The German Inflation Trauma: Weimar’s Policy Lessons Between Persistence and Reconstruction

2.1.1 Persistence Thesis

According to the logic of persistence, the question of origin of a policy-specific reading of Weimar memories is trivial. The most obvious source of trauma, and hence its interconnected policy lessons, is the turbulent period of hyperinflation between the summer of 1922 and the fall of 1923. Following this logic, individuals who experienced hyperinflation and its disruptive social consequences first-hand not only sustained a deep psychological injury stemming from the loss of wealth, savings, increasing material uncertainty, moral decay, or political violence (e.g. Depkat 2007, 473). They also processed the event by developing a respective coping mechanism, drawing political lessons and developing a preference for stability-policy. This intuitive approach relates closely to a clinical definition of post-traumatic stress disorder (APA 2013) as well as to the sociological literature on historical trauma (Sotero 2006), and collective or social trauma (Hirschberger 2018; Saul 2014). This literature perceives the experience of a traumatic, incisive, far-reaching event as the origin and source of its traumatic effects – psychological distress on the one hand, coping patterns on the other which may then be transmitted to following generations through conversation and behavior (or even genetically).

Following persistence, today’s understanding of inflation trauma is a direct product of the collective first-hand experience that has been passed on intergenerationally and became entrenched in the collective memory of the event, thus persisting across time. This line of interpretation suggests there should be historical continuity in the characteristics of the trauma and little change in its phenomenology over time. The link between the memories of hyperinflation, the assumption of trauma, and the various policy preferences constitute a manifest and stable mental disposition.

The logic of persistence can be encountered ubiquitously in the recapitulation of the Weimar hyperinflation in the media (Jung 2009; Sinn in Häring et al. 2012; Eckert and Zschäpitz 2013; Kegel 2021), as well as in political debates (Kohl 1997; Schäuble 2010; Steinmeier 2020; Tietmeyer 1991a, 182; Tauber 2023). Prominently, given the anniversary of hyperinflation, it has been claimed that hyperinflation caused “a hundred years of inflation angst” (Kessler 2022) and that it has shaped the collective consciousness “until today” (Balzer 2021; Fuchs 2022; Dohmen 2023).

Furthermore, persistence is also prevalent in scholarly discussions. Paradigmatically, the German subtitle of Frederick Taylor’s (2013) seminal study on the “downfall of money” (ibid.) reads “birth of a trauma” (ibid.). Taylor directly connects traumatic Weimar memories with lasting policy preferences, arguing for a “lasting, almost obsessive memory of ruin that has persisted there (in Germany, our add.) ever since” (ibid., 343). Taylor is commendably explicit in his interpretation of how the trauma persisted over time. For him, it was the bourgeoisie who had been most affected by the events and whose thoughts he considers – probably rightfully – as “extremely important in the formation of public opinion” (ibid., 346). It was the collective memory of this particular group that became synonymous with German inflation trauma as we understand it today. Taylor even claims that “every educated family in Germany seemed (and even now seems still) to have a story of how the inflation had caused drastic forfeiture of status and wealth” (ibid., 347). These stories were not simply anecdotal, but in light of Weimar’s fate also “had taught Germans many hard lessons, and a key one had been that financial stability was vitally important.” (ibid., 356)

Few historical studies of German inflation that discuss the trauma are as precise in sketching the mechanism as Taylor. Yet many studies draw the same direct link between the German inflation and political lessons of financial stability. Stocker (2022) not only claims that, “the extreme fear of inflation that distinguishes Germans from most other nations to this day is rooted in the events of [the Weimar hyperinflation]” (ibid., 8), but also that “one of the most disastrous after-effects of the inflationary period was probably that an indissoluble link between national debt and hyperinflation was created in the minds of the Germans” (ibid., 331). Von Wallwitz (2021) similarly asserts that the experience that “the state became a counterfeiter of coins” (ibid., 287) emerged as a central element of Germany’s “financial memory” (ibid.) passed on from one generation to the next. This experience, he argues, determined a particular preference for fiscal discipline and the “commandment of central bank independence and the prohibition of monetary financing” (ibid., 297).

What seems to endow the persistence thesis with historical leverage are the fiscal and monetary policies adopted after hyperinflation. These include a strict intervention by the Reichsbank in 1927 to end what it considered excessive stock market speculation (Voth 2003) and the more prominent strict fiscal austerity (owing to inflationary fears) pursued by Reichskanzler Heinrich Brüning in the early 1930s (Borchardt 1980, 1985; Mee 2019, 52; von Kruedener 1989, 216; Wehler 1987, 249). However, this interpretation of Weimar stability-oriented fiscal policy and inflationary fears has long been questioned. Schiemann, for example, suggests that, during the days following hyperinflation, “the German people [had] less fear of inflation than is claimed” (Schiemann 1980, 225). Holtfrerich argues “that the fear of inflation was less widespread among the public than the statements of some politicians indicated” (Holtfrerich 1982, 626–627). And if Borchardt is correct in criticizing Weimar politicians for creating an expensive “Subventions-und Umverteilungsstaat” in the 1920s, preferences for financial stability cannot have been that widespread indeed (Borchardt 1980, 331; also see Ritschl 2002).

The Reichsbank policies after inflation do not unambiguously underscore persistence either: Throughout the 1920s, the Allies exerted control over the election of the Reichsbank president and members of the Directorate (Holtfrerich 1988, 118). During National Socialist rule monetary policy loosened considerably, with explicit support by German experts in monetary theory (Wagemann 1940). Moreover, independence of the Bank deutscher Länder and of the Bundesbank was the result of Allied planning and took place against “heavy resistance” of German politicians (Buchheim 2001, 2cf. Mee 2019, 95ff). Hence, from an economic history perspective, there is no clear evidence that traumatic inflationary fears dictated German monetary and fiscal policy consistently from 1924 onwards.

2.1.2 Reconstruction Thesis

According to the logic of reconstruction, today’s notion of inflation trauma is not a product of the initial traumatic experience but a post-hoc interpretation of the event. Rather than a manifest characteristic of trauma, the conflation between hyperinflation and stability policy prevalent in current discourse should be considered the product of collective sense-making processes, i.e. traumatic memories were retrospectively charged with the lessons of stability-oriented monetary and fiscal policy in order to assert particular political purposes. This deliberate conflation then superseded other interpretations and became engrained in the collective consciousness and its curation within the public arena.

This line of interpretation resonates with the sociological literature on cultural trauma (Alexander 2012; Eyerman 2022) which postulates that for collectively shared meaning of traumatic experiences to evolve, a process of hierarchical structuring and political meaning-making is necessary. This process may transpire years or decades after the event. As a “post-hoc reconstruction” (Alexander 2012, 13) it may articulate interpretations that are independent from the experience itself but dependent on the political purposes they serve. As further psychoanalytical studies have argued (Volkan 2001) later generations may even deliberately appropriate past trauma and charge them with present-day meaning to stabilize group identity and belonging in time. Resurfacing in economic narratives, such interpretations may then have profound economic effects though they are largely detached from the historical reference point (Shiller 2017, 2020).

Proponents of reconstruction differ in their assessment of how traumatizing the events of 1923 were for those individually affected. They share the view, however, that the notion of inflation trauma as historical experience interlinked with specific policy preferences constitutes a form of constructed reality. The experience of hyperinflation was deliberately charged with particular meaning, “implanted” (Hudson 2011) into public discourse years after the event and “artificially kept alive” (van der Vat 2014) to drive monetary and fiscal policy objectives.

