Hitlers Gamble That Ignited War | Blood Money Inside The Nazi Economy | Part 1 | Documentary Central

[Music] Poland Denmark Norway Belgium the Netherlands and France from September 1st 1939 Hitler started launching his troops across Europe inside their tons of armored steel was an instruction manual for the crew of the [Music] pancers this small Illustrated guide stated on the last page for every shell that you fire your father has paid 100 reichs marks in taxes your mother has worked a week in the factory and the trains have traveled 10,000 km the Tank's total cost was 800,000 reiches marks and 300,000 hours of work 30,000 people will have given a week salary 6,000 people will have worked a whole week so that you could have an armored combat vehicle everyone has been working for you the tank crew think about what you have in your hands at the heart of this German war machine a symbol of a powerful organized and Invincible Nation the Nazi regime was obsessed with money working hours and taxes the National Socialist policy had a certain cost throughout the history of Nazism the themes of money industry and economic organization recurred for 12 years between industrial rationalization monetary manipulation and ideological Obsession the Nazis invented its own economic system Hitler's regime fought and struggled to finance the war to invent a modern economy and to manufacture arms whatever the [Applause] cost Hitler arrived in power on January 30th 1933 on February 3rd he made his warmongering intentions clear to the military Chief of Staff our aim is to defy the Treaty of Versa to destroy the international monetary system and to expand in Eastern [Applause] Europe Hitler wanted to go to war ever since he'd written mum in prison in 1925 he was totally obsessed by war war waged by the strong against the Weak by the supposed Aran against the Jews War wasn't just an option it was the sole reason for the Nazis [Music] existence to go to war you need an Army in 1933 Germany didn't have one the Treaty of Versa had put a limit on Germany's Ground Forces to 100,000 men it had forbidden the country to have an Air Force or a [Music] Navy the military apparatus was very basic and the reiches there was forced to use pretend tanks s made out of wood and canvas in order to [Music] train one of Hitler's first decisions was to rebuild the Army and that needed money Germany had been ruined by years of Crisis and was broke 1930s Germany had a standard of living comparable perhaps to sou um South Africa or Iran today so a lower middle- inome country where you would expect to see a combination of cars and motorways perhaps and modern industry on the one hand and then peasants pulling wooden wheel carts with horses on the other it was poor in the sense that it was suffering from the effects of the Great Depression which were worse in Germany than anywhere else in the world except possibly the United States it was a comprehensive crisis of the German economy agriculture banking industry were all suffering 6 million people were unemployed it was heavily indebted to the outside world particularly to the United States debts they couldn't repay obliged to pay reparations to the Allies which they couldn't any longer pay foreign currency and gold had almost disappeared um 40% of the workforce was unemployed much of the rest of the workforce was on short time um trade had collapsed more than half between 1929 and 1933 um industrial production was down to the levels of the 1890s it was a country that had been bled dry which the Nazis dreamed of setting back onto the path of war in order to make war steel was needed steel required iron ore and coal rearmament depended also on petrol Rubber and chemicals a Workforce was needed as were engineers technicians and researchers to design and make arms German Industries had all this knowhow but where was the money going to come from money was The crucial issue since the Nazis had none they invented it a little known but providential man was in charge of this magic trick the minister of the economy and president of the reiches bank the German Central Bank Halmar shaked he invented the MEO bills so at the time H masat was often discussed as the wizard of German Finance the man who could kind of create money out of thin air and he'd first earned this reputation in fighting the hyperinflation of the 1920s but in 1934 shark says okay if you want to rearm um we have to find a special device for doing it uh because rearming was still still illegal under the vsi treaty they were not supposed to rearm so Shar had the idea that you would uh Supply these bills from a basically fake company the so-called Meo bills came from uh a fake company um which was a basically a mask so that the outside world could not see what was what was going on and those bills were actually given to companies that began to produce weapons as a as a kind of currency which could then be cashed at a later date uh when the government was able to pay them [Music] [Applause] back the MEO bills were created by Sha the MEO was a dummy company who had a capital of 1 million reichs marks provided by cup Seamans and other big names of the German metal and Steel Industries nothing was produced by the MEO no employees were taken on and no factories were opened the only thing the MEO did produce were debts which would help to finance the major part of the German expenditure on rearmament from 1934 in Practical terms any firm contracted by the Nazi regime to provide Goods required for rearmament was not paid in reiches marks the official currency but in bills of exchange issued by the MEO the bills were guaranteed by the state they were trusted and used as currency between arms manufacturers in order to finance their production the MEO bills became a parallel currency reserved only for the rearmament