The “Return”–Distribution Of Wealth In Germany – A Book Review
Ever since Karl Marx – in fact, with some knowing it even before Marx – capitalism had been distributing wealth unequally. Having established himself as one of Germany’s foremost experts on poverty, Christoph Butterwegge’s most recent book is about the redistribution as well as what he calls the return-distribution of wealth. His German language book is divided into three engaging and highly readable chapters asking the following questions, starting with “Why does socio-economic inequality exist?”. Followed by the second chapter asking, “Why is social inequality on the rise?” while the final chapter is asking “What to do and what will be successful?”.
After quoting Albert Einstein on there is enough money for all if it only were distributed equally (p. 7), Butterwegge notes that there is an upward redistribution of wealth from the poor to the rich. The not-so-socialist RAND corporation thinks that the shifting of wealth towards the rich amounts to about USD2.5 trillion – 2,500,000,000,000 – in the USA alone. In other words, capitalism remains inextricably linked to economic and social inequality. Correctly, Butterwegge argues that ‘inequality is neither natural nor God-given’ (p. 8). Instead, he sees three reasons for inequality in Germany (p. 8):
Faulty decision by Germany’s parliament and the government,
The de-regulation of the labour market,
The destruction of the welfare state and the deformation of the tax system.
As a good-hearted academic, Butterwegge thinks that decisions made by parliaments and governments can be ‘faulty’. However, this might not always be the case since many decisions are, as a matter of fact, made deliberately. It is by no means as Jesus once said, “father, forgive them, for they do not know what they are doing” (Luke 23:34). Most politicians know exactly what they are doing. Instead of insinuating their innocence, it might be more a case of “we have the best politician that money can buy”. In any case, Butterwegge is also correct when he emphasises that there is ‘no single cause’ (p. 9) for inequality.
It is more likely that Jean-Jacques Rousseau (p. 11) was correct when saying that the trouble started with the first man, having enclosed a piece of ground, bethought himself of saying, this is mine, and found people simple enough to believe him. To make people believe in the positives of private property, corporate media (Ali 2022) never grew tired to hammer just that. Yet, private property also has ‘negative consequences’ (p. 12). And of course, Adam Smith was correct in emphasising that the rich have an interest to ‘keep the established order’ (p. 14) so that all remains as it is.
Butterwegge also argues that the purpose of a ‘bourgeois government is to safeguard wealth against the poor’ (p. 14). In other words, ‘social inequality depends on the complicity of the state’ (p. 15; cf. Pistor 2019). One way to secure wealth against the poor is the idea of a welfare state (p. 16). The author notes, same condition that produces wealth also produces poverty (p. 17). Butterwegge also says that poverty cannot be eliminated within the conditions of an existing order. Such an order cannot even control the ever-increasing level of inequality (p. 17).
Subsequently, Butterwegge notes that if you like ‘to eliminate poverty, you need to eliminate wealth’ (p. 18). This might be so ever since capitalism has created economic inequality. This inequality, so the author says, is a necessary function of capitalism (p. 18). The function of a government “under” capitalism is also to secure the transferal of wealth from one generation to the next. In Germany, this applies mostly to the already wealthy. Butterwegge states that, ‘a large number of families inherit nothing’ (p. 25) outside of a standard bank account, personal belongings, household furniture … and a used car (p. 25).
Yet, there are some who can transfer stratospheric wealth in Germany – wealth that were simply stolen from Jewish families during Nazi-Aryanisation or what Butterwegge calls ‘brown inheritance’ (p. 25). These are Germany’s ‘Günther Quandt, Friedrich Flick, August Baron von Fink, Gustav Krupp von Bohlen und Halbach, and Ferdinand Porsche’ (p. 25) – all of whom enabled or colluded with Hitler’s Nazi regime and all got wealthy. Much of their wealth came from a ‘lucrative collaboration with the Nazi regime’ (p. 25).
Shortly after the liberation form Nazim, Germany’s post-Nazi propaganda sold it as Germany’s Economic Miracle (Alt & Schneider 1962) or Wirtschaftwunder (p. 25). West-German propaganda has even achieved the seemingly unachievable. It was made to appear as if on the ‘eve of June 20, 1948, all Germans started with the same wealth of 40 Reichsmark’ (p. 30) – the predecessor of Germany’s Deutsche Mark. Yet, in addition to owning factories, corporate bosses also received ‘60 Reichsmark per employee’ (p. 30). At the same time, ‘workers and civil servants often lost their entire bank savings’ (p. 30). In the subsequent years, ‘profits exploded while wages grew rather slowly contributing to inequality’ (p. 39). Yet, many Germans continued to believe in the media-induced hope of individual advancement.
