“Green German Academic: “old … parts of an economy need to disappear for new parts … to happen”, by Eric Worrall
“shrink in order to be able to invest and develop new technologies,” More job cuts on the way as German economy struggles to recover
Marcel Fratzscher, President DIW Berlin. By Heinrich-Böll-Stiftung from Berlin, Deutschland - Marcel Fratzscher, CC BY-SA 2.0, Link
Green German Academic: “old … parts of an economy need to disappear for new parts … to happen”
Essay by Eric Worrall
“Transformation means change. Change means often consolidation. Companies need to shrink in order to be able to invest and develop new technologies,”
More job cuts on the way as German economy struggles to recover
By Liv Stroud
Published on 06/09/2024 – 14:10 GMT+2•Updated 14:55
…
“German companies have located already a lot of production to China, to India, elsewhere, and this will continue,” Fratzscher said.
,,,
Can the German government help?
Fratzscher said he doesn’t think the government should interfere to retain workers.
“Transformation means change. Change means often consolidation. Companies need to shrink in order to be able to invest and develop new technologies,” he said.
Fratzscher also noted the government trying to keep the old structures in big companies is not just limited to Germany, but also a European phenomenon.
“Often old parts, redundant parts of an economy need to disappear for new parts to be able to happen and to to reappear or to be developed,” he added, suggesting that these crises do not have short-term solutions.
…
“Fratzscher” is Marcel Fratzscher, President of The German Institute for Economic Research (DIW).
Marcel Fratzscher, despite his no doubt impressive economic qualifications, has misunderstood the situation.
The Germany companies aren’t “disappearing” redundant parts of their businesses, they are relocating them to Asia. If those business activities were truly no longer useful, they would disappear worldwide.
When kerosene replaced whale oil for heating and light in the 1860s, companies didn’t relocate their whale industry to other nations to cut costs, they got into the mineral oil business – or were rapidly annihilated by those who did.
The only thing preventing automobile manufacturers and other energy intensive businesses from prospering in Germany is German politicians. Germany companies have no problem recovering at least some measure of economic competitiveness after they relocate to nations with cheaper energy.
As for Fratzscher’s prediction that the Germany economy will recover in a few years, why should the German economy ever recover? A shop which charges too much, and which refuses to accept the direction of the free market, has no hope of ever achieving future prosperity.
There is no chance green energy will ever be competitive, there is no economically viable means to transform unreliable green energy into dispatchable energy, which is what a modern economy needs. The German economy will continue to decline until politicians who have set this disastrous economic direction are replaced by politicians who are less ignorant of real world economics.
5
Article Rating
