2023-08-30 19:45:59
Cabinet retreat at Meseberg Castle
Just a few weeks ago, the traffic light coalition gave the impression that it had not understood the seriousness of the economic situation.
(Photo: IMAGO/Manngold)
The Federal Minister of Finance is certainly one of the more rhetorically gifted ministers in the cabinet. Sometimes, however, Christian Lindner (FDP) tends to imaginative interpretations that he should have too exclusively: “We are a government where hammering and screwing is done.” That leads to noise, but also to results, Lindner glorified after the government meeting in Meseberg the coalition crash of the traffic light government, which could not be ignored in the furthest corners of the republic.
Chancellor Olaf Scholz (SPD), who praised the government’s productivity during the summer break, practiced a similar whitewashing.
It is correct: As far as the output is concerned, the cabinet meeting went better than one had to fear after the bickering about the Growth Opportunities Act and the basic child security. Scholz, Lindner and Economics Minister Robert Habeck (Greens) were able to announce a series of legislative decisions and initiatives that the economy has been waiting for for a long time, from reducing bureaucracy to digitization strategies and tax relief for companies.
The fact that the government is now attracting attention with a whole bundle of sensible legislative decisions instead of fighting is a big step for the traffic light coalition. It’s not enough for the country, which is suffering from serious economic weakness.
This applies to the plans to reduce bureaucracy. Travelers and hoteliers may be happy that they no longer have to fill out or keep registration forms. The shortening of retention periods for accounting documents is also good.
>> Read more: This is how experts assess the new law on reducing bureaucracy
But as useful as all the small measures are, further steps remain urgent. Entrepreneurs who complain about bureaucratic hurdles when investing in Germany do not first think of hotel receipts. Especially since the bureaucratic burdens for companies are saddled up elsewhere at the same time.
Good but not enough
Good, but not sufficient – this also applies to the Growth Opportunities Act. The premium for investments in climate protection makes sense, and business representatives have long been calling for better offsetting options for losses. It’s good that both are coming. Such investment incentives can help in the current situation. However, they do little to change the fundamental problem that Germany has an increasing competitive disadvantage with comparatively high corporate taxes. To remedy this, a fundamental tax reform would be necessary.
>> Read more: Traffic light relieves economy by seven billion euros
The other resolutions on digitization and AI applications tend to fall into the overdue category. Especially since in these areas there is the tolerable experience that a legal requirement is one thing, but the practical implementation in authorities or the health system is much more complicated and lengthy.
After all, the fact that Chancellor Scholz and his cabinet colleagues put economic policy at the center of both the laws and their appearances in Meseberg is a hopeful signal.
Just a few weeks ago, the traffic light coalition gave the impression that it had not understood the seriousness of the economic situation. Think of Family Minister Lisa Paus (Greens), who blocked the relief for companies in order to get more out of basic child security. That went terribly wrong, which is probably due not least to the chancellor, who did not want to reward Pau’s extortion maneuvers.
>> Read here: Traffic light coalition announces a restart of government work in Meseberg
The open question now is whether this will resonate in the coalition. The problem over the past few months was not that there was noise when hammering and screwing, but that the coalition partners gave the impression that they were building very different things. While the Greens want to react to the economic weakness primarily with government spending and subsidies, the Liberals are focusing on structural improvements on the supply side and government austerity measures.
After the small step by Meseberg, direction decisions are still waiting for the traffic light coalition. The quicker these are clarified, the better – even if it is not always quiet.
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