Decades later, the rise of ‘neo-liberalism contributed to the production of inequality like nothing before’ (p. 43). Butterwegge argues that neo-liberalism is nothing but ‘the triumph of tax-inequality’ (p. 44). To keep workers in check, ‘globalisation, demographic change, and digitalisation became the new threats’ (p. 48). Despite the many high-sounding claims about the ‘death of neo-liberalism, neo-liberalism continues ‘to contribute decisively to the deepening gap between rich and poor’ (p. 49).
Furthermore, Butterwegge predicts that ‘the stagnating and possibly declining future population and the steady growth of Germany’s GDP should lead to an economic outcome that would be enough for all’ (p. 52). Set against this is the ideology that ‘everyone is responsible for their success or failure’ (p. 59). Yet, ‘nobody can really judge whether the performance of a manager and that of a sales-assistant or pre-school teacher should lead to a higher income’ (p. 63). In other words, ‘it is a myth to associate performance with wealth’ (p. 64). At least since Graeber (2018), we know that there are bullshit jobs – jobs that a society does not need.
Simultaneously, some very much needed jobs like cleaners, delivery drivers, recycling workers, etc. have been confined to a seemingly ever-increasing precariat (Standing 2011). These are workers pushed into Germany’s ‘low wage sector … that too, has led to a rise in poverty’ (p. 72). All of this is not natural as there is no natural law that says a society needs to have inequality. It is also not God-given for it is not God that gave us inequality. Instead, inequality is the result of a deliberate policy. In this case, it was the premeditated policy of social-democrat chancellor Gerhard Schröder – the Genosse der Bosse or comrade of the bosses, as he was known. At a Davos meeting on January 28, 2005, Schröder bombastically announced that he has created ‘the biggest low wage sector in Europe’ (p. 73). Behind Schröder’s low wage sector lurked ‘Hartz IV … a reform of Germany’s labour market and social welfare state’ (p. 74). All too often, the word “reform” serves as an ideological euphemism for pro-business re-regulation.
Worse, Germany’s much acclaimed ‘long-term care insurance [Pflegeversicherung] ended a decade- old policy of burden-sharing in which workers and employers shared the burden equally. With the Pflegeversicherung, costs were offloaded onto workers unilaterally – in short, corporate bosses escaped from their responsibility. Overall, it was just as the billionaire Warren Buffett once said (Stein 2006), there’s class warfare, all right, but it’s my class, the rich class, that’s making war, and we’re winning.
With the kind assistance of willing politicians, the upper class is indeed winning. Guided by the ideology of neo-liberalism, German tax policy favours the ‘Matthew Principle’ (p. 89), for whoever has will be given more, and they will have an abundance. Whoever does not have, even what they have will be taken from them. On this, Butterwegge also argues that despite Germany’s ‘constitutional obligation, established political parties have systematically supported the accumulation of wealth [Reichtumsförderung]’ (p. 90).
Meanwhile, the discovery of the infamous ‘Panama Papers outlining massive tax avoidance, letterbox companies, dubious trust funds, and offshore banking’ (p. 99) has not changed this. Instead, ‘the wealth of German billionaires grew by $95 billion between March 2019 and July 2020’ (p. 110). For example, the ‘two inventors of a COVID-19 vaccine, Ugur Sahin and Özlem Türeci, became billionaires very quickly’ (p. 110). Yet, ‘research for the vaccine was funded to the tune of €375 million [$404 million] by Germany’s ‘Ministry of Science’ (p. 111). Put simply, taxpayers’ money can assist in the creation of billionaires.
In parallel, corporations like ‘Amazon, Alphabet (Google), Apple, Facebook and Microsoft pay no or next to no taxes’ (p. 111). In ‘March 2020, shortly after the start of the COVID-19 pandemic, Germany’s state supported corporations l’ike Lufthansa, TUI, and Galeria Karstadt Kaufhof with €600 billion’ [$644bn] (p. 111). Simultaneously, Germany’s elderlies who depend on state support had to wait fourteen months until finally receiving a one-off payment of €150’ [$161] (p. 112) – another expression of the ‘Matthew Principle’.
Unsurprisingly, even Germany’s very own federal reserve [Bundesbank] had to admit that ‘inequality in Germany remains very high compared to other European countries’ (p. 117). Yet, with the onset of the Russian-Ukrainian war, many expect that ‘poverty and social inequality will only increase’ while Germany’s ‘Rüstungskonzerne or armament corporations will become even more profitable’ (p. 128).
