Krugman‚Äôs recent New York Times article on French "family values" cited by Posner is the latest of many attempts during the past decade to justify, high labor taxes, restrictions on the ability of companies to shed employees, a French law that restricts work to no more than 35 hours per week, and various other restrictive labor-market legislation in continental countries. They supposedly lead to more civilized goals than are obtained in the freer Anglo-Saxon markets. That this leads to very high unemployment rates and limited job opportunities, especially for immigrants and young low skilled native-born men and women, and a shortage of part-time work for mothers and others, is the price that apparently has to be paid for these advantages.
But are any advantages of this system worth such a high price? Clearly, the European system of employment helps the "insiders" with good jobs, and works against "immigrants" and other newcomers ,or "outsiders" in labor markets. It is claimed that the European system promotes "family values" over individualistic ones. Yet the data do not support this contention since marriage rates are lower in Europe than in America, and not a single European country has birth rates that are high enough to maintain their populations without continued immigration. The French birth rates are somewhat higher than their neighbors only because of massive subsidies to having children. Yet even the French rates are way below replacement levels and those in the United States.
Workers in France, Germany and other continental European nations are also said to gain more leisure hours that they want and yet are unable to obtain in freer labor markets of the Anglo-Saxon type since each work decision there is made more individualistically rather than collectively. But there is no evidence that these regulations are the result of a strong demand to consume leisure jointly with other families. As Robert Putnam, the author of "Bowling Alone", and others have pointed out, the trend has been just the opposite: sharply away from joint consumption of leisure in clubs or bars, and more consumption through individualistic activities like television and computer games. Is there pleasure in the traffic jams that develop as virtually all the French, Italians, and German families that can afford it go on their August vacations to the same limited number of beach and mountain resorts?
The prospects of declining population and the heavy financial burden from the payments needed to provide generous retirement income and health benefits to older persons would seem to lead European countries to try to attract young immigrants who would pay taxes on their earnings to help finance the cost of these entitlements. The labor market restrictions, however, make it hard for immigrants to obtain jobs in the legal economy, so either they are unemployed, or they work in the flourishing underground economies of Europe, where they avoid paying taxes. Apparently, the French intentionally do not collect data on unemployment rates of their Muslim population, but economists there tell me they believe it is more than double the official overall French rate of over 10 per cent unemployed.
Given the poor work prospects of Muslim immigrants, and the fact that the German, French, Dutch, and other European populations do not generally like their Muslim minorities, it is no wonder that Muslims there feel alienated from the general society. As a result, some of them become bitter, and develop hatred of the West and the fanaticism that leads to radicalism and terrorism. That only feeds greater opposition from the general population, which helps explain why the French and Dutch strongly voted against approving the new European Constitution.
There is an ongoing debate among economists over whether social mobility is greater in the United States or Europe. The general evidence on this does not offer a definitive answer, but there is little doubt that most immigrants believe opportunities for themselves and their children are greater in the United States. This is why America is the first choice of most immigrants whenever they can choose where to go, and it also explains the different attitudes of immigrants in Europe and America. As Posner emphasizes, most immigrants, non-Muslim as well as Muslim, feel far more accepted in the United States than in Europe, are less segregated here in both their living arrangements and employment, and appear to advance more easily toward higher level jobs. As a result, they are less promising material for radical Islam, although clearly radicals are operating and planning in the United States as well as in Europe.
However, the British experience is somewhat disturbing to this thesis, for Great Britain is at least a partial counter example to our analysis. For British labor markets are very much like those in the United States; in fact, Britain has lower unemployment rates than the U.S., has equal labor market flexibility, and provides above ground jobs for Muslims and other immigrants.
I believe the main reason for the difference with the United States is that new immigrants are easily accepted in this country since it is a nation of present or past immigrants. Foreigners of all kinds have never been so welcome in Britain, and are even less welcome in continental Europe. So even under the best of economic conditions, immigrants in Europe do not easily integrate into the general society. Still I confess these vicious attacks on London subways and buses are not only awful, but I also find them difficult to understand.