Brussels rejects federal government plans for travel vouchers

Berlin EU Justice Commissioner Didier Reynders rejects vouchers for canceled trips in the corona crisis. He has now given a clear rejection of the corresponding plans of the federal government. “Member States have to ensure that national decisions are in line with EU law – and that gives consumers the choice between vouchers and reimbursement” Reynders told the “Frankfurter Allgemeine Zeitung”.

The EU Package Travel Directive requires repayments to be made within 14 days. According to the will of the federal government, consumers should receive vouchers instead of an immediate repayment when the trip is canceled. The vouchers are to be limited until the end of 2021. If the customer has not redeemed his voucher by then, the organizer must refund the value.

Justice Minister Christine Lambrecht, Minister of Economic Affairs Peter Altmaier (CDU) and Minister of Finance Olaf Scholz (SPD) had already written to Reynders because a voucher solution would have to be approved by the EU Commission. Several other countries also wanted to contact the Commission.

Altmaier had spoken on Thursday to talks with the EU Commission about a uniform regulation for Europe. The reason: For many travel providers, it would be important to be able to issue vouchers now instead of having to refund the money because of the current crisis and the travel restrictions imposed. In this way, their liquidity can be secured in the crisis, Altmaier told the “Bild” newspaper. For customers who are acutely dependent on repayments, there will be a hardship regulation.

Didier Reynders

The EU Justice Commissioner rejects compulsory vouchers.

(Photo: dapd)

The President of the German Travel Association (DRV), Norbert Fiebig, had recently described the situation of companies in the travel industry as “more than just a threat”. According to the DRV, the travel industry in Germany has to cope with a drop in sales of 4.8 billion euros from mid-March to the end of April alone. 3.5 billion euros are currently flowing out of companies for customer repayments at short notice.

Encouragement instead of commitment

“This leads to an unacceptable economic imbalance,” warned Fiebig. “If Brussels continues to hesitate, the German government will have to take action again and take steps to protect the travel industry very quickly at the national level,” said the DRV President. “If tour operators slip into bankruptcy in large numbers, vacationers will lose a lot of money.”

EU Commissioner Reynders advocated “pragmatic and attractive solutions for companies and consumers”. However, this could only be to encourage consumers to accept vouchers, not to oblige them to do so. Vouchers accepted voluntarily should also be refundable if they were not used and insured against the insolvency of the provider.

The federal government had asked the EU Commission for an exemption from the crisis, since the obligation to reimburse also leads to high cash outflows for airlines because of the almost total collapse in passenger air traffic. To this end, the EU government has presented a detailed proposal with deadlines and hardship regulations. To do this, the EU regulation on passenger rights would have to be changed.

However, the Commission does not want to know anything about a derogation. The FAZ quoted a spokesman for the authority, saying that the legal requirements also apply in unavoidable and extraordinary circumstances, such as those that exist in a pandemic.

More: Read here what consumer advocates think about the voucher solution for canceled trips.

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False incentives, fraud, debt: the side effects of the corona crisis

The Chancellor is in top form in times of corona crisis. Angela Merkel explains complicated population doubling rates and reproductive numbers. But she also knows everyday things. “They have to be washed or ironed regularly, put in the oven or in the microwave,” Merkel explains how to care for respiratory masks. “Even if that sounds a bit housewife, so to speak.”

The omniscient state – embodied in the chancellor. The subjects are explained life down to the smallest detail. With this self-image, Merkel takes “measures that have never existed in our country before”. Fundamental rights are restricted, the economy is pushed to the brink and then supported with unprecedented aid.

One of Merkel’s closest confidants, Peter Altmaier, is more than enthusiastic. “An uncle who brings something is better than an aunt who plays the piano”, the Federal Minister of Economics remembers of his childhood.

And what is brought along! If you add up everything the federal government now wants to offer to combat the corona crisis, you get a gigantic sum of at least 1.2 trillion euros. No other country in the world has raised so much money in relation to its economic strength.

Germany has a full 35 percent, far more than the EU average or the USA. Federal finance minister Olaf Scholz did not understate what he promised a few weeks ago: “It is not spilled, but padding.”

graphic

The increase in importance and power is unique. Never in the history of the Federal Republic has a government intervened so quickly and deeply in public life and thus in the economy. After the financial crisis, German government debt rose by 315 billion euros in one year. The value of the federal, state and local governments will be far exceeded in this crisis. “I am worried whether we will be able to return to normal economic policy,” says Lars Feld, Germany’s top economy.

