It is not everyday that a husband and wife team-she an economist, he a physicist turned politician and now probably Germany's new finance minister-co-author a book. It is even more unusual when they actually write it themselves. This is the book's strong point. Its weak point is the incessant jargon: "rebuilding," "inclusiveness," "harmonisation" and so on. Don't Be Afraid of Globalisation (JHW Diete Nachf) is a Red-Green manifesto; although published several months ago, it provides a useful guide to the intellectual underpinnings of Germany's new government. Economic issues are set firmly in their political and ecological context. But Christa M?ller and Oskar Lafontaine retain a social-democratic bullishness about growth and conventional full employment. But this is not a simple return to pure Keynesianism.
The authors certainly believe in macroeconomics: "Learn from the US!" is their cry (at least in macroeconomic policy). New jobs can only be created with strong economic growth and with monetary policies designed to increase domestic demand and productivity-related earnings. According to this view, Kohl's government failed when it did not reduce Germany's debt before 1990. Moreover, it allowed earnings to rise faster than productivity.
The authors want a new framework for "a social and ecological market economy"; they believe that there is a wrong and a right economic policy, not simply an antiquated and a modern one, as Schr?der once said. Their analysis of the new rules needed for a deregulated global economy is timely in the wake of the Asia crisis and the IMF's interventions. The authors are staking a claim to lead the debate on modernisation and they do so with an endless stream of tables and statistics. This is not a shallow rant against neo-liberalism.
Not surprisingly, they argue that lowering costs is not the answer to globalisation and invoke the "race to the bottom" of the 1930s and all that flowed from that. The right answer to globalisation is raising productivity.
The authors want to reclaim green themes for the Social Democrats. Their approach to jobs and growth is surprisingly optimistic. They argue that in principle, the welfare state does not need to be restructured. And they are not willing to accept a knowledge society in which only a fraction of people have jobs. The idea that in such a society the role of politics is simply to soften some of the resulting inequalities is dismissed as cynical.
The book includes a frontal attack on Germany's static political structures as well as its inert businessmen. The authors recommend concentrating on long-life, high-quality goods. Only when a new car uses considerably less fuel or lasts longer is it a real innovation. Long-life products, rather than cheap mass production, offer economic and environmental benefits. And they would also help to revive "made in Germany" as a mark of quality.
Politics should only interfere in environmental questions when it is absolutely necessary; Schr?der would agree with that. A reform of taxes which would reduce the price of labour and increase the price of energy is long overdue. But with M?ller and Lafontaine (unlike some Greens), this does not involve a philosophy of renunciation and reduced consumption.
This is also one of the weaknesses of the book.The authors seem afraid to address the issue of how to define new limits for growth, because that would contradict their social-democratic optimism about progress. The problem of growth would benefit from a constructive debate with the Greens. The two parties have different political traditions and arguments on growth, but perhaps they are both right.
M?ller and Lafontaine complain that in a society where the media have crowded out parents and church as mediators of values, economic values such as money, success and power have gained too much influence-egoism and selfishness have won. Society needs a new moral direction. In this respect, the pair from Saarbrucken may come closer to Blair's value conservatism than Schr?der does. The modernising Hanoverian is thought to be closer to Blair than Lafontaine is, but he feels alienated by the communitarian, even authoritarian, thinking which lies behind Blairism. In the end both Lafontaine and Schr?der bear similarities to Blair, but each is unlike him in his own way. In any case, the modernisation debate is enriched by this book.
