The other department heads in Berlin are used to unpleasant mail from the finance minister at the beginning of the year, but one important argument was new.

Before his officials start talks with the individual ministries for the 2024 federal budget, Christian Lindner warned to save and even threatened budget cuts, so far he kept to the ritual.

But he cited a reason that even veteran colleagues hadn't heard from for a long time: Unfortunately, unfortunately, the federal government had to spend a growing proportion of its budget on interest payments.

Patrick Bernau

Responsible editor for economy and "value" of the Frankfurter Allgemeine Sunday newspaper.

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Ralph Bollman

Correspondent for economic policy and deputy head of business and “Money & More” for the Frankfurter Allgemeine Sunday newspaper in Berlin.

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Certainly, the amount of debt is growing.

Inflation has also jumped sharply, the central banks are taking countermeasures by raising interest rates, and commercial banks are once again willing to pay money for savings deposits.

So it's only logical that even a trustworthy debtor like the Federal Republic of Germany has to offer investors a certain return in order to get their government bonds out to the public.

For ten-year federal bonds, it is now more than two percent again.

It wasn't that long ago that investors even paid extra so that they could save their money from the world races with Lindner's two predecessors, Olaf Scholz and Wolfgang Schäuble.

The only question is: why now, and why is it getting so expensive so quickly?

According to its own financial planning, the federal government has to place 539 billion euros in new paper this year, more than ever before.

Of this, more than 325 billion euros are attributable to bonds and other securities that mature in 2023 and have to be replaced by new issues.

That's a lot given the total debt of almost 1.6 trillion euros, or more precisely: about a fifth of the total federal debt will have to be rolled over in the next twelve months.

Longer-term bonds would have saved a billion euros this year

The question therefore arises: in times of extremely low interest rates, could one not have issued longer-term bonds in order to secure the favorable conditions for a very long time?

The opposition sees it that way.

She accuses the former Finance Minister and current Chancellor Scholz of not doing it because the short-term conditions were a bit cheaper and therefore made the current budget look better.

“Olaf Scholz deliberately took a risk in order to improve his short-term interest balance.

It's taking revenge now," says Jens Spahn, deputy chairman of the Union faction in the Bundestag.

"He could have secured lower interest costs for Germany for longer." As the most attractive debtor in the world, according to Spahn, the Federal Republic could have pushed through more bonds with a 30- or even 50-year term on the market during the Scholz years without any problems.

Unfortunately that didn't happen.

The issue here is not whether the federal government is taking on a lot of debt or not.

It's just a question of whether she does it skillfully or not so much.

Most OECD countries have acted

Most German homebuyers secure their loan interest for 15 or 20 years, sometimes even longer.

However, even during the low-interest period, the German federal government strictly adhered to the fact that it would not even want to repay its loans after 7 years on average.

While most of the countries around Germany were changing the maturities of their government bonds cautiously and gradually, practically nothing was happening in the Federal Republic.

Between 2007 and 2021, the average maturity of German government bonds rose from 6.5 to 6.8 percent.