Can Europe continue to sustain one of the world's most ambitious social models while falling increasingly behind its major economic competitors? For Pascal Lamy, former European Commissioner for Trade and former Director-General of the World Trade Organization, this question lies at the heart of the continent's mounting economic and political tensions. Lamy looks beyond the immediate turmoil in France to identify a deeper European predicament: a widening disconnect between the continent's social commitments and its capacity to generate the economic growth needed to sustain them.
"The common cause of these turbulences is the mismatch between a very sophisticated European social system, which is the best on Earth, and Europe's weak growth," he argues. His diagnosis is particularly stark: Europe's potential growth rate, he maintains, is only half that of the United States, one-third that of China and one-fourth that of India.
