Robert Reich: What's Germany's Secret?

What’s Germany’s secret? In sharp contrast to the decades of stagnant wages in America, real average hourly pay has risen almost 30 percent there since 1985. Germany has been investing substantially in education and infrastructure.

How did German workers do it? A big part of the story is German labor unions are still powerful enough to insist that German workers get their fair share of the economy’s gains.

That’s why pay at the top in Germany hasn’t risen any faster than pay in the middle. As David Leonhardt reported in the New York Times recently, the top 1 percent of German households earns about 11 percent of all income – a percent that hasn’t changed in four decades.

Contrast this with the United States, where the top 1 percent went from getting 9 percent of total income in the late 1970s to more than 20 percent today.

The only way back toward sustained growth and prosperity in the United States is to remake the basic bargain linking pay to productivity. This would give the American middle class the purchasing power they need to keep the economy going.

Part of the answer is, as in Germany, stronger labor unions — unions strong enough to demand a fair share of the gains from productivity growth.

http://robertreich.org/post/6538345540

A dual board system is prescribed by law for German stock corporations:

The Management Board is responsible for managing the enterprise. Its members are jointly accountable for the management of the enterprise. The Chairman of the Management Board coordinates the work of the Management Board.

The Supervisory Board appoints, supervises and advises the members of the Management Board and is directly involved in decisions of fundamental importance to the enterprise. The chairman of the Supervisory Board coordinates the work of the Supervisory Board.
The members of the Supervisory Board are elected by the shareholders at the General Meeting. In enterprises having more than 500 or 2000 employees in Germany, employees are also represented in the Supervisory Board, which then is composed of employee representatives to one third or to one half respectively. For enterprises with more than 2000 employees, the Chairman of the Supervisory Board, who, for all practical purposes, is a representative of the shareholders, has the casting vote in the case of split resolutions. The representatives elected by the shareholders and the representatives of the employees are equally obliged to act in the enterprise's best interests.

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5.1.2 The Supervisory Board appoints and dismisses the members of the Management Board. When appointing the Management Board, the Supervisory Board shall also respect diversity. Together with the Management Board it shall ensure that there is a long-term succession planning. The Supervisory Board can delegate preparations for the appointment of members of the Management Board to a committee, which also deals with the conditions of the employment contracts including compensation.

Compare International Medical Bills
July 2, 2008

Countries with governments and economies similar to the United States have come up with a variety of methods to make sure that all of their citizens receive health care. While residents in Europe and Japan may pay higher insurance premiums or taxes than Americans, in the end, when all costs are added up, Americans spend more money on health care per person with fewer people covered. (Data most recent available as of July 2008.)

Use the drop-downs below to compare countries.

http://www.npr.org/templates/story/story.php?storyId=110997469

Germany

Population: 82.3 million

Life expectancy at birth: 79

Health spending as part of GDP: 10.7%

System type: Universal coverage. Mostly employer-employee based (88%).

Coverage: 99.8 % -- all citizens and legal residents

Average annual per-person spending:
Total: $3,673
Breakdown: $2,518 on mandatory employment-based coverage, nonprofit insurance; $259 on for-profit insurance; $349 by government; and $547 consumer out-of-pocket*.

Financing: Workers split premiums with employers, with each paying about 8% of workers' gross income to nonprofit "sickness funds." Those earning over $75,000 may purchase insurance from for-profit insurers.

Notable features: Comprehensive coverage including basic dental and long-term care. Short waits - usually less than a month - for elective surgery. New programs provide extra attention to diabetes and other chronic illnesses.

Biggest challenges: Large and growing aged population, high costs, high rate of specialist visits.

Prescription drug coverage: Full coverage with small copayments. Federal panel controls prices and an expert committee decides which new treatments should be covered.

Doctors: Regional groups of office-based doctors negotiate with insurers over annual budgets. Hospital-based doctors, including most specialists, are salaried.

Hospitals: Insurers negotiate with hospitals over annual budgets.