National Socialism and the German Economic Miracle

UnemployedBeforeWW2

Time to get REAL folks!

Hitler’s economic miracle
The Nazis came to power in Germany in 1933, at a time when its economy was in total collapse, with ruinous war-reparation obligations and zero prospects for foreign investment or credit. Yet through an independent monetary policy of sovereign credit and a full-employment public-works program, the Third Reich was able to turn a bankrupt Germany, stripped of overseas colonies it could exploit, into the strongest economy in Europe within four years, even before armament spending began. In fact, German economic recovery preceded and later enabled German rearmament, in contrast to the US economy, where constitutional roadblocks placed by the US Supreme Court on the New Deal delayed economic recovery until US entry to World War II put the US market economy on a war footing. While this observation is not an endorsement for Nazi philosophy, the effectiveness of German economic policy in this period, some of which had been started during the last phase of the Weimar Republic, is undeniable.

There were major differences between the German situation in 1933 and that in 1945. Not having been a battlefield in World War I, Germany in 1933 was not physically in ruins, as it was in 1945. What lay in ruins was its political and economic institutions. But in 1933, Germany not only did not have the benefit of the Marshall Plan, it was saddled with ruinous war reparations and an inoperative credit rating. What Germany had in 1933 was full sovereignty through which the Third Reich was able to adopt policies of economic nationalism to full effectiveness. In 1945, Germany was deprived of sovereign power and national policies had to be adjusted to comply with US and Soviet geopolitical intentions. Economically, the dependence on foreign investments and credit forced West Germany into an export economy at the mercy of its main market: the United States.

After two and a half decades of economic reform toward neo-liberal market economy, China is still unable to accomplish in economic reconstruction what Nazi Germany managed in four years after coming to power, ie, full employment with a vibrant economy financed with sovereign credit without the need to export, which would challenge that of Britain, the then Superpower. This is because China made the mistake of relying on foreign investment instead of using its own sovereign credit. The penalty for China is that it has to export the resultant wealth to pay for the foreign capital it did not need in the first place. The result after more than two decades is that while China has become a creditor to the US to the tune of nearing China’s own gross domestic product (GDP), it continues to have to beg the US for investment capital.

The period between World Wars I and II, like no other period in modern European economic history, saw the success of centrally planned economies in Germany and the Soviet Union, two major states. The United States as the dominant victor of World War II was determined to perpetuate its hegemony by suppressing national planning everywhere to prevent the emergence of economic nationalism and socialism. It promoted global market capitalism and neo-liberal free trade to keep all other economies subservient to the US economy. It is the economic basis of the Pax Americana.

Stalin’s New Economic Policy
In the Soviet Union, Josef Stalin’s planned economy had followed the New Economic Policy (NEP) of 1921-28. NEP was, in essence, a mixed market economy; the main part of the market was in state possession (banks, industries, foreign trade, etc), while the peripheral part was owned by collective or private entrepreneurs. NEP, while successful, did not give the Soviet economy sufficient growth in the capital-goods sectors (ie coal, steel and electricity, transportation, heavy industry, etc), nor did it provide adequate food for the urban population even as the middle peasantry managed to feed itself. To overcome such structural obstacles and to combat general economic backwardness inherited from centuries of Czarist rule, Stalin introduced central planning as a strategy of national survival.

Starting from 1928, the Soviet economy was put under a system of planning whereby all modes of production were socialized and foreign trade was de-emphasized in favor of an autarkic system of domestic demand and supply. The irony was that Soviet central planning adopted much of its effective techniques from successful US experience. It was a system of planning focused solely on unit end-results while externalizing social costs. The key distinction was that the Soviets rejected and bypassed the corporate structure and replaced shareholders with state ownership. Stalin brought about “revolution from above”. Its main features were: strengthening of political dictatorship in the name of the proletariat (equivalent to enhancing management authority in the US in the name of shareholders), collectivizing kulak peasants (equivalent to agri-business development in the US), emergency measure authority (equivalent to government bailouts and regulations in the US), introduction of a five-year plan structure (adopted from US corporate strategic planning) and rapid expansion of urban labor force (equivalent to urbanization in the US), and tight state control over agriculture (equivalent to farm subsidy programs in the US), heavy industry (equivalent to defense contracts in the US) and finance (equivalent to central banking in the US). Between 1934 and 1936 the Soviet economy achieved a spectacular economic growth rate that continued despite political purges of Trotskyites between 1936 and 1938. Economic growth was unfortunately interrupted by war in 1941. The German invasion of the Union of Soviet Socialist Republics was not independent of apprehension of continued Soviet economic success.

