Was Germany's War Effort Badly Run?

Discussions on the economic history of the nations taking part in WW2, from the recovery after the depression until the economy at war.
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Guaporense
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Re: Was Germany's War Effort Badly Run?

#181

Post by Guaporense » 13 Apr 2010, 23:47

cueball wrote:Yeah, but where did it all go? I mean Russia produced the same number of aircraft, and 10,000 more tanks, and had 3 million more men in the field?

Sorry for being simplistic.
Let's compare individual categories:

First, we must know the relative weights of German armament production (on average, for 1944):

Aircraft: 40%
Ammunition and explosives: 30%
Tanks: 8%
total: 78% of all munitions production

Germany (39 billion RM worth of munitions)

35,600 combat aircraft
320,5 million rounds of artillery and mortar ammunition
495,000 tons of explosives
19,000 tanks

USSR (28 billion RM worth of munitions)

33,200 combat aircraft
173,4 million rounds of artillery and mortar ammunition
180,000 tons of explosives
29,000 tanks

Soviet output was greater in tanks than in other fields. In tanks, Soviet output was 152% of German output, while in combat aircraft, it was 93%, and in ammunition and explosives it was 45% of German output (the average between the ratios of artillery and mortar ammunition and explosives).

We can estimate total soviet output in proportion to Germany as:
40% x 93%
30% x 45%
8% x 152%
/78%
= 80.6% of German output. And that doesn't include the inferior quality of Soviet aircraft.

Sources:
German ammunition and Soviet ammunition and explosives *: http://www.sturmvogel.orbat.com/SovWarProd.html
German explosives, combat aircraft and tanks: The US Strategic Bombing Survey report on the German War Economy
Soviet combat aircraft and tanks: When Titans Clashed

* Soviet explosive production for the 46 months of the war was 600,000 tons (annual average of 156,000 tons), while munitions output for 1944 was 13% higher than for the other years. This implies in a annual output of 177,000 tons in 1944.

** I think that we can make very imperfect comparisons of the quality of Soviet and German aircraft by taking the root of their exchange ratios. In 1944 the USSR lost 9,700 combat aircraft to combat, while Germany lost 2,900 combat aircraft to combat in the eastern front, so they traded planes 3.34 to 1. That would imply, in a very rough calculation, that one German combat aircraft would be equivalent to 1.82 Soviet combat aircraft. Then Soviet combat aircraft production would have only 34,5% of Germany's value. With would imply in a total munitions output of 50,6% of German production, in 1944.
"In tactics, as in strategy, superiority in numbers is the most common element of victory." - Carl von Clausewitz

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Re: Was Germany's War Effort Badly Run?

#182

Post by cueball » 14 Apr 2010, 00:06

Inferior quality does not necessarily indicate less cost.


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Re: Was Germany's War Effort Badly Run?

#183

Post by Guaporense » 14 Apr 2010, 01:02

But it indicates less value. If you manage to produce munitions of greater value with less cost, well, it demonstrates greater efficiency, or wrong exchange rates to calculate munitions output.
"In tactics, as in strategy, superiority in numbers is the most common element of victory." - Carl von Clausewitz

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Re: Was Germany's War Effort Badly Run?

#184

Post by cueball » 14 Apr 2010, 01:58

I think you are muddying the waters here with unnecessary qualitative assessments. Very hard to determine anyway. For example, issues of combat losses can be attributed to training, also, combat rolls. By 1944, Germany was concentrating far more on aerial defense, whereas the Russians were more actively engaged in ground support rolls, and other high risk activities with combat losses come from other sources other than aircraft. If for example Germany had kept its JU-87 fleet in combat operation on the east front, as opposed to having them interdict the Murmansk convoys, the statistics might very well have been different.

Very murky stuff.

And none of that has to do with X input = y output. The materials needed to build a better plane are not necessarily substantially different from those required to build an inferior aircraft. It's more of an engineering issue.
Last edited by cueball on 14 Apr 2010, 02:05, edited 3 times in total.

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Re: Was Germany's War Effort Badly Run?

#185

Post by takata_1940 » 14 Apr 2010, 02:01

Hi Guaporense et all,
Guaporense wrote:But it indicates less value. If you manage to produce munitions of greater value with less cost, well, it demonstrates greater efficiency, or wrong exchange rates to calculate munitions output.
That's GIGO again!
You are making another complete useless analysis (due to usual flawed methodology) by comparing the relative value of German and Russian aircraft by their "exchange ratio".
I'm pretty certain that if the Germans had had ZERO aircraft flying in the Eastern front, the russian would have had lost almost as many aircraft than the figure you cited.

Reasons?
The Russian airforce was tasked mostly with tactical support duty all along the war and the huge majority of its combat loss came from the ground AAA defences. Something the Germans where pretty good at, while the russians did not compete into the same category. As the Russian commanders were pretty harsh, crews were expended to their maximum and the survivability rate was pretty low at each sortie. Hence, even if they had no air opposition at all from the Luftwaffe, it would have been made more ground attack aircraft (Il-2, Pe-2, etc.)and much less fighters to protect them. Consequently more losses, or at least an equivalent level, but probably higher overall.

How do you divide by zero to get your "quality" ratio then?

As a matter of comparison, you should look at the Western powers tactical airforce losses during the last months of the war when they had mostly achieved air supremacy over Germany (mean no more opposition/interference from the enemy air force during those missions). Losses were just horrific due to the flak alone. Then what you are computing this way is pure air.
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Re: Was Germany's War Effort Badly Run?

#186

Post by Guaporense » 14 Apr 2010, 02:24

One advantage that Germany had over the allies was their great machinery sector. Before WW2 Germany was the world's largest producer of industrial machinery, as result they started WW2 with the largest stock of machine tools in the world. And they still had more machine tools than the US until 1944:

Machine tool stock:
Germany USA
1940 - 1,177,600 ---- 942,000
1941 - 1,305,800 ---- 1,053,500
1942 - 1,427,800 ---- 1,246,500
1943 - 1,554,900 ---- 1,529,400
1944 - 1,656,800 ---- 1,770,900

Source: The Effects of Strategic Bombing on the German War Economy, USSBR, page 241

These machine tools made up a significant proportion of Germany's industrial capital. Second to Tooze, Germany's industrial capital stock was 70 billion RM in 1943, while Ger's machine tool stock (including some categories that weren't included in the comparison) was valued at about 10.75 billion RM (using the average price of 5,000 RM per machine). And the data for accumulation of industrial capital increased in the same rate as machine tool stocks.

