The state of the economy in Nazi Germany

Discussions on the economic history of the nations taking part in WW2, from the recovery after the depression until the economy at war.
StevenStanleyBayes
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The state of the economy in Nazi Germany

Post by StevenStanleyBayes » 04 Aug 2016 03:25

I have found this : http://www.nber.org/chapters/c2510.pdf

I have been interested in this topic as well as the Nazi Economy. To find accurate material is difficult as people do not publish this because they are afraid.

In general :

Germany had the highest standard in the world in the period of 1932 to 1944. This included : the highest salaries, the lowest prices, the most free products ( such as medicine, education, etcetera ), the highest product availability, the highest product quality, etcetera.

All this from real economy such as high tech and important machine industries and not from McDonald's.

This has been achieved despite the isolation and embargo and non convertible currency imposed by the UK, France and the USA and other. The Soviet Union was a closed system in respect to all other countries while the UK, France and the USA were closed to Germany only ( the USSR did not allow any export nor trade to these countries ).

The isolation, embargo and, mainly, the non convertible Reich Mark were one of the reasons for the war and a very big reason too.

The high standard of Germany meant the capitalism and the socialism were over mainly the UK, France and US capitalism where people wanted to have the much better system of Germany.

Churchill and Roosevelt did not have any other choice but war. Either this or their capitalism was over. Everyone, even the capitalists, wanted the national socialism of Germany which will continue to make the capitalists rich and much more stable. The people wanted this system too for the said reasons.

Stalin responded with a huge jump of the economy for the people sector and reached Germany in standard in 1939 and 1940. The intensive collective agriculture proved to be stronger than the German extensive farm system. Along with the food which had previously been a problem, high tech and machines were better or the same in quality and huge in quantity as the German system, which kept the private ownership although with government management, was not able to make quantity and there was not much room for quality because everything then was extremely simple and everyone, who has a good economic system, can do.

The inquisitive Germans realised this and started to ask themselves the question whether Soviet Socialism is better than their National Socialism. Hitler started to lose the most important advantage : better standard for all people. This was one of the reasons why Hitler attacked the USSR : to stop them before the Germans decided to switch to Socialism.

This way, from the economic prospective, everyone wanted war except the USSR. Germany, however, wanted the war with USSR the most because they were their only competitors.

With this said, here is the situation in Germany in 1932 to 1944 :

Free Healthcare
Free Education
Guaranteed Income
Top Salaries from Real and Important Jobs
Low Prices
Apartments and houses for All
Guaranteed Bank Accounts
Guaranteed Non Exploitation ( better said Decreased Exploitation )
Guaranteed Piece Before the War ( no one would attack Germany )
Guaranteed Holidays ( 2 Weeks )
Guaranteed Statutory Holidays

Problem : Huge Bureaucracy

The average German family would have HOME and FOOD without a problem at extremely low, government controlled, prices. They would have home machines ( appliances ) such as stoves, refrigerators, laundry machines, vacuum machines, bicycles, musical instruments, radios, TV's ( in the 40's ) etcetera. Most of them would have a car. Most farmers would have tractors. Big farms would have combines. Towards the 40's, most production, industrial and agricultural, would be machine driven only, i. e. the German worker did not do manual labour.

There was no repossession system and there was no way to loose what you have : the government would help.

There was a social security system used in the early 30's. The system remained but was not used because there were no people without a guaranteed income.

There were no strikes and sabotages ( not allowed ), thus, people would not loose income. Labour problems were decided by the party hence there was no need for strikes and sabotages.

Not only was Germany better than the UK, France and the USA but was light years ahead in EVERYTHING, also, in science and technology. Not very well known fact was the Germans discovered the nuclear fusion ( bomb ) in 1938. The bomb was difficult to build though yet the possibility of such made Hitler paranoid because other nations could attack Germany and destroy Germany very easily with the bomb. Hence another reason to try to start the war faster before the UK and France were able to destroy Germany.

Even more : People in the UK, France and the USA NOW, more then 80 years after the war, are much worse off as compared to the people in Germany 80 to 90 years ago! Because the USSR was destroyed, people in the former republics now are also much worse off then the people in Germany 80 to 90 years ago!

Those who think this is propaganda : try to speak to old Germans OUTSIDE Germany who remember or have been told by their parents what marvellous country Germany has been for the German people. Please, note : Germans inside of Germany are not allowed to talk positive of the period and may be persecuted with a possible jail sentence of 1 to 2 years.

Deutschland was really uber alles countries in der werld!

GregSingh
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Re: Salaries in the Nazi Germany

Post by GregSingh » 05 Aug 2016 00:36

:welcome:
To find accurate material is difficult
You can find it more or less easily when you care to look. Just because sometimes it's not available outright, it doesn't meant we should go along and make things up... What's your sources for all those claims in your post?