sector it was a very clever device because it first of all restored confidence secondly it veiled rehant from the outside world so they couldn't see uh what was going on uh and it meant that the government didn't have to pay for this and until some years later it avoided the risk of uh of uh of currency inflation it avoided um the problems that Germany had faced in the years after the first world war but because s Marat at the rice Bank promises to exchange its debts for cash at a tiny discount effectively is issuing the equivalent of cash and that of course is a very effective way of providing the Armament industry with the liquidity with the cash that it needs to start the process of production again in 1933 and then onwards from [Music] there shock's Conjuring trick worked like a charm in 1934 out of the 4 billion reiches marks invested in rarmen less than half was entered into the reich's official [Music] budget it was the beginning of an incredible upturn rearmament kickstarted the economy and freed the Germans from a long period of Crisis and self-doubt metal and steelwork industries were the big beneficiaries crops order books were full Tyson's blast furnaces were at full [Music] capacity IG faran started working on a new synthetic fuel engineers at Porsche Mercedes and BMW invented new engines to drive the tanks built by TR the planes that would be built by mmid and the ships and submarines built by Blom and [Music] Voss we would probably assume I think that German industrialists were very happy with the arment it suddenly meant there were orders coming in um they could start re-employing people again uh this might be a a real boom but actually many industrialists in Germany were very cautious about this they didn't want to do anything that upset the Allies or which put Germany at risk um so there was some hesitation in the early years and German industrialists Hitler was not actually the puppet of the big German industrialists [Music] kup Tyson IG farbin the great industrial families belong to a different world than that of the Nazi dignitaries even though Gustaf kup huge steel and Cannon maker distributed copies of mum to the deserving workers in his Essen factories he nevertheless remained wary of the Nazi party whose full name was the National Socialist German Workers Party [Music] the industrialists were distrustful of the regime's social Dimension but they were soon reassured that Hitler wasn't a Pinko rearmament guaranteed growth and the meos piled up in the coffers daau and Iranian BG were the first camps to open on March 20th 1933 and the first political prisoners were locked up there the following day for the leading German industrialists the arrival in power of the Nazis was a safeguard against the Communist threat it's fair to say that indoctrination started in 1933-34 the strongest measure was the outlying of trade unions in May 1933 then specifically in factories the Fe principle was introduced the leadership principle was one of command by and obedience to the boss with a very clear sense of hierarchy within the factories this meant that the employer's Authority took precedence over the corporate councils which had been one of the social advances of the viar [Music] Republic the Nazi order prevailed strikes were made illegal salaries were frozen and trade unions band they were replaced by the German labor front a single organization encompassing all workers big businesses wishes had come true for [Applause] this was the propaganda in Germany motorways Bridges and housing are being built by pick and [Music] shovel away from the Munitions factories which Ed a huge majority of jobs the fur took the unemployed off the streets and gave them work on building sites and motorways this was the Nazis economic [Music] Miracle they LED people to believe that a society of leisure and consumerism based on the American model was possible the regime was social it built houses for the German families and cruise ships for their holidays [Music] goods manufactured for the people were given priority the people's radio was mass-produced as was the famous people's car the Volkswagen the economic miracle of the Nazi regime is an attractive idea obviously for for the regime itself and in fact it has admirers around the world there is a real sense in which contemporaries feel that they have found ways to control Master the economy and make the economy subject to human will and politics but the element of it which is deceptive if you like is the balance and the costs and the benefits right is this a miracle in the sense that it's it's a completely free lunch um and it is not a completely free lunch uh in the case of Nazi Germany any more than it is in the case of the new deal or the Soviet Union because in the process of economic growth more economic activity is created people are on the whole on average definitely better off by 1938 than they were in 1932 but the balance of the economy has shifted dramatically towards the Armament sector it is the largest single shift in EC e omic resource economic production by any non-socialist state in peace time in the historical record defense goes from essentially 1% to 0% of German GDP to 20% by 1938 in the space of 5 years 2 million unemployed went back to work 5 years after Hitler's accession to Power full employment was achieved but Prosperity was not widespread in 1934 a workingclass household spent around 50% of its Budget on food drink and tobacco wages were cut back but it didn't seem to matter German Workers had Newfound hope they were encouraged to scrimp and save so that one day they could afford a people's car an illusion no German started driving a VW until the [Music] 1950s it's common in thinking about the Nazi regime to ju oppose guns and butter and the idea is if you like that the German population uh did without