Berlin has long been in the cross-hairs of history: it staged a revolution, was headquartered by fascists, bombed to bits, ripped in half and finally reunited – all just in the 20th century! An accidental capital whose medieval birth was a mere blip on the map of history, Berlin puttered along in relative obscurity until becoming the royal capital of Prussia in 1701. It was only in fairly recent times that it significantly impacted on world history.

Medieval Berlin

The discovery of an oak beam suggests that Berlin may have roots going back to 1183 but, for now, history records that the city was officially founded in 1237 by itinerant merchants as twin trading posts called Berlin and Cölln. The modest settlements flanked the Spree River in an area just southwest of today’s Alexanderplatz. It was a profitable spot along a natural east–west trade route, about halfway between the fortified towns of Köpenick to the southeast and Spandau to the northwest whose origins can be traced to the 8th century. The tiny settlements grew in leaps and bounds and, in 1307, merged into a single town for power and protection. As the centre of the March (duchy) of Brandenburg, it continued to assert its political and economic independence and even became a player in the Hanseatic League in 1360.

Such confidence did not sit well with Sigismund, king of the Germans, who, in 1411, put one of his cronies, Friedrich von Hohenzollern, in charge of Brandenburg, thereby ushering in five centuries of uninterrupted rule by the House of Hohenzollern.

Reformation & the Thirty Years’ War

The Reformation, kick-started in 1517 by Martin Luther in nearby Wittenberg, was slow to arrive in Berlin. Eventually, though, the wave of reform reached Brandenburg, leaving Elector Joachim II (r 1535–71) no choice but to subscribe to Protestantism. On 1 November 1539 the court celebrated the first Lutheran-style service in the Nikolaikirche in Spandau. The event is still celebrated as an official holiday (Reformationstag) in Brandenburg, the German federal state that surrounds Berlin, although not in the city state of Berlin itself.

Berlin prospered for the ensuing decades until drawn into the Thirty Years’ War (1618–48), a conflict between Catholics and Protestants that left Europe’s soil drenched with the blood of millions. Elector Georg Wilhelm (r 1620–40) tried to maintain a policy of neutrality, only to see his territory repeatedly pillaged and plundered by both sides. By the time the war ended, Berlin lay largely in shambles – broke, ruined and decimated by starvation, murder and disease.

Road to a Kingdom

Stability finally returned during the long reign of Georg Wilhelm’s son, Friedrich Wilhelm (r 1640–88). Also known as the Great Elector, he took several steps that helped chart Brandenburg’s rise to the status of a European powerhouse. His first order of business was to increase Berlin’s safety by turning it into a garrison town encircled by fortifications with 13 bastions. He also levied a new sales tax, using the money to build three new neighbourhoods (Friedrichswerder, Dorotheenstadt and Friedrichstadt) and a canal linking the Spree and Oder Rivers (thereby cementing Berlin’s position as a trading hub), as well as the Lustgarten and Unter den Linden.

But the Great Elector’s most lasting legacy was replenishing Berlin’s population by encouraging the settlement of refugees. In 1671, 50 Jewish families arrived from Vienna, followed by thousands of Protestant Huguenots – many of them highly skilled – who had been expelled from France by Louis XIV in 1685. The Französischer Dom (French Cathedral) on Gendarmenmarkt serves as a tangible reminder of Huguenot influence. Between 1680 and 1710, Berlin saw its population nearly triple to 56,000, making it one of the largest cities in the Holy Roman Empire.

The Great Elector’s son, Friedrich III, was a man of great ambition, with a penchant for the arts and sciences. Together with his beloved wife, Sophie-Charlotte, he presided over a lively and intellectual court, founding the Academy of Arts in 1696 and the Academy of Sciences in 1700. One year later, he advanced his career by promoting himself to King Friedrich I (elector 1688–1701, king 1701–13) of Prussia, making Berlin a royal residence and the capital of the new state of Brandenburg-Prussia.

