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Bill George

Harvard Business School Professor, former Medtronic CEO

A Postcard From Berlin

Returning to Berlin for the first time in several years, it is remarkable to see this great city progress as the cultural center of Germany. Penny and I had the privilege of staying at the magnificent Adlon Hotel as our hotel room looked out on Brandenburg Gate, the former dividing line between East and West Berlin. I still have vivid memories of standing under the gate on October 3, 1990 – the day of German reunification – when Maestro Leonard Bernstein conducted the Berlin Philharmonic playing Beethoven’s 9th Symphony with its glorious “Ode to Joy.”

Some thoughts on our impressions of Berlin circa 2014:

  • I wish I could have been here on Sunday, July 13 for the spectacular triumph of the German soccer team as 250,000 Germans watching on large screens on Unter Den Linden saw young Mario Götze’s brilliant goal in the 113th minute to bring the World Cup back to Germany.
  • Two days later 400,000 Germans gathered to greet their heroes as the team arrived home from Rio. Prior to landing at Berlin’s Tegel airport, their airplane did a flyover and wiggled its wings to salute the cheering masses. What a contrast with the 1930s …
  • Speaking of the 1930s, German contrition and ownership of the terrors of the past are present everywhere, but no more apparent than at the stunning and horrifying Topography of Terror. This museum documents the shame of the past without pulling any punches. Just one block from Brandenburg Gate is the haunting Holocaust Memorial, with its images of large blocks protruding from the grounds (representing those who died in the Holocaust?). As horrifying as these monuments are, one has to credit the German people for owning the sins of their past. Where in the U.S. can one find an owning of our past of destroying Native American cultures (or attempting to do so) or bringing slaves to our shores in chains? Or in Russia of the 25 million people “eliminated” by Joseph Stalin?
  • These monuments constitute but a small fraction of the architectural wonders of Berlin, as many of the world’s greatest architects have come here with the freedom to showcase their greatest creations – not the least of which is amazing Sony center. Berlin today is a modern, beautiful city that all Germans can be proud to call their capitol.
  • I have long admired the German economic miracle which has occurred since the rapprochement in the past decade, thanks to the leadership of former Chancellor Gerhard Schröder. He brought together business, labor and government leaders to act in concert to build the German economy. The result of their efforts has been years of improved competitiveness, thanks to highly skilled workers, flat wages and benefits, low inflation, and net exports exceeding $200 billion – a sharp contrast to the U.S.
  • Now there are cracks appearing in the vaunted German resolve, as wages are rising again at 3-4%, well above Germany’s low inflation rate of 1%, and German industry finds itself far too dependent on Russian gas that costs three times the price paid by its U.S. counterparts. Meanwhile, a rift is emerging between complacent German politicians and German industrial CEOs forced to expand outside Germany in order to remain competitive. How will Germany resolve these differences? We left Berlin without any clear answers to this question, in spite of asking many leaders to respond to it. One hopes that Germany will continue to be  not only the leader of Europe, but a role model for all industrial nations, including the U.S.
  • Meanwhile, one of the weaknesses of the German economy – the lack of entrepreneurship and risk-taking – does not appear to be any closer to resolution than it was a decade ago. Time and again, we were told of the fear of failure that so many German leaders have and their unwillingness to embrace the kind of innovation so commonly seen in Silicon Valley due to the personal risks involved.

While Germany has its share of challenges, they pale by comparison with the political gridlock we face in the U.S. I have the clear sense that the diligence, commitment, and pragmatism of Germany’s business, government and labor leaders, and the strong sense of unity among them, will enable Germany to resolve the issues it faces, and continue to be a strong, competitive player on the world scene – and a role model for all developed economies.