An Analysis of Governmental and
Economic Trends after the Wall
Legal Environment for Global Organizations
National American University
Dr. Richard Gayer
In November of 1989, the German Democratic Republic, also known as East Germany, began to crumble. As the citizens of Germany demolished the Berlin wall, the final chapter of World War II finally came to an end for the German people. The next chapter in German history, reunification, would determine how Germany as a whole would progress into the future as a global player. This paper will examine the political and economic challenges that post Cold War Germany had to overcome, and the accomplishments that it has achieved along the way to progress from a war torn country, into one of the biggest economies in the modern world. On October third of 1990, the reunification of West and East Germany into a single united country became official. The unification of the two countries essentially consisted of an incorporation of the socialist German Democratic Republic (East Germany) into the Federal Republic of Germany (West Germany). As a result of this process of incorporation into the existing political system of West Germany, much of the legal, governmental and economic systems that existed in West Germany were continued in East Germany (Gordeeva, 2009a). The government that has existed in Germany since its unification in 1990 is a federal republic with its capital in Berlin. The Federal Republic of Germany has as its constitution a legal doctrine known as the Basic Law (Germany, 2009). First Ratified on May twenty third of 1949, after Allied occupation of West Germany ended; the Basic Law became the constitution of unified Germany on October 3, 1990 with the ratification of Article 23 of the West German Basic Law (Gordeeva, 2009a). This day is now celebrated as a national holiday in Germany known as Unity Day (Germany, 2009). Article 23 of the Basic Law outlines how “political structures and policies of West Germany would be extended to the east, how other institutions – such as the educational system – would be coordinated, and which issues would be resolved later” (Gordeeva, 2009a). This was the preferred method of unification of Germany, by the West German chancellor Helmut Kohl, due to how quickly it could be adopted in contrast to an alternate plan laid out in Article 146 of the Basic Law that would have called for the abandonment of the Basic Law in favor of a “constitution developed specifically for a unified Germany” (Gordeeva, 2009a). The current system of government in Germany, which is an extension of the legal system in place in post World War II West Germany, is what many political analysts in the United States would consider in the middle of the political spectrum. This is reflective of Germany’s past, which prior to WWII was a fascist state, and after WWII was divided, with a large portion under the control of a socialist government (Gordeeva, 2009a). This unique past that Germany alone possesses has created a political climate where parties embrace a very moderate stance and avoid extremely conservative or liberal positions due to their obvious links to the past; legislators work hard to promote political stability of their nation. This tendency has established Germany as a party state where “all government policies emanate from the organizational structure of the political parties” (Gordeeva, 2009a). Due to the forethought of Chancellor Kohl, reunification of Germany, from a governmental standpoint, was a relatively simple task. The challenge of unifying two economies, one capitalist and the other socialist into a single growing capitalist economy would be a far greater task. Immediately after the unification of the East and West German economies, the unified German economy took a serious downturn. During this time, gross domestic product declined by nearly...