The SPD's New Scapegoat: Global Capitalist "Locusts"

(By Ray D.)

What do you do if you are running a failing German political party that desperately needs to win an election? Well, if the SPD (the governing Social-Democratic party of Gerhard Schroeder) is any indicator, you find a convenient and popular scapegoat to blame Germany's problems on and make lots of excuses. It already worked once for the SPD during the 2002 election when they blamed Germany's economic woes on 9/11 and floods in eastern Germany and exploited German war fears and anti-American sentiment to pull out a come-from-behind victory. As a matter of fact, the 2002 election marked the last time the SPD led in national polls over its main rival, the CDU (Christian Democratic Party).

Now, with a critical state election in Nordrhein-Westfallen approaching, the SPD leadership is hoping the same tactic will work again and pull the party out of the abysmal ratings canyon in which it has found itself for the past three years.

Ratings 2002-2005: "If next Sunday were election day..."

SPD Ratings Canyon: Election 2002 Marked the Party's Last Lead
Source: ZDF Politbarometer

The SPD's major problems?: The Iraq war is no longer a major issue and people are slowly growing tired of America-baiting and Bush-bashing. Unemployment is at record highs and expected to rise, economic growth has slowed to virtual stagnation and the country continues to run chronic deficits above the 3% maximum set by the EU. So, what is the sputtering German left to do?

2002-2005: How Germans View the General Economic Situation in Germany
gut = good (green), schlecht  = bad (red), teils/teils = so/so (white)

         

Dismal: Only 6% View Germany's Economic Situation as "Good"
Source: ZDF Politbarometer

Of course the Social-Democrats and Greens can't tell the truth and actually admit that they are at fault for the nation's dramatic economic woes. So, just as in 2002, a convenient scapegoat has to be trotted out to distract the public and spark a divisive debate that the leadership hopes will propel it to election-day victory. And the SPD's political guru, Chairman Franz Muentefering, knows just what issue is sure to fire up the party's base...or so he thinks...

Public Enemy #1: Global Capitalism

That's right ladies and gentlemen, Comrade Muentefering has boldly identified global capitalism as the new enemy of the courageous German Socialist movement. Unfortunately for Muentefering, not all of the German left is going along with his intellectually-lazy attacks on financial investors as "locusts." Green fraction leader Katrin Goering-Eckardt, for example, objects to painting all members of the private sector with too broad a brush. Others, on the other hand, think that Muentefering isn't going nearly far enough. Some of them, including hardline union members and angry unemployed workers, went so far as to pelt him with eggs during his May-Day speech.

Opponents of all political stripes are also highly uncomfortable with the SPD's McCarthy-like creation of an enemies list of supposed capitalist transgressors who are to be targeted with boycotts and other consequences. An enormous argument has now broken-out all across Germany that transcends party lines with some on the left defending the "capitalists" and some in the CDU opposition supporting Muentefering. Unfortunately for the SPD, the argument has done little to improve the party's ratings in Nordrhein-Westfallen or anywhere else in Germany...

Chairman Muentefering Says: Down with the Capitalist Locust Enemies!

According to N24, the SPD is now denying the existence of the infamous "locust" list, but has admitted that "a paper exists" that "objectively documents examples" of firms that have allegedly split-up and broken-apart German firms like "locusts" descending on a field. And guess what? The majority of the "asocial, market radical, locust" companies targeted by the SPD in its anti-capitalist crusade just happen to come from the USA. Some things just never change...

The German Media: Economic Reporting SPIEGEL-Style

Speaking of capitalism, here are two interesting SPIEGEL ONLINE articles on a related topic (GDP growth) that recently appeared just one day apart and clearly underline the magazine's political leanings:

Article 1: SPIEGEL ONLINE on GDP Growth in the United States - 28 April 2005:

"Danger for the World Economy: US Economy Losing Steam

America's economy has not grown at such a slow rate for two years. Europe's stock markets came under pressure after the surprisingly weak economic numbers.

