Hey City Zen!

Trump is a cumbersome buffoon. No doubt about that. But while his approach certainly is counterproductive and not that relevant to the US, he is right about Germany's role on global (mostly EU) macroeconomics, defense and I would say even climate---even though Merkel and most Germans try to address some of these concerns. On macroeconomics, we all know that Germany is living off a depreciated euro for its export surpluses. If it still had the mark, it would be much higher given Germany's spectacular trade surpluses. So, especially for the Eurozone, but also with all its trading partners, it should increase consumption, raise salaries, etc. Of course it has no rational, self-interest reason to do that, but since Europeans do not have the power to do it, a little pressure from the US could be a good thing---if it did not come from a mean, dictator-loving, unprepared president following behind on a golf cart. On defense, it is clearly under spending (1.2 of GDP). There are historical reasons for that, but it is time for Germany to live up to the NATO commitments it signed on to, especially given the trade surpluses it has. Finally, on climate. While Germany signs all the right treaties, when it comes to enforcing them, it is not so good. I am convinced that German automakers are involved in the greatest environmental con job ever. The fallacy of diesel engines (on which German automakers have put so much stock and are still defended by Merkel) should make all Europeans furious. We have known for so long that Diesel engines, despite best technical efforts, pollute more than gasoline engines---especially when not well tuned, which is what happens 75% of the time. But with the Orwellian labeling of Diesel engines with green Eco labels, and with criminal lies, German automakers are responsible for filling European cities with Diesel engines. No wonder so many cities, from Madrid to Paris, are struggling with air quality. Yes, other nations' automakers have followed in the diesel fallacy too, but European countries have long created incentives for people to buy those cars (probably with pressure from German automakers), so of course all automakers will try to respond to the market demand. In summary, it is not only the loud mouths we have to worry about. The quiet "experts" and "serious people" in Germany have been pushing failed economic orthodoxy and dirty technology, while not stepping up to their commitments on economics (no penalty for Germany's current account and budget surpluses against Euro rules), security (under-paying what they agreed to in NATO), and climate (the corporate lying on Diesel engines most probably was or should have been known at the highest levels).

Labels: #Climate, #Economics, #Euro, #Germany, #politics, #USA