How unified Germany screwed hundreds of thousands of East German refugees

We were very reluctant to use the word 'screwed' in the title of this post but after reading up on what happened to several hundred thousand East Germans who fled to the West and lived and worked there, often for many decades, we stand by the use of screwed.

If you prefer to read one of a number of articles published in the German press on the subject, we recommend this one from 2011 in Die Zeit.

A single sentence explanation for our harsh statement:
After German unification in 1990, many former East German refugees saw their social security pension drop, often by as much as one third, in contrast to earlier law.

The history behind this unexpected slide in benefits sounded unbelievable, but here is how it came about.

From its inception in the late 1940s, West Germany was keen to show it was the better, the more democratic, the more socially just of the two Germanys left by World War II.

One of the cornerstones of demonstrating how great the West was the treatment of East Germans who left everything behind to start over in the West, often under life threatening circumstances. 

Social security pension contributions and eligibility were granted to the refugees as if they had worked in the West all their lives. Pensions in the West were higher than in the East, but so was the cost of living.

The West German social security administration sent out benefits statements to former East Germans, informing them that the years in the East were fully recognized under the applicable "foreign pensions eligibility law".

For example, East Germans who had fled in the 1960s and reached retirement age in 1980 began receiving the promised pension at 100% of the West German level.

After unification, everything changed, yet those former East Germans who had not yet reached retirement age in the West didn't notice. Nobody informed them that the provisions of the "foreign pensions eligibility law" had been retroactively suspended for former refugees and instead replaced with a new law meant to provide pensions to those who had never left East Germany.

All of a sudden, citizens who had signed away their East German citizenship and all rights to whatever that state promised in benefits saw their pensions recalculated according to the new formula for time worked in East Germany. Depending on how long individuals worked in East Germany before fleeing, the losses often end up to be one third of projected benefits, taking people like a registered nurse acquaintance of the blogster to a pension below the poverty level after 40 years of work.

And the courts?

The courts sided with the new interpretation while government is in no hurry to speed up the plans to achieve pension equality between the former East and the former West by 2019, almost 30 years after re-unification.

Of course, you can always find worse, as reported on NPR news only minutes ago in a piece about Brazil. To this day, 500 years after the Portuguese made all land in the country theirs, many Brazilians still have to pay property transaction taxes to the descendants of Portuguese nobles who were awarded the rights to collect rent on real estate by the Portuguese crown.