Post: #1

Why is it that labor unions are more effective in Germany? Why is infrastructure better off in Germany? Why is health care better in Germany?

In recession battle, Germany and China are winners

Why all this from a country that is much more Socialistic than the United States? Is Germany just less corrupt by nature? What is it about Germany?

Quote:Most Americans, I suspect, believe we’re losing manufacturing because we can’t compete against cheap Chinese labor. But Germany has remained a manufacturing giant notwithstanding the rise of East Asia, making high-end products with a workforce that is more unionized and better paid than ours. German exports came to $1.1 trillion in 2009 — roughly $125 billion more than we exported, though there are just 82 million Germans to our 310 million Americans. Germany’s yearly trade balance went from a deficit of $6 billion in 1998 to a surplus of $267 billion in 2008 — the same year the United States ran a trade deficit of $569 billion. Over those same 10 years, Germany’s annual growth rate per capita exceeded ours.
Germany has increased its edge in world-class manufacturing even as we have squandered ours because its model of capitalism is superior to our own. For one thing, its financial sector serves the larger economy, not just itself. The typical German company has a long-term relationship with a single bank — and for the smaller manufacturers that are the backbone of the German economy, those relationships are likely with one of Germany’s 431 savings banks, each of them a local institution with a municipally appointed board, that shun capital markets and invest their depositors’ savings in upgrading local enterprises. By American banking standards, the savings banks are incredibly dull. But they didn’t lose money in the financial panic of 2008 and have financed an industrial sector that makes ours look anemic by comparison.

http://benjamindavidsteele.wordpress.com...t-germany/

Post: #2

Try telling the next retiree you see socialism and therefore social security doesn't work and ask if they like your idea

Post: #3

(04-10-2013 03:06 PM)iknowexactly Wrote:  Try telling the next retiree you see socialism and therefore social security doesn't work and ask if they like your idea

The title probably came off as anti-socialist. I'm definitely not against socialism, but I wonder why a country like Germany is more effective.

Post: #4

The explanation I've seen suggested a lot is "multiculturalism" but I'm not sold.

Post: #5

It's complicated.

Post: #6

the system in germany is called social market economy. there are a lot of "socialist" mechanisms contributing positively to the capitalistic competitiveness of the country. the lack of a sovereign currency since 2000 enabled to expand the export surplus. germany is one of the few countries that had/has no minimum wage

Post: #7

Germany has remained competitive by bleeding out the small workers, wages have stagnated or even dropped for years while the big corporations make fortunes on exports due to the weak euro.
The German social system is not sustainable and will collapse in the next decades due to the demographic shift. It took a huge hit in 89 when Germany got reunited with the DDR and nowadays there are tons of immigrants leeching off of it. With the low birthrates and an aging population the country would need hundreds of thousands of immigrants every year to even sustain the population.

Post: #8

Because Germans are German and Americans are American.

Americans don't know what the fuck they want. Germans have a more clear sense of purpose and direction.

Most Americans just wander thru life aimlessly. Americans couldn't even define "socialism".

Post: #9

(04-10-2013 03:00 PM)kerouac Wrote:  Why is it that labor unions are more effective in Germany? Why is infrastructure better off in Germany? Why is health care better in Germany?

Why all this from a country that is much more Socialistic than the United States? Is Germany just less corrupt by nature? What is it about Germany?

So you are asking why can it be so successful but still very socialistic?

The article you quoted has some answers in it (banking system, etc). Other factors are, yes the homogenous makeup of society (i.e. people actually believe in the social system cause their neighbors are very similar to them.) Another reason could be culture. I've lived in Germany when I was a kid and from that experience and other I can tell you that Germans are generally conformist, hard-working, responsible, rule -abiding, etc people.

So yes Germany is less corrupt, it has a conformist, responsible work-force, it has large very well educated and trained technical workforce. Germany also has a history of technological competitive advantage (it was a chemical and industrial powerhouse already starting in the beginning of the 20th century and it remains so. Think of all the big name in industry: Siemens, BASF, Bayer, ThyssenKrupp, not to mention the best carmakers in the world. They have been around for over a century. The first highways in the world were built in Germany, in the 1930s.

I am not too familiar with the unions and their history in Germany, but one thing I know is that they have been around for a while and they have a good relationship with the management, which in turn has a good relationship with the financial system (Bankers, etc) so the whole system seems to work well. There is much less animosity and confrontation among the various stakeholders, unlike in the US for example.

