On Germany's low salaries
They are lower than 17 years ago. So what becomes expensive when you can have it all on the cheap? Children might be the answer.
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Now, on to serious stuff. Today I wanna talk about Germany’s low salaries, authentic human connections that we all crave and need, and the experience of having children. Let’s dive in -
Germany’s Malaise
Read this. It’s shocking:
German Salaries are still lower than they were in 2003 (in nominal terms. If you account for inflation, they are MUCH MUCH lower).
I posit Germany hasn’t yet digested the annexation of the ex-DDR. It’s consequences are still felt every day in Germany and in Europe.
The German Unification was not such. Rather, it was an annexation, a hostile takeover. A consequence was millions of East Germans with freedom to move West but with no modern-world experience or skills to be productive in a market economy.
That means, millions of people were unemployable at (West) German wages.
The solution was to cheapen labor costs. The social democrat (i.e. left-wing) government created the “Minijobs”. Basically, companies could hire people to work up to 4 hours a day and make max 450€/ month. That was basically tax free. Companies didn’t need to pay Social Security. The government subsidized healthcare and retirement.
A consequence was low-wage, low-skill job creation. Why hire 1 employee that will cost you 2000€ when you can hire 2 part-timers for 900€?
West German housewives and East German couriers were the main beneficiaries.
Lower wages creates a society obsessed with saving and cost-cutting. That’s why Germany will not invest in improving its very deficient infrastructures. And that’s why Germany tortured the so-called PIGS during the Financial Crisis.
“Germany’s Economy Runs on Low Wages”, Leonid Bershidsky, Bloomberg, 09/04/2019
“The low-wage sector in Germany is larger than previously assumed”, DIW Weekly Report, 03/04/2019
Abundance Makes Human Connection Is Scarce
What happens when we can get everything we need via technology?
What happens when our apps, algorithms, AI-powered devices help us buy things, receive things, go places without need for human intervention?
What happens is that costs will drop. I the end, eliminating the human factor, makes transportation, supply chains, entertainment, information, etc cheaper or free.
But other tings become much more expensive.
Have you considered why are there so many nail salons, barbershops or knitting places? Why reading clubs and literary workshops are sprouting up in every neighborhood library? Why there are so many couches, therapists, advisers and instructors of all kinds?
In a world where material needs are becoming human-less, our humanness still craves connection. So being able to express ourselves and to have a friendly chat becomes:
Deliberate
A scarce resource. Therefore, more expensive.
I have my favorite bookstore. I love buying books there. I could buy them online much cheaper. But I love to go there. Because I can talk to their staff, I feel understood, and I feel they understand their trade.
So in our Post-Scarcity future what makes the difference between free (or ultra cheap) and expensive is the amount of human interaction you wanna pay for.
And human connection just becomes another (premium) service.
“The Other Environmental Crisis”, Raptitude, 01/2020
About Having Children
I read this piece called “Having Kids”. I identify with the author. Having children is the worst and at the same time the best thing that’s ever happened to me.
The “worst” part is easy:
Sleepless nights
Permanently tired, energy-depleted
I am poorer than I would be if I had no kids
Couple’s life becomes more of a business partnership than a romantic relationship for some time
I don’t belong to me anymore, some little beings successfully claim ownership over me
But as the author says:
“I remember perfectly well what life was like before. Well enough to miss some things a lot, like the ability to take off for some other country at a moment's notice. That was so great. Why did I never do that?
See what I did there? The fact is, most of the freedom I had before kids, I never used. I paid for it in loneliness, but I never used it.”
Amen to that.
Because for me the good parts are so so ENORMOUS:
I am much more productive (I disagree with the author here). I work less, much less, but produce more
I feel the highest form of Love there is
I receive pure, unconditional Love
I serve a greater good, a greater purpose. Life doesn’t feel empty
The connection with my children is so huge, and so real. I cannot feel alone.
Children are fun!
They are my best friends
Family life becomes richer and stronger, including with your spouse
I am less ambitious. Which is good, most ambition is vacuous.
I am more mature
It helped me see people’s motivations better. We adults are just as selfish and plainly manipulative as little kids. Just more sophisticated. I am better at sales, at running my company and at being a boss. It teaches you leadership skills, if you wanna put in CV-lingo
Anyway, read it:
“Having Kids”, Paul Graham, 12/2019
Whether with or without children: Do you agree?
Well, that’s it for now. Feel free to comment, reply and share.
Your friend,
Òscar