Chapter V

THE MARKET ECONOMY CONQUERS PLANNING

‘The economic policy began with the slogans of “Free Market Economy” and of “Liberalization”. It ended in the spring with import controls, which demonstrates the failure of the whole policy, above all as regards foreign trade … In the meantime nearly all principles and theories which the Federal Minister for Economic Affairs has repeatedly put forward here … have completely failed….

Chapter VI

MINISTER FOR ECONOMIC AFFAIRS NOT THE REPRESENTATIVE OF PRIVATE INTERESTS

I HAVE IN FRONT OF ME newspaper clippings from those first years of my work as Director of Economic Administration in Frankfurt and as Minister for Economic Affairs in Bonn. I was then called ‘Minister for Economic Affairs—Enemy of the Consumer’, ‘Erhard—Minister for Heavy Industry’, ‘The Patron Saint of Hoarders and Profiteers’, and variations of similar titles were given to me.

Chapter VII

CARTELS—ENEMIES OF THE CONSUMER

THE CONCEPTION OF the ‘social market economy’ has been found valid—and not only in Germany. Even the enemies of my economic policy no longer contest this claim. An economic policy may only call itself ‘social’ if it allows the consumer to benefit from economic progress, from the results of increased effort and increased productivity.

Chapter VIII

THE VALUE OF INDIVIDUAL OPINION

THE POSITION OF THE INDIVIDUAL within the State, or better still the attitude of the citizen to the State, should be a constant consideration of the politically responsible. On this point I want to make my position clear as a comment on the eagerness to organize (not to say craze for organization) which permeates the 20th century. Now the inherent passion of the German for associations, formerly much ridiculed, has taken on a new and dangerous guise.

Chapter IX

MARKET ECONOMY AND WAGES

MY CONSTANT BATTLE to secure true and free competition aims at supporting in the first place those forces in our country which are beneficial, and which above all should help the German economy towards a permanent progressive increase in productivity. Where there is no competition, there is a standstill which eventually leads to general stagnation. Everyone then defends just what he owns, that is, he is no longer interested in increasing his own efforts—so important a factor for the prosperity of the national economy.

Chapter X

DOES PROSPERITY LEAD TO MATERIALISM?

IN RECENT YEARS the idea that the policy of the social market economy clearly leads men more and more towards a corrupting materialism has been gaining ground.

This view should be critically examined.

Chapter XI

THE PSYCHOLOGY OF MARK AND PFENNIG

‘IF WE ARE SUCCESSFUL in changing the economic attitude of the population by psychological means, then these psychological changes will themselves become an economic reality, and so serve the same purposes as other measures of economic policy taken so far.’ In this sentence, spoken on behalf of the Federal Government in the first economic debate in the Federal Parliament on October 19, 1955, in Berlin, I expressed a fundamental principle.

Chapter XII

WELFARE STATE—THE MODERN DELUSION

EVERY TIME I SPEAK on the theme ot social security I am in danger of being accused of going beyond my brief. If I speak less as Minister for Economic Affairs and more as a political economist, it will seem natural to those knowing the subject that within the sphere of the social market economy the Minister for Economic Affairs has every reason to interest himself in further developments of our social policy.

Chapter XIII

REARMAMENT AND THE MARKET ECONOMY

REARMAMENT MUST BE SO ORGANIZED that it will not upset our free social economic system. I have held this view ever since the rearmament of Germany was first discussed. It is not dogmatism but anxiety to secure our social existence which has led me repeatedly to stress this. It is important that every contribution to defence should not merely maintain but also strengthen the freedom-loving order of the West.

Chapter XIV

POLICY THROUGH DIRECT CONTACTS

‘IN WHICH PART OF THE WORLD is the Minister for Economic Affairs now?’ has been asked several times during the past few years, when I thought it useful to leave my desk at the Ministry in Bonn, to avoid the mistake of thinking Bonn to be the centre of the world. The fact that I repeatedly felt the need to talk with persons both at home and abroad, to explain German economic policy, and to find supporters for this system, has frequently led to misunderstandings and to many critical remarks.