Kazuhisa HIRAOKA
Jan 2 · Last update 3 mo. ago.

How can we resolve the East-West gap in Germany?

Soon after the fall of Berlin Wall in November 1989 and the reunification of Germany in October 1990, people with joy of the Peaceful Revolution had to face the daunting reality in the deteriorating economy. This is especially true for those who lived in the former German Democratic Republic (GDR). The improper exchange rate of the East Mark to the West D-Mark raised the wages in the East because of a 300-400% increase in the value of the former East German currency, and it therefore weakened the competitive power of the eastern industries along with a stronger D-Mark. The Treuhandanstalt agency was established with the intention of overseeing the privatization of eastern firms and land to recover flexibility and efficiency of the eastern economy. However, due to a series of the restructure, the surging unemployment rate in the eastern states deteriorated within a couple of years. Moreover, people suffered from inflation caused by increased consumer spending. The gap in economic strength between West and East Germany narrowed significantly at first, though the economic growth in East Germany stunted in the mid-1990s. Instead of a rosy future (“blooming landscapes”) which politicians in West Germany promised, Germany as a whole had to endure the burden of the reunification as the “sick of Europe” throughout the 1990s. The German economy regained its competitiveness in the mid-2000s, and the East-West gap has been narrowing slowly but steadily ever since. However, the gaps still exist, and many surveys suggest that the eastern states lag behind the western states in Germany. In such a situation, the financial aid schemes for the solidarity of Germany are coming to an end one after another from the beginning of 2020. theconversation.com/30-years-after-the-berlin-wall-came-down-east-and-west-germany-are-still-divided-126589 theconversation.com/how-divisions-between-east-and-west-germany-persist-30-years-after-reunification-126297 Annual Report of the Federal Government on the Status of German Unity 2018 (bmwi.de/Redaktion/EN/Publikationen/jahresbericht-zum-stand-der-deutschen-einheit-2018.pdf?__blob=publicationFile&v=3) iwh-halle.de/en/publications/detail/Publication/united-country-three-decades-after-the-wall-came-down-1
Stats of Viewpoints
Time is the great healer. They’ll get over their differences eventually.
0 agrees
0 disagrees
We should know Ossis (East Germans) well.
0 agrees
0 disagrees
The German federal government should establish another more elaborate financial scheme.
0 agrees
0 disagrees
Viewpoints
Add New Viewpoint

Time is the great healer. They’ll get over their differences eventually.

Many economic statistics indicate that the German East-West gap has been narrowing. Moreover, a psychological long-term study conducted by Elmar Brähler and his team suggests that the more the young post-Cold-War population has grown, the narrower the gap between Ossis (East Germans) and Wessis (West Germans) has become. Another interview article by Nele Templin and Antonia Grzelak pointed out the possibility of progressive evaporation of the gap during generational change. Therefore, as Professor Brähler pointed out, the gap will completely disappear or narrow down to be comparable to the gaps between cities or between the German federal states in the future (maybe after one generation or two).

userpage.fu-berlin.de/melab/wordpress/?p=4814 (in German) welt.de/gesundheit/psychologie/article147131006/So-sieht-es-in-der-Psyche-von-Ossi-und-Wessi-aus.html (in German)

Agree
Disagree
Latest conversation
Kazuhisa HIRAOKA
Jan 9
Approved
khiraokatrans edited this paragraph
Many economic statistics indicate that the German East-West gap has been narrowing. Moreover, a psychological long-term study conducted by Elmar Brähler and his team suggests that the more the young post-Cold-War population has grown, the narrower the gap between Ossis (East Germans) and Wessis (West Germans) has become. Another interview article by Nele Templin and Antonia Grzelak pointed out the possibility of progressive evaporation of the gap during generational change. Therefore, as Professor Brähler pointed out, the gap will completely disappear or narrow down to be comparable to the gaps between cities or between the German federal states in the future (maybe after one generation or two).

We should know Ossis (East Germans) well.