The Age of Prussia

All cultural and intellectual life screeched to a halt under Friedrich’s son, Friedrich Wilhelm I (r 1713–40), who laid the groundwork for Prussian military might. Soldiers were this king’s main obsession and he dedicated much of his life to building an army of 80,000, partly by instituting the draft (highly unpopular even then, and eventually repealed) and persuading his fellow rulers to trade him men for treasure. History quite appropriately knows him as the Soldatenkönig (soldier king).

Ironically these soldiers didn’t see action until his son and successor Friedrich II (aka Frederick the Great; r 1740–86) came to power. Friedrich fought tooth and nail for two decades to wrest Silesia (in today’s Poland) from Austria and Saxony. When not busy on the battlefield, ‘Old Fritz’, as he was also called, sought greatness through building. His Forum Fridericianum, a grand architectural master plan for Unter den Linden, although never completed, gave Berlin the Staatsoper Unter den Linden (State Opera House); Sankt-Hedwigs-Kathedrale, a former palace now housing the Humboldt Universität (Humboldt University); and other major attractions.

Fredrich also embraced the ideas of the Enlightenment, abolishing torture, guaranteeing religious freedom and introducing legal reforms. With some of the leading thinkers in town (Moses Mendelssohn, Voltaire and Gotthold Ephraim Lessing among them), Berlin blossomed into a great cultural capital that came to be known as ‘Athens on the Spree’.

Napoleon & Reforms

Old Fritz’ death sent Prussia into a downward spiral, culminating in a serious trouncing of its army by Napoleon at Jena-Auerstedt in 1806. The French marched triumphantly into Berlin on 27 October and left two years later, their coffers bursting with loot. Among the pint-sized conqueror’s favourite souvenirs was the Quadriga sculpture from atop the Brandenburg Gate.

The post-Napoleonic period saw Berlin caught up in the reform movement sweeping through Europe. Public servants, academics and merchants now questioned the right of the nobility to rule. Friedrich Wilhelm III (r 1797–1840) instituted a few token reforms (easing guild regulations, abolishing bonded labour and granting Jews civic equality), but meaningful constitutional reform was not forthcoming. Power continued to be concentrated in the Prussian state.

The ensuing period of political stability was paired with an intellectual flourishing in Berlin’s cafes and salons. The newly founded Universität zu Berlin (Humboldt Universität) was helmed by the philosopher Johann Gottlieb Fichte and, as it grew in status, attracted other leading thinkers of the day, including Hegel and Ranke. This was also the age of Karl Friedrich Schinkel, whose many projects – from the Neue Wache (New Guardhouse) to the Altes Museum (Old Museum) – still beautify Berlin.

Revolution(s)

The Industrial Revolution snuck up on Berliners in the second quarter of the 19th century, with companies like Siemens and Borsig vastly stimulating the city’s growth. In 1838 trains began chuffing between Berlin and Potsdam, giving birth to the Prussian railway system and spurring the foundation of more than 1000 factories, including electrical giants AEG and Siemens. In 1840 August Borsig built the world’s fastest locomotive, besting even the British in a race.

Tens of thousands of people now streamed into Berlin to work in the factories, swelling the population to more than 400,000 by 1847 and bringing the city’s infrastructure close to collapse. A year later, due to social volatility and restricted freedoms, Berlin joined other German cities in a bourgeois democratic revolution. On 18 March two shots rang out during a demonstration, which then escalated into a full-fledged revolution. Barricades went up and a bloody fight ensued, leaving 183 revolutionaries and 18 soldiers dead by the time King Friedrich Wilhelm IV ordered his troops back. The dead revolutionaries are commemorated on Platz des 18 März, immediately west of the Brandenburg Gate. In a complete turnabout, the king put himself at the head of the movement and professed support for liberalism and nationalism. On 21 March, while riding to the funeral of the revolutionaries in the Volkspark Friedrichshain, he donned the red, black and gold tricolour of German unity.

