LEIPZIG, GERMANY -- "Welcome to Leipzig" is the greeting on a massive, artless concrete block at the gateway to this gray, gritty city. Early last year, flags of Communist East Germany that had fluttered over the sign vanished. The flagpoles stood as empty testament to a city in transition.
Flags are flying once more. Now they are corporate banners, the Mercedes star and the Sixt rental car logo. New times, new symbols.
But 16 months after the East German revolution gathered steam here, and four months after the reunification of the Germanys, this "city of heroes" remains a cold, poor place where the patina of hope is thinning.
This year was supposed to be the start of eastern Germany's own Wirtschaftswunder, the postwar economic miracle that opened the huge gap between the two Germanys. Chancellor Helmut Kohl was reelected with overwhelming support from east Germans, to whom he promised a Western standard of living.
But aside from a few teenagers selling homemade pastries in the rail station or the occasional Western company opening a branch store downtown, Leipzig is stuck in a downward spiral of unemployment and collapsing industries -- all supervised by a government in its infancy. Joblessness is so widespread that city officials say they have lost count. The latest government numbers show more than 2.6 million east Germans out of work, up nearly 200,000 in one month.
Western investors are uncertain over property in eastern Germany. With millions of claims by west Germans, whose homes and businesses were nationalized by the Communists, and by Jews, whose property the Nazis seized earlier, few business people are willing to invest money in land or buildings subject to legal battles. There are 40,000 claims on 16,000 properties in Leipzig.
In addition, the Soviet Union, which a year ago was by far East Germany's largest trading partner, has said it would not be needing its 1991 orders filled.
Now the Persian Gulf War has added security concerns. Leipzig Mayor Hinrich Lehmann-Grube was all set to give a delegation of French economists and investors a pitch on the city's opportunities the other morning, only to find out that they had canceled.
Investment has slowed to a trickle as the United States and other major Western nations, distracted by the war, turn away from an east German market hungry for western cars, convenience, housing, phones -- really, anything western.
"It's all going too slowly, far too slowly," Lehmann-Grube, 59, said in his office, a jarring mix of 1960s featureless socialist furniture and Art Nouveau details that somehow survived the Communist period. "If you compare Leipzig with before the turnabout, tremendous change is evident. But the people do not compare with the past. They compare with their hopes and expectations."
On Jan. 1, east Germans suddenly faced a doubling or more of expenses for many necessities such as rent, oil and public transport, while wages went up by only 10 to 20 percent. Just a few families have escaped the impact of the collapse of eastern Germany's uncompetitive state-run industries.
Even Bonn -- criticized sharply in the West for its reluctant attitude toward the war -- has devoted much of its official energy of late to shoring up its foreign alliances, mostly by pledging billions of marks for the war effort, which many east Germans fear will come out of their reconstruction funds.
Without a burst of Western investment, places like Leipzig face the task of improving an infrastructure frozen in the 1930s with almost no tax income. The business tax is the main source of income for local governments in Germany.
"We can barely expect any income from that source," Lehmann-Grube said. "This economy is starting at zero." The mayor said the city may have to declare bankruptcy later this month.
Last week, leaders of the five east German states went to Bonn to warn of impending economic collapse if the German government does not pump in massive funds. Without subsidies from Bonn for heating, water and oil, many eastern leaders say the coming months may bring renewed civil unrest.
Across party lines, politicians in the east -- whether homegrown or imported from western Germany -- are openly disgusted with the Kohl government's pace in rebuilding the country's neglected quarter.
"My greatest worry is that we will not be able to convince the western part of Germany -- that is, the 80 percent of Germans in the West -- that the reconstruction of the eastern part of Germany is an all-German task," said Kurt Biedenkopf, the west German Christian Democrat who was elected premier of the east German state of Saxony in December. Biedenkopf threatened to sue the federal government for more support.
"I am deeply disappointed by policy makers in Bonn and their idiotic discussion of the costs of unity," said Lehmann-Grube, who left his career as city manager of Hannover in the west to go east. "The Bonn ministries feed us bureaucratic advice. What we need is money. The greater part of west German society has no sense of the dimension of this task -- something that can only be compared with the two world wars."
A poll by Der Spiegel newsmagazine found 86 percent of eastern respondents felt like second-class citizens in the reunited country.
"The people here are under terrible stress," Leipzig's mayor said. "A whole society with all its connections -- a society far more complicated than any of us realized -- everything here is new."
Pioneers from the west like Lehmann-Grube are still relatively rare in the east. And few east Germans have the education, experience or capital to dive into the marketplace.
So, more often than most Germans would like, the people who end up managing the transition -- in government and business alike -- are familiar faces, old Communists whose continuing presence is a powerful psychological blow to many east Germans who had dreamed of a clean sweep.
"In many old industries, the general director from the Communist days is gone, but the next level -- all of whom were party members -- is still there," Lehmann-Grube said.
Leipzig's government has thrown out nearly all of its old Communist cadre, but each personnel move is a major political battle. At the last meeting of the city council, the 128-member body spent more than an hour debating the mayor's appointment of a single member of the fire brigade who had been a party member.
"Many people would rather accept bad professional quality than someone from the old regime," the mayor said.
This time, Lehmann-Grube got his appointment through. But tomorrow there will be another battle, as there is every day in a city whose people are torn between gratitude for being rid of six decades of oppression and resentment over the painfully slow transition to a new life.