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German Economy

under Hitler

Blah Blah Blah we will be presenting on German economy under hitler. As economy
is quite a dry but confusing topic we have spared you the trouble of looking at memes
but we have infused the slides with enlightening propaganda and intelligent humour.

Contents
1.
2.

Nazi Germany 1933


Economic Recovery 1933-1936
a.
b.
c.

3.
4.
5.
6.

Reduction in unemployment
Schnachts Economic Policy
Rearmament and Autarky

4 Year Plan 1936-1940


Total War Economy 1942-1945
Evaluating Hitlers economic policy
Conclusion

The economic setting: Nazi Germany 1933

Hyperinflation after WWI


Great Depression was responsible for the undoing of the post-war Weimar Regime
Hitler was appointed Chancellor on January 1933
Recognized the supposed failure of the free market and the need for nationally guided economic
development
His methods summarised: emphasising the creation of more jobs, subsidies for hiring more workers in
the private sector, increased public expenditure and investment and tried to stimulate consumer
demand

Before we begin, heres a quick summary of the economic background in 1933.


At the end of WWI, Germanys financial position was disastrous. Besides economic
ruin, it had to pay reparations to the Allied powers. The Weimar government printed
money to pay off its debts, but this created hyperinflation. Savings became worthless
and most Germans became poor overnight.
Prior to the great depression, germany had negotiated loans with America to maintain
its economy. As the great depression hit, America recalled their loans from Germany
causing the German economy to come to a standstill. Companies throughout
germany went bankrupt and unemployment rose from 650,000 in 1928 to 6 million in
Jan 1933. The government was unable to resolve these economic problems.
Therefore, the Nazi Partys solutions were seen as a viable alternative.

Economic Recovery 1933-1936


Three Important Economic Aims
1.
2.
3.

Reduce unemployment
Re-armament
Achieve economic self-sufficiency (Autarky)

Here are the three aims that guided Hitlers economic decisions in the years to come,
in no particular order of importance.

Economic Aim 1 - reducing unemployment


Aims and Intentions

Tackle the Depression caused by the Wall Street crash of 1929


Restore Germany to full employment
Macro-scale: Personal benefit for Hitler: improve conditions for millions of Germans create a
broader feeling of optimism legitimize his rule and enable him to gain favour constitutes
consolidation of power and political regime

Firstly, Hitler intended to tackle the Depression and restore Germany to full
employment. This would improve conditions for millions of Germans and create a
broader feeling of optimism, both of which would consolidate the regime politically.

Economic Aim 1 - reducing unemployment


How was this achieved?

Reich Labour Service work on government building projects many people


were hired reduced unemployment
Projects included:
Irrigation ditches
New motorways (autobahnen), 3000 km of roads
Public buildings, schools and hospitals

The nazi party set up the Reich labour service to work on public works and
government building projects. This was a massive public works programme in which
irrigation ditches, new motorways, railways, public buildings, schools and hospitals
were constructed. Through this project, the Reich Labour Service helped to reduce
unemployment by employing jobless people to work on these public building projects.
At the same time, women were made to stop working and confined to domestic
activities. The jobs that were previously held by these women were then given to
unemployed men.

Economic Aim 1 - reducing unemployment


Independent trade unions were banned

May 1933: Nazis set up their own trade union, the Deutsche Arbeitsfront (DAF)
Banned strikes, sackings and lockouts
Everyone had to join
Ensured there was no workers uprising, only obedience
Working hours were increased and wages were frozen (1935)
1933: Created Kraft durch Freude (Strength through Joy)
1938: Created Schonheit der Arbeit (Beauty of Work)

In the process of reducing unemployment, the Nazi Party expanded economic control
over Germany. All independent trade unions were banned, except for one, the
German Labour Front or DAF, the abbreviated form of its german name which I cant
pronounce. The DAF banned strikes, sackings and lockouts, so as to maintain
discipline among both workers and employers so as to maintain the stability of
productivity and enable the Nazi Party to exercise control over industries. Everyone
had to join the DAF, such that all workers in Germany were now represented in one
national body. Membership included employers as well as employees. DAF was the
sole arbiter on wages, working hours and discipline. The aims of DAF was to win
workers over to Nazism and increase production.
In 1933, DAF launched Strength through Joy, intended to improve workers leisure
opportunities, with subsidized holidays such as holidays, hikes sport, theatre and
cinema visits. In
As such, through such worker-oriented facilities, there was plenty of incentive to work.

