of Minor Differences
How America and Europe Are Alike
by Peter Baldwin
Oxford, 336 pp., $24.95
At last, we have the essential complement to Robert Kagan’s Of Paradise and Power, and its subtitle—“How America and Europe Are Alike”—will surely evoke protest from those on both sides of the Atlantic who have become vested advocates of the differences between the United States and Europe and the manifest superiority of one side over and against the other.
Kagan encapsulated his provocative dual thesis, propounded at short-book length in 2003 as transatlantic relations were blowing up over the Iraq war, in the phrase, “Americans are from Mars and Europeans are from Venus.” Critics have been trying to chip away at him ever since, but he really did pin down something essential about how power shapes attitudes and attitudes shape power in the United States and Europe. His argument remains the lodestone for debate over transatlantic relations and will continue to do so until the underlying configurations of power and ideas about power change.
It is hardly on questions of power alone that the op-ed pages on both sides of the Atlantic bristle with accusations predicated on a sense of self-superiority amidst fundamental difference between Europe and the United States: “Jungle capitalism” vs. a strong social safety net, American moralism vs. European sophistication, religious believers vs. the secular heirs of the Enlightenment.
The contention of Peter Baldwin is that all of the difference-mongering about the United States and Europe is wildly overblown—that, in fact, across a panoply of quantifiable social characteristics and policy outcomes, the United States generally falls not outside the European range, but squarely within it. In 212 charts, 60 pages of footnotes, and a crackling prose style refreshingly at odds with the statistical material under consideration, he proves the case beyond a reasonable doubt.
Europeans are overtaxed by American standards, no? Well, it’s true that total tax revenue per capita (adjusted for purchasing power parity) is higher in France and Sweden than in the United States; but as it happens, it’s lower in Italy, the United Kingdom, and Germany. Still, income taxes are more progressive in Europe, aren’t they? In Germany, Spain, and France, yes; in Denmark, Italy, and the Netherlands, no. Rich Americans get away with paying little, right? In fact, the richest 10 percent of Americans pay 45 percent of total taxes, a higher percentage than any country in Western Europe, and about twice as much as in Switzerland.
What about the massively bureaucratic welfare states of Europe? Actually, public employment is higher in the United States, at just under 7 per 100 workers, than in Germany, Spain, or Italy, though it is lower than in dirigiste France (which is nevertheless below 8 per 100). Total government expenditure as a percentage of GDP in 2004 was lower in the United States than in most of Europe, but not lower than in Ireland or Switzerland. The 2007 unemployment rate in the United States of just over 4.5 percent (those were the days) was indeed lower than in France, Greece, Spain, and Germany at over 8 percent. But the American rate was higher than that of the Netherlands, Denmark, and Austria.
But Europe is greener-than-thou, right? Well, true, the United States recycles much less waste than Germany or the Netherlands, but about the same percentage as France and more than Britain. American greenhouse gas emissions have increased since 1990 whereas Germany’s and Britain’s have gone way down, but the U.S. increase is not much more than that of Italy and lags behind Austria, Ireland, and Spain.
We have all heard tell of the vast concentration of wealth among the richest of the rich in the United States, a tale of rampant and increasing inequality. If you find this scandalous, wait until you hear what’s been going on in the cradle-to-grave welfare state of egalitarian Sweden. To begin with, the raw figures are not dissimilar: The wealthiest 1 percent of Swedes owned 21.9 percent of total wealth in 2000, compared with 20.8 percent for the wealthiest one percent of Americans. But, Baldwin notes, the figures for Sweden appear to be grossly underestimated because of the propensity of rich Swedes to take their fortunes offshore to avoid Swedish tax rates and of countervailing government tax incentives to try to keep privately owned mega-firms at home: