Europe isn't in a rough patch. It's running the Argentina playbook, one reasonable-sounding decision at a time.
🏭 Industry is leaving. German industrial output sits ~10% below 2018, and the country is shedding roughly 15,000 manufacturing jobs a month. VW closed a German plant for the first time in its 88-year history and is planning for 3 million fewer cars a year. BASF cut 2,800 jobs at Ludwigshafen, then opened an €8.7B complex in China. Thyssenkrupp is cutting 11,000. ZF up to 14,000.
⚡ The reason is cost. German industrial power runs ~18-20¢/kWh vs 8-14¢ in the US and 7-12¢ in China. Once a cracker or blast furnace goes cold, it rarely restarts.
🚗 The new car plants in Europe are Chinese. BYD in Hungary, Xpeng in Austria, Leapmotor in Spain. Chinese brands doubled their EU market share in a year.
🇫🇷 France is 117% debt-to-GDP with 0.0% growth. Interest costs went from €36B in 2020 to ~€60B+ this year. Four prime ministers in under two years. Parliament couldn't even pass a budget on time.
📉 The EU was 21% of global GDP in 2000. It's ~14% now. Since 2008, US real GDP has doubled. The EU's grew ~20%.
💸 Draghi's own report: not one EU company worth €100B+ has been built from scratch in 50 years. US VC outraised the EU roughly 5 to 1 since 2020. Everyone endorsed his fix. About 30% got implemented.
🔥 Gas storage hit record lows heading into winter. Meanwhile the EU banned Russian pipeline gas and imported record volumes of Russian LNG instead.
🏃 France lost 800 millionaires in a year, Germany 400. When the productive base shrinks, the state stops taxing what you earn and starts taxing what you own. That accelerates the exit.
Argentina was richer per head than France in 1930. It had institutions, rule of law, and the assumption it would always be rich.
Wealth isn't a stockpile. It's a flow. Europe stopped refilling the tank decades ago.