Is Europe's Strongest Economy Actually The Cause Of The Crisis?

Germany is Europe's only country that has roared back to pre-crisis employment numbers. Still, the International Labor Organization accuses German exporters of being no less than the structural cause of the current euro zone problems.

Germany is the Big Man of Europe, for better or worse (hpeguk)
Germany is the Big Man of Europe, for better or worse (hpeguk)
Catherine Chatignoux

PARIS - Germany's relatively low unemployment rate didn't stop the International Labor Organization (ILO) this week from delivering a brutal assessment of the European powerhouse.

Yes, the ILO 2012 report on global employment trends cites Germany as both the most powerful country in Europe and, along with Australia, the only developed country that has managed to boost its unemployment rate to below pre-crisis levels. But the authors of the report, presented on Tuesday, also accuse Germany of being no less than the cause of the current euro zone problems.

"Rising competitiveness of German exporters has increasingly been identified as the structural cause underlying the recent difficulties in the euro area," they denounced in an accompanying article inside the report.

The ILO targeted the "deflationary" wage policy implemented in Germany after reunification: "As German unit labor costs were falling relative to those of competitors over the past decade, growth came under pressure in these economies, with adverse consequences for the sustainability of public finances." "More importantly," adds the ILO, "crisis countries were barred from using the export route to make up for the shortfall in domestic demand as their manufacturing sector could not benefit from stronger aggregate demand in Germany."

In Germany, the increase in private consumption was more than 1% lower than other euro zone countries between 1995 and 2001. The strategy which aimed to return the country to productivity "created conditions for a prolonged economic slump as other member countries increasingly see only even harsher wage deflation policies as a solution to their lack of competitiveness." This was the last straw, according to the ILO's report, as the "internal devaluation" overly affected employees in the service sector, leaving manufacturing costs high.

Little has been done, on the other hand, to improve productivity itself.

Read the original article in French

Photo - hpeguk

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Saving The Planet Is Really A Question Of Dopamine

Our carelessness toward the environment could be due, in part, to the functioning of a very primitive area of our brain: the striatum.

Ad scuba-diver and brain coral

Stefano Lupieri

PARIS — Almost every week, a new scientific study alerts us to the degradation of the environment. And yet, we continue not to change anything fundamental in our systems of production and habits of consumption. Are we all suffering from blindness, or poisoned by denial?

In his popular books Le Bug humain (The Human Bug) and Où est le sens? (Where is the Sense?), Sébastien Bohler, a journalist in neuroscience and psychology, provides a much more rational explanation: The mechanism responsible for our propensity to destroy our natural environment is in fact a small, very deep and very primitive structure of our brain called the striatum.

This regulator of human motivation seems to have been programmed to favor behaviors that ensure the survival of the species.

Addictions to sex and social media

Since the dawn of humanity, gathering information about our environment, feeding ourselves, ensuring the transmission of our genes through sexual intercourse and asserting our social status have all been rewarded with a shot of dopamine, the 'pleasure hormone.'

Nothing has changed since then; except that, in our society of excess, there is no limit to the satisfaction of these needs. This leads to the overconsumption of food and addictions to everything from sex to social media — which together account for much of the world's destructive agricultural and energy practices.

No matter how much we realize that this is leading to our downfall, we can't help but relapse because we are prisoners of the dopamine pump in the striatum, which cannot be switched off.

Transverse section of striatum from a structural MRI image

Lindsay Hanford and Geoff B Hall via Wikipedia

Tweaking genetics 

According to Bohler, the only way out is to encourage the emergence of new values of sobriety, altruism and slowness. If adopted, these more sustainable notions could be recognized by the striatum as new sources of dopamine reward. But there's the challenge of promoting inspiring stories that infuse them with value.

Take the photo-collage exhibition "J'agis ici... et je m'y colle" ("I'm taking action here... and I'm sticking to it"), a collection of life-size portraits of residents committed to the energy transition, displayed on the walls of the French coastal city of La Rochelle.

Backed by the French National Center for Street Arts, photographer Martin Charpentier may be employing artistic techniques, but he's also tinkering with neuroscience in the process.

Les Echos
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