I’m working (only in my head, for now) on a lengthy response (part agreement, part dissent) to Jim Manzi’s much discussed piece (and I’ll only start working on actually writing it once I finish a first draft of the screenplay, so send all your positive brainwaves that way, folks). I haven’t had time to follow discussion in the comboxes, but I am surprised that so much of the discussion has revolved around Manzi’s claim that aggregate GDP in Europe has not kept pace with that of America since 1980.
I mean, the claim just isn’t terribly important to the larger argument. It’s absurdly insufficient as a data point to persuade anyone that the American model is in some categorical way “better” than Europe’s at producing growth; and I can’t imagine anyone abandoning his convictions about the success of the “Anglo-Saxon” model if that particular prop were kicked out.
Think about this: what happened to the relative share of American and Japanese global GDP from 1960 to 1985? Does that “prove” that the Japanese corporatist model is superior to the American model? There were plenty of people in both Japan and America who thought exactly that in the 1980s; what do we think of them now?
But I think there’s another point to be made about Manzi’s comparison. As I think all have agreed, a substantial portion, probably the biggest portion, of the difference in share of global GDP between the US and our various European competitors – say, France, or Germany, or Italy, or whoever you like – relates to demographics. American population growth has outpaced European population growth; and the growth in the American workforce has outpaced the growth in the European workforce even more dramatically.
American population growth has not been driven primarily by natural increase, however; it has been driven by immigration. Immigration is one way a political entity can grow faster than its natural rate of population growth. But another way is by territorial expansion and absorption of the population of the absorbed territory. And this latter has been the strategy pursued by “Europe” if “Europe” is to have any real political meaning.
In my own opinion, if we want to compare the relative share of global economic power represented by “Europe” and America, we need to use a definition of “Europe” that has something to do with wielding power – that is, a political definition and not merely a geographic one. The obvious candidate for this purpose is the European Union and its predecessor institutions.
But the EU has not had a static membership. Just as America has grown through immigration, the EU has grown – substantially – through adding more members. Just as immigration has put some strain on the American social fabric, EU expansion has put some strain on the political fabric of the EU – take a look at the French reaction to the influx of Poles, or the increasingly unviable CAP. But in both cases, growth has meant greater aggregate economic power, and therefore greater global influence – where political institutions have been able to harness that power. This last is more the case in the USA than in the EU, with the notable exception of monetary policy, where the European Central Bank swings quite as big a club as the Fed, if not bigger, precisely because it is just as strong institutionally and has direct influence over a larger share of the global economy.
If what we’re trying to measure is which entity, relative to each other, is growing most or shrinking least in global influence, I think it is unarguable that Europe is outpacing America. The end of the Cold War and the integration of much of the former Warsaw Pact into “Europe”, and the simultaneous growth of European-wide political institutions (at least at the level of economic policy-making), has dramatically increased Europe’s global influence. Whether this political project is going to reach the point of diminishing returns is another question – and a good one. I’m a skeptic that “ever closer union” and “ever expanding union” can work together over the long term, and I think the former is more important at this point than the latter for the development of functional and responsive political institutions. Moreover, given the demographic profile of most of the likely candidates for future expansion, it’s not obvious that expansion in this manner will in fact grow Europe’s labor force quickly enough (and the big demographic exception – Turkey – poses its own problems). But the fact remains: in 1980 there barely was a “Europe” in a political sense, and now there is one, and the one we have now is substantially bigger.
I don’t think I’m making a controversial point here. Germany, in 1980, was divided. Its political influence was severely limited by this fact – West Germany was acutely aware of its dependence on America; East Germany was utterly dominated by the Soviet Union. When West Germany absorbed the East, integrating it into its preexisting political and economic order, it caused considerable economic hardship; German growth was basically stalled for a decade. But every observer understood that this was a move that increased a now-united Germany’s economic and political clout. And Germany – as a political entity within a larger European political entity – is reaping the benefits of that greater clout today. The same is true for Europe as a whole. The expansion of “Europe” – first southward to encompass Spain, Portugal and Greece, then eastward to encompass the Warsaw Pact countries of central Europe – has, whatever the other consequences have been, resulted in a relative increase in “Europe’s” clout on the global stage.
If we’re going to consider America’s growth through immigration as one component that contributes to our national power, we should consider Europe’s growth through absorption of other countries as one component that contributes to theirs.