MisterG

In a parallel universe, Germany would be leading the Intelligence Revolution. This is a country of engineers and physicists, one that rebuilt itself after the Second World War on its supreme industrial and manufacturing capability. It was the best in the world at building complicated machines. That’s what ‘Made in Germany’ stood for. But policy choices have consequences. And there have been monumentally short-sighted ones. The catastrophic one for Germany is its energy policy, the ‘Energiewende’ — or, more specifically, the decision to ‘go green’ by relying on cheap Russian gas whilst completely shuttering its world-leading, clean and safe nuclear capabilities. German industry can no longer compete globally. The national grid has come dangerously close to complete collapse during a ‘Dunkelflaute’, when wind and solar generation fall short of electricity demand. And Germany is still burning the dirtiest of all fossil fuels: coal. That’s what happens when a slogan becomes policy without any strategic foresight. Germany now has some of the highest industrial energy prices in the world, and its manufacturing and engineering excellence is being cannibalised by China. Germany once grew rich by selling autos to China — but the company that leads the world in EV market share today is China’s BYD. China also leads on robotics, and has the most sophisticated industrial base in the world, with output far exceeding that of Germany, the United States and Japan combined. German industry simply cannot compete on electricity prices — already four to five times those in the U.S. or China. Nor can Germany meet the growing demand for compute without the electricity to power it. Energy-rich countries are rich countries. And this will become ever more evident in an epoch where we convert electricity to Intelligence. America leads — for now — on both frontier capability and AI compute. But American political leaders would do well to consider the policy choices that have left Germany and other European countries facing a very harsh reality. Economic might, leadership and innovation are not God-given rights: they require capital, talent and the right policy frameworks. American leaders: don’t make the same mistakes. After all, we can see the consequences playing out in real-time.