Banker Warns German Spending Plans Pose Danger Without Cost Reductions

In Germany, there are concerns about excessive infrastructure and defense spending, with the president of the nation's cooperative banks cautioning that these plans could jeopardize public finances. Recent proposals by parties seeking to form the next government include a 500-billion-euro infrastructure fund and revised borrowing regulations, signaling a significant economic shift. Marija Kolak, head of the National Association of German Cooperative Banks, criticized the plans as "overshooting the mark," emphasizing the risk of escalating debt without corresponding measures for savings and structural reforms. She highlighted the potential consequences for future generations, undermining the long-term stability of public finances. Cooperative banks, integral to Germany's financial sector, consist of over 650 institutions holding 1.2 trillion euros ($1.30 trillion) in assets.