The Economic and Political Impact of The Reunified Germany

Chase Harris
Email: charris@monmouthcollege.edu
Phone (cell): 815.685.2135

Abstract

Twenty-three years after the reunification of the East and West Germany in 1989 there continues to be a division between the two parts of the Federal Republic of Germany. In this research project I examine the reasons for the continued economic, social and political divisions between East and West Germany.  The two nations were under very different economic and political systems and transitioning back to one nation did not come smoothly.  The transition was specifically tough on the East Germans because their system was perceived as failed and thus reunification meant becoming more like the West. Even living under the reunified country the East and West remained segregated due to economic and social constraints, such as high unemployment rates in East, wage differences, and different political views.  The difficult transition had many East Germans feeling nostalgic about their past and even longing for some familiarity, which further added to the social segregation.  The disparities between the East and West have begun to disappear into the social constructs of the reunified nation, but it is still not the “One Germany” that the leaders had envisioned.        

	Since the end of World War II the German Democratic Republic (GDR) and the Federal Republic of Germany (FRG) were separated not only by the Berlin wall but also by separate ideologies.  The East German GDR was under supervision of the USSR and, by nature, a socialist government.  The West German FRG was under the supervision of the three western powers, the United States, the United Kingdom, and France.  This rule influenced a democratic government to form in the west.  The two conflicting governmental ideologies provided just one of many barriers that needed to be hurdled once the Berlin wall finally fell.  
	The reunification of Germany could not have been possible if it wasn’t for the initial thought being planted in the peoples’ minds and supported by leaders.  As early as 1960, Heinrich Lübke, the president of the FRG stated that the German people “will not remain separated” and that the reunification of the Germanys is a “natural right” (Berdahl 496). This message was heard best by the East Germans who were residing in West Germany due to various reasons such as migration or expulsion from the eastern territories that Germany lost at the end of the war (Berdahl 496).  East Germany was also for reunification from early on.  The Socialist Unity Party set “’the restoration of German Unity’ as a goal” (Berdahl 497).  However, they were pushing for unity because they believed that a separated German state would lead to “West German monopoly capitalism” (Berdahl 497).  They thought that if the Nation remained separated then West Germany would take all of the imports, exports, and business with other nations away from East Germany.  Therefore the East Germans and their leaders thought that reunification was a good route for their economy.    
	Quickly, talks of a reunified Germany became increasingly porous.  There seemed, to the leaders and the people of both the FRG and GDR, to be too much conflict between the opposing governmental ideologies.  The people were just not willing to let go of what they believed was the best form of government.  In early 1989, Eric Honecker stated that he believed the wall would “remain in place for 50 or 100 more years” (Berdahl 497).  Most of the German population did not have high hopes for reunification, but it was right around the corner.
	In November of 1989, when the Berlin wall fell, the motivation was not purely political or even pursued solely by the political leaders.  The fall of the wall was caused by “a truly peaceful popular revolt” (Berdahl 497) by the German people.  Sure, the politicians had the final say, but it was the people who initiated the action and pushed over the first domino that led to the reunification of Germany.
	While the German people were jubilant with the new reunification of their “fatherland”, the people of Europe were approaching a reunified Germany with caution.  Germany has a history of trying to establish “hegemony over the continent” (Berdahl 500).  This “German Question” is not so much an issue now a day as it was with previous regimes.  Germany generally recognizes mistakes that were made in past regimes and prevent radical parties or movements from having little, if any influence in the major picture of the reunified Germany.  In recent years, the German population has been mostly anti-war.  It has participated in UN peacekeeping missions and provided support for the first gulf war but the majority of the people are against conflict, which is contrary to the German history.  The people have actively demonstrated against wars, especially when America invaded Iraq.  There is such an anti-war sentiment, that Chancellor Schröder “was reelected in 2002 because of his opposition to the American determination to invade Iraq” even though the people were strongly dissatisfied with Germany’s “sagging economy” (Berdahl 504).  This anti-war Germany is not one that has been seen in the past and provides a safer feeling for the rest of Europe and the world going forward.  
	Unification of Germany is most apparent at the center of the split: in Berlin.  Berlin, after reunification did not easily become one city again.  Rather, it was a “clash” of conflicting ideologies after a “forced separation” (Ellger 40).  
