Review of the workshop on the future of the German economic model

Dear friends of the Forum,

what can we say about an event at which almost sixty great speakers and panelists tried to figure out what the future of the German model could look like? What can we say to those who were not there?

That Thomas Piketty thinks that Germany has historically been more progressive than France when it comes to innovative new policy tools, which he sees as a source of hope for Europe? That Nobel Laureate Joe Stiglitz had a fairly peaceful and constructive exchange with German Finance Minister Olaf Scholz – even though he had criticized his predecessor for years for his defense of austerity? Or that Federal Minister of Health, Jens Spahn, explained how the lesson learned from the Corona crisis is a new understanding of the state that is now needed? That his statements signaled a shift of his party away from the declared market liberalism, once proclaimed at the Leipzig Party Congress in 2005, and towards a state that contributes more to areas such as care or industrial policy?

There were new results from the Forsa survey commissioned by Forum New Economy, which show that 28 percent of Germans say that the economic system as it functions today must be “fundamentally renewed”. We saw impressive results from the study on the main drivers of inequality in Germany – and learned about the crucial difference between property owners and tenants. There was the presentation by Dalia Marin who explained how the reunification 30 years ago led straight into the crisis of the economic liberal paradigm and while that created problems for East-Germany the new industrial policy promises a brighter future ahead. Or our own analysis, according to which the demise of market-liberal narratives in German publications was already overturned in the year of the financial crisis of 2008. And of course the lively debate about German economists – with Jakob von Weizsäcker, Nora Szech and Rüdiger Bachmann. And an appeal to the heart.

And what should the new German model look like now? Different. That’s for sure. But we cannot speak for the hundreds of people who more or less actively participated in the workshop over the three days – whether on site at Auditorium Friedrichstrasse or virtually. Just this much: it is becoming clear that, Germany has to stop the increasing inequality between the haves and have nots. And a much better engineered industrial policy is needed, as Rainer Kattel and Mariana Mazzucato have pointed out in their study. As is a new paradigm for fiscal policy, as Michael Hüther and Jens Südekum have formulated practically in their paper with the suggestion of new rules for the debt brake. And future industries should be shaped instead of just bemoaning the decline of the car industry.

Did you miss the talk between Olaf Scholz and Joe Stiglitz. Or the keynote by Thomas Piketty. Or one of the other sessions. All videos, presentations, papers and studies are available now and in the next days on newforum.org. It’s worth it.

Thomas Fricke, Anne Zweynert de Cadena, Marc Adam, Thore Beckmann and Xhulia Likaj