Propaganda works. It worked in the USSR, in Nazi Germany, in imperial Japan, and in the capitalist US, each to instill in the general public an acceptance of its system as being the suitable one if not the best, despite visible shortcomings. It helped achieve optimal effectiveness and stability in the overall economy in all these countries.

Nazi Germany provided another example of successful inter-war economic planning. One of the main differences between the Nazi and the Soviet economic systems was that the Nazis’ was a mixed economy with strict state control while the Soviets’ was a state-owned economy. Furthermore, being heavily influenced by the ideas of Walter Rathenau (1867-1922), German economic planners did not seek to build anew with revolutionary zeal as the Russians did, but rather to reform, molding the existing form of decentralized capitalism into a more effective centralized system with massive combines to support national aims.

The Rathenau factor
Rathenau, German industrialist, social theorist, and statesman, was the son of Emil Rathenau (1838-1915), founder of the gigantic German public utility company Allgemeine Elektrizitaetsgesellschaft (AEG). He directed the distribution of raw materials in World War I and became minister of reconstruction (1921) and later foreign minister (1922) of the Weimar Republic. He represented Germany at the Cannes and Genoa reparations conferences and negotiated the Treaty of Rapallo in which Germany accorded the USSR de jure recognition, the first such recognition extended to the new Soviet government. The two signatories mutually canceled all prewar and war debts and renounced war claims. Particularly advantageous to Germany was the inclusion of a most-favored-nation clause and of extensive free-trade agreements. The treaty enabled the German army, through secret agreements, to produce and perfect in the USSR weapons forbidden by the Treaty of Versailles. A Jew, Rathenau was assassinated in 1922 by anti-Semitic nationalist fanatics who opposed his attempts to fulfill war-reparation obligations to the Western victors. A strong nationalist who played an important role in Germany’s war efforts in World War I, Rathenau was also a strong proponent of postwar international cooperation and his diplomatic initiatives played a key role in breaking Germany’s postwar diplomatic isolation.

In his writings, Rathenau criticized free-market capitalism and argued that technological change and industrialization were pushing civilization toward a stage of high mechanization, in which the human soul would be under threat. In an attempt to find an alternative to laissez-faire capitalism that did not involve state socialism and Marxism, Rathenau proposed a decentralized, democratic social order, in which the workers would have more control over production and the state would exert more control over the economy. His translated works include In Days to Come(1921) and The New Society (1921). Despite his great contribution to the German economy, Rathenau epitomized the living target of Adolf Hitler’s accusation of internationalist Jewish treachery that betrayed the German nation.

Hitler’s rejection of the loyal nationalist support of the German Jews played an undeniable role in his own defeat. Jewish contribution to the flowering of the German economy, culture, and civilization had been the strongest in any European nation. Nazi persecution of the Jews was a strategic error more fundamental than the Nazi invasion of the USSR. The emigration of German Jews to the West, particularly to the US, played a critical role in the defeat of Germany in World War II. It is a lesson that the Arab nation in general, and Palestinians in particular, have yet to learn.

The economic power of full employment
From the very outset of his rule, Hitler, whose main short-term goal was the economic revival of Germany with the help of German nationalist bankers and industrialists, won popular support of the nation. Hitler adopted an aggressive full-employment campaign. Between January 1933 and July 1935 the number of employed Germans rose by a half, from 11.7 million to 16.9 million. More than 5 million new jobs paying living wages were created.

Unemployment was banished from the German economy and the entire nation was productively engaged in reconstruction. Inflation was brought under control by wage freeze and price control. Besides this, taking into account the lessons learned during 1914-18, Hitler aimed at creating an economy that would be independent of foreign capital and supply, and be well protected from another blockade and economic war. For Germans, all of the above was proof that Hitler was the one who had not only brought Germany out of economic depression but would take it directly to prosperity with new pride. German popular trust in the Fuehrer rose dramatically.

In September 1936, British economist John Maynard Keynes, whose ideas had been credited as behind US president Franklin Roosevelt’s New Deal, prepared a preface for the German translation of his book, The General Theory of Employment, Interest, and Money. Addressing a readership of German economists, Keynes wrote: “The theory of aggregate production, which is the point of the following book, nevertheless can be much easier adapted to the conditions of a totalitarian state, than … under conditions of free competition and a large degree of laissez-faire. This is one of the reasons that [justify] the fact that I call my theory a general theory. Although I have, after all, worked it out with a view to the conditions prevailing in the Anglo-Saxon countries where a large degree of laissez-faire still prevails, nevertheless it remains applicable to situations in which state management is more pronounced.” Keynes clearly understood that the greater the degree of state control over any economy, the easier it would be for the government to manage the levers of monetary and fiscal policy to manipulate macroeconomic aggregates of total output, total employment, and the general price and wage levels for purposes of moving the overall economy into directions more to the economic-policy analyst’s liking.