An elected Prussian national assembly met on 5 May. However, disagreements between delegates from the different factions kept parliament weak and ineffective, making restoration of the monarchy child’s play for General von Wrangel, who led 13,000 Prussian soldiers who had remained faithful to the king into the city in November 1848. Ever the opportunist, the king quickly switched sides again, dissolved the parliament and proposed his own constitution while insisting on maintaining supreme power. The revolution was dead. Many of its participants fled into exile.

Bismarck & the Birth of an Empire

When Friedrich Wilhelm IV suffered a stroke in 1857, his brother Wilhelm became first regent and then, in 1861, King Wilhelm I (r 1861–88). Unlike his brother, Wilhelm had his finger on the pulse of the times and was not averse to progress. One of his key moves was to appoint Otto von Bismarck as Prussian prime minister in 1862.

Bismarck’s glorious ambition was the creation of a unified Germany with Prussia at the helm. An old-guard militarist, he used intricate diplomacy and a series of wars with neighbouring Denmark and Austria to achieve his aims. By 1871 Berlin stood as the proud capital of the German Reich (empire), a bicameral, constitutional monarchy. On 18 January the Prussian king was crowned Kaiser at Versailles, with Bismarck as his ‘Iron Chancellor’.

The early years of the German empire – a period called Gründerzeit (the foundation years) – were marked by major economic growth, fuelled in part by a steady flow of French reparation payments. Hundreds of thousands of people poured into Berlin in search of work in the factories. Housing shortages were solved by building labyrinthine tenements (Mietskasernen, literally ‘rental barracks’), where entire families subsisted in tiny and poorly ventilated flats without indoor plumbing.

New political parties gave a voice to the proletariat; foremost was the Socialist Workers’ Party (SAP), the forerunner of the Sozialdemokratische Partei Deutschlands (SPD; Social Democratic Party of Germany). Founded in 1875, the SAP captured 40% of the Berlin vote just two years later. Bismarck tried to make the party illegal but eventually, under pressure from the growing and increasingly antagonistic socialist movement, he enacted Germany’s first modern social reforms, though this went against his true nature. When Wilhelm II (r 1888–1918) came to power, he wanted to extend social reform while Bismarck wanted stricter antisocialist laws. Finally, in March 1890, the Kaiser’s scalpel excised his renegade chancellor from the political scene. After that, the legacy of Bismarck’s diplomacy unravelled and a wealthy, unified and industrially powerful Germany paddled into the new century.

WWI & Revolution (Again)

The assassination of Archduke Franz Ferdinand, the heir to the Austrian throne, on 28 June 1914, triggered a series of diplomatic decisions that led to WWI, the bloodiest European conflict since the Thirty Years’ War. In Berlin and elsewhere, initial euphoria and faith in a quick victory soon gave way to despair as casualties piled up in the battlefield trenches and stomachs grumbled on the home front. When peace came with defeat in 1918, it also ended domestic stability, ushering in a period of turmoil and violence.

On 9 November 1918, Kaiser Wilhelm II abdicated, bringing an inglorious end to the monarchy and 500 years of Hohenzollern rule. Power was transferred to the SPD, the largest party in the Reichstag, and its leader, Friedrich Ebert. Shortly after the Kaiser’s exit, prominent SPD member Philipp Scheidemann stepped to a window of the Reichstag to announce the birth of the German Republic. Two hours later, Karl Liebknecht of the Spartakusbund (Spartacist League) proclaimed a socialist republic from a balcony of the royal palace on Unter den Linden. The struggle for power was on.

Founded by Liebknecht and Rosa Luxemburg, the Spartacist League sought to establish a left-wing, Marxist-style government; by year’s end it had merged with other radical groups into the German Communist Party. The SPD’s goal, meanwhile, was to establish a parliamentary democracy.

Supporters of the SPD and the Spartacist League took their rivalry to the streets, culminating in the Spartacist Revolt of early January 1919. On the orders of Ebert, government forces quickly quashed the uprising. Liebknecht and Luxemburg were arrested and murdered en route to prison by Freikorps soldiers (right-leaning war volunteers); their bodies were dumped in the Landwehrkanal.