Prominently, Mee (2019) argues that, due to heavy disagreement over Bundesbank policy, references to the Weimar hyperinflation served as a strategic instrument for the Bundesbank to establish and defend central independence in Germany following WWII. He concludes that, especially in the 1950s, an inflation narrative prevailed that had little to do with the historical event of inflation, but instead was politically motivated. This narrative, which is still effective today, not only emphasizes the need for an independent central bank, but also stresses the serious social consequences of inflation, which must be prevented by tight monetary policy. Mee goes as far as to claim that “[t]he preoccupation of Germany’s political culture with inflation today has little to do with the actual events of 1922–3; rather, we can find its roots in an institutional divide that the Allied military authorities had set in place in 1948” (ibid., 28; cf. Haffert 2023).

Mee’s reconstruction thesis is supported by a list of authors who have all highlighted the deliberate and strategic endeavors of the Bundesbank “to reinsert memories of the hyperinflation of the 1920s into Germany’s postwar political mythology” (Johnson 1998) and “to remind the German public continually of the cautionary lessons of the great inflation” (Marsh 1993, 18). There is no doubt the Bundesbank acted as an influential producer of public memory, consciously linking the inflationary past to its own stability-oriented efforts (Holtfrerich 2008; James 2005, 377–383; Kennedy 1991, 6–10; Löffler 2010; Lindenlaub 2010; Neyer and Stempel 2023). Beyond the focus on the Bundesbank, Rowley (1994, 174–179) mentions further political uses of the Weimar memory to argue against debt-driven Keynesian policies. For instance, in their 1980s electoral campaigning, the CDU printed then-chancellor Helmut Schmidt’s portrait on Weimar-style inflation money. Moreover, Schieritz (2013, 129–136) and Hirsch (2015, 56–57) further highlight the critical role of policy experts, mass media, and museums as curators of collective remembrance, keeping memories of hyperinflation alive, stirring public fears and demanding anti-inflation policies.

Howarth and Rommerskirchen (2013) provide one of the most direct challenges to the notion of a persistent policy-specific inflation trauma. Noting that there are indeed “deep-seated public preferences” (ibid., 766) regarding restrictive monetary and fiscal policy among society, they argue that the very term “stability culture” linked to hyperinflationary memories and stability policy, was deliberately constructed in the early 1990s. At that time, it was part of a reaction to the widespread opposition of the German population to the replacement of the Deutsche Mark (D-Mark) with the euro. Furthermore, the authors claim the CDU/CSU and FDP continued to use the historically-charged term during the Eurozone crisis to push for fiscal austerity.

2.3.1 Identifying “Trauma” in Historical Sources. General Approach

Given this theoretical approach regarding collective memory, we can operationalize the ways in which our two sets of sources connect to communicative and cultural memory and thus provide plausibility for either persistence or reconstruction. We first outline our general approach for identifying relevant aspects of German inflation trauma in historical sources over time. We then turn to a more specific methodological discussion in relation to our two different bodies of primary sources.

Following the logic of persistence, if a preference for stability-oriented policies was part and parcel of the historical trauma, it must be possible to detect this particular notion within the historical recollection of those who experienced hyperinflation as first-hand witnesses. In order to emerge as cultural memory these individual recollections need to display a certain degree of coherence at least within certain social groups. Likewise, the conflation of hyperinflation and stability-oriented policies should then emerge in a more or less stable and uniform pattern within institutionalized fora of public discourse – such as the German Bundestag.

Conversely, if German inflation trauma is the product of retrospective sense-making as proposed by the logic of reconstruction, the communicative memory of earlier generations should not systematically conflate memories of inflation with lessons of monetary and fiscal conservatism salient in today’s cultural memory. Rather, reconstruction theorists would expect memoirs to display a plurality of inflation stories and no clearly discernible historical ‘lesson’. Yet, within public discourse – here approached through Bundestag debates – it should be possible to make out a distinct phase or moment during which cultural memory was charged with such lessons of stability-oriented policy to then become entrenched in a shared and largely uncontested imagination of the past.

To control for the empirical validity of the two assumptions in a long-term historical perspective, we first examine personal memoirs of people who experienced hyperinflation in 1923 first-hand. While such memoirs are cases of written rather than oral transfer and pose issues of authenticity (see below), they constitute a particularly accessible kind of source, directly linking individual memories to communicative memory (cf. Figure 1). Published memoirs are thus not only examples of individual recollections of historical incidents, but their printed form highlights their intention of being shared among social groups and subsequent generations. Second, we examine plenary speeches made in the German Bundestag as an important institutionalized forum of public discourse. Given the political impact of the debates, the German parliament constitutes a pivotal arena for the curation of collective memory, particularly the deliberation of communicative memories and their transcendence into the cultural realm (cf. Figure 1). Also, parliamentary speeches are per definition directly related to policy making and thus particularly suited for the analysis of the relative stability regarding political implications connected to the notion of trauma. Policy-makers may, for example, allude to the psychologically stressful personal experience or the danger of inflation in collective memory to claim authority over a specific policy direction.

Figure 1:

Conceptual framework.

Figure 1 provides an overview of how our two sets of sources provide an empirical basis for assessing the possible links between the historical events of 1923 and the current cultural memory of German inflation trauma. A failure to reconstruct plausible links between individual memories, communicative memory and cultural memory, implies a rejection of the persistence thesis. It does not imply that individual memories were irrelevant for shaping cultural memory.

2.3.2 Memoirs

First, to examine stability of the Weimar memory within communicative memory, we employ historical source criticism to analyze the presence of (collective) trauma in a sample of published memoirs of men (mostly) and women who personally experienced the period of inflation. Our sources comprise 179 memoirs that were selected based on a comprehensive literature search. Specifically, we searched the Common Union Catalogue (GVK)^[2] that covers the holdings of all libraries of the Common Library Network (GBV) and the Library Network Southwest Germany (SWB) using the keyword ‘autobiography’ for all publications published between 1925 and 1985. While the starting point for the publication date is obvious, the year 1985 was chosen to keep the sample manageable and because the concept of communicative memory requires a direct link to personal experience. The initial search amounted to 1.810 primary sources.

From these, we selected all publications that fulfilled the criteria of being written for a German audience (i.e. in German language). Concerning the authors and their relation to German society, we opted for a pragmatic approach that includes Germans who later migrated as well as foreign-born authors who migrated to Germany as long as they made first-hand experiences in Germany during the early 1920s. Authors had to be at least 10 years of age in the year 1923. We also excluded memoirs whose authors were living abroad during the early 1920s if they made no reference to inflation.

As some published memoirs were not catalogued within the GVK as ‘autobiography’, we extended the list by systematically sifting publications that drew on Weimar autobiographies (cf. Danner 2024; Depkat 2007; Feldman 1997; Kremer 2017; Koza 1971; Taylor 2013) and by searching for those politicians who referred to hyperinflation in parliamentary speeches. While our sample is the largest of autobiographies relating to the early 1920s that we know of, it is neither complete nor representative of the German population. Obviously, there is also an immense gender-historical disproportion as only 22 of the 179 memoirs considered were written by women. Given the size of the sample, important questions of source-criticism such as the addressees of the texts or the reliability of the author’s information cannot be adequately addressed (see Aurell 2006; Danner 2024; Depkat 2007). Our criteria of publication through a publisher means that the addressees were essentially anonymous. Some authors probably wrote their memoirs with a specific audience in mind, but we also included memoirs published posthumously unless the writer had explicitly intended to keep the memories unpublished. While historians have traditionally considered autobiographies as unreliable sources, more recent research has highlighted their usefulness in light of suitable research questions (Aurell 2006; Brechtken 2005; Depkat 2004; Kremer 2017: 24).

