Why our future is not predetermined

Good morning dear readers,

will we remember 2023 as the year democracy and freedom triumphed over dictatorship and oppression? It seems possible – and at the same time the opposite of it. With its arms deliveries and sanctions, the West has the power to inflict a defeat on Vladimir Putin in Ukraine that would decisively weaken his regime. But it is just as possible that the Western alliance will split and that Putin will get away with a victory peace.

Today we dedicate our weekend part to the global struggle for freedom in all its facets – just in time for the annual meeting of the World Economic Forum in Davos. My colleague Jens Münchrath coordinated the thematic package. The fact that he has a doctorate in philosophy has a positive effect on the depth of the texts, but not negatively on the reading pleasure – I promise!

This also applies to an interview on the subject in which Harvard political scientist Daniel Ziblatt formulated an important thought: “History should not be compared to commuting. I reject the notion that political life is ever automatic. The future is open.”

In other words, there is no law that an era of liberalization is now followed by one of lack of freedom, as cultural pessimists like to whisper. Nor is there an automatic triumph of democracy.

It was never different. Even the period around 1990, which in retrospect appears to us like a single wave of democratization, was in fact marked by setbacks and forks in the road where history could have taken a very different course. How would we look at that era today if the putsch of communist hardliners in the Soviet Union had been successful in 1991?

Time and again, humanity has it in its own hands in which direction it develops. For those who love freedom, this is good news.

One challenge that was foreseeable 30 years ago is the labor shortage. Now he is there. More than every second company in Germany can no longer fill all vacancies, according to the German Chamber of Industry and Commerce (DIHK). The deputy general manager of the DIHK, Achim Dercks, says: “We assume that around two million jobs will remain vacant in Germany.”

This corresponds to a lost value creation potential of almost 100 billion euros. Or around two percent of German economic output.

Immigration and longer working lives are the common recipes for combating the labor shortage – but Handelsblatt chief economist Bert Rürup does not expect sufficient effects from this. He also advocates reversing the trend towards ever lower average weekly working hours.

It has been falling for years – mainly because more and more employees are working part-time. In 1991 it was 14 percent, 30 years later 29 percent. This, in turn, is a side effect of the increasing labor force participation of women.

Rürup advocates opening clauses in the collective agreements so that “all those employees who want to work more can also work more and thus earn more money.”

You can see it like this: the free choice of working hours is a form of freedom. This applies not only to the right to a part-time job, but also to the possibility of working up to the statutory upper limit of 48 hours per week for a correspondingly higher salary – and thus more than the 36 to 40 hours that collective agreements usually provide for.

It was a frequent topic in the morning briefing: At first glance, the economic slump in Russia is surprisingly mild. The World Bank even slightly raised its forecast for 2023 on Tuesday. Accordingly, the Russian economy is expected to shrink by only 3.3 percent in the current year. That has little effect in view of the western sanctions.

But maybe we are looking at the wrong numbers? The Russian economist Sergei Gurijew said at a guest lecture in Vienna this week: “Gross domestic product is not a meaningful tool in times of war.”

Gurijew emigrated to France in 2013 and is now an economics professor at Sciences Po University in Paris. His position: The GDP is not really meaningful in the war, since the armaments production is increased at state expense, which does not benefit the population. Former Deputy Energy Minister Vladimir Milow, who fled Russia, also sees it this way: In Russia, for example, the decline in private consumption in 2022 by almost ten percent is more meaningful.

The German economy, on the other hand, grew surprisingly robustly in the past year, despite the energy crisis, record inflation and material shortages. The Federal Statistical Office published an initial estimate today. Economists surveyed by the Reuters news agency expect GDP growth of 1.8 percent. In 2021 it was enough for an increase of 2.6 percent.

In the current year, too, the severe economic slump expected at times is unlikely to occur. “There is now a consensus that there will be no deep recession like after the financial crisis or Corona in the euro area and in Germany,” said Commerzbank chief economist Jörg Krämer. “After all, a gas shortage has become unlikely.” In addition, the federal government’s aid packages are so large that the state will assume the entire increase in the German energy bill.

Do you actually know exactly what’s in your garage or basement? Yes, exactly, in those brown boxes that you didn’t even unpack after the last move? Probably just the 2002 World Cup schedule and the guarantee cards for long-dead electronic devices.

But you and I are not US Presidents. And that’s why I sympathize with Joe Biden, who seems to have lost a bit of track of what’s stored in the garage of his private home in Delaware. Among other things, government documents classified as confidential from Biden’s time as Vice President. His employees found them there while cleaning up and dutifully delivered them to Washington. Similar finds had previously been found in a private office of Biden.

Of course that doesn’t work. US government employees are required to turn over confidential records to the National Archives after leaving the job. A special investigator should now investigate the matter.

I wish you a weekend where you have better plans than cleaning out your garage.

Best regards

your

Christian Rickens

Editor-in-Chief Handelsblatt