Schroeder's SPD Demolished Again in Saarland State Election

(By Ray D.)

Germany's Socialists Plagued by Unbroken String of Losses

Yet another state election in Germany has resulted in a major loss for German Chancellor Schroeder and his ruling Socialist SPD party. The Saarland elections, held in a small western state bordering France, resulted in a massive drop of over 13 points for the SPD since the last election in 1999. The other major parties in the election all gained between 2 and 4 points.

The SPD: Standing on its last leg?

Even SPIEGEL ONLINE writes that the SPD is stuck in "the valley of tears." More and more Germans are convinced that the Socialist-Green government has let them down. The looming question is: Will the SPD survive until the 2006 national elections?

German Voters Increasingly Turning to Extremists as an Alternative

Recent elections have also revealed an unsettling trend. In Eastern Germany, more and more voters are turning to the PDS, the successor of the Communist party that ruled East Germany until 1990. In the Saarland vote, the NPD, a hard-right neo-Nazi party, picked up 4 percent of the vote, just a single point shy of the 5 percent needed to gain entry into the state legislature. The NPD registered the single largest gain of any party in this election.

Here are the latest results:

Can the SPD sink any lower? Stay tuned...

Update: Scroll down this page and check Schroeder's feet...

Comments

[Hector]

I wish nothing but failure to the party which hates my country: the SPD. The more defeats they face, the more my faith is restored that we can have a future friendship with Germany.

[PJ]

What is the NPD? Forgive my ignorance

[David]

NPD = Nationaldemokratische Partei

extreme right wing

[Max Baurs-Krey]

Ich bin nicht in Deutschland sehr often, aber selbst ich koennte schon sagen das dehr Schroeder nicht sehr beliebt ist.

Deshalb hatten die doch dieses parodie lied uber den Schroeder.

Wenn das SPD nicht den Schroeder aus den weg setzen, werden die in 2006 nicht gewinnen. Dar bin ich fast sicher.

Bin sehr freulich das ich endlich ein blog uber Deutsches politik gefunden habe.

[Harry in Atlanta]

But Hector they are losing for the wrong reasons to the more extreme parties. The social welfare system in Germany is somewhat of the third rail. In order to fix a problem with the rail you have to touch the rail and to touch the rail is death. Unfortunately it would seem that Germany and France have put themselves in a very precarious situation regarding their economies by becoming upside down in their mortgage, so to speak. If the EU collapses making it impossible for Germany and France to spread their pain and bolster their faltering economies by using the power of taxpayers from 25 countries rather than two then I fear the rise of the both the hard right, or nationalists, and the hard left in Europe which would be a recurring nightmare.

It's the situation where the billionaire investor goes to his creditors and says, "I'm broke and I'm going to have to file bankruptcy unless you guys extend my line of credit." His creditors are steaming mad but they have too much invested in his schemes and have to help in order not to lose their own shirts. By giving him what he wants, even though they hate the idea of it, there is still the possibility of a favorable outcome for them, but with bankruptcy they know the outcome. Unless the other nations extend a line of credit to Germany and France to pay for those countries bloated social schemes they know the outcome. Germany and France are cocked pistols pointing at the head of Europe.

From what I'm hearing the absolute #1 issue in Germany is social services, welfare. To me that's pretty pathetic. The overwhelming sense of entitlement amongst so many will ruin Germany for the rest of the honest hardworking Germans.

[DaveP.]

Not to put too fine a point on it, Harry: Too bad.
Europe as a whole has completely run out its credit here in America. Allies we help, and will stand strongly beside. France, Germany, and most of the rest of Europe has dug its own grave.

[JohnPV]

One only has to look at Germany and France to see where the Democratic party would lead us in the US. The Germans are in such major denial they are in serious trouble. The corrosive long term effects of the untenable social bubble that the post WW2 generations have become addicted to will not play out nicely. Furthermore, Germany more than any country, has a historical burden that puts strictures on them that no other country faces -- they can't move to the right because everyone immediately freaks out because of their Nazi past.And even a centrist position is impossible because of the reflexive pacifism that exists in the country. Germany put the forces into play for its destruction as a major world power back in the Nazi era and the final act will come now. Its prosperity is just a holdover from the surviving German WW2 & immediate post war generation whose drive was incredible under the circumstances. But what exists there today are a pampered and existentially conflicted people who are on the way down.

