https://www.yahoo.com/news/entire-industries-germany-could-c…
Entire industries in Germany could collapse due to Russian natural-gas supply cuts: union head
“Entire industries are in danger of collapsing permanently because of the gas bottlenecks: aluminum, glass, the chemical industry,” Fahimi, the head of the German Federation of Trade Unions, told Bild am Sonntag. “Such a collapse would have massive consequences for the entire economy and jobs in Germany.”
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Germany has been setting to go to Supply Side Economics.
Don’t envy them. It never works for the country.
Dont worry about Germany. No need.
Entire industries in Germany could collapse due to Russian natural-gas supply cuts: union head
“Entire industries are in danger of collapsing permanently because of the gas bottlenecks: aluminum, glass, the chemical industry,” Fahimi, the head of the German Federation of Trade Unions, told Bild am Sonntag. “Such a collapse would have massive consequences for the entire economy and jobs in Germany.”
Germans are highly paid with good benefits, perhaps they should offshore industries that consume large amounts of energy to countries that have surplus energy and less expensive labour?
Anymouse <off to watch a couple more episodes of “Servant of the People” … hilarious!>
Economist Tyler Cowen writes about this subject:https://www.bloomberg.com/opinion/articles/2022-07-07/german…
For decades there has been too much emphasis on the importance of the German trade surplus to the country’s prosperity. No one claims to believe in the doctrines of mercantilism anymore, yet they reemerge time and again. To the extent Germany has been a wealthy nation, it is due to its productivity and human capital — not any pattern of trade surplus or deficit.
For purposes of contrast, Australia ran a trade deficit for decades, from 1975 to 2019. During those same years, it evolved into one of the finest places to live in the world.
The declining Euro will make Germany cheaper & aid in lessening the trade deficit.
The real problem for Germany according to Cowen:”And then there is what may be Germany’s biggest problem: complacency. In the last 20 years Germany’s primary education system has had a mixed performance, albeit with some improvements, and its infrastructure is no longer perceived as so efficient or high quality. Yet reform was not imperative, partly because things were going OK enough in Germany.
There is a chance that the current crisis will jolt Germany out of its passivity. Throughout history Germany has managed to reverse some very bad situations, as it did after the devastations of the Napoleonic wars and World War II.
Keep in mind that human capital is the most important determinant of national wealth, much more important than the flows reflected in the trade account in any given month or year. If German reforms boost the ability of the country to train students and to put its people to work, the long-run payoffs could be very high.“
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tj,
Germany is aimed at supply side econ. Germany is going to get poorer. The wealthy Germans much wealthier. The old family businesses like a few breweries in many towns wont survive. Germany’s goal is to make its self more of a tech wonder house than Silicon Valley.
The US is going towards demand side econ. The US is going to be much wealthier.
A shell game over the next 70 years.