Ahhh Germany. It’s the place where BMW, Ramstein, and
FKK (nudist) culture, and BMW cars were born. Nevertheless, Germany has something even more
important than all of that and that is that it is the world’s ultimate factory. Yep, you heard that right… and I know what
you are thinking… “Isn’t China the country where TV screens,
mobile phones and, practically, every good we buy is made?” Well, that’s not entirely true. Now, of course, China does lead the charge
when it comes to exports. But… do you know what? In order to manufacture all those products,
they need to import a lot of things from abroad. Germany, instead, sells way more that what
it buys. In fact, 1 of every 10 products sold on the
international market is made in this country which has a population 15 times smaller than
China. Yes, we all know those big car companies:
BMW, Audi or VOLKSWAGEN… But there is way more than that! Don’t you believe me? Well, consider you mobile phone. Sure, I know it says right there ‘Assembled
in the People’s Republic of China’ or something similar. But, and I’m not recommending this, but
if you did open it up you are going to find a lot of microchips… As an example here , the little chip that
makes your screen rotate when you move the phone is made, most likely, by a German company
called BOSCH SENSORTECH. But not only that! Many of the robots used inside these Chinese
factories assembling the phones are probably made in Germany. In other words, in Germany, they manufacture
the things that go inside of the things manufactured by others. And now you might be wondering… How is that possible? Factories should be built in places with cheap
labour costs, right? I mean how is that possible that Germany,
with relatively high salaries, is such an industrial powerhouse? Well, today, we are going to answer that question. But before we do, let’s take a look back
at history… ORDOLIBERALISM After World War II, Europe was pretty darn
destroyed. Countries like Italy, France and Western Germany
(which was the capitalist side of Germany), got a massive money grant from their beloved
friend, Uncle Sam. But wait a minute because each of those countries
used that money in really different ways! The French president, for instance, was this
guy you see on the screen. General Charles de Gaulle. De Gaulle came from the military and was no
friend of private companies. His political creed, the so-called DIRIGISME,
was about nationalizing big businesses and leading the whole country’s economy as if
it was an army! In Western Germany they choose a different
path… Both the Chancellor KONRAD ADENAUER and his
finance minister, LUDWIG ERHARD, spent years thinking about their own economic system. A mixture between the competition of free
market capitalism and the safety net provided by the government. Then they decided to give this system the
worst name ever… They called it ORDOLIBERALISM or SOCIAL MARKET
ECONOMY. “Competition is the most promising means
to achieve and secure prosperity”—Ludwig Erhard In other words… While De Gaulle centralized the economy in
Paris, Konrad Adenauer designed a system where the government would put into place a set
of conditions, but the other players would make their own decisions. This explains why in Germany, trade unions,
regional governments and, of course, companies, are so important. And now you might be wondering… What are the keys for that system to work? And has it really worked out? Well let’s get right into that. AN STABLE CURRENCY I’m pretty sure you’ve heard at some point
some economist saying that devaluing a currency boosts exports, right? For instance, imagine we have a shoe manufacturing
facility in Mexico and we want to sell a pair of shoes to the American market. Let’s say, the price for those shoes is
2000 Mexican Pesos. At the time we are making this video those
200 pesos equal to 110 USD. But let’s say that, all of a sudden, the
Mexican Central Bank decides to print money and, therefore, devalue its currency. From one day to the next, that pair of shoes
could be worth 90 USD. Therefore, it would be easier to sell it abroad. This is a theory supported by most governments
today. Nevertheless, the German Government did exactly
the opposite. During the second half of the 20th century
the GERMAN MARK became one of the most stable currency on the planet. And this might lead you to wonder… How is it possible that Germany could export
so much when their products are not that cheap? Well… let’s get back to the shoes example. But this time I’m going to tell you the
story of a real company. This is a company from the North of Germany
and it’s called DESMA. It is a SME with around 200 staff. They started out right after the war in 1946,
and they specialized in making machines for shoe manufacturing. In order to do this, they needed to import
lots of machines from the United States. Thanks to having a stable currency, the price
for importing those machines was relatively low. They decided to rent a facility – at the end
of the day, since there was no inflation, rents would not go up, and they could calculate
the future cost reliably. But not only that! Since German companies couldn’t offer lower
prices, DESMA had to innovate. In 1960, they invested in state of the art
technologies to manufacture rubber-made soles. Ten years later, DESMA was the world leader
