Dictatorship and Demand Th

HARVARD HISTORICAL STUDIES • 147 Published under the auspices of the Department of History from the income of the Paul Revere Frothingham Bequest Robert Louis Stroock Fund Henry Warren Torrey Fund MARK LANDSMAN Dictatorship and Demand The Politics of Consumerism in East Germany HARVARD UNIVERSITY PRESS Cambridge, Massachusetts London, England 2005 Copyright © 2005 by the President and Fellows of Harvard College All rights reserved Printed in the United States of America Library of Congress Cataloging-in-Publication Data Landsman, Mark, 1966– Dictatorship and demand : the politics of consumerism in East Germany / Mark Landsman. p. cm.—(Harvard historical studies ; 147) Includes bibliographical references and index. ISBN 0-674-01698-X (alk. paper) 1. Consumption (Economics)—Germany (East). 2. Socialism—Germany (East). 3. Germany (East)—Economic conditions. 4. Germany (East)—Politics and government. I. Title. II. Series. HC290.795.C6L36 2005 2004054334 To Jenny Contents Acknowledgments ix Abbreviations xi Introduction 1 1 Production and Consumption: Establishing Priorities 16 2 The Contest Begins: The Currency Reform, the Berlin Blockade, and the Introduction of the HO 38 3 The Planned and the Unplanned: Consumer Supply and Provisioning Crisis 74 4 The Rise, Decline, and Afterlife of the New Course 115 5 Demand Research and the Relations between Trade and Industry 149 6 Crisis Revisited: The Main Economic Task and the Building of the Berlin Wall 173 Epilogue 208 Notes 223 Index 289 Acknowledgments In the course of writing this book, I have incurred many debts of gratitude. It is a great pleasure to acknowledge them here. To begin with— the money. I would like to thank Columbia University for a President’s Fellowship in 1996–97, which enabled me to get started on the research. Most of the research, however, was funded by the Social Sci- ence Research Council’s Berlin Program for Advanced German and European Studies in 1997–98. The Berlin Program was a unique ex- perience, offering a stimulating intellectual environment and oppor- tunities for making contacts at Berlin’s Freie Universität, the Zentrum für Zeithistorische Forschung in Potsdam, and the Berlin branch of the Munich Institut für Zeitgeschichte. For their scholarly rigor and comradery, I would like to thank my fellow Berlin fellows; for their indispensable administrative assistance, I am indebted to Ingeborg Mehser and Dagmar Klenke. I would also like to thank Professor Peter Steinbach for allowing me to present some of my early findings to his seminar on East Germany at the Freie Universität. Anyone who has done archival research knows how difficult the expe- rience can be. Without the help of patient archivists the task would be impossible. I am deeply grateful to the staffs of the Bundesarchiv in Lichterfelde, the Landesarchiv Berlin (Breite Straße), and the Bundes- archiv Außenstelle in Dahlwitz-Hoppegarten. While in Berlin, I also benefited from countless discussions with several scholars—German and American, professors and doctoral candidates. For their advice, suggestions, and criticisms, I would like to thank Richard Bessel, Dierk Hoff- mann, Patrice Poutrus, Judd Stitziel, Corey Ross, Paul Steege, and Peter x Acknowledgments Steinbach. I would especially like to thank Philipp Heldmann, who has generously shared his research and insights with me. Throughout the research and writing, his help has been extensive, his comments invaluable. Of course, the idea for the project took shape well before I ever got to Berlin, in the course of graduate work at Columbia University. When I re- turned from Berlin and began writing, I received indispensable criticism and encouragement from Fritz Stern, Volker Berghahn, Victoria De- Grazia, Richard Ericson, and Daniel Purdy. My time at Columbia, however, was most profoundly marked by my doctoral advisor, Fritz Stern. Repeated stints in his research seminar imparted a far deeper apprecia- tion of the pleasures and burdens of history than I might ever have imag- ined when I entered graduate school. I owe him an intellectual debt that can scarcely be repaid. After submitting my dissertation and while writing conference papers, drafting articles, and revising chapters, I continued to benefit from the helpful comments of several friends and colleagues: Volker Berghahn, Manfred Enssle, Martin Geyer, Maureen Healy, Philipp Heldmann, Dierk Hoffmann, Alexander Nützenadel, Jake Short, and Paul Steege. I would also like to thank Ken Barkin for permission to use here parts of an article I wrote that was published in Central European History. At Harvard University Press, I am indebted to Kathleen McDermott for taking the project on, to Kirsten Giebutowski for seeing it through to publication, and to Professor Patrice Higonnet for including it in the Harvard Historical Studies series. In equal measure, I am grateful to the two outside readers of the manuscript, who provided highly per- ceptive comments and suggestions for improving it. Finally, and most important, I have personal debts of gratitude. My parents, Faith and Mervyn Landsman, have shown exemplary patience