Advice on Corona and Budget 2020

Economist Rudolf Hickel on state aid: "Not whether you save, but how"

[This interview published on July 12, 2020 is translated from the German on the Internet, https://taz.de/Oekonom-Rudolf-Hickel-ueber-Staatshilfen/!5694435/.]


1.2 trillion euros have been earmarked by the federal government for the rescue of the economy. The economist Rudolf Hickel wants to make companies take responsibility.
A woman holds up a sign

Almost every*r would like to be saved. Companies are reluctant to make concessions for this

taz: Mr. Hickel, at the moment there are huge federal economic aids. Is the big nationalization coming?

Rudolf Hickel: That's what neoconservative and neoliberal forces always like to claim. But that is great nonsense. I would rather say that in many useful measures an opportunity has been missed: The transformational transformation of strategically important companies, which are now being rescued with capital investments from the Economic Stabilization Fund, to also strengthen them in terms of employment and ecology.

Politics has forced the companies into lockdown. Isn't it fair that they are now saving the economy?

The Corona crisis has forced us into the economic downturn. It was a reaction to the danger of a pandemic spreading. The many measures described as a lockdown had to put the economy practically in a coma. Companies that got into the crisis through no fault of their own now need help.

So money from the state.

Absolutely. Corona aid, that's 1.2 trillion euros in the first premium, is an incredible program consisting of very different instruments. There are grants and loans for the small ones. These are completely correct, necessary aid, for companies and solo self-employed people who hardly have enough capital and would therefore crash immediately through no fault of their own as a result of the Corona crisis. Then we have small and medium-sized enterprises, which can apply for up to EUR 150 000. The loans and guarantees are quite right.

And for the big players?

They benefit from the economic stimulus package, such as the reduction in VAT. But that helps all the companies affected. You can't derive claims on an individual from this. But the state is also rescuing certain large companies directly, with money from the Economic Stabilization Fund. I also think this rescue of the large systemically important ones is important, but the conditions are very controversial.

78, economic expert from Bremen, where he helped to set up the university in the early 1970s. He is a member of the scientific advisory board of Attac.

Explain!

Take Lufthansa. Saving it with nine billion is absolutely right. Without mismanagement, the company is in danger of going down. We're talking about 140,000 employees. With its logistics services and cargo operations, Lufthansa is systemically relevant. So the question is not whether to save, but how.

And how do you rescue properly?

One way is to provide assistance for a short time, then the state will immediately withdraw again. Or the state can participate directly and thus also have corporate responsibility. The federal government has chosen a middle course.

What does it look like?

Nine billion euros will be raised for Lufthansa. 5.7 billion of that is a silent partnership contribution. Silent means: give capital, shut up. The state is heavily involved, but has no influence. There is a loan of three billion from the KfW. That leaves 300 million of the nine billion: with this amount, the state becomes a direct shareholder. The Federal Republic will become a shareholder with 20.05 percent of Lufthansa's share capital. I have demanded that it be at least 25 per cent plus one vote so that the blocking minority is achieved. So the Federal Government can instead say: When it comes to strategy definition, we are out.

Did the money come with no strings attached?

Conditions have already been imposed. First: the state gets two supervisory board seats. The question remains: will critical minds go there or will only posts be allocated? Second condition: no dividend payment during the rescue. The bonuses of the members of the board of directors will not be cancelled as requested, but only reduced. That is already the end of the story. Once again: the blocking minority would have been important.

What could the federal government have done with it?

It could have used it to fight for a new corporate strategy on the supervisory board. The state could pursue transformation policies. Two points would be important: On the one hand, we could have included ecological goals in Lufthansa's strategy, such as reducing domestic flights or a requirement to reduce CO2 emissions. This has been done at Air France.

What is the second point?

A guarantee of employment should have been included. It is scandalous that 9 billion is now being spent and at the same time there are massive job losses. There are plans to cut about 40 000 jobs out of the current 140 000. Bremen is also affected, especially the staff at the airport's counter service. Most of them are women.

But can you demand that companies that you are saving from the abyss be transformed?

