Did the banks make Hitler start WW2?

Discussion in 'Military History and Militaria' started by Micawber, Jun 21, 2011.

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  1. I was pondering how we can barely afford to keep a 100,000 strong standing army these days when I began to wonder how Hitler managed to pay for the 6.5m soldiers and all the ships, tanks, aircraft, submarines etc he needed to kick WW2 off in 1939 - especially with Jerry having been so completely skint following WW1 and the world wide depression of the 20's.

    Scratching around on the web it seems he managed it much like the Yanks worked their way out of the Depression - by embarking on a huge programme of public works but making it all relevant to the forces.

    This is described as 'military keynesianism' and seems to have worked wonders for a while.

    But with such a monstrous military bias in the economy it seems it was back in the crapper by 1939.

    Hitler oversaw the average worker's pay by drop by 25 per cent, introduced monopoly price fixing and outlawed Trades Unions, banned strikes and even the 'right to quit' by introducing Labour Books whereby a worker could only move to a new job if he had the signed permission of the old boss to leave in the first place.

    There is no doubt they were intent on war at some point, but it seems there are two schools of thought as to why it happened when it did.

    One is that the upcoming meltdown of the Nazi economy, ie the banks, prompted the 'flight into war', and thus it was economics in the end that dictated H-Hour, and not politics.

    The other seems to be that Hitler basically thought economics was something that Jews worried about whereas it was a mere detail for the master race and so went ahead and did everything in his own time - ie that it was politics that dictated the start.

    So I wonder what the brains trust think?

    Did economics push him into an early kick-off or did it all begin bang on time according to his long term vision?
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  2. Not actually got around to reading it myself but my friend claims Wages of Destruction is supposed to be a very good study of the Nazi economy and how the German economy would have imploded by the mid 1940s at the latest due to its unsustainablity. Not sure how much of a factor this played in pushing Germany toward rabid expansion by war and intimidation when weighed up against Hitler's own ideological desire for conquest. Didn't he rant about Chamberlain for being a worm and depriving him of 'his war' at Munich in 1938?
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  3. Easier to say he looked at France USA & GB, weighed up their their appeasment policy, then snatched what he could.

    Not all the reparations were paid off, some were waived aside.

    Luftwaffe + Whermacht were scaled up for a quick fight, a lot of Czech equipment resurfaced in the hands of them both.
  4. Nope, it was wanting back the bits of Germany that they lost after WW1, mainly in Poland but also the mineral rich area of Alsace-Lorraine (bordering France).
  5. To his credit he probably didn't give billions in foriegn aid.
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  6. He was a clever bloke, until he went mad. Roads that were straight and long, gliders you could drop an engine into.
  7. Wordsmith

    Wordsmith LE Book Reviewer

    Interesting question - and the answer is Hjalmar Schacht.

    Hjalmar Schacht - Wikipedia, the free encyclopedia

    Schacht was a financial genius who used his knowledge of international finance to finance German rearmament. In particular he used Mefo bills.

    MEFO - Wikipedia, the free encyclopedia

    Mefo bills were essentially a German government IOU that would be redeemed by the Reichsbank - think of them as the Quantitative Easing of the day. They enabled Germany to rearm without the need to borrow money on the open markets. Financial trickery of the first order...

    Schacht was an interesting character. He appears to have helped German rearmament out of patriotism - he felt it would help Germany regain her rightful place in the world. But he took fright when he realised that Germany was heading for war. Hitler eventually threw him into a concentration camp. After the war, Schacht was put on trial at Nuremberg - which he found ironic as his former jailer - Kaltenbrunner - was on trial at the same time.

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  8. damn beaten to it !! Schacht was a Genius, Hitlers banker. Also, Hitler managed to get the German worker onside as well as the German industrialists... it was in German industries best interest to break Versailles, whether your business was steel (Thyssen) big guns (Krupp) dyestuffs and chemicals (IG Farben et al etc..) encompassed by the 4 year plan under Goering.. who would collect donations from all particularly in the early days to get the nazis elected.

    also, Hitler would not have brooked any bank trading just for its own profit.. as he would consider this form of capitalism as "jewish robbery" basicly the bank would have to invest in a concrete business to materially further the Reich, and thus keep german workers producing....no, I wont comment further.
  9. chrisg46

    chrisg46 LE Book Reviewer

    Might be a bit simplistic, but another thing you have to remember is that military kit was a LOT cheaper in them days! I think someone said that for the equivalent cost of a modern F15 fighter, you could maintain a squadron of Spitfires!
  10. Ture but he did seem to be intent on re-equipping the Kuomintang, I believe he though that China would become a significant industrial base and he wanted in. Seems to have predated the rest of the world by around 50 years or so.
  11. I heard the same theory about the USSR in the mid-70s from an IO. The USSR was investing an unsustainable amount of their GDP (33%, 50% ?) in tanks, subs and aircraft when they could put the money in a bank and get a 10% (?) return. They would be obliged to use said tanks, subs, etc., for the purpose they were designed for before they became obsolete or the money was wasted. The Soviets weren't stupid and weren't intent on wasting money, so we could expect them to be heading westwards shortly.

    Hiltler's plans were laid out in Mein Kampf (I believe, haven't read it).

    " In Mein Kampf Hitler openly states that the future of Germany "has to lie in the acquisition of land in the East at the expense of Russia." ".

    His plan involved an alliance with the British Empire and the destruction of the "Judeo-Bolshevik" regime in the USSR. The re-armament programme had this as its final goal. The financiers and banks would/should have known what they were investing in.
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  12. Answering this decently would need a masters level essay atleast, the whole thing is a module in itself. Best reading on it from recent times is Richard Evans 'The Third Reich in Power' to get a really good picture of it. Whole German economic recovery was based on rearmament and motivation of the population, eg strength through joy projects and autobahns in order to gain the 'living space' for a greater Germany. Nazi's and the big business/banks were generally always suspicious of one another and not in eachothers pocket.
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  13. Mefo bills were essentially a German government IOU that would be redeemed by the Reichsbank - think of them as the Quantitative Easing of the day. They enabled Germany to rearm without the need to borrow money on the open markets. Financial trickery of the first order.

    So, having read the link, they wrote a series of these Mefo IOUs to the tune of 12bn r-marks to their own military suppliers and they began to fall due in 1939.

    A huge sum of money which would wreck the economy if paid, but which would bankrupt their arms suppliers if defaulted upon.

    Is it a coincidence that he went to war in the same year?

    It's obvious he was planning a war at some stage, but I was wondering if it was economics rather than military strategy that eventually set the timetable.

    Perhaps the Mefo chickens coming home to roost may have left him no choice in 1939?
  14. That is not strictly true. The Nazis were quite keen on solving problems currently tackled by foreign aid.

    Some of Germany's finest scientists and artists were encouraged to work abroad.

    They had an interventionist approach to agricultural reform in Eastern Europe and threw hundreds of thousnads of volunteerrs into the Ukraine and Russia.

    There was a Korps for Afrika.

    They did have a solution to over population.

    But those are the policies one might expect from a vegetarian animal lover.
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  15. Wordsmith

    Wordsmith LE Book Reviewer

    Historians are divided about whether Hitler was opportunistic or working to a strategy. (I think he swapped from one to the other as circumstances dictated).

    You might be interested in the Kreigsmarine's Z plan.


    This was a strategy to build up a surface fleet that would rival the Royal Navy. It was scheduled to run from 1939 - 1946. The German navy was totally unprepared for war in 1939 - expecting war to come considerably later. The plan was also totally unrealistic in light of Germany's actual industrial capacity of the time.