Experts assess cost of reunification
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Twenty years ago today (November 9), Germans peacefully brought down the ‘Iron Curtain’ that had divided the country for 28 years when they chiseled a hole in the Berlin Wall.
It was the start of Germany’s reunification and the end of Soviet communism in Europe.
The uprisings began in Poland and Hungary, but the fall of the Berlin Wall has become synonymous with the fall of communism and the end of the Cold War.
“These countries were giant prisons that kept their populations captive, and like most prisons they provided food and shelter but denied liberty,” says Nicholas Redman, the economist for Eastern Europe at the Economist Intelligence Unit.
Without exception, he says, people in these countries have greater freedom. Converting to capitalism has made life tougher. But more rewarding.
Karl-Heinz Brodbeck, an economics professor at the University of Applied Sciences, Würzburg, says the Stalinist economy was destroyed from within as resources were channelled away from public welfare to finance military competition with the West.
Ludwig Erhard, a former minister of economic affairs, and the architect of West Germany’s post-war recovery, predicted a second “economic miracle”.
However, Konrad Adenauer, West Germany’s first chancellor and a key figure in rebuilding the country, warned of the high costs of the reunification.
Werner Abelshauser, a professor for economic history at the University of Bielefeld, says the country is today much weaker than West Germany used to be.
The cost of the reunification has, so far, reached €1.3 trillion (£1.2 trillion). For Germans, however, it was priceless.
