How far did the Nazis control the economy in the years 1933-45?

The recovery of the economy 1933-36

During their rise to power, the Nazis promised to recover Germany from their economic crisis as soon as possible. Reparations were no longer a problem as in 1932 Bruning told the Allies that Germany wouldn't be able to pay them. However, the issue of debt from foreign borrowing in the 1920s still remained. In 1934 Germany failed to give their payment and trade with the US collapsed. This wasn't an issue for the Nazis as they had no intention on relying on foreign trade. Schacht had draw up a 'new plan' which involved trading goods rather than paying for imports with countries such as Yugoslavia and Hungary. The main Nazi goal at this time was achieving political security but they still announce their first four year plan in 1933 with the aim of achieving autarky as soon as possible. Their most important targets were unemployment and agriculture.

Creating employment

By the time the Nazis came to power, unemployment had already reached its lowest point and was starting to turn around, businesses were employing people again.

In an effort to inflate their achievents, the Nazis manipulated statistics. They distorted the definition of 'workforce' massively. Jewish people were no longer allowed to work in the civil service or in other roles. This removed them from workforce statistics. The Nazis also discouraged women from working, and married women who left work, or were fired were also removed from workforce statistics.

The Nazis also created work and encouraged businesses to do the same. They concentrated on temporary work for long term unemployed people. They created schemes such as the Reichsarbeitsdienst (Reich Labour Service, also known as RAD) which provided low paying, manual work for men and women. It offered them basic food and accommodation in labour camps that were made up of tents or barracks. Schemes like these mainly built roads to support the increase in manufacturing of trucks and cars, improve communications and helped move goods and materials more efficiently.

Managing agriculture

Agriculture was an important part of the Nazi's desire for autarky, so agricultural reforms were included in the first four year plan. Alfred Hugenburg was the minister for agriculture, in his first few weeks in office he increased import tariffs on agricultural products, which made German produce cheaper. He banned banks from repossessing farms, which meant that farmers in debt could stay in business. Hugenburg resigned in May 1933 and was replaced by Richard Darre who set up Reichsnahrstand (Reich Food Estate, or RNS) This regulated food production and distribution of farm produce. It also set prices for farm foods and wages of the workers. The RNS could fine people of to RM100,000 for not conforming it also set up its own Reich agencies to control the imports of farm produce. Previously mentions work creation schemes sent people, especially young men to farms and on building projects. Not everyone was happy about the government control of foods and prices. Not al farmers wanted to b told what to grow and how much they have to sell it for. But the scheme was working, in 1928 German farmers created 68 percent of all farm produce in the country, by 1934 (1 year after the nazis came to power) it was at 80 percent.

Managing business and the workers

A few large scale such as iron and steel industry supported the Nazi's however, those depending on exports didn't. Some suffered due to the Nazi's measures to help small businesses. Some department stores made 80% less in 1934 than previously in 1929 due to the 1933 Law for the Protection of Retail Trade stopped the building of new stores and banned the expansion of existing ones. Nazi propaganda discouraged people to department stores and instead use small businesses as the had supported Hitler.

In the Weimar Republic, unions had been an issue due to wage and hours disputes and many strikes and lockouts. However, under Nazi rule, there was only one union, the DAF (German Labour Front) from May 6th 1933. It was voluntary to join however it became very difficult to find work for non-members.

The crisis of 1935-36

Schacht's shifting of Germany's trade to southeast Europe via exchanging goods initially boosted trade. by 1935, however, countries were now demanding cash for good rather than goods for goods. For example, Bulgaria was demanding cash for oil rather than goods. This was an issue as Germany was not yet self sufficient and rearming and work creation meant that they needed raw materials imported. Worse yet there was a shortage of fats and meat. This crisis was significant as it meant Schacht had to choose between raw materials and food. This meant consumption had to be cut without introducing rationing as it was unpopular and press for higher production. This was the basis of the 4 year plan.

Creating a command economy 1936-39

A command economy is where the state decides what and how much to produce (rather than businesses and agriculture.) This was the Nazi's aim from the start, initially setting up control over businesses and agriculture as they rebuilt the economy. The first 4 year plan only lasted 3 years (until 1936) as the state nad high foriegn debts because of raw material imports for rearmament and work creation.

Second four year plan

The new 4 year Plan was set up by Goering and had a tight focus on preparing for war and had control of production. The raw materials Germany could not produce were replaced with synthetic alternatives for example, rather than rubber, 'Buna' was used. This meant that new factories were needed to be built and new processes meant technical difficulties often occurred. Consequently, the results weren't as rapid as had hoped.

The situation in 1939

Although Nazi's had very tight control of the economy by 1939, farming and industry didn't always meet the demands as they were sometimes unrealistic. All in all this meant that the Nazis weren't as ready for war as they may have been if they could have only focused on the war efforts and not had to focus on food production. Even so, rearmament had been successfully done without influencing prices or wages and no widespread protests were led at having other good likes toys or electronic supplies in short supply.

Changing standards of living

Between 1933 and 1939 standards of living had become a lot more divided between conformists 'pure Germans' and 'undesirables'. On 18th of august 1939 all doctors, nurse and midwives had to report and child under 3 showing signs of disability. In October that year Nazi's launched the T4 campaign to get rid of disabled children. From January 1940 this campaign was extended to other hostpitals for the old, mentally ill or chronically sick.

For the ordinary worker the standards of living generally improved and unemployment dropped.

What was the impact of war on Nazi economic policies 1939-45

When war broke out Germany was more ready than either France or Britain but was not as ready or self sufficient as Hitler had hoped. Generally, the war did not really change Nazi economic policies as they had already been geared for war. However, it did eventually change the way the war was run. The office of the four year plan was not managing war production very well. On February 1940 Hitler made Fritz Todt minister of armaments and munitions with the task of organising industry to full production. However this did t work as he was denied the amount of control he needed to make it as efficient as possible.

An over stretched economy

In 1945 the feconomy was severely overstretched and war production was badly affected by:

  • Allied bombing
  • Loss in land that had provided raw materials
  • Damage to electricity, water and gas supplies
  • Sabotage by foreign workers

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