consumption because the political priorities of the regime dictated rearmament this is true from the point of view of economic statistics what it doesn't capture is the extent to which the German population at large in fact gained if you like psychic satisfaction from the process of re arment the real people's product was in fact the [Music] army on March 16th 1935 Hitler reintroduced military service rearmament became official and was in plain view so there are a few things that the Nazi regime did over its entire history that were more popular than the reintroduction of conscription in 1935 there is a huge sense that Nazi Germany is restoring to the German Nation to the German public something which they have been deprived of since World War I since since the honorous terms of the Versa peace treaty the pleasure the very genuine pleasure in seeing the nation in arms seeing your young men being drilled into real soldiers into real men in other words now this cost money sure but it's you know price well worth pic for this Collective pleasure to put it very concretely when you're drafted into the army they might train you to drive they're going to give you a fancy new machine gun to practice with they're going to show you how the radio works and you will go on maneuvers and there will be dive bombers flying overhead it's a Hightech experience that you cannot have in provincial Germany in the 1920s the militarization is a process of modernization of a collective [Applause] kind War started to enter public Consciousness rearmament parades became popular huge parties were organized every year and mock battles were put on the Army's assault tanks and fighter bombers were on display for all to see Nazism reorganized the whole economy and all of society around its vision of War [Music] War became Mass entertainment in 1936 the new reich's Army the vermar reoccupied the reinand a major Industrial Steel working area which had been demilitarized since the Treaty of their sign [Applause] [Music] to continue the March towards War Industry needed more and more raw materials Germany had little or none they had to buy them from abroad and pay in gold or in currencies such as dollars Franks or pounds none of which Germany had either shocked started to worry the meos had certainly helped kickstart the economy but now they had to be paid back continuing at this pace was impossible this overheated economy needed to be slowed down which meant holding back rearmament and gradually paying back the MEO debts this is what he told Hitler and sha says you can't sustain rearm much Beyond this level I'm happy with what we've achieved so far but if you rearm more heavily and more heavily it's going to create all kinds of problems for the German economy violent argument breaks out within the Nazi regime between sha on the one hand who Advocates nationalism and the rebuilding of German strength and a politics of power towards Germany's neighbors but is concerned about the balance of the German economy and is not interested in a full-on confrontation with the major powers of the world which are Britain and France still at this moment and the figures not around ging who basically want to push rearmament to the maximum extent so Hitler thinks about this and he decides that he's going to shift control over the economy away from Shak and the experts to somebody in the party who does he choose he chooses the most unlikely person he chooses Herman guring guring a Nazi from the early days and Senior official of the regime was put in charge of the German economy in order to force through continued rearmament the meob bills could wait and so he makes gearing head of the second fouryear plan the first fouryear plan was a fouryear plan for Reemployment after 33 the second fouryear plan begins in October 36 and transforms the German economy um ging assumes responsibility over trade foreign currency um price control uh investment uh and under ging's um Direction um a major program of so-called self-sufficiency is [Music] undertaken [Laughter] [Music] for Germany only had its own strength to rely on ging brought in a policy of economic autonomy Beginning by creating factories in his name the Herman guring Works were founded in 1937 to enable The Mining and transformation of Salter's poor quality and unprofitable iron or otar also enabled the development program for synthetic rubber called bua made by the giant firm IG farbin whose profits soared by 90% Germany needed to become free from all its petrol Imports as quickly as possible enormous public Investments sped up the program of the production of synthetic fuel but otari had its price one ton of Steel from ging's factories was three times more expensive than one ton of imported steel from Romania or the Soviet Union the difference was paid by the state who haded out staggering sub ities nothing was spared for autonomy from a strictly economic point of view otari was not a rational decision the Nazi economy closed in on itself in order to prepare for war on the economic level War had already been declared they're not unrealistic enough to imagine that that Germany can ever really be self-sufficient the aim of the game is to harden Germany for the war that is to come is to make it more resilient than it had been in World War I this is of course at the same time that the the Nazi regime escalates foreign policy tension there is the anchos with Austria early in 1938 and then the very deliberate push to dismember Czechoslovakia by way of sedan land and this raises the international tension in a way that the regime was not really [Applause] hadf with the anus the annexation of Austria in March 1938 and then with the pilgrim of Chrystal in the same year the outlines of a specifically Nazi economy were drawn an economy which Incorporated systematic anti-Semitism