The measures to protect health are understandable. But the question increasingly arises: what side effects do the multi-billion dollar rescue programs have? The free market is disturbed, competition is distorted, prices lose their signal strength.

“As much market as possible, as much state as necessary”, the famous words of former Federal Minister of Economics Karl Schiller lose their meaning every day.

There is a risk of higher prices, inefficient companies and loss of wealth. It is significant that more and more companies are turning to the Bundeskartellamt during the corona crisis in order to be exempted from cooperating with competitors. The new spirit of state economy speaks.

Spend as much as you can. The year 2020 will be disastrous. Kristalina Georgiewa (IMF chief)

Certainly, help for companies with no fault of their own must be provided. But with the flood of support funds, the risk of misallocation is high. Capital and labor are tied up in companies with below-average productivity, less investment and innovative strength.

A few weeks ago, after a parliamentary request from the FDP for possible support from zombie companies, the Federal Ministry of Finance had to admit that “necessary market processes of creative destruction are hindered”.

The concern is justified that the state is eating itself too deeply into the economy, throwing privacy and data protection partially overboard and that the influence on the market will not be reversed after the end of the crisis.

A look at history suggests little good. The federal government is still 25 years after the IPO Deutsche Telekom still the largest single shareholder.

Fundamentally, there is a problem that is known in the economy as moral hazard: companies and citizens behave irresponsibly or carelessly due to existing false incentives. The news of fraudsters sneaking up subsidies is increasing.

“The state is a lousy entrepreneur”

The appearances of Altmaier and Scholz are characterized by superlatives. At the federal press conference, they will be presenting the rescue packages worth billions to the public with great regularity. “This is the most comprehensive and effective guarantee that there has ever been in a crisis,” said Altmaier in mid-March. “This is the bazooka, we’ll look for small arms later,” the Federal Minister of Finance said at the appearance.

The small arms that have now been added are quite large-caliber. Scholz announced a debt-financed supplementary budget of 156 billion euros. This includes an emergency fund with a volume of 50 billion euros, which is aimed at the self-employed and small businesses with up to ten employees.

The federal guarantee for the state bank KfW is increased by up to 450 billion euros. And then there is an Economic Stabilization Fund (WSF) with a volume of 600 billion euros. The majority is earmarked for government guarantees to keep companies liquid.

100 billion euros are reserved for possible investments, i.e. partial nationalization of companies. The battered Lufthansa is already holding talks about state participation.

You can still hear Altmaier’s words: “The state is a lousy entrepreneur.” The Federal Minister of Economics at least dedicated the most beautiful hall in the ministry to Ludwig Erhard. But he is currently just as far away from Erhard’s mantra as the Germans are from summer leaves in Mallorca.

Minister of Economics Peter Altmaier (standing) and Minister of Finance Olaf Scholz (front)

The father of the “German economic miracle” throbbed to measure, he remembered sentences, the state should not be a player, but an arbitrator in the economy. Now the state is preparing to take over the entire football club.

No other industrial country is helping its economy with such large sums as the Federal Republic. This shows a new evaluation by the International Monetary Fund (IMF). He does not criticize Germany, on the contrary. “Spend as much as you can,” advises IMF chief Kristalina Georgiewa. The economic situation is too depressing.

The Council of Experts is now assuming that the economy will decline by more than 5.5 percent this year. This is the case that was previously treated as a worst-case scenario. The economic downturn would be worse than in the global financial crisis. 725,000 companies have registered financial difficulties and short-time work.

Including: hospitals. Health Minister Jens Spahn ordered them at the beginning of March to postpone all planned operations. For the hospital operator, this means severe revenue losses. More than a third of the intensive care beds are not occupied. With the Hospital Relief Act, the federal government created a regulation to compensate the clinics for the failures. But that’s far from enough.

This is the bazooka, we’ll look at small arms later. Olaf Scholz (Federal Minister of Finance)

Some private organizations have registered short-time work, including the Schön-Klinik group. The head of the German Hospital Society, Gerald Gaß, sees the time for a “careful, gradual resumption of regular care”.

Spahn also said last week that clinics could “gradually return to normal”. “We do not want to keep 40 percent of the intensive care ventilation beds in Germany permanently”, said the minister.