Kraft Durch Freude - Strength Through Joy

Also known as KdF


Established to provide workers with leisure opportunities
cheap cruise holidays
skiing, sailing and other sports
trips to the theatre and cinema
health clubs
free holidays
Kept the workers happy
Removed social barriers
Work and Bread, a wonderful
blessing to the unemployed and
starving

The banning of all trade unions was something worth complaining about. Therefore,
the DAF established the KdF movement to keep workers happy in hopes of boosting
their productivity (hence the term Strength through Joy). Through the KdF,

everybody had a job, and a wage. To people who had been unemployed and
starving, 'work and bread' was a wonderful blessing worth every civil liberty
they lost.

which gave workers rewards for their work - evening classes,


theatre trips, picnics, and even free holidays.Through the KdF the
state was able to control the individual, got everyone to conform and managed their
leisure time. It was a way of removing social barriers. In the past, only the rich could
afford a holiday.

Economic Aim 1 - reducing unemployment


Unemployment rates decreased as a result of the jobs provided:

1933: 6 million
1936: 2.5 million
1938: 0.2 million

Schutzstaffel (SS), the NSDAPs racially elite unit, persecuted the unemployed by
branding them as lazy.

By Hitlers standards.

The Reich Labour Service was indeed effective in reducing unemployment to a


noticeable extent as supported by these figures.

How Hitler reduced unemployment without


actually reducing unemployment

Jews were removed from their jobs and these jobs were given to men
Women were removed from their jobs and these jobs were also given to men
Jews and women went unemployed
Jews and women were not counted in unemployment statistics

However, there was a catch to Hitlers policy of reducing unemployment: It is arguable


that while unemployment figures were reduced, the numbers employed did not
increase by that much, simply because a portion of the jobs created were as a result
of kicking Jews and women out of their jobs and letting other German men take their
places. Since Jews and women were not counted in unemployment statistics, they did
not contribute to unemployment figures in the statistical sense.

Economic Aim 2 - Balance of Trade


Aims and Objectives

Hitler appointed Hjalmar Schacht first as President of the Reichsbank in 1933,


then Economics Minister in 1934
Schacht reassured the economic elite that their policies would not be
detrimental to them since Schacht had close ties to them
He used deficit financing to boost the economy, and pioneered the use of Mefo
bills

Economic Aim 2 - Balance of Trade


Deficit Financing

the government is able to increase public expenditures by borrowing money


instead of increasing taxes
used this to boost the economy

Economic Aim 2 - Balance of Trade


Mefo Bills

Financed increase public expenditure without causing inflation


Issued by the Reichsbank and guaranteed by the government
Funded about half of Germanys rearmament programme during 1933-1938
Also disguised military expenditure

Economic Aim 2 - Balance of Trade


New Plan of 1934

In 1934, the revival of the economy was problematic because of balance of


trade deficits

Germany importing more than it was exporting


gold and foreign currency reserves running extremely low

The new plan allowed the government to regulate imports by controlling the
allocation of foreign exchange. Imports had to be approved by the government
A series of bilateral trade agreements were made, especially with Balkan states

supplied much of Germanys raw material imports


included some barter which eliminated the use of scarce foreign currency
served to increase Germanys influence in this area

Economic Aim 2 - Balance of Trade


Results

Inflation was slowed down with state intervention (control over wages and
prices) and use of Mefo bills
Trade agreements with other countries that contributed much to Germanys
need for raw materials

Economic Aim 3 - Rearmament and Autarky


Why rearmament?

In anticipation of future war, German economy must become as self-sufficient as possible


Economic recovery more resources utilized to rebuild Germanys military might
such resources included:
steel, coal, oil, explosives
Thus re-armament was necessary in order to make Germany ready for anticipated war.
Creation of Wehrwirtschaft - (defence economy)
German Economy was geared to bolster the cost of War

Hitlers intended to create a defence economy geared to the needs of future war. This
was inspired by the realization that Germany had lost WWI, mainly because such a
long and drawn-out conflict eventually caused the economy to collapse. In anticipation
of a future total war, and to ensure Germany was adequately prepared, the German
economy would have to expand essential war materials such as steel, coal, oil and
explosives. Additionally, the workforce would have to be trained for skills transferable
to war production.

