This is an excellent MUST READ article from Bruce Bartlett, written in the Economix column of the NYT. Check it out!
Reflecting a little, the underlying message is that the economic success of Postwar Germany was based upon economic liberalism. Sadly, economic liberalism in Germany seems to have in recent years given way to a policy of caution with too much power given over to legal checks and balances; this policy known as ordoliberalism is unique to Germany. Within Germany there are mixed views about Germany’s policy of ordoliberalism, compared to more naked economic liberalism. However, with Germany under Chancellor Angela Merkel increasingly trying to model the rest of Europe on Germany’s example, there are more serious concerns about ordoliberalism being the right economic platform. Also it is important to remember that Angela Merkel grew up in East Germany and missed out on the post WWII economic recovery in West Germany.
This thread leads me to some interesting open questions:
- Should Germany give greater weight to economic management and less to legal checks and balances?
- Should Germany learn by its post WWII success and revisit economic liberalism, especially for the wider EU?
- Is the case for ordoliberalism still valid?