Two U.S.-trained economists of Italian provenance take sharp aim at Europe's economic ills. They find Europe in inevitable decline, politically as well as economically -- unless there is strong action soon to correct Europe's course. They are critical of many of the now standard calls for reform, arguing that some of the proposals will be merely palliative and that others, such as the argument that more public funds should be directed toward universities and toward research and development, are positively misguided. The authors do not urge continental Europe to adopt "Anglo-Saxon" values, and they believe that the European welfare system, efficiently managed and financed, can be sustained. But they argue strongly that Europeans should pay more attention to the positive lessons that can be learned from the U.S. economy, particularly with respect to innovation and permitting unsuccessful firms to fail. Europe, in the authors' view, suffers from too little competition and from attitudes, shared by both politicians and the public, that can be successfully exploited by vested interests -- usually those who are better off than the average person -- in order to protect their positions.