The Economy (P1)

Question 1

Economic Background

Answer 1

• Hitler didn’t tie himself down to details on economy, and wanted to avoid comments on it, despite him recognising it was very important and would be judged upon it. They had a number of different approaches

Question 2

What were the initial approaches?

Answer 2

• outlined in 25pp, profit sharing in large industrial enterprises, and the nationalisation of businesses. Hitler accepted this, but never committed to it
• Deficit Financing - by spending money on public works, deficit financing was intended to create jobs, which would stimulate the economy
• Wehrwihrschaft - economy was gearing towards total war, so they avoid problems of WW1
• Overall, reacted to things when it happened, rather than planning

Question 3

Economic Condition 1933; Trade

Answer 3

• Germany depended on its capacity to sell manufactured goods
• slump of world trade, need for German exports declined

Question 4

Economic Condition 1933; Industry

Answer 4

• despite its post war problems, Germany was still an industrial power
• began to lose economic confidence in 1929; the demand fell

Question 5

Economic Condition 1933; Employment

Answer 5

• 1929; 1.9 mil unemployed

- 1932; 5.6 mil unemployed

Question 6

Economic Condition 1933; Agriculture

Answer 6

• agricultural depression deepened, leading to widespread rural poverty
• prices fell and the farmers fell

Question 7

Economic Condition 1933; Finance

Answer 7

• war debts, reparations and inflations - financial problems had been apparent for years prior to 1933

Question 8

1933-36 - Economic Recovery; Problems

Answer 8

• depression destroyed W.Republic
• Germany short of essential raw materials
• Lacked foreign currency to pay for imports
• Slump in the world trade
• 1933 - 5.5million unemployed

Question 9

1933-36 - Economic Recovery; Solutions (list)

Answer 9

• Expansion of public works 1932
• Tax concessions and grants
• Reich Labour Service

Question 10

Expansion of Publics work 1932

Answer 10

• building houses and motorways
• stimulates private economy - providing jobs
• after completion, helps with transport, schools hospitals etc

Question 11

Tax Concessions and grants

Answer 11

• e.g for newlyweds. This helps to free up jobs, persuading women to stay at home. They weren’t classed as unemployed, therefore W.S don’t have to provide for them
• Subsidies - gov paid company a little so they could employ more, increasing productivity, less people on doll, more people paying tax

Question 12

Reich Labour Service

Answer 12

conscription took unemployed men off the official register (extended to women in 1939). The armed forces grew to 1.4mil 1939

Question 13

Hjalmar Schacht

Answer 13

• appointed as President of Reichsbank March 1933, then in August 1934, as Economics Minster. He was appointed when Hindenburg died.
• Schachts not a Nazi
• he was given dictoral powers over the economy - used to introduce the ‘New Plan’ of Sept 34

Question 14

Hjalmar Schachts Methods

Answer 14

• Bilateral Trade Treaties
• The Reichsmark Currency
• Mefo Bills

Question 15

Bilateral Trade Treaties

Answer 15

• straightforward barter agreements - avoiding needs for currency exchange
• Germany exerted powerful economic influence over Balkans

Question 16

The Reichsmark Currency

Answer 16

• Germany agreed to purchase raw materials from all countries it traded with on the condition Reichsmark was used to buy back German goods

Question 17

Mefo Bills

Answer 17

• like a credit note designed by Schacht

Question 18

By mid 1936

Answer 18

• unemployment had fallen to 1.5mil

- industrial production had increased by 60%