Socialist EU Can't Keep Up With US
Wednesday, October 3, 2007
The EU's War On (U.S.) Innovation
Competitiveness: Fresh from their sweeping antitrust victory over
Microsoft, Europe's bureaucrats have another successful U.S.
company in their sites: Qualcomm. The EU says it's all about
fairness, but we know better.
By INVESTOR'S BUSINESS DAILY
Just two weeks after its decision to levy some $631 million in
fines on Microsoft, the EU's antitrust bureaucracy has now
decided to go after telecommunications giant Qualcomm, too.
In case you don't know, San Diego-based Qualcomm is at the heart
of the cellphone revolution. Its innovative chipsets have made it
possible for people the world over, no matter how remote, to have
phone service, and for people in business to be constantly in
touch with their home offices.
That includes, by the way, the 27-nation EU's 493 million people.
When the Microsoft decision came down in late September, European
analysts and lawyers went out of their way to say this wasn't
indicative of some new anti-competitive mood in Europe, but
rather a case of one company abusing its competitive clout and
consumers.
One EU attorney, when asked if there would now be a "rampage"
against American firms, shot back "absolutely not."
Those watching the Microsoft debacle, however, would have been
much wiser to heed the words of EU Competition Commissioner
Neelie Kroes, who fired a warning shot over the heads of all
successful U.S. companies, saying the Microsoft decision "sends a
clear signal that super-dominant companies cannot abuse their
position to hurt consumers and dampen innovation . . ."
The irony, of course, is Microsoft has bent over backwards to
accommodate the EU, letting Europe's sluggard companies freeload
off Microsoft's patents and intellectual property. But, of
course, consumers aren't interested. They want the real thing.
Now, emboldened by its success against Microsoft, the EU's
Orwellian-themed Competition Commission is going after Qualcomm.
Nor will Qualcomm be the last American champion that the EU's
aggressive bureaucrats try to take down. Reportedly, there's a
long list of companies now in the EU's sights, including Apple,
Intel, Rambus and a handful of energy companies.
It seems Europe's rather weak tech sector needs the bureaucrats
to do what they can't - beat Microsoft. The EU's recent antitrust
binge is a form of trade protection and, in all frankness,
amounts to property theft. Trade economists note such actions
will lead to higher costs, less innovation and lower standards of
living for all - not exactly a strong selling point for EU
antitrust theory.
There's no legitimate legal basis for this. The EU simply made
one up. But having succeeded once, it now feels emboldened to go
after any successful American company that does business there.
It's not hard to figure out why.
As we noted not even a month ago, the EU is lagging seriously
behind the U.S. in average GDP per employed person - the
broadest, and most meaningful, measure of productivity.
The average American worker produced $81,454 in real GDP in 2006,
according to recently updated Department of Labor data. By
comparison, the average worker in France put out $73,134, in
Germany $59,870, in the United Kingdom $65,684. And so on.
In short, the EU lags the U.S. in productivity (and thus,
standard of living), and badly.
Why? As we quoted International Labor Organization employment
chief Jose Manuel Salazar nearly a month ago, it "has to do with
the (high-tech) revolution, with the way the U.S. organizes
companies, with the high level of competition in the country,
with the extension of trade and investment abroad."
And that, in a nutshell, is why Europe has declared war on U.S.
innovators and tech champions. It has nothing to do with
"fairness" or "consumers" or even "antitrust." It's really a fear
of the future.
The EU has stuck itself in a competitive mire with its stiff
labor rules, extensive welfare state, high taxes and refusal to
innovate. Its bureaucrats clearly fear the EU's statist ways will
consign the continent to also-ran status for the remainder of
this century.
Having no easy answer for Europe's ills, they attack America's
best. But they do so in the courtroom, not in the marketplace.
That might work for a little while, but it's no strategy for
greatness. The EU and the U.S. account for 40% of world trade and
investment - nearly $3 billion a day crosses borders. But
Europe's rampant rule-making saddles companies there with $850
billion a year in costs. And its ridiculous labor laws create
near-double digit joblessness.
The EU won't grow any faster by taking down America's high-tech
winners. Nor will the EU's people - having less choice and facing
higher prices - be any happier. It's bad for them, and bad for
us.
It's time for the EU to end its economically foolish antitrust
war against U.S. high-tech champions, and start competing for
real
--
Regards
Bonzo
"When I, with some colleagues at NASA, attempted to determine how
clouds behave under varying temperatures, we discovered what we
called an 'Iris Effect,' wherein upper-level cirrus clouds
contracted with increased temperature, providing a very strong
negative climate feedback sufficient to greatly reduce the
response to increasing CO2. Normally, criticism of papers appears
in the form of letters to the journal to which the original
authors can respond immediately. However, in this case (and
others) a flurry of hastily prepared papers appeared, claiming
errors in our study, with our responses delayed months and
longer. The delay permitted our paper to be commonly referred to
as 'discredited'." Dr. Richard Lindzen, Professor of Meteorology
MIT and Member of the National Academy of Sciences
date: Mon, 8 Oct 2007 11:15:45 +1000
author: Bonzo
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