Guten Morgen!

We wish you a wonderful start into your weekend and week with the newest Krautshell edition.

Enjoy and ping us for more!

Anna                                Christian

#RoadToBTW21 Armin Laschet and What His First 100-Day-Program Could Look Like

Admittedly, speed is maybe not the first thing that comes to mind when you think about Armin Laschet. Still, the CDU Chancellor-candidate aims for more pace, especially in the state and its administration. Laschet strives for an administration that enables streamlined processes in areas like investment or founding companies, all while still obeying the rules (in Germany we LOVE rules).

To make Germany climate neutral by the middle of the century, Laschet’s (inofficial) 100-day-program incorporates a higher CO2 price. In theory, this should lead to more investment in climate-neutral technologies while simultaneously reducing other costs like electricity taxes. Laschet’s vision for the German state is one in which the state only controls the basic conditions, allowing citizens to be largely autonomous. Here, he sees a considerable contrast to his probably biggest opponent, the Greens, who generally strive for more regulation. That being said, where exactly he wants to promote the independence of citizens is still open. One central point of his would-be 100-day-program is most certainly the establishment of a “Germany fonds.” To not conflict with the German debt brake, the CDU-man envisions an investment vehicle financed by both public and private money. This tool could fund promising infrastructure, green and digitalization projects and in turn generate profits for the creditors. This would certainly be something new for Germany. Whether all this can be fulfilled in 100 days is still an open-ended question, because just like with Laschet, being fast is not the first connotation that comes to mind when thinking about Germany and its legislative process.

Get Me on the Moral High Ground!

This week, US President Biden created quite some chaos in the EU when he expressed his support for a waiver of COVID-19 vaccine patents. While the EU always enjoyed its position on the moral high ground in questions of global solidarity, we now find ourselves in a situation in which we look like big pharma-advocates instead of the saviors of the world. So far, (not) so good. But what’s behind the EU position? Conservative powers in the EU don’t support the waiver because they fear the threat of getting “nothing” (in financial terms) for their work will result in a sharp decrease in pharma companies’ research quality. On the other hand, the EU sees the evolving crisis situation in India and recognizes a need to act in order to solve the COVID-19 crisis globally. Whether a waiver for the patents would help here is certainly a worthy subject for a debate we don’t want to open here.

What really perturbs the EU is the US’s refusal to participate in initiatives like COVAX and the fact that while the EU exported some doses to countries in need, the US has not. Still, the EU looks like the villain now. The patent waiver could evolve into a solid crisis in transatlantic relations. Certainly, EU politicians now understand that even if the tone is softer under President Biden, he still plays hardball. Irrespective of how it’s done, both powers must find a way to supply vaccines poorer countries. Otherwise, China and Russia will create new dependencies in developing countries by distributing their own vaccines. This cannot be a desired outcome for both the EU and the US. We keep you posted on the EU side of this discussion.

Let’s Get Critical: Greens Party Program Put under the Microscope

In Germany, political parties share their positions through official party programs, and the Greens led the way earlier this year by introducing their program in mid-March. Whether you like it or not, all signs are pointing towards Baerbock and co. being a part of the next German government, which means the Greens must be well-versed in all policy fields, not just environmental policy. This week, the Economic Council, a German business association representing over 11,000 firms from a wide range of industries took a closer look at the Green’s program and gave its feedback. We believe it’s always a great exercise to critically analyze political positions, especially when the stakes are so high. Therefore, here are the most interesting points from their review.

First, the Greens suggest concentrating government investment in “sustainable lighthouse projects” for Greentech, AI, and sustainable mobility. Here, the Economic Council pointed out that while government investment in innovation needs a boost, the decision in who or what to invest in should not lie with the government as it has not “distinguished itself” as an effective “market scout for future technologies.” Furthermore, the Greens suggest that “relevant acquisitions” by tech companies should be examined by the Federal Cartel Office to prevent buying up of competition. Industry representatives countered with a suggestion that the Federal Ministry for Economic Affairs develop regulatory guidelines for acquisitions instead of examining them on a case-by-case basis. Finally, the Greens insisted that interoperability of digital services “must be ensured.” The Economic Council pointed out that the commercial success or failure of many companies today depends on data, suggesting such a requirement would lead to “undesirable developments.” If you’re interested in finding out more about what the Greens’ plans could mean for your business, reach out to us!

Climate Protection as Mandated by The Constitution

This week, the Federal Constitutional Court made a groundbreaking ruling. Protecting the climate is mandated by the constitution, as non-action would directly cause less freedom for future generations in Germany – and protecting the freedom of the individual is a duty for the executive power in Germany. This ruling also means that the latest climate protection law in Germany must be adapted to be more ambitious. What’s about to come?