The pressure on the companies is huge, the need for help is great. This year alone, the federal government is raising 156 billion euros in new debt. The federal states are also preparing an extensive flood of money for pumps.

According to a survey by the Handelsblatt newspaper among the 16 state finance ministries, they are currently planning 65 billion euros in new debt to fight the crisis. In addition to the federal government’s huge € 1.2 trillion rescue package, the federal states are also helping their companies and the self-employed. Bavaria alone has launched a fund with 60 billion euros.

The IMF chief not only welcomes the gigantic aid package in Germany, the monetary fund also calls for thorough control. “Keep the bills,” said Georgiewa. Transparency and accountability should not be put off in the face of the crisis. Whether Germany is world champion in this discipline, doubts are increasing.

Risk zombie company

The financial crisis shaped a saying by the former head of central bank in Europe, Mario Draghi: “What ever it takes”. In this crisis, it becomes a “Whatever, take it!” Aid is mostly spent without checking, the money cannot be distributed quickly enough.

According to an overview by the Ministry of Finance and the Ministry of Economics, over 26 billion euros were applied for by KfW Hilfen. Almost 13,000 of the more than 13,200 applications were approved. In other words, almost anyone who wants help gets it, most likely companies that didn’t have a working business model before the pandemic.

This easily creates zombie companies that are only alive because of generous state aid. After all: With the large sums, the KfW steering committee seems to be examining it more closely. So far, around 8.5 billion euros have been approved. So it takes a little longer for the large-volume applications.

In contrast, the self-employed and small businesses with up to ten employees are suspiciously fast. So far, according to the overview of 1.65 million applications, around 1.1 million have been approved and more than nine billion euros paid out. These are not loans, but aid that does not have to be repaid.

“Speed ​​and thoroughness go hand in hand: it is carefully checked who receives the money,” Finance Minister Scholz promised. But is that true? North Rhine-Westphalia and Berlin were even recently forced to suspend immediate payments because large-scale fraudsters wanted to get to the pots.

There are also problems with honest entrepreneurs. In North Rhine-Westphalia, for example, the self-employed and small businesses are always granted the maximum amounts of EUR 9,000 and EUR 15,000 – regardless of need. This practice is not well understood in the Federal Ministry of Economics. Because a flat-rate payment of maximum amounts was actually not intended.

The aid should amount to up to 9,000 euros for companies with up to five employees and up to 15,000 euros for up to ten employees. The emphasis here is on the “up to”. According to the Ministry of Economic Affairs, the actual amount should be based on sales and operating expenses for the next three months. An entrepreneur with zero euros turnover and 1000 euros costs would be entitled to 3000 euros in emergency aid.

But these details were lost somewhere in the confusion between the federal states and the federal states. The up to 50 billion euros are provided by the federal government. Although federal money is at stake, it is up to the federal states how much they scrutinize companies. In Hamburg, for example, a liquidity check is required. Other countries are significantly less strict so that aid can flow as quickly as possible.

In Berlin, more than a billion euros were paid out to solo and small entrepreneurs within days. And the Berlin Senate also admits behind the scenes that surely there are also deadweight effects. Since no examination was carried out, almost everyone received 14,000 euros in a combination of federal and state funds. These include the self-employed, who normally have annual sales that are significantly lower, they say.

Some recipients are now voluntarily repaying the aid for fear of sanctions. But whether a subsequent thorough examination is possible to convince fraudsters is skeptical in financial management.

Dangerous false incentives

The economic nonsense, which is operated partly in the name of Corona, is great. Governments in the federal and state governments are increasingly creating the illusion that they can regulate everything with state trillions. And more and more, government intervention and expansion is creating false incentives in all areas of the economy, which can be revenged bitterly.

Take the housing market as an example: the Federal Minister of Justice, a woman from the SPD, wanted to protect the tenants. The result is a half-baked law that gets small landlords into trouble. The law was so badly made that solvent companies like Adidas or Deichmann used the gaps and simply suspended the rent payments. Only after a storm of indignation did Adidas row back.

Take the example of KfW loans: After the institutes hesitated to pass on the subsidized loans from the Staatsbank KfW to companies because they still had to bear ten percent of the default risk, the state assumed full liability. With the danger that house banks will now be able to provide loans to companies that have long been bankrupt.

The banks don’t care, they are released from any liability, but of course they still make good money from their business. The fool is the taxpayer who has to answer for the defaults.

