When Germany's economy, fueled by a massive trade surplus, grew nearly 9 percent (annualized) in the third quarter of 2010, it provoked envy on this side of the ocean. Why couldn't the United States, wallowing in one-percent growth, emulate the vaunted German model? Why were we exporting jobs and importing products while Germany was exporting products and keeping good jobs?
Germany's juggernaut is unique in ways the United States can't emulate easily. German consumers are as thrifty as Americans are ravenous. That means that German producers have to look overseas for big markets whereas American producers live in the world's biggest market, which makes exporting less natural or appealing for firms making new products and services. Indeed, 99 percent of US companies don't export at all. We might also mention currency imbalances that keep German goods artificially cheap, and American goods artificially expensive, due to Euro debt troubles and Chinese manipulation, respectively.
But Germany isn't unique in this way: Its companies are always looking to cut costs. That's why BMW, a firm synonymous with German engineering skill, is sending a thousand jobs to ... the United States.
You read a lot of stories about how the U.S. is losing jobs to globalization. But the deep recession has forced factory workers to accept lower wages. And cheaper labor attracts rich multinational companies, whether the cheap labor is in Delhi or Detroit. (As the article points out, US factories also help BMW mute the effects of currency changes.)