The problem is that the US accumulated more industrial machinery than Germany, and second to the Toozians, the increase of the US munitions production depended less on accumulation of industrial capital than Germany (at least this is the deduction of their rationalization that Germany's munition production increased later, when the other major powers had already reached their peak and that this increase was the result of investment).

But the fact is that Germany's machine tool stock increased 7% between 1943 and 1944 while their munitions production increased 28%. While US's munitions production increased 11% between 1943 and 1944, while their machine tool stock increased by 16%.

And for Germany, most industrial investment occurred between 1938 and 1942, while munitions production increased the most between 1942 and 1944. The explanation that investment was the main cause of increased output in the later war years would imply that the vast majority of investment before 1942 was allocated to basic good industries and not to the armament sector. Also, the US apparently managed to accumulate industrial capital and produce munitions at the same time.

Granted that Germany had a much smaller workforce in munitions than the US. Takata estimated the German munitions workforce as 5.5 million in 1940 and 6.6 million in 1943. While the US had a total workforce in industrial munitions production of 13.6 million. On average, in machine tool using industries, Germany had 2.3 workers per machine tool, while the US had 4 or 5 and UK had only 5.7.
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Re: Was Germany's War Effort Badly Run?

#187

Post by cueball » 14 Apr 2010, 03:08

Guaporense wrote: And for Germany, most industrial investment occurred between 1938 and 1942, while munitions production increased the most between 1942 and 1944. The explanation that investment was the main cause of increased output in the later war years would imply that the vast majority of investment before 1942 was allocated to basic good industries and not to the armament sector. Also, the US apparently managed to accumulate industrial capital and produce munitions at the same time.
Why would it imply that? To me it implies that return on capital investment is not immediate.
Guaporense wrote:
First, we must know the relative weights of German armament production (on average, for 1944):

Aircraft: 40%
Ammunition and explosives: 30%
Tanks: 8%
total: 78% of all munitions production
Germany (39 billion RM worth of munitions)
40% = 15.6b RM
30% = 11.7b RM
8% = 3.12b RM

USSR (28 billion RM worth of munitions)

15.6 * .93 = 14.508
11.7 * .45 = 5.265b RM
3.12 * 1.52 = 4.74b RM

14.508 + 5.265 + 4.74 = 24.53b RM

Ok so who took my 3.487b RM?

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Re: Was Germany's War Effort Badly Run?

#188

Post by takata_1940 » 14 Apr 2010, 04:07

cueball wrote:
Guaporense wrote: And for Germany, most industrial investment occurred between 1938 and 1942, while munitions production increased the most between 1942 and 1944. The explanation that investment was the main cause of increased output in the later war years would imply that the vast majority of investment before 1942 was allocated to basic good industries and not to the armament sector. Also, the US apparently managed to accumulate industrial capital and produce munitions at the same time.
Why would it imply that? To me it implies that return on capital investment is not immediate.
He is implying that because he doesn't bother to look at what actually those machines tools were built for and what was their possible use in regards to increased military output. One may have 10 billion machine tools and still lack the good ones to process what he needs. And if it takes 5 years to build the good ones (as some machinery easily need), he will be left short the adequate machine tools for the projected output, beside being the richest in number.

What matter for comparison is not how many one have, but how much output (the same) could be produced per machine tool (of the same kind) between different country. If it is demonstrated that some capacity remained idle in Germany, what could have been the reason behind this fact? - (considered fact with relevant data, of course, not by gigoistic calculations).

. Lack of power supply? .. very unlikely in Germany.
. Lack of skilled operators? .. some replacement manpower needed quite some time before being able to produce.
. Lack of basic material for process? .. oh well, that may happen also: If one's got the machine tool capacity to process 10 billion tons of rolled steel but is only able to produce 5 billion tons, he either have to find somewhere another 5 billion tons supply that could be imported, either he will have to make investments into domestic production (if timely possible)... If none is possible, no other choice is left than to let half the machine tools idle in order to use half the precious workers elsewhere.

In any case, as cueball rightly pointed, the small number of workers per machine tools is rather a proof of German over-capacity (then investment wastage) than of good fortune, unless it has been soundly designed like that (very unlikely also) for absorbing many industrial losses during hypothetical future bombardments.

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Re: Was Germany's War Effort Badly Run?

#189

Post by Qvist » 14 Apr 2010, 12:07

Hi Cueball. Here I go and offer a fairly comprehensive, general and forceful argument against your post, and you respond to it by being reasonable and offering counterarguments that are worth addressing. What a refreshing change in this thread. :)
cueball wrote:Point being that when the chips were down, our GDP estimates don't seem help us much in coming up with simple figure that can be universally applied to define economic strength. Instead we end up having to explain prima facie statistical discrepancies when we measure the stats against the facts.
Agreed.

