'The GDP gap between Europe and the United States is now 80%' [Paywall]
'The GDP gap between Europe and the United States is now 80%' [Paywall]
COLUMN. As after every crisis, Europe has been stalling since Covid-19, observes Arnaud Leparmentier, Le Monde's correspondent in New York.
This topic is muted in France – immediately met with counter-arguments about life expectancy, junk food, inequality, etc.
Those pesky things like quality of life indicators. Everyone knows there's only one number that matters and that's how much money you have in dollars, right? And by you, we mean the top 1%. /s
Well said!
Mean and median household income is also much higher, and disposable income (so after taxes, housing and insurance) is also higher.
But that’s beyond the point. GDP maybe a catch-all indicator and not a measure of quality of life, but it is also the result of the American supremacy over science and technology.
The US has always attracted the brightest minds of the world with its huge salaries and colossal investments in R&D, and continues to do so while Europe shows no signs of catching-up. If the EU wants to keep the way of life it provides its citizens and stay relevant on the international stage, it has to rise-up to the challenge. It lost the tech race and now it is losing IA race.
GDP measures the strength of the economy. The only thing the EU has to do to keep its quality of life, is to have a stable GDP per capita. Obviously having a stronger economy is helpfull, but it comes at a price. For example Germany is pretty close to as efficent as the US in terms of GDP per hour worked. It is just that Germans do not work as much as Americans, due to choosing to have more vaccation time and shorter workweeks on average. Hardly an awfull choice. To use another example. In the US you have to have a car, as everything is extremly car centric, but in the Netherlands you can just ride your bike to work. A car costs more then a bicycle and it requires fuel. Even better cars make people sick, due to bad air quality and well accidents. So bicycles, whcih provide light exercise actually are bad for the economy, as fewer workers are needed to put them together, provide fuel and provide medical services. There is a lot of stuff like that.
This is not to say that Europe can learn nothing from the US. The US ability to create innovation is great and only matched by a few European countries. That being said, looking only at GDP is like judging somebody only by their income. It just does not tell you, how good their life really is.
Comparing disposable income between US and EU is misleading, because Europeans are forced to pay for things like health insurance or unemployment insurance, while US-americans are free not to have them (and suffer the consequences). In reality every US-american that can, does pay for health insurance, and pays significantly more for worse coverage than Europeans. But in the statistic this is counted as a voluntary expense which is why the disposable income metric is misleading. There is more, like saving for the university education of the children, which again would be counted as disposable income. Europeans get uni education "for free".
That's a really misleading article. Badly written and polarizing by leaving out crucial information. It's basically clickbait.
The GDP per capita, adjusted for purchasing power, in the US was at $76,398.6 in 2022, while the Euro Area had $56,494.2 and the EU $54,248.6. A gap is there but it's not nearly as dramatic as this article makes it sound.
(I'm sure most of you know this, but I'm still clarifying for the few who don't.)
And even that doesn't take into account that there are much more super rich people in the US making an insane amount of money.
I don't have any statistics but I would guess the median income in the US probably isn't that high compared to their cost of living.
That's a 35% difference! And again, of course the disposable income in Europe is more than adequate, but what about technology? Europe is lagging everywhere : computers, phones, space, IA, etc.
Permanently Deleted
That’s a 35% difference!
Relative difference between two values depends on the perspective. These numbers mean that the purchasing power in the USA is 35% higher when compared to the EU. Conversely, it means that the purchasing power in the EU is 26% lower when compared to the USA.
Math is fun. As a rule of thumb: If you have one third more than someone else, he has one quarter less than you. Perspective is often used in journalism to scew statistics without lying, so it's nice to be aware.
The same is true for the "80% gap" posted in the headline of the original article. Without direction, a relative difference is incomplete.
Space? Europe recently landed on a comet, something no one else has done, something even NASA has never achieved.
