“Europe’s Economic Apocalypse is Now”
— Peter St Onge, Ph.D. (@profstonge) December 24, 2024
Europe is imploding because their governments are taking over the entire economy.
Trump could be the tipping point. pic.twitter.com/9v46zXZaJ0
"Europe's economic apocalypse is now," so says Politico in a panicked Jeremiad that European socialism is failing and the European Union just like it did in the Soviet Union. The article blames Donald Trump's tariff threats, which are indeed panicking Europe Incorporated and the bureaucrats who feed off them like ticks. But Europe's implosion is self-induced and long predates Trump's victory. In short, what's killing Europe is what is killing the American economy but double time. So, over-taxing over-regulating, green unicorn farts, and a government that has cannibalized the private sector, draining it of talent, opportunity, and innovation. So consider that Europe has not one major company in any technology invented in the past 40 years. Has no internet company, no AI company. Europe doesn't have a single entry among the top 15 best-selling electric vehicles despite eye-watering green subsidies. In fact, it's hard to think of anything Europe hasn't invented since, oh, 1910. The problem is Europe's slow death turned into a fast death during COVID-19, which sent government spending in the EU 52% of GDP, a fatal tipping point. I've mentioned in previous videos how it isn't necessarily the money the government spends, it's what they do with that money. So the regulators paid to prey upon small businesses, the central planners who soak big business and subsidies so upstarts cannot compete. The tax-funded activists who throw soup on Picassos and then shut down power plants. In Europe's case, all that money bought all of it. So we can take Germany, formerly the engine room of the European economy has been in recession for 2 years, layoffs are soaring, bankruptcies are rising double digits, and the main employment index just hit its COVID lows. In U.S. terms, Germany is losing a million jobs per year. The crown jewel of the German economy, automakers, are currently mass announcing layoffs that come to 1 in 10 workers in the entire industry. It is imploding before our eyes. That Germany's flailing companies are up against regulation that makes producing in Germany uncompetitive. They're up against labor costs, which are driven by labor regulations, and energy costs which are driven by Germany's out-of-control Greens, who shuttered coal, shuttered nuclear, and are now trying to run the country by grinding up trees, so-called biomass, while begging for top-dollar energy from its neighbors. To give a flavor, Germany recently jacked energy prices tenfold because it was cloudy and the wind was not blowing. Try running a steel mill on that. Even in normal times, industrial energy costs over twice what it does in US states like Pennsylvania or Ohio, who can still use coal.
As Politico puts it, if Europe remains on its current trajectory, its future will be a decaying open-air museum for American and Chinese tourists. What Europe needs is to radically shrink its governments, national, regional, and the federal oligarchy in Brussels. At the moment, they are miles from that, instead focused on yet more stimulus packages for big business and of course locking out populists. Still, change is coming because Europe's hospice economy is about to get a major shot from Donald Trump. So Trump lowering taxes and regulations or imposing tariffs would open a floodgate of European companies fleeing their sinking ship for safer shores in America. That would leave millions of layoffs behind that could turn Europe into a political tinder box.
