Christoph M. Schmidt, the designated president of the Leibniz Association and until recently head of the RWI – Leibniz Institute for Economic Research, sees the German economy in a critical state. In an interview with Handelsblatt, he compared the situation to the early 2000s, when high unemployment and weak growth triggered the Agenda 2010 reforms. “I believe the situation today is more critical,” Schmidt said. He cited an aging population and a challenging geopolitical landscape as reasons.
The economist is calling for a major reform package. If the federal government explains the measures well, it “doesn’t have to wrap people in cotton wool,” he said. Schmidt considers fears about the AfD unfounded if the government follows this advice. Rather, he said, it is a problem that “every reform debate is stifled by invoking the firewall.”
Schmidt also spoke in favor of a major pension reform and tax relief, for which he could imagine “hardships as a path to solutions.” He will leave the RWI in Essen in a few weeks and become president of the Leibniz Association research network in Berlin.
Source: www.handelsblatt.com
