Contemporary challenges to German federalism: from the European union to the global economy

摘要

Three major challenges confront German federalism today. The first is the strong and growing dispute among German Lander over their present fiscal federalism arrangements. In essence, the wealthier Lander are pushing hard for less horizontal redistribution of tax revenue from the wealthy to poor Lander; as well as more fiscal decentralization. Disputes over fiscal federalism have been an enduring feature of postwar German federalism and thus, in one sense, are nothing new. Yet the current dispute appears to be more serious than past ones because never before has there been such a vast disparity in fiscal strength among Lander as in post-reunification Germany. The intensity of the current struggle also reflects the desire by wealthier Lander to have more autonomy in meeting the challenges of the global economy. More broadly, the wealthy Lander are pushing for a shift from the traditional "cooperative federalism" of the postwar era to a more "competitive federalism" similar to that of the United States. While this is an unlikely outcome, it would represent a fundamental paradigmatic shift in the nature of German federalism.