Rise of Hitler / Causes of wwii basic Review The Great Depression and Economic Nationalism

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Rise of Hitler / Causes of WWII Basic Review

The Great Depression and Economic Nationalism

Causes in the USA:

    • Overproduction

    • Uncontrolled use of credit-buying (concealed over-production)

    • Speculation

    • Weak banking structure

    • Uneven distribution of wealth

The Effects of the Depression in the USA on Europe

    • Recall & refusal to renew short term loans

    • The collapse of the German economy

    • The system of international debts and reparation payments collapsed

    • There had been an outflow of gold towards the USA / the Great depression magnified this unhealthy tendency

    • Shrinkage in world trade

    • Prices fell due to lack of demand / rapid rise in unemployment

    • Social problems led to a rise in political extremism

    • Led to the development of Economic Nationalism (promote recovery in ones own country at the expense of others)

Reasons for Economic Nationalism:

    • Isolationist policies of the USA who imposed heavy import duties which led to retaliation from European states

    • Keynes promoted Gov. intervention and this tended to result in economic nationalism

    • USSR was the only one not to experience the effects of the depression and this led to a belief in tight state control as the way of the future.

    • Failure to keep international agreements

    • The rise of fascism which was highly nationalistic

Effects of Economic Nationalism:

    • Short term benefits to some countries, i.e G.B and German, but it is doubtful that there could have been long term benefits, but the outbreak of WW2 totally changed the economic scene

    • Caused a further contraction of the volume of world trade (imposed imposition of tariff barriers)

    • Contributed to deterioration in international relations

    • Promoted Gov. intervention/management of the economy

    • In the long term, world leaders came to recognize the importance of economic cooperation and institutions such as the IMF and the World Bank were established.

Interwar European Economic Problems 1919-1939

The Economic Problems of Great Britain 1919-1939

    • Britain was a trading nation and its prosperity was built on her early industrialization however after WWI Britain became a debtor nation, causes of this include:

    • Britain was challenged as other countries industrialized

    • New post-WWI trading patterns were not in favor of Britain

    • Britain had little left (after war debts) for import payments

    • The post-WWI rise in protectionism damaged Britain given the nature of her economy (trade based)

    • The break up of A.H. deprived Britain of a valuable export market

    • British industry was becoming outdated

    • Solutions to Britain’s economic problems:

    • Exporting more

    • Import less

    • Increase invisible exports

    • Difficulties w/ the solutions:

      • To export more, Britain would have to produce cheaply which meant either:

        • Using more efficient methods of production (v. expensive)

        • Reducing pay/ increasing work load (socially unacceptable)

      • To import less Britain would have to impose tariffs on foreign goods (this would be unpopular b/c Britain was a major importer of food and therefore this would lead to a decrease in living standards.)

      • To increase invisible exports Britain would have to restore confidence in her economic security. To do this Britain:

        • Announced in 1923 that it would honor all war debts — and to do this taxes increased and British goods became more expensive (therefore visible exports declined)

        • Announced in 1925 that it would return to the Gold Standard — this pushed up the value of the pound which resulted in expensive British goods and in British noncompetitiveness. (the Gold Standard was abandoned in 1931)

    • During the inter-war period, high U. led to social unrest and led to five changes in British Gov. (btw 1919-1931)

The National Government 1931-1940

    • Took Britain off the Gold Standard

    • Free Trade was abandoned

    • High tariffs were imposed on goods (those suspected of being ‘dumped’ on Britain)

    • An import duty of 10% was imposed

    • A system of ‘imperial preferences’ was set up w/ free trade btw Britain and her empire

    • Reduced interest rates (easier to borrow)

    • Limits were imposed on the export of capital

    • Wages were driven down by the depression and heavy U.

    • Imports of raw materials were cheaper b/c of the depression

    • Improvements in manufacturing lowered prices

    • Lower prices led to increased consumption despite lower wages

The national Gov. brought about the small beginnings of a slow recovery.

The Economic Problems of France 1919-1939

But, France had been the major battlefield for WWI and suffered greatly as a result. Her problems were:

    • Loss of revenue in areas which had been devastated by the war

    • Bankruptcy of the French treasury (due to massive borrowing)

    • Manpower shortage because of heavy war losses

    • The newly developed industrial sector promoted trade while the agricultural sector promoted projectionist policies.

