Why is socializing a failed concept

Contemporary history in Hessen - data · facts · background

socialization

  1. Overview: Socialization in Hessen - a temporary consensus on the socialization of basic and key economic industries
  2. The alternative to expropriation and nationalization
  3. Separate decision item in the referendum on the Hessian constitution on December 1, 1946
  4. How should socialization be implemented? - The bill presented in 1948
  5. The attitude of the Americans
  6. Disagreement between the parties
  7. Criticism of the cost
  8. Affected companies

1. Overview: Socialization in Hesse - a limited consensus on the socialization of basic and key economic industries

Socialization in Hesse describes the attempt made on a political level between 1946 and 1955 to create suitable conditions for the transfer of means of production to common property. Due to the result of a referendum on the socialization of basic economic and key industries in December 1946, the transfer of mining, iron and steel production, the energy industry and rail or overhead line transport, as well as the supervision or administration of major banks and insurance companies in the hands of the state as Article 41 ("Socialization Article") anchored in the Hessian constitution with the aim of using it for the common good. The demand for a socialization of key areas of the Hessian economy ("partial socialization") found support in the immediate post-war period, both from the part of the social democracy Change of the political balance of power through socialization of their economic foundations propagated, as well as on the part of the Christian Democrats, who - in accordance with their initial commitment to Christian socialism - also spoke out in favor of socialization in the field of mining and iron-producing large-scale industry.

2. The alternative to expropriation and nationalization

Socialization (or Vergesellschaftung) in the sense of the transition from private property to common economic purposes, which is aimed at in Hesse, is not to be equated with "nationalization". The former includes the Conversion of individual private ownership of means of production into the property of shareholders or into the property of society in which people associate as a cooperative, in whose name the democratic state acts. This includes the definition of a concrete, economic democratic organizational principle, while nationalization de facto only regulates the property relationship.1 In this sense, Article 15 also anchors a basis for socialization in the German Basic Law, although this option on the basis of the German constitution - in contrast to the Hessian constitution - has never been used to this day.

3. Separate decision item in the referendum on the Hessian constitution on December 1, 1946

In the referendum on December 1, 1946, scheduled for the decision on the Hessian constitution as a whole, the vote on Article 41 of Socialization was carried out separately by order of the US administration, which was skeptical of the socialization efforts; 76.4% of the participating voters supported the constitution as a whole, a little less, namely 72%, supported Article 41. This result stood among other things. 19 lignite mines, 11 energy-related stock corporations and a large company in the iron-producing industry (the Buderus'schen Eisenwerke in Wetzlar) for socialization.

Article 41 of the Hessian constitution, as it was put to the vote, reads as follows:

(1) With the entry into force of this constitution: 1. The following are transferred to common ownership: mining (coal, potash, ores), the iron and steel production companies, the energy industry and the transport system tied to rails or overhead lines, 2. supervised by the state or administered: the major banks and insurance companies and those companies named in section 1 whose headquarters are not in Hesse. (2) The law determines the details. (3) Anyone who is the owner of a company subsequently transferred to common ownership or who is entrusted with its management must continue to act as trustee of the state until implementation laws are passed.

4. How should socialization be implemented? - The bill presented in 1948

To do this, it first had to be clarified which legal entities the companies should take over, in which form they should be managed, controlled and coordinated, and how the generated income was used.

A ministerial draft prepared for the concrete implementation of the socialization, which was available at the beginning of 1948, contained the grouping of the (large) companies in the named economic sectors into so-called “Social communities” whose economic management was linked to a public economic objective. These were to be managed by a board of directors appointed by the administrative board, which consisted of a commercial, a technical and a social director. The board of directors in turn comprised 15 members, one third each from the trade unions, one third from the home community as consumer representatives and one third from the “regional community”. The regional community, which is made up of third parity like the social communities (here: appointment of the administrative council by the state parliament, the Free Trade Union Federation of Hesse and the municipal umbrella organizations) was also responsible for coordinating the social communities; it had an investment and compensation fund into which two fifths of the income generated by the social communities would flow. The use of the surpluses was tied to specific purposes.2

After monitoring committees and trustees had already been appointed as a result of the clear result of the referendum, the planned socialization failed due to the worsening disagreement between the parties and the unclear legal status of the companies covered by the socialization.