Washington - The GDP of the world's largest economy grew in the initial quarter with a rate of 3.1% when calculated for the entire year after 3.8% in the fourth quarter, as reported by the US Commerce Department."

Article 2: SPIEGEL ONLINE on GDP Growth in Germany - 29 April 2005 (one day later):

"Economy: Government Lowers Growth Prognosis

The Federal Minister for the Economy Wolfgang Clement will today lower his growth prognosis for the current year. According to information from government circles in Berlin, Red-Green will also now assume, that the German economy will grow just one percent instead of 1.6%.

Berlin - According to information from the newspaper "Die Welt," The SPD politician Clement is going to name a corridor from 0.75 to 1.25 percent. For the calculation of the federal budget and the funding of the welfare system, a growth rate of 1.0% will be assumed. Up to now, the coalition believed that GDP would grow by 1.6%. For 2006, Clement wants to fix the government's prognosis at 1.6%."

Naturally, SPIEGEL ONLINE completely fails to point out that the supposedly weak and dangerously low first-quarter GDP growth rate in the United States is still more than three times higher than projected GDP growth rate in Germany for 2005! Yet the magazine strikes a far more negative, alarmist tone in its article on the United States, claiming that a three-month, short-term decrease in GDP growth from 3.8% to 3.1% poses a "danger to the world economy" and is evidence that the "US economy is losing steam." By contrast, SPIEGEL ONLINE's entire article on lower government projections for German GDP growth is completely neutral and uncritical. Again, this despite the fact that the German government's projected GDP growth rate is over three times lower than the dangerously "slow" growth rate in the USA!

Somehow this doesn't logically add up. Unless, of course, you factor the massive anti-American bias of SPIEGEL ONLINE into the equation. By the same token, it is very difficult to compare these two articles and not come to the conclusion that SPIEGEL ONLINE is heavily biased in favor of the German national government. Here again, Gerhard Schroeder and company have received a virtual free-pass from their poodles at SPIEGEL ONLINE. 

Incidentally, the 1.0% projection made by the Schroeder government is generous in light of the fact that six of Germany's leading economic institutions just released a prognosis of only 0.7% GDP growth for 2005. And here is another fact you won't see reported very often in the German media: GDP per capita in the United States under President George W. Bush has remained approximately $10,000 higher than it is in Germany under Schroeder over the past several years. Maybe when it comes to economic growth and prosperity, American cowboys are smarter than European sophisticates after all...

Capitalist Cowboys vs. Socialist Comrades: Unemployment: 5.2% vs. 12.0%

On unemployment the picture is much the same. German unemployment is more than double that of the United States. But that large difference is rarely mentioned in the German media.

"Amerikanische Verhältnisse": American "Locust" Companies Have Produced More Than Enough Jobs in the USA without Socialist Intervention. And if Bush is a 'Stupid Cowboy', what does that make Schroeder and Muentefering?
Sources: US Department of Labor, Bundesanstalt für Arbeit

Some may defend Germany by pointing out that the high rate of unemployment in eastern Germany is the reason that the overall national rate is so high. It's true: Eastern Germany is a major burden on the German economy. But even if we ignore the east, unemployment in the west is still currently around 10%, almost double the current level in the US. Furthermore, unlike the US government, the German government isn't burdened with high military expenditures and hasn't had to directly deal with the consequences of the September 11 catastrophe and its aftermath.

But of course, SPIEGEL ONLINE and other German media outlets will largely continue to focus on the few stories that shed a negative light on the US economy despite the fact that America (with its "locust" private sector) is outstripping Germany on almost every economic level. A recent example was this negative SPIEGEL ONLINE article on working Americans without health insurance. Certainly, such critical stories are legitimate and necessary, but in order to achieve some balance, the German media must also put them into context by reporting on the many positive developments in the US economy and fairly comparing them to developments in the German economy.

Unfortunately, that rarely happens...