into the regime the vision of the enemy is not the big industrialist the cigar smoking steel Baron the vision of the enemy for the Nazis is quite specifically money Capital it is the banker it is the fosier and of course that figure is indelibly Associated all the way back to the Middle Ages in European anti-Semitism with the Jew and so Nazi anti-Semitism is directly linked to an economic ideology which is hostile to Commerce which is hostile to finance which is hostile to money which regards these things as Foot Loose as indeterminate as not rooted in the soil of the nation as belonging to a race which is the sworn historic race Jews were often considered as parasites belonging to the golden cek of Global Financial capitalism symbolized by gold and money on the other hand there was the world of blood and soil of loyalty and honor associated with Germany in the National Socialist Vision money and race were incompatible because Monetary Exchange implied mediation and trade between people the Nazis were hostile to money and yet needed it to finance their economy in this new economic Paradigm which the Nazis were trying to put in place Aryans were not supposed to buy they could just take they shouldn't pay they should steal and steal principally from the Jewish population the plundering of the Jews and the violence against Jews went hand inand it happened in Austria from March 1938 it happened with the pogm in Germany sometimes called the night of broken glass on November 9th 1938 firstly their belongings were confiscated secondly communities were attacked both synagogues and individuals it created an atmosphere which was supposed to provoke Jews to leave the country and on a more practical level it brought in a great deal of wealth of money to the r in the summer of 1938 an office was set up in Vienna specifically to deal with the immigration of Jews this office was set up by ikan its aim was to tax the Jews heavily on their departure to force them to pay this tax and leave behind all their possessions in Austria the same setup was copied in Berlin in January 1939 so it was clear from the outset that spoilation was linked to a mechanism of exclusion in order to pay for the damage of Crystal KN the Nazis imposed huge fines in the Jewish Community the shop Windows had to be replaced urgently requiring imported glass from Bel Belgium which would cost the reiches bank 3 billion marks in Precious foreign currency guring was Furious even senior Nazi officials were obliged to follow the rules of Market forces for just a while [Music] [Music] longer despite the money stolen from the Jews the annexation of the Austrian steel mines and factories the requisition of Czech tanks and despite the intense mobilization of German factories the fur still didn't have the Army which he needed to conquer [Music] Europe the vermak which paraded for Hitler's 50th birthday in Berlin in 1939 was only partially motorized the Army mostly paraded on Horseback and on [Music] bicycles kups armored vehicles were on Parade but still technically inferior to French [Music] tanks the Navy only had five battleships and the Air Force didn't have a single heavy bomber the question of whether Germany was ready for war in 1939 has haunted all debate since then because it Bears on the question of how we think the war started um those who believe that Germany was ready have a intentionalist view if you like they view the war as the product of Hitler's of Hitler's uh decision- making in a straightforward and linear fashion those who think the German economy was not ready for war in 1939 tend to think of it as it were the war resulting from a miscalculation my own view is that the realization on Germany's part that the German economy was not ready for war produced perversely a decision to go to war Hitler is often accused of not having a very good grip of the economics not following the details I don't think this does him any justice he understands what they are and he just concludes that from a grand strategic point of view if you are committed to war if you know there must be War and you know there must be War because your broader ideology tells you if you don't wage war the Jews will wage war on you some other way in other words you must move to the open phase of War if Germany is to have any hope at all of surviving the German race of surviving then now is a better moment than two or three years from now even if the Tidy military bureaucrats would rather have their projects finished by then Hitler told his military Chiefs we've got nothing to lose and everything to gain thanks to to the restrictions our economic situation is such that we cannot hold out guring will tell you we have to [Music] act to everyone's surprise Germany and the Soviet Union signed a non-aggression pact the German Soviet pact was signed on August 23rd 1939 the most important decision by Germany is of course the alliance with the Soviet Union uh the Hitler stallin pack uh uh of the fall of 1939 which cements the Soviet Union both as a strategic partner in the destruction of Poland but also as a fundamental source of key economic supplies for the German war effort crucially oil some grain as well key uh iron ore metal metal ores for steel production so this secures if you like the hint land of the German of the German war [Music] effort on September 1st 1939 German troops invaded Poland victory was quickly and resoundingly won but Munitions were in short supply and a quarter of the assault tanks were decommission this put a damper on things for despite the massive rearmament program that had been forcibly imposed since 1933 the economy was still not responding the invasion of Poland Drew France and the United Kingdom into the conflict the phony War Began French and German troops observed each other from behind their casemates on the