Three ideas of solving economic and social problems in Germany

 Three ideas of solving economic and social problems in Germany

Since the publication of the wealth of nations, Adam Smiths economic thought has always been regarded as the standard, and he is also regarded as the main founder of economics by many people. In fact, although Adam Smith has had a profound impact on the development of economics, he and his thought can not represent all of Economics, nor solve all the problems of economic and social development. The development of economics is the common thought of generations of economists. Apart from Adam Smith, what other economists are there in the world? Because of its rigorous style of study, Germany has always been the cradle of the birth of world economic masters.

Ludwig ahard, a former German prime minister, was also the founder of German social market economy. For a long time, the mainstream economic circle has ignored the influence of ehad on German economic development. How could Germany, defeated in World War II, realize its economic rise again on the ruins? This is inseparable from ehads efforts.

Netease Research Bureau launched the exclusive plan of Adam Smith is not the only one in the world. It listened to Liu Guangyao, the first consul general of China in Munich, exclusively narrate ahads economic thoughts and uncover the secrets behind the rise of Germany. In the previous column, we introduced in detail ehads thought of social market economy. In this issue, lets take a look at the solution of German economic and social problems after ehads resignation as prime minister.

Germany is forced to carry out in-depth reform and adjustment. This is a long and painful process. We can be sure that in this process, only by adhering to, applying and developing ahards core thoughts and theories on social market economy, and absorbing the timely advanced ideas of other economic schools in the new situation, can we continue to advance in twists and turns.

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3u3001 A tentative plan to solve the problem

Although Germany is facing many difficulties and some people are pessimistic, more Germans are still confident in the future. Many German scholars believe that if the measures are appropriate, Germany can still restore its former glory. The Germans have reason to adopt realistic optimism: Although the unified Germans are not better than other nationalities in all fields, our situation is still good. Compared with other countries in the world, the standard of living is still very high. World class infrastructure. Entrepreneurs are innovative. The workers have good qualities. The productivity of enterprises is very high. Foreign countries praised the quality of German products and the reliability of German business partners. The German mark is the strongest currency in the European Monetary Union. In a word: this country has huge resources. However, only a revival of the market economy can mobilize it. (Note 1) because Germany always adheres to the industrial based economic model, Germany has also become an industrial power with remarkable achievements in the world. German industry is highly competitive and innovative. (see German industrial strategy 2030). Germany has high-quality human resources, advanced science and technology and a solid material foundation to solve problems.

German scholars have many ideas about how to solve the current problems. In a word, it mainly includes:

In autumn 2014, a policy review seminar was held in Leipzig, Germany. People can see a very obvious trend at the meeting: in the guiding ideology, it is not to better implement the freedom of competition, further improve the market economy, more effectively implement the rule of law, but to more emphasize social justice, welfare state and the concept of democracy with unlimited content. More and more people have come to the conclusion that the state must intervene in the economy more resolutely than in the past.

People who hold such views think that, 1. Ehad, the grandfather of social market economy, has been dead for many years. They believed that ehad did make great contributions to the German Renaissance, but now the domestic and international situation in Germany has undergone profound changes. His thoughts and theories are out of date and are no longer suitable for the current situation and actual situation in Germany, so it is impossible to continue to use them, let alone use ehads thoughts and theories to solve todays economic and social problems. People must solve the current problems with new ideas and theories that adapt to the current characteristics. People cant stick to the conventions and reverse the history. 2. At present, the problems in Germany are the obvious polarization, the great disparity between the rich and the poor, the unfair distribution of wealth. We should kill the rich to help the poor, impose heavy taxes on the rich, and increase social welfare and subsidies for the middle and lower class people. Only in this way can we ease social conflicts. We need to build a more mature and all inclusive welfare state.

(two) the second assumption. Only in this way can the root cause be cured and Germany return to the right path.

I think its more important to cure the root cause than to cure the symptoms. It is pointed out that the root cause of all the problems in Germany today is that the Social Democratic Party, which took part in politics and took charge of politics after 1966, gradually deviated from and abandoned Erhards thoughts and theories, and mistakenly introduced and used Keynesian thoughts and theories, resulting in a pile of economic and social problems, which made Germany in a dilemma. If we want to solve todays problems in Germany and get the economy and society out of trouble, we have no other way but to use ehads thoughts and theories again.

uff083uff09 The third scenario. Neither can we stick to the rules, continue on the current road, nor fully return to ehads thoughts and theories. The correct approach should be to adhere to the core content of Erhards thought and theory, and to make necessary modifications and supplements in theory and policy according to the current domestic and foreign political and economic situation. In this way, Germany can step out of the dilemma and its future is still bright.