Economic Aim 3 - Rearmament and Autarky


How was re-armament achieved?

1935: Conscription for for all 18-25 year old males

Made to do military service for 2 years

Armed forces grew from 100,000 in 1933 to 1.4 million in 1939


Big businesses that produced important products for war were given lucrative
government contracts.
Rapid rearmament
Germany was primed for War

Economic Aim 3 - Rearmament and Autarky


Autarky

Self-sufficiency in the production of food and raw materials especially when at


war
Not being dependent on imports for economic survival.
Bolster the economy against the financial burden of war via trade embargos
(Germanys economy was mostly geared towards preparing for war, out of
resentment for the harsh conditions that were set against them after losing the
WWI)
Major emphasis on rearmament and self sufficiency
Little foreign resistance

Closely related to rearmament was autarky, addressing the self-sufficiency in the


production of raw materials especially when at war.

Economic Aim 3 - Rearmament and Autarky

Increase production of raw materials such as iron and food


Develop home-grown substitute products for the key commodities like rubber
and coal

Propoganda poster
used to encourage
Germans to contribute
to national selfsufficiency (Autarky)

Translation:
Hitler is
building/constructing
(in Germany). You can
help. by buying
German goods.

Economic Aim 3 - Autarky

In the end, autarky enjoyed very limited success


Growing pace of rearmament, demand of raw materials not met, depended on
foreign imports
Germany continued to import a lot of goods such as butter, oil and vegetables.
In 1939, The Third Reich still depended on foreign imports for 33% of its raw
materials, especially iron
The development of key commodities was extremely inefficient
6 tons of coal to produce one ton of oil

4-Year Plan and Total War Economy


Give me four years. There has been
time enough in four years to find out
what we cannot do. Now we have to
carry out what we can do. I thus set
the following tasks.

Hitler expressing his position in a secret


memorandum, August 1936

(Explain the propaganda poster, possibly googling what the words mean)
Hitler quote: time enough in four years refers to the duration of WWI in which
Germany was defeated.
Although, or simply because it was secret, this memorandum is one of the most
important documents of Nazi history, because it provides a clear insight into Hitlers
war aims and the development of the Nazi economy.

(The poster reads Give me 4 years in English. )

Nazi 4-year plan 1936-1940


Hitlers directives:
1. The German armed forces must be operational within 4 years
2. The German economy must be fit for war within 4 years.

The 4 year plan was under the control of Hermann Gring, who became
economic dictator

Explain some key terms in the directives that will shed light on how
these would guide and translate into practical action from 19361940:
to be operational clearly was an order to expand rearmament
fit for war refers to the policy of autarky which was to maintain selfsufficiency in the production of food and raw materials especially
when at war.

increase agricultural production


-re-train key sectors of the workforce
-national control/regulation of imports and exports
-self sufficiency in the production of raw materials
-strengthen national socialism -----> allow for rapid rearmament

Nazi 4-Year Plan 1936-1940


Concrete objectives of the 4 Year Plan:

Regulate imports and exports prioritize strategic sectors e.g. chemicals and
metals at the expense of agricultural imports

Control key sectors of the labour force

Reich Price Commissioner


Increased work direction by DAF

Make Germany self sufficient in war materials by:

IG Farben, responsible for producing Zyklon B (hydrogen cyanide gas), received well over 50% of
government investment

increasing production
developing home grown substitutes (ersatz)
oil instead of coal, artificial rubber (buna)

Attempt to increase agricultural production, avoiding imported foodstuffs

grants for fertilizers & machinery

Now that HItler had given his directives and expressed his position, these had to be
translated into practical objectives that the 4 year plan would have to meet.
Firstly, The Plan would regulate imports and exports, so as to prioritize strategic
sectors at the expense of agricutlural imports. Such strategic sectors included metals
and various chemicals which were used to make tanks, aeroplanes, explosives or
poisonous gas used for the murder of numerous political prisoners in the
extermination camps at Auschwitz.
Secondly,
Thirdly, to increase the production of raw materials, so as to reduce the financial cost
of importing vital goods for rearmament and war like steel, iron and aluminium. In
tandem with this, industries would also develop substitute products that could replace
imported products.Examples include using oil instead of coal, and the production of
artificial rubber.
Lastly, to increase agricultural production so as to avoid imported foodstuffs that
would mean a lot more money spent. To achieve this, the Nazi government provided
grants for fertilisers and machinery.

