Wrestling over the Economy: Early Elections Put German Parties under Pressure

Following the surprising vote of no confidence against Chancellor Olaf Scholz's government, Germany's leading parties are under intense pressure to present their programs for the upcoming new elections. At the center of the debate is the future of Europe's largest economy, which has been lagging behind expectations for some time. A further economic decline is expected in 2024, a major concern for voters. The SPD, led by Olaf Scholz, aims to encourage private investments and modernize infrastructure with a 100 billion euro fund. Additionally, the party plans a "Made in Germany" premium to boost investments and the purchase of electric vehicles. A moderate reform of the debt brake is also on the agenda, though its concrete implementation remains unclear. Meanwhile, the CDU/CSU focuses on comprehensive tax relief and lower electricity costs, but fails to provide an answer on financing these measures. Friedrich Merz, the potential next Chancellor, supports maintaining the debt brake but shows a certain flexibility for moderate adjustments. Bündnis 90/Die Grünen with Chancellor candidate Robert Habeck aims for a reform of the debt brake to allow for higher public spending. Their concept of a "Citizen Fund" to strengthen the pension system is designed to consider sustainability criteria and align with the Paris Climate Agreement. They also seek a tax reduction for low and middle-income earners on electric vehicle purchases and an increase in the minimum wage. The FDP emphasizes its role as guardian of the debt brake and calls for tax relief and an end to the "solidarity surcharge." New regulations are to be halted, while they simultaneously criticize ambitious climate targets. The AfD is pushing for "Dexit," Germany's exit from the EU, and the reintroduction of the Deutsche Mark. The party remains committed to maintaining the debt brake and wants to cut spending on climate protection and international contributions. However, cooperation with other parties in future coalitions remains ruled out.