austin-murphy-the-triumph-of-evil

294 THE TRIUMPH OF EVIL
against the presidential "party slates" in the USA. In two of the three attempts I required
the assistance of the voter registration officials, who largely ridiculed my vote publicly,
and in the third attempt, I doubt my vote was properly counted. My conversations with
East German dissidents who attempted to vote against the party slate before the revolu­
tion indicate a similar system in East Germany, where simply marking a ballot with an
"X" represented a vote for the candidate list, and where use of a closed voting booth to
register a secret ballot was ridiculed by those in the queue who were anxious to return
to their own business. In addition, it should also be mentioned that claims of outright
fraudulent voter counts have also been alleged in the USA in recent times (Collier and
Collier, 1992).
II. Opp and Gem ( 1993) have estimated 124,500 to 166,000 participants in the Octo
ber 9, 1989 demonstration in Leipzig. In survey interviews conducted after unifica­
tion, these investigators stated that the demonstration seemed to be fa irly spontaneous
without any apparent leaders, although it is interesting to note that their research did
not allude at all to the public announcements played on the radio and on loudspeakers
essentially condoning the demonstration (implying that either the two Western researchers
conducted very superficial interviews, or they have a political agenda that motivated
them not to report such seemingly important facts).
12. It is also instructive to see that Western-oriented "free" market advocates, who
applauded the Soviet Union's movement to "democracy" under Yeltsin in 1991, pro
vided no opposition to Ye ltsin's appointment of his former head of the secret police,
Vladimir Putin (who had been a KGB officer in the 1980s), as his successor in 1999
(Cullison, 2000a), although they did formally protest Putin's bringing people with l�ftwing
opinions into the government (Chazan, 2000a). These "freedom" advocates (hke
the Ukrainians who collaborated with Hitler and who worked with the CIA to enact a
violent return of the Nazi "freedom" to exploit and kill) thereby confirmed that �heir
only real concern was about the "freedom" of the marketplace (which, as explamed
throughout this book, restricts people's freedom and creates an enormous amount of
repression and suffering in people's lives).
CHAPTER 4
1. Many of these problems are magnified in West Germany because the financial
markets are less liquid than more developed capitalist markets such as in the USA.
However, for private firms in East Germany that operated outside of state control, the
cost of capital was even higher than in West Germany because of heavy income taxa·
tion (90% for firms that do not supply services or essentials) and legal restrictions 00
the maximum number of employees (10), as explained in Der Tagesspiegel (1989a,
1989d).
2. This estimated purchasing power value of the East German Mark is also consistent
with the consumer price inftation figures reported by the West German govemme�t,
which showed eastern German inftation to be 2% lower than in western GermanY Jn
1990 but 12% higher in 1991 (Statistisches Bundesamt, 1992). These numbers, when
combined with the 16% higher inftation in eastern Germany after 1991, imply that the
consumer purchasing power of the East German Mark was equal to about 1 .28 West
German Marks. However, given that such purchasing power might apply to no more
than 80% of East German National Income, and given the fact that East German pro-
NarES 295
ducer prices fe ll by 500/o in 1990 to a distressed level well below their true value (van
Ark, 1995), the weighted-average aggregate inftation in eastern Germany was likely
closer to 15% higher than in western Germany after 1989, implying the 1989 exchange
me of 1.15 West Germany Marks per East German Mark. This estimate may actually
be too low, as one West German study indicated that, instead of insignificantly changing
during the time around the transformation of the East German Mark into the West
Gennan Mark, consumer prices in East Germany actually rose by over 25% between
January and July 1990 (Wei fens, 1992). Such a figure (combined with the subsequently
higher inflation in eastern Germany as its prices continued to rise to western German
levels over time), might imply the consumer purchasing power of the East German
M� was equal to that of 1.60 West German Marks (although the latter estimate may
nol fully adjust for quality differentials).
3. Data inconsistencies on relative living standards (Shrnelev and Popov, 1989)
caused by the use of official or black market exchange rates can greatly distort real
income comparisons because they are extremely poor indicators of true purchasing
power, as shown by Sheikh (1976), Schmitt (1980) and Daniel (1986). Such distortions
are avoided here because it is possible to use estimated purchasing power parity
exchange rates that are verified by the much higher prices that appeared in East Germany
when they were denominated in West German Marks compared to East German
Marks earlier (Neues Deutschland, 1991). While Shmelev and Popov (1989) have
hypothesized that the existence of shortages and other problems may make figures from
10111C Eastern European countries suspect, Collier ( 1985) has found the East German
figures to be fa irly reliable, even after adjusting for shortages. In addition, although
�Art (1995) estimated East German industrial productivity to be only 300/o of that
11 West Germany, his results are severely biased by an industrial purchasing power
comparison that failed to adjust for East Germany's heavy levies on industry to finance
COIIIUmption good subsidies.
4. Note that the 27% ratio of investment to National Income is measured gross of
�iation, i.e., it includes capital investment undertaken to replace depreciated assets.
Investment net of depreciation averaged only slightly over 20% of National Income in
East Germany.
S. While individual national account figures in all countries are subject to large error
IMorsenstem, 1963), no significant overstatement of output has ever been found for
lbe_East German accounts, which Schwarzer (1999) has cited as being as accurate as
lltlonal accounts for Western countries. Unbiased errors in national income should
'-�ely cancel out over the long time interval examined. Although Ritschl ( 1996) has
� 1 study indicating that East German output figures may have underweighted some
:: JI'Oduction (compared to West German weighting) and that East Gennan �
��German growth would still indicate it to be significantly higher than in West
·
&rowth may have therefore been overstated by I% annually, such a reductton
� .. ....y. It should also be noted that virtually all of this alleged neglected "output"
� effect is in the area of financial services, which the East German government
�ly provided via a very simple cheap and efficient system of savings, pen­
� llld insurance (Merkel and Wahl t991) a� which can correctly be considered to
011: . COlt f
•
0 real output (i.e., a cost of allocating funds to future consumption
' '
0 and needs)
OJIJioled to being an output itself (and theoretically should therefore not be mcluded
.