In the final chapter, Butterwegge advocates for a kind of ‘return-distribution [Rückverteilung] of wealth’ (p. 131) arguing that in a more equal society, people will be happier. The author also says, ‘even though poverty is not an infectious disease, poor people are often treated like a leprous person’ (p. 133). At the same time, rising poverty can be seen in the fact that a whopping ‘22% of school children arrive at school with not having had breakfast’ (p. 134). Meanwhile, Germany’s ‘well over 1,000 food banks have to cover twice as much compared to a time when they were still known as soup kitchens’ (p. 153). Today, Germany also has different ‘food banks just for the homeless, clothing exchanges, special shops for the poor, and winter warm-up rooms’ (p. 153).
With that, the author returns to the above-mentioned ‘3Ds of the deregulation of the labour market, the destruction of the welfare state, and the deformation of Germany’s tax system’ (p. 173). Much of this is made possible through a strong ‘lobby of money’ (p. 185). Eventually, Butterwegge reaches the following – and rather unsurprising – conclusion to his book (p. 188; cf. Széll 2022; Artz 2024),
‘as long as the money-lobby defines Germany’s public opinion, political actors will not be game enough to eliminate inequality in Germany’.
Instead, what is likely to continue is the following: ‘the five richest Germans Albrecht/Heister, Böhringer, Kühne, Quandt/Klatten, and Schwarz will own €250bn [$268bn] that is more than half of what all poor people in Germany own’ (p. 189). As recently as March 2024, ‘the Council of Europe demanded from Germany to do more to eliminate mass poverty and the ever-increasing level of social inequality’ (p. 220).
Sadly, Butterwegge and this is despite calling his final chapter “What to do and what will be successful?”, the author offers very little on how to eliminate inequality. Still, his highly illuminating book carries two important lessons: for one, mass poverty and inequality are neither natural, nor God-given, nor caused by an individual simply making bad decisions as neo-liberalism and conservatives like to make us believe; secondly, there are three structural reasons for mass poverty and inequality. The author identifies them as “3Ds”:
The de-regulation of the labour market,
The destruction of the welfare state and the deformation of the tax system.
As a good-hearted academic, Butterwegge thinks that decisions made by parliaments and governments can be ‘faulty’. However, this might not always be the case since many decisions are, as a matter of fact, made deliberately. It is by no means as Jesus once said, “father, forgive them, for they do not know what they are doing” (Luke 23:34). Most politicians know exactly what they are doing. Instead of insinuating their innocence, it might be more a case of “we have the best politician that money can buy”. In any case, Butterwegge is also correct when he emphasises that there is ‘no single cause’ (p. 9) for inequality.
It is more likely that Jean-Jacques Rousseau (p. 11) was correct when saying that the trouble started with the first man, having enclosed a piece of ground, bethought himself of saying, this is mine, and found people simple enough to believe him. To make people believe in the positives of private property, corporate media (Ali 2022) never grew tired to hammer just that. Yet, private property also has ‘negative consequences’ (p. 12). And of course, Adam Smith was correct in emphasising that the rich have an interest to ‘keep the established order’ (p. 14) so that all remains as it is.
Butterwegge also argues that the purpose of a ‘bourgeois government is to safeguard wealth against the poor’ (p. 14). In other words, ‘social inequality depends on the complicity of the state’ (p. 15; cf. Pistor 2019). One way to secure wealth against the poor is the idea of a welfare state (p. 16). The author notes, same condition that produces wealth also produces poverty (p. 17). Butterwegge also says that poverty cannot be eliminated within the conditions of an existing order. Such an order cannot even control the ever-increasing level of inequality (p. 17).
Subsequently, Butterwegge notes that if you like ‘to eliminate poverty, you need to eliminate wealth’ (p. 18). This might be so ever since capitalism has created economic inequality. This inequality, so the author says, is a necessary function of capitalism (p. 18). The function of a government “under” capitalism is also to secure the transferal of wealth from one generation to the next. In Germany, this applies mostly to the already wealthy. Butterwegge states that, ‘a large number of families inherit nothing’ (p. 25) outside of a standard bank account, personal belongings, household furniture … and a used car (p. 25).
Yet, there are some who can transfer stratospheric wealth in Germany – wealth that were simply stolen from Jewish families during Nazi-Aryanisation or what Butterwegge calls ‘brown inheritance’ (p. 25). These are Germany’s ‘Günther Quandt, Friedrich Flick, August Baron von Fink, Gustav Krupp von Bohlen und Halbach, and Ferdinand Porsche’ (p. 25) – all of whom enabled or colluded with Hitler’s Nazi regime and all got wealthy. Much of their wealth came from a ‘lucrative collaboration with the Nazi regime’ (p. 25).