in machines to make PVC soles. It’s likely that the sole of the shoes you
are wearing today was made with a DESMA machine. This company, with 200 staff, sells to every
country in the world… including China. And this is just one example of the thousands
of small and medium sized companies, the so-called MITTELSTAND, that made up Germany. And yes, I know, I know… In 2002, the Germans abandoned the Mark and
adopted the EURO as their currency. But think about it… while other countries
like Spain were using weaker currencies before, Germany had had a strong currency for decades. That means, that in 2002, German companies
were already more competitive than anyone else’s. But hold on a minute because there are many
other things that can explain the success of the German model, so let’s dig into those
now. THE EDUCATIONAL SYSTEM I know what you are going to say now… Come on, Simon! Germany isn’t really famous for its educational
system! Just check out the PISA report… Germany is not even in the top 10! But then again, German students can find a
job right after they finish their studies. So, why is this? Well, the the answer is in their vocational
training system. Let’s imagine that you are high school student
in Germany and you don’t want to go to university. So instead you study to become a plumber. Well… from the first moment, you are already
working for a company which has an arrangement with the school. This means, from Monday to Wednesday, you
go to a classroom and from Thursday to Friday, you go the company’s workshop. There, you would be trained by the experience
plumbers and you would even get a small salary of between 300 or 500 dollars a month. And this salary is pretty important… The simple fact that the company is paying
means the employer has to make the students work. Otherwise, the firm will be throwing money
away… And the outcome of this is that German students
know how it is to be in a real life working environment. In fact, many of them remain in the company
where they did their training. And, of course, those German firms, in exchange,
get well trained workers. And now that we are talking about workers,
let’s talk about another key piece on the German system… GERMAN TRADE UNIONS In other countries like France or Spain, most
of the labour laws are made by parliament. But not so in Germany. Until 2015, Germans didn’t even have a minimum
wage… Salaries were negotiated by trade unions and
employers. In Germany, syndicates are extremely important. Actually, those big companies like AUDI or
BMW, with more than 2000 workers, are required to have union representatives on their administrative
board. Consider this: Siemens has 10 shareholder
representatives on their board and, therefore, they must have 10 people representing the
workers! Remember this one because it makes a big difference! In Spain, for instance, a big company like
TELEFONICA has no trade union representatives on their board of administration. Trade unions can only participate in another
body called the “company council”. And they can only speak about matters that
affect salaries or working conditions. By contrast, in Germany, trade unions have
a voice on every decision the company makes. When SIEMENS wants to start operating in a
new market, or launch a new product, they have to ask the shareholders… and the trade
unions. And now you might be wondering… Is this just bad news for the companies? We pretty much take for granted that unions
are the enemy of a company, right? Well, it doesn’t have to be that way… Think about it. Thanks to this set up, SIEMENS and BMW workers
know whether if the company is making or losing money. And, of course, when things are going bad
for the company, they can make compromises, like reducing their working hours instead
of being fired. “Opel to cut working hours at German facilities” This explains why during the financial crisis
of 2008, German companies didn’t fire a large number of people. And this is good for the workers and the company. But wait a minute because I know what you
are thinking! Those German trade unions are collaborating
with big capitalists in order to exploit the workers! Right? Right? Well… the answer there is certainly NO. The reality is that average wage in Germany
is around $3,400 dollars a month. That’s higher than the state of New York! And that’s in a country with a pretty affordable
cost of living. A flat in Berlin is half the price of a flat
in New York City. And despite all of this Germany maintains
its position as the third biggest country when it comes to exports. So now the question is… Do you believe your country could benefit
from the German model? Or perhaps you think these policies are impossible
to implement elsewhere? Please, leave your answers on the comment
section below! Meanwhile, if you want to know another youtube
channel that covers geopolitics, you can check out CASPIAN REPORT. Great channel. Link in the description. And of course, don’t forget to visit our
friends at the Reconsider media podcast. They provided the vocals on this video that
are not mine. And remember that we publish brand new videos
every Monday and every Thursday so subscribe to this channel and you’ll never miss any
post. Finally, if you liked this video, give us
a thumbs up and… as always, see you in the next video.