Update: Joe N. of No Pasaran! pointed out this excellent article in English on Muentefering and the "locus list" at Financial Times. Be sure to check it out.

Comments

[Mohammad]

Excuse me, but is Germany a muslim country yet?
No?
Sorry, I'll check back next year.
Thanks.

[Laurence]

Greetings all

My family and I are humble shareholders of several mutual funds based in Germany. We began our trust and investments in Germany about a decade ago. Our returns have been most excellent over the long-term. (holdings in the Germany Fund Inc. New Germany Fund Inc. and WestAMWerteFonds)

Several personal friends, and today's Bloomberg and Fidelity Investor alerts regarding the safety of investments in Germany seem a bit alarmist.

Has anyone heard within Germany or does anyone foresee any indications of near-future German government restrictions or possible government confiscations of the personal investments, savings and holdings in Germany held by foreigners?

I thank you in advance for your reply and,
best regards

[Steve]

There are several problems with the line being taken against "locust capitalism".

One, it doesn't identify the real problem. Is Mr. Meunterfering implying that the employment situation in Germany would be acceptable, if only these 11 companies on his list were banished from Germany and had their investments siezed? I sincerely doubt the Deutsche Bank, KKR, etc. have accounted for more than one or two tenths of a percent of the current German unemployment rate, if that. So, assuming that say, a 6% unemployment rate would be viewed as acceptable in Germany, what is accounting for the other 6% or so of the work force that the "locusts" aren't responsible for?

Two, it begs for retaliation abroad. Is Mr. Meuntefering going to go to bat for U.S. auto workers if Diamler-Chrysler starts laying off more workers from Chrysler plants in the U.S.? Is the SPD going to lie down if American start demonizing and boycotting investments by German companies in the U.S.? Maybe I'm being cynical, but something tells me that at the moment something like that happened, we would start hearing all manner of tut-tutting from the SPD about the contributions German investment makes to the U.S., appeals to the shared values and "alliance" of Germany and the U.S., and appeals to the U.S. government to protect Germany property and citizens.

Three, along with the "locusts" who may or may not actually be missed in the German economy, it drives away lots of other investors who might be interested in Germany. If you are planning on locating or buying a plant in Europe, do you want to risk putting it in a nation where you could be denounced and boycotted if, 4-5 years down the line, you might have to lay off people because of market conditions? I'm sorry, but Germany is not "all that". If Germany was an incredibly compelling place to locate European operations, chances are that the unemployment rate wouldn't be what it is in the first place. Germany has to compete with other locations around the world, and demonizing foreign investors doesn't help in that process.

Four, some of the steps that SPD members are suggesting are pretty economically ignorant. OK, you want to boycott a company that layed off a lot of workers? Maybe the company did that because they were struggling to compete. In that case, your boycott is only going to cut their business more, and result in even more layoffs or even an outright closure.

Regarding the comparison of the U.S. GDP growth rates with Germany's growth in Spiegel, I would point out several things.

I don't mind Spiegel reporting on the U.S. economy. It's the world's biggest, so they probably should. I don't mind them talking about falling growth in the U.S., that is both obvious and newswortht. It's also to be expected as the Federal Reserve trys to rein in inflationary pressures.

I do mind the "threat to the world economy" angle. Perhaps Spiegel should chime in with something along this line for reports on German or European growth? The world economy would be a lot healthier if the U.S. had a little more help in actually buying all the stuff that people produce.

Also, the "threat to the world economy" language betrays the mixed feelings/messages that much of the world expresses towards America. I see lots of stories, concern and tales about how Americans spend or consume too much. Food and energy being the biggest examples in these these areas.

Now of course, when there is a risk that (growth) in American consumption will be (a little) less, all of a sudden it's a "Threat to the world economy". Sorry, but that's a mixed message, and for even for those Americans who follow foreign opinion, it makes it pretty maddening to figure out what the world really wants. For Americans who don't follow foreign opinion, it just justifies their decision not to do so. Why bother trying to understand the needs of someone who doesn't know what they want?

