In recent days, the USA credit rating has fallen, and the US stock market has plummeted. Many people think the USA is headed in the wrong direction. When I look around the world and see countries like China and Germany prospering, even in these dire economic times, I wonder if the USA should try to emulate their economic approach. However, as the old adage says, “the grass is always greener on the other side.”
According to a recent article published by the Organisation for Economic Co-operation and Development (OECD), what country has the fastest-growing inequality and poverty of any developed economy? If you're thinking the USA, you would be wrong. Another clue: workers in this country are paid some of the lowest wages in western Europe. Perhaps, it's Greece, Portugal or some other Euro-zone basket case country.
Well, the answer might surprise you. It's Germany. I know this sounds crazy since we think of Germany as the land of the industrial miracle and social equality. Moreover, during the last year, the German stock market has grown astronomically as the country has climbed out of recession (while the USA has just limped along). For most of us, Germany is a shinning example of what a country can achieve if it keeps its public finances in check, creates a diverse economy, and implements deregulation (some of the goals advocated by the US Republican party).
By all appearances, Germany seems exceedingly prosperous. Yet, Germany has no minimum wage, with approximately 2 million workers paid around $6.50 an hour (a high number given the size of the German workforce). Furthermore, German workers saw their wages (after inflation) actually fall by 4% in the 2000s. So while I am not an economist, these figures sound alarming.
Likewise, China, for all its economic might, has a totalitarian regime with extreme social inequalities. So, what's my point? It's just that we tend to over simplify our view of other countries. The Germans and Chinese have done exceedingly well these past few years, but they have their problems too. And while the USA is still recovering from the Bush era irresponsibility's, it's too early to count the USA out.