Don’t Mention the Nuclear Power

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    It looks like Germany is having a tough time… again. It’s not the first time the Economist asks whether Germany is ‘the sick man of Europe’, as it did on its August 19th cover. Apparently, the magazine used the same title at the beginning of the noughties, Mirco Reimer-Elster, Denmark’s TV2 analyst and author, reminds us at this week’s Global Fund Search Investment & Networking Symposium, in Copenhagen. But what is different this time? Reimer-Elster asks the event’s keynote speaker, former SPD chancellor candidate and Finance Minister, Peer Steinbrück.

    In a 45-minute live interview on stage in one of the beautiful dining rooms of the Hotel d’Angleterre, Steinbrück admirably takes on Reimer-Elster and calmly answers his increasingly provocative questions. It is said that Germany has outsourced its defence to the US, its energy sources to Russia and its production to China. Is this an appropriate explanation for the country’s woes today? The assessment isn’t far off, according to Steinbrück. But does he think, like current chancellor Olaf Scholz claimed in his 2022 speech, that Germany has reached a ‘Zeitenwende’, a historical turning point?

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    Steinbrück is reluctant to criticise his own country’s leadership, especially since he belongs to the SPD, the same party as the current government. Under the fire of Reimer-Elster’s inquisition, however, it transpires that he disagrees with the notion that Germany has turned the corner and, while he claims that the country is like a tanker, slow in its turn but strong once on the right trajectory, doubt transpires about whether the movement has really started. As Reimer-Elster quotes him, he might believe more in a ‘Zeitenbruch’, a historical rupture, as coined by former foreign minister Joschka Fisher.

    The problem, Steinbrück claims, is that the reforms needed to turn around the country require tough decisions and a strong hand to implement them, which may prove unpopular. A similar operation performed by Gerhard Schröder in the first few years of the new millennium cost him his re-election. Unfortunately, doing nothing or failing to drive change might also cost Scholtz his spot at the top of the government in 2025.

    It doesn’t help that Germans are ‘Veränderungsangsthasen’, best translated as change-scaredy-cats. In other words, most people are comfortable in a ‘permanent present’, explains Steinbrück elegantly. Perhaps that is one reason the country is lagging when it comes to innovation and digitalisation. Indeed, the heavy industry where Germany used to excel, including car manufacturing, is being replaced by innovation from the US, China and any other country where entrepreneurship is better supported. A heavy and outdated administration system seems to be another root cause. Not all is lost however, the once chancellor candidate ascertains: once Germany is on the right trajectory, it will once again charge ahead and serve as the leader of Europe’s economy.

    Steinbrück has patiently taken all the curve balls thrown at him until the time for the audience’s Q&A arrives. “Did Germany make a mistake turning off nuclear power?” a brave voice asks. “Yes,” is the simple and surprisingly straightforward answer Steibrück gives. But then, reminding Germany of its mistake isn’t really helping, is it? Apparently, this decision is now part of history, and that means it shouldn’t be re-examined.

    You can question the hegemony of German cars, you can accuse the government of not living up to its NATO commitment with too slow an increase in military spending, you can be worried about BASF’s (and other leading industrial giants’) increasing reliance on Chinese manufacturing, you can even critique the leadership of the current government. Just one thing: don’t mention the… nuclear power.

    Image courtesy of DAVID KAHR for Global Fund Search
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