Yes. My point is directly this. It seems that we are talking not so much about war time economic management decisions, but changes that go further back.
And again.
Qvist wrote:Secondly, does it take into account that serial production of highly standardised models in new and larger plants are intrinsically more amenable to higher labour productivity than diversified production in smaller plants? Because the transition from the latter to the former is a product of investment, and has nothing to do with labour efficiency in the sense of better management practice.
Regardless, efficiency increases resulting from "learning by doing" would persist in either model of production. Do you see any reason why this would not be so? Remember we are talking about a relative increase in labour productivity, examined in one specific model (diversified production in smaller plants).
OK, so they have taken that into account (or rather, they have looked at an area where it doesn't apply). The basic point, however, is that all aspects of the war economy, including labour efficiency, were impacted by a lot of other factors as well as decisions motivated by other concerns. Hence, it cannot be understood as an autnomous phenomenon that developed according to some identifiable internal logic. In my opinion. the key figure of thought to apply, here as elsewhere in a war effort that was so strongly defined by constraints, is "trade-off", and trade-offs tend to be not even visible unless you put things into a wider context.
Am I wrong but is it not the case that single shift production was common, even at the end of the war. This would indicate under-utilization of capital
I don't really know much about that, good question.
Qvist wrote:Thirdly, theorising by extrapolation about the possibility of lower productivity in the mining sector having little to do with the nature of the labour is plainly nonsensical and possible only if one stubbornly ignores everything else than statistical modelling. The productivity of a miner who relies to a large extent on muscle power is largely a product of chaloric input. If you remove 50,000 skilled, reasonably motivated and comparatively well-fed German miners and replace them with 50,000 untrained, reluctant and chronically underfed prisoners of war, then productivity decreases - at the end of the day, if you eat less you hack less coal. For obvious reasons, they are not very similar to aircraft factories, and there is in any case no good reason to assume that the same dynamic of factors should determine the development of productivity in these two sectors.
The whole point of doing economic analysis of management systems is so that they can be applied in different areas of production.
Yes well, that may be desirable but it is also irrelevant relative to the issue of whether that analysis in point of fact is equally or roughly analogously applicable as historical explanations to the development of two different sectors of the German war economy.
Coal mining and aircraft manufacturing are both industrial processes. The article itself bases its analysis partly on previous work done on the US aircraft industry.
Even so, there were clearly important factors involved in the equation for the mining sector that did not apply in the same way to the aircraft sector, and vice versa. Also, see the authors' last sentence: More research is required in order to determine whether these conclusions can be applied to German industry as a whole. Which is essentially also my point.
I was surprised as well. The point is this: As counter intuitive as it is the conclusion is that the skill level of workers in aircraft production had little to do with actual labour efficiency increase, and the main benefit came from learned management skills, including worker training. The article goes into some depth on this topic, even undermining the intuitive belief that there was something more motivated about German workers. It seems that there was a rather high rate of turn-over of German workers, and the evidence they provide from the audits includes assessments where Czech and Ukrainian women press-ganged into aircraft production performed at 80-90% of comparable German workers.
I haven't read that bit, but at least as summarised here, that argument seems to me a bit simplistic. Regarding the productivity of foreign labor, that is rather extensively sourced (f.e. in Tooze) and there is simply no doubt that seen over the period as a whole, there was a big (if also gradually declining) productivity gap between German and forced labor. But actually that's an instructive issue, generally with this problematic we are discussing. During the early days of mass forced labor, in 1941-42, productivity was abysmal. This is not surprising given how the labourers were treated, with a horrenduous death rate (and corresponding absenteeism through illness) due to generally horrific living conditions and particularly very low rations. Gradually however, the system responded to this state of affairs and over time conditions improved, and so did the productivity. This of course fits into the narrative you are proposing: The Germans initially used the resources this labour group represented inefficiently. Over time, realising the consequences of this, they adjusted. Hence, increased productivity through better management.

But: Once you go even superficially into the nitty-gritty and particularly the wider ramifications, it is immediately clear that it is quite senseless to approach this as if it was purely or essentially a question of industrial management. Rather, it was a question firstly of resolving the consequences of what amounted to a systemic shock to the labour structure of the German economy. This means that a period of adjustment must reasonably be expected - it represents a problem that needed to be resolved. Secondly, the root causes of what was from a productivity point of view simply inefficiency was due to factors governed by entirely different logics. For instance, the disastrously low rations in 1941-42 were connected to a general food shortage in the German sphere of control. It required a major reorganisation of the food distribution of German-controlled Europe to change this, and this involved a number of very fundamental issues other than the productivity of industry. For another, that the phenomenon existed at all, and that it was so large, was intimately connected to the military situation and the manpower needs of the armed forces. In other words, what we are seeing is a process of trade-off between industry's need for efficient use of labour, and a number of other concerns: The army's requirement for manpower which was constantly desperate after December 1941, The limitations of the food supply and the political priorities and ideological ideas that impacted both on the general attitudes to foreign workers and POWs and on the distribution of scarce resources such as food. This trade-off was gradually resolved in a way that favored the needs of industry, but the key point is that the reason why this didn't happen more quickly or fully than it did has little to do with the ability to recognise bad resource management or identify the measures needed to rectify it, and a lot to do with a number of wholly other priorities.

The upshot of this is that it becomes rather pointless to treat the development of foreign labour productivity as if it was purely or essentially a development in management efficiency, or some sort of learning curve within industry. Nobody needed a learning curve to realise that you didn't get much efficiency out of a worker who collapsed from hunger on the factory floor, or that the benefits of training were rather limited by the fact that the average worker lasted 6 months before he had to be replaced.

Then of course you can simply observe the results, call that result "management efficiency" and lump limiting and impacting factors of all kinds into the big bag of reasons why the German war economy wasn't able to be as efficient as it could have been.

But analytically, that route comes with heavy penalties. Above all, it means that you end up with a concept of efficiency that is more a rephrasing of the question than an actual answer, because most of the things that matter with regard to an actual historical explanation have gone into that big bag. Secondly, it begs the question: You end up pre-judging the question of efficiency, by treating it not relative to the actual situation in which the German economy found itself, but according to an abstract standard. This ignores that economies in war do not exist for the purpose of maximising economic efficiency, but for the purpose of winning the war. Of course, in general one is conducive to the other, but so are a lot of other things - which again brings us back to the point of trade-offs. In any case, putting the issue on such terms imposes clear limitations on what you can use the concept for. Among the things you cannot reasonably do is to treat it as a more or less self-contained process. Many factors that have nothing to so with economic management but that had great consequences for economic management impinged; these must be accounted for. Another thing you cannot do is treat it as a comparative entity vis-a-vis other economies. These faced different circumstances, which as in the German case, impinged on the result to a greater or smaller degree. In the end, you can't escape froom these things if you want to make a viable historical explanation.
No?! Well it does in the terms that Albert Speer seems to define it. Since these along with some other things are touted by him as being improvements that went along with his management of the war industry through his department. This argument seems a little semantic, since we are basically talking to a great extent about how much Albert Speer's "reforms" impacted the German war industry.

