Germany during the Cold War

Germany during the Cold War, 1945–1990
As a consequence of the defeat of Nazi Germany in 1945 and the onset of the Cold War in 1947, the country was split between the two global blocs in the East and West, a period known as the division of Germany. Millions of refugees from Central and Eastern Europe moved west, most of them to West Germany. Two states emerged: West Germanywas a parliamentary democracy, a NATOmember, a founding member of what since became the European Union and one of the world's largest economies, while East Germany was a totalitarian Communist dictatorship that was a satellite of Moscow. With the collapse of Communism in 1989, reunion on West Germany's terms followed.
No one doubted Germany's economic and engineering prowess; the question was how long bitter memories of the war would cause Europeans to distrust Germany, and whether Germany could demonstrate it had rejected totalitarianism and militarism and embraced democracy and human rights.[204]
Post-war chaos Edit
Further information: Office of Military Government, United States

Devastation in Berlin after the Second World War, 1945
The total of German war dead was 8% to 10% out of a prewar population of 69,000,000, or between 5.5 million and 7 million people. This included 4.5 million in the military, and between 1 and 2 million civilians. There was chaos as 11 million foreign workers and POWs left, while 14 million displaced refugees from the east and soldiers returned home.[205]During the Cold War, the West Germangovernment estimated a death toll of 2.2 million civilians due to the flight and expulsion of Germans and through forced labour in the Soviet Union.[206] This figure remained unchallenged until the 1990s, when some historians put the death toll at 500,000–600,000 confirmed deaths.[207] In 2006 the German government reaffirmed its position that 2.0–2.5 million deaths occurred.

Occupation zone borders after 1945. Berlin, although within the Soviet zone, was also divided among the four powers. The areas in white to the east were given to Poland and the Soviet Union (now Russia)
At the Potsdam Conference, Germany was divided into four military occupation zones by the Allies and did not regain independence until 1949. The provinces east of the Oder and Neisse rivers (the Oder-Neisse line) were transferred to Poland, Lithuania,[208] and Russia (Kaliningrad oblast); the 6.7 million Germans living in Poland and the 2.5 million in Czechoslovakia were forced to move west, although most had already left when the war ended.[209]
Denazification removed, imprisoned, or executed most top officials of the old regime, but most middle and lower ranks of civilian officialdom were not seriously affected. In accordance with the Allied agreement made at the Yalta conference millions of POWs were used as forced labor by the Soviet Union and other European countries.[210]
In the East, the Soviets crushed dissent and imposed another police state, often employing ex-Nazis in the dreaded Stasi. The Soviets extracted about 23% of the East German GNP for reparations, while in the West reparations were a minor factor.[211]
In 1945–46 housing and food conditions were bad, as the disruption of transport, markets, and finances slowed a return to normal. In the West, bombing had destroyed the fourth of the housing stock,[212] and over 10 million refugees from the east had crowded in, most living in camps.[213] Food production in 1946–48 was only two-thirds of the prewar level, while grain and meat shipments – which usually supplied 25% of the food – no longer arrived from the East. Furthermore, the end of the war brought the end of large shipments of food seized from occupied nations that had sustained Germany during the war. Coal production was down 60%, which had cascading negative effects on railroads, heavy industry, and heating.[214] Industrial production fell more than half and reached prewar levels only at the end of 1949.[215]
Allied economic policy originally was one of industrial disarmament plus building the agricultural sector. In the western sectors, most of the industrial plants had minimal bomb damage and the Allies dismantled 5% of the industrial plants for reparations.[216]
However, deindustrialization became impractical and the U.S. instead called for a strong industrial base in Germany so it could stimulate European economic recovery.[217]The U.S. shipped food in 1945–47 and made a $600 million loan in 1947 to rebuild German industry. By May 1946 the removal of machinery had ended, thanks to lobbying by the U.S. Army. The Truman administration finally realised that economic recovery in Europe could not go forward without the reconstruction of the German industrial base on which it had previously been dependent. Washington decided that an "orderly, prosperous Europe requires the economic contributions of a stable and productive Germany."[218][219]
In 1945 the occupying powers took over all newspapers in Germany and purged them of Nazi influence. The American occupation headquarters, the Office of Military Government, United States (OMGUS) began its own newspaper based in Munich, Die Neue Zeitung. It was edited by German and Jewish émigrés who fled to the United States before the war. Its mission was to encourage democracy by exposing Germans to how American culture operated. The paper was filled with details on American sports, politics, business, Hollywood, and fashions, as well as international affairs.[220]
East Germany Edit
Main articles: East Germany and History of East Germany

