the country before 1945 ran it again in the 1950s.
Owners, managers and workers pulled together to
achieve better living standards. The watchword
was Wiedergutmachung, restitution. Pensions to
those who had helped Hitler were honoured;
refugees from the East received capital to start
again; those who had survived the war with prop-
erty intact were taxed to pay for this. Jewish
victims received some compensation and, for
those millions who had been murdered during
the war, the new State of Israel received a global
sum which, by 1980, amounted to nearly 3.5
billion DM. But despite the large sums paid they
could not match all the looted wealth or com-
pensate for millions of murders – though this was
not the view taken by many Germans at the
time. Nonetheless, Adenauer persistently backed
Wiedergutmachung as morally necessary, and
essential for the good name of the new Germany.
At the same time he defended the employment of
former high officials of the Nazi state, even
employing in his own office Hans Globke, the
civil servant who had helped to draft the
Nürnberg anti-Semitic laws in 1935. The past was
past and new loyalties were allowed to replace old
ones.
To one man in his Cabinet Adenauer owed
more than to any other. Ludwig Erhard, minister
of economic affairs, symbolised the new-found
German prosperity: jovial and rotund, he was
never seen in public without a fat cigar. A vote for
the CDU/CSU was as much a vote for Erhard
and his concept of the socially responsible market
economy as it was for Adenauer, the father figure,
the ‘helmsman’. How did the economic transfor-
mation come about? Erhard could only provide
the right conditions for workers and management
to create the export-led boom. It was the quality
and reliability of German manufacture, machine
tools, products of heavy engineering and cars that
brought success. It was also the willingness of the
trade union leaders to give up class warfare and for
two decades to restrain wage demands. Abroad
and at home there was an almost insatiable
appetite for capital goods and cars. The cities had
to be rebuilt. The ‘American dream’ propagated
by Hollywood created desires and expectations
that only hard work could fulfil. The change for
the better from the low point of 1945 to 1947 was
so dramatic by the mid-1950s that people spoke
of an ‘economic miracle’. Confidence in a better
future was rekindled.
The statistics in the accompanying tables reveal
the steady growth with unemployment falling to
negligible proportions in 1971, though inflation
increased from 1 per cent to 5 per cent in the
1960s. Unemployment was a particularly sensi-
tive issue in Germany. High unemployment in
1932–3 was widely credited with having made
possible the rise of Hitler. Could the democracy
of the Federal Republic survive high unemploy-
ment? Progress was not smooth: between 1954
and 1958 unemployment reached 7 per cent and
fell no lower than 4 per cent, which alarmed the
electorate; but thereafter from 1973 until the
1990s never exceeded 3 per cent, and for the
period 1961–6 it stayed below 1 per cent. The
shortage of workers was first filled by the steady
influx of refugees from the Soviet zone of
Germany and then increasingly from the pool of
unemployed in the Mediterranean countries,
especially Italy and Turkey. By 1973 there were
2.6 million Gastarbeiter(guestworkers) in the
Federal Republic. This availability of labour was
one reason for West Germany’s rapid indus-
trial expansion. Periodic boosts were given by
Marshall Aid, by the boom that followed the out-
break of the Korean War in 1950 and by the512 THE RECOVERY OF WESTERN EUROPE IN THE 1950s AND 1960s
West German industrial production indices, 1945/6–59 (1913 = 100)Coal Iron Steel Chemicals Cars
1945/6 18.7 10.9 14.6 – –
1950 58.3 49.1 69.1 240.6 936.6
1955 68.8 85.4 121.4 439.8 2,656.0
1959 66.1 95.3 147.3 630.9 4,266.0