A recent article by the Economist (Why Germany Has No Gilet Jaunes Protesters) argued that the reason why Germany is less economically depressed and politically radicalized (does not have the kind of decaying/depopulating region and extreme ideological friction we see in France or the USA) is because it managed to achieve more equitable economic development among its regions… by better redistributing the wealth of federal government to its states (Lander).  Through a ‘constitutionally mandated’ system of fiscal transfers across states, the German government has been able to ‘smooth globalization rougher edges.’

In the US federal system of government, the federal government raises revenues through taxes, and spends them accordingly to national needs.  Prior to the Great Depression, Federal Government revenues and spending was limited, but FDR introduced massive government spending to jump-start the economy, etc, etc.  Since the 1930’s, the Federal Government has been legislating/regulating and interfering with local economy issues through its various government spending programs and grants.  Republicans have tried to institute block-grants and ‘money transfers’ where the Federal government just gives chunks of money with no string attached so States can spend them as they see fit, but Democrats have resisted.

So, in the US, the Federal government has large revenues that it uses to influence national policy. The result is for example a national policy to subsidize the oil and gas industry (or corn production) because it is good for the whole country… as opposed to sharing government revenues with the States, and seeing that Texas might still use that money to promote oil production, while NY might use that money to subsidize Kodak, and preserve local manufacturing jobs.  Again, from a national point of view, cheap imports might be better then manufacturing jobs… but locally, what is true in big cities, is not true in the rust-belt. 

The point of the article is that because the German system has been more devolved and deferential to empowering local governments to pursue policies that helped their local companies, they have seen strong manufacturing sector, and jobs (not just in the big cities, but also in small rural towns)… and as a result, no populism/nativism of the kind we have seen in France and in the US.   Centralization of power leads to marginalization in local/rural areas, which under economic hardship leads to polarization and radicalization! Hope this makes more sense…

Therefore, in support of devolution of power at a federal system, Germany represents a very useful comparative case for the US.  Constitutional requirements for mandatory transfers of money from the federal government to the states (Lander), have led to more uniform and balanced economic growth, a globally competitive manufacturing sector (even/especially at the small company level), and a much more subdued radical populist response to globalization.