Erich Honecker and guests of honor like Mikhail Gorbachev celebrate the 40th (and last) anniversary of the socialist regime of the German Democratic Republic on 7 October 1989.
In 1949 the Soviet zone became the "Deutsche Demokratische Republik" – "DDR" ("German Democratic Republic" – "GDR", simply often "East Germany"), under control of the Socialist Unity Party. Neither country had a significant army until the 1950s, but East Germany built the Stasi into a powerful secret police that infiltrated every aspect of the society.[221]
East Germany was an Eastern bloc state under political and military control of the Soviet Union through her occupation forces and the Warsaw Treaty. Political power was solely executed by leading members (Politburo) of the communist-controlled Socialist Unity Party (SED). A Soviet-style command economy was set up; later the GDR became the most advanced Comecon state. While East German propaganda was based on the benefits of the GDR's social programs and the alleged constant threat of a West German invasion, many of her citizens looked to the West for political freedoms and economic prosperity.[222]
Walter Ulbricht (1893–1973) was the party boss from 1950 to 1971. In 1933, Ulbricht had fled to Moscow, where he served as a Comintern agent loyal to Stalin. As World War II was ending, Stalin assigned him the job of designing the postwar German system that would centralize all power in the Communist Party. Ulbricht became deputy prime minister in 1949 and secretary (chief executive) of the Socialist Unity (Communist) party in 1950.[223]Some 2.6 million people had fled East Germany by 1961 when he built the Berlin Wallto stop them — shooting those who attempted it. What the GDR called the "Anti-Fascist Protective Wall" was a major embarrassment for the program during the Cold War, but it did stabilize East Germany and postpone its collapse.[224][225] Ulbricht lost power in 1971, but was kept on as a nominal head of state. He was replaced because he failed to solve growing national crises, such as the worsening economy in 1969–70, the fear of another popular uprising as had occurred in 1953, and the disgruntlement between Moscow and Berlin caused by Ulbricht's détente policies toward the West.
The transition to Erich Honecker (General Secretary from 1971 to 1989) led to a change in the direction of national policy and efforts by the Politburo to pay closer attention to the grievances of the proletariat. Honecker's plans were not successful, however, with the dissent growing among East Germany's population.
In 1989, the socialist regime collapsed after 40 years, despite its omnipresent secret police, the Stasi. Main reasons for the collapse include severe economic problems and growing emigration towards the West.
East Germany's culture was shaped by Communism and particularly Stalinism. It was characterized by East German psychoanalyst Hans-Joachim Maaz in 1990 as having produced a "Congested Feeling" among Germans in the East as a result of Communist policies criminalizing personal expression that deviates from government approved ideals, and through the enforcement of Communist principals by physical force and intellectual repression by government agencies, particularly the Stasi.[226] Critics of the East German state have claimed that the state's commitment to communism was a hollow and cynical tool of a ruling elite. This argument has been challenged by some scholars who claim that the Party was committed to the advance of scientific knowledge, economic development, and social progress. However, the vast majority regarded the state's Communist ideals to be nothing more than a deceptive method for government control.[226]
According to German historian Jürgen Kocka(2010):
Conceptualizing the GDR as a dictatorship has become widely accepted, while the meaning of the concept dictatorship varies. Massive evidence has been collected that proves the repressive, undemocratic, illiberal, nonpluralistic character of the GDR regime and its ruling party.[227]
West Germany (Bonn Republic) Edit

