Andreas Kluth, Columnist

The Ugly Side of Germany's $1.5 Trillion Stimulus

All over Europe, but notably in Germany, Covid-19 is becoming an excuse to embrace state capitalism.

June 11, 2020 at 5:00 AM UTC

Andreas Kluth is a Bloomberg Opinion columnist covering US diplomacy, national security and geopolitics. Previously, he was editor-in-chief of Handelsblatt Global and a writer for the Economist.

Stimulating.
Photographer: John MacDougal/AFP via Getty Images

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Every now and then during this extraordinary year, it’s good to pause and behold with awe how much has already changed, and how fast. Take Germany. For the past decade, most of the world, including me, has been berating those German tightwads to get over their balanced-budget fetish and spend, spend, spend. Then a pandemic comes along, and suddenly they do just what we’ve been asking for.

And how. Including the latest top-up and ancillary liquidity measures such as guarantees, Germany’s stimulus package to mitigate the economic hit from Covid-19 totals more than 1.3 trillion euros ($1.47 trillion). That’s by far the largest in Europe and even tops America’s, relative to gross domestic product. Kudos to Chancellor Angela Merkel.