If it also signals its approval, as expected, the negotiations could start as early as next week – and Olaf Scholz (SPD) may be elected as the next Federal Chancellor well before Christmas.
The director of the Institut der Deutschen Wirtschaft (IW), Michael Hüther, finds the passage on future investments “within the framework of the debt brake” “puzzlingly open”. One solution for this could be investment companies for the various infrastructure networks, he told the Handelsblatt. Hüther himself had already questioned the debt brake in 2019.
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The SPD-Left also wants a “public investment company” in order to be able to invest in compliance with the debt brake. It depends on whether the traffic light “can usher in a decade of modernization or not,” said Dierk Hirschel, member of the board of the SPD forum Democratic Left 21 and Verdi chief economist.
Scholz: “It’s about combining things correctly”
SPD Chancellor candidate Olaf Scholz has rejected the accusation that the traffic light explorations did not provide an answer to the question of whether the plans could be financed. It is about a great departure, the modernization of the country, said Scholz on Sunday evening in the ZDF program “Berlin direkt”. To a large extent, it is a question of enabling private sector investments.
But it is also clear that additional funds must be made available for public investments. “So it’s about combining things correctly,” emphasized Scholz. “What we have set out to do is to operate very solidly and at the same time to bring about a decade of investments in Germany, both privately and publicly.”
Regarding proposals to set up public investment companies, Scholz pointed out that there have long been public institutions that have been investing. He cited Deutsche Bahn and KfW as examples. “In this respect, this is only a description of a principle that already exists and that must be included in the scope of the options for action.”
The exploratory paper simply says: “We will guarantee the necessary future investments within the framework of the constitutional debt brake, especially in climate protection, digitization, education and research as well as the infrastructure.”
According to Habeck, the traffic light parties are further on the financing issue than the exploratory paper reflects. “The finances are better supported in the talks than the paper shows,” said Habeck on ZDF. “The sentences are Spartan, I admit that. But we have given a lot of thought to how these sentences will then be backed up with concrete possibilities in the coalition negotiations. “
Another suggestion on how the new government could get more money without increasing taxes comes from Ifo boss Clemens Fuest: It could go into debt again in 2022 and park in a reserve before the debt brake applies again in 2023. Veronika Grimm’s economy can also take advantage of this. DIW boss Marcel Fratzscher specifically suggested raising an extra 500 billion euros.
At the same time, smaller new sources of income are opening up: for example, the planned global minimum tax for companies in Germany, which the SPD leader and Federal Finance Minister Olaf Scholz is instrumental in pushing, could bring in five to six billion euros a year.
The potential coalitionists also expect more intensive measures against tax evasion, money laundering and tax avoidance as a big plus, they write in the paper. After all, “Germany is still a money laundering paradise,” admits SPD leader Norbert Walter-Borjans frankly in “Bild am Sonntag”.
“The authorities are not even able to deal with the suspicious transaction reports from the banks.” An effective fight against fraud and the closing of loopholes could well bring “annual additional income in the double-digit billion range”.
After all, cannabis legalization could also wash billions of euros into the state coffers a year, economists estimate. All three partners are open to this, even if it is not mentioned in the exploratory paper.
According to an earlier study by economist Justus Haucap, this could bring in around 2.7 billion euros annually. In the meantime, he even expects significantly higher income from taxes and savings elsewhere, he told the “Spiegel”. He plans to publish a new calculation shortly.
The announcements in the exploratory paper on pensions met with massive criticism: “We will strengthen the statutory pension and secure the minimum pension level of 48 percent. There will be no cuts in pensions and no increase in the statutory retirement age. “That is” unsatisfactory and contradicting, “complains Hüther. “This challenge cannot be adequately met in this way,” warns the economist.
Ifo boss Fuest reacts even more sharply to this passage: It is “anything but promising” because “these pension resolutions are not compatible with sustainable financial policy. The pension reform is apparently simply postponed. ”
Given the demographics, it could not work “to set the pension level at at least 48 percent and at the same time not want to touch pension cuts and the entry age”.
The other measures mentioned, such as increasing the employment of women and immigrants, “are simply not enough – even if they are to be supported in principle,” he told the Handelsblatt.
So far, politicians have always set stop lines for pension contributions. In the paper of the traffic light explorer, however, it only says that the contribution rates should be stabilized in the long term by entering into a funded fund. “How that should work is unclear,” says Fuest, “the contributors can expect a lot.”
Hüther calls raising the minimum wage “politically questionable”
A central clear point of the explorers was the agreement to raise the minimum wage to twelve euros under pressure from the SPD and the Greens. Hüther calls this “regulatory policy questionable”. The intervention not only undermines the social partner commission, which is generally responsible for determining the minimum wage.
It also stands in contrast to the planned new experimentation rooms in the world of work and better incentives for mini-jobs. The employers had already heavily criticized the minimum wage resolution. Ignoring the minimum wage commission is “a serious interference with collective bargaining autonomy” and “extremely dangerous”, warned its president Rainer Dulger.
FDP leader Christian Lindner, on the other hand, defended the compromise that the Liberals entered into: “The one-time exception is justifiable and corresponds to the opinion of the majority of the population,” he told “Bild am Sonntag”.
The vague innovation plans of the three parties, which above all promise modernization, digitization and new beginnings, also meet with criticism. According to the result paper, they want to increase Germany’s spending on research and development from 3.2 percent to 3.5 percent of gross domestic product. That is definitely “ambitious”, says IW boss Hüther. However, the three negotiators do not name a year for this. The elected grand coalition wanted to achieve the 3.5 percent target by 2025.
The chairman of the Expert Commission for Research and Innovation (EFI), Uwe Cantner, criticized the fact that “there is still no overall concept for a radical change of direction in Germany on a broad scale”. So far, the explorers have been content with mentioning the expected keywords such as start-ups, transformations, digital business models or specialist strategies. The task now is to “set up a consistent new program for research and development”.
The trick is to “pour the mutual dependencies of state modernization, digitization, climate protection, innovation and competitiveness into a whole that is coordinated in terms of content and timing”. To do this, the partners would have to create completely new structures and formats. Modern, agile forms of innovation policy have not even been discussed so far.
The paper generally promises the modernization of the state. Green veteran Jürgen Trittin uses the example of approval procedures to describe what that should actually mean: “My suggestion: The authorities have six weeks to determine whether the application documents are complete. You can only ask for something once, “he told the” Bild am Sonntag “.
“Then you have half a year to make a final decision.” Green party leader Robert Habeck had also called for the approval process for wind farms to take only six months instead of six years.
With agency material.
More: The traffic light now offers the chance for a real reform government.