The specter of decline is not only a threat, but also an opportunity as a result, said German scholar Hugo Miller Vogel Faced with the challenges of globalization and information technology, it is impossible to copy the policy of ahard alone. However, the principles of economic and social policy of 1948, such as competition, performance and risk awareness, self responsibility and self-awareness, were also correct in 1998. As long as the Germans want to do so and rely on these principles, they can correct the wrong development of the past decade again. With these principles, the German model can be revitalized. . (Note 2) more and more people agree with this dialectical view and analysis.

1. Inheriting and carrying forward the effective ideas and propositions in ahards thoughts.

(1) We will continue to give full play to the full, orderly, fair and free competition in the market and other inherent functions of the market economy, give full play to peoples initiative, enthusiasm and creativity, and make them work tirelessly for their own interests. According to Miller Fogg, man is man. In the working world, the driving force for success is not what to do for others, but the most reliable one is to work for your own interests. In this way, people can be more competitive, more effective, self responsible and innovative.

(2) The principle of giving priority to efficiency and giving consideration to fairness shall be implemented. At different stages of economic development, the scale of mastering this principle should be adjusted, but the order should not be reversed. We need to deal with the relationship between economic and social policies so that they can promote each other and complement each other.

(3) Firmly oppose the welfare state. The author believes that it is foolish and dangerous to take all the measures from birth to death, which will inevitably lead to the destruction of a nation and a country. Gradually and appropriately reform the all inclusive welfare system, reduce the welfare treatment in some areas, take necessary measures to encourage people to get employment and improve their lives through their own hard work.

2. We should vigorously promote scientific and technological innovation, realize industry 4.0, and occupy the commanding heights in the new technological revolution. German industrial strategy 2030 profoundly summarizes the advantages and problems of German economy and science and technology, and puts forward the development direction and goal. Machine to Internet connectivity (industry 4.0) is another extremely important breakthrough technology, the document said. The distinction between the real world of machines and the virtual world of the Internet is disappearing. The scientific and technological revolution will greatly promote the sustainable development of the economy, increase material wealth and make the national economic cake bigger and better.

3. We should reform the rigid labor market policy and implement a positive employment policy. We should implement the principle of pay for work and more work, more work, more gains. We should firmly oppose and abandon the idea and theory of absolute equalitarianism. Different fields, different enterprises and different contributions should have reasonable differences in personal wages and incomes.

4. We should resolutely and prudently adjust and reform the rigid social, economic and industrial structure to make it more dynamic. While consolidating the traditional advantages of the secondary industry, we should vigorously develop the tertiary industry.

A third view also holds that it has been more than 50 years since ehad stepped down in 1966. Over the past half century, profound changes have taken place in Germanys politics and economy, in the worlds politics and economy, in Germanys thoughts, and in the thoughts of people from all over the world. At that time, ahards thought and theory was indeed a correct one. However, a kind of thought and theory should be properly developed or revised according to the changes of the situation.

One of the changes over the past 50 years has been the unstoppable wave of globalization, which no region or country can ignore. The economies of all countries in the world have already become one, one and the same. They have become a huge economic community, a community of interests and a community of common destiny. In this community, countries are strong or weak, big or small, and religious beliefs and values vary widely. Any country, especially one with a high degree of dependence on foreign trade, like Germany, cannot operate in full accordance with its past policies, as in the past, and must make appropriate adjustments accordingly.

Some German scholars believe that, on the whole, people should use three hands to promote, promote, command, regulate and manage the development of market economy at the same time when solving the current economic problems and on the premise of persisting in the order policy of Germany.

The first hand is undoubtedly the hand that Adam Smith pointed out in the wealth of nations to strive for benefits in the free competitive market. However, this invisible hand should be guided and restricted as necessary and appropriate, and should not be allowed to be laissez faire or unrestrained.

In 1776, Smith put forward the famous proposition of invisible hand in the market economy in his masterpiece wealth of nations. There is a changing process in peoples understanding and interpretation of the invisible hand. The original meaning is that individuals only consider their own interests in economic life, driven by invisible hand, that is, through the role of division of labor and market, they can not only get profits, but also make the country accumulate wealth. Later, invisible hand became an image language used to express the complete competition mode in the capitalist economic system. The main characteristics of this mode are that under the premise of private ownership, everyone for himself has the freedom to obtain market information, the freedom to compete, the freedom to contract, and there is no need for the government to intervene in economic activities. Under the condition of full competition, producers pursue profit maximization and consumers pursue utility maximization. The relationship between supply and demand in the market determines and adjusts the price of products. Through free competition, the whole economic system has reached a general equilibrium. In the process of pursuing each participants private interests, invisible hand will bring benefits to them and guide the whole economic process invisibly.

