Interview: Wirtschaftweise Monika Schnitzer: “The state definitely needs a new self-image”
Berlin The economy Monika Schnitzer calls for the new federal government to modernize the state. “This applies above all to the digitization of administration,” said the prominent economist to the Handelsblatt, adding: “We are not well positioned there, and there is really a lot to do.” The aim must be to give the citizens their lives to facilitate.
Companies should also find administrative support. “It is therefore right that the authorities act more proactively and that application-free and automated procedures should be created,” Schnitzer continued. However, the state reform must also be implemented. There is still no concrete plan. “A separate budget for digitization is planned. What is to be financed with it and who administers it is not yet clear. “
Looking back on the Merkel era, the economy said that the political style of moderation worked well internationally “and got us through many crises”. Schnitzer criticized: “What was missing was the answer to the question of where the journey is going.”
But that also applied to the economy. “The industry did not shine with dynamism. German companies are good at building machines. But what will count in the future are new business models. In the future, the automotive industry will earn money with software, not with sheet metal and leather seats. “
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Read the whole interview here:
Ms. Schnitzer, “Dare to make more progress” is the motto of the new government coalition made up of the SPD, Greens and FDP. Much is said about progress, little about the car. What does “dare something” mean from your point of view in the context of economic policy?
That is closely related to progress. Progress always means change. And many people find change difficult, they look more at the risks than at the opportunities that are associated with them. That is why “dare” is exactly the right expression to make progress a reality. The government must dare to bet on progress, it must dare to do so.
Do you think the traffic lights are daring enough?
In any case, she dares a lot. I find it remarkable that I want to start with myself with my progress. The modernization of the state is long overdue. This is especially true for the digitization of administration. We are not in a good position here and there is really a lot to be done.
Are the planned measures to modernize the state sufficient?
The aim must be – as stated in the coalition agreement – to make life easier for the citizens. The companies should also find support in administration. It is therefore right that the authorities act more proactively and that application-free and automated procedures should be created. What I am still missing is how all of this can be implemented in concrete terms. A separate budget for digitization is planned. What is to be financed with it and who administers it is not yet clear.
Vice-Chancellor Robert Habeck has proclaimed the way to a socio-ecological market economy. Is that also a risk?
It is, but a necessary one. And it is a way of bringing the SPD, the Greens and the FDP together.
Ecology means reducing emissions that are harmful to the climate. A market economy means doing this with the help of a carbon price. And social means to make the pricing compatible for everyone. What remains open, however, is the role of industry, especially exporting companies. They should remain competitive and not migrate abroad, despite enormous conversion costs. There are various ideas for this, such as a CO2 border adjustment and differential contracts. It remains to be seen whether that is enough for companies to invest in new systems.
So do we need more state?
If we are prepared to accept that some industries will relocate abroad, we no longer need the state. The question is whether we want that. Probably no government would survive that. Certain industries and groups of people will probably have to be supported in the transformation.
In the coalition agreement, the term “state” appears 172 times, the term “market” 89 times. Are we entering a new age of the strong state?
The state definitely needs a new self-image. He has to make it clear with clear announcements where the journey is going and also do his homework himself. Another reason why the automotive industry held back from building e-cars for so long was because they could trust that the emission standards would not become too strict. If the state wants fewer combustion cars to be driven and less flown, then it must strengthen the charging infrastructure and the railways. And if more renewable energy is to be used, he must ensure that the necessary wind turbines and power lines can be built quickly enough.
And in the next stage, the state could intervene directly, for example by investing in companies.
That wouldn’t be a good idea.
The state is not a good entrepreneur. Public investments block innovations and restructuring. Unlike companies, the state has no strict budget restrictions and therefore pays less attention to costs.
Do you have an example?
Volkswagen is currently showing what happens when the state interferes too much. CEO Herbert Diess had scenarios calculated that 30,000 jobs could be lost when switching to electromobility. What followed was extreme resistance from all sides – especially from the state of Lower Saxony, which has a stake in Volkswagen. I cannot judge whether the dimension brought into play by Diess is realistic. But it is clear that progress can and sometimes has to mean the loss of jobs. But that is hardly enforceable if the state is involved.
If the state does not intervene directly, what changes to the ordoliberal night watchman state that the traffic lights do not want to represent?
The difference is in the goal orientation. The night watchman state would not set any goals. But if we want to achieve the upcoming transformation, the state must clearly set the goals.
Has that been missing in the past 16 years under Angela Merkel?
Your political style of moderation worked well internationally and got us through many crises. What was missing was the answer to the question of where the journey is going. But that also applied to the economy. The industry did not shine with dynamism. German companies are good at building machines. But what will count in the future are new business models. In the automotive industry, money will be made in the future with software, not with sheet metal and leather seats.
Why should something change in the lack of dynamism now? There’s a new government, but industry doesn’t care.
It needs a clear sign that there is no grandfathering for companies that do not develop further. And that we should rely even more than before on new technologies, start-ups or leap innovations.
In your opinion, where is the German economy? Is there still a long way to go in the modern age or does the state just have to give it a little push?
For the most innovative companies, the top of the economy, this is certainly true, you don’t have to worry about them. The problem is the companies at the bottom, whose productivity is not increasing and which are therefore falling further and further behind. They have to catch up if they want a future.
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