Op-Ed: German Economics in the 1930's, a history lesson with Kate

By Captain_Plat_2258

Recently, an article was released criticising the Labour Party for multiple past occurances and policies related to the party - defending the party of the person who wrote the article against criticism that many of its policies and statements represented far-right thinking that could be potentially harmful to racial minorities. This is a topic I happen to currently be writing a paper on outside of my political work with the Labour Party, in an academic capacity, so I’d like to share some of my objective findings and personal opinions with the British public - and with the man who wrote the article.

In his article, the Leader of the LPUK makes a few rather bold claims about Labour’s economic policies. In one section of his article he says “The Labour Party, by allowing these views to be published, are showing nothing but outright disrespect to those who suffered under ‘facist’ (spelling error comes free) regimes” and in another section states “according to Redwolf, apparently questioning the costing of (...) over 30 billion pounds of taxpayer money going towards (a child care program) makes you comparable to Hitler and the Nazis (let’s not forget that the so called ‘far-right’ have more policy in common with Labour than they ever would with me and my party)” end quote.

Now this is part of a common misconception perpetuated by such political pundits as Dinesh D’Souza, who made the film Death of a Nation where he explored this same claim. Important to note is the fact that the same man was arrested in connection with making illegal campaign contributions ‘in the name of others’ to republican senate runs, alongside with multiple counts of fraud, in 2014 - and was exonerated by the current President, a republican, in 2018. But let’s ignore for a moment the kind of people that make these claims, let’s actually explore the claim. Was the Nazi Regime an economically left-wing state? Are the policies of the right-wing really close to the Labour Party? Well, let’s take an in-depth look at the economic policies of the German Third Reich.

In 1933, Hitler was appointed to the Chancellery. Shortly after he made a personal appeal to German business leaders to help fund the Nazi Party as the country headed into a period of various elections. He argued that they should support the Nazi Party in seizing full power and establishing dictatorship, with the reasoning that ‘private enterprise cannot be maintained in the age of democracy’ and that ‘democracy will eventually lead to communism’ (Adam Tooze ‘Wages of Destruction: The Making and Breaking of the Nazi Economy’).

Adam Tooze writes that leaders of the German economy were ‘willing partners in the destruction of political pluralism’, citing that many of the largest businesses in Germany (Krupp and IG Farben particularly, along with multiple large car manufacturers) directly contributed massive funds to the party before and after it seized full power. In exchange for supporting the Nazi Party via political funding, the owners and managers of German businesses were allowed unprecendented powers to control their workforce - with trade unionism and workplace bargaining completely abolished and a cap being placed on the minimum wage, past which it was not allowed to rise. Businesses profited massively from this, and corporate investment was booming at the height of the Nazis power before WWII broke out.

After the Great Depression, the Weimar Republic increased public ownership throughout the country - very much in line with modern day social democrat and democratic socialist policy. However the Nazis upon taking power began privatising en-masse. Banks, shipyards, railways, welfare organisations, and much more. The Nazi Party was of the opinion that all enterprises that can be private, should be (Germa Bel ‘Against the Mainstream: Nazi Privatisation in 1930’s Germany’). The Nazis believed that by allowing private companies to exist and giving them undue power, they could bribe these companies into supporting the regime, while a number of members of the Nazi Party made profits by owning small shares of these companies. They were right of course.

Companies privatised by the Nazi regime included the Commerz-Und Privatbank, Deutsche Bank und Disconto-Gesellschaft, Golddiskontbank, and Dresdner Bank - the four main commercial banks of the country. They also privatised the Deutsche Reichsbahn (Germany Railway) which was the largest publicly-owned company in the world at the time. They also sold shipping companies, municipal utility companies, and multiple welfare services - which were then taken over by organisations affiliated with the Nazi Regime that would ensure no money went to ‘vulnerable and weak people’. The Nazi regime was actually the single only country at the time to pass social services over to private hands.

