But it will take more than economic reforms to undo, if still possible, Europe’s “Civilizational erasure” pointedly stated in the US National Security Document.
This reads to me less like a welfare problem and more like a coordination problem across time.
Europe’s institutions optimize for deliberation, legitimacy, and procedural control while power, production, and security now operate on much faster execution cycles.
When institutional time lags reality, even good intentions look like stagnation.
Thank you. It's a very valid interpretation, there is truth to it -- though I would argue that welfare problem is still an important part/manifestation of it, simply based on how many resources it absorbs.
However, i would question what we mean by "optimize" in this context. A society's institutions are always trying to balance multiple goals. I read your argument as implying that Europe is currently getting the balance wrong -- because it gets very little innovation and growth. An alternative interpretation I guess would be that Europe's preferences are close to lexicographic, meaning that it prioritizes deliberation and procedures above all else.
I think that Europe's problem started already 20-30 years ago, but you are certainly right that in a moving world, the same shortcomings become more costly.
This is helpful, thank you. I agree welfare is a real manifestation, not a distraction, my intent was to separate where the pressure shows up from what generates it.
On “optimize”: I don’t mean a single objective or a mistake in intent. Your lexicographic framing is persuasive. My concern is slightly orthogonal, whether institutions can sustain that preference when execution cycles elsewhere compress faster than deliberation can scale.
In that sense the issue isn’t that Europe values procedure too much, but that time has become an external constraint. Even coherent value tradeoffs start to look like stagnation once action, production, and security operate on incompatible clocks.
I think you’re right that this began decades ago; the difference now is that the cost of lag compounds rather than accumulates.
It's an important point. If you are correct - and I think you are - European leaders should worry, or at least take into account, that in terms of power, production and security they risk falling behind at an accelerating pace. I don't think they realize it.
“The larger issues facing Europe include activities of the European Union and other transnational bodies that undermine political liberty and sovereignty, migration policies that are transforming the continent and creating strife, censorship of free speech and suppression of political opposition, cratering birthrates, and loss of national identities and self-confidence.”—”National Security Strategy of the U.S.”, White House, November 2025
Widening per-capita income gap between US and every Western European country. Europe is becoming irrelevant in the world economy and politics: a collection of inconsequential principalities.
”It would be better to try to find a Modus Vivendi…”
Tell me you haven’t studied European history without saying so. Eastern Europe has tried to find a modus vivendi with Russia ever since the Golden Hords. For the last 800 years it has not been successful. Russia’s strategy has always been to expand geographically until it reached a natural border such as a mountain range or an ocean. That’s why the Soviet Union had to incorporate the eastern block, reaching to the Baltic Sea (Finland ”should ” have been part of Russia but they were too good fighters to easily incorporate).
Russia has for the last millennium consistently broken every agreement.
Germany? Which Germany? The nation state that was created in 1871? Or Prussia? Or the Holy Roman Empire or….
Problem is Russia has been a nation state for a millennia and expansionist but Germany, not so much.
By the way, I agree with your analysis of the problems facing the EU, and especially Germany.
I do believe that the common awareness of history in the EU will make it politically possible to continue to economically support the Ukraine, because from a Polish, German, Estonian, Finnish….perspective it’s a…..incredible bargain!
Russian Agitprop is less success in a country where you own grandmother was killed in the war, and the history books are full of dates for wars with Russia.
Peter, we can agree to disagree on whether peaceful coexistence with Russia is a realistic prospect. And if you and I were running the EU, I might be happy to go with your argument. I have worked extensively in Eastern Europe and have many friends in and from the region, so I take their concerns very seriously. But I would then insist that if the choice is to contain Russia with a credible military bulwark, or even more to help Ukraine defeat Russia, then we have to build the economic and military might that are needed for such a strategy to be plausible.
