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German History: 3 Living Standards - FRG - Coggle Diagram
German History: 3 Living Standards - FRG
The collapse of living standards in 1945
Severe food shortages
Due to agricultural production completely collapsing
Millions of houses detroyed
Led to lack of food and shelter so more disease in infant mortality
Prostitution and fraternisation with allied soldiers as they gave access to goods (chocolate/ cigarettes) which they could trade
Families had to share rooms, cooking and washing fascilities
Women had to work cleaning the rubble of the streets
1948 currency reform
Abolished rationing
Wiped out savings causing distress
Rise in standards from the 1950s
Economic miracle in 1950s and 60s
Economy grew 8% per year
Included currency reform, infrastructure investment and tax incentives
Calorie intake rose, higher average earnings, shorter working week, generous holiday provisions and low inflation rate
Improvements
People could find jobs to live in comfortable homes, afford luxuries and durable consumer goods
More modern buildings with pedestrian shopping areas
Improved factory environment which improved worker productivity and motivations
Hospitals were modern and health provisions were good
Agriculture was modernised and mechanised reducing poverty
Erdhard
Believed in 'prosperity for all' and 'giving a safety net' to weaker members of society
Construction law 1950 ensured safety and quality of construction projects
Equalisation of Burdens Law 1952 made tax based on property value which was used for construction
Pensions Act 1957 gave unemployed, disabled and retired 60% of the average wage level so standard of living wouldn't fall behind
Codetermination Law 1951 made supervisory boards in companies to make better coordination between management and labour
Decline in living standards since 1970
Due to economic challenges faced
Arab-Israeli war led to oil crisis of 1973
Led to increase in the price of oil
Higher prices for consumer goods (food and transportation)
High inflation
Overall reduced purchasing power of German households
Faced increased competition
From other industrialised nations (eg Japan)
Struggling to keep up with technological changes
This added pressure to profit margins causing layoffs and wage cuts
Workers went on strike and there was protests against the government economic politics (Government responded with wage freezers and austerity means)
Full employment in 1969, 1 million unemployed 1975 and 2.5 million 1983
Inequalities
Gap between the rich and the poor remained
Low income households were single old age pensioners as state pensioners were small
'Two thirds society' 2/3 of the population was comfortable and had a political voice and 1/3 was poor and ignored
1980s housing issues as working class areas pulled down for apartments and business
Region disparities as the South was more prosperous than the North due to industrialisation and infrastructure development
Women in West Germany faced discrimination in the workplace and unequal pay
Criticised as being a 'materialistic society'
Economy caused too much environmental damage
Critics thought life quality was more than GDP and incomes