Example of short-time work: Short-time work allowance is a tried and tested crisis instrument. The state replaces up to 67 percent of net wages. However, the SPD was not enough. In the coalition committee on Wednesday, she pushed for an increase to 80 percent.

It is the most comprehensive and effective guarantee that there has ever been in a crisis. Peter Altmaier (Federal Minister of Economics)

However, a general increase would have significant deadweight effects: Many companies are already increasing short-time benefits from their own resources. Apart from that, the short-time work allowance is not meant to secure the standard of living, but rather to ensure the survival of companies and thus avoid unemployment.

In other areas, the federal corona strategy is rather arbitrary. The craft complained that the vehicle registration offices were closed. There is also much discussion about opening shops up to the limit of 800 square meters. This border was communicated at least improperly and caused confusion and indignation among the shopkeepers.

Now a Hamburg administrative court has declared the 800 square meter rule to be illegal. The court could not understand why opening larger sales areas alone should attract more people to the city center. Necessary infection protection measures could be followed at least as well in larger stores as in smaller facilities.

Whimsical and impractical was initially the requirement that repair shops were allowed to remain open, but the sales rooms had to be closed. Many craftsmen wondered if they could lead the customers through the sales room into the workshop. Another detail from this series of undesirable side effects of the rescue policy.

The border closures, for example with the Czech Republic, mean that the bricklayers are missing in the construction industry and the harvest workers in agriculture from Romania. The state decides a lot, but the consequences are borne by the entrepreneurs and their employees.

The argument for the state’s rapid generosity in the crisis is: rather spend more now to prevent the economy from crashing and millions of jobs be lost than have to finance mass unemployment for a long time. This approach is absolutely correct. But it also remains true: somehow the state rescue billions have to be financed at least in the medium term if the next generations are not to be overwhelmed.

Currently this is done through the use of reserves and debts. Germany certainly has scope. The Federal Republic had just pushed the debt level to below 60 percent, thereby meeting the Maastricht criteria for the first time in many years in 2019. But that will be the last time for a long time.

As a result of the corona crisis, the federal government expects a general government deficit of 7.25 percent of gross domestic product (GDP) this year. The debt ratio as a share of all debts in GDP is estimated at 75.25 percent, as can be seen from the German Stability Program 2020.

“The projection is currently subject to very high levels of uncertainty,” says the current report. In other words, the debt level could be even higher. This mainly depends on how high the losses are that the federal government will incur from its guarantees and sureties.

Given the huge commitments, some in the grand coalition are trying to put the brakes on. “I don’t like the fact that we almost always get new suggestions every hour, what else can you do,” said Union leader Ralph Brinkhaus. “All of this must also be paid for.”

In a crisis, the state’s money is loose. Some sense their chance to finally implement long-held plans.

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The economy could collapse more than in the financial crisis

Peter Altmaier

The economics minister commented on the economic consequences of the corona crisis.


(Photo: dpa)

Berlin The corona pandemic could hit the German economy harder than the financial crisis eleven years ago. This is what Federal Minister of Economics Peter Altmaier (CDU) expects. “We have to expect deep cuts in economic growth,” said Altmaier on Thursday in Berlin. The cuts would be “at least as strong, if not stronger than in the 2009 financial crisis”. At that time, gross domestic product (GDP) had dropped by 5.7 percent.

Altmaier assesses the situation a little worse than many economic researchers. For example, the economists in their forecast last Monday assume that the German economy will shrink between 2.8 and 5.4 percent this year – depending on how long the standstill will last. In the better scenario, the wise men assume that the ban on contacts will be relaxed after five weeks.

Altmaier does not expect the crisis to peak until April and May. In individual months, the gross domestic product could decline by up to eight percent, he said. But there is hope that the situation could normalize again in the second half of the year.

The minister did not give a specific figure for GDP for the whole year; the official new government forecast is not expected to be released until the end of the month. The five major economic research institutes plan to present their joint forecast next Wednesday.

The union-affiliated Institute for Macroeconomics and Business Cycle Research (IMK), with its forecast, is of a similar magnitude to that of the economies and Altmaier. Provided that the ban on contacts is relaxed in May, the IMK expects gross domestic product (GDP) to shrink by four percent. If it takes longer, the slump could become deeper.