    • The taxation system was outdated and inefficient

    • The French Gov. relied too much on reparations

France needed an economically strong Germany but its politicians sought to cripple Germany.

In relation to Germany and Britain, France performed well in the 1920s.

    • France relied less on trade and more on agriculture and suffered less from the shrinkage in World Trade.

    • France had a strong agricultural base

    • France obtained resource-rich areas from Germany

    • The franc was undervalued and this helped French exports

    • The French Gov. was divided and weak, and could not take decisive action (such action in Britain deteriorated the situation rather then improved it)

Problems in the 1930s:

Serious unrest and difficulties in agriculture and industry, in response the Socialists (unpopularly:)

    • Reduced salaries in the civil service

    • Reduced pensions to ex-servicemen

    • Closed down public work schemes

    • Increased taxes on Consumer Goods

(1934-1936 a right wing Gov. came to power, later extremist right wingers attempted a coup which failed and led to the rise to power of the Popular Front)

The Policies of the Popular Front

    • Its victory was followed by a series of strikes by industrial workers

    • This brought the economy to a standstill and

    • Led the right wing to fear revolution

The Matignon Agreement: (1936) (agreement between left and right wing Gov. factions)

    • Its measures were: 12% rise in wages / nationalization of armament works / greater Gov. control over the Bank of France / paid vacation for all workers / a 40 hour week / recognition of trade union rights / the end of occupation of factories and the owners retained control

    • The problem of the agreement was the question of paying for the agreed reforms.

    • At first the Gov. relied on borrowing

    • Later the franc was devalued but this did not stimulate recovery b/c of the reduction of production (due to a 40 hour week)

Why was the Gov. unable to deal w/ the problems?

    • Huge debts had been incurred and the leadership demoralized

    • There was a large/powerful agricultural lobby

    • Industry was backward

    • Those who controlled financial institutions (rich industrialists) were conservative

    • Civil Service control lay in the hands of right wingers who were opposed to reform

    • French politics were polarized and cooperation btw left and right was small.

The Economy of the USSR during the period 1919-1939

    • The introduction in 1928 of a new system of central planning brought about rapid development

    • The USSR began to catch up with the advanced countries of the West.

Why did the USSR avoid the Great Depression?

    • She developed her economy in isolation of the world trading system and:

    • Stalin aimed at achieving autarky and to this end lessened the importance of imports upon the USSR

    • The USSR was isolated diplomatically. (the USA established diplomatic relations w/ the USSR in 1933)

    • The Gov. had great control over the economy (ie: prices and wages were fixed)

    • Soviet industry was not consumer oriented

    • There was no possibility of speculation by bank

    • No independent labor unions, and therefore no disruptive strikes

    • There was not the vast inequalities in wealth distribution that existed in the West

    • And there was:

    • No political opposition

    • No interest groups to oppose economic measures

    • The Gov. was not subject to public opinion


    • The methods were not transferable to the West (the USSR was a totalitarian state)

    • Behind economic successes lay "slave labor camps, mass executions and wholesale starvation" (in parts of the USSR)

    • The Soviet system proved in the long term to be inflexible and unable to progress beyond a certain stage.

The Economic Problems of Germany 1919-1939

    • Political instability / Germans did not accept the constitution of the Weimar Republic

    • Germany lost her colonies and territories (therefore resources, population and industry) when she most needed them

    • Germany had to pay reparations

    • Anti-German feelings were high and this damaged German exports

    • Germany had to hand over "huge quantities of industrial machinery, merchant shipping, railway engines, and wagons" which were needed by Germany

    • Parts of Germany were occupied

1919-1923: All progress was destroyed by the occupation of the Ruhr. As the economy collapsed, the currency became worthless and social unrest rose.

1924-1929: Germany began to recover economically (w/ the Dawes and Young plans)

1929-1933: Germany’s economy was destroyed by the Great Depression / this led to the rise to power of Hitler and the Nazis

The Economic Policy of the Nazis:

    • Hitler seemed to have brought by the late 1930s an economic miracle, his methods were:

    • A high degree of central planning

    • The use of production targets for key areas

    • The use of strict controls on the distribution of raw materials

    • A drive towards autarky / cutting down of imports

    • Labor Unions were abolished as early as 1934

    • Measures to reduce U. included:

    • Increases in public works

    • Rapid expansion of the armed forces

    • Banning certain social groups from certain jobs

    • The growth of the Nazi party

Characteristics and Appeal of Fascism

Characteristics: (during inter-war period)

    • Strongly nationalistic

    • Strongly/Violently anti-Communist

    • Anti-Liberal-democratic

    • Opposed to international org.