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100 thoughts on “Why is GERMANY such an INDUSTRIAL LEADER? – VisualPolitik EN”

  1. It's difficult to copy the system since you cannot copy the culture of that country, which plays the most important role.

  2. I am Indian and I love Germany… My first company was German MNC and experience is so good. My City Pune in India have more than 50 German companies and they are doing great…. Love and respect to GERMANY from India…..

  3. a world factory producing overengineered defective cars like VW BMW abd Merc that breaks dowm alot..German engineering quality is exaggerated….because they are white.

  4. Hephaestus is fire God not wind God. Metal melt because fire and heat not water, wind or dirt. And metal and fire are core of industry

  5. Doesn't explain anything more that 75%.
    Germany is big because they have a lot of "deals" to get more resources in production.
    The consequence is war in the middle east.
    Then Germany imports a lot of potential "workers" (the refugees) from there.
    And all that without even sending a single soldier into this conflict.
    They just watched Russia, Iran, USA and Turkey struggling against each other to know with whom they invest more.
    Another fact are people not officially employed by those big engineering companies: The consultants.

    They often work much much harder than any person in a 1st world country.
    Most of the time those people are grabbed by any kind of company right out of their study and used to bring "fresh new technology" (a.k.a. bleeding edge methods) into the big companies.
    They often have to learn everything by their own while being forced to come up with results. If they finish a project just the best of the best are likely to continue working for the same company.
    This means they even work all day and half night to not get sent to an unknown new place.
    Also the very best are very likely to be adopted into the company.
    But if your just gave up everything just to get a normal engineering job, how you can still think it is right?
    The problem about Germany's successive economy is, that your are forced into it and novel science often ends with a positions somewhere somehow, but not what you studied if you didn't study within a companies restrictions.
    Thus people are absolutely dependent from the companies.
    Their preference is even the biggest influence of the government's politics.
    And once you have a life, of cause you do not say anything against your company neither the overall political circumstances.
    I might be wrong, as I am earning a lot of technical experiences within any companies business, in Germany. But I am an exception from many master students being grabbed right ahead to become a consultant with 80% to 100% travel acceptance.
    On the other hand I know that the conditions are better than anywhere else, even though they are the same for bad management trying to master "the engineer's life".
    But I would never really switch to another country.
    I just know that there is no free lunch without a downside. But maybe some are avoidable afterall!

  6. United States military keeps the oceans safe for international shipping. In other words, the US taxpayer is subsidizing other nations' exports.

  7. Norway has a system that is very similar to Germany's, and it works very well for us. I'm certain that any country could implement some version of the German model that could benefit everyone involved.

  8. Blessing of uncle Sam which provided security and market both
    No paying for defence tech and a secure market with no taking back
    Sorry I forget bloody investments
    China or India or any 3rd world nation didn't get that in fact uncle Sam was always making hurdles for them
    But days are over trump is here
    Now want to see where these model will crash

  9. I think every economical-superpower can learn from another one. As a German I can tell you that it's true that we are pretty much about perfection and control when it comes to WÖRK, but our bureaucracy makes many processes (especially governmental ones) pretty ineffective. Countries like China, South-Korea or Japan are much further in that point – in Germany too many people have too much power and that makes very big projects like airports etc. pretty complicated (not by the airport itself but by the funding, approvals and all the stuff), while for example in China there is someone who says how to do it and then they build the worlds biggest airport in 5 years, which would take easily 10 years in Germany. We Germans are proud about our engineering / technology and in many subjects it's still the best on the planet, but a lot of our bigger companies are similar to other Western companies – outsourcing, outsourcing, outsourcing. Many big German companies are producing in China under German lead and with German technology – it's a lot cheaper but costs workplaces for Germans. Another good example is the life beside the work. In Germany we are working about 40 hours per week in average – that's like 10-20 hours less than comparable employees in the USA, South-Korea or Japan and beside of that supermarkets have very, very low prices compared to other countries, while the payment is on the same level. Apartments are also a lot cheaper than in the USA, South-Korea, Japan or England. Health-insurance by law is probably the best standard in Germany. Even if you need a multi-thousand € expensive infusion every month – the health-insurance will pay for it. All the services are included in our taxes. Even some plastic surgery is included by the lawful healthcare. If you lose your job in Germany, you need to report yourself as jobless and then the government will pay your rent, give you enough money for food and will even pay a basic amount of money to your pension fund. In theory nobody has to be homeless in Germany, but by the lack of inexpensive apartments it's not doable at all – but a lot of the homeless people are just too much ashamed to work with the government, though. If they would, they'd get help. In many subjects we have it good – very good… maybe too good. All these luxurious standards created a new level of crabbing… especially the after-war generation (in German: Nachkriegsgeneration) are very square.

