In the next few weeks, the German government will argue not only about taxes but also about the nuclear power issue.
Suvi Turtiainen,
Alina Mäkynen
In Germany, a new trend word has appeared in the economic discourse: Deindustrialisierung. The word is only translated awkwardly, but in practice it means a decrease in industry.
The word buzzes in news headlines, financial reports and increasingly also as part of conversations. The fear is real in Europe’s leading industrial country. Will we have to close factories in Germany because of the energy crisis?
It already seems clear that the Russian invasion and the resulting energy crisis are leading Germany towards recession. This is also the opinion of Germany’s so-called economic sages, i.e. five leading economic experts who published by (you move to another service) on Wednesday, an overview of the development of the German economy for this year and next year.
This year economic growth is forecast to be 1.7 percent. Next year, Germany’s gross domestic product will shrink by an estimated 0.2 percent. The forecast promises difficult times – and the political solutions proposed by the economic sages a new government crisis.
According to economic experts, Germany should finance the already decided 200 billion euro energy support package by raising taxes on the rich. The gigantic subsidy package has been criticized in Germany as a watering can, because it spills subsidies a little everywhere. (In Europe, it is criticized as unfair towards other EU countries.)
In the opinion of financial experts, the targeting of support could be balanced by taxing high-income earners. One proposed method of taxation is a solidarity payment for the highest earners.
Chancellor By Olaf Scholz the proposal is very pleasant for the social democrats. The government partner, the liberal party FDP, opposes all tax increases instead. The finance minister representing the party Christian Lindner already had time to reject the proposal of the economic sages.
For the third poison for the governing party, i.e. the German Greens, is a completely different proposal by economic sages. Viisikko is in favor of extending the service life of Germany’s nuclear power plants.
In the current compromise of the German government, the last three nuclear power plants will not be closed according to the original plan at the turn of the year, but in mid-April.
The Greens are against extending the operating time of nuclear power plants. According to economic experts, it would make sense to stabilize the electricity market. Ylen’s Uutispodcast predicted that Germany’s nuclear power debate has not seen the last installment yet. That seems to have happened.
In the next few weeks, the German government will argue not only about taxes but also about the nuclear power issue.
Tschüß!
Summer
PS Read below my colleagues Alina Mäkynen excerpts from European topics throughout the week and what is coming in the near future. ⬇️
COMING NEXT WEEK:
ON MONDAY EU foreign ministers meet (you switch to another service) To Brussels to discuss the Russian war of aggression, the African Great Lakes region and the Western Balkans. They will continue meeting on Tuesday ministers of defense (you move to another service)which wore down the continent’s defense capabilities.
EUROPEAN MINISTERS meet (you switch to another service) on Friday. The agenda includes the preparation of the European Council in December, EU-UK relations, and the hearing related to the development of the rule of law in Hungary.
NEXT WEEK is also interesting to follow in Britain, where the finance minister Jeremy Hunt’s is supposed to present the British government’s new economic plan on Thursday. We hope for stability from the plan, but some of what has been leaked to the public means (you switch to another service) has raised concerns among business representatives.
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