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Mostly, deregulation of the labor market coupled with hefty benefits cuts to unemployment and health insurance and tax cuts for the rich. Here and here are useful Wikipedia articles (in English) that have the basic facts. The idea behind it all is to reduce the cost of labor, thereby making the German labor market more competitive in a global economy and thus creating more employment.

Now, please understand that I'm not saying these reforms are without merit. What I and many others found appalling was how Schroeder's government in the face of crisis turned around and did exactly what it had blasted their conservative predecessors for trying to do, without any attempt at damping the economic and psychological blow to the poor and unemployed and without any attempt at finding a "third way" between Keynsian (read, more or less, traditional social-democratic, comparable to the New Deal under FDR) and neoliberal policies.

If you can't convince them, confuse them. (Harry S. Truman)

by brainwave on Mon Sep 19th, 2005 at 09:59:20 PM EST
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How is it that the media in the UK, including the BBC, and even the Guardian, are allowed to parrot this line that Germany needs all these reforms and that it has become the new "Sick Man of Europe"?  It seems to me to be utter nonsense.

If I can quote from a friend who lives in Germany...

"The truth is, ever since reunification, German industrialists have whinged incessantly about how inflexible, pampered and downright lazy German workers are, particularly those in the east. They have urged them to do their patriotic duty and to be flexible, to lower their expectations and to damned well be grateful if someone deigns to give them a job in spite of all their obvious shortcomings.

In return, they have refused to invest in Germany, have shifted their production elsewhere, have whinged and bitched and extracted concession after concession, and then whinged and bitched that it still hasn't been enough.

Here's an example: every year we get the same story about farmers in Brandenburg being unable to find German workers to harvest asparagus, so they have to get people in from Poland, who are glad to do it. What they don't mention is that they pay about 3 Euros an hour. In Poland, the cost of living is a fraction of what it is in Germany, so you can't blame Polish workers for doing it. Equally, you can't blame Germans for not doing it. Nevertheless, every spring you hear the same story about what lazy bastards the Germans are.

All this "sick man of Europe" stuff is a con. Germany still exports more than any other country in Europe. The problem is that it is (or, increasingly, was) based on a system of "capitalism with a human face", for want of a better expression. And the bookies, con-men and bullshitters who run the Anglo-Saxon economies, as well as their would-be equivalents here, can't be having that.


Musings on life in Romania and beyond

by adhoc on Tue Sep 20th, 2005 at 04:20:59 AM EST
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