In post-war Germany for a long period of time public debt was not a subject of economic policy discussion. Government debt related to war-financing had been almost completely cancelled out by the currency reform of 1948, and the new constitution required a balanced budget. Debt financing was only allowed for investment purposes. Accordingly public debt grew at very moderate rates and was mainly issued by local governments. In order to stimulate private capital formation the federal budget and the state budgets for many years were in a surplus position.