Management? Adminstration? What terms do you prefer?
Well, that shows that this is not merely a question of nomenclature. The heart of the issue with Speer and his version of events is exactly that it emphasises management, administration or whatever we call it in order to account for results that can convincingly be to a considerable extent attributed to factors that do not fit comfortably under any of these headings - for instance, the heavy investments in productive capacity made during the early war years, the outcome of the power tug for manpower between the economy and the Wehrmacht, the extent and ramifications of forced labor, the choice to concentrate on standardised models of weaponry and the general priorities determined by people and staffs well outside Speer's remit. None of these things are wholly and simply questions of management of the economy in any sense of the word - they all involve decision makers with other concerns besides, and they all respond also to needs other than those of the economy. They are not, in short, economic management decisions and that alone. Surely if the Speer case is a lesson for anything, it is for the dangers of subsuming complex phenomena under general headings that sound convincing but ultimately belie realities.
Emphasis mine. Is it is the case that capital investment was being underutilized, as exampled by the fact that German factories continued in single shift production? If so, it seems to me that this is an example of "management practice" where more could have been done with less capital investment. Simple material shortages don't seem to account for this, since this is really a matter of where you deliver your stuff.
Again, I don't know the details of shift structure, but if so that's the first I hear of it. But in any case, that would be a simplistic conclusion. There is, for example, not much point in running double shifts if you lack the raw materials or electric power to run production on a 24/7 basis. Or if you lack the labor for doing so. Again, that would pose a question rather than provide an answer.

The essence of the argument is that capital investment is a form of war mobilization. I grant the right people have to redefine parameters, and such is useful, often. But, the discussion here seems to revolve around what constitutes war mobilization. Most people mean to say by war mobilization the production of tanks planes and ships, and putting men under arms.
Well, I would go so far as to say that any generally analysis of the German war economy that omits capital investment is automatically irrelevant, and completely useless. It is such a dominant and obvious factor in that economy for at least half the war that it is simply impossible to achieve even a basic adequate description of it without considering it. Also, it is not only an indisputably limiting factor on output early in the war, but also the better part of the explanation for the higher output late in the war.
Be that as it may, when I say "tangent" i mean it. A tangent does not necessarily mean that we have another "overly monolithic explanation" what it can mean, and does mean in the context of the article I highlighted, is that we have more information. We can debate for the better part of a fortnight whether or not the German war industry was inefficient because it was over-capitalized in the wrong industrial sector based on excessive projections of manpower and resource availability and whether or not this constituted mismanagement, or simply a strategic planning error, but its seems to me that regardless of whether or not Germany would have gotten more benefit out of more efficient use of existing capacity (more shifts at factories) or that major capital investment was needed sustain the war effort that was "more or less comparable, relative to their resources, to that of the other combatant countries," the fact is that they were unable to do so, until 1943, 4 years into the war, and this exhibits major structural and systemic problems on many levels, even if you assert that capitalization is war mobilization.
Well, I note that you are still assuming that it was inefficient, and that the issue consists in explaining why. As far as I can see, there is not really much of a case for considering it particularly inefficient. Certainly it was inadequate relative to what Germany needed, but that is an entirely different issue. You can say the same for almost any aspect of the German war effort, and what that reflects is fundamentally the inescapable limitations of German resources.
If they did not fully realize the potential of labour efficiency until 1941, this is still a very serious problem, one that the USSR may not have had to contend, regardless of capitalization -- a problem with very positive results in my view. Even in their "banner year" 1944, it seems they substantially under-produced the USSR, despite having 30% more GDP, based in conventional estimates.
1. What exactly is "the full potential of labour efficiency"? This I find a maddening aspect of much argumentation in this field, analytically speaking. People seem to assume that if signs exist that everything is not perfect, that means someone is being inefficient. As if there was some universal standard of perfect efficiency that could confidently be expected from everyone under all circumstances, unless someone fouled up. The issue need to be put in terms of what the actual resources and limitations of the German war economy were, what aims it employed for, what problems it was subjected to and who they were caused by and how effectively they managed to deal with that. On those terms, the German war economy was as far as I can see reasonably efficient, and there is no striking absence of failure to take advantage of obvious major potential that needs to be explained.

2. The Soviet Union did NOT outproduce Germany. Not in 1941, not in 1944. Certainly it produced more tanks, aircraft and howitzers. It also however produced a lot less motor vehicles, naval vessels, submarines and a copious number of other items. Basing comparison exactly on the items on which the Soviet war economy was overwhelmingly focussed while omitting many who were important in the German neccessarily makes the comparison pointless. Also, the point of capital investment comes into the picture here as well. You might have noticed that the peak year of Soviet tank production was 1942, which, I would bet, was also the year where they had the largest superiority over German tank production? Which sort of illustrates the cruciality of the early-war German capital investment, as well as the fact that the USSR didn't do much of it. This of course means that the USSR already possessed the requisite capacity at the outbreak of war while Germany was still developing it, but again, that is not a question of the efficiency of war economies but of fundamental facets of German and soviet industrial development broadly speaking in the preceding decades.
The need to efficiently mobilize manpower to existing infrastructure, and the necessity of increasing capital investment are very much part and parcel of the same picture, and neither contradict my assertion that the issue is not so much one of "policy" as per Galbraith, but that Germany "could not mobilize, (in key sectors, in the traditional sense of the word: produce tanks planes, and ships) in the same way that the USA and the USSR were able to do, regardless of the amount of [war time] capital investment."
Broadly sort of agreed, but a few points. 1) In order to assess that, you need a broader basis of measure for Soviet war production - which on any such measure did not outproduce Germany. The overall volume of German aramanents output was higher, as it should be. Secondly, this reflects above all deep-seated, general and long-term structural differences in the three countries' economies. The US had had generally significantly superior productivity to all of the European economies, and had been in that position for many decades prior to the war. Hence, that gap does not really reflect any particular shortcoming in the management of the German war economy, rather a long-standing relative structural inferiority in the European and general economy at large. The USSR on the other hand had recently (but well prior to German rearmament) industrialised consciously along lines focussed on military requirements, and as such had achieved an industrial basis capable of large outputs of a relatively narrow range of items. In the actual situation in which it ended up, this turned out to be well-suited to requirements since it faced a major land campaign and could also fill its gaps through lend-lease. But again, this is tradeoffs, governed by factors that go way beyond mere economic management. 3) Not REGARDLESS of capital investment. CI was not enough to overcome the basic inferiority of resources the German were struggling against, but the situation would have been drastically worse without it.
The last because it seems clear that capital investment was underutilized based on what I know: manpower.
Er, as someone engaged in research on exactly that point, I would have to say that the overwhelming factor connected to manpower was that there simply was far too little of it. There were panicky descriptions of the situation in this area as early as 1940-41, and it was a major problem from day 1 of the war. Certainly there was room for more efficient use of manpower, including in the army, but that is comparatively marginal. Considering that German decision-makers obsessed over the manpower issue for the whole duration of the war and the enormous energy expended on dealing with it, it seems rather strange to envisage that there was here any major untapped potential that was not associated with severe difficulties or penalties.
The point is that they could not do it, regardless of what position you take on the issue of capitalization. Where they capitalized for example, aircraft or tank production, might be a moot point. It might simply have been impossible.
Well, that depends on what "it" is, exactly? If you mean equal the economic output of its bloc of adversaries, or anything remotely close to it, that certainly was completely impossible yes.
On the other hand the Soviet Union was able to survive what can only be described as one of the most horrific disasters in military history for reasons that I am sure everyone here is aware of to one extent or another, because they were basically able to lose all their stuff and replace that within a year. Apparently, the Soviet Union did not need capitalize, in order to fight the war, that part of their "war mobilization" was already in place.
As per above, yes. Certainly the USSR was, relative to its overall economic resources, extremely extensively prepared for war. But then, what Stalin had to work with in the twenties is not the same thing that Hitler had to work with in the thirties.


