Taking An Economic Lesson From Germany

Harold Meyerson looks at the differences between the U.S. and German manufacturing sectors (via Mark Thoma):

Of course, if you listened to the Republican presidential candidates’ debate this week, you’d conclude that the way to revive the economy generally and manufacturing particularly is simply to deregulate business and eliminate its taxes. (This is also the Republican remedy for measles and gout.) Throw in the defunding of the National Labor Relations Board, which Newt Gingrich advocated, and you’d get an economy that competed with Asia’s low-wage manufacturing regions. They’d pass us on their way up; we’d pass them on our way down.
Fortunately, that’s not the only economic model out there. For a growing number of economists, pundits and even the occasional CEO, Germany offers lessons in how an advanced economy can compete globally and actually raise, not lower, its living standards.
In a March paper for the Council on Foreign Relations, Nobel laureate economist Michael Spence and New York University researcher Sandile Hlatshwayo argue that Germany’s success at building a booming manufacturing sector that constitutes almost twice the share of the economy that ours does is largely the result of “a broad agreement among business, labor and government” to keep wages competitive and high-value-added production at home. Leslie Gelb, former president of the Council on Foreign Relations, also attributes Germany’s overwhelmingly positive trade balance and comparatively low unemployment rate (7 percent) to that tripartite system. David Leonhardt, the New York Times economics columnist, wrote last week that Germany owed its edge in global competitiveness to a range of policies that could not be more different than ours: limiting homeownership, improving education (including vocational and technical education) and keeping unions strong — which is why “middle-class pay,” he noted, “has risen at roughly the same rate as top incomes.”
This growing appreciation of the German model is a welcome change from the laissez-faire approach to globalization that has dominated U.S. policy and discourse for decades, dooming many Rust Belt denizens to lives of crystal meth and quiet desperation. But some of these analyses still understate the crucial distinctions between Germany’s stakeholder capitalism, which benefits the many, and our shareholder capitalism, which increasingly benefits only the few.

I think the shot about the Rust Belt hits below the belt.  The whole article is very interesting.  Don't expect U.S. business approaches to change.  American politicians are only concerned with placating the rubes with the minimum real benefit necessary while further enriching those at the top.  Marx's home may be amenable to balancing labor and capital but in the United States, labor is shunted to the corner.  Capital always wins.  The Republican party caters to every whim of the interests of capital, while the Democrats mouth platitudes to labor while winning table scraps for the masses as compromise with Republicans in catering to capital.  Money talks, bullshit walks.  Republicans have snowed the middle class into believing that government is the enemy and business is the friend of the middle class.  Nothing could be further from the truth.  Watching the Republican candidates and the U.S. Chamber of Commerce, it is perfectly clear who will win, and it won't be the lower 90% of the American populace.  Check out the tax proposals of Tim Pawlenty and Paul Ryan. I'll be sitting on my pile of capital, pissed off at the world, but I'll keep getting richer, without laboring much.  Pass me a beer, I'm gonna have to be drunk for the foreseeable future.