German Fin Min Shoots Down Draghi Joint Debt Call-Politico

Politico reporting that German Finance Minister Christian Lindner has swiftly shot down calls from former Italian PM and ECB president Mario Draghi for a new common EU debt fund to advance investment in industry and defence. Draghi presented his long-awaited report on EU competitiveness earlier today. The document (full version here, abridged version here) calls for a "boost [in] centralised funding whilst maintaining budget discipline to support an additional EUR750-800 billion in annual investment spending over the next few years".

• As noted in an earlier MNI Policy article (see 'MNI: Draghi Calls For EU Funds To Support Huge Investments', 9 Sep), "Draghi called for the issuance of a common safe asset "on a more systematic basis" in order to underpin an EU Capital Markets Union and so lower the cost of capital for private sector financing of his transformative proposals, but said stronger fiscal rules will be required to ensure that public debt at the national level is put on a more sustainable path."
• Lindner told Politico that such pooling of EU debt "risks and liability creates democratic and fiscal problems," adding "Our problem is not a lack of subsidies, but the shackling of bureaucracy and a planned economy, More government debt costs interest, but does not necessarily create more growth."