Nazi 4-Year Plan 1936-1940


Commodity
(thousand tons)

4-Year Plan
target

output 1936

output 1938

output 1942

Increase from
1936?

Hard coal

213,000

158,400

186,186

166,059

yes

Steel

24,000

19,216

22,656

20,480

yes

Aluminium

273

98

166

260

yes

Oil

13,830

1790

2340

6260

yes

Artificial rubber

120

0.7

96

yes

Explosives

223

18

45

300

yes

The table shows the success of the 4 year plan measured in statistics. War
commodities increased from 1936

Guns or Butter?
A poster that appeared
in a banned magazine,
inspired by a speech by
then- economic dictator
Gring. It says:
Would you rather have
butter or guns? Shall we
bring in lard or iron ore?
I tell you, guns make us
powerful. Butter only
makes us fat.

Critics of the new Nazi


regime felt it was more
interested in rearmament
rather than encouraging
trade and peace.

Hitlers stress on miltiary requirements, with extra resources and capita devoted to
rearmament, brings us to the idea of Guns vs Butter. It relates to the tension
between between putting economic resources into rearmament and supplying
consumer goods to German consumers. The above is a poster intending to criticize
the Nazi regime and its prioritizing of rearmament above supplying consumer goods.

Guns or Butter?

Through the KdF, the Nazis devised a scheme to


allow workers to buy a Volkswagen Beetle car for
a small weekly payment.

It was possible to pay for the car in instalments,


and the buyer would only receive the car after
they had paid the balance in full.

When the Second World War started in 1939, the


car factories had to turn their attention to
manufacturing arms.

Many Germans lost their money. (probably


invested in the production of war materials)

One of the KdFs popular schemes was the Volkswagen - the people's car. It
was possible to pay for the car in instalments, and the buyer would only
receive the car after they had paid the balance in full. When the Second World
War started in 1939, the car factories had to turn their attention to
manufacturing arms. As a result, many Germans lost their money, and there
were demonstrations and expressions of discontent.

Guns and Butter: Blitzkrieg 1939-1941

lightning war
Influenced by Nazi economic policy
Use of dive-bombers, paratroopers and motorized infantry in invasions
Relatively quick method of attacking ensured wars remained short
Hitler recognized Germanys failure to achieve autarky (self-sufficiency)
Motive was to prevent excessive strain on economy and economic collapse midwar
A short war would not reduce the production of consumer goods excessively.
Could maintain a reasonable balance between guns and butter

Historians argue that Nazi economic policy could have influenced the Blitzkrieg, a
military strategy Germany adopted in WW2. It was the use of dive-bombers,

paratroopers and motorized infantry in invasions. Such an approach kept wars


short. Such an approach was attributed to Hitlers recognition of the failure of
autarky and Germanys inability to stay self-sufficient. Because of this, Germany
could suffer an economic collapse in the middle of the war, hence a long, total
war would place Germany in a precarious (or dangerous) position. Additionally, a
short war would prevent the production of consumer goods from being reduced
excessively due to keeping up with war efforts and producing war materials. In
this respect, Germany seemed to have both guns and butter.

Total War Economy 1942-1945

December 1941: Hitler issues Rationalization Decree


Feburary 1942: Albert Speer appointed as Minister of Armaments
His close relationship with Hitler allowed him to exert increasing political
influence.
Able to implement a whole range of personal initiatives to improve production,
such as:
Employing more women in the arms factories
Making effective use of concentration camp prisoners as workers
Preventing skilled workers being lost to military conscription

In December 1941, Hitler issued the Rationalization Decree, which sought to


streamline war production and to restructure control of the economy.
In Feburary 1942: Albert Speer was appointed as Minister of Armaments. His close
relationship with Hitler allowed him to exert increasing political influence. Managed to
implement a whole range of personal initiatives to improve production and optimize
human resources. 3 of the more notable ones are shown.

