East German general election, 1990

[Peter the Lefty]

      East Germany is experiencing an unprecedented wave of change and reform.  Few would have expected that only a year after Otto Graf Lambsdorff was returned to power in West Germany, protests had swept up the entire GDR, and the hardline leader of the country, Erich Honecker, was removed at an SED party conference and replaced by the more-moderate Egon Krenz.  Still, Krenz was unable to fight the massive tide of popular opinion, and was seen as little more than Honecker-lite.  A miscommunication soon lead to the fall of the infamous Berlin Wall, and the fall of the East German regime right along with it appeared inevitable.  
      In the West, Lambsdorff, who had provoked outcry with his spending cuts and deregulations, suddenly became popular once again, and very much so.  He began to push for the swift reunification of Germany, and managed to win American and Soviet backing in order to push back against the fear of a reunified Germany among both the French and the British governments.  He made it clear that his next political "unification" would be the creation of a strong European Union, ensuring that the reunification of Germany could not result in another continental war.  
      Quite soon after the wall fell, the East German parliament, or the Volkskammer, repealed the clause in the GDR's constitution guaranteeing the SED's right to rule the country.  It was agreed that in May of 1990, East Germany would hold its first free and democratic elections, and hopefully, its last.  Opposition parties were legalized, and the tide of reunification seemed irreversible.  

      The Alliance for Germany is an electoral grouping of the East German Christian Democratic Union (CDU) (once a satellite of the SED), the more right-wing German Social Union (DSU) (which appears to correspond with the West German CSU), and the church-based opposition group known as the Democratic Awakening (DA).  It is promising to make the reunification with the West as swift as possible, and to liberalize the economy in the meantime.  Its transformation into an opposition party has been remarkably swift, considering that the CDU once voted consistently for all SED-backed proposals in the Volkskammer.  Lead by Lothar de Maziere, the chief of the East German CDU, it still seeks something of a social-market economy, much like its Western counterpart.  
      The Social Democratic Party of Germany (SDP) in the DDR was illegally refounded on October 7, 1989, as a successor to what had briefly been the East German chapter of the SPD in the late 1940's before it was forced to merge with the East German chapter of the KPD to form the SED (a party in which the former KPD members consistently dominated policy and official appointments).  Like the CDU and its allies, it seeks a swift reunification with the West, but wants the economic reunification to be slower.  It also seeks economic liberalization, but wants it to result in the creation of a social democratic economy rather than an American-style capitalist one.  Lead by Ibrahim Böhne, it is intended in every way to be an East German version of the West German SPD.  
      The Party of Democratic Socialism (PDS) is the reincarnation of the SED after its dissolution.  Its campaign is being co-lead by the current Prime Minister, Hans Modrow, and its chairman, Gregor Gysi.  Both Modrow and Gysi are reformist to such an extent that neither of them could have risen very far under Honecker (and neither did).  Both claim to be ideological counterparts of Soviet Premier Mikhail Gorbachev.  The party officially backs a significant degree of economic liberalization (inspired by those of Gorbachev), and a quick transition to democracy.  However, there are a large number of members of the "old guard" in this party, and it is not very keen on reunification.  
      The Alliance of Free German Democrats is widely considered to be the East German counterpart to Otto Graf Lambsdorff's LBD in the West.  It backs probably the most extensive economic liberalization program of all of the parties, seeking the dismantling of the welfare state, privatizations, and absolute free trade.  Expectedly, it is calling for the swiftest possible reunification with the West.  This grouping is the result of a merger between what had been the LBD of the East, the German Forum Party, and the Liberal Democratic Party of Germany, a former satellite of the SED.  
      The German Movement of Social Liberals is intended to be an East German counterpart of the FDP.  Lead by Wolfgang Ullman, a theologian (which is considered ironic for a liberal party) and left-liberal dissident, the party is seeking liberalization of both the economic and political spheres, but also social justice, which it accuses the other parties to its right of ignoring.  It seeks swift reunification with the West.  
      The Alliance 90 is more of a citizens group than a political party.  It is a merger of the New Forum, the Initiative for Peace and Human Rights, and Democracy Now.  Its main goals are democracy, human rights, and the freeing of political prisoners, each of which is a goal of every other party (minus the NDPD, which I'll get to later).  It includes citizens' initiatives and student groups with these aims, as well as church organizations.  If anything, it is more center-left than center-right.
      The Democratic Farmers' Party of Germany (DBD) is officially a party claiming to represent the interests of East German famers, but has always been a satellite of the SED, and still is in certain ways a communist satellite.  
      The Green Party is running in an alliance with a feminist organization known as the Independent Women's Group.  Like its Western counterparts, it is anti-establishment and pro-grassroots democracy, though perhaps more realistic than the hippies who dominate the Greens of the West.  It includes feminists, environmentalists, pacifists, democratic socialists, and gay rights activists.  
      The National-Democratic Party of Germany (NDPD) is essentially an East German counterpart to the West German NPD.  Neo-Nazis, in short.  The main difference is that it used to be a member of the SED-controlled National Front, and acted as essentially the regime's neo-Nazi satellite.  
      The Democratic Women's Alliance of Germany (DFD) is a feminist organization founded in the early years of the GDR with the intention of being the regime's ambassadors to the feminist movement.  Seeking women's representation and social justice, the party now is attempting to run independently.  
      The United Left (VL) is a grouping consisting of socialist opponents of the regime.  Among its ranks are Trotskyists, Christian socialists, Titoists, and former SED members who turned critical of the regime's policies.  It is seeking to preserve the GDR and recreate it as a truly socialist and democratic state.  

