The conflict between Russia and Ukraine has had an impact on the whole world, and Europe has been particularly affected. With the breakdown of relations between Russia and the EU , the EU has lost its most important blessing-cheap energy.
There are a large number of developed countries in Europe. They all started with the industrial revolution . After taking the lead in industrialization, they began to plunder the world and completed primitive accumulation.
European countries are highly dependent on industry, and the development of industry is inseparable from fuel. However, due to geographical limitations, energy is extremely scarce and requires large amounts of imports to meet demand. Therefore, Europe's economy is directly related to energy costs. If it can obtain cheap energy, it will be able to obtain more profits, and only then will it have enough funds to engage in research and development, maintain its leadership in technology, and thus enter a virtuous cycle.
This is why even during the Cold War, Europe still insisted on energy cooperation with the Soviet Union.
However, after the outbreak of the Russia-Ukraine conflict, this virtuous cycle was completely shattered. European countries could no longer obtain cheap energy and were replaced by high-priced energy from the United States, which caused heavy damage to the European industrial sector.
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As the most economically developed country in the EU, Germany is heavily dependent on foreign energy and has been hardest hit. According to the speculation of Monica Schnitzel, head of the German Economic Advisory Council, the inflation rate will remain high for a long time to come and will be a problem until 2024. In other words, the current high inflation situation will take another two years before there is any significant relief.
Many Europeans believe that as long as they survive this winter, everything will be over, but in fact, the hard times have just begun. Europe's energy gap this year is not particularly large. The main reason is that energy costs are too high, which affects the economy.
By next winter, the energy gap will be larger than this year, which will inevitably cause energy prices to rise further, which will inflict a heavier blow to the economy.
"Made in Germany"
Germany's current response is to protect enterprises, provide some subsidies, and tacitly allow enterprises to pass on costs to consumers, ensuring that all profitability will not be greatly affected.
Only by preserving the enterprise can the country's economy be preserved. In this process, the Germans became victims. Most of the increased costs due to the energy crisis were paid by the German people.
However, this is not a long-term solution, because it goes against the laws of the market and can only be a stop-gap measure. The choice made under special circumstances is the lesser of two evils. Since
is a stop-gap measure, it means that it may not be able to save the German economy. This abnormal model can only maintain the operation of enterprises and let the people pay for it in the long term. The consumer market will be affected, and the products of local companies will gradually lose their competitiveness. After all, not every country is in an economic and energy crisis, and people do not have to buy goods produced by local companies. Therefore, the method of passing on costs will not last long. The problem must be solved fundamentally, otherwise Germany will not be able to escape the fate of and de-industrialization of .
The natural gas cooperation between the EU and Russia has been hindered by the war.
In fact, not only Germany, but the entire Europe is facing the tragic situation of deindustrialization. High energy prices have left European companies breathless, and capitalists are bound to want to leave for the sake of profit. After all, there are still many countries that have not been affected by the energy crisis, and they can produce in countries with lower production costs.
This principle is very simple, but European politicians do not understand it. They insist on pursuing the United States to sanction Russian energy, and they are even more ruthless than the United States.
The United States is an energy-producing country and is not worried about the energy crisis. European countries are short of energy, but they still have to impose heavy sanctions on Russia. It still has not stopped even though it has caused serious consequences. It is shocking.
A country's government always makes decisions with a purpose, but European countries' decisions are purely self-punishing, which is puzzling. If you remain stubborn, you will eventually dig your own grave and ruin your country.