Our sample contains memoirs with greatly different degrees of authenticity, function, motivation and addresses. Some memoirs were written for a large audience with the aim of exculpation, for example Albert Speer or Heinrich Brüning (Brechtken 2017; Morsey 1975); others were written with no clear strategy of publication and the plausible aim of personal affirmation. Some writers intended to illuminate blind spots of German history while others made a political argument. References to inflation could have the function of highlighting personal economic difficulties relevant for later developments (Kremer 2017, 266); they could function as a political ‘lesson’, or they could just be considered a relevant part of one´s life with no specific function attached.

Memoirs cannot fully replace access to oral inter-generational communication crucial for the assumption of persistence. There is also the problem of time and temporal inconsistency. As historical memory results from a retrospective sequencing of earlier and later events and experiences rather than an isolated instance (Depkat 2007: 509), the timing of publication could be an influential factor given discursive or political context (Sabrow 2012). However, we do not expect someone to tell anecdotes to grandchildren that are inconsistent with what that person would write in an autobiography as both narratives will relate to that person’s “autobiographical whole” (Depkat 2007, 509). Furthermore, in light of the logic of persistence, the timing of one’s published memoir should play a minor role, assuming an overall uniformity of recollection. Therefore, we do not consider these limitations as serious flaws because they do not stand in the way of reaching a plausible conclusion in favor of either persistence or reconstruction. The same applies for the more serious problem of the fact that most memoirs have been written by propertied authors with a bourgeois background that were affected differently by the inflation than workers. This bias in public memory has been identified by historians as a crucial driver for the specific development of German inflation trauma (Taylor 2013, 346; Wehler 1987, 249). However, while this bias obstructs reaching a generalization with regards to German population as a whole, it still allows for an analysis of different views held within bourgeois circles. Moreover, the sample does contain a significant number of memoirs by people with a working-class background (e.g. Adelung 1952; Buchwitz 1976; Fabian 1981; Hertrampf 1984; Liebermann 1977). In general, for this paper, we assume that if the kind of stories assumed by persistence were widespread they should also find a proper resemblance in published memoirs. If authors ignore the inflation of 1923, if they discuss it as a secondary aspect of minor importance, or if they do not refer to it in any negative way, we take this as a proxy that speaks against the persistence thesis.

To understand the process through which historical memory may have generated lessons and preferences in regard to stability-policy, it is necessary to understand how people individually made sense of their inflation experiences. Our approach to historical source analysis enables us to inductively find patterns of explanation and interpretation vis-à-vis hyperinflation rather than working with (modern) preconceived notions that may be ill-suited to capture the spectrum of interpretations in the past. Thus, we are able to control not only for manifest patterns of interpretation which we would expect given today’s cultural memory but individual aspects of narratives that grandparents and parents may have passed on to their descendants as communicative memory.^[3] Finally, our historical analysis enables us to assess how the authors of the memoirs considered their own relation to public memory, i.e. whether they thought that the public would largely share their interpretation of 1923 (persistence thesis) or whether they wanted to bring back a historical event to public consciousness that they considered largely forgotten (reconstruction thesis).

2.3.3 Parliamentary Speeches

Second, to examine the link between communicative and cultural memory, we examine all speeches held in the parliamentary debates from 1949 until 2022. Specifically, we employ a qualitative content analysis (Mayring and Fenzl 2019) to control for the policy-specific interpretative context, temporal dynamics, and party-specific volume of speeches referring to the Weimar hyperinflation held in the German Bundestag.

To do so, all relevant plenary speeches alluding to the Weimar hyperinflation were identified with the help of the Bundestag’s digital archive DIP,^[4] employing the terms ‘Inflation,’ ‘Währungsstabilität,’ ‘Währungsreform,’ ‘Währungsschnitt,’ ‘Währungsverfall,’ ‘Geldwertstabilität,’ ‘Geldentwertung,’ ‘Zwanziger,’ ‘20er,’ and ‘1923’ in a full-text search. This preselection was followed by a subsequent manual sifting for pertinent references alluding to the Weimar memory. Both direct references to the 1923 hyperinflation and indirect allusions (e.g. to ‘our historical experience with inflation’) were considered for further analysis. For each relevant speech, we noted the date and party affiliation of the speaker. Then, we qualitatively scrutinized whether and which policy proposals and political lessons were semantically tied to the memory of hyperinflation.

Following our research question, we distinguished between semantic links that support the notion of German inflation trauma as discussed above and semantic links that do not support this notion. As stability-oriented policies can have a monetary and a fiscal dimension (or both) we introduced two variables in support of a close link between German inflation trauma and stability-oriented policies:

1. Stability-oriented monetary policy – operationalized as proposals or affirmative statements towards price stability as primary objective of central banking and the rejection of monetary financing tied to the institutional guarantee of political independence,

2. Budgetary discipline – operationalized as proposals or affirmative statements towards a restrictive approach to public spending, fiscal austerity, and low levels of public deficits and debt.

   We included both speeches which directly linked hyperinflation to such policy proposals, as well as those which mention this perspective as a valid argument for avoiding hyperinflation, yet argue for alternative policy.

   In order to capture alternative policy proposals or political lessons in relation to German hyperinflation, we also controlled for semantic links between hyperinflation and expansive monetary or fiscal policies:

3. Growth-oriented monetary policy – operationalized as proposals or affirmative statements for a central bank mandate that next to price stability also or primarily focusses on achieving economic growth and employment allowing for debt monetization and/or forgoing the institutional guarantee of central bank independence;

4. (Increased) public spending – operationalized as proposals or affirmative statements of increasing fiscal expenditure and the expansion of support payments and benefits schemes.^[5]

Again, we not only included speeches which make specific policy propositions, but also those that support the argument of expansive policies as a consequence of hyperinflation.

The two different sets of policy proposals are neither logically nor politically conflicting. Contrasting them in this way makes only sense in light of the contemporary understanding of German inflation trauma and the widely held view of a persistent and close link between the historical event and stability-oriented policy preferences. Our two sets of alternative variables allow us to analyze the specific semantic links between hyperinflation and policy proposals as a process rather than as a given. To do so, we quantitatively examined the occurrence of the conflation between hyperinflation and these four variables over time, and qualitatively scrutinized their occurrence within relevant debates. For the period between 1949 and 2022, we controlled for the consistency of policy propositions or political lessons linked to the memory of hyperinflation made by Bundestag members.

3.1.1 The Personal Impact of Hyperinflation

Historians who retrospectively sought to grasp the creation of an inflation trauma during the hyperinflationary period have assumed a uniform picture: The drastic consequences of financial turbulence, expropriation and political violence produced a traumatic experience of exceptional importance for those involved (Pierenkemper 1998; von Kruedener 1989). A collective biographical study published in the early 2000s found that the interviewees generally recalled the economic hardship of the hyperinflation “as more devastating” than even the Great Depression “because of its impact on their parents and family” (Kohut 2003, 258; 2012).

