by Jerome a Paris
Mon Jun 2nd, 2008 at 03:13:28 AM EST
Munchau is at it again:
Berlin should take note of French reforms
Looking beyond this economic cycle, I am not sure Germany is heading in the right direction. Take energy policy. Despite the high oil price and global warming, Germany remains committed to phasing out most of its nuclear power during the next decade. The 2009 federal election is probably the last chance to reverse the policy.
Nor is there any appetite to liberalise an incumbent-friendly corporate governance system. The banking sector remains woefully unconsolidated. The government has even tried to intimidate the European Commission into not challenging the latest version of the Volkswagen law, which protects the company against hostile takeovers. Germany also remains deeply hostile to full liberalisation of the EU service sector.
'reform' = nuclear energy, locust-friendly corporations, banks that don't know their customers.
The country is in the middle of a secular shift to the left. I do not mean this in purely psephological way. The Christian Democrats of Chancellor Angela Merkel and their Bavarian sister party will probably remain the strongest group in parliament at the next election. The shift is taking place within parties - and across the centre-left spectrum.
In the short run, the most likely alternatives are a repeat of the grand coalition - bringing another four years of gridlock - or a coalition of the left, which would mean four years of anti-reform. I see no constellation that would produce sensible economic policies in the long run.
The left = anti-reform = not sensible.
So Germany, from a position of relative strength, is moving in the wrong direction. France, by contrast, is moving from a much weaker position but it is heading the correct way.
Both are doing badly, as usual.
The left is the root of all evil. Hey, it's easy to be a columnist - when you have nothing to say, bash the left.