Peace aud the Future of German Industry
Brandt, Albert A.
Peace aud the Future of German Industry Basic Social Changes Necessary to a Future German Democracy By Albert A. Brandt IS recognition of the war making power of the German industry, the Potsdam...
...found in the home market for »t the same time the production of steel bad increased at an enormous rate...
...The dsvnlspmssit of a country depend* tea great extant upon the bask rsw materials to which it has access...
...Millions of men were unemployed becsuse they were dependent on the top-besvy iron and steel industry...
...When a reduced living standard threatened to provoke social unrest, the capital goods industry, chief employer of manpower, began to seek new outlets for its products in order to compensate the worker...
...The lop heaviness of the capital good* manufacture resulted early in its proportionately larger employment of manpower...
...Easy accessibility to iron resources, too, combined to speed up Germany's indust.rializal.ion, whkh actually began later than in other parts of Europe —around 1871...
...A curtailment of its industrial machine based only on military considerations may prove a futile attempt to get at the Reich's inherent aggressive tendencies...
...Its prewar exports of 4,000,000 tons had not been maintained after Germany's defeat...
...It follows that democracy cannot be eetablithed irt Germany by political and constitutional change* alone...
...While foreign markets absorbed 700,000 tons in 1931, only 250,000 tons were shipped in 1934...
...But all available figures of consumption failed to clear the mystery of what could possibly be done with this steel...
...In 1933, the first year of Hitlerism, however, 7,000.-000 tons were manufactured again and in 1934, use for 14,500,000 tons was sought...
...In 1931 the metal-producing industries, for instance, accounted for almost 41 percent of the value of Germany's total export while in Great Britain the corresponding figure was less than 29 percent...
...After Germsny's defest, their power wss ss greet as ever...
...This is the top-heaviness of the Reich's capital goods industry...
...The growth of German heavy industry and all capital goods production related to engineering hat been spectacular since 1900...
...As Professor Keynes, in his iironontic Consequence...
...Unemployment was accordingly increased in Germany to 8,000,000, compared to less than 3,000,00* in Great Britain...
...In another article I shall present suggested solutions for the manifold economic problems of defeated Germany...
...Among the various sank factors one will prove to be outstanding and must be stressed as a warning for the future...
...The influx of foreign capital into Ger-lnnay's heavy industries after 1925 and the later five-year plan of the Natis, resulted in still greater abnormalities...
...No matter what the ekaugea in the Heii h const it villous I and political —they tonlrf always muster and use the aame combination of aatl aomarraMc powers which had farthered their interests in the preceding decades...
...Fear of social unrest as a result of long unemployment of workers dictated the policies of the heavy industries...
...If the mistakes of 1919 are to be avoided, fundamental changes in the social and ecu-, nomir structure must be envisaged...
...Nearly 10 percent of the nation's industrial workers were employed in making engines and cars alone...
...In 1898, the slogan, "Berlin to Baghdad," was first beard...
...German foreign policy showed new aggressiveness against Great Britain and Kuasia...
...A vast industrial economy, Oased -on these two materials, dtveloped, accentuating the production of iron and steel and investment goods generally...
...At that time the exports of investment goods bad greatly decreased and production of the machine manufacturing branch, for instance, ssnk to 68 percent of the 1927 level...
...The groundwork for World War I was laid...
...Approximately 28 percent of sll German industrial workers were thus dependent upon the smooth functioning of the capital goods industry...
...It is nonsensical to say that Hitler has come to power by one class alone, lis "revolution" ass been a total one, hacked by all strata of German society...
...tailed to peacetime requirements...
...Of the increase in steel production, 480,000 tons went on structural steel, sround 200,000 tons on machinery, 260, 000 tons on tubes snd 350,000 tons on railroad materials...
...The Treaty of Versailles left the industrialists undisturbed enough to plan together with the generals and the Junkers—and later with Hitler— an enormous piece of camouflage covering their intentions tu revenge the defeat of 1918...
...New outlets for steel thus had to In...
...It <»nnot be denied, howev-.-r, thnt the National Socialist Party mainly was aided in Ks rise to pwwer by the (reman industrialists and Junkers, tke two castes that predominate ia the social structure ef tke Army...
...Its success or failure determined the trend of foreign policy...
...Tnc official German Trade Research Institute stilted on December 30, 1934, that 15,-300,000 tons ha«' been manufactured in 1927, but in 1932 production had sunk to 5,600,000 tons with the result of a great increase in unemployment...
...It kas conditioned the Reich to sa lactational grouping of political and social farces...
...Armaments made employment for numerous workers in the abnormally expanding capital goods industry...
...It has become apparent that the victor's approach to this problem will be more realistic than after the last war...
...Abnormally large numbers of workers depended on them in the unbalanced economk structure which persisted from the time of the Kaiser, through the Republic snd under the Nnxi Fuehrer...
...e in the class composition of the population must be eliminated...
...Consequently the heavy industries played a gre> ter role in relation m the consumer goods industries in Germany than in nny other fully industrialised country in Europe, including Great Britain...
