When the global economic crisis began in 2008, many commentators predicted Germany would be among the worst hit. As I show in this article — first published in the American Prospect — Germany has in reality excelled not only in maintaining jobs but in boosting exports.
American and British commentators have told three stories about the German economy over the past decade, all of them derogatory. Articulating a standard conservative view, Adam Posen of the Peterson Institute for International Economics in 2006 characterized Germany’s performance as “lastingly poor.” In a similar vein, Jude Blanchette, blogging for the libertarian Mises Institute, predicted in 2003 that nothing but “rot and indolence” lay ahead. Another version of the indictment states that even though Germany was once an economic powerhouse, its best days are over. Thus in 2003, Larry Elliott of the
Guardian reported that the German economy had “sputtered to a virtual halt” and, in the view of many, had succeeded to Britain’s 1970s-era role as the “sick man of Europe.”
A third story holds that, to the extent Germany is surviving at all, it is only by giving up the distinctive elements of its economic model and embracing American norms. Edmund L. Andrews, for instance, claimed in the New York Times in 2000 that “the structure and ethos underlying Fortress Germany have begun to crack like a house on a California fault line.” Supposedly the Germans were taking a leaf out of Silicon Valley’s book by moving to a freewheeling employment model, and many recent university graduates were forsaking a secure, carefully nurtured career with a long-established employer for a bumpier ride with an entrepreneurial start-up.
