Transitions to Capitalism and Democracy in Russia and Central Europe: Achievements, Problems, Prospects

By M. Donald Hancock; John Logue | Go to book overview

CHAPTER 9 Beyond Privatization: Capitalism and Democracy in Unified Germany

M. Donald Hancock and Helga A. Welsh

As Ralf Dahrendorf cogently reminds us, good social science "should start . . . from a problem that removes all statements from the tedious fog of arbitrariness and provides the whole with a beginning and an end." 1 Dahrendorf's analytical problem concerned the viability of liberal democracy within the "complex reality" of West German society as it existed in the mid-1960s. Our own quest is to assess the linkage between the extraordinarily rapid pace of privatization in the former German Democratic Republic (GDR) and its economic, social, and political consequences (many of them unforeseen) within the reality of unified Germany. The impetus for system transformation in the GDR began with the "people's revolution" of 1989, which set into motion the economic, social, and political unification of the GDR and the Federal Republic of Germany between July and October 1990. Its ending lies less in the successful transfer of institutions and the incorporation of former East Germany into the social market economy and democratic political system of the "old" Federal Republic than in the continuing problematiques of integration and equalization.

Within the universe of postcommunist regimes, eastern Germany is, in many ways, a singular case. Fundamental system change has occurred, not within the established boundaries of a nation-state such as Poland and Hungary but within the context of German unification. Eastern Germany was effectively absorbed into the Federal Republic (cynics term the process one of "corporate takeover"), thereby appropriating the constitutional norms, political institutions, ownership principles, and organizational structures of a highly successful Western model of industrial-democratic polity.

The eastern German case constitutes a distinctive trajectory of privatization and democratization in comparison with Russia and the Central Europe coun-

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