Flag of West Germany and unified Germany,
1949 – present
Main article: West Germany
In 1949, the three western occupation zones(American, British, and French) were combined into the Federal Republic of Germany (FRG, West Germany). The government was formed under Chancellor Konrad Adenauer and his conservative CDU/CSU coalition.[228] The CDU/CSU was in power during most of the period since 1949. The capital was Bonn until it was moved to Berlin in 1990. In 1990 FRG absorbed East Germany and gained full sovereignty over Berlin. At all points West Germany was much larger and richer than East Germany, which became a dictatorship under the control of the Communist Party and was closely monitored by Moscow. Germany, especially Berlin, was a cockpit of the Cold War, with NATO and the Warsaw Pact assembling major military forces in west and east. However, there was never any combat.[229]
Economic miracle Edit

The Volkswagen Beetle was an icon of West German reconstruction.
West Germany enjoyed prolonged economic growth beginning in the early 1950s (Wirtschaftswunder or "Economic Miracle").[230] Industrial production doubled from 1950 to 1957, and gross national product grew at a rate of 9 or 10% per year, providing the engine for economic growth of all of Western Europe. Labor union supported the new policies with postponed wage increases, minimized strikes, support for technological modernization, and a policy of co-determination (Mitbestimmung), which involved a satisfactory grievance resolution system as well as requiring representation of workers on the boards of large corporations.[231] The recovery was accelerated by the currency reform of June 1948, U.S. gifts of $1.4 billion as part of the Marshall Plan, the breaking down of old trade barriers and traditional practices, and the opening of the global market.[232] West Germany gained legitimacy and respect, as it shed the horrible reputation Germany had gained under the Nazis.
West Germany played a central role in the creation of European cooperation; it joined NATO in 1955 and was a founding member of the European Economic Community in 1958.
1948 currency reform Edit

Berliners watching a transport bringing food and coal during the Berlin Blockade of 1948–49
The most dramatic and successful policy event was the currency reform of 1948.[233]Since the 1930s, prices and wages had been controlled, but money had been plentiful. That meant that people had accumulated large paper assets, and that official prices and wages did not reflect reality, as the black market dominated the economy and more than half of all transactions were taking place unofficially. On 21 June 1948, the Western Allies withdrew the old currency and replaced it with the new Deutsche Mark at the rate of 1 new per 10 old. This wiped out 90% of government and private debt, as well as private savings. Prices were decontrolled, and labor unions agreed to accept a 15% wage increase, despite the 25% rise in prices. The result was that prices of German export products held steady, while profits and earnings from exports soared and were poured back into the economy. The currency reforms were simultaneous with the $1.4 billion in Marshall Plan money coming in from the United States, which was used primarily for investment.
In addition, the Marshall Plan forced German companies, as well as those in all of Western Europe, to modernize their business practices and take account of the international market. Marshall Plan funding helped overcome bottlenecks in the surging economy caused by remaining controls (which were removed in 1949), and Marshall Plan business reforms opened up a greatly expanded market for German exports. Overnight, consumer goods appeared in the stores, because they could be sold for realistic prices, emphasizing to Germans that their economy had turned a corner.[213]
The success of the currency reform angered the Soviets, who cut off all road, rail, and canal links between the western zones and West Berlin. This was the Berlin Blockade, which lasted from 24 June 1948 to 12 May 1949. In response, the U.S. and Britain launched an airlift of food and coal and distributed the new currency in West Berlin as well. The city thereby became economically integrated into West Germany.[234]
Adenauer Edit

