How should the enormous investments in sustainable infrastructure be financed? Baden-Württemberg’s Green Prime Minister has an idea for this.
Baden-Württemberg’s Prime Minister Winfried Kretschmann is calling for special funds for urgently needed investments in infrastructure. “We need the possibility of building up a special fund through loans that can only be used for very specific investment purposes,” the Green politician told the German Press Agency in Stuttgart. Kretschmann cited the construction of a hydrogen network as an example, which must be addressed urgently.
Kretschmann cited the railway as another example. “The traffic light coalition has inherited an enormous backlog of repairs because no investment has been made for decades. This cannot simply be resolved in one budget,” the Prime Minister told dpa. Nevertheless, there is a need to invest heavily in this area – otherwise there is a risk of burdening future generations simply because they do not want to bear them at the moment.
Kretschmann explained the hydrogen network: “We have almost no green hydrogen today, that is still a thing of the future. But there is no doubt that it will come. Then you will need these networks and anyone who does not have them will immediately run into enormous competition problems,” said Kretschmann. But because there will only be relevant quantities of green hydrogen in ten years, there will be no returns from investments in the network until then. “For this we need the opportunity to take out loans that can be repaid over a relatively long period of time.”
Kretschmann said he was not at all in favor of loosening the debt brake in general. It was an important achievement and was intended to protect future generations from excessive debt and interest burdens. “But the debt brake must not become a brake on the future. If important investments are not made, this will also harm the next generation,” said the Green politician.
The debt brake was enshrined in the Basic Law in 2009 after the global financial crisis. According to this, the federal and state governments are no longer allowed to balance their budget deficits by taking out loans.
Source: Stern
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