The memoirs considered in our sample largely support the finding of an economically difficult and psychologically stressful time. Authors speak of the early 1920s as “ominous” (Dohrn 1991, 44) or “sorrowful” (Buchheim et al. 1996, 106); they invoke “madness” (Buck 1948, 116) and “moral decay” (ibid., 136); they emphasize of a “mass deception” (Hirschberg 1998) with “serious consequences” (ibid.) and they view inflation in retrospect as a “memory of horror” (Neumann 2013, 357) or a “hell” (Luther 1960, 175). Such descriptions are partly attributions to their personal life, partly attributions to German society as a whole, or something in between. Although no source mentions the term ‘trauma’ verbatim, such descriptions constitute valid descriptions of traumatic experiences.

The totality of hyperinflation permeated everyday life and created serious economic hardship. For instance, many memoirs connect inflation to a period of hunger (e.g. Hertrampf 1984; Knuth 1974; Reiners 1982), economic uncertainty (Benjamin 1928; Berger 1953, 188f.; Canetti 1980, 62) and unemployment (e.g. Fabian 1981, 77; Pilz-Schottelius 1982, 76). At the same time, inflation did not impose itself on people in the same way. Erna von Pustau, a young bourgeois girl in the early 1920s, suggests that for her mother Erna´s fashionable haircut was more noteworthy than the murder of Walther Rathenau (Buck 1948, 192). Elisabeth von Werthern, a Prussian aristocrat, recalls the “Quäkerspeisung” (Werthern 1985, 68f.) at her school during which she received a sweet soup of cocoa every long break. Journalist Vilma Sturm, also a young girl in the 1920s, admits ignorance with regards to the inflation’s “economic, political, and psychological effects” (Sturm 1981, 57). In her memory, the event is “actually a kind of joke (Jux)” (ibid.). Even the connection between inflation and economic hardship could be questioned in hindsight. Willy Hellpach, a jurist’s son, claims that the “grey misery” (Hellpach 1949, 126) of 1923 had less to do with inflation itself, but rather with the harsh stabilization policies of the currency reform that left many state bureaucrats unemployed. For years, Hellpach claims, he kept meeting people who would curse the reformers Luther and Schacht who in public memory were later celebrated for ending inflation (cf. Teupe 2022, 245f.).

Overall, however, one striking finding is the limited role of German hyperinflation in a great number of memoirs. Few publications devote more than a single paragraph to the event. In 80 of 179 sources, i.e. in ca. 45 %, the inflation of 1923 is mentioned in little more than passing or not at all. Discussing the German inflation in less than two sentences seems little within the context of autobiographies usually covering more than 200 pages (see list in Appendix A). Even the complete lack of discussing German hyperinflation is widespread, irrespective of the date of publication (e.g. Benn 1984; Domin 1982; Ehre 1985; Frey 1978; Minetti 1985; Reiners 1982; Rühmann 1985; Willms 1985). In many cases, the lack of references to inflation simply reflects a decision to focus on private living worlds – marriages and romances, personal losses, travel experiences, professional achievements, et cetera. Such episodes of life the memoirists obviously considered, at least retrospectively, untouched by the monetary decay. However, other memoirs in which hyperinflation is largely absent are noteworthy. If the authors played either a political role (Jäckh 1960; Merton 1955; Schiffer 1951), explicitly tried to give an explanation for the rise of Hitler (Victor 1982, 97), or discussed other historical events in great detail, such as WWI (Hoffmann 1970; Salander 1977), Putsch attempts (Manstein 1958; Brundert 1965), or the Great Depression (Brauchitsch 1964; Schlange-Schöningen 1946; Willms 1985, 194), an explanation centering on detached private living worlds would be feeble. Yet whether the commemorative void of hyperinflation in these cases is intentional or whether it reflects memory loss, we are unable to answer. In both cases, however, it does not support the logic of persistence.

Some contemporaries, mostly younger people at the time, later considered the period of hyperinflation even a positive episode in their life. In a biographical interview, a Mr. Flebbe called those days the “happiest of his life” (Heisterhagen and Hoffmann 2003, 151). Hans Schlange-Schöningen, a liberal-conservative politician of the Deutschationale Partei considered it “the best and most hopeful time of my life” (Schlange-Schöningen 1946, 22). Günther Willms, a jurist, writes of a carefree childhood in the early 1920s, without mentioning hyperinflation (Willms 1985). Paul Bonatz, an architect who was able to build his home “for free” (Bonatz 1950, 111) remembers it - in stark contrast to the war experience - as the “most flourishing time” (ibid: 106). The worker Mischket Liebermann who owed her company 1.000 Marks was “rescued” (Liebermann 1977, 55) like other debtors by monetary devaluation. Albert Speer could live a comfortable life thanks to allowances in foreign currency (Speer 1969, 26). Although these instances of a positive recollection are an exception, remembrance of the personal impact hyperinflation on the personal lives of first-hand witnesses is overall far from uniform. While there is support for a highly negative, potentially traumatic impact of hyperinflation, the importance memoirists in our sample attach to the event is not as decisive as claimed by supporters of persistence. Widely cited autobiographies such as those by Haffner (2014), Canetti (1980), or Zweig (1941) claiming that inflation had grave social effects that i.e. predetermined the rise of the Nazis are hardly representative within the context of our sample.

3.1.2 Making Sense of German Hyperinflation and Its Causes

The concept of persistence requires a direct link between personal experiences and political ‘lessons’ of stability policy. Thus, the concept suggests that those who experienced hyperinflation interpreted it as an event resulting from either monetary or fiscal laxity. However, most memoirs (ca. 70 %) do not discuss causes of inflation (see Appendix A), even if their authors engage in detail with its personal and economic effects as well as their personal dealings with them (Berger 1953, 188f.; Boveri 1978, 115ff.). Also, the few memoirs that – either directly or indirectly – do point out reasons for inflation do not paint a clear, uniform picture. Rather, we identified seven different causes for inflation that the memoirs mention.

First, some memoirs mention WWI in direct connection to post-war inflation (Dietrich 1951, 18; Eberle 1982; Hirschberg 1998, 188; Kaisen 1967, 103; Marcuse 1960, 75), but in doing so point to more general economic effects of impoverishment rather than budgetary problems. Second, many sources from a worker or socialist background point to the big industrialists or “monopolies” (Braun 1949; Helm 1978, 64), the banks or simply the “ruling class” (Seydewitz 1978, 90). German writer Heinrich Mann, for instance, highlights the central role of prominent industrialist Hugo Stinnes without whom the inflation could have been ended “at any time” (Buchwitz 1976, 375; Mann 1979, 322; also Hallgarten 1969). In memoirs published in the GDR, this was an unsurprisingly prominent interpretation, but it was also present in the FRG. The big industrialists and the banks had, as one West-German author remarked “tried to unilaterally shift the burden of the consequences of the war onto the workforce and other working classes by constantly raising prices” (Fricke 1981, 15). This picture of causal interpretation is also in line with an observation that Ludwig von Mises made at the height of the Great Depression. For Mises, hyperinflation was the consequence of fiscal and monetary laxity. Yet in 1932 he criticized Germans for having learned nothing from the experience. “For the German public mind” (Mises 1932: 232), Mises lamented, “every misfortune is due to the machinations of the ‘exploiter class’” (ibid.).Mises was wrong, however, to think that the German public mind was narrowly focused on the ‘exploiter class’. Unique historical events like, third, the Ruhr Occupation (Adelung 1952: 261; Bräutigam 1968: 115; Helf 1977: 359; Severing 1950: 454) or, fourth, the murder of Walther Rathenau (Brecht 1966, 397; Hellpach 1949, 126; Redslob 1972, 195) are also mentioned as central drivers of inflation in memoirs.

