We are rapidly narrowing the gap with Europe. This represents policy nirvana for the Democrats. They adore the sclerotic, slow-growing, cradle to grave security of the European Union. But do most Americans really want to go there? We will emerge from this downturn. But if the Democrats succeed in using it as an excuse to impose a huge new welfare state, we will not emerge as the same country.
Per capita economic output has been much higher in the United States than in the European Union. Our growth rates have been consistently higher since the Second World War. Until this recession began, America's unemployment rate was half of Europe's, and our unemployed spent less time jobless than did Europe's. European industry has certainly contributed to world prosperity, but cannot match the United States for innovation, dynamism, freedom, or wealth creation. And the Europeans are failing the most basic test of vitality -- they are demographically disappearing. That's one reason why the term "once-great" applies to places like Great Britain and France.
Yes, there's a recession on and it's deep. Capitalism is not perfect (though one harbors the suspicion that if government had not, in effect, subsidized risky mortgage lending, we would not be in this position). But with all its defects, capitalism remains the greatest engine of prosperity the world has ever witnessed. Just in the last 25 years, hundreds of millions of people, principally residing in China and India, who had been close to destitution and starvation are driving cars, sipping lattes, and chatting on cell phones thanks to free market reforms. Countries with few natural resources other than the brains of their people -- like Singapore, Hong Kong, Taiwan, and Japan -- have become economic powerhouses by permitting the free market to work its magic.
Here at home, the U.S. has been able to dramatically improve standards of living not just for the wealthy (they do fine in every country) but for ordinary people. Hard work has been rewarded not punished. And the free market has given us everything from computers and iPods to Prilosec and the Mayo Clinic.
It didn't seem possible six months ago that capitalism in the United States could be in danger. If Obama/Pelosi/Reid have their way, the U.S., too, will bear the prefix "once-great."