tooze nazi intro
Preface
How was this possible? In 1938 the Third Reich embarked on Germany’s second campaign of conquest and destruction in less than a generation. At first, Hitler’s Wehrmacht seemed unstoppable, better prepared and more aggressive than the Kaiser’s armies. But as Hitler charged from victory to victory, his enemies multiplied. For the second time, a German bid to dominate the continent of Europe ran up against overwhelming opposition. By December 1941 the Third Reich was at war not only with the British Empire and the Soviet Union but with the United States as well. It took three years and five months, but in the end Hitler went down to a defeat far more cataclysmic than that which felled the Kaiser. Germany, along with large swathes of the rest of Eastern and Western Europe, was left in ruins. Poland and the western Soviet Union were practically eviscerated. France and Italy lurched perilously close to civil war. The overseas empires of Britain, France and the Netherlands were shaken beyond repair. And as the world learned of the extraordinary genocide committed by the National Socialist regime, the superiority once confidently claimed for European civilization was thrown for ever into question. How was this possible?
People make their own history. In the last instance, human will–both individual and collective–must be the starting point for any account of Nazi Germany. If we are to understand the awful deeds of the Third Reich we must seek to understand their perpetrators. We must treat Adolf Hitler and his followers seriously. We must seek to penetrate their mindset and to map the dark interstices of their ideology. It is not for nothing that biography–both individual and collective–is one of the most illuminating ways to study the Third Reich. But if it is true that ‘people make their own history’, it is also true, as Karl Marx put it, that ‘they do not make it just as they please; they do not make it under circumstances chosen by themselves, but under circumstances directly encountered, given and transmitted from the past’.1
What, then, are these circumstances? Somewhat surprisingly for those who think of him as a simplistic economic determinist, Marx followed up his famous aphorism, not with a disquisition on the mode of production, but with a paragraph about the way in which ‘the tradition of all the dead generations weighs like a nightmare on the brain of the living’. Historical actors, ‘just when they seem engaged in revolutionizing themselves and things, anxiously conjure up the spirits of the past . . . and borrow from them names, battle cries and costumes’ that allow the ‘new scene of world history’ to be dressed up in ‘time-honoured disguise’. Hitler and his cronies certainly inhabited such a self-fashioned world. And it is with good reason therefore that recent writing on the Third Reich has been preoccupied with politics and ideology. The cultural crises of early twentieth-century Europe, the vacuum left by the secularizing tendencies of the late nineteenth century, the radicalizing horror of World War I, all demand attention from anyone seriously interested in plumbing the deeper motives of National Socialism. How else can we understand a regime that took as its central objective the destruction of European Jewry, an objective apparently devoid of all economic rationale, a project that, if it can be understood at all, seems to be intelligible only in terms of a violent theology of redemptive purifica tion?2
The cultural and ideological turn in the study of Fascism has permanently remodelled our understanding of Hitler and his regime. It is hard to imagine now, but there was a time, not so long ago, when historians routinely dismissed Mein Kampf as a historical source and thought it reasonable to treat Hitler as just another opportunistic imperialist. Those days are gone. Thanks to the work of two generations of historians, we now have a far better understanding of the way in which Nazi ideology conditioned the thought and action of the Nazi leadership and wider German society. But whilst we have been busy unravelling the central ideological and political thread of Hitler’s regime, other crucial strands of the story have been relatively neglected. Most notably, historians have tended to downplay or even ignore the importance of the economy. In part, this has been a deliberate act of rejection. In part, the marginalization of economic history has been self-inflicted. The statistical terminology in which much economic history is couched is inaccessible to readers trained in the humanities, and too little effort has been made by either side to bridge the gap. Perhaps most of all, the turn against socio-economic analysis has been motivated by a sense of ennui, the impression that there is simply nothing new to say, that all the major questions were answered by the first two generations of historians and social scientists writing after 1945, who seized on such topics as the Nazi economic recovery or the history of the war economy.
What we are left with is a historiography moving at two speeds. Whereas our understanding of the regime’s racial policies and the inner workings of German society under National Socialism has been transformed over the last twenty years, the economic history of the regime has progressed very little. The aim of this book is to start a long overdue process of intellectual realignment. To do so, this book reassesses the archival and statistical evidence, much of which has gone unquestioned in sixty years, brings it into dialogue with the latest research, both by historians of the Third Reich and by economic historians exploring the dynamics of the inter-war economy, and asks what light this throws on some of the central questions in the history of Hitler’s regime. How did the fissures in the global power structure created by the great depression of 1929–32 enable Hitler’s government to have such a dramatic impact on the world scene? What was the relationship between the extraordinary imperial ambition of Hitler and his movement and the peculiar situation of the German economy and society in the 1920s and 1930s? How did domestic and international economic tensions contribute to Hitler’s drive to war in 1939 and his restless drive to widen the war thereafter? When and how did the Third Reich develop the Blitzkrieg strategy that is widely seen as the hallmark of its spectacular success in World War II? When the Blitzkrieg failed outside Moscow in December 1941, how did the Third Reich continue the war for almost three and half years against overwhelming material odds? And what are we to make of Albert Speer? In recent years this singular figure has attracted an extraordinary amount of attention, yet, and it is surely a sign of the times, what has been in the foreground has not been Speer’s primary function as Armaments Minister but questions relating to his role as Hitler’s architect, Speer’s personal knowledge of the Holocaust and his tortured efforts after 1945 to come to terms with the truth. This book is the first in sixty years to offer a truly critical account of the performance of the German war economy both under Speer and his predecessors and it casts stark new light on his role in sustaining the Third Reich to its bloody end. For it is only by re-examining the economic underpinnings of the Third Reich, by focusing on questions of land, food and labour that we can fully get to grips with the breathtaking process of cumulative radicalization that found its most extraordinary manifestation in the Holocaust.
The first aim of this book, therefore, is to reposition economics at the centre of our understanding of Hitler’s regime, by providing an economic narrative that helps to make sense of and underpin the political histories produced over the last generation. No less urgent, however, is the need to bring our understanding of the economic history of the Third Reich into line with the subtle but profound rewriting of the history of the European economy that has been ongoing since the late 1980s but has gone largely unnoticed in the mainstream historiography of Germany.
It is hardly an exaggeration to say that historians of twentieth-century Germany share at least one common starting point: the assumption of the peculiar strength of the German economy. Obviously, when Hitler took power Germany was in the midst of a deep economic crisis. But the common sense of twentieth-century European history is that Germany was an economic superpower in waiting, an economic force comparable only to that of the United States. For all the argument there has been over the backwardness or otherwise of German political culture, the assumption of Germany’s peculiar economic modernity has gone largely unquestioned. This assumption frames the writing of much of German social history, as much as it also informs accounts of German imperialism in the foreign policy field. Indeed, so influential has been the assumption of Germany’s economic superiority that it has influenced narratives, not only of German history, but those of other countries as well. For most of the twentieth century it was Germany with which Britain, France, Italy and even the United States were compared.
From the vantage point of the early twenty-first century, it is this assumption that we must start by challenging. Both the real-life experience of Europeans since the early 1990s and a generation of technical work by economists and economic historians has shaken, if not demolished, the myth of Germany’s peculiar economic superiority. The master-narrative of European economic history in the twentieth century, it turns out, was one of progressive convergence around a norm that was defined for most of the period, not by Germany, but by Britain, which in 1900 was already the world’s first fully industrial and urban society. Furthermore, Britain up to 1945 was no mere European country; it was the largest global empire the world had ever seen. In 1939, as the war started, the combined GDP of the British and French empires exceeded that of Germany and Italy by 60 per cent. Of course, the idea of inherent German economic superiority was not simply a figment of the historical imagination. Germany from the late nineteenth century onwards was the home for a cluster of world-beating industrial companies. Brand names like Krupp, Siemens and IG Farben gave substance to the myth of German industrial invincibility. Viewed in wider terms, however, the German economy differed little from the European average: its national per capita income in the 1930s was middling; in present-day terms it was comparable to that of Iran or South Africa. The standard of consumption enjoyed by the majority of the German population was modest and lagged behind that of most of its Western European neighbours. Germany under Hitler was still only a partially modernized society, in which upwards of 15 million people depended for their living either on traditional handicrafts or on peasant agriculture.
What strikes one today as the defining feature of twentieth-century economic history is not the peculiar dominance of Germany or any other European country, but the eclipse of the ‘old Continent’ by a sequence of new economic powers, above all the United States. In 1870, at the time of German national unification, the population of the United States and Germany was roughly equal and the total output of America, despite its enormous abundance of land and resources, was only one-third larger than that of Germany. Just before the outbreak of World War I the American economy had expanded to roughly twice the size of that of Imperial Germany. By 1943, before the aerial bombardment had hit top gear, total American output was almost four times that of the Third Reich.
We start the twenty-first century, therefore, with an altered historical perception from that which framed narratives of German history for most of the last hundred years. On the one hand we have a sharpened appreciation of the truly exceptional position of the United States within the modern global economy. On the other hand the common European experience of ‘convergence’ provides us with a distinctly disenchanted perspective on Germany’s economic history. The basic and possibly most radical contention of this book is that these interrelated shifts in our historical perception require a reframing of the history of the Third Reich, a reframing which has the disturbing effect both of rendering the history of Nazism more intelligible, indeed eerily contemporary, and at the same time bringing into even sharper relief its fundamental ideological irrationality. Economic history throws new light both on the motives for Hitler’s aggression and on the reasons why it failed, why indeed it was bound to fail.
In both respects, America should provide the pivot for our understanding of the Third Reich. In seeking to explain the urgency of Hitler’s aggression, historians have underestimated his acute awareness of the threat posed to Germany, along with the rest of the European powers, by the emergence of the United States as the dominant global superpower. On the basis of contemporary economic trends, Hitler predicted already in the 1920s that the European powers had only a few more years to organize themselves against this inevitability. Furthermore, Hitler understood the overwhelming attraction already exerted on Europeans by America’s affluent consumer lifestyle, an attraction whose force we can appreciate more vividly, given our sharpened awareness of the more generally transitional status of the European economies in the inter-war period. As in many semi-peripheral economies today, the German population in the 1930s was already thoroughly immersed in the commodity world of Hollywood, but at the same time many millions of people lived three or four to a room, without indoor bathrooms or access to electricity. Motor vehicles, radios and other accoutrements of modern living such as electrical household appliances were the aspiration of the social elite. The originality of National Socialism was that, rather than meekly accepting a place for Germany within a global economic order dominated by the affluent English-speaking countries, Hitler sought to mobilize the pent-up frustrations of his population to mount an epic challenge to this order. Repeating what Europeans had done across the globe over the previous three centuries, Germany would carve out its own imperial hinterland; by one last great land grab in the East it would create the self-sufficient basis both for domestic affluence and the platform necessary to prevail in the coming superpower competition with the United States.
The aggression of Hitler’s regime can thus be rationalized as an intelligible response to the tensions stirred up by the uneven development of global capitalism, tensions that are of course still with us today. But at the same time an understanding of the economic fundamentals also serves to sharpen our appreciation of the profound irrationality of Hitler’s project. As this book will show, Hitler’s regime after 1933 undertook a truly remarkable campaign of economic mobilization. The armaments programme of the Third Reich was the largest transfer of resources ever undertaken by a capitalist state in peacetime. Nevertheless, Hitler was powerless to alter the underlying balance of economic and military force. The German economy was simply not strong enough to create the military force necessary to overwhelm all its European neighbours, including both Britain and the Soviet Union, let alone the United States. Though Hitler scored brilliant short-term successes in 1936 and 1938, the diplomacy of the Third Reich failed to bring about the anti-Soviet alliance proposed in Mein Kampf. Faced with a war against Britain and France, Hitler was forced at the last moment to resort to an opportunistic arrangement with Stalin. The devastating effectiveness of the Panzer forces, the deus ex machina of the early years of the war, certainly did not form the basis for strategy in advance of the summer of 1940, since it came as a surprise even to the German leadership. And though the victories of the German army in 1940 and 1941 were undoubtedly spectacular they were inconclusive. We are thus left with the truly vertiginous conclusion that Hitler went to war in September 1939 without any coherent plan as to how actually to defeat the British Empire, his major antagonist.
Why did Hitler take this epic gamble? This surely is the fundamental question. Even if the conquest of living space can be rationalized as an act of imperialism, even if the Third Reich can be credited with a remarkable effort to muster its resources for combat, even if Germany’s soldiers fought brilliantly, Hitler’s conduct of the war involved risks so great that they defy rationalization in terms of pragmatic self-interest.3 And it is with this question that we reconnect to mainstream historiography and its insistence on the importance of ideology. It was ideology which provided Hitler with the lens through which he understood the international balance of power and the unfolding of the increasingly globalized struggle that began in Europe with the Spanish Civil War in the summer of 1936. In Hitler’s mind, the threat posed to the Third Reich by the United States was not just that of conventional superpower rivalry. The threat was existential and bound up with Hitler’s abiding fear of the world Jewish conspiracy, manifested in the shape of ‘Wall Street Jewry’ and the ‘Jewish media’ of the United States. It was this fantastical interpretation of the real balance of power that gave Hitler’s decision-making its volatile, risk-taking quality. Germany could not simply settle down to become an affluent satellite of the United States, as had seemed to be the destiny of the Weimar Republic in the 1920s, because this would result in enslavement to the world Jewish conspiracy, and ultimately race death. Given the pervasive influence of the Jews, as revealed by the mounting international tension of the late 1930s, a prosperous future of capitalist partnership with the Western powers was simply impossible. War was inevitable. The question was not if, but when.