Another widely assumed root cause was, fifth, the reparation demands by the Allies (e.g. Fürstenberg 1965; Schacht 1953 and 209; Schmidt-Hannover 1959; Schwerin von Krosigk 1977; Wagemann 1940). This view was the ‘official’ theory of German politicians and the Reichsbank. It was supported by most newspapers. Even the president of the Bank deutscher Länder and, later, the Deutsche Bundesbank, Wilhelm Vocke, traced the inflation to the “short-sighted” (Vocke 1973: 78) and “fateful” (ibid.) reparation demands. Unlike the other causes, reparations could provide a potential link to the role of budgetary deficits as the Reichsbank had to monetize the debt which the German government was unable to pay. It should be noted, however, that most memoirists considered reparations a historical anomaly, often linked to French animosity and the anti-German French Prime Minister Poincaré (Neumann 1978, 61). They did not refer to reparations with the intention of drawing general lessons with regards to budget deficits. Rather, - if discussed at all - the effects of reparations were expected to show in the exchange rate rather than in state budgets or the quantity of money (Hoegner 1958, 93).

Only a small minority of memoirs considers, sixth, fiscal imbalances to be the most relevant source of the issue. One of the clearest such examples in favor of persistence is Marie-Elisabeth Lüders, a member of the FDP, who argues in her autobiography:

“From 1921 to 1923 it was still impossible to draw up and balance a proper budget, so that the printing press had to help out and the value of money sank ever lower […] All former concepts of financial order, control and thrift collapsed. In the general confusion of inflation all former standards sank.” (Lüders 1963, 81).

Another case, historically more prominent, is that of Heinrich Brüning. In his memoirs, published in defense of his role during the devastating Great Depression (Morsey 1975), Brüning considers tax increases as the only viable way of fighting hyperinflation (Brüning 1970, 83ff.). Others argue at least indirectly for the central role of state budgets. Leo Lippmann, a Hamburg State Council in charge of finances, mentions the disparity between state revenues and spending (Lippmann 1964, 312) while also highlighting inflation’s positive aspects of low unemployment and rapid economic reconstruction. Gustav Noske refers to the moment when the Reich, the states and the municipalities must try “at all costs not to spend more money than is taken in” which had shown “how poor Germany and the masses of its people” had really become (Noske 1947, 261; see also Schwerin von Krosigk 1974, 30). The Social Democrat Wilhelm Keil is a particularly noteworthy case showing that one could draw different political lessons from the link between a budget deficit and inflation. Keil was himself involved in tax policy? during the early 1920s and an opponent of Karl Helfferich. His interpretation is in line with persistence, arguing that it was the budget deficit that had caused the printing press to take up speed (Keil 1947, 227). However, Keil’s ‘lesson’ is not to balance the budget by cutting expenses but by increasing taxes which the bourgeois interests had prevented in the 1920s.

A lax monetary policy is the seventh cause of inflation. Yet hardly any memoir considers monetary policy as an explicit cause, and most even fail to mention the Reichsbank (for exceptions, see Bonn 1953, 270ff; Fürstenberg 1965, 166; Heuss 1964, 116; Schacht 1953 and 206ff.; Staudinger 1982, 24ff.). Next to monetary economist Albert Hahn (1963), banker Erwin Hielscher (1968) and economic journalist Volkmar Muthesius (1973), Georg Borttscheller (1973), a German politician of the FDP, is the only one in the sample who interprets German hyperinflation exclusively as the direct result of monetary policy and the circulation of money. This interpretation was in line with the quantity theory that – strinkingly – many Germans had rejected in the 1920s (cf. ibid., 81) and to which Hahn (cf. 1963: 7ff.) only converted late in the inflation. For Hielscher and Muthesius, who in the 1950s had campaigned for Bundesbank independence (Mee 2019, 92) the lesson was clear and in line with German inflation trauma. However, despite his similar interpretation Borttscheller did not turn into a ‘hawk’. Rather, he held the Keynesian view that the Great Depression eight years later should have been countered by “cheap money” (ibid.) and “creation of credit” (ibid.) without fearing its potentially inflationary effects.

It should also be noted that even if a specific cause for inflation was mentioned, most authors did not necessarily consider it exclusive. Economist Moritz Julius Bonn, for example, criticizes Reichsbank president Havenstein as much as industrialist Hugo Stinnes as being responsible for inflation (Bonn 1953). Paul Löbe, SPD member and president of the Reichstag between 1920 and 1924, in his memoirs offers the most extensive list of explicit causes:

“The expenses of the war, the import of foodstuffs after the hunger blockade, the delivery of reparations, the occupation of the Ruhr, the gaps in the German customs borders, the passive resistance in the coalfields caused the value of the mark to plummet. This forced the central bank to print banknotes with almost astronomical denominations.” (Löbe 1949, 95)

This complex and historically contingent interpretation certainly provided a foundation from which German inflation trauma linking inflation to debt could emerge. Yet given the plurality of experiences and causal interpretations it is doubtful if a coherent narrative of hyperinflation could have constituted the essence of a collective inflation memory in the 1950s or 1960s. Interpretation was still a far cry from the narrower ‘lesson’ of inflation trauma as we understand it today.

3.1.3 The Problem of Time: Remembering and Forgetting

Applying the concept of communicative and cultural memory suggests that the recollection of the personal historical inflation experience is handed down from one generation to another and finally became codified collective knowledge. This is suggested, for example, when Staudinger writes in his memoir that the experience of inflation became “an incubus of German economic policy for years, decades even” (Staudinger 1982, 25). However, within our sample this widely held view of supporters of persistence is an exception. Rather, judging from personal memoirs published 40–50 years after the event, the passing on of communicative memory from one generation to the next seems to have faced great difficulties. Having talked to many people as a public figure, former finance minister Hans Luther complained in 1960 that most of his contemporaries had “no clue of the hell that existed in Germany back then” (Luther 1960, 175). Erwin Hielscher, a civil servant and financial journalist, shared a similar view eight years later: there were “very few people [in 1968] who had a clear memory of the first inflation” (Hielscher 1968, 9). Thus, he cautioned that when the Bundesbank assumed that inflation fears were widespread, it was “unfortunately” (ibid.) mistaken. Like Luther, Hielscher was skeptical of the intergenerational transmission of fear and trauma. From a different perspective this view is supported by the memoir of Arthur Hübscher (1983), a philosopher, who contrasts his own negative experiences with a public image in which the 1920s were arguably presented as “the happy and good times” (ibid., 35).

Other memoirists did not consider an event like hyperinflation to be communicable in the first place as “[a]nyone who has not been through this cannot even imagine this difficult time” (Wiechering and Wiechering 1984, 110), the farmer Sophie Wiechering remarks many decades after the event see also Wissell 1983: 169). For some, inflation had faded in memory as early as 1925 (Baur 1985, 45), while others, such as writerLeo Weismantel in 1936 complained that “no one wanted to hear about the time that lies behind us” (Weismantel 1936, 29).

The historian Adam Fergusson shares this view. In the mid-1970s he published a bestselling book on the German hyperinflation, which serves as a popular reference regarding the ‘lessons’ of inflation. Fergusson maintains that, “the agony of inflation, however prolonged, is perhaps somewhat similar to acute pain – totally absorbing, demanding complete attention while it lasts; forgotten or ignorable when it has gone, whatever mental or physical scars it may leave behind” (Fergusson 1975, i–ii).

