Federal Finance Minister Christian Lindner (FDP) presented his financial policy strategy for the coming years on Thursday. The 22-page paper entitled “Fiscal policy at a turning point – strengthening growth and avoiding inflationary impulses” revolves around three main points: short-term stabilization in the current crisis, a growth-oriented supply policy and finally fiscal resilience, i.e. the ability to withstand future crises.
Lindner warned of the increasing risk of stagflation – in other words: the simultaneity of stagnating growth and rising prices. This “drastically changed macroeconomic environment” also means a turning point for financial and budgetary policy, he said, referring to the “turning point” in security policy that Chancellor Olaf Scholz (SPD) had proclaimed in response to the Ukraine war. According to Lindner, the right answer to the changed situation can be found in the financial strategy that is now available.
Above all, it says, it must be about “increasing growth without creating additional price pressure”. The first cornerstone of the strategy should be a “powerful and resolute reaction to the increased uncertainty in the crisis”, the second an “unleashing” of market forces for self-sustaining growth – through good economic conditions, not through more government Demand. Examples include faster approval procedures, public investment in innovation, education and infrastructure, and an open immigration policy for more skilled workers. The third pillar should be the return to solid state finances in order to counteract the risk of inflation and in view of the turnaround in interest rates that has already started.
At the presentation, it became clear that Lindner also wants to use his financial strategy as a kind of stop sign against overly immodest spending requests within the government. He spoke of a “guideline for financial and budgetary policy in the near future”. She will also guide him in preparing the 2023 budget and on her basis priorities should be set for the planned coalition projects. A formal cabinet decision on the strategy is not planned. But Lindner definitely wants to have a “discussion” with his colleagues.