  10. Part of Germany’s growth is their tax policy. Export sales are not taxed which drives corporations to be more export oriented for tax purposes.

  11. The German system works in Germany because Germans tend to be more culturally attuned to such ideas, it can be very difficult however to “switch lanes” or reinvent yourself in Germany. Beginning in 8th grade testing one is tracked either to the university preparatory high schools or the apprenticeship high schools (or if you do very poorly, the “I can dribble down my lower lip high schools). So in a way you are stuck on that one track. In the United States for example, if you completely screw up your high school education, you can still turn things around in a community college or other venue. You can also switch careers. Germans love stability, Americans I think are more chaotic in their society. This has an impact.

  12. Reading this comment section made me cringe. We probably have the worst customer service but okayish production. Believe me when I say that we arent hardworking. We are simply doing what we are told to.

  13. Just to throw a spanner in the works. We can't all practice ordoliberalism, every exporter needs an importer. The Germans need places like Greece, Italy, Britain and the USA to run trade deficits or the model will collapse.

  14. We're living in the 69 reich. Heil harald schmidt. Shtakalakaa Wurst fressen und fussball den ganzen tag.

  15. I think that the United States should take up the German model and the German way of doing certain things, because I believe that the United States could benefit from doing so.

  16. I would rather call it Worker Union than Trade Union, and the Company Councel is independent from their Union, but mostly working together…
    Although there is third instance, the Industrie und Handelskammer and for craftsmen the Handwerkskammer..

  17. Highly useful Informative video, comprising virtual facts and reality, I was looking such video full of information. Thanks

  18. Since trump became president, Americans have been spreading hate across the world. Every time I read the comments I se an American spitting on European counties for taking immigrants. So disgusting, Americans start wars and destroy countries and steal oli and resources from the Middle East and when people flee from the wars that Americans start they bully others for taking immigrants. Not strange that you shoot people in the streets everyday you discussing human beings. It’s true that there’s immigrants that do crimes but that’s just a minority and the rest of immigrants are against them more that anybody else. You Americans are monsters you really can’t be humans it’s not strange that the whole world hates you and laugh at you and your clown president.

  19. German cars etc are over engineered crap. You want something that's amazing but falls apart within a year? Buy German.

  20. Not anymore. In future Germany will be in decline, low population growth, globalism, lack of nationalism, high immigrant born and also bankrupcy. It's good to see arrogant Germans still enjoy their proudness not for long kraut

  21. Worry not, world, this will soon end. German governement, media and education is now run by aging Hippies. They will soon succeed in de-industrializing the country and forcing it into their illusion of eco-anarchy. The end of industry means no jobs and we all have time to grow carrots at home. There is no financial inequality – everyone is poor. With no jobs we also don't have to force our kids to learn something in school, they can run around naked all day. With no money people also won't buy cars, house heating gas/oil or holiday flights anymore – The whole family will cuddle up in one bed like it used to be in the good old times. Hard work on the technology-free field means they'll be so tired they won't feel the cold. Emission free – and no more people getting rich – Utopia!

    You think I'm crazy? Read a german newspaper..

  22. They own the top car companies, retail/food companies, one of six world media conglom, and some of the biggest banks in the world. I ♥️ Germany.