This is a long book and, since it is written to be read from beginning to end, I don’t want to deflate the tension by revealing the decisive punch lines in the first few pages. Suffice to say that, though the broad outline of the history of the Third Reich has been deeply engraved in decades of painstaking investigative labour, the story as it is told here is new. My goal is to provide the reader with a deeper and broader understanding of how Hitler established himself in power and mobilized his society for war. I provide a new account of the dynamic that launched Germany into war and explain both how this sustained a successful war effort up to 1941 and how it reached its inevitable limit in the Russian snow. Next, the book takes on what is surely still the fundamental interpretative challenge facing any historian of the Third Reich, and perhaps particularly an economic historian: explaining the Holocaust. Drawing both on archival material and a generation of brilliant historical research, I emphasize the connections between the war against the Jews and the regime’s wider projects of imperialism, forced labour and deliberate starvation. In the minds of the Nazi leadership, there were, in fact, not one but a number of different economic rationales for genocide. Finally, building on these decisive chapters on 1939–42, I explain the extraordinary coercive effort through which the regime sustained Germany’s war effort for three bitter years, at the heart of which stood Albert Speer.
Those who at this point are already impatient for more specific conclusions should turn to Chapter 20, which provides a brief summary of at least some of the key points.
20
The End
The jaws of defeat finally closed on the Third Reich in the last week of April 1945. Just before midday on 25 April advanced patrols of the US 1st Army’s 69th infantry division and the Soviet 1st Ukrainian Army linked up on the banks of the Elbe at the small Saxon town of Strehla amidst the gruesome wreckage of a German refugee trek. The banks of the river, where Lieutenant Albert Kotzebue’s GIs embraced their Soviet counterparts, were littered with the dismembered corpses of dozens of old men, women and children. Three days earlier they had fallen victim to retreating Wehrmacht soldiers, who had been so desperate to escape capture by the Red Army that they had blown up the makeshift pontoon bridge whilst hundreds of civilians were still streaming across it. As many as four hundred may have drowned or been blown to pieces by the twin detonations.
Not surprisingly, the official occasion for the world-defining Soviet–American encounter was shifted 45 kilometres downstream to the town of Torgau, where contact was made later the same afternoon. The official photograph on Torgau’s broken-backed bridge was staged the following day. Contrived though it may have been, the handshake was highly significant. Along the course of the Elbe, Torgau lay midway between the burned-out baroque splendour of Dresden and the cradle of Lutheran Europe at Wittenberg. A few miles further to the north was Dessau, home not only to the Junkers bomber factories but also to the seminal early twentieth-century modernism of the Bauhaus. In Germany there was no more symbolic terrain on which to enact the epochal shift in the global balance of power from old Europe to the new powers of the United States and the Soviet Union.
From an economic point of view, Torgau was the logical outcome of two truly dramatic developments that defined the early twentieth century. The first and most obvious was the emergence of the United States as the dominant force in the world economy. The second, which did not become apparent until the 1930s, was the astonishing transformation of the Russian Empire wrought by the Bolshevik dictatorship. As the linking up of American and Soviet infantrymen deep in the heart of Central Europe confirmed, the history of the Continent in the first half of the twentieth century, the history of Germany and the history of Hitler’s regime cannot be understood but in relation to these twin developments in the United States and the Soviet Union. Certainly, this is the backdrop against which this particular account of the rise and fall of the Nazi economy has been set.
Hitler never ceased to hark back to the revolutions that swept Europe in 1917–18. Anti-Communism was an unwavering element in his politics, tightly interwoven with a particularly toxic form of conspiratorial anti-Semitism. But anti-Communism was generic on the German right, as were projects of Eastern expansionism. Furthermore, though the Soviet Union remained a looming presence in European affairs, it turned inwards from the late 1920s onwards and in the 1930s tended to be belittled as a factor in European power politics. To identify the peculiarity and motivating dynamic of Hitler’s regime, it therefore seemed more illuminating in the early chapters of this book to focus on the relations between the Third Reich and the Western powers.
The rise of the United States confronted Germany, as it did Britain and France, with a choice. With Stresemann as Foreign Minister, the Weimar Republic responded with remarkable flexibility and realism to the new situation. As we have shown, the Weimar Republic premised its entire security strategy on the economic power of the United States, both as a guarantor of its security and as a lever through which to pressure Britain and France into revision of the Treaty of Versailles. And as we have seen, this strategic choice continued to define the policy of the last respectable government of the Weimar Republic up to the summer of 1932. Not until the final spasm of the Great Depression in 1932–3 and the collapse of American hegemony in Europe was the path really open for Hitler’s brand of aggressively unilateralist nationalism.
In one of his final conversations with Martin Bormann, in February 1945, Hitler remarked: ‘An unfortunate historical accident fated it that my seizure of power should coincide with the moment at which the chosen one of world Jewry, Roosevelt, should have taken the helm in the White House . . . Everything is ruined by the Jew, who has settled upon the United States as his most powerful bastion.’1 What weighed on Hitler’s mind, in the last months of the war, was the pivotal role played by Roosevelt in frustrating his project of Continental conquest. In 1933, however, the role of the United States was the reverse. As Hitler came to power and Roosevelt took office, the American economy was racked by a last, devastating banking crisis. Washington’s decision to unfasten the dollar from gold, taken without regard to its international ramifications, destroyed what little chance there was of assembling a combined international front to contain Hitler’s regime before it had consolidated its grip on Germany. The coincidence of Hitler’s seizure of power with America’s temporary retreat from global affairs–a retreat that left Europe orphaned as it had not been since World WarI–was of incalculable importance.
Though he disagreed profoundly with Stresemann’s strategy in relation to the United States, Hitler was by no means oblivious to the changed world of the 1920s. In his ‘Second Book’, written in 1928, Hitler posed the central strategic questions with startling clarity: how was Germany, as a European state, to react to the ‘threatened global hegemony of North America’? How could it forestall America’s seemingly inevitable economic and military dominance? How was Germany’s political leadership to respond to the material aspirations awakened in its population by the example of American affluence? These are undeniably modern questions. Indeed, they are with us still. Hitler’s answers, however, were explosive. The solution was not to ally Germany with the United States, or to adopt American modes of life and production. Any such attempt at ‘Americanization’ was bound to end in frustration and disaster. Behind America, after all, stood the malevolent force of world Jewry, cloaked in the garb of liberalism, capitalism and democracy. The only adequate response to the American challenge was to create a Lebensraum for the German people sufficient to match that provided by the continent of the United States. Space on this scale was only available in the East and it could be attained only through conquest. There seems no reason to doubt that this mission of conquest was the sustaining ambition of Hitler’s regime. For Hitler, a war of conquest was not one policy option amongst others. Either the German race struggled for Lebensraum or its racial enemies would condemn it to extinction.
Mounting such a challenge required a diplomatic strategy and a major military effort, both of which were ultimately founded on economics. The enormous effort of national mobilization must be the central focus of any account of the economic history of Hitler’s regime. By comparison with the military-industrial complex, the various civilian work creation measures set in motion between June and December 1933, the domestic social policy initiatives and abortive projects of mass-consumption that followed, were nothing more than interim measures, which could attain their real significance only after a successful campaign of conquest. In any case, it would be a mistake to assume that the remilitarization of German society was something imposed from the top down, with the majority of Germans preferring butter to guns. For many millions, the reconstruction of the Wehrmacht was clearly the most successful aspect of the regime’s domestic policy and the collective mass-consumption of weaponry was a more than sufficient substitute for private affluence. As should be evident from the first half of this book, rearmament was the overriding and determining force impelling economic policy from the earliest stage. Everything else was sacrificed to it. In the six years between January 1933 and the autumn of the Munich crisis, Hitler’s regime raised the share of national output going to the military from less than 1 to almost 20 per cent. Never before had national production been redistributed on this scale or with such speed by a capitalist state in peacetime. This extraordinary effort at redistribution was certainly eased by the simultaneous growth in German output. Putting to work 6 million unemployed provided for the needs of the Wehrmacht, whilst allowing consumption and civilian investment to be increased as well. But it is easy to forget, given its wealth today, that Germany in the 1930s was a generation away from affluence and that the majority of the population subsisted on a very modest standard of living. Rearmament came at a serious cost and this was made even more pressing by the often crippling constraints imposed by Germany’s balance of payments. Already in 1934 the interests of both consumer goods industries and farmers were being sacrificed to rearmament. From 1935 in many German cities, butter and meat were surreptitiously rationed. From 1938 onwards, with military spending reaching wartime levels, the trade-off between consumption and armaments became truly severe. That Hitler’s regime was able to impose this redistribution of resources betokens not inefficiency and disorganization, but a system that was highly effective in pursuit of its central objectives. Furthermore, it should lead us to question any interpretation of Hitler’s regime based on the assumption that it lacked solid internal foundations. To reiterate, the Third Reich shifted more resources in peacetime into military uses than any other capitalist regime in history. And this advantage in terms of domestic resource mobilization continued to hold throughout the ensuing world war.
So far-reaching were the regime’s interventions in the German economy –starting with exchange controls and ending with the rationing of all key raw materials and the forced conscription of civilian workers in peacetime–that one is tempted to make comparisons with Stalin’s Soviet Union. Such a comparison is certainly suggestive in pointing to the kind of synthesis between militarization and domestic social and economic restructuring that might have been necessary to fulfil Hitler’s ambitions. Since the emergence of the United States as a world power in the early twentieth century, only Soviet-style militarism has been able to mount a credible and sustained challenge to its hegemony. And judged against Stalin’s regime, one might indeed describe Hitler’s state as a ‘weak dictatorship’. As we have seen, this was the conclusion reached by well-informed observers such as General Franz Halder in the autumn of Barbarossa’s failure in 1941. Most notably, in comparison with the Soviet Union, the Third Reich shrank from a dramatic rationalization of the most backward sectors of its society, peasant agriculture and the craft sector, a measure which might have ‘freed’ millions of additional workers. But given what we now know about the Generalplan Ost and the comprehensive agrarian restructuring that it was supposed to initiate, it seems that this was a matter of timing. The comprehensive restructuring of German society was simply postponed until after the conquest of Lebensraum in the East. If one must therefore concede that the Nazi party, unlike the cadres of Soviet Communism, was not a battle-hardened weapon of class war, by Western European standards it can hardly be faulted for its lack of redistributional energy. Never before, in peacetime, had a sophisticated capitalist economy been redirected so purposefully.
Setting aside the Stalinist counterfactual, one might equally well ask the opposite question. How was the Third Reich able to push its control over the German economy as far as it did? Why did Germany’s business lobby tolerate this dramatic intrusion of state power after 1933? Only a decade earlier, ‘big business’ had after all played an important part in frustrating the reforming ambitions of the early Weimar Republic. The answer given here consists basically of four elements. First and foremost, one must emphasize the damage done to the independent power of the business lobby by the Great Depression. Even if they had been predisposed to do so, Germany’s big businessmen were in no position to put up a serious fight in 1933. Secondly, though the Nazi autarchic turn was certainly at odds with the international agenda of the German business lobby, the domestic authoritarianism of Hitler’s coalition was much to their liking, as were the healthy profits that rolled in from the mid-1930s. Thirdly, though there clearly was a dramatic assertion of state power over business after 1933, naked coercion was applied only selectively and in many spheres the regime was only too willing to harness the independent initiative of businessmen, managers and technicians. Finally, given the highly uneven structure of ownership and organization in the German economy and the lack of unity between competing capitalist interests, a series of well-chosen tactical alliances were all that was needed to push vital parts of industry and commerce in the direction desired by the regime.
Once we bear in mind the constraints under which it operated it is, therefore, hard to escape the conclusion that the Third Reich was an extremely effective mobilizing regime. Furthermore, it is clear that this mobilization was from the outset directed towards the resurrection of Germany as a military power and in some general sense towards the achievement of Hitler’s goals of conquest. But if one asks whether this economic mobilization was part of a coherent strategic synthesis, if one asks whether diplomacy, military planning and economic mobilization were united after 1933 in a coherent war plan, the answer delivered by this book is negative. In this respect we still struggle to unpick the effect of hindsight. We know, after all, that up to the frustration of Barbarossa in the autumn of 1941, Hitler’s armies carried all before them. It seems hard to imagine that this remarkable military preponderance was not the result of long-term preparation. But the vertiginous conclusion suggested by recent military history is that this was indeed the case. Germany started the war in September 1939 with no substantial material or technical superiority over the better-established military powers of the West. It was only the fatal interlocking of Allied and German operational planning that led to the defeat of France in a few short weeks in May and June 1940. And it was this in turn that unleashed the Wehrmacht for its rampage through Southern and Eastern Europe in 1941, which was finally and predictably brought to a halt by the enormous expanse of the Soviet Union and the dogged though ill-directed resistance of the Red Army. The central chapters of this book are devoted to unlocking the puzzles that are implied by these compelling findings of battlefield historians. If the huge rearmament drive of the 1930s and the annexation of Austria and Czechoslovakia were not enough to give Germany a substantial material advantage over its enemies, if their immediate effect was to drive Britain and France into abandoning their pacificism in favour of an aggressive strategy of containment and to force both Washington and Moscow to reconsider their positions in Europe, why did Hitler go to war in September 1939?
Faced with this question, some historians choose to argue that Hitler simply miscalculated. He did not intend to precipitate a general European war, they insist. After his experience at Munich in 1938 he expected Britain and France to stand aside in Eastern Europe. It was not Hitler, but the Western powers who chose to turn Poland into a casus belli. That argumentative option is rejected here since it does not accord with the diplomatic evidence of the last days leading up to the war. In August 1939, as in September 1938, Hitler was confronted with the near certainty that Britain and France would declare war. On the former occasion he had pulled back. In 1939 he chose not to. Why he plunged forward rather than pulling back is explained in this book through a novel synthesis of three distinct elements.