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Re: Was Germany's War Effort Badly Run?

#190

Post by Jon G. » 14 Apr 2010, 17:16

Thanks for joining the discussion, Cueball. You raise some very good points. Many of them have been addressed already, so my answer will be briefer:
cueball wrote:...
Jon G. wrote:
Barring the advent of major, major new technology between 1941 and 1944, that is flatly impossible within normal economic parameters as far as I know. Especially when we consider that the normal trend for all warring nations was a drop in per-worker productivity - a tendency which BTW was very pronounced for German coal production.

It so happens that Tooze (on pp 437-440) takes serious issue with Overy's figures for the early war slump in productivity, in part because Overy apparently simply compares number of workers in war industries, on one side, to overall armaments output, on the other side, hence disregarding the investment in infrastructure and plant and also disregarding that any addition of new workers to the armaments industry will not become immediately apparent until the corresponding supply of raw materials has caught up - a point which Abelshauser (p 155) is also making, BTW.

Tooze follows through by describing how the increased investment in plants, infrastructure and raw material in fact did pay off in increased armaments output, most notably of aircraft, some six months down the line - incidentally about the time when Speer took over as armaments honcho.
Interesting discussion. Reflects some of the discussion material on other forums I post at.

I have to admit, I am a little flummoxed by arguments that get resolved in comparisons of GDP. In this aspect one really has to start question the value of GDP at assessing war making potential, since regardless of how GDP was used, the resulting difference between what the USSR was able to mobilize, and what Germany was able to mobilize with less theoretical GDP, is quite astonishing. Even after the sudden upswing in German production toward 1944, most standard GDP estimates still assess Soviet GDP at 75% of German GDP, but Russia is still outproducing Germany in most major armament categories.
I agree with you that GDP clearly has its limitations as a way of describing a nation's war-making capacity and potential. Things such as industrial potential, access to (and stocks of) raw materials (also related to stocks of foreign exchange), dependence (or non-dependence) on food imports and so on all contribute to reducing GDP in and of itself as a not very useful denominator of war-making potential.

But to be just a wee bit blunt about it, it is as far as I can tell only Guaporense who persists in chucking out-of-context figures which he does not himself understand into the discussion. I think the points about GDP as a useful denominator have been made quite thoroughly and quite eloquently upthread by the two Oliviers and others.
So I sympathize with any attempt to explain that using current figures. A case of the facts conflicting with the stats... so to speak.

In any case, more in line with your discussion points here, I thought this contribution here: Demystifying the German Armament Miracle During World War Ii: New Insights from the Annual Audits of German Aircraft Producers received less attention than it should. It says some interesting things that might be applied both to the issue of the coal shortage, and production overall. It is based on audits of the German aircraft industry, which is interestingly outside of the domain of Albert Speer's ministry until 1944.

It would suggest that the sudden explosion of aircraft production in 1943 has roots that go even further back, to decisions made in 1937, and that the rationalization system of industry that Speer asserts is his own, is actually the results of lessons learned from Junkers rationalization of the aircraft industry beginning as early as 1939. Two key points being, the reduction of model types into a few designs, and the use of "fixed-rate" contracts.
Try as I might, I couldn't open the article which you link to, so in a way I am posting my response blindly. But from your presentation, you seem to be making German aircraft procurement plans and policies a good deal simpler than they actually were ( - I know, not really fair, considering that you're just summing up main points); there was a good handful of production plans in play both prior to the war and during it - for example the higher priority assigned to bombers post-Munich crisis, and various plans at various times increased or decreased the number of types and models to be built.
This article clearly indicates that increase in productivity had as much to do with "learning curve" as it has to do with capital investment, or supply of materials. Speer steps in to take credit for an industrial revolution years in the making, but its a revolution in management practice, not just capital investment.
Right, but theories of mass production, economies of scale and associated learning curves were well understood at the time and also attempted put into practice. For example, the plan for production of the Ju-88 was massive right from the start, with six major manufacturers (Henschel, Dornier [two factories], Heinkel, Siebel, Arado and ATG), plus of course Junkers themselves, plus a myriad of sub-contractors involved right from the start.

