So, is it working?
Germany has changed its tactics. Beggar thy neighbor to solve domestic economic issues is dead. Long live beggar thy neighbor to solve demographic problems. Merkel herself stated on the issue of labor mobility within the EU(my translation):
We have to be open for young people who come to us, since we already know today that we will have six million less workers by 2025.
Hell yeah. While most foreign immigrants still move to Germany from Poland (92,900), Romania (66,900), and Bulgaria (29,200), we now see Italy (26,500) in fourth and Spain (15,500) in sixth place. The increase compared to the first six months of 2012 was a massive 40.6 percent and 39.1 percent respectively.
Only, the number of foreigners coming from Russia increased by more than that (126.9 percent or 15,800 persons). 7,300 people who aren't German citizens moved from Portugal to Germany, and the increase was 25.9 percent or the fourth highest. Only, Greece is a bit different, here the number declined to 15,100 (-4.5 percent).
Now, many might not think that this is a problem, since labor mobility was one of the goals that the EU tried to achieve, but it actually is, because there is no federal safety net, meaning that those that find work in Germany pay German social security contributions, which means the only upside for Spain is that the unemployment number falls, but at the same time this significantly worsens the overall outlook because the elderly remain in the country and the young leave to find work elsewhere.
Spain is very much becoming a Giana Sisteresque (video) nightmare version of Florida, with a predominantly elderly but very poor population. What we need to make the euro zone work is a federal budget to reduce the local impact of asymmetric shocks by creating a federal safety net. [..] Currently, this union does one job and one job only. It strengthens Germany at the expense of all other countries.But there is also a problem for the new immigrants themselves. Not knowing the language means that their chances of finding a job which pays at the level of their training are low. So, with the current "system" we are seeing massive downsides for the country, for the workers, and the only Germany profits. This seems to resemble an old German vision quite closely: a strong Germany in the middle of Europe getting cheap lower class labor for its industry, while at the same time Germans get cheap vacation space in the South. Oh and we
Urrrlaubsrrraum im Süden