Shortly after the liberation form Nazim, Germany’s post-Nazi propaganda sold it as Germany’s Economic Miracle (Alt & Schneider 1962) or Wirtschaftwunder (p. 25). West-German propaganda has even achieved the seemingly unachievable. It was made to appear as if on the ‘eve of June 20, 1948, all Germans started with the same wealth of 40 Reichsmark’ (p. 30) – the predecessor of Germany’s Deutsche Mark. Yet, in addition to owning factories, corporate bosses also received ‘60 Reichsmark per employee’ (p. 30). At the same time, ‘workers and civil servants often lost their entire bank savings’ (p. 30). In the subsequent years, ‘profits exploded while wages grew rather slowly contributing to inequality’ (p. 39). Yet, many Germans continued to believe in the media-induced hope of individual advancement.
Decades later, the rise of ‘neo-liberalism contributed to the production of inequality like nothing before’ (p. 43). Butterwegge argues that neo-liberalism is nothing but ‘the triumph of tax-inequality’ (p. 44). To keep workers in check, ‘globalisation, demographic change, and digitalisation became the new threats’ (p. 48). Despite the many high-sounding claims about the ‘death of neo-liberalism, neo-liberalism continues ‘to contribute decisively to the deepening gap between rich and poor’ (p. 49).
Furthermore, Butterwegge predicts that ‘the stagnating and possibly declining future population and the steady growth of Germany’s GDP should lead to an economic outcome that would be enough for all’ (p. 52). Set against this is the ideology that ‘everyone is responsible for their success or failure’ (p. 59). Yet, ‘nobody can really judge whether the performance of a manager and that of a sales-assistant or pre-school teacher should lead to a higher income’ (p. 63). In other words, ‘it is a myth to associate performance with wealth’ (p. 64). At least since Graeber (2018), we know that there are bullshit jobs – jobs that a society does not need.
Simultaneously, some very much needed jobs like cleaners, delivery drivers, recycling workers, etc. have been confined to a seemingly ever-increasing precariat (Standing 2011). These are workers pushed into Germany’s ‘low wage sector … that too, has led to a rise in poverty’ (p. 72). All of this is not natural as there is no natural law that says a society needs to have inequality. It is also not God-given for it is not God that gave us inequality. Instead, inequality is the result of a deliberate policy. In this case, it was the premeditated policy of social-democrat chancellor Gerhard Schröder – the Genosse der Bosse or comrade of the bosses, as he was known. At a Davos meeting on January 28, 2005, Schröder bombastically announced that he has created ‘the biggest low wage sector in Europe’ (p. 73). Behind Schröder’s low wage sector lurked ‘Hartz IV … a reform of Germany’s labour market and social welfare state’ (p. 74). All too often, the word “reform” serves as an ideological euphemism for pro-business re-regulation.
Worse, Germany’s much acclaimed ‘long-term care insurance [Pflegeversicherung] ended a decade- old policy of burden-sharing in which workers and employers shared the burden equally. With the Pflegeversicherung, costs were offloaded onto workers unilaterally – in short, corporate bosses escaped from their responsibility. Overall, it was just as the billionaire Warren Buffett once said (Stein 2006), there’s class warfare, all right, but it’s my class, the rich class, that’s making war, and we’re winning.
With the kind assistance of willing politicians, the upper class is indeed winning. Guided by the ideology of neo-liberalism, German tax policy favours the ‘Matthew Principle’ (p. 89), for whoever has will be given more, and they will have an abundance. Whoever does not have, even what they have will be taken from them. On this, Butterwegge also argues that despite Germany’s ‘constitutional obligation, established political parties have systematically supported the accumulation of wealth [Reichtumsförderung]’ (p. 90).
Meanwhile, the discovery of the infamous ‘Panama Papers outlining massive tax avoidance, letterbox companies, dubious trust funds, and offshore banking’ (p. 99) has not changed this. Instead, ‘the wealth of German billionaires grew by $95 billion between March 2019 and July 2020’ (p. 110). For example, the ‘two inventors of a COVID-19 vaccine, Ugur Sahin and Özlem Türeci, became billionaires very quickly’ (p. 110). Yet, ‘research for the vaccine was funded to the tune of €375 million [$404 million] by Germany’s ‘Ministry of Science’ (p. 111). Put simply, taxpayers’ money can assist in the creation of billionaires.
