What is to be the result of high taxes, restrictive employment polices, burdensome social welfare projects and reduced economic incentives for businesses? In a word: stagnation. Several of Europe’s leading economies are experiencing this reality first had as they continue to stagnate in the fall out from years of socialist policies, which continue to take their toll across Europe.

According to recent figures, Germany’s economy, barely growing as it is, experienced a slowdown in 2005. The German economy grew by less than 1% last year, down from 1.4% during the previous year (Compared with over 4% for the US economy). After eight years of leftist leadership under Chancellor Gerhard Schroeder, the Germans should be thankful their economy is not in recession. Nonetheless, economic growth shows no signs of recovery in early 2006, unemployment remains high, over 10%, and business expansion is nonexistent. One would hope that under the conservative leadership of Angela Merkel, Germany’s fortunes would improve, but given the fact that she leads a fragile left-right coalition government, such hopes may prove fleeting.

Germany, however is not alone, both France, Italy, Belgium and the Netherlands are reeling from ongoing economic stagnation, some nations, like France also must confront continued social decay as symbolized by last year’s riots. Until these countries move to create favorable environments for business and encourage individual entrepreneurship, while also lifting leftist policies that restrict firing of inefficient and incompetent workers, one can expect Europe’s stagnation to continue.
http://news.bbc.co.uk/2/hi/business/4604986.stm