Heinz Hoffmann. Als privater Unternehmer in der DDR - eine Dresdner Firmengeschichte. Beucha: Sax-Verlag, 2003. 192 S. EUR 24.00 (cloth), ISBN 978-3-934544-50-5.

Reviewed by Andrew I. Port (Department of History, Wayne State University)
Published on H-German (March, 2007)

The Secret of His Success

In March 1987, Heinz Hoffmann informed East German planning authorities in Dresden that his private firm, founded by his father in 1896, would discontinue its food export trade at the end of the year and that he himself would significantly reduce his business activities because he was about to reach retirement age. He outlined the real reasons for his decision in a confidential letter sent a half year earlier to a former business associate in Berlin: the frustration of doing business in the German Democratic Republic (GDR) had simply become too great. Shortages of goods and labor, "old and rundown factories," "interminable indifference," and a widespread sense of inferiority vis- à-vis the Federal Republic had increasingly led over the previous decade to a discernible decline in the quality of the products he exported to the West, and as a merchant, "one must have the courage to quit when one's reputation is at stake" (pp. 130, 160, 166-167).

Anticipating his colleague's objection that similar deficiencies had always existed in the GDR, Hoffmann categorically declared at the end of his letter that this was not true and that everything had become incomparably worse in recent years. The accuracy of his observation was arguably less important than the fact that he and other East Germans apparently perceived this to have been the case. In fact, the palpable exasperation expressed in the letter gives a good sense of the prevailing popular mood during the twilight years of the GDR, and, in so doing, offers important clues about why the regime finally fell apart not long after Hoffmann himself decided to call it quits. This chronicle of a private family firm under state socialism is not, however, the story of an inevitable "decline by installments."[1] Rather, it is the story of how entrepreneurship survived and even thrived for more than forty years under extremely unfavorable economic and political conditions.

As such, much of this memoir, a mixture of career autobiography and business history, focuses on the many challenges that Hoffmann faced as a wholesaler and exporter of foodstuffs, ranging from the discriminatory policies of a state whose leadership was ideologically wedded to the idea of eliminating the private sector to the scheming activities and antipathies of West German competitor firms eager to eliminate business rivals both near and far. Despite stifling tax burdens, ruinous official price policies, periodic harassment by state security officials, the failure of domestic suppliers to honor their contracts and--last but not least--the discovery in Belgium of a baking agent that threatened to make superfluous the firm's main export to Western Europe, malt flour, Hoffmann's firm somehow managed to endure for four decades. What was the secret of his success?

According to Hoffmann, his ability to ensure the punctual delivery of quality wares, at least until the late Honecker years, was the most significant reason for the success and longevity of the firm, which controlled 70 percent of the West German malt flour market by the end of the 1970s. That was no mean accomplishment, of course, given the GDR's well-earned reputation for sporadic production of low quality goods. Because of the firm's extensive involvement in export trade, it was often able to acquire materials, services and other benefits usually in short supply, which even allowed for the construction of a private laboratory used to ensure quality control. Why was this the case? As Hoffmann readily admits, the role that his firm played in obtaining hard currency, Devisen, for the GDR was the main reason it enjoyed so many advantages and was tolerated for so long by a regime known for its hostility toward the private sector.[2]

Other factors undergirded the impressive performance of the firm, not least the business acumen and resiliency of Hoffmann as well as his mother, who single- handedly got the firm back on its feet after the war and who died sitting "at her desk" in 1976 (p. 10). The family's repeated willingness to change the focus of the firm's activities in response to chance events as well as political and economic contingencies, coupled with the ability to find legal loopholes that allowed the firm to expand its activities, gradually allowed it to occupy a niche tolerated by central planning authorities hungry for foreign currency. "Ich vermag mein berufliches Leben in der DDR nicht unter ein negatives Vorzeichen zu setzen," Hoffmann writes toward the end of his memoirs. "Vieles war unerfreulich und ökonomisch töricht, aber es gab auch positive Seiten immer dann, wenn der persönliche Erfolg befriedigte. Dass die materielle Existenz nicht ungünstig war, sei erwähnt" (p. 173).