In parallel, corporations like ‘Amazon, Alphabet (Google), Apple, Facebook and Microsoft pay no or next to no taxes’ (p. 111). In ‘March 2020, shortly after the start of the COVID-19 pandemic, Germany’s state supported corporations l’ike Lufthansa, TUI, and Galeria Karstadt Kaufhof with €600 billion’ [$644bn] (p. 111). Simultaneously, Germany’s elderlies who depend on state support had to wait fourteen months until finally receiving a one-off payment of €150’ [$161] (p. 112) – another expression of the ‘Matthew Principle’.
Unsurprisingly, even Germany’s very own federal reserve [Bundesbank] had to admit that ‘inequality in Germany remains very high compared to other European countries’ (p. 117). Yet, with the onset of the Russian-Ukrainian war, many expect that ‘poverty and social inequality will only increase’ while Germany’s ‘Rüstungskonzerne or armament corporations will become even more profitable’ (p. 128).
In the final chapter, Butterwegge advocates for a kind of ‘return-distribution [Rückverteilung] of wealth’ (p. 131) arguing that in a more equal society, people will be happier. The author also says, ‘even though poverty is not an infectious disease, poor people are often treated like a leprous person’ (p. 133). At the same time, rising poverty can be seen in the fact that a whopping ‘22% of school children arrive at school with not having had breakfast’ (p. 134). Meanwhile, Germany’s ‘well over 1,000 food banks have to cover twice as much compared to a time when they were still known as soup kitchens’ (p. 153). Today, Germany also has different ‘food banks just for the homeless, clothing exchanges, special shops for the poor, and winter warm-up rooms’ (p. 153).
With that, the author returns to the above-mentioned ‘3Ds of the deregulation of the labour market, the destruction of the welfare state, and the deformation of Germany’s tax system’ (p. 173). Much of this is made possible through a strong ‘lobby of money’ (p. 185). Eventually, Butterwegge reaches the following – and rather unsurprising – conclusion to his book (p. 188; cf. Széll 2022; Artz 2024),
‘as long as the money-lobby defines Germany’s public opinion, political actors will not be game enough to eliminate inequality in Germany’.
Instead, what is likely to continue is the following: ‘the five richest Germans Albrecht/Heister, Böhringer, Kühne, Quandt/Klatten, and Schwarz will own €250bn [$268bn] that is more than half of what all poor people in Germany own’ (p. 189). As recently as March 2024, ‘the Council of Europe demanded from Germany to do more to eliminate mass poverty and the ever-increasing level of social inequality’ (p. 220).
Sadly, Butterwegge and this is despite calling his final chapter “What to do and what will be successful?”, the author offers very little on how to eliminate inequality. Still, his highly illuminating book carries two important lessons: for one, mass poverty and inequality are neither natural, nor God-given, nor caused by an individual simply making bad decisions as neo-liberalism and conservatives like to make us believe; secondly, there are three structural reasons for mass poverty and inequality. The author identifies them as “3Ds”:
the deregulation of the labour market,
the destruction of the welfare state, and
the deformation of Germany’s tax system’
In the end, Butterwegge’s book is magnificent as it outlines the structural causes of mass poverty and rising inequality. In closing his book, the author has correctly identified the link between the state, capitalism, and the media when saying ‘as long as the money-lobby defines Germany’s public opinion, political actors will not be game enough to eliminate inequality in Germany’.
Finally, Butterwegge did not just name the three key actors, namely ‘the money lobby’ (i.e. capitalism), ‘public opinion’ (i.e. the media), and political actors (i.e. the state, governments, and parliaments). But their collusion and their power leads Butterwegge to say that they ‘will not be game enough to eliminate inequality’. In other words, media capitalism has established a system that makes mass poverty and inequality possible – with, as Butterwegge seemingly argues, next to no way out (Lanning 2013; Jeffries 2016).
the destruction of the welfare state, and
the deformation of Germany’s tax system’
In the end, Butterwegge’s book is magnificent as it outlines the structural causes of mass poverty and rising inequality. In closing his book, the author has correctly identified the link between the state, capitalism, and the media when saying ‘as long as the money-lobby defines Germany’s public opinion, political actors will not be game enough to eliminate inequality in Germany’.
Finally, Butterwegge did not just name the three key actors, namely ‘the money lobby’ (i.e. capitalism), ‘public opinion’ (i.e. the media), and political actors (i.e. the state, governments, and parliaments). But their collusion and their power leads Butterwegge to say that they ‘will not be game enough to eliminate inequality’. In other words, media capitalism has established a system that makes mass poverty and inequality possible – with, as Butterwegge seemingly argues, next to no way out (Lanning 2013; Jeffries 2016).
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