The East German state circus, traditionally one of the most revered in the world, has been closed down. What animals can be sold will be; the rest are to be killed. The market has come to town and the unprofitable circus must go. Into the fertile area of East German magazine sales has come the West German and American porn industry. There are profits there, you see. Ah, the sickly smell of free-market "liberation’’.
If you read the British press it all seems so simple. East German Communism has been swept away. The free marketeers have come from the West to make life good. Germany is to be unified. The Germans are to be the most prosperous of Europeans. Hurrah for capitalism! The reality is different. There never was communism in East Germany, but state capitalism, ruled over by a class of party bosses who ran East German exploitation for their own ends.
State capitalism, not socialism of any description. has failed utterly and now East Germany is to be integrated into the rest of the private-capitalist world. Germany is being unified, but it is still divided between those who own its resources—the capitalists—and those who produce its wealth—the workers. These two classes, whose interests are diametrically opposed to one another, can never be united, except in terms of a national illusion. As for prosperity coming to Germany, there are plenty of workers who will tell a different tale—particularly the more that they are exposed to the harshness of the unregulated market.
Massive unemployment
East German workers face massive unemployment. In the past their jobs, which were often state-subsidised in order to maintain the appearance of full employment, produced goods for the East German national market. Now that market is being saturated by West German capitalist outfits which can sell higher quality commodities than East Germany is able to make. Of the 8000 East German firms, which are due to be privatised in October, the vast majority cannot compete on the open market with their West German rivals. In particular, food, textiles and mechanical engineering firms are going bust.
According to Creditreform, a West German credit-rating company which is now active in the East, there will be two million workers unemployed in East Germany after the October privatisation. The "good news" is that new jobs—just under a million—will emerge by the end of 1991 in new services, notably financial institutions and hotels (Rheinischer Merkur, 15 June). Even if this promised light at the end of the dark tunnel of unemployment proves to be a correct prediction, who wants to move from producing useful wealth to taking jobs counting money in banks or insurance houses, or waiting on tourists? Is that what liberation means? And it should be noted that even if the most optimistic forecasts come true, there will still be over a million unemployed East Germans by the end of next year.
East German workers with jobs are discovering something else: that they are expected to pay West German prices for goods and services, but the capitalists investing in East Germany are only willing to pay old East German wages. So. we see the disgusting contradiction of East German stores with shelves full of hitherto unobtainable commodities, but all that the East German wage slaves can afford to do is look at them longingly.
They were fed the lie that once the Berlin Wall came down they would enjoy access to all the goodies which they had spent years seeing advertised on West German television. Well, the Wall is down, but poverty persists. Is it any wonder that the German press has reported a major increase in petty crime in East Germany? The capitalist explanation is that the East German workers have yet to understand the ethos of private property relations and are recovering from years of state-capitalist frustration. The fact is that they are angry, particularly the young East Germans who were promised a market which would liberate them; they have been offered unemployment or low wages, and commodities which they are too poor to buy. Such is capitalist "freedom".
Struggle against new bosses
Workers who were out in the streets last year to bring down the Honecker dictatorship are now having to struggle against their new bosses. Workers in the East German shoe and leather industry have called nationwide token strikes to draw attention to their plight. More than half a million jobs are at stake in that industry and all that "liberation" offers them is a future job in a hotel or a bank.
The striking workers will be defeated. The hypocritical German capitalists, who showed such theatrical concern for their struggle when it was fought against the old state-capitalist elite, could not care less what becomes of the workers now that they have their grubby hands on the united German shoe industry. At the end of last year the German press was celebrating the struggle for freedom being waged by the newly-formed Free Federation of German Trades Unions, an umbrella organisation of East German non-state unions. The same union called for an increase in net pay of 50 percent as from 1 July this year. The same newspapers who were cheering them on less than a year ago are now denouncing their "impertinent" demands.
The East German workers were right to overthrow the anti-democratic state- capitalist dictatorship of the Communist Party. They were more than right: they were heroic in taking on a force which we now know was planning to put down the rebel workers in the same way as the Chinese dictators did at Tiananmen Square. But the victory of last winter was a battle won. not a war ended. The East German workers had better realise that the owners of the Earth, be they private or state capitalists, Eastern or Western, will oppress and exploit them until they are dispossessed of their ownership and control of the means of wealth production and distribution. The class war goes on. Experience will teach this to the East German workers—as it did to the many Polish workers who recently organised a massive rail strike against their new oppressors in the Solidarity government—but a period of temporary enchantment with the wonders of the illusory free market is bound to occur.
Housing crisis
East German wage slaves who have voted to be led by Kohl and his team of market-lovers. and the other workers conned by the reformist promise of welfare capitalism offered by the SPD, need only peep over the border to Hamburg where their fellow workers, long-standing members of a "free" capitalist nation, face a major housing crisis.
The Hamburg Abendblat (27 April) reports that rents in Hamburg have increased from early 1989 to early 1990 by an average of 33 percent. This figure is second only to Stuttgart where the rent per square metre has gone up 39 percent in the past year. The German housing problem has led to widespread opposition to the granting of housing to East German workers wanting to settle in the more prosperous Western sector. So. after years of waiting for the Wall to come down. East German workers are now being told not to compete with their Western counterparts for cheap or subsidised housing. The new Wall is made of poverty and fear.
The Guardian (27 July) referred to the West German housing crisis as “a political battlefield . . . a social scandal in a land of conspicuous prosperity: the squeezing out of the housing market of tens—perhaps hundreds—of thousands of citizens". The West German Housing Minister. Gerda Hasselfedt, estimates that one in four East German homes are “uninhabitable" and three in four “need to be totally renovated". If new homes are not to be built, and old ones improved, by the state, then who will take on the task?
Private property developers and landlords certainly have no interest to gain in building houses and doing up old ones for the benefit of poor people. On the contrary, with an excess of supply over demand their economic interest is to push up the rents and interest rates on mortgages. As ever, the housing problem is not about an inability to produce houses—last year there was a 14.7 percent increase in German house-building, mainly at the more expensive end of the market. It is about the inability of workers who need homes to pay for them at prices that will bring profits to capitalists.
The housing crisis has also given rise to a wave of anti-immigrant feeling amongst the least enlightened workers. Where Turkish “guest workers" were once tolerated, German racists are saying that that it is bad enough having to compete with other Germans without having to put up with "foreigners". In the riotous celebrations following the German football victory in the World Cup:
East Berlin and Hamburg . . . witnessed bloody battles between police and young right-wing extremists, as well as attacks on Vietnamese, Turks and other foreigners . . . In Cologne a group set on a young Turkish taxi driver trapped in the delirious crowd, trying to overturn his car and lynch him. Police again used tear gas and batons to help him escape . . . (Guardian, 10 July).
The government has responded to this rise in racist insecurity by passing an Aliens Law which is designed to frighten away non-German workers wanting to settle there.
Germany is set to be the new European superpower. If you have millions of Deutschmarks invested in the Bundesbank you may be in for some sharp rises in profits. But most readers of this journal do not. Neither do the West German workers struggling to pay high rents. The hundreds of thousands of East Germans who are being thrown on the scrap heap of the unemployed do not. Nor do those who will have to face cuts in German welfare services which will have to be made so that taxes can be kept down so that German capitalists have money to invest in the East. In East Germany the circus is closing down and the lions are being given a fatal jab; for the wage slaves of Germany the future offers little in the way of either bread or circuses.
Steve Coleman
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