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Do the Germans have a superiority complex?

Discussion in 'International Politics' started by mindlight, Feb 10, 2012.

  1. mindlight

    mindlight See in the dark Supporter

    As the economic powerhouse, leading global exporter and main creditor nation of Europe the Germans have a lot to be proud about. Their vision of a Europe with the Euro is the one that people are buying into and when nations are in trouble they look to the Germans to bail them out. Angela Merkel is central stage with the all the big wigs of Europe trying to sort out their problems for them. Those who do not buy into the German vision of things are usually heavily outvoted and even marginalised. German engineering is globally competitive and it produces some of the highest quality cars, machine tools etc in the world. They have an almost balanced budget with debt falling as a % of GNP. But there is an anger building against the Germans which I have noticed and its not just Greece. Many people consider the Germans blind to the real issues and to set on a distinctively German way of doing things to see the real needs of those who call on their help. Part of this may just be the resentment of losers against the successful but is some of it also fair?

    My questions are these:

    1) Do the Germans have a superiority complex? How would you demonstrate that? Or are the Germans actually superior to the rest of us right now?

    2) What problems will a superior Germany cause for the rest of the world?

    3) What are the likely consequences/costs of an exaggerated sense of self importance for the Germans themselves?
  2. Thekla

    Thekla Guest

    Actually, Germany needed the periphery countries to replace the lack of demand within her borders, created in part by low wages. Her "economic miracle" may be of her own devising, but is not altogether of her own making.

    As for fiscal restraint, her banks are in relatively better shape, but have not yet written all the bad debt onto their books, and will need recapitalization. Its anyones guess what this amount might be. Further, the reckless behavior of German Banks offshored to Ireland is being reimbursed on the backs of the Irish (apparently Germany has adopted the US model of rewarding irresponsible behavior in the financial sector). Had the Irish refused to reward the offshored Ger. Banks for their failure (and risk is called risk - because its risk), Germany would not be in quite the same position now.

    Recall also that Germany was one of the two recipients of US largesse via the Marshall Plan - she did not build her economy on her own. In fact, the US actually preferred Japanese and German business interests over her own to put these two countries "back on their feet". (Recall that the Nuremburg Trials were originally to include the prosecution of German business leaders who had colluded with and supported the war machine, slave labor, etc. The US broke her promise on this count, in the interest purportedly of rebuilding the German economy).

    This world has not - for a very long time - been made up of discrete players. Germany's economy is doing well, but this is not entirely the result of Germany "alone".

    Although perhaps not a direct response to your question, these factors should be considered.

    As noted in another thread in this forum, Germany forced Greece to make a loan of gold in order to support the German war effort. That loan has never been repaid to Greece. The value of the "borrowed" gold today would exceed the cost of the Greek debt. Where would Germany be today if she had repaid Greece, and without the Marshall Plan ?

    Perhaps this explains some of the resentment ...
    Last edited by a moderator: Feb 10, 2012
  3. mindlight

    mindlight See in the dark Supporter

    That's not the real reason. Germany is facing a demographic time bomb due to its failure to have babies in recent years. A current account surplus is a a way of saving for the time when the current workforce starts retiring. However what is a worry for the Germans is that many of their external investments (290bn dollars) are in three southern european countries that are at risk at the moment e.g. Spain, Portugal and Greece.

    Germany’s trade surplus and investments in southern Europe | vox - Research-based policy analysis and commentary from leading economists

    Most countries behave in their national interest at the end of the day. Germany benefits from membership of the Euro as the weaker countries of Europe keep the price of their money low for them enabling them to sell their goods at more competitive prices all round the world. Their surplus with the rest of Europe is growing. German wages are not that low relative to the rest of Europe but they could be a lot higher given the relative prosperity of their companies.

    The biggest problem with Ireland was the property bubble. When the house bubble burst the foreign savers who had deposits in the Irish banks which relied on them to supply the necessary finance withdrew their deposits at the click of a mouse and the Irish banks were instantly insolvent. They were building empty properties and selling them at inflated prices- it was an unsustainable situation. German savers and banks that had lent moeny to Irish banks were lucky that Ireland decided against declaring bankruptcy but the housing bubble was not their fault.

    But it does add to the German sense of smugness that they still have their savings accounts intact while those they lent to are struggling to make ends meet.

    We've discussed this before I think. Other countries e.g. Britain and Greece were also recipients of Marshall Aid and Greece was a beneficiary of Western military support that saved them from Communism also. Marshall Aid is something that is the USAs historical favour and marks it out as a true superpower. It was also the right thing for the US national interest as it ensured that Western Europe did not fall to communism and created new trade possibilities for American firms also.

    German industrialists were very often naive about Hitler and thought at first they could control him. They could not and by the time they realised that it was too late. They are no more guilty of collusion than your average German footsoldier fighting Hitlers wars. Most of this class of people have long since died and Germany today is a different place.

    No this gold was long since repaid as previously discussed in reparations in 1960 and since then. And sorry but the cost to the German tax payer of Greeces most recent bailout is vastly in excess of any sums we are talking about. This is a grasping after straws and an attempt to evade responsibility I think. Greece is broken because of Greece - it cannot blame the Germans. The Germans know that and feel smug because of it. In this case maybe with good reason. But the Greeks don't like that.
  4. Thekla

    Thekla Guest

    German liberal and conservative forces agreed on keeping wages low; many Germans are in jobs that do not qualify for minimum wage. At the time of the reunification, the German workforce swelled with highly trained and disciplined workers who also were accustomed to low wages. As well, Turkish immigrants are crucial to the workforce and accept lower wages. The percentage of working poor in Germany has doubled in the past decades. The fact remains that lower wages - in fact 2% under the growth recommended by the EU - have eroded interior demand. It would not be unreasonable to think this might also affect the birthrate.

