Foreign PolicyForeign Policy

Adam Tooze: Why the economic gap between the U.S. and Europe is growing

By Cameron Abadi

23 Jun 2023 · 8 min read

informed Summary

  1. The U.S. economy is now larger than the combined economies of the EU and U.K., at $25 trillion vs. $19.8 trillion, a reversal from 15 years ago when Europe's economy was $1.5 trillion larger, explains economist Adam Tooze in this interview with @ForeignPolicy.

The U.S. economy is now bigger than the EU and U.K. economies combined, at $25 trillion vs. $19.8 trillion—a reversal from just 15 years earlier, when Europe’s economy was $1.5 trillion larger. And it’s a trend that seems to be growing. The U.S. economy has low unemployment and continues to grow. The mood in Europe, meanwhile, is grim, with Germany staring down recession and still struggling with inflation. And that mood tracks with the anxieties of European policymakers, who swing from fear that the United States isn’t committed enough to the fight in Ukraine, to anger on its lack of coordination on economic issues ranging from China to climate policy.

Is Europe sinking into chronic stagnation? Does the United States use its military superiority as leverage on economic issues? And is Europe suffering from depending on others for cutting-edge technology?

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