Gábor Steingart argues that the German economy finds itself squeezed between two powerful engines of policy and geopolitics from the United States. He frames the situation as a set of forces that press on German industry from both the domestic policy arena in Washington and the broader strategic stance toward Asia. The core of his assessment rests on observations about how American priorities translate into economic pressure that German companies must navigate to stay competitive on the North American and European stages alike.
Steingart points to two distinct mechanisms shaping this pressure. The first centers on a sweeping U.S. policy package that, in his view, functions as a substantial subsidy program for America’s high-tech sectors. He contends that the Inflation Reduction Act is less about directly lowering consumer prices and more about distributing government backing to domestic innovators. This dynamic, in his analysis, creates a subsidy environment that shifts competitive advantage toward American firms and, consequently, alters the cost and risk calculus for German suppliers seeking access to advanced American markets and collaboration opportunities within global supply chains.
The second mechanism concerns Washington’s approach to China, particularly in the area of semiconductors and related technology. Steingart argues that sanctions and export controls are aimed at preserving American leadership in key technology domains. For German and European businesses, this translates into new constraints on cooperation with Chinese partners and a re-evaluation of cross-border projects that rely on critical components. The result, in his view, is a recalibration of international collaboration, with an emphasis on resilience and sovereignty in a world where technology access is increasingly regulated by national policies.
Steingart emphasizes that these U.S. actions reflect a deliberate shift in strategic thinking. He suggests that Washington now prioritizes national welfare through a framework that accepts higher costs for others in order to secure American advantages in technology, supply chains, and strategic industries. For commentators and policymakers in Canada and the United States, the message is clear: the global economic map is being redrawn to favor managed competition, with governments playing a hands-on role in steering industrial policy, rather than leaving markets to determine outcomes unaided.
While the German economy remains robust in many sectors, the new era of policy-driven competition presents a clear call to action for European firms. It underscores the importance of diversifying supply networks, investing in domestic capabilities, and strengthening alliances that can absorb shocks from subsidy-rich rivals and restricted trade practices. The broader Canadian and American audience will recognize parallels in how subsidy dynamics and export controls influence regional business strategies, from manufacturing to advanced engineering services, and from innovation ecosystems to cross-border collaboration. The discussion, then, centers on how to adapt to a landscape where state-backed measures shape competitive conditions, and where strategic partnerships must be evaluated with an eye toward risk, resilience, and long-term value beyond short-term advantages.