Tooze's Wages of Destruction : An Inquiry

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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stg 44
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Re: Tooze's Wages of Destruction : An Inquiry

Post by stg 44 » 12 Aug 2012 16:34

Lend-Lease isn't factor into British production figures other than in machine tools and raw materials. Completed aircraft that are imported are not counted in British production.
What different requirements are you talking about? The British were producing more multi-engine aircraft of heavier weight than Germany was in 1941 and were producing more aircraft overall with 600,000 fewer workers.

http://www.amazon.com/Arming-Luftwaffe- ... ward+homze

http://www.amazon.com/Arming-Luftwaffe- ... niel+uziel
Other sources like Daniel Uziel, Edward Homze, and Richard Overy indicate that that factory floor space, raw materials, and machine tools dedicated to aircraft production were at least 1.5x as much as the British aircraft industry. Add in the 600,000 more workers and there was seriously something wrong with German production if the British were getting 8,000 more aircraft out of their industry than the Germans, despite the Germans gearing up their production pre-war in a war economy and dedicating more people, raw materials, machine tools, and factory floor space (by meters squared).

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Re: Tooze's Wages of Destruction : An Inquiry

Post by Cannae » 12 Aug 2012 18:33

stg 44 wrote:Other sources like Daniel Uziel, Edward Homze, and Richard Overy indicate that that factory floor space, raw materials, and machine tools dedicated to aircraft production were at least 1.5x as much as the British aircraft industry.
Could you please quote them on the matter? Especially for machine tools and factory floor space.

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Re: Tooze's Wages of Destruction : An Inquiry

Post by stg 44 » 12 Aug 2012 18:38

Cannae wrote:
stg 44 wrote:Other sources like Daniel Uziel, Edward Homze, and Richard Overy indicate that that factory floor space, raw materials, and machine tools dedicated to aircraft production were at least 1.5x as much as the British aircraft industry.
Could you please quote them on the matter? Especially for machine tools and factory floor space.
I don't own Daniel Uziel's book, Overy's Thesis was not published and I would have to travel out of state to even view that work, and I have to wait until next week until I can get back home to look into my copy of Homze. I'm more than happy to do so, but it will take me probably about a week or so to get the quote. Overy does have some information in "War and Economy in the Third Reich", which I have photo copies of, as well as in "The Air War in WW2" and "Göring: Hitler's Iron Knight". E.R. Hooton has some information about this as well, and I have copies of both his works on the Luftwaffe. Horst Boog has some information too in his various articles, some of which I have. It will take me time to compile the information, so if you have patience I can get it up in about a week or so.

http://ideas.repec.org/p/cam/camdae/0342.html
This doesn't focus on the aircraft industry, but the German and US machine tool stocks as a whole. Interestingly Germany had more machine tools than the US until about 1942.

Flexibility and Mass Production at War: Aircraft Manufacture in Britain, the United States, and Germany, 1939-1945 Author(s): Jonathan Zeitlin
http://www.bibsonomy.org/bibtex/2bcd903 ... arvardhtml
This gets into the different methods of the US, Britain, and Germany during the war, which shows Germans serious problems in that industry in relation to the Western Allies, mainly because of bureaucratic problems in and outside of production and procurement. There were even problems getting the right machine tools from Göring's '4 year plan', which ran the economy, not to mention just being able to coordinate with the broader economy thanks to Göring's absentee leadership of everything (Luftwaffe, German Air Ministry, the German War Economy through the 4 Year Plan Office) and creating competing bureaucracies in each organization so that he wouldn't be pushed out of power.

Just a quick addition, Overy talks about the mess the war economy had in 1939, as economic mobilization plans weren't ready in September 1939, so factories did not get allocated additional labor, nor start working on new war contracts until some time in 1940, because the competing bureaucracies were issuing different orders to factories, which responded by focusing on their pre-war orders until they got one definitive set of orders from the various bureaucratic organizations. There was a quote about this in "Iron Knight" and I can get the page number for you later. "Germany and Second World War" by the Bundeswehr's Military History Research Office also talks about this problem in their first of two volumes on the war economy in the series.
Last edited by stg 44 on 12 Aug 2012 18:55, edited 2 times in total.