It should be acknowledged that under the guidance of Smiths thought and theory, the western economy has made great progress, but it suffered a heavy setback at the end of the 1920s. The capitalist world economy broke out an unprecedented crisis. People have seen that the function of this hand is no longer effective, and it seems powerless to solve the serious crisis in the market.

The second hand is the function and function of the state. Smith emphasized the command role of the invisible hand in the market and regarded the state as a night police state. Keynesianism claims that the state can directly intervene and manage the economy, and can implement total amount control and macro management. It must be emphasized here that the Neo liberalists in Germany all advocate a strong country in the social market economy, but they are different from Smith and Keynes in the status and role of the country. Ahad firmly opposed state intervention and economic intervention. Miller - amark advocated that there should be a proper prosperity policy and the state can intervene properly. Freiburg School believes that the task of a strong country is to make order policy and ensure the implementation of competition policy. A healthy and correct order policy and competition policy can solve all kinds of problems in the market.

The third hand is put forward by Smith in the theory of moral sentiment.

In a word, today, Germany is faced with various serious problems and difficulties, such as the burden of a cow and the difficulty of moving forward. Germany is forced to carry out in-depth reform and adjustment. This is a long and painful process. We can be sure that in this process, only by adhering to, applying and developing ehads core thoughts and theories on social market economy, and absorbing the timely advanced ideas of other economic schools in the new situation, can we continue to advance in twists and turns. However, the German people must pay a heavy price for this.


(2) Same as above, page 12

(3) Smith, British: on moral sentiment, translated by Jiang Ziqiang et al

Hebei people. In 1965, he graduated from the Department of western languages and literature of Peking University, majoring in German. From November 1983 to January 1985, he studied in the first training course for Economic Research cadres of the Ministry of foreign affairs and graduated with excellent results. From 1976 to 1982, he worked in the Embassy in Austria as the deputy director of the research office. From 1985 to 1989, he worked in the Research Office of the Embassy in Germany, any secretary, in charge of economic research. From 1990 to 1993, he worked in the world economy Office of the Policy Research Office of the Ministry of foreign affairs and served as the director. From 1993 to 1996, he worked in the Embassy in Germany as counsellor and director of the research office. From 1996 to 2001, he was the first consul general in Munich. He has worked in Germany and Austria for 18 years and has studied in depth the history, politics, economy, culture, bilateral relations between Germany and Austria as well as the formation and development of the European Union.

Adam Smith is not the only one in the world to look back:

Issue 1: why Germany can rise after World War II from the perspective of ehads economic thoughts > >

Issue 2: ehads unique way of Scientific Research > >

Issue 3: does ahard have his own economic theory? >

Issue 4: ehad and German monetary reform > >

Issue 6: William liger, ahards seven life mentors > >

Issue 7: Franz Oppenheim, ahards seven life mentors > >

Issue 8: seven life mentors of ehad -- William wellshoven > >

Issue 9: seven life mentors of ahard: Andreas Fugate, Carl teodore von eberg, Adolf jundt, Fritz Schmidt > >

Issue 10: Liszts criticism of Adam Smith > >

No. 11: Adam Smiths influence on ehads thoughts > >

Issue 12: the meaning of ahads social market economy > >

Issue 13: ahards values > >

Issue 14: ehads economic philosophy > >

Issue 15: how to understand the society of social market economy > >

Issue 16: ehads social ethics and psychology > >

Issue 17: ehads Thoughts on competition and monopoly Relations > >

Issue 18: ehads Thoughts on the relationship between economic policy and social policy > >

Issue 19: ehads Thoughts on production and distribution > >

Issue 20: ehads Thoughts on common prosperity >

Issue 21: ehad and the composite society > >

Issue 22: ehad and Adenauer - partners and rivals > >

Issue 23: ehad and Okun - theory close relatives, but no affiliation > >

Issue 24: ehad and Alfred Miller - amark: close comrades in arms > >

Issue 25: ehad and Schiller - opposites and commonalities > >

No. 26: ehad and William lepke -- sincere friends > >

No. 28: ehads family and adolescence > >

No. 29: ehads way to study > >

Issue 30: ehads character and historical status > >

Issue 32: the development stage, existing problems and solutions of German social market economy (I) > >

Issue 33: the development stage, existing problems and solutions of German social market economy (2) > >

Issue 34: the development stage, existing problems and solutions of German social market economy (3) > >

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