Economic conundrum

We often hear that high labor costs and excessive regulation have hurt the United States’ ability to compete globally in manufacturing.  Yet one of the goals of the recently concluded G-20 summit was to persuade Germany, no less than China, to whack back its export-driven economy in favor of greater consumerism.   So how does Germany, with its mandatory Mitbestimmung (worker participation in management decisions), strong unions, and extensive welfare protections,  keep its export sector competitive.  Perhaps by concentrating on high-end engineered products.  But so could the U.S., presumably.  I find this a puzzle.

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