Nazi Economy- 1933-1939

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Reducing Unemployment

  • Pre-Nazi Germany- unemployment peaked at 8 million
  • Introduced Law to Reduce Unemployment in June 1993
  • Also expanded was RAD and establishment of public work schemes for those aged 19-25
  • Reducing unemployment would help improve politics of Germany as well as proving the "Hitler Myth"
  • Schemes no doubt worked- unemployment reduced from 25.9% in 1933 to 7.4% in 1939
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New Plan

  • Hjalmar Schacht implemented the New Plan in 1943
  • Covered a number of things on how to fix economy including:
  • Mefo Bills- credit notes issues by Reichsbank, held for 4-5 years with 4% interest- v. popular
  • Bi-lateral trade treaties set up with South East European countries- gave Germany more of an influence there
  • Battle for Production set up in 1943 to 1935 to help increase grain production but this did work- only area where little was achieved
  • Transport system improved- Autobahn set up
  • Wage and price controls used to lower inflation
  • German GDP increased by 40% and production increased by 60%
  • Schacht's successes were a precursor to rearmament and autarky
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  • Helped brought about through Herman Goring and Four Year Plan (FYP)
  • Military expenditure increased from 10bn to 17bn
  • Luftwaffe was set up, ammo created and conscription was also set up to prepare Germany for WW2
  • Rearmament helped increase production by 60% and helped expand German govt.
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  • Also encompassed within FYP was ability of Germany becoming self-sufficient- done through autarky
  • Goring helped to produce synthetic rubber and oil to help for WW2
  • Autarky did not really work as it was expensive and drained German economy
  • By 1938 balance of trade deficit was 432bn RM and so therefore prices remained at a fixed level so too did wages as Nazi govt. did not want to press the consumer too much- one reason why Schact resigned
  • Autarky was the sole area where the Nazis did not achieve any economic fortunes
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