Latest news with #FreeDemocrats
Yahoo
09-05-2025
- Politics
- Yahoo
German lawmaker in hot water over talks with Russian representatives
A Social Democrat lawmaker in Germany has been forced to defend himself against criticism for taking a trip to Azerbaijan for talks with Russian representatives, which came to light after a media investigation. "One of the principles of good foreign policy is that, even and especially in difficult times of increasing tensions, conflicts and wars, dialogue contacts in all parts of the world and also with Russia should be maintained," Ralf Stegner wrote in a joint statement with three former members of the parliament on Friday. German media had reported on the trip to Baku which Stegner and others took on April 14. Stegner told dpa that he was surprised at the polemical reaction, which had "no grounds." "It's important to have contact for there to be any dialogue at all," he said. Stegner stressed that he did not go as a government representative, but a freely elected member of parliament. It was "based on private initiative and organized and financed informally," he said. No sensitive security information or even secret information was exchanged, he said. The deputy chairman of the parliament's intelligence oversight panel, conservative Roderich Kiesewetter, told reporters previously that Stegner "would have to face some questions" on the visit. A senior politician from the liberal Free Democrats, Agnes Strack-Zimmermann, demanded that Stegner be should not be allowed to remain a member of the oversight panel.
Yahoo
30-04-2025
- Business
- Yahoo
New German finance minister Klingbeil is champion of higher defence spending
By Maria Martinez BERLIN (Reuters) -Lars Klingbeil, Germany's next vice chancellor and finance minister, is an experienced Social Democrat lawmaker who has sat in parliament for more than 15 years, but his area of expertise has been in defence rather than finance. Now, as guardian of Germany's public finances, Klingbeil, 47, will oversee a massive expansion in defence spending after a decision of Germany's outgoing government - in the face of heavy U.S. pressure and Russia's ongoing war in Ukraine - to remove military investments from rules that cap borrowing. Germany's parliament approved in March plans for a huge spending surge which also includes a 500 billion euro ($568 billion) special fund for infrastructure, casting aside decades of fiscal conservatism in hopes of reviving economic growth. Klingbeil had long called for reform of the so-called 'debt brake', which restricts public borrowing, saying Germany was "on the completely wrong path". This contrasts with the view of his predecessor at the finance ministry, fiscal hawk Christian Lindner of the Free Democrats, whose fierce defence of the debt brake played a crucial role in the break-up of the previous SPD-led coalition. The centre-left SPD on Wednesday formally backed the new coalition led by conservative Friedrich Merz, opening the way for it to be sworn in next Tuesday. The SPD will formally nominate Klingbeil for finance minister on Monday. His SPD colleague Boris Pistorius will stay on as defence minister. Known for his charismatic personality and strong communication skills, Klingbeil is seen as a rising star within the SPD and a potential future chancellor. He has been party co-leader over the past four years with Saskia Esken. CAUTION Klingbeil played a key role in the negotiations with Merz's CDU/CSU conservative bloc in reaching the coalition agreement, but has been cautious so far in his public statements about the economy and how he will tackle his new job. "Everything is subject to financing," he said in a recent TV interview while discussing the new coalition's ambitious public spending plans. In a separate interview for newspapers of the Funke media group, Klingbeil said money must be spent "sensibly and effectively in the interests of citizens and the economy". His first major task will be to present a draft budget for 2025, which has been delayed by the snap February election in which the SPD won just 16% of the vote, behind Merz's conservatives and the far-right Alternative for Germany (AfD). The son of a soldier, Klingbeil became a member of the defence committee at the Bundestag in 2009 and witnessed the effects of underinvestment in the armed forces of his country that Merz has vowed to end in an era when Europe can no longer automatically rely on the United States' security guarantee. Klingbeil was born into a working-class family in Soltau in the state of Lower Saxony in northern Germany. He is an avid supporter of FC Bayern soccer team and played in a punk rock band "Sleeping Silence" in his youth. As a former chairman of the Young Socialists in his state, he is keen to modernise the SPD and make it more attractive to younger voters, and has focused within the party on issues such as climate change, social justice and income inequality. "I want to work as parliamentary group leader and as party leader to ensure that many young faces are also publicly visible," Klingbeil said after the February election. As well as managing Germany's state finances and continuing to co-lead his party, Klingbeil will face a further challenge in trying to blunt the increasing appeal of the anti-immigration AfD party, which he says is a "threat to democracy". ($1 = 0.8801 euros)
Reuters
30-04-2025
- Business
- Reuters
New German finance minister Klingbeil is champion of higher defence spending
