Merz, Röttgen and Laschet: Who is planning what for the economy?

Saturday, January 16, 2021

Merz, Röttgen and Laschet
Who is planning what for the economy?

By Charlotte Raskopf

Armin Laschet, Norbert Röttgen and Friedrich Merz stand for the CDU chairmanship. With regard to their economic and political ideas, there are in some cases major differences among the candidates. An overview of the candidates' positions on taxes, innovation and the environment.

On Saturday, the delegates of the digital CDU party congress will decide who will lead the Christian Democrats in the future – and thus also have a good chance of the Union's next candidacy for chancellor. Armin Laschet – with Jens Spahn as deputy -, Friedrich Merz and Norbert Röttgen will stand. In a survey published last Thursday by Infratest-Dimap on behalf of ARD, Friedrich Merz is around four percentage points ahead of Laschet and Röttgen, who are on par with CDU supporters. However, it is not the party supporters who decide on the chairman, but the delegates of the party congress.

In times of the Corona crisis, particular attention is paid to the economic policy plans of the candidates: How do you want to rebuild the economy? The CDU organized two discussion rounds in the past few months, in which the candidates for the party chairmanship should compete against each other. But it turned out to be more of a "togetherness" instead of "against each other". Some complained that the candidates were too unanimous and that there were hardly any discernible differences. Often they would agree, mutually reinforce each other's arguments. The three politicians differ in their priorities.

Friedrich Merz – the liberal

Friedrich Merz is the CDU chairman for the second time in a row. In 2018 he lost to Annegret Kramp-Karrenbauer, but was able to unite 48 percent of the delegate votes. In the federal press conference for the announcement of his candidacy, he said he was an "economically liberal, conservative value and socio-politically committed person" and a "convinced European, convinced transatlantic". Merz is considered to be close to business and was in the Bundestag for 15 years and in the European Parliament for five years. His work for the German branch of the US asset manager Blackrock, where he sat on the supervisory board until 2020, also caused a stir. He often cites the fact that he knows "both sides" as one of his strengths.

Merz has repeatedly spoken out in favor of increasing the number of shareholders in Germany. In a comment for “Zeit Online” he called for a “new culture of stock saving”. According to Merz, employees should participate more in the economic success of their companies. In addition, he was of the opinion, different than before, "that the legislature should seriously examine an obligation to private, capital-market-oriented provision for old age, in whatever form".

A project from his past depends on Merz: his demand that a tax return should fit on a beer mat. He would not repeat that today, said Merz in an interview with Reuters in January 2020. But taxes are still one of his favorite topics: In a Reuters interview, he suggested a strict distinction between the taxation of companies and private individuals. In the first candidate debate, he also said that young families should not have to pay real estate transfer tax on their first property purchased and no real estate tax for the first ten years.

With a view to company pension schemes, Merz spoke to Reuters in favor of obliging companies to do so by law if necessary. He was also open to the proposal by the CSU regional group that the state should build up a financial pension cushion for young people.

Merz criticized the progress made in digitization in Germany when he announced his second candidacy. Germany is way too far behind here, and the dependence on foreign – Chinese and American – suppliers is also a problem. The discussion about Huawei is only a substitute discussion for the fact that one has lost the autonomy in the equipment of the digital industry in Europe. Merz clearly positioned itself as a progressive candidate. With him one has the alternative between continuity and departure and renewal. He stands for the latter. A clear announcement to Armin Laschet.

Like the other candidates, Merz is calling for a more ecological economy. German energy policy is not sustainable, he said in his speech on his second candidacy. If you are serious about the transformation of the German economy into CO2 neutrality, you will have an exponentially increasing demand for electricity that cannot be covered by wind and sun alone. He also considers the sole commitment to electromobility to be bad.

He calls for incentives for young companies to stay in Germany when they have developed something. He wants to improve the tax conditions for them. In general, Merz is calling for a new generation contract that should involve and promote the younger generation.

Norbert Röttgen: the foreign policy expert

As chairman of the Foreign Affairs Committee, Norbert Röttgen's profile is strongly influenced by foreign policy. In this area of ​​politics he would probably also set the tone as party leader. For example, Röttgen is in favor of stopping the Nord Stream 2 gas pipeline. With a view to the poisoning of the Kremlin critic Alexei Navalny, he told ZDF that otherwise Russian President Vladimir Putin would think he could do anything. Nothing has been achieved with the previous policy towards Russia.

He also told the "Handelsblatt" that the gas pipeline was not necessary for energy policy purposes. The demand for gas has to fall if one wants to move towards climate neutrality. He described the recently concluded investment agreement between China and the EU as alarming to the "Handelsblatt". It is inconceivable that the EU would conclude a treaty that implicitly accepted forced labor.

With a view to digitization, he wants to catch up "ten to 20 years behind," as he wrote in a letter to CDU members. In the first candidate debate, he also spoke out in favor of digital learning in schools and digital training for employees. Röttgen also promises to work as party chairman for more climate protection. In the second debate, the former environment minister described climate protection as an "economic success model". One has to prove that the conflict between economy and ecology does not really exist. If you keep thinking that climate protection threatens industry, you will not achieve climate protection, stop climate change and undermine the future of industry and the economy.

In his letter to the CDU members, Röttgen announced a new start to the market economy and the burden on small and medium-sized enterprises should be relieved. In the first debate between the candidates, he explained his plans further: The focus must be on a growth policy, on productivity growth, and that requires innovations. There is not enough of that. Among other things, a reputation and image campaign is needed to become an entrepreneur. In an interview with the "Handelsblatt", Röttgen also announced an income and corporate tax reform and said he wanted to relieve middle incomes.

Armin Laschet: the Christian Social

While Friedrich Merz emphasizes that he stands for new beginnings, Armin Laschet positions himself as a candidate for continuity. He said in December that he had the impression that the continuity of Angela Merkel's government policy was finding increasing support. According to his ten-point plan, published together with his junior partner Jens Spahn, Laschet wants to translate the Christian image of man into today's politics.

Armin Laschet is – together with his team partner Jens Spahn – the only one of the presidency candidates who has to actively make political decisions in the pandemic. In 2017 he won the state elections in North Rhine-Westphalia with an election campaign that focused on internal security, de-bureaucratisation, infrastructure and education. The easy course of the NRW Prime Minister in the corona pandemic is partly criticized, for example Laschet was recently one of those who allowed church services at Christmas despite the high number of infections.

At the federal press conference on the announcement of his candidacy, Laschet said Germany must remain an industrial country. One must show the world that it is possible to get out of nuclear energy and coal and still be able to remain an energy country and an industrial country. For a successful energy transition, faster approval procedures are needed, says Laschet.

In the second discussion of the candidates, he set himself apart with a view to the issue of climate and energy and adopted a critical tone. He warned against ruining the German industry through excessive climate measures. However, his ten-point plan also includes the goal of promoting hydrogen research and expanding the hydrogen infrastructure. He also advocates a Europe-wide CO2 price and an environmental policy that "combines economy and ecology".

This article was published on January 14th, 2021 by Capital.de.