The first point to emphasize is that Hitler knew by the summer of 1939 that his effort to develop a long-term programme of preparation for a war with the Western powers had failed. This, indeed, is one of the key findings of this book. Though, in 1938, Hitler’s regime did attempt to respond to the growing resistance of the Western powers by embarking on a gigantic programme for ‘full spectrum’ rearmament and though Hitler and Ribbentrop did attempt to create a global alliance with the reach to match the emerging Western coalition, this attempt was frustrated. By the summer of 1939, German efforts to unite Italy and Japan into a triple threat against the British had manifestly failed. Furthermore, as this book shows for the first time in full detail, the German armaments economy in the summer of 1939 was being seriously squeezed by the persistent problems of the balance of payments. This is not to say that the Third Reich was facing an economic crisis. The combination of controls put in place in the course of the 1930s was undeniably effective in preventing the recurrence of a general crisis of the kind that had come close to destabilizing Hitler’s regime in 1934. But in 1939 the precarious situation of the German balance of payments permitted no further acceleration of the armaments effort. Since Britain, France, the United States and the Soviet Union were all accelerating their rearmament at precisely this moment, Hitler found himself facing a sharp deterioration in the balance of forces at a date far earlier than he had expected.
Adding to the pressure for immediate action was the dramatic shift in the global diplomatic constellation. Through his breakneck aggression in 1938 and early 1939 Hitler had dismantled the French security cordon in Central Europe that had hinged on Czechoslovakia. However, after the occupation of Prague in the spring of 1939 the diplomatic fronts were hardened by the British and French guarantees to Poland and Romania. Everything now depended on the behaviour of the two flanking powers, the United States and the Soviet Union. In the summer of 1939 Stalin’s decision to opt for a strategy based on fomenting inter-capitalist war tilted the balance in favour of Germany. The Nazi–Soviet pact guaranteed Germany against a second front in the East, and protected it against the worst effects of the much feared Anglo-French blockade. One can therefore construct a compelling economic-strategic rationale for Hitler’s decision to go to war in September 1939. Given Germany’s deteriorating economic position and the unexpectedly favourable shift in the diplomatic balance, Hitler had nothing further to gain by waiting. And as we have seen, Hitler spelled out this logic in virtually these words to anyone who would listen after September 1939.
But to confine ourselves to these rational elements of strategy would be to miss the crucial third ingredient in Hitler’s decision-making process. To argue in terms of a strategic window of opportunity begs the question of why Hitler believed that war with the Western powers was inevitable. Why did he feel compelled to seize the opportunity, to gamble the future of his entire regime on a war with Britain and France, at a moment when Germany enjoyed, at most, only a slender military advantage? To explain this decision we must invoke ideology. This might seem paradoxical in light of the fact that Hitler was departing so flagrantly from the programme outlined in Mein Kampf. In that book, dictated in a prison cell in Landsberg fifteen years earlier, Hitler had called for an Anglo-German alliance against the Judaeo-Bolshevik threat. In 1939 he went to war with fronts reversed: in alliance with Stalin against Britain. This, however, is simplistic. The key to Hitler’s ideology was not a particular diplomatic schema, but his obsessive fixation on racial struggle and in particular the antagonism between Aryans and Jews. In the Four Year Plan memorandum of 1936, the emphasis had still been on the Judaeo-Bolshevik conspiracy. Two years later, as foreign policy and armaments policy were directed ever more clearly against the West, there is a striking parallel in the shifting focus of the regime’s anti-Semitic rhetoric. From 1938 onwards, in Hitler’s public utterances, the Jewish question in its wider sense was emphatically a Western and above all an American question. As was shown in Chapters 8 and 9, from the Évian conference onwards and with ever greater intensity after Kristallnacht, President Roosevelt was identified as the chief agent of a worldwide Jewish conspiracy bent on the destruction of National Socialist Germany. It was no coincidence that Hitler’s famous threat of annihilation of 30 January 1939 came as a direct response to Roosevelt’s State of the Union address. The United States, as everyone understood, was the key to deciding the balance of the arms race. If Britain and France could count firmly on American aid, their position would be well nigh unassailable. But the position of the United States was precariously balanced. Whilst Roosevelt led the rhetorical assault against Hitler and encouraged Britain, France and Poland in their resistance to Nazi expansionism, isolationist currents in the United States were still strong. Hitler and the rest of the Nazi leadership could not help but interpret this complex situation through the dark haze of Manichaean anti-Semitism. For them, it was obvious that it was Jewish elements in Washington, London and Paris, bent implacably on the destruction of Nazi Germany, that were tightening the international encirclement. And it was this paranoid sense of menace that precipitated Hitler’s decision to launch his strike against Poland and then against the Western coalition that continued to stand obstinately in his way.
It is perhaps not surprising that this factor was not emphasized in the speeches that Hitler made to the military leadership between May and August 1939–certainly not in the notes taken by the military men who attended. But after the fact Hitler made no secret of its importance. Most emphatically in their conversations with the Italian leadership in the spring of 1940, both Hitler and Ribbentrop stressed the role of world Jewry in forcing the pace of events in 1939. And what is more, this peculiar combination of strategic and economic factors, overarched by Hitler’s abiding anti-Semitic obsession, is capable not only of accounting for Hitler’s decision to go to war. It can also make sense of his subsequent willingness to escalate the conflict to an ever larger scale. The decision to risk a general European war over Poland, the decision in the summer of 1940, after having defeated France but not having defeated Britain, to begin immediate preparations for an attack on the Soviet Union and finally in November–December 1941 the decision to support Japan in its aggression against the United States, all followed the same pattern. Faced with the coalition of enemies that had first shown itself in 1938, orchestrated, as Hitler believed, by the ‘chosen one of world Jewry’, he knew that time was not on his side. The combined economic might of the Western powers, added after June 1941 to that of the Soviet Union, was overwhelming. If he was ever to secure the Lebensraum that Germany needed for true strategic freedom, Hitler needed to strike hard and fast.
In relation to the early years of World War II, there are four points of novelty to emphasize as conclusions of this book.
The anti-Western turn in Nazi anti-Semitism, which we have identified as an important theme of 1938–9, continued unabated throughout 1940 and 1941. Having precipitated the war by backing Britain and France in their guarantee for Poland, Roosevelt was now prolonging the war by backing Churchill in his refusal to surrender, a constellation which in Berlin could be explained only by reference to the malevolent role of Jews in both Washington and London. This in turn implies that as far as motivation is concerned any hard and fast distinction between the wars in the West and the East must be softened if not abandoned altogether. Though in their modes of execution the wars were drastically different, to think of them as motivated in fundamentally different ways is mistaken. The war in the West against Churchill and Roosevelt was no less an ideological war than the war for Lebensraum in the East. And though the primary motivation for invading the Soviet Union in 1941, as opposed to a later date, was to force the pace of events in the West, by driving Britain into submission before America could intervene, this too must be seen as part of the larger war against world Jewry. To counterpose this ‘strategic rationale’ to Hitler’s long-held ideological vision of a war of conquest in the East is to pose a false alternative. Since 1938 Hitler had seen himself as locked in a global confrontation with world Jewry. Linking the campaign in the East to the war in the West, therefore, in no way diminishes its ideological content.
Having cleared aside that possible source of misunderstanding, the second point to make is that there was a compelling economic case for Hitler’s decision to widen the war in 1941. The astonishing defeat of France in the early summer of 1940 had promised to change everything. But in fact the Wehrmacht’s spectacular victory did not resolve Hitler’s fundamental strategic dilemma. The German navy and air force were too weak to force Britain to the negotiating table. The competitive logic of the arms race continued to apply in 1940 and 1941. Rather than surrender to Hitler’s will, Britain proved willing to go to the point of national bankruptcy before being rescued by lend-lease. And thanks to its comparatively abundant foreign reserves and American assistance it could mobilize a far larger percentage of foreign resources than Germany at this critical point in the war. In Berlin, by contrast, once the euphoria of victory had worn off, a considerable disillusionment set in over the economic viability of Germany’s new Grossraum. Conquering most of Western Europe added a drastic shortage of oil, nagging difficulties in coal supply and a serious shortage of animal feed to Germany’s already severe deficiencies. The populations of Western Europe were a vital asset, as was their industrial capacity, but, given the constraints imposed by the British blockade, it was far from clear that these resources could be effectively mobilized. Unless Germany could secure access to the grain surpluses and oil of the Soviet Union, and organize a sustained increase in coal production, continental Europe was threatened with a prolonged decline in output, productivity and living standards. Added to which, Roosevelt had launched his own spectacular rearmament programme within days of Germany’s breakthrough at Sedan. The strategic pressure on Hitler to pre-empt decisive American intervention in the war can only really be appreciated if we do full justice to the scale of the Anglo-American effort from as early as the summer of 1940. In this respect, the truly vast discrepancy between Anglo-American aircraft procurement and Germany’s relatively insignificant outsourcing to France and the Netherlands is very telling. It was an imbalance that was not lost on Goering and the German Air Ministry.
Giving due weight to the trans-Atlantic arms race in German calculations in 1940–41 also helps us to explain another conundrum which has continued to preoccupy students of the Nazi regime and which seriously influences the way in which we write its history. Contrary to the claims of some authors, the Ostheer of 1941 was considerably more powerful than that which invaded France. But it is equally undeniable that it was a force carefully calibrated on the assumption that the Red Army could be destroyed in a short campaign. German planning provided for no margin of error. Even on a charitable reading, therefore, the Barbarossa campaign was surrounded by enormous risks. It appears irrational and foolhardy when this evidence of minimal mobilization is combined with the most widely cited industrial statistics, which appear to show stagnation in armaments output and a catastrophic collapse in labour productivity between 1940 and 1941. In the light of this data, it would seem that complacency and inefficiency following the victory over France, combined with racist condescension towards the Soviets, prevented the Wehrmacht from maximizing its chances in what was clearly the decisive campaign of the war. If this were true, this moment of ‘failure’ should clearly stand at the centre of our entire interpretation of Hitler’s regime. However, once we consider the wider strategic situation and combine this with critical scrutiny of the economic evidence, a very different picture emerges. The idea that armaments production in Germany lagged in 1940–41 and that there was a dramatic collapse in productivity is in large part a statistical illusion. Furthermore, a narrow focus on armaments production ignores what was one of the most distinctive features of the early German war effort, a huge wave of investment that continued almost uninterruptedly between 1939 and 1942. When we give this its due weight, we realize something crucial. Thanks to America’s backing for Britain, Germany continued to be locked into the logic of the trans-Atlantic arms race, even whilst it was girding itself for Barbarossa. Germany’s industrial resources could never be fully concentrated on the Soviet Union, because at the same time enormous preparations needed to be set in train for the coming air war with Britain and America. It was after the stupendous German military victories in France, therefore, that Hitler adopted what can justifiably be described as a Blitzkrieg strategy, a coordinated strategy in which both armament production and strategic planning were premised on the assumption of swift and decisive battlefield victory over the Red Army. Its purpose, however, was not to cushion the civilian population. Its purpose was to allow Germany to fight two wars at once.
One might in fact say that the Third Reich in the spring of 1941 was preparing itself not for two wars, but for three wars: one against the Red Army, one against the British and Americans and a third against the civilian population of Eastern Europe, beginning with the Jews. And here too ‘pragmatic economic’ motives and genocidal ideology were inseparably intertwined. On the one hand the SS programmes of genocidal population clearance, to begin with the Jews, were embedded in the Generalplan Ost in an extraordinary vision of agricultural and industrial colonization. Conversely, in the Hunger Plan agreed by the Ministries in the spring of 1941 the most straightforward pragmatic calculation of the food supply was combined with assumptions of racial hierarchy to produce a plan for mass murder, which dwarfed even the Wannsee programme.
This global Blitzkrieg, this grand strategy of racial war, turned out, however, to be a strategy not of victory but of defeat. Already at Smolensk in July–August 1941 Barbarossa ran aground. Meanwhile America was ever more firmly committed to providing aid both to Britain and the Soviet Union. Faced with the ever greater certainty of having to fight a two- or even three-front war, the extraordinary strategic synthesis that the Third Reich had concocted over the previous twelve months fell apart. By December Hitler, true to his conspiratorial logic, had declared war on the United States in alliance with the Japanese. Convinced that open war with the United States was, in any case, only a matter of months away, he seized on the strategic diversion provided by the Japanese offensive in the Pacific. It was to his verbal exchanges of January 1939 with Roosevelt that Hitler repeatedly returned in the autumn of 1941 as he was mulling over both the ultimate shape of the Final Solution and the possibility of a strategic escape from the two-front war in which the Third Reich now found itself.
By any reasonable estimation, Hitler’s declaration of war on the United States sealed the fate of Germany. The economic and military forces arrayed against the Third Reich by early 1942 were overwhelming. As we have shown, this fatalistic view was shared by all those most closely involved with the management of the German war effort up to the Moscow crisis. Udet of the Luftwaffe, Fromm of the army, Thomas of the Wehrmacht high command, Todt in the Armaments Ministry, Canaris in intelligence, Rohland and his colleagues in the Ruhr, all came to the same conclusion. All these men had thrown in their lot with Hitler’s regime. But they were not ignorant of the basic trends of early twentieth-century history. They were as convinced as the vast majority of their contemporaries of the pivotal importance of the United States economy. None of them doubted that once American industrial capacity was mobilized–and they were fully aware of the measures that had already been taken in 1940 and 1941–Germany’s situation would be worse than that of 1918. To have thought anything else would have been to fly in the face of contemporary common sense, well reflected in the anxieties of the general public that were faithfully recorded by Gestapo informants. The full extent of America’s production triumphs after 1942 came as a surprise even to the Americans. But the basic script had already been written in 1917–18 and in the endless retelling of the Fordist narrative throughout the 1920s and 1930s. And the fact was, of course, that the pessimism of the leading German experts did not even give full weight to the extraordinary industrial and military staying power of the Soviet Union that in fact turned out to be the Wehrmacht’s main problem in 1942 and 1943.