The radical Spartacists in Germany regrouped themselves as the Communist Party in 1920. They continued their opposition to the liberal government of the Weimar Republic. From 1923-29, the Communists always obtained about 10% of the seats in the Reichstag. Unlike elitist Italian Fascism, Nazism had a high regard for the German peasant. Unlike Fascist Italy, Nazi Germany, while imposing sweeping government control over all aspects of the economy, was not a corporate state.

In four short years, Hitler’s Germany was able to turn a Germany ravaged by defeat in war and left in a state national malaise by the liberal policies of the Weimar Republic, with a bankrupt economy weighted down by heavy foreign war debt and the total unavailability of new foreign capital, into the strongest economy and military power in Europe.

How did Germany do it? The centerpiece was Germany’s Work Creation Program of 1933-36, which preceded its rearmament program. Neo-liberal economists everywhere seven decades later have yet to acknowledge that employment is all that counts and living wages are the key to national prosperity. Any economic policy that does not lead to full employment is self-deceivingly counterproductive, and any policy that permits international wage arbitrage is treasonous. German economic policies between 1930 and 1932 were brutally deflationary, which showed total indifference to high unemployment, and in 1933 Hitler was elected chancellor out of the socio-economic chaos.

The financing of Nazi economic-recovery programs drew upon sovereign credit creation techniques already experimented prior to Hitler’s appointment as chancellor. What changed after 1933 was the government’s willingness to create massive short-term sovereign credit and its firm commitment to retire in full the debt created by that credit. Short-term sovereign credit was important to change the general climate of distrust on government credit. The quick rollover of short-term government notes created popular trust within months in German sovereign credit domestically.

Hitler told German industrialists in May 1933 that economic recovery required action by both the state and the private sector. The government’s role was limited to encouraging private-sector investment, mainly through tax incentives. He expressed willingness to provide substantial public funding only for highway projects, not for industry. An investment was unlikely if consumers had no money to spend or were afraid because of job insecurity to spend money to buy products produced, and Hitler understood that workers needed a decent income to become healthy consumers. Thus full employment was the kick-start point of the economic cycle. To combat traditional German fear of the social consequences of appearing better off than their neighbors, Nazi propaganda would psychologically stimulate the economy by developing a lust for life among consumers.

Hitler stressed on May 31, 1933, that the Reich budget must be balanced. A balanced budget meant reducing expenditures on social programs because Hitler intended to reduce business taxes to promote needed private investment. To avoid reducing social programs, a large work program without deficit spending had to be financed outside of the Reich budget. Hitler resorted to “pre-financing” (Vorfinanzierung) by means of “work-creation bills” (Arbeitsbeschaffungswechseln), a classic response of using monetary measures to deal with a fiscal dilemma.

Under the scheme of “pre-financing” with work-creation bills, the Reich Finance Ministry distributed these WCBs (three months, renewable up to five years) to participating credit institutions and public agencies. Contractors and suppliers who required cash to participate in work-creation projects drew bills against the agency ordering the work or the appropriate credit institutions. These credit institutions then accepted (assumed liability for payment of) the bills, which, now treated as commercial paper, could rediscount the bills at the Reichsbank (central bank). The entire process of drawing, accepting and discounting WCBs provided the cash necessary to pay the contractors and suppliers. The experience of successful rollover every three months quickly established creditworthiness. The Reich Treasury undertook to redeem these bills, one-fifth of the total every year, between 1934 and 1938, as the economy and tax receipts recovered. As security for the bills, the Reich Treasury deposited with the credit institutions a corresponding amount of tax vouchers (Steuergutscheine) or other securities. As the Treasury redeemed WCBs, the tax vouchers were to be returned to the Treasury. Hitler increased the money supply in the German economy by creating special money for employment. 

In the US Banking Panic of 1907, J P Morgan (1837-1913) did, in essence, the same thing. He strong-armed US banks to agree to settle accounts among themselves with clearinghouse certificates he issued rather than cash and thus illegally increased the money supply without involving the government, and ended up owning a much larger share of the financial sector paid for with his own paper, ironically with the gratitude of the government. The difference was that the economic benefit went to Morgan personally rather than to the nation as in Nazi Germany and the private money was used to save the banks rather than to save the unemployed.

