94Ha Viewpoint
We must be aware that these four aspects are deeply rooted structural issues in European politics, society, and economic systems, and cannot be easily transformed. However, looking at the global perspective, we must also realize that these problems are not unique to Europe; rather, all countries or economies could potentially fall into the same pitfalls as old Europe. This is something that every country must be vigilant about.
Regarding the reasons for the decline of old Europe and why Germany has shifted from being the economic powerhouse of Europe to lagging behind, many economists and experts on German issues have provided extensive analysis and commentary. Factors such as the impact of the pandemic, high energy consumption, wars, rapid increases in energy prices, high inflation, and sluggish manufacturing growth can all weigh down the economic performance of Europe. However, in my view, these factors do not touch upon the core and essence of the issue. After all, the United States, also a Western country, has not experienced the same decline as Europe. In fact, in recent years, the U.S. has made significant breakthroughs in the field of artificial intelligence (AI) and areas such as all-purpose nuclear fusion and room-temperature superconductivity, shining brightly. Therefore, we must identify the problems in other aspects.
I believe that the core issues of old Europe can be summarized as follows:
Firstly, the conservative stagnation and counterproductive actions in immigration policy. On one hand, there are restrictions on attracting various talents, including high-tech talents, from around the world. On the other hand, there is a generous acceptance of millions of refugees from the Middle East and North Africa out of humanitarian considerations. These refugees not only find it difficult to integrate into European culture but also often exacerbate social tensions and conflicts due to religious beliefs. Incidents such as the multiple terrorist attacks in France and recent knife attacks in Germany are examples of this.
When I was pursuing my doctoral degree in Germany around 2006, German society had already begun to discuss whether they should consider adopting Canada’s immigration points system for citizenship, in order to select the best of the best. However, until today, we have not seen any substantial improvements in this regard. German society remains as it has always been, self-righteous and resistant to change. This has led to the inability to not only attract a large number of fresh blood from overseas but also to fall short in providing an open, inclusive, and free innovative and economic environment.
In contrast, the United States, with its developed economy, abundant opportunities for growth, diverse culture, and more attractive immigration policies, has become the most favored destination for immigrants, attracting outstanding talents from around the world. Apart from the well-known figures like Elon Musk, tech giants such as Sergey Brin of Google, Max Levchin of PayPal, and Phil Libin, former CEO of Evernote, are all examples of tech veterans who immigrated to the U.S. at a young age.
According to statistics from the U.S. Policy National Foundation in October 2016, between 1901 and 2016, immigrants in the U.S. had won 104 Nobel Prizes in the fields of chemistry, medicine, and physics. Particularly since 2000, immigrants have accounted for 40% of the 78 Nobel Prize winners in chemistry, medicine, and physics in the U.S. This shows the significant impact and contribution of global immigrants to the field of science in the United States. In contrast, Germany and even the whole of Europe cannot be described as anything other than lackluster in comparison.
Secondly, bureaucracy prevails and efficiency is generally low. I remember many years ago, some top scientists in Germany complained that it takes approximately a year from project approval to funding allocation, while in the U.S., it only takes a few weeks, not to mention emerging companies like OpenAI that can quickly raise substantial capital from the market. This has led to more and more German scientists moving their research bases to the U.S. or simply immigrating there, eventually transforming their innovations into new products through the American market.
In a recent speech, former Google CEO Eric Schmidt expressed disappointment in the bureaucratic nature of Europe in the field of AI. He believes that Europe has always lacked sufficient investment and determination in technological innovation, leading them to fall far behind the U.S. While France shows some potential, Germany and other European countries seem to be struggling. As he said, because of bureaucracy, the EU headquarters in Brussels has been destroying opportunities for technological innovation. This will inevitably lead to further conservatism and backwardness in the development of AI in the whole of old Europe, further causing its decline to be overshadowed by high technology.
Thirdly, the comfortable living under high social welfare has led to a lack of competitiveness and a sluggish market in Germany and the rest of Europe. They are still indulging in the mechanical manufacturing kingdom they once created, lost in self-admiration, and have forgotten that humanity has entered a whole new era led by AI. In contrast, the United States is currently the most active market economy in the world, with the most well-established legal environment. Although the U.S. economy faces numerous challenges today and is no longer comparable to the economic freedom of the 19th and early 20th centuries, it is still the most market-oriented economy in the world, encouraging and safeguarding investments and innovations.
Schmidt’s remarks during his speech bluntly criticized the over-perfect social welfare system in Europe, likening it to a nanny that never leaves your side. This is also the point that struck me the most deeply. Just imagine, even if people do nothing, living under this system ensures warmth, food, and worry-free living. In such a wonderful and comfortable environment, where is the urgency to seize the day? Where is the dedication to work tirelessly? Where is the fierce competition and ever-evolving innovation? All that seems to be nurtured is a bureaucratic attitude of treading water, a hedonistic lifestyle of comfort, and even a complacent attitude of indifference to progress. Of course, even large American companies occasionally face similar issues. Schmidt sharply pointed out that tech giants like Google are facing a crisis of being too comfortable and lacking innovation (although he later publicly apologized for his remarks). In his words, “Google focuses too much on work-life balance for employees, rather than fully committing to AI competition.”
If employees only come to the company one day a week, how can the company maintain a leading position in the field of AI? This has made them appear inadequate in the competition against companies like OpenAI and Anthropic. “Look at Musk, look at TSMC, these companies succeed because they can push their employees. You have to push employees hard enough to win. TSMC makes physics Ph.D. students work in factories in their first year. Can you imagine American Ph.D. students working on assembly lines?”
Fourthly, in terms of scientific civilization, scientific culture, and scientific environment, the situation is less than satisfactory. Some may think that the recent brilliant achievements in high-tech fields in the United States are due to the largest funding and the most number of scientists. However, as independent Chinese scholar Ma Guochuan pointed out: it is more about whether a society has a better scientific culture and scientific environment; the key is to respect freedom and innovation. This is why Musk can engage in rocket and Mars exploration in the U.S. but not elsewhere in Europe.
Renowned economist Joseph Alois Schumpeter once said: what is innovation? Innovation is disruptive destruction. The car disrupted the carriage, AI disrupts traditional industries. Therefore, vested interests and old ideas and concepts will inevitably remain vigilant, hostile, and even suppressive. What is needed is a good, free, inclusive, and open environment that allows all scientists to think freely, act freely, create freely, and innovate freely. The most fatal crisis faced by Europe today is the lack of an innovative environment, and the spirit of innovation has died.
In summary, old Europe, especially Germany, falls short in the above four aspects, leading to a visibly aging appearance in high technology and economic growth.
Although old Europe was once the cradle of the Industrial Revolution and the rise of capitalism, boasting numerous world-class ideas, technologies, and products in its glorious past, what does all that amount to in the face of the tide of time, in the face of disruptive innovation? This is like a small family workshop in China more than 150 years ago, driving horse-drawn carriages and creating exquisite crafts, facing the steam engines and mechanized mass production coming from Europe, so fragile and vulnerable, barely able to withstand a blow. Today, it is old Europe that must face the impact of AI from the United States with outdated technology and products.
Of course, we must be aware that these four aspects are deeply rooted structural issues in European political, social, and economic systems, and they are by no means easy to change. However, looking globally, we must also realize that these problems are not unique to Europe; rather, all countries or economic entities that are lacking in these four aspects or even worsening may risk repeating the mistakes of old Europe. This is something that all countries must be vigilant about.
(The author is a Chinese international law scholar)