I would like to see data for German household ownership of "refrigerators, laundry machines..TV's" during 1933-1945. Specially TV's.

Also in my experience nothing is free in this world (perhaps with the exception of the air we breathe) and in the end somebody is paying for "free" services. So how these "free" services were financed in the Third Reich and for how long these would continue, not for thousand years for sure.

If things were so hunky-dory in Third Reich, why would Hitler attack the USSR to stop Germans switching to Socialism???
If we become increasingly humble about how little we know, we may be more eager to search.

StevenStanleyBayes
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Re: Salaries in the Nazi Germany

Post by StevenStanleyBayes » 22 Apr 2017 08:17

Answers in reverse order :

1. Hitler was afraid Germans would switch to socialism after the advances and achievements of socialism in 1939, 1940 and, most importantly, 1941.Without the war, socialism was to outperform National Socialism which had already outperformed capitalism in The US and everywhere in the world.

2. There were two TV systems in the UK. One of them was a mechanical ( electromechanical ) one. Germany invented and improved the fully electronic TV where an analogue signal is transmitted by means of electromagnetic transmission to be received and converted to control the beam of electrons which hit a luminophor with different strengths from 0 ( black ) to maximum ( white ) and everything in between ( shades of grey ). The Germans ( Siemens ) mounted a Cathode Ray Tube next to a speaker and electronics ( tubes ) behind to make the first analogue, mono TV set. There was a German program every other day. Because Dr. Goebbels saw the power of TV, many Germans owned a set and all of them owned a radio. A picture of Dr. Goebbels personal set, captured by the Allies, is available online as I have personally seen this in a documentary. More, the Berlin Olympics were one of the first TV program. This is a well documented fact. Hollywood uses this fact in many movies to say the extraterrestrials ( imaginary ) have detected this first TV signal and develops the idea to make movies.

3. A refrigerator is a simple ELECTRICAL and not electronics device and has been around since the 1910's. There has been more than 20 years of development until the 30's. The first fridges were dangerous. Then they became safe yet they used dangerous chemicals. In the 30's, after personal involvement of Dr. Einstein of Princeton, the fridges started to use non dangerous chemicals. However, in the 30's, even the ones which used dangerous chemicals were very safe and mechanically strong. Germany had the first Tesla system ( 50Hz AC ) in the 1800's made by AEG. They had commutator based DC systems ( Edison systems, DC ) before. The whole Germany had 50Hz, 220V AC in every house in the 30's.

4. Laundry machines are also simple electrical devices and not electronics. They have been available even before the electricity, powered by engines with internal combustion. Because laundry machines use nothing but a simple AC motors, they were fully available in Germany in the 30's. I have personally owned one of the same type ( not German ) : There is a big cylinder, around a meter tall and around 75 cm wide. At the bottom, there is a propeller which is driven by a motor positioned under the cylinder. Amazingly, the isolation was OK an no water went through the shaft of the propeller into the motor compartment. Water is poured from the top and drained from the bottom through a hose into the canal in the bathroom. ( In Germany, as well as in the whole continental Europe, bathrooms are made of water tight mosaic and there is a canal, usually in the middle : the hose goes into this canal ). There were other models with a motor on the top and propeller down. The propeller was protected by a grill ( bar ) so no clothes touch the propeller and the propeller churns the water which churns the clothes. All these machines are 90% automated : one must only put water and drain water. Rich people owned drying room : a room where the clothes are hung and electrical or other heathers dried the clothes. When the weather was good, the sun did so in the same room with large windows ( similar to a green house but with open windows for aeration which provided extra drying ). Poor people used balconies, yards and their own rooms to dry.

5. All Germans were to own Volkswagen Beatles but the war prevented this. Many owned other cars. All medium to big farmers owned tractors and trucks or shared such. Autobahns started to be made by manual labour to offset huge unemployment in the early 30's. Only a few month to an year after, they used huge machines for everything.

Sources : documentaries, history of electrical and electronic equipment, personal experience with old, German era equipment or equivalent ( similar design made in other countries ). There are people in Europe who may still own these. Some of them may use them as a secondary or for other purposes. I used an old German era original German radio Olympia for a guitar amplifier. On occasion, I listened to the radio amazed by the old tube technology. The bass was perfect.

I did not own an old style fridge. They were all replaced by new. I have spoken to many people in the 70's who had fridges, laundry machines and radios in the 30's and 40's. This was how they kept their food. And cooked on electrical stoves. However, most of them used charcoal and wood heaters to heat their apartments. Even people in the poor German related countries had all of these.

