Why are Germany and Japan being economically so successful?

I pose this question in order to get your view on the matter.

I believe that these two countries who lost the war and were completely destroyed threw bombings could bounce back so quickly because the world's superpowers did not (and to a degree still don't) allow them to have a vast military force, yet committed in protecting their borders. The US spends over 20% of it's federal budget on military spending/defense spending while Japan spends only 2% and Germany around 3%.

Hence these countries have so much money left over to provide health care, infrastructure and other services to their citizens. I believe that the lack of spending money on military provides the bases of a healthy economy...

 

Until 2009, Germany had higher unemployment than the US. Japan has been in a deep recession since 1990.

 

The Marshal Plan and craftsmanship.

 

The problem with Germany's unemployment purely resulted in the Eastern-German parts, which they got back in 1989. I don't think that Western-Germany at any point in the last 20 years had a higher unemployment rate than the US. But to get back to the topic: Why do you think that Germany and Japan are doing economically well now?

The Marshal Plan still employs people to this day, so obviously it is a factor, but do you believe that it's money was enough to rebuild the damages after WW2? After all Germany lost 7 million people - and an additional few million because of Hitler's crazy genocide. So after all those losses, and the fact that most cities lay in ruins till the mid 50s, how do you explain the very fast recovery?

Do you think that German and Japanese craftsmanship is superior to other countries? I mean what makes these two peoples in your mind superior in any way. Are they smarter, do they work harder?

 

That could be one reason. But they were successful before they were defeated in the wars and then they probably didn't spend just 2-5% of the budget on defence. Also, how come the US is a powerhouse? But maybe it's something about those people, they might just be extraordinarily industrious.

 

West Germany observed 10% system unemployment prior to 1989.

Japan's economy has been in the dumpster for a generation and the earthquake/tsunami made it even worse.

Germany and Japan both subsize the presence of US bases in their territory.

 

Well my point of view is that money spend on a battleship is a waste of money. The battleship is good for maybe 10 years before it's outdated, and post production it costs a fortune to maintain. I think as a government I can create a healthier society by spending money on colleges or college scholarships. It's a fact that for every 100 advanced degrees nearly 300 additional jobs are created. So in my mind, if I don't spend the money for a battleship in that field, I can put a hundred (probably way more) people through college and create 400 jobs which increase the country's revenue.

I just think that since 1991 the western world has no need for a big army anymore. Never in our history two democracies went to war against each other. And because the majority of the most advanced counties are now democracies, I don't see the necessity of overspending on military force. If you put money into the military you just give away money and do not create new revenue. On average a single soldier requires 20 people behind them, who produce the products, services, food, weapons, etc. So if you have 1 million soldiers, it's basically 21 million people who're employed because of military spending - and they don't really produce the same amount of revenue as 21 million teachers, factory workers, policemen, nurses, doctors, etc. would.

Things change. It's pretty unlikely for us to engage in a war with another country. If we are at war, it's usually the NATO, a selection of top military powers vs. somebody who's got no chance of winning.

I'm just not sure if military spending is the way to go now. And as Texcutter pointed out, there are still US bases in Germany and Japan, which insure the protection of these lands, making it possible for Germans and Japanese to spend even less on military and invest even more in infrastructure and government services in their country.

 

I actually agree with that, that the west, and the USA in particular, can very well lower their military spending. If they work together as NATO they're stronger than the rest of the world combined anyways. and also, the US should check wheter it's really necessary to maintain military bases in some areas e.g germany, japan. It's basically just the US paying for their defense, something which the US can't afford and that they can easily afford themselves. Or atlest, charge the countries they are protecting. And if there is a ban on germany and japan having larger armies I think it should be lifted, they're not psycho anymore. they're actually really sane nowadays, and stronger western countries is always better.

 

...Which we don't need. Like, seriously, Germany has a booming industry, nukes, and is surrounded by friends. Japan, maybe moreso, but Germany? Are you (*)(*)(*)(*)ing kidding me? Hell, the whole military complex in the US is, for the most part, waaaaay overblown. If you'd stop playing "world police" and invading every country that looked at you funny, you would barely need a military at all. Nobody will (*)(*)(*)(*) with you. Well, okay, terrorist individuals and groups, but you can't fight that with traditional forces.

OT: In Germany's case, there are two major reasons I can see. The first is the industry sector. Germany never abandoned its industry, and it spent a fair bit of money ensuring that it could remain competitive in a global market. It then proceeded to do extremely well due to the expansion of the euro sector, which led to a gigantic toll-free international market, and influxes of cash to countries that previously would not have been able to afford German goods (...that didn't turn out so well, as it turns out). The second has to do with Konjunkturpaket 1, Konjunkturpaket 2, and the Abwrackprämie: the two major German stimulus packages, and a sort of cash for clunkers program that helped citizens to ditch their old cars and buy new cars to keep the industry sector running. I see it as a major success of Keynesian policy, to be honest. It has next to nothing to do with military, though.

