Europeans are becoming poorer

[VOSS]

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Europeans are facing a new economic reality, one they haven’t experienced in decades. They are becoming poorer. Life on a continent long envied by outsiders for its art de vivre is rapidly losing its shine as Europeans see their purchasing power melt away. 

 

With consumption spending in free fall, Europe tipped into recession at the start of the year, reinforcing a sense of relative economic, political and military decline that kicked in at the start of the century.

 

Europe’s current predicament has been long in the making. An aging population with a preference for free time and job security over earnings ushered in years of lackluster economic and productivity growth. Then came the one-two punch of the Covid-19 pandemic and Russia’s protracted war in Ukraine. By upending global supply chains and sending the prices of energy and food rocketing, the crises aggravated ailments that had been festering for decades. 

 

Governments’ responses only compounded the problem. To preserve jobs, they steered their subsidies primarily to employers, leaving consumers without a cash cushion when the price shock came. Americans, by contrast, benefited from inexpensive energy and government aid directed primarily at citizens to keep them spending.

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Private consumption has declined by about 1% in the 20-nation eurozone since the end of 2019 after adjusting for inflation, according to the Organization for Economic Cooperation and Development, a Paris-based club of mainly wealthy countries. In the U.S., where households enjoy a strong labor market and rising incomes, it has increased by nearly 9%. The European Union now accounts for about 18% of all global consumption spending, compared with 28% for America. Fifteen years ago, the EU and the U.S. each represented about a quarter of that total.

 

The pain reaches far into the middle classes. In Brussels, one of Europe’s richest cities, teachers and nurses stood in line on a recent evening to collect half-price groceries from the back of a truck. The vendor, Happy Hours Market, collects food close to its expiration date from supermarkets and advertises it through an app. Customers can order in the early afternoon and collect their cut-price groceries in the evening. 

 

The eurozone economy grew about 6% over the past 15 years, measured in dollars, compared with 82% for the U.S., according to International Monetary Fund data. That has left the average EU country poorer per head than every U.S. state except Idaho and Mississippi, according to a report this month by the European Centre for International Political Economy, a Brussels-based independent think tank. If the current trend continues, by 2035 the gap between economic output per capita in the U.S. and EU will be as large as that between Japan and Ecuador today, the report said.

 

Weak growth and rising interest rates are straining Europe’s generous welfare states, which provide popular healthcare services and pensions. European governments find the old recipes for fixing the problem are either becoming unaffordable or have stopped working. Three-quarters of a trillion euros in subsidies, tax breaks and other forms of relief have gone to consumers and businesses to offset higher energy costs—something economists say is now itself fueling inflation, defeating the subsidies’ purpose. 

 

Public-spending cuts after the global financial crisis starved Europe’s state-funded healthcare systems, especially the U.K.’s National Health Service.

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Huw Pill, the Bank of England’s chief economist, warned U.K. citizens in April that they need to accept that they are poorer and stop pushing for higher wages. “Yes, we’re all worse off,” he said, saying that seeking to offset rising prices with higher wages would only fuel more inflation.

 

With European governments needing to increase defense spending and given rising borrowing costs, economists expect taxes to increase, adding pressure on consumers. Taxes in Europe are already high relative to those in other wealthy countries, equivalent to around 40-45% of GDP compared with 27% in the U.S. American workers take home almost three-quarters of their paychecks, including income taxes and Social Security taxes, while French and German workers keep just half. 

Full Article

[Cheers]

They’re too focused talking about us Americans

[Bonicap]

But we'll have Eras Tour next year to revitalize the economy.

[Bears01]

10 minutes ago, Cheers said:

They’re too focused talking about us Americans

Yup. Anytime legit issues are pointed out among European countries, I do often hear “but, but, but, BUTTT….America!!!”

[Power love]

21 minutes ago, Cheers said:

They’re too focused talking about us Americans

 

[byzantium]

23 minutes ago, Cheers said:

They’re too focused talking about us Americans

Honestly their economy would be doing great if they devoted half the attention they devote obsessing about Americans on excelling in their industries.  

Edited July 18, 2023 by byzantium

[Dialamba]

The way minimum wage is barely going up but prices are skyrocketing for no reason I hate it here.