Yes. After all, the taxpayer has to help finance it. If we are rescuing, if we are consolidating losses in order to privatize profits again later, then we must expand co-determination. The counter argument is that the government is prescribing in its general environmental policy how internal flights should develop. But with lobbying everything will be done to prevent such a law. In this respect, it is much better if the goal is implanted in the companies.

What is the situation at TUI and others? Will the state be smarter in saving them?

At TUI we don't know yet how it will turn out, they don't want any involvement. After all, Lufthansa did not want the state's influence. Now the compromise that is pleasant for them is: Yes, state, wash my fur, but don't get me wet.

Why are the companies so afraid? Airbus would rather shrink than accept help.

At Airbus, it's a bit difficult with the state money, as an international consortium. Unlike Lufthansa, the entrepreneurial arguments for job cuts are highly problematic. In general, the big corporations in need will try to get a silent participation from the fund with its 200 billion euros. Companies want the silent financier, i.e. no politicization.

Is it at all possible to enforce more in the future, now that Lufthansa has got off so cheaply?

At least you always have to bring it in. That also works on the ground: If the state promotes the establishment of new businesses, then conditions must be set, and a company will only receive a subsidy for land development if it guarantees a minimum level of employment for a certain period of time. In Bremen, this was previously written into the contracts, but the conditions were often not met. Now it is no longer written into the contracts.








What does "civil society" actually mean in liberal democracies today?
May 11, 2020
by Christine Resch

[This article published on May 11, 2020 is translated from the German on the Internet, http://wp.links-netz.de/?p=440.]


With the turn of 1989, the term "civil society" experienced a new boom and reinterpretation. Civil society, that was the "peaceful revolution" in the GDR, which prevailed against a dictatorial regime. This use was far removed from Antonio Gramsci's analytical concept of the "società civile", understood as part of the "integrative state", which describes "hegemony, armored with coercion" as a form of government in liberal democracies. Since 1989ff in the academic debate, civil society has meant "the good guys". There are many examples of this: be it the urban intelligentsia against the "brown swamp" in the countryside; be it the culture of welcome in the "summer of migration" 2015; be it, in the current "corona crisis", the many hard-working people who, with self-sewn masks, supply aid organizations (free of charge - they deserve our recognition) and the population (preferably for appropriate payment). The latter is done so that especially "the risk groups" do not get infected while shopping, despite a safe distance and by observing other hygiene regulations. The right to consumption - for ten days now, after all, new T-shirts for the home office have been allowed to be bought - trumps the right to education and political meetings. Even visiting churches, synagogues and mosques as a central part of exercising religious freedom was ranked behind the possibility of re-entering the cathedral department store. Harvest workers from Romania apparently endanger the locals - and in view of the "new nationalism" they are at stake - less than a humane accommodation for fugitives. With strawberries and asparagus the world is going to end up noble after all. It is up to each nation to be concerned about the state of health of its population. There is no cross-border responsibility and even the two-class medicine in "normal times" seems to be forgotten, which often makes me doubt whether health really has the highest priority from the prevailing political viewpoint.

But one thing at a time:

with the fall of the Berlin Wall, the term "civil society" took on the meaning of "civic engagement". One can hardly deny this equation "neutrality" - commitment to what or against what remains completely open at first: The "civil society" simply does something and is increasingly called upon to do so! Gerhard Schröder then elevated the activation of civil society to a political program. (cf. exemplary: https://www.tagesspiegel.de/politik/gerhard-schroeder-sorgt-sich-ums-gemeinwohl/131206.html) The state should promote civil society - and demand it, of course. It is a mischief who thinks badly when the activation of civil society is explicitly made a task of the state and a matter for the boss.

And civil society does the right thing in case of doubt! It fights (no, it delimits itself) - see above - against the "brown mob"; it acts in a humanitarian way; it compensates "state tasks". If the state fails, the civil society should and will judge it. "Civil society" after the fall of the Berlin Wall has exactly this "taste". It is the scientific accompaniment to more "personal responsibility" (individual and collective), which the neo-liberal competitive state and increasingly authoritarian state is forcing again. As a keyword in the election campaign, however, the then chancellor Schröder then renounced this word. According to the results of a survey, the population simply did not understand it. They only associated it with a contrast to "military". Civic engagement sounds more attractive. "Civil society" remained a scientific term that only entered politics via the detour of "engagement" and in the meaning that was scientifically promoted in Germany after 1989.

