“An economy operating at full capacity can only invest more in armaments and infrastructure if it produces less of other goods. More public debt will not alter this. In the next ten years, the barely operational German armed forces and the dilapidated public infrastructure will receive the enormous sum of more than 1,000 billion euros. The government should finance such core tasks not with new debt but by cutting spending or by raising taxes. Investment in armaments and infrastructure would then come at the expense of public or private consumption. If armaments and infrastructure are financed on credit, … However, German politicians are reluctant to prioritize spending. They prefer to maintain the illusion that it is possible to invest more in investment in armaments and infrastructure without cutting spending in other areas. That is why they want to finance both almost entirely on credit – the infrastructure through an off-budget vehicle (“special fund”) and the armament by exempting defense spending above one percent of GDP from the constitutional debt brake.”
Morten W. Langer
