Since Iron Curtain Fell, East Germany Has Been Crumbling : Eastern Europe: The government seems powerless and the economy has been plummeting. Thousands of citizens go west daily.

Barely four months ago, the East Germans were basking in the glory of having carried off the first successful German revolution.

It has been mostly downhill since.

In all of East Europe, no one took communism more seriously than the East Germans, and no one has lost more as a result of its fall. Today, the caretaker government in East Berlin seems powerless, the economy has gone into a tailspin and key institutions such as the army, once the Warsaw Pact’s finest, have simply come unstuck.

Amid the confusion, East Germany is losing its very lifeblood, its young people, who continue to give up and head west at a rate of 2,000 to 3,000 a day. It is the need to resolve these problems and keep East Germany economically viable that has forced the pace of reunification.

East Germans look on almost helplessly as the fabric of their community unravels and Western experts forecast the imminent collapse of their economy. It is an unsettling experience.

Hans Huhnholz, a sound technician at East Germany’s state-owned radio station in East Berlin, hunched over a cup of coffee the other day and ran down a list: “If you want the doctor, he’s gone; if you need new heels for your boots, the repairman’s gone; if you need a haircut, the barber’s gone.

“It’s gotten so I hesitate to look people up,” he said.

Officials in West Berlin say they have already taken responsibility for collecting part of East Berlin’s garbage and are prepared to help with other essential services--public safety, firefighting, transportation--if the manpower shortage persists.

“Their problems very quickly become ours,” Klaus Hetzer, a West Berlin spokesman, said, referring to the flood of refugees.

East German industry is so tightly integrated and has so few duplicate suppliers that a manpower shortage at one plant can have a domino effect throughout an industry.

In a country where basic data have been either suspect or state secrets, no one knows the exact state of the economy that six months ago was considered the healthiest in East Europe. But economists in West Germany estimate that it is declining at an annual rate of 6% to 10%.

Shops are closed in many East German cities and towns, and signs are posted advising that this is because of vacations or illness. In many cases, this is not so much a lie as a euphemism disguising a harsher truth, the flight to the West.

For older East Germans with deep roots, this exodus is hard to understand.

“They are just kids who haven’t thought through what they are doing,” Joachim Mueller, a gray-haired municipal employee, told an interviewer. “All they want is to experience something new.”

But it is much more than that. For a people accustomed to being steered through a secure if drab existence dictated by central planners and five-year plans, the sudden uncertainty is a shock.

Here in Luebbenau, a mining town of 22,000 about 50 miles south of Berlin, people worry that the town’s two main employers, an open-pit coal mine and a power plant, may have to close. Neither is efficient, and both are major polluters.

In Dresden, Joerg Marschner, co-editor of the city’s largest newspaper, the Saeschische Zeitung, said factory managers in the area estimated recently that a third of all East German industrial enterprises could face bankruptcy if the two German currencies are merged. Officials of the two Germanys are already talking about a currency union, and there is fear in East Germany that savings in the much weaker ostmark could be virtually wiped out.

Reports that West Germans may try to reclaim houses in East Germany that were confiscated by the Communists in the 1950s have raised questions about the security of property.

Disclosures of widespread official corruption have fostered disillusionment and anger, effectively cutting East Germans adrift from their social moorings.

It is not just that former Communist boss Erich Honecker is suspected of amassing a personal fortune, or that so many party officials have had to resign. It is the pervasive nature of it--that the much-prized East German sportwunder was built on illegal steroids, that Berlin’s powerful Dynamo soccer team won the national championship 10 years running because former State Security chief Erich Mielke wanted it that way and referees around the league knew it.

All this has been a crushing psychological blow for a people who for years had accepted a living standard below that of their West German cousins in the belief that they were part of a morally superior society.

A reader recently asked an East Berlin paper, the Berliner Zeitung, what had happened to all she had been taught about her country in school, and the paper replied: “The working class never had any real power. It just served as a facade for the Communist Party elite to exercise its will.”

Sieginde Seeliger, Luebbenau’s city manager, observed the other day: “We lived for 40 years in this mess and knew nothing. Then suddenly it all comes out. It’s terribly disturbing.”

The East German army is said to be plagued by desertions. Military discipline has plummeted. An American recently overheard an officer complaining that his men no longer even bother to stand up when he walks into the room.

On Army Day this week, fewer than 50 visitors turned up at a military base in Leipzig for the annual open house that in past years attracted as many as 5,000.

Luebbenau’s Seeliger noted that factory workers in the town had stopped doing volunteer work for the community. “There just isn’t the spirit any more,” she said.

The city’s mayor and other senior party officials have left for jobs elsewhere, apparently to avoid sensitive questions about their administration. Little is getting done, and later this month Seeliger plans to go to West Germany to learn how to administer a town no longer run by a party apparatus.

Still, some people see benefits.

Bricklayer Gerd Becker went through a list of people he knew who had fled to the West, paused, smiled and said:

“At least it’s helping with the housing shortage.”