Friedrich Merz Considers Reforming Germany's Debt Brake

Friedrich Merz, the leader of Germany's conservative Christian Democrats (CDU), has expressed openness to reforming the debt brake, which currently limits the public deficit to 0.35% of GDP, marking a significant shift in the party's traditional stance. Merz emphasized that any changes should focus on boosting investment rather than increasing spending on consumption and welfare, questioning the rationale behind potential reforms. The debate was reignited by Berlin's conservative mayor, Kai Wegner, alongside rising pressure from CDU state premiers urging Merz to include reform plans in the party's election agenda ahead of the federal election. Merz acknowledged the complexity of the debt brake as a technical issue while hinting at the need for substantial parliamentary support to enact any changes. His remarks could have broader implications for Germany's fiscal policy and its economic landscape, especially as Merz is a leading candidate for chancellor. The internal discussions reflect a growing consensus within the CDU regarding the necessity of revisiting fiscal constraints imposed by the debt brake.