In other words, mass production, German style, was well underway long before Speer took over.
The analysis determines that learning curve efficiency and labour productivity has more to do with management practice than it does with the qualities of the labour itself. This would go against argument suggesting that removal of skilled or semi-skilled coal mining labour from coal mining would be the cause of reduced capacity for producing coal. This article exhibits that the labour force used in the aircraft industry was fairly transient, had high turnover and sourced labour from foreign worker pools, POW's and concentration camps, like the coal-industry, and that it still increased labour cost efficiency, suggesting that the primary transmitter of learning curve efficiency was management, regardless of the skill of the labour.
I am not sure how far you can take a comparison between coal-mining and building aircraft? One might be, or become, a good coal miner provided one is young and strong (qualities also desired by the army, meaning that armed forces and the coal mining industry were competing for the same type of men), but it takes more specialized skill to build aircraft. Although economies of scale achieved from mass-production methods can at least spread the skill required so to speak.

I've been struggling with my work scanner to produce a scan of per-capita coal miner productivity (from John Gillingham Industry and Politics in the Third Reich, p. 113) and will return once I've figured it out. Suffice to say that per-worker productivity (as opposed to overall production) dropped quite consistently as the war went on; bluntly put the Germans put more and more less and less motivated (and hungrier and hungrier) men down the mineshafts to compensate for the ongoing drop in per-capita productivity.

EDIT: and here is the promised table:
Image
It also shows through these company audits that indeed, labour efficiency was substantially increased over the course of production of JU 88's between 1939 and 1944, and labour costs were reduced by 60%. So, I don't find this totally out of line with the labour efficiency estimates presented by Guaporense. He also brings to the discussion important points about the rapidity of Soviet and US conversion to the war economy, which do need to be explained...
Right, I still haven't read the paper, but I will reserve the right to remain highly sceptical about that. Meaning, that once the whole Ju-88 mass production malarkey got underway - and there were hickups in the process chiefly due to the many different manufacturers involved - I am sure that production time for Ju-88 airframes and engines might very well have dropped.

On the other hand, a 1940 (the year it went into mass production) Ju-88 is a quite different beast from a 1944 Ju-88. The former is a state-of-the art medium bomber for its time, but not particularly complicated as bombers go, whereas the latter was usually a night fighter, bristling with radar and advanced electronics, light-cell operated high-caliber automatic guns and a host of other advanced (for the time) installations. So I doubt if a finished Ju-88 night fighter could be completed in 60% or less of the time it took to build a Ju-88 medium bomber.

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Re: Was Germany's War Effort Badly Run?

#191

Post by LWD » 14 Apr 2010, 18:26

cueball wrote:... And none of that has to do with X input = y output. The materials needed to build a better plane are not necessarily substantially different from those required to build an inferior aircraft. It's more of an engineering issue.
A good example of this might be US fighter aircraft. My understanding is in round numers a P-38 cost ~$100K, a P-47 ~$75K, and a P-51 ~$50K. I'm a fan of the P-38 but there's no way I'll claim it was twice as good as a P-51 and there are very good arguments for late model P-47's being as good as the P-51. Where does that leave this whole line of analysis? It doen't even work where a lot of factors are held constant.

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Re: Was Germany's War Effort Badly Run?

#192

Post by cueball » 15 Apr 2010, 04:24

Thanks for all the replies. It would take a very long time to respond thoroughly to all these points, and considering I have not yet read Tooze's book, I don't think it would make sense for me to engage in an argument against points that I have not properly researched. So, please accept my comments in the spirit of auxiliary information presented outside the context of Tooze's specific view that may be helpful overall.

That said, a few thing have surfaced in this discussion which I do feel somewhat competent to comment on, since I have read both Speer and Galbraith, and to make myself clear, I don't consider either to be unbiased sources, or one untainted by self interest. What I most dislike about Galbraith's summary that begins this thread is that it is basically unvarnished polemic, something that detracts from its value as a historical source. This is not to say that it does not hold value, because he does raise some important points, and certain information that we can take at face value, unless we find out otherwise.

In particular, it is worthy to note that he briefly touches on the aborted 1938 officer's putsch against Hitler, and this should be a reminder that in fact this discussion in many ways is a retroactive reprise of the policy debate happening at the highest levels of the German elite prior to the war. Indeed, the debate about the long term strategic view, is central to that debate, wherein Halder is essentially arguing that Germany is not properly prepared to go to war, and wont have the capacity for it until the middle of the 1940's. This is set against Hitler's view that the strategic initiative should be taken early, and that this will compensate for any lack of preparedness.

Early success seems to vindicate Hitler, historically, while it seems the implications of Tooze's view as summarized here vindicates Halder, as do the actual production stats. It seems pertinent to point out that the essentials of this debate were had in detail, and that the German military command did not go in blind, and a decision was made, based on a fairly accurate appraisal of Germany's war making potential.

If I recall correctly, Herman Goering's position is somewhere in between the two views. However, given the way the war worked out, I find it very hard for me to dispute Galbraith's contention that 1939 was Germany's best window of opportunity.

Inside the Third Reich is to my mind one of the most brilliant examples of complete intellectual and moral fraud ever put to paper. Somehow, Speer manages to apologize to his victims, many of whom he directly participated in subjugating, (take credit for "saving" them) and at the same time essentially claim that under his guidance he could have won Hitler's war for him. The fact that the better part of the book is devoted to the latter, rather than the former indicates where he really stands from a moral perspective.

One asks, had he achieved his primary aim, would he have spent any time apologizing at all? Very doubtful. Lets just say, it is obviously self-serving, and extremely so.

That said, it is also one of the few first person sources that we have available on the German war industry so even if I think it should be read with a jaundiced eye it does have information well worth reviewing in the context of this discussion, and as it happens I have been reviewing it again since I picked up on this thread topic.

Regarding the question of investment wastage, here is what Speer has to say:
Of all the urgent questions that weighed upon me during my first early weeks in office , solution to the labor problem was the most pressing. late one evening in the middle of March, I inspected one of the leading Berlin Armaments plants, Rheinmetall-Borsig, and foung its workshops filled with valuable machinery, but unused. There were not enough workers to man a second shift. Similar conditions prevailed in other factories. Moreover, during the day we had to reckon with difficulties with the electricity supply , whereas during the evening and night hours the drain on the available supply was considerably smaller. Since new plants worth some 11 billion marks were being built which would be faced with shortages of machine tools, it seemed to me more rational to suspend most of the new building and employ the labor force thus released to establish a second shift.
Inside the Third Reich by Albert Speer Macmillan Hardboun Edition 1970, pg 217-218

Like, Galbraith's polemic, I don't see why this statement should not be taken at face value, whatever particular bias may taint the value of the work in terms of its analysis.