Adenauer in 1952; he forged close ties with France and the U.S. and opposed the Soviet Union and its satellite of East Germany
Konrad Adenauer (1876–1967) was the dominant leader in West Germany.[235] He was the first chancellor (top official) of the FRG, 1949–63, and until his death was the founder and leader of the Christian Democratic Union (CDU), a coalition of conservatives, ordoliberals, and adherents of Protestant and Catholic social teaching that dominated West Germany politics for most of its history. During his chancellorship, the West Germany economy grew quickly, and West Germany established friendly relations with France, participated in the emerging European Union, established the country's armed forces (the Bundeswehr), and became a pillar of NATO as well as firm ally of the United States. Adenauer's government also commenced the long process of reconciliation with the Jews and Israel after the Holocaust.[236]
Erhard Edit
Ludwig Erhard (1897–1977) was in charge of economic policy as economics director for the British and American occupation zones and was Adenauer's long-time economics minister. Erhard's decision to lift many price controls in 1948 (despite opposition from both the social democratic opposition and Allied authorities), plus his advocacy of free markets, helped set the Federal Republic on its strong growth from wartime devastation.[237] Norbert Walter, a former chief economist at Deutsche Bank, argues that "Germany owes its rapid economic advance after World War II to the system of the Social Market Economy, established by Ludwig Erhard."[238][239] Erhard was politically less successful when he served as the CDU Chancellor from 1963 until 1966. Erhard followed the concept of a social market economy, and was in close touch with professional economists. Erhard viewed the market itself as social and supported only a minimum of welfare legislation. However, Erhard suffered a series of decisive defeats in his effort to create a free, competitive economy in 1957; he had to compromise on such key issues as the anti-cartel legislation. Thereafter, the West German economy evolved into a conventional west European welfare state.[240]
Meanwhile, in adopting the Godesberg Program in 1959, the Social Democratic Party of Germany (SPD) largely abandoned Marxism ideas and embraced the concept of the market economy and the welfare state. Instead it now sought to move beyond its old working class base to appeal the full spectrum of potential voters, including the middle class and professionals. Labor unions cooperated increasingly with industry, achieving labor representation on corporate boards and increases in wages and benefits.[241]
Grand coalition Edit

Willy Brandt (1913–1992), German Chancellor and Nobel Peace Prize laureate of 1971
In 1966 Erhard lost support and Kurt Kiesinger(1904–1988) was elected as Chancellor by a new CDU/CSU-SPD alliance combining the two largest parties. Socialist (SPD) leader Willy Brandt was Deputy Federal Chancellor and Foreign Minister. The Grand Coalition lasted 1966–69 and is best known for reducing tensions with the Soviet bloc nations and establishing diplomatic relations with Czechoslovakia, Romania and Yugoslavia.
Guest workers Edit
Main article: Gastarbeiter
With a booming economy short of unskilled workers, especially after the Berlin Wall cut off the steady flow of East Germans, the FRG negotiated migration agreements with Italy (1955), Spain (1960), Greece (1960), and Turkey (1961) that brought in hundreds of thousands of temporary guest workers, called Gastarbeiter. In 1968 the FRG signed a guest worker agreement with Yugoslavia that employed additional guest workers. Gastarbeiter were young men who were paid full-scale wages and benefits, but were expected to return home in a few years.[242]
The agreement with Turkey ended in 1973 but few workers returned because there were few good jobs in Turkey.[243] By 2010 there were about 4 million people of Turkish descent in Germany. The generation born in Germany attended German schools, but had a poor command of either German or Turkish, and had either low-skilled jobs or were unemployed.[244][245]
Brandt and Ostpolitik Edit
Main article: Ostpolitik

Brandt (left) and Willi Stoph in 1970, the first encounter of a Federal Chancellor with his East German counterpart
Willy Brandt (1913–1992) was the leader of the Social Democratic Party in 1964–87 and West German Chancellor in 1969–1974. Under his leadership, the German government sought to reduce tensions with the Soviet Union and improve relations with the German Democratic Republic, a policy known as the Ostpolitik.[230] Relations between the two German states had been icy at best, with propaganda barrages in each direction. The heavy outflow of talent from East Germany prompted the building of the Berlin Wall in 1961, which worsened Cold War tensions and prevented East Germans from travel. Although anxious to relieve serious hardships for divided families and to reduce friction, Brandt's Ostpolitik was intent on holding to its concept of "two German states in one German nation."
Ostpolitik was opposed by the conservative elements in Germany, but won Brandt an international reputation and the Nobel Peace Prize in 1971.[246] In September 1973, both West and East Germany were admitted to the United Nations. The two countries exchanged permanent representatives in 1974, and, in 1987, East Germany's leader Erich Honeckerpaid an official state visit to West Germany.[247]

