Abstract
The year 1966 marked a distinct turning point in the political economy of West Germany. It is possible to overdo talk of ‘watershed’, but clearly the recession of 1966 / 67 represented more than an economic hiccough. Up to 1966 state institutions had been showing signs of nerves and irritation at the political failures of others, but in general their concern was about the inflationary dangers of overstretched state budgets. Thus they sailed mostly unawares into the winter of 1966 / 67 and the unexpected calamity of no growth and 800 000 job losses. As recessions go, it was a relatively mild affair, but against the background of 18 years of uninterrupted growth, it was a considerable shock, particularly to the credibility of the state, whose legitimacy was founded on the expectation of economic stability and constant growth. Not surprisingly therefore it coincided with the end of the ‘Erhard-Era’, the formation of a ‘grand’ coalition between Christian and Social Democrats and the brief experiment with Keynesian demand management under Karl Schiller.
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Notes
C. f. P. Czada, Wirtschaft. Aktuelle Probleme des Wachstums und der Konjunktur (Berlin, 1980) p. 227.
W. Glastetter, Die wirtschaftliche Entwicklung der Bundesrepublik im Zeitraum 1950 bis 1975 (Berlin, 1977) p. 4.
E. Mandel, Die deutsche Wirtschaftskrise (Frankfurt/M., 1969) p. 14.
H. D. Hardes, Einkommenspolitik in der BRD: Stabilität und Gruppeninteressen; der Fall Konzertiete Aktion (Munich, 1974).
Karl Schiller, Reden zur Wirtschaftspolitik, vol. I (Bonn, 1968) pp. 34f, cf. also Hanns-Martin Schleyer (BDA/BDI), quoted in the FR, 1 June 67.
K. Schiller, ‘Stetiges Wachstum als ökonomische und politische Aufgabe’, in Der Okonom und die Gesellschaft (Stuttgart, 1964) pp. 226f.
K. Schiller, ‘Konjunkturpolitik auf dem Wege zu einer Affluent Society’ in Jahre der Wende, Festgabe für Alex Möller (Karlsruhe, 1968) p. 71.
See J. Krack and K. Neumann, Konjunktur, Krise, Wirtschaftspolitik (Frankfurt, 1978) p. 194.
Cf. Helmut Müller, Die Zentralbank — eine Nebenregierung (Opladen, 1974);
also F. Dörge, ‘Macht ohne Mandat? Die Bundesbank — eine Nebenregierung’ in Die Zeit, 31 Oct. 1969.
This is the polemical claim of K. Biedenkopf and M. Miegel, Die programmierte Krise (Bonn, 1979) p. 35.
Thus D. Dickertmann, ‘Die Autonomie der Bundesbank unter dem Einfluß geldpolitischer Entwicklungen’, in: Wirtschafspolitische Chronik, vol. I (1975,) p. 32.
W. Eucken, Grundsätze der Wirtschaftspolitik (Tübingen, 1955) p. 256 and O. Issing, ‘Währungspolitik im Spannungsfeld wirtschaftspolitischer Konflikte’ in E. Tuchfeldt (ed.), Soziale Marktwirtschaft, op. cit., p. 204.
Claudia von Braunmühl, ‘Ist die “Ostpolitik” Ostpolitik?’ in Jahn/ Rittberger (eds), Die Ostpolitik der BRD (Cologne, 1976) p. 165; also K. P. Tudyka, ‘Gesellschaftliche Interessen und auswärtige Beziehungen — Das Röhrenembargo’, in Varain (ed.), Interessenverbände in Deutschland.
See Wolfgang Hoffmann, ‘Keine Freiheit für das Wissen’ in Die Zeit, 10 Aug. 1984.
See H. Elsenhans’, ‘Lohnerhöhungen: Wachstumschance für den Kapitalismus’ in Forum — Zeitschrift für Theorie und Praxis des demokratischen Sozialismus, no. 2 (1976) pp. 78–133.
Cf. Miller/Mackie, ‘The Electoral Cycle and the Asymmetry of Government and Opposition Popularity’ in Political Studies, vol. XXI (1973) and K. G. Zinn, Der Niedergang des Profits, op. cit., p. 156.
The singling out of trade-union power as the primary cause of economic instability (inflation and recession) which is external to the market economic order has been the subject of considerable criticism, not the least because it denies the labour market the same ‘freedom’ as other commodity markets, where values fluctuate according to supply constraints (scarcity, abundance, quality, etc.). Manske thus describes the SVR’s analysis as ‘contravening market principles’, (ibid., p. 292). The increasing skill, productivity, but also scarcity of labour in the 1960s can be seen as quite natural factors contributing to the rise in the price of labour, just as the widespread introduction of a system of migrant labour in the same period can be seen as a deliberate political (market-external) measure to resist the market power of labour. There are a large number of critiques of the work of the SVR, of which the following are more noteworthy: R. Hickel/Mattfeldt (ed.), Millionen Arbeitslose — Streitschrift gegen den Rat der fünf Weisen (Reinbek, 1983);
Hickel/Mattfeldt, ‘Die “Fünf Weisen” in der Krise, 20 Jahre Rat der Ratlosen’ in GM, Nov. 1983, pp. 699ff;
H. Baisch, ‘Kritik an der Sachverständigenkonzeption’ in Markmann/Simmert (ed.), Krise der Wirtschaftspolitik (Cologne, 1978) pp. 57ff;
Ch. Roberts, Konjunkturprognosen und Wirtschaftspolitik (Cologne, 1981).
Thus Reinhard Kohler, ‘Die Bremspolitik der Bundesbank hat noch nie richtig funktioniert’ in FR, 27 June 1979, p. 13; Kohler was assistant to the later Bundesbank director Claus Köhler from 1972 to 1974.
Milton Friedman, ‘The Case for Flexible Exchange Rates’ in Essays in Positive Economics (Chicago, 1953) pp. 157ff.
Thus W. Hankel, ‘Shylock gesucht: Hockzinspolitik und internationale Kreditmärkte’ in Blätter für deutsche und internationale Politik (May 1982).
See Viktor Schoofs, Flexible Wechselkurse und Zentralbankpolitik (Göttingen, 1983) pp. 28ff.
See H. Ehrenberg ‘Ist vergessen, daß Konjunktur nicht ohne Nachfrage auskommt?’ in FR, 19 Nov. 1984, and statistics cited in FR, 26 Jan. 1984.
Thus H. J. Krupp (DIW), ‘Staatsverschuldung — noch kein Grund zur Sorge’, reprinted in abridged form in FR, 4 June 1980; ‘Crowding-out effects can be completely desirable from the point of view of growth policy…. If one wishes to liberate resources for absolutely necessary infrastructural investments, certain crowding-out effects are necessary, in order to avoid inflationary state indebtedness.’
See Gerhard Mensch, Das technologische Patt. Innovationen überwinden die Depression (Frankfurt/M., 1978);
Cesare Marchetti, ‘Swings, Cycles and the Global Economy’ in New Scientist, 2 May 1985. Karl-Georg Zinn remarks that the ‘innovation-wave-theory’ ignores that the ‘quality of these innovation spurts changes’, Niedergang des Profits, op. cit., p. 152.
H. J. Krupp, ‘Nullwachstum’, FR, 6 Jan. 1981.
See Martin Jänicke, ‘Umweltpolitik in Osteuropa’ in apuzg, B23 (1977).
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© 1988 Jeremy Leaman
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Leaman, J. (1988). State and Crisis Management, 1966–85. In: The Political Economy of West Germany, 1945–85. Palgrave Macmillan, London. https://doi.org/10.1007/978-1-349-19040-9_5
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