Germany Avoids Debt Crisis

With countries from the U.S. to Greece suffering from the results of borrowing too much money, how has Germany managed to keep its economy strong (and its credit rating better than America's)? Chancellor Angela Merkel has worked to avoid debt, and encouraged other European countries to do the same. Various news services (AP, Reuters, and Fox) report that Merkel

called for all euro zone nations to enact constitutional amendments requiring balanced budgets. They said they want the process completed by the summer of 2012, but it would almost certainly run into protracted political difficulties in many countries.

Balanced budgets are good for any country, anywhere, anytime. Perhaps America can learn from Germany on this topic.

Wirtschaftswunder - Economic Miracle

Todd Buell surveys the global economic climate, reviewing the data for May 2011, and notes the amazing performance of the German economy:

Some Germans and their politicians like to think of their country as the growth “locomotive” of the euro zone. Today’s initial GDP estimates bear out this claim, yet do little to solve the euro zone’s persistent problem of diverging growth trends.

Europe's problems cannot be overcome by the strong economies of countries like Germany, Switzerland, and Austria. The negative numbers from Spain, Greece, and France are pulling the "euro zone" down.

In adjusted terms, quarterly growth was 1.5%, well above economists’ forecast of 0.9%. Adjusted yearly growth of 4.9% was the highest ever recorded since pan-German data became available in 1991. Growth even reached its pre-crisis level, meaning that we can stop talking about “the recovery.” Indeed, the economy is healthy and hale.

The poorly-performing countries in the "euro zone" and in the rest of the world need to study the models set by Germany and its neighbors (including Poland and the Czech Republic). Greece, in particular, is a drag on European economics. The mixture of private debt and public debt in the United States is a drag on the world's economy.

There are clear signs that the euro zone is experiencing a degree of decoupling with countries following divergent paths. For example, French growth surged in the first quarter and Dutch, Belgian and Austrian GDP also grew by or at around 1.0% on the quarter. Meanwhile Portugal’s economy contracted by 0.7% while Spain’s expanded by a modest 0.3% for the first quarter.

Although central Europe can't single-handedly rescue the entire euro zone, it is at least helping to keep it afloat in the short run:

The German data showed broadly that the domestic economy made the main contribution toward output growth. For the euro zone as a whole, this is good, especially since it means German economic growth is going beyond its traditional strengths of exporting high-end machines and products.

Not only does Germany's growth keep Europe afloat, but it also gives the weaker-performing a potential trading partner:

A consumer-led development in Germany would mean that the country would up its imports, clearly benefiting other economies in the euro zone. For example, German strength can help Spain “export itself out of trouble,” Berenberg economist Holger Schmieding wrote in a note following the German release.

If Germany has already worked itself out of the economic downturn, it may show the way to other countries.

While Germans are not known for their outward displays of emotion (unless it involves the national soccer team), they can take pride in their, now fully completed, economic rebound. Support of the labor market through subsidized lower working hours during the downturn helped keep people on firms’ payrolls. When global demand returned, the workers were there to produce. Now they themselves can spend. It’s a virtuous circle, which some call a miracle.

In any case, Austria, Switzerland, and Germany offer a model for other economies, momentum for Europe's and the world's economies, and potential business and trading partners for forward-thinking businesses.

Strong Economies Pay the Price for Weaker Ones?

Chris Stirewalt, analyzing world business trends, noted that a pattern is developing among the industrial and post-industrial nations of the world:

Europe’s economy and currency are already a disaster, this will not make the rest of the world better disposed toward underwriting the misadventure of lashing the economies of strong nations like Germany and Britain to those of week sisters, like Greece and Spain.

As fewer nations around the world are able to sustain their own economies, the nations which have thus far done well at maintaining a stable business environment are being punished with the task of bailing out the losers.

The U of M Is the Biggest!

Of the twelve universities in the Big Ten, the University of Michigan has more undergraduate students listed as German majors than any of the others!

