The reason American median wealth lags behind Europe’s isn’t European socialism — it’s that Americans pay out of pocket for things Europeans get as public goods, then call the debt a sign of strength. In The Illusion of European Prosperity, John Gustavsson at National Review argues that the UBS Global Wealth Report’s median-wealth figures are misleading — that America’s lower ranking reflects demographics, risk appetite, and stronger growth, not inequality or systemic failure. The American system, he says, is the real winner, and the European model is an illusion.
He’s right about one thing: age matters. Older Europeans have had more years to accumulate assets, and the age gap between the U.S. and countries like Italy and Spain is real. The median-wealth ranking is influenced by demographics. He’s also right that American real wages have grown faster than European ones since 2008. The UBS report’s ranking is shaped by these facts.
But here’s the part the piece skips over. Gustavsson spends three paragraphs on debt — American medical debt, American student debt, American consumer debt — and then explains it as a behavioral quirk. Americans are “less risk-averse.” They take on debt because they’re “more confident in the future of their cash flows.” The debt is a sign of strength, not weakness. The debt, in other words, is the economy working.
That’s the tell. The debt isn’t a quirk of American psychology. It’s the cost of the system Gustavsson is defending.
Some debt builds wealth. A mortgage puts a roof over your head and creates an asset. A business loan funds something that earns. But the debt that drags Americans down in the UBS ranking isn’t that kind. It’s medical bills, tuition loans, credit-card balances run up to cover what a public system would have handled.
Americans don’t carry medical debt because they’re less risk-averse. They carry medical debt because the American healthcare system doesn’t provide universal coverage. The average worker with employer coverage now faces over $1,700 in out-of-pocket costs before the insurance kicks in — and according to Milliman, the total cost of healthcare for a family of four on an employer plan has passed $32,000 a year. For the family whose employer doesn’t offer coverage at all — the one whose neighbor in Denmark wouldn’t have to worry about it — a single hospital stay averages around $30,000. That’s not a sign of confidence. That’s a cost that shows up on the balance sheet.
Student debt is the same story. In Denmark, students graduate without tuition debt — tuition is free for Danish and EU students, and the government pays students a monthly grant to cover living costs. In Germany and Norway, tuition-free public universities are the norm. The American student isn’t “less risk-averse” — he’s paying for a public good that the European student gets as a tax-funded service. The debt is the price tag on the “low-tax, free-market system” Gustavsson celebrates.
And the “real wage growth” he cites doesn’t tell the whole story. He’s right that American real wages have grown faster than European ones since 2008. But real wages don’t account for what the wages have to cover. A family healthcare plan that costs $32,000 a year, student-loan payments that start the day you graduate, and childcare that eats a third of a median household’s income — add those up, and the “real wage” increase barely keeps pace with the bills it’s supposed to pay. The metric is partial, and Gustavsson is using it to tell a story about American prosperity while ignoring the costs the wages have to cover.
The European worker’s real wage may have grown less. But the European worker doesn’t pay thousands a year in medical premiums, doesn’t carry tens of thousands in student debt, and doesn’t spend a third of her income on childcare. The European worker’s take-home pay goes further because the European system takes more in taxes and then provides the things that Americans have to buy on the open market — at prices that are, thanks to the “free-market system,” among the highest in the world.
The “tech sector” argument is even thinner. Gustavsson says America’s inequality is what makes the tech sector possible, and that the boom has enriched “perfectly ordinary Americans willing to educate themselves and work hard.” That’s true — for the ones who got in. But the median American isn’t a tech worker. The median American is a 45-year-old who works in retail, healthcare, or food service, whose real wage hasn’t kept pace with the cost of housing in the city where the tech boom is happening, and whose kids go to a public school funded by local property taxes tied to the median household’s ability to pay.
The American system rewards the people who are already positioned to benefit from it, and calls the rest “less risk-averse.”
Now let me build the alternative, because that’s the part the piece doesn’t do.
What if the American medical debt were unnecessary? We already know how to do this — Medicare provides single-payer healthcare to everyone over 65, and it’s the most popular government program in the country. The 2021 expanded Child Tax Credit cut child poverty by 46% in a single year — from 9.7% to 5.2%, lifting 2.9 million children out of poverty. When the expansion lapsed, child poverty bounced right back. That’s not theory. That’s a controlled experiment the country ran on itself.
What if the student debt were unnecessary? The Nordic countries provide free university education as a public good. So does Germany. So does France. The American student isn’t less risk-averse — he’s paying for something that other countries already figured out how to fund collectively.
What if the childcare costs were unnecessary? A year of infant care in the U.S. runs $12,000 to $15,000. In Denmark, the state caps what parents pay at a fraction of the actual cost — a few hundred dollars a month. The impossible triangle — cheap for parents, decent for workers, profitable for owners — can’t be closed without public subsidy. Every other rich country subsidizes childcare. We could, too.
The piece argues that America’s low-tax, free-market system is the recipe for success. But the recipe includes a hidden ingredient: the cost that Americans pay for things Europeans get as public goods. That cost shows up as medical debt, student debt, and childcare costs. It reduces median wealth. It makes Americans poorer. And it’s not a behavioral quirk — it’s the system.
The UBS report isn’t an illusion. It’s a mirror. We already know how to build the alternative. We just haven’t done it yet.