31 minutes ago, Cheers said:

They’re too focused talking about us Americans

I’m American system still suck  

[vuelve88]

Shakira’s power 

[Bears01]

1 minute ago, Dialamba said:

The way minimum wage is barely going up but prices are skyrocketing for no reason I hate it here.

I’m American system still suck  

America has a ton of issues (specifically in the healthcare industry and beyond) but the average American still makes more $$ than the vast majority of European countries.

 

Y’all got stuff to fix instead of trying to hide away and virtue signal at us 

[uusagii]

They're worthless wbk

[Alongoria13]

They are still richer than most of the world please

[Dialamba]

1 hour ago, Bears01 said:

America has a ton of issues (specifically in the healthcare industry and beyond) but the average American still makes more $$ than the vast majority of European countries.

 

Y’all got stuff to fix instead of trying to hide away and virtue signal at us 

The cost of living in America is much more than I. Europe please. Thanks y’all got more money than  us.  
Also this charts only mention some the biggest European countries because in countries such as Danemark, Luxembourg and Switzerland the purchasing power is higher and citizens live well there. 

[LadyDiana]

Wait, wait, us economy grew 82 % and eu 8% in the last 15 years? That can't be true??

[Keter]

We been knew y’all was broke! 

[Harrier]

 

oh noo Europe doesnt have as many megarich people spending billions propping up their private consumption numbers, whatever shall they do  maybe they'll go to their metal detectorless primary schools or free hosptials and cry about it

 

if anything this is yet more evidence of what a dystopia the US really is. Far and away the richest country in the history of the world, eclipsing even other rich places like Europe or my country, and yet somehow manages to be **** for most of its citizens

[Tropez]

15 minutes ago, Harrier said:

 

oh noo Europe doesnt have as many megarich people spending billions propping up their private consumption numbers, whatever shall they do  maybe they'll go to their metal detectorless primary schools or free hosptials and cry about it

 

if anything this is yet more evidence of what a dystopia the US really is. Far and away the richest country in the history of the world, eclipsing even other rich places like Europe or my country, and yet somehow manages to be **** for most of its citizens

Meh. I dislike the U.S. as much as the next person. But you have to sit down and face Europes problems and not just focus on the US. What you’re saying makes it seem like the world revolves around the US and this isn’t true. Many European countries have a lot of billionaires. Many young people can’t afford homes because housing is expensive. The population is aging which will cause a collapse of many social safety nets. 
 

There’s many more problems. But let’s focus on Europe not a country an ocean away. 

[Harrier]

24 minutes ago, Tropez said:

Meh. I dislike the U.S. as much as the next person. But you have to sit down and face Europes problems and not just focus on the US. What you’re saying makes it seem like the world revolves around the US and this isn’t true. Many European countries have a lot of billionaires. Many young people can’t afford homes because housing is expensive. The population is aging which will cause a collapse of many social safety nets. 
 

There’s many more problems. But let’s focus on Europe not a country an ocean away. 

Of course Europe has many problems, as does my country (Australia). The point of this thread is not to have a legitimate discussion about those issues, it's for Americans to smugly laugh about how rich they are compared to Europeans based on a fairly meaningless metric. Just look at the posts. I am responding to that, not arguing Europe doesn't have problems

[Orsay]

i’m so bored with the European vs US stuff on here  and i see it on other platforms too

 

its giving narcissism of small differences

[KeirGrey]

Sure it has nothing to do with a literal war on our continent 

[Happylittlepunk]

It’s been well known for a while Europe is in worst condition than US especially economics. Europeans are always broke. US is many things but its system is stronger than Europes. 

[bad guy]

I’m sure the billions they’re throwing at Ukraine will make things better.

[DuffStan]

Not all the Euro hate in here, ew. Money is a human invention, everything will be fine.

[Chemist]

I am sorry but this is nothing to be proud of. Rich Americans are getting richer, we know that while inequality in Europe remains the same

 

it is almost impossible for Europeans to become really wealthy because of the massively high taxes, which in some countries are well distributed and contribute to the lower inequality vs the US

 

 

 

 

[abrantino]

2 hours ago, bad guy said:

I’m sure the billions they’re throwing at Ukraine will make things better.

yeah they definitely should just let Russia do whatever it wants (again), how dumb of Europe

[ScorpiosGroove]

still richer than the rest of y’all