Coalition: Who wants what in the traffic light budget dispute?

They still don’t agree. It was just five and a half weeks ago that the three leading figures in the traffic light coalition government announced that the budget for next year was in place. But it has long been clear that not everything that was envisaged will work. There is still a funding gap of five billion euros. And so they are negotiating again: Chancellor Olaf Scholz, his finance minister Christian Lindner and Vice Chancellor Robert Habeck – not all night long in the Chancellery, but via video links from vacation. Telephone diplomacy, traffic light style.

Actually, it is a manageable sum. With a total budget of 480 billion euros, five billion is unlikely to make much of a difference. But the truth is that most of the money is tied up in legal obligations, and there is not much scope for setting one’s own priorities. But the traffic light coalition’s dispute has long been about more than just the 2025 budget and the fundamental direction of financial policy between saving and taking on debt. It is also about who is right and who gives in, so shortly before the next federal election.

Scholz and Lindner in particular, who at the beginning of their term in government were surprisingly on good terms, are at odds. The draft budget is to be sent to the Bundestag on Friday. But according to those close to them, there has been no rapprochement so far. Instead, there have been disagreements because Lindner rushed ahead with the classification of two legal opinions – and Scholz publicly called him back in an unprecedented way. Since then, at the latest, the question has been: who actually wants what in these budget negotiations?

The Chancellor: Fan of unusual ideas

Even as finance minister, SPD politician Scholz was known for suddenly coming up with an unusual idea in seemingly hopeless situations. Thinking outside the box worked well with EU aid during the Corona pandemic. But it also went wrong: Last year, the Constitutional Court rejected the idea of ​​repurposing billions in Corona loans for climate protection. The ruling plunged the traffic light coalition into a serious budget crisis – although Scholz repeatedly made it clear that he actually cannot understand the judge’s ruling.

The Chancellor is now saying, “It’s possible.” He is referring to plans to support the railway and the motorway company financially in such a way that it is not counted towards the debt brake. Legal experts believe that this would be difficult to implement, if at all – but Scholz finds it difficult to back down from an opinion once he has expressed it. “It’s possible somehow,” is how one could also understand his words.

The Chancellor is being driven in the negotiations by his parliamentary group. Not only is the party under pressure to meet deadlines, parliamentary group leader Rolf Mützenich is also repeating his mantra-like demand to take on more debt because of the war in Ukraine. Cuts in social spending are taboo for the SPD. A lot of anger has built up, which is primarily directed against Lindner, but is putting the Chancellor in a difficult position.

The Finance Minister: Guardian of the debt brake

For FDP leader Lindner, another exception to the debt brake would probably be the biggest possible defeat. He justifies his rejection with the interest that would have to be paid over the years. At the same time, however, the debt brake is also one of the most important election campaign issues for his FDP, which is fighting for political survival.

What Lindner also makes very clear is that his budget must be legally sound. He once agreed to the ideas of the SPD-led Chancellery and was given a slap in the face by the Constitutional Court. “That won’t happen to me a second time,” the FDP man stressed in a summer interview with ZDF. If there is even the slightest legal doubt, Lindner wants to pull the ripcord.

However, he has not yet publicly presented any real proposals for a solution. The fact that he brought the coalition leaders into the budget talks, which a finance minister normally conducts alone, is interpreted by some in the traffic light coalition as a lack of assertiveness. Others accuse him of shirking responsibility.

The Vice Chancellor: Head-shaking spectator

The third member of the group, Vice Chancellor Habeck, seems to be largely staying out of the dispute. At first he remained silent for a long time, then he was extremely irritated by the communication behavior of the others. The last fourteen days had been “unnecessary,” he said at an appointment in Bremen. “People expect the government to do its job, not to talk about why the work is difficult.” Habeck seems to be aware that he has little to gain on the budget issue. For his Greens, the most important thing is that there are no significant cuts to climate projects. The draft budget must be submitted to the Bundestag by the end of the week. “And I am optimistic, just as I am always optimistic overall, that this will work.”

Otherwise, disillusionment seems to prevail: the Greens want to invest much more and take out loans to do so. But they also see that this will not work in the current coalition. Habeck prefers to save the controversial issue of the debt brake for the election campaign, which he will probably lead next year as the Greens’ candidate for chancellor.