I suggest we all learn from it and I just quote here a fragment: ‘Over the last twenty years, we have gone from being a continent that embraced new technologies, narrowing the gap with the United States, to one that has progressively erected barriers to innovation and its adoption. We saw this in the first phase of the digital revolution, when European productivity growth dropped to about half the US pace and almost all the divergence emerged from the technology sector. Now this pattern is repeated with the artificial intelligence revolution. Last year, the United States produced 40 major fundamental models, China 15, the European Union only 3; the same pattern can be observed in many other frontier technologies, from biotechnology to advanced materials to nuclear fusion, where many significant innovations and private investments take place outside Europe.’
I am all for criticism and I know it’s your style (even if we are left with only your comments to other’ contributions to try to understand what you are thinking) but I am not for typical social media bashing, especially when equipped with poor information.
Hi Fabio (I assumed it’s you although you changed your username here - if not then apologies). You should spend more time in Italy where, instead of America ‘out of pocket’ healthcare you wait 9 months for your cancer screening and then it’s too late. Not saying that healthcare is not a ripoff in the US but social welfare in Europe is totally bankrupt and flawed by stupid rules. A personal example: I had lived in Berlin before moving back to Italy and there the company I worked for was paying a private health insurance for me. When I left the company after ten years I tried to enroll for the public health coverage but I was forbidden to do so because I was on the private system before. I paid to the public healthcare system in excess of 150,000 social contributions. I got excluded from health coverage. Ripoff? And the state of roads? Infrastructure? Grid? Education? So please don’t say that the ‘household burden is comparable’ it’s simply wrong. And before saying that the current states of the European and U.S. economies are comparable I would detach myself from data by the “OECD, Eurostat, Census, Fed” and would dive into real life situations. But then again it must be me… because your team and your investors - to which I bow - ‘figured it out’
Agree with you.
But it will take more than economic reforms to undo, if still possible, Europe’s “Civilizational erasure” pointedly stated in the US National Security Document.
This reads to me less like a welfare problem and more like a coordination problem across time.
Europe’s institutions optimize for deliberation, legitimacy, and procedural control while power, production, and security now operate on much faster execution cycles.
When institutional time lags reality, even good intentions look like stagnation.
Thank you. It's a very valid interpretation, there is truth to it -- though I would argue that welfare problem is still an important part/manifestation of it, simply based on how many resources it absorbs.
However, i would question what we mean by "optimize" in this context. A society's institutions are always trying to balance multiple goals. I read your argument as implying that Europe is currently getting the balance wrong -- because it gets very little innovation and growth. An alternative interpretation I guess would be that Europe's preferences are close to lexicographic, meaning that it prioritizes deliberation and procedures above all else.
I think that Europe's problem started already 20-30 years ago, but you are certainly right that in a moving world, the same shortcomings become more costly.
This is helpful, thank you. I agree welfare is a real manifestation, not a distraction, my intent was to separate where the pressure shows up from what generates it.
On “optimize”: I don’t mean a single objective or a mistake in intent. Your lexicographic framing is persuasive. My concern is slightly orthogonal, whether institutions can sustain that preference when execution cycles elsewhere compress faster than deliberation can scale.
In that sense the issue isn’t that Europe values procedure too much, but that time has become an external constraint. Even coherent value tradeoffs start to look like stagnation once action, production, and security operate on incompatible clocks.
I think you’re right that this began decades ago; the difference now is that the cost of lag compounds rather than accumulates.
It's an important point. If you are correct - and I think you are - European leaders should worry, or at least take into account, that in terms of power, production and security they risk falling behind at an accelerating pace. I don't think they realize it.
“The larger issues facing Europe include activities of the European Union and other transnational bodies that undermine political liberty and sovereignty, migration policies that are transforming the continent and creating strife, censorship of free speech and suppression of political opposition, cratering birthrates, and loss of national identities and self-confidence.”—”National Security Strategy of the U.S.”, White House, November 2025
Widening per-capita income gap between US and every Western European country. Europe is becoming irrelevant in the world economy and politics: a collection of inconsequential principalities.
US has higher per capita income than every EU member.
The median won’t move by one penny.
