To the voices questioning the wisdom of a consumer led boom I would add the concerns Jerome has articulated about a coming oil shock. This is perhaps not the time to be increasing debt levels in society.
On the other hand, it's worth considering that the ECB is holding inflation too low for Germany and this is stalling the recovery. It's one thing to live within your means, but a little bit of inflation can be a good thing after a downturn. The economy is partly a psychological thing after all.
A great post, (of course my time living in Germany was so good that I'm biased) but I really believe that reunification is always an underestimated factor when people promote the US style economy as a model.
As was covered in an earlier thread, the most important demographic process in East Germany was a massive migration to West Germany (plus a dramatic fall in childbirths). More exactly: while one fifth of all people, mostly young people, moved West (3.3 million), half as many moved from the West to the East (1.75 million), but most of those were seniors. Thus, tough the expected age of people in Eastern Germany is lower, the population is still older.
Now, elsewhere I repeatedly made the argument that the age structure doesn't really matter to the economy (what you 'win' in the reduction of retirement fund budgets, you 'lose' in jobless benefit budgets and childraising costs).
However, in this case, the off-migration was a massive brain-drain of the, eh, 'best and the brightest', who'd be required for the envisioned capitalist paradise as entrepreneurs or skilled workers. Also, while I don't think much of arguments with the 'lower productivity' of old people, what is certainly a factor here is old people's difficulty to learn and adapt to a capitalist 'worker market' after having lived all their life in, ah, 'real existing socialism'. *Lunatic*, n. One whose delusions are out of fashion.
Originally, it is not so much different from that of Eastern Germany. Therefore, if you look at Germany as a whole, reunification did not have a big effect. But, as DoDo said, post-reunification migration changed the demographic structure in different regions.
But the decisive problem is a different one: In the east, there are several Millions of pensioners who never payed into the national retirement security system, but still have to be payed from its funds. That is what you have to keep in mind when you compare German with the US economy.