[Jeffrey Boulier]

Harry schrieb The social welfare system in Germany is somewhat of the third rail. In order to fix a problem with the rail you have to touch the rail and to touch the rail is death.

On a note of hope, Germany is not the first state where serious economic reform originated from the left. New Zealand is a shining example where economic reform started with a left-wing government, then continued under its right-wing replacement.

We'll just have to see what the CDU/CSU/FDP replacement does when they take over from the Schroeder. Will the conservatives continue with the track maintenance after watching the prior government electrocute itself, or will they flee?

[Hector]

Harry,
Having (until recently) lived over 8 years in Germany, I am well aware of the issues you discussed. The social welfare system is indeed the third rail and any politician who approaches it does so at his peril. In the 2002 election, the SPD avoided dealing with the economy and social system by focusing on demonizing America. They kicked the can down the road (at our expense) and they are now paying for it.

Germany cannot face up to these changes without a massive campaign to educate the public on the economic dynamics which are forcing the need for any changes. For a supposedly highly educated people, I am always aghast at their lack of knowledge of basic economics (especially among SPD and Gruen types). Until more of them understand these principles, they keep doing what has (for them) always worked in the past: protesting on the streets until they get their way. Eventually, when the coffers are empty, no ammount of protesting works.

Another problem in Germany is that it is unthinkable for someone who is not a career politician to run for office. There are plenty of successful business people in Germany who could get them on the road to recovery but their political culture is too closed. When a person may only vote for a party and not for a person, they are left at the mercy of the party bosses. If Germany were to introduce an open primary type system where the people decide who a party's candidate will be, then perhaps the door could be opened. Until then , the career party hacks will maintain too much control. Again, there are plenty of smart people in Germany who could lead these changes but they are shut out.

Also, there is plenty of young talent and capital in Germany but it is all flowing outward toward eastern Europe and the USA. Their rigid system has too many barriers to entry and does not promote entrepeneurism. The great Mittelstand which gave them so many decades of growth is slowly being chased out of the country. Eastern Germany could have been brought forward much cheaper and quicker by establishing it as a reduced tax/reduced regulation zone for the first 10 years. Add in he key infrastructure projects and you have a powerful combination. The ammount of foreign capital which would have flowed there would have boggled the mind of any Leipziger or Dresdener. Instead, they ran it primarily through tranfer payments and a few public works projects. What a lost opportunity.

[Hartmut]

@ Ray: Don't forget that only merely more than 50% of the electorate was going to vote. The SPD lost the most among workers and unemployed - they are creating a time bomb, where radicals can gain 20% to 30% overnight. It feels like the Weimarer Republik...

@ Hector: You are perfectly right. The political system is a total mess.

And this is a big problem with the so called "conservatives" here in Germany:

THEY DO NOT FIGHT.

The CDU is satisfied if she gets 5 to 10% more votes than the SPD, and their arguments are not much more than "We can do better".

[Gabi]

"Der demokratische Präsidentschaftskandidat Kerry warf dem Präsidenten vor, mit der Betonung der Gefahr des Terrorismus von den wirtschaftlichen und sozialen Problemen des Landes abzulenken. Bush versuche sich hinter Ereignissen wie dem Massaker in Beslan und dem Hurrikan "Frances" in Florida "zu verstecken, um von der Nachricht abzulenken, daß die Kosten für Senioren für die Gesundheitsversorgung um 17 Prozent gestiegen sind", sagte Kerry, der ebenfalls in dem hartumkämpften Bundesstaat Ohio eine Wahlkampftour absolviert."

http://www.faz.net/s/RubDDBDABB9457A437BAA85A49C26FB23A0/Doc~E171CC5B2FE85443DA95D3E6F9DDE0B02~ATpl~Ecommon~Scontent.html
-----------------------------------------------

Diesmal teilt Schröder wohl eher die Position Bushs. Das sehe ich positiv und voller Hoffnung. Es ist grausam, daß erst unschuldige Kinder sterben müssen, um Schröder zu zeigen, daß es nur eine einzige Reaktion geben darf: Terror zu verurteilen und gemeinsam gegen ihn vorzugehen.

