’s much-reviled social welfare system actually end up being the model for the 21st century world?”(My italics, OP)

    Off to Katrin’s article in the International Herald Tribune with heart a thumping and palms beginning to sweat…

    Not much luck there, a diligent slow paced read informs us that (1) no one is identified as a member of the “reviling” crowed, (2) no parts of the “social welfare system” that is under attack is mentioned. We do find this startling statement:

    ”We’re moving back towards a mixed economy,” said Daniel Yergin, chairman of Cambridge Energy Research Associates in Boston and the author of “Commanding Heights,” a history of the last-such paradigm shift, the one toward wider acceptance of the market-driven economy.”

    The new shift is likely to go well beyond expensive short-term fixes. The ferment suggests that ultimately the United States may move closer to Europe, altering the trickle-down economic doctrine of the past three decades and establishing a new social contract aimed at narrowing the gap between the rich and the rest of society, officials and economists say.

    As one reads on, the question that is being posed, is whether (gasp) the U.S. and China will move more towards a Euro welfare system, which is never quite defined. But then, the title of James post posits precisely that!

    The answer can perhaps be found in the link to the New Atlantacist, wich James urges us to explore. And there, in his closing paragraph, we find this:

    “Will both strengthen their safety nets and tighten their regulatory oversight somewhat? Almost certainly. Will either the United States or China emerge from the current crisis indistinguishable from Sweden? Not likely. While market shocks and financial crises are quite painful, capitalism has been berry, berry good to us both, giving us the most powerful economy and the fastest growing economy, respectively, on the planet.”

    And thus, it boils down to this: “capitalism has been berry, berry good to us”, us is not defined, but you do not have to be an economist at Davos to know that it is only the upper income 2 to 3% of the population that James is talking about. The rest of us are drifting twords Third World status.

    Of course, when the issue is the dreaded black beast of socialism (what ever that means) is brought forward, Sweden is presented as the blackest of the socialist bête noires. And thus, only a few questions (although more could be presented:

    (1) In the past 5 years, in world ranking, what was Sweden’s GDP ranking in comparison to other industrialized countries? Did it ever exceed the U.S.?

    (2) How many families in Sweden have been forced to declare bankruptcy due the accumulation of health care debt?

    (3) How many young people are being excluded from University education by economic factors and what is the average debt of, let’s say, a graduating doctor in Sweden and the US.

    Bah, humbug!!! The New Atlanticist is geared to provide us with information about Europe and provide an analysis of how we can learn from each other. This is an example?