NYT: Off the Charts U.S. Jobless Rate May Soon Top Europe’s

Pretty straightforward -- the bigger, more costly safety net slows acceleration on the way up and cushions the fall on the way down.

http://www.economist.com/world/europe/displaystory.cfm?story_id=13610197

Yeah, but no one expects this to remain a long-term thing. The average employment rate and more importantly the average percentage of working age people in the workforce has been and will remain higher than in Europe as a whole per all estimates over the long run. I mean, if We have literally 10-15 percentage points higher labor force participation, its actually absurd to say that we are comparable to Europe. In the U.S., you have like 68% of adults actively in the work force. In France ts like 55%. Even the UK, Ireland, and the Netherlands - the "best" performers of the E.U. structurally have less people in the workforce to begin with. So a 100 or 200 basis points higher U.S. unemployment rate then Europe STILL leaves a much higher percentage of our population actually in the workforce.

From that economist article:

"France’s jobless rate (8.6%) may now be the same as America’s (8.5%). But, unlike America’s, it never falls much below 8% even in good times.

The upshot is a split employment market. On one side, decent permanent jobs, protected by industry-wide conventions negotiated by the unions. On the other, unprotected short-term work—or none at all. The young are particularly shut out: joblessness for the under-25s is 21%. On some housing projects in the heavily Muslim banlieues, the rate is double that."

Just something to think about. I like the idea of universal health care and such, but its not like its either the French way or the American way and nothing in-between. In fact in many ways not only the Dutch but amazingly the Skandies are (in recent years) are in-between in many areas.

And this illustrates my point as well

http://graphics8.nytimes.com/images/2009/05/22/business/economy/0523-biz-webCHARTS.gif

I disagree with the article. Spain's unemployment rate is 18%. We are nowhere near that number, thank goodness!

Europe has always had higher unemployment rates because, since ther unemployment benefits are so generous, there is no incentive to work. And unlike in the U.S., Europeans do not need to work just go get health insurance since the govt. gives it to them.

Its a pretty complicated issue. Bottom line is that being unemployed sucks a whole lot more here than in France. Yes that is partly why more people remain unemployed there. But we had to throw a whole lot of money at the economy just to keep ours down to 8.5%.

Jason, i agree that something in between is preferable. I just read this on the treadmill the other day and thought it was a good read that was applicable for this thread.

But I think with our system the young are going to get shut out as well, and I have been reading quite a bit about economists here expecting structural unemployment levels to become significantly higher, upwards of 7%, which isn't that far from France's standard 8%.

alpine, the U6 is at about 15% or so. the U6 becomes much more relevant than the U3 in circumstances such as these.

Right, but aboutready you forget that labour force participation is much lower in almost all 25 EU nations, and averages like 1000 BP lower. So the amount of people permanently not in the labour force in Europe exceeds our entire standard unemployment rate. This is really what the impact of the social programs are, not what Alpine says as much. In the Netherlands and Denmark, making the programs force more people to work both lowered unemployment AND increased larbour force participation substantially. I like those models (especially the Dutch) much more than the UK or France, the two examples we hear about so much from the fearmongers on the right.

http://johnquiggin.com/index.php/archives/2009/05/23/refuted-economic-doctrines-8-us-labor-market-superiority/

Which is better? The big problem with strong employment protection is that it tends to create an insider class of well-protected permanent employees and an outsider class who are either unemployed or assigned to some form of semi-permanent “temporary” status (see, for example, the tenure system in universities). But, comparing the EU and US as a whole, the opposite seems to be the case - there is a sharper class divide, and less social mobility in the US than in the EU.

"less social mobility in the US than in the EU." well, that is a stretch. what will make the labor market less flexible in the middle term is the quantity of people with negative equity. but that will not last more than a decade or so. americans are still willing to move across the country for a job but they are tide up to their homes for now. in the long term, europeans will not relocate as easily as americans do.

cost of a safety net? are you serious? what safety net? do you know that in usa women still go to work after 3 weeks of giving birth instead of after 2 years like in hungary? the gov doesn't pay a penny towards child care (only helps by making it possible to pay it pre tax) instead of 90% of it like in netherlands? what safety net are you talking about?

what is shocking to me is that in usa, a country where you lose your job and can end up literally in the street (in eu unemployment benefits pay much more and are much longer) people still save much less than in europe, even thought the rainy day in usa could get really tough and there's not a whole lot of family safety net either (unlike in eu). people are much more willing to go paycheck by paycheck (even those that could save by, for example, buying a used car versus new...). so far i can only explain it through the higher optimism that americans tend to have about the future, but still, it's plain dumb.

Studies have actually shown that there is MORE social mobility, at last inter-gererationally, in most EU countries and Japan versus the U.S. As in, those born in the lowest 20% income group in France or the Skandies or the low countries are more likely to be int he top 20% as adults versus the U.S. There are a number of reasons postulated for this, but the easiest for most to understand is the stratified school system in the U.S. which is based laregly on how wealthy your neighborhood is, as opposed to unified school systems in japan and France. So a poor kid in japan has the exact same schooling as an upper middle class kid, which is not true at all in the U.S. In addition, many EU coutnries have publicly funded school choice.

very true, in usa the school system exacerbates inequality instead of correct for it, which should be the goal imho.

but social mobility is not only how many low 20% move to the high 20%. in usa, if you are middle class you have more chances of ending at the top with entrepreneurship and high iq. there still (seem to me) to be more self-made rich than in europe. but that might be changing too.

