[huijzer]

I have tried to go against some of the arguments because some are wrong, some are okayish, and some are just plain wrong, but I gave up. The article moves all over the place pulling random facts from all kinds of places in support of the idea that Germany is declining. Maybe that's true, maybe not. This article appears not rigorous enough to come to a right conclusion.

[Michelangelo11]

Right, I have the same impression -- it's really all over the place.

Anyway, the absolute key issue seems to be energy costs. If they hadn't skyrocketed, this wouldn't be happening.

[nradov]

Not just energy but specifically access to natural gas. Even when not burned for power and heat it acts as an essential feedstock for much of the German chemicals industry. With flows from Russia being reduced or eliminated there is no choice but to relocate production.

[gmerc]

And the reason would be that profits were frontloaded and needed reforms were delayed.

Germany had a pretty audacious but absolutely achievable renewables plan 15 years ago but Schroeder & Merkel canned it for cheap Russian Gas and now that the price for that has become apparent there wailing and screaming. It’s just normalizing - if the original plan had been pursued, profits would not have been that great but the cost of adapting would have been staggered too.

Now the bill is due.

[nradov]

You're missing the point. Renewable power generation is nice but it doesn't help with chemical manufacturing.

[gmerc]

Not missing the point at all. it’s two different issues and the same root cause.

Availability of sufficient power reserves not bound to Russia would alleviate many industrial cost issues right now. Costs are up primarily because cheap power is gone.

The chemical industry requiring gas is a separate problem with a similar root cause - supply monoculture. Germany built its first LNG terminal last year, before that it was Russian gas because it was cheap and it was betting on Northstream.

Lack of supply diversity, failure to plan, ideological blinders and good old corruption.

The article is missing the point by failing root cause analysis.

[nradov]

LNG imports won't make chemical manufacturing viable again in Germany. Too expensive. Those industries will relocate closer to the sources where they can connect directly to pipelines.

[FirmwareBurner]

Indeed. People miss the point that metal smelting and chemical plants are built around gas and can't switch to electric over night. Basically entire sectors of Germany's economy have made themselves dependent on that sweeet cheap Russian gas.

[MichaelZuo]

Your missing the parent's point, chemical plants can't switch over to 'electric' at all. It's physically impossible. They will still not 'switch over' even a thousand years in the future.

[Archelaos]

The German government is subsidising gas consumption by industry very heavily at the moment to prevent this.

A press release on the relevant legislation can be found here (in German): https://www.bundesregierung.de/breg-de/aktuelles/energieprei...

The most important section in this matter reads in English translation as follows:

"From January 2023, industrial customers will receive 70% of their natural gas consumption in 2021 from their suppliers at a guaranteed 7 cents per kilowatt hour. For heat consumption, the price will be capped at 7.5 cents per kilowatt hour, also for 70% of consumption in 2021. For the remaining consumption, industry will pay the regular market price."

[nradov]

Right but that level of subsidization is unsustainable. What is the end game? Cheap Russian natural gas is unlikely to return soon enough to save the German chemicals industry.

[Archelaos]

Since the beginning of the year, the wholesale gas price in Europe has already returned to the level seen before the Russian-Ukrainian war.

See: https://www.bundesnetzagentur.de/DE/Gasversorgung/aktuelle_g... (in German)

[HackOfAllTrades]

Same here. It reads like a huge list of cherry-pickings.

You'd think that quoting facts would strengthen ones argument, all these tiny and sometimes very specific facts with no context had the opposite effect.

[still_grokking]

The article was obviously about the big picture.

You get that only when you look at a bunch of "unrelated", "small" facts. If there are a lot of facts pointing in one direction, maybe there is something to it.

The other point is: That was not cheery picking. There are no other facts that would point in the opposite direction… More or less everything in Germany is in decline. That's just true. Source: I'm living here since about 40 years.

Though the article interpreted something quite wrong in the very beginning: The decline started quite exactly around 20 years ago. It was caused by the move to ultra-capitalism (the mentioned big social reforms 20 years ago), which made Germany a low wage country, which made the people poor and started an exodus of the well educated parts of society. The reforms made some of the numbers capitalists are interested in look good for some time, but at the expense of maximally "squeezing out" society. Now this short sighted tactic backfires.

By now almost 1/6 of the people here are poor (and 1/4 is at risk of becoming poor):

https://www.malteser.de/armut-in-deutschland.html

Almost nobody can afford children. ("Bio-Germans" are foreseeable dying out therefore, and it doesn't look like this is avoidable any more when you try to play the numbers game. The article showed the relevant statistic. At least we get some migrants; with children. But the "Bio-Germans" hate migrants. Also this may pay off not before one generation; we need to educate the children; but the education system is broken…)

Actually it's getting hard to even afford a living place. Liberal housing markets made space in areas of high population density so expensive "normal" people can't afford it any more. At the same time building new housing is too expensive and nobody invest in that. Which made companies in the building business die out, and even if the state would massively invest in housing right now we don't have the capacity to build that stuff. And even if we would have the firms, they would not find employees…

https://www.mieterbund.de/fileadmin/public/Studien/Studie_-_...

