`Asia is the future." "Everyone is investing in the Pacific Rim." "The 21st century belongs to China." The only thing wrong with these statements is that the lion's share of U.S. investment dollars goes to Europe, not Asia.
In fact, the dynamic of that investment may yet spark a competitive revival in Europe if its politicians follow through on what is happening in the corporate sector.
Europe is experiencing what the U.S. went through 15 years ago. Then, it was a Japanese manufacturing model that forced American industry to recalibrate, retool, and regain competitive drive. Now, for Europe, it's an American model built on flexibility and unsurpassed efficiency in deploying capital.
American auto, telecommunications, software, finance, retailing, and computer companies are bringing to Europe the expertise they gained from battling the Japanese and other Asian competitors around the world. Their new products, technologies, and management techniques are forcing change on European companies, sometimes brutally so. But they are also forcing Europe to break out of the Old World's conceit that it can do well in a global economy simply by boosting trade within its own borders. It is this idee fixe that is behind the push for forging a single European currency.
Massive restructuring in the U.S. didn't cause massive unemployment because its entrepreneurial economy absorbed displaced workers. That isn't the case in Europe, and won't be as long as its governments resist giving up hammerlock control over their economies. From zoning laws to shop-closing hours, the real threat to Europe's ability to compete in a global economy is within. Without the political will to change, that's one problem even Yankee ingenuity won't solve.