Like all state-socialist regimes, the German Democratic Republic (GDR) had trouble organizing the production of consumer goods. Unlike the other Soviet-bloc states, however, the GDR was at the front line of the Cold War, and its citizens were able to compare East to West directly, usually to the detriment of the East. The leaders of East Germany's Socialist Unity Party (SED) were well aware that they faced a challenge. After all, before the Berlin Wall was built, hundreds of thousands had fled from East Germany, in part because of the higher standard of living in the West. Mark Landsman's new book examines the East German regime's attempts to respond to the demand for consumer goods from 1947 to 1961 through pricing policy, rationing, central planning, analysis of consumer needs, exhortation of workers to produce more, and, finally, the Berlin Wall itself.
Landsman shows that in the desperate years following World War II, consumer goods in eastern Germany, including food, clothing, and housing, were scarce. Moscow's policy of removing industrial plants and extracting high reparations from the Soviet occupation zone in Germany exacerbated the situation. The first elements of economic planning developed in response to chaos and shortage. Attempts to increase worker productivity by piecework pay, moral suasion, or special rations failed to produce the desired result. Before long, more money was chasing fewer goods, and price-setting and more stringent rationing were the necessary responses. Although consumer goods were scarce in the east well into the 1950s, shop windows in the western zones of Germany were filled with goods after 1947. East German leaders offered some goods at special stores (Handelsorganisationen or HOs) at high prices to soak up extra purchasing power, while still trying to provide basic goods at low prices. But Landsman demonstrates that shortages remained, and the crisis continued. The systemic failure to provide goods and the regime's heavy-handed attempts to increase labor output finally led to the workers' uprising in June 1953. Following that debacle, the regime attempted to shift investment funds to consumer items. Landsman documents the creation of new research units seeking to determine the objective needs of consumers (Bedarfforschung) rather than rely on subjective, individualistic demand (Nachfrage). But when decisions on how to allocate scarce resources were made, the SED tended to favor big industrial projects and guns over consumer goods. A new crisis of production after 1958, precipitated by the East German regime's decisions to push ahead with agricultural collectivization and a military buildup that took funds away from other investment, led to a flood of émigrés to the West—and eventually to the Berlin Wall.
Landsman successfully links the GDR's weak legitimacy with the "political consequences of frustrated desire" (p. 2). The book would have gained, however, from a clarification of the causes of this failure to respond to consumer demand. On the one hand, Landsman seems to argue that the cultural ideals of Communism kept [End Page 147] policymakers from responding to demand. Cultural images of the active, sacrificing, productive, male worker, part of the "proletarian mystique" of the Soviet model, drove policy, he says (p. 5). On the other hand, he paints a regime overwhelmed by both the circumstances of scarcity in the postwar era and the deficiencies of centralized planning. In this depiction, calls for republican austerity may have been intended to put a good face on a bad situation. Landsman ends by arguing that the Erich Honecker's regime drove the country into economic collapse by expending money on consumer goods rather than productive investment. If so, then the problem seems to be one primarily of economic necessity, not cultural ideals.
Landsman may also at times underestimate the ideological apparatus of Marxist Leninist economics. In 1958, as Landsman notes, Walter Ulbricht made the absurd suggestion that within a few short years production in the GDR would "overtake and surpass" that of West Germany, a statement echoing Nikita Khrushchev's prediction about the Soviet Union's ability to overtake...