In Germany, the year 1945 was referred to as year zero. Many towns were in ruins and people resorted to stealing food to survive. In a plan that the allies had made before the war ended, they had planned to let Germans have one-thousand two-hundred calories a day, an astonishingly low amount. The plan was leaked to the press however and people were outraged at the severity of the plan so it did not really go through. The allied forces were occupying Germany and controlling the German economy. The German Mark had been so inflated that it was essentially worthless and attempts to employ an allied scrip also failed. Instead, a cigarette economy took hold where people used tobacco as currency. This state of year zero continued into 1947.
Ludwig Erhard had managed in 1946 to get the general in control of Bavaria to remove some of the economic control and this resulted in great results. After this Erhard went to Lucius Clay, the military governor of Germany, and asked him to remove all economic restrictions. Lucius Clay had already been thinking about how to improve the situation for the German people so he agreed to this plan. They also decided to instate a new currency, the Deutschemark, in 1948. The day after the new currency had been instated the stores had goods in them. This was because if the storekeepers had saved anything or had received a shipment of goods, they were not willing to sell their goods for a worthless currency. After these reforms had been made, which became known as the “Economic Miracle,” the situation in Germany was vastly improved. The rubble was cleaned up and industrial output rose as well as the standard of living. While the Marshal plan helped Germany somewhat, the main contributor to the economic miracle was the removal of restrictions on the economy and the installment of viable currency.