The Kiel Institute for the World Economy (IfW), in turn, anticipates a recession depth between minus 4.5 and minus 8.7 percent, also depending on the length of the downtime. The Munich Ifo Institute, on the other hand, recently published 18 scenario calculations, according to which the economy could collapse by 5.4 percent if the standstill quickly ended, but in the worst case of a three-month lockdown, it could even drop by up to 20.6 percent.

Altmaier rejected double-digit burglary rates. The economies also emphasized that they consider a three-month standstill to be rather unlikely. Likewise, it is not to be expected that up to a third of all industries will really come to a complete standstill: restaurants, for example, opened delivery services, stationary factories begin to supply protective clothing.

The Economics Minister spoke of a crisis that has never existed in the history of the Federal Republic. Health protection is an absolute priority, so there should be no premature lifting of the restrictions.

More: The Economic Advisory Council assumes a significant decline in GDP in Germany. However, the forecast is less pessimistic than that of the Ifo Institute.

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The corona crisis shows the strength of the social market economy

Some of them now want to cook their ideological soup on these decisions. The daily newspaper “taz” proclaims the “Corona twilight for neoliberalism” because of the state measures. And Juso boss Kevin Kühnert explains in a generous pose that howl of triumph is out of place. The suggestion that he brought corporate groups into play before the crisis was “small-minded”.

Small-minded is above all the attempt to start a fundamental economic debate from the corona crisis. The massive government intervention with a € 1.2 trillion rescue package is an emergency measure. In times of crisis with a massive disruption to the economy, the state as an active player is crucial. However, this is neither a new finding nor particularly controversial.

Even in the United States, unsuspicious of socialism, banks were nationalized without hesitation during the financial crisis. And now the government is back, as the gigantic stimulus package shows. In this respect, the many malicious comments in the direction of liberal economists and politicians, why the market does not regulate it in the corona crisis, miss the point. Nobody ever said what is assumed.

The crucial point is: From the measures in a crisis situation little conclusions can be drawn for the normal state. The state intervention, accompanied by massive debt, is currently justified to ward off permanent damage to the economy and prosperity.

However, this does not mean that it can serve to increase prosperity in the long term. An exception may not be the rule here any more than with the exit restrictions.

The reason is clearly non-economic in nature

Nevertheless, there is currently a strange tendency to seek knowledge or even benefit in the corona crisis in relation to economic policy. In a caricature of the “Süddeutsche Zeitung” the “Covid-19” is drawn as a stone in the gears of “turbo capitalism”.

And green activists ponder the positive effects of the pandemic on climate protection. The virus then becomes nature’s revenge on the globalized economic world, as epidemics were once interpreted as God’s punishment. This is cynical in the face of fatalities, and cynical for those who are worried about their existence as entrepreneurs or who have to fear for their jobs as employees.

This crisis should not be used as a tool to settle economic policies, because the cause of the virus is clearly non-economic. Unlike the financial crisis, which actually exposed an unhealthy level of deregulation and misconduct in the banking industry.

The corona virus, on the other hand, is blind to economic systems; it affects both China and the USA. Differences can be seen in the performance of health systems. And German is not doing so badly, despite undeniable problems.

Contrary to what the critics think, the corona crisis does not reveal errors in the social market economy, but shows its strength. After years of upswing and the black zero, the state now has to counteract all financial strength and put together gigantic rescue packages for the economy. The social network is stable, the coffers of the Federal Employment Agency are well stocked to avoid possible mass layoffs with short-time work benefits.

Private companies are flexible and productive

And not only does the state work, it also works for many companies. Automakers like Volkswagen check the production of medical equipment, breweries produce cleaning alcohol and give it away as a disinfectant to hospitals, textile companies switch from fashion to mouth protection.

This shows not only the flexibility and performance of private companies, but also a sense of social responsibility. It is not a systemic problem that there are negative outliers in all positive examples, such as the sporting goods group Adidas, which uses a law for existential small tenants to cut their rent payments despite the profit of billions. The nice thing about a market economy is that customers can sanction such behavior. The damage to the image of Adidas is now greater than any rent savings.

Despite all the problems and shortcomings that arise in such a crisis, the bottom line is that Corona has shown not only the performance of the health system in Germany, but also the economic system.

More: “Life and health must have priority” – Minister of Labor Hubertus Heil warns of the hasty end of the shutdown.

