German/American Relations

America learning from the German Economy

By: Brian Becker

1090-012

Statistics:Statistics:

Germany is Germany is beating the U.S. beating the U.S. in nearly all in nearly all levels of levels of economic economic development. development.

Statistics (Cont.):Statistics (Cont.):

America loses approximately 200,000 jobs each year, America loses approximately 200,000 jobs each year, leaving them with a current leaving them with a current

Germany boasts a shocking trade surplus of the Germany boasts a shocking trade surplus of the equivalent of $158 billion, compared to the U.S. deficit equivalent of $158 billion, compared to the U.S. deficit of nearly $600 billion.of nearly $600 billion.

German Model:German Model:

Focuses primarily Focuses primarily upon exporting upon exporting goods to the ever goods to the ever growing Chinese growing Chinese companies. companies.

Their focus on small Their focus on small business, and business, and German-made German-made products allows products allows their economy to be their economy to be self sufficient.self sufficient.

German Model (Cont.):German Model (Cont.):

The german idea of The german idea of Kurzarbeit Kurzarbeit allows companies to hold onto allows companies to hold onto skilled workers in times of skilled workers in times of economic instability.economic instability.

This idea makes the company This idea makes the company suffer in short term profit, but suffer in short term profit, but allows them to keep skilled labor to allows them to keep skilled labor to continue investing for the future.continue investing for the future.

U.S. Model:U.S. Model:

Today, only 9% of Americans work in factories, Today, only 9% of Americans work in factories, preferring instead to import products. preferring instead to import products.

The loss of jobs to foreign workers has led to an The loss of jobs to foreign workers has led to an increase in unemployment (currently 8%), and thus increase in unemployment (currently 8%), and thus a weaker economy.a weaker economy.

How the U.S. is How the U.S. is Adapting:Adapting: The U.S. in the long run has done The U.S. in the long run has done

very little to adapt, but think very little to adapt, but think tanks have been created to look tanks have been created to look into future policies. into future policies.

The U.S. has begun looking into The U.S. has begun looking into government and state support for government and state support for research and development of new research and development of new production policies.production policies.

Questions:Questions:

To whom does Germany focus its To whom does Germany focus its exports?exports?

Is the U.S. ahead, or behind Is the U.S. ahead, or behind Germany in foreign trade?Germany in foreign trade?

Answers:Answers:

ChinaChina

BehindBehind

Sources:Sources:

http://www.spiegel.de/internationhttp://www.spiegel.de/international/business/0,1518,822167-2,00.hal/business/0,1518,822167-2,00.htmltml

http://www.fas.org/sgp/crs/row/R4http://www.fas.org/sgp/crs/row/R40961.pdf0961.pdf

http://articles.latimes.com/2012/jhttp://articles.latimes.com/2012/jan/22/business/la-fi-germany-midan/22/business/la-fi-germany-middle-class-20120122dle-class-20120122

Culture Photo:Culture Photo: