Sunday, June 19, 2005
Getting real;
British officials are proclaiming that the summit fiasco creates an opportunity for Blair to lead Europe in a different, more ``modern,'' economically liberal (liberal in Europe maintains it’s 18th century meaning as market capitalism not neo-socialist as used by the American right) direction when he takes over the bloc's rotating presidency July 1.
They relish the sharpening ideological clash between their free-market philosophy and what they see as an outdated Franco-German model of social and rural protection.
``It's essentially a division between whether you want an EU that is able to cope with the future or whether you want an EU that is trapped in the past,'' British Foreign Secretary Jack Straw said. ``It is not one Europe can dodge.'' …
“Blair appears to be counting on a gradual change in the balance of power, with new, economically more liberal leaders in Germany and several central European states, to isolate Chirac - demonized in Britain as the embodiment of ``Old Europe'' and defender of fat subsidies for French farmers.”
The central issue the whole industrial world is how to encourage economic growth and maintain a fancy life style in the face of rough global competition from China, India, Korea, Brazil, south eastern Asia, and elsewhere. Italian made shoes at $100 can’t compete with imports at $20. Maybe they have to out source manufacturing but keep design and marketing. German and French (and American) auto makers can’t compete with in many cases newer and lower wages factories in Eastern Europe or Mexico without huge pension and health costs, and many restrictive union or government regulations. Now Boeing or Airbus has an edge as do many high tech products but not for ever. So what is to be done?
Progressives in North America and Europe (Clinton and Blair) look to a “knowledge society”. In this image the economic base are silicon valleys, big strong Universities training the world, research institutes churning out innovations in old and new technologies – genetic engineering, stem cells, information and communication systems, energy (including new forms of Atomic power such as pebbles) hydrogen systems, and the start up business in the new economy. By the way China, India, Japan, Korea, Singapore, and Brazil are all thinking the same thing. They do not want to just be the low cost producers of OEM commodities and low value added products in textiles but are looking ahead.
BUT as in any plan the people who benefit are in the future; the people that pay, suffer and hurt are here and now. Future beneficiaries can’t vote while French farmers sure can, and American Cotton growers, and protected industries, can make a big fuss. Modern capitalist societies can not afford the protections, the benefits, the privileges even with high taxes and growing deficits. Scandinavia is a special case where competition exists within a system of generous social benefits and high taxes of a welfare state. It worked for Germany and France in the past but no longer. They need to get real.
British officials are proclaiming that the summit fiasco creates an opportunity for Blair to lead Europe in a different, more ``modern,'' economically liberal (liberal in Europe maintains it’s 18th century meaning as market capitalism not neo-socialist as used by the American right) direction when he takes over the bloc's rotating presidency July 1.
They relish the sharpening ideological clash between their free-market philosophy and what they see as an outdated Franco-German model of social and rural protection.
``It's essentially a division between whether you want an EU that is able to cope with the future or whether you want an EU that is trapped in the past,'' British Foreign Secretary Jack Straw said. ``It is not one Europe can dodge.'' …
“Blair appears to be counting on a gradual change in the balance of power, with new, economically more liberal leaders in Germany and several central European states, to isolate Chirac - demonized in Britain as the embodiment of ``Old Europe'' and defender of fat subsidies for French farmers.”
The central issue the whole industrial world is how to encourage economic growth and maintain a fancy life style in the face of rough global competition from China, India, Korea, Brazil, south eastern Asia, and elsewhere. Italian made shoes at $100 can’t compete with imports at $20. Maybe they have to out source manufacturing but keep design and marketing. German and French (and American) auto makers can’t compete with in many cases newer and lower wages factories in Eastern Europe or Mexico without huge pension and health costs, and many restrictive union or government regulations. Now Boeing or Airbus has an edge as do many high tech products but not for ever. So what is to be done?
Progressives in North America and Europe (Clinton and Blair) look to a “knowledge society”. In this image the economic base are silicon valleys, big strong Universities training the world, research institutes churning out innovations in old and new technologies – genetic engineering, stem cells, information and communication systems, energy (including new forms of Atomic power such as pebbles) hydrogen systems, and the start up business in the new economy. By the way China, India, Japan, Korea, Singapore, and Brazil are all thinking the same thing. They do not want to just be the low cost producers of OEM commodities and low value added products in textiles but are looking ahead.
BUT as in any plan the people who benefit are in the future; the people that pay, suffer and hurt are here and now. Future beneficiaries can’t vote while French farmers sure can, and American Cotton growers, and protected industries, can make a big fuss. Modern capitalist societies can not afford the protections, the benefits, the privileges even with high taxes and growing deficits. Scandinavia is a special case where competition exists within a system of generous social benefits and high taxes of a welfare state. It worked for Germany and France in the past but no longer. They need to get real.
