Page 172 - The Making of the German Post-war Economy

1949 – CONTENTMENT AND CONFIDENCE 145

as Chancellor on 15 September, Franz Blücher (FDP) becoming Vice-
Chancellor. Kurt Schumacher, who furthermore had just lost against
Theodor Heuss (FDP) in the poll to be the first President of the Federal
Republic, then chaired the SPD parliamentary group in the Bundestag,
which convened for the first time on 7 September 1949. The Social
Market Economy’s strongest proponent, Ludwig Erhard, was appointed
Minister for Economic Affairs.
The Bizonal Economic Council, which was according to the Basic Law
officially replaced by the democratically elected Bundestag as parliament of
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a new trizonal state, formally dissolved by act and ordinance of the
American and the British Military Government on 1 September 1949.
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Until its end, this first post-war quasi-parliament had been relatively
unpopular despite its achievements in both the economic and the political
spheres. In its two years of existence, the Economic Council submitted
171 bills of which 131 became law in the Bizone and Trizone respectively.
Political power struggles and conflicts of competence between the political
parties, however, meant that in 1947 just 6 and in 1948 merely 49 bills
were legislated. This in turn had led to prevalent disappointment and
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disenchantment with politics; due to the economic and psychological
malaise at the time, people expected from the Economic Council
commonsense cooperation for the sake of their needs. While the
economic situation gradually began to improve as early as 1947, the
institution in Frankfurt remained unloved mainly due to tenacious
unemployment and widely perceived inequity intensified by the monetary
reform. Moreover, the unpopularity of the Economic Council and the lack
of confidence in governance were also due to a perceived lack of
transparency in political decision-making and a low policy responsiveness
to public concerns. Although the Economic Council neither formed part
of a direct democracy nor were its members publicly elected
representatives, one may assume that the quasi-government in this
economic parliament was indirectly guided and influenced by the public
and its preferences. Indeed, it is arguable how much political consideration
could be given to public preferences especially in these times of economic
and political reconstruction. But precisely due to these extraordinary
economic and political circumstances and following the dictatorship of
National Socialism, it was the more essential to restore faith in
government and its economic and socio-political agenda. The
establishment and perpetuation of both the Social Market Economy and
democracy in general in post-war Germany ultimately required an
individual’s active political engagement on the one hand but also the
inclusion of the populace in political decision-making on the other hand.
Despite their initial low level of political interest, Germans gave