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Germany considers easing debt brake for military spending

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German lawmakers are set to vote on whether to relax the country’s strict borrowing rules to finance military spending.

The country faces increasing pressure to increase defense spending, and tensions are rising over Europe’s security and the future of US support under President Donald Trump.

Friedrich Merz, leader of the conservative CDU, which won the elections in Germany last month and is trying to form a coalition with outgoing Chancellor Olaf Scholz’s Social Democrats, has called for urgent action.

In a speech to parliament this week, Merz called on lawmakers to exempt some defense spending from the country’s strict “debt brake,” which limits new borrowing to just 0.35% of annual GDP.

“We must do something now to significantly increase our defense capabilities, and we must do it quickly and in great unity in foreign and security policy,” Merz told lawmakers.

The proposed plan includes a €500 billion fund, financed by borrowing, to invest in both defense and infrastructure over the next decade.

Economists estimate that if approved, the measure could pave the way for up to €1 trillion in new spending over the same period.

However, changes to the debt brake require a two-thirds majority in parliament, as stipulated in the constitution. Merz and Scholz’s parties have moved to pass the measure before the new parliament convenes on March 25.

Opposition parties, including the right-wing Alternative for Germany (AfD), argue that the debate should be postponed until the new parliament convenes to better reflect the will of the voters.

The AfD, which finished second in the elections, is expected to have more seats in the new parliament than in the current one.

AfD co-chair Alice Weidel accused Merz of reversing his position on the debt brake. “No other candidate for chancellor has broken so many elections promises in such a short time as you, Mr. Merz. You will go down in history as the gravedigger of the debt brake,” Weidel said.

Merz’s party, the CDU, had previously opposed changing the borrowing limit, but has since signaled its willingness to negotiate, citing the need for stronger defense spending amid growing uncertainty in Europe.

Green Party co-leader Katharina Droge also criticized Merz for previously rejecting proposals to reform the debt brake for economic and climate-related investments.

Despite the reactions, Merz argued that Germany must act quickly to strengthen its army and fulfill its NATO commitments.

“Germany must become capable of defending itself and return to the international stage as a capable partner in Europe, in NATO, and in the world,” Merz said.

The debate will continue in parliament on Tuesday, March 18, and the outcome will likely shape Germany’s fiscal and defense policies in the years to come.

EUROPE

Likud deepens ties with European right

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The “International Conference on Combating Antisemitism”, organized by Israeli Diaspora Affairs Minister Amichai Chikli in Jerusalem on March 26-27, has sparked controversy in Europe.

Chikli, who has previously fostered relationships between Israel and his Likud party with some controversial figures, has invited individuals such as Jordan Bardella, president of the French National Rally (RN) party; Marion Marechal, a French Member of the European Parliament formerly associated with RN and Reconquête!; Charlie Weimers, a Member of the European Parliament from the Sweden Democrats party; Milorad Dodik, president of the Republika Srpska in Bosnia and Herzegovina; and Hermann Tertsch, a Member of the European Parliament from the Spanish right-wing Vox party.

Following the leak of the guest list to the press, several prominent figures expected to attend from Europe announced their withdrawal. These included the Chief Rabbi of Britain, Sir Ephraim Mirvis; British politician and antisemitism advisor Lord John Mann; Goldsmiths University professor David Hirsh; French “philosopher” Bernard-Henri Levy; and the German antisemitism commissioner, Felix Klein.

Mann told The Jewish News, “The quality of some of the dissenting politicians speaking is not high enough to make me drop competing priorities.”

Hirsh made a similar statement, saying, “The UK has nothing to learn about fighting antisemitism from these characters. The agenda includes a number of far-right speakers who associate themselves with anti-democratic and anti-equality movements.”

Hirsh argued that “anti-democratic thought is fertile ground for antisemitism” and that the best way to undermine antisemitism is to “support democratic thought, movements, and states.”

Levy, a staunch defender of Israel, was scheduled to be a keynote speaker at the event. However, the French figure told Le Monde that he had informed Israeli President Isaac Herzog that he would not attend due to the “far-right” guests.

Germany’s antisemitism commissioner, Felix Klein, told Haaretz that he was unaware of the guest list when he confirmed his participation and canceled after seeing who would be speaking at the event.

Volker Beck, a former member of the Federal Assembly, also announced his non-attendance, stating on X, “If we associate ourselves with far-right forces, we discredit our common cause; this also contradicts my personal beliefs and will negatively impact our fight against antisemitism in our societies.”

European Jewish Congress (EJC) President Dr. Ariel Muzicant also sharply criticized Chikli on Tuesday. In a letter sent to The Jerusalem Post, Muzicant said, “For 80 years, we have been fighting antisemitism, Holocaust denial, and the aftermath of the Shoah.”

Muzicant pointed out that far-right parties in Europe are the biggest opponents in this fight, stating, “Many officials and leaders of these parties have supported Holocaust denial, promoted antisemitic codes and expressions, and fought against anti-Nazi laws.”

Muzicant wrote that although some far-right politicians now claim to support Israel, “The motivation of far-right politicians to come to this conference is not love for Israel or protecting Jews, but mainly to get a kosher certificate. And we, Jews or Israelis, should not be used as a kosher certificate.”

The EJC President described the conference organized by Chikli as a major problem for Jewish communities in Europe, arguing that it harms Jewish existence in the diaspora, “as if members of the Israeli government are stabbing them in the back.”

Muzicant emphasized that far-right movements in Europe often oppose liberal democracy, the rule of law, human rights, and freedom of the press.

