From July 12 to 14, 2024, Munich hosted the seminar “Fundamentals of Alternative Economic Policy,” organized by the AfD-affiliated Desiderius Erasmus Foundation (DES). The event aimed to impart theoretical foundations and stimulate thought regarding economic policy approaches favored by Germany’s libertarian-right faction. Jurij Kofner, an economist at the MIWI Institute and spokesperson for the AfD Bavaria’s Finance and Taxation Committee, actively participated in the seminar.
Private Property as a Fundamental Right
The seminar commenced with a lecture by a member of the Bavarian Constitutional Court, who expounded on the constitutional foundations of the Social Market Economy within the German Basic Law. Particular emphasis was placed on Articles 14 and 15, concerning property rights. The speaker highlighted the median wealth of Germans, a mere 61,500 euros, as one of the lowest among OECD countries, along with a homeownership rate of just 46.5 percent.
Regulatory State vs. Welfare State
Kofner posed a question regarding the constitutional theoretical dispute between Böckenförde, who emphasizes fundamental rights as defenses against state interference and advocates for a non-interventionist regulatory state, and Forsthoff and Smend, who support an interventionist welfare state to uphold human dignity. Kofner was interested in the influence of these schools of thought on the interpretation of property rights, the extent of social benefits, asylum law, and the so-called “climate protection.”
Fundamentals of the Social Market Economy
A significant highlight was a lecture by Prof. Dr. Fritz Söllner from the TU Ilmenau, who elucidated the fundamentals of the Social Market Economy. Söllner discussed the differences and similarities between the three main schools of thought: the Austrian School, the Chicago School, and the Freiburg School (Ordoliberalism). He advocated for a return to the ordoliberalism of Walter Eucken and less social policy interventionism akin to Müller-Armack. Kofner inquired about the role of large corporations and collective identities such as family, nation, culture, church, and nation within these schools of thought. Söllner underscored Wilhelm Röpke as a critic of large corporations and a proponent of collective identities.
Germany’s External Economic Dependence
A DES board member delivered a lecture on Germany’s external economic dependence and the free market access. Hausberger provided a historical economic introduction and underscored the importance of the European single market for the German economy. He addressed the issue of Germany’s liability for EU debt and the uncovered claims in the TARGET balances. As a solution, he proposed a reform of the EU to return competencies to the national level and gradually replace German net transfers with direct investments in Southern European countries, thereby avoiding a hard Dexit and external political influence.
Swiss Financial Constitution as a Model
Prof. Dr. Fritz Söllner explored whether the Swiss financial constitution could serve as a model for Germany. He contrasted the German cooperative federalism with the Swiss competitive federalism, highlighting the advantages of the latter, such as lower taxes and higher efficiency.
| 2022 | Germany | Switzerland |
|---|---|---|
| State Quota (in % of GDP) | 48.5% | 32.2% |
| Tax Quota (in % of GDP) | 24.4% | 21.3% |
| Levy Quota (in % of GDP) | 41.9% | 27.2% |
| Social Quota (in % of GDP) | 30.5% | 17% |
| Average Taxation of Wages | 47.8% | 23.4% |
Money, Gold, and Freedom
Peter Boehringer, budgetary spokesperson of the AfD faction in the German Bundestag, emphasized in the closing lecture that a stable monetary and pricing system is the foundation for growth, prosperity, and freedom, criticizing the fiat money system based on theories by Mises, Rothbard, and Baader. Boehringer argued that a growing economy does not require a growing money supply and supported currency competition according to Hayek, which would lead to the dominance of gold-backed money. He announced that the AfD would likely adopt a positive stance toward cryptocurrencies in its program.
In the ensuing Q&A session, Jurij Kofner raised concerns about the fractional reserve banking system and the interest on TARGET claims. Boehringer responded that the fractional reserve system is worse than fiat money and that the Bundesbank is highly indebted, with an operational loss of 21 billion euros in 2023. He noted that interest on TARGET claims (3.75 percent of 1.047 billion euros) and gold reserves were the only assets keeping the Bundesbank afloat.
Embracing More Market Economy
The seminar concluded with a clear message: embrace more competition and federalism, promote wealth-building policies that prioritize private ownership among the general populace, and establish a stable and transparent monetary system as the foundation for prosperity and economic growth. The event provided participants with valuable insights and stimuli for shaping an alternative economic policy in Germany.
