On a drizzly day on Berlin’s Bismarckstrasse, the opera to the right and a Thai massage parlour opposite, luxury car dealer Mutlu Kaplan looks up from his computer as the doorbell rings. He’s locked in an online auction for a new Mercedes C-Class and has installed the bell alongside a stern sign at the door: “No sightseers.”
There’s quite a few sights to see in the “Autolounge Piano”: six-figure, four-wheeled luxuries from the houses of Lamborghini, Porsche, Rolls-Royce, Bentley and Maserati.
“Germans don’t like to show their money but sometimes they like to treat themselves,” says Kaplan, in the luxury car business for almost 20 years.
“We have quite a few well-known footballers and when they come into money the first thing they do is buy a house, but we’re usually the second port of call.”
He says most of the wealthy Germans who come through his door drive a hard bargain, are in no way profligate and, he says, “if they can get the car elsewhere for €2,000 less, they will go there”.
Germany is a wealthy country by any measure, but less the blingy Philipp Plein kind than the discreet Jil Sander kind.
The Forbes World Billionaire List estimates Germany has more people with nine zeroes behind their name than anyone else in Europe: 120, compared with Ireland's six. Per capita, the country is only marginally ahead of Ireland: 1.46 to 1.26. But that is not the only measure of how rich a country is.
Largest national economy
So how rich is Germany? It depends where – and what – you count. Undisputably wealthy, it is Europe’s largest national economy and the continent’s leading manufacturer, exporting vehicles, machinery, chemicals and electronics, among other products.
One reliable measure of wealth in the country is the Bundesbank, which says that, despite record low interest rates, private wealth in Germany jumped five per cent last year to €5,857 billion. The Bundesbank counts cash, bank deposits, shares and insurance policies – but not property. Stripping out private debt, the net wealth in Germany was €4,131 billion.
The Bundesbank data does not analyse distribution of wealth. Experts say that, in the post-war decades, West German wealth distribution was quite flat but, in the past decade, distribution of wealth has become more skewed.
On the international Gini coefficient scale of income distribution, which places countries on a scale between 0 (absolute equal wealth disribution) and 1 (absolute unequal), Germany lands in the middle – on 0.504 – up from 0.439 in the mid-1970s. After taxes the income equality coefficient is a more fair 0.295, placing Germany in 16th place of OECD countries, four points ahead of Ireland.
Germany's wealth brings privileges but also responsibilities, not least the largest single contribution to the EU budget. Recent data suggests Germany paid €23.2 billion to Brussels in 2016, but post-Brexit forecasts suggest an extra payment of up to €4 billion may fall due.
Wary of how that will play at home – particularly with the far-right, eurocritical Alternative für Deutschland in the Bundestag – Berlin is using the considerable influence its financial contribution brings to lobby for a trimmed-back future EU budget. Of particular interest to the Germans: cutting agriculture payments and contributions to structurally weak member states.
Households of the super-rich
But without a doubt, Germany's rich are super-rich. Using the Forbes billionaire list to fill gaps in ECB wealth data, a recent report by Germany's Institute for Economic Research (DIW) came to the attention-grabbing conclusion that just 45 households in Germany command as much wealth as half of the population: €214 billion each.
Germany’s rich lists tell their own tale. While some European countries have family fortunes stretching back centuries, the devastation of the second World War means today’s wealth in Germany is a post-war affair, with no new-economy billionaires.
In Germany's top 10 are: Dieter Schwarz, the owner of Lidl; the Albrecht heirs to the Aldi empire; and the Würth family, with a fortune built on screws and the its greatest invention: the dowel.
For Dr Stefan Bach, author of the DIW wealth study, these so-called Mittelstand (SME) families – and their values – are what defines German wealth.
“These families are considered the backbone of the German economy,” said Dr Bach. “They create jobs in the regions and take care of their people.”
If earning and displaying wealth in Germany is a private matter, so too is using it for the common good. Instead of public charity dinners, or prominent plaques in concert halls, Germany’s wealthiest families control charitable foundations capitalised at €21 billion that work behind the scenes.
One of my biggest clients is very modest, with old wealth, yet when she calls me she apologies for bothering me
An heir to the Bosch fortune contributes millions to transsexual rights. Hasso Plattner, co-founder of the SAP software company, has vowed to give away half his $10.9 billion fortune. The billionaire family owners of the Liebherr crane company, with a factory in Killarney, help finance the fight against leukaemia. Those behind the family-owned C&A clothing empire underwrite a multi-billion social fund that bankrolls education and sustainable energy projects.