By the 1970s communicative memory had not established a persistent pattern of uniform inflation trauma. Memory of the event seemed to be fading, and interpretations were diverse. Given their assessment or even complaint of only an insignificant recollection of 1923 among society, the examples of Hielscher, and Fergusson do not fall into the realm of communicative memory. Their work has to be considered a contribution to cultural memory. By invoking a re-memorialization, they actively reconstructed the event in the view of concurrent debates over inflationary trends in the 1960s and 70s in Germany and worldwide. In this context, political debate played a crucial role in creating the type of inflation trauma we know today.

3.2.1 Stability-Oriented or Growth-Oriented Monetary Policy?

Monitoring the salience of stability-oriented monetary policy over time confirms its relatively tenuous significance to the overall remembrance of hyperinflation but underline the linkage between memory and monetary policy in particular debates. Specifically, the variable occurred frequently before the introduction of the Bundesbank Law in 1957, the early 1970s and the debates on global inflation following tensions as well as the subsequent end of the Bretton Woods system, the late 1980s until 2000s in the debates on European monetary integration and the inception of the Eurozone, and the height of the Eurozone crisis in 2011 and 2012. Within those debates, especially CDU/CSU and FDP members invoked the experience of hyperinflation to argue for monetary policy to concentrate on price stability.

As demonstrative examples, in 1950, Economy Minister and later Chancellor Ludwig Erhard (CDU) cautioned that “history has shown time and time again where open and price-capped inflation leads to”^[6] when arguing that “the best that we have achieved in Germany is that through an honest and clean monetary and credit policy […] we rekindled trust in our economy and our currency”.^[7] Likewise, in 1953, FDP representative and later Minister for Housing Victor-Emanuel Preusker argued for the guarantee of price stability and political independence to be introduced as “these questions are so weighty, especially after two inflations”.^[8] Then, in 1970, Finance Minister Axel Möller (SPD) admonished to “remember […] the two inflations after the great wars”^[9] canvassing for support for the “dampening measures”^[10] employed by the Bundesbank. Furthermore, in 1973, as the overall debate concentrated macroeconomic policy and not domestic monetary policy, FDP board member and later Finance Minister Otto Graf Lambsdorff cautioned to build on the “inflationary fears which due to historical experience have always been ample among our people and our country”^[11] when arguing for anti-inflationary policy, especially “a tough credit policy of the German Bundesbank”.^[12]

Most prominently, however, the semantic link to stability-oriented monetary policy characterized the debates on monetary integration as especially German chancellor Helmut Kohl (CDU) and Finance Minister Theo Waigel (CSU) again and again invoked the memories of hyperinflation when explaining the reluctance of the German population to give of their national currency. To guarantee that the Euro would be “as stable”^[13] as the D-Mark, they argued, the ECB needed to be sculpted after the Bundesbank model and its primary mandate of price stability. Doing so, they were supported by the governing coalition of CDU/CSU and FDP but also the opposition leading SPD who adopted a similar rhetoric in their speeches.

Subsequently, the Weimar memory re-surfaced prominently during the Eurozone crisis as FDP chairman and former Economy Minister Rainer Brüderle repeatedly introduced the experience of Weimar “every German family […] recounts”^[14] when arguing to defend the ECB’s commitment to price stability and repudiating the proposal of “firing up the printing press”.^[15] And following the crisis, the CDU/CSU continued to allude to the memory of the 1920s when admonishing to preserve the ECB’s mandate.^[16]

Conversely, the counter perspective growth-oriented monetary policy could not be detected within the speeches mentioning memories and experiences of hyperinflation.

3.2.2 Budget Discipline or Public Spending?

The temporal occurrence of today’s prevalent reading of budget discipline in relation to German hyperinflation and the contrasting logic of public spending further underlines the lack of uniformity in collective remembrance. Tracing both over time, reveals a conspicuous shift among both perspectives. While public spending was the dominant semantic pattern until the mid-1960s, neither perspective gained comprehensive authority until the early 1990s. Following a phase of conspicuous interpretative ambiguity during the 1970s and 1980s, only from then on, the lesson of budget discipline emerged as the defining interpretation of lessons from the Weimar hyperinflation.

Delving deeper into the debates gives further clarity to this statistical finding. In the first 15 years following the re-establishment of the German parliament, Bundestag members from all parliamentary groups, but especially the government-leading CDU/CSU, invoked the Weimar hyperinflation and its consequences as a factor that called for larger role of the state, an expansion of public services, and an extension of support payments. In this perspective, the Weimar memory did not teach the lesson of potentially inflationary state expenditures. Rather, in a historical context in which many Germans had themselves lost their savings due to two hyperinflations, speeches regularly underscored these effects of hyperinflation as a vindication for necessary public spending.

The large-scale devaluation of savings served as a justification to reform the public pension system and extend support to farmers, self-employed, former military and other groups who lost their assets due to inflation.^[17] As prominent examples, in 1954, Labor Minister Anton Storch (CDU) argued for a respective reform “to bring those things that have been dictated to us by two world wars and two inflations into a just order”.^[18] Likewise, Economy Minister Ludwig Erhard (CDU) in 1955 cautioned to defend people’s livelihoods against the threat “to be betrayed and deceived [again]”^[19] by keeping prices stable but also giving pensioners and recipients of social support “better and better coverage”.^[20] And Agriculture Minister and later Federal President Heinrich Lübke (CDU) called to support farmers who “experienced the two inflations and want to keep their purse at hand”^[21] in their transition into retirement. Next to social support, the consequences of hyperinflation were invoked by the CDU/CSU government to support public railway system,^[22] the domestic economy of Berlin,^[23] and invest in education and science.^[24] Beyond, Bundestag members mentioned the effects of hyperinflation when debating the need to support the capital market and German businesses,^[25] fund the revaluation of savings,^[26] to subsidize food,^[27] increase wages,^[28] foster youth welfare,^[29] extend credit to students,^[30] support rents^[31] or increase overall public investment.^[32] While in this process, the demand to increase public spending was not always supported by all Bundestag members, the general perspective that hyperinflation created a need among the public that begged attention was seldomly contested.

In contrast, during such first fifteen years, only few speeches linked hyperinflation budget discipline, e.g. to counter calls against potentially inflationary military armament,^[33] increased pensions and wages,^[34] reparations,^[35] economic stimulus,^[36] or other budgetary matters.^[37] Yet, especially prominent government members grounded such demand in the memory of hyperinflation. Prominently, in 1950, Finance Minister and self-proclaimed “guardian of the currency” (Strobel 1957) Fritz Schäffer (CSU) argued against any budgetary maneuvers “which could cast the German people who twice lost all their savings into the abyss of inflation”.^[38] He reasoned, a balanced budget would be necessary not to unsettle those “who due to these two events lost trust in the state and its financial affairs”.^[39] Likewise, Ludwig Erhard (CDU) – who would later declare price stability the basis for his social market economy and demand “to publicly brand” (Erhard 1964: 259) any inflationary behavior – argued to “soothe the German people”^[40] ensuring that the government would not use methods “that once again, first invisibly and then visibly, take money out of our people’s pockets”.^[41] Similarly, in 1954, Housing Minister Preusker (CSU) cautioned that a deficit-financed stimulus “must be avoided at all costs […] following two periods of inflation”,^[42] while Finance Minister Franz Etzel (CDU) admonished “a third inflation”^[43] when arguing against wage increases in 1960.

From the mid-1960s until the late 1970s, while the call for public spending largely disappeared from the debates, the conflation between budget discipline and hyperinflation then began to rise in salience. During this time, however, it still failed to dominate the overall remembrance of Weimar as less than half of all relevant speeches connected hyperinflation to fiscal restraint and – strikingly – a sizeable number of speeches made by all party groups focused on the political responsibility for hyperinflation or denied any historical analogies without debating its budgetary implications.