Bei der nächsten Bundestagswahl besteht durchaus die Möglichkeit, daß ein bißchen Hetze das deutsche Volk zurück zur SPD bringt. So war es 2002, und so kann es wieder sein. Mit diesen Medien wird sich nichts ändern.

[Hartmut]

Gabi, conservatives in europe will have to create their own media, as in the USA. And it has to be "mass media", like talkradio:

http://www.mainstreamnetwork.com/

[Gabi]

Hartmut,
da sehe ich keinen Ansatz hier. Es wundert mich, daß Konservative sich hier durch Liberale in "braune" Ecken drängen lassen und deren Propaganda nichts entgegensetzen.

Hier ist Fischers Position zum Terror:

"Tatsächlich greift in der EU der politische Reflex, bei Ereignissen rund um den Tschetschenien-Konflikt die Rolle Moskaus stets skeptisch zu hinterfragen. Und so zeigte sich auch Bundesaußenminister Joschka Fischer am Freitag in Valkenburg zwar "schockiert, dass so viele Menschen zu Tode gekommen sind, vor allem Kinder", fügte aber mit mahnendem Unterton hinzu: "Wir müssen dem Terror entgegentreten. Wir müssen ihm politisch entgegentreten, nur politisch." "

Artikel erschienen am Mon, 6. September 2004

http://www.welt.de/data/2004/09/06/328894.html?s=2

[Joe N.]

Well, the Bush-messer has finally been corrected, so that's good.
That the CDU/CSU will be able to do little about budget an taxation is not much of a surprise. How do the commenters feel about what this means for International Affaires?

[James]

@Hector

I fully agree with all of your comments written to Harry: well summarised.

Additionally I would like to raise the issue about the general state of malaise (as I call it) here in Germany today. While I enjoy an almost childish sense of Schadenfreuede over the SPD's/Schroeder's continual defeats in state elections, I wonder which party will be able to truly lead Germany from it's current status.

80% of Germans, when surveyed by the Economist, felt that no party could perform any better on addressing many of the current issues: unemployment, economic growth, pension reform, etc. Also, I recognise that the CDU has been a more traditional ally of the US: Kohl himself said he would have supported Iraq, but I'm not sure Germans themselves believe the CDU would perform much better either.

Which leads me to understand the German persona perhaps a little better: the country is in a state of "malaise" right now, and will continue to be, the US is performing better and ignoring Schroeder: they just engage the national past time: complaining. It is also common for Germans (and Europeans per se) to have a locus of control outside of themselves: attributing successes or failures in life to outside events and the activity/in-activity of the state. Americans and many English-speaking nations are obviously far more independent, individualistic, responsible and self-driven.

So when the German state starts to fail: Germans complain about the state. When the US succeeds, it gets criticised, ignored, demonised and ridiculed.

Jealousy and contempt are not independent emotions.

Sounds like a case of ............

ROOT CAUSES

to me.

Malaise. Hmm we could lend you Jimmy Carter. He is good with malaise. We do ask you keep the killer rabbits under lock and key, however.

[Hector]

James,
You are 100% correct on the malaise issue. I wonder if cultures tracing back to feudal times are susceptible to such dynamics because they keep waiting for the state (fuersten) to make everything right. As a body politic they are unaccustomed to looking in the mirror and coming up with their own solutions.

Also, I have a number of friends in Germany who have lost their jobs. Nearly all are too proud to take something else temporarily or refuse to move to another location where their company has a position. It is truly sad.

