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Well, as long as the German gov't threatens to cut off people's unemployment benefits unless they become professional prostitutes, this is going to be a continuing problem.

Ok, enough of the snide remarks.

Someone enlighten me. How much of this is due to the strong euro, how much due to merging the welfare stats w/unemployment stats and how much due to EU regulations that Germany has no control over?

5 million. Is that, say, 10%?

I think that Germany does have many structural problems internally, but do any of you guys want to rethink the EU?

Pamela,

With all due respect, if the EU is the problem, why is Ireland's economy booming then? I think it has more to do with their lower taxes and smaller bureaucracy. In other words, they haven't bought into the failing Socialist model bringing down the German economy.

---Ray D.

Ah, but Schroeder is doing something about unemployment. The Telegraph is reporting that women, including one whose background was in computers, can now be deprived of their unemployement benefits if they refuse to work as prostitutes. The story is at:

http://www.telegraph.co.uk/news/main.jhtml?xml=/news/2005/01/30/wgerm30.xml

Technically, it's a result of legalizing prostitution a couple of years ago and of the government's desperate struggle to balance budgets. But it illustrates all too well just how sick Germany has become.

--Mike Perry, Seattle

Hi Ray!

Has Ireland accepted the euro? Serious question, I don't know. I'm wondering if the strong euro is inhibiting hiring/investment.

And one other thing I would like to point out, although I don't know how much weight to give it. 10-15 years ago the Irish economy was moribound. It really had nowhere to go but up (the population of Irish expats here in the Washington DC area was phenomenal - all fleeing a non-existent job market). The German economy was fairly healthy then, if memory serves, and is in the process of crashing now.

Perhaps it is simply due to two completely different regulatory environments?

The problem of unemployment is mostly attributable to national policies, but the regulatory and welfare burden of the EU doesn't help either. Much of the high level of unemployment arose from Germany's reunification in 1990. For 15 years there's been an employment problem mostly because the German government has failed all this time to integrate inhabitants in the former East Germany into the capitalist economy practiced in the West. The unemployment rate in the Eastern states range around 18 percent, while Western states enjoy rates below 8 percent (I think). Insisting on extending social welfare benefits to everyone before working out a system where everybody participates in the workforce was a big error of Helmut Kohl's. He took other measures to 'soften the blow' of reunification, such as artificially raising the value of East German marks upon their conversion to Western marks. Schroeder was mostly elected because Kohl had few new ideas and was unwilling to groom a successor. Of course Schroeder misdiagnosed the problems affecting Germany and continued the same tired policies of his predecessor. For him to be reelected may suggest that most Germans have become used to chronic high unemployment.

Scapegoats, that's how Germans solve problems. The economic disaster after WWI was blamed on the Jews and we all--well, many of us--know what happened then. Now, everything displeasing to the German elite is blamed on Americans, and especially on Jewish Americans, I suspect. Germany has learned nothing. It's the same old story: It's easier to spit on others than on oneself.

Corbusier wrote
> For 15 years there's been an employment problem mostly because the German government has failed all this time to integrate inhabitants in the former East Germany into the capitalist economy practiced in the West

Ah. Of course. Reunification. I should have thought of that. But to be fair, I'm not sure how much government can do in less than a generation to change the attitude of a population raised in a socialist society toward its relationship with its government.

Look how long it took the American South to catch up with the North after the Civil War. It is only during this generation that Southerners have experienced parity with their Northern cousins.

The collapse of the East German collective society is comparable to the collapse of slavery in the American South. When I last visited 2 years-ago, I saw a junk yard consisting of Soviet era trucks, tractors and agricultural equipment. My German friends explained to me that the junk yard used to be the local collective farm.

Imagine the changes that the workers of this former collective farm have already experienced. Some of them probably stayed in the farming business and bought land. Some probably took to the neon lights of
Frankfurt or Berlin, and sought jobs. And others are probably hanging about, collecting welfare.

