Rich German, Poor German: Germany's Middle Class Is Shrinking. 11/20/2008

http://www.spiegel.de/international/germany/0,1518,591615,00.html

A new report adds more evidence to the fear of a widening income gap in Germany. The solid German middle class is losing people to the top and bottom of the income scale, while satisfaction with the German system falters.

The divide between rich and poor is widening in Germany, according to a new annual report, and dissatisfaction with the German welfare state has grown. The Social Science Research Center in Berlin released its 25th annual report on Wednesday and said German enthusiasm for recent social reform is low -- at least among poorer Germans, whose ranks have swollen over the past few years.

Protesters organized a masked ball at the G-20 summit in Washington DC last week. The gulf between rich and poor has widened on both sides of the Atlantic.
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DPA

Protesters organized a masked ball at the G-20 summit in Washington DC last week. The gulf between rich and poor has widened on both sides of the Atlantic.
One feature of stability in the German Federal Republic after World War II was always the nation's broad middle class. After the "economic miracle" of the 1960s, West Germans as a whole were neither too rich nor too poor nor too dissatisfied with their new democracy.

Those sentiments are changing, according to the annual "Datenreport 2008" relased Wednesday by the Social Science Research Center.

Real income between 2001 and 2006 has stagnated, rising from €1,392 per household per month only to €1,413. And by 2006 the poorest 20 percent of the population received 9.3 percent of the total monthly income among German private citizens -- down from 10.1 percent in 1997. Meanwhile the share of the richest 20 percent has increased by one-fifth over the same period.

The numbers confirm a trend toward a smaller middle class recognized by other institutes, including the Organization for Economic Cooperation and Development and the German Institute for Economic Research. "While the portions of the population at the top and bottom of the income scale have increased over the past few years," reads the "Datenreport 2008," the corresponding portions of the middle class have shrunk."

Meanwhile more Germans are grumbling about their welfare system. On a scale of one to 10, those in former West Germany put their satisfaction with the government's social services at an average of 5.5. That was slightly higher than the score in eastern German states -- a solid, middling 5.0.

Germans were even less impressed by their politicians. Western Germans surveyed in 2005 gave their political system a one-to-10 grade of 5.2, compared to 3.9 in the east. The report called these marks an "alarmingly low level of satisfaction with democracy in Germany."