The coalition agreement in Germany has been signed; the Treaty of Lisbon has been ratified. Now it’s time to tackle the challenges ahead: healthcare, pensions and tax policies. In the same spirit, we have to address our international duties. Following Pittsburgh and as Copenhagen approaches, we need reliable regulations for the environment and the financial sector. Germany’s newly appointed political elite faces major challenges. Taboos will have to be broken and breakthroughs will have to be made. Germany needs an agenda 2020 for itself and its global strategic role.

Financial market crisis, companies going under, the healthcare system paralysed, pension provision eroding the public purse, the environment on the brink, green technology becoming American and Chinese, taxes remaining punitive. Europe has its treaty and Germany relinquishes its role as an architect.

The centre-right government is in place: what is its message? “Habemus Papam” and a young hopeful as health minister. Where are the Berlin players who can shape events on the Brussels stage and where are the personalities who enjoy the same status as their US counterparts? How will Germany present itself at the G20, in Copenhagen and in the Council of Ministers in Brussels? How will Germany punch its weight and convey its ideas on the world order that needs to be established following the collapse of the system based on leverage? All this cannot be achieved by sticking to the status quo, selecting personnnel, taking into account their readiness to wait patiently in the wings, carving up jobs based on regional representation and implementing mini reshuffles. That is not the way to preserve and cultivate Europe’s heritage and share it with the rest of the world. There are more talented people than this new cabinet suggests. The world wants Germany to produce more assiduous and more assertive personnel. Organisation is needed for both the process of searching for the right talents in this sense and for the commitment of the public to provide these talented people with societal and media support. Germany’s citizens owe it to their country to implement these initiatives.

Taboos have to be broken and breakthroughs have to be made; not only for the sake of the beautiful and valuable things that this continent possesses, but also because of the justified expectations of the rest of the world that Germany plays its part in shaping humane and dynamic development in future. Environmental protection has to be given a structure in Copenhagen. Following Pittsburgh the casino has to be closed down via smart and strict financial market regulation, and an efficient and global financial system has to be created that promotes sustainable economic development. An open global trading system with reliable opportunities for the participation of emerging markets and developing countries needs to be established by also no longer restricting migration. And Germany could make a big contribution to cooling the international debate about tax havens by announcing a tax structure that would dry out the domestic tax haven of the “shadow economy”, i.e. by introducing a simple and fair tax system. International agreements would then also be attainable without having to send the cavalry:

Germany should campaign in Europe for a “20-20-20” tax regime: 20% for VAT, 20% for corporation tax and 20% for income tax including a withholding tax levied on all investment income at the same rate. Of course fair taxation has to be achieved by granting real tax-free allowances at the subsistence level for each family member.

Germany should also be wanting to set standards in the healthcare sector by devising a model for the future. The key elements are obligatory copayments of 15% of healthcare costs – albeit subject to an income-based upper limit – and the introduction of competition between health schemes, hospitals and doctors.

During this legislative period the course has to be set for expansion in one other sector: continuous vocational training. Pension provision will not be ensured by sticking to the status quo. The participation rate, especially among older members of the workforce, has to be boosted. To achieve this the retirement age has to be raised sooner and to more than 67 in the medium term. Those who live longer must also work for longer. To ensure the employability of these age groups continuous vocational training has to be made the central element of collective agreements and educational institutions – not only from the public sector, but above all also from the private sector – need to adapt to this challenging task. Those who do this in Germany are developing a model that can be rolled out not only soon in many other European countries (above all in the southern and eastern parts), but also in 10 years’ time in the imminently ageing emerging market of China.

It remains to be hoped that Germany recognises not only its domestic mission, but also its European and international duties and that it performs them (more) wholeheartedly. The opportunity to breathe new life into the European mission – with the momentum now supplied by the ratification of the EU Treaty – must not be spurned. Germany needs to send its brightest minds to the European stage and not timidly allow others to lead the way. No-one else believes in Germany’s modesty. It is seen as inappropriate and lacking honesty. Germany must punch its weight!

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Norbert Walter (+49) 69 910-31810

 

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