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Getbig Main Boards => Politics and Political Issues Board => Topic started by: OzmO on May 31, 2011, 10:31:12 AM
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http://www.alternet.org/economy/151082/there%27s_a_right_way_and_a_wrong_way_to_deal_with_a_jobs_crisis_--_why_is_germany_doing_it_so_well/ (http://www.alternet.org/economy/151082/there%27s_a_right_way_and_a_wrong_way_to_deal_with_a_jobs_crisis_--_why_is_germany_doing_it_so_well/)
There's a Right Way and a Wrong Way to Deal With a Jobs Crisis -- Why Is Germany Doing It So Well?
Germany's success indicates that one way to fight unemployment would be some modest efforts to give U.S. employers incentives to cut hours, not workers.
May 30, 2011 |
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.
For most of the 2000s, Denmark had what was arguably the best labor-market performance in the world. Unlike most European countries, unemployment rates were at, or even below, US levels, and employment rates (the share of the population holding a job) were well above those here. Denmark managed this while offering high wages and comprehensive benefits such as health care, paid sick days, paid family leave, and union representation.
Denmark's success is widely attributed to its "flexicurity" system, which provides flexibility to employers and security to workers. Flexibility comes in the form of limited job protections for workers. In the United States, private-sector workers have almost no legal rights to their jobs and, absent a union contract, can legally be fired for almost any reason. In Europe, however, workers have a range of legal protections against dismissal. Denmark has more protections than we do here, but noticeably less than workers in the rest of Europe.
Danish workers accept less job security because they know that national unemployment benefits are generous and the system spends real money getting unemployed workers into new jobs. This is the "security" half of the "flexicurity" system.
A key part of this system is a set of programs that provides training, education, job-search assistance, and other services and incentives to unemployed workers. Even before the Great Recession, the Danes spent over one percent of GDP on these activities. In the United States, we spent less than one-tenth of 1 percent of GDP on comparable programs.
Flexicurity worked well when the Danish economy was booming. Training, education, and help matching the jobless to vacancies work well when there are plenty of jobs. These same policies, however, have limitations when there just aren't enough jobs: the unemployment rate in Denmark, which was just 4.0 percent in 2007, has been rising steadily since 2008, and now stands at 7.8 percent.
The Danish experience is a cautionary tale for the United States because it has become fashionable here to argue that our current unemployment is "structural." That is another way of saying that high unemployment is largely the fault of the unemployed themselves, either they lack the necessary skills or are unwilling to relocate to where the new jobs are.
But, Denmark already does far more than we could ever hope to do here to provide training, education, and other supports to the unemployed. If unemployment were "structural," the Danish response would be near perfect. Their approach has not made a noticeable dent, however, because unemployment there, like here, is the result of deficient demand, not a deficient workforce.
There is an economy, however, that has figured its way around the Great Recession. Unemployment in Germany is lower now than it was before the downturn (not to mention lower than in Denmark, now, too).
Germany has done well because its labor-market institutions encourage employers to cut hours not workers. Instead of laying off 20 percent of workers, say, a firm can instead lower the average hours of its employees by 20 percent. Both accomplish the same goal, but from a social point of view, cutting hours is much better because it shares the pain more equally and keeps workers tied to their jobs.
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Great post. Would love to see some progressive models like that here. Unfortunately you either have unions that won't budge or employers that won't budge. It's a stalemate that has led to a major decline in employment conditions compared to elsewhere.
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Here is the very simple issue the far left progressive communist pieces of trash in this country dont get - the average guy in the USA who goes to work is obscenely overtaxed thereby leaving no real discretionary income to purchase anything.
And as far as employers go - please - between the EPA, EEOC, tort lawyers, workers comp, payroll taxes, property taxes, etc etc, no one is going to take a chance now here. I deal with businesses every day and here the same thing over and over and over and over and over and over - employers are shedding overhead, shedding employees, offshoring production, and just trying to keep a piece of the middle.
Its not only cost, but legal exposures as well. Who the hell is going to hire anyone when you risk PI lawsuits, discrimination lawsuits, frivilous workers comp claims, EPA insanity, property taxes skyrocketing, etc etc?
Funny too - I called this from day one and yet three years later - the progressive morons are still scratching their heads why things are still in the toilet with no end in sight.
We dont need to emulate Germany - we need to shrink the govt by 50% at least, and tell all the enviro busy bodies, big govt fascists and meddlers, and other brighted eyes delusional leftists and "progressives" to drop dead and die.
Until then, we will stay mired in depression.
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Hahaha oh please. Listen to your nonsense. Such bullsh*t. People like you are the reason we don't have a progressive system. And why we have what we have.
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Hahaha oh please. Listen to your nonsense. Such bullsh*t. People like you are the reason we don't have a progressive system. And why we have what we have.
ha ha ha ha - yeah ok KC - whatever.
Tell me the business you started, created, ran, and had responsibility for paying bills for?
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Just so you're aware 333 both Germany and Denmark have higher wage taxes than the US and yet guess what? Their economies are better hahahaha eat sh*t with your discredited bullsh*t.
Bring on the Danish-German progressive model!
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Just so you're aware 333 both Germany and Denmark have higher wage taxes than the US and yet guess what? Their economies are better hahahaha eat sh*t with your discredited bullsh*t.
Bring on the Danish-German progressive model!
Oh yeah ok KC - keep telling yourself that. Its the overall situation.
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More on Denmark and their environmental policy -
How, then, has Denmark been so successful in managing its carbon emissions? The answer lies not with the source of power, but with the price of power. At 30 cents per kilowatt hour, electricity costs anywhere from three to five times what the average North American would pay. And, not surprisingly, Danish households consume a fraction of the power that we do.