Helping manage this wealth are people like Frank Straatmann of the private wealth management firm Feri. He says that, along with the fortune, each generation of wealthy Germans inherit from their parents the same interest in discretion and reserve.
“One of my biggest clients is very modest, with old wealth, yet when she calls me she apologies for bothering me,” he said. “I am there to provide a service, but when she apologies she means it.”
Some 500 years after the Reformation, German thinking on riches continues to be influenced by the revolutionary monk Martin Luther. True Christians should not amass wealth but put it to work for the community, he argued, turning their work (Beruf) into a calling (Berufung).
Otto von Bismarck’s pension insurance fund – a world-first in 1889 – underpinned the idea of social redistribution in German minds. Nazi-era fascist logic demonised foreign capital as a “Jewish-Bolshevik” attack on “noble” German firms, while West Germany’s postwar Rhineland capitalism espoused social integration over wealth accumulation.
“There’s always a latent unhappiness, even a hysteria, that hangs over the discussion of wealth in Germany,” said Dr Bach, author of the DIW wealth report. “A wealthy firm owner always has to justify themselves to a degree.”
Wealth manager Frank Straatmann agrees, saying most of his clients insist on remaining completely invisible.
“There is no one answer why they stay in the background and don’t show their wealth,” he said, “but perhaps it is a mix of fears: of being the target of jealousy or resentment — or abduction.”
Even though discretion remains the rule, as wealth is transferred from post-war Germany’s founder generation to their children and grandchildren, some are becoming remarkably indiscreet.
The Albrecht family, behind the Aldi fortune, were once famed for their invisibility but, since the death of the founding brothers, some are now courtroom regulars, with messy inheritance and spectacular fraud cases.
Equally indiscreet have been successful efforts in the past years to head off plans to reform Germany’s inheritance tax – and a block on a proposed wealth tax. This effective lobbying work annoyed some wealthy Germans into forming their own lobby group, demanding that they be taxed more.
It's telling that a majority of the population favours a wealth tax for the very rich
The “Redistribute Wealth” initiative calculates Germany’s private wealth at €12 trillion, and growing by €11,835 a second; the richest 10 per cent control 74 per cent, it estimates, and grows by €8,758 per second.
“People with wealth of over €500,000 should be asked to make a 5 per cent contribution for two years, followed by a 1 per cent wealth tax,” they write in their appeal.
While 64 wealthy Germans have signed up to the appeal, a new wealth tax is one of the core demands of “Aufstehen” (Arise), a new political movement being launched in September by Left Party leader Sahra Wagenknecht.
“It’s telling that a majority of the population favours a wealth tax for the very rich,” she said, “but, apart from the Left Party, no other party has the courage to really push it.”
Festival of wealth
Looking in from Vienna, sociologist Thomas Druyen of the Sigmund Freud University sees Europe’s prosperous giant gripped by an often-contradictory and “unhealthy wealth culture”: not averse to money, but unsure what effort justifies what income, and critical of businesspeople who accumulate a fortune with a good business idea.
"Financial success in Germany," he told the Frankfurter Allgemeine daily, "is celebrated behind closed doors."
One of those doors open only to a a select few was the recent Oktoberfest in Munich, where Germany’s rich and prominent flocked to the “Käfer” tent in the annual festival. It’s a profitable business.
A recent tax fraud court case involving a competitor revealed that in just two weeks, a Munich Oktoberfest tent owner can earn €1.5 million net. Welcoming millionaire business people and FC Bayern players, the Käfer tent sells – alongside beer and roast chicken – that most desired commodity of even the wealthy: peer recognition.
As Ludwig Hagn, millionaire head of the Löwenbräu tent, admits, Oktoberfest “is always gold”.
GERMANY’S 10 RICHEST
1 Reimann family (chemicals, cosmetics, coffee) €33 billion
2 Stefan Quandt/Susanne Klatten (BMW) €31.5 billion
3 Dieter Schwarz (Lidl) €22 billion
4 Schaeffler family (tyres, machines, car components) €22 billion
5 Albrecht family (Aldi-Süd: retail, logistics, property) €21.5 billion
6 Albrecht family (Aldi-Nord: retail, logistics, property) €18 billion
7 Otto family (mail-order sales, logistics) €13 billion
8 Klaus-Michael Kühne (logistics) €11 billion
9 Thiele family (brakes, car components) €9.6 billion
10 Würth family (screws) €9.2 billion