Germany's "debt brake" key to economic resilience and crisis readiness.
Germany implemented a new fiscal rule called the "debt brake" to reduce public debt after the financial crisis. This rule helped lower debt ratios during normal times, allowing for strong fiscal responses during crises. Success of fiscal rules depends on public and political acceptance, clear design, and legal backing. To prepare for future crises, countries like Germany need to maintain low debt ratios by improving fiscal rule design, transparency, and rule compliance. Abolishing fiscal rules would hinder the ability to address long-term challenges and unexpected crises.