Scholz and the federal budget: now comes the next debt joke



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GRAMAccording to the SPD prime minister, a Corona Soli should save the compulsory health insurance. This stems from a draft resolution for the meeting with Chancellor Angela Merkel (CDU) on Wednesday.

The federal government must verify, it says in point 10, what a stabilization of contributions financed by taxes could look like so that the “additional costs caused by the corona pandemic in the health system do not have to be unilaterally cushioned by the legally insured ”. A solidarity surcharge is mentioned as a possibility.

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The likelihood that this proposal will appear in the final document on Wednesday is close to zero. The Union was amazed. “We strongly reject such a solidarity surcharge,” said Andreas Jung, deputy chairman of the CDU / CSU parliamentary group in the Bundestag.

It has already been guaranteed that compulsory health insurance will be further strengthened. According to current planning, the tax subsidy for 2021 will not only increase by five billion euros, but even by almost eight billion euros.

Increase in new planned debt

But it is not only in the Union field that one should not be very excited about the advancement of the SPD Prime Minister. It is also hard to imagine that SPD chancellor candidate Olaf Scholz would want to be associated with such an irritating issue before the federal election.

I would prefer to refer to the abolition of the old solidarity surcharge for a large part of the population on January 1, 2021. The discussion about a new solidarity surcharge would only be a nuisance.

A corona solos also wouldn’t match another key statement from the Federal Minister of Finance: the state can do whatever it takes to combat the crown crisis. There is no shortage of money.

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Scholz also wants to convey this message with the revised federal budget for 2021, which members of the Bundestag will debate in the coming days. The budget titles listed at 262 pages add up to € 160 billion in additional spending.

The original version of September only foresaw a new debt of 96,000 million euros. But that was before the skyrocketing infections and the renewal of restrictions in early November.

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Disincentives and high costs

The increase in new debt expected is mainly due to bridging aid to small and medium-sized companies, which went from two billion euros to 39.5 billion euros.

“Since the Covid-19 pandemic remains very dynamic, poses great challenges for many companies and at least severely restricts their business activities, bridge III aid must be supported by adequate budgetary funds,” says the Federal Ministry of Finance’s proposal . The aid is estimated until June 2021 inclusive.

New debts not only for crown

Another ten billion euros are reserved for expenses of all kinds that can be used to combat the pandemic, just under 2.7 billion euros for the vaccine, 2.5 billion euros are allocated to the discount sale of FFP2 masks, with Another 1 billion euros the federal government is arming against defaulting on loans under the special KfW program for companies.

So far, in the event that the default guarantees that the federal government has given to the banks, only 400 million euros have been allocated. Professional sports clubs can count on 200 million euros to save the crown next year.

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Vehicle in the sun with the inscription THW.  Report to the local THW branch in Rastatt.  GES / Daily life with Corona in Rastatt May 8, 2020 GES / Daily life during the Corona crisis in Rastatt.  05/08/2020 |  Use all over the world

Not all of the debt that has been added since the budget was first drawn up in September can be attributed to the latest pandemic.

Autobahn AG will receive another 400 million euros, another 250 million euros are available for the acquisition of the Eurofighter weapons system and 50 million euros are earmarked for the future fund for the automotive industry in a first step in 2021.

Budget titles, which now have lower euro amounts than in September, are rare. This includes grants for measures to preserve and promote industrial culture.

“Well below 200,000 million euros”

The amount of the additional billion euros that will actually be needed in the coming year is another question. So far, Finance Minister Scholz has done one thing above all with the significant increase in new debt, which he wants the Bundestag to approve: he is moving forward.

A double strategy can be identified: in the first step, Scholz makes it clear for the next year that, no matter how long the pandemic lasts, the federal government will leave no one alone.

If the federal government does not use all the credit authorizations in the end, Scholz can present himself in the second step as a good housekeeper who, despite all the challenges, handles citizens’ money with care.

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New bridge assignments

This approach to budgeting is already evident this year. Through two supplementary budgets, Scholz made the Bundestag grant loans totaling 218 billion euros in the spring.

Now it is clear that you will by no means need them. In government circles, it is assumed “well below € 200 billion.” Depending on what is accounted for this year and what is accounted for next year, it could amount to a new debt of 160 billion euros from 2020. Scholz will know how to use this for himself in the election campaign.

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The Union has no choice but to support this policy. “The 70 billion euro expenditure requested by the federal government is necessary,” said Eckhardt Rehberg, budget spokesman for the CDU / CSU parliamentary group. That does not make him happy, but in view of the “continuous dynamic development of the pandemic”, more money should be available for economic aid, the labor market and the health sector.

Opposition politician Otto Fricke of the FDP fears a psychological toll in view of the lively juggling with new historically high debt figures. “You can also get used to debt,” he said. This year has shown how quickly triple-digit billions can lose their horror in politics.

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