Summary New finance minister to scale up military spending in Germany Klingbeil offers sharp contrast to predecessor on 'debt brake' Played key role in negotiations to form new coalition Budget for 2025 will be his first big challenge BERLIN, April 30 (Reuters) - Lars Klingbeil, Germany's next vice chancellor and finance minister, is an experienced Social Democrat lawmaker who has sat in parliament for more than 15 years, but his area of expertise has been in defence rather than finance. Now, as guardian of Germany's public finances, Klingbeil, 47, will oversee a massive expansion in defence spending after a decision of Germany's outgoing government - in the face of heavy U.S. pressure and Russia's ongoing war in Ukraine - to remove military investments from rules that cap borrowing. Germany's parliament approved in March plans for a huge spending surge which also includes a 500 billion euro ($568 billion) special fund for infrastructure, casting aside decades of fiscal conservatism in hopes of reviving economic growth. Klingbeil had long called for reform of the so-called 'debt brake', which restricts public borrowing, saying Germany was "on the completely wrong path". This contrasts with the view of his predecessor at the finance ministry, fiscal hawk Christian Lindner of the Free Democrats, whose fierce defence of the debt brake played a crucial role in the break-up of the previous SPD-led coalition. The centre-left SPD on Wednesday formally backed the new coalition led by conservative Friedrich Merz, opening the way for it to be sworn in next Tuesday. The SPD will formally nominate Klingbeil for finance minister on Monday. His SPD colleague Boris Pistorius will stay on as defence minister. Known for his charismatic personality and strong communication skills, Klingbeil is seen as a rising star within the SPD and a potential future chancellor. He has been party co-leader over the past four years with Saskia Esken. CAUTION Klingbeil played a key role in the negotiations with Merz's CDU/CSU conservative bloc in reaching the coalition agreement, but has been cautious so far in his public statements about the economy and how he will tackle his new job. "Everything is subject to financing," he said in a recent TV interview while discussing the new coalition's ambitious public spending plans. In a separate interview for newspapers of the Funke media group, Klingbeil said money must be spent "sensibly and effectively in the interests of citizens and the economy". His first major task will be to present a draft budget for 2025, which has been delayed by the snap February election in which the SPD won just 16% of the vote, behind Merz's conservatives and the far-right Alternative for Germany (AfD). The son of a soldier, Klingbeil became a member of the defence committee at the Bundestag in 2009 and witnessed the effects of underinvestment in the armed forces of his country that Merz has vowed to end in an era when Europe can no longer automatically rely on the United States' security guarantee. Klingbeil was born into a working-class family in Soltau in the state of Lower Saxony in northern Germany. He is an avid supporter of FC Bayern soccer team and played in a punk rock band "Sleeping Silence" in his youth. As a former chairman of the Young Socialists in his state, he is keen to modernise the SPD and make it more attractive to younger voters, and has focused within the party on issues such as climate change, social justice and income inequality. "I want to work as parliamentary group leader and as party leader to ensure that many young faces are also publicly visible," Klingbeil said after the February election. As well as managing Germany's state finances and continuing to co-lead his party, Klingbeil will face a further challenge in trying to blunt the increasing appeal of the anti-immigration AfD party, which he says is a "threat to democracy". ($1 = 0.8801 euros)
Reuters
26-03-2025
- Business
- Reuters
German top court upholds reunification tax
KARLSRUHE, Germany, March 26 (Reuters) - Germany's Constitutional Court on Wednesday upheld an additional tax shouldered by certain taxpayers and many companies first introduced in the 1990s to smooth out the differences between East and West following reunification. The 'solidarity surcharge' remains in place today - albeit in a narrower form - angering economically liberal lawmakers. Last year, the surcharge, which amounts to 5.5% of income and corporation tax, contributed around 12.6 billion euros ($13.6 billion) to German government coffers. The reunification of Germany in 1990 brought with it a major economic project to bring the communist regions of the east in line with their western neighbours, a goal that by some standards has still not been reached: today, incomes are generally lower in the east and unemployment is higher. The six plaintiffs that challenged the solidarity tax in court, all members of the pro-business Free Democrats (FDP), say it violates the constitution because the 'solidarity pact' that it was part of, designed to split the costs of reunification, expired in 2019. They also take issue with the fact that since 2021 some 90% of taxpayers have been exempt, which they consider a violation of the principle of equal treatment. ($1 = 0.9243 euros)
Yahoo
05-03-2025
- Business
- Yahoo
Germany to ease government debt limits to boost economy and defence spending
