Comeback

Businessmen and bankers, the reports revealed, have never had it so good. Production is zooming, so are exports; there are more cars on the highways, more and better food in the stores, more gold in the Federal Treasury, more money spent on vacations, and more people sending food packages to Britain than at any other time since World War II. That was the word transmitted last week to the Organization for European Economic Cooperation (OEEC); but the nation it applied to was not the U.S. The booming giant, bursting its economic britches, is West Germany.

Debtor to Creditor. The German comeback could be measured in Bonn's own statistics. In 1948 the index of German industrial production stood at 56 (1936: 100); today it is 159. German exports increased about seven times in the past four years, and 75% in 1951. From being the biggest debtor in the European Payments Union (TIME, July 21), Germany has become its largest creditor, with a cumulative credit in September of $450 million.

At the base of German recovery is the reconstructed Ruhr, which is already overtaking Britain in steel production. Ruhr production in September:

P:1,387,000 metric tons of steel--up 22% since September last year;

P:10,294,000 metric tons of hard coal, an increase of 10% over 1951 but still nowhere near enough to maintain exports and feed its blast furnaces, which still rely on expensive U.S. coking coal.

Boom. U.S. aid (total: $3.4 billion) made German recovery possible. Currency reform and the laissez-faire economic policy adopted by Konrad Adenauer's businessman Government gave Germans a driving incentive to rebuild their factories, buy new machinery on credit, and go without to make the monthly interest payments. Yet it was German hard work that overnight turned revival into boom. German heavy workers, with the approval of their trade unions, put in up to 54 hours a week for an average wage of $18 to $22. Many Ruhr factories keep going full blast on Saturdays and Sundays; their employees are often on the job at 6 a.m.

Partly, the explanation is an overabundant labor supply, without which German employers could not demand so much of their men. Well over a million Germans are still out of jobs; millions more, mostly refugees, are underfed and badly housed. Despite the boom, the average per capita food consumption in Western Germany is about 10% less than prewar.

Bonn officials, anxious to convince the Allies that Germany cannot afford to shoulder a larger proportion of the West's planned defense budget, make much of the workers' poverty. Reporting last week to OEEC, they carefully explained that the Federal Republic is burdened with 1) 10,000,000 Soviet-zone refugees; 2) three occupation armies; 3) an $822 million reparations debt to the Jews; 4) an annual expense of $150 million to sustain West Berlin. Yet, as the nervous French and British often point out, the Ruhr's burgeoning capacity is more than enough to take care of these obligations. For all Bonn's protests, Germany is probably the only major European nation that can substantially increase its defense contribution without seriously impairing its standard of living.

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