I
t is the prevailing idea in both Brussels and Washington: America is soaring, while Europe is falling behind. This refrain even appears in the White House's now-famous National Security Strategy. "Continental Europe has been losing share of global GDP – down from 25% in 1990 to 14% today – partly owing to national and transnational regulations that undermine creativity and industriousness."
European conservative parties have echoed this argument in order to call for deregulation and lower taxes: an end to the Green Deal, challenges to a corporate due diligence rule and scrapping the minimum tax rate on multinational companies. The US envoy to the European Union spoke with the same tone last week, claiming that even the poorest US states, such as Mississippi or West Virginia, now enjoyed a higher standard of living than Germany.
Yet all of this has rather little basis in fact. The idea of a sclerotic Europe facing a supposed American El Dorado, which serves as the foundation for the deregulatory offensive that currently prevails in Brussels, rests on three myths.
The first is that of skyrocketing US growth. At first glance, the statistics seem to support this hypothesis: The US gross domestic product – that is, the value produced on American soil – appears to have increased faster than that of the EU over the past 15 years. In reality, this is mainly because the US population has grown more rapidly. More importantly, however, this growth has been wiped out by the soaring cost of living in the United States, which has been a key phenomenon in contemporary American economic and political life. During his 2024 campaign, Donald Trump managed to exploit the anger this surge had provoked. Now, having failed to bring prices down as he had promised, that anger has turned against him, sending his popularity plummeting.
