The Econoclasts Q&A: Germany’s economic death trap & the truth about BRICS
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Dec 24, 2025 Yanis Varoufakis and Wolfgang Munchau dive into Germany's economic stagnation, highlighting outdated growth models and the need for ambitious transformation. They discuss the implications of far-right parties aligning with Putin and explore how Europe can revitalize its economy through migration. A bold peace plan for Ukraine is proposed, alongside a call for stronger European defense cooperation. The duo assesses BRICS as a serious contender in the global landscape and debates whether AI will disrupt traditional wage labor by creating new job dynamics.
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Germany's Outdated Growth Model
- Germany's growth model rested on 20th-century engineering strengths but failed to invest in 21st-century digital and biotech technologies.
- Wolfgang Munchau argues this structural misalignment, not mere austerity fixes, explains Germany's stagnation.
Prioritize National Ambition Over Austerity
- Rethink national ambition and role in the world before tinkering with taxes or austerity.
- Be more ambitious as a society and stop relying on external macroeconomic patrons like the US.
Abandon 'Biblical' Debt Morality
- Drop 'biblical economics' that treats debt as sin and surpluses as virtue.
- Yanis Varoufakis warns this moralising stance on debt is catastrophic for Germany and Europe.