L'Europe, la Tech et la Guerre

Read the full article in the Frankfurter Allgemeine Zeitung

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Die US-Unternehmen glänzen nicht nur dank aufgeputschter Spekulanten. Sie investieren wie die Weltmeister. Die Forschungs- und Entwicklungsausgaben allein dieser sieben Unternehmen übersteigen die Bildungsausgaben in Deutschland. Bund, Länder und Gemeinden gaben dafür voriges Jahr 185 Milliarden Euro aus, die „magnificent seven“ 240 Milliarden Dollar. Amerikanische Konzerne stecken nach einer Analyse des Tech-Experten Oliver Coste rund sechsmal so viel in High-Tech-Investitionen wie ihre europäischen Gegenstücke.

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Europa bestraft das Scheitern

Gibt es denn nichts in der Mitte? Ein System, das die amerikanische Dynamik mit europäischer Absicherung und Lebensqualität versöhnt?

Es gibt viele Vorschläge, wie die Wirtschaft in Europa produktiver werden kann: weniger Bürokratie, mehr Unterstützung für Gründungen aus Universitäten, mehr Mut zu neuen Techniken – und eine Kapitalmarktunion, die fähigen Gründern Geld aus ganz Europa bringt. Vielleicht muss der Blick aber auch bloß Richtung Skandinavien gehen. Und zwar in Sachen Arbeitsmarktpolitik.

Das Problem Europas hat nämlich auch mit dem Arbeitsmarkt zu tun. Analysiert hat es der Franzose Oliver Coste. Er hat wie kein Zweiter die Frage untersucht, warum es in Europa keine Nvidias und Amazons gibt. Sein Ergebnis: Europa bestraft das Scheitern. Wenn Geschäftsprojekte keinen Markt finden, sind die Kosten hier deutlich höher als in den USA. Seinen Untersuchungen zufolge kostet es in Europa bis zu zehnmal mehr, einen Geschäftszweig abzuwickeln, als in den USA oder China.

Coste hat es selbst erlebt als Manager der Firma Alcatel. Sie hatte 200 Millionen Euro in eine neue Technologie für Telekommunikation investiert. Coste war für die Abwicklung zuständig. 1000 Ingenieure in Deutschland, Frankreich und anderen Ländern verloren ihre Stelle. In Deutschland dauerte das aufgrund der Arbeitsschutzgesetze 2,5 Jahre, in Frankreich etwas weniger. Währenddessen war das Unternehmen beschränkt, neue Leute für andere Projekte einzustellen.

In Europa kündigten Technologiekonzerne wie Nokia und SAP jüngst ebenfalls Umstrukturierungspläne an. Nokia will sich von 14.000 Beschäftigten trennen und wird die Umstrukturierung erst 2026 abschließen können, trotz eines schockierenden Gewinneinbruchs. SAP braucht für 8000 Stellen rund 18 Monate weltweit, in Europa mehr als drei Jahre.

Was für ein Kontrast zu Amerika: Hier entließ Microsoft im Januar 2023 rund 10.000 Mitarbeiter, stellte Abfindungskosten in Höhe von 800 Millionen Dollar zurück, was knapp sechs Monatsgehältern je Gefeuertem entsprach. Ähnliche Größenordnungen gaben es bei Entlassungsrunden von Meta (4,2 Monatsgehälter), Google (7,5 Monatsgehälter) und Twitter (drei Monatsgehälter). Das amerikanische Arbeitsrecht erlaubt den Unternehmen radikale Strategieschwenks, wie der schnelle Erfolg des KI-Sprachmodells ChatGPT eindrucksvoll belegte. Microsoft straffte unverzüglich seine Belegschaft und machte gleichzeitig zehn Milliarden Dollar für Open AI locker. Meta fuhr seine Metaverse-Bemühungen zurück, entließ binnen weniger Monate 20.000 Mitarbeiter und erhöhte zugleich seine KI-Investitionen, indem es im Jahr 2024 satte 37 Milliarden Dollar für die Computerinfrastruktur ausgab. Google feuerte 12.000 Mitarbeiter, investierte mehr als 40 Milliarden Dollar in KI-Projekte und stellte Zehntausende von Ingenieuren mit KI-Hintergrund ein.

