John Stossel
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The Death of Europe
Excerpts from John Stossel’s interview with Swedish economist Sven Larson:
European countries, they say, have more laws protecting workers, and so "Europe is better."
That's nonsense, says economist Sven Larson in my new video. He grew up in Sweden, but now says, "If you're a worker, you don't want to live in Sweden!"
One reason is that unemployment is 10%.
"If you get fired," says Larson, "There's no job out there for you."
Years ago, America's economy grew neck and neck with the European Union's. Then, about 15 years ago, Europe stopped growing.
Today, the USA is 50% richer -- even though the European Union has 100 million more people.
Europe is kind of like a big museum. Tourist money keeps it going, but there's so little growth that, per person, America's poorest state (Mississippi) is now richer than most European countries.
The reason is the very same policies ignorant Americans want to copy -- like higher taxes on the rich.
"But what do you do when you run out of the rich?" asks Larson. "Tax the almost rich. Then you run out of them."
But some Americans today are absurdly rich.
Even "if you add up all the value these individuals have," he replies, "it's nowhere near enough to pay the obligations that the federal government has."
So, tax is taken from the average worker.
In Sweden, he says, "Average workers pay (a higher percentage of) taxes than you do if you make $400,000 here in the United States."
But at least their health care is free.
"No!" he replies. "You get the right to free health care, but whether you get health care is a different story. I have friends who died in the Swedish health care system because they couldn't get treatment in time."
Still, Europe offers generous welfare benefits.
"They take care of people!" I tell Larson.
"But it also entraps you," he says. "People get stuck in low-end jobs. They don't start businesses like we do."
One reason they don't start businesses is because Europe's rules meant to "protect" workers make it hard to fire lazy ones.
"You have to go through an extremely bureaucratic sequence," says Larson. "Government will decide whether you are right in saying this person is not doing his job. ... Why would you hire anybody when you are essentially responsible for them for the rest of your life?!"
I wouldn't. It's a big reason why the unemployment rate in Europe is 50% higher than in the U.S.
I often complain about America's excessive regulations. But Europe has many more.
"Here in America," says Larson, "You can put a sticker on a pickup truck that says, 'Bob the carpenter,' and you have a small business. You can start making money. In Europe, you have to wade through fees ... talk to bureaucrats."
That union power, excessive regulation and high taxes are why Europe now has zero of the world's largest companies. The list constantly changes, but as I write, no European company is in the top 20. American firms lead the list.
I ask Larson, "Don't European governments see what this has done to their economies and change these rules?"
"No," he answers. "A lot of politicians thrive on having a population dependent on government because you get a lot of votes from a lot of people who depend on government. America still has this spirit of understanding that you can actually make life better for yourself, which I don't find in Europe."
We do have that spirit ... now.
But it's challenged by the 300,000 bureaucrats who write and enforce regulation. And that's just federal regulators. States and cities employ even more!
That's a lot of people who believe that if they're not adding more rules, they're not doing their job.
Stop them before they make America as stagnant as Europe.
Many years ago I met a young Austrian who had just (legally) emigrated to America. He was just back from touring Saratoga Springs with an eye towards opening a bakery there and was astonished by what he’d found: “I can just open a bakery”, he told me, “no one can veto it!”. In Austria, he explained, would-be bakers like him were required to serve a six-year apprenticeship (which he’d done) with an established bakery and only then were they allowed to go into business on their own. “But you can’t open a bakery in a town unless every baker already already there gives his consent; in most towns, they don’t want the competition, so you don’t get a license.”
America’s certainly trending towards the European model: Illinois requires hair braiders to undergo 300 hours of training before being allowed to work, for instance, but so far, we lag far behind our European betters; here’s hoping we stay that way.
