Going Up in Smoke: When Billions Were burnt in Communist Banknotes
If you ask Hans-Joachim Buettner, formerly an officer in East Germany’s communist forces, what he associates with July 1, he says, “That’s when I’ll turn 70.” No. What else? “It used to be Day of the People’s Police,” he says with a grin. What else? He shakes his head.
On July 1, 1990, East Germany demonetised its currency, and thereby hangs a tale. Buettner was given a most unusual job to do: getting rid of the old money.
East Germany and West Germany had announced a currency union where the East German ‘mark’ would cease to be legal tender as a preliminary to German reunification later the same year.
The East German mark, which had always been a “funny money”, was replaced by one of the world’s hardest currencies, the West German Deutschmark. East Germans handed in their cash at banks to exchange it for new money up to a fixed per-person maximum. The old notes and coins became worthless on currency-union day.
How much money was it? No one knows for sure; it amounted to many tonnes of paper and untold billions of marks in terms of face value.
East Berlin decided the cheapest way to eliminate all the useless notes would be to bury them in a underground military bunker near the city of Halberstadt that was about to be decommissioned anyway. Buettner was the last commander of that bunker. The idea was that the paper, over time, would rot underground in this graveyard for the East German state’s worthless paper wealth.
Now a retiree, Buettner shows a visitor around the bunker with a flashlight.
Back in 1944, Jewish and other inmates from the Langenstein-Zwieberge concentration camp were forced to build 13 km of tunnels where Nazi Germany aimed to set up an impregnable factory to produce airplane components. Later it became an East German military facility.
The beam of Buettner’s flashlight runs over huge piles of sand. “They drilled holes from above into the ceiling of the tunnel and then poured water and sand down,” the former lieutenant-colonel says. “It was meant to cover up the paper money and help it to rot away better. But we knew it wouldn’t work that way.”
”The money in 1990 was brought here in burlap bags,” the former officer adds, recalling the bags’ precise measurements: “60 centimetres tall, 30 centimetres wide, 20 centimetres thick.”
Buettner was the officer who had sat down at the time with State Bank officials to plan the operation. All they were concerned about at the time were logistics, security and secrecy.
“The fact is, it all had to happen quickly. The (eastern German) bank vaults had to be emptied to make space for the Deutschmarks,” he says. Buettner pulls out some old plans of the bunker complex.
”The initial consignment of money had been East Germany’s emergency reserves. This arrived here by train,” he says, and then with a ballpoint pen traces the rail siding that leads into the bunker. “They went completely below ground and were unloaded here.” Later, money shipments came on dump trucks, he says, his ballpoint pen again tracing a line on the map of the complex.
Wooden pallets loaded with the burlap sacks were taken by forklift trucks to 20 conveyor belts, where the sacks were unloaded by hand. The sacks were stacked up nearly to the top of the 9-metre-high arched ceilings of the bunker.
“There were always bank people observing ... to keep an eye on things,” Buettner says. The total operation took nearly 18 months to complete. The GDR money was stored in two shafts. Then came the sand poured on top.
The cash could not be changed into any other currency, but among all the notes were new 200- and 500-mark bills that had never been brought into circulation. Collectors were eager for these rarities.
Although the operation was supposed to be kept secret, word got out about the vast sums of old money down below, luring a thieves. Two thieves who were caught went on trial in a Halberstadt court in 2002 and were given suspended prison sentences.
After the thefts, the German Bank for Reconstruction, as the legal successor to the East German State Bank, ordered the notes, roughly estimated at 100 billion marks in face value, removed from the bunkers and burned in a trash incineration plant.
Even though all the money has been removed, the bunker remains a magnet for treasure-hunters to this day. Graffiti smeared on the walls and empty liquor bottles attest to many expeditions inside.
”They are always breaking in, over and over,” says Buettner, who lives in Halberstadt and keeps a leased parcel of land for hunting.
At the surface above the bunker, the land is derelict. Halberstadt mayor Andreas Henke says, “We hope to find some use for the area in the future, something in harmony with nature. But there are legal problems. It’s going to take some time to wait out foreclosure proceedings to get complete legal control of the land.”