<div>In this episode of the Sound of Economics, we look at Germany’s budget outlook under new Chancellor Friedric Merz and whether much-needed reforms to the so-called debt brake put Berlin on a collision course with Brussels. Host Rebecca Christie is joined by Bruegel's director, Jeromin Zettelmeyer, and Bruegel non-resident fellow, Armin Steinbach, to discuss the legal and economic implications. How can the EU encourage Germany to spend more on defence and security without unraveling the new fiscal rules? Does the EU need to redo its debt safeguards again?

Relevant research:</div>
<ul>
<li>
<a href="https://www.bruegel.org/analysis/germanys-fiscal-rules-dilemma">Germany's fiscal rules dilemma</a>, Bruegel Analysis, Armin Steinbach and Jeromin Zettelmeyer, 24 April 2025</li>
<li>
<a href="https://www.bruegel.org/newsletter/will-eu-fiscal-rules-prevent-germany-using-its-new-national-borrowing-space">Will EU fiscal rules prevent Germany from using its new national borrowing space?</a> Bruegel newsletter, Armin Steinbach, 28 April 2025</li>
</ul>


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