The biggest problem facing Berlin was spatial.  The spatial effect was seen mostly on the West Berlin side.  The separation of the west and east split the city.  This left West Berlin without the eastern city center.  This contained major institutions such as the “Berlin Town Hall, university, state library, the main museums on ‘museum island’, administrative and service areas” (Ellger 41).  This put West Berlin at a distinct disadvantage.  It had to redevelop all the governmental systems that it lost to East Berlin.  More importantly though, the “capitalist West Berlin had to develop its own Central Business District” (Ellger 41).  West Berlin needed to focus on getting these things put in place so that they could effectively become the capital of Western Germany.  
Another factor facing Berlin was geography.  Given the way that Germany was divided, West Berlin was surrounded by East Germany.  This “island” nature was a hindrance to development.  West Berlin was contained within the boundaries of the wall and city limits.  This prevented expansion and growth in both population and economically.  This is most apparent when “company headquarters in West Berlin – such as AEG and Siemens – left the city, because the location was seen as ‘politically insecure’” (Ellger 43).  These company headquarters went to Western Germany, so they didn’t lose the business all together, but the effect was definitely felt in West Berlin.  
East Berlin had a much easier time pre unification.  From the start, East Berlin was groomed to be the capital of East Germany.  With the governmental and housing institutions already in place, East Berlin was a thriving city.  It was the highlight of what was a generally downtrodden East Germany.  East Berlin was developed in such a way that it was to be a “showcase of the East” (Ellger 44) and did so with little trouble.  
When reunification finally did occur, there was a large problem staring Berlin in the face: “booming manufacturing and services in the West, collapsing enterprises in the East” (Ellger 44).  West Berlin and West Germany relied on mainly retail and other such industries.  When reunification happened, the retail industries had more area to sell and disperse their products.  West Berlin’s manufacturing also grew.  This was because East Germany was utilized “as a market and not as a production region” (Ellger 44).  This was mainly because West Germany’s marketing was seen as “quicker and more efficient” (Ellger 44). 
Post reunification, there was a very low investment in East German industry.  This was because of many factors such as the Treuhand and the change of currency, among other things.  
One of the main factors for a lack of investment in East German industry was the Treuhand workload.  The Treuhand is “the state holding company which has been set up to turn the public enterprises of the GDR state into workable private companies, currently holding the largest public property in the Western world” (Ellger 44).  This entity had the task of turning the companies, which were controlled by the government in divided Berlin, into privately owned companies run by the people.  With the government technically owning the business, the question arose as to who would actually own the property.  The former owners of the business had the inside track to owning the business under the unification treaty with “the principle being ‘handing back comes before compensation’” (Ellger 44).   The Treuhand encouraged management buy-outs but this was not easily done.  There was not enough capable managerial staff in East Germany and with reunification being so fresh, not enough Westerners were willing to migrated to the East.  This lack of management numbers was because the former management elite in the East had “been politically discredited or intimidated by the ‘culture shock’” (Ellger 45).  This all hindered the transition of the companies from public to private.
The switch of Eastern Germany from a soft currency to a hard currency also contributed to the struggles of the East German industries.  This affected East German companies because they “lost most of their traditional outlets in the Eastern European countries, which are incapable or willing to pay in hard currency” (Ellger 45).  This caused a period of over-production seen in the East due to none of their usual buyers buying their products.  Even with this over-production, the West was not in a hurry to help out the Eastern companies.  They, sticking with a capitalist frame of mind regarding economics, waited “for a further fall in prices” due to the fact that “bankruptcy relics are cheaper than working companies” (Ellger 45).  This caused a loss of unspecialized industries to leave the struggling Berlin for other areas in Germany or even the country, possibly for Third World countries where the labor is much cheaper.  This situation was be disastrous for Berlin due to the difficulty it faced with re-industrialization.  Berlin, because of the isolation was far behind other German countries in many fields, such as microelectronics.  Also, there was continued trouble finding people willing to take jobs in the manufacturing workforce that could have taken many years to solve.  
With the manufacturing industry seeming to be irrelevant, Berlin based its “hopes for a future on service employment” (Ellger 45).  At the time there was a rush in Berlin for “retail and office floorspace” which indicated that the service industry would “constitute a dynamic sector for the city” (Ellger 45).  The rush for the floorspace was “speculative” (Ellger 45) because there was still the possibility that Berlin would become the capital of Germany.  At the time it seemed that the manufacturing, service, and political institutions could not all occupy Berlin.  Because of this thought, and the fact that many politicians set up offices in Berlin, many German companies chose not to relocate to the city.  