The Weimar Republic

In July 1919 the federalist constitution of the fledgling republic – Germany’s first serious experiment with democracy – was adopted in the town of Weimar, where the constituent assembly had sought refuge from the chaos of Berlin. It gave women the vote and established basic human rights, but it also gave the chancellor the right to rule by decree – a concession that would later prove critical in Hitler’s rise to power.

The so-called Weimar Republic (1920–33) was governed by a coalition of left and centre parties, headed by Friedrich Ebert of the SPD and, later, independent Paul von Hindenburg. The SPD remained Germany’s largest party until 1932. The republic, however, pleased neither communists nor monarchists. Trouble erupted as early as March 1920 when right-wing militants led by Wolfgang Kapp forcibly occupied the government quarter in Berlin. The government fled to Dresden, and in Berlin a general strike soon brought the ‘Kapp Putsch’ to a collapse.

The Golden Twenties

The giant metropolis of Berlin as we know it today was forged in 1920 from the region’s many independent towns and villages (Charlottenburg, Schöneberg, Spandau etc), making Berlin one of the world’s largest cities, with around 3.8 million inhabitants.

Otherwise, the 1920s began as anything but golden, marked by the humiliation of a lost war, social and political instability, hyperinflation, hunger and disease. Around 235,000 Berliners were unemployed, and strikes, demonstrations and riots became nearly everyday occurrences. Economic stability gradually returned after a new currency, the Rentenmark, was introduced in 1923 and with the Dawes Plan in 1924, which limited the crippling reparation payments imposed on Germany after WWI.

Berliners responded like there was no tomorrow and made their city as much a den of decadence as it was a cauldron of creativity (not unlike today…). Cabaret, Dada and jazz flourished. Pleasure pits popped up everywhere, turning the city into a ‘sextropolis’ of Dionysian dimensions. Bursting with energy, it became a laboratory for anything new and modern, drawing giants of architecture (Bruno Taut, Martin Wagner, Hans Scharoun and Walter Gropius), fine arts (George Grosz, Max Beckmann and Lovis Corinth) and literature (Bertolt Brecht, Kurt Tucholsky, WH Auden and Christopher Isherwood).

The fun came to an instant end when the US stock market crashed in 1929, plunging the world into economic depression. Within weeks, half a million Berliners were jobless, and riots and demonstrations again ruled the streets. The volatile, increasingly polarised political climate led to clashes between communists and members of a party that had been patiently waiting in the wings – the Nationalsozialistische Deutsche Arbeiterpartei (National Socialist German Workers’ Party, NSDAP, or Nazi Party), led by a failed Austrian artist and WWI corporal named Adolf Hitler. Soon jackboots, brown shirts, oppression and fear would dominate daily life in Germany.

Hitler’s Rise to Power

The Weimar government’s inability to improve conditions during the Depression spurred the popularity of Hitler’s NSDAP, which gained 18% of the national vote in the 1930 elections. In the 1932 presidential election, Hitler challenged Hindenburg and won 37% of the second-round vote. A year later, on 30 January 1933, faced with failed economic reforms and persuasive right-wing advisers, Hindenburg appointed Hitler chancellor. That evening, NSDAP celebrated its rise to power with a torchlit procession through the Brandenburg Gate. Not everyone cheered. Observing the scene from his Pariser Platz home, artist Max Liebermann famously commented: ‘I couldn’t possibly eat as much as I would like to puke’.

As chancellor, Hitler moved quickly to consolidate absolute power and turn the nation’s democracy into a one-party dictatorship. The Reichstag fire in March 1933 gave him the opportunity to request temporary emergency powers to arrest communists and liberal opponents and push through his proposed Enabling Law, allowing him to decree laws and change the constitution without consulting parliament. When Hindenburg died a year later, Hitler fused the offices of president and chancellor to become Führer of the Third Reich.

