Inflation, war, Corona: Finance Minister Christian Lindner waved many billions of euros in new debt through. Now he says: stop it, put all subsidies to the test! A conversation with the supreme debt brake.

FOCUS: Mr. Lindner, what scares you the most: A) The extravagance in the cabinet? B) The rebelliousness of your party? C) Inflation?

Christian Lindner: I’m not afraid, but inflation is currently my main focus.

Germany is experiencing the fastest currency devaluation in 40 years. 7.4 percent. Is the situation dramatic?

Lindner: We must do everything we can to prevent stagflation…

…so rising prices with no growth.

Lindner: If that solidifies, there would be a threat of an economic crisis that could be felt in everyday life. The breadth of society would be affected, from pensioners to master craftsmen. We must therefore react with sharp consistency.

And how?

Lindner: First of all, we have to take the pressure off the prices. More and more subsidies from the state drive the development. Secondly, we must provide targeted relief for the people affected. Third, we must free the state from the debt economy. I am also sure that the very independent European Central Bank is living up to its very great responsibility…

…so finally raise interest rates?

Lindner: Inflation was not first fueled by monetary policy. But the value of the euro is changing against the dollar. The US has raised interest rates. That has an impact. As finance minister, I respect the independence of the ECB, but one can only recommend that states and central banks act with power rather than hesitation.

Can you be sure that highly indebted euro countries would not be threatened existentially by higher interest rates?

Lindner: This danger is calculable in the short term. To avoid long-term risk, we need to end the era of expansionary fiscal policies and debt-based bailouts everywhere. The state cannot permanently subsidize prosperity on credit. We must learn again to work with the money that people give us. Economic policy must not exhaust itself in the drawing board planning of the transformation that is to be brought about with state money.

Let’s be honest: inflation is good for you as finance minister! The debt is also devalued.

Lindner: A popular misconception. The state can only record a one-off effect at the beginning of an inflation. After that, like everyone else, he pays the increased interest and prices – for personnel, services, goods.

Many experts are now predicting that this crisis will last for a long time.

Lindner: At our G7 meeting in Bonn, the experts gave us one piece of advice above all: the more boldly we act now, the greater the hope that we won’t slip into a phase of prolonged currency devaluation.

The Germans are more worried about inflation than about the war in Ukraine – rightly so?

Lindner: Both are related: The current economic escalation has its origins in Russia’s invasion of Ukraine.

Inflation in the euro area was already high before that.

Lindner: That’s right. However, a recovery was to be expected after Corona – until the Ukraine war. Prices on the energy and food markets will remain high for the time being.

Reducing VAT would take some of the pressure off people?

Lindner: No. One cannot permanently subsidize against rising world market prices. We have suspended the artificial increase in the price of fuel through the energy tax for three months. However, this is only a temporary reduction in a volume tax that has a fixed rate per liter. The right way is to directly relieve tax on income. We also have to keep an eye on people who depend on transfer payments, because they have the least leeway.

So increase Hartz IV?

Lindner: The rule set is based on a shopping basket. If the goods become more expensive, the standard rate changes. Above all, we must understand the tax system as a tool to curb inflation.

In what way?

Lindner: If BurdaVerlag pays its Focus editors a higher salary that doesn’t even compensate for the inflation-related loss of purchasing power, then the state shouldn’t intervene.

Do you want to prevent this so-called cold progression?

Lindner: I’ve always said: The cold progression is a tax increase through omission. That is why we have reduced income tax retrospectively as of January 1st. The basic allowance will be increased, as will the employee allowance.

You have just presented your first budget: 140 billion euros in new debt. Plus 100 billion special assets for the Bundeswehr. How does it feel to be responsible for such a mountain?

Lindner: I haven’t given up feeling uneasy about every billion new issues. Just like every billion new debts. Nevertheless, I can reassure people: our finances are solid and under control. We only incur debt where there is no other way – for example to quickly remedy the years of neglect of the Bundeswehr. My goal is for us to put the state of emergency behind us next year.

If you want to comply with the debt brake again in 2023, your new debt must not even be eight billion euros – wish or promise?

Lindner: Realistic scenario. You will experience this before the summer break.

Sounds like a threat. How do you intend to redeploy the money so radically?

