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East Germany Table of Contents

East Germany

Collectivization and Nationalization of Agriculture and Industry

In 1956, at the Twentieth Congress of the Communist Party of the Soviet Union, First Secretary Nikita Khrushchev repudiated Stalinism. Although Ulbricht remained committed to Stalinist methods, an academic intelligentsia within the SED leadership demanded reform. To this end, Wolfgang Harich, the main spokesman for de-Stalinization, issued a platform advocating a democratic and parliamentary road to socialism. But Harich had misjudged the temper of the times and the power of Ulbricht; in late 1956, he and his associates were quickly purged from the SED ranks and imprisoned.

An SED party plenum in July 1956 confirmed Ulbricht's leadership and presented the Second Five-Year Plan (1956-60). The plan employed the slogan "modernization, mechanization, and automation" to emphasize the new focus on technological progress. At the plenum, the regime announced its intention to develop nuclear energy, and the first nuclear reactor in East Germany was activated in 1957. The government increased industrial production quotas by 55 percent and renewed emphasis on heavy industry.

The Second Five-Year Plan committed East Germany to accelerated efforts toward agricultural collectivization and completion of the nationalization of the industrial sector. By 1958 the agricultural sector still consisted primarily of the 750,000 privately owned farms that comprised 70 percent of all arable land; only 6,000 Agricultural Cooperatives (Landwirtschaftliche Produktionsgenossenschaften--LPGs) had been formed. In 1958-59 the SED subjected private farmers to quota pressures and sent agitation teams to villages in an effort to encourage "voluntary" collectivization. The teams used threats, and in November and December 1959 resisting farmers were arrested by the SSD. By mid-1960 nearly 85 percent of all arable land was incorporated in more than 19,000 LPGs; state farms comprised another 6 percent. By 1961 the socialist sector produced 90 percent of East Germany's agricultural products (see Agriculture , ch. 3). An extensive economic management reform by the SED in February 1958 included the transfer of a large number of industrial ministries to the State Planning Commission. In order to accelerate the nationalization of industry, the SED offered entrepreneurs 50-percent partnership incentives for transforming their firms into VEBs. At the close of 1960, private enterprise controlled only 9 percent of total industrial production. Production Cooperatives (Produktionsgenossenschaften--PGs) incorporated one-third of the artisan sector during 1960-61, a rise from 6 percent in 1958.

The Second Five-Year Plan encountered difficulties, and the regime replaced it with the Seven-Year Plan (1959-65). The new plan aimed at achieving West Germany's per capita production by the end of 1961, set higher production quotas, and called for an 85 percent increase in labor productivity. Emigration again increased, totaling 143,000 in 1959 and 199,000 in 1960. The majority of the emigrants were workers, and 50 percent were under 25 years of age. The labor drain, which had exceeded a total of 2.5 million citizens between 1949 and 1961, resulted in the August 1961 SED decision to build the Berlin Wall.

Data as of July 1987