Is the German Economic Model 'Kaput'?

🟥 Investing is risky. Invest responsibly.

📖 This episode was based on Wolfgang Münchau's book "Kaput. The End of the German Economic Miracle".
📖 You can purchase it with the code GTBT40 and get a 40% discount:

Production: Hubert Walas
Research & analysis: Research & analysis: Krzysztof Mazur - Manager, lecturer, and YouTuber. Runs his own YouTube channel called GeoEkonomia. Teaches executive and public management at the Jagiellonian University.
Editing: Hubert Walas
Video production: Kacper Machniowski & Łukasz Szypulski
Voiceover: Hubert Walas
Muzyka: Moments Stopped Time instrumental
Sound realisation: Dominik Kojder

Business inquiries:

#Germany #Europe #Economy #Technology #Transformation

[GoodTimesBadTimes]

🟥 Investing is risky. Invest responsibly.

📖 This episode was based on Wolfgang Münchau's book "Kaput. The End of the German Economic Miracle".
📖 You can purchase it with the code GTBT40 and get a 40% discount:

[fingolfinmorgoth]

One thing that is a real backbone of german economy is its diversification. There are so many small sectors germany is involved in across the field. Many "hidden champions" are small-mid sized companies that are the best in their highly specific field.
There are so many unknown competitive companies that carry the german economy

[marcl.]

> Large industrial export economy closes down nuclear plants, becomes reliant on Russian gas, burns immense amounts of browncoal to make up for it, becomes reliant on Chinese markets, ... What could go wrong?

[gabrielrodriguez]

My dad worked for two major German corporations, and he complained of two problems. One nepotism, this exists everywhere but particularly his complaint and disregard for R&D. The first department they cut/fire everyone, cause lol new tech is a waste of money.

[matfax]

It wasn't a "strange decision" of Kohl to opt for cable TV. It was a corruption scandal. Poor research either by the channel or the book author. Most Germans know this.

[abraham]

I would say the biggest problem is the overall mindset of the German population and political elites. There is mistrust towards progress. A tendency to overrely on the state. To throw money at problems without a real plan. Excessive nimbyism turning every project, no matter if it's a railway, tunnel, factory or even university, into a nightmare, combined with a slow bureaucracy and overregulation. Building things takes YEARS. For decades, German governments were not able to build enough housing in expensive cities. This and massive russian disinformation and propaganda warfare is fuelling political extremism, which makes it all ten times worse.

[TrangleC]

Few things have been declared dead prematurely as often as the German economy.
In the 70s people claimed greedy unions would destroy the economy.
In the 80s the Japanese would drink Germany's milkshake and automation would make everybody unemployed.
In the 90s the German car industry was a outdated dinosaur that could not compete with the super innovative French and Scandinavian competition anymore.
In the 2000s the Chinese would destroy the German economy.
In the 2010s the Euro crisis and competition from Tesla, from Turkey, Poland and other up and coming "Tiger States" was to spell the end of the German economy.

And throughout all those predictions by American think tank eggheads knowing for sure that Germany was doomed, it kept booming and getting richer.

Of course that doesn't mean that it can't go south eventually and maybe now the end is near for real, but it is remarkable that not one of those smartypants experts ever said one good thing about Germany and not one of them predicted that it would have the success it had for the last 30+ years.

[viktorsocial]

When I first visited Switzerland i truly understood the saying - "Germans want to be on time, but do not change a lot for that to happen, besides complaining. Swiss are actually on time and create politics and rules that actually make sense in order for this to happen." This hit hard and also applies fully to other aspects of society. Sometimes you see a rule in Germany and you think - it's completely counterproductive, but yet it is insisted that it's continued. This stubborness has proven fatal in many cases in german history and needs to adapt in order not to fall victim again to the natural selection of societal and economic levels and mark further "weitere" downfalls. Unless there is some cultural masochism in all of that, but that's another topic.

[niklasweber]

As a german I can tell you guys one thing: the title is entirely wrong, it's "kaputt" not "kaput".
Totally unacceptable

[oliverstianhugaas]

>Base economy on "German Quality".
>Hurt the manufacturing industry.
>Work agains German culture.
>Act surprised that industry buckles.

[Barwasser]

As a German I think your analysis is accurate to a large degree. However, you overemphasize the problem with low public spending and underestimate the impact of our ability to self-sabotage every step of the way.
Even if we had taken on massive debt like many other nations in Europe, our situation would not be much better. In fact, throwing money at our problems and expecting them to magically go away has been the default solution since 2008 and hasn't really worked out all that well, since the underlying issues were not resolved. This is true for the Euro-crisis, migrant-crisis, demographic crisis, green transition/energy crisis, Covid and now Ukrain. Taking on more debt without a clear vision would have only resulted in us wasting more money. More important then our spending habits are our cultural issues:
- We are experts at maintaining and incrementally improving the status-quo, but are very afraid of taking the next big step. The example you mentioned regarding digitalization is perfect.
- our inability to assert ourselves and pathological altruism has resulted in millions of illegal immigrants taking advantage of our social system at the expense of potentially productive migrants. In the past 2 decades we have become one of the counties with the most migrants, but as you mentioned unlike America we have not attracting talent. This is because it is not planned, or steered migration but simply the result of leaving the door open and being too afraid to tell people to leave.
- somehow we "want it all" as you said in the introduction. We want to save the Euro, save Europe, save the environment, save refugees from all over the world, get rid of nuclear, get rid of the combustion engine while relying on taxes from the car industry to finance all our projects.

[valentinstoyanov]

I studied at the University of Hamburg 22 years ago. Back then, there was no Internet in the dormitory and a friend of mine from the United States was complaining all the time explaining that Internet was ubiquitous in the USA... Just a small comparison between the two countries in the early 2000s.

[Klonen]

You forget to mention that ther's no problem with influx of foreigners to Germany, but the focus is on low skilled non educated people. And that strategy is making a blueprint for the future of Germany.

[Alan-lvrw]

Germans pay 4x what Americans pay for energy. It’s hard to be competitive in that situation.

[MysteriousSubculture]

A pandemic couldn't force German to change its stance on debt until Trump came along? Nah that's crazy😂

[Medicine]

It’s crazy how pervasive the idea that more deficit spending is what Germany needs—especially with a declining natural population. This is the path to a future sovereign debt crisis and it will take the whole EU with it.

Greece’s debt crisis shook the EU over a decade ago. All the EU countries running massive deficits with large amounts of pensioners will collapse the EU.

[nero-oy]

Minor nitpick germany dident experience hyperinflation in the 1930s. It experienced hyperinflation in the early 1920s. During the 1930s when the Nazis took power the great depression caused deflation

[Saufsldat]

You have to be pretty blind not to see the looming collapse. A mere 15 million people actually pay more in taxes than they receive in a country of over 80 million. A rapidly aging professional workforce that is not being replaced due to low birth rates and uncontrolled immigration of unskilled non-labor. A bloated public sector and bureaucratic nightmare for private businesses.

[moritamikamikara]

Do an analysis of David Betz.
You cannot see the problems in Western Europe, because you are Polish, and do not suffer from them.
Things are getting bad here... real bad.

[yourneighbourhooddoomer]

Historical fun fact regarding this whole topic: It was in 2013 (!) that Merkel infamously said "Das Internet ist für uns alle Neuland." meaning that "The Internet is new territory for all of us."