this post was submitted on 27 Nov 2022
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The article you linked is mostly about France and French protectionists policies about trying to save their mostly irrelevant car industry in a shrinking market where other nations like the US and Germany are pumping subsidies into their local companies. This has very little to do with Russian gas, and frankly speaking there are way too many car companies anyways so a correction of the market is long overdue.
I would suggest you start posting more about Canada, because you quite clearly have no idea what is going on in Europe right now.
I would suggest that you either address the actual points being made. This has everything to do with Russian gas. And anybody with a shred of intellectual integrity understands that an industrial nation like Germany needs access to cheap energy in order for its industry to function. You keep dancing around the elephant in the room here bud. And if you genuinely don't understand this then you're the one who has no idea regarding what's going on in Europe right now.
Please read the article again. You clearly did not understand what it is about. Sure, lack of cheap gas is one of many factors causing economic problems right now, but this is neither what the article you linked is about, nor is it the main issue.
You seem to have some sort of strange obsession with German/EU industry being totally dependant on Russian gas, which is mostly a right-wing talking point and the part that is indeed impacted by rising energy prices is exactly the part that has been sleeping on global developments and needs to urgently innovate regardless of availability of Russian gas or not.
Please read the article again. You clearly did not understand what it is about.
The article says that the US is using the energy crisis in Europe to entice industry to move from Europe to US by providing subsidies while also having cheaper energy access.
You keep dismissing basic fact that 60% of the energy Europe was getting from Russia has no readily available replacement as a "right-wing talking point". Calling it that doesn't change the fact that it's a correct point. Germany, is the industrial hub of Europe, and that's precisely why it's most affected by the incredible energy prices resulting from Europe being cut off from cheap energy.
You can't urgently innovate your way out of this problem. Any alternative infrastructure will literally take years to build, and will require massive amounts of energy to do so. It's frankly embarrassing that you can't understand this.
edit: also, stop pretending this is exclusively right wing talking point, unless you're claiming Die Linke is right wing https://www.peoplesworld.org/article/die-linke-lawmaker-russia-sanctions-causing-social-and-economic-catastrophe-in-germany/
The only people who refuse to accept this talking point are the war hawks who want this war to last as long as possible, which is the camp you're evidently in.
Again you blatantly fail to understand EU politics, this is just a roundabout way of how the French complain about Germany unilaterally subsidizing their industry and buying fighter jets from the US instead from France.
There is currently a global economic down-turn caused by many factors, one more minor being the stop of cheap energy exports from Russia to central Europe. But the much larger factor is the ongoing impact of the global pandemic and especially the economic issues in China caused by that. In this negative economic environment, companies that have unsustainable and outdated business models are going to fail, and that is what this entire fuss is about. This is a long overdue market correction that is IMHO good and will result in a stronger economy in Europe in the medium term.
And yes, I stand by my point that this is a right-wing talking point and "Die Linke" has been recently fishing for right-wing votes as everyone in Germany knows. You show your total lack of understanding of European politics again ;)
P.S.: I am against the war in Ukraine and hope it will end as soon as possible. But even without the war in Ukraine this problem of unsustainable and outdated business models would have come up sooner or later and I am glad that it is highly unlikely that cheap gas imports will resume if/when the war in Ukraine ends.
Again, you blatantly misrepresent what's happening which is that EU countries are now realizing that US is creating subsidies which makes it hard for European industries to compete. Both France and Germany are scrambling to come up with some kind of a response.
The amount of dishonesty it takes to claim that the stop of cheap energy from Russia i a minor factor is frankly astronomical. Meanwhile, the whole global economic downturn is largely rooted in the economic war between the west and Russia.
I'm assuming that you're calling industry and manufacturing outdated business models here. The entire fuss is about the fact that lack of cheap energy means that costs of production in Europe are far higher than places like China or even US. Since we live in a global economy, European companies are directly competing against companies in other countries that have access to cheap energy. I hope that clears things up for you.
