63rd Annual General Meeting of the Ifo Institute

The 63rd Annual General Meeting of the Ifo Institute was held on 28 June 2012 in the Great Auditorium of the University of Munich. Prior to the meeting Kai Carstensen, head of Ifo's Business Cycle Analyses and Surveys Department, presented Ifo's latest economic forecast in the framework of a press conference. At the beginning of the press conference Hans-Werner Sinn, President of the Ifo Institute, spoke against a bank union. In the public part of Ifo's Annual General Meeting, devoted to the topic of "Government debt and generational fairness", Prof. Bernd Huber, President of the LMU, welcomed the large number of guests present. As the first of this year's three speakers, Hans-Werner Sinn offered an introduction to the topic. According to his introduction, German government debt has increased to over 80% of GDP. At the same time, birth rates in Germany are dropping. This represents an almost insoluble financing problem for the state. In Sinn's opinion, finding a solution to the sovereign debt crisis is difficult enough, but trying to resolve the bank debt crisis at the taxpayers' expense as well is simply impossible. Cardinal Reinhard Marx, the second speaker at the general meeting, agreed that dangerously high government debt needed immediate correction by implementing a sustainable finance policy. Former German President Roman Herzog, the third speaker of the day, recommended across-the-board cuts to government spending, but feared that the comfortable way out of these debts may prove to be inflation and low interest rates.