[4] The amendment was enacted because the nation's debt-to-GDP ratio exceeded the 60% threshold fixed in the Maastricht Treaty, primarily a result of the heavy payments to reconstruct former communist Eastern Germany after reunification and a loss of tax revenue during the Great Recession.
[11] In 2022, the government, led by Chancellor Olaf Scholz, succeeded in obtaining the two-thirds majority necessary to amend the debt ceiling to allow Germany to establish a 100 billion euro defense fund that would not be subject to the restrictions.
The ruling prompted a discussion about whether the amendment in its current form would still be appropriate, with even some conservatives calling for a reform to raise the relatively weak level of investment, compared to European neighbors, which had prevailed for several years.
Moreover, some contend that the strict austerity measures enforced by the debt brake hinderes long-term growth prospects by causing underinvesting in infrastructure, education, and innovation.
The German Council of Economic Experts (GCEE) has advocated for a pragmatic reform aimed at enhancing the flexibility of fiscal policy while safeguarding debt sustainability.
They argue that reducing government borrowing fosters economic stability, encourages private sector investment, and ultimately strengthens Germany's position within the European Union.
Also, the FDP advocates for structural reforms aimed at enhancing Germany's economic competitiveness and productivity, viewing them as essential for achieving sustainable budgetary outcomes in the long run.
However, other more left-leaning parts of the party criticize its firm framework and argue that it negatively influences the government's ability to respond effectively to economic downturns or invest in green technologies and welfare programs.
While the party recognizes the importance of sustainable fiscal policy, it raises concerns about the social and environmental implications of austerity measures enforced by the debt brake.
[22][23] In 2024, Danyal Bayaz, Minister of Finance of Baden-Württemberg, criticized the federal German government for squandering the “globalisation dividend” of the past 15 years by failing to make public investment during a period of low interest rates.
[24] The Left Party (Die Linke) opposes the debt brake altogether, viewing it as a neoliberal austerity measure that undermines social welfare and intensifies inequality.
They argue that austerity measures enforced by the debt brake disproportionately impact marginalised communities and slow down efforts to achieve inclusive and sustainable economic development.