”It would be better to try to find a Modus Vivendi…”
Tell me you haven’t studied European history without saying so. Eastern Europe has tried to find a modus vivendi with Russia ever since the Golden Hords. For the last 800 years it has not been successful. Russia’s strategy has always been to expand geographically until it reached a natural border such as a mountain range or an ocean. That’s why the Soviet Union had to incorporate the eastern block, reaching to the Baltic Sea (Finland ”should ” have been part of Russia but they were too good fighters to easily incorporate).
Russia has for the last millennium consistently broken every agreement.
Fair. Of course, any keen student of European history such as yourself would have made much the same point about Germany not so long ago.
Germany? Which Germany? The nation state that was created in 1871? Or Prussia? Or the Holy Roman Empire or….
Problem is Russia has been a nation state for a millennia and expansionist but Germany, not so much.
By the way, I agree with your analysis of the problems facing the EU, and especially Germany.
I do believe that the common awareness of history in the EU will make it politically possible to continue to economically support the Ukraine, because from a Polish, German, Estonian, Finnish….perspective it’s a…..incredible bargain!
Russian Agitprop is less success in a country where you own grandmother was killed in the war, and the history books are full of dates for wars with Russia.
Peter, we can agree to disagree on whether peaceful coexistence with Russia is a realistic prospect. And if you and I were running the EU, I might be happy to go with your argument. I have worked extensively in Eastern Europe and have many friends in and from the region, so I take their concerns very seriously. But I would then insist that if the choice is to contain Russia with a credible military bulwark, or even more to help Ukraine defeat Russia, then we have to build the economic and military might that are needed for such a strategy to be plausible.
The White House National Security Strategy describes US focus moving away from babysitting Europe to strategically more important parts of the world.
It’s funny how you focus on macro figures, even more so since you said live in the US… perhaps you are blind to what corporate America And state/corporate China have been doing in the last twenty years. I suggest you check it out. If you are too busy to spend your time on that, you can refer to Mario Draghi’s speech last week: https://en.ilsole24ore.com/art/mario-draghi-europe-risks-stagnation-if-it-does-not-focus-on-artificial-intelligence-AIeHGg?refresh_ce=1
I suggest we all learn from it and I just quote here a fragment: ‘Over the last twenty years, we have gone from being a continent that embraced new technologies, narrowing the gap with the United States, to one that has progressively erected barriers to innovation and its adoption. We saw this in the first phase of the digital revolution, when European productivity growth dropped to about half the US pace and almost all the divergence emerged from the technology sector. Now this pattern is repeated with the artificial intelligence revolution. Last year, the United States produced 40 major fundamental models, China 15, the European Union only 3; the same pattern can be observed in many other frontier technologies, from biotechnology to advanced materials to nuclear fusion, where many significant innovations and private investments take place outside Europe.’
I am all for criticism and I know it’s your style (even if we are left with only your comments to other’ contributions to try to understand what you are thinking) but I am not for typical social media bashing, especially when equipped with poor information.
Hi Fabio (I assumed it’s you although you changed your username here - if not then apologies). You should spend more time in Italy where, instead of America ‘out of pocket’ healthcare you wait 9 months for your cancer screening and then it’s too late. Not saying that healthcare is not a ripoff in the US but social welfare in Europe is totally bankrupt and flawed by stupid rules. A personal example: I had lived in Berlin before moving back to Italy and there the company I worked for was paying a private health insurance for me. When I left the company after ten years I tried to enroll for the public health coverage but I was forbidden to do so because I was on the private system before. I paid to the public healthcare system in excess of 150,000 social contributions. I got excluded from health coverage. Ripoff? And the state of roads? Infrastructure? Grid? Education? So please don’t say that the ‘household burden is comparable’ it’s simply wrong. And before saying that the current states of the European and U.S. economies are comparable I would detach myself from data by the “OECD, Eurostat, Census, Fed” and would dive into real life situations. But then again it must be me… because your team and your investors - to which I bow - ‘figured it out’
My note on ‘comments’ meant that you don’t write posts so o only know you by your comments. Nothing more