“There were and are everywhere in the republic large differences in living standards,” Köhler said in an interview with Focus magazine. “If you want to level them out, you cement the subsidized state and place an intolerable burden of debt on the young generation,” said Köhler, who was in the past head of the International Monetary Fund (IMF). “We must get away from the subsidized state.”

Köhler’s statements and the results of the September 19 elections in the east German states of Brandenburg and Saxony highlight the economic and social contradictions posed for German imperialism by its effort to swallow and absorb the workers state in the east and reimpose capitalism in the former East Germany. This reality is more and more recognized by the big-business media and many capitalist politicians.

The September 16 Economist, for example, warned that “the worst thing that could happen to Germany would be if its two parts started fighting over scarce resources,” in an article titled “Getting back together is so hard: Fifteen years after the Wall came down, there are still two Germanies.” The London-based magazine continued: “Many of east Germany’s problems flowed from the political decision to go for quick unification in 1990…. Fledgling companies in the east had to put up with strong trade unions and high wages.”

Rather than ushering in a period of greater power for the German bourgeoisie, the reunification of the country has resulted in its relative weakening in relation to its rivals within capitalist Europe. Flat economic growth, skyrocketing government debt, and persistent high levels of unemployment have been the reality, not the “flourishing landscapes” promised by former chancellor Helmut Kohl at the time of reunification.

Taking advantage of the economic crisis in the east and opposition to the federal government’s Hartz IV plan, a broadside attack on unemployment benefits, the far right-wing National Democratic Party (NDP) gained 9.4 percent of the vote in Saxony—enough to get its first seats in any of Germany’s regional parliaments since 1968. The German People’s Party in Brandenburg, also a rightist party, gained 5.9 percent. The two right-wing parties had agreed not to challenge each other in the two states.

The party of the former Stalinist rulers of the German Democratic Republic (GDR), the Party of Democratic Socialism (PDS), was the biggest winner in the elections, receiving 28.9 percent of the vote in Brandenburg, the state that surrounds Berlin and is the largest in the east, and 23.4 percent in Saxony.

It is unusual for prominent capitalist politicians to call into question the German government’s “Solidarity Pact,” which promises to bring basic living conditions in what was previously East Germany up to the level of the rest of the country. But in June, a government commission pointed to this pact as a major factor in the floundering German economy. Since 1990 Berlin has spent $1.5 trillion in “transfers” to cover unemployment benefits, pensions, and other programs in order to head off social explosions in the economically devastated east.

Some ruling-class voices backed Köhler. The editors of the Berliner Zeitung made the point more sharply. “The so-called leveling of living conditions is part of the founding my ths of German unity—it is also its biggest lie,” they wrote in the week after the president’s remarks were aired, in an editorial titled “Köhler was right.”

Among bourgeois figures protesting Köhler’s remarks was the premier of the east German state of Brandenburg, Matthias Platzeck of the Social Democratic Party (SPD). “I cannot accept the fact that the range in employment can run 5 to 25 percent,” he told the newspaper Bild am Sonntag. Chancellor Gerhardt Schröder distanced himself from the president’s comments, stating, “Of course, it’s the federal government’s job to work each day to create an equal standard of living.”

The SPD got trounced in the elections in Saxony, receiving only 9.5 percent of the vote, its worst ever in any regional election. In Brandenburg its share of the vote fell by 7 percent to just above 32 percent. In both states, the opposition Conservative Democratic Union got the plurality of the votes cast and will have to form coalition governments with other parties, perhaps the SPD.  
 
Capitalists in Germany weakened
The Berlin Wall dividing Germany was torn down in November 1989 through the struggles of the people of East Germany against the Stalinist regime. The rulers in Washington and other imperialist centers boasted that the reunification of Germany would give stagnant capitalist economies in Europe a boost. But rather than launching capitalist growth in Germany and the rest of capitalist Europe, reunification has put a lid on it, and become a huge burden for the German rulers.

