How destabilizing is Germany's budget crisis? | DW News

The German government “faces some tough decisions” as it tries to find a way out of its current budget crisis, according to one of the architects of Germany’s much-debated debt brake, which limits the government’s borrowing capacity.

Christian Kastrop, a professor for public finance at Berlin’s Free University, told DW’s Michaela Küfner that Germany has a tradition of “being a bit tough on too much debt.”

“And if we look back in history, I think this is not completely a wrong approach,” said Kastrop, who is also Managing Partner of the Global Solutions Initiative.

But he added that a responsible fiscal policy means using a “right mix” of approaches and policies.

Germany’s debt brake is enshrined in the constitution, and it is designed to stop the German state borrowing too much money. It was suspended due to the coronavirus pandemic and then the war in Ukraine.

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