	The change of the capital to Berlin “will certainly give rise to a major source of employment” (Ellger 45).  But the “speculative boom…is threatening the existence of small-scale production and service distribution for the Berlin population” (Ellger 45).  The companies and the housing in Berlin had often been intermixed in the city, known as the “Kreuzberg mixture” (Ellger 45).  With the potential for the loss of housing, the price of renting went up 600 percent due to there being “no administrative means available…to stem the price explosion” (Ellger 45).  That factor could have a huge factor on the population and distribution of the population in and around Berlin.  
	All of the factors mentioned had an affect on Berlin “becoming a normal city” (Ellger 45).  The people and economic institutions, due to the changing Berlin, “looked for locations on the urban fringe” (Ellger 45).  A popular location for the movement was the Brandenburg hinterland, which had previously been “inaccessible to Berliners” and was in the “more affluent Western part” (Ellger 45).  This is just a small section of urban sprawl that Berlin saw at the time.  There was a huge explosion in the potential for leisure-type activities with “applications for 40 golf courses and 27 Disneyland-type theme parks” given to the Brandenburg planning officials.  
	Suburbanization does not come without problems, though.  There was a problem of segregation with suburbanization of Berlin.  Many of the population that moved to Brandenburg was the “affluent young” while the population that stayed in the Wilhelminian belt was the “working-class population” (Ellger 45).  This segregation would only get worse as “an inflow of poorer migrants from smaller cities and rural areas” (Ellger 45) would move into the Wilhelminian belt.  With the focus on Berlin, there would appear to be an increase of migration to the city and the area surrounding with the opening of Germany to Eastern European countries.  With the migration it seemed as though the segregation would continue to increase with the poorer population moving into the city and the richer moving to the suburbs.  The solution seemed to be “an agreement between Berlin…and Brandenburg to coordinate planning and development procedures in the Berlin region, and to set up a joint land-use plan is urgently needed” (Ellger 46).  The purchasing of land and gaining of permission to plan by capital investors did now take place in a respectable manner, which only made the situation worse.  The pressure to create employment and the tension between the two competing Central Business Districts due to the fall of the wall did nothing to help the situation.  Experts, when discussing the issue, suggested “that any planning concept for Berlin will have to encompass the historical evolution of the built-up form and will be required to meet social as well as ecological criteria” (Ellger 46).  Basically, Berlin will have to look into the past to see how it functioned effectively previously and use that to develop a better Berlin for the future.  
	Berlin had the advantage of becoming a major city after many of cities around the world.  This may not seem obvious, but Berlin can see what has and has not worked for other major cities around the world and try to apply it to their own situation.  But with the trying to incorporate what other cities did, Berlin should preserve “as many as possible of the special characteristics of its ‘abnormal’ development” (Ellger 46).  If the historical context of Berlin was preserved many people believed that the development of the city and urban lay-out could have Berlin “again become a fascinating and beautiful place worth living in” (Ellger 46).          
	With reunification, there was sure to be some problems between East and West Germany.  But I think few expected that reunification would have impacted East Germany’s sense of identity.  East Germans experienced “loss syndrome”.  This means that although the people did not like the East German communist state and what it represented, it was their past.  This was most likely a reaction due to the culture shock.  It is not easy for a population to go from a communist to a democratic state overnight.  
	While the East Germans had a longing for their past, both East and West Germans believed that the former East German power elites had to go if the old communist system was going to be dismantled.  With the overhaul people who collaborated with the East German secret police, the Statsi, were dismissed from their positions.  This applied mostly to public-sector employees in East Germany.  In West Germany, however, the changing of elites reached far greater with politicians, economic elites, intellectuals, and people in other such positions being dismissed.  
	This rapid change bothered the East Germans.  There was a lot changing around them at the time.  The East German people saw the massive overhaul of officials as a form of colonization by the West and not a reunification of one country.  With the dramatic change taking place the East Germans began to rally around second-tier communist leaders.  These leaders, with the support of the people, began to step into leadership positions.  This also fueled conflict between the people of East Germany.  There were the people who tried to hold onto the past and the people who believed that reunification was for the best.  This caused added tension to the population while they were trying to make the transition to one country.    
	The rallying of the East Germans behind the communist leaders took the West Germans by surprise.  The West had expected that East Germany would completely reject their communist past.  They also believed that East Germany would quickly accept and adapt to West German values.  The West Germans equated the communist dictatorship of East Germany with the former Nazi regime and expected the East to feel the same way.  They did not plan on East Germany to have an almost nostalgic view of the former government.     
