Background information and data
Adolf Hitler rose to power in Germany in 1933. During his rule, he implemented a range of economic measures that, according to some, made the German economy more successful. Such measures included introducing economic planning, ensuring full employment and expanding the production of consumer goods.
According to economist Adam Tooze, writing in 2017, the German economic recovery during Hitler’s rule was ‘remarkable’ and ‘spectacular’. The expansion of the economy was rapid, with output growing by 10.4 percent in 1934 and 8.6 percent in 1935. This allowed for high levels of employment: the number of people working increased by 8.5 percent between 1934 and 1935, and unemployment fell to almost zero.
A considerable portion of the growth was attributed to military spending. This included investments in new technology and infrastructure, but also machines and workforce necessary to produce armaments. Even when military expenditure was reduced due to the close of the civil war in Spain in 1938, growth continued in the private sector, including production of consumer goods.
Perspectives from experts
Though the recovery of the German economy under Hitler was undeniable, there is disagreement amongst experts as to how much of an impact the Nazi leader had. According to economic historian Emilio Gentile, the economic revival in Germany was merely a continuation of the ongoing recovery that began during the Weimar Republic — the period preceding Hitler’s rule — and was not as a result of any specific Nazi policies.
Similarly, historian Richard Overy suggested that much of the rapid expansion of military production and subsequent economic growth during this period was due to technological developments that had begun in the Weimar period, as well as prime minister Heinrich Brüning’s economic policies.
Insights and analysis
It is clear that the German economy did recover during the Nazi period. However, the extent to which this was due to Hitler’s policies, or merely because of pre-existing economic trends, is open to debate.
It is likely that Germany’s economy would have benefited from any democratically elected leader in the same period, from 1933 onwards. Economic historian Barry Eichengreen explicates that this recovery was contingent on there being a ‘lasting peace’ in Europe and a ‘hodgepodge of recovery programs’, with Adolf Hitler taking on a role as ‘the rhetorician of recovery’.
It can be argued that Hitler’s anti-capitalist policies hindered the extent to which the recovery could have flourished. In 1936, Hitler was responsible for introducing a Four Year Plan that aimed to rearm Germany and make it self-sufficient. This involved the nationalization of industry and the introduction of price controls. As a result, companies were discouraged from investing in long-term projects and innovation, while further economic downturns began to be felt by 1932.
Innovation and potential
Though some of the Nazi policies had a negative effect on the growth of the economy, it is undeniable that there were some improvements made. For instance, the increased presence of women in the workforce was a result of Nazi policies, with the number of women working increasing from 6 million in 1933 to 8 million in 1939.
The Nazis also improved working conditions for some groups by introducing systems for occupational accidents insurance and health insurance for manual workers. These almost certainly contributed to the rapid economic recovery during this period.
In terms of technological innovation, improved road infrastructure, technological developments and the introduction of the Volkswagen were a few of the many direct investments that had a positive effect on the economy during this period.
Economic stagnation
Despite the ‘remarkable’ and ‘spectacular’ growth in the initial years of Hitler’s rule, the economy began to stagnate in 1938. At the same time, Hitler began to concentrate more on his military ambitions and subsequent war efforts, which directed German resources away from the domestic economy.
The introduction of a Four Year Plan also saw a shift away from civilian consumption and investment in long-term projects, leading to further stagnation in the economy. By 1939, the same year Germany invaded Poland, economic growth slowed to 6.7 percent.
Economy in wartime
When wartime economies are taken into account, it becomes clear that the German economy under Hitler’s rule was far from successful. During the years of 1939 to 1945, the economy shrank by 10 percent — the number of people working decreased by 20 percent — while inflation reached record levels.
This was largely due to the military expenditure and the demand for consumer goods and resources, as well as the war damages caused by Allied bombings towards the end of the war.
Effect of policies on growth
Though the economic recovery during Hitler’s rule was undeniable, his economic policies were not conducive to economic growth. These policies discouraged companies from investing in long-term projects, meaning that the recovery was only short-term.
Wartime policies and the increased presence of women in the workforce may have been beneficial to some, but ultimately these had a negative effect on the overall growth.
Conclusion – did Hitler improve the economy?
Hitler’s rule saw a period of economic recovery in Germany, but this was largely attributed to the technological developments made and the policies implemented during the Weimar period.
The extent to which his policies improved the German economy is highly questionable — while some of his policies such as increased presence of women in the workforce and improved working conditions may have been beneficial, his reliance on military expenditure, focus on rearmament and the introduction of a Four Year Plan ultimately hindered the potential for economic recovery.