5. The attitude of the Americans

The American occupying power saw itself in conflict on the question of socialization in Hesse: On the one hand, there was no question that the free market economy was considered indispensable as a supporting element of democratization. On the other hand, the Americans' own postulate of democracy forced them to respect a democratic decision made by the Hessian population in the zone they occupied, which made possible the socialization of the basic industry. It was only in the face of internal resistance that the Americans made the decision to forego the principle of excluding a democratically legitimized socialization in the US zone and to tolerate a restrictive interpretation of socialization.3 A corresponding decree, contained in the JCS 1779 directive of July 15, 1947, paragraph 21c, states this4: „While it is our duty to give the German people an opportunity to learn of the principles and advantages of the free enterprise, you will refrain from interfering in the question of public ownership of enterprises in Germany, except to ensure that an choice for or against public Ownership is made freely through the normal processes of democratic government. No measure of public ownership shall apply to foreign-owned property unless arrangement which are satisfactory to your government have been made for the compensation of foreign owners. Pending ultimate decision as to the form and powers of the central German government, you will permit no public ownership measure which would reserve that ownership to such central government.

Finally, the American military government took the position that the title of property would not automatically be transferred to the Hessian state government with the help of Article 41, but required a legal regulation of the legal details and compensation for the owners.5

6. Disagreement between the parties

The socializations provided for in Article 41 were never fully implemented. All large companies in the important sectors of the basic industry gradually fell out of socialization. In view of the difficulty of controlling the remaining small and medium-sized businesses, which were only managed in trust by their previous owners since 1946 and also often made losses, the Hessian Minister for Economics and Transport Harald Koch (1907-1992; SPD) developed the idea to merge the companies in question and to operate them in the new legal form of the social communities that have already been explained.

The model devised by Koch for the practical implementation of socialization divided the social communities into several different categories. In addition to the so-called "social societies" (iron and steel, energy and transport) and "social unions" (mining), the social cooperatives (smaller companies) and, as a special form, the "regional community of social communities in Hesse", which is a self-governing body of the socialized part of the Hessian economy acted.6

After the draft law submitted by Koch had been referred to a cabinet committee made up of equal numbers by the CDU and SPD, the parties in the cabinet floor quarreled.

While the SPD stuck to the draft in order to “create a model for federal legislation”, the CDU did not risk a full veto against the bill, which enjoyed widespread publicity, but undermined the proposal with a number of smaller requests for change: in addition to the approval of other legal entities ( So not only the "social communities") should now remove the limitation of reserves, and 60 instead of 20 percent of the surpluses of the social community remain. For reasons of increasing competition in an economic environment that was reorganizing according to capitalist principles, the Christian Democrats saw it as necessary to forego an explicit account of liability relationships, interrelationships, cartels and salaries in the annual reports. The softening of the original idea of ​​socialization due to economic constraints ultimately did not prevent the bill introduced by the Social Democrats from being rejected on October 27, 1950 by 41 to 41 votes.

In addition, after initial reluctance at the end of 1948, the American military government had already made its rejection of more extensive socialization clear: on December 6, 1948, on the basis of the Control Council Act No. November 1948 the socialization of the companies belonging to these branches. Act No. 75 on the unbundling thus declared the entire coal and steel industry in Hesse to be confiscated. The aim of the measure was to transfer the companies active in mining and heavy industry to newly founded private companies. The majority of the companies affected by the socialization in accordance with Article 41 were thus withdrawn from transfer to common ownership and the Hessian intention to socialize was undermined in a decisive way.7

7. Criticism of the cost

The socialization, which was only partially carried out, came under public criticism, also because of the expenses associated with it. Compensation amounting to 30.4 million D-Marks was reimbursed for the construction of the Hessian mines and smelting works alone. In 1953 only a dozen mostly less important Hessian companies were considered socialized. According to information from the Hessian State Minister for Labor, Agriculture and Economy, Heinrich Fischer (1895–1973; SPD) at this point in time (until September 15, 1953) the total costs “really” related to the socialization article of the constitution amounted to a sum of almost 230 million Deutschmarks. Not included in this amount, however, were 19.8 million DM for “new developments, investments and all other operational measures” that had been paid to the socialized companies since 1948.8

