World Economic News
Germany Has Lost 3.8 Million Real Jobs Since 1991
In a survey mandated by the previous Schroeder government, and released Jan. 5, the German Institute of Labor and Employment Research (IAB), together with the Institute of Labor and Technology (IAT), reported that in the past 15 years, 3.8 million real and fully insured jobs were axed in Germany, and only partly replaced by part-time or uninsured mini-jobs. This implies that several hundred billions of d-marks and (from 2002 on) of euros have not been paid into the social and health-insurance system of Germany, during this period.
The same survey added another finding to the long list of flops related to the Hartz I-IV "reforms": Of the 276,000 "Ich AGs" (I-Inc.'s), formed under this legislation with the illusion that subsidizing these mini start-ups, new jobs would be created, 76% serve the sole purpose of sustaining the "firm-owner"there is no employment of anyone else. Some 210,000 persons are kept out of the unemployment statistics for up to three years of government co-funding by this means.
Furthermore, the survey found that the mass-creation of new low-income, low-skill jobs, as propagated by market radicals, simply is not possible, because there is an under-supply of jobs anyway. Moreover, 45% of low-income, low-skill jobs are already occupied by people with higher skills, so that unemployed Germans with lower skills often have no chance of getting a job that corresponds to their skills. The same pattern also shows a drastic under-supply of high-skill jobs.
Nippon Head Warns Against Bubble Economy
As the Japanese Nikkei average barrelled above the 15,000 level for the first time in five years, accompanied by calls from Forbes to the Wall Street Journal recommending that investors put money into Japanese stocks and real estate, Hiroshi Okuda, chairman of the Nippon Keidanren (Japan Business Federation) stepped forward to draw a line. Okuda asserted, as reported by Asahi Shimbun Jan. 3, "It seems Japan as a whole has started to develop an atmosphere of a bubble economy. Japan as a whole is about to turn into a nation obsessed with money. I can only hope the situation does not develop into a second economic bubble." Okuda is referencing the first bubble of a stock and real estate build-up, whose puncture in the early 1990s shook Japan.
Okuda offered his view in response to a question posed by Japanese Prime Minister Junichiro Koizumi at a meeting of the Council on Economic and Fiscal Policy, who asked, "Is the current economic situation worrisome?"