Dominik Leusder in Phenomenal World:
“You’re losing.” This was the blunt message the head of the world’s largest bank delivered to European policy elites in July last year. Addressing an audience at the Irish foreign ministry, JP Morgan’s Jamie Dimon warned that Europe’s global competitive position was eroding, a view he elaborated on in a letter to shareholders this April and at a subsequent Council of Foreign Relations event. His central claim is that “Europe has gone from 90 percent US GDP to 65 percent over ten or fifteen years,” a divergence in economic fortunes he attributes to Europe’s fragmented internal market, “anti-business” regulatory and tax burdens, “rigid labor regulations,” high welfare spending, and high public debt in concert with low growth. By contrast, America remains the “preeminent economy” and “the most prosperous nation the world’s ever seen,” largely on account of the things Europe currently lacks and undermines.
Although Dimon’s claim is bracketed by larger geoeconomic concerns—namely, the need to reverse Europe’s decline in order to bolster a US-led Western bloc in a fracturing multipolar world—it is easy to locate it in the broader “America versus Europe debate” about transatlantic living standards, a marriage of the intra-European “eurosclerosis” narratives of the 1980s (which reemerged during the 2010s eurocrisis) with various strands of American exceptionalism, whose prominence has risen with the temperature of US politics. The debate has gained further momentum since the pandemic, driven by renewed European fears of “falling behind” in the wake of the Biden era fiscal and industrial policies, fears that are being amplified by the ongoing AI investment boom. In late 2024, in a policy document that has come to define elite consensus on Europe, former European Central Bank head and technocratic grey eminence Mario Draghi lent his considerable support to the idea that Europe’s economy has been declining relative to the United States since 1995, on a continuous downward trajectory that is set to continue. In his letter, Dimon exhorted the US to “do whatever it can to help—or even push—Europe [into] adopting the reforms in the Draghi report.”
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