If they would be a little less dogmatic and open themselves up to some real reforms, they could recover quite quickly given their excellent infrastructure and educated work force. It is nearly impossible to fire a non-performing employee and the benefits packages are still way too generous for the production they offer in return.

Germany would also be well advised to drop the Euro and pick up the D-mark once again (it will never happen though). Monetary unions without political union seldom succeed.

[Joe N.]

DW international had a commentator who referred to the CDU/CSU/FDP as 'far right'...

[Joe N.]

Is it true Oscar Lafontaine might run off and start a far left splinter party? How much of that 'eating your young' business can the SPD take?

[Pat]

(del.)

Notiz von David: Pat, ich habe keinen Zweifel, daß Du keine schlechten Absichten mit der Veröffentlichung der Spam-mail hattest - aber ich möchte solche Inhalte nicht in meinem Blog finden. Wir werden von Google bei allen möglichen Begriffen recht gut platziert, und ich möchte nun nicht ausgerechnet mit einem solchen Blödsinn - den Du ja auch als solchen bezeichnest - gelistet sein. Ich bitte um Verständnis.

[Jan]

@Pat:

Tja..., wo kommt denn der Grossteil solcher Mails her ?

Abacho.de Translation:

Tja, where the majority of such Mails comes?

[Jan]

Ja, das sind dann auch so glaubwürdige Nachrichten wie die vom Spiegel, FAZ, Bild, bla, blubb... Man sollte jedem, der überhaupt auf die Idee kommt, was von diesen Spammer zu kaufen, kräftig in den Arsch treten. Aber leider finden sich unter Millionen immer ein paar Schwachköpfe, die das dann noch lohnenswert machen.

[MaDr]

I have every confidence that Germany will "eventually" rise to the occasion, but it will take strong conservative leadership, ala Thatcher or Reagan. I fear, though, that her weak sister, France, will continue to pull her down for the foreseeable future. Germany can not rely upon any help from the US (like inflating the dollar) - Schroeder's persistent reliance on anti-Bush and anti-American rhetoric
has doomed any sympathy from the US.

[Joe]

I have read some very interesting articles and analysis this weekend about polities. Most of it had little to do with Germany but at the same time it could in many cases have been written about Germany and the German people.

Germany I fear is at a very critical stage as a nation. The next few years are going to determine what future the Germans will have for maybe the next several decades.

Given what I perceive to be the political and social make up of the Germans of today, I am not sure if the future is going to be a very bright one for them. I make this statement because I do not know where the ideas and the leadership will come from or if the people will accept the reality of how their lives must change and the pain some of them will suffer if they are in fact to have a bright future. All of this seems to take more courage than is present.

How the current situation has come to be in Germany is an area which I find fascinating to me but which I have so little understanding of. Looking at Germany today, it is as if it was structured for failure. Many of the attitudes, institutions, and philosophies held by the German people seem to have made prefect sense and to have been reasonable in the 50’s and early 60’s. Now these seem to be more of the problem than part of the solution. There seems to have been no evolution in any of these from 1953 to today.

As the Germans dislike change more so than most people they cling to these even when new ideas and solutions appear to be needed.

In Thomas Sowell’s book, “A Conflict of Visions” one of the premises is that people will do almost anything for their vision of the world except think about it. To think about one’s vision of the world is the obvious first step in changing one’s vision. Thus there are few people who ever really change their minds and or visions.

This seems to be one of the factors working against Germany today. A second factor is the so-called elites, which now infect almost all aspects of German political debate.

I think many of the Germans fear and distrust the concept of a democracy. They, and here again especially the elites, distrust the common sense of the average person. The intellectual class believes Hitler was democratically elected and supported. Again this seems to be one of the reasons why a national referendum to ratify the EU constitution is so opposed by some in Germany today. It is why this became part of the German basic law or constitution.

In fact, one could say that with the EU Germany is moving away from democracy. The government is becoming more and more less accountable to the average German voter. Under the form of constitutional government in place in Germany, one does not really vote for a candidate but one votes for the party. The party then gets to choose both the representatives and the leaders.

