A leading German economic advisor is urging fundamental structural reforms to bolster the nation’s future economic viability, criticizing a perceived lack of decisiveness from policymakers Veronika Grimm, a member of Germany’s Council of Economic Experts, argues in a recent commentary that existing conditions are unsustainable in the long term
While acknowledging recognition from political figures, including Chancellor Friedrich Merz, regarding the need for change, Grimm contends that coalition negotiations frequently result in superficial solutions presented as substantial progress
Grimm’s critique extends to multiple sectors, suggesting a pattern of political avoidance of difficult decisions She specifically points to social security systems, advocating for measures such as raising the retirement age, moderating pension increases and eliminating special provisions like early retirement options Current discussions, she argues, often focus on peripheral adjustments that fail to address the underlying challenges
In the energy sector, Grimm calls for regionally differentiated electricity prices, a technology-neutral approach and a dependable carbon pricing mechanism She criticizes the current emphasis on short-term cost mitigation through subsidies, which she believes obscures deeper systemic issues
Similar concerns are raised regarding efforts to reduce bureaucracy Instead of eliminating redundant regulations, Grimm asserts that new rules, such as the recent Tariff Compliance Act, are often implemented, adding to the administrative burden rather than alleviating it