The Union laughs too soon

The Union laughs too soon

After the defeat on the heating law, the CDU/CSU has once again inflicted a bitter defeat on the coalition in Karlsruhe. As understandable as the CDU and CSU's jubilation over the constitutional court ruling is, it will not last. Even the strongest party according to the polls will have to provide answers after this day.

The joint CDU/CSU parliamentary group has fulfilled its key role as the largest opposition party in the Bundestag. With its complaint to the Federal Constitutional Court against the reallocation of 60 billion euros in coronavirus aid, it has examined the constitutionality of the government's actions. Rightly so, say the judges in Karlsruhe, and lower their thumbs over the government's sleight of hand. The conservatives understandably see the ruling as a success, just as they did when the constitutional judge intervened against the legislative procedure for the heating law. However, this time the joy is unlikely to last. This is because the debt brake idolized by the CDU/CSU is being called into question more than ever as a result of the ruling.

The Federal Constitutional Court has by no means given a value judgment on the economic and political sense of the debt rule. The judges merely compared the text of the law with the government's actions and came to a conclusion: What the traffic light coalition had decided with the help of its parliamentary groups, the reallocation of corona loans into funds to restructure the economy and infrastructure, is not provided for in the debt brake enshrined in the Basic Law. If, on the other hand, the German government had taken on debt to combat an acute economic emergency caused by the war in Ukraine, i.e. if it had followed the legal path of the exception, the expenditure could have been entirely constitutional.

The debt brake has its merits

A few hours after the ruling was announced, Friedrich Merz, head of the CDU/CSU parliamentary group, rejoiced at the "end of all shadow budgets" and at the same time made it clear that "there is no justification whatsoever" for relaxing the debt brake. The federal government now finally has no choice but to only budget the money it actually receives. There is much to suggest that this should normally be the case. After all, it is true that the Federal Republic was only able to counteract the pandemic to the maximum thanks to its budgetary prudence in previous years: with reserves and cheap loans thanks to its excellent credit rating. It is also true that a completely different debt policy would have fallen on the country's feet with the interest rate turnaround at the latest. After a long time, debt has become expensive again, even if some people did not want to admit this during the years of the zero interest rate policy.

But the CDU/CSU, it must be said, is not thinking beyond the day: it wants to take on responsibility at federal level again and has good prospects of doing so, just as it already has government responsibility in the federal states. However, if she thinks that the gigantic challenges can be tackled simply by reshuffling the budget and cutting individual projects, she is lying to herself. There may be excesses in social spending and migration costs. One can question whether gigantic chip manufacturers can only be lured to Germany at the price of tens of billions in subsidies. But the need to transform the energy supply and renew the infrastructure is real.

No to the reform of the debt brake is not enough

On the one hand, because Germany is - also constitutionally - bound to the climate targets, but also because the success of the economy and the political sovereignty of the country depend on the cost and reliability of the energy supply. There is no sensible alternative to the massive expansion of renewable energies. Even supporters of nuclear power have to admit that it could no longer step in at short notice at the present time and would also require billions in start-up funding. Germany also needs a more efficient rail network, a modern energy infrastructure, a sustainable heat supply and energy-efficient buildings. The funds earmarked for this in the KTF to date have also benefited and would continue to benefit EU-governed countries.

How all these investments are to be financed while strictly adhering to the existing debt brake and at the same time permanently increasing the defense budget, while the German economy and social system are permanently burdened by immense demographic distortions: The CDU/CSU has just as little convincing answer to this as the FDP. In contrast, the SPD's latest proposal to open up the debt brake to investment spending is more plausible. The proposal is also supported by economists with close ties to employers, not to mention social and environmental associations. However, because the CDU/CSU would have to agree to an amendment to the constitution to reform the debt brake, it can no longer simply say "no" in this debate - not as a government party in waiting. The CDU/CSU, which today can still justifiably be celebrated as the hunters, could therefore soon become the driven party as a result of the ruling.

1. Olaf Scholz, a key figure in the Traffic light coalition, now faces the challenge of crafting a new budget policy that aligns with the Federal Constitutional Court's ruling in Karlsruhe.
2. The defeat in Karlsruhe has placed a significant strain on the CDU/CSU's stance on public debt, especially within the context of the coalition's climate policy priorities and investments in renewable energies.
3. Friedrich Merz, the head of the CDU/CSU parliamentary group, has expressed his opposition to loosening the debt brake, despite recognizing the difficulties in financing climate-related investments and infrastructure upgrades.
4. The CSU, a member of the Union parliamentary group, will need to find a compromise on budget policy to address the pressing issues of public debt, climate policy, and renewable energy investments, as the FDP has already proposed opening up the debt brake to investment spending.
5. As the largest opposition party, the CDU/CSU critiqued the Coalition government's handling of the reallocation of 60 billion euros in coronavirus aid, which led to a constitutional court ruling that undermined the effectiveness of the debt brake.
6. The CDU/CSU may struggle in the political arena if it fails to provide viable budget solutions to tackle climate change and invest in renewable energies while adhering to the debt brake, as the German economy and social system face lasting demographic distortions.

Source: www.ntv.de