Since the beginning of the global economic slowdown, unemployment in Spain has shot up to 17%. The Spanish government could do well to look to Germany, argues El País, where the jobless total is less dramatic.

This is the latest miracle: Germany's economic downslide has been steeper than any other big country in the EU - and yet Germany is not shedding any jobs. As a matter of fact, in the first quarter of 2009, German GDP plunged 6.9% on the same period last year, more than double the drop in Spain (-3%) (according to Eurostat). But from April 2008 to April 2009, German unemployment only inched up from 7.4% of the active population to 7.7%, while nearly doubling in Spain from 10% to 18.1%.

This German miracle admits of various explanations, two of which are the most compelling. One is flexibility: the ability to scale back working hours at companies with shortfalls in incoming orders. 1.5 million workers have now opted for State-supported Kurzarbeit, cutting their workday by a third on average, which has presumably saved almost half a million equivalent full-time jobs. The other is the temporary suspension of employment, putting jobs "on ice", as it were: whilst the company pays 10% of their wages, the State foots by and large the rest of the bill, and employees remain on the payroll - with no other duties than to make the most of their leisure time to retrain and recuperate. It is a sort of Spanish ERE (expediente de regulación de empleo) downsizing plan, but suppler and with far less red tape than in Spain, where it's hard to get the plans approved. The layoffs here in Spain are hardly affecting permanent staff at all: two thirds of the jobs shed last year were temporary positions.

Recently, Germany became the last European Union country to make public a list of those companies and individuals receiving EU agricultural subsidies. Many were surprised to see Haribo, the gummy bear maker, on the list. 

At Haribo factories in 18 different locations in Europe, including the one in Bonn, Germany, glucose syrup, sugar and fruit flavoring are transformed into chewy frogs, juicy berries, and the classic Haribo gummy bears.

The recipe is a secret, but a representative company admitted that they do use a lot of sugar, the second ingredient in their gummy sweets.

Recently, trucks were coming and going from the Haribo factory in Bonn, bringing ingredients in and sending finished gummies out into the world. One of the trucks making a delivery is from Koelner Zucker, a sugar company based in Cologne, just north of Bonn.

The majority of the sugar Haribo uses comes from Europe. To keep cheap, non-EU sugar from flooding the European market and putting European sugar producers out of business, the EU sets sugar prices and taxes sugar imports. That makes EU sugar more expensive than sugar bought on the world market.

France's budget deficit will exceed 7 percent of its GDP in both 2009 and 2010, the country's Budget Minister, Eric Woerth, said on Sunday (21 June).

The announcement highlights the heavy toll being extracted on public finances by the government's stimulus plan and falling tax receipts, with the latest figure a considerable increase on a previous March forecast for a 5.6 percent deficit this year.

France's economy is set to grow again next year but the government's stimulus plan has added to a rising budget deficit

"This deficit is both the cost of the crisis and the price of recovery," said Mr Woerth on French television.

The budget deficit is likely to reach €115 billion this year, plus an additional €20 billion in social security deficit. At the same time, Mr Woerth predicts corporate tax receipts in 2009 will likely be less than half the €50 billion taken in a normal year.

The World Bank today poured cold water on the chances of a robust recovery for the global economy next year, warning instead that the weakness of banks and rising unemployment will cast heavy shadows in 2010.

Although acknowledging that major economies are no longer in free fall, the World Bank is far more cautious than the International Monetary Fund about the strength of a recovery.  

The Bank explained its caution comes "partly because this downturn follows a financial crisis - which tends to be deeper and longer-lasting than normal ones - and partly because today's downturn has affected virtually the entire world."

June 22, 2009 "Counterpunch" -- In reaching across the aisle for Republican support - and no doubt future campaign contributions from the financial sector Pres. Obama is morphing into Joe Lieberman. There also is a touch of Boris Yeltsin in his sponsorship of a financial "reform" ominously similar to what advisor Larry Summers backed in Russia - relinquishing government power to a banking elite. The Financial Regulatory Reform proposal promotes Wall Street's "product," debt creation, at the expense of the economy at large, and lets financial chieftains continue to self-regulate the debt industry - and to keep scot-free all their gains from the past decade's worth of fraudulent lending.

Confronting the wreckage of a debt crisis worse than any since the Great Depression, Mr. Obama has achieved what no Republican could have: rescuing the Bush Administration's pro-creditor policies that fostered the Bubble Economy in the first place. "Most of the financial sector lobby community is happy with what has emerged," the Financial Times summarized. A spokesman for the Financial Services Forum, a major Wall Street lobbying organization, called the proposals "careful and balanced."1/ With such endorsements, victims of predatory lending have good reason to worry. The Obama plan is just the opposite from reforming the financial system along lines that progressive Democrats and other critics have urged.

The plan's six most fatal flaws are apparent in its preamble, which lays out a false diagnosis of the financial problem in a way that whitewashes Wall Street (in contrast to Mr. Obama's nice televised populist speech giving verbal criticism to "culture of irresponsibility"). A false diagnosis must lead to wrong-headed cures - rarely by accident. There invariably is a financial beneficiary who gains from blind spots in a legal "reform" package.