pre-war Nazi economy Flashcards
why was Hitler’s response to the Great Depression so important?
was a major reason why German voters switched to supporting extremists parties such as the Nazi party
who was the President of the Reichsbank between 1933-39?
Hjalmer Schacht
who was the minister of economics between 1934-37?
Hjalmer Schacht
how did the Nazis take control of capital?
they set interests rates at a lower level
there was a rescheduling of large-scale debts of local authorities
what did the Reich Entailed Farm Law outline?
debts were reduced by tax concessions for the small farmers
helped improve security of land ownership
who was the minister of agriculture?
Alfred Hugenberg
what measures did Hugenberg introduce?
- made German produce cheaper
- banned banks from repossessing farms from farmers who were in debt
- increased import tarrifs
who set up the RNS?
Richard Darre
what was the RNS?
was set up to regulate food production and the distribution of farm produce
by 1934 how much of German produce was produced in German farms?
80%
when was the Law to Reduce Unemployment renewed?
June 1933
what was the Reichsarbeitsdienst?
the RAD created schemes for unemployed Germans which provided manual work
what schemes did the RAD mainly promote?
reforestation
land reclamation
motorisation
building
between 1933 and 1936 how much had public investment been increased by?
was tripled
unemployed in 1932?
5.6 million
unemployed in 1936?
1.6 million
how was Schacht able to control the public deficit?
he maintained high taxes
he encouraged private savings
how many km of autobahn were constructed under the Nazis?
3000km
when was Schacht’s ‘New Plan’ introduced?
September 1934
what was included in Schacht’s ‘New Plan’?
- bilateral trade agreements
- the Reichsmark
- Mefo bills
why did Schacht look to prioritise bilateral trade agreements?
they did not involve currency exchange as well as allowing Germany to create a foreign influene
who did Germany look to mainly engage in bilateral agreements with?
the Balkans
how did Schacht use the Reichsmark to boost it’s value?
Germany would only agree to purchase raw materials from a foreign country as long as the country used the Reichsmark to buy goods back
what were Mefo bills?
money bills which were issued by the government for goods
how long were Mefo bills held and what happened to them over time
they gained interest of 4% per year
spread across 5 years
what were the reasons for the introduction of Mefo bills?
to disguise government spending
by 1936 how much had industrial growth increased?
60% from 1933
how did the 1935/36 crisis lead to the Four-Year Plan?
Balkan nations started asking for money for raw materials that German imported
Schacht did not want to borrow
only alternative was to cut expenditure and press for higher production
stressed the need for Autarky
what is a command economy?
when the STATE decides what and how much to produce
when was rearmament announced?
March 1935
what did the Law for the Protection of Retail Trade do for small businesses?
stopped the building and expansion of new stores
what was the only union in Nazi?Germany
the DAF
how did Schacht hoped to deal with the rise in expenditure and an increase in the demands for rearmament?
he suggested a reduction in arms expenditure and the increase in industrial production to generate more foreign income through exports
why was Schacht’s proposed solution rejected by both the Nazi govt and the German Army?
rearmament was too large of a commitment for the German Army and it was seen to be the main purpose of the economy
who was put in charge of the Second Four-Year Plan?
Hermann Goering
what timeframe had Hitler outlined for Goering’s command economy?
- the German armed forces were to be ready within 4 years
- the German economy was to be ready for war within 4 years
what were the main aims of the Second Four-Year Plan?
rearmament
autarky
how did Goering look to increase production of raw materials?
raw materials which could not be produced were replaced by alternatives
what was rubber replaced by?
Buna
what was the raw material which was prioritised?
synthetic fuel
what was the ‘guns or butter’ argument?
Hitler had two aims:
- to maintain the support of the people
- to rearm for war
both required opposite policies when it came to the economy
Hitler hoped to be able to balance the two needs
BUT
it turned out that guns had won the argument
what was a substitute product called?
ersatz
why did Schacht resign from his office in November 1937?
he was in massive disagreement with the Four-Year Plan
how did propaganda try to reduce German food imports?
families were encouraged to eat less
AS WELL AS
eating alternatives such as fish and jam which were more available
how did industrialists feel about the early Nazi economy?
they were in favour of the increased industry as well as the increased workforce and schemes available
coal and steel industries massively benefited
which industries suffered from the Second Four-Year Plan?
heavy industry
German alternatives were used instead
which industries benefitted from the Second Four-Year Plan?
electrics
chemicals
which company dominated the Nazi chemical industry and what did they produce?
IG Farben
produced synthetic substitutes to rubber and oil
which company was key in rearmament and transport under the Nazis?
Daimler-Benz
produced trucks and aircrafts
which company was key for the electrical industry under the Nazis?
Siemens
was the Nazi regime ever economically prepared for war?
NO
it should have focussed fully on war production
what was the public reaction to the rearmament?
most Germans did not have an issue with rearmament
it had been achieved without a loss in the consumer goods market as well as no need to raise prices up
