We Can Learn From Germany- by Jerry Jasinowski
During the Civil War, critics of General Ulysses S. Grant complained to President Lincoln that the general was a drunk, a claim with some substance. Lincoln suggested that the critics should find out what Grant drank and give some of it to his other generals. "I cannot spare this man," Lincoln said. "He fights."
The current round of criticism of Germany by other members of the European Union because of its single-minded focus on exports strikes me as more of the same kind of reasoning. Germany is simply doing what everyone else does, only doing it better. Rather than criticize the Germans, we should study what they are doing, learn from them and strive to emulate them.
I have written often with admiration of Germany's highly-focused national program for channeling bright young people into manufacturing careers. In this country, hundreds of thousands of excellent manufacturing jobs are unfilled because of a scarcity of applicants with the skills needed to work in modern manufacturing. Within the past week I have seen two front page stories, one in The Washington Post and the other in The New York Times, describing how German companies in the U.S. are replicating the German experience -- putting bright young people into long-term training programs where they learn to handle modern manufacturing.
A lesser known aspect of Germany's economic potency is its aggressive international efforts to constantly seek out opportunities for exports. The German Chambers of Commerce Abroad operates 120 offices in 80 countries, and employs 1,700 people, all of them linked directly to 80 regional chambers in Germany. Funded by both the government and private industry, this far-flung apparatus runs interference for a vast sea of small and mid-sized Germany companies known collectively as the Mittelstand.
When a small German company recognizes a foreign opportunity for sales, it taps into this worldwide network and soon its representatives are being introduced to potential buyers by German envoys on the ground who speak the local language, know the customs and laws, and are well versed in what it takes to make deals in that particular country.
This gives the Germans a critical advantage. Our large corporations are very much engaged in foreign commerce, taking advantage of opportunities near and far. But the vast majority of smaller U.S. firms are not engaged in foreign markets. Much of this is due to simple complacency. Since we are the largest consumer market on the globe, domestic companies have never been pressured to sell overseas. A growing number of them are today becoming active in foreign markets, but overall our foreign footprint is small.
We would do better if we had an aggressive program to help small- and medium-sized U.S. firms exploit foreign opportunities. The U.S. Department of Commerce does operate such a program within the International Trade Administration (ITA) and it generally gets high marks, but it is a small program not on a par with the German model. If there is one area that should receive higher priority and more funding, it is surely our export programs.
Jerry Jasinowski, an economist and author, served as President of the National Association of Manufacturers for 14 years and later The Manufacturing Institute. Jerry is available for speaking engagements. December 2013