Western Germany

ATLANTIC

December 1953

on the World today

SEEN from this side of the Atlantic, Germany seems to be racing toward a new and happy future. Watched at closer range from Europe, she appears to be moving backward to a not so promising past. True, the young Federal Republic can point with justified pride to remarkable achievements within the past five years. The success in reconstructing a frightfully devastated country and producing prosperity out of economic chaos is a great tribute to the German people.

They have almost doubled their national income from about 74 billion German marks (18 billion dollars) in 1948 to an estimated 134 billion in 1953. Industrial production as a whole tops the index figure of 1936 by roughly 60 per cent, and 1936 was a pre-war boom year. The number of unemployed has fallen below a million, the lowest since the end of World War II.

Exports have increased more than six times in five years. While other countries have to watch every dollar because they need much more from the United States than they can sell us, the Germans have chalked up a surplus in their trade with this country. Despite the fact that their coffers were bare when the war ended, they have saved about a billion marks in gold and hard currency.

They have an excellent standing within the European Payments Union—much better than many of the victor nations. Less than a decade ago, the German mark was a worthless piece of paper outside Germany. Even within the country, prices were figured in terms of American cigarettes or chocolate bars rather than in marks. Today the mark, worth 25 cents, ranks with the most trusted currencies in Europe or elsewhere.

The statistics are reflected in the health and prosperity of Western Germany. Factories are humming; buildings have sprung up everywhere in cities which lay in rubble only a few years ago. Stores are full of attractive goods; people are well fed and well dressed. Streets and highways once dominated by jeeps or vehicles of Allied officials are again buzzing with cars made in Germany. Germany is now producing almost three times as many cars as in 1936, when Hitler switched production from a peacetime boom to rearmament.

The dread of German rearmament

Germany’s amazing economic recovery today recalls the success of the German armies in 1939 and 1940. After the First World War, Germany was beaten, disarmed, and forbidden to rearm. When the Nazis began to build up their arsenal they started almost from zero. In September, 1939, when the first shots rang out over Europe, Hitler’s war machine, tactics, and strategy were right up to the minute, but the French ideas and tools of battle were the best there were in 1918. Germany’s supermodern weapons were matched against France’s museum pieces, and this was a major reason for Hitler’s early war triumphs.

If Germany were to rearm today, her army would have to get brand-new equipment from boots to tanks and from knapsacks to jet planes. Once more it, could be the most modern fighting force in Europe. It is little wonder that the French, with their experience of 1870, 1914, and 1939, have been hesitant about putting Germans back into uniform.

What they fear perhaps more than a new German Army is the armament industry that would equip it. That industry, too, would have to make an entirely new start, and therefore would be the most modern, the most streamlined, the most efficient in Europe. Thinking not in terms of a few years — when restrictions could hold down output of the new German plants — but in terms of decades — when such restrictions are unfeasible, as past experience has demonstrated — the French shudder at the proposal of German rearmament. Such fears are increased by the efficiency and resourcefulness shown in the extraordinary recovery of the German economy.

Germany’s comeback

The Germans were helped in their comeback by the fact that they and their war partners, the Japanese, were perhaps the only two nations in the world not compelled to spend a huge part of their national income on armament. Western Germany has had no national security expenses of her own since 1945. The country is still occupied and therefore automatically protected against attack. She pays occupation costs of about 7 billion marks a year, spending roughly 5 per cent of her national income on security, Britain and France spend more than 12 per cent.

Moreover Germany, forbidden to produce war matériel, is in a position to concentrate her entire industrial effort on peacetime production, tools, machines, consumer goods for herself and for export. In addition she has received very substantial aid in cash and goods to put her back on her feet, and the presence of thousands of American and other Allied personnel and their families means considerable revenue for the country.

After 1945 Germany’s factories were rubble and ashes. In those early post-war days the Gorman workers dug up what machines and tools they could find in the ruins of their plants. Other tools and machines were brought in from the United States and — mostly with American aid — from Switzerland, Britain, and other countries. New factories were built, more modern and more efficient than those they replaced.

Admitting all these advantages, the success would nevertheless not have been so striking if it had not been for the German people. It is significant that despite the bitter antagonism between the workers and the big industrialists, Germany has been practically free of strikes and has lost hardly any production because of labor trouble, while neighboring France and Italy have suffered grievously.

The Germans of today have proved to be at least as industrious, thorough, and aggressive as their fathers and forefathers. Unfortunately, they have also proved to be just like their fathers and forefathers in their approach to economic, social, and political problems. As a result, the Federal Republic is returning rapidly to the social and political setup which made Germany a menace long before 1939.

While the devastating effects of Nazism were still before the eyes of the world, the Allies pledged themselves to create a physically and ideologically healthier Germany. Less than a decade later it is apparent that the aim has not been accomplished, nor will it be accomplished. Little is left of all the big social and political reforms that were set in motion after the war. Denazification brought execution of a number of Nazis, imprisonment of an even greater number. But it fell far short of its real and positive objective, the removal of Nazis from positions of public trust and power.

The school reform encountered the resistance of deeply entrenched enemies. The civil service reform became a fiasco. The Western occupying powers tried in vain to persuade the Germans to reform their civil service in order to break the deadly grip which a small, narrow-minded, dictatorial clique had on government and people. But the first act if the new Parliament, constituted in 1948, was to strike the Allied civil service law from the books and replace it with the old one of 1937.

Restrictions on business

The latest casualty has been in the realm of what Germans call Gewerbefreiheit, the right of any citizen to establish himself in business. Prior to the end of the war, Germany had a business license system which went back to the medieval guilds, a kind of close corporation anxious to preserve its prerogatives and privileges, restricting opportunities for the masses and limiting the free enterprise of those who did not belong to the clique.

