In the March 2010 Harper’s, in an article titled, “Consider the Germans”, Thomas Geoghehan praises the German system (I’d post a link but it isn’t free). He says:
And then he endeavors to explain why the Germans are doing so well:
He goes on to summarize what he thinks makes their system tick by identifying three ‘building blocks’ of German social democracy: the works council, the co-determined board, and the wage-setting institutions.
On the works council:
On the co-determined board:
On wage-setting institutions (In not so many words, the description is only an idealization- reality is not so simple):
He makes some comparisons with the American system:
And concludes by promoting the adoption of the German model in America, accompanied by lines like this:
The article is persuasive, but I would like to see what 'dopers think of all this. Is he getting to the heart of the cause of Germany’s success, or does it rest on something other than their social democratic system? Does he paint too rosy a picture of the German economy? Most importantly, is he correct that the results identify the German model as “a better form of capitalism”?
Reads like lefty porn to me. “German companies will lead the next industrial revolution, the “green” one, while we in the United States will merely watch.” Is this guy serious? It’s like Mike Moore’s masturbation material.
If you were old enough you would remember the 90s, and the days f the Asian Tiger economies, and all the articles about why they were performing so well compared to the US and how we should emulate them. And oddly enough, most of the things we needed to do to emulate them were exactly the opposite of what we need to do to emulate Germany. Go figure.
In this world economies rise and fall, at any given point in time some economies are rising and some are falling for various and complicated reasons. History tells us that attempting to understand why the leaders are leading is impossible. Attempting to follow the current leaders by massive social engineering is just silly, given that we have no idea what factors are really responsible for their success.
Even if we could be absolutely certain of those factors, all you are going to do is keep your country in state of permanent upheaval. You would have had the children of the late 80s and 90s educated as Asian children, you would have based your economy and labour relations on the Asian model, and then 10 years ago you would have scrapped it and started basing it in the model of Australia or some other country that was performing well. And then today, ten years later, you are going to re-arrange it all again in favour of a German model.
The idea that the US should follow any other model is silly. You can’t strip out bits of the German or Korean or Australian model and patch them onto the US, it won’t work because the rest of the social and legislative structure isn’t there. And you sure can’t re-arrange the entire legal and social framework of the US to make them work.
But an even more pertinent question is “How long will Germany sustain this?” So Germany has done well for 6 years. The “Asian Tigers” did well for at last 10. They still collapsed in a heap and are now sinking deeper into the mire each day. Meanwhile the US has remained in the top 3 for, what, 60 years?
Do you really think it’s logical to say that something in the US has to be changed, given that track record?
I think it’s a question of culture. Europe has a culture of cooperation - the US of individualism. Both has it’s good and bad sides. And it’s not at all a new thing. WWII had a much larger impact on European countries than on the US. In the post-war years it was all about “all working together to overcome our problems” and so on, and the mentality stuck.
Europe has had close to the same growth in GDP as the US over the last 50 years. Slightly lower - but a European will just shake his head at you if you say “It can’t possibly be sustained”. There is nothing that indicates it.
Rigid employment regulation means that companies hesitate to employ new workers, and the result is higher sustained unemployment, but less effects in a downturn.
The cooperative attitude means a certain averseness to risk-taking - but also here it’s only to a minor degree.
On average, less resources is spent on R&D in Europe than in the US - but some industries have learned their lesson, and there are some indications that this is changing for the better.
And the culture of cooperation does certainly not stop those who wish to work hard to get rich . Statistics of class-mobility (where someone manages to earn a lot more than their parents) are as good or better than in the US, mostly because of the poorest in the US dragging the averages down.
It’s a balance - everywhere in the world. The question of security versus opportunities is not either/or.
I think Germany has seen the results of blindly following right wing ideology. In the US we are just starting to see it. Maybe after the next two or three times the economy tanks under the conservatives we’ll start to see a pattern. Hopefully before we invade Poland.
Germany is a model for the way they’ve managed to maintain a profitable manufacturing base. They export more than the United States. It’s the difference between arrogantly believing you’re going to be the managers and consultants for the entire world (so we might as well let manufacturing jobs disappear to the areas of lower labor costs, because shareholder profits are the top priority), and recognizing the virtue of an economy that provides a productive outlet for the common worker.
What worries me is that we have already lost some of the industries that you think would be difficult for other countries to pursue; e.g., paying the freight for shipping us steel and cars. Next we exported knowledge-based jobs like reading CAT scans and MRIs which can be done more cheaply in India. Boy are those Wall Street guys going to be in for a surprise when they find out that you can move money around anywhere. There are millions of bright college grads in India and China that would be happy to do that for a fraction of what Wall Street pays.