The elites are firmly running things. This is true whether they are in academia, media, or government. Almost all of these are of the Left. Even those who are considered to be hard Right are more along the lines of a moderate democratic in the US. Those who are even more Right are labled Nazis.

Ideas can only come from the Left. If any ideas come from the Right, then these ideas are attacked and or the holders of these ideas are attacked. What this does is to limit not only the possible solutions but also debate. The ideas, which are presented, must fit into the framework of the concepts of social justice and the welfare state.

Think for a moment of some of the things being reported in the press or at least being reported in English under a Goggle search of news from Germany. There is the threat of an even more Left wing of the SPD being formed. Any place but Germany the first question would be how is this going to solve the current crises now raging in Germany. Of course, many in Germany do not think there is a crisis.

Think of how America and even more so President Bush is being demonized by both the Right and Left. I for one think this is a very clever poly by the elites. This not only strengths their current position but also makes any possible solutions which might look American in concept to also be considered evil. The Germans even have a word for this.

So where does this leave Germany today. It is a nation, which first looks to its elites for answers. It is a nation, which rejects ideas from the Right. It is a nation, which because of history fears a strong leader. It is a nation which does not trust it citizens to make wise decisions. It is a nation, which resists change. Yet, it is a nation, which cannot continue to live as it has.

So one can safely say, things in Germany have to get much worse before there is even hope for change. It is unfortunate that while waiting for this to happen there will be more pain and the solutions will bring even more pain.

[Zhang Fei]

Joe: The elites are firmly running things. This is true whether they are in academia, media, or government. Almost all of these are of the Left.

It's a lot like the Greek aristocracy's relationship to the helots. They get to think deep thoughts, and we get to work to support them.

Zhang Fei,

Aha, thank you for making this more clear for me.

If I am to understand you correctly, this is part of the concept of "social justice". A few work so most do not have to work.

[Pat]

@ David: Ja, hatte da keine böse Absichten, nur als Warnung für die anderen (auch wenn es bei dem schlechten Deutsch und Englisch eigentlich offensichtlich war, aber ich bin eh ziemlich baff, wer alles bei dem Phishing so reinfällt). Sorry und nix für ungut!

@ James: AS always your comment is thoughtfull and very interesting to read, gives me some things to contemplate (and as usually too, some minor headaches for some of the hurtfull truth in it).
I am not to sure either about the future of my country nowadays. There are some godd developments, but the majority of the West is still too much influenced by the wrong understanding of the system of social welfare our founding fathers had in mind in the beginning. The East, at the same time, is still throughly confused, at least those people age 40 and older, about the changes after the fall of the wall. Democracy did not have a chance to plant deep roots there at all, not since Weimar anyway (and that was not a democratic model worth following). Interestingly enough studies during DDR-time showed, that racial sterotypes, for instance, remained unchanged during Socialism, even though some of "races" were not to be seen in the DDR. Same is probably true with sterotypes about politicians. It is therefore an easy predicition to say that extrem right parties like the NPD might well succeed in the upcoming elections in Saxony and Brandenburg. We will than read a lot about Neo-Nazi in Germany.... but the past couple of years and elections have shown, that these groups evaporize in the parliaments within 1-2 years about quarrels among themselves and about having to cope with daily political work. Hence I am not afraid of this development. The other thing is the growth of the socialist party PDS in East-Germany. Here the CDU has made a lot of mistakes after the reunification (and my own party CSU also in not running for election at least in Saxony and Thuringia due to some alleged threat by Kohl to have the CDU run in Bavaria as well, if that happens). So far the PDS did suffer a little bit when the elections turned out to be too successfull so that they had to participate in local and state gov., but not as much as would have been expected or hoped for. Here the organization behind the party is too strong and it has succeeded in making the PDS the speaker of the disgrunteled East Germans.
A new left party will only be able to succeed in WEst Germany, especially if there is strong support from the German Unions. Thats why sometime ago I said that we do need a Maggie Thather to take on the Unions and cut them back to the right size.