Pamela,

What I'm trying to say is that the Federal Republic's (West) policies after reunification failed to stimulate an adequately self-sufficient economy in East Germany. It isn't because East Germans were so used to socialism that they aren't capable of thriving under capitalism. Just ask the Czechs, Hungarians, Poles, and for crying out loud, the Romanians! Each of those other countries have unemployment rates below that of East Germans and are enjoying higher rates of growth as well. Part of the reason Germany's eastern neighbors are faring so well now is that they've undertaken radical reforms to liberalize their economies in order to attract outside investment. Germany has failed to do this, as it has decided to protect the interests of West German companies, liquidated almost East German companies' assets, and imposed un-needed regulations that mostly benefit established Western labor unions but hurt the competitiveness of cheaper and less-skilled East German workers. No wonder all the Keynesian infrastructure projects failed to make a dent into improving employment opportunities for the East. Granted, having lived among East Germans in 1993, there was evidently a lack of entrepreneurial verve due to their socialistic experience, but what could you expect if current policies made it hard to get credit and take risks? Plus, the unemployment benefits paid much better than any job they would have to retrain for.

Hi Pamela,

To answer your question, yes Ireland does have the Euro, the coins have the harps on the back.

---Ray D.

Socialism is a criminal fraud. It's a pyramid scheme. It's "unsustainable". Germany's attempt to have the benefits of both capitalism and communism without the discipline of either has run its course. Game over. If your planning on retiring in Germany in ten years my advice to you is to stock up on catfood and Depends.

Part of the cause for that number is that there was a reform in January. Many people who were on wellfare last year are now counted as being unemployed without any real change of numbers. No question that the number of unemployed people is bad but you can't compare it with last years figures because the background is different.

By the way, the official number of unemployed is published only today. The 5 million now reported are unofficial numbers. That could be one reason why Stern doesn't have its article on the first position. Spiegel does have the article on second position (after the illnes of the pope) and the soccer betting scandal on fifth position.

@Niko

You could use official numbers about the "Erwerbstätigkeit" in Germany.
38.47 million people in Germany are working.

@ Ray D.

Firstly, the five million unemployed did not come as a surprise due to the change in the definition of an unemployed (see Chris's post). As for the betting scandal, soccer is a religion for Germans and Europeans

I would like to say, that being unemployed in the United States is an unpleasant situation. While being unemployed in Germany is a pleasant situation.

In the United States I would have 13 weeks to find work and I have to prove that I visited at least three potential employers. In some circumtances I might have up to 26 weeks of unemployment benefits.

I cannot comment on the benefits in Germany, for I am self-employed here. I have had students who were forced to attend "training" for IT, secretarial skills and so on, who were unemployed, many of them for 3-5 years. Those who were unemployed the longest had learned how to use the system and some of them even boasted about having jobs and collecting unemployment. Some of them worked everyday after school and on weekends. Some were self-employed and collecting unemployment. I reported this to the school director who promptly told me that this is the way it is in Germany and to accept it.

So what does the Government of Germany really know about the number of people who are working and those who are not working? Are the statistics revealing the truth or are the statistics being manipulated? It is difficult to know the truth in Germany, when so many lie about their situation in order to take advantage of the liberal welfare system. I believe that even I could use the system if I ever wanted to. Thank the great spirit I have honor, pride and the will to work rather than to let the country take care of me.

oops the url doesn't work, so here it is again.

"So what does the Government of Germany really know about the number of people who are working and those who are not working?"

@ Nathan

Burocrates on both sides of the Atlantic have the same mind set. A couple years ago, "a Prostitute" became an offical "Beruf" in the German equivalent of the Department of Labor.

Recently, certain burocrates are proposing that long term unemployed German women be given the opportunity to work in the prostitution industry, or lose their unemployment benefits.

When confronted about the morality of the situation, these same burocrates chided that it was not poltically correct to demean prostitutes and that it would be discrimination not to treat prostitution just like any other industry.

After all, why should the Russian Mafia import all these hotties from the Volga, when there a many German woman laying about, unemployed?

@George M.

"Recently, certain burocrates are proposing that long term unemployed German women be given the opportunity to work in the prostitution industry, or lose their unemployment benefits.

