Economic Miracle

Taking all the energies and resourcefulness that had made them a great power before, both Germanys set about to regain their place among the world’s major nations. Guided by the prudent, growth-oriented policies of Adenauer´s Economics Minister Ludwig Erhard and stabilized by the mutually beneficial “social pact” between unions and management, the West German economy took off. By the 1970s, West Germany, with a population of only 60 million, had become the world’s third largest economy and led the world in exports many times over the next few decades.

More importantly, the economic, foreign, and strategic policies of the Federal Republic rooted Germany firmly in the West for the first time in its history as the larger part of Germany was now developing as a crucial partner in the Western alliance, whose values and goals it largely shared. While West Germany was playing its leading role among western nations, East Germany (better known as the DDR) had become the most productive nation in the Communist East Bloc. (Although subsequent events have shown that much of this production was outmoded, second-rate and cosmetic.)

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