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An incoming government wants to borrow much more to revamp the economy and rebuild the military. That means a change in the country’s Constitution — and its culture.
March 18, 2025, 7:52 a.m. ET
The German Parliament is set to vote on Tuesday on a plan to loosen government borrowing limits in order to spend heavily on defense and infrastructure, in an effort to offset America’s pivot away from Europe and to lift the country out of years of economic stagnation.
If the measure eventually becomes law, it will radically reorient Germany’s relationship to government debt — and, its authors hope, allow Germany to shoulder a more powerful leadership role at a critical moment for Europe.
The center of the plan is a push led by Friedrich Merz, the likely next chancellor, to relax what is colloquially known as the “debt brake,” a limit on government borrowing that Germany enshrined in its Constitution.
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That brake has reduced German debt, but it has also kept the government from investing in roads, software, bridges, tanks and other areas. Lawmakers say that spending is now urgently needed to address declining German competitiveness and shrinking American security guarantees.
Here is a quick guide to the debt brake, how Mr. Merz and his allies want to change it, and the challenges they will face.
