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Prof. Dr. Christoph Gröpl Lehrstuhl für Staats- und Verwaltungsrecht The new German Debt Brake a constitutional attempt to restrain state indebtedness.

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Presentation on theme: "Prof. Dr. Christoph Gröpl Lehrstuhl für Staats- und Verwaltungsrecht The new German Debt Brake a constitutional attempt to restrain state indebtedness."— Presentation transcript:

1 Prof. Dr. Christoph Gröpl Lehrstuhl für Staats- und Verwaltungsrecht The new German Debt Brake a constitutional attempt to restrain state indebtedness

2 Prof. Dr. Christoph Gröpl · Debt Brake 22 Israel public debt: 54 bn ( $ 78 bn) Debt Brake 7,000 per capita population: 7.6 m Germany public debt: 2,000 bn ( $ 2,908 bn) population: 82 m 24,000 per capita

3 Prof. Dr. Christoph Gröpl · Debt Brake 33 Hierarchy of Norms (national level) Constitution Debt Brake other acts of State Parliamentary Acts

4 Prof. Dr. Christoph Gröpl · Debt Brake 44 Art. 115 par. 1 Basic Law (version 1969) […] Revenue obtained by borrowing shall not exceed the total of investment expenditures provided for in the budget… Debt Brake … exceptions shall be permissible to avert a disturbance of the overall economic equilibrium. FCC:wide range of discretion for the budgetary legislator

5 Prof. Dr. Christoph Gröpl · Debt Brake 55 Art. 126 par. 1 TFEU (Lisbon version 2009) annual deficit limited to 3% GDP Debt Brake overall debt restrained to 60% GDP Problem: lack of enforcement

6 Prof. Dr. Christoph Gröpl · Debt Brake 66 Art. 109 par. 3 Basic Law (version 2009) The budgets of the Bund and the Länder shall in principle be balanced without revenues from credits. Debt Brake (applicability: 2016 [Bund], 2020 [Länder]) Exceptions: deficits in times of downswing to balance the effects of market developments that deviate from normal conditions unusual emergency situations beyond governmental control and substantially harmful to the states financial capacity

7 Prof. Dr. Christoph Gröpl · Debt Brake 7 Thank you for your attention!


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