Lindner: We have to prioritize the projects of the traffic light coalition. Not everything can be implemented immediately. We are already in the consolidation phase. I am preparing for the economic turning point.


Lindner: When we discuss the 2023 budget, then this coalition will really be formed. A coalition agreement is vague, and the first few months were marked by crises. If I want to spend more, I have to answer: Cover me up! The debt brake applies.

So you’re already mentally canceling traffic light projects?

Lindner: Unfortunately, not all colleagues in the cabinet have sufficiently internalized that we cannot continue to do business as before. This will be a moment of awakening for all of us that…

…you like to get?

Lindner: …we will develop together. I am bound by the constitution. We have agreed on a coalition agreement, but the Basic Law applies first. In this situation, we have to do without everything in the budget anyway that tends to increase inflation.

For example?

Lindner: In times of rising building material prices and a shortage of skilled workers, subsidies for new buildings would only fuel prices. The same applies to purchase bonuses for electric vehicles and many other things. What will also relax the budget: next year at the latest, large sums of previous additional expenses related to Corona should and must be eliminated. We should already do without free citizen tests this year.

So you continue to promise that you will neither raise taxes nor lift the debt brake?

Lindner: Both apply, yes. And I would like to mention a third point: with me, there will be no mutualisation of debts at European level.

If you could take a temperature near Germany, what temperature would you expect?

Lindner: A large majority of people are responsible and deal with the challenges calmly, even tolerantly. At the same time, however, the pressure is growing, which has recently been articulated from the middle of society due to general dissatisfaction.

Have you ever had eggs?

Lindner: Not that. But I’ve never experienced whistling concerts like the last time during the election campaign. Apparently, many “lateral thinkers” quickly retrained from vaccination opponents to Putin friends.

Is that perhaps also because people find this society increasingly unfair?

Lindner: Certainly have a problem of justice, which I see above all in the case of difficult opportunities for advancement. But that’s not the trigger that has sparked so much for quite some time. Parts of the middle class are not so loud because they have suddenly become needy. Rather, they see their traditional way of life challenged by the accusations and supposed alternatives of a certain urban milieu. Some feel compelled to justify themselves, which is neither necessary nor helpful.

What allegations are you thinking of specifically?

Lindner: We’re seeing an ever-increasing discrepancy between people who live in the city and those who live in the country. There is often a lack of understanding and a certain tolerance for the needs of others.

Would it be fairer if you skimmed off the high profits of current crisis beneficiaries, such as the mineral oil companies?

Lindner: Counter question: Do you think that the producers of corona vaccines, scarce semiconductors, solar or wind energy should be taxed higher? The latter are also currently making very high profits. All demands in the camp of the Left or Greens then quickly fall silent.

But it feels like the mineral oil companies in particular are taking everything they can get with them.

Lindner: Tax policy shouldn’t be based on instinct. If there are unjustified gains due to abuse of power in the market, then my colleague Robert Habeck will take care of it. He is responsible for the Federal Cartel Office and the Market Transparency Unit. No one will accuse Mr. Habeck of wanting to spare the mineral oil companies. He has me there by his side.

He seems to have a lot on his side right now. The Green is praised as authentic for his ideological about-faces. If, on the other hand, you take on new billions in debt, you are considered a tumbler. Is politics unfair?

Lindner: I cannot see that Mr. Habeck would have said goodbye to the goal of a climate-neutral Germany. On the contrary, with his Easter package he even pushed his party’s agenda, which is now being discussed in detail in the Bundestag in terms of the economic burden and what is physically feasible. I haven’t changed my principles either.

Are you sometimes jealous of Habeck’s current sympathy values?

Lindner: Envy is alien to me. And: I don’t compare myself or the FDP with others. The FDP should only measure itself against itself. We are not a people’s party, but advocate for people who have a very special view of life. Who have an eye on individuality, enthusiasm for performance, personal responsibility and tolerance towards others. That’s why I compare today’s FDP results with those four, eight or twelve years ago. My goal is not the chancellor candidacy, like perhaps with Ms. Baerbock and Mr. Habeck. I want the FDP to be re-elected in two digits. That would be a success.

