The Bundestag. Economic rebalancing is needed in Germany as much as abroad.
Germans save much more of their income than the British, taken as a whole. In Germany, both the private sector, consisting of firms and households, and the public sector, or government, are currently spending less than they earn. In the case of the private sector, they saved nearly 8% of GDP in 2016.
The government is also saving, but much less than the private sector. The German budget surplus was 1% of GDP last year. Still, it is closer to balance than many of their rich country neighbours.
Take Britain. The private sector there managed to borrow around 2% of GDP in 2016, while the government’s budget was in deficit by nearly 4% of GDP.
Is this prudence on the part of Germany, and profligacy on the part of the British? Continue reading