When Konrad Adenauer formed West Germany's first government in September 1949, the Christian Democrats had become the principal supporters of the social market economy. During the election campaign, the CDU contrasted Erhard's social market policies with the SPD's alleged wish to reintroduce the hated Zwangswirtschaft of 1936–48. The general decline in prices and the dramatic increases in productivity since the spring appeared to signal West Germany's economic recovery. Since he introduced the free-price mechanism in June 1948, Erhard had evidently confounded his critics who had argued that shortages of raw materials, private sources of capital, and consumer goods would lead to a dangerous inflationary spiral endangering the new currency, the Deutsche Mark. Instead, prices declined and productivity, especially in consumer and manufactured goods, skyrocketed. Adenauer responded by associating himself fully with Erhard's social market philosophy. Yet, although Erhard enjoyed his greatest prestige in late 1949, stormy weather lay ahead. As he had predicted, the elimination of price controls made consumer goods widely available for the first time in many years. But already in late 1949, shortages of raw materials, especially coal, and the lack of a functioning private capital market revealed bottlenecks in the economy surmountable only by the investments of which his critics had warned. In the ensuing three years, where to find adequate sources of investment became the central question of economic policy.

Erhard never denied the problem that investment posed for his social market economy.