Thursday, February 6, 2020 | The National Press Club, Washington, DC

MP Johannes Vogel, Member of the German Federal Parliament, Spokesperson for Labor Market and Pension Policy and Secretary-General of the Free Democratic Party in the state of North Rhine-Westphalia spoke at an event organized by the Friedrich Naumann Foundation North America office on the subject of “Germany’s Unaddressed Challenges for the Next Decade.” In the beginning of his remarks, he addressed the political situation in Germany in the aftermath of political developments in Thuringia.

The election results in the state of Thuringia and the most pressing unaddressed challenges that Germany faces – demographic change, digitalization, and climate change – are interconnected. Democratic centrist politicians in Germany have concrete problems to solve and must orient their perspective towards future decades, rather than only thinking in terms of the next election cycle. If politicians in Germany do not think ahead to future decades and propose innovative solutions, MP Vogel argues, extremists on the right will take advantage of that void and redirect the discussion to issues, like anti-immigration identity politics.

Even when compared to the situation in other European countries, Germany has a rapidly aging population, with members of the baby boom generation in Germany retiring in large numbers. For many years, German politicians have discussed how to reform the pension system to adapt to these demographic changes. With the German pension system’s expenses also increasing, politicians introduced a reform package into Parliament, but no one has yet determined how to pay for it. It is a priority for Germany to figure out how to compete in the global marketplace under these conditions. If Germany wants to maintain the levels of its current workforce, which already includes skilled labor shortages, Germany needs to increase its skilled labor force by at least 250,000 per year until the year 2035.

This holds especially true given the rise of automation and digitalization in the workplace. The fear that workplace automation will create mass unemployment has existed for many years in Germany, as can be seen on several covers of Der Spiegel magazine dating back to the 1960s that depict robots taking over jobs and leaving humans powerless to stop them. Yes, there will continue to be many changes resulting from digitalization, but not necessarily with this outcome, MP Vogel argues. He is confident that people are creative and will adapt to the new technologies of the future. As a country that introduced many inventions since the first industrial revolution, Germany has to take initiative and do just as well during the ongoing industrial revolution of digitalization, promoting the creation of new jobs and companies.

One solution that MP Vogel proposes to the challenge of digitalization is continuous education. The share of workers in Germany participating in education and further training programs is too low. More than two thirds of the population is not involved in further training or education on a continuous basis. In Germany, many people have the expectation that after completing a degree, it is no longer as important to continue learning. MP Vogel wants to enable more people to enroll in schools and universities to continue their training and promote lifelong education. Although rural areas in Germany, like in the U.S., are also highly industrialized, many companies in these areas have difficulty in recruiting skilled employees.

While Germans are aware of climate change and the severity of the crisis, the focus has often been on symbolic actions, rather than on implementing solutions. At the beginning of 2020, Germany received news that the CO2 emissions for the year 2019 were much lower than was expected. This implies that the market-based emissions trading tool used for reducing CO2 emissions has been working well. This approach is not yet being used with transportation and housing, but may be in the future. If Germany has the goal to decarbonize the economy by the middle of the century, then it makes sense to continue using the market-based emissions trading tool.

When developing domestic policies to handle the interrelated challenges of demographic change, digitalization, and climate change, Germany must become much more ambitious. MP Vogel recommends that Germany build a modern immigration system on the model of the systems in Canada and New Zealand in order to promote skilled workforce development. Along with these policies, Germany needs to reform the pension system and to reform the education system in order to encourage lifelong education. These approaches will help to prepare Germany to handle the challenges of the future.