It’s a fair bet that every American who’s travelled outside the United States has heard people complaining about their societies becoming “Americanized.” By this, they usually mean the proliferation of things such as American television and fast-food chains (though that rarely stops them from watching Hollywood films or eating McDonald's).
More recently, however, millions of Americans have begun wondering if our own country is becoming “Europeanized.”
In one sense, to say that America is becoming like Europe seems odd. After all, when it comes to its dominant political ideas, religious culture, institutions and history, America is obviously Europe’s child.
That, however, is not what Europeanization means today. Instead it’s about the spread throughout America of economic expectations and arrangements directly at odds with our republic’s founding. These lead to the prioritizing of economic security over economic liberty; to the state annually consuming close to 50% of GDP; to the ultimate economic resource (i.e., people) aging and declining in numbers; to extensive regulation becoming the norm; and perhaps above all, to a situation in which economic incentives lie not in work, economic creativity and risk-taking, but rather in access to political power.
Unfortunately there’s a great deal of evidence suggesting America is slouching down the path to Western Europe. In practical terms, that means social-democratic economic policies: the same policies that have turned many Western European nations into a byword for persistently high unemployment, rigid labor markets, low-to-zero economic growth, out-of-control debt and welfare states, absurdly high tax levels, growing numbers of well-paid government workers, a near-obsession with economic equality at any cost and, above all, a stubborn refusal to accept that things simply can’t go on like this.
It’s very hard to deny similar trends are becoming part of America’s economic landscape. States like California are already there — just ask the thousands of Californians and businesses who have fled the land of Nancy Pelosi.
Europeanization is also reflected in the refusal of so many Americans to take our nation’s debt crisis seriously. Likewise, virtually every index of economic freedom and competitiveness shows that, like most Western European nations, America’s position vis-à-vis other countries is in decline.
Between January 2008 and January 2011, for example, there was a marked growth in the amount of regulation in America — the pace being almost 40% more than the annual rate of increase between 1992 and 2008. Similarly, between 2008 and 2011 the number of people working in federal government regulatory agencies rose by 16% — a total of more than 276,000 people — at a time when private-sector employment was falling.
It’s no wonder the Nobel economist Robert E. Lucas asked in his 2011 Milliman Lecture at the University of Washington whether America was now “imitating European policies on labor markets, welfare and taxes.”
Such trends are deeply troubling. But here’s the good news. First, there remain many ways in which America has not succumbed to eurosclerosis. Risk-taking and entrepreneurship-levels remain, for example, much higher than in Europe. America’s labor markets also remain more flexible than those of Europe (despite American unions’ best efforts to the contrary).
Second, the problems of nations like Greece, Italy, Spain, Britain and France are functioning as a type of early-warning system. They’re enough of a “canary in the coal mine” to help us make the right decisions and get back to the principles that made the United States an economic superpower.
And this is the choice which increasingly faces America. We can either continue our long march towards a form of social democracy presided over by an all-pervasive European-like political class and associated insider-groups; or, we can embrace a dynamic market economy that takes liberty seriously and understands that government intervention in the economy must and can be limited.
Of course making such a decision isn’t simple. It involves trade-offs, the prioritization of different values, and fundamental disagreements about the role of government. And these discussions go beyond economics. They are arguments about what type of economic culture we want America to embrace and reflect to the millions throughout the world for whom the United States remains a lodestar for freedom.
But make no mistake, time is running out for America. We don’t have to become Europe. Yet the deeper the debt, the bigger the entitlements, the greater the regulations, and the more Americans look to government for their economic salvation, the harder it becomes for America to turn back from the road to permanent economic decline.
A great European and honorary American citizen Winston Churchill once said: “You can always count on Americans to do the right thing — after they’ve tried everything else.” I hope and pray he’s still right.
This article originally appeared in the New York Post.