On February 4, 1897, Ludwig Wilhelm Erhard was born. He would become one of the most impactful politicians in Germany’s post-war era. He may be less well-known than his counterparts outside Germany, but Erhard’s political impact shaped the future of the country’s economy forever. This short article is my gift to Erhard for his 126th birthday and a symbol of my appreciation.

Today, Erhard is considered the main architect behind West Germany’s Wirtschaftswunder (German for “economic miracle”) and the father of the social market economy. An academic turned politician, he was Minister for Economic Affairs under Konrad Adenauer from 1949 to 1963 and Chancellor from 1963 to 1966; he would remain a member of the German parliament till his death in 1977.

He could be seen as an ideologue. He fought for his ideals, which, in the world of politics, caused him problems with his colleagues more than once. However, he stayed faithful to what he believed in and put his principles over party politics. After World War II, the CDU would campaign with slogans like “We want to overcome Marxism and Capitalism.” In just a couple of years, Erhard would completely change the positions of the party—without even being a member. Today, Erhard is still the only independent Chancellor in Germany’s history.

After World War II, the country was in ruins, not only infrastructure-wise but also economically. Price controls on goods and services led to black markets and shortages, high unemployment and a worthless currency made life quite harsh. Ludwig Erhard, who was the head of the Institute of Industrial Research between 1942 and 1945, was chosen by the Americans to become Bavaria’s first post-war Finance Minister. Before long, he won over the Allies and was entrusted with a major task: mapping out currency reform. Erhard wanted to introduce further changes together with the currency reform; the Allies, however, were not fond of permitting such abrupt changes to take place. Erhard pushed through, and the reform took place in 1948.

The much-needed reform reduced the amount of currency available by 93 percent and was accompanied by considerable tax cuts. Against the Allies' will, Erhard also eliminated price controls and established monopoly controls at the same time. The radical reform freed almost all goods—from vegetables to manufactured goods—from price controls and gave birth to the Deutsche Mark. Erhard had just de-nazified the economy.

One year later, Erhard would become the German Minister of Economic Affairs. While Erhard’s reform paved the path for the Wirtschaftswunder, he wasn’t alone. A number of academics provided the blueprint for what we know today as the social market economy. Erhard and his secretary of state, Alfred Müller-Armack, would base their actions on the works of the so-called Freiburg School.

Academics like Walter Eucken, Franz Böhm, Wilhelm Röpke, and Alexander Rüstow would bring forward the German version of Neoliberalism: Ordoliberalism. Ordoliberalism advocates for free-market capitalism while, at the same time, allowing the government to play a role in preventing monopolies and setting up a social welfare system.

The economic growth would continue over the years. Just a decade later, West Germany’s industrial production was already four times higher than in 1948. Throughout the 1950s and 1960s, the country saw 25 years of continuous growth without stagnation or contraction. With economic growth of around eight percent, low unemployment, low price increases, and increasing real wages, Germans witnessed a level of stability never seen before. Prosperity reached not only the upper classes, but the entire population got a piece of the increasing wealth. With the consumer at the center, better and cheaper products were produced. Made in Germany meant something again.

Erhard was quite clear in his position: the economy needed to be liberated from the state. It was the individual choices of consumers and their interests that drove the market process to efficiency and prosperity—the consumer became king, not central planners at government bureaus. State intervention should be limited to a minimum.

New companies could enter the market process without big barriers, and less profitable companies had to leave it. Monopoly control prevented too many big actors, and consumers benefited from competition. For Erhard, “prosperity for all” was closely linked to “prosperity through competition." Erhard was sure that the dangers of free-market competition were constant; therefore, they needed to be defended constantly.

However, after Erhard left office, questions about the role of the social aspect in the social market economy arose. Many politicians (including CDU ones) argued for a larger social role for the government and advocated for more state intervention in the welfare system and the economy, arguing that the social component of Erhard’s legacy needed an update. In 1974, Erhard himself claimed the era of the Wirtschaftswunder had ended and that the social market economy was long gone. To him, the new policies and reforms had nothing to do with the principles of individual responsibility and freedom for which he fought so vigorously.

Today, almost 60 years after Erhard’s chancellery, the term social market economy has become an empty buzzword among politicians. Intervention from the European Union and an expansive monetary policy undermine the core principles of Erhard’s reforms. Maybe it is time for the Freiburg School to make a comeback—this time not only in Germany but in the EU, too.

This article was written by Juan De Dios Estevez. Juan is a writer based in Germany and a fellow with Young Voices Europe. Born and raised in Bolivia, he is a campus ambassador with the Foundation for Economic Education, a Young Affiliate at the Network for Constitutional Economics, and an editor of the student magazine, Der Freydenker. He is an ambassador of the Free Cities Foundation and currently holds a scholarship from the Friedrich Naumann Foundation for Freedom.