    • Elitist and Authoritarian (‘Obedience not discussion’ — Mussolini)

    • Close identity btw the party and the state

    • Strongly anti-Semitic

    • Glorified war (promoted Social Darwinism)

    • Profoundly racist

    • Had a paramilitary wing (ie: Blackshirts / S.A.)

    • Promoted the myth of the race (use victories of the past)

    • Placed emphasis on the myth of the predestined leader

    • Made great use of symbolism (ie: swastika)

    • Did not have a clear doctrinal base

Reasons for the Appeal of Fascism

    • Fascism was not clearly developed in theory and could appeal to all groups irrespective of status

    • The emphasis upon law and order was appealing (it was seen as an alternative to social unrest)

    • People were turning to other forms of Gov. due to immense economic problems.

    • Weak governments were easy preys for the fascists

    • The fear of communism led to support for the fascists who were violently anti-Communist

    • Fascism gave its members a sense of identity

    • Fascism made great use of the potentials of the newly developed mass media

    • Traditional parties lacked inspiration and the fascists:

    • Represented a dynamic alternative

    • Were not opposed by the Gov. which they sought to bring down

Fascism in Germany

Reasons for the Rise of Fascism in Germany

    • The economic collapse of Germany after 1929 (main reason)

    • The lack of democratic roots in Germany

    • Under the Weimar republic

    • It was impossible to secure a majority in parliament (this depicted democracy as a weak Gov. system)

    • The president had the authority to declare a state of emergency (Hitler used Hindenburg’s ability to do this in order to establish his dictatorship)

    • The fear of communism (Hindenburg appointed Hitler as chancellor as a result of such fears)

    • The Nazis exploited the weakness of the Weimar system and often used violence against their opponents

    • The Nazis made use of propaganda to shape public opinion

    • The Nazis used resentment against the Versailles Settlement to their ends.

    • Some other political parties did not support democracy and represented potential allies for Hitler

Characteristics of National Socialist Rule

    • Germany became a one party state

    • Hitler was supreme within the party and he was taken as the personification of National Socialism.

    • Totalitarianism was introduced

    • Education was controlled

    • Strict censorship of the media

    • All non-Nazi youth movements were banned and replaced (ie: by movements such as Hitler Youth)

    • The churches were brought under Nazi control

    • Trade Unions & strikes were banned

    • The use of terror was made to crush all resistance

    • The army was brought under Nazi control

      • Officers swore loyalty to Hitler

      • Gradually Nazi officers filled army ranks

      • The non-Nazi commander and war minister were removed in scandals at least engineered by the Nazis

      • The S.S. was built up

    • The Nazis made great use of propaganda

    • The economy (see previous notes)

    • Racism / The Aryan Germans were declared to be the ‘Master Race’

    • Expansionism / Hitler claimed to reunite all Germans and Nazi interests centered on obtaining land in Europe

    • There was a close identity between party and state

    • Centralization of power.

An Evaluation of National Socialism

    • Failed in the long run and brought disaster to Germany

    • Brought short term benefits (see notes on Economic Problems)

    • Drove to exile Germans who could have contributed greatly for Germany (ie: Einstein)

    • There was strict censorship of art, literature and academic life; which all did not flourish under the Nazis

    • Women’s rights suffered

    • Loss of civil liberty

    • Nazi extremism brought about Allied extremism and eventually events such as civilian bombings (ie: Dresden)

    • Some successes: construction of autobahns, establishment of enterprises like Volkswagen, and scientific advances in areas such as synthetics, and rocketry.

An Evaluation of Nazi Economic Policy

    • Difficult to measure because of Nazi manipulation of statistics

    • Increases in output were directed to the armed forces (this meant recession was inevitable except in the case of war)

    • Economic improvements were accompanied by loss of individual freedoms

Rise of the Nazis in Germany

The ideological roots of Nazism

Its roots lay in two movements of the last 25 years of the 19th century:

    • Anti-Semitism which grew during that period of depression and from the racial theories of the time

    • Radical right-wing politics (i.e.: Pan-German League) in favor of authoritarianism.

