![CDU leader Friedrich Merz welcomed his debt deal as a historic pushback against '[Vladimir] Putin’s war of aggression against Europe'. Photograph: Filip Singer/EPA](https://www.irishtimes.com/resizer/v2/LH5GSC55JBJDNU3GLFENLIAZOM.jpg?auth=ed29078eb4a836282531ff19430a8c33ff9706735cd9400ab382991c9e54f10d&smart=true&width=1024&height=683)
German MPs on Tuesday backed a record borrowing package of €500 billion for infrastructure projects over the coming decade and an effective blank cheque for defence and security spending.
As Tuesday’s Trump-Putin call increased security fears around Europe, 513 German MPs backed the plan with 207 opposed and no abstentions. A three-party alliance secured 24 votes more than 489-vote two-thirds majority required to change German debt rules, anchored in the constitution.
A final vote in favour is likely on Friday in the Bundesrat, the upper house representing Germany’s 16 federal states. Centre-right CDU leader Friedrich Merz welcomed his debt deal as a historic pushback against “[Vladimir] Putin’s war of aggression against Europe”.
“For at least a decade we’ve felt a false sense of security,” he said, requiring Germany to embrace a “paradigm shift ... to rebuild our defence capabilities, in part from scratch”.
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Mr Merz acknowledged his dramatic U-turn since winning last month’s election victory on a reform-austerity platform, adding he “understands” critics who fear massive borrowing creates huge burdens for the future.
To those in his own party who are wary of the deal – and to his likely future SPD coalition allies – Mr Merz insisted that Germany’s rising borrowing would mean higher loan and interest payments, making government spending cuts inevitable.
It remains unclear, though, what leverage Mr Merz has over the SPD – his only coalition partner option – to agree to cuts in ongoing coalition talks or the coming parliamentary term.
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SPD co-leader Lars Klingbeil described the deal – allowing record spending in many of his party’s priority areas – as “the right signal, that we in the democratic centre are able to find solutions to move our country forward”.
Ahead of the vote, three critical opposition political parties lashed out at the proposals. The far-right Alternative for Germany (AfD) accused the CDU of “damaging democratic substance” by recalling the outgoing Bundestag, elected in 2021, for the vote and not the one elected last month. Equally damaging, according to AfD parliamentary leader Bernd Baumann, was how the CDU “hustled for votes, then do the exact opposite” of recent campaign promises.
The neoliberal Free Democratic Party (FDP), ousted from the Bundestag by voters last month, used its last day in the outgoing parliament to accuse Mr Merz of “using a majority you don’t have” in the new parliament.
Departing far left leader Sahra Wagenknecht, a vocal critic of Ukraine in its war against Russian aggression, recalled the spirit of 1914 with a joke that “war loans with a green climate seal is something you couldn’t make up”.
SPD German defence minister Boris Pistorius hit back at the FDP and Wagenknecht, saying “the threat level goes before the budgetary situation”.
“We are not selling out our country’s future ... but securing it,” he added.
Düsseldorf economist Jens Südekum called the debt-borrowing deal a “very good compromise” between Germany’s likely next coalition partners. Despite the huge sums involved it remains largely unclear how the massive spending programmes will be structured let alone rolled out.
Ratings agency Fitch said the stimulus packages could “support growth and improve competitiveness”, but added they would not on their own boost currently flat German growth – and longer-term economic prospects.
Mr Merz, Germany’s likely new chancellor, has said the new parliament will devise a new law to structure the spending some time after its inaugural sitting later this month.
Likely to hear the first details was French president Emmanuel Macron, with whom the CDU leader had a late-night dinner on Tuesday evening. After a one-hour courtesy call on outgoing chancellor Olaf Scholz, the Macron-Merz talks were expected to discuss prospects of a Ukraine ceasefire and speculation of French deployment of nuclear-equipped bombers and submarines on German territory.