Until 2030, greenhouse gas emissions shall be reduced by 65% compared to 1990. To put that in comparison we had a reduction by 40% in 2020, also “supported” by the COVID-19 pandemic. Until 2040, the government aims for a reduction of 88% and in 2045 we want to be climate neutral. This means the energy sector needs to reduce CO2 emissions by 65 million more tons than initially planned in the latest version of the climate protection law. Along these lines, industry must get rid of a further 21 million tons. This could be achieved with a higher price for CO2 (see #RoadToBTW21 article above). 80% of Germany’s emissions stem from the energy sector, creating a demand to rapidly expand wind and solar energy as well as accelerate market entry for hydrogen technology. Possibly, the new situation could even lead to an exit from coal energy by 2030 instead of 2038. All in all, the new law will likely already appear next week. Still, we are awaiting some discussions, certainly more around the “how?” than the “what?”.

Conference on the Future of Europe: Groundbreaking or Surface-Level?

Back in March, we introduced you to the Conference on the Future of Europe, and on Sunday (Europe Day) it’s launch day. Quick reminder: the “conference” is a project to involve the European citizenry directly in the future of the EU and increase the institutions’ democratic legitimacy. While the kickoff event in Strasbourg is meant to be a grand celebration of the EU’s ideals of inclusiveness and progressiveness, the lofty goals of the initiative have been slightly overshadowed by the countless, minor squabbles taking place among the organizers.

First, it wouldn’t be a true European Union initiative if its structure and the resulting responsibilities weren’t overly complicated. The Conference has an executive board and a plenary, the former consisting of high-ranking EU officials (think Ursula von der Leyen) and the latter consisting of members of the European- and national parliaments. These two camps have yet to decide what exactly the plenary will do. On one hand, it could act as a mediator, processing citizens’ ideas and voting on final conclusions. However, the European Council would prefer the executive board to take on this role, as this situation will lend itself better to silently sweeping ideas that are “too radical” under the rug. Which, in turn, has raised two questions: what is the point of the plenary? And, why bother with a citizens’ initiative if the executive board just cherry picks its favorite ideas anyways? A second, and very decisive point of contention is the final outcome of the initiative. Can the conclusions reached by the conference make a lasting impact on the EU by, for example, laying the groundwork for amending the EU treaties? Or, will the conference’s recommendations get lost in the all-too-familiar abyss of well-intentioned but non-binding EU initiatives? Opinions are currently split on the matter. As we like to say in Germany, die Hoffnung stirbt zuletzt (transl. the hope dies last).

CovPass App – Time to Travel

Our vaccination rate is increasing, so it’s time to think about travelling. To do so, this summer, Germans and Europeans will need a proof that they are either vaccinated, immune, or negatively tested. All this shall be possible for Germans with the so-called “CovPass” app. An app developed by various companies around IBM and the Robert-Koch-Institute (the guys in charge of fighting COVID). The app saves your vaccination record, a past COVID infection or a negative test result so that you can enter restaurants, theatres or the beach in Mallorca.

The app operates EU-wide and according to Gottfried Ludewig, who is Health Minister Spahn’s guy for digital stuff, first talks with other states such as the USA are ongoing as to whether they also accept the app. This would enable the EU to finally be the first to develop anything digital – an award we rarely get. The app will be interoperable with our Corona warn app in which we so far could save test results and also see whether we had contact with infectious persons. Everything will be open source, so the integration of the technology in other systems will also be possible. It seems like everything will also be privacy-proof and, most importantly, it should be ready before the summer holidays. We are certainly desperate to enjoy some vacation time and if in the end we can even visit you in the US again, life will certainly look MUCH better.

• The Story of Sophie Scholl: German public broadcasters started a new project in which the last 10 months in the life of the Nazi resistance movement member Sophie Scholl are portrayed. In the project, Sophie Scholl has an Instagram account with pictures and stories, accompanied by some historical material. Probably one of the coolest forms of teaching history, so far.

• Coalition Agreement: A few weeks after the federal state elections in Rhineland-Palatine, the coalition is set. The SPD will continue the governing coalition with the Greens and the FDP, a model that some people would also favor after the federal elections.

• AstraZeneca for Everyone: This week, the government decided to lift the prioritization rules for the AstraZeneca vaccine, meaning all Germans are eligible for a shot. We’re expecting quite some interest, especially since it seems like protective restrictions will be lifted for the vaccinated.

LET THEM OUT

The vaccination campaign in Germany is picking up, FINALLY. Currently we are vaccinating around 1 million people per day, 31.5 % of the population received the first and 8.8 % the second shot.

Now, you would think everyone is getting excited, eager to get a vaccine and above all, to end lockdown and let everyone enjoy their newly gained freedom. But instead, the dominating question is whether we should allow the vaccinated to enjoy certain freedoms or make them wait until everyone else has had their shot at a shot.

Honestly, this seems to be a tough question only in Germany. Just last week I read a heartbreaking report about a home for the elderly where all the inhabitants, after months and months of isolation in their rooms, without any visitors, now fully vaccinated, are still not allowed to have their meals together with the other, also fully vaccinated residents.

Yet still around 40 % of Germans don’t approve of lifting restrictions for the vaccinated or recovered. I don’t even know what to say about that. The only thing I can say is that I am grateful our government does not pay attention to these voices but does what seems to be the right action to any rational person: Lifting the restrictions for the vaccinated, starting this weekend.