8. Affected companies

The only large Hessian company that was significantly affected by the provisions of Article 41 of the Hessian Constitution was the iron smelting and iron processing company Buderus (Buderus'sche Eisenwerke), which has its headquarters in Wetzlar, and its mines, smelters and electricity companies in the trustee administration passed over of the country.9 In order to mitigate the effects of the nationalization of important parts of the company, the company split into a part of the steel works subject to Article 41 and a part relating to further processing that remained in private hands. Buderus led a long-term legal dispute about the controversial partial socialization, which the company lost, but was able to maintain its influence on the independent corporation, officially separated from Buderus' sphere of control in 1954 as a "mountain hut".

Kai Umbach


  1. Cf. Deppe, Frank: Vergesellschaftung, in: Ulrich Brand / Bettina Lösch / Stefan Timmel (eds.): ABC of alternatives. From »Aesthetics of Resistance« to »Civil Disobedience«, Hamburg 2007, pp. 242-243. ↑
  2. HeBIS Winter, Gerd: Socialization in Hessen 1946-1955, in: Kritische Justiz: Vierteljahresschrift für Recht und Politik, Vol. 7 (1974), pp. 157-175, here: p. 161 (as a pdf download online, accessed on 07.03.2013). ↑
  3. Link, Werner: The Marshall Plan and Germany, in: Hans-Jürgen Schröder (Ed.): Marshall Plan and West German Resurgence: Positions - Controversies, Stuttgart 1990, pp. 79–94, here: p. 87. ↑
  4. Quoted in ibid. ↑
  5. See in detail on the position of the Americans: Winter, Gerd: Socialization in Hessen 1946-1955, in: Kritische Justiz: Vierteljahresschrift für Recht und Politik 7 (1974), pp. 157-175. The view taken by the American military government at the end of the 1940s, however, was viewed quite differently a few years later in the legal dispute over the transfer of ownership by the State Court of Hesse: it ruled in June 1952 that, in accordance with Article 41 of the Hessian constitution, iron and steel production companies , the coal, potash and ore mining, the energy industry and the companies of the rail and overhead line transport system "with the entry into force of the constitution" were transferred into common ownership. Previously, the parliamentary group of the FDP had requested the State Court to determine that Article 41 of the Constitution was not directly applicable law and that therefore the commercial enterprises concerned had not automatically passed into common ownership. The majority of the scientific legal opinions drawn up on this question also came to the conclusion that the socialization article of the Hessian constitution could only have programmatic significance. The constitutional order requires a law to carry out socialization, which regulates the transition to common property in all details "and in particular also defines the new legal entity and the compensation that is due to the old owners". Cf. Die Zeit of June 12, 1952, No. 24, p. 2: “Socialization made easy”. ↑
  6. See in detail: Koch, Harald: Socialization! : A way to achieve; Legal form of socialization with special consideration of socialization in Hessen, Hamburg 1947; Ders. (Ed.): The social communities: Draft of the Hessian socialization law with justification and introductory contributions by the employees of the Hessian Ministry of Economics, Hamburg 1948. ↑
  7. Weitzel, Jürgen: The property problem (land reform, socialization), in: Bernhard Diestelkamp: Between continuity and foreign determination: the influence of the occupying powers on the German and Japanese legal system: 1945 to 1950. German-Japanese symposium in Tokyo from April 6th to 9th 1994, Tübingen 1996, pp. 195-212, pp. 210 f. ↑
  8. Cf. David, Heinrich: Hessens “Volkseigene Betriebe”, in: Die Zeit from November 12, 1953, No. 46. ↑
  9. In addition, from 1946 there was initially the “trustee management of Buderus' ore mines, blast furnace and electricity companies in common ownership”. In 1952 the Hessische Berg- und Hüttenwerke AG Wetzlar was established, in which the State of Hesse held 74% and Buderus'schen Eisenwerke held a 26% stake. In 1965 Buderus bought back the majority stake in the state. Finally, Hessische Berg- und Hüttenwerke AG was converted to Buderus Aktiengesellschaft with effect from July 1, 1977. ↑
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Article 41 · Socializations
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  1. SPD presents constitutional policy - the Hochwaldhäuser resolutions, May 30, 1946
