On Thursday, German Chancellor Friedrich Merz hosted top executives from the German steel industry at a summit in the the Chancellery to discuss solutions to the deepening crisis. Since the peak year of 2018, German steel production has fallen by around 25 percent.
Germany’s economic crisis is accelerating. Sky-high energy costs, relentless competition from China and India, and the EU’s absurd push for “green steel”—a climate-neutral variant no one demands on the world market—are pushing companies either into insolvency or out of the country.
Thursday’s meeting will bring together industry representatives, unions, and policymakers to chart the next steps for a sector facing its most severe turbulence in decades.
This is just the latest in a string of crisis summits orchestrated by the federal government for media effect. Awareness is demonstrated—solutions? Not so much. For Germany’s economy, political “solutions” increasingly mean one standard instrument: more subsidies.
A One-Issue Summit
Aside from the expected push for protective tariffs, the summit can be reduced to a single dispute: the so-called industrial electricity price. While many energy-intensive companies already receive partial relief, it is far from enough to remain internationally competitive.
Industrial electricity prices have hovered around 16–17 ct/kWh for months. German industry still pays up to 70 percent more than U.S. or French competitors, who benefit from nuclear power as their energy base.
This is the cost of the green transition.
And with it come job losses, shrinking value creation, and, for the first time, sharply declining municipal tax revenues.
Unsurprisingly, the federal government is ready to approve this subsidy. We are deep in a spiral of interventionism.
Hellbound and Down 