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How the federal government wants to save companies

Berlin It was an unusual Bundestag session on Wednesday morning. Only every third chair was allowed to be occupied by parliamentarians. The spaces in between had to remain free. President of the Bundestag Wolfgang Schäuble (CDU) asked the MPs to keep the necessary distance of 1.50 meters in the corona crisis in order not to infect anyone. “If there is not enough space in the hall, we have also created space in the visitors’ gallery.”

As many MPs as possible had traveled to Berlin for the meeting to ensure that the chancellor majority needed to adopt the crisis measures. However, the Bundestag stipulated for the future to be quorate even if only a quarter of the members are still present. “Parliamentary democracy will not be overridden,” said Schäuble. Parliament remains able to act.

It immediately demonstrated its ability to act. In the afternoon, the Bundestag hastily passed the billion dollar rescue packages for the economy. The Federal Council still has to agree on Friday.

“Hard weeks are ahead of us. We can cope with them if we show solidarity, ”Vice Chancellor Olaf Scholz (SPD) had previously advertised for the aid packages. Scholz spoke on behalf of Chancellor Angela Merkel, who is still in quarantine at home.

The measures would result in a supplementary budget of 156 billion euros – “a gigantic sum,” said Scholz. But this is necessary to mitigate the consequences of the crisis. In total, including sureties and discounted KfW loans, it is even about aid measures with a volume of 1.2 trillion euros.

Despite this huge sum, artisans, retailers and restaurateurs fear falling through the grate. Emergency aid is available for small companies with up to ten employees, and a new rescue fund (WSF) for large companies, which also grants direct grants as a supplement to KfW liquidity aid – provided the companies have at least 249 employees, 43 million euros in total assets and 50 million euros in sales .

Employer President Ingo Kramer praised the decisions: “What has now been launched is a huge and very targeted aid package,” he told the Handelsblatt.

The rescue package must also be accessible to companies, the associations of hotels, restaurants and caterers, Dehoga and IHA, the retail association HDE and the craft association ZDH demanded.

Fear of overwhelming the rescue package

“Many medium-sized companies with more than ten employees are at risk of falling through the network of federal support measures,” feared craft president Hans Peter Wollseifer. These companies also needed emergency aid, for example when pending wages or subsidizing rents.
Finance minister Scholz promised in the Bundestag that the government would do everything to mitigate the corona consequences. “There is no script for this.” If necessary, the government will decide on further measures. In concrete terms, Scholz already promised employers that he would have examinations made to make tax-free wages that they want to pay their employees in the crisis. That was what medium-sized companies had asked for.

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In the Bundestag, however, other criticisms were initially in focus on Wednesday. A number of MPs were upset with the federal government. Around 15,000 companies are said to be able to slip under the rescue fund.

Union economic leaders fear that this large number could overwhelm the bailout fund – and lead to arbitrary decisions. Therefore, they particularly urged changes to the possibility of the rescue fund to nationalize companies in need. They demanded that the hurdles be raised so that the instrument could not be used indiscriminately.

However, the Ministry of Finance rejected all proposed changes. At 0.08 a.m. Tuesday night the house sent a large package with numerous changes to the law. “That is not possible, not even in these times,” said a CDU MP. “How are we supposed to go through the paperwork until the next morning’s resolution when we get it at midnight?”

Lambrecht for nationalization if necessary

The Federal Ministry of Finance is against criticism. “We have taken up many requests for changes, such as the desire of the federal states to put federal and state programs legally on an equal footing, or to include start-ups in the rescue package,” said the Ministry of Finance. However, one cannot take all wishes into account. And time is short.

Federal Minister of Justice Christine Lambrecht (SPD) also defended the rapid pace. “The current situation requires quick and decisive action,” the SPD politician told the Handelsblatt. She also spoke in favor of completely nationalizing companies if necessary.

“In the crisis, it is imperative that we protect our country’s economic structure and prevent major companies from being sold out or broken up,” said Lambrecht. “The state is ready to partially or wholly participate in companies if this should become necessary.”

However, the Bundestag was able to implement changes elsewhere. For example, companies that use state aid should not be allowed to pay dividends, bonuses or share packages to their top managers. The housekeepers are learning lessons from the financial crisis. At that time, board members of the real estate bank HRE had approved millions of bonuses despite the state’s rescue.

In addition, the Bundestag demands that the state sell shares in companies “at the latest after ten years”, “unless there are urgent economic reasons or reasons that are important for the German economy”, as it was stated in a bill.