From its founding to the putsch of 1923:

    • Founded during the chaotic period immediately after WWI. Bavaria was then under the control of a right wing Gov. which sheltered extremists (including the Nazis)

    • Formed Jan. 9th 1919 under the name German Workers Party (DAP), Hitler joined as propaganda chief in Sept.

    • Aug. 1921: Hitler became leader and introduced: the notion of the leader / a more centralized system w/ all branches subject to the authority of the original branch in Munich.

    • June 1922: the now renamed National Socialist German Workers Party (NSDAP) is banned in all states except Bavaria.

The Munich or ‘Beer Hall’ Putsch:

    • End 1922: Germany defaulted on reparation payments

    • Jan. 1923: Invasion of the Ruhr

    • Aug. 1923: Streseman became chancellor (& called for passive resistance and began negotiating w/ the French)  Hitler saw this chancellorship as the beg. of a communist takeover…he decided to lead a putsch.

    • Hitler decided to convince leading members of the Bavarian Gov. to help him on his ‘March on Berlin’ he seized them, they gave their consent but once released w/drew their aid. On Nov. 9th 1923 the Nazis marched on Gov. buildings and were dispersed by gunfire and had their leaders arrested.

    • Hitler went for 5 years in prison, but now he was a nationally known figure.

The Creation of a Nationwide Party Organization (1923-1928)

Background to this period:

    • period of recovery / the Weimar Republic seemed to have survived attempts against it and have gained support

    • 1924: the Ruhr was reintegrated into the German economy / the Dawes Plan (rescheduled payments and made loans)

    • 1925: Locarno Treaties — Germany accepted the frontiers of 1919

    • 1926: Germany joined the League of Nations

    • 1928: Kellog-Briand Pact

These favored improved international relationships and recovery. The appeal of extremists (i.e.: declined during this period).

Nazi Party Measures:

    • Re-founding of the Party, Feb. 1925: Hitler re-founded the party (which had been banned) to participate in the political processes of the Weimar Republic. Hitler planned to use the democratic process to gain power, and then destroy it.

    • Consolidation of the ‘Fuhrerprinzip’: Dispute (over participation in elections / the Party Programme) was ended when Hitler imposed his views, and by 1926 his control of the party had been greatly strengthened.

    • Creation of a Party cadre: the country was divided into Party regions w/ a leader for each region.

The Role of the S.A.: Hitler restricted its activities to propaganda and bodyguard duties since he did not wish to antagonize middle class & wealthy supporters.

Nazism Becomes a Mass Movement 1928-33

The insecure foundations of economic prosperity:

    • US short term loans were invested on long term projects

    • Middle classes being ‘squeezed’ by gains made by: the leading industrialists who were forming into large thrusts / the workers, whose unions had pressured for higher wages, etc…

    • World wide agricultural depression by late 1927

The effects of the May 1928 election:

Gain for left wing parties, decline of the right. The right and center parties concluded that coalition Gov. had weakened them. There was danger that the parliamentary system would break down b/c coalition Gov. would not be possible.

The Economic Depression 1929 onwards:

    • Had to face withdrawal of US short term loans

    • The Young Commission and the Great Depression served as foci for right wing attacks against the Versailles settlement.

    • March 1930: collapse of Gov. coalition / appointment of Bruning (Catholic Center Party) He tries to force unpopular budget measures.

    • Sep. 1930: Election in which Nazis become the second largest party in the Reichstag.


    • Modern techniques (press campaigns, whirlwind campaigns by air, film shows, etc.)

    • Forming special propaganda sections for individual interest groups.

    • Emphasis on appeal to youth.

    • Nationalism as a uniting force.

The Struggle for Power 1930-33


    • Reluctance of conservative right wing parties to ally w/ the Nazis. They wanted: Nazi officials only in minor cabinet posts / Nazis to drop many of their demands and restraining their followers.(becoming more ‘civilized’)

    • Attitude of Pres. Hindenburg

    • Divisions w/in the party. Hitler did not want to alienate the army & the wealthy industrialists. However, opposition w/in the party felt this would betray the revolutionary nature of the party (such feelings were strongest in the S.A.)

