Nazi Germany 1933-39: German Economy 1933-39

Question 1

Why were economic problems a Nazi priority?

Answer 1

• Unemployment was at 6.1 million in 1932
• Hitler had promised to solve problems for the maases
• Hitler needed a strong economy to fulfil his policy of “Taking back what was Germany’s”
• Hitler had aimed to prepare Germany for War by 1942

Question 2

What were Hitler’s economic aims?

Answer 2

• Pull Germany out of the worldwide recession
• Solve unemployment
• Make Germany an “Autarky”
• Transform economy for rearmament and War

Question 3

Who was Schacht?

Answer 3

President of Reichsbank, responsible for Rentenmark

Question 4

What was Schacht’s economic policy?

Answer 4

• Lower interest rates and reschedule debts
• Assist farming and small businesses with tariffs and subsidies
• State investment in RAD and public works

Question 5

What was the RAD?

Answer 5

Reich Labour Service, employed 18-25 year olds who weren’t counted in figures.

Question 6

What did Schacht’s New Plan consist of financially?

Answer 6

• Bilateral treaties
• Regulation of Reichsmark Currency
• Mefo Bills

Question 7

What were bilateral treaties?

Answer 7

Promoted trade with southeast Europe via barter agreements

Question 8

How was the Reichsmark regulated?

Answer 8

Germany traded on condition that Reichsmarks were used to buy back German goods.

Question 9

What were Mefo Bills?

Answer 9

Government bills were guaranteed, holding for 5 years at 4% interest. This disguised government spending.

Question 10

What were the impacts of the New Plan?

Answer 10

By 1936

Question 11

What were the impacts of the New Plan?

Answer 11

• By 1936 unemployment was 1.5 million
• Industrial production increased 60%
• GNP had grown by 40%

Question 12

What was “guns or butter”?

Answer 12

Schacht was focused on industrial production whereas Hitler and Goring favoured rearmament

Question 13

What was Goring’s 4-year Plan?

Answer 13

• Regulate imports and exports, focusing on chemicals and metals
• Control labour force
• Increase production of raw materials
• Develop substitutes such as artificial rubber
• Increase agricultural production
• Create wartime economy during peacetime

Question 14

What were the impacts of the 4 year plan?

Answer 14

Goring came into conflict with Schacht

• Schacht resigns 1939
• Not fully supported by business leaders
• Siemens electrical production
• Daimler-Benz transport production

Question 15

Was Autarky successful?

Answer 15

• In 1939 Germany still imported 33% of raw materials
• Fewer personal and household goods available
• Caused deficits as limited exports

Question 16

Was Hitler successful in dragging Germany out of recession?

Answer 16

• Wages rose slightly but still lower in 1938 than 1928

- 1936 GNP up 40% and production up 60%

Question 17

Was Hitler successful solving unemployment?

Answer 17

• Dropped to 4.8 million 1933, 0.5 million 1939

- These were skewed by RAD and removing women and Jews

Question 18

Was Hitler Successful in rearmament?

Answer 18

• Schacht resigned, support of businessmen was lost

- Rearmament caused deficits as it limited exports