The German budget lacks 60 billion euros for climate policy. This is a serious problem for the government of Olaf Scholz.
The German Constitutional Court ruled that the Scholz government had no right to transfer 60 billion euros intended to combat the impact of the coronavirus pandemic on climate policy. This ruling has led to the 2021 supplementary budget being annulled.
“However, this is unconstitutional if the debt brake and the principles of budget law are taken seriously. (…) However, it seems clear that there must be a link between the emergency situation and the loan taken out to cope with this situation,” the “Frankfurter Allgemeine Zeitung” describes the case.
The government fiasco
Finance Minister Christian Lindner of the FDP now faces the extremely difficult mission of finding 60 billion euros. “For the liberal finance minister, this only means bad solutions: raising taxes or taking on new debt. Tax increases are poison in times of economic slowdown. New debts are excluded due to rising interest rates. Especially when we think of future generations who will have to pay it all off. So there remains the possibility of saving and phasing out subsidies. Anyone who remembers the internal coalition dispute over the cuts in the 2024 budget has bad feelings. At the time, it was ‘only’ about 15 billion euros, which brought the coalition partners to the brink of a nervous breakdown,” we read in the Handelsblatt.
However, he writes sharper “Frankfurter Rundschau” stated: that the Constitutional Court’s ruling is a “fiasco for the government”.
Germany is done with nuclear energy
In 2023, Germany finally abandoned nuclear power. On April 15, the last three nuclear power plants in Germany were closed. This ended the process of Germany moving away from using this type of energy, which started in 2002.
The coalition party FDP and opposition party CDU/CSU proposed extending the operation of these types of plants until mid-2024. A large group of experts criticized the discontinuation of nuclear energy.
Source: Do Rzeczy
Roy Brown is a renowned economist and author at The Nation View. He has a deep understanding of the global economy and its intricacies. He writes about a wide range of economic topics, including monetary policy, fiscal policy, international trade, and labor markets.