Two Germanys joining UN (1973)
Economic crisis of 1970s Edit
See also: Steel crisis

Helmut Schmidt, left, with French President Valéry Giscard d'Estaing(1977)
After 1973, Germany was hard hit by a worldwide economic crisis, soaring oil prices, and stubbornly high unemployment, which jumped from 300,000 in 1973 to 1.1 million in 1975. The Ruhr region was hardest hit, as its easy-to-reach coal mines petered out, and expensive German coal was no longer competitive. Likewise the Ruhr steel industry went into sharp decline, as its prices were undercut by lower-cost suppliers such as Japan. The welfare system provided a safety net for the large number of unemployed workers, and many factories reduce their labor force and began to concentrate on high-profit specialty items. After 1990 the Ruhr moved into service industries and high technology. Cleaning up the heavy air and water pollution became a major industry in its own right. Meanwhile, formerly rural Bavaria became a high-tech center of industry.[216]
A spy scandal forced Brandt to step down as Chancellor while remaining as party leader. He was replaced by Helmut Schmidt (b. 1918), of the SPD, who served as Chancellor in 1974–1982. Schmidt continued the Ostpolitik with less enthusiasm. He had a PhD in economics and was more interested in domestic issues, such as reducing inflation. The debt grew rapidly as he borrowed to cover the cost of the ever more expensive welfare state.[248]After 1979, foreign policy issues grew central as the Cold War turned hot again. The German peace movement mobilized hundreds of thousands of demonstrators to protest against American deployment in Europe of new medium-range ballistic missiles. Schmidt supported the deployment but was opposed by the left wing of the SPD and by Brandt.
The pro-business Free Democratic Party (FDP) had been in coalition with the SPD, but now it changed direction.[249] Led by Finance Minister Otto Graf Lambsdorff (1926–2009) the FDP adopted the market-oriented "Kiel Theses" in 1977; it rejected the Keynesian emphasis on consumer demand, and proposed to reduce social welfare spending, and try to introduce policies to stimulate production and facilitate jobs. Lambsdorff argued that the result would be economic growth, which would itself solve both the social problems and the financial problems. As a consequence, the FDP switched allegiance to the CDU and Schmidt lost his parliamentary majority in 1982. For the only time in West Germany's history, the government fell on a vote of no confidence.[213][250]
Kohl Edit

Helmut Kohl became first chancellor of a reunified Germany.
Helmut Kohl (b. 1930) brought the conservatives back to power with a CDU/CSU-FDP coalition in 1982, and served as Chancellor until 1998.[230] After repeated victories in 1983, 1987, 1990 and 1994 he was finally defeated by a landslide that was the biggest on record, for the left in the 1998 federal elections, and was succeeded as Chancellor by Gerhard Schröder of the SPD. Kohl is best known for orchestrating reunification with the approval of all the Four Powers from World War II, who still had a voice in German affairs.[251]
Reunification Edit
Main article: German reunification

The fall of the Berlin Wall, November 1989
During the summer of 1989, rapid changes known as peaceful revolution or Die Wendetook place in East Germany, which quickly led to German reunification.[230] Growing numbers of East Germans emigrated to West Germany, many via Hungary after Hungary's reformist government opened its borders. Thousands of East Germans also tried to reach the West by staging sit-ins at West German diplomatic facilities in other East European capitals, most notably in Prague. The exodus generated demands within East Germany for political change, and mass demonstrations in several cities continued to grow.
Unable to stop the growing civil unrest, Erich Honecker was forced to resign in October, and on 9 November, East German authorities unexpectedly allowed East German citizens to enter West Berlin and West Germany. Hundreds of thousands of people took advantage of the opportunity; new crossing points were opened in the Berlin Wall and along the border with West Germany. This led to the acceleration of the process of reforms in East Germany that ended with the German reunification that came into force on 3 October 1990.[252]