Depending on how many horses are under the hood, Danish car buyers pay a tax ranging anywhere from 100 to 180 per cent of the sticker price of the vehicle. In other words, when you purchase a car in Copenhagen, you can pay almost as much as if you were buying three cars in North America.
Hahaha and their economy is not tanking? huh? Isn't that enviro-nazi policy that would crush any economy?
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Oh yeah ok KC - keep telling yourself that. Its the overall situation.
Just face it. European 'welfare' states have done better than the model we currently have.
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They have 8 million people in a largely homogenous population moron. You can't apply what works for 8 million people to 310 million people.
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Just face it. European 'welfare' states have done better than the model we currently have.
Yeah ok - how about you pick up a newspaper moron. The EURO is about to disintegrate and Germany is ging to have to bail out greece again.
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They have 8 million people in a largely homogenous population moron. You can't apply what works for 8 million people to 310 million people.
So you can't take anything from their approach at all? Not one thing? Weird.
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Just face it. European 'welfare' states have done better than the model we currently have.
You like the European model so much, then move there.
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Yeah ok - how about you pick up a newspaper moron. The EURO is about to disintegrate and Germany is ging to have to bail out greece again.
Greece is denmark? ???
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You like the European model so much, then move there.
Wow great rebuttal Aristotle
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Wow great rebuttal Aristotle
Well its so great over there, why are you still in the US? Seems to me there is nothing to discuss, in your opinion Europe great and the US sucks.
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Just so you're aware 333 both Germany and Denmark have higher wage taxes than the US and yet guess what? Their economies are better hahahaha eat sh*t with your discredited bullsh*t.
Bring on the Danish-German progressive model!
As someone who has lived extensively in Germany, I can tell you it will never happen in the USA.
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Greece is denmark? ???
The problem with people looking at Denmark is that they seem to overlook the fact that Denmark is essentially a small American state, that is to say, what occurs there occurs at what would be the American equivalent of the state federal level. It WOULD be doable at the state level but in order to achieve it you would need to get Washinton out of it and allow individual states to decide how they want to work with and allocate their budgets.
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33333 it doesn't seem like you have much in the way of concrete counter points other the same old blabber used to rally the crowds.
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33333 it doesn't seem like you have much in the way of concrete counter points other the same old blabber used to rally the crowds.
::) ::)
Do me a favor - go talk to any business person and see the answers you get and tell me if they are more alng the line of what I say or of what the hard left morons say.
Serious - walk down the street and walk into a small business and tell me what their biggest issues are.
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33333 it doesn't seem like you have much in the way of concrete counter points other the same old blabber used to rally the crowds.
As I said; the size of Denmark is the key and it would be plausible on a state level but it would have to be managed by the state without any Washington interference. The Swiss Canton system is another one that is comparable.
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They have 8 million people in a largely homogenous population moron. You can't apply what works for 8 million people to 310 million people.
Denmark has even fewer people than that, maybe 4.5 but it is a good point.
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::) ::)
Do me a favor - go talk to any business person and see the answers you get and tell me if they are more alng the line of what I say or of what the hard left morons say.
Serious - walk down the street and walk into a small business and tell me what their biggest issues are.
So I will take that as a "no, i can't because all i can do is be an ignorant tool"
BTW, I have been involved in small business all my adult life and many of my friends are small business owners.
FACT: Its fucking working over there.
Maybe you should remove the stick up your ass for a new york minute and look objectively at what they are doing an maybe come up with some ideas of how it can be applied to the USA.
Oh wait you can't do that because you are too busy looking for Obama's next gaffe. ::)
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As I said; the size of Denmark is the key and it would be plausible on a state level but it would have to be managed by the state without any Washington interference. The Swiss Canton system is another one that is comparable.
Good luck with that with any administration.
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Good luck with that with any administration.
It would be necessary. Local needs are better accommodated by local administrations. Business needs might be different in say, New Hampshire or Utah, a local government could deal with those needs better. Of course it is ideal but we did start out as a Federalist nation.
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Strange the more Federal Government intervention we get into things that are not in its constitutional mandate, the worse things get, very strange indeed.
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So I will take that as a "no, i can't because all i can do is be an ignorant tool"
BTW, I have been involved in small business all my adult life and many of my friends are small business owners.
FACT: Its fucking working over there.
Maybe you should remove the stick up your ass for a new york minute and look objectively at what they are doing an maybe come up with some ideas of how it can be applied to the USA.
Oh wait you can't do that because you are too busy looking for Obama's next gaffe. ::)
What they are doing there is something that wont work here for a variety of reasons, none of which 50% of this country is willing to accept for a variety of reasons.
Second - again - you can't apply what works for a nation of 4 million homogenous people and think it will work here. that is beyond insane for so many reasons its not funny.
And guess why what we are doing now is not working? Sadly - the answer is not something you are willing to accept so instead you are looking abroad when the answer is right here.
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Strange the more Federal Government intervention we get into things that are not in its constitutional mandate, the worse things get, very strange indeed.
No way, you Reagan loving, low tax wanting mouth breather!
Your above statement only proves that things suck and things are getting worse because there isn't enough government intervention!
Duh, Mr. SillyPants!
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Just face it. European 'welfare' states have done better than the model we currently have.
Really? You named two. I can name five right off the top of my head that have failed SPECTACULARLY. And it lines up in a nice acronym, to boot. PIIGS.
Typical rat dem bending examples to suit his stupid fucking agenda.
You know why the Germans make it work? Because they're far and away THE hardest working people in Europe. And it's why polling shows that over 3/4 of them are against bailing out any of the disgusting lazy, socialist PIIGS that wouldn't know a hard day's work if it punched them right in the face.
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Like many of us have said bamas goal is to collapse the economy and have people begging for socialism.