Scholz announced in the Bundestag that he wanted to call together representatives of employees and employers for a concerted action. That could prevent an impending recession, according to an expert.

According to an economics professor, the concerted action launched by Chancellor Olaf Scholz (SPD) can help to avoid an impending recession in Germany. He considers the corresponding exchange of information between the government and the social partners to be valuable, said the professor for socio-economics at the University of Duisburg-Essen, Achim Truger, of the Bayern media group (online edition Saturday). Truger is also a member of the Advisory Council for the assessment of overall economic development.

In terms of content, it is about “that the unions do not make excessive wage demands so that there is no price-wage spiral”. It would be important for employers to strengthen collective agreements, said Truger. “In addition, companies should not take the current inflation as an opportunity to use price increases to increase profits, i.e. to trigger a profit-price spiral.” Relief measures that stabilize incomes could also prevent a slump in private consumption.

The risk of a recession cannot be dismissed out of hand in view of the challenges in supply chains and energy supply as well as in view of falling real incomes and rising interest rates. The concerted action could help to avoid a recession.

Klöckner demands permanently lower energy taxes

The economic policy spokeswoman for the Union faction in the Bundestag, Julia Klöckner, has criticized the concerted action by Chancellor Olaf Scholz (SPD). For her, this falls under the category “If I don’t know what to do, I’ll set up a working group,” Klöckner told the German Press Agency in Berlin on Saturday. A dialogue process with the social partners and the Bundesbank announced by Scholz under the term concerted action will begin this Monday. It is about possible measures against inflation.

Klöckner said: “There was enough time to talk, there is no deficit of knowledge either – there is now pressure for inflation and action.” For example, taxes and duties on energy must be permanently reduced, and the so-called cold progression in taxes must be eliminated as quickly as possible so that more of the wages stay in the pockets of the citizens.

CDU social wing calls for tax cuts on staple foods

Before the start of the concerted action by Chancellor Olaf Scholz (SPD), the CDU social wing is calling for a temporary reduction in VAT on staple foods. “VAT on staple foods, which have become up to 40 percent more expensive, must be temporarily reduced. The bag of chips must not be cheaper than the carrot juice,” the newspapers of the Funke media group quote, citing a paper. In it, the board of directors of the workers’ wing of the Union (CDA) also advocates co-payments for Hartz IV recipients and lower prices in local public transport in the long term.