Former German Chancellor Angela Merkel has spoken out in favor of changing the rules of Germany's constitutional limit on government spending, the so-called debt brake, a highly contentious question, that is being hotly debated before early elections next year.
In her long-awaited memoirs, published on Tuesday, the former chancellor writes that while the idea behind the policy remains correct, "in order to avoid social unrest and to cope with the changes in the age structure of the population, the debt brake must be reformed to allow higher debt for future investments."
The debt limit has become a topic of intense discussion as parties gear up for their campaigns ahead of the parliamentary elections now expected in February.
The debt brake, enshrined in the Constitution in 2009, largely prohibits the federal and 16 state governments from financing their budgets with new loans.
While the regional governments are subject to an absolute ban on accruing debt, the federal government is allowed to take on net debt of only up to 0.35% of gross domestic product (GDP), outside of certain emergencies.
Merkel's comments pit her against many politicians from her conservative Christian Democrats (CDU), which along with its Bavarian sister party the Christian Social Democrats (CSU) has long insisted on adhering to the policy.
The CDU/CSU's top candidate in the election, Friedrich Merz, who is widely seen as the favorite to succeed center-left Chancellor Olaf Scholz, recently spoke cautiously about reforming the debt brake.
"Of course, it can be reformed. The question is: Why? For what purpose? What is the result of such a reform? Is the result that we spend even more money on consumption and social policy? Then the answer is no," Merz said at an economic conference organized by the Suddeutsche Zeitung newspaper in Berlin.
If the brake were to be lifted to enable investments and increase prosperity, however, Merz said the "answer could be different."
Merkel justified her position with reference to the economic challenges the country is facing to increase defense spending, maintain development cooperation and transition to climate-neutral living by 2045 among other things.
Merkel is to present her memoirs, titled "Freedom. Memories 1954 - 2021," at the Deutsches Theater in Berlin on Tuesday.
The CDU politician co-wrote her political memoirs with her long-time political adviser Beate Baumann. According to the publisher Kiepenheuer & Witsch, the book is around 700 pages long and offers "a unique insight into the inner workings of power."
