This argument doesn't make sense to me. Better wellfare lowers the risk of working at a startup, which would make more people try it. I guess work regulations and employee rights are make things harder in Europe than in the US, though.

According to Inc., "Norway has more entrepreneurs per capita than the United States":

http://www.inc.com/magazine/20110201/in-norway-start-ups-say...

(Disclosure: I am indeed Norwegian.)

I think the more interesting question is how to create the next Google or Facebook outside the US.