"I can't promise you more state aid from the federal budget!" To the boos of some 10,000 farmers who came to protest in Berlin on Monday, German Finance Minister Christian Lindner did not keep any false promises. However, Germany is far from being in the most strained fiscal situation. But it has trapped itself with its own debt-limiting principles: at the end of last year, the state's highest court rejected 60 billion euros of spending deemed unconstitutional. As a result, Olaf Scholz's government has cut diesel subsidies for farmers, but also the ecological bonus for the purchase of electric vehicles.
After the largesse linked to the Covid crisis and then to the energy crisis after the invasion of Ukraine, the coming year will be marked by fiscal tightening. After four years of suspension, the eurozone's deficit (3% of GDP) and debt (60%) rules have come into force again...
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