Knesset Aliyah [the name given to Jewish immigration to Palestine] and Integration Committee Chairman Gilad Kariv (Democrats) called on Monday for the government to abandon the practice of inviting politicians from parties with what he described as “definite antisemitic roots.”

In a letter to Prime Minister Benjamin Netanyahu and Foreign Minister Gideon Sa’ar, Kariv wrote that the invitation “constitutes a deviation from the long-standing policy of Israeli governments and the Ministry of Foreign Affairs and directly contradicts the positions and policies of the representative organizations of Jewish communities in these countries and on the international stage.”

Kariv claimed, “The invitation of these representatives is particularly shocking, considering that it concerns an international conference on combating antisemitism, which is supposed to be held under the auspices of the president and the prime minister.”

Kariv argued that “inviting representatives of extremist parties with antisemitic roots undermines the foundations of Israel, the Jewish people, and the international fight against antisemitism,” adding, “It damages the fabric of relations between the State of Israel and Jewish communities in the diaspora and may harm Israel’s strategic relations with Western allies and leading political parties.”

Kariv added, “This step weakens Israel’s leading role in the global fight against antisemitism and represents a disturbing and dangerous regression to the current and future challenges of the Jewish people, as well as many Jewish communities around the world.”

Kariv argued that even though these parties express support for Israel, they should still not be given “an international stamp of approval.”

Chikli’s open support for the European “far-right” is receiving condemnation from European countries.

In December, Romania’s Ambassador to Israel condemned Chikli for holding a phone call with presidential candidate Calin Georgescu, who praised Romanian leaders who condoned the deaths of 280,000 Jews during the Holocaust.

French President Emmanuel Macron also complained to Prime Minister Netanyahu about Chikli after he openly supported Marine Le Pen’s presidential candidacy from the National Rally in the recent elections.

In recent weeks, Chikli also attended the “Make Europe Great Again” conference in Madrid, led by the Spanish Vox party.

Chikli’s party, Likud, also joined the Conservative Political Action Committee’s (CPAC) recent meeting as an “observer member,” one of the most important platforms of the national conservative movement in the West.

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EUROPE

Germany to cut budget amid armament preparations

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Germany’s likely next conservative chancellor, Friedrich Merz, said budget cuts should be discussed during coalition talks with the Social Democrats. This statement came after the announcement of a historic armament and infrastructure spending package.

Merz, of the CDU, said the next German government would have to cut costs despite the proposed 500-billion-euro debt-financed fiscal package.

“We will have to reduce costs at the federal level, at the state level, and in local communities. The margins have not become larger,” Merz told German public broadcaster ARD.

The landmark fiscal package also includes easing Germany’s constitutional debt brake on borrowing.

The spending plan is also supported by the Social Democratic Party (SPD), which is continuing coalition government talks with the CDU/CSU after last month’s early election.

The package includes investments in defense and infrastructure. The package requires a two-thirds majority in Germany’s lower house, the Bundestag, and upper house, the Bundesrat, to pass. The package has already been approved by the Federal Assembly Budget Committee.

The Greens, who initially opposed the package, are expected to vote in favor of it because 100 billion euros have been allocated to combat climate change. Merz hopes the constitutional amendments will be adopted before the new Federal Assembly takes office on March 25.

Some members of the Federal Assembly are planning to apply to the Federal Constitutional Court in Karlsruhe to block the vote on the multi-billion-euro fiscal package scheduled for Tuesday.

Independent member Joana Cotar has filed a lawsuit with the Karlsruhe court for the second time, demanding that the vote be postponed. The Constitutional Court confirmed on Sunday that the case had been accepted.

Three members of the Federal Assembly from the business-oriented Free Democratic Party (FDP) also said they would file an emergency application with the court, arguing that there was not enough time to publicly discuss the package’s impact on society.

According to FDP financial expert Florian Toncar, the current German government, consisting of the SPD and the Greens, has failed to answer “very simple and basic questions” regarding the package.

On the other hand, Merz also said that coalition negotiations with the SPD would involve “very difficult conversations” about much-needed reforms and what he described as “possible savings in the federal budget.” Merz argued that they would have to save money.

Referring to when Germany’s new coalition should be formed, Merz said it was too early to say and added, “We have not reached the end of the discussion. We have not yet reached the point of setting a date [for the new government].”

Merz wants to be chancellor before Easter in mid-April, about 50 days after the early election.

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UK and EU discuss confiscating Russia’s frozen assets

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According to Bloomberg, officials from the UK and the European Union (EU) are exploring legal and financial avenues to confiscate Russia’s frozen assets, following its military intervention in Ukraine.

This topic is on the agenda for today’s meeting in London between UK Foreign Secretary David Lammy and EU High Representative for Foreign Affairs and Security Policy, Kaja Kallas.

Sources speaking to Bloomberg noted that preparations for the potential confiscation of Russian assets are ongoing, despite opposition from some European countries, including Germany and Belgium.

These countries believe that seizing Russian assets could violate international law norms and affect the euro exchange rate.

The assets of the Central Bank of Russia held abroad were frozen after the start of the war, totaling over 260 billion euros.

A significant portion of the frozen assets is held in the Euroclear depository in Belgium.

The confiscation of Russia’s frozen assets has been discussed repeatedly for over three years since the start of the war.

However, so far, only the use of income from interest on these assets has been decided, and this income is being directed to support Ukraine.

EU officials have stated that there is no legal basis for the direct confiscation of the assets.

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