Since the refugee policy crisis, this attitude has become more acute. Merkel's "We can do it" may have been initially addressed to the EU states, but in effect it was a call for (Christian or humanitarian) voluntary work. It became our obligation, which we - i.e. the liberal civil society - gladly accepted. The fact that neither the state nor the local authorities had sufficient resources available to be able to carry out meaningful voluntary work is an open question. Sure, it was a good opportunity to clear out wardrobes and children's rooms of things that had been discarded anyway and to donate them generously. Although this only compensated superficially for the care that would have been necessary for the refugees, the volunteers were celebrated for their commitment. Often the helpers were the only contact persons for the refugees, but they rarely had sufficient knowledge to give advice. The complicated dealings with the Federal German administration, clarification in legal questions, etc. would have required professional support.

Even during the current corona contact restrictions, the empiricism is - as is so often the case - on the street and increasingly on the screens: Media (namely ARD and related third channels) have been broadcasting for weeks under "#zusammenhalten". Class and gender relations play no role in "big times". In my hallway you can find offers - voluntary and unpaid - that provide shopping assistance for "risk groups". "Stay at home" signs can be found on dormitories. Rainbow pictures at daycare centers and apartments are meant to create optimism. Thanks for sewing masks are never ending in the news (cutting instructions are always available!). (High)schools rely on the commitment of teachers and lecturers (and parents, keyword: homeschooling) to make digital teaching possible - more work for all. Even my energy supplier thanks me by email for social distancing (and swears by further supply). The civil society is appropriated. As during the refugee policy crisis in 2015, the implementation of the prevailing policy becomes a civil society task. Political and civil society must form a close alliance in this difficult situation; only together can the "fight" against the virus succeed. In both cases, this has the nice effect that public infrastructure is hardly ever talked about. Rather, it is a matter of personal responsibility and commitment, or rather the responsible adaptation of measures. The neoliberal era, which was prepared by the Kohl government and then pushed through by the Schröder government, is experiencing a paternalistic break in the Merkel government. While some may have had doubts in recent decades about the relative autonomy of the state (vis-à-vis powerful capital factions), we are currently experiencing a situation in which the government has the last word. Paternalism - let it be based on insight or devotion. In any case, there have been no democratic discussions about possible strategies to deal with the pandemic. To this day, no one knows exactly what the virus is, but governments decide what must reasonably be done about it.

In the rich industrialised nations, the issue of health was well prepared for access to civil society. This was increasingly handed over to those affected. Virtuous terror against smoking and obesity were the key words. In the current pandemic, the need for everyone to participate in the health of everyone conceals the fact that the health system has been commercialized and privatized in recent decades. The decisive criteria for this were hardly that the best possible care for the population should be guaranteed. Although the consequences of such a health policy were scandalized in Italy, for example, the conditions here were hardly ever an issue in the media - satirical programs are the exception, such as Die Anstalt in its program on 24.03.2020. We would rather celebrate now those working in hospitals for the fact that it has been possible to increase the number of (fortunately empty) intensive care beds, and companies that manufacture respirators instead of their usual products. Whether this will also result in nurses* getting better pay in the future is currently no more than a vague hope and demand. In any case, part of the danger that Corona poses is entirely self-inflicted. Hardly any lessons have been learned from the past epidemics, protective clothing for medical staff is still hardly available in sufficient quantities.

But back to "civil society". Over the last few decades, "health" has become a symbol of condensation. In the area of "social security", this works in the same way as "violence", which legitimizes measures of "internal security". No one knows exactly what is meant by this - the terms are useless. With "violence", everything from schoolyard brawls to criminality to the war in Syria is attributed one and the same word. With health, the spectrum ranges from daily climbing the stairs and sufficient intake of vitamins and fibre, while sugar, fat and salt have to be reduced, to medical check-ups and additional private health insurance, which we should all take out if possible. "Health insurance" should no longer be called that. Health is the ultima ratio, everything is subordinated to its protection. In the Corona crisis this attitude no longer had to be established. It was enough to recall it. Taking health risks in order to maintain economic, political and social life or to suspend basic rights without further ado hardly required any debate and was not associated with any major conflicts. The fact that health is regarded as the highest good has obviously made us lazy in our thinking. All in all, the "wording" was and is truly skillful: besides health, it is solidarity and responsibility that we are urged to take to heart. Who is supposed to object to that? We never tire of thanking all those who are still there for us: salesmen and bus drivers, doctors and nurses. The only problem is that it was as little their decision as it was that of those whom we are unfortunately not allowed to see now, whose services we are unfortunately temporarily not allowed to use.

