Is our generation going to see the disgregation of the EU - and do nothing about it?
(georgesoros.com)
This isn't strictly a startup thing, but if the EU - or even just the euro - is going to break up, it will have huge consequences on startups too.
And, in my opinion, one consequence would be that any hope that Europe will be going to play an important role on the global innovative startup scene is going to vanish (ie, any big internet innovation with global reach that will come out of Europe will end up in the hands of US companies, like Skype and so many others). What do you think?
Our generation is actively doing about it: western Europeans discriminate eastern Europeans based on their situation. The resulting European Union is not about equality, which is on purpose, deliberately. Therefore it is counter-productive in its current form.
An example from a flagship European research centre, where even our generation discriminates, not to mention that the centre itself has a budget in CHF instead of €:
"1the western equivalent value is 1'390 kCHF. 2the western equivalent value is 5'450 kCHF"
http://lhcb.ecm.ub.es/spd/spd/General%20information/spd_cost_tdr.pdf
This is humiliating to all easterners.
I'm sorry but I didn't understand what you meant...
By the way, CERN isn't a EU institution, Switzerland isn't in the EU and CHF isn't the Euro...
You are right on all accounts, and this is part of the problem. In order for the EU to be successful, it needs three pillars, which build on each other:
All current competitors (USA, China, Russia etc.) have this, which is no accident.
ps: what do you think, Skype is written by whom and how would their valuation compare to nordic equivalents?
I thought Skype was Israeli?
Skype founders are a Danish and Swedish, and the development was done in Estonia. Without a "EU" brand, it's easy to get confused, I guess :)
Wow. Where did I get Israel from? Weird. This is why we need a "Made in Europe" database, I guess.
I completely agree about the common policies, but I think what you say about salaries would get exactly the opposite effect of what you want.
I'll tell you about an example I know pretty well: Italy. We have a southern part that is much less developed than the rich north, but we have had for decades laws that mandate the same salary in the south and in the north, and we have had massive investments (equivalents to cumulated hundreds of thousands of € billion of today in direct investments, tax rebates etc.) by the state there.
The results? Very, very little! Work in Southern Italy is, for a lot of reasons - infrastructures, geography, climate, Mafia, business culture etc. - less productive than it is in Northern Italy, so private investments just don't come, unless it's just to get some government money and then run away as soon as possible.
Lower salaries is a way to attract investments (just think about China and India) which can in turn bring bigger productivity and then higher salaries. It's not the other way around. Even in northern Italy, for example, a factory worker gets much less than a German one on average, not because s/he doesn't work as well, but because the total value of the work is lower than a German's one (again because of infrastructure, perceived value of German brands, etc. etc.).
By the way, a LOT of western Europeans would like exactly what you seem to want, that is: No cheaper labor inside the EU, so jobs would just stay here and not go to Eastern Europe.
Oh, this is quite well put. You can't (entirely) legislate economics. Ask any drug dealer.
Aside from your confusion about CERN, I do agree with your point about systemic and built-in East/West discrimination (or, I think more accurately, "central" vs. "peripheral"). There's a perception that the proper lot in life of peripheral nations is to provide cut-rate labor to Germany and France, without any reduction in cost of living.
In Hungary, for example, the prices at Tesco are just the same as anywhere else in Europe - but the wages they pay their employees aren't. There you see the seeds of economic destruction on the micro level. You can't simply extract wealth from poorer nations - you have to create it, everywhere, or you will fail. I don't see Europe addressing that right now; I think the goal was just to get the Union built and assume it would all work itself out, but it seems to this American that there's an awful lot of history behind the assumption that the "cheap countries" should remain cheap.
excuse me, but what is my confusion about l'Organisation européenne pour la recherche nucléaire??? Their pathological case indeed seems confusing, but that is just smoke and mirrors. And PR.
The fact that it's not in the European Union. Sure, it's in Europe - but Switzerland isn't in the Union. So the fact that its budget is not in Euros is not really an indictment of the philosophy of the European Union.
Seriously? The EU is investing a lot of money in less developed countries in the EU http://en.wikipedia.org/wiki/Structural_Funds_and_Cohesion_Fund
Seeing that you put it this way, I'll ask you how much is the US doing about the countries that provide cheap labor to them (starting from Mexico), besides building fences at the border.
Those funds cut both ways, and can also be seen more of an economic aid to western corporations to acquire eastern markets. Basically a covert export subvention for western multinationals; infrastructure was privatised, and the main owners became the western house-hold names which pull the strings (ie. EON, EDF/GDF, Siemens, RWE just to name a few). Having said that, yes, there is genuine eastern corruption involved too (which doesn't help either), just like everywhere else.
And actually the fences are mostly there: perhaps it was only the UK and other minor exceptions, who didn't impose immigration quotas. The most are benefiting from moratoriums (not to mention the Turkish-German, French-Algerian scenarios). No such fence was raised for ie. commercial entities, global chain stores etc. But you are right, the freedom to work is the official line.
Perhaps the most genuinely whole-hearted and looked-after funds are like the ones from Norway http://www.eeagrants.org/
Uhm... I was under impression that, on the contrary, the UK was the one which didn't adhere to Schengen, and so can effectively impose quotas, which are otherwise impossible. Are you sure there are quotas to come, eg, from Romania to Italy?
