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Germans Say Goodbye to the Mark, a Symbol of Strength and Unity

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January 1, 2002, Section A, Page 8Buy Reprints
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When euro notes and coins finally become legal tender in 12 European nations on Tuesday, few people will bid farewell to their old currencies as reluctantly as Germans to their marks.

In the half-century since Germany emerged from the horror of Hitler's Third Reich, the mark has become an icon of strength and stability, rebirth and reunification.

For Germans, the currency is one of the country's few national symbols. It has been an icon of sound money, closely tied to Germany's ''economic miracle'' after World War II. Internationally, it has been a safe haven, similar to the dollar, for those fleeing economic instability.

Long before the 12 countries formally adopted the euro, nations as varied as France, Austria, the Netherlands and Belgium had already locked the value of their own currencies to the mark. For the euro, which will emerge from A.T.M.'s and cash registers on Tuesday, the rate is fixed at 1.955830 marks.

Not surprisingly, polls show that more than half of all Germans would rather not change. But they are not so much giving up the mark as exporting it to the rest of Europe.

The laws that underlie the euro and the European Central Bank are in large part a reflection of the ironclad German monetary policies:

Inflation is evil; fiscal and monetary prudence is good; and a currency must be managed by a politically independent central bank.

Though Germany has printed and minted marks since 1871, the deutsche mark that is now fading away was born in 1948, three years after Germany's defeat in World War II.

The notes bear the images of German cultural and scientific figures, and are balanced almost evenly between men and women. The 20-mark bill features Annette von Droste-Hülshoff, a 19-century writer; the 50-mark bill features an architect, Balthasar Neumann. The 1,000-mark bill, which is worth about $460 and is rarely seen, features the Brothers Grimm.

Before World War II, Germany provided textbook examples of how to misuse a currency in the pursuit of reckless war making.

To finance World War I, German leaders took the previous currency, the reichsmark, off the gold standard. An advertising campaign implored people to turn in their old gold-mark coins with the slogan, ''I gave gold for iron.''

By the time Germany surrendered in 1918, and was forced to pay reparations, the reichsmark had lost any anchor in real wealth.

Then in the 20's, Germany suffered one of the world's worst cases of hyperinflation. Between May and November of 1923, the price of a kilo of sugar climbed from 474 reichsmarks to a stunning 5.6 billion.

That crisis alone robbed Germans of their savings and instilled a fear of inflation that was passed down from generation to generation and remains deeply entrenched to this day.

After Germany surrendered to the Allies in 1945, the combination of price controls and a nearly worthless mark led to a new spiral of inflation: acute shortages of most products, long lines and exorbitant black-market prices.

To break the vicious cycle, German leaders and Allied occupation officials introduced a currency reform measure in June 1948 that created today's mark.

People were forced to convert reichsmarks to German marks, but at an exchange rate of less than 10 to 1. On paper, people lost 93 percent of their savings. But stores suddenly began stocking shelves with the meat, milk, bread and other goods that had seemed impossible to find.

With the ''economic miracle'' after the war, the mark became a symbol of success and stability embodied by the Bundesbank, an independent central bank.

After the fall of the Berlin Wall in 1989, the mark became a symbol of German reunification. When western and eastern Germany reunited a year later, eastern Germans received the huge windfall when they were able to convert their worthless ost-marks into German marks at a generous one-to-one ratio. Now, not surprisingly, polls show that eastern Germans are more reluctant than western Germans to give up the mark. But given the painful memories of 1923 and 1948, many western Germans tremble at the mere mention of another ''currency reform.''

''I can still remember the reichsmark, through my grandparents,'' said Dieter Rohls, who is 60 and works at a bank in Frankfurt. ''I think the mark was better than the euro will ever be.''

Hermann Diekmann, an 80-year-old retired librarian, said he had come to terms with the euro and understood that it had existed as a ''virtual currency'' since 1999.

''I lived through the two currency reforms, and what happens now is not a real currency reform,'' said Mr. Diekmann, shortly after buying several ''starter kits'' of euro coins that can be used beginning Tuesday. ''It is only a changeover.''

The retirement of the mark has not gone the way either German or French leaders expected. France's late president, François Mitterrand, thought the euro would diminish Germany's economic dominance in Europe. But the European Central Bank turned out so similar to the Bundesbank that German approaches to money have now become the law of Europe.

Germans have been surprised as well. German economic growth has been the slowest in Europe in recent years, and its weakness has been one of the main reasons that the euro has lost nearly one-fifth of its value against the dollar since 1999.

Former Chancellor Helmut Kohl used to vow that ''the euro will be a strong as the mark.'' In practice, the euro has turned out to be as weak as the mark.

A version of this article appears in print on  , Section A, Page 8 of the National edition with the headline: Germans Say Goodbye to the Mark, a Symbol of Strength and Unity. Order Reprints | Today’s Paper | Subscribe

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