Total War Economy 1942-1945


October 1942:

Ammunition production increased by 97%


Tank production rose by 25%
Total arms production rose by 59%
Skillful manager of the war economy

As you can see, Speer proved himself to be a skillful manager of the war economy,
which resulted in a fundamental increase in arms production. Ammunition production
increased 97%, tank production 25%, total arms production rose by 59% within the
first six months of Speers appointment.

Total War Economy 1942-1945

Germany defeated at Stalingrad in winter 1942


Comprehensive redeployment of existing German workforce
By 1943, 61% of all German labour was involved in war production.
Enormous increase in female workforce

1944: 50% of female population involved

Recruit and conscription of enormous amounts of foreign workers to aid war


production in the Reich.

8 million were conscripted

After Germanys defeat at Stalingrad in the winter of 1942, a total war economy began
in earnest. To further utilize and maximize human resources, 3 distinct strategies
were used:
Firstly, the comprehensive redeployment of the existing German workforce, which
meant that by 1943, 61% of all German labour was employed in war production,
compared with 21% in 1939.
Secondly, there was an enormous increase in the female workforce, an initiative
introduced by Albert Speer upon his appointment as Minister of Armaments. This
increase amounted to half the female population by the beginning of 1944.
Lastly, the Nazi authorities in occupied territories were able to recruit or to conscript
enormous numbers of foreign workers, a total of 8 million by 1944, to aid war
production in the Reich.

Total War Economy 1942-1945


Aircraft produced
Germany

Britain

USA

USSR

1940

10,200

15,000

6100

7000

1941

11,000

20,100

19,400

12,500

1942

14,200

23,600

47,800

26,000

1943

25,200

26,200

85,900

37,000

1944

39,600

26,500

96,300

40,000

1945

7052

12,100

46,000

35,000

While Germany had managed to increase its arms production manyfold since the end
of the 4-year plan, it still lost out to countries like USSR and the USA when we
compare their war production output. In 1945 the Allies carried out blanket bombings
on German factories that contributed to the sharp decrease in production. At this
juncture it is worth pointing out that German tank production decreased from 19,000
in 1944 to 3,900 in 1945, also as a result of the blanket bombings.

Collapse of the German War Economy 1945

From 1943 onwards the German War Economy was under tremendous stress

In that year allied bombing forced the diversion of 2 million men and 50,000 pieces of artillery
into anti-aircraft service.

By the following year, aircraft production was 31% below target and tank production 35%
below.

Bombins Persisted until 1945 where the War Economy finally gave way and
collapsed
Industrial destruction and breakdown in communications
Germany was forced to divert available resources towards the
construction of anti-aircraft installations and underground industrial sites
Prevented Germany from increasing its arms production even further
Unable to achieve a total war economy

From 1943 onwards the German War Economy was under tremendous stress. In that
year allied bombing forced the diversion of 2 million men and 50,000 pieces of artillery
into anti-aircraft service. By the following year, aircraft production was 31% below
target and tank production 35% below.

Historians argue that the effects of the Allied bombings prevented Germany
from increasing its arms production even further. Additionally, it caused
industrial destruction and breakdown in communications. In anticipation of
further bombings, Germany was forced to divert available resources towards
the construction of anti-aircraft installations and underground industrial sites.
As a result of this, Germany was unable to achieve a total war economy. The
peak in production in 1944, was arguably well below its full potential.

Was the focus on rearmament beneficial or


destructive?
1932

1933

1934

1935

1936

1937

1938

0.9

1.7

3.5

4.9

5.1

6.1

7.9

Transportation 0.8

1.3

1.8

2.1

2.4

2.7

3.8

Rearmament

1.8

3.0

5.4

10.2

10.9

17.2

Construction

0.7

All figures in billion RM

The table shows the public expenditure in Germany in various sectors of the
economy. Over the years, an increasing percentage of capita was devoted to
rearmament, as compared to the other economic sectors. Note the significant
increase in expenditure on rearmament upon the introduction of the 4 year plan in
1936.

Was rearmament truly necessary?

