John,
It is hard not to reach conclusions that you have enumerated, after one accepts the idea that the Europeans are currently waging proxy wars with the US.
You say that it is ìodd that Europeans hope to contend with the US when we have a larger economy and an infinitely more powerful militaryî. But I am very much convinced that majority of political and social elites over there believe their own press releases. If you recall there was this conference in Lisbon in year 2000 in which EU countries declared that by 2010 they will catch up and overtake American economy. This sounded like announcement of the next 10-year plan by the Central Committee and had just about the same connection with economic reality. Money quote: ìIt is widely acknowledged that the March 2000 Lisbon summit marked a watershed in the EU leaders’ rhetorical, if not practical, commitment to thoroughgoing ‘structural reform’ of their labour, product and services markets.î
http://www.ebusinessforum.com/index.asp?doc_id=1792&layout=rich_story
Even relatively decent publication such as Economist could not stop itself from gleefully opining the at the end of year 2000 that American economy was entering period on long term recession, just like Japan, while the prospects for Eurozone were great, with German economy to be growing to the tune of 3%. I suppose all this fantastic growth was to occur because American wealth was somehow unfair (or stolen) and Europeans were finally getting the deserved break.
In reality Eurozone and Germany slumped and we managed to pull through despite the terrorist attack.
(Channeling Europeanís collective thinking: Again, this is so unfair! But wait, the Americans pulled through because they waged a war and everybody knows that wars are good for economy. Such a relief! Yanks pulled another dirty trick and we donít have to change our economic models after all!).
I also recall very serious discussions how, after admitting the new members, the EU would become bigger than the US, with more citizens (or should I say subjects), greater GDP and more numerous army and is destined to finally stand up tall and beat the Americans at their own game.
Clearly, they bought into Leninist concept of quantity being transformed into quality.
Nobody seemed to have noticed that countries that were joining, though fairly energetic, had similar baggage to shed as East Germany when Germanies got reunited. I recall that years following that event were not terribly good in economic terms for citizens of former West Germany.
The EU also has some curios regulation such as one that if a member country runs into deficit exceeding 3 or 5% of GDP (donít remember, too late for googling) they have to hit themselves even harder and pay a humongous fee to the ìcommon poolî. With one size fit all interest rates and money supply, regardless of economic reality of member country, this is nice recipe for economic disaster. (Of course, when it happened to Spain they paid, when it happened to France, they weaseled out. Big dogs, small dogs.)
Other obstacles to robust economic growth are general continental culture of entitlement and deep distrust of American free- market concept. Europeans are determined to do practically anything to avoid coping the wild capitalist uber-liberal (thatís their term for free-market) American economic model. So they prefer to drink their own Kool-aid and come up with excuses how everything is Americaís fault.
Interestingly, for the citizens of newly joined EU countries the immediate benefits for joining are elusive, but prices for such staples like butter, beef and sugar went up by 50%.
I have no idea whether Europe will have a will to build a defense, but I donít think that they will do so. Security forces, such as mobile, heavily armed groups of police, can handle all the anticipated internal problems and unrest. And they probably think that when the worst comes to worst they can conjure enough nukes to eliminate external threat. So, they are sitting pretty. I wish them well. I just want our troops out from there.