  23. Virtually any economic system can work for a time. But Capitalism reins supreme because it is less tedious and makes the consumer king. There are things to admire about Germany, yes, but government staying out of business works best. Why? Lets say cheese consumption goes up in "Utopland," then the state owned–or mostly state owned–cheese company "Cheezy-Weezy" hires more people. But what happens when consumption goes down…? The unions and politicians will refuse for the company to let go of anyone because they're basically state employees, and they'll say "think of the families that will suffer and the dads and single moms that will be reduced to beggars–have some compassion; they're your fellow citizens." The company is not making any–or not very much–profit, but that doesn't matter, thanks to politicians and unions. The government is the only institution that can run a non-profit company. I'm not exactly trying to slam Germany, this was really for socialist countries. Hope this was helpful.

  24. America should copy it, it is funny, i feel like most people want it but are fed endless bull and they they don't. Like everyone is like "the 50s were so good for the economy", ignoring the part about massive union membership

  25. I am a German and have the feeling that more and more German quality and the customs is lost. The reason we have more and more politicians who do not listen to the people and simply determine alkes alone, we gave an immigration problem, 14 million people are refugees or simply immigrants who want to earn money. We have felt too many useless professions. We use the gold and money, not what we have. We are getting more and more crimes that overwhelms the police and most of the time foreigners are responsible. We invest in wrong things and our school system is similar to what it was 30-40 years ago. Lessons are getting worse and there are more students who do not feel like going to school because they get too much useless knowledge in their heads and always have little time. The teachers are also old. Some jobs are not highly regarded even though they need to be. Example: Many teachers do not want to become that because they know that it is the most stressful job and a lot of work and effort is complicated. German children tend to behave like an antisocial. Not all but a big part it is already. We only have success in the auto trade (I believe in arms trading) electronics and quality of the products. More and more is being built for refugees and immigrants. But we always have to put ourselves in the background. Many Germans have emigrated because they do not want Germany as it is jz. And I'm not a nazi, by the way, I'm just saying things that are right oh and in the future we havent enough money

  26. German students find a job right after their study…..haha right, good joke. That was back then, before the Uuro. Nowadays, even STEM field students with good grades have to apply for ages before entering the market…

  27. German manufacturing, 90% myth, 10% truth. My Audi Q5 had a bad pressure switch causing AC to fail and a faulty turbocharger with loose wastegate at 55k. Yeah, junk. 100% Made in Germany.

    Also never heard of any reputable internet or semiconductor or AI companies from Germany. VW is well known for cheating emission tests though.

    I think Germany is gonna be fine making machinery and assembly lines, but nothing avant garde.

    China on the other hand is on the upswing, DJI, Huawei, Xiaomi, OnePlus, Alibaba, Tencent, Bytedance, supercomputer, quantum computing and communications, controlled fusion, space programs, hypersonic scramjet, AI, robotics, human machine interface, on and on and on. More patents filed and research papers published and quoted than all the other countries except USA, who still utilizes capital market the best to attract foreign talents to do the advanced research for them, including many Chinese.

  28. As a German it's kinda flattering to see such a clip and all the kind remarks in the commentary section. But I must emphasize that Germany's success is based on economic security. Germans call it "Sicherheitsdenken" which means "security thinking". Everything has to be super safe. Germans are interested in one thing only: STABILITY. The Problem: They achieve it by a monstrous burocracy and controls in almist all aspects of life and they really overdo it, believe me! If you own a piece of land and you want to build a dog cabin of 4 sqm you better apply for a permission and wait for the three mandatory inspections before you even think of building that dog cabon or you'll be fined. In many parts of life government controls and the burocracy is so terrible that you really ask yourself weather you're still a free citizen. Also: Major changes to the tax or judiciary system require a two-third-majority in both chambers of parliament which is impossible to achieve. The Germans have created a monstrous burocracy and a political system that is impossible to reform. Things might go relatively well at the moment but in the long run Germany fails because other countries can adapt to a fast changing world much quicker than we can.

  29. Thats why i dont undertsand why pro-Brexit voters say that britain could live without europe. When there is a country which can live without europe is clearly germany .just saying.

