The German economy, Europe’s largest, has stagnated since the end of the pandemic. Recent data hardly give rise to optimism about its near-term prospects and the stagnation has reinforced malaise among German society – especially in the economically weaker former German Democratic Republic states, as evidenced by 1 September elections in Thuringia and Saxony. Debates are now swirling, even if improbable, about whether the current governing coalition can remain intact through its term. But the economy’s roadblocks are far more than cyclical. They are deep-seated and structural and were manifesting themselves even prior to Covid-19. Is Germany becoming once again the ‘sick man of Europe’? While fiscal space has been squeezed for governments around the world following the pandemic and war-related energy shocks, Germany has tremendous fiscal space, but instead shackles itself to Schuldenbremse (Germany’s constitutional debt brake). The German economy faces continued structural stagnation. Given the Free Democratic Party’s presence in the current governing coalition, Constitutional Court rulings and CDU views on debt and deficits, there appear to be few prospects for Germany to change its spots on the Schuldenbremse straitjacket. […]