Only the Germans had TV sets, though and a TV station. The Brits did not have a real TV, they had an electromechanical one ( two types ) invented by a Scott. There are documentaries for these in the inventions which changed the world type of documentaries and the Brits are happy to bolster of this invention. However, the Germans invented the REAL TV and were the only people in the world to have sets and a program. The Americans did not have any TV, not even an electromechanical one then.

So, sources : I have personally seen most of these things.

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Re: Salaries in the Nazi Germany

Post by StevenStanleyBayes » 22 Apr 2017 09:09

Forgot :

For Free means the beneficiary does not pay directly. Who pays and how is another question. Thus, most things such as Health Care, Education, Unemployment Payments were FOR FREE.

Some people thing people pay through taxes for the things which they get for free. This, however, is not always true and not in full. Even when true, taxes do not mean payments. Payment is money given for goods and services. And this is not always true and, definitely not true for Germany in the 30's. So, the question who pays is answered simply : Germany pays. Who pays to Germany? Germany has many sources. One of them is sells of weapons. Another : sells of goods.

In the National Socialism, Germany owned Germany and not private companies. In theoretical communism and socialism, the people of a given country own everything in this country, in other words, theoretically, in Eastern Germany, East Germans owned everything and they can sell whatever they wanted to whomever they wanted. In practice, communism and socialism are not the reason for any deviation of these rules, the idiots who abused the theoretical communism and socialism are. These idiots were transitional and were to be out in the future, however, the people's short sightedness did not realise this and decided to replace the system instead of replacing the idiots. Examples of non idiots are Gorbachev, Lenin, Stalin ( in military and in defending the revolution from white contra's ) and, to some extend Dupcek. Most of the others were either complete idiots or idiots to an extend. Of course, these were the first and during the transitional periods and were to be replaced.

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Re: Salaries in the Nazi Germany

Post by StevenStanleyBayes » 23 Apr 2017 05:55

Most Important on Who Pays :

When Hitler came to power, the most urgent topic was stabilisation of finances. The inflation was so huge and rapid, people needed bigger baskets to carry the money to the shop than the baskets needed to carry the products, usually, a loaf of bread. There were two reasons for this : 1. Lack of goods ( gold is a good too ) to cover the money. 2. Non convertible Mark. 3. UNSTABLE Black market where people tried to dump the Marks for convertible currency.

Hitler realised financial is not more important than production but financial stability was necessary to start not yet centralised production. Thus Hitler ( most likely Goering ) did : 1. Introduce a Reich's Mark which was more stable than any other currency, initially bound to the US dollar at a rate of 2.50RM for $1US. In case of devaluation of the US dollar towards any other currency, the rate was to be recalculated, most likely. 2. Use SA, Gestapo and SS to destroy the black market physically. Anyone who sold currencies was to be jailed. 3. Back the Reich's Mark with goods so no one wants to exchange. 4. Fix the prices. No one was allowed to sell for more than the fixed prices. 5. Fix the salaries. No one was allowed to pay at a lower rate than the fixed one.

Economy and society are nothing but engineering. Thus, I would try to explain this again in engineering terms.

Hitler put a diode on the prices. They were allowed to go one direction only : towards zero. Hitler put a diode on the salaries too. They were allowed to go one direction only : towards infinity. Hitler eliminated the black market in the financial chain. Hitler was unable to establish convertibility of the Reich's Marks because this depended on other countries who deliberately disallowed this and this was one of the reasons for the war. Thus, there were only two things to do with the Reich's Marks : spend them in Germany or save them.

In order to ensure automatic stability ( not enforced by SA, Gestapo and SS ), Hitler introduced a huge production for the people. There were tons of goods. More and better than the US and British ones and any other in the world. The currency was not backed by Gold and other artificial for the economy methods but by real goods. This way, no one wanted to exchange Reich's Marks for any other currency in the world because there was nothing to do with US dollars, British Pounds and French Francs : nothing to purchase. On the contrary : there was everything and much more to purchase with Reich's Marks and better quality. This way, Hitler replaced the destructive positive feedback of no goods and unstable money with the stabilisation negative feedback of money, goods, stable money.

However, the biggest advantage of the controlled finance system was the unlimited amount of Reich's Marks. All Hitler needed to do is print money and pay for energy ( labour energy or machine energy ) wherever Hitler wanted to do whatever. Inflation and devaluation was impossible because of the explained diodes which did not conduct in inflation direction.

This gave Hitler an unlimited possibility. The management of the economy was no longer financial based as in capitalism and cannot be changed by monetary speculations. The management of the economy was energy based : Hitler had so much potential energy of human labour and so much potential energy of resources. Hitler needed to convert the potential energies into kinetic ones. And Hitler did. What for?

