By: R.G. Livingston

R.G. Livingston — Fri, 20 Jul 2012 02:11:18 +0000

This article omits one minor and two major points that bear on the transfer union question. Minor: besides Bavaria, Baden-Wuerttemberg, and Hesse, Hamburg, a northern state but a rich one, also provides transfer funding. Major: the constitution, the Basic Law, provides (Article 72) that “The Federation shall have the right to legislate…to the extent that establishment of equivalent living conditions throughout the federal territory…renders federal regulation necessary in the national interest.” Article 107 (2) provides that [Federal law] shall ensure that the disparate financial capacity of the Laender shall be appropriately equalized.” So intra-Land transfers are constitutionally anchored. Also, since 1990 there has been a truly massive transfer of resources, almost two trillion (yes, trillion) euros so far, from the western to the eastern states to carry out the constitutional requirement of “establishment of equivalent living conditions throughout the federal territory.” This massive transfer is being mainly financed by a “solidarity surtax” on personal incomes, which is to remain in effect until 2019 at least. So both the principle and practice of a transfer union are firmly established in the Federal Republic. Bavaria’s appeal to the constitutional court is motivated by the CSU’s effort to project itself to Bavarian voters as Bavaria’s chief protector in the hope of regaining in the next Land elections the absolute majority in the Bavarian Landtag that the CSU had for many years but lost a few years ago.

By: Dale Medearis

Dale Medearis — Thu, 19 Jul 2012 11:45:03 +0000

I suspect this has been done, but I could not help but wonder after reading this whether there are any papers that compare the sharing of revenues between states in Germany and states in the US in specific policy (or even spatial) context, such as transportation infrastructure, water infrastructure, or military spending.

Comments on: “Who’s Picking Up This Bill?”

By: R.G. Livingston

By: Dale Medearis