There were two very prominent cases of East Germans adjusting to roles in a unified country.  One was of politician Manfred Stolpe and the other of writer Christa Wolf.  Both were people that East Germans chose to rally behind during reunification even though they had very different roles and occupations.  
Manfred Stolpe was the most prominent politician remaining in East Germany after the dismantling.  He held to position of Prime Minister of Brandenburg in 1990 and had a very long career in the German Democratic Republic.  Stolpe had a reputation as a valiant champion of the “Church of Socialism” and a builder of bridges between East and West Germany.  
Stolpe admitted to meeting regularly with the Statsi.  Usually interactions with the secret police ended politician’s careers in the reunified Germany.  While Stolpe insisted that the interactions with the Statsi were only to assure them that the church activities were politically harmless many West Germans were bothered by the interaction and their perception of Stolpe was affected.  Even though the Westerners were weary of Stolpe, the Easterners were encouraged to rally behind him.  This, in turn, led to the people of East Germany to identify with a larger Eastern community.  
There was not any incontrovertible proof found for or against Stolpe’s claims for his interactions with the Statsi so many people chose to believe him.  The people identified with the tough position he was put in by the Statsi.  He also had a tremendous amount of support from Brandenburgers where he remained in power until 2002.  Because of the trust people put in Stolpe he was put in charge of reconstruction of Germany as the Federal Minister for Transportation, Construction, and Housing.  Because it was not clear which side of the reunification issue Stolpe was on it made him more identifiable to many of the East German population.  
Another figure in the reunification from East Germany was Christa Wolf.  Wolf was an East German writer who had a large readership from both the East and West German states.  She was, originally, a very committed communist who did not protest the building of the Berlin Wall and did not attempt to flee East Germany.  She believed that staying in the East was both noble and courageous.  Being very devoted to East Germany, Wolf was a Statsi informant from 1959 to 1962.  It was later found that she was of little help to the secret police and did not provide them with much information.  Eventually, Wolf became disillusioned with the communist system of the German Democratic Republic.  
While Wolf was very loyal to the East, her writing created a vision of the inner life of an individual that broke out of the mold of socialist conformism.  This did not anger East German officials because she never actually attacked the system.  Many admirers of this type of writing believe that the authors put the mindset into place that led to the rebellion against the socialist system in 1989.  
West Germany did not like the East German literary tradition.  The primary target for the dislike was Wolf.  This mindset by the West led to some people believing that West Germany was planning cultural colonization of the East.  Comments on the East German literature from people in the West offended many East Germans and revealed a mental boundary the existed between the two sides.  East German writers and intellectuals saw the attacks on Wolf, among others, as attacks on the East German cultural identity.  
Wolf failed to come to terms with East German history and her place in it.  She called for better socialism and to reject consumerism in 1989.  This caused many to believe that Wolf lacked understanding the events, needs, a desires of East Germany.  She was unwilling to admit that under the dictatorship of East Germany she was forced to make compromises and seemed to look down on East Germany for changing its form of government.  
These were two examples of how the reunification affected people in the East and how different the people could adjust.  One ended up having a lot of power in the unified state while the other appeared to be a bit delusional and refused to come to terms with the reunification and change in government.  
    This situation with the prominent figures in East and West German society pointed to the problems that the newly reunified country faced with the integration of two very different cultures.  The integration problem was critical to turning the East and West into one Germany, which was the dream of reunification.  The case of integrated East and West Germany was more like assimilating people to something that was slightly different than the norm rather than having the people adjust to a whole new country and identity.  The assimilation focused on a majority language and the history of the state.  
When the two states first merged into one country there was a noticeable difference between the residents of the East and West.  However, as time passes sociologists believe that the successive generations will become increasingly similar to the host population.  This basically says that the noticeable differences between the people who lived in the East and the West will dissipate over time.  There are five major indicators of integration.  These factors are language, friends and/or spouses, participation, segregation, and identification.  Many of the factors are the same integration obstacles faced by ethnic groups.   
   One of the distinguishing features of a unified state is that the country has a common or national language.  This was not too different between the East and West with only minor dialect and slang usage differing.  
The other four factors showed a distinct separation of the East and West public.  Post reunification the East Germans remained friends with other East Germans while the people in the West stuck together.  There was little mixing of the two populations.  There was also little participation of people in unified German events.  There were still very strong ties to their former countries.  Segregation was very prominent in post-reunified Germany.  There was a similar feeling in Germany between the East and West as the racist tensions felt in America before and during the civil rights movement.  There was also a lack of identification of the people as Germans.  The population saw themselves as East Germans and West Germans and not as one German people. 
