It's not just about market valuations. That's just a proxy of overall productivity, where the US now has a 50% advantage over the EU.

First, the difference is much smaller: https://www.ecb.europa.eu/press/economic-bulletin/focus/2024...

And most "productivity" stats use GDP as a proxy for the productiveness of output, which is of course biased with the aforementioned overvaluation - the fact that in the US a burger costs $25 with tax and tips included, but 15 euros in France doesn't mean that a US server and cook are more productive.

And in any case, that is relevant in an EU to Soviet Union comparison how exactly?

The Soviet Union analogy is not a direct comparison. My point was narrower: excessive centralized control, even in a market system, can stifle economic dynamism, much like the Soviet model did in an extreme way. The EU’s heavy regulations (GDPR, DMA, labor laws) aren’t command economics, but they lean toward a similar logic of prioritizing control over freedom, with measurable results.

US stocks may be inflated but the gap — 241 US companies worth $30 trillion vs. 14 EU ones at $430 billion — reflects more than hype. It shows the US consistently produces globally dominant firms, a sign of higher productivity and innovation. The EU’s regulatory burden likely plays a role in why its startups rarely scale that big. For productivity, I cited the US economy being 50% larger (nominal GDP: ~$28T vs. ~$18T for the EU). Your ECB source doesn't contradict my point. It used a baseline of 2019 for both regions, to measure productivity growth, but the regions started at different baselines in 2019.

Anyway, getting back to my point: the US does a better job of creating new industries in large part because it avoids the EU’s regulatory morass and therefore has a more market-based economy.