When short-sighted patronage politics and anti-market populism complement each other, German politics hit rock bottom. That’s right, it’s about the fuel price discount. The FDP made the serve. With sufficient approval from the SPD and a grudging yes from the Greens, Christian Lindner pushed through a flat-rate tax cut for three months, which amounts to around 35 cents per liter for petrol.
The effect is clear – if you want to take note of it. In Austria, for example, before the discount started on June 1, premium petrol was a good 30 cents cheaper than in Germany; now the prices are almost the same at two euros. Because in Austria, like everywhere else in the world, prices have risen sharply in the past few weeks.
The reason is simple: refinery capacity is scarce worldwide, and the refineries are making good money. In terms of price, petrol and diesel have decoupled from oil by a large margin. Just as the wood prices are very high, although the raw material – in this case – is even cheap: The sawmills are overloaded and at times earn a lot of money – that is to be accepted in a market economy.
Supply and demand can only be balanced again with appropriate investment incentives. Whether every cent discount is passed through in Germany can rightly be doubted. But the tank discount is overwhelmingly popular.
He was just short-sighted and wrong to begin with. Financed with three billion euros in tax money, a summer flash in the pan of cheaper prices is paid dearly. The incentive to save fuel decreases, the climate balance worsens on top of that. Most annoying: It has been proven that wealthy households benefit disproportionately.
The next act of the tragedy is even more depressing. Lacking any convincing evidence, it is widely believed that the oil industry miraculously formed an effective price cartel in Germany just in time for the introduction of the rebate.
“The mineral oil companies are reaping the profits, the consumers don’t notice the tax cut,” says Green Economics Minister Robert Habeck. This only serves to serve outrage instincts. Yet few politicians disagree.
The fairy tales are garnished with actionism by the evil rip-off corporations. According to Habeck, the rather toothless antitrust law is now to be tightened. That in and of itself isn’t a bad idea. The proposal to be able to skim off unlawful profits in the event of proven violations is reasonable.
Of course, it’s clear to everyone: That doesn’t change anything at the current fuel price high. The uncomfortably expensive faucet is a global phenomenon – in which Putin has played his cruel part.
The federal government should explain the situation and think more about targeted social compensation, including for gas and electricity. Instead, she ignites a flash in the pan, which is now supplemented by false attributions and illusions of feasibility.
A shocking spectacle that will cause a lot of damage, materially, but also to the political culture in Germany. It hurts and worries that, of all people, the self-proclaimed coalition of newcomers is performing this play.