One thing that hasn’t been mentioned…the Germans have pretty much given up trying to compete with Asia. Volkswagen doesn’t make cheap econobox cars any more-the lowest priced german made car is over $25,000. The same extends to consumer electronics and clothing/shoes…only on the high end do you find german made products.
Generally, german made stuff is of higher quality than the crap we import from places like China-you will easily pay $150.00 for a pair of german made shoes…but they will last for years.
That said, Germany is a much more conformist culture than the USA-people accept a high degree of government control, and German law is concerned with the good of society. They don’t worry about all the stuff we do here-very few prosecutions for prostitution/soliciting, ans lower rates of drug use(than the USA).
Yes, and Germany, over and above that, has an obedience culture. The very idea of authority is respected, whereas in many other places (even in Europe), it’s resented. This makes planning and cooperation not just more practical and achievable, but a fundamental part of life.
We’re just about 180°from that here in the US. The only authority we really respect is that of the financially powerful, and then often because we see no way around it.
I’m not at all disputing that german cars are generally well made, but a Volkswagen Jetta S is advertised by VW for under $18,000 (so I’d expect the current dealer price to be a lot less than that, given the current economic climate). Sure it’s probably smaller than the generic US built car, but in European terms, it still looks like a fairly large sedan.
It is, more or less. Also a plea for social democracy on propagandistic grounds. International financial success is not perfectly correlative with domestic economic “justice.” (Although a broad spread of wealth can nourish a large engine of consumption, so there may be some correlation.) Adopting the German model would be good for the average American voter, but not necessarily particularly good for the average American captain of industry or professional politician.
OTOH, this paragraph is just silly, essentially throwing up hands & saying, “We can’t know anything, so let’s not even try anything!”
Volkswagen does make cheap cars, in Europe. They just use different branding for their cheaper models, such as SEAT and Skoda. They also use more upmarket brands for more expensive models, such as Audi. But they’re all products of the same company. In no way have they “given up trying to compete”. And no, they don’t charge $25,000 for their cheapest model. Remember to include sales tax in any cross-atlantic comparions.
I don’t know if that type of system would work well here. Not because I necessarily think the upper echelons of the companies would be the issue, but rather the rank & file.
In my experience at least, the folks who would make up the “Works Council” at places I’ve worked were real dipshits- generally speaking, they were bread & circuses types who ignorantly wouldn’t have hesitated to screw “the company” for their own short-term benefit. They were the same types who stole anything dinky that wasn’t nailed down on the logic that “a few pencils won’t make any difference to a big company like ours, but I don’t have the cash to buy pencils for my kids’ school supplies”
They were too ignorant to realize that if ALL employees had that attitude, then a few pens would indeed hurt the company, a lot.
The other thing that would keep it from working here is the ingrained management attitude toward hourly workers - many places treat them rather child-like, in the sense of how strict they are on breaks, coming and going times, etc… real draconian, almost irrational stuff. Giving them a say on a “works council” would mean that they’d have to give up control to them in some part, and with the attitudes I’ve seen, that sounds like a bad idea.
I’m not sure whether idiotic workers or over controlling management came first, but right now, that sort of German system would be pretty disastrous here, I think
Kind of turns it into a chicken-and-egg question though, doesn’t it? Are American workers a bunch of bread-and-circus dipshits precisely because their employment situation is patronizing, draconian, and without the opportunity of any kind of ownership whatsoever; or does American management have to act the way it does because workers here are dipshits from the word ‘go’?
Either way, it sounds like you are regarding the Germans as generally smarter. Is that right?
I don’t think Blake’s point is that nobody should do anything, so much as it’s that there’s no point trying to turn the USA into Germany. The American economy needs to be grown based on American circumstances.
I don’t think the comparison with the Asian Tigers is apt. For one thing,
Neither the United States nor Germany are considered developing countries, so whether or not people suggested emulating the Asian Tigers or not it wasn’t the right fit. Consider this:
Giving the Asian Tigers’ medicine to America would be akin to giving quinine to a syphilitic. Even the teabaggers aren’t screaming about disgruntled agricultural workers or land reform, at least last I checked.
Of course ‘socialistic’ ideas, even if they only amount to better organized labor, are problematic for a lot of Americans to wrap their heads around too. But America and Germany’s economies have more in common than America and the Asian Tigers’.
The Asian Tigers were also distinguished by a lot of government involvement in setting industrial policy, specifically in subsidizing favored industries. I don’t think the U.S. should be going that far.