Life in the FRG

Life in the FRG

1. The 'Economic miracle'

   • Free economy with a social conscience --> Capitalism at heart
   • Erhard --> Symbol of the economic miracle
     • 1949-63 --> Minister of economics
     • 1957+ --> Vice chancellor
     • 1963-66 --> Chancellor
   • Rising consumption and economic growth were the key aims
   • Problems
     • Not immediate
     • Price rises not matched by wage rises
     • Shortages of some resources (eg:coal)
     • Initial increase in imports if led to serious balance of payments deficit
     • 1950 --> High unemployment (13.5%

2. Statistics showing how recovery had begun by 1952

   • 1950-55 --> GNP doubled then increased by 50% again by 1960
   • Economic growth averaged at 8% per year --> 2-3% now seen as pleasing Britain
   • 1955 --> unemployment down to 4.2% and then full employment even finding work for the refugees (3million)
   • 1950 --> balance of trade became positive due to rapid growth of exports
     • 1954 --> FRG was 3rd biggest trading power
   • Agriculture = one area of mixed fortunes
     • 1950-60 --> proportion of people working in this industry

3. Reasons for the 'economic miracle'

   • Erhard's reforms including currency reform
   • Population was well educated and skilled
   • Marshall plan
     • Refugees --> often well educated/ skilled
     • Government expenditure was low (no reparations or defense costs to pay)
     • Increased demand for capital and consumer goods
   • Effectiveness of Budesbank
     • World trade --> ECSC 1951 and EEC in 1957

4. Equalisation of Burdens law

   • Social policy
     • 131 law
       • Restored employment and pension
     • Women
       • Legally given equal rights by constitution
       • Law of Equality of the Sexes in 1957 gave women the right to seek employment without the consent of their husbands
       • More opportunities for women due to expanding admin and service sector
       • BUT
         • Not paid equally (40% less than men)
         • Not equal in numbers in higher education (19% in 1950, 30% in 1968)
         • Still largely traditional and conservative in their view towards women
     • Living standards
       • Up to 1955
         • 20% still living at basic subsistance level
         • Over 50% living in a one bed flat/ house
         • Average working week = 49 hrs
         • + than 1/3 had never had a holiday
       • 1965 --> 40 hr working week had been establised, more consumer goods + more private housing
   • Intregration of the unions
     • Results- Trade Unions stepped back from politics
     • Works constitution law 1952 --> created a work council for all companies with more than 500 employees
     • The Trade Union system was simplified in 1949, with the creation of 16 worker unions. Covered by one umbrella organisation (The German Federation of Trade Unions)
     • Co-determination law of 1951 --> gave workers reps on managerial boards in coal, iron and steel
   • Welfare state
     • State supported new housing
     • Public assistance for the desperate
     • Pensions reformed in 1957. Pension was 60% of someone's earnings (in the UK it was 29%)
     • Unemployment benefit
     • Accident insurance
       • Sickness insurance --> much improved in 1957
   • Education
     • Abolition fees (1958) and Dusseldor agreement, led to organisation of school holidays, school years and examinations subjects
     • Many practicle issues due to lack of resources and staff
     • Responsibility passed to Lander
     • Reformed in the mid 60's
   • Introduced property levy on money and real estate not affected by war to give something to those suffering heavy loss. 143 billion Deutche marks redistributed in 30 years

5. Foreign policy

   • Adenauer's key aim: Maintaining peace and freedom of the FRG
     • Wanted to establish sovereignty
     • Exploiting the economic, political and military strength of the West through intergration
     • Opposing attempts at reunification in FRG left neutral as could be preyed on by communism
   • ECSC European Coal and Steel community
     • No restrictions on imports and exports of it's members
     • Common policy for prices+ subsidies
       • Every country could trade amongst theirselves freely
     • Complete success (1952) coal and steel increased by 44%
   • EEC
     • Created in 1957 to harmonise measures of the trade prices
     • Known as the common market and gave FRG a chance to exert some influence
   • Military and political intergration
     • Outbreak of the Chinese revolution (1949) and Korean War (1950) heightened fears of Communism and perhaps European powers are more open to the FRG
     • Occupational law ended 1955 and FRG became a soverign sate
     • Defense Pact, West European Union, expanded to include FRG. Allowed FRG an army
     • FRG allowed to join NATO in 1955
     • 1963 --> French-German treaty signed
   • Realtions with the GDR
     • No official diplomatic relations between the two
     • Referred to as the 'soviet occupied zone'
     • People spoke of GDR derisivley
     • 'Magnet theory' --> confirmed as 3 million fled to the FRG
     • Stalin notes --> GDR offered a reunification settlement that was rejected by the FRG
     • Hallstein Doctrine --> stated A would refuse to have diplomatic relations with any country accept USSR who acknowledged the GDR. Only Yugoslavia and Cuba broke relations

6. Adenauer's fall from power

   • Presidency Fiasco
     • Spring 1959 --> Heuss retired from presidency
     • Adenauer under encouragement to put himself forward for the role
     • Then withdrew from the role --> he realised that the role of president wouldn't give him a powerful say in policy making
     • He also wanted to block Erhard as Chancellor
     • Adenauer loses credibility as a result of this episode, he is seen to be damaging to the role of his own gais. Many wanted him out of the Chancellorship position
   • TV dispute
     • Adenauer set up a TV company --> Deutschland Fernsehen-GmbH which was controlled by federal govt.
     • SPD attacked Adenauer --> threatened govt. in and freedom of media
     • Feb 1961 --> Company decalred unconstitutional
     • His opponents used the opportunity to attack his style of govt. for being too controling --> consider the impact of post-Weimar
   • Berlin Wall and the following election in 1961
     • 1961 election --> SPD vs CDU
     • Polls implied that Adenauer was still favoured over the SDP leader, Willy Brent due to his experience
     • GDR erected the Berlin Wall during election campaigning --> Adenauer ignored this rather than Defend West Berlin
     • --> agreed on the condition that A stepped down from the leadership role within the next 4 yrs
   • Der Spiegel affair
     • Der Spiegel = left wing newspaper
     • Criticised foreign policy od Strauss, Leader of the CSU amd minister of defence
     • 10th Oct 1962, the paper published an article about NATO military plans in the event of an attack by the Eastern block
     • The writer, editor were arrested and charged treason+corruption seen as heavy - handed an attempt
     • Resignation
       • As a result of the affair, Adenauer had promised to stand down
       • In the Lander Elections on 1963, the CDU lost many votes and the party began to ask for a grand coalition with the SDP
       • April 1963 --> A was forced to accept erhard as a successor
       • Oct 63 --> Adenauer resigns aged 87
       • Kept his seat in parliament and his leadership of the CDU