CDU/CSU and SPD want to enable billions in loans

Both resolutions are still to be passed by the old Bundestag due to the complicated majority situation. Even there, the CDU/CSU and SPD do not have the two-thirds majority required to amend the Basic Law. They therefore need votes from the Greens or the FDP.

"In view of the threats to our freedom and peace on our continent, whatever it takes must now also apply to our defense," said Merz. Therefore, defense spending that exceeds one percent of gross domestic product should be exempt from the debt brake.

Special fund for infrastructure to run for ten years

However, this would only be bearable if the economy were to return to a stable growth course within a very short period of time. To achieve this, the infrastructure must be improved. "The necessary funds for this cannot be financed solely from the current budgets of the federal government, the federal states and the municipalities," said Merz. The planned credit-financed special fund would run for ten years.

A special fund is a pot outside of the federal budget from which measures with a very specific purpose are financed. If it is enshrined in the Basic Law, it can also be exempted from the debt brake, which actually limits borrowing to a small amount. According to Merz, this is exactly what is now planned.

In addition, the federal states are also to be given the opportunity to take on more debt. Their debt brake, which has been particularly strict to date, is to be adapted to the somewhat more flexible federal regulation.

Due to the complicated majority situation in the new Bundestag, the CDU/CSU and SPD still want to pass the necessary amendments to the Basic Law with the old Bundestag. This is because the so-called centrist parties - i.e. the CDU/CSU, SPD and Greens - no longer have a two-thirds majority in the new parliament. The AfD and the Left Party are so strong that they could block an amendment to the Basic Law.

A resolution by the old Bundestag is theoretically still possible until the new parliament is constituted. Here too, however, the CDU/CSU and SPD cannot act alone: They need votes from either the Greens or the FDP to achieve the necessary two-thirds majority.

The FDP has so far always opposed a reform of the debt brake, so the negotiators are likely to rely primarily on the Greens.