 

I always think of France as the only real democracy because it's people continued to fight for a democracy and won and won again against their own government. I think only in France the leader knows for a fact that if he doesn't do a good job, the people will actually march in his house and hang him in the middle of Paris. The government is afraid of the people, not the other way around.
The USA are the only other country to my knowledge to do that (at least in the industrialized world). But the people in the USA changed since the 1770s and 80s. The new "citizens" didn't experience that fight, or brought the mentality outside the original 13 colonies with them. So I think that the vast majority of the people in the United States don't have that attitude I consider necessary.
Everyone else didn't fight for democracy but was given democracy. So we don't really know how important the thing is we were given, and don't really take it serious. The "old" national mentalities since WW1 haven't really changed in many of the European countries, that's why I think the Germans might be more successful than other nations. Their attitude of "WE" replaces the capitalistic "I".
To me a great example are the 1970s. The auto-industry had major financial problems back then. GM solved the problem by laying off a couple thousand workers until "business" would improve again. VW reacted by explaining to their employees that nobody was being laid off, but everyone in the company would get a 50% paycheck reduction until "business" improved. But this wouldn't cover the hard times. More money had to be saved, so VW explained that in order to provide a situation where nobody way laid off, the workers would have to contribute, by not letting any materials go to waste. Whenever they was material left over, or a bolt left over, they'd have to catalog it and use it on another vehicle.
A couple years passed, GM hired back the people they needed, VW increased all the paychecks to what the used to be, but the workers still kept saving left over materials.

I think that this "WE" priority actually makes Germany an economic superpower. They don't look out only for the best of the company or the best of a few, but rather how can we all improve. Very admirable, and we should start copying that!

 

The problem with Keynesian policies is that they are victims of gravity. What goes up, must come down. Any economy built on this philosophy will always devalue the currency and property of those within the economy so that when a crash happens they are left in a position critically less advantageous than before. It is no great feat to pump currency into an economy or use public money to fund the public. It's a shell game. Eventually, though, you must pay the piper.

 

The economy doesn't seem to take too kindly to the concept of gravity overall, though. In fact, a year where GDP per capita doesn't go up is generally considered a really bad year. Furthermore, Keynesism does not necessarily have to have a net devaluation; the piper may indeed by payed. I think the greatest failure of Keynesian policy is that governments seem very bad at the intrinsic "part 2" of Keynesianism: when the bust is over, and the economy is back to running at close to full capacity, make that money back, do some basic austerity policy. I must admit that I'm not 100% sure what you mean by "devalue the currency and property".

 

Just wondering one thing, and I present it lightly.

A lot of threads you refer yourself as an American using words like 'I' and 'we' when regarding yourself as a liberal, which is fine. But now you have come and used 'we' as a German.

Do you have dual-citizenship? Or were your parents Americans living in germany?

 

The German economy is good right now for two reasons. !st they did their version of austerity in 2007-8, 2nd most of the rest of Europe especially the Southern tier and the former Warsaw pact function for Geman much like Brtiains former colonies did for her during the heyday of Mercantlism.

Japan as has already been pointed out is essentially an economic wreck whose dependence on US markets has hurt them badly.

 

I'm an American expatriot living in Munich. I have family in Munich and Germany, none German though. I feel it appropriate to refer to myself as part of "us" when speaking of the US and of germany, although I sometimes don't to avoid confusion.

 

So why did you leave?

 

That is a long and rather bizarre (nothing illegal or too far out of the ordinary, just a lot of "Wait, we're just going to do this for no real reason at all?" moments) story that I'd rather not bog the thread down with. I'll just say we started by going to France (friend of ours let us have his house there in exchange for some masonry) for a year and then just somehow never ended up leaving Europe.

 

Neither of those countries has a significant class of citizens who have been conditioned that they cannot get along without the government supporting them. The US does.

 

Because they haven't done what the conservatives want us to do, cut spending and cut taxes.
EVERY country that has done is now floundering, including the US.

 

Outright lies have no place in a real debate.

 

You have to consider they have a big brother who'll kick azz if anybody messes with them too. That big bro would be US.

 

Japan is economically successful?

Japan is a demographic time bomb whose economy was stagnant for over a decade and is certainly not a model to emulate.

 

The above sums it up quite nicely.

 

Care to explain how my comment is a lie?

 

Japanese economy has been in the toilet for more than two decades now. The Japs have not recovered since their own real estate bubble burst. Apple are kicking the Japs electronic makers from left and right. SONY, TOSHIBA, SANYO, HITACHI,....etc...you name it. All of them got their asses whoop by Steve Jobs and Co. The Japs rely on export to grow their economy, and a strong yen does not help it either. On top of that, Ben The Printer is out at full force with his own QEternity to weaken the US$, thus effectively put a full stop on the Japs economy. And btw, now they're at odd with Chinese commies over some disputed islands. Most if not all Japanese businesses in China are shutting down since the crisis started months ago.

It's going to get worse, a lot worse. I don't know if I ever see the Nikkei go back to pre housing bubble burst level in my life time.