Prospects and fears in the EU over the possibility that the intransigent is the German Minister of Finance

Germany’s primal neighbors watch the formation of the country’s new government with a mixture of perspective and concern, between questions {which a tax hardline supporter has strongly sensed of becoming the next finance minister might simply once again drag the continent into the icy dead ends of the peril euro zone. Social Democratic Birthday Celebration (SPD), German Vegetables and Free Democratic Birthday Celebration (FDP) are expected to result in a new ‘soft’ power-sharing deal for visitors on Friday, with official talks coalition eager to start next week. The future German Chancellor within the framework of such an association, the outgoing Social Democratic Minister of Finance Olaf Scholz, is a valued partner of the governments of Paris and Rome after parting from his country’s position of pride throughout throughout the pandemic. “Scholz is not an ideologue, he is a pragmatist, for having contracted a debt not uncommon as part of the Covid restoration plan,” said Stéphanie Yon-Courtin, a French MEP ally of Emmanuel Macron.

Christian Lindner, the head of the FDP, not too long ago, 4 years ago, Greece was briefly kicked out of the eurozone and dismissed Macron’s financial plans as making the EU a “system Soviet Union style “. ”.

However, it is the liberal politician who should take over the finance ministry from Scholz who has, as the German news newspaper Focus puts it, “half of Europe is shaking in his boots”.

In the winter of 2015-16, the 42-year-old’s contemptuous view of one of Germany’s biggest neighbors sparked a minor diplomatic incident at a dinner he attended. attended as honorary visitor to Berlin. According to one of the many present guests, Lindner said: “We cannot use German workers ‘savings accounts to save Italians’ savings. “

France and Italy argue it’s time to change the Stability and Progress Law, which sets strict limits on government borrowing. These budget guidelines, stipulating that fund deficits should not exceed 3% of GDP, were suspended from the start of the pandemic until early 2022.

It was a blow that drew an icy response from the Italian Ambassador to Berlin. The Italian diplomat raised his hand and reminded Lindner that Italy had contributed to Greece’s bailout funds, which ultimately benefited French and German banks, observing dryly: “If I remember correctly, it was the Italians. who paid off German debts.

The FDP has positioned itself to help the eight northern European countries, as well as Austria, Denmark and the Netherlands, who would like to have the foundations up and running once the pandemic suspension is over. In its manifesto, the celebration rejects the idea of ​​introducing additional European taxes as “incompatible with European treaties”.

Whether the FDP is as strong in the authorities as it has acted outside, however, is not a given.

While its MEPs sit in the same European Parliament group as those on Macron’s list, the celebration of democratic freedom has a distinctly German flavor: pro-business and anti-fiscal yet largely important to American-style libertarianism. , socially liberal but allergic to the spending of the Keynesian authorities. . When the Free Democrats were finalists in a coalition with the Social Democrats from 1969 to 1982, they laid out their position as the federal government’s fiscal watchdog. “A watchful eye on public debt and inflation rates is in the DNA of the FDP and all previous German liberal parties,” said Karl-Heinz Paqué, chairman of the Friedrich Naumann Foundation for Freedom, a group reflection affiliated with the FDP.

modify the Stability and Progress Pact, which stipulates that fund deficits must not exceed 3% of GDP. Photography: Anadolu Agency / Getty Images
But throughout his last tenure in power, the FDP, as a junior partner of Merkel’s conservatives, has discovered the laborious method by which a rigid stance on European financial affairs can work against it. At the height of a period marked by parliamentary wrangling over the eurozone disaster, its aid fell by nearly 10 factors and the celebration was withdrawn from parliament. “The two main reasons the FDP suffered so much after entering government from 2009 to 2013 are that the party did not propose any tax reform and fell into internal squabbles over the inevitable bailout programs needed to cope with the eurozone crisis, ”Paqué said.

“Since then, the party’s libertarian minority has been pushed back. Under Lindner, who took the reins as party leader three months after the 2013 defeat, Paqué said the FDP had become “more comprehensive and pragmatic.” The Free Democrats’ end result was ultimately stable – 11.5% of the vote, a minor improvement from 2017 – but barely a triumph, which is one of the reasons the celebration has attracted more and more people. attention to its recognition among first-time voters. And while young FDP supporters are also involved in intergenerational debt, they don’t really feel connected to the particular tax fetishes the celebration has clung to in the past.

“We see that young Germans demand long-term sustainability from politics,” Paqué said. “But not all of them define sustainability in a purely ecological way like the Greens, but also more broadly, in a technological, social and economic sense. And these young voters are drawn to our philosophy. The FDP could have declared its intention to bring the EU tax guidelines back to their pre-pandemic situation, but even the leading voices of Germany, a very efficient company, our financial bodies and institutes have recently struck a chord. .

“The next German government is formed as part of a rapidly evolving political debate,” said Christian Odendahl, chief economist at the Center for European Reform think tank. “The negative interest rates have eased the fears of the Germans about indebtedness. More importantly, the next government will be required by law to meet specific climate goals. “The current promise of the FDP is that these goals can be achieved through a cross-sector cap-and-trade program. What they aren’t saying yet is that such an approach will inevitably lead to higher carbon prices, which they don’t want either. Something will have to give way.

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