…judging by the results of the last state elections, but still a long way to go…

Lindner: I occasionally think of 2017, when we in the federal government rejected the Jamaica coalition. Many said at the time: That is a serious mistake, you have to make compromises. Back then, I already prophesied that the same people would one day criticize when we make compromises in a coalition. That’s why I have strong nerves. Success is not decided over short distances. It’s always about the long haul.

You are the only one in the cabinet who is also party leader. advantage or problem?

Lindner: I see it as an advantage. The traffic light was actually the most unlikely coalition option. Our ideas were anything but congruent. And it came about solely because the CDU was unable and the CSU unwilling to start a new attempt at Jamaica. It is therefore particularly important that, as party leader and finance minister, I can see to it that we are implementing the political plans that we have promised our voters and at the same time set limits where we see fundamental liberal convictions violated.

You don’t see yourself as a turncoat, but as a last man standing?

Lindner: I just do my job. I can see that the SPD and the Greens, in contrast to us, want almost everything to be regulated by the state. They want to organize massive redistribution, like to operate with bans and prefer to rely on higher taxes for everything. We see it differently.

Maintaining your course throughout the legislature is going to be a back-breaking job.

Lindner: That doesn’t scare me: I’ve endured extra-parliamentary opposition for four years.

So you’re used to pain?

Lindner: What does pain mean? I enjoy my job every day. But the fact is: Every day without the FDP in government, there would be noisy discussions about relaxing the debt brake and new taxes. You only have to look in the newspaper: Every day, the SPD and the Greens question the prevention of tax increases and national debt. I’m also sure we would still be sitting here with masks if only the Greens and Mr. Lauterbach had had their way.

Everything doesn’t sound as harmonious as it did at the beginning of the traffic light.

Lindner: It is still a trusting and confidential cooperation. But do you really think that the coalition negotiations went smoothly? Just because the capital’s media didn’t find out much about it?!

Do you sometimes long for Friedrich Merz?

Lindner: No. The CDU/CSU manage to demand subsidies in the three-digit billion range in the morning and complain in the afternoon that the debt is too high. This Union is currently acting according to Opposition Handbook 1.0 with very simple texts: too little or too much, too fast or too slow. I don’t see any new ideas. Both parties seem to be still looking for direction.

Orientation sometimes seems to be lacking even in the chancellor. Have you become so close to him that you could call him and say, “Now go to Kyiv!”

Lindner: The chancellor doesn’t need any advice from me. I have a collegial relationship with Olaf Scholz, also because I never say anything from bilateral talks. Incidentally, I don’t think it’s a problem if it becomes apparent that the FDP has different positions than the SPD. The FDP spoke out clearly and early on in favor of the delivery of heavy weapons. There are different perspectives. We have formed a coalition, not a merger.

What has changed the most for you since taking office?

Lindner: Clearly: the international component. So far I have been a German politician and have moved in the German environment. Today 30 percent of my work is in English. On the international stage, I don’t speak for myself, but for the Federal Republic, including those who didn’t vote for me. It takes a lot of preparation and thought to do the right thing.

And just this year, Germany also holds the presidency of the G7.

Lindner: If I could have chosen, I would not have had to become finance minister and at the same time president of all G7 finance ministers.

In the meantime, there is another major project: on July 7th you will marry the TV presenter Franca Lehfeldt – not in Tuscany after all, but on Sylt. Why in the north?

Lindner: I don’t say anything about private things.

As a couple who are so much in the public eye, is it even possible to protect the private sphere?

Lindner: Yes. For many years I have made a very clear distinction between what I do in my offices and what I do privately. Also because I know that I am the subject of arguments and that the left-green community on Twitter feels provoked by some of my positions. I want to keep family and friends out of these controversies.

Has the way people behave towards you changed since you took office?

Lindner: No, not at all. The only difference is that I was completely alone during the federal election campaign. Today the state protects the office, which is why security officers are always present.

Have you ever had the feeling: “That’s enough for me! I’ll stop now”?

Lindner: Never! My passion is politics. That’s why I apply for a mandate, every time with all my strength. Anyone who complains about how terrible everything is should hand over the task to someone else who draws all his motivation from it. That’s how it is for me.

This article first appeared in the current FOCUS magazine.