Beyond the current cartoon madness, Europe may have a larger problem—irrelevance. That’s the issue addressed by commentator Fareed Zakaria in Newsweek: “The Decline and Fall of Europe.” The trigger for this gloomy assessment is a just-released report, “Going for Growth,” by the OECD/Organization for Economic Co-operation and Development, a rather sane and sober group with, typically in my opinion, a pro-Europe bias. Typical observations: “Talk to top-level scientists and educators about the future of scientific research, and they will rarely even mention Europe. In the biomedical sciences, for example, Europe is not on the map, and it might well be surpassed by much poorer Asian countries. The CEO of a large pharmaceutical company told me that in ten years, the three most important countries for his industry would be the United States, China, and India.” The demographic story is, of course, a disaster. In 25 years, Zakaria points out, the number of working-age Europeans will decline in absolute numbers by seven percent, while the over-65s will “grow” by an unimaginable 50 percent—yet the citizenry continues to steadfastly rebuff labor-market reforms.
All in all, not a pretty picture. As Zakaria puts it, in summary, “These days we all talk about the rise of Asia and the challenge to America, but it might well turn out that the most consequential trend of the next decade will be the economic decline of Europe.”