  30. i guess the grass is always greener on the other side^^ i'm really happy living here, i've seen a lot of the world and germany is really one of the best places to live ( for me), but holy moly, the endless road construction sites, the horrible, truly horrible bike lane conditions, the glacier like speed of our administrative bodies, the 4g coverage in rural areas, the setup of our public transport system…maybe thats what makes me german 😀 complaining all the time

  31. "General Jarlz Deggel"? That's not how you pronounce it. Since it's a name that comes up pretty often when we "take a look back at history" maybe we should take the time to learn how to read that properly. French is my first language so I will help you correct that;

    In french, "Charles" is pronounced "Sharl"
    "de" is pronounced "duh"
    "Gaulle" is pronounded "Goal"

    https://www.youtube.com/watch?v=Yr28HxhpFRQ

  32. Great educational system!
    Me as a German: HAHAHAAA. you serious?

    I think this needs the disclaimer good higher education system.

  33. I'm from Croatia, a country with blatant corruption issues and a botched privatization attempt back in the late 90's and early 2000's. Our former industrial giants, Končar and Đuro Đaković (both of which have had thousands of employees) completely dropped the ball during the shift to a market economy. There aren't many other industries here that have had some sort of impact on our economy (other than dragging it down), and most of those that have are food-related. Our transportation systems are abysmal, and the minorities try their damnedest to further accentuate this problem by blocking town projects that have received EU funding.

    Honestly, the only things that could help us are 1) curbing minority rights (quite literally, they're opposed to any sort of development), 2) dragging in some foreign professionals (most of our's emigrated) with high salaries and having them teach our vocational students (you can probably imagine how this would be problematic) and 3) praying for a miracle to happen so that something finally stands up to the rampant corruption.

    Only after these 3 can literally ANYTHING be done to help the nation, and seeing how there probably wouldn't be much reason for the newly educated to stick around, seeing how other countries definitely have better job opportunities (with higher salaries and more choice, again, our industrial giants have really crumbled), who can say if it would ever even pay off. In short, we have a hail mary's chance in a hail mary's chance to ever recover and start developing.

  34. Good lord has this video aged poorly…>>>affordable cost of living, with a flat in Berlin costing half the rent of one in New York<<< was a thing around 2–3 years ago. Nowadays the prices for flats and what not have increased by around 30 to 50 percent in most areas while salaries have comparatively stayed the same or increased by just about 6% in the same amount of time.

  35. As a german it is a pleasure to hear and read all these positive comments. I also learned my Job in the dual system as a base for my studies afterwards and would recommend it to everyone else to do so. Especially to every other nation to implement such a dual sytem. I really appreciate living in this social democratic country and therefore I am really thankful. One of the few negative decisions the german government made in the last few years was to abolish the military service. Not because of the military service itself but because of the social service which was connected with it and which compelled more young people to work in a Social Institution for 9 Months or a year.

  36. why germany so rich? simple they dont have a monster army to fed on,and tax payer money's sucking vampire like military industrial complex kept in check.

  37. A pair of shoes costs less than 10 bucks to make – most shoes even less than 5! – including everything, even shipping!
    It's the brand name that make you pay 100+ for a pair of shoes!

  38. Im very pleased to read nearly no Nazi-things in the comments. Thank you world for distinguishing betwenn the old Görmäny and the modern Germany…

  39. How come you decided to wear the least German shirt there is when recording this video? Anyway, not bad, i.e., great, stuff. Thanks.

  40. Now imagine we would actually invest into our education 😀 Seriously, our facilities are run down, we dont have enough teachers, schools dont have money, they dont get backed by the cities they are in… Its horrible seeing that, but thank god we still have our knack for math and our MINT-Schools to support those pupils with passionate and well read techers 🙂

  41. It's interesting that China's industrial "over capacity" has been used recently by some as a derogatory remark while Germany's industrial "over capacity" has always been held as a model in the U.S. and it has strived for the same thing. I wonder what the world would be like if all countries achieved industrial "over capacity".

  42. 300-500 dollars is wrong its really about what you do but on the most part you get more like 600 euros some even start at a 1000
    still great video

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