Germany: The Model Economy

[Kulindahr]

You can't really compare American and German unemployment. Germany provides incentives for the private sector not to fire its employees, but instead to decrease workers' hours, thus masking "free enterprise."

I like this approach. Krugman wrote about this two years ago. This would never fly here in the US.

There are a number of small companies that have tried this, and the employees love it. One benefit to the companies is that as the economy recovers, they have the same employees with the experience and skills as they had before.



There are a number of very important items emerging here. One:

In fact, lowering wages and a hollowed-out middle class means consumers can demand less and less each year. This puts a brake on economic growth unless another source of demand is found.

That's really a no-brainer. It explains why although some jobs get lost when raises are made, a minimum wage actually boosts prosperity.


Another item is that the super-wealthy do not after all invest their money from tax decreases, or from increased profits, back into production. They haven't for decades.

 

[BostonPirate]

The people of Singapore have what their gov't decides they can have, no more and no less. When it becomes politically expedient to take back all they have given, the seduction will be over and you will see why touting the values of an authoritarian government is a BAD idea.

Tell me how a nation can have that kind of growth without increasing its production of goods? Exactly how is that possible? It has to be through stock market and currency manipulation.

Now tell me this doesn't sound like a Darth Cheney wet dream?

And what are the Authoritarians doing with the Purchased support of their nation? they aren't creating the Island paradise that you often brag about.

Aside from the death penalty and public canings there are quite a few other charming aspects of this society that make any free market loving capitalist shudder.

Right to participate in government
The People's Action Party (PAP) has won a majority of seats in Parliament, and has therefore controlled the government, at all elections since 1959. In 2009 Human Rights Watch described Singapore as an authoritarian state tightly controlled by one party.

Freedom of expression and association
The government has restricted freedom of speech and freedom of the press and has limited other civil and political rights. Censorship of sexual, political and racially or religiously sensitive content is extensive.
According to Amnesty International, in 2010 laws were tightened to limit the freedom of expression and assembly, and used to threaten critics and opposition activists. Lawsuits were taken out by the authorities against dissidents. Government critics and human rights defenders nevertheless held public gatherings.

Military service and Civilian service
Singapore does not offer a civilian service alternative to two-year military service, which is compulsory for all males.

Discrimination

Freedom of religion
Four conscientious objectors, all members of the banned religious group Jehovah's Witnesses, were imprisoned in 2004.
Homosexuality
Singapore law dating from 1938 (Penal Code, s. 377A) bans sexual relations between men, but no prosecutions for private sexual activity have taken place since 1999. In a May 2009 rally at Speaker's Corner, 2,500 gay rights supporters participated without government interference.[7]
Migrant workers
According to Amnesty International one quarter of Singapore's population were migrants at the end of 2009. In 2010 two migrants from Myanmar, after 11 years' work in Singapore, did not receive new work permits, following their active support for Myanmar's pro-democracy movement.[8]
Human trafficking
The US Trafficking in Persons 2009 report listed Singapore on Tier 2: countries not doing enough to address human trafficking. Women are trafficked to Singapore for domestic work and commercial sexual exploitation.[7]

http://en.wikipedia.org/wiki/Human_rights_in_Singapore

Being gay is stil illegal. If they catch you and they want to make an example of you, would you be caned or hanged?

human trafficking and abusing Migrant workers are no way to build an economy.

You ask why there are so many people in Singapore that own property? that would be because the central Gov't has made it illegal for anyone else BUT them to purchase the properties. Of course, as a man with an MBA, you are aware of the importance of the real estate market. Thats why you mentioned it.

http://www.khattarwong.com/index.ph...operty/355-the-law-on-property-ownership.html

Only Singapore citizens and “approved purchasers” as defined under the RPA can purchase residential property (including vacant land) in Singapore. The Controller of the Residential Property (which is the Land Dealings Approval Unit) administers the provisions of the RPA.

Singapore citizens can freely acquire all lands including residential property, whereas Singapore companies, limited liability partnerships and societies can only do so freely after having been granted clearance by the Controller of Residential Property. Foreigners such as permanent residents, foreign companies/limited liability partnerships/societies can freely acquire non-restricted residential property defined by the RPA as:

any flat comprised in a development permitted for residential purposes, not being a landed dwelling house;
any unit in an approved condominium building; and
any unit in a development sold under the executive condominium scheme.
Foreigners, however, cannot buy all the residential units in a building or in an approved condominium building, without the prior approval of the Minister for Law.

The gov't controls who has the land. It CAN only go to Singaporeans. All others are only allowed to own flats condos or rent.

Your Gov't has used a TRUMP vision style system.

You OUGHT to be embarrassed by this stuff, not tout it as a model for germany and the USA everyday.

There are some who know better.

 

[MoltenRock III]

There are a number of small companies that have tried this, and the employees love it. One benefit to the companies is that as the economy recovers, they have the same employees with the experience and skills as they had before.

You should look up a company called SAS Software in Raleigh, NC. They have amazing benefits.

Another item is that the super-wealthy do not after all invest their money from tax decreases, or from increased profits, back into production. They haven't for decades.

