The Nazi economy

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  • Created by: Millie
  • Created on: 08-03-13 11:49
Before 1933 what had Hitler made sure not to do in terms of economic policy?
Hitler made sure that he wouldn't be tied down with a definite economic policy and he even told his cabinet in Feb 1933 ' to avoid all detailed statements concerning an economic programme of the government'
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What were the three appoaches that the Nazis considered to manage the economy?
The socio-economic aspects of the 25-points programme e.g. nationalisation of all businesses, sharing the profits of large enterprises and extending insurance for the elderly. Deficit financing. Creating a defence economy.
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What was Hitler's attitude towards the 25-point programme and what were the consequences of this
He no longer showed any real commitment to these ideas like he used to in the early years of the Nazi party. The consequence of this was that there was some conflict within the party as some people still wanted to adhere to these principles.
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Why did Hitler want to create a defence economy?
Hitler wanted to avoid what happened in the first world war where the economic insability eventually led to collapse.
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What does a policy of autarky entail?
The aim of self-sufficiency in the production of food and raw materials
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With which of the three economic approaches did Hitler most identify and make the forfront of economic policy?
The creation of the defence economy
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What was the limiting factor in the actual creation of economic policies?
There were differences in opinion over economic planning, so even though the Nazi party considered the three aforementioned approaches they didn't have a plan by January 1933
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Was Hitler knowledge of economics a limiting factor?
Yes. He had no real understanding of economics and he left it to his bankers and civil servants to implement economic policy
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How can the Nazi economy be desbribed ?
The Nazi economy can be described as being pragmatic and dealing with issues as they came rather can carefully planning what to do with the economy
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Name the 5 areas of the economy that were badly affected by great depression 1929-33
Trade. Industry. Employment. Agriculture. Finance
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How was trade affected by the depression?
Germant relied heavily on trade- selling their goods to other countries- but becasue of the depression there was a slump in global trade/ decline in demand and consequently a decline in the demand for German exports too.
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How was industry affected by the depression?
Germany began to lose economic confidence in 1929 . Demand fell and businesses began to collapse.
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How was Employment affected by the depression?
There was mass long-term unemployment- because of the decline in industry.
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How many unemployed people were there in 1932?
5.6 million <- registered + unregistered probably about 8 million
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How was agriculure affeceded by the depression?
Farmer's wage and agricultural prices fell and there was widespread rural poverty
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How was finance affected by the depression?
Due to war debts, reparations and inflation German banking was under a lot of pressure even before 1929. When the depression occured there was a a loss of confidence in the finance sector. German share prices fell and 5 major banks collaped in 1931
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How did Schacht's policies stimulate economic recovery (1933-1936)
Increasing expenditure/ deficit financing.
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What happened to banking, interest rates and capital?
The state assumed greater responsibility for the control of capital . Interest rates were lowered
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What happened to farming and small businesses ?
They received a lot of assistance. There were tariffs on imported produce so as to protect German farmers. The Reich Entailed Farm Law reducing debts by tax concessions and lowering interest rates.Grants were given for house repairs.
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What happened to state investment / public works?
There was increased spending in these areas,In June 1933 the Law to Reduce Unemployment was renewed and expanded and the RAD was expanded to employ 19-25 year olds .Money was spent on work creation schemes in reforestation, building, motorisation +
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What happened to umeployment because of these schemes ?
Unemployment fell to 1.6 million in 1936! Whereas it was at 5.6 million in 1932.
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How did Schacht keep deficit financing under control?
Taxes remained high and he encouraged private savings in state savings banks.
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What were the fears surrounding Germany's rapid economic growth?
There was a fear that rapid increase in demand would cause inflation and that it would also lead to a balance of trade deficit.
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Why did these problems never come to fruition?
There was always strict control over wages and prices.
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What was the problem with Germany's imports and exports ?
Germany was importing more that it was exporting so its gold and foreign currency reserves were low. Because of these low reserves there were reservations about which sectors should have priority in spending the money.
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When was Schacht appointed minister of Economics?
July 1934
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When was the New Plan introduced?
September 1934
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What did it entail?
Complete control over trade,tariffs, capital and currency exchange. The main priorities were bilateral trade agreements-barter agreements; The Reichmark currency- Reichmarks could only be used to by German goods; Mefo bills- gov. money bills.
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What were mefo bills?
A credit note that would allow you to pay for goods <- disguised gov. spending
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What was the main purpose of the Four Year Plan?
To make the German armed forces fully mobilised within four years and to make the German economy fit for war within four years.
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What were the objectives of the Four Year Plan?
To regulate imports and exports. To control the key sectors of the labour force. To increase the production of raw materials. To develop substitute products e.g artificial rubber. To increase agricultural production.
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When was the Four Year Plan implemented and under whom?
October 1936 - Goring.
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Why was the creation of the Four Year Plan so significant? Did production increase?
Nazi control over the economy became much tighter. Production of aluminium and explosives but didn't meet targets. Arms production never reached the desired level.
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Was the Plan a success?
Kinda. Germany's imports did not increase but when war broke out Germany was still dependent on imports . Its economy was still a long way away from being mobilised.
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Other cards in this set

Card 2

Front

What were the three appoaches that the Nazis considered to manage the economy?

Back

The socio-economic aspects of the 25-points programme e.g. nationalisation of all businesses, sharing the profits of large enterprises and extending insurance for the elderly. Deficit financing. Creating a defence economy.

Card 3

Front

What was Hitler's attitude towards the 25-point programme and what were the consequences of this

Back

Preview of the front of card 3

Card 4

Front

Why did Hitler want to create a defence economy?

Back

Preview of the front of card 4

Card 5

Front

What does a policy of autarky entail?

Back

Preview of the front of card 5
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