This pessimism, however, should throw stark light on the group of individuals who took charge of the German war effort in the aftermath of the Moscow crisis. There has never been any argument about the motivations of men such as Herbert Backe, the orchestrator of the Hunger Plan, or Gauleiter Fritz Sauckel with his pan-European press-gangs. Nor should there be any further argument about Albert Speer. These men were not unpolitical agents of technocratic efficiency. They were the Hitler loyalists willing to do their bit for the Third Reich to the bitter end. They were the men on whom Hitler could rely even in the last months of the war. And they would literally stop at nothing to continue the fight. Speer’s ‘armaments miracle’ relied on resources mobilized by every facet of the Nazi state. The Reichsbank, the Ministry of Economic Affairs and the Finance Ministry played an important but largely unacknowledged role in preserving the stability of the German currency, at least until the beginning of 1944. German industry rallied all its energies in a desperate effort to prevail against the Soviet Union. But these seemingly innocuous components of the German war effort were multiply interconnected with the sinister nexus of political power organized around the questions of labour and food by Gauleiter Sauckel, State Secretary Herbert Backe, Hermann Goering and Heinrich Himmler. Through their combined efforts, in 1942 millions of extra workers were mobilized for German industry and the food balance of Europe was drastically redistributed so as to secure the calories and protein necessary to fuel Albert Speer’s armaments miracle. As we showed in Chapter 16, in the summer of 1942 even the wholesale gassing of the Jews of Poland was made to serve a functional purpose in this radicalized form of Total War. And from the summer of 1943 onwards Speer came to rely ever more heavily on a coercive partnership with Heinrich Himmler and the SS.
The emphasis on rationalization in the management of the German war effort that emerged from the crisis of 1941 was certainly new. And after Speer’s appointment German armaments output did increase. However, to treat this as the apolitical expression of Speer’s technocratic abilities is to miss the point. The entire purpose of the ‘armaments miracle’ was political. Loudly trumpeted by the new line in ‘armaments propaganda’, it served to answer the fundamental doubt that increasingly beset the German war effort. The essential message of the rationalization campaign was that Germany’s obvious material inferiority need not be fatal. With the proper application of will-power and energetic youthful improvisation, more could be produced for less. And, as the Wehrmacht had so often demonstrated, there was no limit to what German soldiers could achieve, provided only that they had the necessary weapons.
The point is not of course to dismiss entirely the increase in armaments production achieved by Speer and Milch. It was real enough. But no less real was its strategic failure. The essence of Hitler’s gamble in December 1941 was timing. After the declaration of war on the United States the need to achieve a decisive success against the Red Army was more pressing than ever. In this crucial respect Speer’s Armaments Ministry failed. In 1942, in the first full flush of the ‘armaments miracle’, Germany was considerably outproduced by the extraordinary mobilization of the Soviet economy. This Soviet effort was unsustainable. By 1944 Germany had caught up with and overtaken the Soviet Union. But as both the Soviets and the Germans knew, the summer, autumn and winter battles of 1942–3 were the key to deciding the war on the Eastern Front. And in this crucial period it was the Soviet factories that prevailed. This window of opportunity was so important because during most of 1942 Britain and America’s offensive operations against the Third Reich were marginal in their impact. As of the autumn of 1942 this was no longer the case. The weight of British and American material made itself felt first in North Africa and the Mediterranean, then in the defeat of the German U-boats and, as of the spring of 1943, in sustained aerial bombardment. Combined with the elimination of Mussolini in July 1943, the opening of a significant ‘second front’ had a truly dramatic effect. For six months in 1943 the disruption caused by British and American bombing halted Speer’s armaments miracle in its tracks. The German home front was rocked by a serious crisis of morale. By July 1943 the war was obviously lost.
The final, famous acceleration of German armaments production in 1944, on which the reputation of Speer’s Armaments Ministry largely rests, took place amidst a maelstrom of apocalyptic violence that consumed the lives of millions of people and laid waste to a large part of the Continent. First in the Mittelbau and then in the brutal practices of the Jaegerstab, the murderous violence of the SS police state was imported directly into the war economy. Tens of thousands of out-of-date fighters were squeezed out of Germany’s factories in the first half of 1944 by mobilizing all available labour and materials, applying virtually limitless powers of repression and exploiting every possibility for economies of scale. In the summer of 1944, Speer and the Jaegerstab maintained a telephone hotline to the ramp at Auschwitz, where SS guards were processing the Jews of Hungary, the last great population to be fed to the gas chambers. It was in the dank, deathly gloom of Hans Kammler’s underground factories that the Third Reich made its final futile bid to match the Americans in mass-production.
Hitler had prophesied that if Germany did not prevail against its enemies, it would face a national catastrophe unlike anything in modern history. From 1942 onwards he and his collaborators, Albert Speer chief amongst them, steered Germany directly towards this outcome. Even now, the damage inflicted by Hitler’s regime and by his futile war is almost unbearable to contemplate. Decades after the event, the memory of the harm done–to the population of Europe, to the physical fabric of daily life, to the very idea of European civilization–is still enough to inspire feelings of despair, rage and resentment, and not only on the part of Germany’s victims. Here is not the place to attempt a review of this horror. But since economic historians have ways of making disasters, such as that which Germany brought down upon itself in 1945, disappear from the long-run trajectory of economic growth, it is worth lingering a little on this scene.
The destruction and human misery in Germany in 1945 is barely describable in its scale.2 As the Third Reich collapsed, quite apart from the millionfold murder that Germany had committed across Europe, more than one-third of the boys born to German families between 1915 and 1924 were either dead or missing. Amongst those born between 1920 and 1925 losses amounted to 40 per cent. The rest of the German population was subject to uprooting and displacement on a truly epic scale. Whilst the 11 million Wehrmacht men who had survived the war in uniform were herded into makeshift prisoner of war camps administered by the occupying forces, a similar number of 9–10 million non-German displaced persons enjoyed an unwonted degree of freedom, whilst they waited to be repatriated to their homes in Eastern and Western Europe. At the same time 9 million German evacuees streamed back towards their devastated cities. Meanwhile, to the east there was an extraordinary human avalanche, as 14.16 million ethnic Germans were driven systematically out of their homes in Eastern and Central Europe by the embittered Slav population. Of this spectacular exodus at least 1.71 million would die en route. The country to which they ‘returned’ presented a scene of devastation and poverty that defies description. Large parts of Germany had been reduced to ‘a rubble-strewn wasteland in which the living often envied the dead’.3 At least 3.8 million out of a stock of 19 million apartments had been destroyed. In the cities hit hardest by the bombing, losses in housing stock ran to 50 per cent.4 Huddled in overcrowded and half-ruined apartments, the German population, which until the autumn of 1944 had been reasonably well fed, now starved and froze.
Unlike the Germans during their reign over Europe, the Allies did what was necessary to keep the German population alive. But they did so with reservations. As General Lucius D. Clay, Eisenhower’s deputy, put it in June 1945: ‘Conditions are going to be extremely difficult in Germany this winter and there will be much cold and hunger. Some cold and hunger will be necessary to make the German people realize the consequences of a war which they caused.’5 Nevertheless, Clay also insisted that ‘this type of suffering should not extend to the point where it results in mass starvation and sickness’.6 Joint Chiefs of Staffs Directive 1067, the basic instructions issued to the occupying forces in 1945, specified that food should be provided to Germany sufficient only to prevent ‘disease and unrest’. Until 1948, however, the food supply in all four zones of occupation fell well short of what was required. As a direct result of decisions taken by Speer and the Zentrale Planung in 1943 and 1944, the nitrogen fertilizer needed by German farms had been directed instead to the production of explosives and ammunition. Yields were drastically down. To make matters worse, Germany’s richest grain surplus area east of the Oder–Neisse was awarded to the Poles at the Potsdam agreement. Supplies were brought in from across the Atlantic, but by the early summer of 1946 rations in many parts of urban Germany were below 1,000 calories per day. Despite the flourishing black market, the evidence of serious malnutrition was unmistakable. Mortality increased as did the incidence of hunger-related diseases. Infection rates for diphtheria, typhoid and tuberculosis in the British and American zones doubled. The birth weight of babies fell drastically. Even the most intrepid statisticians hesitate to plumb the depths to which Germany had fallen by the end of 1945. Money had long since ceased to function in any ordinary sense of the word. One estimate for 1946 puts German per capita GDP at just over $2,200, a figure not seen since the 1880s, one-tenth the level that Germans enjoy today. And this certainly exaggerates the actual level of economic activity in the second half of 1945. Coal production, the lifeline of modern urban society, was down by 80 per cent, and the coal that was available could not be distributed, given the ruination of the railway system.
Nor should we underestimate the intensity of hatred felt towards Germany by its neighbours and former enemies. If it is true that Germans after 1945 were forced to swallow at least some of their sense of vic-timhood, it is no less true that Germany’s former enemies thought it better to forget the sense of rage that clearly motivated much of Allied policy in the immediate aftermath of the war. In 1945 along the Dutch-German border, American GIs passed signs that read: ‘Here Ends the Civilized World’.7 It is one of the most persistent myths in post-war history that the Allies learned the lesson from World War I not to extract reparations from Germany. In fact, both halves of Germany paid substantially higher reparations after 1945 than the Weimar Republic ever did. Not surprisingly, the Soviets were most determined in their pursuit of compensation. What was to become the German Democratic Republic suffered the dismantling of at least 30 per cent of its industrial capital stock and paid occupation costs and reparations to the Soviet Union which even in 1953 still totalled almost 13 per cent of its national income.8 The Federal Republic for its part was more leniently treated. But it too made payments between 1953 and 1992 totalling in excess of 90 billion Deutschmarks. And it was not merely physical capital that was dismantled. In the Soviet zone, tens of thousands of suspect members of the Nazi party were rounded up for interrogation and summary trials. Many thousands were executed. The Western powers, not surprisingly, adopted more legalistic procedures. Roughly 200,000 Nazi suspects were arrested and detained in internment camps, including many leaders of German big business. Of 5,153 individuals accused of major war crimes, 668 were condemned to death by military tribunals. In addition, in the first burst of enthusiasm, the Western Allies dismissed almost half the civil servants in their zones and required millions to register for denazification. Though this process ultimately degenerated into a cynical farce, in its early stages it was perceived by the German population as a threatening intervention in the structure of social life. Viewed in conjunction with the high-profile trials at Nuremberg, it was one more sign of Germany’s pariah status.
The initial post-war period thus went a long way towards confirming Hitler’s apocalyptic view of politics. Germany had ceased to exist as a political entity, as a military force or an economic unit. The terrible irony, however, is that in the years that followed it was not Hitler’s logic but Stresemann’s that prevailed. In 1919, with his eye on the Bolshevik threat in the East, Stresemann had predicted that the time would soon come when Germany would again be needed. After World War II, with the Red Army in Vienna and Berlin, it took barely two years for the same insight to impose itself in Washington and London. To stave off collapse and a surge in support for the Communist party, reconstruction began already over the winter of 1946–7. In the 1920s Stresemann had gambled that the German economy was so integral to the wider economy of Europe that it would be in the interest of none of the victor powers to see it permanently crippled. In 1947 American Secretary of State General George Marshall made his famous offer of aid to Europe dependent on the inclusion of Germany. At first this was hard for France to swallow. France’s national programme of economic reconstruction after 1945 was premised on the assumption that it would be France not Germany that controlled the resources of the Ruhr. But within three years of Marshall’s announcement, it was the French, as they had done in 1929, who came forward with proposals for European integration based this time around a European Coal and Steel Community and a European Defence Community. To complete the bitter irony, Konrad Adenauer, who as the Chancellor of the Federal Republic between 1949 and 1963 was to steer West Germany towards its position at the heart both of the European Community and NATO, was in fact two years older than Gustav Stresemann, who had been only 51 at the time of his death in 1929.9
A functioning parliamentary system, an alliance with America and closer European economic integration were all goals to which Stresemann clearly aspired. But in the 1920s Weimar politics had still been animated and ultimately destabilized by the idea that Germany would one day re-emerge as a great power in the classic eighteenth- and nineteenth-century sense. What precisely this meant was already questionable in the aftermath of World War I and its demonstration of the futility of war as a means of great power politics. But ‘freedom of action’ in international relations was clearly still constitutive of full sovereignty, for Stresemann as much as for most other Europeans. After the horror of Nazism and World War II, democratization, the Western alliance and closer European integration were all back to the fore. The apocalyptic temptation of militarism was largely exorcized from Europe. Its dying embers flared up only occasionally in the rearguard actions of empire. But with it also went any aspiration to the ‘freedom’ once implied by great power status. As early as the autumn of 1943, after the Battle of Kursk, the United States had realized that the dominant power in Europe for the foreseeable future would be the Soviet Union, not Britain, let alone France. At first Roosevelt’s administration hoped to adjust to this new reality in cooperation with the Soviets. Together the two superpowers would rule both Europe and the world, under which circumstances it might have been possible to ‘do without Germany’. But by 1947 that option was clearly off the table. First West Germany and then East Germany were resurrected as independent states. Their subsequent economic recovery along with that of the rest of Europe was one of the true miracles of the twentieth century. The success in creating a democratic polity in West Germany was also remarkable. So free, in fact, did West Germany seem of the tensions that had plagued the Weimar Republic, that some were even tempted to suppose that the curative fire of National Socialism had been necessary to drive out the German demons. What this ignores, however, is that German democracy after 1945 was not as anyone had imagined it in the 1920s. It existed within a strange and truncated form of statehood and much the same might be said for most, if not all, of the former ‘great powers’ of Europe. Through the middle of Germany’s territory ran the new battle lines of the Cold War. Huge forces of occupation were massed on either side, non-European forces–American on one side, Soviet on the other. The threat of nuclear annihilation hung over everyone. And though West Germany certainly had a functioning democracy, the scope of political debate was also incomparably more restricted than it had been in the 1920s. The most explosive issues of Weimar politics–the question of territorial integrity and the question of military parity–were removed, it seemed, for ever from the political agenda. The economic miracle was the abiding preoccupation of the West German Republic, as it was for the rest of Europe. The drama of twenty-five years of unprecedented economic growth moved ‘politics’, in the classic sense, to the sidelines. Even the remarkable project of European integration resolved itself into an endless process of bartering over milk quotas and national rebates. The catastrophe of the Third Reich had not brought about the extinction of Germany, but what it had done was to draw the curtain on the classic era of European politics. Sixty years later, what else there might be to politics in Europe beyond the tiresome squabbles of discontented affluence remains an open question.