In everyday life, the hour of the moralists and block keepers, who meticulously monitor whether we comply with the hygiene regulations and who are not afraid to call the police if a group of youths comes too close to each other, strikes anyway. Indeed, fines are imposed for administrative offenses, but how often this happens could not be found in a quick search. This is a policy of hegemony armored with coercion. However, it seems to me that there is little need to enforce the measures through penalties. The population voluntarily exercises obedience. This does not mean that there are any possible motives to participate. It can be a gesture of submission, it can be based on the consideration that refusing to do so would be too costly and unpromising, it can also be an insight into the rational approach of the Federal Government.

Although I am trying to make a point here, I would at least like to mention that this is not a one-dimensional process. One exception is the ban on assembly: The demonstration of "Seebrücke" in Frankfurt was disbanded by the police, although the activists kept the safety distance and wore mouthguards. This situation also gives rise to ideas: for example, "window demos" or leaving colorful footprints or shoes in public places, which are passed by individuals every minute, as in an action in Berlin. One of the tried and tested strategies for resistant action is to take the prevailing "announcements" at their word. In this context the initiative #leavenoonebehind is interesting, which demands health protection for all and the dissolution of refugee camps. What "Unterschleif" everyday life offers would still have to be explored.

One more little observation I want to mention: In order to generate a message it is enough for the Chancellor to show her annoyance in view of the recently inflamed debate about possible loosening of the contact ban. There is no need to argue with an appropriated civil society, expressions of emotion are quite sufficient. The fact that this was also an affront to the National Academy of Sciences (Leopoldina), which had preferred to relax quickly, need not be discussed at all. Although the Leopoldina primarily advises the government (with special consideration of the capital perspective), it was in competition with other experts* during the Corona crisis and was at a disadvantage compared to the virologists and institutes, which had already achieved their public reputation at that time through the support of politics and the media. The public attention that the Leopoldina received was probably unwelcome to this academy, which had previously operated rather in the background. It was also at a disadvantage. The post-Corona phase will show what can be learned from this about the relationship between politics and capital (fractions). What is indicated at the moment does not exactly make you feel confident. I can't read "signs on the wall", but I don't want to overlook the authoritarian style of politics either. Conflicts such as the one with Lufthansa or the one over the next "scrappage scheme" will soon show how the relationship between politics and capital is (re)balanced.

The new insight? Probably none! For Russia, Gramsci was able to show that it was precisely an untrained civil society that made a successful revolution possible. Under conditions of democracy, civil society has become so assimilated that it does not act in a resistive manner, but rather supports the ruling politics. But Gramsci already knew that a hundred years ago. This also happens when politics appears in authoritarian garb. Coercion can leave such an option in the ambush if the population voluntarily participates in a courteous and responsible manner. This is the hour of the organic intellectuals of the political class, who occasionally have to defend their terrain against the thinkers* more committed to capital. That an openly authoritarian state is more favorable for emancipatory politics, however, cannot be concluded from this. Rather, it seems to me to be the case at present that conflicts are contained by civil society. Emancipatory politics is characterized by the fact that interests are negotiated. This requires, however, the ability of different interest positions to deal with conflicts. With appeals to all of us to take responsibility, these are leveled out from the outset. The need for a balance only emerged as a motive in the public debate when decisions were made to relax the contact ban.

This may be an exacerbation of the situation. The contradictions are interesting. Let's look for them... Or, to put it another way, in the old-fashioned way: where are the organic intellectuals of the working class?




Why we spare ourselves a contribution to the Corona crisis

by Joachim Hirsch, Eva-Maria Krampe, Christine Resch and Jens Wissel

[This article published on 4/14/2020 is translated from the German on the Internet, http://wp.links-netz.de/?p=432.]


