The COVID-19 pandemic is challenging all aspects of modern society.  Public health systems are grappling with a disease that has spread faster than anything in a century.  Workplaces have lain still, when jobs could not be shifted to remote work.  Political leaders have had to devise plans under short deadlines and communicate them clearly to the public.  And the economic response from governments has been enormous.
In the case of Germany, this has been a remarkable turnaround.  In the span of just a few months, the government’s response has gone from a national one, with caution about how to assist its European neighbors, to the late-May announcement by Chancellor Merkel and French President Macron that they will support sweeping, EU-wide action.  The European Union has now announced plans for a €750 billion economic recovery plan.  That would result in an increase by 40 percent of German payments into the EU budget.
But the primary responses are still national.  Germany’s cabinet has just passed a comprehensive stimulus plan: €130 billion, which is about 4 percent of GDP.  Some see this as a departure for German economic policy, which has been focused on balanced budgets and even run a significant surplus in recent years.  Others would argue that this is precisely what the frugality in good times was for.
The amount of support flowing into the economy through a combination of financial and fiscal programs is mind boggling. Are these efforts up to the task?  And where will it leave us when, eventually, the pandemic ebbs and we survey how our economies have been transformed?
On this episode of The Zeitgeist, Jörg Kukies, State Secretary in Germany’s Finance Ministry, talks with Jeff Rathke and Peter Rashish as AICGS seeks to deepen our understanding of the German and European responses to the crisis.

Host
Jeff Rathke, President, AICGS
Guests
Dr. Jörg Kukies, Deputy Finance Minister (State Secretary) for Financial Market Policy and European Policy at the Federal Ministry of Finance
Peter Rashish, Senior Fellow and Director, Geoeconomics Program