Europe Is the New World, Not the Old

Steven Hill on his book “Europe’s Promise: Why the European Way is the Best Hope in an Insecure Age.”

In a Nutshell

While Europe is considered the “old world,” it is the United States that is actually far older. The European Union in its current configuration of 27 member states and 500 million people dates back only to 2004.

My book is about a “Europe” fundamentally different from its previous incarnations, reconstructed from the rubble of World War II with America’s generous assistance. It is the story of how post-World War II Europe has transformed itself from the military warring machines its nations had been for centuries, into a model for how a modern society can develop itself, take care of its people, foster “peace and prosperity partnerships” with its neighbors and region, and do all that in a way that is as environmentally sustainable as possible. For a decade I traveled widely across the continent to understand this uniquely European Way that, I concluded, has taken the lead in this make-or-break century challenged by a worldwide economic crisis, global climate change and new geopolitical tensions.

Yet these changes mostly have taken place under the radar, misreported by the media and misunderstood by the American public and its leaders. Because modern-day Europe is so new and still in formation, journalists can’t figure out if Europe is a single nation or a confederacy of individual nations. Increasingly the answer is “both,” confusing many reporters who don’t quite know how to report on Europe because of this duality. As a result, numerous myths and half-truths about Europe now pass as conventional wisdom, and these myths have clouded Americans’ perceptions and understanding.

Thus, in “Europe’s Promise” I undertook the task of chronicling and illuminating for readers Europe’s quiet revolution that is proposing a bold new vision for human development at a crucial juncture in global affairs. A world power has emerged across the Atlantic that is recrafting the rules for how a modern society should provide economic security, environmental sustainability and global stability for its many peoples. History is in the making, and those paying attention have ringside seats.

The Wide Angle

The world faces two major challenges in the 21st century. First, how do we advance the institutions and practices capable of enacting a desirable quality of life for a burgeoning global population of 6.5 billion people? And second, how do we do all that in a way that does not exacerbate the severe impacts of global warming and environmental degradation? Put another way, how do we allow China, India, Brazil and other countries to come up in the world without burning up the planet in a Venus atmosphere of our own creation?

It is a tall order—yet also the defining task of the 21st century. And more than anyone, Europe has forged the types of innovations and institutions that point the way forward for the world to meet these twin challenges.

“Europe’s Promise” details how Europe’s leadership manifests in several major areas:

Economic Strength

Europe is now the world’s largest trading bloc, producing nearly a third of the world’s economy, almost as large as the U.S. and China combined. Europe has more Fortune 500 companies than the U.S. and China together, and more small businesses creating two thirds of the jobs in Europe, compared to only half the jobs in the U.S. Europe is the largest trading partner with both the U.S. and China, and had a higher per capita annual growth rate than the U.S. from 1998-2008 (until the global economic collapse). And currently the continent previously known as the land of high unemployment has a lower unemployment rate than the United States. So contrary to the myths and stereotypes, Europe’s economy is robust and competitive, producing a great deal of wealth. This is not socialism, as some have claimed, it’s fully capitalist in its orientation.

Social Capitalism and Real Family Values

While Europe is fully capitalist, it has a different brand than America’s “Wall Street capitalism.” I call it “social capitalism,” because the genius of Europe is that it has figured out how to harness capitalism’s tremendous wealth-creating capacity so that its benefits are broadly shared. Hardly a “welfare state,” Europe has created an ingenious “workfare” framework that better supports families and individuals to help them stay healthy and productive, which is especially important during this time of economic crisis.

Better Health Care

Part of Europe’s social capitalism includes having health care systems that have been rated by the World Health Organization as being the best in the world. Yet they spend far less per capita than the United States for universal coverage, even as U.S. health care is ranked 37th—just ahead of Cuba and Kuwait.

Readying for Global Warming

Not only is Europe’s economy robust, and not only has it figured out how to harness capitalism to foster a more broadly shared prosperity, but Europe is figuring out how to do that in a way that is as environmentally sustainable as possible. Europe has deployed widespread use of renewable energy and conservation technologies which has resulted in an “ecological footprint” that is half that of the United States for the same standard of living. The European landscape is being transformed slowly by giant high-tech windmills, vast solar arrays, underwater seamills, hydrogen-powered vehicles, “sea snakes,” and other renewable energy technologies. While renewables grab the headlines, even more significant has been Europe’s leadership in implementing conservation and “green” design in everything from skyscrapers to homes to fuel-efficient automobiles, high-speed trains, low wattage light bulbs, and low flush toilets. Europe has gone both high- and low-tech: it also has developed thousands of kilometers of bicycle and pedestrian paths that are used by people of all ages. In the process, the greening of the economy has created new industries and hundreds of thousands of new jobs.