With regard to health risks, the type and speed of propagation, protective and countermeasures, and the possible effects of the disease, a continuous, polyphonic, albeit somewhat monotonous, chorus has been resounding for weeks, supported by governments, the media and even networks, left and right, liberal and green. Especially left-wing protagonists* are praying diligently for what has already been said everywhere. In the so-called social networks all this is multiplied in no time at all and the digital space is used for the spreading of conspiracy theories. We prefer to do without the usual speculations based on completely unsecured data and leave them to the virological experts, who, although constantly contradicting each other, have nevertheless become political topic givers and guides to action. So let us stop panicking.

What the mainstreamed chorus still largely ignores are the economic and political consequences of the crisis, namely the long-term consequences as opposed to the short-term aid efforts. All the signs indicate that global capitalism was facing a serious crisis, the open outbreak of which could only be postponed with difficulty, for example by the flood of money from the central banks. The pandemic has now revealed this crisis with full force. The emergency measures introduced by governments to at least mitigate the recession carry the great risk of leading to a further and even sharper sovereign debt and financial crisis than we experienced in 2008/09. One should not indulge in conspiracy theories. However, the virus has made possible what wars - a metaphor often used by some statesmen - have otherwise achieved: large-scale destruction of capital and a profound shift in the balance of power in society. These are the preconditions for the remaining capital to become profitable again. There should be no doubt as to who is ultimately responsible for the actual costs of these operations.

And the political consequences are equally profound. In the pandemic, it is the hour of the strong men who have entered a race for ever more restrictions on fundamental rights. And accordingly, the course towards an authoritarian security and surveillance state is accelerated enormously. The fact that the essence of fundamental rights must not be touched even by the legislator is hardly relevant any more. Nor does it matter that the principle of proportionality applies to restrictions of fundamental rights. The authoritarian exceptional state comes by government decree. And all this with broad approval and almost unrestricted obedience from the population. The votes of individuals who draw attention to this problem can currently still be counted on one hand. This shows the weakness of the foundations on which liberal democratic relations stand, and not only in this country. It would be rather naïve to believe that all this would be reversed when the crisis ends. Never let a good crisis go unused!

Everyone is saying that the right-wing populists would not have profited from the crisis, or only to a small extent. This is a fallacy. Although the hour belongs to the governments who proclaim the crisis and the supposed measures to cope with it, and although the AfD is currently rather preoccupied with itself, much of what it demands is now a reality: an authoritarian state, closed borders, defense against everything "foreign" and a "national community" that no longer knows any parties.

The society will be different after the crisis and probably not a better one. Even though there are now numerous voices pointing to the great opportunities that could result from this unique challenge: Social solidarity instead of a neo-liberal struggle of all against all, the return of health care to a state task, all the way to a deprivatized and tax-financed health care system. Demands for better payment for care work seem to be generally accepted. It cannot be completely ruled out that the experiences of the current crisis, which have also exposed the ailing state of the social infrastructure and the costs of austerity, will be progressively processed. However, our Minister of Health is more concerned with measures for total surveillance of the population, which has long been intended and is now suddenly within reach. The corona app, the latest achievement in this field, is an excellent tool for this purpose and it would be a mistake to believe that this technique would be mothballed in the post-epidemic period. It would be high time to think about this and what to do about it. This applies not least to scientists* who call themselves critical.




Budget 2020: Steps to overcome the Corona crisis

by George Feigl, Jana Schultheiss, and Tobias Schweitzer

[This article published on May 7, 2020 is translated from the German on the Internet, https://awblog.at/budget-2020-schritte-zur-ueberwindung-der-corona-krise/.]


The first budget draft of the black-green federal government is overshadowed by the CoViD 19 crisis. The health and economic crisis inevitably causes a decline in prosperity and a deterioration of the public budget balance. The central goal of budget policy must now be a fair distribution of the burden of the crisis. Our budget analysis shows the urgency of an employment and investment program to rapidly reduce unemployment. At the same time, the focus must be on medium-term challenges such as securing and expanding the welfare state and ecological sustainability.

Prosperity-oriented budget policy - especially in times of crisis

Prosperity orientation remains our compass in the assessment of economic and budgetary policy. Since the presentation of the draft budget 2020, the volume of measures to combat the current crisis has been increased from 4 to at least 38 billion euros. This rapid improvement was sensible in order to stabilize the health system and incomes and to safeguard production capacities during the lockdown.