magino and zigfried [Music] lines this rest bite enabled the Nazi war economy to carry out a thorough [Music] reorganization one of the things that became clear as soon as the war had broken out was that nobody was really controlling the war economy Hitler decided that the time had come to appoint a minister responsible for the production of Munitions and weapons and he appointed Fritz tote um Nazi party engineer who had been the man responsible for building the motor ways in the 1930s building the fortifications in 1938 39 40 and so on a man that Hitler trusted and he was made minister of Munitions and the idea was that he would now supervise what was going on to make sure that some kind of order could be brought into the war economy the military didn't like being bossed around by a civilian and the problem was that aircraft reduction was not under his control he had no control over Labor uh he couldn't control prices um he couldn't control the allocation of raw materials um so that he was operating all the time against other parts of the economy uh that had their own interests to uh to pursue ging for example wanted to carry on with the big investment programs in raw material production etc etc even though those resources were needed to produce armaments [Music] Hitler made some drastic choices he sacrificed the Navy maintained the tank building programs but made Munitions and the Air Force his two main [Music] priorities the luftwaffle was allocated 40% of military expenditure and above all the production of arms shells and ordinance was multiplied by [Music] eight the Armament Minister toot managed to focus the War Industry on specific and short-term achievable aims the only thing that counted was immediate war and nothing but War the gold was achieved between January and July 1940 arms production doubled the most spectacular increase during the whole [Music] war in May 1940 Denmark and Norway were invaded followed by Belgium the Netherlands Luxembourg and France all within the space of a few weeks a feeling of euphoria broke out in the Reich in the propaganda films against a typical backdrop of stukas and Invincible pancers the regime celebrated the Triumph of Mind Over Matter Germany a poor country trapped within a territory that was too small had found its Soul again thanks to Nazism the nation was able to surpass itself and surmount the lack of money and shortages of raw materials the Nazi economy succeeded in freeing itself from Material considerations in reality the German ger people were hungry the tanks needed Fuel and so the war economy claimed what it was owed the National Socialist regime was waging the war on credit credit hidden by the MEO bills which the regime began to pay back by printing money and credit based on the collateral of goods plundered and pillaged in the occupied [Music] countries the Nazi economy had to feed off War military equipment raw materials supplies of petrol tin copper nickel locomotives and cannons were systematically confiscated and stockpiled in a huge wartime [Music] booty one way of doing of course was also to take money from the occupied areas France for example had to supply Germany with a very large quantity of of money to fund the German war effort uh same was true of other parts of Europe France was the richest part of occupied Europe uh in the end about a third of the expenses of a German war effort were met by finances taken from the occupied area silver gold coal from Poland cials from France the Nazis stole from all over Europe its economy needed this expolation in order to function German soldiers had to steal for food corruption became commonplace and everyone helped themselves where they [Music] could before 1933 in particular Nazi propag Anda constantly repeated that militant National socialists were all victims of the system victims of democracy and victims of the Jews so after 1933 when the Nazis attained political power not only did they have no moral inhibitions but they weren't even conscious of acting illegally when they got rich at the expense of the victims for example many of them thought that it was perfectly normal and that it was what they were entitled to the particular entitlement of the strongest implies that they didn't feel obliged to take into consideration the rights of the weakest and by definition this ideology encouraged corruption when victims are Deni their human rights and their ownership rights then it is totally justified so to speak from an ideological point of view to dispossess the victim Hitler and guring were particularly Adept to corruption they were by far the greatest art thieves in history her guring alone stole more than 1,375 paintings 250 sculptures and 168 tapestries whose present day value has been estimated at several billion euros to put it another way there was an outrageous conf between the economy the state the party and the private sphere which were clearly Inseparable from one another Germany was short of everything food raw materials money and military equipment in the defeated and occupied countries there was organized pillage stealing became legal and Common Place in mixing improvization and theft the German War economy was a huge [Music] shambles [Music] d

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Keywords: free documentary, documentaries, full documentary, documentary - topic, documentary (tv genre), history, history documentaries, free documentary history, history documentary, history of germany, third reich, nazi germany documentary, economy of nazi germany, history of the third reich, economy during world war 2, world war 2 documentary, wwii documentary, adolf hitler documentary, hjalmar schacht, economy of the third reich, german economy, second world war

Id: FE9xTVJ2L90

Length: 46min 49sec (2809 seconds)

Published: Sat Feb 10 2024