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I find this whole issue difficult in a number of dimensions:

1) The high moral tone attributed to Germany's export-led, trade surplus prosperity.
It seems in every reality-based economics framework to require some others to import and have a trade deficit - so it's not clear to me that there's an easy way to allocate moral superiority. As for budget borrowing - it's not so long since Germany bent the rules on the GSP...

2) I can understand ordinary Germans feeling hard done by - wage stagnation and even decreases have been their lot for a while... but at the same time it seems that corporate profits have not been so stagnant... so I wonder about the "competitiveness" tales being told. Bait and switch by the German plutocracy?

by Metatone (metatone [a|t] gmail (dot) com) on Tue Apr 13th, 2010 at 09:17:35 AM EST
I see Migeru is well ahead of me in making these and other important points.
by Metatone (metatone [a|t] gmail (dot) com) on Tue Apr 13th, 2010 at 09:18:55 AM EST
[ Parent ]
Great minds think alike, or Groupthink™ Alert?

The brainless should not be in banking -- Willem Buiter
by Migeru (migeru at eurotrib dot com) on Tue Apr 13th, 2010 at 09:39:24 AM EST
[ Parent ]
Neither?
by afew (afew(a in a circle)eurotrib_dot_com) on Tue Apr 13th, 2010 at 10:07:08 AM EST
[ Parent ]
This is, I think, a very serious problem.

Many people in the PIGS (i.e. countries with trade deficits) understand that something has to be balanced.

People in countries with trade surpluses (like Germany) see to see themselves as superior.

Obviously some countries can only run structural deficits if others runs structural surpluses: it takes 2 to tango.

Correction has to come from BOTH sides. If one side think it is superior and has nothing to correct, then we have a attitude problem. More insidious, this superiority attitude coming from the Germans.

There is a foul stench of the 30s in the air, in many ways.

PS - I would not have any problem with a "superior" model if it was at least balanced (better than balanced: not very dependent on the exterior for fundamental things like erm... energy or food).

by t-------------- on Tue Apr 13th, 2010 at 05:03:05 PM EST
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We have the same problem with the China/US debate on the savings glut vs. the debt binge.

Also, there was a chance of a balanced international system wat Bretton Woods (namely, Keynes' International Clearing Union) but the US, being then the exporter of last resort, saw fit to take the same position of superiority.

The brainless should not be in banking -- Willem Buiter

by Migeru (migeru at eurotrib dot com) on Tue Apr 13th, 2010 at 05:08:42 PM EST
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