The most important goods were goods directly for the people. These were possessions. ( Good John Lennon was not a politician or economist. ) The secondary thing was goods indirectly for the people. These were goods which were used to make goods for the people, for example, electricity, autobahns, heavy machinery and industry, charcoal, resource exploration, etcetera. This is how German people had huge amounts of possessions, much more than in the US. People all over the world used a very important and general measurement parameter to measure standards in different countries : How many electric motors and tubes did the average citizen posses. the more, the better the standard as the possessions made with these components directly made people not work at home but the machines did so as well as provided communications amongst people and information.

This is the major difference between National Socialism and Practical Socialism. National Socialism was industries for goods for people first, than for the infrastructure while Practical Socialism was industry for the sake of the industry first and then for the people. Stalin saw this mistake Lenin did and oriented the industry for the people in 1939, 1940 and 1941 because Soviet people dangerously leaned towards National Socialism which was much better for the people then. Thus, had Hitler attacked the Soviet Union before 1939, many of the Soviet people were to follow Hitler and not Stalin. Stalin realised this and realised a war with Hitler would be automatically lost and made miracles to convert the economy from goods for the country to goods directly for people. This was why the Soviet Union outperformed Germany in people's standard in 1941 as well as the US and the whole world. However, this opulence brought another problem for Stalin but very tiny as compared with the previous problem : the Soviets became relaxed, lazy, cheerful, life loving people : the worst scenario for a soldier. They quickly changed back to misery after the attack on the summer solstice when Hitler attacked. And misery made them fight to avoid this and even bigger misery.

Indeed, the Ukrainian nationalists supported Hitler as they, although a minority, wanted their own country. However, after the Germans robbed them to misery, they switched back to the Soviet Union, the majority of them did.

So, back to the question : who pays for healthcare, education, etcetera. The answer is simple : Hitler did. ( Which means the German government did, but, back then, Hitler was Germany and Germany was Hitler as Rudolf Hess said. ) Hitler had unlimited amount of money which were more valuable and stable then Gold. Hitler decided to whom and for what to pay and what was the fair amount. And Hitler judged very well.

Except : Hitler wasted a lot of energy into bureaucracy : unnecessarily huge SS, Gestapo, ministries, civil workers, military hardware, paid military personnel ( sergeants, officers, generals ), etcetera. And Hitler did not want a war. Not until 1941 when Hitler used the war for politics. This was the biggest external mistake of Hitler. Then. The biggest internal mistake was the Jewish question.

So, yes. There are things which are for free. Hitler ( Germany ) pays for them.

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Re: The state of the economy in Nazi Germany

Post by GregSingh » 23 Apr 2017 07:15

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Christian Ankerstjerne
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Re: The state of the economy in Nazi Germany

Post by Christian Ankerstjerne » 23 Apr 2017 17:51

There is nothing impressive about a country that is only able to sustain its economy through the exploitation of slave labor and other countries' natural resources, as well as extreme levels of looting, through military force. If Germany hadn't used its military and totalitarian power to expand its domain and impose tight controls over both the raw material and financial systems, its economy would have collapsed due to its massively expansive financial policies.

Highlighting specific consumer products as evidence of Germany's industrial superiority is by definition cherry picking. It should be expected that any major, industrialized country would contribute to the technological development.

Using exports as an explanation of how Germany provided social services to its citizens assumes that it was Germany as a state that owned the factories. This isn't true; the German factories were privately owned. German arms exports were also quite limited. The real source of Germany's financial excesses was the Reichbank's printing press.

As for your claims about Hitler bringing Germany's inflation under control, this is simply not true. The hyperinflation of the Weimar Republic had been brought under control by 1925, long before NSDAP were even close to having a significant political influence.

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Re: The state of the economy in Nazi Germany

Post by Guaporense » 23 Apr 2017 22:28

Real per capita income in Germany circa 1937 was below most other developed countries. At around 85% the UK it was below the levels of Switzerland, Belgium, Denmark, Netherlands, US and Australia as well. It was more comparable to France's income or Sweden's and just better than Italy, Austria and Spain. Living standards in Germany were not above Western Europe's average in the late 30s.

Growth in Germany from 1913 to 1938 was very slow and below the long run trend from 1850 to 2015. The Nazis got popular because they got the economy in the middle of the great depression and just had to wait for it to take off from the slump. The massive economic growth from 1932 to 1943 was just convergence back to trend. Also a lot of growth from 1938 onwards was not per capita growth as the population of the Reich increased from 68 million in 1937 to 99 million by 1942 thanks to conquest and force immigration of labor. Per capita growth in the UK, Sweden, Norway, Switzerland Denmark and the US was better for the whole period 1913 to 1943.
"In tactics, as in strategy, superiority in numbers is the most common element of victory." - Carl von Clausewitz

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