[Donerail]

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Well where's the fun in that? Voted VL.

[Snowstalker Mk. II]

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Well where's the fun in that? Voted VL.

[Peter the Lefty]

SPD for me, though the Greens are also awesome.

[TNF]

VL!

[Peter the Lefty]

Looks like I spoke too soon about unforeseen results...this should be very interesting.

[Deus Naturae]

Alliance of Free German Democrats

[Goldwater]

Alliance of Free German Democrats

[Dr. Cynic]

Went with the Social Democrats

[H. Ross Peron]

Went with the Social Democrats

[traininthedistance]

Alliance 90, narrowly over the Social Liberals and the Greens.

[Snowstalker Mk. II]

Come on guys. Even if you don't like their politics, a GDR that survives past 1990 would be a fun twist.

[TNF]

Come on guys. Even if you don't like their politics, a GDR that survives past 1990 would be a fun twist.

Especially a democratic socialist GDR.

[Peter the Lefty]

Come on guys. Even if you don't like their politics, a GDR that survives past 1990 would be a fun twist.

Especially a democratic socialist GDR.

It would be even better if we had a unified democratic socialist/social democratic Germany.  Of course, the right-wingers have taken over this series, so that's definitely not going to happen.

[Peter the Lefty]

This vl surge is certainly interesting.  I suppose most of them will contribute to the Fundi wing of the Greens once reunification is carried out.  Perhaps this could save them after their humiliating defeat in 1988. 

[Deus Naturae]

Who is it that votes for the neo-Nazis every election?

[PJ]

Going with Social Democrats again

[Wake Me Up When The Hard Border Ends]

DSU

[🐒Gods of Prosperity🔱🐲💸]

Democratic Awakening!

[Cassius]

DSU. The lefts total failure so far is most amusing, even by the standards of this series.

[Franknburger]

I had spent several hours on an extensive post about German unification and its consequences, but somehow I seem to have deleted the first part instead of posting it. At the moment, I am neither in the mood nor have time for redoing it all again. So here is just the final part, which obviously lacks context - sorry in advance. Maybe I put something on the other issues together again, if somebody is interested:

3.Privatisation policies: This is actually about a number of issues. Let's start with the monetary overhang that, as I have explained above, in contrast to several other Eastern European countries wasn't sterilized by the GDR, and exaggerated further by the currency union. It would have been possible to stipulate that any savings above a certain amount may only be used for investive purposes, e.g. creating or purchasing an enterprise. Instead, monetary wealth ended up in new cars (which often ended up on a tree as neither East German roads nor drivers were prepared for the speed those cars could run), and when privatisation gained pace, hardly any East German had the means anymore to participate. Selling estate flats to tenants, as in Bulgaria, could have been an option, but was never considered seriously, Converting large state-owned enterprises into joint stock companies, with preferential stock purchasing options for East Germans - never considered. Cutting up conglomerates into small, digestible pieces to be privatised individually - there have been quite a number of cases, but management/ employee buy-outs often suffered from lack of capital.
The prevailing strategy was to call in external, preferential West German companies to initially run and subsequently take over and restructure East German enterprises. This is obviously not easy when you are dealing with, e.g., the world's largest manufacturer of rail vehicles (though that case, where Bombardier Industries finally stepped in, is still one of the success stories). It worked in a handful of cases (e.g. car industry), but usually resulted in a potential competitor being eliminated, at best with taking over some of the staff (Lufthansa-Interflug case), at worst by in classical leveraged buy-out manner stripping an yet on-going enterprise of all cash and than leaving it to die.
Effects by 1995: Around 240 billion DM public loss, 5% of enterprises sold to East German investors, and 85% to West German investors (10% to international investors). 1.5 million of initially 4.1 million jobs were maintained. Although the job loss shouldn't be primarily blamed on privatisation, but more on the disastrous state of the GDR economy, and the 1:1 currency conversion, "blossoming landscapes" definitely look different. Unsurprisingly, many East Germans felt having been "taken over" by the West, and voted accordingly, namely PDS / Linke.