The Major developments of this period:

    • See notes

    • Jan. 1933: Hindenburg appointed Hitler Chancellor b/c:

    • Only way to have mass support for a right wing Gov.

    • Instability during 1930-33 might turn to the advantage of the left

    • He was persuaded the Nazis would become more moderate

    • He was persuaded Hitler could be controlled (clear majority of non-Nazis in cabinet)

    • Hitler accepted b/c:

    • Loss of seat in Nov. 1932 election foreshadowed a decline of the Nazis

    • He believed that once in power he could strengthen his position

    • He hoped he could organize the next new elections so the Nazis would obtain an overall majority

    • He had demanded the Enabling Act to give him special powers to deal w/ the crisis and thought this act would pass.

The Seizure of Power 1933-34

Situation in 1933:

    • Only three cabinet posts held by Nazis / no Nazi Reichstag majority / Hitler could be dismissed by Hindenburg

    • Hitler represented only hope of the Right for mass support / the Right could not simply govern through pressure groups (army, business, etc.) / Hindenburg becoming increasingly senile.

The Election of March 1933:

    • Nazis received generous donations from industrialists (who feared a left wing revival)

    • Goring (then Prussian Minister of the Interior) allowed Nazi violence in the campaign to go on uncontrolled.

    • Opponents of the Nazis had a passive attitude.

    • The Reichstag Fire: Feb. 27th 1933 The man considered responsible was a communist  The Nazis claimed it was a beg. of a communist takeover / Hindenburg passed the ‘Decree of the Reich President for the Protection of People and State’  Hitler could: ignore restrictions on police power / take over the power of the German states  using this, the Nazis arrested communists and other political opponents.

      • Results: Communists were banned, and Nazis in coalition w/ the Nationalists obtained a majority.

The Enabling Law

To obtain 2/3 majority needed to change the constitution the Nazis carried a campaign of intimidation: they depicted opposition as unpatriotic / Nazis in the S.A. seized control of state Gov. / opponents in the SPD and trade unions were arrested / the building where the Reichstag was surrounded by S.A. and SS troops. This law granted Hitler the right to:

    • make laws w/out Reichstag approval

    • make treaties w/ foreign states w/out Reichstag approval

Hitler now no longer needed the support of political parties.

Creation of a one-party state:

    • June 1933: SPD banned

    • July 1933: Law makes all political formations (except Nazis) illegal

Conflict between Hitler and the S.A.:

    • The S.A. demanded that Hitler follow socialist measures as laid down in the 1920 Nazi Programme

    • The S.A. wanted a greater say in party affairs

    • They wished to replace the army w/ a national militia

Hitler feared that they would lose him the support of the non-Nazi right, and the army. The army was then the only group w/ the power to remove him.

The Night of the Long Knives:

Night of June 30th/July 1st: arrest of the main S.A. leaders by the S.S. / leaders are shot / Hitler congratulated by Reichstag, Hindenburg, & the army.

Death of Hindenburg:

Aug. 2nd 1934: Hindenburg dies / Hitler replaces him w/out election  now referred to as the Fuhrer / new oath of loyalty for soldiers and civil servants (to Hitler)

A Drive to a Totalitarian State, Main Measures of the Nazis: 1934-36

    • Professions are ‘synchronized’ w/ Nazi beliefs. (i.e.: teachers / judges)

    • Purges of Gov. workers of communist sympathizers, Jews and replacement by party members.

    • Nazis tried to restrict the influence of the Church and the application of the 1933 concordat (allowing the Catholic Church to have its own school & property but to keep out of politics) Nazis took more direct control over the Protestant churches…soon swastikas were displayed alongside the Christian Cross.

    • Membership of one Nazi youth group was obligatory for all Germans until age 18.

    • Toward workers: labor unions abolished, establishment of ‘Strength Through Joy’ movement which provided subsidized holidays, sporting activities, etc.

    • Creation of Ministry for Popular Enlightenment and Propaganda — bringing under control the mass media and using them towards Nazi propaganda.

    • Rapid expansion of the S.S. (w/ Himmler) In 1934 the S.S. became an independent org. answerable to Hitler and Himmler only. Gestapo was placed under its control. Reg. Criminal police merged w/ the S.S. in 1936.

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