Sunday, March 30, 2014

The United States & Germany, A Tale of Two Economic Powers

Germany. It’s a nation of undulation. The rolling hills of a traditional European countryside can incite wonder into the previously unfamiliar. The mix of metropolitan modernity, and rural monarchical beauty, is quintessentially European. It’s a place where history—good, and very bad—intersects with the optimism of scientific and technological exploration.

As an American, it’s quite foreign to me. The cultural and legal intricacies employed to help furnish a better nation, can at a first glance, be puzzling. However, when I dug deeper, I began to see the adeptness that has made Germany the economic capital of Europe. I began to see a culture of bold practicality.

German Conservatism vs. American Conservatism

The immigration debate is a contentious issue in the European Union. In February, Switzerland passed a referendum mandating the cap of net immigration into their country, which has sparked controversy.
In Germany in 2012, there was a net gain in immigration by 370,000 people. To give some context, the population of Germany in 2012 was 81.917 million. That puts the yearly increase in immigration at 0.45%, which doesn’t seem like too much, but conservative Germans worry that if this migration rate is maintained, purely immigration related population expansion will cause a more than 3% increase in the overall population by 2020.
The argument is less if the population expansion will happen, but more along the lines of if that population expansion is a good thing? German conservatives argue that an increase in population will result in an increase of the workforce, which in turn will lower wages. They also worry that an increase in the demographically poorer migrants will result in too heavy a burden on the welfare state, which already consumes 57% of Germany’s annual total expenditures.

The German conservative position isn’t necessarily actionably true. Many studies show that immigration can help economies rather than hinder them, but that’s not the point I’m trying to make. The point is that German conservatives are making an economic argument against immigration, and not a cultural one.

The German conservative position on immigration comes from a completely different place than the American Conservative opposition to immigration. The American position can most evidentially be demonstrated by the controversial Coca- Cola Super Bowl commercial, in which people of all different ethnicities sang America the Beautiful. The commercial drew backlash from conservatives; former Congressman Allen West called it, “Truly disturbing”. Some might say that this is only the fringe element of the conservative opposition to immigration, but I’ve lived in Florida long enough to know that it really isn’t.

The backbone of the American opposition to immigration is cultural identity. It’s the longing for a nation that demographically stands still. However, the people throughout history who have taken this point of view have always been proven wrong, because America is, and always will be, a nation of immigrants.

The difference between American conservatives and German ones is that German conservatives think practically, and American conservatives think in terms of ideology—and politically, practicality will always get you further.

The Intertwining of the Poor, and a Progressive Recycling Policy

Since 1991, the recycling policy in Germany has stayed relatively the same. Over the years there have been stricter rules enforced, but the general application of the program has been quite uniform.

How it works is, when one buys a glass, plastic, or metal food or drink container, he pays a fee that is used as collateral for every recyclable item—in German this is called a “Pfand”. This fee typically ranges from 0.08 € to 0.50 € and is collected by the seller of the goods. When one brings back the empty bottle they purchased, they feed it into a machine that scans it and prints out a ticket that they can redeem for cash, or put towards their next purchase. Traditionally, what people do is bring back all of their empty bottles when they do their weekly grocery shopping, however this isn’t always the case, sometimes people forget to do this and throw their item away, or after parties and sporting events just throw it on the ground. This causes one of the most interesting social phenomenon I have witnessed.

An estimated 0.4% of the German population is homeless, which when compared to the US’ abysmal 0.6% isn’t terribly great. However, there is a major difference in the standard of living of the German and American homeless—next I will explain one of the reasons why.

When walking the streets of, let’s say Stuttgart—which is where I lived in Germany—I constantly saw homeless people looking in trashcans, and picking up any glass or plastic bottles off the floor. At first it didn’t seem all that unusual, but then I started to seem them opening locked underground trashcans—the sort that are fixed to the ground, in which the trash falls straight into an underground reservoir—and that got me curious.