	Right after the fall of the wall promises were made to the people of East Germany that things such as living standards would improve.  Specifically, former Chancellor Helmut Kohl, who facilitated the rapid transition from the former socialist state to the market economy, promised the residents of East Germany they “would very quickly be able to enjoy living standards comparable to those in West Germany, that unification would create ‘flourishing landscapes’ in the new Länder, and that all this could be had at virtually no cost to West Germans” (Hefeker 109).  But as time continued on, it became apparent that the promises were empty and more in the area of wishful thinking rather than something that was guaranteed to be carried out.  
 	Not too soon after reunification East Germany fell into an economic recession.  The employment in the industrial sector halved while general employment rose rapidly.  This was not a quick problem either.  Ten years down the road East Germany was still suffering.  East Germans were still suffering from open or hidden employment and the economy relied “heavily on West German transfers” (Hefeker 110).  The East German GDP grew at a lower rate than the West Germans and the promise of a flourishing East Germany did not seem to hold any weight.  And with East Germany struggling, West Germany had to pick up the slack.  The west had higher taxes, social security contributions, and public debt to “finance transfers to East Germany” (Hefeker 111). 
As with many situations, when promises are made and economics suffer, many people looked to the politics and the policy making for answers.  The “decision to establish a currency union at a conversion rate…and the wage policies pursued in East Germany” (Hefeker 111) has been looked at as policies that contribute to the struggles.  The favoring of the policies towards West Germany can be attributed back to the initial idea of reunification.  Reunification was more popular in the East so the policy platform had to reflect than and tended to favor the East and their electorate while the reunification policy was more specific to the West so that it could ease any concerns they had.  This was to comfort the West Germans allowing them to feel comfort in believing that their economy and other vested interests would remain safe after reunification.  
There have been plenty of questions with why the policies have come into place, why they have stayed unchanged while there has been no improvement, and who had an interest in the policies among other things.  An argument made by Baylis is that the policy making was “dictated more by the calculation of politicians then the designs of economists” (Hefeker 112). 
In these policies, successful reunification “relied to a large extent on the transfer of existing West German Institutions to East Germany” (Hefeker 113).  This was both economically and politically.  After reunification the West party system was to be used for all of Germany and was done so in 1990 for the first free elections of the reunified nation.  This transition was smooth at the beginning but it soon became apparent that the developing of a market economy in East Germany was going to be a lot tougher than just 
doing away with their institutions and transferring the institutions from the market economy West Germany over because “not all of the institutions transferred were adequate for an economy in transition” (Hefeker 113).  
This led to the second problem with the reunification policy in that the policy was intended to protect vested interests, which were mostly West German, against unwanted change during the transition.  This was trouble for the East German economy.  It did not take long for West German institutions to move east and have East Germany adopt the “legal, economic and social institutional arrangements” (Hefeker 114) of West Germany.  This allowed for a “fully integrated economic union with unconstrained mobility of goods and factors” (Hefeker 114).  The already struggling East German economy was now faced with competition from the newly located West German institutions.  The policy had clearly given the advantage to the western institutions so the East Germans continued to struggle.  To combat the apparent advantages given to the west a conversion rate was implemented.  
There was a high wage strategy that was put into place.  The rate paid higher wages to the East German workers to try and even out the affects of the economic inequalities.  In theory this was an ok plan but the socialist ways of the East German past was problematic.  In general, West Germans worked harder than East Germans.  It was predicted that the level of productivity of the east was “around one-third of the West German level” (Hefeker 115).  This motivated employers to hire West Germans because they were more productive and were able to be paid lower wages.  The wage rate ensured that “investment into Eastern Germany would be unattractive” (Hefeker 115).  The unit labor cost compares the productivity and the wages.  When West and East German unit labor costs were compared it shows “that unit labour costs in general have risen faster in East Germany” (Hefeker 115).  That is a confirmation that the productivity in East Germany is low compared to the high wages given to the workers.  
The increase of wages had a negative affect on the manufacturing area.  Due to the high wages, most of the manufacturing firms closed with few opening.  With the major loss of the employment the manufacturing sector did not make major gains.  The unemployment “greatly increased in the course of the restructuring of the East German economy and, in contrast to many other post-communist economies, has not come down significantly afterwards” (Hefeker 117).  
