Sold Out: Support for Ukraine
For months, the federal budget was the number one priority on the German domestic political agenda. It was always going to make for a difficult compromise. The FDP refused to touch the “debt brake,” restricting the government’s ability to take on new debt in 2025. So, it was clear far in advance that priorities would have to be set. Some budget lines would come first, and others would have to rely on a bit of luck to get funding. For two-and-a-half years, Germany’s political leadership has unanimously and repeatedly told their voters that supporting Ukraine is in their own security interests, that it is the best defense against Russia, and, on top of that, that it is simply right and what international law requires. The presumption was that help for Ukraine would be one of those fixed budgetary priorities.
But continued support for Ukraine is precisely what the leaders of the FDP, SPD and Greens have put on shaky ground with the draft budget approved by the cabinet on Wednesday. Now that its details are public, it turns out that Germany is not planning to properly finance its supposed top foreign policy priority. The budget states that the German government assumes that “Ukraine will be able to cover a significant part of its military needs with the help of the additional financial aid of around USD 50 billion agreed by the G7 and currently being implemented.” And indeed, support to Ukraine has been halved in the draft budget, with reference to this G7 loan.
The $50 billion in aid for Ukraine is to be secured and repaid through the “windfall profits” from frozen Russian assets. The idea is that Russia itself is to pay for the reconstruction of Ukraine. So far so good. However, the G7’s plans currently exist only on paper. It remains to be seen how these proceeds can be used legally, including and particularly at the EU level. One detail to be clarified is what happens if the EU fails to extend its sanctions against Russia – for example, due to a Hungarian veto. This could cause the frozen assets to become unfrozen and the expected profits to disappear. Germany is de facto making its support for Ukraine dependent on Orbán’s approval.
Given that it is unclear when and how the G7 states will be able to actually mobilize the money, the responsible approach would have been to view these sums as a possible bonus, which could allow Germany to restructure its budget at a later stage. The way things stand now, the necessary aid for Ukraine is simply not guaranteed. Berlin is announcing these plans at the worst possible time: a second term in office for Donald Trump seems more likely than ever following the recent assassination attempt; his chosen running mate, JD Vance, is a prominent advocate of letting Europe pay for its own defense and is also openly campaigning to end military support Ukraine.
In this situation, it is grossly negligent for Berlin to have placed its ability to act and flexibly support Ukraine on anything but rock-solid ground. Germany sends a signal to the EU that it is no longer taking its support for Ukraine so seriously. It also squanders the trust that was only slowly being restored in Kyiv, the Baltic states and Poland since 2022, following years of a completely misguided Russia policy. The Kremlin, too, can lean back, confirmed in its assumption that its war will outlast Western support for Ukraine. The way the Russian war of aggression develops in part depends on Berlin; now the government is voluntarily tying its hands.
It was always clear that the federal budget for 2025 would not satisfy anyone and require complicated trade-offs. But this did not have to be the case. Why – at a time when Deutsche Bahn is so brittle that football fans could not make it to matches on time, hospitals are underfunded and the climate crisis is becoming ever more acute – is it necessary for the government of one of the most creditworthy countries in the world to restrict itself in this way? The debt brake in its current form leads to cynical debates over whether to spend on pensions or on the protection of Ukrainian children’s hospitals. Anyone wanting to both live in a safer world but also retire comfortably is losing out. This is simply irresponsible.
An extended version of this commentary was published by taz on July 22, 2024.