Rosetta was the first spacecraft to orbit a comet nucleus, and was the first spacecraft to fly alongside a comet as it headed towards the inner Solar System. It became the first spacecraft to examine at close proximity the activity of a frozen comet as it is warmed by the Sun. Shortly after its arrival at 67P, the Rosetta orbiter dispatched the Philae lander for the first controlled touchdown on a comet nucleus. The robotic lander's instruments obtained the first images from a comet's surface and made the first in situ analysis of its composition.
https://en.m.wikipedia.org/wiki/Rosetta_(spacecraft)
Furthermore, do you know who makes the machines that TSMC uses to create the chips that power the worlds smartphones and countless other devices? A European company. Yes Taiwan makes the CPUs, but we make the CPU makers.
Europe is lagging everywhere : computers, phones, space, IA, etc.
Ehhhh silly take imho because while most of the big tech companies are headquartered in the US, microchip and computer technology is a massive multinational effort.
Europe is arguably more important, because it's home to way more open source and open hardware initiatives, and the EU is actually regulating important sustainable pro-consumer features like replaceable batteries.
If you don't want to see giant companies lock down every feature into a subscription (become a silver monthly member and unlock heated seats in your car!), then we need open source.
Lotta good that higher GDP is doing the lower class in the US right now
It would be fun, but only for a few minutes. The security and prosperity of Europe depends on the alliance with the USA, whether we like it or not. Could we survive without them? Of course. But we'd be more vulnerable and less rich.
Why does it feel like I'm reading a weird right wing paper from France? This thing kind of reads like propaganda. America might have 14 trill gdp but our debt is higher...
Especially since government spednign might not be wise. Perfect current example is Russia. The GDP is not falling due to the government spending a lot of money on the war against Ukraine. I somehow doubt that building tanks, to be blow up by Ukranian artillery is making the next generations of Russians richer.
I heard somewhere that when the gdp measure was created some people advocated that the military expenditure should be subtracted from the total gdp as it is produced to be destroyed. So it would be fun to have a gdp graph where this is reflected.
Sure but Russia still managed to cut its losses. With the amount of sanctions it has to face and the cost of war, Russia should have crumbled by now, but thanks to their original low debt they managed to save their economy (at least in appearance). They may get their reckoning but their investment policy helped them resist the huge pressure the Western World put on them. Sure, they are only buying time, but imagine what Europe would do with that kind of ballsy investment policy.
What has the debt to do in anything whatsoever?
all i want in this life is to see the US collapse
You probably wouldn't like the outcome
I'm already eating my popcorn as it happens.
The Americans don't care about these issues. They have inexhaustible energy resources, as the producers of 20% of the world's crude oil, compared with 12% for Saudi Arabia and 11% for Russia.
Well, France, US oil production surged because the US made use of hydraulic fracturing.
https://en.wikipedia.org/wiki/Fracking
France
Hydraulic fracturing was banned in France in 2011 after public pressure.[8][26][27][28] It was based on the precautionary principle as well as the principal of preventive and corrective action of environmental hazards, using the best available techniques with an acceptable economic cost to insure the protection, the valuation, the restoration, management of spaces, resources and natural environments, of animal and vegetal species, of ecological diversity and equilibriums.[29] The ban was upheld by an October 2013 ruling of the Constitutional Council following complaints by US-based company Schuepbach Energy.[30]
In December 2017, to fight against global warming, France adopted a law banning new fossil fuel exploitation projects and closing current ones by 2040 in all of its territories. France thus became the first country to programme the end of all fossil fuel exploitation.[31][32]
And they did well so, as fracking is disastrous for the environment and local communities. In the towns nearby fracking sites, people effectively lost their previous access to clean water, because the aquifiers are poluted with toxic sludge.
Also, they were talking about oil in the article, but I'd point out that natural gas is also available via use of hydraulic fracturing.
https://www.velaw.com/shale-fracking-tracker/resources/france/
According to the European Parliamentary Research Service (“EPRS”), France has the second largest shale reserves in Europe after Poland.1 The EIA estimates that France has 137 trillion-cubic feet (“tcf”) of technically recoverable shale gas resources.2 The country’s most prominent shale reserves are located in several regions including the Paris Basin and the South-East Basin.3 These reserves are unlikely to be developed in the near term, however, because hydraulic fracturing has been banned by the French Government since 2011.4
More recently, France has begun to explore legal means through which it could ban the importation of shale gas from the United States. Critics of the potential ban have called it “unworkable,” as convention and unconventional gases are typically mixed to together during transportation.