Cannae
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Re: Tooze's Wages of Destruction : An Inquiry

Post by Cannae » 12 Aug 2012 18:42

stg 44 wrote:
Cannae wrote:
stg 44 wrote:Other sources like Daniel Uziel, Edward Homze, and Richard Overy indicate that that factory floor space, raw materials, and machine tools dedicated to aircraft production were at least 1.5x as much as the British aircraft industry.
Could you please quote them on the matter? Especially for machine tools and factory floor space.
I don't own Daniel Uziel's book, Overy's Thesis was not published and I would have to travel out of state to even view that work, and I have to wait until next week until I can get back home to look into my copy of Homze. I'm more than happy to do so, but it will take me probably about a week or so to get the quote. Overy does have some information in "War and Economy in the Third Reich", which I have photo copies of, as well as in "The Air War in WW2" and "Göring: Hitler's Iron Knight". E.R. Hooton has some information about this as well, and I have copies of both his works on the Luftwaffe. Horst Boog has some information too in his various articles, some of which I have. It will take me time to compile the information, so if you have patience I can get it up in about a week or so.
Ok. I am really busy on another forum so I can wait thanks.

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Re: Tooze's Wages of Destruction : An Inquiry

Post by stg 44 » 12 Aug 2012 19:15

Are you using this information for that other site? I added some links to my post above that you might want to check out.

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Re: Tooze's Wages of Destruction : An Inquiry

Post by Cannae » 12 Aug 2012 23:34

stg 44 wrote:Are you using this information for that other site? I added some links to my post above that you might want to check out.
No, the forum is mainly ancient military history. But I'll probably save your post on a word document in the future. Thanks.

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Re: Tooze's Wages of Destruction : An Inquiry

Post by LWD » 13 Aug 2012 20:33

stg 44 wrote:... And the US focused on a smaller number of aircraft type: B17, B24, P38, P40, P51. Sure they had many other variants, but if you compare the numbers of these 5 types with the other minor types, its obvious where the US focused its production. ...
Well both the F6F and the F4U have produciton numbers awfully close to the B17 accoring to:
http://en.wikipedia.org/wiki/List_of_mo ... d_aircraft
And using the same reference more P-47's were produced than P-51's and B-25's are just a shade under P-38's the same goes for the Avenger and the P-39. The F4F, Helldiver, Dauntless, and B-26 aren't that much further down either.

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Re: Tooze's Wages of Destruction : An Inquiry

Post by stg 44 » 13 Aug 2012 20:53

I don't specialize in the USAAF or US naval air force; I focus on the Luftwaffe as a main interest in the WW2 era.
Clearly I was wrong about the numbers of models the US produced, but that was a tangental point to the main focus of my post, which was that the German aircraft industry was badly mismanaged and inefficient, which I will provide quotes and information for in about a week.

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Re: Tooze's Wages of Destruction : An Inquiry

Post by paspartoo » 14 Aug 2012 08:25

Don't forget to quote Overy!

@LWD: Statistics for US aircraft can be found at the USAAF statistical digest http://www.afhra.af.mil/timelines/index.asp
table 76.
A simple economist with an unhealthy interest in military and intelligence history.....
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Re: Tooze's Wages of Destruction : An Inquiry

Post by pugsville » 14 Aug 2012 09:02

The German War economy can be BOTH fully mobilised (i.e. using near enough to the full manpower/resources it can) and inefficient and mismanaged.

Tooze is saying that German industry was generally pretty fully mobilised (production mainly constrained by lack of resources/labour ) NOT that it was producing at optimum efficientcy and organisation and NOT that the priorities of trek various things made was correct. Arguments that Germany produced the wrong things, wrong mix, wasted resources of bad Ideas don't really argue with Toozes main point.

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Re: Tooze's Wages of Destruction : An Inquiry

Post by LWD » 14 Aug 2012 14:49

paspartoo wrote:...@LWD: Statistics for US aircraft can be found at the USAAF statistical digest http://www.afhra.af.mil/timelines/index.asp
table 76.
Unfortunately that table only has info on USAAF planes and doesn't include stats for USN or Marine planes.

