Behind the shining scenes of Berlin: The costs of reunification

Berlin has been running alien reconstruction policies since the nineties. Now that the city’s arty lifestyle makes it increasingly attractive, it is struggling to balance the books while at the same time preserving its authenticity.

At the back of a bar in the Kreuzberg district, migrants play ping-pong with retirees on a patched-up table. They share cannabis joints in a general good mood. A few kilometers away, mothers with tattoos and dreadlocks stroll their children on the long landing tracks of Tempelhof, an abandoned airport in the heart of the city. An impressive diversity of nationalities, genres, ideas and tastes covers Berlin with an atmosphere of striking freedom and tolerance. The city has seen it all in the 20th century and a certain magic emerges from the intuition that Berlin is always at the forefront of human history. Its streets open endless horizons where everything is possible. Its monuments seem to withstand the test of time. But beyond Berlin’s stunning authenticity, it stands out through an enigmatic, inexhaustible energy. A particular state of mind brings together quiet families and young punks, the techno scene and the city’s 170 museums (more than in New York). Its “live-and-let-live” attitude seems to bring the real coherence that unites the two sides of the city that used to be opposed in every way only 30 years ago.

Necessity is the mother of invention

In the 1980s, West Berlin was already a prized destination for fans of techno raves and alternative squats. But the fall of the Wall gave the ultimate impetus that would launch Berlin’s dynamic of creation. Artists suddenly flocked from all over the world, attracted by the low real estate prices and the city’s media coverage. The very large number of abandoned urban spaces, combined with its libertine atmosphere made the city a breeding ground for cultural innovation, alternative music and ephemeral art. Berlin was experienced as a virgin space whose industrial wastelands were only waiting to be transformed into techno nightclubs, such as Tresor, the WMF or E-Werk, which appeared between Friedrichstrasse and Potsdamer Platz in the 1990s. The relatively low cost of living allowed associations and Bohemian artists to take over the Berlin cultural scene. In the aftermath of reunification, the city was sorely lacking in resources. Cuts in public subsidies caused the closure of several cultural centers such as the Schillertheater, but they also stimulated innovation. Berliners are familiar with the saying: “Not macht erfinderisch” (Necessity is the mother of invention). Back in the Weimarer Republic, Burlesque made a stunning appearance in cabarets as a consequence of economic misery. “People had nothing else to sell than their own bodies,” a cabaret dancer explains. Since the 1990s, the city administration has been doing its best to encourage cultural dynamism: in 2016, the Berlin’s fiscal court allowed an ugly concrete building the tax benefits of high culture centers rather than that of entertainment on grounds that the Berghain, a former power station in the Friedrichshain district, happens to be one of the most legendary nightclubs in the world.

Since the 1990s, Berlin’s rapid cultural development seemed to reconcile East and West and give the city its status as a German metropolis alongside cities such as Frankfurt, the country’s financial center, and Munich, an industrial hub. The direction taken by the city is linked to the population’s desire to preserve a certain simplicity and a local dimension. The Berliners are very attached to their “Kiez” (neighborhood), and have often protested against major urban modernization projects. When real estate developers considered transforming the abandoned Tempelhof airport, four times bigger than New York City’s Central Parc, to build new commercial areas, offices and some 4,700 homes, a referendum decided otherwise: in 2008, 64.3% of Berlin’s voters chose to leave it an immense wild space and turn it over to the public. Berlin has thus become an ambivalent showcase for Germany. The city is now the third most visited in Europe. Tourists can experience the harmony between Kiez and Ku’damm (the city’s main shopping street) at the most affordable price in the cheapest of Europe’s metropolises. However, a darker side lies behind the scenes. Berlin managed to remain “modest”, but this town-like spirit now makes its attractiveness. Rising issues remind the city of its responsibilities as threats its unique identity increase.