The German dislike of changes puzzles me. TRy to change one thing even at local stage and you find one or several "Bürgerintitiativen" against it at once. Change is bad, so it would appear.

However, I have to dispute some of your thoughts:
a) it is true that usually both large parties, CDU/CSU and SPD are more believing in the sake and wisdom of the state than in the wisdom of the electorate. But I do not believe this to be a result of the "elections" in Third Reich. It is just a basic fear of German authorities in face of the people. Only the FDP and the GRüne do give the people much more rights and power.
b) A national referendum about the EU constitution is a totally different thing. You can not reduce such a complicated legal work to a simple yes/no answer. I was similarily opposed to voting on the new constitution in Saxony in 1992 or 1993 for the same reason. A constitution is a compromise after a long and complicated process and it is easy to find one thing, that one does not like and for this one reason to object all the rest. I do not think that either the US constitution nor any of its major amendments were put to a national referendum (maybe the Volstead act, I am not to sure about this). If I am wrong please feel free to correct me.
c) you are right on target with the accountability problem with reference to the EU. But it could be misunderstood that for all elections in Germany you vote only for the party and the list. This is not true and for the sake of other foreign readers let me please point out, that for most local elections you can directly elect your candidates (in Bavaria you find a list, but you can pic any candidates from any part of the list). State and Federal elections find a mixture of list voting and direct voting. Half of the seats are in the parliaments are elected directly in county elecetions with candidates face to face, the other half is elected by list. I always found it quite good to have the list election in addition too, because it helps to bring people with not much media interest but good credentials and a lot of experience into the parliaments too. Only the EU elections so far know just the election by list. This is stupid, because those elected are not very much anchored within the constituencies and therefore also not very highly thought of. But I am reasonably sure, that the next election on 5 years will see a change of election system for the better.

The overall problem in Germany with change is, that nobody takes John Paul seriously who said: I don't know for sure if things will become better if they change. But I know for sure that things need to change before it gets better!

Cheerio and thanks for your thoughts, James.

I must admit I do enjoy how the German media likes to go on and on about the bad economy in the US. I some times wonder just where these people live. I have to assume it is in Germany as the papers are in German and the web addresses contain .de. I think of the latest jobs report. More jobs were created in the US in one month than have been created in Germany in the last 3+ years.

Some how I just don’t get this kind of reporting. Being a rather stupid American, so labeled by most of the citizens of france and Germany, I still don’t get it. I have to be missing something somewhere and it is driving me nuts.

I have to assume Big German Media thinks the German economy is doing just fine. It would seem most of the German people agree with this also.

So if this is the case, then I am sure Gerhart and the SPD will win in 2006. It is only a matter of who they will blame this time – Kerry, Bush, Putin.

[Pat]

I just recognized that my above comment was aimed at Joe and not at James. Silly me.

Referring to the anonymous above with his complaint about German media speaking badly about US economy:
a) I have not seen recently any such articles in important German media. They do point out the huge deficit of the federal budget though. But usually the only typical complaint of German media about American ecnomy is, that people in the US are forced to have two or three low-paid jobs to make a living in comparison to German social welfare. I agree: this is stupid and does not recognize the immideate danger the German economy is in.
b) if you compare the jobs created in the US with the ones in Germany, you are certainly right that GErmany looks comparatively bad to the US and a lot of other economies of industrialized countries when it comes to job growth. However: comparing the total numbers does negate the different size of economies and work force between Germany and the US and is therefore just wrong.
c) on the other hand it would not be seemingly to brag about the US economy. Once again it is living on borrowed money and borrowed time, it would appear. American households are indebted with 115 % of their fortune/value. Once again a huge bubble in real estate and mortgage financing has been created in recent years. It would just need one small shock to the real estate market and yet another bank desaster with millions of people loosing their homes and fortunes will happen. The "Economist", hardly a leftish magazine, recently wrote, that the American public accounts look as good and reliable as Enrons for some reason. Chrysler and GM recently attacked all the American subproducers of car parts, that they work far below todays world standards in reference to quality and reliability. And while the US has used very cleverly the slow and bureaucratic behaviour of universities in a lot of western countries to attract the most clever and eager scientific minds of the world to the great American universities, the current policy for visa applications has already started to keep those eager minds from joining forces with their American counterparts for the better of the US future. And last but not least: while I thought that Germany has the most complicated and stupid tax law in the world, studying the American tax code I found out that it has a close competitor for the goldmedall for worst tax law.

