Germany’s coalition government has agreed a sweeping package of welfare cuts worth €38.3 billion by 2030, stripping back the country’s health system and pension guarantees to free up funds for military spending…
The most contentious measure removes free health insurance coverage for non-contributing spouses. Under the new rules, spouses who do not pay into the statutory system will be required to contribute a minimum of 2.5% of their partner’s insured income…
Co-payments for medicines and hospital stays will also rise. Changes to the funding rules are expected to place additional strain on the statutory health funds, known as the Krankenkassen. In total, the austerity package is projected to save public health insurance funds €19.3 billion next year, rising to €38.3 billion by 2030, with reductions focused on spending at clinics, GP surgeries and on pharmaceutical costs.
The health cuts are not the only blow to German social security. Merz has stated that the state pension will be reformed into what he described as “basic cover” for old age and will no longer be sufficient to maintain living standards over time.
A major factor in Germany is high energy costs. They hoped to rely on cheap natural gas from Russia while they built green energy capacity. Loss of Russian gas means they must buy much more expensive LNG. And now high oil prices.
This is causing major changes in the manufacturing economy. Major chemical plants are for sale as they can no longer compete in world markets. Or cheap imports are available from China. Ditto auto manufacture. Luxury models are expected to survive but imports may be the future for the rest. Stellantis has announced plan to distribute Chinese EVs in Europe.
That is certainly a factor. At the same time, IIRC, German industrial production was already declining for 4-5 years before the Ukraine war cut off Russian nat gas.
Germany is still dependent on coal, natural gas and petroleum for most of its energy needs. It was more important to shut down all of the nuclear power plants.
BERLIN, May 18 (Reuters) - Germany is expected to miss its 2030 climate goals and likely emit more carbon dioxide than previously thought, an independent advisory body said on Monday, contradicting the findings of the government’s main climate authority.
And:
“In our assessment, the programme’s actual reduction effect is likely to be significantly lower than assumed by the German government,” Schlomann said.
According to data from the environment agency, greenhouse gas emissions remained almost flat in 2025 as a decline in industry and energy sectors was offset by increases in construction and transport. The council also indicated forestry and land use as problematic areas.
Germany probably has the same problems with manufacturing we do. Declining birth rates reduce available labor, increase dependence on immigration and give rising labor costs. Increased competition from imports especially from Asia. And now rising energy costs.
No surprise that manufacturing struggles to deal with new challenges. Robots is an obvious answer but automation replacing humans is a sensitive issue especially in Europe where unions are strong.
German service union Verdi is organizing protests against a round of cuts announced by the German government The plan is aimed at reducing the burden on health insurance providers that could mean higher contributions
