With the global recession deepening and the banks still too paralysed to transmit the benefit of radical monetary loosening, the need for a co-ordinated fiscal stimulus has been obvious for some time. Except, that is, to Germany, whose fiscal orthodoxy has been so rigorous as to seem to some critics to amount to a smokescreen for mercantilism.

Berlin had objected to a classic Keynesian fiscal stimulus on cultural and structural grounds: Germans would save rather than spend extra cash; moreover, it is the collapse in demand for Germany’s exports that has triggered its recession. In any case, the argument goes, Germany’s high tax receipts will fall sharply in this recession, providing automatic stimulus through relief to taxpayers.