Poor but sexy
The Bundesverfassungsgericht (German Supreme Court) will be deciding next week just how destitute the city of Berlin really is. The city government officially gave Berlin the status of being in an “extreme budgetary emergency” back in 2002 in a ploy to get the high court to officially recognize its plight and through this gain the legal leverage it needs to finagle some cash from the federal government for refinancing purposes - it’s claim being, of course, that it’s financial distress was not of its own making. So I guess “poor but sexy”, as Berlin’s mayor Klaus Wowereit once referred to his city isn’t really the proper term to use here. “Broke but still breathing” is much closer to the mark when it comes to describing this city’s finances.
Berlin has a long tradition of not worrying about where the money comes from. It was heavily subsidized all throughout the Cold War and although these subsidies were soon cut after the Wende (the turn, as in historical turn, as in the fall of the Wall), Berlin politicians continued to keep spending money as if there were no tomorrow. I guess being the new German capital and all that brings a certain sense of invincibility along with it. They’re not going to let us go broke or anything, right?
Anyway, they are going to let them go broke now doch (after all) and it looks like the party is finally and truly over. Berlin operates today under a monstrous 60 billion euro debt, spending 2.5 billion annually just to cover the interest. It only has an operational budget of about 20 billion, and up until very recently it was spending up to 6 billion more each year than it had on the plus side.
None of the city’s politicians, regardless of their political affiliation, believe that Berlin can climb out of this hole on its own anymore. But the federal government certainly has no intention of helping and the other Länder (federal states) see no reason in giving the city a break, either. They claim and can prove, most agree, that the city only has itself to blame in this matter and that they still have some room to maneuver. Sure they do, but all the maneuvering will be in a downward spiraling motion, and everybody knows that, too.
So whatever the decision may be next week, the situation is fatal, but certainly not hopeless.
Berlin bleibt doch Berlin!
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