Agreed. They invest their money in markets with higher returns, which fosters a I got mine, too bad, so sad mentality. When the wealthy spend money, let's be real, how many luxury home furnishings, clothes, high-end luxe autos, and posh items are even made in America anymore? They're all imported.

 

[EastMed]

One major difference I see is that Germans aren't operating on the "I want it now!" attitude shared by American business and labor alike. That engenders an ability to see that everyone prospers better when they prosper together.

Oh how true that is.
A major factor in Germany's success is the 'mittelstand': small and medium sized SME's, mostly privately owned, innovative and with a commitment to taking the long-term view on business development.

See here

http://www.washingtonpost.com/wp-dyn/content/article/2010/11/23/AR2010112306280.html

 

[BostonPirate]

I'm a bit surprised nobody picked up on my point about workers entering the workforce. I'll reiterate America needs a higher growth rate to sustain with workforce growth.

Plus, I just think the fundamentals of the German economy are more sound, and I love how it's evidence that government intervention not only works, but is essential.

And one thing Germany has that America doesn't: A very strong environmental movement and active Green Party within the Congress. They made significant gains in the last election...

It's a vastly different political system which allows such a party to exist.

http://en.wikipedia.org/wiki/File:Bundestag_2009_Buendnisgruene.svg

Time to wake up America.

its hard for the private sector to keep up with the fact that there are more people coming of age than are leaving jobs at this point. That is why america pursues an economic expansion at all times.

Its not always because the nation is greedy. The gov't is very aware that there are more and more of us entering the workforce everyday.

I don't have a problem at all with regulated capitalism. I think everyone knows here that I am first and foremost a capitalist. I have a problem with social capitalism.

regulated and socialist are two different beasts.

 

[Tengilethos]

Germany's economy grew at 1.5% and you're celebrating? America's GDP grew at 1.8% and I don't remember anyone reputable calling it "very strong growth. "

Did you not think when you first heard of Germany's growth rate that, "Geesh, that 1.5% seems like a low number"?

Growth in continental Europe is reported quarter to quarter, while in the United States growth is reported in annualized figures. Using the US method, Germany has grown by 6%, compared to "only" 1.8% (or 0.45% quarter to quarter) in the United States.

 

[Lostlover]

Growth in continental Europe is reported quarter to quarter, while in the United States growth is reported in annualized figures. Using the US method, Germany has grown by 6%, compared to "only" 1.8% (or 0.45% quarter to quarter) in the United States.

That's not what the data says. Quarter to quarter, Germany grew at 1.5% to America's 1.8% growth.

USA: http://www.tradingeconomics.com/united-states/gdp-growth

Germany: http://www.tradingeconomics.com/germany/gdp-growth

 

[Kulindahr]

Oh how true that is.
A major factor in Germany's success is the 'mittelstand': small and medium sized SME's, mostly privately owned, innovative and with a commitment to taking the long-term view on business development.

See here

http://www.washingtonpost.com/wp-dyn/content/article/2010/11/23/AR2010112306280.html

It's nice to see that what I've long felt to be the case works: that a large array of small and medium-sized companies makes for a healthier economy than a far smaller number of large companies, and that hordes of local and state banks are healthier than far fewer giant banks.

regulated and socialist are two different beasts.

Yes, considering that right-wing fascism goes with regulated capitalism, indicating that regulated does not land on just one place on the political spectrum.

And one thing Germany has that America doesn't: A very strong environmental movement and active Green Party within the Congress. They made significant gains in the last election...

It's a vastly different political system which allows such a party to exist.

http://en.wikipedia.org/wiki/File:Bundestag_2009_Buendnisgruene.svg

Time to wake up America.

It's a political system that actually provides real representation, not just theoretical.

 

[MoltenRock III]

That's not what the data says. Quarter to quarter, Germany grew at 1.5% to America's 1.8% growth.

USA: http://www.tradingeconomics.com/united-states/gdp-growth

Germany: http://www.tradingeconomics.com/germany/gdp-growth

Dude, I cannot understand why you are digging in when you are wrong. From your own cites:

Germany annual GDP growth:

http://www.tradingeconomics.com/germany/gdp-growth-annual



The USA's annual growth rate:

http://www.tradingeconomics.com/united-states/gdp-growth-annual

 

[Lostlover]

I'm talking about the latest quarter growth rate figures. It's not digging in. It's what the link says. January through March, the US economy grew faster than Germany's.

In fact, the links you posted have a disclaimer about confusing the two.

Dude, I cannot understand why you are digging in when you are wrong. From your own cites:

Germany annual GDP growth:

http://www.tradingeconomics.com/germany/gdp-growth-annual



The USA's annual growth rate:

http://www.tradingeconomics.com/united-states/gdp-growth-annual

 

[MoltenRock III]

That's the thing, you're comparing apples and oranges. The 1.8% is annualized which means to figure total growth for any year, you would average the 4 quarterly results. The German 1.5% is quarter over quarter, which means you would add all 4 quarters to come up with annual growth.

That's why your not getting why there are dozens of news stories saying the German economy is booming while the US is stagnating. Google German GDP growth and then US GDP growth in News, and you will see.