As a beginning, we must tackle the reforms that we have been talking about for far too long.
These include non-wage labor costs. By now, absolutely everybody agrees that our non-wage benefits are too high. When will labor costs be freed from financing non-insurance benefits?
The labor market must also be reformed. When will management and labor unions find the courage to sign contracts that permit the recruitment of new workers?
We must also reform our system of government subsidies. Instead of courageously reducing subsidies we keep thinking up new ones. Indeed, many incentive programs have long since ceased to serve their original purpose.
Reform is also needed in public administration. Our public works projects sometimes make me wonder if there is a race between builders and demolishers. Taken together, the many small cases of public profligacy invariably add up to billions. How about a new budgetary law that rewards savings and punishes waste?
We urgently need deregulation. Is it really a law of nature in Germany that you have to apply to as many as nineteen separate authorities if you want to start a manufacturing business, even though it will create jobs?
We must do something about unemployment among low-wage earners. Everybody knows that the gap between wages and unemployment benefits must be large enough to encourage people to choose work over welfare. I am not referring to the much-talked-about mother of four or five children. But why is it so difficult to enforce the principle of a wage/benefit differential for those who really can work? This principle is worth upholding even if we have to pay wage supplements from the public purse, because this would still be cheaper than paying full unemployment benefits.
Another area in need of reform is our system of health insurance. Why are health insurance programs still financing spa visits when they are running out of money for life-saving operations? Ever higher employer premiums are no solution; they just threaten jobs.
And finally, we need tax reform. In light of the events of the last few days, I really can’t think of anything more to say on this matter.
The first step along the path towards the sort of society I have outlined is to implement all the reform initiatives that have done nothing but gather dust so far. We have talked about them long enough: now it is time to act.
But at the same time we must start looking beyond them. We need more than the reforms mentioned thus far to reclaim the future.
I would like to go into this topic in greater detail. Today there is a noticeable trend for people to regard the increase in security gained through state welfare provisions as more important than the loss of freedom that accompanies it. We demand freedom. But what if the citizenry finds freedom too cold and prefers instead the comfort of state welfare benefits and provisions?
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We, too, must embrace future technologies, biotechnology, information technology. A great, global race has begun. World markets are being divided anew, and so are the prospects for prosperity in the twenty-first century. We must start catching up now; we can simply no longer afford a hostile attitude toward technology and high achievement.
The tasks that face us are daunting. People feel overwhelmed by the flood of change, all of it coming at once. That is understandable, for we have built up an enormous backlog of neglected reforms. It will take strength and effort to drive renewal forward, and too much time has already been lost. But nobody should forget that in technologically sophisticated societies, permanent innovation is a never-ending task. The world is on the move; it will not wait for Germany.
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