“This German-bashing is getting tiresome. When Paul Krugman studied economics, he ranked at the top of his class. If his classmates bashed him for making them look bad by comparison, would he urge them to study harder? Would he give them lessons in how to study more efficiently? Or would he sabotage his own grades and lobby for grade inflation for his classmates?“ (anonymous comment in the NYT)
ItÂ´s time again: Germany is in the dock. It is accused of having too high current account surplus – and not for the first time. The American Ministry of Finance and the IMF denounce, the EU-Commission still wants to investigate. With their continuous surpluses, the Germans were not only like an axe upon the Euro, they also destabilised the world economy – along with the Chinese and Japanese. The charged German firms are unaware of having done anything wrong. They make an effort to make their products internationally competitive. A productivity-oriented wage and collective-bargaining policy and a strong flow of marketable innovations make German firms unpleasant competition on the world markets. They are particularly successful with their investment goods. Here in this country, mercantilist instruments that favour exports and hinder imports are applied not more than anywhere else. With the Euro, Germany has relinquished the instrument prone to manipulation – the exchange rate. No wonder that German employers, trade unionists and politicians now find the world a perplexing place. Should Germany be robbed of the fruits of its hard work by planned economy upper limits for current account surpluses?