    The property bubble was in part created by German offshore banks - not infrequently as a one-man office on Irish soil, carrying an Irish name but originating in Germany. (Recall, banking restrictions were more conservative in Germany, hence the move to offshoring to increase opportunity for speculative risk). UK banks were also involved, of course. The Irish bailout was a bank bailout; the economy destroyed by speculation and the property bubble that resulted. It seems somewhat disingenuous to feel smug on this matter, as the average Irish citizen was no more involved in the fiasco than the average German citizen.

    Would Germany be in the same financial position today without the rate of exports to the periphery ?

    Of course, and Japan as well. But the fact remains that the chief recipients of the Marshall Plan, including the deliberate preference of offshore business over the interests of US business, were Germany and Japan. This is not to underplay the abilities and successes of the Germans and Japanese, but clearly the program was deliberately targeted towards these countries (at the expense of those on US soil). Would the German economic miracle have precisely the same shape and timeline without US largesse ? I think not.

    Yes, at first this is likely. US businesses, heavily invested in German corporations involved in rebuilding the German war machine, also did not realize this at first. (Upon discovery, it was determined by the US at the recommendation of one of the Dulles brothers iirc the that Ford etc. should not divest owing to the likely impact on the US economy.) That there was knowledge among German business leaders at some point, thus entering a long period of willful collusion, is well documented. (See The Great Blond Beast, Christopher Simpson) That these business leaders were to be covered under the Nuremberg trials, and were not due to US request, is also documented.

    The gold reserves in question were part of a particular "loan agreement" signed by Germany and an Italian occupier, and were not returned. The forgiveness of Germany's war reparations to Greece in 1990 is documented, and was covered in the UK media.
  5. mindlight

    mindlight See in the dark Supporter

    Germany does not have a universal minimum wage but it is applied in some sectors. This allows migrant workers to work on harvests etc , often for more money than they would have earned in their own country.

    You can exaggerate how well trained the workforce of East Germany was at the time of unification. With few exceptions they were decades behind their Western peers and most had to completely redevelop their skill sets before they could become truly productive. This was an enormously costly undertaking. Poverty remains concentrated in East Germany from where many of the best and brightest moved away to better jobs in the West. Other significant concentrations of poverty occur where the number of immigrants is high. These are also characterised by families way above the normal size and this reinforces the statistics. But you forget that both East germans and immigrants are in the main vastly better off than they were in their oiriginal host countries and their poverty is relative to the riches of the German peoples with their excellent public services etc.

    Yes there has been a deliberate attempt to restrain wages and this has been great for German countries but I have spoken with Germans who are conscious of the drag on their potential living standards of this policy. I personally think its the best policy for Germany and works on the global level and not just on the European level for Germany. Other countries need to make their own choices here. the wages of the public sector in Britain and Greece were clearly inflated way above what was sustainable by the private sector in the last decade and this has caused many of the problems faced by these two countries.

    It was 3 big IRISH banks that tottered on the brink of bankruptcy not German ones even if German savers may have been exposed to the possibility of a default in Ireland. Wheres the evidence for these Offshore banks?

    Greece and Ireland are small beer compared to the growing global markets that Germany sells to in Asia and America for example. These markets are also growing faster than the European one. But being globally competitive clearly helps Germany in Europe also. The peripheries main value to Germany is that it keeps the price of its money down and allows it to sell its goods at a more competitive rate.

    It happened in China and India without American money- but Marshall Aid definitely helped. the key benefit was that it kept these countries out of the Communist orbit, Communism has ruined the countries it has cursed with its help.

    These guys were not pure evil even if they managed to aid the success of one of histories worse regimes. They loved their country and made some bad choices and anyway most of them are now dead. Communism was a clear and present danger while punishing industrialists was not really going to do anyone any good. So the US made the right decision on this one I think in the circumstances. Anyway haven't you seen Schlindlers List- they were not all bad!

    The money was paid in 1960 and in aid since. Germany does not have this gold. Greece forgave Germany in 1990. This is just sour grapes and wounded pride with no factual basis
  6. Paradoxum

    Paradoxum Liberty, Equality, Solidarity!

    Is it bad if when I see the word 'superiority' and 'Germany' I can help but think of the darkest part of the last century. Or perhaps that was your intention.

    Anyway I have no problem with Germany and I support a strong(but peaceful), integrated Europe.
  7. mindlight

    mindlight See in the dark Supporter

    Nazi Germany is not something that most Germans make any association with at all. SO that was neither my intention or anything to do with the sense of superiority I read in many Germans. Also the list of reasons I gave relating to why Germans might feel superior does not include anything related to the Nazis.

    In practice a strong , peaceful and integrated Europe appears to be increasingly dominated by its largest power. This works very well for Germany and for a great many other countries also. But the German vision for Europe may not be a healthy one for all of its current members. Greece will not become a fiscally disciplined country overnight for instance and its admission and now preservation in the Euro is probably a mistake. German convictions about their own vision may end up costing their tax payers billions. Yet still the German political elite thinks this policy is right for the long term. Is this:

    1) a superiority complex that blinds them to the true realities of the situation,
    2) a well thought out policy that benefits the national interest of Germany or
    3) a genuinely European plan.

    The three possibilities are in fact , though overlapping to a considerable extent, very different strategies and views of the end game.
    Last edited: Feb 18, 2012