Can the G-20 Save the World?

Only vestiges of that reality remain in place today. The DAX has lost 35 percent of its value. The stock of energy giant E.on lost €37 billion ($50 billion) in value in the space of one year. The stock market has turned into a cemetery of the major players, while everyone, including the German government, has had to lower expectations even further. Experts in Berlin already fear that the economy could shrink by 4.5 percent this year.

The wildfire in the financial markets is engulfing the "real economy" -- as if the banking industry had always been somehow unreal -- at a dizzying rate.

In late February 2008, only 15,248 short-time workers (employees whose working time had been cut to reduce output) were predicted in Germany. By the end of February 2009, that number had already jumped to 700,038. Short-time work, laying off temporary workers, hiring freezes, temporary production shutdowns -- these are the methods with which German companies attempt to delay painful job cuts.

But the first wave of layoffs has already hit Germany, with Düsseldorf-based Rheinmetall AG announcing plans to eliminate 1,000 jobs. Steel giant ThyssenKrupp expects to cut 3,000 positions, tire maker Continental wants to lay off 1,900 workers and ailing lender HSH Nordbank is letting go 1,575 of its 4,300 employees. More cuts are on the way across the board as unemployment rises. Nevertheless, they are far less dramatic in Germany than elsewhere.

According to official estimates in China, for example, 20 million migrant workers have lost their already low-paying factory jobs. In the United States, 4.4 million people have been sent home since the beginning of the recession, half of them in the last four months alone.

Left to Their Own Devices

In a globalized market economy, the patterns shaped by old political distinctions are no longer as relevant as they once were. Of all things, the communist People's Republic of China treats its workers as coarsely as the unbridled Manchester capitalists once did. Factories are shut down overnight and their entire workforces are left to their own devices -- and anger.

Conversely, the capitalist West is placing its bets on the powerful state. The US government is taking over ailing banks and insurance companies, while the government in Berlin has introduced legislation that would make nationalization of enterprises possible.

Partly because the financial intricacies of the disaster are so complex, moral debates turn into the theaters of proxy wars. At least everyone can participate and join in the general finger-pointing when the conversation turns to ethics and decency.

Attacks on top executives are on the rise, especially in Great Britain and the United States. The former golden boys have become the targets of verbal abuse, and some have even received death threats. In France, angry employees took their supervisors hostage twice in the space of a few days. And in the United States, bus trips have even been organized to the homes of AIG executives -- the insurance company that probably dug the biggest and most expensive hole of all.

And there was German President Horst Köhler -- the sometimes wooden former managing director of the IMF and chairman of the association of savings banks in Germany -- who, surrounded by the austere red-brick walls of Berlin's Saint Elisabeth Church, gave what was probably his best speech since he became German president.

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