10th Munich Economic Summit

19-20 May 2011, Munich

“Europe at a Crossroads: The Role of the State in a Globalised World”

With more than 200 participants from the economic, political, and academic sectors, the 10th anniversary Munich Economic Summit registered new record participation. This was not only due to the appeal of speakers such as Sweden’s Minister for Finance Anders Borg and Germany’s Minister of Labor and Social Affairs Ursula von der Leyen, but also to the Summit theme of the role of the state in society and the economy – a highly topical issue in times of high public debts.

Professor Hans-Werner Sinn and Jürgen Chrobog, the two conference hosts, started out by raising two demands: to consolidate public finances at a time when growth rates are rising again (Sinn), while not neglecting the state’s core task of guaranteeing social services and benefits (Chrobog). Citing Sweden as an example – a country that has undergone radical reforms and now can be seen as a “Nordic model for success” – the Swedish minister for finance, Anders Borg, described what the right balance between state abstinence and state intervention may look like: Having dramatically reduced its public spending-to-GDP ratio, Sweden boasts of higher growth, lower unemployment rates and a lower budget deficit than the EU average.

As for the question of how to maintain a functioning social welfare system in light of the demographic changes, Federal Minister Ursula von der Leyen emphasized the necessity of creating better conditions for part-time and full-time employment in order to integrate women and older people into the labor market. At the same time, the citizens have to ask less of the state and assume more individual responsibility for their social security – a point noted by Kurt Biedenkopf, former minister-president of Saxony.

More market, less state: this creed, which was proposed repeatedly during the discussions, needs to go hand in hand with a broadening of the competition, especially when assessing the role of the state in the economy – while complying, from a neoliberal perspective, with firm rules valid for all, as BMW CEO Norbert Reithofer and Rainer Brüderle, head of the FDP parliamentary party, pointed out.

Even if Europe and its social market economy may have come out of the crisis better than others, it has to speedily tackle the major task of reforming its hitherto very successful economic and social systems in order to stay at the top globally.

You will find further information on the Munich Economic Summit Website.