The scientific advisory board of the Market Economy Foundation is calling for a reform of industrial policy in Germany. In view of rising energy prices and European climate protection goals, the federal government is not taking the necessary measures to make Germany a more attractive industrial location, the economists led by Ifo President Clemens Fuest criticized on Friday. The economically liberal professors on the advisory board, also known as the Kronberger Kreis, particularly reject the state-subsidized industrial electricity price demanded by Federal Economics Minister Robert Habeck (Greens).
Habeck announced in the spring that he wanted to provide state support for the operational costs of particularly energy-intensive industries in order to compensate for competitive disadvantages. However, the proposal is also controversial within the government. Instead of subsidies, the scientists are calling for a broad-based energy policy that also relies on nuclear power again, as well as measures to increase the general production supply, such as relief for companies. Economist Lars Feld cites the USA as a positive example, where companies are taxed and regulated less – to the advantage of the economy. “If you have an idea in the USA, you can implement it relatively quickly and easily, whereas here there are high regulatory hurdles,” said Federal Finance Minister Christian Lindner’s advisor. Experts demand that the state should not shield individual industries and companies, such as the US chip manufacturer Intel, from competition through subsidies. This prevents the necessary structural change in the industry. “There’s a lot of talk about transformation, but politicians are afraid of their own courage. First you make energy scarce and then you’re surprised that energy-intensive industries are leaving and you get scared and start subsidizing against it,” says Fuest.