German economic history Germany economy Cold War

German Economic History: Cold War (1945-91)

Figure 1.--European Communists after Stalin installed them with the reins of power had no doubt that socialism would enable them to finally achieve what they had long dreamed of to create worker paradises of unbrialed prosperity. Stalin believed the same. Only as their economies faltered, it was the capitalist West that achieved economic miracles. Germany led the way, not only rebuilding their cities, but achieving a level of prosperity never approached in all of history. And with it helping other countries like Italy achieve their own economic miracles. The press caption for this photigraoh read, "Small-fry Racing: As slick as Fangio's racing car looks this 27 ccm children -rader develops 0.7 horsepower. The Italian-made vehicle was on display in Frankfurt'sstreets for the first time and two unidentified boys felt like heros of a race track. The 500 dollar vehickle has one forward and one backward shift and develops a speed tat is twice a pedestrians walk. The Alpat Works at Torino. Italy manufavturs it." The photograph was dated June 12, 1957. It was a show piece, but their fathers thriughout Western Europe were able to purcgase family cars as well as homes as well as a host of consumer goods--items that Osties could only dream of possessing.

After World War II, many economists, viewing German cities turned into mounds of rubble, believed that it would take a generation For Germany to recover from the War. In the aftermath of World War II, the future of Germany and Europe itself was at issue. Stalin assumed that as after World War I, that the Americans would leave Europe. President Roosevelt who did mnot fully understand Stalin's ambitions and capabilities and capabilities told him as much at Yalta. But even after the Americans decided to remain, Stalin and other European Communists were sure that the inherent superiority of socialist economics would enable them to overcome the cpitalist West. The choice was between the Soviet totalitarian, Marrxist model and the American democratic capitalist model. The problem was that it was socialism proved to have inherent weaknesses. The issue was decided by the free market policies adopted by German politicans and American occupation authorities. Soviet authorities as well as Socialist politicans and labor unions in the West opposed the reforms which were designed to create a strong Deutch Mark. The currency reforms for Soviet officiasls was the final straw leading to a formal break in any effort to cooperate in the occupation of Germany. The result was the German Economic Miracle (1950s). The economic failure of Communist East Germany was in stark contrast to the success of capitalusm in the west. East German Cpomunists could not explain their moribond economy. They could not brin themselves to question Communism. The leadership dciuded that a Wall would solve their problems or a t least make it impossible foe workers to cjose the West and capitalism. This was largely ignored in the developing world with tragic consequences, but it played a major role in Europe which from the beginning was the key basttle ground of the Cold War.

CIH -- Cold War

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Created: 2:02 AM 11/12/2018
Last updated: 2:02 AM 11/12/2018