During this period, especially then CDU/CSU who led the government until 1969, referred to the experience of hyperinflation when demanding stability-oriented fiscal policy, cautioning against fiscal expansion as “the road to inflation”^[44] and the use of the “psychologically dangerous”^[45] technical term ‘inflation’ to describe the macroeconomic situation. According to the CDU, honoring “the special experience”^[46] of the German people, meant not to “mix up the priorities”^[47] but to give price stability supreme precedence in financial matters. As a vivid example, in 1966, budgetary committee member Wilhelm Brese warned against the possibly inflationary reconstruction of the Reichstag as “to do everything we can to keep our currency stable”^[48] given that Germany is “burned” .^[49] Likewise, Chancellor Kurt-Georg Kiesinger (CDU) cautioned to address “the trauma of inflation and the trauma of deflation”^[50] and balance investments with budget discipline. When in opposition, the CDU from 1969 on continuously followed the same argumentative pattern. Most prominently, former Finance Minister and CSU chair Franz-Josef Strauβ invoked the experience of “my generation”^[51] to substantiate “a concern among the whole people”^[52] over monetary instability. According to Strauβ, the “inflationary expansion”^[53] of the national budget by the SPD needed to be considered as an important, if not “primary source of inflation”.^[54]

Contemporaneously, the SPD – both when in opposition and in government – warned not only of “demagogically exploiting the anguish of inflation”^[55] and “rekindling hidden fears”^[56] by using the very term ‘inflation’ to describe the situation which had “nothing to do with inflation in that sense the German citizen understood during the twenties”^[57] given that “our people have become sensitive to such turn of phrase”.^[58] In contrast to the CDU/CSU, the SPD agreed on the general agenda to cut spending, yet defended their budgetary proposals as sufficiently restrictive and thus not overly inflationary. Prominently, Alex Möller, as SPD group deputy and Finance Minister, admonished “the inflations that befell our nation”^[59] were caused not by social democratic spending but “political forces […] which are more closely related to [the CDU/CSU]”^[60] to avert their accusation to impel inflation. Moreover, Chancellor Willy Brandt openly rejected short-term fiscal influence on the currency as there would be “no proof that the cancellation of a few billion […] has miraculous effects on the current economic and price policy developments”.^[61] Likewise, other SPD representatives underscored the “textbook policy”^[62] would not fit the situation and inflation was not “home-made”.^[63]

Meanwhile, the FDP both when in government in 1966 and in opposition in 1968 warned of a “third inflation”^[64] calling to keep public expenses in check. Then, during the socio-liberal coalition from 1969 onwards, FDP representatives joined forces with the SPD agreeing on the need to curb spending yet warning of “hectic propaganda”^[65] drawing on “the trauma regarding inflationary developments”.^[66] Prominently, Foreign Minister Hans-Dietrich Genscher warned of that “one can also speak inflation into existence”.^[67] Given such disposition, the FDP agreed to tackle “problems and risks”^[68] in their budgetary planning. At large, however, the party also repudiated a “home-made inflation”,^[69] reasoned that “it’s 1971 and not 1923 or 1948”^[70] and emphasized the “limited possibilities of budgetary policy”^[71] to influence prices. However, from the mid-1970s onwards, the FDP returned to their traditional interpretation linking the memory of hyperinflation and budget discipline, especially when demanding to prioritize stability-oriented economic policy among the European Economic Community. Doing so, Genscher emphasized that “Germany is a burned child”^[72] and thus recovering stability was of utmost importance, while Finance Minister Lambsdorff proposed that Germany was “lucky”^[73] to have had two inflations, but its neighbours and partnering countries needed to catch up and contribute to a harmonization of e public finances.

From the late-1970s to the mid-1980s, the collective memory of Weimar continued to be linked to budget discipline, primarily by members of the government. Particularly, in 1979, Lambsdorff claimed to follow “the wishes of a majority of our people”^[74] given their historical experience and curb net deficits. Following renewed warnings of a looming currency reform made by the CDU/CSU,^[75] Finance Minister Dieter Posser (SPD) rebuffed “talk of a third inflation”^[76] and proposed to forgo increases of public wages to get it “off the table”.^[77] Likewise, his successor Gerhard Stoltenberg (CDU) repeatedly reasoned to balance monetary and fiscal policy to prevent inflationary pressures warning against “the experiences of the past”,^[78] while Economy Minister Martin Bangemann (FDP) demanded fiscal consolidation “even if it hurts”^[79] given that “we live in a country that already twice has experienced galloping inflation”.^[80]

Conspicuously, from the mid-1980s onwards, the collective memory of hyperinflation was then again linked to public spending. Particularly, both calls for spending and discipline were combined by Labour Minister Norbert Blüm (CDU) in his several speeches on pensions and statutory support payments: Following a two-sided approach, Blüm, on the one hand, argued to increase pensions for the “children of the great inflation”,^[81] for those “who as a child experienced the sinister times, when the Mark was worth nothing, when workers earned millions”^[82] and one only “got two bread rolls for a bag of money”.^[83] On the other, he reasoned that this generation knew best to appreciate price stability as “the biggest accomplishment especially for pensioners, especially for employees”^[84] and as a “politics for the little people”.^[85] Hence, in order for pensions to remain their value they had to be limited and could not be financed through the potentially inflationary “political trickery of spending more than one has”.^[86] To give his argument further authority, Blüm repeatedly invoked the life-story of his grandfather “who drove home his wage in a handcart”^[87] and that of his mother “who was shaken by many an inflation [and] currency reform”^[88] and had always opted for a small but stable pension. Beyond, the policy recommendation to exert budget discipline to curb inflation, however, was drawn entirely by Blüm who perspicuously did not allude to any inherited policy lessons. Instead, it was Norbert Blüm who – sharing no personal experience of hyperinflation – juxtaposed both perspectives of budget discpline and fiscal spending drawn by first-hand witnesses and opted to reconstruct the memory of Weimar as a justification to limit public expenditure and borrowing. Interestingly, while this historical connection between pensions and hyperinflation can indeed be perceived as a personal endeavour by Blüm, in his interpretation of the German past and its consequences for the present he was not challenged by his contemporaries though they held different opinion on policy.

Then, from the late 1980s onwards budget discipline emerged as the decisive policy proposal semantically connected to hyperinflation in the debates on European monetary integration. Alike the German press and the Bundesbank (Löffler 2010; Tognato 2012), the government leading CDU/CSU and the FDP repeatedly invoked not only the notion of stability culture but the memory and experience of hyperinflation to argue for stability-oriented monetary policy and like-minded fiscal policy. According to the prevalent line of argument, the monetary history of two hyperinflations engrained an overarching, nation-wide “sensitivity towards issues of inflation and currency”,^[89] a nation-wide culture of stability (cf. Howarth and Rommerskirchen 2013), a widespread fear of a third currency reform, and collective reluctance to give up the D-Mark. Hence, to ensure that the newly founded Eurozone would emerge as “stability community”,^[90] strict fiscal rules – the Maastricht criteria and the SGP – were needed to shield the ECB from countries that “have taken a different historical path”,^[91] to give the new currency “a foundation of stability”,^[92] and fulfil the pledge given to the German people that the new currency would be “as stable”^[93] as their former. As prominent examples, in 1988, Chancellor Kohl reasoned that only countries which would “submit themselves unreservedly to the discipline of this system”^[94] and thus would not divert the ECB from its mandate “we Germans from our painful history know to appreciate”^[95] could become members of the future Eurozone. Likewise, in 1993, Kohl cautioned to follow through with fiscal convergence pointing to “the dire experiences of the great inflation after the first world war many of us heard from our parents”.^[96] Similarly, Finance Minister Waigel underscored to take the fears of those “who have had to endure one or even two currency reforms”^[97] seriously and ensure that every future EMU member would “basically adopt the German economic, currency and stability paradigm”.^[98] From the ranks of the FDP, the same line of argument was put forward repeatedly by Economy Minister Günter Rexrodt, Foreign Minister Genscher, and chairman Wolfgang Gerhardt.^[99] While this perspective was indeed pushed mainly by the aforementioned governing parties, again, the opposition did not contest but adopt a similar rhetoric largely agreeing for the need of fiscal convergence with recourse to German monetary history.

