If you haven't stepped out of your door recently, it’s snowing. And it's set to stay freezing for days and days. Or, for our three readers in Munich, congratulations - you get spring already.
Jörg & Axel
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All eyes on Austria
Austria’s daily infection rate is forty percent higher than Germany’s. But while the German shutdown is expected to continue beyond the current deadline of February 14th, Austria reopened large parts of its economy yesterday.
There were reports of hundreds of people standing in line outside of the large retailers lining the Mariahilfer Straße in Vienna, as stores and hairdressers opened their doors after a six-week closure.
The economy desperately needs it. Suffering a 4.3 percent contraction in the fourth quarter of last year, Austria was the lowlight of Europe.
Whether the infection rate stays low enough for Vienna to continue its liberal course remains to be seen. For now, German eyes look on in envy...
(Don’t) save the retailers!
Four of those envious eyes belong to the CEO of KiK, Patrick Zahn, and the boss of S.Oliver, Claus-Dietrich Lahrs. They’ve been demanding financial support for Germany’s largest retailers. In interviews with Handelsblatt and FAZ the two fashion bosses complain that, unless the government extends the financial help currently only available to retailers with revenues of up to €750 million to their companies and 18 others, doom and gloom awaits.
“Our business model works the way it is structured and the way customers expect it to work, not online!” claimed Mr Zahn, who in the interview also complained about missing his bonus.
While e-commerce still only makes up 15% of total retail sales in Germany, one only needs to look west to see what is coming. In the UK e-commerce broke the 30-percent mark this year and the trend is only going in one direction.
Just like Deichmann, Hugo Boss, Peek und Cloppenburg, Thalia and the others, Mr Zahn’s company has slept through 25-years of retail disruption. Unless they get their act together they will go the same way as US brands Barneys, Diesel and Forever 21 did before the pandemic - bankrupt.
No amount of state aid is going to change that.
Too cosy with Mr Laschet?
The bumpy start to Armin Lachet’s life as CDU leader and Chancellor-in-waiting continued at the weekend when der Spiegel published an article alleging that his close relations with the state broadcaster in North Rhine-Westphalia led to a critical report being deleted just hours after going online.
Mr Laschet has already faced criticism over statements which appear a little too forgiving of Vladimir Putin’s vices.
Now, he faces accusations that he and the programme director at broadcaster WDR, Jörg Schönenborn, had “come to an arrangement that worked for both sides.” In practise: Lashet’s government in NRW would give the public broadcaster the best interviews and, in return, the questions wouldn’t exactly be taxing.
But it gets worse. According to der Spiegel, the broadcaster deleted a report on a secret recording of Mr Laschet from 2019 in which he admitted to eco-protesters that he “needed a pretext” to evict them from a forest that was to be flattened to make way for an open cast mine. The pretext he came up with was that the eco-warriors who’d barricaded themselves in tree huts posed a fire hazard.
The report suggests that the journalist responsible for the report was subsequently banished to one of the broadcaster's more obscure channels as he was seen as “a trouble maker”.
"The management doesn't want to mess with the state government - after all, they're the ones who help set the fees for public broadcasters," one WDR insider told the magazine.
WDR has denied the story, saying that it removed the video because “the recording was already well known” and showing it again was legally dubious as publishing secretly recorded footage is illegal.
The Green election
We now know what the centre point of the Social Democrats’ election campaign is going to be: spending billions on making the economy carbon neutral. Chancellor candidate Olaf Scholz said on Sunday that "if we want to be carbon neutral by 2050, it’ll require the greatest technological revolution, the greatest period of innovation in our country that has been imagined in a long time."
He got more concrete: this revolution would cost €50 billion a year.
The Left party went one better when they presented their manifesto on Monday. Titled "For social security, peace and climate justice", it pledges to make Germany climate neutral by 2040 - a decade faster than the SPD.
If you paid attention to the CDU leadership contest, then you’ll know that dealing with climate change was the central issue there too (they of course believe the markets have the answers).
So, corona permitting, this will be the climate election. The Green party will be playing on home turf and should have a big head start on the competition. On the other hand, the other parties all have relatively coherent economic philosophies that they plan to build their carbon-free futures on. With the Greens in an identity crisis (are they conservatives ala Winfried Kretschmann or woolly jumpered radicals ala Claudia Roth?), they might not have such an easy time of it after all.
Who we are:
Jörg Luyken: Journalist based in Berlin since 2014. His work has been published by German and English outlets including der Spiegel, die Welt, the Daily Telegraph. Formerly in the Middle East. Classicist; Masters in International Politics & Arabic from St Andrews.
Axel Bard Bringéus: Started his career as a journalist for the leading Swedish daily Svenska Dagbladet and has spent the last decade in senior roles at Spotify and as a venture capital investor. In Berlin since 2011