Even though East Germany was having unemployment issues some people argue that the development was not too bad if looked at from an investment standpoint.  During the first decade after reunification GDP investment share was at 20 per cent in the west while the east had investment shares of over 40 per cent.  This was partly accounted for with the lack of stock in the former communist east.  The high rate of investment in the east 
provided an odd situation.  The investments caused higher levels of capital intensity in many parts of the east as compared to the west while, at the same time, the labor productivity remained lower in the east.  
	The privatization policy was a policy that many did not look to for causation of the problem but also “served to conserve existing West German structures and export them to the East” (Hefeker 119).  It was decided to privatize East German enterprises quickly which guaranteed that a “large sector of state owned enterprises…would not emerge in one part of the country” (Hefeker 119).  In most of the cases the policy created the Treuhandanstalt,, which was a privatization agency.  The Treuhandanstalt was “under tremendous political pressure to keep as many firms as possible in business” (Hefeker 120).  The agency was responsible for the sale of “more than three-quarters” (Hefeker 119) of the enterprises being sold to the West Germany.  A stark contrast to that was that five and twenty per cent of the firms ended up being sold to foreigners and East Germans, respectively.  It even kept companies alive that were seen as unproductive.  The policy greatly favored the West as it ended up putting the majority of the enterprises into the West Germans’ hands.  But in the end, the Treuhandanstalt was a burden to the German government.  When it was shut down, the net worth was –DM270 billion, which the government was responsible for and just added to the increasing debt problems.  
	It appears that the unification policies had the short-term interests of Germany in mind but did not look too far into the future.  Instead of contributing to the mentality of “One German People” the policies instead gave the people continuing thoughts that it was one country with two very different people occupying it.  The policies clearly tried to remake the whole of Germany in the same form as the former West Germany.  Naturally, that meant the West was favored while the East was taken into consideration but greatly suffered.  The longstanding debt and unemployment in the East is just a conformation of the flaws that came with the unification policies.          
 	The economic situation seen in the East can be attributed to the pre-unification of the two Germanys.  In the East, risk management was considered something that could not be entrusted to the individuals.  The State and other higher groups were responsible for the individuals risk management.  With that responsibility taken away from the individuals, lives seemed to have “lost their meaning” (Kupferberg 76).  And because it was seen as having nothing to lose then there was also little to nothing to gain.  The people in the East seemingly went through dull everyday lives working in factories only to reap the benefits like “access to company kindergartens and holiday resorts, friends, and, most of all, social respectability” (Kupferberg 76).  With nothing to lose, and it being virtually impossible to be fired, productivity was not nearly as high as it was in the West.  
	Another problem in the East involved the residents that “did not have and officially recognized job or position” (Kupferberg 76).  The people in the category were considered “’parasites’ [and] many of them ended up in jail” (Kupferberg 76).  People also were not given jobs if they asked to leave the country.  This put in place an atmosphere in which the citizens would have to settle for a boring, mundane working life if they wanted to have any sort of personal life at all.  
	That life is all that the East Germans had known.  When they were finally allowed to venture outside of the country they were hit with social shock.  They had been under the impression that they had lived in the better system.  The citizens took a long time to adapt because they had “gotten use to a ‘guided’ society, they expected the knowledgeable state to tell them what to do” (Kupferberg 77).  The citizens were essentially ignorant as to how to act in social situations.  They had always been told what to do and how to do it.  The West system put the responsibility on the people.  This was something that was completely foreign to the people of the East.  The lacking sense of individual responsibility impeded the process of Westernizing the reunified Germany.  The slow learning curve only amplified the problem of East Germans losing jobs to the West Germans.  The productivity difference was accentuated by the social incompetence of the East.                 
	The reunification of Germany brought many different reactions from both the Germans and the world.  There was a worry that the past would come back up and Germany would again try to establish its dominance over the world.  The Germans thought that one nation would run effectively and become a world leader.  After over 20 years of a singular Germany it has become clear that neither of these situations are happening anywhere in the near future.  The world has not seen Germany try to take over all of Europe and the people of Germany are almost as segregated as when the country was divided into separate states.  The transition has not been smooth and has tested the economic, political, and social situations in Germany in an effort to appease everyone.  
While Germany is inching closer to the “One Germany” mentality that was proposed during the reunification effort there are still plenty of differences and problems that need to be worked out so that the people can live in the harmony that was expected.     

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