I started asking locals what they thought about it, and the most common reaction was that they thought it was a good thing. One told me, “We are basically paying an army of homeless people to clean up our streets.” At this moment, I saw the genius of it. The “Pfand” was a lazy-tax. It directly redistributed money from the more well off, or middle-class, straight to the underprivileged, but only from the people that decided that the 0.25 € wasn’t worth taking the bottle back to the store for. It is essentially an opt-in tax that pays the homeless to clean the streets of litter. Nobody loses.

If the US were to pass a law that developed a recycling plan like Germany’s, it would reduce poverty, and help ensure that the streets of the US are as clean as some of Europe’s best.

Maternity Leave

In the United States, there is no federally mandated paid maternity leave. There is only The Family and Medical Leave Act of 1993, which allow mothers to take 12 weeks of unpaid maternity leave.

In Germany, mothers are allowed to take 14 weeks of fully paid maternity leave, and up to a full year of 60% paid maternity leave without the fear of losing their job. This program is federally funded and thus doesn’t do any harm to employers.

paper published by the Columbia Population Research Center at Columbia University entitled, “The Effects of Maternity Leave on Children’s Birth and Infant Health Outcomes in the United States”, says this about paid maternity leave:

“High female labor force participation rates in the United States call attention to the importance of maternity leave policies. Unlike men, women who have children must take at least some time off from working during childbirth. Hence policies that ensure their job security during this time period are crucial for women’s careers, health, and overall well-being. These benefits alone provide support for the enactment and continuation of maternity leave policies in this country.”

It goes on to say:

“Thus, if policymakers are concerned with decreasing disparities in child health and well-being between children of different backgrounds, they need to consider the fact that an unpaid maternity leave policy may actually increase disparities because it only benefits those mothers who can afford to take it. On the other hand, paid maternity leave policies (such as those in California and New Jersey) may allow poor, single and working mothers to care for their newborn children at home, to seek prompt medical care when needed, and to develop a closer bond with them, thereby saving their lives and improving their life chances from the start.”

This research makes the case for paid maternity leave. It essentially states that if we had maternity leave laws like many other wealthy nations do, then there would be a decrease in the infant mortality rate—specifically in underprivileged communities. How in America can we be so far behind on such a simple issue?

Infrastructure Development

I recently visited Germany for the first time since I moved back to America in late 2011, and the first thing that I noticed was the amount of new infrastructure development. I would walk around a street corner and see a brand new, magnificently modern building that wasn’t there just 3 years ago. There was construction everywhere, a new building here, a new train line there and a big 10- year project to revamp the main train station in downtown Stuttgart. I said to myself, “This is what a vibrant economy looks like!”

In America in 2011, there was a public/private infrastructure bill that would have approved roughly $60 billion in new infrastructure spending. It would have gone towards things like roads, bridges and rail transportation. At the time it seemed like a common sense bill that was widely supported by the American people. Unfortunately though, the bill failed in the Senate with a vote of 51 fore, and 49 against—which seems odd I know, but that’s how the Senate works nowadays.

If congress could get its act together and pass an infrastructure bill, we could start the process of rebuilding our ailing infrastructure. Maybe then, we could start recapturing the economic prowess we once had.

The Police

In 2011, the German Police only fired 85 rounds of ammunition in the entire year. Meanwhile in America, that count was eclipsed in one incident in Los Angeles when the police fired 90 rounds at a fleeing unarmed man.
I had an experience in Germany that anecdotally summed up the difference between the American and German police forces. I was standing in a popular square in Stuttgart, when I saw three police officers walking quickly past. My first thought was that they may be looking for someone, but it turned out they were just getting in line at the crêpe stand. They stood in line and got their crêpes while chatting. I got the feeling that they weren’t worried, the feeling that they were just enjoying there lunch break.

Whether the difference explained above has to do with the prevalence of guns in America, doesn’t matter, because the guns aren’t going anywhere for the time being. What matters is that Americans start to realize that the fear that our police experience, so we can help officers of the law do their jobs in a more effective manner.

Conclusion

America and Germany are both thriving economies, but we as Americans should learn from the workable policies implemented by Germany. We cannot be stubborn or naïve and think that we will be able to maintain our economic dominance and cultural influence without adopting some good ideas from abroad. We need to be the leaders in political and practical innovation; for if we are not, then China is waiting to take our place.

No comments :

Post a Comment