Saturday, May 29, 2004

Overtaking the United States or Lisbonization

Back in the 1960s Nikita Khrushchev announced that the Soviet Union would catch up with the United States in a certain number of years. As it happens, his comrades buried him before he had time to bury the Americans. The whole idea produced a typical Soviet joke: "Yes, we shall catch up with them but we must not overtake them or they might see the holes in our pants."

Of course, things are not nearly so bad in the European Union. But all this talk of overtaking America is beginning to be wearisome. It’s all to do with that Lisbon process, which has delivered absolutely no results. According to Romano Prodi and Mario Monti, both speaking at the Economic and Social Council on May 25 the aim is to make the EU the most competitive economy by 2010. As we have already noted on the blog, in the last year almost all of the member states have slipped down in the competitiveness stakes in the last year.

Nothing daunted, Mario Monti, Romano Prodi and representatives of the social partners – business groups and trades unions – are calling for action on the Lisbon agenda. Most of the action is to be on the budget or as it is known in Brussels parlance financial perspectives, which according to Monti, must be “Lisbonized”. (To be fair, he did admit this was an ugly word.)

It seems that the only economic development the Commission and the social partners understand is more money being spent on some government projects that would define and "promote" competitiveness. The idea that competitiveness was best promoted by lower taxation and fewer regulations is alien to them all.

Oh yes, they have also set up a high level group under former Dutch Prime Minister Wim Kok to look into the failure of the Lisbon strategy. The group will report to the Summit in June – some time during the two days when the heads of state and government must also agree on the text of the new Constitution. June 17 and 18 will be very busy in Brussels.

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