The other side of the coin

Even though it can sound sarcastic, Germany history has the habit of repeating itself. While those who dreamed of seeing Berlin grow economically at the speed of the famous “Wirtschaftswunder” (economic miracle) of the 1950s do not like to hear it, the city seems to draw its inspiration from its ‘decadent’ cultural development of the 1930s. The city’s reunification project is far from being completed and its cost far from being covered. The recent breakthrough of the far-right party AfD (Alternative for Germany) in East Germany puts the German federal state’s failure in the spotlight. It is struggling to bring together two entities that have developed economically, socially and administratively in opposite ideological directions for 40 years. Despite the implementation of a major policy of convergence between the Western States, engines of growth, and Eastern States lagging behind in economic growth, the gap remains abyssal: according to Deutsche Welle, workers in the East earn an average of 900€ less than those in the West each year. Regarding life expectancy, although East Germany has almost caught up since the fall of the Wall, East Germans still live one year less than their West Germans counterparts.

These disparities were corrected in Berlin at the cost of an abyssal budget deficit. Large-scale urban renewal projects such as Potsdamer Platz, Friedrichstrasse and the new Government Palace on the site of the wall were launched to give coherence to the city centre. Funding programs were undertaken in Eastern districts such as Prenzlauer Berg and Friedrichshain. East Berlin was integrated into the Western system through the transfer of political-economic structures and tools, which created a sense of invasion in the East by the bureaucracy and elites of the West. Western triumph over the East has created an underlying animosity. While the factories abandoned when Berlin was nothing but a Western stronghold in the middle of the Soviet bloc have been the playground of the most creative minds since the fall of the Wall, deindustrialization is now holding back the city’s economic development. Berlin seems to have done too little to bring back the firms that had moved to West Germany in the 1950s. The collapse of the formally heavily subsidized economies in both East and West Berlin caused the loss of more than 250,000 jobs in traditional industrial sectors between 1991 and 2001. As a result, the city is among the country’s poorest regions today. Take it out of Germany and the country’s GDP rises by 0,2%, according to the Economist. The capital’s debt is enormous and it benefits greatly from budget surpluses of dynamic regions such as Bavaria under the fiscal equalization system. Attempts to merge both Berlin administrations led to significant dysfunctions. As a result, budget has been inefficiently managed and essential development projects for the city suffer from cost overruns and delays. The Berlin Brandenburg airport, initially due to open in 2011, will most probably be unfinished in 2021. Roadworks constantly block the streets and housing searchers cannot see the end of the tunnel as Berlin lacks 2 million affordable apartments according to recent studies.

The fall of the wall seems to be akin to an unexpected marketing event and the city is now a victim of its own success. In the context of the brutal changes in land use since 1989, its still low prices and easy life attract foreign and west German investors, leading to a 120% jump in property prices since 2004. To curb the rapid gentrification, historical inhabitants often opt for rebellion. But despite the government’s policy of protecting tenants, many residents of central districts such as Prenzlauerberg are forced to squat in their own districts before eventually being evicted.

Karl Scheffler made famous the intuition that “Berlin is a city condemned forever to becoming and never being.” It looks duplicated and unfinished by nature. Torn between a past-excluding, ever-changing identity and a desire to freeze its post-wall cultural scene, Berlin lacks direction in urban development and forgets the threat of resurgent inequalities in its city center. The old song lyric, “Berlin bleibt doch Berlin” (Berlin always remains Berlin) seem more acute than ever. The capital’s administration must return to the tradition of German efficiency to regain control of urban planning and protect its inhabitants. Above all, it needs to rethink its economically unsustainable development model beyond its ‘poor and sexy’ vitality. Only then will the authorities have the necessary means to soften homogenous commercialism and gentrification. That will be when Berliners can maintain their cherished balance between “Kiez” (neighborhood) and “Ku’damm” (the city’s main shopping street).

Franklin Lobry

Franklin is a third year European Studies student in a dual degree between SciencesPo and University College London, writing as a contributor for Sensus.

His particular interests of study and research include Sustainable development and European governance.