How was this possible? In 1938 the Third Reich embarked on Germany’s second campaign of conquest and destruction in less than a generation. At first, Hitler’s Wehrmacht seemed unstoppable, better prepared and more aggressive than the Kaiser’s armies. But as Hitler charged from victory to victory, his enemies multiplied. For the second time, a German bid to dominate the continent of Europe ran up against overwhelming opposition. By December 1941 the Third Reich was at war not only with the British Empire and the Soviet Union but with the United States as well. It took three years and five months, but in the end Hitler went down to a defeat far more cataclysmic than that which felled the Kaiser. Germany, along with large swathes of the rest of Eastern and Western Europe, was left in ruins. Poland and the western Soviet Union were practically eviscerated. France and Italy lurched perilously close to civil war. The overseas empires of Britain, France and the Netherlands were shaken beyond repair. And as the world learned of the extraordinary genocide committed by the National Socialist regime, the superiority once confidently claimed for European civilization was thrown for ever into question. How was this possible?
People make their own history. In the last instance, human will–both individual and collective–must be the starting point for any account of Nazi Germany. If we are to understand the awful deeds of the Third Reich we must seek to understand their perpetrators. We must treat Adolf Hitler and his followers seriously. We must seek to penetrate their mindset and to map the dark interstices of their ideology. It is not for nothing that biography–both individual and collective–is one of the most illuminating ways to study the Third Reich. But if it is true that ‘people make their own history’, it is also true, as Karl Marx put it, that ‘they do not make it just as they please; they do not make it under circumstances chosen by themselves, but under circumstances directly encountered, given and transmitted from the past’.1
What, then, are these circumstances? Somewhat surprisingly for those who think of him as a simplistic economic determinist, Marx followed up his famous aphorism, not with a disquisition on the mode of production, but with a paragraph about the way in which ‘the tradition of all the dead generations weighs like a nightmare on the brain of the living’. Historical actors, ‘just when they seem engaged in revolutionizing themselves and things, anxiously conjure up the spirits of the past . . . and borrow from them names, battle cries and costumes’ that allow the ‘new scene of world history’ to be dressed up in ‘time-honoured disguise’. Hitler and his cronies certainly inhabited such a self-fashioned world. And it is with good reason therefore that recent writing on the Third Reich has been preoccupied with politics and ideology. The cultural crises of early twentieth-century Europe, the vacuum left by the secularizing tendencies of the late nineteenth century, the radicalizing horror of World War I, all demand attention from anyone seriously interested in plumbing the deeper motives of National Socialism. How else can we understand a regime that took as its central objective the destruction of European Jewry, an objective apparently devoid of all economic rationale, a project that, if it can be understood at all, seems to be intelligible only in terms of a violent theology of redemptive purifica tion?2
The cultural and ideological turn in the study of Fascism has permanently remodelled our understanding of Hitler and his regime. It is hard to imagine now, but there was a time, not so long ago, when historians routinely dismissed Mein Kampf as a historical source and thought it reasonable to treat Hitler as just another opportunistic imperialist. Those days are gone. Thanks to the work of two generations of historians, we now have a far better understanding of the way in which Nazi ideology conditioned the thought and action of the Nazi leadership and wider German society. But whilst we have been busy unravelling the central ideological and political thread of Hitler’s regime, other crucial strands of the story have been relatively neglected. Most notably, historians have tended to downplay or even ignore the importance of the economy. In part, this has been a deliberate act of rejection. In part, the marginalization of economic history has been self-inflicted. The statistical terminology in which much economic history is couched is inaccessible to readers trained in the humanities, and too little effort has been made by either side to bridge the gap. Perhaps most of all, the turn against socio-economic analysis has been motivated by a sense of ennui, the impression that there is simply nothing new to say, that all the major questions were answered by the first two generations of historians and social scientists writing after 1945, who seized on such topics as the Nazi economic recovery or the history of the war economy.
What we are left with is a historiography moving at two speeds. Whereas our understanding of the regime’s racial policies and the inner workings of German society under National Socialism has been transformed over the last twenty years, the economic history of the regime has progressed very little. The aim of this book is to start a long overdue process of intellectual realignment. To do so, this book reassesses the archival and statistical evidence, much of which has gone unquestioned in sixty years, brings it into dialogue with the latest research, both by historians of the Third Reich and by economic historians exploring the dynamics of the inter-war economy, and asks what light this throws on some of the central questions in the history of Hitler’s regime. How did the fissures in the global power structure created by the great depression of 1929–32 enable Hitler’s government to have such a dramatic impact on the world scene? What was the relationship between the extraordinary imperial ambition of Hitler and his movement and the peculiar situation of the German economy and society in the 1920s and 1930s? How did domestic and international economic tensions contribute to Hitler’s drive to war in 1939 and his restless drive to widen the war thereafter? When and how did the Third Reich develop the Blitzkrieg strategy that is widely seen as the hallmark of its spectacular success in World War II? When the Blitzkrieg failed outside Moscow in December 1941, how did the Third Reich continue the war for almost three and half years against overwhelming material odds? And what are we to make of Albert Speer? In recent years this singular figure has attracted an extraordinary amount of attention, yet, and it is surely a sign of the times, what has been in the foreground has not been Speer’s primary function as Armaments Minister but questions relating to his role as Hitler’s architect, Speer’s personal knowledge of the Holocaust and his tortured efforts after 1945 to come to terms with the truth. This book is the first in sixty years to offer a truly critical account of the performance of the German war economy both under Speer and his predecessors and it casts stark new light on his role in sustaining the Third Reich to its bloody end. For it is only by re-examining the economic underpinnings of the Third Reich, by focusing on questions of land, food and labour that we can fully get to grips with the breathtaking process of cumulative radicalization that found its most extraordinary manifestation in the Holocaust.
The first aim of this book, therefore, is to reposition economics at the centre of our understanding of Hitler’s regime, by providing an economic narrative that helps to make sense of and underpin the political histories produced over the last generation. No less urgent, however, is the need to bring our understanding of the economic history of the Third Reich into line with the subtle but profound rewriting of the history of the European economy that has been ongoing since the late 1980s but has gone largely unnoticed in the mainstream historiography of Germany.
It is hardly an exaggeration to say that historians of twentieth-century Germany share at least one common starting point: the assumption of the peculiar strength of the German economy. Obviously, when Hitler took power Germany was in the midst of a deep economic crisis. But the common sense of twentieth-century European history is that Germany was an economic superpower in waiting, an economic force comparable only to that of the United States. For all the argument there has been over the backwardness or otherwise of German political culture, the assumption of Germany’s peculiar economic modernity has gone largely unquestioned. This assumption frames the writing of much of German social history, as much as it also informs accounts of German imperialism in the foreign policy field. Indeed, so influential has been the assumption of Germany’s economic superiority that it has influenced narratives, not only of German history, but those of other countries as well. For most of the twentieth century it was Germany with which Britain, France, Italy and even the United States were compared.
From the vantage point of the early twenty-first century, it is this assumption that we must start by challenging. Both the real-life experience of Europeans since the early 1990s and a generation of technical work by economists and economic historians has shaken, if not demolished, the myth of Germany’s peculiar economic superiority. The master-narrative of European economic history in the twentieth century, it turns out, was one of progressive convergence around a norm that was defined for most of the period, not by Germany, but by Britain, which in 1900 was already the world’s first fully industrial and urban society. Furthermore, Britain up to 1945 was no mere European country; it was the largest global empire the world had ever seen. In 1939, as the war started, the combined GDP of the British and French empires exceeded that of Germany and Italy by 60 per cent. Of course, the idea of inherent German economic superiority was not simply a figment of the historical imagination. Germany from the late nineteenth century onwards was the home for a cluster of world-beating industrial companies. Brand names like Krupp, Siemens and IG Farben gave substance to the myth of German industrial invincibility. Viewed in wider terms, however, the German economy differed little from the European average: its national per capita income in the 1930s was middling; in present-day terms it was comparable to that of Iran or South Africa. The standard of consumption enjoyed by the majority of the German population was modest and lagged behind that of most of its Western European neighbours. Germany under Hitler was still only a partially modernized society, in which upwards of 15 million people depended for their living either on traditional handicrafts or on peasant agriculture.
What strikes one today as the defining feature of twentieth-century economic history is not the peculiar dominance of Germany or any other European country, but the eclipse of the ‘old Continent’ by a sequence of new economic powers, above all the United States. In 1870, at the time of German national unification, the population of the United States and Germany was roughly equal and the total output of America, despite its enormous abundance of land and resources, was only one-third larger than that of Germany. Just before the outbreak of World War I the American economy had expanded to roughly twice the size of that of Imperial Germany. By 1943, before the aerial bombardment had hit top gear, total American output was almost four times that of the Third Reich.
We start the twenty-first century, therefore, with an altered historical perception from that which framed narratives of German history for most of the last hundred years. On the one hand we have a sharpened appreciation of the truly exceptional position of the United States within the modern global economy. On the other hand the common European experience of ‘convergence’ provides us with a distinctly disenchanted perspective on Germany’s economic history. The basic and possibly most radical contention of this book is that these interrelated shifts in our historical perception require a reframing of the history of the Third Reich, a reframing which has the disturbing effect both of rendering the history of Nazism more intelligible, indeed eerily contemporary, and at the same time bringing into even sharper relief its fundamental ideological irrationality. Economic history throws new light both on the motives for Hitler’s aggression and on the reasons why it failed, why indeed it was bound to fail.
In both respects, America should provide the pivot for our understanding of the Third Reich. In seeking to explain the urgency of Hitler’s aggression, historians have underestimated his acute awareness of the threat posed to Germany, along with the rest of the European powers, by the emergence of the United States as the dominant global superpower. On the basis of contemporary economic trends, Hitler predicted already in the 1920s that the European powers had only a few more years to organize themselves against this inevitability. Furthermore, Hitler understood the overwhelming attraction already exerted on Europeans by America’s affluent consumer lifestyle, an attraction whose force we can appreciate more vividly, given our sharpened awareness of the more generally transitional status of the European economies in the inter-war period. As in many semi-peripheral economies today, the German population in the 1930s was already thoroughly immersed in the commodity world of Hollywood, but at the same time many millions of people lived three or four to a room, without indoor bathrooms or access to electricity. Motor vehicles, radios and other accoutrements of modern living such as electrical household appliances were the aspiration of the social elite. The originality of National Socialism was that, rather than meekly accepting a place for Germany within a global economic order dominated by the affluent English-speaking countries, Hitler sought to mobilize the pent-up frustrations of his population to mount an epic challenge to this order. Repeating what Europeans had done across the globe over the previous three centuries, Germany would carve out its own imperial hinterland; by one last great land grab in the East it would create the self-sufficient basis both for domestic affluence and the platform necessary to prevail in the coming superpower competition with the United States.
The aggression of Hitler’s regime can thus be rationalized as an intelligible response to the tensions stirred up by the uneven development of global capitalism, tensions that are of course still with us today. But at the same time an understanding of the economic fundamentals also serves to sharpen our appreciation of the profound irrationality of Hitler’s project. As this book will show, Hitler’s regime after 1933 undertook a truly remarkable campaign of economic mobilization. The armaments programme of the Third Reich was the largest transfer of resources ever undertaken by a capitalist state in peacetime. Nevertheless, Hitler was powerless to alter the underlying balance of economic and military force. The German economy was simply not strong enough to create the military force necessary to overwhelm all its European neighbours, including both Britain and the Soviet Union, let alone the United States. Though Hitler scored brilliant short-term successes in 1936 and 1938, the diplomacy of the Third Reich failed to bring about the anti-Soviet alliance proposed in Mein Kampf. Faced with a war against Britain and France, Hitler was forced at the last moment to resort to an opportunistic arrangement with Stalin. The devastating effectiveness of the Panzer forces, the deus ex machina of the early years of the war, certainly did not form the basis for strategy in advance of the summer of 1940, since it came as a surprise even to the German leadership. And though the victories of the German army in 1940 and 1941 were undoubtedly spectacular they were inconclusive. We are thus left with the truly vertiginous conclusion that Hitler went to war in September 1939 without any coherent plan as to how actually to defeat the British Empire, his major antagonist.
Why did Hitler take this epic gamble? This surely is the fundamental question. Even if the conquest of living space can be rationalized as an act of imperialism, even if the Third Reich can be credited with a remarkable effort to muster its resources for combat, even if Germany’s soldiers fought brilliantly, Hitler’s conduct of the war involved risks so great that they defy rationalization in terms of pragmatic self-interest.3 And it is with this question that we reconnect to mainstream historiography and its insistence on the importance of ideology. It was ideology which provided Hitler with the lens through which he understood the international balance of power and the unfolding of the increasingly globalized struggle that began in Europe with the Spanish Civil War in the summer of 1936. In Hitler’s mind, the threat posed to the Third Reich by the United States was not just that of conventional superpower rivalry. The threat was existential and bound up with Hitler’s abiding fear of the world Jewish conspiracy, manifested in the shape of ‘Wall Street Jewry’ and the ‘Jewish media’ of the United States. It was this fantastical interpretation of the real balance of power that gave Hitler’s decision-making its volatile, risk-taking quality. Germany could not simply settle down to become an affluent satellite of the United States, as had seemed to be the destiny of the Weimar Republic in the 1920s, because this would result in enslavement to the world Jewish conspiracy, and ultimately race death. Given the pervasive influence of the Jews, as revealed by the mounting international tension of the late 1930s, a prosperous future of capitalist partnership with the Western powers was simply impossible. War was inevitable. The question was not if, but when.