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Re: Tooze's Wages of Destruction : An Inquiry

Post by Cannae » 15 Aug 2012 03:18

I have copied and pasted the following quotes from Guaporense's threads for relevance:
Guaporense wrote:Also, you should consider the economies of scale involved: Germany produced 1,150 submarines during the war. As a result it's cost of production became very low, by 1943 the cost per ton of submarine was about half of the cost per ton of battleships.

Germany had very high levels of labor productivity where they achieved economies of scale. Such as submarines, production of medium bombers and production of single engine fighters. In these fields it appears that German productivity was equal or higher than in the US.
Regarding economies of scale, it is when a business expands its size of operations, not necessarily to do with solely output. Maybe you should produce a cost curve to supplement your point. Even better, there is multiple causes of economies of scale not related to a supply increase. There is also, good management, monetary phenomenons where interest rates are lower, or even technological origins. Do submarine markets really behave in a supply and demand mode?

In economic terms, are lower interest rates caused by a strong supply of bank reserves? In Germany, did fiscal policy trump monetary policy (Keynes) and such strategies as quantitative easing won't work, but government stimulus could create jobs? Is economic growth caused by technological innovation? Lastly, since good management can be a part of economies of scale, were such companies as Krupp, IG Farben, or Siemens poorly run?
South wrote:Review the economic doctrine of "place utility".
I think allocation of physical resources was very important in the Nazi economy, especially looking at the coal predicament the Nazis faced where transport by rail was insufficient to meet demands.
Pugsville wrote:Yes but exchange rates in the 1930s were pretty unreliable. No one really accepted other peoples currency, a lot of European trade moved into a Barter economy.
So, what was it that caused people to lose their demand of money? Since currency provides liquidity to solve transactions, the demand of money is usually regarded as a trade-off between the advantage of holding money and the interest favor of holding other assets. There is the ISLM model to estimate (not exact!) the demand for money in liquidity preference. Would be interesting to see where Guaporense would go with that.

Regarding the European trade, was there much free trade/low tariff zones around so that a deficient amount of foreign currency reserves could be made up for?
Guaporense wrote:using Friedman price index
Is this a reliable measurement?
Guaporense wrote:The Japanese discrepancy is greater due to the Balassa-Samuelson effect
But, this model only factors in the relationship between two countries rather than thinking of the economy as global, which it was. The model also assumes the wage (nominal or real?) is equal to the marginal product.

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Re: Tooze's Wages of Destruction : An Inquiry

Post by stg 44 » 15 Aug 2012 03:26

Cannae wrote:
stg 44 wrote:Other sources like Daniel Uziel, Edward Homze, and Richard Overy indicate that that factory floor space, raw materials, and machine tools dedicated to aircraft production were at least 1.5x as much as the British aircraft industry.
Could you please quote them on the matter? Especially for machine tools and factory floor space.
I have found a lot of information in those quoted works, but there are at least 3 dozen pages of relevant information about the inefficiencies in German production; I highly suggest you just pick up those books via interlibrary loan, specifically "Göring: Hitler's Iron Knight".

There are far more issues than what I mention below, so I suggest you do independent research to learn about the full scope of the problems German industry faced.

As to your specific question, I didn't find any numbers about British machine tools yet, but the link I posted above about American and German machine tools shows Germany with more stock than the US until 1944 and the British did not have as many as the US as far as I can tell. The Brits were in fact importing lots of these from the US during 1939-1941 for their aircraft industry according to "1940: Myth and Reality" and "Most Dangerous Enemy"
http://www.amazon.com/1940-Myth-Reality ... 1566630363
http://www.amazon.com/Most-Dangerous-En ... rous+enemy
The Germans also had more general purpose machine tools rather than specialized machine tools like the US and Britain; this was the decision of pre-war generals, who regarded mass production as inherently worse in quality to craft work by mastercraftsmen. Of course then there were limits to the number of craftsmen, who took a long time to train and were needed by the military. Also the workflow of craft work was inherently inefficient, as it utilized benchwork, rather than workflow production, assembly lines, and low skilled, easily trained workers.
The result was fewer, high quality products, which were hard to maintain in the field and didn't provide that much of a quality boost over mass manufactured products, especially when they required parts that weren't available and thus weren't available for fighting, so were essentially out of action.