Again, the point is entirely correct regardless of how you choose to smear it. Industry closing down leads to unemployment and reduced spending. Capitalist economy traditionally goes into a crisis of overproduction when that happens. No reason to expect anything different to happen this time around.
You're right, capitalist economic model is outdated and unsustainable. These problems have been building for many decades, and your political class deferred addressing them into the future by playing games like doing QE. The pandemic and the economic war are acting as a catalyst that's forcing all the accumulated contradictions to the surface. Hand waving over the current problems by saying that it's all for the greater good in the future is not useful for dealing with the crisis.
"My" political class? Now you are doing the ad-hominem and it is quite ridiculous as you are the one claiming the lack of alternatives to the status quo. Oh and what is it? A "crisis of over-production" and a "break down of industry due to lack of cheap energy inputs" can not be true the same time, even in outdated Marxist economic models.
I meant the political class of your country. And of course these things can be true at the same time. Once again, companies are global and they already do plenty of manufacturing outside of Europe right now. The collapse of the consumer market in Europe is hurting these companies. Rising energy prices in Europe are precisely what's driving this. Also, adorable that you think Marxist economic models are outdated. Presumably, you think that producing things like food, energy, housing, infrastructure and other things that people need are outmoded concepts. 😂
So please explain where the over-production is when there are less producers and less demand (due to rising prices). Marx, with his 19th century economic models would have done a better job explaining that then you do.
Producing "things like food, energy, housing, infrastructure" in a global economy requires a slightly better understanding of the economic circumstances than the right-wing talking points that you repeat here without thinking about them yourself even for 5 minutes it seems.
I'm not sure what you're struggling with here specifically. Europe is the primary market for European companies regardless of where they do production. As the economy crashes, people have to allocate larger portions of their income towards necessities. This means they have less discretionary spending. This leads to companies losing revenue because they can't sell all the goods they're producing. So, companies end up leaving European market and anybody working for these companies loses their jobs.
Meanwhile, goods that people need end up needing to be imported from other countries, and with European currency falling that means cost of imports is going up.
I hope that helps clear things up for you there.
So far you haven't addressed any of the point I've made here and simply repeat the mantra that these are right-wing talking points. It's as if you don't actually have any answers to these problems. Europe is going into a recession and this is already making life very difficult for people. This will only get worse going forward. If it's only the right that's discussing these issues openly then Europe will slide back into fascism.
That is not what Marxists mean with "crisis of over-production". Did you ever read Marxist economic theory?
And you are also trying to change the subject now (as usual when you are losing an argument). Yes there is a global economic down-turn and Europe is also effected by that, as are many other regions. Various factors play a role in that, the global pandemic (and counter-measures especially in China), tightening of monetary over-supply & and inflationary pressures, economic sanctions against China and Russia, etc.... lack of Russian gas supplies to central Europe also play a role in that, but a relatively minor one.
But I am repeating my argument here, which you just refuse to address while continuing with right-wing fear-mongering of rising energy prices spelling the doom of all European industry, which is laughably untrue and just done to fish for votes of people in denial of the larger economic issues at play.
Ideas have to be adapted to their current circumstances instead of applied dogmatically. I understand why this concept is hard for an anarchist to understand though. Crisis of overproduction fundamentally means that companies are producing more commodities than the market can absorb. This is clearly starting to be the case for European companies.
Nowhere am I changing the subject, which is that high energy prices are causing deindustrialization of Europe and that's feeding into the economic crisis that Europe is experiencing. The fact that energy prices have jumped by an order of magnitude is not a minor factor, and I know that even you can't be ignorant enough to think that.
You haven't actually made any argument here. You just said that there are other factors in play, which nobody debates. What's laughably untrue is you claiming that European industry isn't shutting down in face of energy costs. Critical things like steel mills and phenomenal 70% of fertilizer production has halted as a result. You're either blatantly lying or have no clue how European economy works. It's often hard to tell which it is when talking to you.
As a European living in Europe I probably have a slightly better understanding of European politics and economic issues than a Canadian apparently getting their main source of European news from right-wing tabloids.