and support during my years of graduate study and beyond. Anne and Warren Weisberg have offered additional and much-appreciated sym- pathy and encouragement. Last, I owe inexpressible thanks to my wife, Jennifer Weisberg, who, reading every page with an unerring eye for the infelicitious, has helped me to identify and remove several cognitive, technical, and stylistic blemishes. Without her patience, wit, and irony, the work would be immeasurably poorer. At every stage of the process, her emotional and intellectual support has been way above and beyond the call of spousal duty. I dedicate the book to her. As convention dictates, I acknowledge sole responsibility for all er- rors of fact, form, and style. Abbreviations CARE Cooperative for American Remittances to Europe CDU(D) Christian-Democratic Union of Germany COMECON Council for Mutual Economic Assistance (CMEA) CPSU Communist Party of the Soviet Union DFD Democratic Women’s Federation of Germany DHZ German Trade Center DVHV German Administration for Trade and Provisioning DWK German Economic Commission EDC European Defense Community ERP European Recovery Program (Marshall Plan) FDGB Free German Federation of Unions FDJ Free German Youth FRG Federal Republic of Germany (West Germany) GARIOA Government Aid and Relief in Occupied Areas GDR German Democratic Republic (East Germany) GHK Wholesale Branch HO Handelsorganisation (Trade Organization) HVHV Central Administration for Trade and Provisioning KKB Coordination and Control Agency for Domestic Trade KPD Communist Party of Germany KVP People’s Police in Barracks LDP(D) Liberal-Democratic Party of Germany LPG Agricultural Production Cooperative SAG Soviet Stock Company xii Abbreviations SBZ Soviet Occupation Zone SCC Soviet Control Commission SED Socialist Unity Party of Germany SKHV State Commission for Trade and Provisioning SMAD Soviet Military Administration in Germany SPD Social Democratic Party of Germany SPK State Planning Commission VdgB Association for Farmers’ Mutual Help VdK Association of Consumer Cooperatives VEB People’s-owned Enterprise DICTATORSHIP AND DEMAND Introduction Erst kommt das Fressen, dann kommt die Moral. Bertolt Brecht, Die Dreigroschenoper In October 1999, as a way of marking the fiftieth anniversary of the founding of the German Democratic Republic, Berliners watched as more than forty Italian confectioners from Perugia built a chocolate facsimile of the Berlin Wall. The final product of their artful labors was a free-standing structure, thirty-nine feet long, consisting of four hun- dred blocks of chocolate, each weighing forty-five pounds—in total, thirteen tons of Italian chocolate. As an item in the New York Times blithely remarked, “Some eastern Germans have reacted to the anniversary with warm recollections of life before unification; others find nostalgia for a police state distasteful.”1 Could Berliners have been treated to a more ambiguous symbol than a wall of chocolate? No doubt intended as a happy monument to reunification, to all the material pleasures so long denied East Ger- mans by the actual Berlin Wall, the chocolate version offered the rather perverse spectacle of the Cold War’s most despised symbol and instrument of tyranny cast in flavors of enticing sweetness. The incon- gruity of the monument was only heightened by the fact that it was also misleading: on the day being commemorated—October 7, 1949— there was no Berlin Wall. Not until August 1961 did the East German state physically seal itself off from West Berlin by erecting its self- described “antifascist protection wall.” Perhaps worse still, the chocolate replica could so easily be interpreted as a symbol of remaining divisions: divisions between “eastern” and “western” Germans, the much-discussed “wall in the head” (Mauer im Kopf); and divisions between former East Germans themselves, between those whose memo- ries of the German Democratic Republic flicker in the warm afterglow 1 2 Introduction of nostalgia and those who prefer the taste of chocolate to that of a “police state.” One can hardly blame the Italians. How could they have known that the new Germany would be no more immune to anxieties about the soundness of national unity than past Germanys have been? Yet to pause for reflection on the history of Germany since World War II is to recognize that issues of material well-being and consumerism form the theme of yet another chapter in the centuries-long story of Germany and its inner divisions. This book is an investigation into that theme. It explores the political consequences of frustrated desire in the German Democratic Republic (GDR) during the years between the Berlin Blockade and the building of the Berlin Wall. The immediate setting is thus East Germany; the broader context is defined by the Cold War, the division of Europe, and the rise of dis- tinct, new social orders on either side of the “Iron Curtain.” The central tension driving the story arose from the confluence of an emerging, mass consumer society in the West and the crucial, destabi- lizing role of consumer dissatisfaction in the East.

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