Monday, August 26, 2013

Encouraging Entrepreneurship in Europe.
One of the things that Europe lacks and is harming its economy is the lack of entrepreneurship across the continent. A stereotypical explanation for this is that Europeans are too ashamed of failure and too unwilling to takes risks to be successful entrepreneurs.  

Contrast this attitude with that of America, where anybody – as long as they’ve got a “can-do” attitude and enough elbow grease – can start a business in their garage and watch it grow it into a billion-dollar enterprise. (Debating Europe)

So why America is able to encourage its people to experiment and be bold when starting a new business from scratch, making the American market and economy more competitive than Europe's? What are we doing wrong in this side of the Atlantic?

Europe basically lacks two things. Firstly our governments, our political and financial system do not encourage or even allow entrepreneurs to flourish. In some countries it is very hard to start business and that is deliberate. Our political elites want to keep the established financial status quo and do not encourage new business to blossom. 

Taxation, red tape and over regulation are the means that are used to stop any young or new businessmen to start their own business and bring more competitiveness in their region. Also in many countries it is very hard to start a new business if you do not bribe the local authorities, or do not know any high ranked official in them. 

Europe is a very rigid and conservative continent and it is no wonder that it finds itself now-days in a crisis, that is not just an economic but also a political, social and cultural. The narrow mildness of the ruling elites, but also their power mongering, lack of vision and true leadership is the real problem, not the "laziness" of the ordinary citizens.

The other problem is concerning our education system, but also our mentality as peoples that are not very independent or innovation oriented. We are teaching our youth outdated modules in school in an outdated way, like religion for example. Modules such as this should not be made compulsory, or be taught in the traditional way in our classrooms. 

Instead we should introduce new modules that will enhance the ability of our youth to become real businessmen. Our education system should overall change and include new modules, that will teach our youths about new industries and how to become more innovative. Encourage them to experiment and take risks, not place austerity on them and force them to stay with their parents well in their 30s.

How can anyone in Europe be bold enough to become an entrepreneur if the risks are too high and there are no guarantees of recovery or support by the government?

Also the European population like to stick to what it knows. This originates in the post WW2 era, when an income and job security was very important for our survival. Generation upon generation grew up with this mentality and that has lead to the crisis we are facing now. The world has changed, but sadly we have not. 

Our predominant industries are fishing in the North, agriculture in the mainland, public sector in small peripheral states. The property, tourism and banking industries also flourish just because they offer a chance of easy and quick money, seasonal profits in some cases but without the ability of exports. 

The globalization process has forced our biggest industries to move in countries with cheaper workforce, thus leaving Europeans with fewer options in finding a new job. And how can there be innovation without an industrial background and the ability in finding a job, to support you during the first years of becoming an entrepreneur.

Our established business elites support and perpetuate this situation, because they have invested millions in developing these sectors and economic model. Introducing any new sectors would alter the financial make up of the country and shake up vested interests.

The austerity that Mrs Merkel and other European leaders have placed upon us, hits the young people worse and how do the European elites expect Europe to recover in the future, if the continent's youth is incapacitated and have their wings clipped in its more creative stage? 

They are making sure in that way, that the wealth remains in certain rich and powerful elites of certain rich and powerful nations forever in their hands, while forbidding any chance of change of this status. So the only way that Europe can find a way out of this crisis, is for its political and business elites to realize that it is either reform or doom at this stage. 

It is in their interests to have an active European population, that is engaged in innovation and entrepreneurship. The wealth that is going to be produced can fuel the transformation of the European economy and with an educated population we could overall become more competitive. 

The solution could happen on a pan-European level with the direct involvement of the EU and its institutions, but it is doubtful that the local authorities will cooperate and implement the new regulations fully. The problem is that seemingly there isn't any European politician with enough leadership and back-bone, to proceed with the necessary reforms.