Michael Vassiliadis, head of the IG BCE trade union, on the transformation of industry, threats to prosperity and a woman at the head of the DGB.
Mr. Vassiliadis, which election winner do you expect at the IG-BCE congress at the end of October in Hanover?
Let’s see. Armin Laschet and Olaf Scholz have already announced..
And Annalena Baerbock?
. has not yet accepted.
You have been a member of the SPD for 40 years; how do you explain the party’s resurgence in recent months?
The SPD has rightly rallied behind its top candidate and benefits from his profile: Olaf Scholz stands for experience, solidity, appropriateness. Many people appreciate that. At the same time, the other candidates have made maximum effort to strengthen Scholz’s footprint as an experienced politician.
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Can he still lose?
We won’t know until election day, because the large proportion of undecideds will only decide then.
After the election, things really get going. They see the German model of prosperity in danger in this decade of transformation. What is so dangerous?
Our model is based on an export-strong industry – in the past 25 years even more than in the decades before. We live on the fact that the world buys our products. Because far more sectors and jobs in this country are dependent on the value added by industry than is generally assumed. Just look at the huge area of industry-related services. We are now reaching a point where industrial transformation is picking up speed and, at the same time, trade policy conflicts, for example concerning China, are flaring up.
What follows from this?
In the analysis of what lies ahead – concerning climate protection, for example – we are now largely in agreement. It is now a matter of doing what it takes to successfully transform the economy and society in the direction of climate neutrality. Given the magnitude of the task, we can’t waste any more time. And we have to make sure that this is done in a socially just way. All this will be extremely demanding, expensive and risky. If we mess up the transformation, the entire model of prosperity is in question.
To make things fair, climate money is to be distributed: What comes in via CO2 pricing goes out again for citizens.
That will not be enough. Society has been diverging for a long time, and we need to debate much more fundamentally what we mean by justice and how we get there. How is the tax system set up? How does the distribution policy work? Do we want to resign ourselves to a divided labor market and millions of precarious workers??
For these employees, the SPD and the Greens are calling for the minimum wage to be raised to twelve euros, while the Left Party is calling for it to be raised to 13 euros.
If we take climate protection seriously and the price effects are felt in gasoline and food, for example, the minimum wage will hardly be enough to make the financial burden bearable for people. More needs to happen here besides more good collectively agreed wages. The discussion on this does not yet go deep enough. In politics, if you set big goals for big problems, you can’t make yourself small when it comes to the policy tools and financing to shape the future.
The political leadership is overwhelmed?
Leadership means defining goals, measures and priorities and bringing these policies to fruition in discussion with civil society, business, trade unions and environmental associations. There’s a lot more that can be done, because the gaps between campaign rhetoric and reality are huge. Take the green-ruled state of Baden-Wurttemberg: there, coal-fired power plants are running at full speed because they are building wind farms at a snail’s pace and there are no transmission lines to get them there. By now, everyone should have realized that we will need huge amounts of green electricity and an affordable hydrogen economy to transform our production processes. How politicians intend to achieve this in the short time available will be the key question for the next government.
Hydrogen only for industry or also for transport?
In terms of mobility, we’ll be driving on electricity for the next 20 years – what comes after that is open to debate. In the energy-intensive industries, however, there is often a huge demand for energy in one place, where hydrogen can be used quite efficiently. There are chemical sites that alone account for more than one percent of Germany’s total electricity consumption. Or take the steel industry: I have just visited an iron ore mine in Sweden that is being converted to renewables. They’re asking outright: Why should we actually transport the ore to Salzgitter or Duisburg? Wouldn’t it be much more energy efficient if the smelters came to us?
What do you mean?
We will get a change in the international division of labor and new value and supply chains. Eventually it will all be very, very expensive. Our location must equip itself for this. We need prioritization: what do we defossilize, when, and how? Chemicals, paper, steel, cement – the list is long. Moderating this decision-making process would be a task for the next chancellor or chancelloress.
The next government should determine which industries we will have in ten years’ time?
Of course not. I would like to see us all in Europe. It’s not about planned economy either, it’s about a broad and technically sound discussion process, which so far takes place too little. And for reliable framework conditions for public and private investments in certain technology fields.
120 billion for the transformation
They would like to have a transformation fund filled with 120 billion euros of taxpayers’ money. What is to happen with it?
For example, launching hydrogen projects that are far from economically viable today. Or a charging station infrastructure. Basically, the investment has to come from the companies, but the fund can get involved and get things off the ground. So public money is only available if investments are supported here in Germany. You have to go through the different investment fields and industries. We need a kind of mega PPP, i.e., a public-private partnership on an unprecedented scale.
Let’s ever get off the high electricity prices that industry and especially small and medium-sized businesses are suffering from?
For a long time, there was an underdeveloped awareness of the problem of high energy prices in politics. This is also due to the fact that the Greens in particular wanted to achieve energy savings by making prices more expensive. That was one of the goals of the first red-green government. This is completely out of hand. Many companies today move only slightly above the waterline. If the price continues to rise now, they will drown. For them, it’s not about transformation and innovation at all, but primarily about managing these costs. Things cannot go on like this.
Due to the huge demand, electricity in general is likely to become even more expensive.
We used to have an oversupply of energy. That’s over. We will be phasing out nuclear energy in a year’s time. By 2030, around 60 percent of coal-fired power generation will have been eliminated – something that some people like to ignore in the election campaign. Things are getting tight on the supply side. At the same time, the sharpest structural change of all is to succeed.
"Unions can manage crisis"
How well are the industrial unions prepared for change?
In the IG BCE, we have experience with far-reaching changes – for example, with the end of the coal industry or now with the phase-out of lignite. In both cases, we have ensured that the transformation has been and will be managed without compulsory redundancies and with new job opportunities. We trade unions are doing a good job in crisis management, most recently in the pandemic. We can. But we also have to look ahead more, formulate our vision for the decade of transformation.
Do you have a vision?
Linking innovations with good, quality work and co-determination as transformation drivers. We also need to make greater use of digitization. The ecological transformation inevitably leads to greater politicization of the economy – and that is precisely our specialty. To achieve this, we need cooperation and alliances with environmental associations and other relevant groups in civil society, because in the end it’s always about social issues as well. For education and participation, health and pensions. At the same time, unions need to become more efficient, faster, more digital.
Even the umbrella organization DGB?
The individual unions need to revisit the question of what competencies we need in the umbrella organization so that it can speak and connect – as a social actor that forges alliances. On the one hand, there is the increasing specialization in occupations and thus also in the individual unions, and on the other hand, there are the broad issues in the global economy. Both can be combined well with a strong DGB, which the DGB member unions must want.
More on the topic
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You are the longest-serving president of a DGB trade union, which is why you are currently looking for a successor to DGB head Reiner Hoffmann, who is retiring in May. Is there a chair for the first time?
Experience, authority, and an understanding of transformation in its entirety are important – whether it is a woman or a man.