Nazi Berlin

The rise of the Nazis had instant, far-reaching consequences for the entire population. Within three months of Hitler’s power grab, all non-Nazi parties, organisations and labour unions ceased to exist. Political opponents, intellectuals and artists were rounded up and detained without trial; many went underground or into exile. There was a burgeoning culture of terror and denunciation, and the terrorisation of Jews started to escalate.

Hitler’s brown-shirted Nazi state police, the Sturmabteilung (SA), pursued opponents, arresting, torturing and murdering people in improvised concentration camps, such as the one in the Wasserturm in Prenzlauer Berg. North of Berlin, construction began on Sachsenhausen concentration camp. During the so-called Köpenicker Blutwoche (Bloody Week) in June 1933, around 90 people were murdered. On 10 May, right-wing students burned ‘un-German’ books on Bebelplatz, prompting countless intellectuals and artists to rush into exile.

Jewish Persecution

Jews were a Nazi target from the start. In April 1933 Joseph Goebbels, Gauleiter (district leader) of Berlin and head of the well-oiled Ministry of Propaganda, announced a boycott of Jewish businesses. Soon after, Jews were expelled from public service and banned from many professions, trades and industries. The Nuremberg Laws of 1935 deprived ‘non-Aryans’ of German citizenship and many other rights.

The international community, meanwhile, turned a blind eye to the situation in Germany, perhaps because many leaders were keen to see some order restored to the country after decades of political upheaval. Hitler’s success at stabilising the shaky economy – largely by pumping public money into employment programs – was widely admired. The 1936 Olympic summer games in Berlin were a PR triumph, as Hitler launched a charm offensive. Terror and persecution resumed soon after the closing ceremony.

For Jews, the horror escalated on 9 November 1938, with the Reichspogromnacht (often called Kristallnacht, or Night of Broken Glass). Using the assassination of a German consular official by a Polish Jew in Paris as a pretext, Nazi thugs desecrated, burned and demolished synagogues and Jewish cemeteries, property and businesses across the country. Jews had begun to emigrate after 1933, but this event set off a stampede.

The fate of those Jews who stayed behind deteriorated after the outbreak of WWII in 1939. At Hitler’s request, a conference in January 1942 in Berlin’s Wannsee came up with the Endlösung (Final Solution): the systematic, bureaucratic and meticulously documented annihilation of European Jews. Sinti and Roma, political opponents, priests, homosexuals and habitual criminals were targeted as well. Of the roughly seven million people who were sent to concentration camps, only 500,000 survived.

WWII & the Battle of Berlin

WWII began on 1 September 1939 with the Nazi attack on Poland. Although France and Britain declared war on Germany two days later, this could not prevent the quick defeat of Poland, Belgium, the Netherlands and France. Other countries, including Denmark and Norway, were also soon brought into the Nazi fold.

In June 1941 Germany broke its nonaggression pact with Stalin by attacking the USSR. Though successful at first, Operation Barbarossa quickly ran into problems, culminating in defeat at Stalingrad (today Volgograd) the following winter, forcing the Germans to retreat.

With the Normandy invasion of June 1944, Allied troops arrived in formidable force on the European mainland, supported by unrelenting air raids on Berlin and most other German cities. The final Battle of Berlin began in mid-April 1945. More than 1.5 million Soviet soldiers barrelled towards the capital from the east, reaching Berlin on 21 April and encircling it on 25 April. Two days later they were in the city centre, fighting running street battles with the remaining troops, many of them boys and elderly men. On 30 April the fighting reached the government quarter where Hitler was ensconced in his bunker behind the chancellery, with his long-time mistress Eva Braun, whom he’d married just a day earlier. Finally accepting the inevitability of defeat, Hitler shot himself that afternoon; his wife swallowed a cyanide pill. As their bodies were burned in the chancellery courtyard, Red Army soldiers raised the Soviet flag above the Reichstag.

Defeat & Aftermath

The Battle of Berlin ended on 2 May with the unconditional surrender of Helmuth Weidling, the commander of the Berlin Defence Area, to General Vasily Chuikov of the Soviet army. Peace was signed at the US military headquarters in Reims (France) and at the Soviet military headquarters in Berlin-Karlshorst, now a German-Soviet history museum (Deutsch-Russisches Museum Berlin-Karlshorst). On 8 May 1945, WWII in Europe officially came to an end.

