Note to the Left: The Experiment Failed an analyst with the Ayn Rand Center

WASHINGTON, November 12, 2009–“One thing the anniversary of the fall of the Berlin Wall should remind us of, in addition to the sheer brutality of communism, is the economic devastation it caused–and the unequivocal economic superiority of freedom,” writes Don Watkins, an analyst with the Ayn Rand Center.

“From the end of World War II until the collapse of the Berlin Wall in 1989, East and West Germany were separated, not only by bricks and mortar shells, but by economic doctrines.

“While retaining various forms of welfare and interventionism, Western Germany’s economy was largely free after the war. Property was privately owned, and prices and wages were determined by market forces. East Germany, however, conformed to Soviet-style central planning. The Socialist Unity Party of Germany oversaw all production, most of the means of production were owned by the state, and prices and wages were placed under centralized control. In other words, the government dictated what to produce, how to produce it, and how to distribute what was produced.

“The differences were so stark that mere statistics don’t fully capture the East’s economic despair. A 1963 article in Time magazine remarked: ‘East Germans are barely getting enough to eat. Their faces tend to look grey because of the lack of citrus and other fresh fruits (the average consumer gets fewer than five oranges a year). With the exception of bread, meal, some baked products and margarine, most foods are rationed.’

“It’s no wonder East Germany needed a wall to keep people from fleeing–or that so many East Germans were willing to risk their lives to escape.

“The contrast between East and West Germany reveals, at the deepest level, the true source of wealth production: freedom.”