4. Financing unification costs: 240 billion DM privatisation losses, infrastructure investment at least as high as that (I could probably find the numbers somewhere, but writing this is already taking more time than intended), unemployment benefits and pensions for East Germany - how shall it all be financed. Well, first of all, directly after being re-elected in 1990, Helmut Kohl's CDU/CSU/FDP coalition revoked his "no tax increase" promise to increase both income and fuel tax (VAT and a number of other tax increases followed later on as well). Secondly, social security contributions went up to finance East German pensions, unemployment benefits and health insurance cost. Finally, German public debt increased at unprecedented speed, which of course sent ripples through international and especially EU financial markets. This effected negatively on investment (higher interest rates) and employment (the raise in social security contributions, to be equally borne by employers and employees, increased labour cost). So, who paid for unification? Entrepreneurs, employers, employees, consumers, future generations (plus debtors abroad, that had their interest rate going up). Well, that's everybody, isn't it? Actually not, it is only those that are creating wealth.
Who gained from unification? First of all, of course, East German pensioners and those with huge saving accounts. Secondly, all those that had socialised assets being returned to them. Now, I neither have a problem with a small-scale enterprise socialised in 1970 being returned to the original owner, nor with someone having her/his parental house handed back -  to the opposite! But in most cases, it was about agricultural lands socialised in the 1950s being returned to people that didn't have any idea that their grandfather used to own that land. And, if that land happens to be in the Berlin, or Leipzig, or Dresden periphery, it is suddenly prime construction land and worth a fortune. In West Germany, any windfall profit from turning agricultural into housing land used to be heavily taxed. Not so in the East - people got the land back for nothing, weren't taxed on windfall profits, not even on any increase in land value between, say, 1953 and 1991.
Then, of course, there was massive east-west migration (intended to be contained by the 1:1 currency conversion, but that didn't stop East Germans from going West, initially in search for better-paid jobs, later for getting a job at all). That influx had housing rents and real estate prices in West German metro areas going up. The former were taxed, but windfall profits from the latter not (respective tax code reform only occurred several years after 1990). Essentially, we are talking the biggest re-distribution of wealth in German history from employers/ employees to land owners, with the former shouldering most unification costs, and the latter getting a free ride!

[Returning to the scenario here: Most of the points I have mentioned have become clear in hindsight, but weren't discussed publicly when respective decisions were taken. That's probably how history evolves - a bit of ideology (privatization/ reconstitution), a lot of technocracy (pensions are to be financed by employers and employees, why should a minor event such as German unification affect that principle), and political leaders on all sides too overwhelmed by current developments to grasp the long-term implications of certain decisions. If that's so, it all depends on the right people (those with the potentially least harmful ideology) being in power in decisive moments. Against popular opinion, I don't think Helmut Kohl was the right man to manage unification (nor was Schäuble, who took charge of most details), but we will never know if anybody else would have done a better job.]

[Yeahsayyeah]

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Though it now may be in this scenario for reasons I don't know, it had nothing to do with such IRL in 1990. Though it was at first founded in 1949 to organize nationalists into the bloc-party-system this role vanished very soon, as German unity became less and less probable, and it then became very similar to the LDPD in member structure (petit-bourgeois and intelligence) and official ideological outline. As ist had no unique selling point it totally collapsed  in 1989/90 and its remnants eventually merged into the FDP.

Their also would have been no point for a state with an antifascist state ideology to have an outright "neo-nazi-satellite".

Eventually its remnants merged into the FDP.

[Yeahsayyeah]

Another point: The main reason, the DSU was established under this name, was that (west German) CDU prohibited CSU from reaching out to East Germany. As they are not sister partiies in this scenario, their would be no reason for the CSU to back down.

PLEASE NOTE, that there was no electoral threshold in the 1990 Volkskammer elections.

My choice would be one of the groupings of the civil movement (VL, Greens, B90), but I'm going with the PDS for realistic results stuff.

And one question: If there is a majority of BFD and Alliance for Germany, things would not look that different than IRL, would they?

[Antonio the Sixth]

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Well where's the fun in that? Voted VL.

[Yeahsayyeah]

I assume from these results, that SPD's Ibrahim Böhme has already been exposed as informant of the State Security, by election day, but DA's Wolfgang Schnur has not?

And for that VL result to happen a huge chunk of "oppositional", "gorbatshevite" or "reformist" SED/PDS members would have been needed to come over for seeing SED/PDS as not able do reform itself. And this does not really make sense, if GDR history is mainly as it was IRL, here, and the PDS is lead by Modrow and Gysi. (Although I can clearly see what makes VL so appealing for my fellow left-wingers, policy-wise. They were only a marginal part of the civic movement, more like discussion circles and alike in a few cities and towns, and gained 0,2 percent of the vote.

But if there are this strong, I could imagine them reaching out to left groups in the West and a relatively strong "United Left", without a schröderesque SPD. The other option would be reunification with the PDS at some point. (IRL most of its members went to PDS and Greens alike, later).