Therefore some critics towards the US economy are well varanted. But I agree with you insofar, as the Germans should rather shut up or put up.

Cheerio

[James]

@Pat

I think that some of your comments may have been directed at me, but alas I choose to respond to your recent comments...

I think that you would agree that finding any positive comment about the USA is close to impossible the Germany of current. Additionally, I am not sure if comments would miraculously improve overnight if Schröder were to do the honorable thing and resign. And there is good reason for him to do so, he has lost in every election except for the one that counted. Only through a now-regrettable intention the allies had to prevent an undesirable party from spontaneously coming to power: Bundesländer don't vote on the same date.

a) Funny though you never hear the German media complaining that the Germans and French being the biggest violators of the 3% deficit rule. A rule that they insisted in having: hypocrites.

b) "However: comparing the total numbers does negate the different size of economies and work force between Germany and the US and is therefore just wrong." To be exact, Germany and continental Europe per se haven't created a single job in the private sector in over 10 years. The few jobs that have been created have only been in government. This is called Arbeitsbeschaffungmaßnahmen in German.

c) "on the other hand it would not be seemingly to brag about the US economy."

Why not per capita income is 35KUSD per year and Germany in only 25K??

Have a look at Fraser Institute, the world leader in compiling data from all over the world and determining which countries are the more "economically free" http://www.fraserinstitute.ca/shared/readmore.asp?sNav=pb&id=681

Germany is tied with several other countries for 22nd place, behind Botswana, Oman and Kuwait. The US comes in 3rd with NZ, UK and Switzerland. In short, their study shows that the better a countries performance on the "economic freedom scale," the better it's citizens are in income.

Germany really gets beaten up on, well you guessed it, the flexibly of the labor markets; it appears Germans are not flexible people. Additionally the relative size of the Government to the overall economy is too large and taxes are also too high. The US, as you rightly mention, did worst on "Administrative obstacles for new businesses." Which honestly really had me wondering...

Regarding your point about visa applications, let's be honest here: this is mostly targeting KNOWN terrorist countries: Arab countries, Indonesian, Malaysia, etc. Many of the brightest immigrants to the US still will be "volunteers" from Europe. Furthermore, what is America to otherwise do? Muslim extremists that were mainly studying in your country attacked us. I think that Americans would rather suffer the side effects of the measures than roll over in a bath of denial and play Gerd Schröder...

Any banking crisis in the US would also be a catastrophic crisis in Germany. The old adage, when the US sneezes, Europe catches a cold is still true.

Germany really faces a really big challenge though, the pension problem with the issue of shifting demographics. These really are not problems in the States. However, Germany could improve its situation, i.e. on the "economic freedom scale" were it to address some of the points above: labor costs, etc and the next generation would benefit. But I really wonder if Germany has the stomach to do so: I mentioned this in a previous posting as "malaise." Also, many other people have posted that Germany also hasn’t the ability to change it's "security blanket." Do you know how many times, I've been told be Germans that "we [Americans] just throw people out on the street." And we get nothing, and there is no health care, bla, bla, bla... (Although most economists would tell you that this gives workers, employers incentive to re-educate or re-tool thier workforce and economy, preparing it for the next hiring phase. This is why globalization is good, it just needs to happen gradually). Ironically what strikes me is just how badly informed your average German is on The USA regarding just these issues. And it gets even worse when one starts to talk about American politics, history, racism, etc.

You only need use Jo as an example...