Factory floor space is mentioned in Overy's "Air War": the British had about 22 million square meters while the Germans had about 35 million.
The Luftwaffe had 206,000 tons of Aluminum allocated, the RAF 161,000 tons. The Brits got 8000 more aircraft of heavier structural weight out of this.

The problem with the factory floor space, the numbers above including airframe, engine, subcontractors, etc., is that the British had much larger factories and few subcontractors, so they didn't have to transport parts to one place to be assembled, as everything was under one roof (minus engines). This was partly because the German Air Ministry didn't allow large plants to be constructed pre-war so as to not present a concentrated target for bombing. This was also because of the large use of civilian small businesses as subcontractors for German subassemblies, which relied on skilled craftsmen using benchwork, not assembly line mass manufacturing. This didn't really appear until 1942 and even by 1945 was still relatively uncommon. Airframe and engine manufacturing also used this benchwork, rather than work flow production and production with assembly lines and specialized machine tools.

The British also used 'shadow' factories, which were pre-war automotive factories converted to war work, which were concentrated and 'hidden' so as not to attract bombing attention; as a result the British didn't disperse production like the Germans.

pugsville wrote:The German War economy can be BOTH fully mobilised (i.e. using near enough to the full manpower/resources it can) and inefficient and mismanaged.

Tooze is saying that German industry was generally pretty fully mobilised (production mainly constrained by lack of resources/labour ) NOT that it was producing at optimum efficientcy and organisation and NOT that the priorities of trek various things made was correct. Arguments that Germany produced the wrong things, wrong mix, wasted resources of bad Ideas don't really argue with Toozes main point.
This is exactly Overy's argument and mine.

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Re: Tooze's Wages of Destruction : An Inquiry

Post by Cannae » 24 Aug 2012 23:57

I found a few notes from Richard Overy's How the Allies won the war that I would like to present in this thread, as well as in other articles.

As you said stg 44, German machine tools were more general purpose, to take up multiple tasks, whereas the machine tools in the United States and Britain were structured in a division of labor mode of production. Although such a decision by German generals would hinder higher levels of production, it was very resistant to any changes in weapons of choice, modifications, and such. So production was, arguably, concentrated on few weapons system. In short, they sacrificed quantity but gained quality. You're saying, though, that the maintenance of weapons was more difficult since there was less parts for them? Like what parts were difficult to acquire for the Panther or Tiger? German tools tended to last longer than American ones, once machine tools in the US had arrived their replacements were paid for. So while the Germans started off with more machine tools, this was vastly overcome by the rate of American mobilization and their purchasing standard.

In the Soviet Union, labor conditions were very unfavorable to the people as a whole. Overy on p. 187 states that all holidays and leave for workers were cancelled. Generally there was 12-16 hours of work and three hours compulsory overtime. All economic activities were governed by military law. Rationing was even worse. On the same page he gives, for miners and metalworkers, 2 pounds of bread per day along with 5 pounds of meat, a pound of sugar and a pound of fat per month. Food producers only got half a pound of bread and a potato or two each day (p. 188)

Another thing I would like to expand on, is the method of food production and such. Most inputs for the farmers were oxen to plow, since the army took the horses and tractors necessary to increase output. Was erosion or greenhouse gasing common? How much arable land was used in the Soviet Union compared to Nazi Germany? Did the supply of oxen in the Soviet Union fluctuate, and could solar energy help fuel the war effort?

Overy praises the United States' ability to produce, he gives the examples of Liberty ships. They were built in parts, away from the slipway, and then assembled there by modern welding methods. (p. 194) A mile from the shore, vast assembly sheds and storehouses were built. Don't you think there was considerable labor needed on the storehouses, also that they had limited carrying capacity?