Some countries are up and coming challengers to Germany's high tech industrial prowess, such as: South Korea, Japan, China, so it remains to be seen whether Germany can continue to have a competitive advantage.

---
Ok, before posting this I noticed a few more posts with valid points by w00t and void:

- yes the common currency that came in beginning of the 2000s had a lot to do with making Germany's exports very competitvely priced. (if Germany still had the Deutsch mark, their exports would have been much more expensive)

- low and / or minimum wages that are not as crazy uncompetitive as US carmakers used to be for example.

- not sure about the demographics but yes immigration puts downward pressure on wages

Post: #10

How do you measure labor union effectiveness?
Infrastructure probably has better funding in Germany. Healthcare is better in the US than in Germany.

Post: #11

Here's what so many people on the right fail to realize: we are already living in a sort of broken form of socialism. At least other countries are ok with calling a spade a spade.

Our country bails out failed companies, and uses the ER as it's socialist HMO.

There's no getting around socialism anymore. I say we take a good look in the mirror and publicly recognize it. Then we can clean things up, get rid of the graft/middlemen/leaches/racketeers/insurance companies/etc. and use our power more efficiently.

Post: #12

One of the major differences is that Germany has a two-tiered structure of corporate governance. In the U.S. corporations are governed by a single board of directors, the members of which are appointed by the shareholders to oversee the company's executive committee. The problem with this structure is that CEOs themselves are often on the board and have sway in determining who is appointed. This structure also allows for a small number of powerful investors to essentially control the company through holding blocs of preferred shares which usually hold outsized voting rights, sometimes even 10:1 with common shares.

In contrast, German corporate governance is divided into a two-tiered system, a supervisory board and a management board. The supervisory board is comprised half of representatives elected by shareholders, and half representatives elected by employees. The supervisory board then acts to oversee the management board, which is the executive committee in charge of the day to day operations of the firm.

The bolded part is the key distinction, in my opinion. Can you imagine how differently U.S. corporations would behave if half of their board of directors was appointed by the employees of the company? German corporations treat their employees much better than U.S. corporations, and the major reason why is simply because in Germany employees have a large say in corporate governance. In contrast, employees in the U.S. are seen as nothing but labor expense to be minimized so that executive bonuses can be increased.

Post: #13

(04-10-2013 04:22 PM)scorpion Wrote:  In contrast, German corporate governance is divided into a two-tiered system, a supervisory board and a management board. The supervisory board is comprised half of representatives elected by shareholders, and half representatives elected by employees.

@scorpion, thanks for bringing that up. I forgot about that point. It's important. Employees (union) and management are in the same boat and they are both responsible for supervising where the company is heading (at a board level).

In US, the employees are given simply stock options at some companies. They have a stake in the profits, but no say how the company is being run or governed.

On the flip side, I wonder how many German workers get profit sharing or stock options, etc?

Post: #14

I'm shocked at the ignorance of some Americans

Germany is social democratic. There is nowhere socialist in Europe.

The company benefits from strong unions, a good education system, a good housing system that controls rents, etc.

Businesses flourish and generate great wealth for the nation.

Free market capitalism/ Randism is a particularly insidious form if capitalism propagated by people like George Bush. It is one of many forms of capitalism, however it reminds me more if communism.

This is because its adherents believe the free market can solve all woes and that everythibg can be privatised.

Such people cannot accept it when governments successfully run industries or sectors. The Economist's hamster always spins like crazy trying to deny for example the success of national oil companies.

It is more of a religion than a rational viewpoint, and thankfully did not spread to Germany

Germany is very diverse nowadays, many people are of Turkish or Polish origin

Post: #15

In this thread, I will be testing my "Bro-Political-Science"

Americans don't like socialism because their grandpa told them it was bad.

And, they don't want to be associated with the hippies who protested for the "we are the 99%" thing.

My grandpa used to call them "Commie Bastards"

Post: #16

socialism doesn't work.

Post: #17

(04-10-2013 05:37 PM)NY Digital Wrote:  socialism doesn't work.

What a compelling argument, I agree!

Nonetheless it seems that the labour unions in Germany takes a much more pragmatic approach to things, and are much more reasonable when compared to American, Canadian and British unions. Of course this also has to do with the fact as stated above that labour is represented well in the corporate affairs of the company.

