History repeats itself, the first time as a tragedy, the second time as a farce. The opinion attributed to Karl Marx could be timely against the background of fiscal developments in the German capital and the race to the end of the deadline for the ratification of the 2023 supplementary budget, after the freezing of notional funds by the decision of the Constitutional Court. The 2024 budget is likely to be extended, with the possibility of cuts to social benefits open. Already the expenditures of all ministries are being reduced.

In the midst of debates and consultations in the Plenary of the German parliament, we spoke with German parliamentarians who lived, from different positions, the decade of the euro crisis and the deep rift in Greek-German relations. And Greece’s debt crisis may now be settled, the troika is gone and Greece is being upgraded by international rating agencies, but the memories of the austerity orders under Merkel-Schäuble remain fresh. And they are pulling out, especially as the European south watches a new fiscal crisis unfold, this time in Berlin, starring the government of Europe’s strongest economy, which appears to be improvising, causing concern in the eurozone.

How did Germany get into the fiscal crisis?

“Yes, first of all we have to admit that there is a crisis in Germany, which was caused by the decision of the Constitutional Court. But it is a crisis that we can solve.” At least this is what Stefan Seiter, a member of parliament of the Liberals and a professor of economics, estimates in his statements to DW. “The decision of the Constitutional Court, with which we must comply, tells us that we must follow fiscal sustainability and discipline. This could act as a model for the EU and the countries of the eurozone, in the sense that the application of fiscal rules, fiscal discipline leads to less public debt”, he estimates.

“We respect the decision of the Constitutional Court. So far we could declare a state of fiscal emergency for several years and now the Constitutional Court tells us that we should do this assessment every year on an annual basis. We will do it, we are working on it,” Carsten Treger, a member of parliament from the Social Democrats, told DW.

For Zeiter, however, the question of how Germany got here must be answered taking into account the successive crises of recent years, from the pandemic and the natural disaster in the Aar Valley to the war in Ukraine and the energy crisis. “The current crisis was the result of many external shocks and multiple crises” as he explains.

Mr. Schäuble made mistakes towards Greece

At the same time, several voices in southern Europe are cheering for the chaotic fiscal situation in Germany. Like recently the former Minister of Environment and Energy during the SYRIZA government, Panagiotis Lafazanis, who commented a few days ago to Bild that “the German government should impose extraordinary taxes to solve the problem”. In fact, he mockingly proposed as another solution “to sell public property, such as German islands”, referring to Bild’s exhortations in 2010 to the then “bankrupt Greeks” to sell Greek islands to repay the inconceivable debt.

“Perhaps it is an irony of history that Germany is in a similar situation today, but at the same time it shows us that it is important to have fiscal stability and a balanced budget,” commented Stefan Zeiter on the occasion of the signs of euphoria in the European south. But also Lisa Bandum, MP of the Greens and head of the Greek-German Friendship Parliamentary Group, says that she understands the joy that can emanate from the European south. “Germany presented itself several times as Europe’s teacher (…) especially Mr. Schäuble. Already since then I believed that this is wrong, and now we see that such an inelastic debt brake does not correspond to the times”, estimates Lisa Badum.

About the irony of history

“I can understand the irony and I would like to note that in the end Mr. Schäuble’s plans were not realized,” he estimates in response to a question from DW and the head of K.O. of the Left Dietmar Bartz. “We opposed them with vigor and today one can now see the important mistakes that were made and who benefited and what is the result. One can also see what was privatized and what ended up in Chinese hands (…) I consider it good that German arrogance did not work. As I said to the chancellor and the leaders of the other parties last Tuesday, Germany could use some humility.”

The austerity policy imposed on Greece during the years of the Eurocrisis was also considered “too harsh” by the Social Democrat Carsten Treger, who serves as vice president of the Greek-German Friendship Parliamentary Group. “That’s something we’ve always said and I still say it today. In Germany we have a similar situation, although the reasons that led here are different. Nevertheless, the same is true: just as Greece needed freedom to invest, so we also need freedom to invest” he observes.