When confronted about the morality of the situation, these same burocrates chided that it was not poltically correct to demean prostitutes and that it would be discrimination not to treat prostitution just like any other industry."

That's simply not true.

George M

If the women are "laying about," they are merely amateurs, not professionals, and probably should be counted as employed, but below the minimum wage.

If they are "lying about," they are merely lazy and probably should be counted as unemployable, not unemployed.

It is carelessness with the distinction between "lie" and "lay" that is behind the crisis in German employment: they can't get their statistics right to analyze the problem.

Yes, it's shocking, and it's all Schröder's fault.

Even so the increase has to be put into perspective, for this latest increase is due to the change unemplyoment is measured.

Pamela,

it's not the EU's fault, these problems are all caused right here in Germany.


Mike,

the article in the Telegraph is a canard. We have some new labor laws, that do not explicitly exclude prostitution, so those opposing the new laws are using that to agitate against the reforms. Our constitution specifically excludes forced prostitution, though.


PacRim Jim:

Now, everything displeasing to the German elite is blamed on Americans, and especially on Jewish Americans, I suspect. Germany has learned nothing. It's the same old story: It's easier to spit on others than on oneself.

Nonsense. People here know every well that we only have ourselves to blame.
You could at least check up on the facts before you make such enormous accusations.

1. This prostitute story is a hoax. Here's a translation of a taz article about it.

2. The current number of unemployed has also increased due to statistical effects. In Germany, general municipal welfare and welfare for the unemployed have been merged by 2005-01-01. So, more people register themselves as umemployed now (don't want to deny that unemployment is a serious problem here).

@Niko

We explained how the number came to be and why there was such a sharp rise of unemployed people from December to January. None of us said, that the situation wasn't bad or that nothing had to be done to change the situation.

If Germany thinks that the high unemployment rate is to blame on the reunification with E. Germany. And i know how much the W. Germans hate them and blame them for everything. Well how would you like to support practically the whole world and get spat on afterward. Think about it. The Germans have basically no military to speak of. The only outside money they spend is a few billion to Israel, and their U.N. dues (again practically nothing). And they still complain. That's the real reason they don't want to get involved in foreign affairs, and international conflicts. Hence the reason of the media beating the drum of anti-Bush/Blair. If they did, that would take away from their precious socialist gov't. They ought to marry Canada.

Is this Telegraph article true or just "journalistic license"?
" 'If you don't take a job as a prostitute, we can stop your benefits' "
http://www.telegraph.co.uk/news/main.jhtml?xml=/news/2005/01/30/wgerm30.xml

I know things are bad in Germany but the mind boggles at the thoughts engendered by the this report.
Strange they do not happen to consider that if the woman is married the husband has no say in the matter.

Some not linked comments.

It does not do the west any good for Germany to have this type of problem. It hurts their ability to participate both in the west and within the eu.

The current socail welfare state cannot continue as it has. I do not see how you can get more money from taxes. To attempt to do so is going to be counter productive because those who can will leave. You can see some of that with corperations moving production. Indivudals will follow.

So at some point outlays are going to have to be cut. You are beginning to see some of this now in the areas the current government feels it can cut and no one will get upset. These are so far in the areas of defense and some minor benifit programs to targeted but small segments of the nation.


The age group at greatest risk of having an awful future are those from say 35 to 47.
They have a lot invested in the current system, have less time to adjust their personal lives and the least to gain from the system.

Germany is a net payer to the eu. It pays in more than it gets back. Ireland has been a reciptant of lots of eu development money. It will soon become a net payer. Then one can see how lives there are effected by this change.

@roman thomas

"their U.N. dues (again practically nothing)"

Germany is paying 101.618.395 US $ to the U.N.. Only the U.S. and Japan are paying more.

Chris,

Actually that still is not very much just a little over a 100m right?

Joe,

Depends on the way you're looking at it. Like I said, most countries are paying far less, many just 10.000 US $. Compared to that, Germany is paying a lot. If you compare it to the cost of the Iraq war it's not that much.

