Economy of Nazi Germany

Economy Of Nazi Germany

World War I and the subsequent Treaty of Versailles with its severe reparations imposed on Germany led to a decade of economic woes, including hyperinflation in the mid-1920s. Following the Wall Street Crash of 1929, the German economy, like those of many other western nations, suffered the effects of the Great Depression, with unemployment soaring. When Hitler became Chancellor in 1933, he introduced new efforts to improve Germany's economy, including autarky – discouraging most trade with other nations and emphasizing economic self-sufficiency – and a radical extension of the Autobahn system founded in the late years of the Weimar Republic.

This system had also been attempted in America with little success. In Nazi Germany, however, it appears the system was more successful. By 1938, unemployment was practically extinct and Germany even lacked enough workers to fill the available jobs. However, this dramatic fall in unemployment levels was not all due to the creation of new jobs. Many Jews and women were forced out of their jobs and this made way for unemployed German men to take their place. However the women and Jews who had lost their jobs were not counted on the unemployment register. The Nazis considered Jews an inferior race and believed that women should stay at home, so neither of these groups contributed to unemployment statistics. Furthermore, the spending rate of Hitler was far greater than the growth of the economy. In 1934 Hjalmar Schacht, the Reich Minister of Economics, introduced the Mefo bills, allowing Hitler to spend money on rearming without giving the big businesses money, thereby gradually getting Germany into more and more debt. Between 1933 and 1939, the total revenue was 62 billion marks, whereas expenditure (at times made up to 60% by rearmament costs) exceeded 101 billion, thus creating a huge deficit and national debt (reaching 38 billion mark in 1939) coinciding with the Kristallnacht and intensified persecutions of Jews and the outbreak of the war.