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|\| ART BLOG HUMOR BLOG PHOTO BLOG CULTURE BLOG |:| FOR THE RENAISSANCE MAN & THE POLYMATH WOMAN |/|
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Gerd Altmann from Pixabay
icture a talented twenty-something engineer in Lyon or Łódź. She’s fluent in code and robotics, she wants to join a company that makes real things, and she would prefer to do it at home rather than in Austin, Seoul, or Bangalore. What stops her? It isn’t a lack of ambition or skills. It is the accumulation of frictions that make it harder to build in Europe than to dream in Europe: electricity that costs too much and arrives too slowly, rules that read like defensive fortifications rather than invitations, capital that prefers real estate to machinery.
That accumulation of frictions is what our Growth Commission calls anti-competitive market distortions—ACMDs. The name is technical; the reality is not. If you’re a homeowner, an ACMD is the reason your electricity bill spikes while your salary doesn’t. If you run a mid-sized firm, it is the extra quarter you add to a lead time because permits take too long and standards shift mid-project. If you’re young, it is the sense that the best opportunities sit a flight away. ACMDs are the quiet tax on trying.
Europe’s problem is not a shortage of ideas or of engineers. It is a shortage of permission. For three decades, we told ourselves that a high-cost, high-rule, high-centralisation model could be made compatible with fast growth so long as the world stayed calm and capital stayed cheap. That world is gone. The next growth story will belong to places that excel at the basics: abundant energy, flexible work, simple and stable rules, openness to trade and investment. The question is whether Europe chooses to be one of them.
What would it take to write that story here? Not a silver bullet, but a compact—between national governments, firms, and cities—that swaps insulation for competition, and rhetoric for measurable progress. It rests on five switches we can flip and a way to track whether we actually did.
Switch one: energy realism. Industrial civilisation runs on density, reliability, and price. For Europe to make things at scale, power must be affordable and available when the sun doesn’t shine and the wind doesn’t blow. Europe simply cannot afford its network of environmental restrictions and taxes imposed in pursuit of elusive Net Zero goals. Instead, we need to reduce these distortions and generate far more energy in all its forms, especially baseload. France certainly has an advantage here on nuclear, but nuclear alone is not enough in today’s AI powered world.
Switch two: work unlocked. The purpose of labour law is to protect citizens, not immobilise them. What makes it hard to fire a worker, makes it hard to hire them. At a time when AI is taking jobs, the premium on being able to hire the best workers possible is very high. When it is risky to hire and costly to adjust, firms invest in software instead of people; when transitions are punishing, workers cling to positions rather than pursue better matches. Countries that converted protection of posts into protection of people—through portable benefits, learning accounts, and simple hiring and separation rules—raised participation and pulled the inactive into work. Do that at scale, and wages rise with productivity rather than through decrees that price out the least experienced.
Switch three: a regulatory reset. The original European single market in goods was based on mutual recognition—compete on performance, not paperwork. Over time, it has drifted into regulatory harmonisation and a compliance culture that rewards size and punishes entry. A reset begins with a presumption of openness: unless there is a compelling risk to safety or honesty, the default should be to let firms test, sell, and compete. Give every major regulation a sunset unless renewed, require impact reviews that count competitive effects, and publish the cost of delay alongside the cost of action.
Switch four: an outward-facing market strategy. In a weaponised world, it is tempting to turn inward. That reaction is understandable—and self-defeating. Europe’s prosperity depends on selling to the world and learning from it. Our trade policy should do fewer grand designs and more practical bridge-building: mutual recognition and equivalence with trusted partners, open services with data-trust frameworks, and a relentless attack on non-tariff barriers that lock our firms out of growth markets.
Switch five: subsidiarity for grown-ups. Many of Europe’s best reforms do not happen in national capitals; they are invented by cities and regions that own their problems. We need to make that competition explicit. Give mayors and regional councils room to try new combinations—planning rules that make housing buildable, transport that cuts commute times, vocational programmes that match local employers, procurement that pays for outcomes. The U.S.’s laboratory of fifty states has helped it reach growth-promoting outcomes. The EU should allow member states and subnational entities to compete in the same way.
