Germany isn't facing a debt crisis, but a crazy budget crisis triggered by the ruling of our constitutional court. Here's a🧵what this is all about.
In the media you read about 60 bn unused "Corona debts" shifted to a climate fund. But actually, the issue runs much deeper. /1
In the media you read about 60 bn unused "Corona debts" shifted to a climate fund. But actually, the issue runs much deeper. /1
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This is actually the *major* impact of the court's ruling. And from an economic point of view, it is pretty crazy. Let me illustrate. /2
Unambiguously, the emergeny clause of the debt brake (Art. 115 GG) could apply, because the event is exogenous, unexpected and outside government control. /3
So let's pull the debt brake emergency clause, since it was invented for cases like that /4
Then you draw out a plan for the outflow of funds, because obviously it will take some time./5
If you're lucky, you manage to deliver those "helicopter drops" already before Christmas eve 2024. But then the problem starts./6
Money will thus *necessarily* flow in the years t+1, t+2, ... AFTER the disaster event. /7
Eines ist aber klar, wenn das Instrument nicht mehr gewollt / tauglich ist, dann bedarf es einer Verfassungsänderung. Dazu sind politische Mehrheiten zu organisieren.