Nazi Economy

Inital Aims 1933

• Tackle the Depression (Wall Street Crash 1929) and restore Germany's full employment, improving conditions for millions of Germans and create a broader vision for optimism, both of which would consolidate his regime politically.

Hitler's Economic Aim

• Hitler viewed war as inevitable, and stressed how the German economy must beome as self-sufficient as possible, thus, he created a Wehrwirtschaft/defence economy, which is geared to the needs of future war. Supported by nationalist circles and the army.

• This was inspired by the realisation that Germany had lost the First World War through... suffering an economic blockade and because of poor economic and social organisation.

• The economy was to expand vital war materials, develop substitues for imports, and train the workforce for skills transferable to war production, to make Germany ready for war.

Reasons how Hitler's economic policy was successful include...

• Unemployment dropped quickly
• Wages rose slightly
• Working hours increased from 49 hours per week in 1939, to over 60 hours per week by 1945
• There were fewer consumer goods
• There were no Trade Unions-they were replaced by the KDF-Strength through Joy

Reasons how Hitler's economic policy was not succesful include...

• Hidden Unemployment- Nazi government manipulated unemployment figures by not including certain groups of people, e.g. women and Jews lost their jobs and weren't included in the unemployment figures. Those incarcerated in concentration camps were not counted and those who worked part time were considered in full time employment.
  
• Dr Hjalmar Schacht- Minister of Economic 1933-36, and had a majority to do with the improvements, not Hitler. He believed in steady growth and a stable economy. He promoted trade agreements with developing countries and encouraged public work schemes such as the building of Autobahns (motorways). 1934 New Plan aimed to reduce imports into Germany. Resigned as Minister of Economics 1937 (remained as President). Removed by Hitler in 1939-accused of being involved in plots against Hitler.

The National (Reich) Labour Service (RAD)

• 1935-all men 18-25 had to do six months labour, mostly in agriculture or on public work schemes, e.g. planting new forests or digging ditches on farms. It was promoted as a way of educating everyone to value manual labour and to raise the status of workers in the National Socialist community. Men also had to do military service for two years- hitler's priority after seizing power was to build Germany's armed forces.

The German Labour Front (DAF)

• Set up by Robert Lay on 6 May 1933 to represent all workers. Biggest organisation in the Third Reich-5 million in 1933-22 million in 1939. KEY AIM: reconcile the workers to the Nazi Party, and to act as kind of 'honest broker' between employers and workers, promoting the concept of Volksgemeinschaft (people's community).

Public Work Schemes (Work Creation Programmes)

• June 1933- Nazis passed a law to reduce unemployment through the establishment of work creation programmes. Most effective initiative = construction of autobahns. Subsidies were given to large companies to employ more workers. By 1936 there was a shortage in labour.

Strength through Joy (KDF)

• Created to organise workers' leisure time. Its most distinctive innovation was to offer subsidised 'package' holidays such as ocean cruises, which formerly would have been beyond the reach of workers. The Volkswagen car scheme was also a popular innovation, launched in 1939. 
• Propaganda message of KDF= persuade workers to see their labour not just in teams of wages but also in terms of serive in the nation.

How popular was the KDF?

• Popular through the 'luxury tourism'. Holiday entitlement increased and, though expensive cruises remained beyond the means of most, many people took advantage of the benefits offered.
• The working class remained the social grouping least impressed by Hitler's so-called 'economic miracle'. By 1939, wages rose on average by only 1%, working hours increased and many regarded the RAD as merely a source of cheap labour for the regime. However, the regime was given credit for the return to full employment.

Rearmament

• 1934-Hitler ordered an increase in the armed forces. The army was to grow from 10,000 to 30,000 men, the navy was to build submarines and two battleships, an air force was to be created, thus, forbiding the Treaty of Versailles-if the allies found out what was happening, there was risk that they would invade Germany to stop it. So the armed forces expanded in secret.
• Air force pilots trained secretly in flying clubs. Hitler used an intense military campaign in order to improve techniques of planes, thus bombing, and infantry. Bombers were disguised as airliners. In 1935, when Hitler introduced the policy in which all men would have to do military service, he started to rearm openly. The Allies protested, but did nothing to stop him.

The Four Year Plan

• Remarmament was very expensive and Germany was yet to fully recover from the depression. As a result of this, the four year plan aimed to make the country self-sufficient in food and raw materials. This would save money by cutting the amount of goods bought from other countries. Artificial substitues were developed for materials imported overseas, textiles were made from pulped wood, rubber from coal and lime, coffee from acorns, etc. There were often no substitues for things, and the question was asked 'Would you rather have butter or guns?'.