As the above suggests, and despite all obstacles and all appearances to the contrary, the Unternehmerethos was apparently alive and well east of the Elbe. Without engaging in Ostalgie or universal damning of the now-defunct regime, Hoffmann describes in a sober and evenhanded fashion the successes and failures, highs and lows, of his long business career. Still, one cannot help but wonder how and why a person raised in a "conservative-bourgeois family" (p. 28) and clearly unsympathetic to the tenets and practices of state socialism could remain for so long in the GDR and contribute to the economic viability, and thus stability, of a regime that he found more than distasteful--a regime that jailed him for more than a month in mid-1953 on trumped-up charges, repeatedly tried, without success, to recruit him as a spy and habitually instituted policies aimed, sometimes more, sometimes less explicitly, at undermining his livelihood.

During a business trip to Switzerland in the late 1950s, Hoffmann was asked why he did not leave the GDR permanently. He does not reveal the answer he gave at the time, and only hints elsewhere in his memoir at his reasons for not "fleeing the republic," something he had had ample opportunity to do both before and, as a so-called Reisekader, after the construction of the Berlin Wall in 1961. One can only guess at his motivation, but in the end, as Hoffmann freely acknowledges, he enjoyed a relatively privileged existence in the GDR. The maddening bureaucratic annoyances that accompanied his frequent business trips to the West--such as the need to submit detailed and time- consuming reports about, among other things, the age, behavior, and facial characteristics of the West German border guards--may have placed a damper on those visits abroad, but they were only a small price to pay, perhaps, for a privilege that few of his fellow citizens enjoyed. Fewer still had the opportunity to attend the world-famous festivals in Bayreuth and Salzburg, use a so-called Valuta-Konto to obtain coveted western goods, or drive a Renault: "Wenn auch die Bezeichnung 'Reisekader' belächelt wurde, so löste die Tatsache, dass dieser die Grenze passieren konnte, Neid aus und dies war berechtigt" (p. 115).

To his credit, Hoffmann does not shy away from addressing another delicate issue, namely his own "conformity" (Anpassung) under the socialist regime: "Entscheidend aber ist ... wo der Einzelne die Grenze sieht, die er nicht überschreiten will und darf" (p. 73). Where did he draw the line? Hoffmann assiduously filled out the reports he was required to make both before and after visiting the West on business, including sections that asked about the political views and behavior of his fellow travelers. But he consulted with them beforehand to make sure that the information and details they all provided about their trip, including the fabrications, were consistent. Along similar lines, Hoffmann decided to pursue an advanced degree in business, but he did so for purely pragmatic reasons: "Die rein sachlichen Erkenntnisse aus dem Studium waren gering. Von bedeutendem Wert war das Fach 'Marxismus-Leninismus' schon deshalb, um die Denkweise ... des ideologischen Gegners kennen zu lernen. Ausserdem war dies beim Umgang mit staatlichen Stellen hilfreich" (p. 99). He balked at pursuing a doctorate, however, when told that he would only be allowed to do so if he were willing to give up his economic independence and become the director of a state-owned firm. Like many other East Germans, Heinz Hoffmann learned to walk a fine line between conformist and nonconformist behavior. And that, too, provides yet another clue to the secret of his success.

Notes

[1]. Armin Mitter and Stefan Wolle, Untergang auf Raten. Unbekannte Kapitel der DDR-Geschichte (Munich: Bertelsmann, 1993).

[2]. On the official treatment of the East German private sector, see Frank Ebbinghaus, Ausnutzung und Verdrängung. Steuerungsprobleme der SED- Mittelstandspolitik 1955-1972 (Berlin: Duncker & Humblot, 2003).

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Citation: Andrew I. Port. Review of Hoffmann, Heinz, Als privater Unternehmer in der DDR - eine Dresdner Firmengeschichte. H-German, H-Net Reviews. March, 2007.
URL: http://www.h-net.org/reviews/showrev.php?id=12989

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