Newsletter: Finally voting - and no more election campaign / Short cut to the right economic policy after the election - live on 28 February

Elections and election campaigns are democratic highlights. What they apparently are not: times for well-developed diagnoses. This can be confirmed with all caution at the end of this abrupt election campaign in surreal times. Perhaps this even explains the curious invariability of the poll results over weeks amid dramatic upheavals that have kept the world in suspense since Donald Trump’s inauguration and Elon Musk’s entry.

Among the victims of the diffuse urge for simplification is what really (also) plagues Germany. For example, neither the looming climate crisis has suddenly disappeared, nor the tensions caused by the widening gap between rich and poor. The next government will also have to answer whether and how the German export model should be maintained in times of geopolitical permanent crises. The old clamor of market versus state will be of little help – nor will the appeal to return to some “social market economy” (of earlier times). What does that mean? Likewise, simply lowering taxes or raising minimum wages will not help with the major challenges; not even the introduction of unpaid sick days. Which global crisis and its consequences will this remedy?

Despite all the justified resentment about state failure, without a smart industrial policy and a more attractive climate policy things will not work in this world. It also does not help to simply build combustion cars longer – if the German automotive industry is in crisis precisely because the Chinese threaten to outpace them with electric cars.

In any case, there is hope, that after the election, the overbidding with crisis superlatives about the state of the German economy will stop. Yes, many things are not going well, but no, we are not in the worst crisis in decades – (only) because the German economy has not grown in three years. A real recession would feel different. Corporations would not be celebrating new stock records all the time – and the DAX has been performing better than the US markets for weeks.

What use is such a crisis superlative statement? Except to promote dull reflexes. Whoever says that trivializes the crises that Germany had in the years of stagflation in the 1970s – or in the times of West German mass unemployment in the 1980s; or in the structural crisis in the East after reunification. Or in the global financial crisis. Such outbidding helps little in the search for the right answers. On the contrary.

In short: There is also something positive about the elections on Sunday – and the election campaign coming to an end.

We will try a first post-election diagnosis today in a week – in our next New Economy Short Cut on “what could really help the German economy now,” and what the next government should do. We will be discussing this on February 28 from 2 p.m. with

Dominika Langenmayr, Professor of Economics at KU Eichstätt-Ingolstadt,

Sebastian Dullien, Scientific Director of the IMK Institute,

Holger Schmieding, Chief Economist at Berenberg Bank

and Philipp Heimberger, wiiw Vienna

You can already register here.

Have a nice weekend – and happy voting!

Thomas Fricke

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