The fighting had taken an enormous toll on Berlin and its people. Entire neighbourhoods lay in smouldering rubble and at least 125,000 Berliners had lost their lives. With around one million women and children evacuated, only 2.8 million people were left in the city in May 1945 (compared to 4.3 million in 1939), two-thirds of them women. It fell to them to start clearing up the 25 million tonnes of rubble, earning them the name Trümmerfrauen (rubble women). In fact, many of Berlin’s modest hills are actually Trümmerberge (rubble mountains), built from wartime debris and reborn as parks and recreational areas. The best known are the Teufelsberg in the Grunewald and Mont Klamott in the Volkspark Friedrichshain.

Some small triumphs came quickly: U-Bahn service resumed on 14 May 1945, newspaper printing presses began rolling again on 15 May, and the Berliner Philharmoniker orchestra gave its first postwar concert on 26 May.

Occupation

At the Yalta Conference in February 1945, Winston Churchill, Franklin D Roosevelt and Joseph Stalin agreed to carve up Germany and Berlin into four zones of occupation controlled by Britain, the USA, the USSR and France. By July 1945, Stalin, Clement Attlee (who replaced Churchill after a surprise election win) and Roosevelt’s successor, Harry S Truman, were at the table in Schloss Cecilienhof in Potsdam to hammer out the details.

Berlin was sliced up into 20 administrative areas. The British sector encompassed Charlottenburg, Tiergarten and Spandau; the French got Wedding and Reinickendorf; and the US was in charge of Zehlendorf, Steglitz, Wilmersdorf, Tempelhof, Kreuzberg and Neukölln. All these districts later formed West Berlin. The Soviets held on to eight districts in the east, including Mitte, Prenzlauer Berg, Friedrichshain, Treptow and Köpenick, which would later become East Berlin. The Soviets also occupied the land surrounding Berlin, leaving West Berlin completely encircled by territories under Soviet control.

The Big Chill

Friction between the Western Allies and the Soviets quickly emerged. For the Western Allies, a main priority was to help Germany get back on its feet by kick-starting the devastated economy. The Soviets, though, insisted on massive reparations and began brutalising and exploiting their own zone of occupation. Tens of thousands of able-bodied men and POWs ended up in labour camps deep in the Soviet Union. In the Allied zones, meanwhile, democracy was beginning to take root, and Germany elected state parliaments in 1946–47.

The showdown came in June 1948 when the Allies introduced the Deutschmark in their zones. The USSR regarded this as a breach of the Potsdam Agreement, under which the powers had agreed to treat Germany as one economic zone. The Soviets issued their own currency, the Ostmark, and promptly announced a full-scale economic blockade of West Berlin. The Allies responded with the remarkable Berlin Airlift.

Two German States

In 1949 the division of Germany – and Berlin – was formalised. The western zones evolved into the Bundesrepublik Deutschland (BRD, Federal Republic of Germany or FRG) with Konrad Adenauer as its first chancellor and Bonn, on the Rhine River, as its capital. An American economic aid package dubbed the Marshall Plan created the basis for West Germany’s Wirtschaftswunder (economic miracle), which saw the economy grow at an average of 8% per year between 1951 and 1961. The recovery was largely engineered by economics minister Ludwig Erhard, who dealt with an acute labour shortage by inviting about 2.3 million foreign workers, mainly from Turkey, Yugoslavia and Italy, to Germany, thereby laying the foundation for today’s multicultural society.

The Soviet zone, meanwhile, grew into the Deutsche Demokratische Republik (DDR, German Democratic Republic or GDR), making East Berlin its capital and Wilhelm Pieck its first president. From the outset, though, the Sozialistische Einheitspartei Deutschlands (SED, Socialist Unity Party of Germany), led by Walter Ulbricht, dominated economic, judicial and security policy. In order to counter any opposition, the Ministry for State Security, or Stasi, was established in 1950, with its headquarters based in Lichtenberg (now the Stasimuseum). Regime opponents were incarcerated at the supersecret Gedenkstätte Hohenschönhausen (Stasi Prison) nearby.

