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No matter what the future debt brake may look like, public budgets must be consolidated qualitatively in order to maintain fiscal sustainability and the power to govern. This also means cutting out old habits. ‘That means action. We don't have a knowledge problem,’ states Michael Thöne in the Handelsblatt cover story on the reduction of subsidies and tax breaks. If everyone has to swallow bitter pills, it becomes politically easier and 20 billion euros or more can be generated each year.

Demographic change, digitalisation and the climate neutrality goal are putting Germany's economy through a great transformation. Maintaining and strengthening our model of value creation is crucial - but not easy in times of increasing labour shortages. In the Böll Foundation's Economic Atlas, Michael Thöne writes that immigration, AI and smart, not reality-shy policy-making can be part of the solution. Listen to the podcast here.

The KDZ Centre for Public Administration Research has appointed Michael Thöne to its Advisory Board. The KDZ in Vienna is an institute that is as rich in tradition as it is forward-thinking, bringing together research and practice for excellent scientific policy advice. "I am very much looking forward to the deepened exchange with the KDZ and the other trustees from Austria, Switzerland, Germany and South Tyrol," says the FiFo Director, expressing his gratitude for the honour.

The survey "NRW.BANK.Fokus Kommunen" enters its second year. In addition to investments and climate change, this edition focuses on the retention of skilled labor. We warmly invite all financial decision-makers of the municipalities to contribute their perspectives through the survey. The results will be published in August 2024 in an anonymized research report.

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In spite of its strong starting position, the sustainability of public finances in an ageing Germany is at risk. FiFo Policy Fellow and one of the "Five Sages" Martin Werding, with Benjamin Läpple and Sebastian Schirner, conducted the calculations for the Federal MoF's 6th Sustainability Report. If policies remain unchanged, German public debt will more than double to 140% of GDP by 2070 in the best-case scenario and rise to a dizzying 345% in the worst-case scenario. FiFo Report 33 provides the calculations and possible solutions in the full version.