WE WILL KEEP INHERITING UNTIL EVERYTHING SHATTERS

I. The Song

In 1933, they sang: We will keep marching until everything shatters.

One word has changed. The principle has not.

Germany no longer marches. Germany inherits. It inherits companies whose founders are dead. It inherits fortunes whose creators no one remembers. It inherits brands whose substance is exhausted. It inherits positions whose competence was not passed along. It inherits prosperity built on industrial achievement that no one achieves anymore.

And it keeps inheriting all of this until everything shatters.

II. The Novelist

Thomas Mann wrote it all before. In 1901. In Lübeck. Buddenbrooks. Decline of a Family.

The first generation builds. Old Johann Buddenbrook — vivacious, practical, successful. The second generation manages. Jean Buddenbrook — pious, dutiful, still capable. The third generation represents. Thomas Buddenbrook — outwardly brilliant, inwardly exhausted, unable to renew. The fourth generation dies. Hanno Buddenbrook — musical, sensitive, weary of life. He draws a line beneath his name in the family chronicle.

Mann called it "Decline of a Family." It was the diagnosis of a country. While the Buddenbrooks refine and decay, the Hagenström family rises — coarser, more energetic, more ruthless. The Hagenströms build. The Buddenbrooks inherit.

124 years later, a novel has become a statistic.

III. The Numbers

231,000 small and medium-sized businesses are planning to close by the end of 2025. This is a historic peak. Never since records began have so many companies considered shutting down.

215,000 companies are seeking a successor. Only 28 percent have found one. This is the lowest figure ever measured.

The average age of owners: 54. In 2003 it was 45. Business owners are aging faster than the general population. 39 percent are over sixty. Those wanting to hand over now average 65.4 years old.

One third of all family businesses fail when transitioning to the second generation. Two thirds fail in the third. 85 percent fail in the fourth.

Hanno Buddenbrook draws the line. 231,000 times.

IV. The Fools' Tax

In 2024, assets worth 113.2 billion euros were assessed for inheritance and gift tax in Germany. 13.3 billion euros in tax was levied — a new record. Actually paid: only 10 billion. The average tax rate: 8.8 percent.

But this number lies. Because it is an average concealing a chasm.

45 mega-heirs received combined business assets of nearly 12 billion euros in 2024. Initially, 3.5 billion euros in tax was assessed. Then 95 percent of it was waived. Actually paid: 180 million euros. Effective tax rate: 1.5 percent.

Someone earning a median income of 50,000 euros through work pays over 20 percent in taxes. Someone inheriting 12 billion pays 1.5 percent.

The Network for Tax Justice calls the inheritance tax a "fools' tax." It is paid by those who plan poorly — meaning those who inherit too little to afford good advisors. The largest inheritances pass virtually tax-free. The exemptions for business assets are, according to the federal government's own subsidy report, Germany's largest tax subsidy: approximately 7 billion euros per year. Since 2009, the state has foregone roughly 90 billion euros.

90 billion. For the right to inherit without being taxed.

V. The Quandts

The Quandt family is the living textbook. Not for entrepreneurship. For inheritance.

The origins of the fortune: a textile factory in Brandenburg, late 19th century. Expansion through naval contracts in World War I. Further expansion through stock speculation during the Weimar crisis. Early support for the NSDAP. Profits from the expropriation of Jewish property. Forced laborers in the factories. Günther Quandt laid the foundation. Herbert Quandt rescued BMW from bankruptcy in 1959 and built the company. That was the family's last entrepreneurial act.

Today Stefan Quandt and Susanne Klatten control 48.5 percent of BMW's voting rights. Their share of BMW profits since 2001: 58 billion euros. Of that, 18 billion distributed as dividends. In 2024: two billion euros in dividends. Three million euros per day.

Fewer than one in five German billionaire fortunes are based on companies led by their founders. The Quandts do not lead BMW. They own it. The difference between owning and leading is the difference between inheriting and building. Susanne Klatten sits on the supervisory board. That is something different from developing a car.

And the taxes? Dividends are effectively taxed at 1.5 percent after flowing through holding companies. The transfer of wealth from Johanna Quandt to her children exploited every available gift tax provision. Party donations to the CDU and FDP — several million euros in total — bear no discernible disproportion to the tax privileges that remain in place.

One could take this for coincidence. One could also take it for a business model.

VI. The Buddenbrooks Syndrome

Researchers call it the "Buddenbrooks Syndrome," as if it were a disease. It is not a disease. It is a law.

70 percent of all wealth transfers to the next generation fail. Of Germany's 3.2 million family businesses, only 30 percent survive the transition to the third generation. The economic damage: several hundred billion euros annually.

The reasons are always the same. The number of heirs grows exponentially; capability declines arithmetically. In the first generation, one or two people decide. In the third, ten to twenty shareholders who barely know each other. Cousins in different countries, with different careers, different life plans. The family business becomes an investment — or a burden.

Mann condensed this into a single image. Hanno Buddenbrook, the last scion, has no interest in business. He makes music. And he draws the line beneath his name. Not in rebellion. In exhaustion.

231,000 Hannos draw the line. Most not from exhaustion. From absence. There is simply no one left who wants to — or can — take over.

VII. What Gets Inherited

Germany inherits its industrial legacy. But inheritance is a strange word. It sounds like transmission. In truth, it is often the opposite.

What gets inherited: the wealth. The shares. The real estate. The brand. The name.

What does not get inherited: the competence that created all of it. The engineering knowledge. The willingness to take risks. The ability to build something that did not exist before.

