by afew
Sat Feb 4th, 2012 at 09:03:50 AM EST
Media peddling of received wisdom likes to dwell on the Economy to Emulate du jour. Seeriouss People™ are reported or filmed saying they've crunched the numbers or just returned from a visit to such and such a place, and my word they're impressed. Journalists repeat the puffwords "successful, vibrant, surging, stellar, GDP growth, full employment..." In the 1980s, in the French media at least, it was Japan. Then Japan hit a rock and has since gone off the radar. In the Blair years, it was the UK England London. No more now. For long it was the "insolent good health" of the American economy, just when that economy was rotten to the core. Don't hear that any more. These days it's Germany.
So Nicolas Sarkozy went on six French TV channels last Sunday, with much pomp and obsequious journalists asking predetermined questions, to say he was going to make France imitate Germany. Raise VAT, reduce employers' payroll contributions, put an end to the 35-hour working week, weaken collective bargaining even more than in Germany with enterprise-by-enterprise renegotiation of hours and pay (more of one and less of the other). As usual with Sarko, it was smoke and mirrors, since he was announcing as decisions on his part measures that would be applied after the presidential elections... when he stands a good chance of being an ex-president, and the measures of not being applied. But, through the smoke, it's an image that he wants to project of the tough guy telling it like it is, and "like it is" is TINA - Germany is right, we have no choice but to copy the Germans.
If anyone wonders why any other eurozone country, France in this case, should want to copy Germany, Sarkozian smoke billows. Too much emphasis on German exports might sail close to the dangerous waters of the effect of those exports on the eurozone. So it's the success of the German economy - GDP growth, full employment - that is touted.
Looking at German employment figures (see also the comments), it became clear that new job creation in Germany, for over a decade, was almost exclusively down to part-time work at fairly short hours, taken up in the majority by women. That looks like women taking part-time positions to bring a little money into households that need it.
While overall real earnings stagnate year-on-year, the Federal Employment Agency gives the figure of between 11 and 12% of those in employment as holding jobs that are beneath the social security contributions threshold - "mini-jobs" at €400 a month, or one euro an hour jobs for the longterm unemployed, for instance. The French newspaper La Croix, in a survey of Germany, cites the economic research institute DIW as giving the figure of 1.2 million wage-earners in 2010 receiving an hourly rate of <= €5 (five). (There is no cross-sector guaranteed minimum wage in Germany). Full-employment economy? Not so much.
Ah, but what about those more than 3% GDP growth numbers we keep hearing about? Growth numbers always depend on where the economy is coming from, and Germany has come back from a well-marked trough. As pointed out by Francisco Vergara in Alternatives Economiques, the climb back is already out of puff. From DESTATIS:
German GDP has risen to its level of the first quarter of 2008, just before the financial crisis, and shows signs of stopping there and stagnating, as DIW's respected Economic Barometer forecast shows:
The IMF forecasts GDP growth for Germany of 0.3% over the year 2012. Taken all in all, that means that German GDP has regained its level of before the financial crisis, and will go on stagnating there (as it used to).
Full employment not, stellar GDP growth not, why should any country wish to emulate Germany?
Oh, the industrial and financial bourgeoisie is raking it in on the export economy? Right, silly me. Whatever was I thinking of?
