ia_2011_b_gadd

=B. Summary of Evidence (500-600 words) Tips]=

=__ Economy during the Third Reich __=

When Hitler became chancellor in 1933 the economy was a complete mess and Germany was facing “major economic difficulties” [1]. When the world trade collapsed in earlier years, America had no other option but to redraw all its money that was on loan to Germany, leaving Germany without the money to repay the reparations to France and Britain. Food production per capita had reduced by 49% between the years of 1938 and 1947, and the “official food ration set by the occupying powers” allowed only between 1,040 and 1,550 calories a day [2] .Along with the lack of income from America, it became almost impossible to export goods to the countries and they simply didn’t have the money to pay for it, leaving Germany in a vicious downwards spiral. Germany wasn’t the only country were the exporting was affected because of the world trade collapse and this in turn affected Germany in a different way. Germany relied upon many “foreign sources” to get their raw materials [3 ], so when America withdrew their money it mean that Germany didn’t have very much money and could not afford to get as many important, leaving them lacking in certain essential raw materials.

=__ How Hitler Improved the Economy __=

The Nazi economic recovery is known as a miracle because of the rate in which they did it. During the years of 1932 and 1938 the economic status of Germany had been transformed completely, and to a “higher level than almost anywhere else in Europe” [1 ]. Hitler, with the help of others, came up with different policies and plans to improve the economy and get Germany back on track. One plan to improve the economy was the use of propaganda. They used this to persuade people to join different jobs in order to rise the unemployment rates, they also used propaganda to persuade everyone that Hitler would improve the economy Dr Hjalmar Schacht was the one who thought of the ‘New Plan’. When the Nazis came into power, Dr Hjalmar Schacht was the one that Hitler trusted with Germany’s economy by 1934 he was the president of Reichsbank and the Minister of the Economy. He had always supported Hitler, even before he came to power. Dr Hjalmar Schacht was a “financial expert and trusted by business people in Germany and by foreign leaders and bankers.” [1]. The four main features of Schacht’s New Plan were to “limit the imports, get trade agreements with different countries, government spending was more controlled and the rate of unemployment was to be reduced.” [1]

The materials that were imported into Germany were carefully controlled so that only certain materials were imported, and only a limited amount of it. Because of the lack of money in the economy they had to be extra careful with what they spent it on, but the raw materials are essential for everyday life. The trade agreements were made so that Germany could get some raw materials by trading it for some German good. Hungary is an example of this agreement; they would exchange things like butter, fodder etc. and raw materials for German goods. Government spending had to be controlled as the country had to be careful with the money. They invested in all different types of industries and the government didn’t try and take control of them. Unemployment was a big problem in the Reich and the New Plan found different ways of improving it. Firstly, if there were women that weren’t working they weren’t counted, a quite a big part of the percentage was lost. Hitler wanted to try and get the women of Germany to stay home and look after their children and their husbands, and that was like it was their job. Any males that were unemployed were told that they either had to do the job that the government told them to, or they would be put into a concentration camp and classed as ‘work-shy’. Jews were not classed in the stats as they “lost their citizenship in 1935”, so it was like they weren’t even there, and when conscription was introduced 1935 young men did their time in the army for their country, and were taken off the stats. [5] At first, the New Plan was successful, it cut the cost of German imports from Europe from “7.24 billion Reichsmarks in 1928 to 2.97 billion 10 years later.” [6]However, after some time there began to be complaints. For example, the army admitted that Schacht had managed to find the money that was needed to pay for the initial stages of the rearmament, but when it came to preparing the economy for war, he failed. Also, when it came to the substitutes for the raw materials such as home-grown textiles and synthetic rubber and fuel, it only made a “limited impact”[7] and didn’t actually help very much at all. After a while, the New plan stopped helping the country in a large enough way, Hitler believed that a “more radical intervention in the economy was needed”[6] to continue improving the economy, one that would allow complete rearmament and mobilization by 1936, but this time Schacht couldn’t be trusted with the plan, as he made it perfectly clear that he didn’t think the economy could ever reach a point where this would be possible.

__The Four Year-Plan__
Hitler needed a new plan, and this is where Hermann Goering came in. Goering was probably the most powerful person in the Nazi party (after Hitler of course), he was the head of the German airforce and president of the Reichstag and even though he was not an expert in economy, he was “temporarily made the Ministry of Economics” [8 ]. The aim of his Four-Year plan was to prepare the Germany for war within 4 years, with both him and Hitler working together, they knew, for the experience of the first world war, what they had to focus on. The Four-Year plan also aimed to make Germany self-sufficient in materials that would be needed for the war, so they didn’t rely on other countries.

There were 5 points that the Four-Year plan focused on; “the increase of raw materials, production of synthetic raw materials, reducing imports, tightens control on money, new industrial plants.” [9 ] It was said that these 5 points were what would prepare Germany for war, Hitler always said that "Germany's economic problems could only be definitively be solved by war."[1 An increase of the production of raw materials was essential to the rearmament on the German army, they needed materials such as oil, metal, coal etc. which were too expensive to have imported in large batches. Goering wanted to persuade big businesses to start producing synthetic raw materials such as rubber and fuel that would help with the rearmament. With all the new productions, there was less need for imports, so importation was reduced even more than it had been during the New Plan. Tighter controls were taking on the prices of things they were purchasing and on the wages that were being given out. Finally, huge mining-and metal-work plants were built to as many raw materials as possible.

Billions of Reichmarks was poured into the Four-Year Plan in order to make it successful, but by 1939 Germany still relied on other countries for one-third of its raw materials [8], and butter was still rationed. Goering quoted to the people of Germany // “Guns will make us powerful; butter will only make us fat.” //[11]. It soon became clear that the only way Germany would become self-sufficient was to take over countries that provided raw materials and food that it needed.

Figure 1 - [] **(could not get image onto wiki)** This is a Nazi propaganda poster that was used around 1936 to try and convince the German public that Hitler will get the economy back on track and make everything return to normal. The text reads; “Before: Unemployment, hopelessness, desolation, strikes, lockouts. Today: Work, joy, discipline, comaradarie. Give the Führer your vote!”

[1204 words]

[1] Dale Banham, Christopher Culpin, (2004). Germany 1918-1945: Teacher’s Resource Book. Hodder Murray (ISBN:0719577543), Page 126 [2] [] [3] [] [4] Prepared for the Economic History Society by R. J. Overy (1982). The Nazi economic recovery, 1932-1938. London: Macmillian press (ISBN: 0333311191), Page 1 [5] [] [6] Richard J. Evans (2006). The Third Reich in Power, 1933-1939. London: Penguin Press (ISBN: 1594200742), Page 355, [7] Richard J. Evans (2006). The Third Reich in Power, 1933-1939. London: Penguin Press (ISBN: 1594200742),, Page 357 [8] William L. Shirer (1990). Rise and Fall of the Third Reich. Simon & Schuster (ISBN: 0671728687), Page 311 [9] Dale Banham, Christopher Culpin, (2004). Germany 1918-1945: Teacher’s Resource Book. Hodder Murray (ISBN:0719577543), Page 127 [10] Richard J. Evans (2006). The Third Reich in Power, 1933-1939. London: Penguin Press (ISBN: 1594200742), Page 361 [11] []