(Fun fact: AFAIK if Germany would build enough housing it would completely miss it's green goals, as building housing creates a lot of CO₂.)

The complete dependence on the car industry becomes a real problem at the same time. It's not only the big car manufacturers. But the largest part of "the Mittelstand" are external suppliers for the car industry… Should this implode (and it looks like that, as China is flooding the car markets, that's a fact) this will have catastrophic results for Germany. We simply don't have anything besides the car stuff. All we've got is already gone. And what's left is leaving because of he astronomical energy prices.

Big players are moving elsewhere, the smaller ones just die. Result: More people becoming poor, which just accelerates the downward spiral.

In regard to modern tech, like IT, Germany is a developing country. We're completely depended on the US and Asia in this area! People are making jokes about "Russian computers"[1] but the sad truth is we couldn't even build such a thing on our own.

In the last decades the education became completely messed up also. They tried to make everybody go to university; which destroyed the previously high class educational system. By now even the firms offering apprenticeship in handicraft trades complain that you can't find people skilled for that as the people coming from school can't properly read, write, or do basic calculus. (Source: I've talked to people offering apprenticeships, not only once, and I've had some contact to the youth.)

At the same time politics try to just close their eyes to most problems: If you listen to the local propaganda "everything is good" or, currently, "It's Putin's fault!". (That's not completely true, of course, there is some critical thinking even in mainstream here and there, but they hide it usually under a really large pile of straight propaganda; and it became quite seldom. This wasn't always like that. Even the state media was much more critical 20 years ago. By now it's obviously just coordinated propaganda. We actually pay over 10 billion Euro for our state propaganda…)

The article was actually refreshing unpolitical. You usually don't see such "pure" recitation of facts in the local (and especially state) media. (I was waiting the whole time while reading when we "get to the meat" and I get informed what we should buy to safe our souls, or who to blame for all the problems, but to my surprise this part never surfaced. The article looked almost like proper journalism from decades ago).

Just naming those facts is actually considered "right wing activism" here in Germany. You will get canceled quite instantly for saying the things the article said if you state such stuff for example as comment in some of the mainstream media outlets. Yes, they cancel for reciting facts. Especially if the recited facts have potential to "irritate people", and you present some proper numbers to make your point.

(Disclaimer: I'm not supporting any political party any more. I was once "leaning to the left". But the lefties are by now the same scammers as every other political movement. All these people in politics just care about redirecting state money into their own pockets. No difference the "color" or "side" of the political movement. Kleptocracy in it's final stage. Peak capitalism. This won't end good… And if there wouldn't be the language barrier I would actually start to consider to move to China. It's getting noticeably worse here and while looking at the current state of affairs it foreseeably won't get better during my lifetime anymore.)

[1] https://www.heise.de/news/MIG-Akinak-Russlands-selbstentworf... (See also the comments!)

[huijzer]

As a Dutch person who is often in Germany, I agree with you that Germany feels in decline, but we need stronger arguments for or against it. For example, not the whole of Germany is about manufacturing cars. Carl Zeiss, for example, is a big company doing state-of-the-art work.

Do you know by the way why Germany and software don’t go well together? What do you think?

[FirmwareBurner]

>Carl Zeiss, for example, is a big company doing state-of-the-art work

Yeah, but how many middle class families, can these niche super-high end sectors making state of the art optics for the semiconductor industry, feed vs the automotive and industrial sector.

What will happen to Germany's famous manufacturing sector based middle class? Have you seen the job requirements for working at a company like Zeiss? It's MSc and above. All those factory workers can't go get a PhD in optics and physics and switch to designing mirrors and lenses.

It will mean a speedrun of UK's deindustrialization which itself went horribly, with dead cities, homelessness, unemployment and drug abuse. Or it will be like current day France with constant rioting and looting as all those cheap migrant workers Germany invited for their factory work, will be left without jobs.

So the way I see it, the German gov is stuck between a rock and a hard place, needing to use taxpayer money to subsidize a manufacturing industry that depends on cheap labor and cheap energy, to stay in Germany and not off-shore immediately and create mass unemployment.

[still_grokking]

> For example, not the whole of Germany is about manufacturing cars.

Sure! But it's a really substantial part. If this branch of "Germany-AG" gets into trouble this will have noticeable consequences.

> Carl Zeiss, for example, is a big company doing state-of-the-art work.

There is always some company which makes good money and is important. The point was about the big picture. And by now even the usual big players, which are "too big to fail" and are strongly supported by the state, start to get nervous. The article cited quite some of the most important players and some of the most influential economy think tanks.

> Do you know by the way why Germany and software don’t go well together? What do you think?

Complicated question. I don't know, to be honest.

It's not like we don't have any SW industry. But it seems not to catch up.

From the global viewpoint Germany has SAP, but else?

I don't think it's because we "can't do software". But it seems we can't do any relevant software.