Following the introduction of the Euro, collective memories of hyperinflation faded from parliament and only briefly surfaced in the debates on the SGP and after the financial crisis.^[100] However, as the semantic link between hyperinflation and budget discipline dominated the public discourse among German press (Fischer 2010), the Bundesbank (Weidmann 2011, 8f.) the German government (Schäuble 2010), and academia (Sell and Sinn 2012), it likewise prominently resurfaced during the Eurozone crisis. This time, the CDU/CSU largely abstained from mentioning hyperinflation when debating potential avenues for crisis response. The only direct reference in the Bundestag was made in a speech of financial committee member Norbert Schindler (CDU) on the bilateral credit lines to Greece and potential response strategies arguing not risk public trust in the Euro, as “after all, the people in Germany have twice already lost all their money to currency reforms”.^[101] Beyond, the striking figurehead of collective remembrance was FDP chairman Rainer Brüderle. During 2011 and 2012, Brüderle time and time again alluded to the dire memories of hyperinflation when arguing for a tightening of fiscal rules and against Keynesian approach to solving the Eurozone crisis. By directly reverting to the discursive pattern that shaped the debates on EMU during the 1990s, Brüderle argued that the experience of hyperinflation had created nation-wide fear of inflation “engrained in the German genetic code”^[102] and a stability culture which served as the German “dowry”^[103] for the Eurozone (Löffler 2005). As such, it begged relentless defense and re-anchoring. Should this strategy fail, higher deficits and debt were tolerated, and fiscal transfers would be established, not only inflation but with it the demise of the European project as such would ensue. Although as mentioned above, during the crisis hyperinflation and its specific stability-related reading was only referred to by the FDP within the Bundestag, the general appeal to the historically-charged stability culture was widely shared by the CDU/CSU (cf. Howarth and Rommerskirchen 2013). Thus, again, the historical connection between hyperinflation found large-scale support that was largely accepted in parliament.

After the CDU/CSU and FDP led government was successful in pursuing a response strategy of fiscal austerity, following the crisis, the collective memory of hyperinflation and the semantic link to both public spending and budget discipline largely vanished from the parliament, resurfacing only briefly in debates on employment and budgetary matters.^[104]

3.2.3 A Stable Inflation Trauma?

In sum, as with the personal memoirs, the Bundestag speeches reveal both stability and heterogeneity in the collective remembrance of the Weimar hyperinflation. While there was a certain continuity in the semantic connection between calls for stability-oriented monetary policy and budget discipline and the memory of hyperinflation serving as a causal vindication, neither co-occurred or were linked uniformly with the memory of 1923. Rather, Bundestag speeches not only alluded to the Weimar hyperinflation without reference to stability policy (cf. Figure 2). Also,– in contrast to today’s prevalent conflation with fiscal restraint, they called for an expansion of public spending based on the lasting effects of hyperinflation For the realm of fiscal policy, especially within the communicative memory among those who experienced hyperinflation first hand, the interpretation of the event strongly varied, as Bundestag members justified public spending with hyperinflation, openly rejected any fiscal influence on prices, and only partly conflated the historical memory with budget discipline. Hence, initially, there was a striking openness to the memory of Weimar which – as it appears here – did not galvanize an overwhelming longing for stability-oriented policy and an instinctive support to stabilize prices at any cost as one would expect given today’s notion of inflation trauma.

Only as the collective remembrance transcended the communicative sphere and only those who did not witness the event first-hand debated its lessons, parliamentarians began an active process of sense-making delineating the given situation with the acclaimed historical analogies and juxtaposed the two perspectives of budget discipline and public spending drawn from the experiences of the anteceding generation. During this process, a discursive alignment transpired the Weimar memory became more and more formalized and indeed assumed today’s codified cultural character in regard to budget discipline.

For the realm of monetary policy and the pertinent variable of stability-oriented monetary policy this process of codification is even more apparent, as the semantic link between independent, stability-focused central banking and hyperinflation from the 1950s onwards only surfaced occasionally but especially during formative periods of European integration during EMU formation and the Eurozone crisis However, during those debates, it was never substantially challenged or otherwise object to re-interpretation.

This finding is confirmed when comparing the Bundestag’s debates with the media discourse:^[105] Overall, the German press did not cover the respective debates themselves. However, while the memory of the Weimar hyperinflation did appear time and time again within the reporting, a similar dynamic as in the parliamentary speeches can be observed. Specifically, from early on, the stability-oriented perspectives of budget discipline and stability-oriented monetary policy surfaced severalfold in connection to hyperinflation (e.g. Der Spiegel 1956a; Frankfurter Allgemein Zeitung 1956; Grüneberg 1954). However, this conflation did not dominate the overall outlook on Weimar within reporting. Rather, as in the parliamentary debates, multiple articles mentioned hyperinflation when reporting on the revaluation of savings and social services, thereby more or less explicitly underscoring a logic of public spending (e.g. Arps 1953; Der Spiegel 1953, 1956b; Hauenstein 1959).

Moreover, in the following years, the perspective of public spending largely faded while the narrative connection between hyperinflation and stability-oriented policy became “firmly entrenched” (Mee 2019, 272) within the media reporting though only occurring sporadically. As in the Bundestag debates, it then featured heavily from the early 1990s onwards and characterized reporting and commentary especially by conservative economists during the debates on the inception of EMU (Blankart 1995; Giersch 1996; Fleischhauer 1997; Schmidt-Klingenberg 1998; Tietmeyer 1991b; see also Löffler 2010) and the Eurozone crisis (Dyck, Hesse, and Jung 2012; Joffe 2014; Startbatty 2013; Mayer 2012). Thus, putting these observations into a nutshell, there is strong plausibility to interpret today’s conflation between inflation trauma and stability-policy to be foremost a product of a deliberate reconstruction bound to specific policy debates.

This finding is especially underlined when considering the idiosyncratic, politically-biased nature of the Weimar memory as a conservative narrative: As indeed, the majority of all references to collective memory its link to stability-oriented monetary policy and budget discipline were made my powerful members of the CDU/CSU and were increasingly supported by the FDP , this indicates a deliberate reconstruction of the collective memory “chosen” (Volkan 2001) in times of political expedience, e.g. countering the government when in opposition during the 1970s, pushing for pension reforms during the 1980s, but most importantly when transposing and defending German stability culture during the 1990s and 2010s. That such process was largely uncontested and thus successful could meanwhile point to the fact that indeed there was a lively collective memory that could be activated to create historical consistency and thus claim authority. However, the stability-bias of such memory was not a persistent semantic trait but emerged within said process of discursive alignment forming the notion of inflation trauma we encounter today.