Sunday, 29 June 2014

The effect of Germany's political system on its economy - A case study

From the time of Renaissance, when humans started dominating, constitutions started being created and hence political, economic systems also. From that time, the whole world is following only three ideologies, which are Socialism, Communism and most commonly Capitalism. Each type of economic system has its own view on how the society should function. Firstly, Capitalism which is followed by a majority of countries in the world says people have their own property and can do whatever they want with it, whereas, in socialism the ideologies are opposite of that of Capitalism. Here, in Socialism, the profit is not only taken by the owner but is divided amongst a community. Some people say that Capitalism is fair while others think otherwise. Communism has a similar ideology to that of Socialism except that Socialism has an unemployment benefit while Communism is not in favour of it. Also, in Socialism, government does not play an important role while in Communism almost nothing is done without the intervention of the governing body.

Each country in the world has developed in its own way. While most finally settled on Capitalism, there are still a small portion of countries following Socialism and only 5 countries (Cuba, Laos, Vietnam, China and North Korea) following Communism. One such country that went through a lot of problems is Germany. It followed the “so called Socialism” during the rule of Hitler but changed over time to Capitalism. There are many countries that had Socialism earlier and opted Capitalism later. These countries still retain some ideologies of Socialism which they find beneficial to themselves (such as healthcare systems). There would be very less countries in this world that follow only one economic system purely.

To know about Germany’s economic system really well, first we need to know a bit about Germany’s history. Germany is a European country that has faced both the World Wars in the past. Both the Wars had caused a lot of devastation to the country. The main influences to the country’s governance were before the Second World War and these influences were led by Adolf Hitler. He is very well known for leading the Second World War’s German side but what is not known to many is that he had brought down German government (Weimar Republic - Socialist) and led it with his own NAZI party (also Socialist). Although both Weimar Republic and Nazism had the same socialist ideologies, some Germans did not like Weimar Republican rule. One such person was Adolf Hitler. With his speeches, he won the German people’s support and in 1933 became the Chancellor of Germany.

Germany has had several economical influences during its past under different types of rules and finally has a stable economical system. It follows a federal political system and is a country that could call itself Capitalist while still following some ideologies of Socialism (a few). It is one of the only countries in Europe that follows more of Capitalism.

But, it has not always been like this. Germany’s political and economic system has evolved over the decades from before the First World War till after the Second World War under the rule of Adolf Hitler and influences of other countries.

Well, the NAZI party had always dominated in Germany between the First World War and the Second World War due to the great influential speeches of their leader Adolf Hitler. He claimed that their party was a socialist party (National German Socialist Worker’s Party) but people argue against this statement whether it was really a socialist country or not.

Hitler was against the ideas of Communism and Capitalism but could still stand Capitalism as long as the businesses were not by Jews. The term that Hitler used was ‘National Socialism’ which meant he wanted only Germans in the country’s society/community. Although he could stand Capitalism, he was completely against the idea of Communism. Hitler feared what happened in Russia would happen in an already doomed Germany. Communism was against the middle class, against private property and was almost completely opposite of Hitler’s ideology.

As an argument, we could say that Hitler’s NAZI party was not completely socialist as they claimed. Hitler followed what was happening in Italy. He followed the footsteps of Mussolini (Italian dictator). What was followed in Italy was fascism where it was a society similar to socialism except for Socialist government was governed by low/middle class while Fascist government was governed by the upper class.

We could argue that Hitler did not mainly focus on reviving the German economy but he wanted to conquer other countries due to the ill-treatment of their country after the First World War. Fascism is a government that supports this type of rule where the main focus is either nationalism, racism or both. Although Hitler had both ideologies, he still gave an opportunity to the middle class to have their own businesses which is an attribute of Socialism and Capitalism. By now, we can see that the NAZI had a confused economic and political system and although they claimed Socialism, they mainly followed Fascism. This confusion can also be noticed from two statements that Hitler had given in the past. Firstly he said,
“Our adopted term ‘Socialist’ has nothing to do with Marxist Socialism. Marxism is anti-property; true Socialism is not.”

Also he made another statement that shows us that Hitler didn’t oppose Capitalism as much as he opposed Communism,
“I absolutely insist on protecting private property … we must encourage private initiative.”

This was how Germany’s economic status was in the past. But, what has changed the country’s economic system – this is my research. Well, from the clear fact above that Germany had a confused economic system that they followed; we could say that it is an unknown fact to many that Germany didn’t just follow Socialism but they followed a combination of economic systems. Germany’s current economic status now is quite stable but to compare any changes in the system, we would have to know what Germany’s current law says.

The laws present today in Germany were created by former Western Germany when Germany had split up. Eastern Germany was of communist ideology and tried building new communist laws over the already existing National Socialism whereas, Western Germany had enough of Socialism and Communism and emerged with its own constitution. The new law was created such that the good points of NAZI Germany remained and the other criminal aspects were reversed. This is how new type of economic system emerged in Germany (or more precisely a part of Germany). West Germans after the war considered communist and terrorist as the same. They thought so because they felt endangered to be in a strict (freedom less, democracy less) place. They could compare it only with terrorists because that is how terrorists behave!

Well, when revolt for the fall of Soviet Union started, even East Germans felt an urge for revolt and they started a revolt! The citizens wanted a unified Germany under the law of Western Germany. They called out “Wir bleiben hier, Wir wollen raus” (“We are staying here! We want out”). They had enough of Communism and the “Hitler, NAZI ideologies” and hence finally in late 1989 (on 9th November 1989), the demolishing of the Berlin wall began.


After this time, Germany followed laws similar to West Germany and finally opted for Capitalism after decades of rule under Socialism and Communism.  I wouldn’t be one-sided but capitalism has more benefits to the society’s economy than socialism and communism and it also provides people opportunities to show up their talent. That is what Hitler wanted but he chose the wrong way. The right way was to opt for Capitalism which he refused to. The results are now very clear. But, finally, German’s economy is stable following a Capitalist economy model…

-Suhas
8/3/14

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