“Now is not the time to talk about money.” You hear this sentence almost every day when it comes to dealing with the economic consequences of the Ukraine war. Supply chains are collapsing, raw materials are becoming more expensive and not only energy prices are fueling inflation. After the corona recession, the Ukraine recession is now looming.
The calls for state protective shields are getting louder. That’s not all good. Of course, many companies have had difficult times. But always calling for the state weakens companies in the long term.
Let’s take short-time work benefits during the pandemic, for example. The Federal Minister of Labor had already priced in the deadweight effects. The number of bridging aids can no longer be counted. The following applies to state rescue operations: Every little animal has its own treat.
Of course it’s true: if the state shuts down with a lockdown, it also has to help. But enough fortune seekers have made their way to cut off a big piece of the government aid cake.
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Apparently, a subsidy mentality is spreading in quite a few management floors. While medium-sized and family businesses are still trying to make the best of the difficult situation, the association officials are pushing ahead again.
And parts of politics continue to give the generous donor uncle. No one wants to point out the side effects of such state happiness. The argument that the crisis must be fought cannot be dismissed out of hand. But there are too many who just want to make their cut.
Subsidy mentality is spreading
The state could certainly become active. If you want to do something about the high energy prices, you should simply let the nuclear power plants run longer. The same applies to coal-fired power plants. They are still online, but of course it would be a signal to the economy for secure cost structures. When it comes to petrol prices, the state is still the biggest beneficiary. If you want to do something in an emergency situation, it would be easy to remedy the situation.
>> Read here: The federal government is working on new economic aid – and a protective shield for the energy industry
With these measures, however, the state cannot influence the economy. There are protective shields, where he can distribute the money as a kind of feudal lord, of course nicer.
Germany came from the social market economy to the state economy of the pandemic. Politicians are currently working on the continuation. It is a dangerous slide into the planned economy.
More on this: Production stops and supply gaps: This is how the war drives the economy into crisis