Post: #18

German system can work only in Germany because people are very smart there and their high IQs allow for a very high level of organization which is impossible in other countries.All parts of the machine work coordinated and harmonically bringing maximum result and effectivity impression.There are one million things which make Germany.
American system is one of indigenous optimism that everything is possible after education regardless of the people involved in it.Americans are not equal in any sense.There are huge differences in race,culture,education,income,personal abilities.Germans balance around a high average much more than Americans and this allows socialistic distribution of income without it looking unnatural.(so what if sb works 20% more and gets 20% less? if it is good for the balance of the system?).

Managers in Germany are usually former workers who know the practical aspects of the job very well,have respect from the other workers and get paid just 1.5 or double more than them while in USA they do not come from workers stock and get paid 100 times more.The difference in view of who actually gets the job done and needs to rewarded is clear.Germans take pride in their achievements as workers they do not regard them as obligatory,despised labor and do not react as herd but with personal individuality and responsibility.It is taken for granted there that you think and take intitiatives for quality improvement instead of applying strict fool proof guidelines.
This again is possible cause of the high intelligence and diligence of the German population.They are generally very accurate both in speech and hand movements.They act and think insanely fast.They are also natuarl managers and leaders.(no relation to passive Slavs or lazy Mediteraneans).Generally the Germans are hektisch they always want to do sth they never relax.

Post: #19

I've lived in Germany. Greek Kamaki is right

Post: #20

Germans are the ultimate pragmatists. As part of that when they ask for something everyone understands the need for it. There's less ideology and more of a, "OK it makes sense, let's do it". If it doesn't work, it's thrown out.

The other part is, most socialist policies have policy creep. They start giving a benefit, it then gets increased over the years and expanded to more groups. Eventually, the spending is out of control. First off, Germans don't ask for more than they need because everyone understands what's needed. 2nd, Germans are prideful people who believe in working to accomplish things. To just sit on your ass and collect checks would be shamed hard; unlike in the US and UK where they try harder and harder to remove the stigma.

Post: #21

(04-10-2013 05:49 PM)Greek kamaki Wrote:  German system can work only in Germany because people are very smart there and their high IQs allow for a very high level of organization which is impossible in other countries.
They are generally very accurate both in speech and hand movements.They act and think insanely fast.They are also natuarl managers and leaders.(no relation to passive Slavs or lazy Mediteraneans).Generally the Germans are hektisch they always want to do sth they never relax.

It is a damn shame they aren't procreating.

Post: #22

(04-10-2013 06:50 PM)Athlone McGinnis Wrote:  

(04-10-2013 05:49 PM)Greek kamaki Wrote:  German system can work only in Germany because people are very smart there and their high IQs allow for a very high level of organization which is impossible in other countries.
They are generally very accurate both in speech and hand movements.They act and think insanely fast.They are also natuarl managers and leaders.(no relation to passive Slavs or lazy Mediteraneans).Generally the Germans are hektisch they always want to do sth they never relax.

It is a damn shame they aren't procreating.

And breed ugly ass women? If Germans are so smart why did they lose two World Wars in 1 century? I think that's a world record.

And socialism is alive and well in America. They changed their name to Democrats.

Post: #23

It's a much smaller country. Much less people. And it's population is mostly homogenous (the same nationality/race). All these things make socialism much easier to run.

They're capitalist side of the system works very well, the best in Europe, actually. You can't have god Socialism without good capitalism. Socialism is the parasite.

German's have historically been the smartest and most industrial people in Europe. They pride themselves on their diligence and precision.

Post: #24

(04-10-2013 05:49 PM)Greek kamaki Wrote:  Managers in Germany are usually former workers who know the practical aspects of the job very well,have respect from the other workers and get paid just 1.5 or double more than them while in USA they do not come from workers stock and get paid 100 times more.

I think this is one of the most crucial and underdiscussed aspects of the system. A lot of research out there is suggesting that wealth inequality fucks up economies something fierce; it makes sense to me, for reasons I don't have the patience to list right now.

German courts will actually invalidate egregious executive pay packages. When Michael Ovitz left Disney after a year with $160MM in compensation, our courts shrugged and said the company had the right to pay it. German courts cited the decision as blasphemy and levelled criminal charges in similar cases.

Post: #25

America has Bill Gates. Germany doesn't.

American had Steve Jobs. Germany didn't...and never will.

America innovates amazing advances -- Germany advances the design and technology of things already created.

America pushes the envelope and its entrepreneurs take risks -- Germany stay inside the envelope.