You don't have to be a German major to live in the U of M's North Quad, but living in the North Quad is one way you can live on the Central Campus: otherwise, most students are relegated to dormitories on the North Campus.

The North Quad is home to the Max Kade House, the university's German dorm program. Anyone interested in German can live in this newest, and most high-tech, of all U of M dorms.

Otto Armster

Born in 1891, Otto Armster assumed command of the Vienna counterintelligence office as a colonel in April 1944. Since 1939 he had been in contact with the resistance group in the counterintelligence community headed by his friend Admiral Wilhelm Canaris. In Vienna, Armster worked with Georg Alexander Hansen, Hans Oster, and Ludwig Gehre and on several occasions met with Hermann Kaiser, a confidant of General Friedrich Olbricht. The conspirators planned to employ Otto Armster as a liaison officer in Military District XVIII (Salzburg). Arrested in Vienna on July 23, 1944, he was brought to Berlin and held in the Lehrter Straße Prison until he was released on April 25, 1945. On May 15, 1945, the Soviet Secret Police arrested Otto Armster and deported him to the Soviet Union, where he was forced to remain until 1955. All countries involved in WWII (on both sides) released their POW's at the end of the war, except the Soviet Union. Prisoners held by the Soviet were kept for many years after the war's end, and some never returned home. In undermining Hitler's power, Otto Armster was helping the Soviets, but they imprisoned him anyway.

Gerhard Anschütz

Born in 1867, the Heidelberg professor of constitutional law Gerhard Anschütz was regarded as a leading commentator on the Weimar state constitution. He therefore professed his faith in the Weimar Republic, regarding it as the rightful constitutional state. In 1933, Anschütz observed the National Socialist takeover of power with shock. He applied for early retirement as a professor, withdrawing into private life and never working to the advantage of the new regime. In his only academic paper to appear after 1933, he wrote in favor of autonomy of the church, thus supporting the position of the Confessional Church. Anschütz survived the National Socialist regime and died a highly honored man in Heidelberg in 1948. As a legal scholar, he understood that freedom for the church was the key to resisting the Nazis.

Martin Albertz

Born in Halle/Saale in 1883, Martin Albertz studied theology and became a pastor in Stampen near Breslau in 1910. In 1931 he became superintendent in the Berlin district of Spandau. In the struggle within the Church he fiercely opposed the National Socialist "German Christians", and was a member of the circle that established the Pastors Emergency Council in 1933. (The Nazis established the National Socialist German Christians group, which in reality was not Christian, but actually was a pro-Hitler group; they wanted to infiltrate the Christian churches in Germany and convert them into anti-Christian groups. The Pastors Emergency Council was started to prevent this.) In 1934 Albertz assumed responsibility for establishing and directing the Theological Examination Office of the Confessional Church of Berlin-Brandenburg. He also taught at the Protestant University, which was regarded as illegal from 1937 on. Any college or university which taught Christianity was made illegal by the Nazi government. In 1936, as a member of the Second Provisional Church Directorate, he was co-author of a memorandum to Hitler that included condemnation of state intervention in Church life and the persecution of Jews and political opponents. In 1938 Albertz was co-publisher of a prayer liturgy that confronted the German people with their shared responsibility for the impending war, and called for atonement. As a result of a disciplinary procedure initiated in 1938, Albertz was removed from his post in 1940. Since he continued teaching, holding examinations for the Confessional Church and helping persecuted people, the Gestapo arrested him in May 1941. The Berlin Special Court sentenced him to 18 months in prison in December 1941. Martin Albertz was imprisoned again in June 1944 for working as a pastor and for "demoralizing the troops". However, he survived the war. He died in 1956, and is remembered as someone who pointed out that the Nazis were, in some cases, forming groups which claimed to be Christian, but were in fact trying to insinuate themselves into truly Christian groups and stop the Christian resistance activities.