Wirtschaftswunder
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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.
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[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. The Allied dismantling of the West German coal and steel industry finally ended in 1950.
In addition to the physical hinders 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 huge value, all German patents, both in Germany and abroad, and used them to strengthen their own industrial competitivenes by licensing them to Allied companies.[1][2] Meanwhile some of the best German researchers were being put to work in the Soviet Union and in the U.S.[3]
Contrary to popular belief, the Marshall Plan, which was extended to also include the newly formed West Germany in 1949, was not the main force behind the Wirtschaftswunder.<ref>German Economic "Miracle" by David R. Henderson</ref><ref>"Marshall Plan 1947-1997 A German View" by Susan Stern</ref> Had that been the case, other countries such as Great Britain and France (which both received higher economic assistance 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 Marshal plan was by far overshadowed by the amount the Germans meanwhile had to pay as war-reparations and by the charges the Allies made on the Germans for the ongoing cost of occupation ($ 2.4 billion per year). 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.<ref>Ibid</ref>
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 and aping 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
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[edit] See also
- Celtic Tiger
- East Asian Tigers
- Japanese post-war economic miracle
- Miracle of Chile
- Spanish miracle
- Morgenthau Plan
- Marshall plan
- GARIOA
[edit] External links
- German Economic "Miracle" - The library of economics and liberty
- Rebuilding Germany
- Interview with Gunther Harkort Representative of the Federal Republic of Germany to the Economic Cooperation Administration (ECA), 1949-52.
- Interview with General Lucius D. Clay Deputy to General Eisenhower, 1945; deputy military governor, Germany (U.S.) 1946; commander in chief, U.S. Forces in Europe and military governor, U.S. Zone, Germany, 1947-49; retired 1949.
- Interview with General William Henry Draper Jr. Chief, Economics Division, Control Council for Germany, 1945-46; Military Government Adviser to the Secretary of State, Moscow Conference of Foreign Ministers, 1947; Under Secretary of War, 1947; Under Secretary of the Army, 1947-49;
- 'Time Magazine Faceless Crisis' Apr. 4, 1949
- Letter from Konrad Adenauer to Robert Schuman (26 July 1949) Warning him of the consequences of the dismantling policy. (requires Flash Player)
- Picture of demonstration against dismantling (7 June 1949) Workers in the Ruhr demonstrate against the dismantling of their factories by the Allied forces of occupation. (requires Flash Player)
- Picture: dismantling the Iron and Steel Industry ‘We want to work, we will help you to rebuild Europe' Workers at dismantled plant protest. (requires Flash Player)
- Picture: 12,000 factory workers demonstrate against the dismantling of German industry (19 August 1949) (requires Flash Player)de:Wirtschaftswunder
es:Milagro alemán fr:Wirtschaftswunder lt:Ekonomikos stebuklas nl:Wederopbouw fi:Wirtschaftswunder sv:Wirtschaftswunder
