Friday, January 12, 2018

Twenty-Eight Pages

The new coalition draft is a total of 28 pages....maybe a quarter of what a typical German government formation would be in draft form.  That will be obvious to people, and make them wonder how long this government will last.

So today, the chief topics of the 28 pages came out:

Taxes:  no new taxes.  Yeah that was a shocker.  Both sides (CDU and SPD) agreed to the end of the Solidarity Tax (it said in writing when started in the 1990s, that it would end in 2019).  So they kept their word, it will actually end. I expect this no new tax scripted talk to last only through 2018, and be a major problem in 2019 and 2020. 

Refugee policy: an odd decision.  They came to a compromise which says that every month....up to 1,000 family members of immigrants in Germany....may bring their relatives here.  So, a max of 12,000 a year.  As for the general incoming number?  They agreed to a range of 180,000 to 220,000 per year.  Then they agreed that in the future....all asylum will be carried out in a central reception facility (yet to be described), and this facility would have decision-making ability and return facilities built into it.  To me, it sounds like a magnet for pro-asylum folks to protest and make for problems.  It was also agreed that only food and residence would be provided at this point, with NO cash benefits.

Health insurance.  A new joint financing plan will be built for statutory health insurance.  This means that it'll be equal....what you and your boss pays...equal amounts. Presently it was set to 14.6 percent for the boss, and you had roughly 15.6 percent.

Pension reform will occur.  The present program will continue til 2025, then start to modify.  A commission will form up to discuss this major change.  A new special pension will come to exist for low-income wage earners...meaning some type of government funding will funnel in and help to raise their standard of living.  This is a miserable part of German society today and a lot of these people are on welfare because there's simply not enough to survive.  Eight-thousand new nursing or helper posts will be created to handle situations in nursing homes around Germany.  This will come out of the German federal pot of money.

Employment:  Long-term unemployed folks will get more attention and helped with retraining to get them into the market.  Longer periods to pay the unemployment benefits?  That was NOT agreed upon.  Some agreement came over social security contributions. 

Farming: The herbicide glyphosate will be slowly edged out of the market.  The goal is to end the one says the timing of this. 

If you look at the limited nature of the twenty-eight pages...if approved by each general party, then I would suggest a somewhat quiet 2018 period with these goals laid out and most likely accomplished by spring of 2019.  Then?  Well....without any real structure, my guess is that 2019 (EU election coming up) will become a hectic year....full of drama....and lots of political chit-chat. 

This is designed to just get folks over the 'hump' and viewing the mess as settled, and then after some quiet period.....launch into full political 'charming'. 

My general prediction is that the two state elections in 2018 (Hessen and Bavaria) will see both the CDU and SPD losing a fair number of votes over what they had in 2013.  The other parties will see numbers improve, and signal that the public is disenchanted with politics of the two central political parties.

The same likely occurs in 2019 with the EU election...thus shocking a few political analysts and the news media. 

All in all....there's a limited amount of talk you can get out of twenty-eight pages and a sign of no real agreement between the two groups. 

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