Why Germany Still Has So Many Middle-Class Manufacturing Jobs

Post by justincormack » Sun, May 28, 2017, 4:34 PM UTC

pm90 wrote: post #15

crdoconnor wrote: post #6

He missed the main reason: currency suppression. Germany has managed to suppress the value of its currency over the years to make its exports artificially cheap, which encouraged growth, creating manufacturing jobs. It did this firstly through reunification (dragging down the value of the DM) and subsequently by joining the Euro (Southern Europe had the value of their currencies pegged higher than their 'natural' val…

I don't understand why this comment is being down voted. While "currency suppression/ currency manipulation" is usually spoken about in association with fraud, this is most certainly one of the reasons that has allowed German manufacturing to remain competitive despite having higher labor costs. Excellent comment. e.g. see this article on Politico which basically says the same thing: http://www.politico.com/agenda/st…

Post by RobertoG » Sun, May 28, 2017, 4:36 PM UTC

JanSt wrote: post #28

RobertoG wrote: post #14

Earlier quoted context omitted.

Not sure why you are down-voted. It's obvious that this is part of the trick and many economist have pointed it. It works the other way too, the currency of other countries in the Eurozone is above what it would be without Germany, and all that without a fiscal stabilizer between the countries, like it do happens in the United States between different states. It's a recipe for disaster if the goal is an united Europe…

He is right in some way, but he also misses that german workers had to take a lot of cuts in pay, benefits and working conditions. While french workers only have a 35 hours work week and greece workers get to enjoy a long pension, germans work till 67 (soon 69) getting a lower pension (as percentage of pay) and mostly work 40 hours (for full time workers. Statistics are heavily skewed by (mostly) female part time wor…

Post by crdoconnor » Sun, May 28, 2017, 4:38 PM UTC

pluma wrote: post #42

pm90 wrote: post #15

Earlier quoted context omitted.

I don't understand why this comment is being down voted. While "currency suppression/ currency manipulation" is usually spoken about in association with fraud, this is most certainly one of the reasons that has allowed German manufacturing to remain competitive despite having higher labor costs. Excellent comment. e.g. see this article on Politico which basically says the same thing: http://www.politico.com/agenda/st…

I think the reason this is downvoted is that the situation in Germany is relatively unchanged since before the Euro was introduced. Saying German success is mostly based on the Euro is a great narrative but completely ignores the reality that Germany's economy was already strong and getting stronger in the decades before that. That's not saying Germany doesn't benefit from the Euro today or that it wouldn't be profou…

Post by mtgx » Sun, May 28, 2017, 4:39 PM UTC

pm90 wrote: post #19

buro9 wrote: post #11

Wow, that's a pretty appalling article. Seems to avoid even mentioning the desire of most of Europe to try and learn from what went wrong after the Great War. In 1918-1930 Germany was left so weakened by peace treaties that the seeds were sown for WW2. Post-WW2 the allies felt that a Germany crippled would only bring future wars, and a huge co-ordinated effort to build a sustainable industry and economic growth was p…

I wonder how/whether increasing the defense budget would help the German economy. Let me just say right away, that I am in no way advocating for increasing the supply of arms and ammunition in the world, which already seems to be at dangerous levels. However, if Germany invested as much in military R&D and a domestic arms industry, I wonder if that would boost the economy as it has done in the US. Also, the immigrati…

Post by stale2002 » Sun, May 28, 2017, 4:41 PM UTC

pm90 wrote: post #19

buro9 wrote: post #11

Wow, that's a pretty appalling article. Seems to avoid even mentioning the desire of most of Europe to try and learn from what went wrong after the Great War. In 1918-1930 Germany was left so weakened by peace treaties that the seeds were sown for WW2. Post-WW2 the allies felt that a Germany crippled would only bring future wars, and a huge co-ordinated effort to build a sustainable industry and economic growth was p…

I wonder how/whether increasing the defense budget would help the German economy. Let me just say right away, that I am in no way advocating for increasing the supply of arms and ammunition in the world, which already seems to be at dangerous levels. However, if Germany invested as much in military R&D and a domestic arms industry, I wonder if that would boost the economy as it has done in the US. Also, the immigrati…