Prices spiking for fertilizers etc. were mainly a result of speculative bubbles (most notably in the UK, which relies on their own natural gas sources in Scottland and does AFAIK not import any gas from Russia) and continental Europe has long had a crisis of agricultural over-production with cheap fertilizers destroying the environment. (And on a side note: the current agricultural issues are not due to lack of fertilizer, but rather extreme climate change induced drough in large parts of Europe).
And old European steel mills (mostly running on coal btw.) had long issues with competition from cheaper / energy subsidizing producers like China, this is nothing new and the rising energy prices just accelerate a long overdue market adjustment. With falling population and demand for products containing steel (like large cars) this is also not really an issue as the little steel that is still needed can be easily imported.
There are some sectors like the chemical industry that do have a high dependency on natural gas, but they are not such a significant part of the EU economy and will in the medium term benefit from an accelerated transition to bio-technological processes over 19th century energy intensive ones that were artificially kept alive due to cheap energy imports.
You wouldnt stand for this bullshit logic if the subject were Canada. If that's the length you want to go to prove energy doesn't matter for industry then maybe such sophistry is all you have.
Straw-man argument. I never claimed "energy doesn’t matter for industry".
And contrary to some other people here I don't claim to know everything about Canadian industrial problems and also don't constantly post tabloid articles about it. I would actually be interested in non-tabloid articles being posted about Canadian issues as I know very little about that.
You said it plays a minor role which is bullshit. Tell me how can the Euro economy/industry can make adjustments if it lacks cheap energy that is available elsewhere?
I said compared to the other current global economic issues the lack of cheap energy supplies for a very selected part (comprising mostly of outmoded industry) of companies in central Europe is relatively minor. And that is undeniably true, look at any economic indicator and you will see that the EU as a whole is not doing uniquely bad right now.
This is why I laugh when you assert being European as a point because Europeans make great American dogs. Not doing uniquely bad? What kind of neoliberal nightmarish bullshit is this? How much kool-aid can you stomach? As if Europe is better off without the cheaper energy that makes it more competitive with the US.
That is a deeply ignorant statement. Energy is required for literally every aspect of modern life. It's needed for transportation, heating, manufacturing, agriculture, and every other aspect of a modern economy. Being cut off from cheap energy creates a situation where costs of doing any of those things become prohibitive.
It's also hilarious that you think things like manufacturing are outdated. I guess people don't need houses to live in anymore or things like rail infrastructure to get around.
I guess going back to medieval times is the anarchist dream. Wonder how many people in Europe share it.
Yet somehow all these things are still being done in Europe right now, with ships full of energy sitting just outside of the harbours because gas storage is full and the price is too low to sell it profitably.
Most of these things don't need "lots of cheap" energy anyways, they do perfectly fine with regularly priced energy which is sufficiently available for those things that are really needed and not just driving excessive profits for a few major capitalists.
But true enough, without lots of cheap energy, suppressing labour costs and manipulating your currency downwards, you can't massively out-compete everyone else, which is what Germany is famous for and which only one country has recently surpassed them in, namely China.
You do realize how ridiculous your entire argument sounds coming from someone claiming to be a communist?
These ships full of energy are sitting there because there aren't enough terminals to unload them. Meanwhile, the gas storage that's full is meant to supplement pipeline flow as opposed to replace it. Once again, I have to wonder whether you don't know these things, being the Europe expert that you are, or you're just intentionally misrepresenting things to fit your narrative.
[citation needed]
An interesting non sequitur to use there. I was discussing energy costs while you casually threw in labour suppression. I never expect any intellectual honesty from you, but wow.
I do realize that the straw man you're fighting is indeed ridiculous, it has little to do with the actual argument I'm making. Maybe try engaging the actual argument being made instead of clowning around and throwing cheap insults.
Gotcha, there is no energy crisis in Europe and magical solutions will provide all the energy that's needed going forward. Thanks for educating me on this complex subject.