This is a long book and, since it is written to be read from beginning to end, I don’t want to deflate the tension by revealing the decisive punch lines in the first few pages. Suffice to say that, though the broad outline of the history of the Third Reich has been deeply engraved in decades of painstaking investigative labour, the story as it is told here is new. My goal is to provide the reader with a deeper and broader understanding of how Hitler established himself in power and mobilized his society for war. I provide a new account of the dynamic that launched Germany into war and explain both how this sustained a successful war effort up to 1941 and how it reached its inevitable limit in the Russian snow. Next, the book takes on what is surely still the fundamental interpretative challenge facing any historian of the Third Reich, and perhaps particularly an economic historian: explaining the Holocaust. Drawing both on archival material and a generation of brilliant historical research, I emphasize the connections between the war against the Jews and the regime’s wider projects of imperialism, forced labour and deliberate starvation. In the minds of the Nazi leadership, there were, in fact, not one but a number of different economic rationales for genocide. Finally, building on these decisive chapters on 1939–42, I explain the extraordinary coercive effort through which the regime sustained Germany’s war effort for three bitter years, at the heart of which stood Albert Speer.
Those who at this point are already impatient for more specific conclusions should turn to Chapter 20, which provides a brief summary of at least some of the key points.
20
The End
The jaws of defeat finally closed on the Third Reich in the last week of April 1945. Just before midday on 25 April advanced patrols of the US 1st Army’s 69th infantry division and the Soviet 1st Ukrainian Army linked up on the banks of the Elbe at the small Saxon town of Strehla amidst the gruesome wreckage of a German refugee trek. The banks of the river, where Lieutenant Albert Kotzebue’s GIs embraced their Soviet counterparts, were littered with the dismembered corpses of dozens of old men, women and children. Three days earlier they had fallen victim to retreating Wehrmacht soldiers, who had been so desperate to escape capture by the Red Army that they had blown up the makeshift pontoon bridge whilst hundreds of civilians were still streaming across it. As many as four hundred may have drowned or been blown to pieces by the twin detonations.
Not surprisingly, the official occasion for the world-defining Soviet–American encounter was shifted 45 kilometres downstream to the town of Torgau, where contact was made later the same afternoon. The official photograph on Torgau’s broken-backed bridge was staged the following day. Contrived though it may have been, the handshake was highly significant. Along the course of the Elbe, Torgau lay midway between the burned-out baroque splendour of Dresden and the cradle of Lutheran Europe at Wittenberg. A few miles further to the north was Dessau, home not only to the Junkers bomber factories but also to the seminal early twentieth-century modernism of the Bauhaus. In Germany there was no more symbolic terrain on which to enact the epochal shift in the global balance of power from old Europe to the new powers of the United States and the Soviet Union.
From an economic point of view, Torgau was the logical outcome of two truly dramatic developments that defined the early twentieth century. The first and most obvious was the emergence of the United States as the dominant force in the world economy. The second, which did not become apparent until the 1930s, was the astonishing transformation of the Russian Empire wrought by the Bolshevik dictatorship. As the linking up of American and Soviet infantrymen deep in the heart of Central Europe confirmed, the history of the Continent in the first half of the twentieth century, the history of Germany and the history of Hitler’s regime cannot be understood but in relation to these twin developments in the United States and the Soviet Union. Certainly, this is the backdrop against which this particular account of the rise and fall of the Nazi economy has been set.
Hitler never ceased to hark back to the revolutions that swept Europe in 1917–18. Anti-Communism was an unwavering element in his politics, tightly interwoven with a particularly toxic form of conspiratorial anti-Semitism. But anti-Communism was generic on the German right, as were projects of Eastern expansionism. Furthermore, though the Soviet Union remained a looming presence in European affairs, it turned inwards from the late 1920s onwards and in the 1930s tended to be belittled as a factor in European power politics. To identify the peculiarity and motivating dynamic of Hitler’s regime, it therefore seemed more illuminating in the early chapters of this book to focus on the relations between the Third Reich and the Western powers.
The rise of the United States confronted Germany, as it did Britain and France, with a choice. With Stresemann as Foreign Minister, the Weimar Republic responded with remarkable flexibility and realism to the new situation. As we have shown, the Weimar Republic premised its entire security strategy on the economic power of the United States, both as a guarantor of its security and as a lever through which to pressure Britain and France into revision of the Treaty of Versailles. And as we have seen, this strategic choice continued to define the policy of the last respectable government of the Weimar Republic up to the summer of 1932. Not until the final spasm of the Great Depression in 1932–3 and the collapse of American hegemony in Europe was the path really open for Hitler’s brand of aggressively unilateralist nationalism.
In one of his final conversations with Martin Bormann, in February 1945, Hitler remarked: ‘An unfortunate historical accident fated it that my seizure of power should coincide with the moment at which the chosen one of world Jewry, Roosevelt, should have taken the helm in the White House . . . Everything is ruined by the Jew, who has settled upon the United States as his most powerful bastion.’1 What weighed on Hitler’s mind, in the last months of the war, was the pivotal role played by Roosevelt in frustrating his project of Continental conquest. In 1933, however, the role of the United States was the reverse. As Hitler came to power and Roosevelt took office, the American economy was racked by a last, devastating banking crisis. Washington’s decision to unfasten the dollar from gold, taken without regard to its international ramifications, destroyed what little chance there was of assembling a combined international front to contain Hitler’s regime before it had consolidated its grip on Germany. The coincidence of Hitler’s seizure of power with America’s temporary retreat from global affairs–a retreat that left Europe orphaned as it had not been since World WarI–was of incalculable importance.
Though he disagreed profoundly with Stresemann’s strategy in relation to the United States, Hitler was by no means oblivious to the changed world of the 1920s. In his ‘Second Book’, written in 1928, Hitler posed the central strategic questions with startling clarity: how was Germany, as a European state, to react to the ‘threatened global hegemony of North America’? How could it forestall America’s seemingly inevitable economic and military dominance? How was Germany’s political leadership to respond to the material aspirations awakened in its population by the example of American affluence? These are undeniably modern questions. Indeed, they are with us still. Hitler’s answers, however, were explosive. The solution was not to ally Germany with the United States, or to adopt American modes of life and production. Any such attempt at ‘Americanization’ was bound to end in frustration and disaster. Behind America, after all, stood the malevolent force of world Jewry, cloaked in the garb of liberalism, capitalism and democracy. The only adequate response to the American challenge was to create a Lebensraum for the German people sufficient to match that provided by the continent of the United States. Space on this scale was only available in the East and it could be attained only through conquest. There seems no reason to doubt that this mission of conquest was the sustaining ambition of Hitler’s regime. For Hitler, a war of conquest was not one policy option amongst others. Either the German race struggled for Lebensraum or its racial enemies would condemn it to extinction.
Mounting such a challenge required a diplomatic strategy and a major military effort, both of which were ultimately founded on economics. The enormous effort of national mobilization must be the central focus of any account of the economic history of Hitler’s regime. By comparison with the military-industrial complex, the various civilian work creation measures set in motion between June and December 1933, the domestic social policy initiatives and abortive projects of mass-consumption that followed, were nothing more than interim measures, which could attain their real significance only after a successful campaign of conquest. In any case, it would be a mistake to assume that the remilitarization of German society was something imposed from the top down, with the majority of Germans preferring butter to guns. For many millions, the reconstruction of the Wehrmacht was clearly the most successful aspect of the regime’s domestic policy and the collective mass-consumption of weaponry was a more than sufficient substitute for private affluence. As should be evident from the first half of this book, rearmament was the overriding and determining force impelling economic policy from the earliest stage. Everything else was sacrificed to it. In the six years between January 1933 and the autumn of the Munich crisis, Hitler’s regime raised the share of national output going to the military from less than 1 to almost 20 per cent. Never before had national production been redistributed on this scale or with such speed by a capitalist state in peacetime. This extraordinary effort at redistribution was certainly eased by the simultaneous growth in German output. Putting to work 6 million unemployed provided for the needs of the Wehrmacht, whilst allowing consumption and civilian investment to be increased as well. But it is easy to forget, given its wealth today, that Germany in the 1930s was a generation away from affluence and that the majority of the population subsisted on a very modest standard of living. Rearmament came at a serious cost and this was made even more pressing by the often crippling constraints imposed by Germany’s balance of payments. Already in 1934 the interests of both consumer goods industries and farmers were being sacrificed to rearmament. From 1935 in many German cities, butter and meat were surreptitiously rationed. From 1938 onwards, with military spending reaching wartime levels, the trade-off between consumption and armaments became truly severe. That Hitler’s regime was able to impose this redistribution of resources betokens not inefficiency and disorganization, but a system that was highly effective in pursuit of its central objectives. Furthermore, it should lead us to question any interpretation of Hitler’s regime based on the assumption that it lacked solid internal foundations. To reiterate, the Third Reich shifted more resources in peacetime into military uses than any other capitalist regime in history. And this advantage in terms of domestic resource mobilization continued to hold throughout the ensuing world war.
So far-reaching were the regime’s interventions in the German economy –starting with exchange controls and ending with the rationing of all key raw materials and the forced conscription of civilian workers in peacetime–that one is tempted to make comparisons with Stalin’s Soviet Union. Such a comparison is certainly suggestive in pointing to the kind of synthesis between militarization and domestic social and economic restructuring that might have been necessary to fulfil Hitler’s ambitions. Since the emergence of the United States as a world power in the early twentieth century, only Soviet-style militarism has been able to mount a credible and sustained challenge to its hegemony. And judged against Stalin’s regime, one might indeed describe Hitler’s state as a ‘weak dictatorship’. As we have seen, this was the conclusion reached by well-informed observers such as General Franz Halder in the autumn of Barbarossa’s failure in 1941. Most notably, in comparison with the Soviet Union, the Third Reich shrank from a dramatic rationalization of the most backward sectors of its society, peasant agriculture and the craft sector, a measure which might have ‘freed’ millions of additional workers. But given what we now know about the Generalplan Ost and the comprehensive agrarian restructuring that it was supposed to initiate, it seems that this was a matter of timing. The comprehensive restructuring of German society was simply postponed until after the conquest of Lebensraum in the East. If one must therefore concede that the Nazi party, unlike the cadres of Soviet Communism, was not a battle-hardened weapon of class war, by Western European standards it can hardly be faulted for its lack of redistributional energy. Never before, in peacetime, had a sophisticated capitalist economy been redirected so purposefully.
Setting aside the Stalinist counterfactual, one might equally well ask the opposite question. How was the Third Reich able to push its control over the German economy as far as it did? Why did Germany’s business lobby tolerate this dramatic intrusion of state power after 1933? Only a decade earlier, ‘big business’ had after all played an important part in frustrating the reforming ambitions of the early Weimar Republic. The answer given here consists basically of four elements. First and foremost, one must emphasize the damage done to the independent power of the business lobby by the Great Depression. Even if they had been predisposed to do so, Germany’s big businessmen were in no position to put up a serious fight in 1933. Secondly, though the Nazi autarchic turn was certainly at odds with the international agenda of the German business lobby, the domestic authoritarianism of Hitler’s coalition was much to their liking, as were the healthy profits that rolled in from the mid-1930s. Thirdly, though there clearly was a dramatic assertion of state power over business after 1933, naked coercion was applied only selectively and in many spheres the regime was only too willing to harness the independent initiative of businessmen, managers and technicians. Finally, given the highly uneven structure of ownership and organization in the German economy and the lack of unity between competing capitalist interests, a series of well-chosen tactical alliances were all that was needed to push vital parts of industry and commerce in the direction desired by the regime.
Once we bear in mind the constraints under which it operated it is, therefore, hard to escape the conclusion that the Third Reich was an extremely effective mobilizing regime. Furthermore, it is clear that this mobilization was from the outset directed towards the resurrection of Germany as a military power and in some general sense towards the achievement of Hitler’s goals of conquest. But if one asks whether this economic mobilization was part of a coherent strategic synthesis, if one asks whether diplomacy, military planning and economic mobilization were united after 1933 in a coherent war plan, the answer delivered by this book is negative. In this respect we still struggle to unpick the effect of hindsight. We know, after all, that up to the frustration of Barbarossa in the autumn of 1941, Hitler’s armies carried all before them. It seems hard to imagine that this remarkable military preponderance was not the result of long-term preparation. But the vertiginous conclusion suggested by recent military history is that this was indeed the case. Germany started the war in September 1939 with no substantial material or technical superiority over the better-established military powers of the West. It was only the fatal interlocking of Allied and German operational planning that led to the defeat of France in a few short weeks in May and June 1940. And it was this in turn that unleashed the Wehrmacht for its rampage through Southern and Eastern Europe in 1941, which was finally and predictably brought to a halt by the enormous expanse of the Soviet Union and the dogged though ill-directed resistance of the Red Army. The central chapters of this book are devoted to unlocking the puzzles that are implied by these compelling findings of battlefield historians. If the huge rearmament drive of the 1930s and the annexation of Austria and Czechoslovakia were not enough to give Germany a substantial material advantage over its enemies, if their immediate effect was to drive Britain and France into abandoning their pacificism in favour of an aggressive strategy of containment and to force both Washington and Moscow to reconsider their positions in Europe, why did Hitler go to war in September 1939?
Faced with this question, some historians choose to argue that Hitler simply miscalculated. He did not intend to precipitate a general European war, they insist. After his experience at Munich in 1938 he expected Britain and France to stand aside in Eastern Europe. It was not Hitler, but the Western powers who chose to turn Poland into a casus belli. That argumentative option is rejected here since it does not accord with the diplomatic evidence of the last days leading up to the war. In August 1939, as in September 1938, Hitler was confronted with the near certainty that Britain and France would declare war. On the former occasion he had pulled back. In 1939 he chose not to. Why he plunged forward rather than pulling back is explained in this book through a novel synthesis of three distinct elements.
