
"Only four months after the government took office, satisfaction with the ruling coalition of the center-right Christian Democrats and Christian Social Union (CDU/CSU) and center-left Social Democrats (SPD) has fallen to a record low: In a monthly opinion poll, only 22% of eligible voters said they were satisfied with Chancellor Friedrich Merz's government. The Cabinet ministers are now meeting for a closed-door session at Villa Borsig in Berlin to talk about several hot potato issues."
"Merz alienated many of his voters when he quickly relaxed the "debt brake" that limited fresh borrowing to 0.35% of gross domestic product (GDP), which he had vowed to uphold throughout his election campaign. Now, enormous credit-financed sums are available for investment in infrastructure and defense. Yet this came at the expense of Merz's credibility with his voters, and it means that the government faces rising interest payments."
"The SPD is in favor of higher taxation on large wealth, inheritances and income to generate more revenue for the state and for social justice reasons reasons. The CDU and CSU oppose nearly all tax increases, arguing that they are detrimental to the economy. Some conservative politicians have recently indicated a willingness to make concessions on the inheritance tax. This may signal the possibility of a tradeoff, with the SPD accommodating the CDU/CSU on other issues, such as "citizen's income.""
Public satisfaction with the CDU/CSU-SPD coalition under Chancellor Friedrich Merz dropped to 22% four months into the government. Cabinet ministers convened at Villa Borsig in Berlin to address urgent political and fiscal issues. Merz relaxed the "debt brake" limiting annual borrowing to 0.35% of GDP, enabling large credit-financed investments in infrastructure and defense while increasing interest payments and damaging his credibility with voters. The CDU/CSU advocate austerity to control rising interest costs, while the SPD prioritizes revenue increases through higher taxes on wealth, inheritances and income. Some conservatives signaled willingness to concede on inheritance tax, opening potential tradeoffs over citizen's income.
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