Germany has more important problems today. SPIEGEL-ONLINE proves it with the latest headlines:

- Wenn die Prostituierte zur Sklavin wird
- In Personalunion: Polizist raubt Bank aus und ermittelt selbst
- Jelzin geläutert: "Nicht einen Tropfen Alkohol"
- Grufti-Studenten: Pentagramm unterm Arztkittel

Chris,

Compared to the overall size of your economy it is still not very much.

Now you might think it is.

I personally think every penny the US gives the UN is a total waste of US taxpayer dollars.

Hopefully the US will give less and Germany can move from third to second.

Interesting how we go from employment in Germany to UN dues. I am not sure I see a linkage.

What am I missing?

@Joe,
the Germans are trying to distract people from their problems at home (high unemployment) with
foreign affairs (German's involvement with the UN and its opposition to the war in Iraq).
It is a common technique.. it is one that Hitler used..
wait, didn't somebody ELSe say that about BUSH?
:D
hope you can sense the sweet irony and sarcasm.
GO IRAQI PEOPLE GO! you kick ASS.
you are just like George Bush... everybody misunderestimates you!!!

the Germans are trying to distract people from their problems at home (high unemployment) with foreign affairs

Nope, roman thomas started that. ;)

@ PacRim Jim: What "economic disaster after WWI" do you exactly mean? The big economic boom in the 50s, the biggest Germany has ever seen? Learn some history instead of making something up you retard!

@ g-punkt

Well there was a little inflation in Germany after the First World War. Some people even thought it was severe. A few alarmists even call it a hyper-inflation, one of a handful on record.

And if memory serves me the First World War was in 1914-1918, not the 1950's. So perhaps your "retard" comment is self-referential?


Cynic asked:

Is this Telegraph article true or just "journalistic license"?
" 'If you don't take a job as a prostitute, we can stop your benefits' "

The best I could find was a comment here:
http://www.chicagoboyz.net/archives/002828.html#012507

"The article in the Daily Telegraph seems to have been cobbled together from several German sources.

The information about the waitress who was told to interview for a job that turned out to be at a brothel was taken from an article on "jungle-world.com," which calls itself a "leftist weekly." That article was posted July 30, 2003 (!!).
[ http://www.jungle-world.com/seiten/2003/31/1346.php ]
The 25-year-old waitress was told to contact the company "Reni Massage." The woman found the company's website and figured out that it was a brothel and decided to not get in touch. According to the Berlin employment center [which apologized by the way], the job posting had been sent to the woman by mistake. The job offer had been for bar staff (not for "sexual services," as the Telegraph article claims) and it hadn't been obvious from the information that the employment center had received that the company was a brothel.

The second part of the Daily Telegraph article contains information also found in an article from the leftist alternative Berlin daily "tageszeitung," filed on December 18, 2004.
[ http://www.taz.de/pt/2004/12/18/a0077.nf/text ]
Both articles quote a Hamburg lawyer called Mechthild Garweg (note that the Telegraph misspells her first name). In the "tageszeitung" article, Ms. Garweg notes that there is nothing in the law regulating unemployment benefits that would prevent an employment center to force a woman to work as a prostitute if she wants to keep her benefits. It is clear from the article that this is merely a theoretical possibility. German employment centers have meanwhile asserted that they would not be passing on job offers for prostitution."

Insertions using [ ] are mine.
Actually even that "jungle-world" article from 2003 mentions
that there exists an official Federal "decision" that job centers aren´t allowed to offer jobs in the prostitution business.

So I´d say that Telegraph article is "journalisitc license".

Yes I am aware of that. The chancellor has a lot of help from the media too.

This is what I found interesting in the run up to the last national election. This bait and swtich game the spd ran.

I remember we once had a US President who made a statement about raising taxes. He did and the democratics beat him to death with it in the next election which he lost.

I think Herr Gerhart made a similar statement during his first term in office about if he did not lower the unemployment rate he should not be elected again.

