By Peter Thompson GERMAN reunification was always going to be difficult.
In 1990, as Germany was going through its cuphoric stage of unification, Socialist Outlook wrote:
*To imagine that unification will be a simple and smooth matter of incorporation, privatisation and marketisation resulting in one big happy capitalist German family is to fail to understand the nature of the crisis of the western oconomies. Such a view also fails to grasp the whole project of "recapitalisation' and the resistance which will inevitably come from the majority of the working class in Less than two years later the ex-GDR has just boen through a massive two-weck strike organised by IG-Metall, the largest union in europe attempane to prevent employers reneging on a love accent to cuase cast and west German wages by 1995.
The sinke was almost one hundred per cent solid after balof 85 and 97 per cent.
Despite the fact that on the surface it appears to have been a trade dispute berween employers and workers in the engineering and steel sector, politically it represents a new mood of defiance and dissatisfaction in a working class which many on the left had written off because of it enthusiasm for German Equally encouraging is the fact that many thousands or workers in west Germany came out in solidarity with those in the cast. This was a rebuff was the bosses' strategy of trying to create divisions between workers in the east and west.
The strike then represents not only the first major struggle of workers in the cast, but the first example of all-German working class unity since the 1930s.
the strike has now ended with around 75 per cent accepting the compromise deal worked out by union leaders and employers. This gives an immediste 9 per cent wage nse and means the employers have until 1996 to equalise wages; but in retur the union has agreed to accept higher redundancies in order to stabilise or even lower vidual firms.
All in all this deal represents a partial victory, but is a very worrying development for the east German working class. They have indeed won a very substantial concession after a solid strike; yet many have accepted the deal only grudgingly. The employers have broken unear promises ocrore and taic is nothing to stop them doing it again.
Increased redundancies rep resent the thin edge of a wodge which could be driven further and further into working class unity given the high levels of unemployment in the ex-GDR.
In 1990 Helmut Kohl won the support of East Germans by promising that unification would mean that no one would be worse off and most would be better off.
The political decision to go for a lil exchange rate of cast German for west German marks was prompted by the need to win the December 1990 election and not by any sane coonomic decision.
The result of that decision was twofold: first the aggregate level of demand in the Cictman economy was massively and artificially inflated overnight. Most of the 200 billion marks which east German workers had in savings was spent on wester consumer goods in an intense but short oconomic mini-boom Home produced goods. though often better quality. were rejected in favour of the brightly packaged western goods.
This means that more and more cast German factories were closed, not because of some inherent inefficiency but because of political decisions taken in the west.
The introduction of the west German mark had a further cfin that the make exporl market for east German goods European countries. The coun tries could now no longer afford to buy good denominated in expensive German marks. The result: further bankruptcies.
The nett result was that the 1991/2 mini-boom rapidly went into reverse, especially in the cast. The real total of the unemployed and those on short-time Kohl Architect of fiasco: German Chancellor Kohl working in cast Germany is now around 4 million out of a workforce of 10 million. To this must be added the 2 million already out of work in West Germany at the time of reunification, a figure which is rising rapidly.
Paying for all this has massively increased the German state budget. The national debt İs estimated to be rising by about 200 billion Deutshmarks (DM) a year, and is expected to reach nearly 2 trillion DM by 1995. putting it well beyond the 60 percent of GDP limit for the EC Commission's requirements for coonomic union.
Most of this money is not going on productive investment but on servicing debe, financing unemployment and arms expenditure. The payment of interest alone on the state debt is already 40 billion DM per year and is expected to rise to 60 billion by 1995 contributing to a budget deficit in 1992 of 3.7 per cent per cent this year; well outside the 3 per cent limit agreed at
Collapsing public services and dwindling job opportunities add to the misery SOCIALIST OUTLOOK No. 43 May 29 1993. Page 11