The Berliner Schloss as it was and will be (computer visualisation).

A quarter century after the Mauerfall, much of Berlin is still a building site. Hoardings often enthuse ‘Wir bauen um!’ ('We're rebuilding!') to an inconvenienced public, as if construction projects were never simply means, but always ends in themselves.

Over the past hundred years, Berlin's Umbau – planned and otherwise – has gone ahead with grand intentions and high explosive. The east end of Unter den Linden and the contiguous Museum Island is now one large building site, or rather a merger of two retro megaprojects: the Staatsoper refit, and the recreation from nothing of the old Berliner Schloss, which is being re-erected in more or less its original form, as if the last two-thirds of the 20th century didn't happen. The shell of the old imperial palace survived the war, but Walter Ulbricht dynamited it in 1950, and eventually the site hosted the Palast der Republik and Marx-Engels-Platz. In a bit of wilful historical whirligigging, the Palast was blown up a few years ago to make way for Schloss II, now rising on the rubble of the Marx-Engels-Platz.

Even the boxy painted hoardings screening the Schloss and Oper building sites are rendered in antique cream with astragal windows, as if straining to reel back a lost urbanity. Nearby, Schinkel's Bauakademie, bombed out in the war and replaced by the GDR foreign ministry (demolished in its turn after reunification), is also set to rise again: the exterior is shrouded in polythene sheeting printed with the red brickwork of the original façade. This wilful atavism is of a piece with the zombie dawn already in place up towards the Brandenburg Gate, where carriage-clock confections, like the Gendarmenmarkt, have been remade after getting bazookaed by the Red Army – though the effect is a bit spoiled by the galumphing ex-Soviet (now Russian) Embassy along Unter den Linden’s southern kerb.

As usual with these palingenetic exercises, the question is when exactly the clock is meant to stop. In the Humboldt-Box, a four-storey meccano prefab got up to puff the Schloss rebuild, there's a large cardboard model of the 'historic centre' of Berlin. Schloss II, officially the 'Humboldt Forum', will face the Berliner Dom, which dates only from only 1905. Overall, the likely effect, already visible further up Unter den Linden, will be Poundbury an der Spree.

More generally, the city flip-flops over its past. Every postwar (West) German schoolchild got to know the word Vergangenheitsbewältigung, or 'coming to terms with the past'. Unlike the planned Schloss, only the street frontage of the Oranienburger Strasse synagogue, burned on Kristallnacht and later bombed by the RAF, has been rebuilt. After 1989, debate raged over what to do with ex-liminal areas like Potsdamer Platz, resolved there by the vitrine stockade of the Sony building.

The resurrected Schloss has already chalked up major overruns; the conservative current estimate runs to €580 million. Getting rid of the Palast der Republik alone cost €120 million. The Schloss consortium is running a whip-round to meet the €80 million cost of the façade – one of the main rationales of the Humboldt-Box. As Bent Flyvbjerg points out in his pioneering work on megaproject inflation, politicians baulk at ceding control of pet schemes to experts, and low-ball cost estimates to blag public support. Meanwhile social housing remains scarce.

Across the river from the building site a couple of men were fishing for rudd. I asked one of them what he thought of the Wiederaufbau. ‘Ein Blödsinn,’ he said – roughly, 'daft crap'. And he dispatched the rudd wriggling in his hand with a deft flick to the back of its head.