The Nazi Regime even offered millions in credits and tax-breaks to private businesses, and Hitler implimented a policy of abolishing enterprises with capital less than $200,000 in 1937, allowing the German economy to enter a kind of late-stage state-encouraged corporatism with complete monopolies of large corporate bodies (William L. Shirer, ‘The Rise and Fall of the Third Reich: A History of Nazi Germany’). Hitler advocated for this privatisation and corporate monopolisation using ‘social darwinist’ arguments towards this ideal, stating that the German people should worry about ‘bureaucratic management of the economy’ that would ‘preserve the weak’ and ‘represent a burden to those with higher ability, to industry, and to value’ - an appeal made as a dog-whistle against the disabled, people of colour, gender-diverse people, same-sex attracted people, and most obviously Jewish people (Christoph Buchheim and Jonas Scherner ‘The Role of Private Property in the Nazi Economy: The Case of Industry’).

The Nazi Leadership held entrepreneurship in high regard, stating that ‘private property is a precondition to developing the creativity of members of the German race in the best interest of the people’. During the time of the Regime, these private companies were bribed by the government with aforementioned profits. Instead of taking legal control of the industrial sector, as many seem to believe he did, Hitler instead bribed the sector with money so that they would keep him in power and keep his economy running exactly how he wanted. Because Hitler and his fellow Nazis owned stocks in these companies, it would directly benefit him either way.

Far less often was there a threat of violence to encourage these companies to support the Regime, the Nazi Leadership generally respected the freedom of contract for these corporations and instead preferred to provide incentives. According to the authors of The Case of Industry, the only cases in which businesses refused these incentives were usually out of long-term profit considerations in the case of war. Outside of this, the private sector willingly and happily aided the rise of the Nazi Regime because it would turn them a profit - and yet these corporations that aided the German economic machine ‘could normally refuse to engage in investment projects designed by the state without any consequences’. Many businessmen even had friendly relations with the Nazi Leadership, particularly obvious in Heinrich Himmler’s ‘Circle of Friends of the German Economy’ - a non-governmental organisation of CEOs that were loyal to Himmler (Jonathan Wiesen ‘German Industry and the Third Reich’).

So what does this all tell us? Well, the Nazis valued the market a lot. While not running an exactly ‘free capitalist’ system - they gave massive amounts of power to corporations while stripping back workers protections and rights. They froze the minimum wage, they privatised nearly the entire public sector and made a profit off of it, they abolished trade unions, they allowed corporate interests to monopolise the economy. Does any of this sound particularly Labour to you?

The Nazis were not socialists. They weren’t even social democrats. They weren’t even centrists. The name ‘National Socialist German Workers Party’ was intentionally misleading, and many pieces of political satire from the time show this (‘The Sign’ by Jacobus Belsen in 1931 showed in a satirical way how when talking to businessmen and workers, Hitler would place emphasis on different parts of the Party’s name to appeal to the different demographics). In reality, the Nazi Party was about as Socialist as the Democratic People’s Republic of (North) Korea is Democratic. The naming was an intentional misnomer to trick the German workers into voting them into the Reichstag (Parliament) along with their anti-immigrant rhetoric (they had a mass-deportation policy for everyone who had immigrated to Germany since 1925 and advocated a freeze on new immigration of people who were ‘not of the pure German race’, a policy that would eventually sow the seeds for their concentration camp construction) and their advocacy for ‘a homeland for the white race’. As soon as they got into power they showed their true colours by systematically eliminating every right that the German worker had - aryan or otherwise.

So this is an appeal to you, the public, and to Friedmanite. Do not be tricked by old Nazi propaganda. Don’t use a tragic regime for political points. There is more nuance to history than ‘the nazis were socialist because it’s in the name’. The Nazi Party was a fascist party of economic centralisation and privatisation - led by a man that labelled the rise of communism as ‘a Jewish plot to overthrow Western Civilization’ in his autobiography. The Labour Party opposes literally every aspect of them, and many members of our party who would have been on the list of those put to work and then killed under the Nazi Regime. These members, myself included, and the Labour Party as a whole absolutely reject the idea that we are in any way comparable to the party that used corporatism, anti-immigrant sentiments, ableism, anti-LGBT+, and racist sentiment to start the single most awful regime in modern human history.

Friedmanite apologised for the wording used, but I wrote this article to not just address a particular set of unfortunate phrasing but also to address a fundamental misinterpretation of history too common amongst the Libertarian and Conservative parties when it comes to fascism and fascist regimes. History is important, the way we understand it and tell it shapes the actions we take moving forward. Left wing or right we must not deliberately or accidentally misinterpret our past. Not now, not ever. We must say when we look back on those dark pieces of history, collectively; never again.