“Against this background, the bonus lock for board members makes sense,” said one MP. “This is the biggest incentive for companies to get out of state participation as quickly as possible.” The Bundestag also assures itself of a say. Rescue measures of over 500 million euros are to be discussed in the Budget Committee.

Help without collateral deposited

Another new feature is that start-ups can slip under the protective shield. Up until shortly before the Bundestag session, the details were discussed. Result: All young companies are entitled to help, provided they are systemically relevant and can demonstrate goodwill of at least 50 million euros.

After the accelerated legislation, it is now a matter of publicizing many rescue measures. The statutory health insurance company points out a particularly important point in a circular: On request, companies in need can have the contributions for pension, health and unemployment insurance due for the months of March to May, so that they do not run into liquidity problems.

The employer does not have to offer any security for this, nor is deferred interest or late payments charged. However, the deferral option only applies if other government aid does not work. For example, the expansion of short-time working stipulates that companies are fully reimbursed by the state for the social contributions for lost hours.

More: What the Bundestag has decided in detail.

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“Tough but fair” to Corona: Virologist calls fair-weather flaneurs “irresponsible”

panorama “Hard but fair” to Corona

Virologist calls fair-weather strollers “irresponsible”

| Reading time: 4 minutes

In many companies, the naked fear of existence is rampant

Airports are closed, DAX and Dow Jones are on a historic downward slide. The economic consequences of the coronavirus pandemic are becoming increasingly devastating. For many companies, it’s about bare existence.

State of emergency in the “Hart aber Fair” studio. Completely without an audience and with a safe distance, Frank Plasberg’s guests discuss the consequences of the Corona virus. Under the question “Where do we stand? What’s next? ”, The first broadcasts a two-hour extra program.

Whe guests at Hart but Fair answered questions from viewers two weeks ago. German politics was still hesitant. On Monday the federal government decided to shutdown the states completely – public life will be shut down almost completely. The EU closes its external borders.

Virologist Prof. Jonas Schmidt-Chanasit swears by long Corona months: “We are at the beginning of the epidemic in Germany. The population has to prepare for a long period of deprivation and struggle. ”Economist Peter Altmaier sits to his right – with a two-meter safety distance. The CDU politician, who decided with the federal government to stop public life a few hours earlier, defends the decision: “I do believe that many citizens realize that we have to change our behavior. We have to say that the situation is very serious. “

Psychologist Ulrike Scheuermann sits at the right end of the long hard-but-fair table. Despite the distance, she promotes social closeness: “The phone is now very important. The relationship is more important than direct contact. ”Opposite the cat table are the two ARD experts Frank Bräütam from the legal department and Anja Kohl as stock exchange specialist.

The timpani of the evening

The weekend was sunny, the mild temperatures invited to go for a walk. A picture of the Viktualienmarkt shows the Munich crowd, strolling across the square. For Prof. Schmidt-Chanasit just “irresponsible”. The flaneurs had apparently not yet recognized the seriousness of the situation: “We are not talking about two weeks of Corona vacation, but about several months of Corona quarantine.” What effect this time can only be seen in the future: “We will see the results see only in 10 to 14 days. The measures are drastic, so we’ll see an effect. How strong this will be will be shown. “

Praise to the federal government

Politicians of the grand coalition in Berlin seldom smeared honey around their mouths. This makes praising GroKo politics all the more striking. Stock exchange expert Kohl believes that the German government has “learned from the last crisis.” It has “signaled to everyone that it will cushion the effects of Corona with all its might and alleviate the need. The Federal Republic is in an excellent starting position, debt levels are low at 60 percent of GDP compared to other countries, and surpluses have been achieved.

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Coronavirus crisis researchers

So it was absolutely necessary to signal that you are ready to do anything, says Kohl. The opposite is happening in the US, “which is governed by an almost incapable president who acted too late and only $ 50 billion in the field leads to emergency funding.”