Erfolgreiche Start-ups kommen vermehrt aus Skandinavien

Der Technologiesektor ist besonders, glaubt Oliver Coste: Vier von fünf Projekten, die von großen Unternehmen begonnen werden, scheitern. Das macht die Kosten für Fehlschläge zum Standortfaktor. Für Wagnisfinanzierer wird Europa unattraktiv, wenn Flops so teuer sind. Innovationen, die zu tiefgreifenden technologischen Umbrüchen führen, finden laut Coste daher zunehmend in Großkonzernen wie den „magnificient seven“ statt.

Was tun? Coste schlägt vor, den Kündigungsschutz stärker nach Gehalt und Ausbildung zu differenzieren. Wer viel verdient und exzellent ausgebildet sei, finde in der Regel schneller einen neuen Job als jene, auf die das nicht zutreffe. Bei gut ausgebildeten Beschäftigten mit einem Einkommen über 50.000 Euro könnte der Kündigungsschutz wegfallen. So ließe sich ökonomische Effizienz mit staatlicher Fürsorge versöhnen. Coste nennt das „Flexicurity“. Es ist das Konzept, mit dem Dänemark seine Arbeitsmarktpolitik schon in den 1990ern reformiert hat.

Auch die Yale-Ökonomin Fiona Scott Morton blickt nach Skandinavien, wo der Kündigungsschutz oft lockerer ist als in Mittel- und Südeuropa, das soziale Netzt die Entlassenen dafür aber besonders gut auffängt. Die wenigen erfolgreichen europäischen Start-ups kommen tatsächlich auffällig oft aus Skandinavien.

Read the full article in the Frankfurter Allgemeine Zeitung

English translation (by OpenAI)

Comfortable in Europe, Wealthy in America

By Patrick Bernau and Winand von Petersdorff-CampenDecember 20, 2024

Americans are now much wealthier than Germans. But their lives are far more demanding. Can we have the best of both worlds?

Looking at the United States from Germany's state of perpetual stagnation, it’s easy to feel envious. America has long shown industrialized countries like Germany, France, and Italy how to achieve economic growth.

In the early 1990s, reunified Germany and the U.S. were approximately equally prosperous. Today, the U.S. boasts a per capita economic output that is about 50% higher. On average, each American generates roughly €30,000 more annually than Germans. Even accounting for the higher cost of living in the U.S., Americans can still afford about 20% more than Germans. This surplus funds a formidable military that doesn’t fear Putin. Even in the poorest state, Mississippi, people can afford more than in Germany, as economist Jacob Kirkegaard recently calculated.

U.S. Companies Lead the Way in Investments

The gap between the two economies has grown steadily since the 1990s but widened significantly after the COVID-19 pandemic. Following the crisis, the U.S. economy grew three times faster than other G7 nations. In October, the International Monetary Fund noted that the U.S. economy is the only one among the G20 to not only return to its pre-pandemic growth trajectory but exceed it.

The driving forces behind this success are the “Magnificent Seven”: Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia, and Tesla. These superstar companies are collectively valued at $18 trillion on the stock market—nine times the combined value of all 40 companies in Germany’s DAX index.

These U.S. giants don’t shine solely due to speculative stock market enthusiasm; they invest heavily. The combined research and development budgets of the "Magnificent Seven" exceed Germany’s national education expenditure. Last year, Germany’s federal, state, and local governments spent €185 billion on education, while the seven U.S. companies collectively spent $240 billion. According to tech expert Oliver Coste, American corporations invest about six times more in high-tech compared to their European counterparts.

Not Necessarily a Role Model

The focus on artificial intelligence, quantum computing, and microchip design not only shapes the global future but also fuels productivity—a magical wealth generator. Americans not only work longer hours than Germans but also produce more wealth per hour worked. “Productivity is like fairy dust. It makes everything better. When it increases, it drives growth, dampens inflation, raises hourly wages faster, and boosts profit margins,” writes James Pethokoukis of the American Enterprise Institute.

The U.S. is also laying the groundwork for future prosperity. During the pandemic, the number of startups surged and has remained high. This year alone, one in fifty Americans started a business—double the rate in Germany.

And yet, the U.S. is not universally regarded as an economic role model, even within its borders. Historian Erik Baker of Harvard, whose book How the Entrepreneurial Work Ethic Has Exhausted America will be published in 2025, notes the toll of relentless entrepreneurship. “Europe doesn’t need to regret not having a Google,” says Yale economist Fiona Scott Morton. “Many digital platforms have struggled with sexism, racism, and bullying. Some even pay women to freeze their eggs because they see children and careers as incompatible.” Addressing Europeans, she asks, “Why not leave that to the Americans?”