Nazi economic experts understood that sovereign credit creation for purposes of job creation posed no inflationary threat and that it would be a far more responsible policy than the conservative approach of tax increases and welfare cuts to balance government budgets. The idiotic policy of monetary restraint and social-spending reduction to balance government budgets in order to pay foreign debts is still being advocated by the International Monetary Fund (IMF) in debtor nations around the world – except for the United States, the world’s largest debtor nation, which uses dollar hegemony as an escape hatch or, more to the point, escape hedge. Redeeming WCBs did burden the 1934-39 Reich budget, but the decline in Reich expenditure for welfare support and other tax subsidies as a result of full employment recovery more than offset the redemption payments. The surplus was then used to reduce public debt and taxes further.

There were legal, political and institutional restrictions unique to Germany on the scope of the Reichsbank that virtually dictated resources to WCBs as a way of putting 6 million unemployed Germans back to work. But the principle of WCBs can be applied to the US or China or any other country today to combat unacceptably high levels of unemployment. Alas, this common-sense approach is faced with firm opposition rationalized by obscure theories of inflation in most countries. The real reason is that the banking sector can reap excess profit by treating high unemployment as an externality in the economy that translates high unemployment and low wages directly into corporate profits. The profit from high unemployment is kept in private hands, while the cost of high unemployment is socialized as government expenditure.

In 1933, Hitler sought to reassure Germany’s business leaders that Nazi rule was consistent with the preservation of the free-market system because he needed the support of the industrialists. He could buy that support by keeping wages down during the recovery, but any rigorous effort to curb prices and profits would alienate the business community and slow down the economic recovery. Instead, Hitler sought to restore profitability to German business through reduced unit cost achieved by increasing output and sales volume, rather than through a general increase in prices (Mengenkonjunktur, niche Preiskonjunktur – output boom, not price boom). Adoption of “performance wage” (Leistungslohn – payment on a price-rate basis) increased labor productivity, thereby driving costs down and profit up. Some upward price movements were permitted to adjust price relationships between agricultural and manufactured products and between goods with elastic and inelastic demands, also to prevent price wars and below-cost dumping. These principles of “output boom, not price boom” and “performance wage” could also work in combating inflation today in many economies generally and China specifically.

Hitler saved the German farmers from their heavy debt burden through relief programs and through subsidized farm prices. The stable farm income came at the expenses of the middlemen institutions, but Hitler sustained popular support by the provision of living income to consumers. Had Nazi Germany been a member of the World Trade Organization (WTO), this option would have been foreclosed to it. Hitler sought price stability only in sectors critical to the national economy and to the ultimate goal of rearmament. Germany had no overall price policy until the 1936 Four Year Plan, which concentrated economic authority in the hands of Hermann Goering for war production and put an end to regulated free-market policies.

Business managers generally make investment and employment decisions based on their judgment of the prospect for new orders. The difference between German economic recovery under Hitler and US economic stagnation under Roosevelt in the 1930s was the degree of uncertainty for new orders for goods. Hitler made it clear that after 1936, a major rearmament program would make a heavy demand on German durable-goods and capital-goods industries without the need to export. With that assurance, German industry could plan expansion with confidence. Roosevelt was unable to provide such “confidence” to industry and had to rely on anemic market forces until after the Japanese attack on Pearl Harbor, Hawaii.

“CHURCHILL’S DECEPTION”

According to Kilzer’s well-documented book, Hitler was trying to convince the English to make peace. In exchange, he was ready to retreat from Western Europe and from much of Poland. Kilzer describes how British Intelligence (an arm of the Illuminati) took advantage of Hitler’s racist ideology to divert his energies against Russia and trap him in a two-front war. They convinced him that a large pro Nazi (anti Communist) “Peace Party” was prepared to unseat the “war monger” Churchill.

This party consisted of the Duke of Windsor (the former King Edward VIII) and appeasement-minded elitists known as the “Cliveden Set.” The Nazis had longstanding social ties with this group and confided in them. Hitler seemed to overlook the fact that Windsor went to stay at the Rothschild castle in Austria after he abdicated.Rudolph Hess, the Deputy Leader of Nazi Germany, was in contact with the Cliveden group and flew to England May 10, 1941, to negotiate peace. According to Kilzer, Hess had Hitler’s complete blessings. Coincidentally this was the worst night of the Blitz.

Afterward, there was a long lull in both Nazi and British bombing raids. It appears the Nazis thought they had an understanding with the British and turned their attention to the invasion of Russia the following month (June 22, 1941.)Hitler didn’t understand that the Anglo American elite was (and still is) intimately connected with international (i.e. Rothschild) finance.

