Germany's main industry lobby group has sounded the alarm over the tax cutting plans of chancellor Angela Merkel's new government, warning that priority should be given instead to bringing the country's spiralling deficit back under control.The comments on Sunday by the president of the BDI business association highlight growing concern that the centre-right coalition in Berlin will jeopardise Germany's reputation for fiscal prudence by pushing ahead with sweeping tax cuts.They followed veiled warnings from the European Central Bank and Germany's Bundesbank that excessively expansionary policies could backfire and that European Union fiscal rules be upheld. Central bankers fear breaches of fiscal rules would send a disastrous signal to other eurozone countries.
The comments on Sunday by the president of the BDI business association highlight growing concern that the centre-right coalition in Berlin will jeopardise Germany's reputation for fiscal prudence by pushing ahead with sweeping tax cuts.
They followed veiled warnings from the European Central Bank and Germany's Bundesbank that excessively expansionary policies could backfire and that European Union fiscal rules be upheld. Central bankers fear breaches of fiscal rules would send a disastrous signal to other eurozone countries.
What's up with all the angst over borrowing? In America they think (thought) it's a gift from God, while in Germany they think it's the touch of the Devil. Why not a little borrowing, mainly for investment, more when the economy is depressed and less when it is buoyant? The amount of borrowing should be... lagom. Peak oil is not an energy crisis. It is a liquid fuel crisis.
