In the 90s, German businesses woke up to the fact that they had the equivalent a "little India" at their back door, i.e. countries with a motivated workforce - many of whom spoke German - willing to work for cheap (except that this workforce had a higher proportion of skilled industrial trades).

Consequently, throughout the 90s German industrial companies - both large majors and SMEs - transferred a lot of their manufacturing east.

This has contributed greatly not only to stagnant incomes but to a general atmosphere of insecurity.

The fact is that what we're experiencing right now is a top-down disaster. -Paul Krugman