The first point to emphasize is that Hitler knew by the summer of 1939 that his effort to develop a long-term programme of preparation for a war with the Western powers had failed. This, indeed, is one of the key findings of this book. Though, in 1938, Hitler’s regime did attempt to respond to the growing resistance of the Western powers by embarking on a gigantic programme for ‘full spectrum’ rearmament and though Hitler and Ribbentrop did attempt to create a global alliance with the reach to match the emerging Western coalition, this attempt was frustrated. By the summer of 1939, German efforts to unite Italy and Japan into a triple threat against the British had manifestly failed. Furthermore, as this book shows for the first time in full detail, the German armaments economy in the summer of 1939 was being seriously squeezed by the persistent problems of the balance of payments. This is not to say that the Third Reich was facing an economic crisis. The combination of controls put in place in the course of the 1930s was undeniably effective in preventing the recurrence of a general crisis of the kind that had come close to destabilizing Hitler’s regime in 1934. But in 1939 the precarious situation of the German balance of payments permitted no further acceleration of the armaments effort. Since Britain, France, the United States and the Soviet Union were all accelerating their rearmament at precisely this moment, Hitler found himself facing a sharp deterioration in the balance of forces at a date far earlier than he had expected.
Adding to the pressure for immediate action was the dramatic shift in the global diplomatic constellation. Through his breakneck aggression in 1938 and early 1939 Hitler had dismantled the French security cordon in Central Europe that had hinged on Czechoslovakia. However, after the occupation of Prague in the spring of 1939 the diplomatic fronts were hardened by the British and French guarantees to Poland and Romania. Everything now depended on the behaviour of the two flanking powers, the United States and the Soviet Union. In the summer of 1939 Stalin’s decision to opt for a strategy based on fomenting inter-capitalist war tilted the balance in favour of Germany. The Nazi–Soviet pact guaranteed Germany against a second front in the East, and protected it against the worst effects of the much feared Anglo-French blockade. One can therefore construct a compelling economic-strategic rationale for Hitler’s decision to go to war in September 1939. Given Germany’s deteriorating economic position and the unexpectedly favourable shift in the diplomatic balance, Hitler had nothing further to gain by waiting. And as we have seen, Hitler spelled out this logic in virtually these words to anyone who would listen after September 1939.
But to confine ourselves to these rational elements of strategy would be to miss the crucial third ingredient in Hitler’s decision-making process. To argue in terms of a strategic window of opportunity begs the question of why Hitler believed that war with the Western powers was inevitable. Why did he feel compelled to seize the opportunity, to gamble the future of his entire regime on a war with Britain and France, at a moment when Germany enjoyed, at most, only a slender military advantage? To explain this decision we must invoke ideology. This might seem paradoxical in light of the fact that Hitler was departing so flagrantly from the programme outlined in Mein Kampf. In that book, dictated in a prison cell in Landsberg fifteen years earlier, Hitler had called for an Anglo-German alliance against the Judaeo-Bolshevik threat. In 1939 he went to war with fronts reversed: in alliance with Stalin against Britain. This, however, is simplistic. The key to Hitler’s ideology was not a particular diplomatic schema, but his obsessive fixation on racial struggle and in particular the antagonism between Aryans and Jews. In the Four Year Plan memorandum of 1936, the emphasis had still been on the Judaeo-Bolshevik conspiracy. Two years later, as foreign policy and armaments policy were directed ever more clearly against the West, there is a striking parallel in the shifting focus of the regime’s anti-Semitic rhetoric. From 1938 onwards, in Hitler’s public utterances, the Jewish question in its wider sense was emphatically a Western and above all an American question. As was shown in Chapters 8 and 9, from the Évian conference onwards and with ever greater intensity after Kristallnacht, President Roosevelt was identified as the chief agent of a worldwide Jewish conspiracy bent on the destruction of National Socialist Germany. It was no coincidence that Hitler’s famous threat of annihilation of 30 January 1939 came as a direct response to Roosevelt’s State of the Union address. The United States, as everyone understood, was the key to deciding the balance of the arms race. If Britain and France could count firmly on American aid, their position would be well nigh unassailable. But the position of the United States was precariously balanced. Whilst Roosevelt led the rhetorical assault against Hitler and encouraged Britain, France and Poland in their resistance to Nazi expansionism, isolationist currents in the United States were still strong. Hitler and the rest of the Nazi leadership could not help but interpret this complex situation through the dark haze of Manichaean anti-Semitism. For them, it was obvious that it was Jewish elements in Washington, London and Paris, bent implacably on the destruction of Nazi Germany, that were tightening the international encirclement. And it was this paranoid sense of menace that precipitated Hitler’s decision to launch his strike against Poland and then against the Western coalition that continued to stand obstinately in his way.
It is perhaps not surprising that this factor was not emphasized in the speeches that Hitler made to the military leadership between May and August 1939–certainly not in the notes taken by the military men who attended. But after the fact Hitler made no secret of its importance. Most emphatically in their conversations with the Italian leadership in the spring of 1940, both Hitler and Ribbentrop stressed the role of world Jewry in forcing the pace of events in 1939. And what is more, this peculiar combination of strategic and economic factors, overarched by Hitler’s abiding anti-Semitic obsession, is capable not only of accounting for Hitler’s decision to go to war. It can also make sense of his subsequent willingness to escalate the conflict to an ever larger scale. The decision to risk a general European war over Poland, the decision in the summer of 1940, after having defeated France but not having defeated Britain, to begin immediate preparations for an attack on the Soviet Union and finally in November–December 1941 the decision to support Japan in its aggression against the United States, all followed the same pattern. Faced with the coalition of enemies that had first shown itself in 1938, orchestrated, as Hitler believed, by the ‘chosen one of world Jewry’, he knew that time was not on his side. The combined economic might of the Western powers, added after June 1941 to that of the Soviet Union, was overwhelming. If he was ever to secure the Lebensraum that Germany needed for true strategic freedom, Hitler needed to strike hard and fast.
In relation to the early years of World War II, there are four points of novelty to emphasize as conclusions of this book.
The anti-Western turn in Nazi anti-Semitism, which we have identified as an important theme of 1938–9, continued unabated throughout 1940 and 1941. Having precipitated the war by backing Britain and France in their guarantee for Poland, Roosevelt was now prolonging the war by backing Churchill in his refusal to surrender, a constellation which in Berlin could be explained only by reference to the malevolent role of Jews in both Washington and London. This in turn implies that as far as motivation is concerned any hard and fast distinction between the wars in the West and the East must be softened if not abandoned altogether. Though in their modes of execution the wars were drastically different, to think of them as motivated in fundamentally different ways is mistaken. The war in the West against Churchill and Roosevelt was no less an ideological war than the war for Lebensraum in the East. And though the primary motivation for invading the Soviet Union in 1941, as opposed to a later date, was to force the pace of events in the West, by driving Britain into submission before America could intervene, this too must be seen as part of the larger war against world Jewry. To counterpose this ‘strategic rationale’ to Hitler’s long-held ideological vision of a war of conquest in the East is to pose a false alternative. Since 1938 Hitler had seen himself as locked in a global confrontation with world Jewry. Linking the campaign in the East to the war in the West, therefore, in no way diminishes its ideological content.
Having cleared aside that possible source of misunderstanding, the second point to make is that there was a compelling economic case for Hitler’s decision to widen the war in 1941. The astonishing defeat of France in the early summer of 1940 had promised to change everything. But in fact the Wehrmacht’s spectacular victory did not resolve Hitler’s fundamental strategic dilemma. The German navy and air force were too weak to force Britain to the negotiating table. The competitive logic of the arms race continued to apply in 1940 and 1941. Rather than surrender to Hitler’s will, Britain proved willing to go to the point of national bankruptcy before being rescued by lend-lease. And thanks to its comparatively abundant foreign reserves and American assistance it could mobilize a far larger percentage of foreign resources than Germany at this critical point in the war. In Berlin, by contrast, once the euphoria of victory had worn off, a considerable disillusionment set in over the economic viability of Germany’s new Grossraum. Conquering most of Western Europe added a drastic shortage of oil, nagging difficulties in coal supply and a serious shortage of animal feed to Germany’s already severe deficiencies. The populations of Western Europe were a vital asset, as was their industrial capacity, but, given the constraints imposed by the British blockade, it was far from clear that these resources could be effectively mobilized. Unless Germany could secure access to the grain surpluses and oil of the Soviet Union, and organize a sustained increase in coal production, continental Europe was threatened with a prolonged decline in output, productivity and living standards. Added to which, Roosevelt had launched his own spectacular rearmament programme within days of Germany’s breakthrough at Sedan. The strategic pressure on Hitler to pre-empt decisive American intervention in the war can only really be appreciated if we do full justice to the scale of the Anglo-American effort from as early as the summer of 1940. In this respect, the truly vast discrepancy between Anglo-American aircraft procurement and Germany’s relatively insignificant outsourcing to France and the Netherlands is very telling. It was an imbalance that was not lost on Goering and the German Air Ministry.
Giving due weight to the trans-Atlantic arms race in German calculations in 1940–41 also helps us to explain another conundrum which has continued to preoccupy students of the Nazi regime and which seriously influences the way in which we write its history. Contrary to the claims of some authors, the Ostheer of 1941 was considerably more powerful than that which invaded France. But it is equally undeniable that it was a force carefully calibrated on the assumption that the Red Army could be destroyed in a short campaign. German planning provided for no margin of error. Even on a charitable reading, therefore, the Barbarossa campaign was surrounded by enormous risks. It appears irrational and foolhardy when this evidence of minimal mobilization is combined with the most widely cited industrial statistics, which appear to show stagnation in armaments output and a catastrophic collapse in labour productivity between 1940 and 1941. In the light of this data, it would seem that complacency and inefficiency following the victory over France, combined with racist condescension towards the Soviets, prevented the Wehrmacht from maximizing its chances in what was clearly the decisive campaign of the war. If this were true, this moment of ‘failure’ should clearly stand at the centre of our entire interpretation of Hitler’s regime. However, once we consider the wider strategic situation and combine this with critical scrutiny of the economic evidence, a very different picture emerges. The idea that armaments production in Germany lagged in 1940–41 and that there was a dramatic collapse in productivity is in large part a statistical illusion. Furthermore, a narrow focus on armaments production ignores what was one of the most distinctive features of the early German war effort, a huge wave of investment that continued almost uninterruptedly between 1939 and 1942. When we give this its due weight, we realize something crucial. Thanks to America’s backing for Britain, Germany continued to be locked into the logic of the trans-Atlantic arms race, even whilst it was girding itself for Barbarossa. Germany’s industrial resources could never be fully concentrated on the Soviet Union, because at the same time enormous preparations needed to be set in train for the coming air war with Britain and America. It was after the stupendous German military victories in France, therefore, that Hitler adopted what can justifiably be described as a Blitzkrieg strategy, a coordinated strategy in which both armament production and strategic planning were premised on the assumption of swift and decisive battlefield victory over the Red Army. Its purpose, however, was not to cushion the civilian population. Its purpose was to allow Germany to fight two wars at once.
One might in fact say that the Third Reich in the spring of 1941 was preparing itself not for two wars, but for three wars: one against the Red Army, one against the British and Americans and a third against the civilian population of Eastern Europe, beginning with the Jews. And here too ‘pragmatic economic’ motives and genocidal ideology were inseparably intertwined. On the one hand the SS programmes of genocidal population clearance, to begin with the Jews, were embedded in the Generalplan Ost in an extraordinary vision of agricultural and industrial colonization. Conversely, in the Hunger Plan agreed by the Ministries in the spring of 1941 the most straightforward pragmatic calculation of the food supply was combined with assumptions of racial hierarchy to produce a plan for mass murder, which dwarfed even the Wannsee programme.
This global Blitzkrieg, this grand strategy of racial war, turned out, however, to be a strategy not of victory but of defeat. Already at Smolensk in July–August 1941 Barbarossa ran aground. Meanwhile America was ever more firmly committed to providing aid both to Britain and the Soviet Union. Faced with the ever greater certainty of having to fight a two- or even three-front war, the extraordinary strategic synthesis that the Third Reich had concocted over the previous twelve months fell apart. By December Hitler, true to his conspiratorial logic, had declared war on the United States in alliance with the Japanese. Convinced that open war with the United States was, in any case, only a matter of months away, he seized on the strategic diversion provided by the Japanese offensive in the Pacific. It was to his verbal exchanges of January 1939 with Roosevelt that Hitler repeatedly returned in the autumn of 1941 as he was mulling over both the ultimate shape of the Final Solution and the possibility of a strategic escape from the two-front war in which the Third Reich now found itself.
By any reasonable estimation, Hitler’s declaration of war on the United States sealed the fate of Germany. The economic and military forces arrayed against the Third Reich by early 1942 were overwhelming. As we have shown, this fatalistic view was shared by all those most closely involved with the management of the German war effort up to the Moscow crisis. Udet of the Luftwaffe, Fromm of the army, Thomas of the Wehrmacht high command, Todt in the Armaments Ministry, Canaris in intelligence, Rohland and his colleagues in the Ruhr, all came to the same conclusion. All these men had thrown in their lot with Hitler’s regime. But they were not ignorant of the basic trends of early twentieth-century history. They were as convinced as the vast majority of their contemporaries of the pivotal importance of the United States economy. None of them doubted that once American industrial capacity was mobilized–and they were fully aware of the measures that had already been taken in 1940 and 1941–Germany’s situation would be worse than that of 1918. To have thought anything else would have been to fly in the face of contemporary common sense, well reflected in the anxieties of the general public that were faithfully recorded by Gestapo informants. The full extent of America’s production triumphs after 1942 came as a surprise even to the Americans. But the basic script had already been written in 1917–18 and in the endless retelling of the Fordist narrative throughout the 1920s and 1930s. And the fact was, of course, that the pessimism of the leading German experts did not even give full weight to the extraordinary industrial and military staying power of the Soviet Union that in fact turned out to be the Wehrmacht’s main problem in 1942 and 1943.