The chapter then goes on to describe how the effort to cut back on capital investment, and redirect labour to production was undermined by one means or another, and then asserts that this was a direct cause of the need to start staffing new factories with imported labour of one kind of another. How much of his conclusion about how the decision to import labour came to be taken is anyone's guess, but I see no reason to dispute Speer's claim that capital was chronically underutilized.
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Re: Was Germany's War Effort Badly Run?

#193

Post by takata_1940 » 15 Apr 2010, 07:03

cueball wrote: Regarding the question of investment wastage, here is what Speer has to say:
Of all the urgent questions that weighed upon me during my first early weeks in office , solution to the labor problem was the most pressing. late one evening in the middle of March, I inspected one of the leading Berlin Armaments plants, Rheinmetall-Borsig, and foung its workshops filled with valuable machinery, but unused. There were not enough workers to man a second shift. Similar conditions prevailed in other factories. Moreover, during the day we had to reckon with difficulties with the electricity supply , whereas during the evening and night hours the drain on the available supply was considerably smaller. Since new plants worth some 11 billion marks were being built which would be faced with shortages of machine tools, it seemed to me more rational to suspend most of the new building and employ the labor force thus released to establish a second shift.
Inside the Third Reich by Albert Speer Macmillan Hardboun Edition 1970, pg 217-218
Like, Galbraith's polemic, I don't see why this statement should not be taken at face value, whatever particular bias may taint the value of the work in terms of its analysis.
Hi cueball,
I do agree with most of your points so far that there was investment wastages inside the Reich Economy and I would add few remarks on the subject:
Speer's comment -which I'm also taking as its face value- beside many others he made about the situation he faced when taking over the war production, seems right but his conclusion or solution seems also wrong:

1) about unused machine tools, the people involved into making the new plants were not interchangeable (in the short term) with those involved into war production: construction workers were always abundant (anybody could be used) while industrial workers were always in very short supply. Moreover, the "unused" machine tools at those plants indicated could have been shipped to equip the new plants being built. What he is saying then is that the machine tool park was overall underutilized (or over-sized).

2) he also doesn't take into account the main problem which was the production supply with high grade steel and others various items while it was the basic output limitation: if 10 plants working single shift could have the same cumulated output as 5 plants working double shift, 10 plants working double shift will need twice the manpower AND supply (basic products + energy).

3) Amongst the shortages, the primary suspect was always high grade steel products. But, at the same time, steel output was below peacetime level almost everywhere in Germany. What made the limitation of steel output was the cumulation of several factors: a) losses of highly skilled manpower drafted; b) lack of raw materials like raw iron ore; c) lack of fuel (coke and coal). The solution to a) was outside Speer's control but related to Wehrmacht needs. b) was caused by geopolitical consequences of the war: lack of importation market, lack of foreign change, lack of domestic supply. The solution to c) was not only to rise coke & coal output but was limited by shipping problems: the German Railways could not supply the metal working industry with enough coal during certain periods (Winter bad weather, Wehrmacht high operational needs, trafic over-extension rising with Eastern front supplies, etc.) and coal production was sometime reduced when backlog-shipments reached a too high level.

4) the example above is also showing that investments in the transport sectors were not made accordingly with industrial investments (like machine tools or plants buildings) or strategical planning. This deficient planning was during the period 1933-1938. When war broke out, Germany's DRG had less locomotives that she had before the 1929 crisis:

.1928: 26,500 (Altreich)
.1937: 21,618 (Altreich)
.1938: 21,866 (Altreich)
.1939: 25,580 (Altreich, Austria (parts), Sudetenland)
.1940: 28,299 (Altreich, Austria (complete), Sudetenland, Upper Silesia)
.1941: 29,679 (Altreich, Austria, Sudetenland, Upper Silesia, Alsace-Lorraine, Luxemburg, Byalistok)

A crash program of 10,000 locomotives was initiated during 1941-1942 (at war output expense, mainly tanks, which were built by the same plants) but effective only by 1943-1944. Prior to that point, the main contribution to resolve those many shortages came from occupied territories (France, Belgium, Netherlands, Luxemburg, Danemark, Norway, Poland..)
Example: an inventory made 1st September 1943 by the French Railways counted (both zone occupied/non-occupied):
. locomotives: 11,300 out of 15,927 (1939) - all the more powerful were taken over.
. wagons: 210,000 out of 434,000 (1939)
. cars (personnel): 17,700 out of 27,500 (1939)
Concerning the trafic with the remaning stock, 35.9% was allocated to occupation forces. Beside the situation was not the worse at that point, many rolling stock and locomotives having already being returned from Germany. But, at the same, time, the Germans asked for more coal, steel & iron output from those occupied Industries which of course could not work at full capacity without all their means.

The conclusion is that problems with shortages or excess capacity are sometime fully circular as one sector's shortages may cause over capacity in other one. What is important is the balance of the whole system and its clear limitations. What Speer tried was to patch and reorganize several sectors due to unbalanced capacities, but overall, this was possible because at this time, it was also clear what was the strategical priority (defense) when at other stages of the planning, particularly in the aircraft industry, the forecast planning changed from one priority to another which impacted severly any high output tentative.

S~
Olivier
Last edited by takata_1940 on 15 Apr 2010, 08:25, edited 1 time in total.

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Re: Was Germany's War Effort Badly Run?