Germanys focus on production on war materials such as oil, steel, coal and
explosives was achieved at the expense of production of consumer goods.
Germany was spending more money than it was earning from export and selling
of consumer goods.
Capita could be achieved in 2 ways:

export of consumer goods


economic exploitation of invaded countries during WWII

Due to the large amount spent on rearmament, a strong military was produced
which was useless unless Germany went to war
Although Germany did go to war, there was a shortage of food and basic
necessities during the war.

In this slide, Ill be examining the pros and cons of rearmament.

Germany was spending more money than it was earning from export and selling
of consumer goods. Not only was this indicative of the lack of consumer goods
being made available to the public, it also meant that Germany was plunging
itself into national debt.

Was rearmament truly necessary

German civilians derived little benefit from the additional food resources made
available by German military victories, the vast bulk being directed towards
military consumption
In fact, food was diverted at a faster rate to the military than it was produced

Consumption in Germany declined by 25%, compared to 12% in Britain who was also involved in
WWII

Other commodities such as clothing became more difficult to obtain as


production was geared increasingly towards the requirements of the war effort

1941: 40% of textile output and 44% of all manufactured clothing was designated for use by the
armed forces

German civilians derived little benefit from the additional food resources made
available by German military victories, the vast bulk being directed towards military
consumption. In fact, food was diverted at a faster rate to the military than it was
produced. To illustrate this, consumption in Germany declined by 25%, compared to
12% in Britain who was also involved in WWII. The reason why Germany experienced
a greater decrease in consumption than its European counterparts can be attributed
to a complex of causes. Even before the war, the focus on rearmament made it such
that there was less food being imported, as highlighted in the 4 Year Plan. Instead,
the German government tried subsidizing farmers so that more food could be
produced but this was ineffective due to the lack of machinery. Shortage of workers
too, because wages in agriculture and consumer industries were much lower than
their counterparts working in war industries little incentive to work limited
expansion of agriculture industries. Also, it was possible that the expansion of
agriculture could not keep up with the rising birth rate, attributed to the greater
number of women staying at home since they were banned from working.
Anyway, other commodities such as clothing became more difficult to obtain as
production was geared increasingly towards the requirements of the war effort. For
example, in 1941, 40% of textile output and 44% of all manufactured clothing was
designated for use by the armed forces

Was rearmament truly necessary


Hitlers vision of a powerful militarized economy clearly failed the test of war. Recovery
from the Slump had been real enough. But at the point where that recovery might have
been used to improve living standards and expand trade Hitler chose to divert economic
development towards massive militarization in a short term gamble that he could create a
new political and economic order In 1946 Germany was once again plunged into
poverty and economic stagnation - where Hitler found it in 1933.
R. Overy, Modern History Review, 1996

The above quote from a renowned historian aptly sums up the argument against
rearmament. The slump refers to the Great Depression which Nazi Economic
policies had helped Germany recover from.

Impacts of
Hitlers Economic
Policy: An Evaluation

Benefit for workers

Reduction in unemployment

Increase in workers wages

Reich Labour Service and conscription programmes provided millions of jobs


Decreased from 6 million in 1933 0.2 million in 1938
Shortage of workers in 1939
Bonuses and other economic benefits
1936: average wage was 35 marks a week, 10 times more than 1932

Ban on sacking - enabled Germans to retain their jobs


Implementation of KdF

Everyone had a job and a wage, a wonderful blessing to the unemployed and starving

The first benefit was that there was a noticable reduction in unemployment as
mentioned earlier, decreasing from 6 million in 1933 to 0.2 million in 1938, over a
short span of just 5 years. At one stage, Germany was even facing a shortage of
workers. As demand for skilled labour increased, many employers gave their workers
added benefits by giving Christmas bonuses and providing insurance schemes.
Secondly, by 1936 the average wage of a worker was 35 marks a week, 10 times
more than the dole money which 6 million had been receiving in 1932. This enabled
All in all, Hitlers economic policy managed to increase employment rate and reinvigorate the German economy,

Workers did not benefit


Wages technically did not increase

Industrial demands of the regime and the need to produce materials for war
made increases in hours of up to 10% commonplace.
National average working week rose from 49 hours in 1939 to 52 hours in 1942

Material rewards were offset by declining conditions of employment

Increase in 150% in number of industrial accidents in 1933-1939


200% increase in occupational diseases in 1933-1939

Despite propaganda to show that wages had increased, this was matched by an
increase in working hours. For example, the national average working week rose

from 49 hours in 1939 to 52 hours in 1942. Thus, it can be argued that wages
did not increase because the workers were simply working longer hours. Also,

Workers did not benefit


Workers lost their freedom and were tightly controlled

Banning of trade unions and consolidation of all workers/employees into DAF


prevented them from striking or bargaining for higher wages
Although sacking was banned, there were heavy restrictions in job mobility as
workers required government permission to leave their jobs. This was a
problem especially when working conditions were not good.