Two points come to mind:

We don't have a culture of "pure software products". Most SW is in industrial applications. But this SW isn't very visible, and most of the time it is considered just a secondary or even tertiary part of a product. In the eyes of the management it's often still "just a byproduct" or even "pure cost". The car people for example really didn't get it until just lately that SW is now a primary sales argument. They're still trying to catch up. But actually it's quite laughable what they're doing because they still think you can "produce SW as any other car part"… Same goes for a lot of other companies. SW is just a matter of expense. They don't try to innovate here, they preferably would order somewhere some box with the "needed parts" in it and "concentrate on their business".

Likely related: People who "built mostly machines until now" don't really know how to build SW. So even if they realized that they need SW to make their products competitive they don't know how to get there.

The other thing is: Nobody here really tries to compete with the leaders on the world market. There is no motivation to do so. Even the state buys everything from US companies.

There is at the same time almost no support for local SW companies.

The only exception I know of is actually gaming. Germany invests some (imho symbolic amounts of) money in local game developers. But there are no (proper) big state financed projects that try to create something in the business and/or mass market related sectors.

There are some projects but all the money gets wasted on feeding the big industry players like Siemens or Telekom—which won't produce anything in the end, like always here when it comes to this kind of projects.

In my opinion Germany could actually do something about the software industry issue. We were able to build high-end machines (at least in the past). Software is "just" a different kind of machine… But as long it's politically not wanted to compete with the US software industry nothing will happen, imho.

Germany could inhabit a quite interesting niche, if they would take it serous: High-quality, actually secure, and privacy oriented software, in the high-price segment. This is an area currently under explored. Everything else from the competition is optimized to be cheap, just about bearable from the quality standpoint, and of course it's very insecure. We can't compete with that. But we could compete with the others doing the opposite. (Biggest problem would be to create a market with demand, as most buyers currently also only look at the price tag. One would need to change that, with really outstanding quality. We have here still some good foundational research, also when it comes to IT and software. So we could try to tackle this from that angle.)

[tvon_g]

It's directionally correct though, no? What's the case to be made that Germany is ascending? The fact that most German billionaires inherited their wealth is pretty telling I think.

[Archelaos]

It shows that inheritance tax in Germany is too low and that unfortunately there is no longer a wealth tax.

[pseudo0]

Or just hike the capital gains tax. Those billions of dollars have to be put somewhere, and the ultra-rich aren't going to hide it under the mattress. Inheritance tax is fairly easy to avoid with sophisticated tax planning.

[ttepasse]

Since 2015 I can’t remember Matthew Karnitschnig writing a neutral or even positive article on Germany. The sky is always immediately falling. Back then it was of course the refugee crisis and other assorted culture war nonsense, but now he seems to be retooling.

[polytely]

Honestly, I've never seen a good article from Politico eu.

[haizhung]

Politico is owned by Axel Springer, which is the German equivalent of Fox News, if that explains it.

[alephnerd]

I keep seeing people saying this about Politico and it's total FUD. I have friends who work there and it's pretty firewalled from Axel Springer. This conspiracy theory about the Politico portion seems to have started in r/Europe and r/WorldNews a couple months ago and kept getting repeated since.

[ttepasse]

Matthias Doepfner’s mails and chats including pressure to upsell the FDP in Springer’s papers leaked in April and were widely reported. That’s not a conspiracy theory. If it were, Doepfner could sue. He didn’t.

https://www.zeit.de/2023/16/mathias-doepfner-axel-springer-i...

[alephnerd]

Not denying Axel Springer's practices in Germany.

I'm just calling it as I know it having worked closely with people who currently work at Politico or used to work at Politico,

What happens in the future I can't predict, but were there to be any kind of meddling in a HEAVILY AMERICAN newsroom would

1. Be very openly reported on by their competitors

2. See a massive amount of disgruntled ex-employees leaving for Axios (eg. the exodus at Protocol), The Hill, etc.

3. Wokld be talked about openly as a lot of us have worked closely with Politico members.

[alphager]

So Döpfner (who is on record ordering his "journalists" to push the FDP in the last election) just bought Politico and doesn't make sure they follow the directions he sets for all the other publications owned by Springer? Seems unlikely.

[oska]

A firewall operates purely in the physical world and relies on immutable properties of the physical world to function. To use it as a metaphor in the intellectual/political world (where nothing is immutable) is exceedingly unhelpful and I would say, often deliberately misleading. There is no 'firewall' inside Axel Springer, there is no 'firewalling'. Talk like that is pure nonsense.

[mistrial9]

the name of the publication has the word "politics" in the title?

[alephnerd]

Politico is DC slang for someone who works politics adjacent (hence why their competitor "The Hill" is named that)

Politico started as a blog and newsletter on the Hill back in the late 2000s/early 2010s where we'd leak gossip, but they had amazing product-market fit and ended up opening an EU office a couple years ago (lots of Hill adjacent people also worked in Parliament and Bundestag via early career Atlanticist programs).

A couple of my own quotes have ended up in Politico

[2-718-281-828]

how many planets are there, mr dice?

[rolls dice - dice gives a 6]

unbelievable ... not 3, not 15, but 6 - that's remarkably close to 8!

you're some smart dice, aren't you!