Europe: America's Crystal Ball?

A new book warns that the United States is adopting a European economic culture.


Becoming Europe: Economic Decline, Culture, and How America Can Avoid a European Future, by Samuel Gregg, Encounter Books, 384 pages, $25.99

Since the financial crisis of 2008, a cross-Atlantic historical irony has been playing out. In the United States, the federal government's response to the possibility of financial Armageddon was a massive bailout signed into law by a self-described conservative, who said at the time that he had "abandoned free-market principles to save the free-market system." In Europe, meanwhile, many governments have been at least ostensibly engaged in austerity.

In America, Bush's successor continued the heavy intervention in the economy. The responses to this included the rise of the Tea Party movement, a surge of activism driven in part by the worry that the U.S. was becoming increasingly "Europeanized." In Europe, it was the specter of austerity that sparked protests across the continent. Almost all of the small cuts to government budgets that have been proposed in Europe have been met with strong opposition. And it's not just the removal of services for the poor that sets off this angry response: It is the norm in Europe for well-off people to take to the streets to protest cuts to luxuries that they perceive as "benefits" as well.

In Becoming Europe, Samuel Gregg, director of research at the Acton Institute, addresses how Europe adopted its current economic culture. He also joins the Tea Partiers in arguing that the U.S. is adopting similar norms and institutions, thereby losing what Tocqueville called Americans' "spirit of enterprise."

It is frustrating to many Europeans that Americans refer to "Europeanization" or a "European culture." Europe, after all, is a continent of many countries and hundreds of languages; any attempt to generalize its people or culture will inevitably fall short. Thankfully, Gregg doesn't fall into this trap. While acknowledging those differences, he also explains what enables commentators to discuss a common European culture, from the presence of an established lingua franca (be it Latin, French, or English) to the centuries of trade between its different peoples to the ongoing influence of Christianity. And it surely makes sense to speak of a "European economic culture" given the existence of the European Union, whose bloated bureaucracies regulate 27 of the continent's states.

How does an increase in economic interventions set off a protest movement in the United States, while the reverse unleashes protesters in Europe? Part of the answer, Gregg notes, is the very different historical contexts that produced the modern American and European welfare states. In the late 1940s, continental Europe was coming out of a devastating war, with another war and a depression in recent memory. Many of the continent's welfare programs began growing substantially in this period, part of a general effort to assist the less fortunate after a long period of hard times. The results, as Gregg points out, have not been good for Europe's economy, social stability, or—most importantly—the purported beneficiaries of the plans. Yet many Europeans still maintain a strong attachment to those institutions.

The U.S., by contrast, did not create its welfare programs in the aftermath of domestic destruction. And here, unlike in Europe, there has always been a more robust debate about the proper role of the state. The arguments over Obamacare illustrated the almost instinctual mistrust of government that many Americans have, even if they often have other ideas that come into conflict with that distrust. It is hard to imagine that a further centralizing of governmental economic power in Europe would produce protests as large as the ones seen in response to Obamacare. Self-described conservatives in Britain dare not speak against the National Health Service, for example, despite its inefficiencies and poor performance. American welfare programs have yet to become as culturally instilled as they are in many parts of Europe. While Republicans have been known to object to cuts to some entitlement programs, it is not uncommon to be a member of the GOP while calling for a overhaul of the welfare system, something that few career-minded British Conservatives could do.

While Americans should be reassured that their political and economic culture is broadly pro-enterprise and pro-market, Gregg's book is a healthy reminder that the United States has indeed been moving toward a more European economic culture. At the same time, Gregg makes sure to point out that the U.S. is not there yet. It remains to be seen how much Americans will push for free markets, transparency, and property rights in the years ahead. But thanks to Gregg's book, they cannot claim to have not been warned.