Nazis economy Flashcards
What were the Nazis economic aims?
-drag Germany out of the worldwide recession
-solve unemployment
-make Germany an ‘autarky’ (self sufficient country
-transform the economy to focus on rearmament and war
How did Germany aim to solve the economic issues between 1934-1936?
-targeted the workers and wanted more people working rearmament->triggers arms (guns) manufacture, autarky, bring Germany out of the recession, RAD->Reich Labour Service (hides unemployment)->young men set to work on ‘war’ projects, Schacht tried to control imports and exports, tariffs (generate money), Mefo bills->hides government spending, control government expenditure
What does autarky mean?
-the aim for self-sufficiency in the production or food and raw materials especially at war
What was the reason Germany had lost WW1?
-they had relied on overseas trade for vital raw materials and food supplies->they hadn’t been able to maintain these supplies
What was Schacht’s economic policy? (summarised)
-banking and control of capital->lowered interest rate and rescheduled debts
-assistance for farming and small businesses->tariffs maintained and subsidies and grants
-state investment->RAD and public works
Who was responsible for the Rentenmark and the German economic policy?
-Schacht->president of the Reichsbank
What did Schacht believe?
-steady growth
-stable currency
Was Schacht a member of the Nazi Party of the economic elite?
-economic elite
What was Schacht’s economic policy to do with banking and control of capital?
-banking and control of capital->the banking system had been weakened by the Wall Street Crash and Depression
-lowered interest rate->the state took control of interest rates and kept them at a low limit to reduce debt
-rescheduled debts->large debts of local authorities were paid off over a longer period of time
Why did Schacht take control of interest rates?
-if interest rates remained high it would add to the amount of debt the government had to pay off
-by keeping interest rates low they wouldn’t need to pay off as much debt although it would also mean that people wouldn’t make money on their savings
Why were local authority debts prioritised?
-if they were paid off over a longer period of time->then money would be available to invest in local services which would satisfy the German population
What was Schacht’s economic policy to do with assistance for farming and small businesses?
-designed to stimulate growth and reward loyal supporters
-tariffs maintained->tariffs put on imported goods to protect German farmers
-subsidies and grants
-Reich Food Estate offered subsidies to support agriculture
-Reich Entailed Farm Law->debts were reduced offering land ownership security (debts were reduced by tax concessions and lower interest rates)
-allowances to encourage rehiring of domestic servants
-grants for house repairs
Who were financial benefits given to? What did it stimulate?
-given to groups eg farmers and small businesses
-stimulated economic growth but also rewarded some of the most sympathetic supporters of the Nazis in the 1930-1933 elections
What is a tariff?
-a tax or duty to be paid on a particular class of imports or exports
What is a subsidy?
-a sum of money granted by the state or public body to help an industry or business keep the price of a commodity or service low
What are concessions?
-a thing that is granted especially in response to demands
What was assistance for farming and small businesses designed to stimulate?
-growth
-reward loyal supporters
What did assistance for farming and small businesses include?
-tariffs put on imported goods to protect German farmers
-allowances to encourage retiring of domestic servant
-grants for house repairs
What did the Reich Food Estate offer?
-subsidies to support agriculture
What was the Reich Entailed Farm law?
-debts were redacted offering land ownership security (debts were reduced by tax concessions and lower interest rates)
What was Schacht’s economic policy to do with state investment?
-started under Von Papen
-Reich Labour Service (RAD)->employ 18-25yr olds (members not counted in unemployment figured->involved 6 months of unpaid work, mainly in military construction projects
-1935 compulsory military conscription
-public works->reforestation, land reclamation, motorisations (developing a vehicle industry), infrastructure and building projects (housing sector and public buildings
What was the main direct spending by the state on a range of investment projects?
-mainly in rearmament, construction and transportation
Who started the state investment?
-Von Papen
What was made compulsory in state investment in 1935?
-military conscription
What policies were in Schacht’s New Plan of 1934?
-Bilateral Treaties
-Regulation of the Reichsmark currency
-Mefo Bills
What did Bilateral Treaties include in the New Plan?
-aimed to promote trade and save foreign exchange->mainly with SE European countries
-Barter agreements were set up rather that imports being paid with money
-Soviet Union agreement was set up in 1935
What did the regulation of the Reichsmark currency include in the New Plan?
-Germany agreed to purchase raw materials from all countries it traded with on the condition that Reichsmarks were used to buy back Germany goods->protested their income
What were Mefo Bills and what did they do in the New Plan?
-special government money bills (like a credit note)->they were guaranteed by the government and were held up for 5 years at 4% interest
-they disguised and delayed government spending
What was a result of Schacht’s New Plan of 1934?
-meant that Germany gained more control and were able to prepare for war and gain more power as a country
-they became more in control over what the government was able to spend and they could disguise their spending’s more
What did the New plan involve?
-strict government controls over spending
-reduced imports->autarky and saving money and not giving money to other countries which would make them stronger
-protecting German currency
-Mefo Bills (credit note)->disguises government spending
Which 2 men were in charge of Nazi economic policy?
-Goring
-Schacht
Why did Hitler get rid of Schacht?
-he wasn’t focusing on the same things as Goring (rearmament and autarky)
What was the focus on Goring’s Four Year Plan?
-autarky and rearmament