Anglo American imperialism is, in fact, a front for the families that own the Bank of England and the Federal Reserve. These Jewish and non-Jewish families are connected by money, marriage and Lucifer worship (i.e. Freemasonry). Both Roosevelt and Churchill were their flunkies. (All our “leaders” are.) In 1776 Meyer Rothschild financed the Illuminati, a Masonic secret society that in turn spawned the major revolutions of the modern era including the Bolshevik Revolution in 1917. The ultimate aim is to establish the banker world dictatorship, which is at an advanced stage today. In the 1930’s their purpose was to incite a two-front war that would leave the great nation states (England, Germany, and Russia) prostrate.

Like all wars, the purpose was to kill millions of people, traumatize humanity, increase public debt and private profit, and make “world government” (the future UN) seem essential for “peace.” The 1930’s British Policy of Appeasement was probably designed to encourage Hitler’s expansionist tendencies and to provoke war. Douglas Reed, the (London) Times Correspondent in Berlin, was first tipped off to something fishy when his newspaper suppressed his warnings of the Hitler menace.

ROTHSCHILD CONDUCTS RED SYMPHONY

Why would the financial elite also want to destroy Russia, which they created? The transcript of the 1938 NKVD interrogation of C.G. Rakowsky (a.k.a Chaim Rakeover) provides the answer.

(http://www.savethemales.ca/000275.html) Rakowsky was an intimate of Trotsky’s and former Soviet ambassador to Paris. Rothschild’s agent Leon Trotsky was supposed to succeed Lenin but got sick at the critical moment. Stalin was able to assume power and save Russia from Rothschild control. In order to control Stalin, international finance was forced to build up Hitler and the Nazi party.

Rakowsky confirms that Jewish financiers backed the Nazis although Hitler was not aware of this. “The ambassador Warburg presented himself under a false name and Hitler did not even guess his race… he also lied regarding whose representative he was… Our aim was to provoke a war and Hitler was war…[the Nazis] received…millions of dollars sent to it from Wall Street, and millions of Marks from German financiers through Schacht; [providing] the upkeep of the S.A and the S.S. and also the financing of the elections…” Unfortunately for the bankers, Hitler also proved intractable. He started to print his own money! “He took over for himself the privilege of manufacturing money and not only physical money but also financial ones; he took over the untouched machinery of falsification and put it to work for the benefit of the state… Are you capable of imagining what would have come …if it had infected a number of other states and brought about the creation of a period of autarchy [absolute rule, replacing that of the bankers]?

If you can, then imagine its counterrevolutionary functions…” Hitler had become a bigger threat than Stalin, who had not meddled with money. The British were not going to make peace with Hitler because he threatened the bankers’ racket. Furthermore, the Illuminati wanted an extended war, the ruin of Europe and the expansion of the USSR.HITLER’S SECRET BACKERS

The book “Financial Origins of National Socialism” (1933) by “Sydney Warburg” provides another glimpse of how the Illuminist clique supported Hitler. This 70-page booklet was suppressed for many years but was republished in 1983 as “Hitler’s Secret Backers.” “Warburg” describes a July 1929 meeting with “Carter,” the President of J.P. Morgan’s Guarantee Trust, the Presidents of the Federal Reserve Banks, “the young Rockefeller” and “Glean from Royal Dutch.”

These are all Rothschild dominated. It was determined that Warburg who spoke German should ask Hitler how much money he needed to overthrow the state. The only stipulation was that Hitler adopts “an aggressive foreign policy.” “Warburg” details five meetings with Hitler between 1929 and 1933. The first took place in a beer cellar where Hitler calculated his needs on the back of a paper plate.

About $25 million was transferred. This was extremely important in the depth of the depression because the Nazis provided food and shelter to many of their supporters.

Hitler wasn’t told the reason for this support and did not ask. On two occasions, he wondered out loud if “Warburg” was himself Jewish but dismissed the idea before getting a reply.There is no “Sydney Warburg” but the internal evidence suggests the author could be James Warburg, son of Federal Reserve founder Paul Warburg. Many people dismiss this monograph as yet another fraud but the wealth of accurate detail and anecdote suggests otherwise. One wonders why anyone would go to this much trouble to alienate the most powerful people in the world if he wasn’t sincere. The only people with the power to suppress it are the ones it incriminates and they have a long record of suppressing similar works.

One other thing I might mention…
Hitler Arrests Rothschild (1)

Well, well, well!!!! Now we begin to understand The Truth about why history had to be completely re-written and why it has been necessary for the wanna-be controllers of the world to demonize Hitler.

CONCLUSION “Who controls the past controls the future: who controls the present controls the past.” George Orwell

Quick Video Theme to end this

Please share this Worldwide from the links below!

Comments

comments

One thought on “National Socialism and the German Economic Miracle”

Leave a Reply