Besides the financial East-West gaps, the psychological gaps also lie between eastern residents and western citizens. From the viewpoint of West Germans, the Peaceful Revolution was a victory for democracy, and East Germans were victims of a dictatorship. However, how do East German feel about the viewpoint?

To answer this question, what the GDR was like is to be discussed at first. East Germany was a satellite of the Soviet Union. This country had the most successful economy among all members of the Communist Bloc, and even some internationally competitive sectors such as mechanical engineering and printing technology. Like many communist countries, there was no freedom of speech and expression, which resulted in many desperate emigrants. Besides, the GDR had a relatively homogenous (and xenophobic) society because fewer foreigners immigrated to East Germany than to West Germany. Such population dynamics (many emigrants with fewer immigrants) led to a workforce shortage, and so, a larger active participation of women in the workforce (as well as a more sufficient number of and quality of childcare facilities) was one of the notable characteristics and “legacies” of the GDR society. Nonetheless, the difference in economic strength between West and East Germany got larger and larger since the division of Germany, and finally the Peaceful Revolution occurred.

At the beginning of the Peaceful Revolution, in fact, most of GDR citizens called for mere freedom, and they had never thought of reunification with the other side of Germany. Then, after the reunification was conducted in the form of annexation of the GDR to West Germany, they were devastated by rapid changes. Political, educational, and social systems were converted to the western ones, and even Ampelmen, animated men on traffic signals for pedestrians, were replaced with western-style ones. The production of Trabant, an automobile symbolic of East German industry, was ceased in 1991. News about the injustice of SED (abbreviation in German of the Socialist Unity Party of Germany) was broadcast day after day. The Treuhandanstalt allowed western enterprises to beat down prices or take advantage of their financial and/or political dominance over eastern companies. (A report by Halle Institute for Economic Research mentioned, however, that this privatization agency has been criticized with its actual activities ignored and/or with its long-term effects insufficiently analyzed.) Unemployment rate surged, which suffered women most. Some Wessis (West Germans) came to the former GDR territories and tried to drive the eastern inhabitants out of their lands by force and to buy up the properties. The West Germans that first contacted East Germans after the reunification were likely to fall into certain categories: insurance agents who harassed eastern residents, industrialists who exploited the bargain sales during the privatization process, and so on. Because of this (or at least in part), the eastern residents have come to generalize every West German to be superficial, arrogant and money-oriented. Thus, Ossis, a lot of whom were between jobs, started to feel as if they, as losers, were now ruled by the West and became second-class citizens. They felt Ostalgie, a portmanteau of Ost (east) and Nostalgie (nostalgia), and missed their former homogenous, equalized society, although enjoying the improving standard of living also. A mental Berlin wall then emerged between the “lazy and complaining” Ossis and “arrogant and money-obsessed” Wessis.

What about the psychological wall between East and West Germans these days? Generally, many western residents seem to consider the eastern partners positively as hardworking, friendly and helpful although the easterners still think of their counterparts negatively, as arrogant. However, Wessis sometimes exhibit behavior discriminatory against Ossis. When a woman from the West decided to enter the university at Dresden, she was asked by her friend if she would like to attend a meeting of Pegida (a far-right political movement). In TV dramas, Ossis tend to be depicted as being simple and credulous, and transcriptions of the easterners’ dialect are superimposed on the screen. Job seekers who graduated from the universities in East Germany are sometimes presented lower salary than those who graduated from universities in the West. Besides, every time TV documentaries describes the horrors of the GDR and the SED dictatorship, many East Germans feel as if they themselves were criticized. With no regard for such easterners’ feelings, publications and annual reports issued by the federal government insist that the dictatorship of the SED/GDR should be critically appraised in a “no-tolerance” manner. Thus, the psychological Berlin Wall still remains everywhere.

