What Germany needs is an Energiewende
Among the dismal economies of the old Soviet East Bloc the German “Democratic” Republic stood out for its high productivity enough to give rise to the quip that “The system has not been invented under which the German people cannot work”
But apparently even those subjected to Communism could not foresee modern climate policy.
Germany, whose early enthusiastic embrace of the so-called energy transition or in German “Energiewende” (see “Why Germans don’t play Scrabble”) has on balance proven to be a disaster.
As the New York Sun just put it, “Germany Emerging as the Sick Man of Europe, With Growth Projected at a Tenth of a Percentage Point This Year”. It can’t have been easy.
And it’s not something to emulate. Instead maybe, just maybe, the former engine of European prosperity needs a dramatic turn in energy policy away from Einhörner and back to stuff that works.
Those not well-versed in German history may be surprised to learn that among its marked characteristics is early, widespread and persistent environmentalism.
Which is in itself a good thing, though it’s troublingly linked to a Romanticist, modernist stream in their culture that contributed to the terrible damage it did to Europe and the world in the first half of the 20th century.
The apparently intractable problem of what to do about Germany seemed to have resolved itself with dramatic suddenness in the late 1940s and 1950s as the country, at least on the West German side, embraced democracy, conventional virtues and the pursuit of prosperity.
Now it is the sick man of Europe. Those who are well-versed in history will recall that phrase was long applied to the Ottoman Empire, which posed a major problem in 19th-century European diplomacy because if it died, the corpse was liable to disintegrate in ways that triggered war, but nobody knew how to keep it alive. (In fact it staggered along somehow until World War I, in which its sultan proclaimed the last-ever jihad declared by a caliph, on behalf of… Germany.)
But just how bad is Germany’s trouble?
It’s bad. In fact, the Sun writes:
“America leads the OECD’s projection of member country economies, with 2.6 percent growth anticipated for 2024, while the Euro area as a whole is likely to enjoy a more modest 0.7 percent.”
More modest is one way of describing it. Utterly dismal and catastrophic also springs to mind. Especially because of the superficially encouraging follow-up that:
“Real GDP projected growth rates for the world as a whole are 3.2 percent for both 2024 and 2025, thanks in part to improving consumer confidence worldwide.”
Why’s that one bad? Because the West, apart from the United States whose embrace of green follies is less complete and fanatical than that of Europe, is falling dangerously behind malevolent competitors.
As the piece further notes:
“Even the Russian economy, despite being under one of the world’s most constrictive international sanction regimes following the full-scale invasion of Ukraine in 2022, is projected to grow by 3.7 percent this year.”
Of course Russian official statistics are roughly as credible as Chinese Communist ones. And when both Russia and Germany have been strong it wasn’t always a good thing for the rest of the continent.
But having Germany be strong today is a problem one might prefer to the actual situation where:
“In the Teutonic capital at Berlin, though, eyes are on the OECD’s much more modest projections for their own country.
The OECD’s mandarins say Germany will grow a piddling 0.1 percent this year, and a modest 1 percent for 2025, a startling prediction for the world’s no. 4 economy and the largest in Europe.”
That such a nation can still have the world’s 4th-largest economy, behind the U.S. China and Japan, and narrowly ahead of India, the UK, France, Russia, Canada and then (no, really) Italy can be explained only by the fact that economic policy in most of the world is indescribably wretched and foolish.
But actions have consequences, and actions stem from ideas, and the parlous state of the German economy, and that of Britain as well, can be traced with considerable certainty to their believing fairy tales about energy.
You can make a bunch of excuses, and claim that the first Energiewende is about to pay off big time.
But at some point the flight of manufacturing, the collapse of growth, the increasing immiseration of the people and the geopolitical fragility all tell you that actually getting rid of energy that works for unproven systems that are failing the test is a very bad idea.
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Richard
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In 2009 , Russia pivoted to Asia as it saw Europe as sclerotic . That pivot was not smooth sailing but as China has opened up new trade routes have followed .
This year 130 countries have visited Russia to discuss business and joining BRICS . 85 countries have asked to join and 158 countries are moving to de- dollarize .
Vs the US debt is increasing a trillion dollars every hundred days .
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