The two political parties expected to form the next German government have agreed to loosen the country's constitutional restrictions on borrowing, enabling €1 trillion or more in spending on defence and infrastructure. It's a major change in Germany's debt-averse political culture. Intensifying debate over the debt brake throws into question the economic wisdom that has dominated Europe's biggest economy and one of the world's wealthiest countries. Germany's recent economic malaise has nonetheless fuelled calls for reform. Here are key facts about the debt brake and what the changes will mean for Germany and Europe. The debt brake was passed in 2009, when the global financial crisis led to a sharp increase in government borrowing in Germany and around the world. The debt brake also reflected cultural and political scepticism about debt in general that for years left a deep imprint on German politics. The debt brake limited new borrowing to 0.35% of gross domestic product - a tight limit when compared to European Union budget rules requiring less than 3%, and the 2024 US federal deficit of 6.4%. The debt brake appeared to work fine for years - until it didn't. German governments lived within the limits during the good times in the 2010s, often running small surpluses. But the pandemic, slowing growth and Russia's invasion of Ukraine put the debt brake under severe strain. The government had to invoke an emergency clause to borrow and spend more on pandemic relief for businesses in 2020. Then it declared another emergency in 2021, and another one in 2022 after Russia's invasion of Ukraine raised pressure for more defence spending and relief for utility customers. Yet another emergency exemption was used in 2023. However, in late 2023 the Federal Constitutional Court ruled the government had gone too far in fudging the debt limit, forcing a frantic rewrite of the 2024 budget. Then Social Democrat Chancellor Olaf Scholz's government collapsed in November 2024 over a disagreement with a coalition party, the pro-business Free Democrats, over spending and the debt brake. The reformed debt brake would remove the constitutional ceiling when it comes to defence spending. That would support efforts to build up Germany's own defences and its ability to further support Ukraine. Germany is already a leading backer of Ukraine, sending 60 Leopard tanks and 175 Marder infantry fighting vehicles as well as 27 air defence systems, including three of its US-made Patriot missile batteries. 'The extra room for defence spending sends a clear signal to Vladimir Putin and Donald Trump as well as to Germany's European friends that Germany is serious about defending itself and helping Ukraine,' said Holger Schmieding, chief economist at Berenberg bank. 'Germany is finally taking on the leadership role which, given its size and its fiscal space, it should have assumed years ago.' Leaders of the conservative Union bloc agreed with the centre-left Social Democrats to exempt military spending over 1% of GDP from the debt limit, as well as a €500 billion infrastructure fund for civil and disaster protection, transport infrastructure, hospitals, energy infrastructure, education, scientific research and digitisation. Economists estimate that the measure, if passed, could enable a trillion euros in new borrowing and spending over a decade. The agreement came during talks aimed at forming a coalition government between the two parties. It was a sharp turnaround for Friedrich Merz, who as Union leader is the likely next chancellor after his party came in first in national elections on 23 February. His party program rejected changes to the debt brake, though he had indicated he might be open to negotiation on that point. The move 'follows the old political principle: if the facts change, I change my mind,' said Carsten Brzeski, global chief of macro at ING bank. The agreement reflects both long-term strains on the debt brake, and the sudden recent shift in US security policy under US President Donald Trump, who has demanded that Europe do more for its own security, disrupting the post-World War II transatlantic alliance under which Europe looked to the US as an ultimate security guarantor. Trump's public disparagement of Ukrainian President Volodymyr Zelenskyy in the Oval Office and the decision to suspend military aid to Ukraine have forced European governments to boost their defence spending to fill the gap left by the US - which is seen as no longer committed to Europe's security. Germany only met the NATO requirement to spend 2% of GDP on defence through a €100bn special fund exempted from the debt brake in 2022 - but that fund will run out in 2027. The parties plan to rush the changes through the lame-duck parliament next week. That's because mainstream parties have a two-thirds majority in the old parliament - but will lose that in the new parliament due to electoral gains by the far-right Alternative for Germany and the far-left The Left party who oppose the changes. The measure would still need votes in the outgoing parliament from the environmentalist Greens, who weren't part of the coalition talks. Economists say the looser debt brake could help Germany emerge from five years of economic stagnation by increasing spending on things that promote economic activity over the long term. Skimping on infrastructure spending has been blamed for trains that don't run on time due to endless track repairs, crumbling bridges, declining educational achievement levels, and lagging adoption of renewable energy infrastructure and digital technology. The morning after the announcement, economists started tearing up old growth forecasts and raising their outlook. Morgan Stanley saw the possibility of 0.2% more GDP growth this year and 0.7% more next year. That would be welcome in an economy that shrank for the past two years. 'Everything you thought you knew about Germany's economic prospects three months ago, or even three weeks ago, should be ripped up,' said Jim Reid, research strategist at Deutsche Bank. 'This is game-changing if it goes through.' The step is a 'sea change' in German policy, said economist Schmieding. 'The infrastructure fund signals that the new government will seriously tackle key domestic deficiencies,' Schmieding said. 'I look forward to the day in the – probably still somewhat distant – future when German trains may run as fast and punctual as those in France, Switzerland or Austria.'
