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Economist Stelter: Redistribution Harms the Economy

The German government's social reforms are unilaterally focused on redistribution, criticizes economist Daniel Stelter. This policy is based on false premises and damages the economy's performance, he argues in a guest article for Handelsblatt.

Economist Stelter: Redistribution Harms the Economy
Photo: images.handelsblatt.com

The German government's social reforms are unilaterally focused on redistribution, criticizes economist Daniel Stelter. This policy is based on false premises and damages the economy's performance, he argues in a guest article for Handelsblatt.

SPD General Secretary Tim Klüssendorf has announced that wealth and inheritance taxes will become his party’s “key issue” this year. Raising the “rich tax” is not enough for the Social Democrats. They want even more redistribution. Only this, they claim, can create “justice” in Germany.

In social policy, “fair” is often confused with “equal.” Politicians like to cite research that claims a link between equality and population satisfaction. In 2009, British social epidemiologists Richard Wilkinson and Kate Pickett asserted in their book “The Spirit Level” that more equal societies are “better societies in every respect.”

French economist Thomas Piketty derived from this in his controversial 2013 work “Capital in the Twenty-First Century” the recommendation of confiscatory income and wealth taxes. In 2024, a group of authors from the World Health Organization (WHO) declared “economic structures” to be the “cause of causes” of mental illness. Only radical redistribution (often including restrictions on economic freedom) can make societies healthier and happier, they argue.

Source: www.handelsblatt.com