Europa

Europe, Old and New, no Wall Street Journal:

The bloc's economic record is mixed. This is still a Europe of wasteful farm subsidies, low growth and high unemployment, with rising protectionism and a regulatory zeal unmatched anywhere in the free world. Yet the bad ideas tend to come from bad leaders. When the Brussels bureaucracy and dreams of creating a super-state are checked by a vigilant media and national governments, the Europe construct itself can be market friendly. In the past two decades, the EU on balance has done more to open the door to greater competition than provide a back door, as Margaret Thatcher feared, for welfare policies.

Why? Most crucially, the 1957 Treaty of Rome was inspired by free-market principles. The EU is the world's largest zone for the free movement of goods, capital and people. When individual countries have tried to blunt those freedoms, Brussels has often fought back with vigor. The euro, the world's most successful currency union, has lowered interest rates, promoted internal trade by removing exchange-rate risks and--especially in the Latin countries--made it impossible for governments to inflate their way out of trouble.

Europe's diversity and growing size are also strengths. For each dysfunctional Italy, there's a booming Britain or Estonia or Denmark showing how market-friendly policies pay dividends. In a wider Europe, good ideas squeeze out the bad. The Eastern Europeans have popularized low and flat taxes. Boom-town London is home to hundreds of thousands of Poles and Frenchmen, whose departure is an electoral issue in their native countries, where politicians are realizing they must compete to keep their brightest at home.

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The Continent's leaders could do worse than use their Berlin party this weekend to send the message that Europe's traditional openness--to trade, people, new countries--is the cornerstone of a half-century of success. These first principles from 50 years ago are still worth fighting for.