On the contrary, when Western European governments started to pursue such policies, they created a spiral of inflation that killed them in the end. The Social Democrats say they want to invest the money secured through deficit financing into housing, infrastructure, and energy production, which they say will strengthen the economy. After all, they are required by law to protect the savings of depositors and are therefore prohibited from making disadvantageous deals. They are not likely to make any profits on the SSD s concept of advantageous loans. Zeman wants to attract foreign capital through the provision of selectively granted advantages to foreign investors.
Foreign capital is required here.
Such an arbitrary system would run directly contrary to the principles of fair competition. The Social Democrats promise to put a stop to price deregulation while investing in the construction of new apartments also begs several questions. However, if the state starts running a deficit, the Czech National Bank will refuse to lower interest rates, which are already too high. This will curb the development of small business in this country. Despite the chorus of criticism with which government politicians and independent economic analysts greeted the SSD s economic program, there are other signals in Zeman s proposals.