The past 15 years have proven that it is not possible to change the social relations that were shaped by the overturn of capitalist property relations throughout the region, including east Germany, by just pouring in money. Where once revolutionary force by workers and farmers overturned capitalist property relations, however much this revolutionary struggle was limited and bureaucratically restricted by the Stalinist misleaderships, counterrevolutionary force by the capitalists must be used to restore capitalist property relations.

German finance capital has come to resemble a dysfunctional boa constrictor: the west swallowed the east whole but found the indigestion worse than the meal. Moreover, the collapse of the Stalinist apparatuses in Eastern Europe and the Soviet Union opened up for the first time in half a century the possibility for collaboration between workers throughout the country.

The German rulers have been compelled to pour a net $1.5 trillion into eastern Germany since 1990 in an effort to spend their way out of a showdown with workers and farmers in the east. Three-quarters of these funds have gone to cover the costs of pensions, unemployment benefits, make-work projects, and other social programs as part of the Solidarity Pact. Only 25 percent of these funds have been spent on roads, railways, telecommunications, and other infrastructure.

Berlin has had to borrow massive sums to finance this spending. In 1990 government debt stood at $300 billion. By 1999 it had reached $900 billion. Today it is about $1.2 trillion—60 percent of gross domestic product, the maximum permitted in Eurozone countries. Economic growth for 2001-2003 averaged less than 1 percent per year.

Still believing in their “victory” in the Cold War and the dream of an expanding economy that would dominate Europe, the German rulers pushed the European Union to adopt the 1996 Growth and Stability Pact. The accord bounds governments to maintain annual deficits below 3 percent of gross domestic product and to keep their public debt under 60 percent of GDP.

The pact has become an embarrassment to Berlin, however, as the German rulers and their allies in Paris have failed for the last three years to keep their deficits below 3 percent. Only by virtue of their dominating position within the EU have they avoided paying the fines stipulated for the violation of the very rules they insisted on setting. Berlin is now pressing for a formal revamping of the rules because it anticipates further high public debt.

At the same time, Berlin and Paris are proposing cutting off billions of euros in funding for “EU regional development” for less developed countries in Central and Eastern Europe. They are also calling on governments there to raise business taxes, which they claim is luring investment to poorer countries away from Germany and France. The German finance minister complained earlier this year that with its payments for “regional development” Berlin is “sponsoring” the loss of jobs in Germany.

“When the people of Eastern and Central Europe joined the EU in May, they thought they were embarking on a project designed for the mutual European good,” said an article in the September 10 International Herald Tribune. “But they are discovering it is a competitive world even within the EU’s sheltering borders.”

Since the mid-1990s unemployment figures have remained higher than any time since the 1930s, with the greatest weight falling on the eastern part of Germany. In the east, 20 percent of the workforce is jobless, according to government figures, while more than 8 percent is out of work in the west.

Factory owners are taking advantage of workers’ uncertain job prospects to push through concession contracts with their unions. Siemens workers will now be working 40 hours per week instead of 35, with no increase in pay. DaimlerChrysler won $600 million in wage cuts after threatening to shut down operations at its Stuttgart plants.

The SPD-Green Party coalition government in Berlin has responded to Germany’s economic stagnation with a series of measures aimed at making workers and farmers pay for the crisis. Hartz IV, named after government advisor and Volkswagen executive Peter Hartz, will reduce both the amount of unemployment compensation workers receive and the length of time they will be eligible to receive it.

Protests against Hartz IV have been largest in the east. Weekly Monday marches over the last two months have drawn tens of thousands. Trade unions and the Stalinist PDS have been building the Monday actions, and right-wing parties “now play a prominent role” in the demonstrations against Hartz IV, reports the International Herald Tribune. The rightists’ success in using demagogy to paint themselves as the defender of the unemployed, of the “little man,” against the “elite” in Berlin was registered in their strong showing in the recent elections.  
 
 
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