In Brief... World News Review: The EU: Still an Economic Dwarf?

In late March Süddeutsche Zeitung reported from Munich, Germany, that although EU expansion is imminent, "the EU appears above all despondent. This stands in sharp contrast to the self-confidence with which the EU proclaimed at the beginning of the millennium its intention of overtaking the U.S. as strongest in the economic area. The giant EU construction must become strong, politically, but above all economically."

The fact is that economic growth in the European Union as a whole is averaging 0.6 percent compared with 3.6 percent in the United States. These figures were published by The Wall Street Journal Europe (March 25). The Financial Times adds, "On issues from innovation to employment, the transatlantic gap has either remained or widened" (March 25). Plainly the EU has fallen well short of the target of matching American economic strides any time in the near future. Most media observers, whether liberal or conservative, judge Europe to be an economic dwarf compared to America—and that was the exact phrase The Wall Street Journal used.

Others sources are more positive in their outlook—especially about the future of the EU. British current affairs author Robert Harvey writes: "The European Union as a whole has an economy comparable to that of the United States, and is steadily progressing towards greater integration. But in terms of growth, cutting-edge technology and most key economic indicators, it continues to lag behind, although this state of affairs may not continue indefinitely" (Global Disorder, 2003, pp. 16-17).

Also take note of Bryn Mawr College professor emeritus Richard Du Boff's assessment: "The United States faces a formidable rival—the EU, its equal in production and trade. The EU is also an emerging political entity, anchored by France and Germany and bent on greater competition with the United States despite the mismatch in military power" (Monthly Review, December 2003).

Yet while Britain has generally kept pace with America, simultaneously Germany has fallen into the economic doldrums. There "more than 41,000 small to medium-sized companies went bust last year, an average of 110 per day." Also "great metropolises like Berlin are quite literally, bankrupt to the tune of billions" (The Scotsman, April 3).

One always worries about German angst when things are going badly economically. We have not yet returned to the historic days of the Weimar Republic. Nonetheless, we should remember that mass unemployment combined with runaway inflation helped produce Adolf Hitler.

Scenes of uncollected rubbish and long bus lines, normally associated with the Britain of the '70s, are beginning to appear in certain German cities. We should all keep an eye on the German economy—keeping in mind the alternative possibility that an unprecedented German economic reversal could happen as well.