Germany’s Painfully Boring Economic Decline

While it’s been known for many years that Germany’s economy is in poor health, the debate about the cause is quite contentious. Some claim that the government should have stepped in earlier while others claim that the government was the problem the whole time. Numerous German governments have tried to tackle this problem, but to no avail. German manufacturing is dying, and there is no innovation and other industries to balance it out. German lawmakers have created a package that they think could be the solution, yet it simply does what they have tried to do in the past by dumping money into dying industries. The three factors of Germany’s decline are still in full force, and the problem will not reverse until they have been removed. High input costs, a government obsession with specific industries, and a regulatory environment that is terrible for innovation are still dragging Germany’s economy down.

Businesses of every kind are struggling from Germany’s sky high costs of almost every input. The high cost of labor has forced employers to reduce employment or find creative solutions where they otherwise would have simply hired more people. Almost every industry pays a higher rate to employees in Germany than the EU. While this brings some skilled labor to Germany, the higher labor costs make it harder for German businesses to compete with the rest of the world. Germany’s commitment to green energy has also skyrocketed energy costs. Required as an input in almost any business, the much higher energy costs are a direct tax on the German people for the sake of the leader’s agenda. Additionally, German and EU protectionist policies stop German industries from buying raw materials or pieces from Asia and other lower priced markets. Every single cost involved with business is significantly higher because of poor regulatory decisions. Businesses cannot be expected to be productive when they bear much higher input costs for almost everything than their competitors.  …