Finance the buildout. None of the above happens at speed unless Europe rewires how it funds investment. We are not short of savings; we are short of channels that turn those savings into equity for firms that want to grow. Too much household wealth sits in bank deposits, life-insurance wrappers, and property; too little flows to productive risk. The fix is practical: full expensing for new capital for a defined period; simpler, lighter prospectuses for small public listings; pension rules that let long-term money hold long-term assets; and tax treatment that stops punishing equity relative to debt. A genuine single market for risk capital—with passports that actually work—would do more for Europe’s start-ups and scale-ups than a decade of slogans. Pair that with faster approvals for industrial zones with ready-to-build power and water, and watch private capital move.
These five switches change the weather. But compacts fail when they become talking points. So we should agree to measure the right things and publish the scoreboard. That is what our ACMD approach is for. Instead of arguing about ideologies, we track distortions that suppress competition and show their cost in living standards. You do not need to buy the technical machinery to see the common sense: reduce distortions in energy, domestic competition, international openness, and property rights, and economies deliver more.
Europe has strengths: nuclear engineering; deep scientific networks; a fabric of small and mid-sized manufacturers; patient savings that could finance long-term investment if we gave savers a fair return; and a civilisation that values craft, quality, and local pride. None of what we are suggesting requires any of that to be altered.
There are objections to this agenda, and they deserve answers. Some say that pushing for competition will erode social protections. The truth is the opposite: you cannot defend a generous social model on a stagnant tax base. Growth is not a rival to solidarity; it is its precondition. Others argue that climate requires a planned economy. That confuses ends with means. It is economic growth that has led to better environmental outcomes around the world. Trying to pick technologies from the centre multiplies costs and delays the transition. A final objection is that Europe’s demographics doom us to slow growth. Demography matters, but participation, skills, and capital deepening matter more. Places that draw the inactive into work and invest in tools that raise productivity can grow even with flat populations.
Politics raises a final worry: can any of this be done without a bruising culture war? Yes—if we restore the distinction between goals we share and instruments we can argue about. Citizens want three basic things from economic policy: a fair shot at a good job; prices that don’t punish them for heating, moving, and eating; and public services that work. The compact speaks to those demands directly. Judge performance by connection times, business formation, take-home pay, and the cost and reliability of power.
What would an early-action plan look like? Within twelve months, governments could clear the queue of energy and grid investments with one-stop permitting and national targets for approvals; legislate full expensing for new private-sector investment for a time-limited window; cut employer charges on lower wages to pull people into work; write an ‘outcomes not inputs’ test into major regulations and do full competition impact assessments; and launch mutual recognition talks with key partners in services and digital trade. Regions could pilot fast-track zoning for ready-to-build industrial sites with guaranteed utilities. Universities and employers could co-fund modular training that delivers job-ready skills in months, not years.
If we do this well, Europe will feel different within a political cycle. Not because GDP statistics will sing instantly, but because people’s actual lives will change: a factory expands instead of deferring; an electrician starts a business and can hire two apprentices; a young engineer powers her robotics lab at a price that lets her compete; a family sees their energy bill stabilise and their commute shorten because housing was built closer to jobs. Growth stops being a debate on television and becomes the texture of everyday life.
It is easy to see the obstacles. It is also easy to underestimate Europe’s capacity to move when it decides to. We built a single market from a patchwork. We turned a continental grid into one of the world’s most reliable systems. We can now lead on a new standard: the easiest advanced economy in which to build. That title is up for grabs. Whoever wins it will not only grow faster; they will shape the technologies and business models the rest adopt.
The choice is not between Europe as a museum and Europe as cowboy capitalism it does not want. The real choice is between a politics of permission and a politics of possibility. The politics of permission makes every new thing climb an obstacle course designed for fear. The politics of possibility sets clear goals, rewards performance, and trusts citizens with more of their choices. The first path promises safety and delivers stagnation. The second accepts manageable risk and delivers renewal.
Our Commission will continue to measure distortions and publish the gains from removing them. But measurement is a means, not an end. The end is straightforward: energy that lets us build, work that pays, rules that welcome entrants, an outward stance that multiplies opportunity, and local freedoms that turn pride into projects. We know how to get there. What we require is not another round of slogans, but a compact among builders—public and private—who are ready to switch the system on.
Europe’s next growth story can be written at home. Let’s give our engineer a reason to stay.