Why a Debt Brake Makes Sense

The high level of public debt in Germany – caused by crises, but ultimately also by a reckless spending policy in times of high tax revenue – has led to a debate on the abolition of the debt brake. Robert Fenge, University of Rostock, discusses various welfare economic arguments that have been put forward in favor of abolition. However, a key argument in favor of the debt brake stems from the experience gained with debt policy in recent decades.