Wirtschaftswunder

From Wikipedia, the free encyclopedia

You have new messages (last change).

The term Wirtschaftswunder (English: "economic miracle") designates the upturn experienced in the West German and Austrian economies after the Second World War. The expression was coined by The Times in 1950.

Contents

[edit] West Germany

The West German Wirtschaftswunder was partly due to the economic aid provided by the United States and the Marshall Plan, but mainly due to the currency reform of 1948 which replaced the Reichsmark with the Deutsche Mark as legal tender, halting rampant inflation. This act to strengthen the German economy had been explicitly forbidden during the two years that the occupation directive JCS 1067 was in effect. JCS 1067 had directed the U.S. forces of occupation in Germany to "…take no steps looking toward the economic rehabilitation of Germany". The Allied dismantling of the West German coal and steel industry decided at the Potsdam conference was virtually completed by 1950, equipment had then been removed from 706 manufacturing plants in the west and steel production capacity had been reduced by 6,700,000 tons.[1] The industrially important Saarland with its rich coal fields was not returned to West Germany until 1957.

In addition to the physical barriers that had to be overcome for the German economic recovery (see the Morgenthau Plan) there were also intellectual challenges. The Allies confiscated intellectual property of great value, all German patents, both in Germany and abroad, and used them to strengthen their own industrial competitiveness by licensing them to Allied companies.[2] Beginning immediately after the German surrender and continuing for the next two years the U.S. pursued a vigorous program to harvest all technological and scientific know-how as well as all patents in Germany. John Gimbel comes to the conclusion, in his book "Science Technology and Reparations: Exploitation and Plunder in Postwar Germany", that the "intellectual reparations" taken by the U.S. and the UK amounted to close to $10 billion.[3][4][5] During the more than two years that this policy was in place, no industrial research in Germany could take place, as any results would have been automatically available to overseas competitors who were encouraged by the occupation authorities to access all records and facilities. Meanwhile thousands of the best German researchers were being put to work in the Soviet Union and in the U.S. (see Operation Paperclip)

Contrary to popular belief, the Marshall Plan, which was extended to also include Western Germany after it was realized that the suppression of the Western German economy was holding back the recovery of the rest of Europe,[6] was not the main force behind the Wirtschaftswunder.[7][8] Had that been the case, other countries such as Great Britain and France (which both received higher economic assistance from the plan than Germany) should have experienced the same phenomenon. In fact, the amount of monetary aid (which was in the form of loans) received by Germany through the Marshall Plan (about $1.4 billion in total) was far overshadowed by the amount the Germans had to pay back as war reparations and by the charges the Allies made on the Germans for the ongoing cost of occupation (about $2.4 billion per year)[9]. In 1953 it was decided that Germany was to repay $1.1 billion of the aid it had received. The last repayment was made in June 1971.[10]

The Korean war (1950-53) led to a worldwide increased demand for goods, and the resulting shortage helped overcome lingering resistance to the purchase of German products. At the time Germany had a large pool of skilled and cheap labour, partly as a result of the deportations and migrations which affected up to 16.5 million Germans. This helped Germany to more than double the value of its exports during the war. Apart from these factors, hard work and long hours at full capacity among the population and in the late 1950's and 1960's extra labour supplied by thousands of Gastarbeiter ("guest workers") provided a vital base for the economic upturn.

From the late 1950s onwards, West Germany had one of the strongest economies in the world, almost as strong as before the Second World War. The East German economy showed strong growth, but not as much as in West Germany, due in part to continued reparations to the USSR in terms of resources.

Ludwig Erhard, who served as the Minister of the Economy in Adenauer's cabinet from 1949 until 1963 and later became Chancellor, is often associated with the German Wirtschaftswunder.

[edit] Austria

Austria was also included in the Marshall Plan and can thus be included in any consideration of the Wirtschaftswunder. Through the nationalisation of some industries (VOEST, AMAG) and yet more long working hours, full economic capacity was reached. Using West Germany as a guide, the currency was stabilised when the schilling was reintroduced in place of the Reichsmark. This economic policy was known in journalistic circles as the Raab-Kamitz-Kurs, named after Chancellor Julius Raab and his Finance Minister Reinhard Kamitz similar to the German Adenauer-Erhard-Kurs.

In the 1950s the first Gastarbeiter from Southern Italy and Greece arrived in the country, as more manual labour was required to maintain the economic upswing.

[edit] Notes

  1. ^ Frederick H. Gareau "Morgenthau's Plan for Industrial Disarmament in Germany" The Western Political Quarterly, Vol. 14, No. 2 (Jun., 1961), pp. 517-534
  2. ^ C. Lester Walker "Secrets By The Thousands", Harper's Magazine. October 1946
  3. ^ Norman M. Naimark The Russians in Germany pg. 206. (Naimark refers to Gimbels book)
  4. ^ The $10 billion compares to the U.S. annual GDP of $258 billion in 1948.
  5. ^ The $10 billion compares to the total Marshall plan expenditure (1948-1952) of $13 billion, of which Germany received $1,4 billion (partly as loans).
  6. ^ "Pas de Pagaille!", July 28, 1947
  7. ^ German Economic "Miracle" by David R. Henderson
  8. ^ "Marshall Plan 1947-1997 A German View" by Susan Stern
  9. ^ German Economic "Miracle" by David R. Henderson
  10. ^ "Marshall Plan 1947-1997 A German View" by Susan Stern

[edit] See also

[edit] External links

Retrieved from "http://en.wikipedia.org../../../w/i/r/Wirtschaftswunder.html"