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The stability of their own economy is guaranteed by the Eurozone. Because of the Euro, Germany can run a massive trade imbalance to export their goods. You nuke

by toyg 4y ago

The stability of their own economy is guaranteed by the Eurozone. Because of the Euro, Germany can run a massive trade imbalance to export their goods. You nuke the Eurozone, and suddenly German goods become massively more expensive for hundreds of millions of people, which will tank their income. The German people are better off subsidizing other Europeans to buy their cars, like Ford did with their workers.

xyzzyz 4y ago
> You nuke the Eurozone, and suddenly German goods become massively more expensive for hundreds of millions of people, which will tank their income. Yeah, but the imports then also become massively cheaper, so it might even out: Germany will just start importing more stuff e.g. from Poland instead of producing it locally.
- rcMgD2BwE72F 4y ago
  >Germany will just start importing more stuff e.g. from Poland instead of producing it locally And this way, they lose their main advantage: a strong economy that focuses on export. They can't have their cake and eat it too. Especially when their auto industry is set to lose greatly with the EV transition (which they still try to slow down).
  - xyzzyz 4y ago
    No, they would export some stuff and import other stuff. It would all balance out. In the end, it must: what’s the point of exporting things, if you don’t get other things in return? Exporting is not a charity, you must import things in order for exports to make sense.
    - toyg 4y ago
      > what’s the point of exporting things, if you don’t get other things in return? This take is utterly naive. What you "get in return" from being a massive exporter is not all quantifiable. It's soft power, influence, prestige. When everyone uses your machinery, you control the standards and their evolution, you control the market. Plus, even going back to purely economic terms, you can absolutely export and then keep the accumulated money sitting in coffers, financializing the gains (lower borrowing costs etc etc), or invest in local research to extend your advantage, and so on and so forth. None of these options require importing anything.
- toyg 4y ago
  "Evening out" would weaken and impoverish Germany, compared to its position now. I mean, we can do it, but I guess that's not what the German public really wants.
valenterry 4y ago
In the past, that was true. But German's current trade balance is actually negative. It's importing more than it's exporting. That might change again of course, but as of now there is no "massive trade imbalance" anymore.
- _ph_ 4y ago
  Well, right. Not because we are exporting so much less, but pay hugely more for the things we are importing, due to the ballooning gas prices.
wsc981 4y ago
> The German people are better off subsidizing other Europeans to buy their cars, like Ford did with their workers. To me this sounds a bit like the broken window fallacy [0]. That it’s good if sometimes a window gets broken, because it generates economic activity. But this ignores the fact that economic value was destroyed in the process. Those subsidies could be used in other ways as well, perhaps by helping startups grow. —— [0]: https://en.m.wikipedia.org/wiki/Parable_of_the_broken_window https://en.m.wikipedia.org/wiki/Parable_of_the_broken_window
- danans 4y ago
  > But this ignores the fact that economic value was destroyed in the process. Value gets destroyed in the process of using anything, so much that we have a special word for it: depreciation. Cars and other machines will wear out after enough use. Even more static goods like windows (usually the seals) fail with time and need to be replaced.

by toyg 4y ago

xyzzyz 4y ago

> You nuke the Eurozone, and suddenly German goods become massively more expensive for hundreds of millions of people, which will tank their income. Yeah, but the imports then also become massively cheaper, so it might even out: Germany will just start importing more stuff e.g. from Poland instead of producing it locally.

rcMgD2BwE72F 4y ago
>Germany will just start importing more stuff e.g. from Poland instead of producing it locally And this way, they lose their main advantage: a strong economy that focuses on export. They can't have their cake and eat it too. Especially when their auto industry is set to lose greatly with the EV transition (which they still try to slow down).
- xyzzyz 4y ago
  No, they would export some stuff and import other stuff. It would all balance out. In the end, it must: what’s the point of exporting things, if you don’t get other things in return? Exporting is not a charity, you must import things in order for exports to make sense.
  - toyg 4y ago
    > what’s the point of exporting things, if you don’t get other things in return? This take is utterly naive. What you "get in return" from being a massive exporter is not all quantifiable. It's soft power, influence, prestige. When everyone uses your machinery, you control the standards and their evolution, you control the market. Plus, even going back to purely economic terms, you can absolutely export and then keep the accumulated money sitting in coffers, financializing the gains (lower borrowing costs etc etc), or invest in local research to extend your advantage, and so on and so forth. None of these options require importing anything.
toyg 4y ago
"Evening out" would weaken and impoverish Germany, compared to its position now. I mean, we can do it, but I guess that's not what the German public really wants.

valenterry 4y ago

In the past, that was true. But German's current trade balance is actually negative. It's importing more than it's exporting. That might change again of course, but as of now there is no "massive trade imbalance" anymore.

_ph_ 4y ago
Well, right. Not because we are exporting so much less, but pay hugely more for the things we are importing, due to the ballooning gas prices.

wsc981 4y ago

> The German people are better off subsidizing other Europeans to buy their cars, like Ford did with their workers. To me this sounds a bit like the broken window fallacy [0]. That it’s good if sometimes a window gets broken, because it generates economic activity. But this ignores the fact that economic value was destroyed in the process. Those subsidies could be used in other ways as well, perhaps by helping startups grow. —— [0]: https://en.m.wikipedia.org/wiki/Parable_of_the_broken_window https://en.m.wikipedia.org/wiki/Parable_of_the_broken_window

danans 4y ago
> But this ignores the fact that economic value was destroyed in the process. Value gets destroyed in the process of using anything, so much that we have a special word for it: depreciation. Cars and other machines will wear out after enough use. Even more static goods like windows (usually the seals) fail with time and need to be replaced.