The one definitive factory in Overy's account is Opel, but it was a foreign affiliate of General Motors. Not until 1942 were plans for mobilizing the company taking place. What took so long? He references his Göring book on pages 99 and 161 but I don't have those at the moment. There was also Wolfsburg, only twenty percent of it was utilized. (Why the Allies won p. 202)

[quote=”stg 44”]Also the workflow of craft work was inherently inefficient, as it utilized benchwork, rather than workflow production[/quote]

The advantage in benchwork is that it requires little machine tools, but Germany had more stock of it compared to the US until 1944. Was the benchwork technique ever abandoned at one point? Small businesses were employed maybe, because it was less corrupt and decentralized.

Surely, Britain as you said had less subcontractors and larger factories, it's strange to me how the British economies would have no problem since, due to having less subcontractors, there wouldn't be a higher profit rate that would encourage greed.

The article you gave me on page 4 conditions that European machine tools were “typified perhaps by the so-called engine lathe”.

On page 5 he gives the following figures for machine tool stocks:

Table 1. USSBS comparison of machine tool stocks
US STOCK
GERMAN STOCK
US ANNUAL ADDITIONS
GERMAN ANNUAL ADDITIONS
Jan-1940 942,000 1,177,600
Jan-1941 1,053,500 1,305,800 111,500 128,200
Jan-1942 1,246,500 1,437,800 193,000 132,000
Jan-1943 1,529,386 1,554,900 282,886 117,100
Jan-1944 1,770,935 1,656,800 241,549 101,900
Jan-1945 1,882,841 1,737,100 111,906 80,300
Source: USSBS Report 55, p. 3.



He mentions Stephen Broadberry's productivity race, which I found on Google Books here http://books.google.com/books?id=EfKyy2 ... ce&f=false .

Page 7: http://www.econ.cam.ac.uk/dae/repec/cam ... pe0342.pdf

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Re: Tooze's Wages of Destruction : An Inquiry

Post by stg 44 » 25 Aug 2012 06:53

Couple of things:
First, the Germans had problems providing enough parts for and complete units of engines for tanks and aircraft. This was because unlike the airframe or Panzer chassis industries, engine industries were not regulated until much later, were less funded, and had less space/work force/materials. Sadly there is very little in English or German on the topic (that I've found).

Benchwork required skilled labor, something that was increasingly in short supply in Germany (think master craftsmen with years of experience who were getting drafted) as the war went on. Deskilling meant more assembly line work with specialized tools and easier/quicker to train workers (slave labor), which increased standardization and conserved resource usage. Overy's books cite how machining practices improved, saving 1.5 tons of aluminum per BMW 801 engine for example.

The US and British also did not dig as deeply into their skilled labor, so had the ability to get better results that way, in addition to producing/importing specialized machines, which required little skill to operate and just needed oversight by an experienced foreman (i.e. the skilled laborer promoted). Also the British used fixed price contracts IIRC, which used greed to increase efficiency and production by tying profit to increased productivity at lower cost.

The Germans did not totally abandon benchwork, but did improve workflow and did shift to more assembly line work as the war went on. An earlier intervention by guys like Fritz Todt and Erhard Milch would and could have introduced these methods much earlier, at lower cost (thanks to avoiding producing too many general purpose machine tools), and have more special machine tools and easy/quick to train labor.

Also the US had plenty of labor despite conscripting so many men...they conscripted about as many men as Germany with twice the population. So the US never mobilized as much as the Germans, allowing them to have a much larger labor pool. The USSR was able to extract labor out of their population by tying their food to production, something that even the Axis would not get their populations to accept, but Soviet citizens had pretty much gotten used to it after decades of conflict and Soviet rule, plus harsh conditions under the Czar; in reality the harshness of Soviet WW2 production was only really sustainable in the USSR because of the unique history of the country and people.

The Soviet agriculture AFAIK was more run by tractors, as Stalin had modernized the country and developed experience for tank production through modernizing agriculture and freeing up farmers for factory work pre-war. As far as arable land comparisons, no idea, but the USSR lost their primary producer, Ukraine in 1941-2 and relied on the US for lots of food, which the US has always been a surpluser of. Solar energy was not a developed technology in WW2. Pollution was bad during the war and caused major climate issues, but different ones than today. The coldest winters to that point resulted from the constant smoke thrown into the atmosphere, which are technically green house gasses, but the density of smoke and such seems to have cooled things down during the war.

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