If reason were to rule, populism would have long since run its course and would no longer be in power or in government anywhere. Because: „Populism jeopardises your prosperity!“, summarise the economists at Allianz Global Investors. They point to their own studies, according to which populist regimes ultimately dampen growth over time and further fuel distribution conflicts, drive up national debt, weigh on share and currency prices and increasingly curtail freedom rights in the economy. This paralyses the power of innovation and reduces efficiency at all levels and is therefore mostly directed against those who support populists.

Financial market players should therefore actually do everything they can to avoid falling for short-lived promises or indirectly giving them the means to stay in power for longer. Because that is neither in their interest, nor in that of the economy and finance.

But reason does not rule. The distribution conflicts often produce unholy alliances, some corporate bosses make common cause with populists in the hope of sharing power and success; and many companies cower because populists undermine the rule of law and use it aggressively for their own purposes against disagreeable actors. A look at the USA shows the whole range of populist varieties.

In this respect, the work of the two Allianz economists Hans-Jörg Naumer and Stefan Hofrichter is of great value in helping us to realise the potential of democracy and market economy. Both together are capable of defusing distribution conflicts and increasing prosperity - if they are allowed to take effect. Based on data from numerous economies, with and without populist governments, they come to the conclusion that the freer a country is, the higher the gross domestic product per capita, the greater the innovative strength and the more comprehensive the sustainability of an economy. At the same time, the concentration of wealth is lower and the financial market develops better.

Naumer puts it in a nutshell: „MEGA instead of MAGA! It's about „Make the Economy Great Again“ instead of a policy that emphasises isolationism and „Make America Great Again“.“

With regard to Germany, he sees positive approaches here again: There is finally a political phase in which the government is „seriously looking after the economy again“. However, more needs to be done to avoid succumbing to the populist temptation: promoting social participation, less frustration caused by bureaucracy, more education together with the credible promise of social advancement, conveying a positive image of the market economy and markets. There is still a lot of catching up to do here in Germany. And this does not necessarily have anything to do with more government spending and political pandering to individual groups.