Many people look at Europe and refuse to believe it can function efficiently in a globalised information economy. Europeans are listening to a degree.
In Germany, Social Democratic Chancellor Gerhard Schroder is increasingly pursuing the siren song of capitalism. In response, he brought his country the “Third Way” a distinctly European way of looking at capitalism, one that combines market capitalism softened by governmental intervention.
In spite of these sweeping changes, Germany still has a long way to go. Hampered by slow growth and high unemployment, Germany’s economy may end up paying dearly for hanging onto economic policies (such as bank-based financing, rather than stock issues) that made them rich 10 years ago; or alternatively, they may reap windfalls from policies (like America’s in favour of capital mobility) that seemed worthless in the past.
As the German brand of capitalism converges with the American shareholder variety, what we should note is that the Germans and other Europeans are seeking to learn not so much capitalist doctrine as capitalist flexibility.
Source: Christopher Caldwell, Europe’s Social Market, Policy Review, October-November 2001, Hoover Institution.
For text http://www.policyreview.org/OCT01/caldwell.html
For more on Germany http://www.ncpa.org/iss/int
FMF Policy Bulletin\21 May 2002
