Long Live the European Social Model

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In a commentary for the Wall Street Journal, Jack Lang, the former French education, research and culture minister and one of the best-known socialist politicians in his country, argues it was not a good idea in the first place to make social Europe the theme of the Hampton Court summit, because this model was not what was in question.

Taking on Gordon Brown, the UK Chancellor of the Exchequer, and his preparatory note for the 27 October 2005 Hampton Court Council, « Global Europe: full-employment Europe« , Mr. Lang concedes that « one must acknowledge Mr. Brown’s analysis of globalisation ». He agrees with the head of the British treasury « globalisation isn’t a race toward the bottom, but the top », and that European leaders obsession about Chinese t-shirts is naive when « the U.N. Conference on Trade and Development said that China would become a leading world research centre by 2009 », and when only a small proportion of consumer goods sold here are made in low-wage countries.

But, even by lowering social standards, Mr. Lang argues, Europe will « for a long time to come » not be competitive with China and India in producing simple industrial goods. « We shouldn’t even try. » Europe’s assets, he says, are in its knowledge-based economy. « But to get there we need the means: education, research and innovation. »  And this is, according to Mr. Lang, where the real problem is: « European leaders are perpetrators of a crime against the future » by neglecting to spend more on higher education and research. He cites data according to which EU countries are spending less than half of the proportion of their GDP on higher education that the US and Japan are spending, and less than two thirds of the proportion those countries are spending on research. 

« Under these conditions », Mr. Lang concludes, « it’s no surprise that euro-zone growth fell from 2.25% a decade ago to 1.5% today. » While Europe is doing economically relatively well until now, he says, these figures point to a more gloomy future. 

He then addresses Gordon Brown and the UK Prime Minister, Tony Blair, directly, asking how much sense it made to dedicate the Hampton Court Council to the European social model, when  « the model of a European society based on the values of justice, of emancipation of human beings, on the sanctity of human rights, cannot be placed in doubt » and must not be changed. he goes on to say that « Europe must not change its values, but it must change its way of doing things in order to safeguard these values ». 

He praises the reform of the stability pact as « a step in the right direction », but says it is insufficient: « The ECB and the euro-zone states must start talks on creating an economic government for Europe. » One way of way of giving the ECB more credibility, Mr. Lang says, would be « the introduction of symmetrical inflation targets », like the ones that the Bank of England is using. « It would force the ECB to raise its rates when inflation is high, and to lower them when the inflation forecasts are low. »

Jack Lang finishes with an ardent appeal for upholding European values: « So, as we debate the EU’s economic future, let us not lose track of these larger goals. Let us neither carelessly destroy a model that our nations have taken decades to build, nor make the mistake of denying the values that our peoples have been cultivating for centuries. Far from being a weakness, these values are our greatest strength in the near future. In economic terms, one might say they are our competitive advantage. The heart of the challenge is to invent the tools that will enable the transposition of values created in the Age of Enlightenment into the globalised world. »

Read Jack Lang’s commentary in full on the website of the Wall Street Journal  (requires registration)

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