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Federal Finance Minister Olaf Scholz: "That is a lot of money"
Photo: Michael Sohn / AP
Federal Finance Minister Olaf Scholz (SPD) considers the debt burden to be bearable despite huge gaps in the budget.
After the coronavirus crisis, Germany will have lower debt than many other states before the outbreak of the pandemic, said the SPD candidate for chancellor in Berlin on Tuesday.
The debt ratio in relation to economic strength rose to over 80 percent in the 2009 financial crisis, this time it would probably be 75 to 76 percent.
"That's a good sign."
This week, the Bundestag is discussing the grand coalition's draft budget for 2021. This provides for new debt of a good 96 billion euros - the second highest after the record this year.
"That's a lot of money," said Scholz.
The aid measures to support the economy should not end abruptly.
As an example, he cited the recently extended option for short-time work.
"Not acting would be much more expensive than acting," said the finance minister.
Thanks to solid budget management, the government has been able to counter the crisis with full force since 2014 - and must do so.
According to Scholz, the gross domestic product will collapse by 5.8 percent this year - about as much as in the financial crisis.
In the financial planning from 2021 to 2024 investments amounting to 199.2 billion euros are planned - considerably more than in earlier times.
This will also trigger private investments and ensure additional growth, said Scholz.
As for 2020, the debt brake must be suspended again.
At the same time, Scholz emphasized that "a path" had to be achieved again in order to no longer have to make use of the exception rule in future.
"It is necessary and right that we react decisively to this crisis and that we counteract with all our might," said Scholz.
The government's previous measures to combat the corona crisis have had an impact: "Economic activity is recovering and consumer sentiment is improving."
"Corona heroes want a decent salary"
Scholz campaigned for more solidarity in the crisis.
The federal budget for 2021 is about a lot of money, "but it's also about how we actually want to be," said the finance minister in the Bundestag.
"Because in a crisis you have to show who you are."
Germany presents itself as a democratic country with an efficient federalism that knows "where it is going".
It's not just about fighting the corona crisis, but also about stopping climate change, sticking together and being a social country.
Economic growth should not be based on the fact that some in the country are doing badly, emphasized Scholz.
All citizens should have good and decent working conditions.
"The Corona heroes don't want any medals from us, they just want a decent salary," said the Vice Chancellor.
"We have to make sure of that."
Union insists on an early return to the black zero
The coalition partner of Scholz's Social Democrats insists on returning to the black zero in the budget after 2021.
This year and next, loans are needed to invest in health, the economy and the digitization of education, said Ralph Brinkhaus, head of the
Union parliamentary group
.
But under no circumstances should debts become permanent.
"Debt is a sweet poison," warned Brinkhaus.
They were tempted to try to solve all problems with money.
But Germany will only grow out of the crisis if the economy grows and there are well-paid, fair jobs.
The
AfD
spoke out against suspending the debt brake in the Basic Law in the coming year due to the corona crisis.
The pandemic does not cause any emergency situation that would justify it, said AfD housekeeper Peter Boehringer in parliament.
Necessary expenditure to stabilize the economy could also be raised from the 48 billion euros reserve, which Finance Minister Scholz does not want to touch.
There was also criticism of the finance minister's plans from the other groups.
The
FDP
spoke of gaps in the planning.
Scholz did not know how he could service his planned debts in the coming years, said budget politician Otto Fricke.
Scholz had submitted a budget for chancellor candidates that had to be unloaded by the next federal government.
"That has nothing more to do with sound housekeeping," said Fricke.
In his draft budget for the coming year, the finance minister does not want to cut any expenditure or subsidy significantly.
Instead, more should be spent after the crisis than before.
In
response to the corona crisis, the
left
demanded the abolition of the debt brake and a wealth tax for millionaires.
"We on the left consider the debt brake to be economic nonsense," said housekeeper Gesine Lötzsch.
If one wanted to stick to the rule in the Basic Law, there were only two options left to plug the holes in financial planning by 2024: drastic cuts in the social budget or an increase in taxes.
The left is calling for a decisive redistribution through a wealth tax for millionaires and billionaires.
The
Greens
warned against tough austerity measures after the crisis.
"There must be no broken savings after Corona," said budget politician Sven-Christian Kindler.
You shouldn't save on social security and municipal infrastructure just to return to the debt brake from 2022.
Now we have to boldly invest in the future, for example in climate protection and the traffic transition.
To finance this, on the one hand, strong shoulders should carry more, "because they can also carry more".
At the same time, however, the debt brake should be reformed.
In view of the historically low interest rates for a long time to come, certain investments should be financed through loans.
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asa / Reuters / dpa / AFP