Free Markets, Free People

Musings, Rants and Links over the 18th Fairway:03/16/2010

The French Finance Minister has noticed that the disparities within the European economy are causing a number of issues, and fingers the….Germans!

“Clearly Germany has done an awfully good job in the last 10 years or so, improving competitiveness, putting very high pressure on its labour costs. When you look at unit labour costs to Germany, they have done a tremendous job in that respect. I’m not sure it is a sustainable model for the long term and for the whole of the group. Clearly we need better convergence.”

You see, having an economy so efficient that you can be more competitive than your neighbors with high wages and a high standard of living means you need to change so that the French, Greeks and other assorted PIIGS can continue down the path they have chosen. The Germans are just too darned efficient for the greater good.

In the interest of being helpful I have identified several important initiative’s that the Germans should adopt to align themselves more fully with their neighbors.

  1. Do not keep your debt levels below 3% of GDP…ever.
  2. Encourage massive strikes at the drop of a hat.
  3. Make public services far more attractive than working in the private sector, with massive  strikes and riots to keep it that way.
  4. Make it almost impossible to layoff anyone for any reason.
  5. Mandate at least six weeks paid vacation for every employee.

That should make sure your economy is not too efficient.

Is China’s economy about to rollover?

I won’t explain this, just let it sink in:

I don’t think it will be as bad as Japan, but the evidence isn’t giving me any great comfort either.

I love Apple, and I love my iPhone. Still, is Apple really worth more than Walmart? Or these various baskets:

  • 4x the global smartphone market
  • 5x the global music market
  • 100x the global smartphone app market
  • Enough to buy HP, Dell and Hitachi, with mad money left over for Xerox or Seagate

Yep, that whole efficient markets hypothesis may take a beating again.

Did any of you see Michael Lewis on 60 Minutes Sunday? If you didn’t, I highly recommend it.


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Cross posted at The View From the Bluff

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15 Responses to Musings, Rants and Links over the 18th Fairway:03/16/2010

  • Lance PaddockIs China’s economy about to rollover?

    喬治·布希應該承擔責任。(It is all George Bush’s fault.)

    As for the German economy… I’ve dealt with Germans, and I must say that my view of teutonic efficiency and work ethic took a nasty knock as a result.  If they are that much better than the rest of the Euros, I think it’s more a statement of how much more lazy / inefficient the French, Italians, et al are rather than how much better the Germans are.

  • The Germans have at least five weeks paid vacation, a health care plan (not single payer), and a functioning social welfare system.  The quality of life is quite high — the Germans are rich, yet they also get decent vacation time and social protections.  Americans are driving themselves (literally) crazy — anxiety, stress, poor eating habits, and massive consumption which has led to personal debt of $60 trillion (the Germans still save) — with a materialist ethic that seems to think making money (and then consuming) is everything.   That’s one reason why I expect Europe to rise ahead of the US in the next century (perhaps developing European partnerships with China, Russia, maybe even Mideast countries).  The Atlantic alliance may be a 20th century phenomenon.   The US, on the other hand, is likely to  look more towards SE Asia and its own partnerships with India and China.   The geo-economic shifts taking place now (matched by geo-political ones) are pretty amazing.

    • That’s one reason why I expect Europe to rise ahead of the US in the next century (perhaps developing European partnerships with China, Russia, maybe even Mideast countries).

      It’s cute that you think somehow Europe will become more like Germany, and not more like Greece…
       
      Erb, I know you don’t get it, but France wants Germany to be less productive and profitable, not help them find a way to do as Germany has.
       
      And those weeks and weeks of vacation time?  That’s voluntary, not mandated.  It’s private-sector actions to attract the best.  Companies who only offer 4 weeks lose their best employees to companies with 5 weeks.

    • A health care plan with lower quality of care than the US, less fairly distibuted access to care than the US, and a cancer survival rate that would equate to over 175,000 additional Americans dead every year. That’s 40 times the number of dead for the entire war in Iraq. Every year. Just for the political convienience of being able to say we have a plan.

