- Basic Law created a new government structure and committed the FRG to work for reunification
- CDU came to power with only 31% of the vote in 1949
- First elections had seen political extremists competing for influence and political fragmentation looked likely. However, anti-democratic parties were outlawed, (SRP 1952 and KPD 1956) and the introduction of a 5% hurdle limited this possibility.
- The coalition proved that it was capable of intergrating a wide range of political views, and took advantage of the large proportion of Catholics in the FRG, although Adenaur was careful to ensure the CDU was perceived as a Christian organisation rather than Catholic. By 1953 it was clear that democracy was working.
- Construction Law (1950) - generous grants which provided 4 million new dwellings by 1957 and Refugees and Expellees were slowly intergrated into German society.
- Equalisation of Burdens Act (1953) compensation to the victims of wartime bombing campaigns, raised by a 50% tax over 30 years on land, building and capital assests based on 1948 values.By 1978, 110.4 billion DM had been redistributed.
- Collective Bargaining Law on Industrial Relations (1949) which allowed for 'co-determination' and better relations between workers and employers. Works Constitution Law (1952) extended workers councils throughout industry.
- Pensions Act (1957) increased pensions by 60-75%
- Creation of the 'citizens army' or 'bundeswehr' in 1956 to defend the democratic values of the state.
- Bonn Convention 1957 - FRG becomes soverign and joins the EDC.
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Adenauer's longevity as Chancellor
- Attractions and success of his government + policies.
- 'Keine Experimente' - 'No experiments'
- 'Ohne Mich' - 'Count me out' politics
- Anti-Communist sentiment of the 1950s encouraged by the Americanisation of society + Cold War
- SPD opposed Adenaur's 'West politics' and the EU. Main policy was a united and neutral state which was becoming increasingly unrealistic, and predictions of economic downturn were proved wrong. It had nothing to offer and there was an internal division over re-armament and remiliterisation and was seen as a working class party in a society becoming increasingly affluent
- By turning a blind eye to ex-Nazi pasts, Adenaner could draw on the talents of capable administrators and politicians. War criminals were slowly released back into civillian life and many crimes were never investigated. Reinstatement Act 1951 - Many ex-nazi's were re-employed in the civil service. In the early 50s, 40-80% of individuals were former members of the nazi party.
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- Economy grew by 30% between March and August 1948 as a result of currency reform and the end of price controls.
- By 1950 it looked like the economy was slowing down again. Unemployment reached 8.1%.
- Marshall Aid provided for 37% of imports and was used to improve railways and investment in electricals and steels.
- Erhard strong promoter of the 'free market' or a 'social market economy', where the economy was 'guided' in the right direction and was a 'third way' between a state controlled socialist economy and a free unregulated capitalist one. Buisnesses would be left to develop independantly, but the state would 'police' developments ensuring fair competition.
- Korean war in 1950 brought a rise in demand for German exports, however there was still a balance of payments deficit in 1951 as the cost of importing raw materials was higher.
- Investment aid Law 1951 - government offered 3.2 million Deutche Mark to manufacturing industry. Anti-trust Law (1957) or 'decartilisation' law and tight banking controls ensured Germany had a strong currency. Manufacturing industries allocated raw materials and Adenauers policy of co-determination ensured that Trade Unions were modest in their wage demands. With one union per industry and the DGB (German confederation of Trade Unions) as an umbrella organisation, a 'social partnership' between employees and employers could be fostered and produced a low strike record.
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Economic developments 2
- 1951 - Global boom and fall in prices of raw materials meant that Germany incurred an 'economic miracle'. Growth averaged 8% a year 1950-1955 and unemployment fell to 0.5%. Real incomes rose and so consumer demand grew to boost the internal market.
- Rebuilding of cities and homes led to provision of comfortable lifestyles, demand encouraged production and wages rose again.
- 'Wohlstand fur alle' - 'wealth for all'
- Country enjoyed natural advantages of seaports, communications, coal and other raw materials, including a well-educated and highly-skilled workforce, augmented by the influx of refugees. There was still a secure economic base on which to build. New complexes and factories were created from scratch and incorporated all the latest technonolgy.
- Did not have to side aside money for rearmament.
- Reintergration with Europe and working in the ECSC helped West Germany gain the maximum advantage from growing world trade.
- Agriculture was still heavily subsidised and loopholes allowed big buisnesses to flourish.
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The impact of economic and social developments
- Widened the gap between the rich and the poor, but this was masked by an overall rise in living standards
- Decrease in the number of self-employed workers in agriculture and commerce
- Narrowed gap in the lifestyle of the classes, so although workers wages remained low and wealth was concentrated in a few hands, there was a feeling of affluence.
- Average income increased by 400% between 1950 + 1970.
- Able to enjoy luxuries such as fridges, cars, holidays and TV's.
- This prosperity reinforced commitment to the CDU and to democracy in general. Also reinforced anti-communist standpoint and helped people favour Western intergration over reunification.
- Economic recovery made it easier to reintergrate expellees and refugees into German society but created an 'underclass' of 'Gastarbeiter' or guestworkers. By 1966 there were 1.2 million and made up 10% of Germany's workforce by the 1970s.
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