Part 5/8:
The second question challenges the underlying necessity of a rule like the debt brake. Proponents argue that without such a constraint, political leaders may prioritize short-term goals over long-term fiscal health, leading to rampant borrowing. For instance, Romina Boccia of the Cato Institute warns that the United States’ lack of a fiscal rule has resulted in repeated deferrals of necessary economic choices, thus exacerbating its debt burden.
However, the counterargument posits that countries need not adhere to such strict regulations to maintain fiscal stability. Historical data suggests that nations like France and the US have successfully managed and reduced their debts without stringent borrowing rules.