East Germany’s failed attempt to build a computer industry through espionage reveals why authoritarian regimes struggle with innovation.
Introduction
Can authoritarianism—or fascism—succeed in the long run?
I’m skeptical. For many reasons. But one of them comes from a lesson East Germany taught us in its attempt to build a computer industry.
The Reality of Economic Espionage
Economic espionage is the least glamorous form of spying in fiction, but in real life, it’s probably the most common. States routinely go after the intellectual property of other countries and corporations. And corporations spy on each other too.
The motivations are clear: access to trade secrets, R&D, or proprietary data can offer a competitive edge, help forecast market shifts, or bolster internal capabilities. But economic espionage alone doesn’t create a successful industry.
East Germany’s Espionage Experiment
Years ago, I read a book on the economic espionage conducted by East Germany. The country wanted to build its own computer industry. But decades of Soviet exploitation had stripped much of its industrial base. Add to that the brain drain caused by the division of Germany, and by the 1960s, East Germany was far behind the West in technology.
With Western tech under embargo, the Stasi launched an enormous espionage operation. They stole everything they could—blueprints, technical manuals, volumes of documentation. Eventually, they had enough to start building computers.
Why Espionage Couldn’t Build an Industry
Was it a success?
No. And here’s why.
When the East Germans inevitably hit development problems—and there are always problems—they couldn’t solve them. Stolen technology doesn’t come with a help desk. And because they hadn’t developed the tech themselves, they had no engineers who’d failed repeatedly and learned from it. No one with the deep knowledge needed to troubleshoot or improve.
Worse still, they lacked a social and educational system that nurtured innovation. Their schools didn’t encourage creativity, critical thinking, or collaboration. There was no rising generation prepared to carry the industry forward.
The result? Failure.
Innovation Requires Freedom
East Germany’s computer industry floundered. In the end, they likely spent more on espionage than they would have spent developing the technology from scratch. But true development would have required a culture that supported open inquiry and knowledge-sharing—something their ideology couldn’t allow.
That’s why I’m deeply skeptical of the idea that an authoritarian or fascist regime can produce a truly innovative society. Innovation needs freedom. Full stop.
Further Reading: Seduced by Secrets
Read this: Seduced by Secrets: Inside the Stasi’s Spy-Tech World by Kristie Macrakis is an academic and technical read—not for everyone—but a fascinating deep dive for those curious about how espionage outputs are reintegrated into the systems that collect them.
If you’re interested in the machinery behind spy craft and how stolen secrets shaped East Germany’s technological ambitions, it’s an illuminating and worthwhile study.