Death of the Swabian housewife
Germany’s puritanical streak when it comes to accruing debt runs deep. After all, the German word for “debt,” Schuld, also means “guilt.”
Germany’s debt brake, which restricts the federal deficit to 0.35 percent of GDP, was written into the constitution in 2009 during the reign of then-Chancellor Angela Merkel. Europe was at the time enmeshed in a spiraling debt crisis, and although Germany had the ability to borrow cheaply, Merkel and much of Germany’s political establishment believed it was more important to provide profligate borrowers in southern Europe with a moral paragon. Merkel invoked the frugal “Swabian housewife,” a character who had the common sense to know that every household must live within its means.
That moral attitude has long roots in the German psyche. German households in the past have often maintained high rates of savings, even when it made little financial sense. Even during periods of hyperinflation, such as the interwar Weimar Republic, when money was nearly worthless, Germans continued to save at relatively high rates, according to economic historian and curator Robert Muschalla.
“You can assume that the ideology of this savings behavior is so unconscious and deep-seated that it plays a big role in the political arena,” Muschalla said. “There is no real economic reasoning behind it, if you like, but it’s rather a truly moral consideration.”
It’s somewhat of a paradox that Merz might be the one to bring about the death of Germany’s mythological Swabian housewife. One of his political mentors, after all, was the late conservative stalwart Wolfgang Schäuble, the face of European austerity during the continent’s debt crisis.
Now, however, even conservatives who admire Schäuble view his legacy with more nuance. “I take a critical view of the years in which Schäuble was finance minister,” Günther Oettinger, a former European commissioner and longtime senior politician in Merz’s Christian Democratic Union, told POLITICO. “We clearly spent too little for the military in the budget. So Merz must now make a correction.”