This pessimism, however, should throw stark light on the group of individuals who took charge of the German war effort in the aftermath of the Moscow crisis. There has never been any argument about the motivations of men such as Herbert Backe, the orchestrator of the Hunger Plan, or Gauleiter Fritz Sauckel with his pan-European press-gangs. Nor should there be any further argument about Albert Speer. These men were not unpolitical agents of technocratic efficiency. They were the Hitler loyalists willing to do their bit for the Third Reich to the bitter end. They were the men on whom Hitler could rely even in the last months of the war. And they would literally stop at nothing to continue the fight. Speer’s ‘armaments miracle’ relied on resources mobilized by every facet of the Nazi state. The Reichsbank, the Ministry of Economic Affairs and the Finance Ministry played an important but largely unacknowledged role in preserving the stability of the German currency, at least until the beginning of 1944. German industry rallied all its energies in a desperate effort to prevail against the Soviet Union. But these seemingly innocuous components of the German war effort were multiply interconnected with the sinister nexus of political power organized around the questions of labour and food by Gauleiter Sauckel, State Secretary Herbert Backe, Hermann Goering and Heinrich Himmler. Through their combined efforts, in 1942 millions of extra workers were mobilized for German industry and the food balance of Europe was drastically redistributed so as to secure the calories and protein necessary to fuel Albert Speer’s armaments miracle. As we showed in Chapter 16, in the summer of 1942 even the wholesale gassing of the Jews of Poland was made to serve a functional purpose in this radicalized form of Total War. And from the summer of 1943 onwards Speer came to rely ever more heavily on a coercive partnership with Heinrich Himmler and the SS.
The emphasis on rationalization in the management of the German war effort that emerged from the crisis of 1941 was certainly new. And after Speer’s appointment German armaments output did increase. However, to treat this as the apolitical expression of Speer’s technocratic abilities is to miss the point. The entire purpose of the ‘armaments miracle’ was political. Loudly trumpeted by the new line in ‘armaments propaganda’, it served to answer the fundamental doubt that increasingly beset the German war effort. The essential message of the rationalization campaign was that Germany’s obvious material inferiority need not be fatal. With the proper application of will-power and energetic youthful improvisation, more could be produced for less. And, as the Wehrmacht had so often demonstrated, there was no limit to what German soldiers could achieve, provided only that they had the necessary weapons.
The point is not of course to dismiss entirely the increase in armaments production achieved by Speer and Milch. It was real enough. But no less real was its strategic failure. The essence of Hitler’s gamble in December 1941 was timing. After the declaration of war on the United States the need to achieve a decisive success against the Red Army was more pressing than ever. In this crucial respect Speer’s Armaments Ministry failed. In 1942, in the first full flush of the ‘armaments miracle’, Germany was considerably outproduced by the extraordinary mobilization of the Soviet economy. This Soviet effort was unsustainable. By 1944 Germany had caught up with and overtaken the Soviet Union. But as both the Soviets and the Germans knew, the summer, autumn and winter battles of 1942–3 were the key to deciding the war on the Eastern Front. And in this crucial period it was the Soviet factories that prevailed. This window of opportunity was so important because during most of 1942 Britain and America’s offensive operations against the Third Reich were marginal in their impact. As of the autumn of 1942 this was no longer the case. The weight of British and American material made itself felt first in North Africa and the Mediterranean, then in the defeat of the German U-boats and, as of the spring of 1943, in sustained aerial bombardment. Combined with the elimination of Mussolini in July 1943, the opening of a significant ‘second front’ had a truly dramatic effect. For six months in 1943 the disruption caused by British and American bombing halted Speer’s armaments miracle in its tracks. The German home front was rocked by a serious crisis of morale. By July 1943 the war was obviously lost.
The final, famous acceleration of German armaments production in 1944, on which the reputation of Speer’s Armaments Ministry largely rests, took place amidst a maelstrom of apocalyptic violence that consumed the lives of millions of people and laid waste to a large part of the Continent. First in the Mittelbau and then in the brutal practices of the Jaegerstab, the murderous violence of the SS police state was imported directly into the war economy. Tens of thousands of out-of-date fighters were squeezed out of Germany’s factories in the first half of 1944 by mobilizing all available labour and materials, applying virtually limitless powers of repression and exploiting every possibility for economies of scale. In the summer of 1944, Speer and the Jaegerstab maintained a telephone hotline to the ramp at Auschwitz, where SS guards were processing the Jews of Hungary, the last great population to be fed to the gas chambers. It was in the dank, deathly gloom of Hans Kammler’s underground factories that the Third Reich made its final futile bid to match the Americans in mass-production.
Hitler had prophesied that if Germany did not prevail against its enemies, it would face a national catastrophe unlike anything in modern history. From 1942 onwards he and his collaborators, Albert Speer chief amongst them, steered Germany directly towards this outcome. Even now, the damage inflicted by Hitler’s regime and by his futile war is almost unbearable to contemplate. Decades after the event, the memory of the harm done–to the population of Europe, to the physical fabric of daily life, to the very idea of European civilization–is still enough to inspire feelings of despair, rage and resentment, and not only on the part of Germany’s victims. Here is not the place to attempt a review of this horror. But since economic historians have ways of making disasters, such as that which Germany brought down upon itself in 1945, disappear from the long-run trajectory of economic growth, it is worth lingering a little on this scene.
The destruction and human misery in Germany in 1945 is barely describable in its scale.2 As the Third Reich collapsed, quite apart from the millionfold murder that Germany had committed across Europe, more than one-third of the boys born to German families between 1915 and 1924 were either dead or missing. Amongst those born between 1920 and 1925 losses amounted to 40 per cent. The rest of the German population was subject to uprooting and displacement on a truly epic scale. Whilst the 11 million Wehrmacht men who had survived the war in uniform were herded into makeshift prisoner of war camps administered by the occupying forces, a similar number of 9–10 million non-German displaced persons enjoyed an unwonted degree of freedom, whilst they waited to be repatriated to their homes in Eastern and Western Europe. At the same time 9 million German evacuees streamed back towards their devastated cities. Meanwhile, to the east there was an extraordinary human avalanche, as 14.16 million ethnic Germans were driven systematically out of their homes in Eastern and Central Europe by the embittered Slav population. Of this spectacular exodus at least 1.71 million would die en route. The country to which they ‘returned’ presented a scene of devastation and poverty that defies description. Large parts of Germany had been reduced to ‘a rubble-strewn wasteland in which the living often envied the dead’.3 At least 3.8 million out of a stock of 19 million apartments had been destroyed. In the cities hit hardest by the bombing, losses in housing stock ran to 50 per cent.4 Huddled in overcrowded and half-ruined apartments, the German population, which until the autumn of 1944 had been reasonably well fed, now starved and froze.
Unlike the Germans during their reign over Europe, the Allies did what was necessary to keep the German population alive. But they did so with reservations. As General Lucius D. Clay, Eisenhower’s deputy, put it in June 1945: ‘Conditions are going to be extremely difficult in Germany this winter and there will be much cold and hunger. Some cold and hunger will be necessary to make the German people realize the consequences of a war which they caused.’5 Nevertheless, Clay also insisted that ‘this type of suffering should not extend to the point where it results in mass starvation and sickness’.6 Joint Chiefs of Staffs Directive 1067, the basic instructions issued to the occupying forces in 1945, specified that food should be provided to Germany sufficient only to prevent ‘disease and unrest’. Until 1948, however, the food supply in all four zones of occupation fell well short of what was required. As a direct result of decisions taken by Speer and the Zentrale Planung in 1943 and 1944, the nitrogen fertilizer needed by German farms had been directed instead to the production of explosives and ammunition. Yields were drastically down. To make matters worse, Germany’s richest grain surplus area east of the Oder–Neisse was awarded to the Poles at the Potsdam agreement. Supplies were brought in from across the Atlantic, but by the early summer of 1946 rations in many parts of urban Germany were below 1,000 calories per day. Despite the flourishing black market, the evidence of serious malnutrition was unmistakable. Mortality increased as did the incidence of hunger-related diseases. Infection rates for diphtheria, typhoid and tuberculosis in the British and American zones doubled. The birth weight of babies fell drastically. Even the most intrepid statisticians hesitate to plumb the depths to which Germany had fallen by the end of 1945. Money had long since ceased to function in any ordinary sense of the word. One estimate for 1946 puts German per capita GDP at just over $2,200, a figure not seen since the 1880s, one-tenth the level that Germans enjoy today. And this certainly exaggerates the actual level of economic activity in the second half of 1945. Coal production, the lifeline of modern urban society, was down by 80 per cent, and the coal that was available could not be distributed, given the ruination of the railway system.
Nor should we underestimate the intensity of hatred felt towards Germany by its neighbours and former enemies. If it is true that Germans after 1945 were forced to swallow at least some of their sense of vic-timhood, it is no less true that Germany’s former enemies thought it better to forget the sense of rage that clearly motivated much of Allied policy in the immediate aftermath of the war. In 1945 along the Dutch-German border, American GIs passed signs that read: ‘Here Ends the Civilized World’.7 It is one of the most persistent myths in post-war history that the Allies learned the lesson from World War I not to extract reparations from Germany. In fact, both halves of Germany paid substantially higher reparations after 1945 than the Weimar Republic ever did. Not surprisingly, the Soviets were most determined in their pursuit of compensation. What was to become the German Democratic Republic suffered the dismantling of at least 30 per cent of its industrial capital stock and paid occupation costs and reparations to the Soviet Union which even in 1953 still totalled almost 13 per cent of its national income.8 The Federal Republic for its part was more leniently treated. But it too made payments between 1953 and 1992 totalling in excess of 90 billion Deutschmarks. And it was not merely physical capital that was dismantled. In the Soviet zone, tens of thousands of suspect members of the Nazi party were rounded up for interrogation and summary trials. Many thousands were executed. The Western powers, not surprisingly, adopted more legalistic procedures. Roughly 200,000 Nazi suspects were arrested and detained in internment camps, including many leaders of German big business. Of 5,153 individuals accused of major war crimes, 668 were condemned to death by military tribunals. In addition, in the first burst of enthusiasm, the Western Allies dismissed almost half the civil servants in their zones and required millions to register for denazification. Though this process ultimately degenerated into a cynical farce, in its early stages it was perceived by the German population as a threatening intervention in the structure of social life. Viewed in conjunction with the high-profile trials at Nuremberg, it was one more sign of Germany’s pariah status.
The initial post-war period thus went a long way towards confirming Hitler’s apocalyptic view of politics. Germany had ceased to exist as a political entity, as a military force or an economic unit. The terrible irony, however, is that in the years that followed it was not Hitler’s logic but Stresemann’s that prevailed. In 1919, with his eye on the Bolshevik threat in the East, Stresemann had predicted that the time would soon come when Germany would again be needed. After World War II, with the Red Army in Vienna and Berlin, it took barely two years for the same insight to impose itself in Washington and London. To stave off collapse and a surge in support for the Communist party, reconstruction began already over the winter of 1946–7. In the 1920s Stresemann had gambled that the German economy was so integral to the wider economy of Europe that it would be in the interest of none of the victor powers to see it permanently crippled. In 1947 American Secretary of State General George Marshall made his famous offer of aid to Europe dependent on the inclusion of Germany. At first this was hard for France to swallow. France’s national programme of economic reconstruction after 1945 was premised on the assumption that it would be France not Germany that controlled the resources of the Ruhr. But within three years of Marshall’s announcement, it was the French, as they had done in 1929, who came forward with proposals for European integration based this time around a European Coal and Steel Community and a European Defence Community. To complete the bitter irony, Konrad Adenauer, who as the Chancellor of the Federal Republic between 1949 and 1963 was to steer West Germany towards its position at the heart both of the European Community and NATO, was in fact two years older than Gustav Stresemann, who had been only 51 at the time of his death in 1929.9
A functioning parliamentary system, an alliance with America and closer European economic integration were all goals to which Stresemann clearly aspired. But in the 1920s Weimar politics had still been animated and ultimately destabilized by the idea that Germany would one day re-emerge as a great power in the classic eighteenth- and nineteenth-century sense. What precisely this meant was already questionable in the aftermath of World War I and its demonstration of the futility of war as a means of great power politics. But ‘freedom of action’ in international relations was clearly still constitutive of full sovereignty, for Stresemann as much as for most other Europeans. After the horror of Nazism and World War II, democratization, the Western alliance and closer European integration were all back to the fore. The apocalyptic temptation of militarism was largely exorcized from Europe. Its dying embers flared up only occasionally in the rearguard actions of empire. But with it also went any aspiration to the ‘freedom’ once implied by great power status. As early as the autumn of 1943, after the Battle of Kursk, the United States had realized that the dominant power in Europe for the foreseeable future would be the Soviet Union, not Britain, let alone France. At first Roosevelt’s administration hoped to adjust to this new reality in cooperation with the Soviets. Together the two superpowers would rule both Europe and the world, under which circumstances it might have been possible to ‘do without Germany’. But by 1947 that option was clearly off the table. First West Germany and then East Germany were resurrected as independent states. Their subsequent economic recovery along with that of the rest of Europe was one of the true miracles of the twentieth century. The success in creating a democratic polity in West Germany was also remarkable. So free, in fact, did West Germany seem of the tensions that had plagued the Weimar Republic, that some were even tempted to suppose that the curative fire of National Socialism had been necessary to drive out the German demons. What this ignores, however, is that German democracy after 1945 was not as anyone had imagined it in the 1920s. It existed within a strange and truncated form of statehood and much the same might be said for most, if not all, of the former ‘great powers’ of Europe. Through the middle of Germany’s territory ran the new battle lines of the Cold War. Huge forces of occupation were massed on either side, non-European forces–American on one side, Soviet on the other. The threat of nuclear annihilation hung over everyone. And though West Germany certainly had a functioning democracy, the scope of political debate was also incomparably more restricted than it had been in the 1920s. The most explosive issues of Weimar politics–the question of territorial integrity and the question of military parity–were removed, it seemed, for ever from the political agenda. The economic miracle was the abiding preoccupation of the West German Republic, as it was for the rest of Europe. The drama of twenty-five years of unprecedented economic growth moved ‘politics’, in the classic sense, to the sidelines. Even the remarkable project of European integration resolved itself into an endless process of bartering over milk quotas and national rebates. The catastrophe of the Third Reich had not brought about the extinction of Germany, but what it had done was to draw the curtain on the classic era of European politics. Sixty years later, what else there might be to politics in Europe beyond the tiresome squabbles of discontented affluence remains an open question.
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