      • The thing is, the left does not care about actual lives, certainly not American lives.

    • Germany’s per capita GDP is $34k, in 22nd place, while the US is in 6th place at $49k. We are richer.

      We also protect Germany and the rest of Europe, if we in fact decay, they are fu*ked. At best, they would have to step up military spending while watching trade tank (and they would have to significantly reduce their welfare state to do this), at worst is will be literal.

      Your problem, Erb, is that your views are wrong, and you have to ignore reality in order to hold them.

      • Am I recalling this wrong, or didn’t the German government become near apoplectic when Bush hinted at the possibility of withdrawing US troops that were in Germany?  I vaguely remember a news article explaining that Germany stood to lose something like $1 billion a year, not counting the money they would need to spend (and the troops they would need to spend it on) to replace the near 50,000 US personnel.

        • I am not aware of that, but it does make sense.

          I am more thinking in terms of naval dominance. The German economy is dependent upon commerce that is much more efficient due to the US dominance of the world’s oceans.

          I don’t think Germany would face any sort of immediate domestic threat is the US withdrew ground forces from Europe, but if our navy becomes less capable all of Europe will suffer. They will have to poney up the money to increase their navies, and that effort will still fall short. The costs involved in international trade will increase. The bad guys will get bolder.
          The modern world is the place it is, the place of global trade and a golden era, because of over 200 years of Anglo-American naval dominance.

    • You are a tool of your own ego.

    • The Germans have at least five weeks paid vacation, but I hope you forget that German unemployment is chronically high. It tends to hover around 9%-10% even in good times. It’s currently 9.1%, which is less than U.S. unemployment, but that’s only because of a government scheme that allows workers to work 1/2 their normal hours for 80% pay, and companies are paid subsidies for that 30% pay that Germans aren’t earning. Oh, and who pays the subsidies?

      Germany has a fine health care plan and a functioning social welfare system, if you’re the ones who don’t have to pay for it. The mandatory health insurance is so awesome that 15% of Germans go for private insurance, rather than risk their lives waiting for a government-paid doctor.

      The quality of German life is quite high…when you compare it to France. The Germans are rich and get social protections, because they don’t have to budget for a military. You’ll never hear Germans saying “Yankee go home,” das ist zweifelsfrei! Now, Germans do get lots more vacation time than Americans, but I refuse to admit it has any correlation with Germany’s lower GDP per capita and structurally higher unemployment. Leftists like me find it simply impossible that people will have a harder time finding work if they must be guaranteed lots of paid time off.

      Americans are driving themselves, and hopefully it won’t stop because God knows Europe wouldn’t have the balls or ability to stand up to the militaristic Russia that Putin is restoring. Oh and when I tell you that Americans have personal debt of $60 trillion, I don’t know if I pulled that number out of the air or out my butt, but you should know it’s baloney. According to the Federal Reserve’s flow of funds report, outstanding U.S. household debt was $13.5 trillion at the end of 2009. And I don’t want you to know that it’s against over $60 trillion in assets. Households and non-profits had $68 trillion in assets at the end of 2009, and though there aren’t numbers on non-profits’ assets in 2009, they had $2 trillion in 2000. So “over $60 trillion” is safe to say.

      Americans are materialistic, which gives them the drive to produce more so they can buy more. Thank goodness for them, really. Germany and France just couldn’t depend on other trading partners.

      I and the rest of the America-hating American left would love nothing better than for European socialism to dominate. We can’t stand a second century of American dominance because it would prove that capitalism is the only way to go.

  • Considering France’s history with German, if I were any sort of French government official, I would start every day with one thing in mind: “How can I keep Germany from noticing us?”  I sure as hell wouldn’t actively try and annoy them…
     
    The streets of Paris are still lined with trees, after all…

  • You see, having an economy so efficient that you can be more competitive than your neighbors with high wages and a high standard of living means you need to change so that the French, Greeks and other assorted PIIGS can continue down the path they have chosen. The Germans are just too darned efficient for the greater good.

    >>>  This time, if they want to try to militarily conquer the continent, they’d be justified.