...That accounted for 1,277,000 tons of the inflation (of around 9,000,000 tons...
...Germany ha* one of tie largest coal deposits in the world...
...Behind their close collaborations was a desire for higher tariffs on foodstuffs snd semi-manufactured goods...
...The aggressiveness of tke National Socialist State began, it may be said, in 1934...
...In 1927, about 38 percent of all generated power was used in the manufacture of iron and steel goods...
...Tke part played by the German Junkers In tke light against the forces of tke German Republk hss been overrated Since World Wer 1, they here been economically insecure snd their influence •a tke State gradually waned...
...The result of any antisocial and anti-democratic combination in Germany has always been a consequent increase in the cost of living for the workers...
...of the Peace, has pointed out: "The German Empire is more truly built on coal and iron than on blood and iron...
...I.ark of markets for exports, between the years 1929 and 1932, decreased the value of the total industrial output in the Reich by about 43 percent...
...It lobbied for government orders...
...A New York Time* dispatch of January 6, 1934, mentioned that compared with the bad year 1932, Germany in 1934 had evailable over 9,000,000 additional tons of raw steel, partly manufactured by workers re-employed after Hitler's ascent to power...
...During its lean periods, deep changes could be recognized throughout the nstionsl economy, extending into the political sphere...
...Koi reasons rooted in the history ami geography el Germany, this industry has grown out of all proportion to the other.-., creating aa unsound balance between the prod 1.1 tion of ctaaanttr said capital goods since the 1...
...And it has shaped the coarse ef Gerasaa national aehcy...
...The top-heaviness of Germany's capit.nl goods industry was most conspicuous during the depression period...
...HoWEVER, this trend can be discerned in the record of the Reich since the beginning of the century...
...Mean while tke coal, steel sad iron barosu survived every crisis and grsw in pa-litkal strength with tke growth of their vast industries...
...How did tke capital goods ind ostry reach its reisest 1 and unhealthy growth...
...It lies in a certain peculiar aspect of Germany's national economy...
...The unsound predominance of the German capital goods industry led to aggressive tendencies in foreign relations...
...The best way to approach this problem may be an snalysis at a certain pattern of German aggressiveness which can be detected over a much knger period than the existence of National Socialism...
...In part at least, the policies of Germany since Hitler's riae to power can be explained in this way...
...The basic steel industry, too, had suffered greatly from dwindling foreign markets...
...The unsound Hal an...
...The German State developed a new aggressiveness in its foreign policy...
...The gargantuan heavy goods industry was appeasing its workers and protecting Its profits by prodding tke State to eliminate sources of social unrest by spectacular aggressiveness...
...Since there were none for their peace time products, the only alternative in the eyes of the big industrialists was the production of state-financed products...
...Profit-•We disposition of the products of the ksuvy metal and technical industries became all-important to the national economy, affecting the welfare of mil-tons of its rititens, from the top-flight ••nplnypr to the struggling worker...
...While at the bottom of the depression in 1932, around 1,700,01)» tons were shipped abroad, the steel barons had to face a new crisis in 1934, when such sales amounted only to 350,-000 „oiis...
...The United Nations fsce now a great responsibility...
...This would break the backbone of German militarism...
...The building of the Baghdad Railway was begun...
...Coal, indispensable for modern industry, has gained in importance with each new process and technic devised liy chemistry...
...A policy must be pursued which permits the Germans to destroy inside the Reich those forces which hsve been historically the causes of the state's aggressiveness, the Nasi party, the militarists, pewerful industrialists and, to a great esttat, the Jankers...
...In England and in France, however, it fell only about 23 percent...
...Statistics ten the story, in i»26, 'er Instance, more than 3,500,00« men were employed in industries based on steel snd iron...
...There were a few new markets in consumption goods, automobiles and perhaps ship building...
...Occuration of the Reich it merely the last military phase of the war...
...The dependence of investment goods 'Industrie* on foreign markets influenced the German State in its policies...
...At this time 90 pert-cent of Germany's total cspital investment increase had been financed with Reich ? ork-creation credits...
...They must establish some kind of control which will eliminate Germany's war potential but at the same time regulate the economic relationship ef the Reich with Europe and of Europe with the world...
...Peace aud the Future of German Industry Basic Social Changes Necessary to a Future German Democracy By Albert A. Brandt IS recognition of the war making power of the German industry, the Potsdam conferees agreed that the lakh's industrial machine must be cur...
...Every crista in this industry •book the whose German economy end disturbed the psychology of its workers...
...At that time, when the industrial barons were rising in power, the Prussian agrarian Junkers became their allies against the democratic parties of the middle-class and the workers...
...The control of the social caste which holds the German cspital goods industry in its power, must be wrested from ths imperialists by knocking the economic props from under them...
...During 1898 and 1900, it was instrumental in the success of Admiral von Tirpiti's naval extension program...
...Disarmament and re-education will not curb Germany's chronic aggression If its top-hesvy industrial colossus is left free to bestride its nstionsl economy and control the fate of the majority of its workers...
...Markets bad tu be found for their goods...
Vol. 28 • September 1945 • No. 35