Then, how can we narrow the psychological gap? One possible solution is that politicians, media, and the federal and state governments should not stress the injustice and/or horror of the GDR/SED too heavily and that they should evaluate the former GDR/SED in a fairer way. Of course, the SED/GDR should be criticized in many aspects including re-education for “inadequate” children and young adults. However, considering many ordinary easterners who look on the former GDR’s homogenous, equalized society favorably, the strictly critical attitude towards everything about the GDR/SED can be harmful to narrowing the psychological East-West gaps. Another possible solution is frequent contact with each other. Actually, a recent opinion poll conducted by a public broadcasting organization shows that one sixth of westerners have never been to the eastern territories. Thus, if there are more opportunities to know each other, the inner wall between Ossis and Wessis may become less significant. Fortunately, East Germany has a lot of popular trip destinations including Berlin and Mecklenburg-Western Pomerania. Take a trip to East Germany and talk to the local people over a beer or local cuisine!

theguardian.com/world/2015/oct/02/german-reunification-25-years-on-how-different-are-east-and-west-really theconversation.com/30-years-after-the-berlin-wall-came-down-east-and-west-germany-are-still-divided-126589 schott.blogs.nytimes.com/2009/10/15/ostalgie en.wikipedia.org/wiki/Ostalgie Annual Report of the Federal Government on the Status of German Unity 2018 (bmwi.de/Redaktion/EN/Publikationen/jahresbericht-zum-stand-der-deutschen-einheit-2018.pdf?__blob=publicationFile&v=3) iwh-halle.de/en/publications/detail/Publication/united-country-three-decades-after-the-wall-came-down-1 <in German> userpage.fu-berlin.de/melab/wordpress/?p=4814 (“Ossis and Wessis forever?” by Nele Templin and Antonia Grzelak) welt.de/gesundheit/psychologie/article147131006/So-sieht-es-in-der-Psyche-von-Ossi-und-Wessi-aus.html (“This is what the mind of Ossis and Wessis looks like.” by von Fanny Jiménez) <in Japanese> “The Wall - The reality 30 years after the collapse -“ (the second of the three feature stories; Asahi Shinbun published on November 12, 2019) young-germany.jp/2019/09/ostfrauen (“My DDR - Shedding light on women in East Germany: Uta Mitsching-Viertel” interviewed by Hideko Kawachi) young-germany.jp/2019/12/ddr7 (“My DDR - East Germans did achieve the Peaceful Revolution, but West Germans were the winners.” interviewed by Hideko Kawachi)

Agree
Disagree
Latest conversation
Kazuhisa HIRAOKA
Jan 2
Created

The German federal government should establish another more elaborate financial scheme.

To tackle the troublesome situation in the 1990s, the German federal government took advantage of the Solidarity Surcharge and Solidarity Pact I. Solidarity Surcharge is an additional fee on income tax, capital gains tax and corporate tax that contributes mainly towards the costs of reunification, and it was originally introduced for one year in 1991. (Of note, Germany has only general taxes and there is no specific earmarked tax.) Solidarity Pact I was an agreement among the representatives of the federal government, the parties, and the minister presidents of the German federal states in March 1993, and it took effect from 1995 to 2004. This agreement included the re-introduction of the Solidarity Surcharge and the revision of the Federal Financial Equalization System, through which financially stronger federal states give aid to weaker federal states. Under the successor Solidarity Pact II, which came into effect in 2005, the federal government undertook to provide the eastern states with special supplementary federal allocations (Basket I) and disproportionate funding from the federal budget (Basket II). Basket I was aimed at catching up with the GDR-derived behind such as the large infrastructure backlog and at compensating for the disproportionately low financial strength in the “new” federal states. Basket II was for the promotion of the East in the economy, innovation, R&D, and education, transport, housebuilding, and urban development with the aim to strengthen new federal states financially.