A family business in mechanical engineering. The founder invented a machine, filed a patent, opened a market. His son expanded the business, modernized, internationalized. His grandson inherits the company, the clients, the reputation. But he does not inherit the knowledge of how to invent a machine. He does not inherit the courage to file a patent when everyone says it will not work. He does not inherit the nights in the workshop.

He inherits the result. Not the process.

And because the process is not inherited, the result depletes. Slowly. Over one generation, over two. Sometimes over three. But it depletes. Always.

The Hagenströms are already waiting. Today they are called BYD, Tesla, CATL, Shenzhen. They inherit nothing. They build.

VIII. The Inheritance Republic

Germany is an inheritance republic. This is not polemic. It is a description.

113 billion euros are assessed annually as inheritance or gifts. The actual figure is higher — many smaller inheritances remain below exemption thresholds. Estimates suggest the true annual inheritance volume runs between 300 and 400 billion euros.

In a society where so much is inherited, the center of gravity shifts. Not achievement determines status, but origin. Not what someone builds, but what someone receives. The wealthiest ten percent inherit half of the total volume. The poorer half receives nothing.

This is not just unjust. It is hostile to innovation. Those who inherit need not found. Those who receive a company need not build one. Those who collect dividends need not take risks. The inheritance republic rewards receiving and punishes making.

In Shenzhen there is no inheritance republic. Not because China is more just — it is not. But because there was nothing to inherit. Anyone standing in Shenzhen thirty years ago stood in a rice paddy. They had to build. Or starve. Urgency created innovation.

In Germany there is no hunger. There are inheritances. Inheritances create comfort. And comfort creates — nothing.

IX. The Sheltered Inheritance

In a previous essay I described the sheltered workshop — the German culture of risk avoidance that holds everything in a state of permanent prototype production. The inheritance republic extends this principle across generations.

The sheltered workshop avoids risk in space. The sheltered inheritance avoids risk in time. Together they produce a society that builds neither in the present nor for the future, but lives off the past.

The inheritance tax privilege for business assets was introduced with the argument that it protects jobs and investment. The conditions: heirs may not sell the company and may not lay off too many employees. Whether this actually leads to more investment remains unproven. Studies suggest the privileges may even work against their stated purpose.

The logic is that of the sheltered workshop: the system protects itself. It protects neither innovation, nor jobs, nor the future. It protects the status quo. And the status quo is: decline.

X. Söder's Paradox

Bavaria's Minister President Markus Söder wants to hand the inheritance tax entirely to the states and halve it in Bavaria. Bavaria is suing in the Federal Constitutional Court against nationwide exemption thresholds.

This is remarkable. Because simultaneously, Bavaria has invested 1.2 billion euros in a new technical university — the UTN in Nuremberg — and Bavaria's government celebrates the arrival of AI companies like Anthropic and OpenAI in Munich as a success of its Hightech Agenda.

The paradox: Söder wants to build the future and protect the past at the same time. He invests in an AI university and simultaneously wants to grant technology heirs tax exemptions. He wants innovation and stasis. Both simultaneously.

That does not work. At some point one must choose: does one build or does one inherit?

Because every billion the state forgives the heirs is a billion missing for founders. Every subsidy protecting existing structures is missing for new ones. And every tax privilege easing transmission makes new creation relatively more expensive.

90 billion euros in inheritance tax subsidies since 2009. What could have been built with that? A European AI industry. A battery manufacturing base. A semiconductor plant. Or thirty UTNs.

Instead: 90 billion for the right to inherit what one did not build.

XI. The Two Inheritances

There are two ways to inherit something.

The first way: you inherit a tool. A workshop. A skill. You inherit the ability to do something. Japanese swordsmithing has been passed down for centuries — not as property, but as mastery. The heir must learn the craft from scratch before earning the right to bear the name. The inheritance is an examination, not a gift.

The second way: you inherit a result. An account. A stake. A seat on the board. You inherit the fruits of an achievement without having achieved anything. The inheritance is a distribution, not an obligation.

Germany has chosen the second way. It inherits results. Accounts. Stakes. Board seats. It does not inherit the knowing, but the having. Not the process, but the product.

And that is why the product decays. Because no one any longer commands the process that could renew it.

XII. The Final Line

Hanno Buddenbrook drew a line beneath his name in the family chronicle. His father Thomas asked in horror what it meant. Hanno replied: "I thought — I thought — there was nothing more to come..."

231,000 companies believe: there is nothing more to come. Not because they have failed. Not because the market has disappeared. But because no one is left who wants to take over. Because the heirs have other plans. Or because there are no heirs.

45 mega-heirs receive 12 billion euros and pay 1.5 percent. 231,000 small business owners find no successor and close their doors. This is not a contradiction. It is the same system. Wealth flows upward, to those who do not build. It drains away at the bottom, where building happened.

The Family Business Foundation demands less inheritance tax. The trade unions demand more. Both are right. And both miss the point. Because the problem is not the rate of taxation. The problem is that a society which inherits more than it founds is organizing its own decline — subsidized by the tax code.

In 1933, they sang: We will keep marching until everything shatters. That was a threat.

In 2026, they inherit: shares, dividends, privileges, brands without substance, companies without successors, prosperity without competence. This is not a threat. This is everyday life.

Thomas Mann had Hanno Buddenbrook die at fifteen. Of typhus. In truth, Hanno died of something else: of the refusal to accept an inheritance that consisted only of obligation and not of capability. He was the most honest Buddenbrook — because he drew the line that the others would not draw.

231,000 business owners are drawing that line now. Not from honesty. From necessity. And the 45 who inherit 12 billion draw no line at all. They need not. For them, there is always more to come. Three million euros per day.

We will keep inheriting until everything shatters.

The only difference from 1933: back then, they knew where they were marching. Today, no one knows what they are inheriting.