Germany has always had a policy on ensuring the loans they take out as a country was never higher that 0.35%. This has been the key piece of their financial policies. This changed however when the pandemic hit. When COVID happened, the federal government took excess loans to try and balance out the impact it had on the economy. They ended up taking more than needed and now have extra moans left over that were originally allocated for COVID relief.
The plans were to reallocate the excess money but when this was taken to court to determine its constitutionality, it was determined that it would constitutionally be illegal to reallocate the loans to anything other than the original intended purpose. This excess in funds was planned to be used to remedy climate change. Germany currently is $65 billion down and this will not only influence their financial structure but also their political structure.
Although this would not completely dismantle the structure of government it does add pressure on officials. One immediate way to remedy this situation is to amend the constitution but that is much easier said than done. Another way is to try to include climate change as a “crisis” so that they would then use the funds. Currently no news of which path to take is made clear and federal spending has been shut down for the rest of the year excluding what has already been planned.
Source: https://www.cnbc.com/2023/11/23/germany-slides-deeper-into-budget-crisis-heres-what-you-need-to-know.html
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