Well you know my position of German principles or the lack of them. Unemployment did not get better the people elected him and this is where Germany is today.

I am sure if at all possible the next national election will not be about internal German issues and there are enough of these but the spd will again try to make it about America. If they do they will win. If they fail to do this, they will lose.

I think the spd will again win another term in office. They might be just like our democratic party. I figure the demo's need to lose one more national election and a few more senate and house seats and then they just might get serious about becoming a national party once again. While I cannot support anything they currently stand for there is a need for a 2 party system in the US.

As for Germany I figure another term with the spd in charge will just about do it there too. Things will be so bad there will no other option than to make the hard changes that are needed.

The real question in my mind is do they have this much time.

Kind of like will Iran fall before they get nuclear weapons or not. Both are real gambles.

@Ralf,
you are right, I did not read far enough back.
but I still like my smart ass comment. ;)

Let us all hope that a pledge is not made again to lower this number. The last time it was made the figures went from 4 million to 5 million.

I guess if a second pledge was made it could go from 5 million to like 6.3 million if the trend were to continue.

@pamela & ray d.

Ireland's economy is booming because of much €€€ flowing in there from EU's net taxpayers (UK,France,Italy, Germany, to name a few). Greece, Portugal's & Spain's economy grows for the same reason. Damn socialist system where the richer help the poor.

Greetings,
JoeII.

The linked Spiegel article (re: German Football scandal)provides insight into the German character. The article compares the German Footbal scandal to the Pete Rose scandal. The difference is that Pete Rose's betting never changed the outcome of a baseball game. More important, the articles perspective is, "we may be bad, but at least we're not as bad as the Americans. And even if we are, let's manipulate the facts to convince ourselves we're not".

g-punkt: You appear to be confusing WWI and WWII

Is it just me?

I find phrases in the various reports that state, "This is the worst unemployment situation in Germany since the 1930s" to be very ominous.

Oops I see my response above to g-punkt was unsigned.

I do not believe in anonymous criticism so I am acknowledging my authorship and apologizing for the error.

As far as I know, it wasn't the economic situation that was blamed on the jews by the far right, but the lost war itself. The bad economic situation after WWI was, of course, a consequence of the lost war.
The people thought guilty of betrayal were not only the jews but also the lefts and the democrats. That was one reason why the "Weimarer Republik" was not accepted by many people.

Germany was never conquered in WWI therefore people had trouble believing that the military situation was that bad. The "Dolchstoßlegende" said that Germany only lost the war because people in Germany didn't support their soldiers.

We all know some of the required fixes.

One thing that is going to have to happen is the German consumer is going to have to start spending. Exports are going to only carry you so far.

Of course, the consumer is not keen on spending when employment is questionable even with those who have jobs. Besides the smart people are probably saving like mad for retirement or avoiding taxes or thinking of moving overseas.

To break this cycle is going to very difficult. I am not sure it is wise to wait another year plus to do anything.

Oh, shit! Sorry, I admit I didn't read it properly. I thaught it was WWII of course what he meant and copied the quotation. My fault.

g-punkt

Well postings points were scored by many.

Just smile and consider this was an opportunity to make someone feel good....and you did draw almost as many comments as the topic. If we included the UN, you actually did better.

I would consider this to be a minor victory.

*g*

Chris wrote:
The "Dolchstoßlegende" said that Germany only lost the war because people in Germany didn't support their soldiers.

Man, does that sound familiar.

Ok, back on topic.

What do the German people want? Do the German people know what they want? Do they/you understand what cradle-to-grave security requires?

There is no free lunch. There is a relatively risk-free cradle-to-grave social system that means onerous taxes and little economic growth, or there is a risk-accepting system that guarantees nothing but minimum safety-net circumstances and alot of opportunity.

Is there a "third way" that I'm missing?

The comments here have been more than illuminating. Great thread.

I went to the German government website, http://www.bundesregierung.de/en/, and the unemployment news is no where to be found in the "Latest News" section.

I understand about the delay, considering Schroeder has to come up with five million reasons why Germany's job market sucks right now.

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