Opportunities from the crisis

The entire program shows that this crisis always offers opportunities. In Cologne, for example, many card buyers of a book fair show their solidarity with the organizer by not demanding any money back so that the organizer does not become insolvent. A prime example for psychologist Scheuermann: “The more the first stress subsides, the more it will become. People like to help. Not reclaiming money is an insistence on his right. This willingness to help is becoming more and more important. We will then get into help mode more. “

It also helps that it is “not for the Corona crisis the Guilty there. We have to meet more and more in the middle. ”Legal expert Bräütom also sees this when it comes to questions about working hours and childcare:“ Flexible solutions will be needed in the coming weeks and months in particular. The legal side is one, but a lot of flexibility is needed now. ”

Encouragement for the next few weeks

Even if the next few weeks will be at least extraordinary, virologist Schmidt-Chanasit encourages: “If you asked me, where would you like to get through the pandemic? In Germany, of course, because we are also a leader when it comes to vaccine development. ”The first tests for a new vaccine will be launched in the summer. Economics Minister Altmaier, however, agrees that the time will be stormy until then: “We also have positive news. The number of deaths in Germany is one of the lowest in all of Europe. ”But:“ It would be irresponsible to say that everything will be over in 14 days. We will live in an exceptional situation for at least the next five or six weeks. ”

But Altmaier also tries to alleviate the fear of the economic consequences and makes an astonishing promise: “We have so many reserves that we can promise that we will do everything that no job and no healthy company has to close and get lost.” If necessary, the financial policy principles will also be abandoned: “We are ready to make debts if necessary, if there is no other way,” says the Minister of Economic Affairs.

The exceptional situation has something good for talk shows: without an audience, the guests let themselves be talked out, respond to the factual arguments of the other person and do not seek cheap applause. The studios of Frank Plasberg and his colleagues are happy to remain empty in the future.

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Federal government wants to quickly introduce extended short-time work

Berlin Because of the economic consequences of the spread of the corona epidemic, the federal government wants to quickly expand the possibility of short-time work. The coalition committee will discuss on Sunday how to lower the hurdles to receive the contribution-financed benefit and to relieve the financial burden on employers. The Handelsblatt learned from coalition circles. On Thursday evening there was a conversation between Federal Labor Minister Hubertus Heil (SPD), Minister of Economics Peter Altmaier and Chancellor’s Office Helge Braun (both CDU).

The group agreed that the Bundestag should quickly authorize the ordinance so that the federal government can put established rules for extended short-time work from the time of the financial crisis back into force – for a limited period until the end of the year.

If the coalition leaders agree, it is planned to lower the hurdles for receiving short-time benefits. According to applicable law, benefits are only granted if at least one third of the workforce in a company is affected by a significant loss of work. In the future, ten percent should be enough.

The short-time working allowance financed by unemployment insurance covers around 60 percent of the net wages lost – and 67 percent for employees with children. Employers are currently required to pay the social contributions due for the lost hours alone. However, 50 percent will be refunded to them in the future.

In the run-up to the coalition committee, the Federal Association of German Employers’ Associations (BDA) put pressure back on. “As a consequence of the health protection measures against the spread of the corona virus, there are already significant disruptions in the global value chains with delivery bottlenecks and partial slumps in the tourism sector,” says a letter to BDA chief executive Steffen Kampeter at the end of February to Heil, Altmaier and Braun had written. In the letter, which is in the Handelsblatt, employers also call for the regulations on short-time work to be attached to a legislative procedure “which can be completed by the end of March”.

Corona briefing

Heil’s “Work of Tomorrow Law”, which has now become the “Law for the Promotion of Continuing Vocational Training in Structural Change”, also provides for an expansion of short-time work and a stronger link with qualification. But the legislative process here will hardly be completed before the summer break. The coalition leaders still have to decide whether Heils law should now be implemented in an accelerated process or whether short-time work should be decoupled.

The Federal Employment Agency (BA) estimates that there will be around 124,000 short-time workers in March – especially in the metal industry, which is affected not only by the corona virus but also by structural change in the automotive industry.

This means that the drawdown is slightly above the level of the sovereign debt crisis in 2012/13, when economic growth was similarly weak, the Nuremberg authorities said in their monthly report for February. The BA can also finance an increased number of short-time workers without any problems. Their reserve was almost 26 billion euros at the end of 2019.

The coalition committee still has to discuss whether short-time work benefits – as in the years of the financial crisis – should be made accessible to temporary workers again. As a rule, they are the first to have to leave the company if there is a drop in production.

The leaders of the Union and SPD also have to negotiate whether working time accounts have to be completely reduced or even minus hours built up before short-time allowance flows. This regulation was suspended during the financial crisis.

More: Profit warnings at German companies – Corona virus is becoming an economic problem.

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