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The German economic strategy of the last several decades has been to gain export market share through wage dumping.

How can that be? Prior to the Euro, the value of the DM has increased about fourfold in relation to the Pound. In other words, British labor has become cheaper and German labor has become more expensive. Even with the Euro, the Pound has lost more than 20% in the last couple of years, yet the UK has a record trade deficit.
If you devalue it means that you are not competitive. To compete on price these days (wage dumping) you would have to lower wages to Third World levels. The only way to maintain a high standard of living is by innovation.
With or without the EZone, the issue for Germany is not competition with Greece, the issue is competition with Japan, Korea and China.
by The European on Sat Mar 9th, 2013 at 06:08:20 PM EST
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