Thread by @DanielaGabor

if your macro narrative is 'well done Germany, your balanced budgets have created the fiscal space you need now to deal with geopolitical challenges posed by Russia' - your austerity ideology is blinding you to the obvious

https://twitter.com/DanielaGabor/status/1496812922647031808

my bet - European Commission will embrace this narrative next week and double down on its Carbon Contracts for Difference strategy of derisking private investments in decarbonisation, ignoring the painful lessons from Germany's Energiewende

have spent this week in class discussing a 2009 Lin vs Chang debate on industrial policy that goes at the core of the decarbonisation debate - what do we mean when we discuss the revival of industrial policy?

onlinelibrary.wiley.com/doi/10.1111/j.…

the Lin state - a facilitating state that corrects market failures - is in its new incarnation the derisking state that tinkers with price signals but doesn't PICK winners.

It is also exactly the state, and industrial policy, guiding German Greens in green ordoliberalism vision

until Wednesday, I thought political magic of green ordoliberalism is ultimately a question of macroeconomic doctrine - it crafts decarbonisation viable within the macrofinancial status quo

Putin just made the gaping holes in that argument visible to anyone