Anyone who talks to members of the government these days always hears one question: Is that enough? Rarely in the history of the Federal Republic has the Bundestag experienced such a day of decisions, all of which are somehow related to what Chancellor Olaf Scholz (SPD) called the turning point. Everyone feels like they are on a hamster wheel because of the pressure to make decisions, complaining that there is not enough time to think. Actually, one would have to go to a retreat for two days in order to think through coherent measures against the high price increases. The decisions may not have been the last – but a lot now depends on a central FDP promise.
The day begins with the fulfillment of one of the SPD’s key election campaign promises – Chancellor Scholz based his campaign of respect on this. So that no one forgets who has the copyright on it, the SPD first invited people to a photo session on Friday morning at 8.30 a.m. before the start of the meeting – at an elite US university, Angela Merkel was once recognized as the mother of the statutory minimum wage introduced in 2015.
And so well over a hundred SPD MPs were grouped on the steps by the Spree around a huge red twelve and a euro sign. Ironically, Kevin Kühnert came a little too late. Federal Labor Minister Hubertus Heil (SPD), described by Scholz as a Lower Saxony “war horse”, was in the front row.
Hubertus Heil implemented this in an urgent procedure, he is the only minister who has remained in the same office – and is accordingly considered a “safe bank” in these uncertain times, as one from the SPD parliamentary group puts it. Heil emphasizes that anyone who has previously received 1,700 euros from a full-time position paid with minimum wage will earn 2,100 euros from October thanks to the increase to 12 euros.
This is a noticeable improvement for many people in view of the current price increases. He emphasizes that around six million people would benefit from the increase in the minimum wage, especially women and employees in eastern Germany. At the same time, the limit for mini-jobs will rise from 450 to 520 euros in October.
After the one-time, unscheduled increase, the minimum wage commission made up of employers and employees will again be responsible for setting the lower wage limit. More than 12 euros will probably be available from January 1, 2024. The Union has put the project in an awkward position.
Due to the highest inflation in 50 years with an increase of almost eight percent compared to the previous year, the real increase is no longer as large as it was indicated in the election campaign. And the Union has recognized that it has lost its core brand of the social market economy and must revive it, also as a lesson from the SPD’s success. But although she now supports the amount of twelve euros, she did not vote for it, but abstained.
The CDU social politician and deputy parliamentary group leader Hermann Gröhe justified this with the disempowerment of the minimum wage commission. You will not reach out for the “disenfranchisement of the social partners”. But the debate was also shaped by the question of whether the relief measures taken so far are sufficient.
The SPD MP Dagmar Schmidt emphasized: “Many have to ask themselves whether the money is still enough for fruit, the trip to grandma, the school trip.” .”
According to the “ARD Deutschlandtrend”, 47 percent of Germans are already having to restrict themselves very or severely in everyday life because of price developments.
Above all, households with low incomes (77 percent) and citizens from eastern Germany (59 percent) feel compelled to do without. And the state will not be able to compensate for the consequences in the long term, there will be a loss of prosperity.
It may sound paradoxical, but with a view to the special fund that was also approved by the Bundestag on Friday, defense politicians are asking: is that enough? Because depending on the development of the Ukraine war and the Russian threat, it is uncertain whether the equipment and equipment offensive decided by the amendment to the Basic Law with the necessary two-thirds majority of the SPD, Greens, FDP and Union (with some dissenting votes in the traffic light coalition). will do. But Chancellor Olaf Scholz has the central turning point project under wraps for the time being, the week was one of the better ones for him.
The Union has enforced that the money is only spent on the Bundeswehr. 60 transport helicopters from the US manufacturer Boeing are to be purchased for five billion euros alone. Defense Minister Christine Lambrecht (SPD) has ordered the procurement of the CH-47F Chinook model in the version with aerial refueling capability.
However, the economic plan for spending the billions also shows that they can be gone quickly. F-35 fighter jets are also bought in the USA as successors to the outdated Tornados; they can be armed with US nuclear weapons stored in Germany; with around 40 billion euros, the largest part is planned for air projects.
Five P-8 Poseidon maritime reconnaissance aircraft are to be purchased for the Navy. Another large part of the money – around 20 billion goes into the renewal and digitization of communication; the satellite communication SATCOMBw is also being expanded. It is still unclear whether an air defense system could also be up for debate for cities like Berlin.
The Bundeswehr will become “the largest conventional army in the European NATO system,” promises Scholz. However, the special fund is counted towards the defense budget – once it has been used up, the agreed target of two percent of defense spending in relation to gross domestic product must be achieved through the budget alone – that would currently be 70 billion euros – the defense budget has around 50 billion in the current year.
If you calculate with the difference of 20 billion, the special fund would be used up in five years. Where the additional approximately 20 billion euros will come from is a completely open question so far, because of the constraints of the debt brake there would have to be significant cuts elsewhere, for example in social spending.
The first complete federal budget of the traffic light coalition, which was also decided on Friday, forms the overall framework for all measures. First of all, the Bundestag put the debt cap on for the third year in a row. With the chancellor majority of the SPD, Greens and FDP, the debt brake anchored in the Basic Law was suspended again in order to be able to incur additional debts of almost 139 billion euros for 2022.
The borrowing permitted under the debt brake (0.35 percent of gross domestic product) is thus exceeded by around 115.7 billion euros. The Basic Law allows this in one
“extraordinary emergency situation”. This is justified with the management of the corona pandemic and the consequences of the Ukraine war. After all, the Chancellery saves a lot by giving up some responsibilities, for example in the area of digital policy.
3.697 billion euros are estimated, compared to around 4.647 billion in the previous year, i.e. almost one billion less. But new cost risks are, for example, the planned extension for the Chancellery. Thanks to the reduced expenditure for short-time work, for example, almost five billion can be saved in the largest item in the federal budget – labor and social affairs – while other areas such as defense are significantly increasing in expenditure.
The shifts are also an expression of the turning point. In the individual plan of the Federal Ministry of Labor and Social Affairs, expenditures of around 160 billion euros are now planned, which accounts for 35 percent of the total expenditure of the federal budget. But here, too, the question “Is that enough” or rather: “Can it work” hovers over everything?
What is meant is the radical cure planned by Finance Minister Christian Lindner, despite all the inflation risks and uncertainties, this week he declared compliance with the debt brake from 2023 to be “non-negotiable”.
Some fear that this could break up the coalition. “The wallet determines the mood,” emphasizes the demoscope and “Insa” boss Hermann Binkert. “The SPD’s clientele in particular, the so-called little people, expect further relief from the government. Expensive spending programs such as the climate money demanded by Labor Minister Hubertus Heil are unlikely to be feasible with Finance Minister Lindner’s FDP.” He sees difficult times ahead for the traffic light coalition.