#194

Post by bf109 emil » 15 Apr 2010, 07:31

Guaporense wrote:One advantage that Germany had over the allies was their great machinery sector. Before WW2 Germany was the world's largest producer of industrial machinery, as result they started WW2 with the largest stock of machine tools in the world. And they still had more machine tools than the US until 1944:

Machine tool stock:
Germany USA
1940 - 1,177,600 ---- 942,000
1941 - 1,305,800 ---- 1,053,500
1942 - 1,427,800 ---- 1,246,500
1943 - 1,554,900 ---- 1,529,400
1944 - 1,656,800 ---- 1,770,900

Source: The Effects of Strategic Bombing on the German War Economy, USSBR, page 241

These machine tools made up a significant proportion of Germany's industrial capital. Second to Tooze, Germany's industrial capital stock was 70 billion RM in 1943, while Ger's machine tool stock (including some categories that weren't included in the comparison) was valued at about 10.75 billion RM (using the average price of 5,000 RM per machine). And the data for accumulation of industrial capital increased in the same rate as machine tool stocks.

The problem is that the US accumulated more industrial machinery than Germany, and second to the Toozians, the increase of the US munitions production depended less on accumulation of industrial capital than Germany (at least this is the deduction of their rationalization that Germany's munition production increased later, when the other major powers had already reached their peak and that this increase was the result of investment).

But the fact is that Germany's machine tool stock increased 7% between 1943 and 1944 while their munitions production increased 28%. While US's munitions production increased 11% between 1943 and 1944, while their machine tool stock increased by 16%.

And for Germany, most industrial investment occurred between 1938 and 1942, while munitions production increased the most between 1942 and 1944. The explanation that investment was the main cause of increased output in the later war years would imply that the vast majority of investment before 1942 was allocated to basic good industries and not to the armament sector. Also, the US apparently managed to accumulate industrial capital and produce munitions at the same time.

Granted that Germany had a much smaller workforce in munitions than the US. Takata estimated the German munitions workforce as 5.5 million in 1940 and 6.6 million in 1943. While the US had a total workforce in industrial munitions production of 13.6 million. On average, in machine tool using industries, Germany had 2.3 workers per machine tool, while the US had 4 or 5 and UK had only 5.7.
are you quoteing from the same poor source as discussed in another threadhttp://forum.axishistory.com/viewtopic. ... 5#p1452820 and quoting from the same exact page 241 of the same source...maybe you should also paste the source so readers can see how the claims are bias and faulty showing not a single machine tool was taken into account as lost through air bombardment for the entire 6 years of war!!! what a joke...p.s. in the end what did Germany have to show for an effectively run war effort if indeed it was not bad after spending billions in RM, having it's citizens killed by allowing poor leadership to continue on with the war, allowing it's cities to be razed to the ground by a poor run Luftwaffe and AA, allow it's armies to not hold a single victory from 1941 on other then squat upon land, inflict casualties and then retreat shaken.

source as quoted from showing how illegitimate the facts and source are that was used to some how make a posting...note read the #2 of the reference showing the incomplete data from the source used by Guar'

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Re: Was Germany's War Effort Badly Run?

#195

Post by bf109 emil » 15 Apr 2010, 07:59

Guaporense wrote:
cueball wrote:Yeah, but where did it all go? I mean Russia produced the same number of aircraft, and 10,000 more tanks, and had 3 million more men in the field?

Sorry for being simplistic.
Let's compare individual categories:

First, we must know the relative weights of German armament production (on average, for 1944):

Aircraft: 40%
Ammunition and explosives: 30%
Tanks: 8%
total: 78% of all munitions production

Germany (39 billion RM worth of munitions)

35,600 combat aircraft
320,5 million rounds of artillery and mortar ammunition
495,000 tons of explosives
19,000 tanks

USSR (28 billion RM worth of munitions)

33,200 combat aircraft
173,4 million rounds of artillery and mortar ammunition
180,000 tons of explosives
29,000 tanks

Soviet output was greater in tanks than in other fields. In tanks, Soviet output was 152% of German output, while in combat aircraft, it was 93%, and in ammunition and explosives it was 45% of German output (the average between the ratios of artillery and mortar ammunition and explosives).

We can estimate total soviet output in proportion to Germany as:
40% x 93%
30% x 45%
8% x 152%
/78%
= 80.6% of German output. And that doesn't include the inferior quality of Soviet aircraft.

Sources:
German ammunition and Soviet ammunition and explosives *: http://www.sturmvogel.orbat.com/SovWarProd.html
German explosives, combat aircraft and tanks: The US Strategic Bombing Survey report on the German War Economy
Soviet combat aircraft and tanks: When Titans Clashed

* Soviet explosive production for the 46 months of the war was 600,000 tons (annual average of 156,000 tons), while munitions output for 1944 was 13% higher than for the other years. This implies in a annual output of 177,000 tons in 1944.

** I think that we can make very imperfect comparisons of the quality of Soviet and German aircraft by taking the root of their exchange ratios. In 1944 the USSR lost 9,700 combat aircraft to combat, while Germany lost 2,900 combat aircraft to combat in the eastern front, so they traded planes 3.34 to 1. That would imply, in a very rough calculation, that one German combat aircraft would be equivalent to 1.82 Soviet combat aircraft. Then Soviet combat aircraft production would have only 34,5% of Germany's value. With would imply in a total munitions output of 50,6% of German production, in 1944.
lets not forget how powerful a foe the USA was with supplying Russia with lend lease as supplied to Russia alone accounts for why the Soviet Union never had nor was left in a shortage of explosives...
Diphenylamine 3,208 million pounds
Dynamite 70,412 million pounds
Glycerine 14,575 million pounds
Hexamine 19,868 million pounds
Nitrate of Soda Gelinite 12,550 million pounds
sourced from page 12 of lend lease shipments of WW2 url or link showing this along with a complete list of Ordnance--Ammunition & Explosives supplied by the USA to numerous countries and totals herehttp://www.ibiblio.org/hyperwar/USA/ref ... ip-3C.html

thus trying to show what the Soviets made regarding explosives and not correctly including those sent to her via LL show a certain lack of research as to the strength of the Soviet Union...for instance citing the Soviet Union as producing only a total of 660,000 tons of explosives over the course of the war might be correct, but showing Germany made a paltry 495,000 tons of explosives in 1944 (arguably their biggest production year) fails in comparison to say simply Canada that made over 2 million tons of explosives over the course of the last 5 years almost equal to the mighty Germany from a Nation 1/8 her population.
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