Yeah, I don't think this is the case. Certainly the ongoing brain drain from Hungary would indicate that there is no quota system within the Union itself.
But User's main point, that the cohesion fund isn't really enough, is a sound one. It's very true that it helps a lot in infrastructural upgrades to areas that urgently need it, but to my knowledge (admittedly weak) it doesn't go much further than that.
The real damage in the East was done by the transitional governments. There were lots of state-owned companies that were magically sold lock, stock, and barrel to Western corporations with no recompense to the state or to the people - only to top management, who declared themselves the "owners" and diverted all the funds to their Swiss accounts. It gutted the Hungarian economy, and they still haven't recovered.
There is always the possibility to do more, but in practice what would you suggest to improve the situation?
Damn if I know. In Hungary's case, more pride in being Hungarian that doesn't manifest itself in Nazism - but how to achieve that is something I don't know. My wife thinks she can make a difference, going home. Maybe she's right; she went to college with the current government.
The EU is investing a lot of money in infrastructure, yes. But the prevailing attitude is that people in the cheap countries are there for exploitation. Austrians, for example, seem to believe that their purpose on Earth is to act as a go-between, selling the services of the East to the high-priced markets of the West. Ask any translation agency in Budapest or Istanbul.
Two points about your second paragraph.
First, until Europe starts to solve Europe's problems on a European template without saying "It's OK, America does it," you're wasting your time. Trust me, as an American liberal, I can assure you (if you needed any assurance) that the way America does it is wrong, almost always.
Second, (most) Mexicans aren't American citizens, but Hungarians and Slovenians and Portuguese are, in fact, European citizens. This doesn't excuse the sheer lunacy of our immigration law, but it does mean that Europe bears a more direct moral imperative to see to it that conditions within the Union are equitable.
Don't get me at all wrong. I love Europe and I love the mad experiment that is the European Union. Ultimately, the EU is the model on which humanity itself will have to base its future, unless of course our future is a war of all versus all. I tell people that as long as Europeans aren't actively killing each other, the Union is a success - and by that measure, the European Union is a wild success. Don't play it down just because it's hit its first real recession.
And don't even get me started about fences at the border. Jesus Christ, a stupider way of doing things would be really difficult to imagine. This is what happens when morons take control. I mean seriously - taking care of illegal immigration from Mexico is bone-dead simple. All you have to do is make sure employers in the States follow labor law. End of problem. The only reason Latin Americans brave the border is because it pays them to do so. But as long as shady employers get rich off exploitation and finance Republican politics, there will continue to be fences at the borders. Not the Canadian border, of course, because there are white people on the other side of that one.
So - point taken that America is run by idiots. But the point of Europe is that you're not supposed to be. This is why I had such hope for the Union, and so far, on the whole, you're doing a good job. Let's hope you keep it up.
Ok, I see that I got you wrong - when you said "... to this American..." I interpreted it as meaning that you were better in that respect. It wasn't the case :)
As for the exploitation of poorer countries, my opinion is that some exploiting is unfortunately necessary for a poor country to start growing. Being in the EU should make the transition much faster and with much less pain - not just thanks to the structural funds, but also thanks to access to rich markets, freedom of movement etc. - but, historically, I would say that no pain, no gain: There is no magic recipe that I know of.
As for the current problems of the EU, I think that they're in a big part caused by the national politicians of most (all?) countries find it so useful to attribute to the EU every failure, and to themselves every success, knowing that the EU itself could not react (especially as it is mostly run with an intergovernmental model). This created a negative opinion so that now that the only way to stop the crisis would clearly be to have much more integration, public opinions are mostly against that. I just hope that the necessity will become clear enough soon enough: Greece only accounts for 3% of the EU GDP, we would have the means to save it almost without blinking, if only there was the political will to do so.
Ah, yes - I just meant that I don't live in the EU (yet) and so I probably don't know as much about details as I should. I'm a technical translator, most of my clients are European, and my wife is Hungarian, and in a month I'll be living in Budapest, so I have strong opinions, but probably not as much data to back them up as I'd like.
I agree that some exploitation is needed and is just, you know, the underlying economics. Where I stop agreeing is that there is real and persistent prejudice against Easterners (some of which is justified, but that's the origin of prejudice). I feel deep discomfort with Tesco (i.e. prices the same, services the same, profit higher because wages lower) and with the translation industry (the same freelance translators do all translation everywhere in the world, but I get paid less by agencies in poorer countries because the West expects them to be a bargain). I can only draw the conclusion that this is valid for instances I don't personally know about.
And finally, I fervently agree with your point on European politics. All evil is attributed to "Europe" in the same way that all politicians in America will go fight the jerks in Washington for you. It sells well to the voters.
Yes - Greece's economy is tiny in comparison with Germany's, and politicians and bankers alike know that the sane thing to do would be to bail them out and go on. But because of that same prejudice against bailing out the "profligate" lower-class nations, Europe as a whole is feeling the pain. It drives me crazy.
Let's at least try to do something... http://hackful.eu/posts/1129