2 - The Bank deutscher Länder and the Foundation of West Germany, 1948–1951

Summary

This chapter examines the world in which the BdL was established. It centres on the period 1948–51, the latter being the year when monetary sovereignty was transferred by the Allies to the West Germans. The chapter documents the opinions of West German elites in the lead-up to the creation of the BdL, noting that they were split on the question of central bank independence. It argues that a political struggle surrounding the future of the central bank incentivised a variety of West German elites to confront their inter-war monetary history. The chapter then shows how the BdL adopted an active press policy in the effort to influence the Bundesbank Law. Such efforts failed to prove effective during this period, however. Other events, such as the Allied decision to transfer monetary sovereignty to West Germany in 1951, proved more decisive. But it was in this very period that the central bank established a workable framework of historical narratives that could be applied for political ends.