There are many things to admire about modern Germany and a
lot of them were evident during a recent visit which, unusually for me, was a
private rather than business trip. One of the things that always strikes me is
the sense that Germany is still a big manufacturing economy. You notice this in
the vicinity of all the big cities, where there is always lots of traffic and a
large number of lorries delivering industrial goods. Indeed, a high proportion
of the lorries are themselves German made.
But perhaps the thing that always impresses me the most is the sense that it is a prosperous country where the wealth is shared relatively evenly. According to OECD data, Germany’s income Gini coefficient in 2014 was 0.289 (the lower the number, the higher the degree of equality) which ranks it 13 out of 33 OECD countries. It is certainly well below the UK with a Gini coefficient of 0.356, ranking at 29. We should also not forget that it was Bismarck who introduced the first national pension scheme in Germany in 1889, almost 20 years before the UK followed suit. Travelling around northern Germany, through the smaller towns, they appear solid and well cared for, which in my view is a sign of communities that display a sense of civic pride. Many German economists complain that the infrastructure is crumbling and that the government does not spend enough on maintenance and renewal. I can safely say this is not something which is evident in the same way as it is in Britain, although I guess you have to live there to notice it on a day-to-day basis.
This is certainly not evident in Hamburg, where the magnificent new conference venue, die Elbphilharmonie, is a symbol of modern German economic confidence. In a sign of the difference between the German and British economic systems visitors are able to visit the Plaza for free, giving a magnificent view of the harbour, whereas comparable venues in London such as The Shard or London Eye levy hefty visitor charges.
There are some things which still grate on the modern traveller. Deutsche Bahn's inability to accept certain forms of plastic payment card is an oddity which I thought had been confined to the past. Even stranger is that a card which works perfectly well in Frankfurt will not work in Hamburg. Indeed, cash is much more widely used in Germany than in Britain, where I rarely carry very much, and cash in circulation across the euro area relative to GDP is three times that in the UK.
During the course of my recent travels, one question which inevitably came up was that of Brexit, with many Germans puzzled as to why the British voted as they did. It is hard to explain to them that the Brexit vote occurred in large part because the UK has rejected many aspects that German society takes so seriously. I have long extolled the virtues of German inclusivity. That is not what we have in the UK where we operate a system in which the devil increasingly takes the hindmost, as the safety net which underpins the more vulnerable elements of society is withdrawn. Many people in the UK simply do not see that the government is acting in their interests and this is something which is hard to explain to many Germans.
We also should never underestimate the desire of modern Germany to learn the lessons of the past. “Never again” means exactly that. I was fortunate enough to speak to people who were children in the immediate post-war period, who told me what it was like to grow up hungry and how they experienced permanent stomach pains without knowing why. The story of how the women and children used to work in the fields removing Colorado beetles to ensure that the potato crop provided sufficient food for the population was a fascinating vignette of how it was back then. Faced with such hardships, it is no surprise that modern Germany has no desire to go back there.
Germany is far from perfect: No modern society is and it may yet find that the great humanitarian gesture of opening its borders to countless numbers of immigrants causes more problems than currently imagined. But its determination to learn from the mistakes of the past is admirable and something the British can themselves learn from. Many people who voted for Brexit, especially older voters, are guilty of looking back to a Britain that never really existed. It may have emerged on the "right" side of history, but we should not forget that once Lend-Lease was terminated in 1945, economic circumstances changed overnight. Nor should we forget that the UK received more Marshall Aid than Germany in the immediate post-war period, but it was wasted by successive British governments trying to cling on to superpower status rather than modernising the domestic economy. The grim period of rationing and slow post-war reconstruction in the UK was at least partly the result of policy failure. Brexit may not be of the same order of magnitude but it still threatens economic hardships which are avoidable and which people may not be ready for.
