Can a Marxist Bring Berlin Back from the Dead?

Gregor Gysi's tie is loose, and he keeps glancing nervously at a six-inch-thick stack of papers waiting in front of him. He pours himself a cup of coffee but neglects to offer any to his guests. A chain smoker, he crumples an empty pack of Marlboros, chucks it in a metal wastebasket, and tears open another. Gysi is busy, he explains. His first appointment as economics minister for the city/state of Berlin begins at 9 a.m., and the last one is at 9 p.m. Then he has to prepare for the next day. "It's a stressful job," he allows, dragging on another Marlboro.

It's especially stressful when you come from a party that, in principle, is opposed to the whole idea of capitalism. Gysi represents the Party of Democratic Socialism (PDS), which took over the assets and much of the mission of the defunct Socialist Unity Party, which ran East Germany and built the Berlin Wall. Now, after winning 22.6% of the vote in October elections--just a percentage point behind the center-right Christian Democrats--the party is back in power in Berlin. In January, the PDS formed a coalition government with center-left Mayor Klaus Wowereit. Gysi, the best-known PDS leader, is the man responsible for wooing investment to the financially prostrate city.

It's a major chance for the ex-Communists and Gysi, 54. If he can show that the PDS has given up its Stalinist ways and can be a responsible member of a democratic government, the party could start to have an influence on national politics. Already, Gysi has real power. He is deputy mayor, which means he runs the city when Wowereit is out of town. The PDS dream is to be a formal coalition partner with the center-left Social Democrats. That won't happen this year, but it's a possibility in 2006--if Gysi plays his cards right. The Berlin post "is extremely important for the PDS," he says.

The question is whether Gysi can actually do anything about Berlin's economy. So far, his only real accomplishment is to keep his fractious party from dropping completely off the political radar screen. He is already saying some of the things business wants to hear, promising to cut back bureaucracy and work toward balancing the city budget (a task that falls mainly on the shoulders of the city's finance minister). But economists fear Gysi and other Berlin leaders are too used to living off federal subsidies to cope with the free market. "The whole idea of dealing with business is foreign to them," says Michael Burda, a U.S. economist who teaches at Berlin's Humboldt University. Gysi, who as a young man studied animal husbandry and later practiced law in East Berlin, has no experience in business.

Sure enough, Gysi complains that Germany's federal government isn't doing enough to help Berlin, which is closing swimming pools and slashing the city workforce to make ends meet. He also favors measures to prevent European regions from competing against each other on labor costs. But Gysi also acknowledges that Berlin has to learn how to break its subsidy habit. However reluctantly, he is doing the things economics ministers do to attract business. In June, for example, Gysi will be visiting Toronto, New York, and Washington to promote Berlin.

No doubt people will want to know if he is still a Marxist. Gysi says he believes Marxism is "a fabulous way to analyze society" but that he is no dogmatist. The main thing he wants is jobs: If accommodating capitalists is part of the price to pay, so be it. "They can have their profits if I can have my jobs," he says. That much, at least, sounds like a fair deal.

By Jack Ewing in Berlin

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