On Germany’s Consolidations, Past and Present


Germany has had more than its share of unifications, much later than France or Britain. In the course of them it has fought wars with great adjacent powers, and was called upon to sharpen its political skills to keep the nobility in the saddle even while at times conciliating the middle and working class forces.

Accordingly Otto von Bismark, as head of the Prussian Government served his Hohenzollern monarchs by a series of subtle compromises with the middle class democrats and the Socialist workers, whom at other moments he imprisoned. The rapidly rising industrialists he won over with tariff protection, and originated such anomalies as health insurance as early as 1883, compulsory accident insurance in 1884, and even old age pensions.

This amazing background contrasts unflatteringly with the current state of social services in Germany. At this point let us bring in the front-page article of The Wall Street Journal ("New Trend in Germany: Food Handouts for the Poor" by Marcus Walker): "Wuppertal, Germany – Men with shoulders hunched against the rain line up at the back of a van, where volunteers dole out bowls of stew and chunks of bread. Once served, the men take shelter under shop awnings to eat. Few speak.

"The scene could date from the Great Depression, but it takes place every evening in this bustling industrial city in Western Germany. Like others sipping their soup, Hans Martin says he comes here for a simple reason: ’Hartz 1.’ That is the 2005 welfare law that slashed benefits for Germans who have been out of work for over a year. Mr. Martin, a 54-year-old warehouse worker with heart trouble and numerous missing teeth, says he can’t find work. His monthly benefit checks cover him for only about 20 days, he says. Towards the end of each month, he comes to the soup van to avoid going to bed hungry. ‘I’m lucky. I don’t drink,’ he says. Others do, and they run out of money on day 10.

"For decades. Germany’s state kept the majority of people out of poverty. Even the unemployed could often live comfortably. The state paid them benefits over half their last salary, indefinitely. Unemployed Germans were often better off than the lowest paid workers in the US.

"Today, as in many other European countries, Germany’s welfare state is in retreat. Europe’s stuttering economic performance during the past decade has led governments to trim benefits and rein in public spending, hoping to push people who have become dependent on welfare back to work. To some, especially those without higher education, that means low-paid work or none at all.

"Germany gained poor residents when it attached the ex-Communist East in 1990. But poverty is rising fast in the country’s more economically developed West, too. In 1999, 11% of the Western German population lived under the poverty line defined as less than 60% of median household income. In 2005 that rose to 16%, according to the German Institute of Economic Research."

Unification with the Ex-Communist East Germany Still Weighs Heavily

"In all of Germany around 14 million people, or 17% of the population, live beyond the poverty line, which today corresponds to a monthly income of about $1,280 for a person living alone. Such poverty is far less acute than the destitution found in slums of developing countries or even in some US cities. In contrast to millions of poor Americans, all Germans have health insurance.

"’Yet for Germans, the growing split in society is a jarring break with the postwar decades. Then a ‘social market economy’ spread affluence widely by combining industrial growth with a strong welfare state. Today blue-collar workers are falling out of the broad middle class,’ says Berthold Vogel of the Hamburg Institute for Social Research. ‘I fell a long way,’ says Mr. Martin, stirring his vegetable and sausage soup with a plastic spoon After working for more than 20 years as a machine-tool component maker, he was laid off in a company restructuring in 1996. ‘I had never been unemployed in my life,’ he says. For a while he was homeless. He now has an apartment, but his health is poor. His benefits have sunk to the new Hartz 1V flat rate of about $300 a month, plus an allowance for rent and heating.

"The economic upturn of the last two years has cut Germany’s overall unemployment rate. But it has largely by-passed the low-skilled and the long-term jobless. The tasks they used to do have moved to low-cost countries.

"‘There just isn’t work for everyone anymore,’ says Wolfgang Nielsen, the volunteer head of the Wuppertal Table.

"Before volunteers set up food distribution centers – known as the ‘table movement’ in Germany – the poor didn’t starve, but often fell into debt. Mr. Nielsen says, ‘What people save on food thank to us, they can use to pay off their rent and other arrears, or to get their electricity switched back on.’ When the 57-year-old former insurance salesman set up the Wuppertal Table in 1995, it was one of the first in Germany. The idea of handing out surplus groceries had crossed the Atlantic from New York when social workers saw City Harvest food charity.

"Today Europe’s biggest economy has 700 towns with ‘tables’ or volunteer groups that collect food that supermarkets would otherwise throw away, and give it to the needy. The Wuppertal Table runs the roving van as well as a canteen, a fresh food stall and even a medical service, and feeds more than 700 people a day.

"At first, Mr. Nielsen says, he struggled to persuade Wuppertal’s businesses, citizens and politicians to support the idea. People were used to funding the welfare state with their taxes and didn’t think extra charity was needed. A breakthrough came when car-maker Daimler AG made a gift of 100 Mercedes vans to the budding German table movement, paving the way for other corporation donations. The Table’s 250-odd helpers are mostly volunteers. ’Tables are in. It’s chic to be involved with them,’ Mr. Nielsen says. He says he is not Mother Theresa and never planned to work long hours for free. ‘It just worked out that way.’

"Every morning, supermarkets and bakeries let Mr. Nielsen’s volunteers carry off unwanted stock: greens, fruit, bread, meat and other inventory that’s too near its sell-by date, has minor packaging flaws, or was just over-produced. The food is unloaded at a disused former printing shop that is now used as a food distributing center. Men and women, some with children, wait in the drizzle for the 11 a.m. food distribution.

"Adults pay a token 50 Euro cents to enter the building and fill shopping bags. The fee is meant to reduce the stigma of receiving alms."

Over the wealthy land that cannot provide dignified work that was possible 120 years ago, hangs a cloud of shame.


– from Economic Reform, November 2007