I think our higher education system compensates for the lower somewhat, or has up until now. With the cost of education becoming so exorbinant, and the rewards for that higher education becoming increasingly less apparent at a very fast rate, and the upcoming student loan default issue, i fear that system's ability to provide socioeconomic mobility will be greatly hindered.

Yes, true admin, but the fact is every study I have seen on the topic says that there is MORE social mobility in most other OECD countries than the US, DESPITE our entrepreneuriship. Its simply untrue to assert otherwise, despite Oprah saying she only could have succeeded in America. Plenty of lower and lower middle class Europeans and Japenses end up rich as well, just fewer are self-made.

#1 problem with the education system here - it should not be funded (primarily) by local property taxes. How can that possibly lead to an equitable system unless the state and/or feds kick in enough funds to make up for the shortfall?

I know that there have been numerous studies that show that per student funding doesn't lead to higher test scores, but the U.S. also lacks the homogeneity and social cohesion of many other countries.

nyc10023 -- I totally agree with you regarding the local-funding problem. It's insanely stupid, especially because public education was one of the few things that, from colonial times, was expected by all to be government-funded. I wonder how and why the local and state funding system developed, rather than a solidly national one.

alanhart, i believe there used to be more of a federal component, although it has long had the property tax revenue or local initiatives causing differentials in quality. I believe during the Reagan years a number of areas that used to be more of a federal/state collaboration were shifted to the states.

Actually, not true. The department of education is very new. There was never really a federal component at all until the 60s. It was local for almost 200 years, except in HA, where it was always state-wide. NOW some other states, usually because of court cases, have unified or semi-unified funding. But that is just part of it. In say France and Japan its a unified curriculem nationwide (one that no doubt includes spelling, which I lack.) There really no variation at all. This is something I think even liberals might not like in the U.S.

What other european countries DO do, that liberals generally hate here, it offer publicly funded school choice, even for religious schools.

I bet evolution is on the Fr. and Jap. curricula.

"#1 problem with the education system here - it should not be funded (primarily) by local property taxes."
100% agree

"I bet evolution is on the Fr. and Jap. curricula."
no kidding. just the fact that people want their kids to get all the answers from a single book (bible, modified several times by an always anachronistic and controlling institution) is a shocker.

i get hte same shock when an obese person complains that health insurance costs are too high. fat people just cannot qualify for health insurance in many places in europe, cause they are not a risk but a certainty of higher future claims. i don't want that to be the case in us, but i get the same shock when people don't realize that their bad choices are driving prices higher too. should be a no brainer, but it's not somehow.

one of the many things i did briefly after graduating from college was to work for an educational publisher, Holt, Rinehart & Winston. Not a single textbook went to print until it was approved by the Texas state board of education.

Don't get me started. That's why I could never be a physician - poor choices, indeed.

AR: one of the nice things about a private school education back in the lax days of the 80s. No-one cared/monitored what I read. I was reading all sorts of inappropriate stuff by 10.

admin: the vast majority of the $ spent on someone's health is spent in the last year of that person's life.

no, that's medicare that has a population of over 65. calculating the average doesn't make a whole lot of sense in the health care system. the outliers (young with a very expensive disease, a weird type of cancer for example) is why the system of pooling risk exists.

the spending on trying to prevent the inevitable is a shocker to me too. people go to church for decades but are still terrified of dying? they might not be buying the idea of heaven that much.

Yeah, I don't get why religious people fight so hard NOT to die. Wouldn't it be a type of final ecstasy?

"Not a single textbook went to print until it was approved by the Texas state board of education. "

what were they looking for? why wasn't california's approval (or other state) the more strict one?

they needed California's as well, but texas had veto power. they wouldn't put in their orders until they had approved the text, and the publishers caved. as texas was the more restrictive, the texts didn't usually go to California until after Texas approved (depending on the subject, math may have gone simultaneously). i don't know for how long that situation existed, but it was in place and had been for awhile in 1985.

10023, i let my daughter read all sorts of "inappropriate" stuff now. to hell with the tightasses.

and why don't we have compassionate assisted suicide for the terminally ill? Washington and Oregon states have it. The voters in Washington voted 60% in favor of the referendum.

"fat people just cannot qualify for health insurance in many places in europe,"

Where exactly is that? Since all of the EU countries have universal coverage, there are NO uncovered people...

jason10006, I know that in the UK, private health insurance is also available, and (as in the US) many employers provide it as a perk. It's probably similar in other countries in the Europe. I'm also curious to know which.

Yes, you can top off insurance or buy privat insurance in many european countries...and others like Germany and the Netherlands have private insurers as part ofthe Universal coverage...the Dutch system is probably where Obama's plan will end up. But anyway fat people not being covered is a hallmark of the US system, not any Eurosystem I ahve heard of.