Goldberg: If we Europeanize, who will become the new America?

By Jonah Goldberg

By now you may have heard: America is on its way to becoming another European country.

The recently passed health care legislation is the cornerstone of the Europeanization of America. And to pay for it, the White House is now floating the idea of imposing a value-added tax, or VAT, like they have throughout most of Europe.

In the egghead-o-sphere there's been an ongoing debate about whether America should become more like Europe. The battle lines are split along almost perfect left-right lines ideologically. Liberals like the European welfare states, unionized work forces (in and out of government), generous benefits, long vacations, etc. Conservatives like America's economic growth, its dynamism and innovation.

From what I can tell, everyone agrees you can't have Europeanization without European-size governments. Hence, America's government outlays (pre-Obama) have tended to hover around 20 percent of GDP (the average of the last 50 years), while Europe's are often more than twice that. In France, government outlays are nearly 55 percent of GDP. In 2009, the bailout and Obama budget sent America's government outlay to 28 percent of GDP.

Liberals insist conservatives are wrong to think that Europeanizing America will necessarily come at any significant cost. New York Times columnist and Princeton economist Paul Krugman says that in exchange for only a tiny bit less growth, Europeans buy a whole lot of security and comfort. Economists such as Stanford's Michael Boskin say Europeans have a standard of living about 30 percent lower than ours and are stagnating. Others note that the structural unemployment rate in Europe, particularly for young people (it's more than 20 percent in many countries), is socially devastating.

I think the debate misses something. We can't become Europe unless someone else is willing to become America.

Europe is a free-rider. It can only afford to be Europe because we can afford to be America.

The most obvious and most cited illustration of this fact is national defense. Europe's defense budgets have been minuscule because Europeans can count on Uncle Sam to protect it. Britain, which has the most credible military in NATO after ours, has funded its butter account with its gun account. As Mark Steyn recently noted in National Review, from 1951 to 1997, the share of British government expenditure on defense fell from 24 percent to

7 percent, while the share on health and welfare increased from 22 percent to 53 percent. And that was before New Labor started rolling back Thatcherism.

But that's not the only way in which Europeans are free-riders. America invents a lot of stuff. When was the last time you used a Portuguese electronic device? How often does Europe come out with a breakthrough drug? Not often, and when it does, it's usually because companies like Novartis and GlaxoSmithKline increasingly conduct their research here. Indeed, the top five U.S. hospitals conduct more clinical trials than all the hospitals in any other single country combined.

Europhiles hate this sort of talk. They say there's no reason to expect America to lose its edge just because we have a more “compassionate” government. Americans are an innovative, economically driven people. That's true. But so were the Europeans - once. Then they adopted the policies they have today and that liberals want us to have.

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