Crisis gives Germany sense of vindication for ‘Black Zero’ years

That scenario has now materialised with the coronavirus, and Chancellor Angela Merkel is using Germany’s ample fiscal space to aid the economy and contribute to the region’s 540 billion-euro (US$590bil) rescue package.

FRANKFURT: Now Germany is deploying its financial firepower to fight the coronavirus crisis, convincing the country that it was wrong to shun budget deficits for many years just got even harder.

The government of Europe’s biggest economy has long faced calls by officials from the International Monetary Fund and the European Central Bank (ECB), to the US administration of Donald Trump, that it should spend and borrow more.

Its finance ministers, backed by voters, insisted that balanced budgets and low debt were prudent policies storing up ammunition for a crisis.