Economically, East Germany stagnated, in large part because of the Soviets’ continued policy of asset stripping and reparation payments. Stalin’s death in 1953 raised hopes for reform but only spurred the GDR government to raise production goals even higher. Smouldering discontent erupted in violence on 17 June 1953 when 10% of GDR workers took to the streets. Soviet troops quashed the uprising, with scores of deaths and the arrest of about 1200 people.

The Wall Goes Up

Through the 1950s the economic gulf between the two Germanys widened, prompting hundreds of thousands of East Berliners to seek a future in the West. Eventually, the exodus of mostly young and well-educated East Germans strained the troubled GDR economy so much that – with Soviet consent – its government built a wall to keep them in. Construction of the Berlin Wall, the Cold War’s most potent symbol, began on the night of 13 August 1961.

This stealthy act left Berliners stunned. Formal protests from the Western Allies, as well as massive demonstrations in West Berlin, were ignored. Tense times followed. In October 1961, US and Soviet tanks faced off at Checkpoint Charlie, pushing to the brink of war.

The appointment of Erich Honecker (1912–94) as leader of East Germany in 1971 opened the way for rapprochement with the West and enhanced international acceptance of the GDR. In September that year the Western Allies and the Soviet Union signed a new Four Power Accord in the Kammergericht (courthouse) in Schöneberg. It guaranteed access to West Berlin from West Germany and eased travel restrictions between East and West Berlin. The accord paved the way for the Basic Treaty, signed a year later, in which the two countries recognised each other’s sovereignty and borders and committed to setting up ‘permanent missions’ in Bonn and East Berlin, respectively.

Life in the Divided City

For 45 years, Berlin was a political exclave in the cross hairs of the Cold War. After the Berlin Wall was built in 1961, the city's halves developed as completely separate entities.

West Berlin

West Berlin could not have survived economically without heavy subsidies from the West German government in the form of corporate tax incentives and a so-called Berlinzulage, a monthly tax-free bonus of 8% on pretax income for every working Berliner. West Berliners had access to the same aspects of capitalism as all other West Germans, including a wide range of quality consumer goods, the latest technology and imported foods. Then, as now, the main shopping spine was Kurfürstendamm and its extension, Tauentzienstrasse, the crown jewel of which, the KaDeWe department store, left no shopping desire unfulfilled.

Since West Berlin was completely surrounded by East Berlin and East Germany, its residents liked to joke that no matter in which direction you travelled, you were always ‘going east’. Still, West Berliners suffered no restrictions on travel and were free to leave and return as they pleased, as well as to choose their holiday destinations. Berlin was linked to West Germany by air, train and four transit roads, which were normal autobahns or highways also used by East Germans. Transit travellers were not allowed to leave the main road. Border checks were common and often involved harassment and time-consuming searches.

East Berlin

From the outset, East Germany's economic, judicial and security policy was dominated by a single party, the SED. Among its prime objectives was the moulding of its citizens into loyal members of a new socialist society. Children as young as six years old were folded into a tight network of state-run mass organisations, and in the workplace the unions were in charge of ideological control and conformity. Officially, membership of any of these groups was voluntary, but refusing to join usually led to limits on access to higher education and career choices. It could also incite the suspicion of the much-feared Stasi.

The standard of living in East Berlin was higher than in the rest of East Germany, with the Centrum Warenhaus on Alexanderplatz (today's Galeria Kaufhof) a flagship store. While basic foods (bread, milk, butter, some produce) were cheap and plentiful, fancier foods and high-quality goods were in short supply and could often only be obtained with connections and patience. Queues outside shops were a common sight and many items were only available as so-called Bückware, meaning that they were hidden from plain view and required the sales clerk to bend (bücken) to retrieve them from beneath the counter. Bartering for goods was also common practice. Western products could only be purchased in government-run retail shops, called Intershops, and only by the privileged few who had access to hard currency – the East German mark was not accepted.