Much more problematic than the decline in production and income in general is the strong concentration of income losses on some social groups, such as in particular the unemployed and small self-employed or pupils from educationally disadvantaged households and young adults on the verge of entering employment. Budgetary policy must now set the course so that, in parallel with the withdrawal of the lockdown, economic and employment policy measures are taken to mitigate the negative consequences of the economic slump in the medium and longer term and to prevent social distortions - for example by increasing unemployment benefits and emergency unemployment assistance to a net replacement rate of 70%.

Budget 2020, budget policy, AK Budget Analysis, unemployment in Austria, Corona crisis

The most important goal of budget policy must be to reduce unemployment in 2021 at least to the level of 2019. An early recovery of the labor market would also improve the budget situation again - although a rapid return to a budget surplus is not a reasonable goal, also in view of other social challenges. The current crisis should be the starting point for a social-ecological transformation geared to the prosperity of the broad mass of the population.

Boosting investment - expanding the welfare state

A public investment program is therefore now required to complement the budgetary measures already taken. It should include the improvement and expansion of the capacities of the health and nursing care system as well as climate protection. A special federal investment program of 700 million euros, focusing on climate protection measures, is to be launched especially for municipalities whose possibilities for revenue generation and debt raising are limited. In addition, special write-offs, eco-promotions and public risk equity are to stimulate private investment in the future.

Budget 2020, what is missing; AK Budget Analysis, Employment and Investment Programs

An important lesson of the CoViD 19 crisis is already the essential importance of the welfare state. The focus must now be on the rapid expansion of public social services. There is a particular need in the areas of health, labor market and social policy, care, kindergartens and crèches, and education. A particular focus must be placed on gender relations in order to counteract a re-traditionalization of gender roles - for example, due to a lack of childcare facilities, incompatibility of home office and home schooling. In the long term, a labor market policy oriented towards equality will play an important role. At the same time, the CoViD 19 crisis offers the opportunity to discuss wage increases in some poorly paid, predominantly women-dominated sectors anew.
Do not lose sight of medium-term structural reforms on the expenditure side

Despite the dominance of the CoViD 19 crisis, medium and longer-term goals must not be forgotten. For example, in labor market policy, responding to current challenges in the short term is indeed the top priority. To this end, short-time work must continue to be financed and a slippage with a reduction in working hours must be considered. In addition, active labor market policy must not be forgotten now or in the future. Additional funds are urgently needed for targeted employment programs for disadvantaged groups, such as Chance 45 for older unemployed people, the qualification allowance and additional staff (+500) for the AMS. Equally more funds are needed for inter-company training, because youth unemployment will rise while the supply of apprenticeship places, which was already too low before the crisis, will continue to decline.

In the field of climate policy, sustainable alternatives to CO2-intensive production and consumption methods must be pursued. Public services are of central importance, above all making rail transport more attractive. Economic activities of the public and private sectors must be made sustainable without losing sight of the effectiveness of the measures. Above all, climate measures with a high employment impact announced in the government programs - e.g. expansion of the railways, renewable energy generation, district heating and cooling pipelines and cycle paths, as well as thermal renovation - should now be implemented or brought forward rapidly.

The goal of halving poverty in Austria, as set out in the intergovernmental agreement, has gained further importance as a result of the CoViD 19 crisis. In order to actively combat existing poverty, an expansion of cash and non-cash benefits is necessary. The "Corona Family Hardness Fund" should be expanded into a general social emergency fund and supplemented by an increase in the equalization supplement, a "basic child benefit" and a poverty-proof minimum benefit. In addition, better kindergarten facilities, priorities for a more socially permeable education system, investments in social housing and more offers in psycho-social care and social work are necessary.

The current crisis is a powerful reminder of the importance of a functioning health care system. Now it is time to learn the right lessons so that the ability to act is also ensured in the future: for example, more staff, sufficient capacities and available support materials. At the same time, health insurance is facing merger and harmonization costs due to the merger of the health insurance funds and loss of contributions. This makes it necessary for the Confederation to provide a deficiency liability for health insurance until 2022 at any rate, as the SHI institutions would otherwise be obliged to make reductions or deductibles.

