Saturday, 16 June 2007

Who deserves the credit for Germany's recovery?

GDP 2006 2.8% after a decade of stagnation
1 million people less on unemployment
3% rause in VAT will help to balance the budget
190bn trade surplus as germany is increasing its exports

Bundesbank
- Real wage cuts in form of longer working hours and wage cuts. Labour costs have fallen sharly in Germany in the last decade
- Corporate restructuring

Like the UK recovery of the 80s or the Dutch one od the 90sw, the german recovery has been in large part a matter of breaking labour's stranglehold on the economy.

All these changes are neoliberal

It is the changing reality of the economy that drives the changing philosophy and not vice versa.

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