Kaput

Wolfgang Munchau, formerly of the Financial Times and founder of Eurointelligence, argues that the German economic model has ended and that its collapse was structural rather than the result of the energy shock that exposed it. His subtitle names the end of the German miracle, and the book is a demolition of the assumptions on which German policy rested.

His account of the model has three legs: cheap Russian energy, Chinese demand for German capital goods and cars, and American security guarantees that let Germany avoid defence spending. He argues that all three ended at once, and that German policymakers and business leaders spent two decades making the dependencies deeper while telling themselves they were diversifying. The industrial chapters cover the failure of German firms to establish positions in software and semiconductors, the diesel emissions fraud at Volkswagen, the Wirecard collapse and the regulatory failure behind it, and the automotive industry's late and unconvincing response to electrification.

Munchau writes as a polemicist and states his conclusions more strongly than the evidence in any single chapter supports. He gives limited credit to German strengths in specialised machinery and chemicals, and he treats the Mittelstand's engineering focus as a weakness without engaging the argument that it remains a genuine advantage. The account of Wirecard and of German financial supervision is the best-documented part. Read it as a forceful statement of the pessimistic case rather than as a balanced assessment.