Here’s a letter that I sent last April to the Wall Street Journal:
Several letter writers rightly criticize former Danish Prime Minister Poul Nyrup Rasmussen’s assertion that today’s economic downturn reveals American-style capitalism to have failed in comparison to modern Europe’s welfare state (Letters, April 7). None of the writers, though, confronts Mr. Rasmussen with the data that are most relevant, namely, unemployment rates.
From 1990 through 2008, America’s unemployment rate averaged 5.5 percent while western Europe’s unemployment rate averaged 8.4 percent – just about what America’s unemployment rate reached only last month [March 2009] (8.5 percent). Moreover, in each and every one of these years, America’s unemployment rate was lower – and in many years 40 and even 50 percent lower! – than western Europe’s rate. How can Mr. Rasmussen rationally conclude that American capitalism has failed relative to European state welfarism if unemployment in the U.S. only last month, for the first time in more than a quarter century, reached a level that has haunted Europeans consistently for the past two decades?
Sincerely,
Donald J. Boudreaux
I thank my son, Thomas, for his pain-staking help in assisting me in calculating these figures.
