The New German Problem

As Germany prepares to elect its next Chancellor, the two main candidates, Gerhard Schroeder and Edmund Stoiber, agree on one thing: unemployment must be reduced. Over the past two decades, high unemployment has transformed Europe in general and Germany in particular into a sociological time bomb. What will the unemployed - especially the long-term unemployed with only dim memories of integration into the world of work - do with themselves and their time? What will happen to confidence in governments that can not solve the problem?

It is easy to forget that little more than 50 years ago, Europe was the world's most violent continent. Europeans spent the previous forty years slaughtering each other on a scale unprecedented in human history. Against this backdrop, Western Europe after 1950 was remarkably peaceful and stable, even taking into account the fall of the French Fourth Republic and the transitions from dictatorship to democracy in Portugal, Spain, and Greece.

The most remarkable transformation of all was that of the Federal Republic of Germany. Anyone familiar with German history since 1800 is still astonished at the enthusiasm with which the nation that emerged from total defeat in 1945 embraced what many in previous generations would have called "unsuitable" Anglo-French political and economic models. Without the peace and stability that this assured in Germany - the largest linguistic nation west of Russia - it is difficult to imagine today's peace and stability in Europe as a whole.

Germany owes its transformation in part to a combination of three factors: a backlog of unexploited technological opportunities to fuel rapid income growth, nearly full employment, and a state that shared the benefits of growth widely through public programs (rather than serving one class or interest as a weapon to concentrate wealth and power). Other factors - the memory of the Nazi catastrophe, the example of life east of the Iron Curtain, the potential threat posed by Stalin and his heirs - also clearly played an important role. But the fact that the system worked for almost everyone was the final buttress holding up the cathedral.