After the Wall went up in 1961, East Berliners, along with other East Germans, were only allowed to travel within the GDR and to other Eastern Bloc countries. Most holiday trips were state-subsidised and union-organised, and who was allowed to go where, when and for how long depended on such factors as an individual's productivity and level of social and political engagement. Those who could afford it could book a package holiday abroad through the Reisebüro der DDR (GDR Travel Agency).

Women enjoyed greater equality in East Germany than their western counterparts. An extensive government-run childcare system made it easier to combine motherhood and employment, and nearly 90% of all women were employed, many in such 'nontraditional' fields as engineering and construction. However, this gender equality did not necessarily translate into the private sphere, where women remained largely responsible for child-raising and domestic chores. Rising through the ranks at work or in organisations was also rare for women. In fact, the only female member of the Ministerrat (Council of Ministers) was Erich Honecker's wife, Margot Honecker.

The Wall Must Come Down

Hearts and minds in Eastern Europe had long been restless for change, but German reunification came as a surprise to the world and ushered in a new and exciting era. The so-called Wende (turning point, ie the fall of communism) came about as a gradual development that ended in a big bang – the collapse of the Berlin Wall on 9 November 1989.

The Germany of today, with 16 unified federal states, was hammered out through a volatile political debate and negotiations to end post-WWII occupation zones. The first significant step towards unification occurred on 1 July 1990 when monetary, economic and social union became realities, leading to the abolition of border controls and to the Deutschmark becoming the common currency. On 31 August of the same year, the Unification Treaty, in which both East and West pledged to create a unified Germany, was signed in the Kronprinzenpalais on Unter den Linden. Around the same time, representatives of East and West Germany and the four victorious WWII allied powers (the USSR, France, the UK and the US), who had held the right to determine Germany’s future since 1945, met in Moscow. Their negotiations resulted in the signing of the Two-Plus-Four Treaty, which ended postwar occupation zones and fully transferred sovereignty to a united Germany. Formal unification became effective on 3 October 1990, now Germany’s national holiday. In December 1990 Germany held its first unified post-WWII elections.

In 1991 a small majority (338 to 320) of members in the Bundestag (German parliament) voted in favour of moving the government to Berlin and of making Berlin the German capital once again. On 8 September 1994 the last Allied troops stationed in Berlin left the city after a festive ceremony.

The Postunification Years

With reunification, Berlin once again became the seat of government in 1999. Mega-sized construction projects such as Potsdamer Platz and the government quarter eradicated the physical scars of division but did little to improve the city's balance sheet or unemployment statistics. It didn't help that Berlin lost the hefty federal subsidies it had received during the years of division. More than 250,000 manufacturing jobs were lost between 1991 and 2006, most of them through closures of unprofitable factories in East Berlin. Add to that mismanagement, corruption, a banking scandal and excessive government spending and it's no surprise that the city ran up a whopping debt of €60 million.

Elected in 2001, the new governing mayor Klaus Wowereit responded by making across-the-board spending cuts, but with a tax base eroded by high unemployment and ever-growing welfare payments, they did little initially to get Berlin out of the poorhouse. Eventually, though, the economic restructure away from a manufacturing base and towards the service sector began to bear fruit. Job creation in the capital has outpaced that of Germany in general for almost 12 years. No German city has a greater number of business start-ups. Its export quota has risen steadily, as has its population. The health, transport and green-technology industries are growing in leaps and bounds.

On the cultural front, Berlin exploded into a hive of cultural cool with unbridled nightlife, a vibrant art scene and booming fashion and design industries. In 2006 it became part of Unesco's Creative Cities Network. Some 170,000 people are employed in the cultural sector, which generates an annual turnover of around €13 billion. An especially important subsector is music, with nearly 10% of all related companies, including Universal and MTV, moving their European headquarters to Berlin over the past 20 years.