Is this warning valid about the EU?

Former Member

http://www.thesun.co.uk/article/0,,2-2003172281,00.html

There was an article in the Sun, "Don't invest in Germany."

Valid or no?

Former Member

Despite my reticence over the typical slant adopted by The Sun, especially in its routine bashing of the continent, I have long advocated to German colleagues that reducing many of the costly regulatory measures would spur faster growth in some of the more overburdened countries of the EU.

I do not agree with the Sun's claim that this is EU wide however, as many of the more cumbersome restrictions are due to national policies rather than EU directives.

France for example maintains competitive trans-national firms in numerous sectors of industry as do Belgium and Holland.

Financial markets also play a large role in the overall GDP of certain EU member states.

In general, this crises of cost is a Western problem, not merely a European one. Much of our own US manufacturing has relocated to more easily exploited markets and work forces in China, South East Asia and Latin America. After all, why pay $8/hr or more when you can exploit developing nations' work forces for .50 cents/hr.

Former Member

That's true about the US. I don't remember the insurance company, but their claims were being processed in Mexico...then they were moved, for even cheaper labor, to Africa...in the shadow of the fort where many of the slaves left for America.

Former Member

Part of the regulatory tradition of Europe, you have to understand pnj, is to counter the notion that what is good for business is always good for society. The only concern for coporations is profit, people are merely the fodder for achieving that end in the corporate psyche.

In order to balance that and provide some modicum of social protection against the whims of often unscrupulous business practices, European governments adopted a more regulated approach to the market.

Like in most areas of life however, some restricitions go too far and should be ratcheted down or eliminated.

Former Member

my dad was saying in NJ companies play games. They get tax breaks for ten years from a town and when that time is up and they'd be paying what they should be paying...they move on. It seems like they do the same thing to the workers in Germany....accept what we're offering you or we'll move to Bulgaria.

Former Member

Originally posted by pnjsurferpoet
accept what we're offering you or we'll move to Bulgaria.

or wales.

Former Member

The cynic in me is having noisy alarm belles ringing in his ears about a top businessman demanding the removal of many labour laws...why is he doing such a thing? Ill wager its not for the good of the German people, though undoubtedly the unions in germany have too much power.

But what he is saying is dont invest in German companies based in germany- Id say the same about any company based in a western nation, TBH. Nike would be nothing without SE Asia, same with the German multinational adidas, same with GM, same with Ford. The list is endless.

Investment = reaping profits from companies. And profits only come when production cost is mimimal, and retail cost is maximal. And companies paying Western wages dont have that balance, because no-one on thsi board would work for a tenner a day FULL TIME.

Former Member

Re: Is this warning valid about the EU?

Originally posted by pnjsurferpoet
http://www.thesun.co.uk/article/0,,2-2003172281,00.html

There was an article in the Sun, "Don't invest in Germany."

Valid or no?

Part of Germany's problems are a too rigid labour market.

Former Member

Originally posted by Clandestine

France for example maintains competitive trans-national firms in numerous sectors of industry as do Belgium and Holland.

In France's case (can't address Belgium or Holland) they do so with extensive Governmental support and assistance. Even with that, a number of them are having a very tough time of it (the Pharmaceutical Companies for example).

Former Member

Originally posted by Kermit

Investment = reaping profits from companies. And profits only come when production cost is mimimal, and retail cost is maximal. And companies paying Western wages dont have that balance, because no-one on thsi board would work for a tenner a day FULL TIME.

Microsoft seems to do pretty well. So does IBM. Both make very solid profits paying Western wages.

Former Member

Yes there are subsidies, but Washington has its own means of aiding our own industries from highly favourable export credits to similar direct financial perks. Don't try to pretend that both sides don't stack the decks in their respective favour.

THis is part of the inbalance that freezes out the developing world markets from penetrating both the US and Europe.