The lived experience of market orders

Harald Jähner’s recent book Aftermath: Life in the Fallout of the Third Reich 1945-55 is a fascinating window onto German life during the end of one social order and the creation of another one; it covers everything from “rubble tourism,” mass migration and regional cultures to to jazz dance halls, sex toys, interior decoration and avant-garde art.

There is also quite a lot on how the people living in Germany’s ruined cities made ends meet on a daily basis, through a combination of official rations, looting and the black market. Jähner’s reflections on how people’s lived experience of these different types of economic systems influenced their thinking is interesting if somewhat speculative:

In an atmosphere of mistrust and curiosity, the black market was a vital learning experience for the Germans, offering a radically different trading experience and providing a fundamental corrective to the Volk community fetishised by the Nazis. It was a lesson that remained in the memory for many years. Its lack of defined rules, which “rewarded the cunning and punished the weak,” created an economic terrain “in which people had apparently once more become wolves towards their fellows,” as the historian Malte Zierenberg writes. The widespread wariness so characteristic of the 1950s found a powerful source here. That narrow-minded, stuffy atmosphere that lingered around the black market was the smell of mistrust. Even the appetite for cleanliness, tidiness and order in 1950s Germany, which appeared strange to the next generation, had an origin in the chaotic conditions of the illegal markets.

The black market only thrived because of the existence of its opposite pole, the rationing system. On the one hand the wild interplay of raw market forces, on the other rationed per-capita distribution. People were caught between two different systems, always experiencing both at the same time: the state dirigisme of the shortage economy and the anarchic freedom of the unbridled market. Two conflicting logics of distribution, both of which had severe shortcomings.

This daily exercise in practical sociology, with all the exertions that it entailed, explains the unshakable faith that West Germans would later bring to the system of the “social market economy,” which, from 1948, became the patent remedy for the emerging Federal Republic. The very phrase sounded like a magical formula, because it reconciled both sides: the caring state ensuring that everybody got something and a free market system that was demand-led and placed the consumer at its centre. The few black-market years ensured that the social market economy became an article of faith for generations.

This “practical sociology” of ordinary people may not have directly determined the top-level government policy decisions that built Germany’s postwar social market economy. But the functioning of that system, like any other, depends on some shared consent to and understanding of economic norms.

His discussion also reminds me of the way popular support for the planned economy in China fell apart in the 1970s. At first this happened in the scattered local experiments with local agricultural markets and light industry that were facilitated by the chaos of the Cultural Revolution; Frank Dikotter’s wonderful 2016 article on “Decollectivization from Below” compiles a lot of fascinating archival material on this theme. The government’s later, more organized efforts to build a “socialist market economy” were informed by this widespread rejection of the old system, a discontent that was all the more effective because it was based on practical lived experience rather than ideological preconceptions (see my older post on China’s grassroots market liberals).

2 Comments

  1. Andrew, thank you for this post. The description of post-War Germany as transitional, “the end of one social order and the creation of another one,” as being a period of social learning or “practical sociology” from lived experience is very much what I’ve been thinking and writing about with respect to Russia’s transition in the late Gorbachev and early Yeltsin years: https://www-tandfonline-com.ezproxy.middlebury.edu/doi/abs/10.1080/1060586X.2020.1833558 . Transitional periods like these, and the lived experience therein, have the capacity to leave enduring impressions on people’s worldviews. Thank you for pointing me in the direction of this history as well as Dikotter’s on China during the Deng years.

    Reply

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