As one older German said to me, Brexit is a betrayal of future generations. I happen to believe he is right. Better to try and reform the EU from the inside than cut and run. When even a Guardian journalist points out that the potential loss of banking jobs will put a big hole in government finances, you realise that people are starting to wake up to the fact that Brexit will have real economic consequences. Many of us told you so all along.
But perhaps the thing that always impresses me the most is the sense that it is a prosperous country where the wealth is shared relatively evenly. According to OECD data, Germany’s income Gini coefficient in 2014 was 0.289 (the lower the number, the higher the degree of equality) which ranks it 13 out of 33 OECD countries. It is certainly well below the UK with a Gini coefficient of 0.356, ranking at 29. We should also not forget that it was Bismarck who introduced the first national pension scheme in Germany in 1889, almost 20 years before the UK followed suit. Travelling around northern Germany, through the smaller towns, they appear solid and well cared for, which in my view is a sign of communities that display a sense of civic pride. Many German economists complain that the infrastructure is crumbling and that the government does not spend enough on maintenance and renewal. I can safely say this is not something which is evident in the same way as it is in Britain, although I guess you have to live there to notice it on a day-to-day basis.
This is certainly not evident in Hamburg, where the magnificent new conference venue, die Elbphilharmonie, is a symbol of modern German economic confidence. In a sign of the difference between the German and British economic systems visitors are able to visit the Plaza for free, giving a magnificent view of the harbour, whereas comparable venues in London such as The Shard or London Eye levy hefty visitor charges.
There are some things which still grate on the modern traveller. Deutsche Bahn's inability to accept certain forms of plastic payment card is an oddity which I thought had been confined to the past. Even stranger is that a card which works perfectly well in Frankfurt will not work in Hamburg. Indeed, cash is much more widely used in Germany than in Britain, where I rarely carry very much, and cash in circulation across the euro area relative to GDP is three times that in the UK.
During the course of my recent travels, one question which inevitably came up was that of Brexit, with many Germans puzzled as to why the British voted as they did. It is hard to explain to them that the Brexit vote occurred in large part because the UK has rejected many aspects that German society takes so seriously. I have long extolled the virtues of German inclusivity. That is not what we have in the UK where we operate a system in which the devil increasingly takes the hindmost, as the safety net which underpins the more vulnerable elements of society is withdrawn. Many people in the UK simply do not see that the government is acting in their interests and this is something which is hard to explain to many Germans.
We also should never underestimate the desire of modern Germany to learn the lessons of the past. “Never again” means exactly that. I was fortunate enough to speak to people who were children in the immediate post-war period, who told me what it was like to grow up hungry and how they experienced permanent stomach pains without knowing why. The story of how the women and children used to work in the fields removing Colorado beetles to ensure that the potato crop provided sufficient food for the population was a fascinating vignette of how it was back then. Faced with such hardships, it is no surprise that modern Germany has no desire to go back there.
Germany is far from perfect: No modern society is and it may yet find that the great humanitarian gesture of opening its borders to countless numbers of immigrants causes more problems than currently imagined. But its determination to learn from the mistakes of the past is admirable and something the British can themselves learn from. Many people who voted for Brexit, especially older voters, are guilty of looking back to a Britain that never really existed. It may have emerged on the "right" side of history, but we should not forget that once Lend-Lease was terminated in 1945, economic circumstances changed overnight. Nor should we forget that the UK received more Marshall Aid than Germany in the immediate post-war period, but it was wasted by successive British governments trying to cling on to superpower status rather than modernising the domestic economy. The grim period of rationing and slow post-war reconstruction in the UK was at least partly the result of policy failure. Brexit may not be of the same order of magnitude but it still threatens economic hardships which are avoidable and which people may not be ready for.
As one older German said to me, Brexit is a betrayal of future generations. I happen to believe he is right. Better to try and reform the EU from the inside than cut and run. When even a Guardian journalist points out that the potential loss of banking jobs will put a big hole in government finances, you realise that people are starting to wake up to the fact that Brexit will have real economic consequences. Many of us told you so all along.
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