Press review: Ruling from Karlsruhe puts the traffic light in trouble

The Federal Constitutional Court has assessed the use of Corona loans for climate projects as unconstitutional, forcing the traffic light coalition to temporarily put planned projects on hold. The Union, which sued in Karlsruhe against the change to the second supplementary budget for 2021, sees the government in a shambles. The environmental protection organization Greenpeace spoke of a bitter setback for climate protection.

The decision of the highest German court relates to the 2021 budget. Due to the emergency situation during the corona pandemic, the federal government increased the budget by 60 billion euros through loan authorization. In such exceptional situations, as in the case of natural disasters, it is possible to take out loans despite the debt brake.

Karlsruhe accepts traffic light budget trick

In the end, the money was not needed to deal with the pandemic and its consequences. The federal government made up of the SPD, Greens and FDP therefore wanted to use the 60 billion for the so-called Climate and Transformation Fund (KTF) and, with the approval of the Bundestag, redeployed the money retroactively – but only in 2022.

The court now made it clear that there must be a connection between the exceptional emergency situation and the financed measures. In principle, the legislature has leeway. The longer the crisis lasts, the greater the requirements for justifying why certain measures should be used to solve it, according to the 64-page judgment.

This is how the German newspapers commented on the verdict:

“New Osnabrücker Zeitung”: “For the moment, the situation is a mess: tax increases would be a breach of their election promise for the Liberals. Cuts in the planned climate protection measures would be a fiasco for the Greens. And cuts in the social sector are out of the question for the SPD. So far, the traffic light coalition has had its differences Ingenuity when spending money can be masked. Karlsruhe has now blocked this path. For citizens, this means: They have to be prepared for cuts. The verdict is a disaster for the transformation of the already weak economy and climate protection. However, it is not the judge who is responsible for this, but the federal governmentwhich caused the crooked deal.”

“Rhein-Neckar newspaper”: “The fact that Olaf Scholz, who came up with the billion-dollar move as Finance Minister under Angela Merkel, has to sweep away the shambles first and foremost is a nice punch line in this trick game. Yes You shouldn’t bet on whether the traffic light coalition will immediately fail in the clean-up work. On the one hand, all three government factions are responsible for the misery. On the other hand, only the SPD has a government option outside of the current alliance – the Greens and FDP know this only too well. Nevertheless, the ruling has far-reaching consequences because without the secret influx of money, the costs of the energy transition, but also those of supporting Ukraine, only become visible. With the elimination of special debt, government policy receives a more honest price tag. And that forces the SPD, Greens and FDP to pull together. A thank you to Karlsruhe for that too.”

“Latest Baden News”: “The traffic light is in shambles. The 60 billion is gone, which means there is no money to promote the exchange of heating systems or investments in a climate-neutral economy and to ensure social balance. But that is necessary in order to achieve the ambitious climate goals To achieve this. It is not enough to simply reshuffle the budget. Rather, the entire climate and financial policy is being put to the test. And now? There is no loosening of the debt brake or tax increases with the FDP. The Greens reject any compromises in climate protection. And The SPD cannot make cuts in the social sector, which raises the question of the future of the traffic light. A new start with a new formulation of the political goals is inevitable. Otherwise, their days are numbered. The Union is in the starting blocks as a partner for the SPD.”

“Badish newspaper”: “In fact, less than two years before the next federal election, the coalition has to completely redesign its policy for climate protection and the transformation of the economy – in such a way that it is no longer built on sand, constitutionally and financially. It would be a miracle if Berlin will succeed in this herculean task in the coming months, which of course also leads to conflicts in society. This was shown in the bitter debate about Habeck’s heating law in the spring. And since then, the dissent in the traffic lights has not decreased – but the support from the people has decreased Citizens.”

“Stuttgarter Zeitung”: “The Karlsruhe judges have blocked the traffic light from the easy way to raise 60 billion euros on credit, in violation of the Basic Law. So the government only has to clarify which fund project is really important to it and how it can seriously finance it . That sounds easier than it is. Because the coalition actually has to completely redesign its policy for climate protection and the transformation of the economy – in such a way that this time it is no longer built on sand, constitutionally and financially.”

“Southwest Press”: “The coalition, which has grown tired of each other, must now reinvent itself. Most recently, the special fund called the “Climate Transformation Fund” (KTF), which has now been criticized by the Constitutional Court, appeared as a solution to all possible conflicts. The missing billions from the KTF do not yet play a major role in next year’s budget. But almost all of the self-proclaimed progress coalition’s future projects depend on this pot. The alliance may still be able to pull itself out of the disaster it has brought upon itself by introducing an austerity program and raising taxes. But that seems very unlikely at the moment. The verdict pushes the traffic light to the limits of its existence, perhaps even beyond it.”

“Leipziger Volkszeitung”: “It is a disaster for the traffic light coalition. The policy of the alliance of SPD, Greens and FDP was based on a breach of the constitution from the start. The Federal Constitutional Court determined this with great clarity on Wednesday. The postponement of unused Corona aid to the extent of 60 Billions of euros in a special fund for climate protection was unconstitutional. All partners are responsible for this: it was the current Chancellor Olaf Scholz from the SPD, who had the budget trick worked out when he was finance minister in the grand coalition. It was Christian Lindner from the FDP, who, as Federal Finance Minister, put the plan into action and even praised it as an ‘expression of creative will.’ And it is the Green Economics Minister Robert Habeck who now wants to spend the money secured in this way on climate protection measures or has already spent it. “

“Rhine Newspaper”: “Without the transfer of the 60 billion euros left over from the previous government into the climate fund, the successful conclusion of the coalition negotiations between the SPD, Greens and FDP at the end of 2021 would have been in question. Because that was simply missing for significantly more climate protection efforts, which were essential for the Greens Money. The trick of rebooking was constitutive of the traffic light, it was its starting capital. Now the coalition will inevitably face a debate about new, sensitive budget cuts and/or tax increases.”

“Kölner Stadt-Anzeiger”: “The highest German court is to be thanked for not letting the federal government get away with its presumptuous handling of the Basic Law, even if this now poses massive financial problems for the traffic light. The judges made it very clear why the action was not legal: If a federal government can “fill up” with loans in one year and then park the money in some special fund and then spend it for other purposes in the following years, then the debt brake is reduced to absurdity. It is only embarrassing for the traffic lights that she carried out the trick with the climate and investment fund in a botched manner.”