Innovative Foreign Policy

Europe is transforming our very notions of “effective power.” With America’s “hard power” suffering setbacks, Europe’s “smart power”—based on regional networks of nations and Europe’s own Marshall Plan for development—has produced a “Eurosphere” with some 2 billion people (one third of the world) linked by trade, aid, and investment to the European Union.

“Europe’s Promise” shatters several myths, such as the one about Europeans paying more taxes than Americans. The fact is that, for their taxes, Europeans receive a seemingly endless list of supports and services for families and individuals—quality health care, decent retirement, more vacation, paid parental leave, paid sick leave, free or nearly free university education, housing assistance, senior care, job training and much more—for which Americans must pay extra for, out-of-pocket, via escalating health care premiums, fees, deductibles, tuition and other charges, all in addition to our taxes. When you sum up the total balance sheet, you discover that many Americans pay out as much as or more than Europeans—but we receive a lot less for our money.

Europe has pioneered new forms of social, political and economic innovations such as: codetermination, which allows the workers in major corporations in Germany, Sweden and elsewhere to elect up to 50% of the corporate board of directors (imagine Wal-Mart being required by law to allow its workers to elect 50% of its board of directors—the impact would be immense); proportional representation, public financing of campaigns, and free media time that fosters multiparty democracy, higher voter participation, a better informed populace, and policy shaped by broad consensus; cogeneration, which redirects wasted heat from power plants (that usually is lost up the chimney flue as exhaust) into pipes that can bring that heat to homes and buildings, thereby greatly increasing energy efficiency; nonprofit private insurance companies that deliver health care and which, along with negotiated fees for all medical services, keep costs down to a fraction of what Americans pay, even as they produce better health for people than America’s for-profit health care system.

Because modern-day Europe is so new and still in formation, journalists can’t figure out if Europe is a single nation or a confederacy of individual nations.

A Close-Up

If a browsing reader were to encounter “Europe’s Promise” in the bookstore, I would like her or him to read the final few pages, and contemplate the final scene and probing question that ends the book:

So now, whenever I am in Europe, whether in Paris, Amsterdam, Brussels, Stockholm, London, Rome, Prague, Oslo, Berlin, Vienna, Barcelona, Ljubljana, Budapest or elsewhere, at some point in my journey I always make a point to stand on a street corner and stop and look around me at all the people milling about. I watch them for a few minutes, take a deep breath, and, remembering Matthias’ words I think to myself, “Everyone I see, all those people walking by, no matter their age, gender, religion, or income, has the right to go to a doctor whenever they are sick. And all those I see have a decent retirement pension waiting for them, and parents can bring their children to day care, or stay home to take care of themselves or their sick loved one, and get paid parental leave or sick leave and job retraining if they need it, and an affordable university education.”

Of course, not every European country, or every region or city within each country, lives up to every aspect of this menu 100 percent of the time. Economic fluctuations will always result in contractions and expansions of the social agenda. That’s to be expected. But all of them, even the poorer countries among them, achieve a far higher level than the United States can muster, and the arc of their trajectory is clear.

At the end of the day, the clever Europeans have crafted something that we have not yet figured out how to do in the United States. Their social contract is still vibrant and durable, and that’s worth contemplating as I stand on street corners in Europe, with the memory of Matthias’s words ringing in my ears: “In America, you are so rich—why don’t you have these things for your people?”

Lastly

Many of the reviews in the media have captured well the book’s larger context, implications, and significance.

Financial Times:

Steven Hill is surely right in saying that Europe’s prosperous, peaceful and democratic social market economy looks attractive when contrasted with the unbalanced, excessively deregulated US model or with China’s politically repressive capitalism. He is a lucid and engaging writer…he makes you sit up and think.

Reuters International:

“Europe’s Promise” marshals an impressive army of facts and comparative statistics to show that the United States is behind Europe in nearly every socio-economic category that can be measured and that neither America’s trickle-down, Wall Street-driven capitalism nor China’s state capitalism hold the keys to the future. (February 2010)

Foreign Affairs:

In this timely and provocative book, Steven Hill…argues that the “social capitalist” policies of European countries represent best practices in handling most of the challenges modern democracies face today…. “Europe’s Promise” explains why in most areas, it is Europe’s constitutional forms, economic regulations, and social values, not those of the United States, that are the most popular models for new democracies. The oldest one should take note.

Reuters International:

“U.S. militarism has long been a core part of the American Way,” writes Steven Hill in a just-published book, “Europe’s Promise,” that compares the United States and Europe. Militarism does “triple duty as a formidable foreign policy tool, a powerful stimulus to the economy, and a usurper of tax dollars that could be spent on other budget priorities.” (Feb. 5, 2010)

Hendrik Hertzberg, The New Yorker:

Like a reverse Alexis de Tocqueville, Steven Hill dauntlessly explores a society largely unknown to his compatriots back home. Sweeping away the ideological posturing, he shows us exactly how the modern European Way works and the promise it holds for an America which has slipped to become, in terms of social, economic and energy policy, the Old World.