Suddenly Christian Lindner is dictating the government’s course

Wednesday afternoon, early presents in the Christmas Chancellery: Olaf Scholz, his deputy Robert Habeck and Finance Minister Christian Lindner present the agreement in the budget dispute after agonizing negotiations and a sleepless night. And Lindner? Turn off first. The cabinet, reports the Liberal, has dealt with the urgent issue of loneliness. “However, I can see that the three of us have not been affected in the last few weeks,” he says, looking down briefly as if he had to suppress a smile.

The mood is good, at least for one person.

It took the coalition leaders four weeks to clarify, after the humiliating Karlsruhe ruling on the climate fund, how a hole of 17 billion euros should be plugged in the budget for 2024 and whether this government still has a future. Scholz, Lindner and Habeck have acted in the past few days as if they were traveling with the collection. They were looking for a billion in savings potential in the budget here, a billion there, in order to somehow get to the large sum that was missing from the budget after the judge’s slap. There is now an agreement in principle. But it is unclear whether it will really bring this coalition together again. Who can be satisfied? Who has to fear being punished for the painful process?

Christian Lindner can be satisfied

Of course, Lindner also has to convey a few things to his party and parliamentary group that he would have preferred to avoid. No tax increases? Almost. There is a tax increase for farmers who need agricultural diesel. There is an indirect tax increase for everyone within Germany want to fly. And from 2024 there will be a CO tax of 45 euros per ton, five euros more than the traffic light previously planned.

Lindner can cope with the first two reforms and sell them as a reduction in climate-damaging subsidies. No new proposal, the Liberals have already set their sights on this goal Coalition agreement obligated. The higher CO2 tax and the resulting rising fuel prices may certainly annoy the hum-hum wing in the FDP, but Lindner can still sell it as a success: more climate protection through price signals, not through bans.

There would still be the matter of the emergency. A term that Scholz and Habeck didn’t even say it – probably out of consideration for the finance minister and his party, who didn’t want exactly this exception for 2024. That alone is a small victory for Lindner, who adamantly avoided the term at a recent press conference.

The emergency is like pregnancy

In the meantime, the Chancellor may have taken another look at the Basic Law to see exactly what it says in Article 115 on the debt brake. Accordingly, in emergency situations, “credit limits can be exceeded based on a decision by the majority of the members of the Bundestag”. From this, Scholz has, it seems, formed a new word for the process that simple minds simply understand as “determining the emergency”: The Chancellor now prefers to speak of an “exceeding decision”.

Scholz now plans to make exactly this decision for the coming year in order to be able to provide the victims of the Ahrtal flood with further aid amounting to 2.7 billion euros. And with such a decision to exceed the limit, aka emergency situation, it’s like a pregnancy. Either you determine the condition – or you don’t. In fact, the state would still be borrowing more money in 2024 than the debt brake actually provides for. In concrete terms, however, it is only about 2.7 billion euros. With a budget totaling around 450 billion, that’s peanuts.

At the press conference, the finance minister was not entirely clear about this. One could understand Lindner as if he was still checking whether this step was absolutely necessary in a narrow emergency. Or, as if he didn’t want to let other debt seekers accuse him of this extra sum: Don’t worry about it! If FDP politicians are now cheering that no emergency will be declared in 2024, that is a bit of a lie. However, the underlying spin – Lindner provides solid finances – will probably prevail.

Robert Habeck is fleeced

If the actual great communicator of the traffic light, Economics Minister Robert Habeck, loses himself in bulleted sentences and, for once, in the course of his explanations, no story emerges that gives the whole undertaking a deeper meaning, then this is probably due to two reasons: He himself doesn’t really know what he should believe in this agreement. Because apart from the fact that the mere fact of the agreement somehow keeps the traffic light alive, things – reason number two – not only went well for Habeck, but also partly at his expense.

Of course, it was not to be expected that “his” climate and transformation fund would get away unscathed – especially since the whole mess with the budget arose not least because the Karlsruhe judges shrank this fund by 60 billion euros. But twelve billion euros is not small change. That’s how much less is expected to flow from the fund next year alone. 46 billion will be cut over the next four years. The solar industry is the first to be hit; the funding for electric cars is also running out. But the chip factories should continue to receive billions?

Bitter.

Nevertheless, Habeck is likely to appear in front of his family with his head held somewhat high, even if not all the details are known yet: less because he protected the promised heat pump funding from the lawn mower, but rather because he was able to bring the Greens at least a small trophy – entry into the system Reduction of climate-damaging subsidies: a tax on aviation fuel for domestic flights and an end to the diesel privilege for farmers. In addition, Habeck seems to have saved, at least for the time being, the basic child welfare system that was so vehemently demanded by the Greens and so vehemently rejected by the Liberals.

Licking wounds at the SPD

How the comrades celebrated their Chancellor. For his clear words, his clear attitude. And his promise: “In such a situation there will be no dismantling of the welfare state in Germany,” said Scholz at the SPD party conference with a view to the budget crisis. That was on Saturday. And now?

Now the comrades have to accept that there will also be savings of 1.5 billion euros in the welfare state. Through “more accuracy,” as Finance Minister Lindner said. For example, refugees from Ukraine should be better and more quickly integrated into the labor market, explained the FDP leader. No further details are known yet.

But an agreement has been reached, somehow – that seems to be the most important thing after the long wrangling. “It’s good that an agreement was possible and that the government is taking the situation seriously and finding solutions,” said SPD member of the Bundestag Sebastian Roloff star. He is glad that there are no comprehensive social cuts; Roloff sees the reduction of climate-damaging subsidies as positive. “However, the already agreed climate money is needed more than ever with a view to social balance,” demanded Roloff, who is also a member of the party executive committee. And some questions remain unanswered when it comes to supporting e-mobility. “If we are honest, it remains the same: there is no future with this debt brake,” says Roloff.

Yes, this debt brake. The agreement between the traffic light leaders is likely to cause discussions in the SPD. At their party conference, the comrades decided to declare an emergency for 2024 and to repeatedly relax the debt rules. This should prevent smears of any kind. Nothing will come of this for now. Instead, the focus is on saving and reallocating in order to scrape together the missing billions in the 2024 budget.

What can I say? Many comrades probably don’t really know that yet. Some form of formulation aid is circulating in the Chancellor’s party as to how the budget agreement should be assessed. It also refers to the party conference at the weekend, where a “clear line was given” as to what the budget had to achieve: the modernization of the country, no threat to social cohesion and continued support for Ukraine. “These requirements of the SPD have been implemented in the agreement,” says the internal paper, which is available to the star is present.

It is also emphasized that there will be no dismantling of the welfare state. And yet the paper admits: “Cuts in the individual budget titles are painful for the SPD.” All of this was made necessary not only by the Karlsruhe judge’s ruling, “but above all by rigid debt brake rules” that no longer fit the times and would “unnecessarily slow down” the country.

However, a comprehensive reform of the rule has become anything but more likely today.