[amiexpt]

re: Stability pact.
when Germany ignores international agreements (ie stability pact) that it signed, and indeed authored, it is NO BIG DEAL.
When Bush says no to Kyoto (when it was a dead duck in the Senate anyway), where it really matters, all hell breaks loose.
am I the only one to find this morally hypocritical on the part of Germany?

[James]

@amiexpat

Nope. That's why I raised it as well!

Pat,

You make some very good points. These have been made for years about individual debt and national debt. Everyone is waiting for the other shoe to drop and for something to go terrible wrong with one or both of these. In the last three years the American economy has endured several shocks. Some of these have been the market bubble, the terrorist attack on 9 11, and the scandals in corporate accounting. It has had to struggle to regain it footing. This has been accomplished by an aggressive policy approach in both the areas of fiscal and monetary policy.

This is however not to make light of the debt that exists in America. Some of this debt is a bit misleading in that most of the individual debt is tied to home ownership for the vast majority of Americans. Home ownership is as much of American culture as baseball or today SUV’s.

As for national debt, the percentage of GDP consumed by government in the US is significant less than what the German government is currently consuming. There is some flexibility to raise taxes in the future should the need arise. This is a limited option for most of Europe. The latest projections of US government consumption of GDP for the worse of the out years, 2050, are 36.5%. This is currently less than what is being consumed by Berlin today. This projection does not consider any policy changes which might occur in the US.

The percentage for the US includes both interest and debt repayment of the deficit. So while there is reason to be concerned, there is time to make adjustments. This is one of the issues of the current presidential campaign, which keeps getting pushed to the back pages. President Bush is willing to address reform of our social welfare programs while Senator Kerry has made it clear that his only policy option is to raise taxes to support these programs.

Consider this to be an example of the classic tax and spend attitude of the democrats in the US. They are a party void of ideas. They are even worse than the SPD in this area.

[Joe]

Pat,

I forgot to put my name on the above posting.

Joe

[Sid cochran]

I've read the basic report and the comments with interest, and no little confusion. From the comments, I think that under German-style Proportioal Representation, those parties which poll above 5.0% of the total vote in a Land or province, share the seats subject to apportionment in proportion to their relative shares in the total vote, while partie sthat do not get as much as 5% of the total vote go sorrowing away, swearing to do better next time around.
That makes it look as if the CDU might have won an absoluite majority of the seats in the Saarlander Landestag--but if so, why is the electin not reported as a CDU victory, rather han an SPD defeat? Will the rules of PR prevent the CDU from attaining a majority in the Landestag? Wil the political dynamics of German politics bring the FNP and the Sonstige Party into the SPD-Green Alliance that currently places Gerhard Schroeder as chancellor and Joschke fischer as foreign Minister of the Federal republic/This old and decrepit Southerner would like to know how any seats in the Landestgag the repective parties will attain as a result of this election, and what the divisin of seats in the bundestag if there is a simlar divison of the vote at the next General electino? why is evryne afraid that the NPD will brak the 5% barrier and get ANY seats inthe Landestag?I hope readers will take pity on my confusin and advise

[Pat]

Sadly enough I missed the interesting discussion about German and US economies over the weekend. Had to much pressing business at hand and thus needed to work through the weekend.

Guess the discussion has moved on by now and it does not make much sense in picking up the thread after 4 days again. Maybe we can have this discussion again at a later point at this blog? would be interesting! What I wanted ti point out is, that not everything is golden with the US economy and not every thing is black and bleak with the German economy. But undoubtedly Germany needs much more reforming, has missed curcial times for reforms because some wise as..., I mean guys, like Norbert Bluem closed their eyes in front of available facts and predictions and simply wrapped over the old and stupid system to East-Germany during reunification. Hence a lot of critizism above is well taken, especially waht NIko said about German attitude towards SME (KMU in German). This is the worst part of continuing policy in Germany: burden the SME while focussing subsidies and regulations on the big industries. Only with massive deregulation can we succeed a major reform in Germany, only by freeing the entrepreneurial spirit of SME in Germany can we get major growth of employment.

Thats it for today, talk to you guys (James, Joe, Niko) soon.

Cheerio