It's not good for piggish Americans to consume too much, yet when the amount of stuff they consume grows more slowly, that's bad. It's not good for the Americans to start a war not sanctioned by the UN, unless that war is in Kosovo or Bosnia. It's not good for the U.S. to promote capitalism, but please help us do something about our unemployment rate (the flip side to Mr. Meuntefering's argument is that if the U.S. companies have the power to destroy German jobs, they probably have the power to create them as well)

All of this stems from some kind of belief that somehow the U.S. is responsible for ordering the fall of every international sparrow. Or even that the U.S. is responsible for the good or bad things that happen in someone's personal life. That's pretty much untrue. The U.S. simply doesn't have that kind of authority, since that kind of power doesn't exist.

So please, if you are going to ask or expect something from the U.S., figure out what you REALLY want,and then take ONE position and stick to it. It would make it much easier to accomodate your needs.

[Cousin Dave]

@Steve (great comments, BTW):

Is Mr. Meuntefering going to go to bat for U.S. auto workers if Diamler-Chrysler starts laying off more workers from Chrysler plants in the U.S.?

There's an interesting point to be made there, just to make things more complicated: Daimler-Chrysler has actually been moving jobs from Germany to the U.S. over the past 7-8 years. Given that pretty much everyone inside D-C admits that it's the German execs who run the show these days. Is D-C going to get put on the "locust list" for this?

Another point: There's an increasing awareness in the U.S. that certain American business giants, companies that are important to the U.S. economy, are having to compete in a biased market due to competition from subsidized European companies. One of the ones being called by name is Deutsche Post, parent company of package delivery outfit DHL. Fedex and UPS aren't too happy about this. (I'll point out another, non-German-specific one, with the caveat that I'm not a disinterested observer. That's Airbus vs. Boeing. The argument there is not just that Airbus can afford to take risks that Boeing can't take because Airbus' solvency is guaranteed by the French and British governments. It's that Airbus can engage in business practices (e.g., the Emriates order) that are illegal for Boeing.)

[wenk]

This months edition of the magazine of the German Metal Workers Union has a cover depicting the vicious American Capitalist Locust.

Red Green needs multipurpose scapegoats such as the metaphorical insects to pursue its mission to turn Germany into a sink-or-swim society in which the only force which can come to rescue the poor are Islamic charities. If Economic Superman is depicted as an insect, it is only a little step to call Economic Girlieman a parasite too, and treat them both accordingly and make all good serfs rejoice. Never mind that the real robber barons of this world are the Islamic oil ticks and their imams, who are eager to invest in European welfare to build up their terror-frontend organisations.

[Lou Minatti]

You know what the most ironic aspect of this is? It's that the German government is spending lots of money taking out full-pages ads in major US newspapers featuring Bush and Schroeder and informing American readers how important our relationship is. Where did I read that? Oh yeah, I remember.

http://medienkritik.typepad.com/blog/2005/04/whats_the_defin.html

So the SPD is telling Germans that the US sucks and is the source for their problems, while the SPD is telling Americans that "Hey, we're your friends!"

Perhaps the SPD is suffering from a collective form of schizophrenia?

[Pogue Mahone]

Lou - its just that even in this day and age too many are unaware that the world is a much smaller place than it was even 10 years ago

Thats why you have the Dixie Chicks blasting George W in London in a way they would NEVER do in the USA

Oh, the Dizie Chicks can say whatever they like, its a free country, the point is that they were smart enough to keep their opinions to themselves until they went abroad - then they let loose for oversea's domestic comsumption

Well they got cheered in London - and pretty much ended their careers when the news hit the USA

Countless other examples

So Schroeder will just have to learn that when you say X in Germany and Y in Miami - somebody will blab and whole thing will blow up in his face

[wenk]

Lou, that ad is ridiculous. Have a cloose look to GWB's right shoulder: This is a picture where Bush is pointing to the horizon. They've cut the gesture off the picture, but the eyes of both men are on that finger. Maybe it's the only picture from the whole Mainz visit on which Schröder makes a sufferable face. In any case, when the German lobby puts affiance announcement style ads to promote our relations, I think the message to Americans would be expect a romantic understanding of diplomacy in the current government.

