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Europe

German Press Review: Trimming Subsidies and Reforming Welfare

German newspapers on Wednesday focused on domestic issues, including proposals to reduce subsidies put forth by two state premiers and a plan from the conservative opposition on revamping the welfare system.

The Rhein-Zeitung from Mainz was happy that there is finally movement on cutting subsidies and reforming the social security system. The paper was particularly pleased that the debate surrounding the subsidy plan from Hesse state premier Roland Koch and North-Rhine Westphalia premier Peer Steinbrück, and the conservatives’ co-called Herzog Commission has made the issues more concrete. But the paper said the ideas presented are not yet committed policy, and now it’s time to start working on them.

The conservative Berlin-based paper Die Welt criticised those ideas – in particular, the subsidy cuts proposed by Koch and Steinbrück. The two have suggested cuts along what’s being called the “lawnmower method.” That means across-the-board cuts of both tax benefits and financial payouts to help the government’s budget. But Die Welt said the lawnmower method is not the most elegant solution, adding it would be better to concentrate on reducing subsidies which are outdated or ineffective and make large reductions there. But the paper said past experience shows that when you try to make these spot-cuts, lobby groups are strong enough to stop them.

The Ostsee-Zeitung from Rostock agreed, saying that lobbyists will also try to sink the Koch-Steinbrück proposals where they can. It said that the debate will be painful about where the lawnmower can be set down and where not. But the paper thinks that Germany will survive the latest subsidy struggle.

The Heilbronner Stimme made the point that the Koch and Steinbrück proposals are a devastating critique of the inability of the government to make reforms until now. It also pointed out that although the proposals are claimed to be the “greatest subsidy reductions in the history of the Federal German Republic”, they will result in only €15.8 billion in savings over three years. It said that the “jungle of subsidies” will be as thick as ever, because the inequality and bureaucratic costs will remain.