Worthwhile Changes

Nearly 2018 and Germany is still directionless

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Which way is North? Source: Fotolia

Attempts at forming a coalition have Germany’s parties oscillating between what can only be described as self-discovery and group therapy. This never-ending limbo is clearly unsettling, but is also a lesson on the struggles facing a living democracy. It emphasizes the disputes over long-term objectives and difficulty deciding which political path to take. Yet the search for a sustainable political agenda is a justifiably time-consuming process and looking elsewhere for a solution would be a fruitless endeavor.

But the Social Democrats have positioned themselves against Ms. Merkel and the Christian Democratic Union, as though they were the center of the world (and of German politics), dolling out policy mothballs and an illusion of European politics. Whereas the CDU’s objectives are overshadowed by the fanfare. Even in talks with the parties who comprised the so-called “Jamaica coalition,” there was little concrete progress. There was no regulatory orientation, no courage to address tax policy, no breakthroughs in digital policy and no respectable policy to address population growth and movements.

And now that attempts at forming an alliance have, for the time being, faltered, we are likely to see a coalition lacking inspiration and built with bad attitudes. The incessant longing for a grand narrative that glorifies 21st century governance is trite. Jean-Francois Lyotard said in 1979 that in post-modern societies, ideological narratives erode, leaving behind only a promise of personal recklessness and an improved society under the guise of a welfare state and Keynesianism.

This shines light on the existential problem plaguing social democracies: the naïve belief that expanding the welfare state leads to a perfect society. In actuality, a social benefits ratio of more than 30 percent and a nationwide minimum wage mean little. The practical concerns of citizens, worries about the impact immigration and globalization will have on their career, skills and education, go unaddressed.

The SPD responds by reshuffling funds and providing social insurance, but rather than investing in large projects, we ought to invest in areas where long-term unemployment intersects with problematic social environments. But improving the overall decline in social mobility presupposes that it is realistic for professionals, especially service sector workers, or the “service proletariat,” as Heinz Bude calls them, to climb their professional ladders. Ensuring this is politically arduous because it is often the case that action needs to be taken early on in an individual’s career, which requires employment growth and civil society engagement.

The incessant longing for a grand narrative that glorifies 21st century governance is trite.

Furthermore policy that forgets to promote social cohesion cannot act on issues resulting from global trends or rely on the openness of Germany’s society and economy.

The ultimate objective should be to look at changes in demographics and the digital transformation together. In a country with such a rapidly aging population, people who live far from major cities need prospects of accessibility, which means expanding infrastructure. For example, including high-speed internet as part of infrastructure, serving as a public good. Leaving its expansion up to the market, as suggested by the Council of Economic Experts, will not work: Aging societies are not very innovative. This is why the digital transformation must be advanced across all educational institutions and supported by investment strategies, which rely on tax incentives for research and development in addition to competitive tax rates.

And similarly, structural change must be accompanied by social and labor market policy. Regulations need to ensure flexible working hours and recognize fluctuating job and income profiles across the course of a lifetime, while ensuring basic security systems and individual insurance solutions for everyone.

Germany’s very cosmopolitan economy is dependent on the international division of labor, and this also needs to be accounted for via a free-trade strategy implemented at all levels: revitalizing the Doha Round and promoting agreements with Japan and South America. However, globalization also requires we implement a systematic and transparent immigration law, which takes into account Germany’s increasingly complicated demographics and supports internal efforts to better integrate workers into the labor market and extend the length of time individuals’ work, halting the current retirement age of 63. If self-discovery over the past few months leads to such insight, the time needed to find suitable political partners may prove to be worthwhile.

To contact the author: gastautor@handelsblatt.com

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