Our state is needed, just differently. Nobody needs the state, which serves itself and constantly expands the social budget. But what is needed is the state as a clever planner, as an organizer and sometimes also as a financier of large infrastructure projects.
The 21st century is also the century of infrastructure modernization. The state is in demand in three sectors in particular:
He must create the conditions for the electrification of the country. Electric cars and the associated electric charging stations will not be able to grow on their own. The state must set the framework here so that private money can be invested sensibly.
According to a study by the Federation of German Industries (BDI) and the strategy consultancy Boston Consulting Group (BCG), the investment volume – if the state intends to keep its promise – is 74 billion euros just for the expansion of the charging and hydrogen filling station infrastructure by 2030 .
The state must also create the conditions for digital communication and in the form of public administration, hospitals, Bahn AG (which it owns 100 percent) and Telekom AG (in which it holds a 30.5 percent stake) itself take money in hand. It’s about the networking of hardware and software and laws that don’t impede the flow of data, but enable it.
The conversion of the energy supply in Europe’s largest industrial country is a joint task of the state and the private sector. According to a KfW study, the public investment requirement to achieve climate neutrality in Germany will be five trillion euros by the middle of the century – the investment requirement in the energy sector will be 875 billion euros. In addition, billions are being invested to replace Russian gas. It’s about new power plants, additional routes and maritime terminals for receiving imported liquefied natural gas.
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The good news: The global need for investment in infrastructure is also constantly growing. On the capital market, our government should actually encourage that, when it comes to financing private or even state projects, investors are willing to do so.
At the Hessische Landesbank (Helaba) Asset Management Conference 2022, it was expected that global investment needs would increase by 2040. The expert from Helaba Invest estimates the need for investments in the transport sector at over 1.5 trillion US dollars worldwide. Ascending trend.
The advantage of infrastructure investments is obvious: in times of high inflation, fixed prices for long-term projects can lead to above-average returns.
The problem: Our state has not yet grasped the dimension of the task and the need to accelerate it. Germany lives from the substance of its infrastructure.
The freeways are congested, the rail network is overloaded, bridges are crumbling, power lines are missing, and so are filling stations for e-cars – that is the current reality. Other nations build airports, wind farms and high-speed roads much faster than we do.
The traffic light coalition does not initially lack awareness of the problem, but certainly lacks clout. You get the disturbing feeling that she wants, but she can’t. She started almost a year ago with a promise to release the brakes on investments and reduce bureaucracy.
In his first government statement, the newly elected chancellor promised: “Our goal is to halve the length of the procedure. To this end, we will expand the staffing and technical resources of the authorities and courts. We want to tackle this with an acceleration pact together with the federal states.”
There are discussions about this, but rather half-heartedly. The federal-state pact continues to lose shape in endless rounds of negotiations.
The government has become entangled in the tangle of paragraphs. The judiciary continues to complain of a lack of staff. The state is threatened with the dysfunction of all offices and institutions that should now be working at full speed on expanding the infrastructure.
There is sadness. Here are just three examples:
The federal government keeps pointing to the judiciary and also to the federal states, while blocking itself. Specifically, it is about a draft law by Federal Justice Minister Marco Buschmann. The FDP politician wants to speed up approvals for wind turbines, power lines, highways, airports and canals. Proceedings on important infrastructure projects should have priority in court in the future, according to the plan.
Buschmann gets headwind from the Federal Administrative Court, as the Handelsblatt first reported. According to a statement, the plans are “unnecessary in practice and partly superfluous”. What is more explosive, however, is that the justice minister also has opponents elsewhere: namely at the cabinet table.
Environment Minister Steffi Lemke and Economics Minister Robert Habeck are against speeding up the process by law; the accelerated construction of motorways, airports and canals, to use green slang, is not really their cup of tea either.
The Chancellor is more on Buschmann’s side, as can be heard. After months of deadlock on this matter, a top-level discussion on Monday in the Chancellery should bring clarification to the dispute between the traffic light ministers.
Conclusion: The unleashing of bureaucracy and the manifestation of political will are the two keys to the breakthrough of large infrastructure projects. Or to put it more simply: it depends on the chancellor.
Gabor Steingart is one of the best-known journalists in the country. He publishes the newsletter The Pioneer Briefing. The podcast of the same name is Germany’s leading daily podcast for politics and business. Since May 2020, Steingart has been working with his editorial staff on the ship “The Pioneer One”. Before founding Media Pioneer, Steingart was, among other things, Chairman of the Management Board of the Handelsblatt Media Group. You can subscribe to his free newsletter here.
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