Christian Vogel, pale and tired, climbed the stairs to his fourth-floor flat in Offenbach, an industrial suburb of Frankfurt. Silently he tossed a blue envelope on the table. His seven-year-old daughter looked puzzled. "Was ist los, Mutti?" she asked. Said her mother: "Dein Vater ist entlassen" (Your father is fired).
In Western Germany, the blue dismissal envelopes are going out to workers in factories and shops at the rate of 15,000 a day. Five hundred thousand Germans have been added to the unemployment rolls in the past two months; more than one worker in ten is now jobless. Only a fraction of...