4 - Government and recovery

Summary

The German economic recovery was an example of state-led growth in what was still ostensibly a capitalist economy. This is not to suggest that recovery could only occur under state direction. Some level of recovery would have been achieved without state help. But the characteristic features of the revival – the control of trade, the intervention in the capital market, high levels of investment and a rapid return to full employment – were dictated by the strategies of the regime, not the pressures of the market-place.

There was nothing new about the state taking initiatives in the economy. Stolper and Barkai have both demonstrated that the growing intervention of the state in economic affairs from 1931 onwards was very much in the tradition of German state policy [9; 103]. Yet it would be difficult to deny that Hitler's advent to power in January 1933 did represent in important respects a shift away from the mixed economy of the Weimar Republic. The Nazis approached the German economy with no definite plan, certainly nothing like the Soviet predictive planning of the 1930s. They sought some way of providing a conspicuous solution to unemployment as a way to stabilise the regime politically. If we cannot quite believe Hitler's own claim to have spent sleepless nights trying to find a way to solve the question of ‘Bread and Work’, it seems clear enough that Hitler realised that his mandate rested on finding an economic strategy to end the recession. On Hitler's long-term plans there is less certainty.