  2. Draft constitution of the SPD for the deliberations of the state assembly advising the constitution, July 1946
  3. Completion of the draft constitution, September 30, 1946
  4. Adoption of the new Hessian constitution, October 29, 1946
  5. Popular vote confirms the constitution with a large majority, December 1, 1946
  6. Elections to the Hessian state parliament, December 1, 1946
  7. First government declaration by Prime Minister Stock and presentation of the cabinet, January 6, 1947
  8. Labor and Economics Minister Wagner presents the ministry's problems, December 11, 1949
  9. Influence of the SPD federal executive on the formation of a government in Hesse, December 8, 1950
  10. Presentation of the cabinet and government declaration by the Prime Minister in the Hessian state parliament, January 10, 1951
  11. Election of the non-judicial members of the Hessian State Court, March 21, 1951
  12. Hessian State Court negotiates Article 41 of the Hessian Constitution, April 1951
  13. The State Court of Justice will examine the constitutionality of the socialization provisions, April 5, 1951
  14. Proclamation of the judgment of the State Court of Justice on Article 41 scheduled for June 8th, June 4th 1951
  15. Hessian State Court declares socialization legally valid, July 20, 1951
  16. Submission by the state government to the State Court of Justice regarding the FDP's complaint, December 1951
  17. Resumption of the proceedings under Article 41 of the Hessian Constitution applied for, December 5, 1951
  18. Prime Minister Zinn announces a lawsuit against SPIEGEL, December 6, 1951
  19. Statement by the FDP on the debate on Article 41 of the Hessian constitution, December 7, 1951
  20. SPIEGEL statement on reporting on tin, December 7, 1951
  21. CDU calls for state government to comment on the Schuman Plan, December 18, 1951
  22. The State Court of Justice rejects the application of the FDP parliamentary group, January 20, 1952
  23. Hessian cabinet adopts implementing regulations for socialization, February 1, 1952
  24. Ministry of Economic Affairs demands the complete expropriation of Buderus in Wetzlar, February 5, 1952
  25. Ministry of Economic Affairs gives press conference to correct the Buderus plan, February 6, 1952
  26. FDP takes a stand against the implementing provisions for socialization, February 15, 1952
  27. First reading of the implementing provisions for Article 41 of the Hessian constitution, March 1952
  28. State parliament debate on implementing provisions for articles of socialization, March 12, 1952
  29. FDP applies to the State Court of Justice to rerun the Article 41 proceedings on March 18, 1952
  30. Hessian State Court rejects the FDP's application for reopening, April 2, 1952
  31. Declaration by Prime Minister Zinns on community operations and socialization, April 9, 1952
  32. Reaction of the FDP parliamentary group to Zinn's declaration on community operations and socialization, April 11, 1952
  33. Negotiations about Grube Emma before the Wiesbaden Labor Court, April 30, 1952
  34. Tax estimate for accounting year 1952, May 23, 1952
  35. Foundation of the Hessische Berg- und Hüttenwerke AG in Wetzlar, June 4th 1952
  36. Hessian State Court confirms the validity of the article on socialization, June 6, 1952
  37. Constitutional complaint by Hessian companies against the judgment on Article 41, August 8, 1952
  38. Investigation by the German Industrial Institute declares socialization invalid, September 1952
  39. Socialization of the private railways is reversed, November 22, 1952
  40. Ministry of Economic Affairs comments on reports on the socialization of private railways, December 23, 1952
  41. The CDU applied to the state parliament for support for the Hessian economy on January 15, 1953
  42. German Industry Institute criticizes Hessian socialization, May 27, 1953
  43. State and Kasseler Verkehrsbetriebe reach agreement in the socialization dispute, May 29, 1953
  44. Hessian state parliament discusses socialization, October 21, 1953
  45. State government advises final law on socialization, March 14, 1954
  46. Compensation costs for expropriations estimated at 30 million DM, April 14, 1954
  47. Hessian cabinet approves draft final law on Article 41, May 4, 1954
  48. Prime Minister Zinn declares the implementation law for Article 41 in the state parliament, May 27, 1954
  49. Termination of the socialization projects by the final act, July 6, 1954
  50. Hessian state parliament decides to supplement the final act on Article 41, July 1, 1965