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Germany’s ‘Debt Brake’ Backed by Conservatives in Election Plan

A German national flag on top of the Reichstag parliament building in Berlin, Germany, on Wednesday, Nov. 13, 2024. Germany’s election campaign kicks into high gear, when German Chancellor Olaf Scholz makes his case in a public address for another term, despite polls showing voters are overwhelmingly looking for a change. Photographer: Krisztian Bocsi/Bloomberg (Krisztian Bocsi/Bloomberg)

(Bloomberg) -- Germany’s opposition conservatives said they’ll maintain the country’s constitutional borrowing limits and oppose joint European Union debt issuance if they win next year’s federal election, according to a draft platform.

“We are sticking with the Basic Law’s debt brake,” the Christian Democratic Union and the Christian Social Union said in the draft seen by Bloomberg. “Today’s debts are tomorrow’s taxes.”

That stance contrasts with comments last month by Friedrich Merz, the two-party bloc’s candidate for chancellor, that signaled openness to reforming the limit on net new borrowing, known in Germany as “debt brake.”

Polls suggest Merz is the frontrunner for the election expected to be held on Feb. 23, with a lead of more than 10 percentage points over the nationalist Alternative for Germany party and Chancellor Olaf Scholz’s Social Democrats.

The CDU-CSU draft rejects “all forms of German liability for the debts of other EU countries,” pouring cold water on possible discussions about joint European defense bonds for now. The parties also pledge to “scrutinize all expenditures, especially subsidies” and to reduce income taxes.

With Russia’s attack on Ukraine as a backdrop, the draft hints at reintroducing some kind of conscription in Germany, suggesting compulsory alternative civilian service as a possible path to recruiting more active-duty soldiers. Conscription was abolished under former Chancellor Angela Merkel, who led the CDU for almost two decades until 2018.

On immigration, the CDU-CSU draft proposes a tougher law-enforcement approach to detaining and deporting migrants who don’t have legal status in Germany. It calls for “fundamental change” in the EU’s asylum system.

©2024 Bloomberg L.P.