“Conspiracy and unauthorized state aid”, the Irish low-cost airline Ryanair to the loan commitment by the Federal government for Air Berlin. But the dispute about what is allowed and what is not, is much older than Air Berlin.
150 million Euro for three months – the German government wants to protect the flight operations of the ailing Air Berlin first. Competitor Ryanair has railed against it: “These artificially created insolvency is obviously to be drafted, so that Lufthansa can take over a debt-free, Air Berlin, and this contradicts all the rules of competition of Germany and the EU.”
The competition rules of the EU, blades-first of all, simply and clearly: “the state or through state resources in any aid granted,” it says in the EU regulations as of April 2014, “by favouring certain undertakings or the production of branches threaten to distort competition or threaten to distort competition, [are] incompatible with the internal market.”
Thousands Of Pages Of Exceptions
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As far as the simple beginning statement. But then, a contract follows the factory with a volume of 1008 pages, and a long series of exceptions allowed. It managers and politicians invoke in Italy, as in Ireland, in France as in Germany. The list of government intervention in the economy to promote businesses or entire sectors of the economy, is long and old. Since it comes to car factories, steel works, wind power, construction companies and the banks.
We take any year in the economic life of Europe: in 2012, the individual States, the EU awarded a total of 62 billion Euro to all sorts of aid. The funds for banks were not included in the calculation. The aid for the financial industry, however, are particularly expensive. Even if one assumes that large crises such as the may require from the 2008 high, medium, 480 billion euros, but a lot of money. So a lot of the time, consisted of a rescue package for the banks. This should be prevented, that the crisis-ridden banks could encounter the entire economies of the EU in the crisis.
“Peanuts” for the airline industry
But this year, money is flowing at a height in the financial sector, the amount of 150 million for the German Air Berlin as the proverbial Peanuts look. So, the Italian government pumped in June to 17 billion euros in only two banks. The supported Veneto Banca and Banca Popolare. the Vicenza is not even of national importance for Italy; its balance sheet total does not two percent of the total industry in Italy For the North of Italy, but and for the local customers, an uncontrolled collapse of the two was too great a risk, so the arguments from Rome.
The case shows that also the Mantra of the Bank bailout “too big to fail”, is sometimes varied. Bank houses, so the classic Argument, how about the even more radiant, Deutsche Bank, were simply too large to be without risks for all the economies in existential crises left alone. So it’s no wonder that last year there were rumors that the largest German Bank could access to state resources. Nothing came of it then. Unlike years ago when the second largest Bank in the country, and the Commerzbank.
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Air Berlin: Three questions to Jens Flottau
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Air Berlin: Three questions to Jens Flottau
In the Winter of 2008, the state-supported Commerzbank with € 18 billion. “The help of the state always intervenes in the competition. Therefore, they should remain, if possible.” The simple statement made at the beginning of 2009, the Bonn, a Professor of law Daniel Zimmer, then a member of the National monopoly Commission. And, therefore, not be justified in the financial sector, in spite of his special position. Finally, the state interference in the business policy of the company directly. A short time later flowed to Commerzbank for a further five billion.
In the meantime, the Bank has paid back the government funding, and has survived, slipping but from a reconstruction phase to the next. In another spectacular case of state aid in Germany, the Patient did not survive. The construction company Holzmann was in 1999, in heavy water. The then-Chancellor Schröder rushed to help and brought a state guarantee. Two year later, Holzmann went Bankrupt. Schroeder saved Holzmann, but evil tongues coined the phrase, “Holzmann saves Schröder”. Thanks to the efforts of the construction workers, the SPD’s Chancellor increased his approval rating in the electorate at the time.
State aid for companies: travellers as an Argument
Jobs and passengers
One of schröder’s predecessors, the SPD Chancellor Helmut Schmidt, knew years earlier, a similar case with the words to dismiss: “We are not, however, the repair operation of capitalism.” It was the tradition of the group AEG, the creditor lost the equivalent of more than two billion euros because there was no state aid. The Argument, however, the politicians who are trying in such cases, as in the case of Holzmann always the same: jobs. Even then, when shareholders and creditors of the affected companies are better.
In the current case, the Federal elections in Germany soon – it’s the politicians who are in favour of the state help, however, to the special customers of the ailing Air Berlin: the traveller. Matthias Machnig, state Secretary in the Federal Ministry of economic Affairs, said that he thought the bridging loan from the Federal government for the insolvent Airline for allowed, because the tens of thousands of Air Berlin customers are in the main travel time on the road. There would have been no capacity to bring in the short term home. Distressed travelers safe voters are hardly.
To the question of state funding for Air Berlin had already drawn in mid-June, the current head of the German monopoly Commission’s position: “If a company is poorly managed or the business model is wrong, then the state should not get it artificially alive,” said Achim Wambach to the newspaper “The world”. The monopolies Commission is a body of experts that advises the Federal government in matters of competition policy. Binding, their recommendations are not.