The Downsides of Wealth in America

German economist Jan Priewe, known for his labor-friendly views, compared various measures of well-being in Germany and the U.S. Unsurprisingly, Germany outperformed the U.S. in several areas. Although median incomes and private consumption are higher in the U.S., Germany has less poverty, better work-life balance, more effective environmental policies, and superior healthcare. The social safety net is tighter, women are paid more equitably, and income inequality is lower.

Indeed, driving through the dying towns of West Virginia, Alabama, or Mississippi makes it hard to reconcile income statistics with the living conditions. Residents of trailer parks and ramshackle homes hardly seem part of the global upper class. According to the World Bank, 1.25% of Americans—over four million people—live on less than $2.15 a day, compared to just 0.2% in Germany.

These issues aren’t new. In 2020, researchers Angus Deaton and Anne Case showed that since the 1990s, mortality rates due to suicide, substance abuse, and alcoholism among white Americans without college degrees had risen dramatically—a phenomenon they termed “deaths of despair.” Other industrialized nations haven’t experienced similar trends.

A Surprising Social Democratic Streak in Americans

Poorly educated workers suffer from globalization, the erosion of families and communities, and an educational divide that condemns those without college degrees to shorter lives with fewer opportunities. Deaton and Case’s research reads like a call for a stronger social safety net to protect the losers of economic trends better than the U.S. government currently does.

Even the outcome of U.S. presidential elections doesn’t reflect broad support for laissez-faire economics, despite the perception created by Silicon Valley billionaires in government. Donald Trump won over the economically distressed, promising jobs better protected by tariffs, more opportunities through limited immigration, and generally lower living costs.

Surprisingly, many Americans hold socially democratic views. Between 60% and 70% of survey respondents believe the government should provide universal health insurance, significantly raise the minimum wage, and tax the wealthy and corporations more heavily.

Europe Punishes Failure

Could there be a middle ground? A system combining American dynamism with European security and quality of life? Many proposals aim to make Europe’s economy more productive: reducing bureaucracy, supporting startups from universities, embracing new technologies, and creating a capital market union to fund promising entrepreneurs across Europe. But the solution may lie in Scandinavian labor market policies.

Europe’s problem also involves the labor market, as analyzed by Frenchman Oliver Coste. He has explored, more thoroughly than anyone else, why Europe lacks companies like Nvidia and Amazon. His conclusion: Europe punishes failure. When business ventures fail to find a market, the costs are significantly higher than in the U.S. Coste’s research shows that shutting down a business can be up to ten times more expensive in Europe than in the U.S. or China.

Lessons from Scandinavia

Coste experienced this firsthand as a manager at Alcatel, which invested €200 million in a new telecommunications technology. When the project failed, Coste oversaw its winding down, which led to 1,000 engineers losing their jobs in Germany, France, and other countries. In Germany, labor protection laws prolonged the process to 2.5 years; in France, slightly less. During this time, the company couldn’t hire new staff for other projects.

Nokia and SAP have recently announced restructuring plans in Europe. Nokia aims to cut 14,000 jobs but won’t complete the process until 2026, despite a shocking drop in profits. SAP is taking 18 months to eliminate 8,000 positions worldwide, while in Europe, it will take over three years.

In contrast, the U.S. tech sector exemplifies agility. Microsoft laid off 10,000 employees in January 2023, allocating severance costs of $800 million—roughly six months’ salary per employee. Similar severance packages were seen with layoffs at Meta, Google, and Twitter. Meanwhile, U.S. labor laws allowed companies to pivot quickly, fueling Microsoft’s $10 billion investment in OpenAI, Meta’s $37 billion in AI infrastructure, and Google’s $40 billion in AI projects.

The Path Forward

Coste believes the tech sector’s high failure rate—four out of five projects fail—makes the cost of failure a critical factor. For venture capitalists, Europe is unattractive if failures are prohibitively expensive. Coste suggests adapting labor laws to differentiate protections by salary and education level. Highly skilled workers earning over €50,000 would face less stringent job protections, as they typically find new jobs more easily. This would reconcile economic efficiency with state care, a concept he calls "flexicurity," inspired by Denmark’s labor market reforms in the 1990s.

Yale economist Fiona Scott Morton also points to Scandinavia, where labor protections are looser than in Southern and Central Europe but complemented by robust social safety nets. Unsurprisingly, Scandinavia is home to many of Europe’s most successful startups.