Then, 15 years had passed since Solidarity Pact II came into force. The financial scheme mainly through the Solidarity Surcharge and Solidarity Pact II has been working well, and many infrastructural, environmental, social, educational, sports and cultural projects have been carried out with the aim of the reconstruction of East Germany. However, there have been some problems about the scheme. Firstly, East Germany no longer exhibits a general deficit in physical capital basically, and more money raised as the Solidarity Surcharge has been spent on projects other than the Eastern development since 2012. Secondly, regarding the Federal Financial Equalization System, the same donor states tended to help the same receptor states, and some western states complained of the burden because they themselves are financially weak. Lastly, it has been pointed out that the “Solidarity” funds, which is originally paid by western workers as tax, had been falling into western contractors or proprietors in the end via a lot of reconstruction and development projects, such as infrastructure construction in the East. Because of these problems (or at least in part), Solidarity Pact II and the Federal Financial Equalization System were finally expired in the end of 2019. Moreover, German taxpayers, except for the top 10%, will be completely free of the Solidarity Surcharge in January 2021. Nonetheless, East-West gaps still exist. For example, infrastructure insufficiency is still widespread throughout East Germany considering broadband expansion and construction problems. Besides, a smaller industrial structure of the East, such as its lack of large firms and/or group headquarters, results in lower wages and productivity.

However, there are various ways to narrow the financial gaps. One report points out the possibility that the eastern urbanized areas including Halle/Saale, Central Thuringia (Weimar), and Southern Saxony (Chemnitz) have not fully utilized their economic potential. This report suggests the importance of industrial clustering in such eastern areas as well as construction of more efficient communication infrastructure in rural areas nationwide to enhance attractiveness and growth opportunities. (In fact, most of the eastern regions are categorized as rural.) Another report proposes boosting the growth of existing SMEs (small and medium-sized enterprises) to compensate for its lack of headquarters because bringing up SMEs to be large firms can increase productivity in the East. East Germany is traditionally weak at private R&D because of not only the former GDR’s nationalized policies but also its lack of large firms, while there are a number of competitive public research institutes and universities in the East which conduct studies in the fields of biotechnology, medical technology and health science as well as production technology, optical technology/photonics, electrical engineering, measurement technology. Close liaison and/or interdisciplinary cooperation between the SMEs and such research institutes can foster innovation and the SMEs. In terms of R&D, the eastern federal states have been suffering from serious shortage of skilled workers and academic professions because of brain drain with less immigration since the GDR era. The emigration tendency of the East, which has been relatively less severe recently, is one major reason why the East is aging faster than the West. To attract skilled foreigners and overseas professions, the federal government as well as the state governments should take measures to sweep away the xenophobic atmosphere in the new federal states. Before the collapse of the Berlin Wall, West Germany used to be a more xenophobic society than the former GDR, but the West could change. For the eastern states, now is the time to change.

Thus, the East-West gaps still exist, but a number of suggestions are provided to address the gaps. Designing an elaborate fiscal scheme to effectively use the money for really required projects is key to success in narrowing the East-West gaps.

dw.com/en/german-government-moves-to-end-solidarity-tax-for-eastern-germany/a-49983217 wwkn.de/en/about-german-taxes/solidarity-surcharge-solidaritaetszuschlag ghdi.ghi-dc.org/docpage.cfm?docpage_id=3450 iwh-halle.de/en/publications/detail/Publication/united-country-three-decades-after-the-wall-came-down-1 theguardian.com/world/2015/oct/02/german-reunification-25-years-on-how-different-are-east-and-west-really theconversation.com/how-divisions-between-east-and-west-germany-persist-30-years-after-reunification-126297 pewresearch.org/fact-tank/2019/10/18/how-the-attitudes-of-west-and-east-germans-compare-30-years-after-fall-of-berlin-wall econstor.eu/bitstream/10419/206658/1/1681382067.pdf allgemeinebauzeitung.de/abz/bauwirtschaft-im-osten-grosse-luecken-sind-noch-zu-schliessen-25059.html (in German)

Agree
Disagree
Latest conversation
Kazuhisa HIRAOKA
Jan 2
Created
Translate