(http://www.forbes.com/sites/mahaatal/) _Maha Atal_ (http://www.forbes.com/sites/mahaatal/) , Contributor I write about political economy and foreign affairs. < 10/07/2010 Germany's Radical Center The econo-world has been abuzz about Germany because the country has _done a remarkable job_ (http://online.wsj.com/article/SB10001424052748703735804575535522640616504.html?mod=rss_europe_whats_news) outperforming its first world peers as it emerges from the Great Recession. Last quarter, _it went on a 9% growth rampage_ (http://www.theatlantic.com/business/archive/2010/08/germanys-monster-quarter/61454/) . This year, _it’s expected to grow over 3%_ (http://www.monstersandcritics.com/news/business/news/article_1589552.php/Germany-rebounds-but-much-of-Europe-struggling-IMF-says-Roundup) , compared with less than 2% for the most of the developed world. When econo-wonks process those stats, they try to claim the success story as a victory for their preferred models, while constructing any downsides as failures of the other side. They are wrong to do so. The _right looks approvingly_ (http://www.nytimes.com/2010/07/18/business/18view.html?_r=1&scp=1&sq=tyler%20cowen&st=cse) at Germany’s flexible labor markets, aggressive austerity plans and deficit hawkery, and its disdain for fiscal stimulus after a bad run with it twenty years ago. The _left looks approvingly_ (http://krugman.blogs.nytimes.com/2010/09/10/ever-expanding-government/) at Germany’s expansive social safety net, its strong industrial policy, and a handful of _pushy financial regulations_ (http://www.ft.com/cms/s/0/c97778e4-d230-11df-8fbe-00144feabdc0.html?ftcamp=rss) . At the same time, both sides look with some trepidation at Germany’s relationship to the eurozone. The right sees “scary” global governance; the left _sees a monetary policy_ (http://www.businessweek.com/news/2010-10-05/soros-says-germany-threatens-europe-with-deflationary-spiral-.html) that hurts poorer countries in the South. But nobody disputes that whatever Germany is doing _works for _ (http://www.bbc.co.uk/blogs/thereporters/stephanieflanders/2010/05/dont_sell_germany_short.html) _them_ (http://www.bbc.co.uk/blogs/thereporters/stephanieflanders/2010/05/dont_sell_germany_short.html) . But the German success is not a left- or a right- wing one, nor even a Third Way one. Because while it is true that Gerhard Schroder, the undercredited architect of the German model, was a Third Way liberal, he was not working from the same playbook as his Atlanticist counterparts. Clinton and Blair were introducing individual market mechanisms into an overall state structure, foreign objects into a preexisting beast, in a way that aimed to tame the worst excesses of each system, but did not radically redefine either. That’s what it means to triangulate: to draw connections between disparate things and occupy the space in the middle. What Germany did, however, was to merge two complete systems—from West and East Germany—to lie them on top of one another in untamed form, such that both were fundamentally redefined. German interventionist industrial policy, its strict fiscal discipline, its robust social welfare system and its complicated tax system are not a function of Schroder’s Third Way-ism but rather a function of the peculiar political challenge he inherited: to build one economy out of two. This is something _BusinessWeek’s latest cover on Germany _ (http://www.businessweek.com/globalbiz/content/sep2010/gb20100929_427718_page_4.htm) hints at, but the piece falls back too easily on the usual Third Way explanations for why specific policies worked. Reunification is an equally useful historical marker for understanding Germany’s relationship to the eurozone. It is _because of the thorny regional politics of reunification and the legacy of WWII,_ (http://www.thenation.com/article/germany-and-euro-crisis) and _under consequent French pressure_ (http://www.dw-world.de/dw/article/0,,4861759_page_2,00.html) , that Germany committed to the monetary union in the first place and was made to take a kind of ownership for its success. And, as other European powers anticipated , Germany _quickly sought to orient the eurozone_ (http://www.theatlantic.com/business/archive/2010/10/what-makes-germany-germany/64099/) to benefit itself. Bickering over whether the ideological mooring of German economic policy is left or right, if its European policy is collaborative or exploitative misses the point—the whole ethos of the German model is that the binary does not apply. And that is unique and powerful and sometimes admirable but it is also a historical accident. So wonks, please stop asking why other countries don’t behave like that. -- -- Centroids: The Center of the Radical Centrist Community <[email protected]> Google Group: http://groups.google.com/group/RadicalCentrism Radical Centrism website and blog: http://RadicalCentrism.org --- You received this message because you are subscribed to the Google Groups "Centroids: The Center of the Radical Centrist Community" group. To unsubscribe from this group and stop receiving emails from it, send an email to [email protected]. For more options, visit https://groups.google.com/groups/opt_out.
