Europe Is Falling Behind; Complaining about globalization is as pointless as trying to turn back the tide. Asian competition can't be shut out; it can only be beaten. And now, by every relative measure of a modern economy, Europe is lagging.

Byline: Tony Blair (Blair is prime minister of the U.K.)

It was Canute, one of the first English kings, who is said to have demonstrated the limits of his powers by showing that the tide would not obey his orders. Hearing some of the debates on globalization, I sometimes feel Canute needs to get his feet wet again.

Complaining about globalization is as pointless as trying to turn back the tide. There are, I notice, no such debates in China. They are not worrying about potential threats but are busy seizing the opportunities in ways that are transforming their society and ours as well. So, too, are the other emerging economies in Asia and South America. I am proud that the United Kingdom's economy has grown twice as fast as Germany's and four times as fast as Japan's since 1997. I am, however, painfully aware that China has been growing three times as fast as the U. K.

Each of these fast-developing economic powerhouses has labor costs a fraction of those in Europe and North America. All can import technology and are working hard to develop their own. Foreign capital is flowing in to help them. We have to understand that competition can't be shut out. In the end, it can only be beaten.

As I told the Labour Party in September, the new world we now find ourselves inhabiting is indifferent to tradition and past reputations, unforgiving of frailty and ignorant of custom and practice. Success will go to those companies and countries which are swift to adapt, slow to complain, open and willing to change. The task of modern governments is to ensure that our countries can rise to this challenge.

We know, too, what has to be done. There is no secret recipe for economic success. The difficulty is getting all the right ingredients in place. Successful countries need a stable economic framework so firms, and families, can plan with confidence. They need open markets, strong encouragement of enterprise with labor-market flexibility to foster dynamism and adaptability. And, more important today than ever, they need sustained investment in science, education and lifelong learning to make the most of the skills and talents of all their people--to create, in fact, true knowledge economies.

We can already see how important education and skills are for individual and collective prosperity. At every level, those with good qualifications do better than those without. On a global scale, half the increase in the annual growth of productivity comes from new ideas and ways of doing things. The fastest-growing cities in America and Europe are those with the highest proportion of knowledge workers.