Consequences of the crown: turbocapitalism threatens to stop

MeThese days it is very thick. Orders received by the German industry fell 15.6 percent in March, it was announced on Wednesday. Industrial production followed on Thursday (minus twelve percent), followed by exports on Friday (idem), which was the worst decline in three decades.

And even that is just the beginning. According to the EU Commission, German economic output is expected to decrease by 6.5 percent throughout the year. Even if the more optimistic crown scenarios come true and a further improvement begins later this year, it should go until early 2022 before economic performance returns to the pre-crown level.

Economically, the pandemic will mean two lost years for Germany. A setback that would not have to lead to a permanent loss of prosperity if it were possible to provoke an even greater dynamic later.

Also read

But this is exactly where the problem really begins: In the post-crown world, the capitalist prosperity machine constantly threatens to stutter and mock. Turbo was yesterday, tomorrow the piston eater will come.

Overall, critics were correct in their analysis that capitalists around the world were acting unleashed after the collapse of Soviet communism 30 years ago. The organization of work and production was increasingly rigorously subordinated to the concept of efficiency: what was done was to keep costs and prices low.

The consequences were immense: the deepening of the international division of labor has lifted hundreds of millions of people from developing and emerging countries out of extreme poverty and, for the first time in history, created a global middle class.

According to Corona, priorities are set differently

And despite all the downsides, such as trends toward monopolization in the platform economy, it was and, above all, the general population that benefited greatly. The affordable and easy-to-use high-performance computer that everyone naturally carries in their pockets today is perhaps the best haptic expression of it.

In the business world with and after Corona, priorities will be set differently, on many levels. Just in time, for example, the turbo-capitalist delivery principle will have to give way to a security-oriented justification but with fair costs in many areas, certainly in the manufacture of pharmaceuticals, but not only there.

The agglomeration of know-how, in turn, the physical concentration of human capital in the narrowest spaces, was seen as an engine of ideas and innovations, either in Silicon Valley or in the city of London, either in an office open plan or in a modern space for joint work. What will remain of the groups when it is considered that social distancing has no other alternative is not yet predictable.

It is as if the engine oil is turned off from the gears of the market economy and grains of sand are sprayed. Pistons and cylinders no longer function as lubricated, there are friction losses and, in the end, even sudden stop threatens.

Germany could turn towards permanent stagnation. The improvement in recent years has been supported by a total increase in labor and not so much by greater efficiency gains. In 2019, productivity, measured in terms of economic output per hour of employment, even decreased slightly; It was the first time in united Germany, apart from the year of financial crisis 2009.

Politics is now in demand

Because baby boomers are now disappearing from the mass labor market, potential growth threatens to move toward the zero line, with drastic consequences for the long-term financial viability of the welfare state. If nothing happens. Unless efficiency reserves are increased where it is compatible with epidemic containment.

One can confidently believe that the economy has done its part in this regard. Rather, politics is in demand here. You are bound to take old tasks seriously, such as cutting red tape seriously, and refrain from new nonsense, such as the new expansion of the master craftsman’s duty.

Above all, however, you’ll also need to consider how Generation Z can be prevented from disappearing into superior service. Even before the Corona crisis, and despite the huge boom in private sector employment, the police and the Bundeswehr were among the most attractive employers in school surveys.

Also read

Now that the founders’ hosts and freelancers are to blame for the financial gulf due to Corona, the flight to official offices will only be more promising for the following, at a time when the spirit of startups, inventors and researchers it’s just getting more important. Here political creativity is required. Simply adding more to the current 2000 grant programs for startups is certainly not one of them.

This text is from WELT AM SONNTAG. We will be happy to deliver them to your home on a regular basis.