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Was the Nazi economic policy a success or failure?

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Introduction

Was the Nazi economic policy a success or failure? The economic situation in Germany in the early 1930's was very grim. Unemployment was high (8.5 million in1931) and businesses collapsed alongside consumer confidence. Peasants were also desperate as agricultural prices collapsed between 1929 and 1933. The domestic economy was very weak before the Wall Street Crash, already in 1928 3 million were unemployed, and the depression made the situation worse. As the desperate situation of the economy was one of the reasons for the Nazis getting to power in the first place they knew that they would have to do something about it. Also one of their objectives was to create an economy with enough strength to sustain rearmament. The most important challenge facing the Nazis was reducing unemployment. Within their first year, legislation and initiatives were introduced which dealt effectively with the numbers of Germans out of work. The work schemes (Arbeitdienst) first used by Papen and Schleicher in 1932 and 33 were extended by the law to reduce unemployment (June 1933). These Arbeitdienst were part of an overall job creation plan which included the building of the Autobahnen. The so-called 'battle for work' was also extended by the government lending money to large companies so that they could create more jobs. ...read more.

Middle

By 1936 the economy had recovered enough to make this possible however there was the problem of 'Guns v Butter' (rearmament or consumption). Germany was still importing large amounts of food stuffs. The 'battle for production' began in 1934 aimed to increase the production of food stuffs in Germany however agriculture suffered from a lack of machinery and man power. The head of the Reich Food Estate, Walther Darre, asked Schact for foreign currency to import food stuffs but Germany needed to improve raw materials to sustain rearmament and they could not import both. The crisis grew worse by 1936 as Germany had used up all its raw material reserves up and was now forced to buy items from the open market for cash. The only politically acceptable answer to this problem was to cut imports and embark on a policy of greater self efficiency. Goerring was appointed commissioner of raw material in April 1936. This gave him responsibility for making the economy self sufficient. This was partly achieved through manufacturing rubber and oil synthetically. The problem was that the process of producing synthetic oil was expensive. However this was secondary to Goerring who was head of the Luftwaffe and he welcomed any possibility of producing fuel in Germany for his planes. ...read more.

Conclusion

From January 1945 the German economy was in a state of collapse, partly as a consequence of invasion but also due to exhaust and the effects of the allied bombing campaign. The bombing campaign had reduced production of essential war materials by up to 40% in 1944. The use of foreign labour became of even greater importance as all able bodied German men were called to the front line. In an attempt to increase their productivity, marginal improvements were made in the living conditions and pay of the foreign labour force. In March 1944 all eastern workers were given the same pay and benefits as other foreign workers. This is all comparative since conditions for the vast majority of foreigners working for the Nazis were appalling and deteriorated even further during 1945. In many ways the Nazi economic policy was very successful. They restored full employment in Germany and built up its strength which allowed them to dominate Europe by 1941. This success helped Hitler to become the most popular German leader ever. However the extent to which the Nazis were responsible for the economic miracle is debatable. Also Hitler's priorities meant that the majority of the German people failed to benefit greatly from the economic growth. The most impressive achievement was the recovery from the depression. Autarky (self sufficiency) was never achieved and rearmament was wasteful as the war was ultimately a failure for Germany. ...read more.

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