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Germany's poor count cost of recession

The Local · 23 Sep 2012, 09:53

Published: 23 Sep 2012 09:53 GMT+02:00

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As Germany belatedly feels the pinch from a crisis that has pushed most of its neighbours into recession, low-wage workers and the old-age pensioners who are being hit hardest, according to the latest four-yearly poverty report drawn up by Germany’s labour ministry.

The ministry found that the gap between rich and poor in Europe's top economy was continuing to widen. In 1998, 45 percent of Germany's total wealth was owned by the wealthiest 10 percent of the population, whereas a decade later that proportion had risen to 53 percent.

About half of all households owned just one percent of the nation’s wealth, the study found.

"Hourly wages that are no longer sufficient - even if someone is working full time - to feed a one-person household," the ministry said. It described the situation as "exacerbating the poverty risks and undermining social cohesion."

Unions argue that those very same labour market reforms which helped steel the country against the worst of the debt crisis and brought down unemployment are contributing to the ever-widening gap between rich and poor.

The absence of a legal minimum wage and the strong expansion of the low-paid job sector, and so-called "mini" jobs come at the expense of society's poorest, critics say.

Hungary's EU Commissioner, Laszlo Andor, has even said that Germany's low-wage policies have helped to prolong and deepen Europe's current crisis, because they have created some of the economic imbalances across the region that are to blame for the continent's woes.

"For the past decade, Germany has exercised an enormous degree of restraint in wages in order to become more competitive for one or two years. But that has had consequences for the other EU countries, too," Andor told the Frankfurter Allgemeine Zeitung newspaper in an interview, calling for the introduction of legal minimum wages in all sectors and wage increases.

Story continues below…

AFP/The Local/rc

The Local (news@thelocal.de)

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Your comments about this article

11:06 September 23, 2012 by Berlin fuer alles
And whilst this is happening the national media such as BILD blame Greece, Portugal, Spain and Italy and draw attention away from the real source of the problem. Top German Elites creaming from the top by virtue of the Euro making German exports competitive.
16:10 September 23, 2012 by IchBinKönig
Where is that wonderful NPR piece theLoco used to run? the one where a honey throat-ed Idiot claims the Euro would bring Europeans together in peaceful harmony? His story about the french gas station attendant that gave him a dirty look for having a German license plate. Oh the humanity! ' All things considered'. Ha. Propagandizing idiot. Where is he now with his harmony?

So far this year at the loco.

Arab Spring = Not so much

Euro Harmony = Not so Much

Global Warming = Not so much

Actual Neo Nazi threat = Not so much

Peaceful Protests = 1/100? Not so much
18:04 September 23, 2012 by Englishted
"The ministry found that the gap between rich and poor in Europe's top economy was continuing to widen. In 1998, 45 percent of Germany's total wealth was owned by the wealthiest 10 percent of the population, whereas a decade later that proportion had risen to 53 percent. 2

Hold your heads in shame those from all parties that have allowed this to happen.
19:47 September 23, 2012 by Berlin fuer alles
It is not just the average German worker who is paying for this. The Greeks, Portuguese, Irish and Spanish are also paying dearly. These people are benefiting greatly from the Euro at the cost of tax paying Europeans bailing out the single currency to keep their lucrative German export business in prime condition. Maybe the banks in Ireland should not have been bailed out by the tay payer and the bond holders (mainly German banks) take a hair-cut.
23:27 September 23, 2012 by quiller
Berlin fuer alles - that is what should have happened, they should not have been bailed out. That is the way capitalism works. A few bank failures would have focused the bank management very quickly and they would have come up with a resolution in quick time rather than have the politicians bail them out. Now they sit back in their fancy offices and sneer at Joe Public or Sean Citizen.
01:00 September 24, 2012 by lenny van
High hopes smashed yet again. Another disappointment with Germany. Instead of a few really poor people, 53% of people have to work two jobs in Germany. The other 47% spend their time thinking up new "tricks" English translation - lying, stealing and cheating) to get money. This is no welfare state.
09:56 September 24, 2012 by AlexR
Germany's poor wouldn't have been 'poor' if they have worked harder and didn't live beyond their means. But just like the Greeks and the rest of the PIGS, they are lazy, unproductive people who rely on social benefits while living above their means.

/end sarcasm
10:39 September 24, 2012 by Berlin fuer alles
German workers must retire later and work harder if they want to get themselves out of the poverty trap. Too much holidays spent abroad in sunny climates and finishing work too early. They cannot expect to maintain the standard of living they are used to having without working more, harder and more efficient. Look at most of them sitting around the beer tents in Munich drinking beer. Lazy Germans.

/ Political Broadcast on behalf of the top 10%
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