June 15, 2011
"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
GermanyÂ’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.”