After years of announcements, a sustainable concept for the care system is finally needed. The focus must be on making the services on offer and the working conditions more attractive: 20 percent more staff in the nursing homes, more training places already this year, improvement of mobile services with abolition of the deductibles, expansion of psycho-social counseling for relatives. In addition, active labour market policy must not be forgotten now or in the future. Additional funds are urgently needed for targeted employment programmes for disadvantaged groups, such as Chance 45 for older unemployed people, the qualification allowance and additional staff (+500) for the AMS. Equally more funds are needed for inter-company training, because youth unemployment will rise while the supply of apprenticeship places, which was already too low before the crisis, will continue to decline.

In the field of climate policy, sustainable alternatives to CO2-intensive production and consumption methods must be pursued. Public services are of central importance, above all making rail transport more attractive. Economic activities of the public and private sectors must be made sustainable without losing sight of the effectiveness of the measures. Above all, climate measures with a high employment impact announced in the government programme - e.g. expansion of the railways, renewable energy generation, district heating and cooling pipelines and cycle paths, as well as thermal renovation - should now be implemented or brought forward rapidly.

The goal of halving poverty in Austria, as set out in the intergovernmental agreement, has gained further importance as a result of the CoViD 19 crisis. In order to actively combat existing poverty, an expansion of cash and non-cash benefits is necessary. The "Corona Family Hardness Fund" should be expanded into a general social emergency fund a complemented by an increase in the equalization supplement, a "basic child benefit" and a poverty-proof minimum benefit. In addition, better kindergarten facilities, priorities for a more socially permeable education system, investments in social housing and more offers in psycho-social care and social work are necessary.

The current crisis is a powerful reminder of the importance of a functioning health care system. Now it is time to learn the right lessons so that the ability to act is also ensured in the future: for example, more staff, sufficient capacities and available support materials. At the same time, health insurance is facing merger and harmonization costs due to the merger of the health insurance funds and loss of contributions. This makes it necessary for the Confederation to provide a deficiency liability for health insurance until 2022 at any rate, as the SHI institutions would otherwise be obliged to make reductions or deductibles.

After years of announcements, a sustainable concept for the care system is finally needed. The focus must be on making the services on offer and the working conditions more attractive: 20 percent more staff in the nursing homes, more training places already this year, improvement of mobile services with abolition of the deductibles, expansion of psycho-social counseling for relatives. The additional budgetary costs of around 600 million euros can be financed with an inheritance and gift tax.
Fair financing - debts are bearable

The high costs of the corona crisis and countermeasures require financing. However, the foreseeable record deterioration in the budget balance and the recent sharp increase in the public debt ratio are manageable given an interest rate close to zero.

By contrast, the reduction in the tax ratio envisaged in the government agreement is unthinkable in budgetary terms for the next few years and is not a sensible goal in economic terms, because it threatens to make dangerous cuts in the state's health, social and education expenditure in terms of distribution and economic policy. One important lesson of the CoViD 19 crisis, however, is that a welfare state that is also financially strong and capable of action is an important prerequisite for coping well with external shocks and not burdening the weakest members of society with the burden of the crisis. In the current situation, the tax incentives planned by the German government for the top 100,000 - above all the undifferentiated reduction of the corporate tax rate - would be unacceptable.

Rather, there is reason to balance the burden by means of the tax system. This requires higher and progressive levies on large assets and high inheritances and incomes as well as the political necessity to finally adopt a tough stance against the extraordinarily harmful tax evasion, even into European tax swamps.

European answers are needed

However, financing of the measures and investments primarily at national level is insufficient. From the point of view of health and economic policy, it is extremely dangerous if the individual EU member states have varying degrees of leeway for countermeasures.

Further stabilization, financing and investment opportunities at EU level are necessary to ensure that the health and economic crisis does not turn into a financial and euro crisis. Proposals such as the EU Recovery Fund currently under discussion are to be welcomed in principle and are also economically reasonable for both the EU and Austria.

Finally, the negotiations at EU level on the medium-term financial framework up to 2027 must be used for a stronger social-ecological orientation and support for upward convergence between the Member States instead of defending a short-sighted "net contributor" position.