Monday, May 30, 2011

There's a Right Way and a Wrong Way to Deal With a Jobs Crisis -- Why Is Germany Doing It So Well?

Photo from Henry Work as seen at Alternet
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The Great Recession hit harder in the United States than in most of the rest of the world. Among the world's rich economies, we experienced the third largest increase in unemployment, trailing only Spain and Ireland. Most advanced economies saw substantially smaller increases in unemployment and one --Germany-- actually saw its unemployment rate decline.
Can we learn anything from countries that weathered the Great Recession better than we did? The experience of two countries --Denmark and Germany-- seems particularly informative. Denmark had a model labor market before the downturn, but ironically, offers a cautionary tale. Germany's economy has been up and down since unification in the early 1990s, but points one way out of our mess.

1 comment:

  1. I had a great conversation with a 30-something german in the US doing software work a few years ago, about their state of political affairs compared to ours. The younger generations were (are) royally pissed off because the german government was extending their retirement age, cutting benefits, reducing PTO, the whole nine yards. The older, conservative population was okay with it, as their positions were secure, but the up and coming population would inherit significantly less than their predecessors. Germany was beginning the process of restructuring their governing economy. "Americanizing" is what they called it, in a derogatory manner.

    So just like in the USA, we read about little ups but only after big downs.


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