Another thing that demonstrates how the workers suffered under the economic policy
was the the fact that DAF was just an excuse to control the workers. Through the
banning of trade unions and the consolidation of all workers into the DAF, it prevented
workers from striking or bargaining for higher wages or better working conditions. DAF
had supreme authority over wages and working hours, and since all workers and
employers were inside, or should i say, under the control of the DAF, so when
Germany entered WWII, the workers were forced to work harder.

Less benefit for women and Jews

Creation of jobs was achieved at expense of other groups

Women
Jews

Women were pressured to leave their jobs and stay at home and take care of
children.
Jews and anti-Nazis had their jobs taken away and given to supporters of the
Nazis. Hence, in reality, some segments of German society did not benefit from
German creation of jobs.
Unemployed Jews and women did not contribute to total unemployment
figures.
Hence in reality, segments of German society (especially Jews) did not benefit
from German creation of jobs.

Firstly, although the Nazi government declared that they had reduced unemployment
in Germany, a closer look showed that the creation of jobs was achieved at the
expense of other groups in German society. Women were pressured to leave their
jobs and stay at home and take care of children. While the industrial expansion of the
4 Year Plan maid female employment unavoidable as they were involved in arms
production, professional posts remained closed to them. Jews and anti-Nazis had
their jobs taken away and given to supporters of the Nazis. Hence, in reality, some
segments of German society did not benefit from German creation of jobs.

Benefit for big businesses

Big business benefited

4 Year Plan produced important products such as steel, coal, oil, explosives
Businesses that were important were given lucrative business contracts

E.g. Daimler-Benz, an aeroplane manufacturing company, had its factories fully paid for by
the state.
Between 1932 and 1941 production rose over 800%
E.g. IG Farben, a chemical firm, received well over 50% of governmental investment and its
profits were 240 million RM in 1939

The third benefit was for the big businesses, in the sense that since the re-armament
was so important to the government, and its top priority in the years of the total war
economy from 1942-1945, these big businesses that manufactured goods for war
were considered very important to the government. This meant that they were given
lucrative business contracts. For companies who were willing to collaborate actively
with the Nazi regime of establishing a war economy, production increased by up to
800% and profits increased by large amounts.

Less benefit for small industries


Smaller Industries like agriculture did not enjoy similar levels of freedom

Limited agricultural growth


Consolidated and dictated by state
Lack of capital for investment limited mechanisation efforts and wages paid by
the Reich Food Estate

Lastly, because the government had chosen to invest more capital to further
rearmament and mlitarizsation efforts, there was a the lack of capital for investment
which limited mechanisation efforts and wages paid by the Reich Food Estate. Reich
food estate was kind of like the collective farms under Stalin where it regulated
production, imports, wages and prices.

Conclusion
Nazi economic policy did have its benefits but it came at the expense of workers
well-being.
Rearmament came at the expense of the civilians as the redistribution of
government investment translated into lowered production of consumer goods.

In conclusion, Hitlers economic policies were successful in the short term. Under
Hitler, Germany was able to overcome its dire economic circumstances and increase
employment and wages. However, these benefits were offset by the lack of
improvement in working conditions and the restriction of their freedom. Moreover,
employment problems were only resolved with limited effectiveness as the reduction
in unemployment figures was due to the removal of women and Jews from their jobs,
making them unemployed as well.

References

History readings
Democracy and Dictatorship in Germany, 1919-1963 by Geoff Layton
Germany 1848-1991 by Derrick Murphy, Terry Morris and Mary Fulbrook
http://www.bbc.co.
uk/schools/gcsebitesize/history/mwh/germany/economicrev_print.shtml
http://www.bbc.co.
uk/schools/gcsebitesize/history/tch_wjec/germany19291947/2economicsocia
lpolicy_print.shtml