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Wednesday, March 28, 2007

Joseph Stiglitz: Europe Points the Way to a Better World

Joseph Stiglitz says the European model provides the foundation for building a better world:

Europe's success points the way to better world, by Joseph E. Stiglitz, Project Syndicate: In some quarters, pessimism dominated the recent celebrations marking the European Union's 50th birthday. Unease about the EU's future is ... understandable, especially given the uncertainty surrounding efforts to revive the Constitutional Treaty.

But the European project has been an enormous success... Europeans should not be dismayed by comparisons of GDP growth in Europe and, say, the United States. Of course, Europe faces great challenges in perfecting its economic union, including the need to reduce unemployment and boost the economy's dynamism.

But, while GDP per capita has been rising in the US, most Americans are worse off today than they were five years ago. An economy that, year after year, leaves most of its citizens worse off is not a success.

More important, the EU's success should not be measured only by particular pieces of legislation and regulation, or even in the prosperity that economic integration has brought. After all, the driving motivation of the EU's founders was long-lasting peace.

Economic integration, it was hoped, would lead to greater understanding... Increased interdependence would make conflict unthinkable. The EU has realized that dream. Nowhere in the world do neighbors live together more peacefully, and people move more freely and with greater security, than in Europe, owing in part to a new European identity... This stands as an example that the world should emulate...

A multi-polar world

Here, too, Europe has led the way, providing more assistance to developing countries than anyone else (and at a markedly higher fraction of its GDP than the US).

The world has faced a difficult period during the past six years. The commitment to democratic multilateralism has been challenged, and rights guaranteed under international conventions, such as the Convention Against Torture, have been abrogated.

Many lessons have emerged, including the dangers of hubris and the limits of military power, and the need for a multi-polar world. Europe, with more people than any nation except China and India, and the largest GDP in the world, must become one of the central pillars of such a world by projecting ... "soft power" - the power and influence of ideas and example.

Indeed, Europe's success is due in part to its promotion of a set of values that, while quintessentially European, are at the same time global. The most fundamental of these values is democracy... The second value is social justice. An economic and political system is to be judged by the extent to which individuals are able to flourish and realize their potential. ...

Europe has succeeded in part because it recognizes that the rights of individuals are inalienable and universal, and because it created institutions to protect those rights. America, by contrast, has witnessed a massive assault on those rights, including that of habeas corpus - the right to challenge one's detention before an independent judge.

Fine distinctions are made, for example, between the rights of citizens and non-citizens. Today, only Europe can speak with credibility on the subject of universal human rights. For the sake of all of us, Europe must continue to speak out - even more forcibly than it has in the past.

Likewise, ... with our environment - the scarcest of all of our resources. In this area, too, Europe has taken the lead, especially concerning global warming...

While economic integration helped achieve a broader set of goals in Europe, elsewhere, economic globalization has contributed to widening the divide between rich and poor within countries and between rich and poor countries.

Another world is possible. But it is up to Europe to take the lead in achieving it.

    Posted by on Wednesday, March 28, 2007 at 02:53 PM in Economics | Permalink  TrackBack (0)  Comments (62)


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