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Klaus Ernst

Germany needs a turnaround in wealth distribution policy

The Chair of DIE LINKE, Klaus Ernst, labels the annual economic report published today a "document of economic policy failure". Germany is not sufficiently prepared for upcoming turmoil caused by the economic crisis. Ernst demands a strengthening of the national economy through a policy of higher wages and greater social security as well as the swift implementation of an economic growth package against the effects of the crisis. He declares:

The annual economic report is a document of economic policy failure.  Europe stands at the edge of a huge crisis. The outlook of the federal government reflects the consequences of an erroneous policy. The year 2012 will bring no turnaround in wealth distribution policy. The average income will increase only slightly more than prices. Exports do not provide any stimulus for growth because Merkel and Rösler imposed gigantic cutback orgies on their European neighbors. Investments collapse because banks find it more attractive to speculate in unregulated financial markets instead of lending money to companies. The national demand cannot absorb those slumps because wages barely increased.

Germany is no anchor of stability but a ship without a compass in the eye of the storm. The conservative-liberal coalition government has done nothing to prepare the country for the upcoming turmoil. We need a turnaround in wealth distribution policy. Thus most of all there must be an income and social offensive. Increasing wages, increasing pensions, increasing social benefits – that is what pushes the national demand and pulls Europe out of the crisis. Wage ceilings must be removed from employment law and reduction factors have to be deleted from the pension formula. Then pensions again can rise along with the wages. All social benefits have to be examined to determine whether they reflect real demands and if they kept pace with inflation. Here the formula applies: those who support the people, support Europe.