EUROPEAN FOLLIES

Hooray! "The leader of France's ruling party has privately admitted that Sunday's referendum on the European constitution will result in a "no" vote, throwing Europe into turmoil. "The thing is lost," Nicolas Sarkozy told French ministers during an ill-tempered meeting. "It will be a little 'no' or a big 'no'," he was quoted as telling Jean-Pierre Raffarin"

Why Europeans are getting disillusioned with the EU: "I have always argued against economic determinism in British or US politics. But that is because the British and American economies have on the whole been performing well since 1992. Europe, meanwhile, has become an economic disaster. The people of France, Germany, Italy and the Netherlands may be angry about globalisation or ultra-liberalism or immigration, but this reflects a deeper malaise. Their living standards are falling, their pensions are in danger, their children are jobless and their national pride is turning into embarrassment and even shame. In sum, they feel that their countries, which numbered among the world's richest and most powerful nations as recently as the middle of the last decade, have gone to the dogs under the leadership of the present generation of politicians. And, at least in the economic sense, they are absolutely right".

Europe no model for anyone: "American progressives continue to advocate that the United States should move more toward Western Europe's larger social welfare states and greater job protections.... In the 1990s, the U.S. economy experienced a quantum increase in productivity. European investment in information technology as a percentage of gross domestic product is considerably less than in the United States and is declining. The European Commission estimates that, as of this year, labor productivity per hour in the European Union will have declined from 97 percent of the U.S. level in the mid-1990s to only about 88 percent.... European leaders have a very difficult political path to tread. There appears to be great reluctance by their publics to give up any of the security, protections and benefits of the social model. Yet without higher economic growth, the model is unsustainable. But higher economic growth requires reforming the model."

Dutch democracy?: "Sophie In 't Veld, an MEP for junior coalition party D66, explains in the Algemeen Dagblad that in the case of the EU referendum she even thinks that voting could actually be undemocratic... at least if people are planning to vote 'no'. According to Ms In 't Veld, the problem is that all 25 EU members need to ratify the EU constitution before it can come into force. So if the Netherlands turned out to be the only country voting 'no', then this tiny little blot on the map would single-handedly block the will of the others. And that, Ms In 't Veld argues, would be undemocratic... so in order to be good democrats, people should either stay at home or vote 'yes' as the government wants." (Via No Pasaran).

A market solution to Germany's 12% unemployment: "A young entrepreneur is enjoying success in Germany after developing a website that allows people to bid for work by undercutting others. He is now in talks to set up so-called "job-dumping" sites in other countries. Jobdumping.de, set up by student Fabian Loew, has been flourishing in a country where five million - nearly one in eight workers - are unemployed. The site works much like a traditional online auction site, except in reverse - jobs are advertised, and then the lowest bidder - ie the person willing to do the job for the least amount of money - wins."

Germany invented socialism: Karl Marx and Friedrich Engels were Germans. The Social Democratic movement that shaped the modern European welfare state also originated in Germany. Although the country profited greatly from its reintegration into the world trading system after World War II, Germany never really came to terms with Anglo-Saxon capitalism and skepticism about it still runs deep.... This new critique of capitalism recently culminated in a series of attacks by the leader of the Social Democratic Party, Franz Muentefering. He accused entrepreneurs who outsource production to low-wage countries of showing excessive greed and lack of social responsibility, and he compared the managers of international equity funds to a plague of locusts that occupy companies, exploit them, and move on after their destructive work is done. These attacks brought Muentefering vast public support... Now unemployment is Germany's biggest problem, standing at a postwar record. This alarms the public and incites anger against capitalists who do not reinvest their profits. Muentefering simply caught the popular mood in developing his theory of locust capitalism. But this useless reaction to the laws of the global market economy hides the fact that Germany's problems are largely a result of an overblown welfare state and extremely aggressive union policies over the last thirty years." [And I don't suppose that we want to draw the parallels with National Socialism do we?]

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