Starting a new business enterprise, whether a carpenter or locksmith shop, a grocery store, a fruit stand, or a shoe repair shop, required a government license. The license was conditioned on the approval of the respective guild. The new applicant had to be approved by a board of his prospective competitors, who could turn him down because in their opinion the new business was not needed or because the candidate was for some reason or other not desired in their organization. As John J. McCloy, former U.S. High Commissioner, once put it: “If the guild members believed they could handle all of the present business, they could, and usually did, refuse to permit a new competitor in the field.”

The American Military Government and later the High Commission used persuasion and coercion to protect free enterprise against this medieval German system. When their pleading failed, the American Military Government issued a directive in the fall of 1948 banning such restrictive licenses. But the guilds and the bureaucracy did not admit defeat. Two years later a bill was introduced in the new Bonn Parliament restoring the former practice. This bill was stalled by determined American opposition until a few weeks ago.

Chancellor Konrad Adenauer, shortly before the elections last September, appealed to Secretary of State John Foster Dulles to withdraw the objections to the German license law. Mr. Dulles agreed, on the condition that the German Supreme Court decide soon whether or not the law is constitutional. There is little doubt that the German judges will find the license law constitutional. Thus the last of the major American reforms has failed to stand the impact of the German rush into the past.

Only a little over a year ago Mr. McCloy in his last report as High Commissioner pointed out that 96,000 new businesses were started in the American zone during the first quarter of 1949, compared with under 15,000 in the same period of the previous year, before the American ban on restrictive licenses. He also wrote: “Estimates indicate that during 1949, 1950, and 1951, approximately 250,000 Germans in the U.S. zone opened new businesses which could not have been opened under the old licensing system. Most of these businesses are retail stores, handicraft shops, wholesale businesses, small manufacturers and independent professions: the vast majority of them are operating successfully.”The Chamber of Commerce and Industry in Wiesbaden further disclosed that of the bankruptcies reported, there were three times as many among older firms as among the new ones established after licensing was abolished in 1948.

Mr. McCloy also stated that the British and French zones of Germany never took steps against the license practice and as a result have “at least 500,000 so-called Schwarzarbeiter [unlicensed artisans]. In most instances these are competent and industrious persons who cannot obtain licenses to work openly in the trade of their choice. They have to go underground, work at night, shift from place to place. Since they must conceal their activities, they are afraid to pay taxes and to discontinue the drawing of their unemployment benefits.”

As a further consequence of their underground activities, they are compelled to underbid the legitimate businessmen and artisans, thus lowering prices and wages.

Return to regimentation?

Since the election last September, the trend toward the past has gained new momentum. Trial balloons have been released for the creation of a superministry of the Interior and Security (an ominous reminder of former police power) and for the setting up of a ministry of Information.

This is not entirely new. Less than a year ago, Dr. Ralph Nafziger, head of the University of Wisconsin School of Journalism, made an on-the-spot survey of the German press for the StateDepartment. “I have no doubt,”wrote Dr. Nafziger, “that the German Federal Government would shackle the press if it believed it could. . . . The Government attempted to control the press by . . . invoking old laws, some of them never before applied to newspapers.”

So far the systematic attack against the freedom of the press on the Federal, provincial, and city level of government has made little headway because of the strong resistance of German publishers and editors, the support they have received from the foreign press, and the determination of the Allied High Commissioners to keep the German press free. But the German public itself is not even aware of the importance of the struggle.

Thus the prospects for democracy in Germany are dim indeed. This does not mean, however, that dictatorship is around the corner. For the present, at least, the political development seems to be moving in the direction of a two-party system.

Communism has been practically eliminated. The Communist Party, which in 1933 rallied roughly 5 million followers, was unable to get a single delegate elected to the Bundestag last September. The explanation is obvious. With millions of prisoners of war returned from Russia and with 18 million of their countrymen in the Soviet zone, the Germans have come to know too much about Communism to be tempted by it.

Neither will they make another deal with the Soviet Union as the Weimar Republic did at Rapallo in 1922, or Hitler in 1939. They know that today they are dealing with an immeasurably stronger Russia, which would swallow them in no time. No matter what their negotiators may say around the conference table, they cannot cut themselves loose from the West.

Adenaner’s coalition

This fact is recognized by Dr. Adenauer’s conservative coalition and by the Social Democrats, who for years have been trying to gain votes by their uncompromising demands for a reunified fatherland and their opposition to participation in an anti-Communist alliance unless based on complete German sovereignty. On the question of the Saar, the Social Democrats have been even more nationalistic than the Center and right-wing parties of Dr. Adenauer’s coalition.

The 77-year-old Chancellor is now in a strong enough position to push through Parliament almost any measure he desires. But no matter what he may favor deep down in his heart, Dr. Adenauer is diplomatic and realistic enough not to stray from the course which is slightly right-of-center. He is not a dictator, nor would the internal or external conditions permit a dictatorship.

The real danger lies in the return of the Germans to a frame of mind which stymied social and political reforms and preserved feudal government. Bismarck, the Iron Chancellor, and Hitler, the totalitarian leader, played on those two strings of social reforms and national greatness. But while nationalism grew fiercer, German society retained its feudal caste structure under the Emperor and under the Weimar Republic.

That is why the German masses fell for Nazism, why Hitler was possible — perhaps inevitable. Eight years after the Nazi Götlärdummerung, Germany has risen from defeat only to return to principles which led her to short-lived triumph, followed by long despair, in 1918 and 1945.