[Christian]

Laurence

" Has anyone heard within Germany or does anyone foresee any indications of near-future German government restrictions or possible government confiscations of the personal investments, savings and holdings in Germany held by foreigners? "

The answer is NO for the near future. The social democrats are using all this anti capitalist rethoric to win a state election later this month. This state is a stronghold they ruled for 38 years and now they're far behind in all the polls. They can not afford to lose this state , after already losing most other states during the past 6 years and the majority in the Bundesrat, the parliament that represents the 16 German states.
I don't think this " last hope " campaign to mobilize their base will be successful, in fact I think they will lose the state of Nordrhine Westfalia and the general election next year by a great margin.
If I'm wrong and German voters really fall for this rethoric on May 22 I would be worried and would advice foreign and domestic investors to reduce their investments in Germany. This might be the most important German state election of all times , because it will decide in which direction the country is heading in the years to come.

[johnrosenthal]

Just a detail, but I have to disagree with Joe N.'s and Ray's assessment of the usefulness of the FT article. I mean the first one mentioned, the news item, not the Munchau opinion piece. It's useful in the sense that it's at least something in English, but by foregrounding the token German members of the SPD "list", it obscures the xenophobic and, more specifically, anti-"Anglo-Saxon" tone of the SPD campaign. The FT has to know who the firms are, so this a real gift to the SPD and the Schroeder government.

Also on the SPON's point about there being Jewish anti-capitalists. Frankly, what is the relevance? Marx, for example, was, if you want, "ethnically" Jewish. But his father was a Prussian civil serveant who had converted to Protestantism. More to the point, his own writings are full of anti-Semitic jibes, making exactly the sort of association of "money-making" and "Jewishness" that generally is in play when "anti-Capitalist" rhetoric veers into anti-Semitism. I am not only talking about the hyper-philosophical very early text (Marx wrote it when he was 25) called "On the Jewish Question". The more telling remarks are found in Marx's "mature" work: in Capital.

[Gottfried]

Hello everyone:

Put me in the camp which thinks that Germany is basically doomed. It will come out of this crisis, but no one knows how: and that is a recipe for disaster.

First, the demographics argument (Germans are not having children, yet want to limit immigration) is convincing. There is simply no way to provide for the next twenty or thirty years of social benefits which Germans expect and accept as fundamental to their society. SOMETHING must give. Democracy, perhaps? It's happened before.

Second, even radical economic reforms are not enough to significantly lower employment. I see two problems which are seldom, if ever, mentioned:

1. Trade unions, guilds, and the basic social mindset make meaningful work nearly impossible without formal, recognized training. Lost your job as a plumber and are thinking about becoming an electrician? Three years "re-training", a good portion of which includes taking classes at school along with the 16-19 year-olds. You do it, however, but still don't find work as an electrician. Want to just do some plumbing or electrical work on the side to pay your bills? Not allowed. Want to risk it? You'll be outbid by some Pole or Russian who will do it for less. (The employment market is, therefore, completely artificial. Official statistics are almost meaningless because of the black market.) Government sponsored solutions will never be enough until they recognise the need for people to go to work without a three-year re-training, for people to be recognised for skills and abilities rather than the piece of paper they carry around in their pocket.

