Chapter 6

Chapters Six and Seven continue the focus on West Germany from Chapter Five. Chapter Six examines the co-determination debate in Germany. As the Productivity Program tried to implement the US model of collaborative labor relations in European countries, the German trade union umbrella organization, Deutscher Gewerkschaftsbund (DGB), rejected this model and instead fought for co-determination—a form of corporate governance in the tradition of Weimar German labor relations that gave labor representatives a say in corporate decisions through works councils and labor directors. Despite a much-criticized intervention of NAM delegate Eldridge Haynes in the co-determination debate, the West German parliament passed co-determination legislation in 1952. Co-determination introduced a corporatist element into West Germany’s social market economy. Envisioned by Ludwig Erhard, West Germany’s first economic minister, the social market economy aimed for free competition, protected by the state, to provide everyone with the opportunity to develop their economic potential. In contrast, co-determination gave corporatist bodies like labor unions and business associations a say in economic decisions through regional industry-wide collective bargaining and representation on corporate boards of trustees. The German economy thus combined Erhard’s emphasis on competition with corporatist elements.

Meyer Bernstein, “Memorandum re Eldridge Haynes Letters” (1951)

US labor unions supported the Marshall Plan’s effort to convince Europeans, and in particular European labor unions of the benefits of US productivity to lure European workers away from Communist promises; to this end, US union officers served in the Marshall Plan’s labor division…

Paul Fisher, “Memo: Assistance to German Labor Organizations in the Administration of Economic Co-Determination” (1951)

This memo, written about two weeks after co-determination legislation passed the West German parliament on April 19, 1951, addresses the question what assistance the Marshall administration may provide to German unions in the implementation of co-determination…

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