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"The 21st Century will belong to the European Union," Financial Times, May 13- Michael Prowse

"An unbeatable bargain in the making: PAUSE FOR THOUGHT:" Michael Prowse argues that the 21st century will belong to that unique and underrated political organisation, the European Union.

To whom will the 21st century belong? A decade ago, pop historians had no doubts. Asia was rising. Europe, the argument went, reached its apogee of influence in the 19th century. The 20th century was indubitably America's.
But the US would have to make way for an Asian culture that married capitalism and Confucianism. Prepare, therefore, for China's global
triumph.
Today, pop historians sing a different tune. They still agree that the 20th century was America's. The difference is that they now see every future century as America's. History has stopped and the US has emerged the winner.
Indeed with globalisation, the game of picking regional winners has lost its point. The end of history means the Americanisation of the globe. CNN, Disney and McDonald's: this is the high plateau towards which the human race has been ascending for the past few million years.
Let me offer a different vision of the future - and past. The 19th century didn't belong to Europe: it was Britain's century. It was the century of liberal individualism. I agree that the 20th century was America's. The US outperformed everyone else economically, technologically and militarily. And it can rightly claim the credit for defeating fascism and communism.
Yet, despite its historical triumphs, I do not see it as offering a social model that will ultimately prove acceptable. Asian brands of capitalism are even less attractive.
I see the 21st century as belonging to Europe - to that unique and much underrated political organisation called the European Union.
Absurd, you will say. Even the Continentals now agree that their sclerotic social model has failed. After two decades of near double-digit unemployment, European leaders look to Bill Clinton and Tony Blair for leadership. They want to deregulate and liberalise. They want to become more individualistic. They accept globalisation. They love the internet, that ultimate ideological weapon of American libertarians. The end of history story is fundamentally correct.
Wrong. This century has only just begun. In 1900, few Englishmen understood how powerful the US would become. Today, few Americans grasp that a political entity of greater potential power than the US is now taking shape. This failure isn't surprising: it is always difficult to envisage an infant as an adult. And it shows itself in many quirky ways.
For instance, US newspapers are still reluctant to assign reporters to Brussels. They think policy must still be made in national capitals. Psychologically, many Americans still think of Europe in second world war terms, as a continent of squabbling nations.
They never believed that the Germans would sacrifice their beloved the D-mark in the cause of European unity. They never believed the euro would fly. Today they disparage it, failing to grasp that its depreciation against the dollar is a positive omen for Europe.
In the past 30 years the US enjoyed a competitive edge from a dollar that was usually too weak. Now the EU, against the wishes of some of its bone-headed bankers, is seizing for itself a competitive advantage that the US was long able to monopolise.
It can do this because the melding of separate currencies into the euro has greatly reduced the inflationary risks from currency depreciation. There are now two, rather than one, continental economies that can use the exchange rate aggressively as an export promotion tool.
I am not denying flaws in the European social model. The labour markets of some EU countries are still unnecessarily rigid. In many countries, public sector pensions are too generous and will need to be scaled back. But it is a logical fallacy to argue that because some forms of state intervention and regulation have proved inappropriate, the solution lies in no intervention and no regulation.
The solution actually lies in more intelligent intervention and regulation. After all, some European countries that are anything but laissez faire do manage to keep unemployment low: Switzerland is a case in point.
We should reject the false choice of either a low jobless rate or a civilised workplace in which employees enjoy security and dignity. Both goals can be achieved - provided Europeans set their sights high enough.
What the criticism of the European social model ignores is the fact that the US social model (if it has anything that deserves the title) is even more seriously flawed. We are in the closing stages of one of the strongest business cycle upturns in history. We are seeing irrational stock market exuberance on a scale never previously witnessed - not even in 1929. In these Belle Epoque times, it is only too easy to overestimate the advantages of American-style capitalism.
But once the next recession hits - and another recession is a certainty - the enthusiasm for everything American will diminish. And the advantages of continental Europe will become more evident: safe, beautiful cities; high-quality public services - including healthcare - that are available to all; a social safety net without holes; a commitment to redistribution; and a balanced attitude towards work and leisure.
The 21st century will belong to Europe because it will offer the world the most satisfying overall combination of individual liberty, economic opportunity and social inclusion. It will offer the individual more personal freedom than intolerant Asia. And the value of this freedom will be enhanced by a sense of community and a commitment to social welfare that is largely missing in atomistic America. That will make Europe an unbeatable bargain.