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Challenging the Narrative of European Decline

paulkrugman.substack.com

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Re: Challenging the Narrative of European Decline

#21

Post by rob74 »

ragebol wrote: post #16

> 10% of the US economy is IT The US is the IT-supplier of the world. I don't know how large a % of that comes for outside the US. But with all the 'shenanigans' of the Trump regime and the trust the US has lost due to that, that should lead to losing IT business from the rest of the world. In other words, If Europe would disavow using US IT, as would be the wise choice I think, then Europe might close the gap. I jus…

More pertinently, at the moment 100% of US economic growth is IT (or more precisely, AI). Let's see for how long...

Re: Challenging the Narrative of European Decline

#22

Post by lp4v4n »

As someone who lives in Europe, my impression is that the continent's first priority is how to keep paying the fat pensions it pays to its retired class, the second priority is how to keep paying the pensions followed by a distant third about how to keep paying the pensions.

For me it's remarkable how the continent lives looking at the past and not at the future. The older people I talk to show no concern about Europe's economic future, they're always dismissive about the problems Europe faces. They're stuck in the 70's, 80's or 90's it seems.

Re: Challenging the Narrative of European Decline

#23

Post by pjc50 »

stevesimmons wrote: post #15
pirate787 wrote: post #3

Krugman so badly wants this to be true. But handwaving away massive difference in IT innovation and in practical data like housing size and vastly greater American consumption does not make it true. Just 20% of European homes even have air conditioning. European industrial energy costs are more than 2x the U.S. Don't ignore the data. Europe is behind and falling behind at an ever-faster clip. And the strategic issues…

I don't buy into this critique at all... I live in two cities in Europe. I like our size of houses. I like not needing to own a car. I like that in both of the cities I live in there are 8 supermarkets within ten minutes walk. I like that I never have to think about healthcare costs. I've never felt the need for air conditioning. And when I see Americans' lives, they seem full of crappy stuff that I have no need for,…

I think it's valid to question whether and how GDP translates into happiness, but America (as a whole) does just have .. more and bigger.

We will eventually start cottoning on to air conditioning as people realize it's a bidirectional solution that can warm you in the winter. The need is genuinely less than the US as Europe is both further north (New York is the same latitude as Lisbon) and currently benefiting from the Atlantic evening out the temperature.

Re: Challenging the Narrative of European Decline

#24

Post by RicoElectrico »

The apologetism of American socioeconomic system is a thing endemic to HN. Even Reddit with its USA-skewed demographic is far less delusional, for all its other faults. Same for other social media like YT. I suppose it's a distinction of well-to-do SWEs (and VCs alike) vs actual working class majority.

Re: Challenging the Narrative of European Decline

#25

Post by bilekas »

pirate787 wrote: post #3

Krugman so badly wants this to be true. But handwaving away massive difference in IT innovation and in practical data like housing size and vastly greater American consumption does not make it true. Just 20% of European homes even have air conditioning. European industrial energy costs are more than 2x the U.S. Don't ignore the data. Europe is behind and falling behind at an ever-faster clip. And the strategic issues…

This comment probably won't go down well but your point irked me.

> And the strategic issues of continued vast unskilled migration into Europe

If only there wasn't a global power invading countries for oil reserves over the years and causing mass migration and destabilising those places?

Also have you considered 100% of the EU doesn't NEED air conditioning?

Come back when you have a minimum wage and universal healthcare. Your IT comment forgets the fact that the US allows tech companies to do whatever they like all in the pursuit of "progress" when infact you're in a situation now that your personal privacy is a memory of a dream.

Re: Challenging the Narrative of European Decline

#26

Post by pjc50 »

lp4v4n wrote: post #22

As someone who lives in Europe, my impression is that the continent's first priority is how to keep paying the fat pensions it pays to its retired class, the second priority is how to keep paying the pensions followed by a distant third about how to keep paying the pensions. For me it's remarkable how the continent lives looking at the past and not at the future. The older people I talk to show no concern about Europ…

Now wondering: is the US "richer" because its pensioners are "poorer"? Because that doesn't quite seem to be the case. I'm not familiar with US pensions discourse. I suspect if you count Medicare (14% of Federal spending, 3% of GDP) as a type of "pension" the situation looks different.

Re: Challenging the Narrative of European Decline

#27

Post by hnmullany »

lp4v4n wrote: post #22

As someone who lives in Europe, my impression is that the continent's first priority is how to keep paying the fat pensions it pays to its retired class, the second priority is how to keep paying the pensions followed by a distant third about how to keep paying the pensions. For me it's remarkable how the continent lives looking at the past and not at the future. The older people I talk to show no concern about Europ…

You might want to look up the value of those "fat pensions" - a lot of them are substantially less than US Social Security.

e.g. in Ireland, the state contributory pension (aka what you paid egregious social security taxes for) maxes out at about $18,000 per year. The equivalent pension from US Social Security is about $45,000.

Re: Challenging the Narrative of European Decline

#28

Post by noduerme »

comrade1234 wrote: post #8

"When we compare the European, or at least northern European, economy with that of the United States some points should be indisputable." So is he comparing Europe to the USA or just Northern Europe? And is he including Switzerland, Norway, Iceland, etc or just the EU? It's rather confusing and I wouldn't even know where to begin in trying to do these comparisons. I live in Switzerland and have worked on projects all…

Americans, who mostly have no experience living or traveling abroad, can be counted on to not be able to find any of the countries you mentioned on a map. They either view all of Europe as either a sort of socialist utopia with fancy prisons and decent healthcare, or else as a bureaucratic disaster of taxes and restrictions. Although some will also say it's merely a museum. (I personally think it's a bit of all those things).

To be clear, though, Paul Krugman doesn't need to be specific at all, because he's simply pandering to one specific audience in America who hold one specific one of those stereotypes.

Re: Challenging the Narrative of European Decline

#29

Post by comrade1234 »

pjc50 wrote: post #12

> Yet productivity growth as conventionally measured has in fact been much faster in the US than in Europe. How can this be consistent with the fact that there has been virtually no change in the relative value of goods produced per hour? That’s the apparent US-Europe paradox. What explains it is the fact that the US and European economies produce different mixes of goods – a qualifier that is not picked up in the co…

I understand your point but YouTube isn't a good example as it has its global development team headquartered here in Zürich.

Multinationals really confuse comparisons - when I bought a macbook here in Europe it got shipped to me directly from china. My money went to apple Switzerland. At no time in the process was the USA involved.

Re: Challenging the Narrative of European Decline

#30

Post by piva00 »

RandomLensman wrote: post #9
piva00 wrote: post #6

Earlier quoted context omitted.

Air conditioning is not needed in most of Europe, no idea why that would be a measurement of economic advancement. Krugman presented arguments with data, it'd be nice to see your data that counters Krugman's argument, not a whole different set of measurements that you are defining as the basis of comparison. It's just a strawman with makeup.

Most of Europe doesn't need air conditioning? By what measures/what large countries don't have any need there?

Poland, Germany, Switzerland, Benelux, the Nordics, Baltics, most of Central Europe don't have a need for AC. It might make life more comfortable during some days of heatwaves but it's definitely not a need to survive.

Southern Europe has experienced more scorching heat the past 1-2 decades and AC is going to become a necessity given the trend of climate warming but it's not Arizona.

Also I think people aren't aware that the USA doesn't use the same methodology to count heat-related deaths, a heart attack from someone working out in the fields on 35C+ weather is not counted as heat-related, Scientific American published an article about it back in 2024[0].

[0] https://www.scientificamerican.com/article/u-s-deaths-from-h...

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