2. There is a very, very deep malaise among the unemployed and young people which cannot be easily documented other than anecdotally. But it is there. Grab a 17 year-old off the street at random and ask what they plan to do with their life, and they DON'T KNOW. Okay, you say, the average 17 year-old American doesn't know either. BUT: the average 17 year-old American can go get a job for experience or head off for college with the expectation that they might get a job other than that for which they study. The American teenager can expect a market flexibility which not only does not exist in Germany, but which could not be created within the next decade EVEN IF everyone agreed on its utility. The German 17 year-old does not have this opportunity. First, he has already been channeled in one way or another by having attended either Gymnasium, Haupt/Realschule and must live with the consequences. Changing tact is very difficult. And again, anecdotally, a malaise has already set in anyway: he knows he's got a good chance of not getting a job regardless of what he trains for.

Go to a Berufschule and ask around: what kind of job are you planning to get when you finish. Should be clear, shouldn't it? After all, they are attending a specific "Schulform" for a specific career, say "care of the elderly." But take my challenge: go to a Berufschule and ask around. You'll find that a great number just "picked something" and have no idea whether they want to do the work or can even find work in that area. Go to those who are studying "Wirtschaft" and ask around. Nothing. Blank faces. Malaise. They've already been beaten: if they had really hoped to get white-collar jobs in business they should have gone to Gymnasium, maybe even to university afterwards to get the cookie-cutter standard degree to become a "Kaufmann". But no, they are in the Berufschule and they have no idea what they're going to do. They don't even know what "Wirtschaft" means.

You could also take my word for it instead of asking around. I teach at a Berufschule, and I've done the asking and seen the blank faces. And for me, comparisons between the U.S. and German unemployment figures and growth and whatever economic analysis you have to offer is simply superficial. The truth is deeper: the economy is not just legally but culturally and morally stuck in a rut of inflexibility, frustration, and malaise, regardless of what numbers you choose.

[ulrich speck]

@ Gottfried
Very good points. I agree entirely. The greatest problem is the lack of chances. People are full of fear, they see no hope. No way to go. I guess this is called depression. Great depression.

[Pogue Mahone]

Gottfried - great comments. This is why the Blogosphere is THE place to get your news

Of course one has to do a lot of filtering and analysis to determine what is real and what is fiction - but the same is true of the MSM

And you don't get to shout "SOURCE PLEASE" at the CNN talking head and get a response :)

[Laurence]

Christian
thanks for your personal insight to Germany and thanks for your reply.

Bloomberg also replied - but not just to me.

http://www.bloomberg.com/apps/news?pid=10000100&sid=a2zTH_gFMUrM&refer=germany

[Joe]

In summary, then let us say.....

The US is in a state of decline.

Germany is on the rise....

Happy?

[Tyranno]

I have German friends who haven't worked in almost four years now. They don't give the impression of making any serious effort at trying to find a job either. And still, every summer they take a 30 day vacation, usually in the bad ol' U.S.A. (Florida seems the preferred state)

My saddest observation is that there isn't a politician in sight (France or Germany)that has a vision to really effect change. Instead they are like the democrats in America, defending their privileged positions and paychecks and offering the people pablum and scapegoats.

As some said when Bubber Clinton was elected a few years back . . . you get the government you deserve!
But even Bubber, with all of his tremendous faults, when he needed a negative counter focus for his election prospects, demonized the other political party, not the Germans (Amis), or blacks (Turks), or Jews (Jews)! ! ! The other POLITICAL PARTY!!!
Imagine that, an Amerikanisch Arkansas redneck less filled with victimized bile and zenophobic hatred than the leaders of the complex and sophisticated SPD.
It is getting harder and harder to sustain the preferred image in all too many German's minds of the "stupid," "redneck," "money-grubbing," Amis," . . . given the day to day reality of their own country.

Tyranno

PS: Schroeder and Muentefering are succeeding magnificently. An American friend is closing up his computer company (30 employees) in Stuttgart and moving it back to America. " Getting to be too difficult to do business here," he says.
As people are discovering in the U.S.A. liberals aren't so much about helping the little guy as they are about maintaining the PARTY and it's grip on power. Like Union bosses ~ they alwasys get paid.