Germany’s Bundesrat, the second chamber of parliament, has approved a significant spending package aimed at investing billions of euros in defense, infrastructure, and climate protection. This approval comes after lawmakers recently passed a historic amendment to the constitution, allowing for unprecedented government spending levels. The reform required the Bundesrat’s nod, representing Germany’s 16 federal states, with a two-thirds majority vote. Despite initial objections from smaller parties within state coalition governments, particularly from Bavaria’s “Free Voters,” the reform eventually succeeded, clearing the last major hurdle for debt reform.

This vote enables massive spending from Europe’s biggest economy under the new debt reform plan that exempts defense spending from Germany’s so-called “debt brake,” which restricts government borrowing. The plan also includes a special €500 billion infrastructure investment fund. Initiated by the Christian Democratic Union (CDU) and the Social Democrats (SPD), the reform aims to accelerate its passage through the outgoing parliament. There were concerns it might be blocked in the new parliament due to the increased representation of far-left and far-right lawmakers who oppose the plan.

Germany’s intention to reform its debt rules is linked to its strategic defense priorities. CDU leader Friedrich Merz, set to become Germany’s next chancellor, views this as a critical step towards independence from the USA. With the CDU leading in the general election, Merz has emphasized the need to bolster European defense capabilities swiftly, responding to shifts in transatlantic relations under former U.S. President Donald Trump.

Source: https://www.dw.com/en/germany-upper-house-signs-off-on-landmark-debt-reform-plan/a-71992709?maca=en-rss-en-all-1573-rdf