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.Only those who expect great things ofthe future new customers and additional profits, for instanceare willing to invest in it.Thus, by taking a look at new invest-ment, we gain a better understanding of the factors leading toEurope s decline.For the first time since the Industrial Revolu-tion, there is no new passion to take the place of waning interestin old industries.The migration of capital from one sector to theTHE WAR FOR WEALTH 171next structural change has become a rare phenomenon inWestern Europe, partly evident in the fact that no significant newbusinesses have been added in at least 20 years.Corporations are merging, concentrating, and slimming downwherever they can.But the act of building business from scratchhas become a rarity, and only in exceptional cases do new compa-nies attain the size of their aging counterparts.The top 100 cor-porations in France, Great Britain, and Germany are almost allwell-known household names.Occasionally, when a successfulmerger has taken place, the name on the door and the composi-tion of executive boards are changed, allowing the media to con-vey the impression that what we are witnessing is evidence ofchange and revitalization.A look at the instrument panel of European economies con-firms the first, still fleeting impression of a noticeable drop in pres-sure in recent years.No new energy has been fed into the system.The net rate of investment, that is, the ratio of new acquisitionsto total economic strength, has declined by half since 1970.Thisis the first time since World War II that there has been so littleinvestment in new businesses.No one is willing to take theplunge, nor is anyone deriving any benefit from new business ven-tures.Europe s once-impressive economic history appears to havearrived at one of its final chapters.One problem is the continent s shrinking population, which,unlike the U.S.population, is not being boosted by immigration.Germany alone, Europe s largest economy, will lose about 10 mil-lion of its 82 million inhabitants in the next four decades.Thisdisappearance of people will also bring with it a loss of capital.A capital base that is shrinking in relative terms cannot serve asthe basis for growth and renewal.Other nations and continentswhere the capital base is growing in relative terms are quicklycatching up.Well-trained people and the investment capital nec-essary to put them to work are the propellant needed for eco-nomic revival.The street sweeper needs a broom, the fishermana rod, and the bartender a tap and bar, but automobile and aircraftdesigners and members of the biomedical professions are of a dif-172 GABOR STEINGARTferent caliber.They need large amounts of capital to be able to beproductive in the first place.Without this capital, the knowledgestored in their brains simply goes to waste.Without a laboratoryand a computer network, members of the biomedical professionsare even less valuable on the labor market than bartenders,because they lack the experience to tap beer and mix drinks.There is a significant difference between the United States andOld Europe when it comes to the balance of investment.Indus-trial production may be steadily departing from Europe s shores,but capital has already said its goodbyes.Structural changeremains intact, but investors have moved on to American softwaredevelopers and the giants of the financial and pharmaceuticalindustries.Within the last decade alone, the United States hasseen a number of new companies eBay, Lucent Technologies,Biogen, Google, Yahoo!, and Apple emerge and quickly developinto major players.They have managed to dominate the marketsjust as pioneering American industries like Standard Oil and Fordled by industrialists John D.Rockefeller and Henry Ford oncedid.The rate of investment in America has increased rather thandecreased.Investors mistrust Europe, despite its considerableefforts to attract investment.Conversely, investors love America,despite its problems.The United States is still the world leaderwhen it comes to attracting major investment.But the new thing is, Southeast Asia is quickly catching up.Thenew players are surprising the world with their ability to attractforeign direct investment, which began at a strong pace and is onlygetting stronger [ Pobierz całość w formacie PDF ]