Germany is in a bizarre fiscal mess of its own making
Three steps to resolve the fiscal panic
Germany mAY pride itself on its fiscal prudence, but over the past fortnight it has been in the grip of a bizarre fiscal panic. At the heart of the drama lies the much-revered “debt brake”, a constitutional clause that limits the country’s budget deficit, but which the government has resorted to circumventing through a series of special funds. On November 15th the country’s constitutional court ruled that one such wheeze to finance €60bn ($66bn), or 1.5% of GDP, in climate spending was illegal, jeopardising all the financing done in this way.
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This article appeared in the Leaders section of the print edition under the headline “Debt break ”
Leaders December 2nd 2023
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From the December 2nd 2023 edition
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