Germany still exports things

[eridani]

http://www.washingtonpost.com/wp-dyn/content/article/2010/12/14/AR2010121405606.html

The explosive growth of new markets has been a boon to advanced economies that still make products for export - Germany's in particular. But here, our chief export has been the jobs and factories that once turned out products for export. Defenders of corporate offshoring assert that we can't compete with low-cost labor in China and other developing countries. Clearly, though, Germany has shown that you can retain a manufacturing sector by producing products of high added value even when labor costs are correspondingly high. Hourly manufacturing compensation (wages plus benefits) was $48 in Germany in 2008 - the most recent year surveyed by the Bureau of Labor Statistics - while it was $32 in the United States. Yet Germany is an export giant, while we are the colossus of imports.

Domestic production, however, is just not in the business plans of many of America's leading corporations. Apple employs roughly 25,000 people in this country, while Foxconn - the Chinese manufacturer recently beset by a wave of worker suicides - employs 10 times that many making iPods, iPhones and other Apple products. Dell, the computer company, has a similar 10-to-1 ratio.

Asking American corporations to invest in America may be asking the leopard to change his spots. What, then, should Obama do?

One thing he shouldn't do is hire a successor to Larry Summers who comes from Wall Street. I'm with those who think that Obama could use a CEO on his economic team, but he or she should be a manufacturing CEO with a track record of creating American jobs and a plan for rebuilding American industry. Someone like Intel's legendary former leader Andy Grove.

A refugee from Hungarian communism, Grove came to the United States as a young man and rose to the top of the Silicon Valley heap, heading one of the few high-tech companies committed to domestic production. In a Business Week article this year, Grove lamented the fact that, in the past decade, America's most innovative companies routinely scale up their production abroad rather than in the United States. He called for a tariff on offshored products, with the proceeds to go to a fund enabling such companies to manufacture their products domestically.


http://www.truth-out.org/germanys-economy-shows-government-interference-works66090
In Germany, workers also get six weeks vacation - by law, federally mandated, a right. They get health care, university, child care and pensions and as a result they have higher productivity. In Germany, the government requires worker representatives to hold seats on the boards of directors of companies, depending on the number of workers. Government-funded research and vocational training, and policies to retain skilled workers bring another competitive advantage. Germany values manufacturing and the government has an industrial policy. The government is currently helping promote green manufacturing, for example.

The result of all this government interference is that Germany's export-oriented manufacturing economy recovered from the recession and is doing OK, and their workers are paid well and have great benefits.

Socialism?

Our government is supposed to be of, by and for the people. But today in the U.S. it is considered "socialistic" to talk about these things because it violates the dominant conservative "free market" ideology that is designed to enrich a few at the expense of the rest of us. If we try to talk about a national industrial/economic policy, it is derided with such slogans as "government interference" or "picking winners and losers." If the discussion is allowed it very quickly will move to the dominance of fossil fuels and the other industries that are holding us back but have a lock on influence over the government. If we talk about taking the burden of health care off of the people and businesses, the giant insurance companies beat it back, calling it "socialized medicine," to keep us from doing something about how their profits are draining the rest of the economy. And imagine the furor that would result if anyone even suggested mandating worker representatives on boards of directors so the companies take the interests of workers and communities into account!

Our adherence to conservative free-market ideology is clearly holding our country back. The ideology is designed to transfer wealth from the public to a very few, and hold the lead of the already-dominant. This is killing market innovation and it is destroying our competitiveness and standard of living. We should be looking at what works for the country instead of what keeps the few at the top at the top.

[Name removed]

1. Deleted message

Message removed by moderator. Click here to review the message board rules.

[rucky]

2. Germany is ahead of the US in exports. Here's another article...

http://seekingalpha.com/article/212461-what-the-u-s-can-learn-from-germany-about-managing-its-trade-deficit

Germany is perhaps the best case in point: This Montana-sized country of 82 million people was the world’s #1 exporter until 2008, surpassing the United States even today and only surpassed by China in 2009. Germany is more culturally familiar to Americans than Japan, another strong performer in the developed world. Therefore its policies are easier to understand. (Both nations, by the way, now pay their workers industrial wages higher than the U.S.) This is all without significant natural resources to export (Canada doesn’t count) and while supporting a welfare state generous by American standards.

...

Germany does not use the credit system to subsidize short-term consumption as the U.S. does. For example, Germany has remarkably few credit cards per person. This tends to direct lendable money into investment, not consumption. This tends to favor balanced trade because investment strengthens industrial competitiveness, while consuming more than one produces necessarily means sourcing from abroad (as there’s nowhere else to get goods if you didn’t produce them yourself).

Different tax policies also have a big effect. Above all, Germany has a 19 percent value-added tax (VAT) and the U.S. doesn’t. So American goods entering Germany pay a border-adjustment tax, but German goods entering America don’t, a fact perfectly legal under WTO rules.

The corporate structure of Germany also fights trade deficits. Germany’s universal banks, for example, pressure the companies they own stakes in not to source components from abroad, which would weaken supplier companies they have big loans to. Similar pressures operate in retail and other parts of the supply chain. And the generally high level of German state involvement in industry, ranging from training schemes to state-owned banks, comes with similar strings attached.

[Warren Stupidity]

3. Germany is a republic of and for its people.

And has a government that works hard to make sure that its people can have a good life. We have a republic of and for a small group of elites - a plutocracy - and that government works hard to make sure that those elites and the corporations they control get wealthier and wealthier and wealthier.

[FreakinDJ]

4. What a difference HONEST Trade Negotiations make

Germany's Trade Policies and Trade Agreements were not written and negotiated by a group comprised of Walmart Attorneys

[bemildred]

5. Germany still makes things. nt

[DirkGently]

6. Great post. Germany also does well with sustainable energy.

Another recent study by Roland Berger Strategy Consultants, carried out in collaboration with the World Wildlife Fund (WWF), puts Germany in third place in the world's green technology rankings. "Green tech made in Germany" is already up among the leaders. The country's research effort commands worldwide respect, while its experts boast excellent qualifications – a healthy point of departure indeed. In forward-looking segments such as photovoltaics, solar thermal energy, wind power and hydropower, German companies have global market shares ranging from 21% to 35%. German manufacturers of biogas actually control 90% of the world's market. The country's engineering companies were likewise quick to spot energy efficiency as an emerging megatrend. The environment industry is "one of the standard bearers as we anticipate the end of the oil age," in the words of Deutsche Bank.

http://www.rolandberger.com/news/2010-08-30-rbsc-news-taC_GreenBusiness.html

They're anticipating "the end of the oil age." Why aren't we?

Seems like we've limited our idea of "success" to how many billionaires we have, and how little they have to contribute to the general welfare.