>
> Isn't it said that wartime governments pursue policies that compress
> the income distribution?
This is a short section from my book: Transcending the Economy
Lessons from Germany on Inequality and War A recent collection of essays, comparing the experience of London, Paris, and Berlin during World War I, suggests that, at least in part, Germany lost that war because the German government was less able than either France or Britain to persuade its people that it was acting fairly (see Winter and Robert 1997; especially, Bonzon 1997, p. 302; and Triebel 1997). For example, Thierry Bonzon and Belinda Davis wrote that it was:
... the unequal distribution of deprivation more than the deprivation itself that annoyed people the most. In all three cities the feeling of unequal access to food, of a growing gap between the excluded majority and a privileged few set a limit on the acceptance of sacrifices endured by individuals, families, and social groups for the sake of victory ....
Despite social tensions in London and Paris which should not be ignored (and which largely contributed to the 'mobilization' of public powers on these questions), these two objectives were met. In Berlin both were unreachable ....
The development of the black market in Berlin was no doubt the most visible symbol of the contrast between lived experience in the German capital and that on the other side of the line. Corruption existed everywhere, but only in Berlin did it emerge into a way of life, highlighting the extreme inequality of access to food in the German capital ....
More than the blockade or the successive bad harvests, the disorganization of the market and modes of distribution (blamed perhaps unfairly on shopkeepers and middlemen), the unequal distribution of essential foods within Berlin society, the link between the access for the most fortunate to the black market and the exorbitant price paid by the majority to obtain no more than reduced rations, all these fuelled public anger and public demand for urgent action by the state. (Bonzon and Davis 1997, pp. 340?41) Gabriel Kolko, a renowned professor of history at York University in Toronto, noted that German workers did not recover their 1913 level of wages until 1928. The Nazis realized that they could not pursue their program of military conquest, if they repeated the mistakes of World War I and undermined social solidarity by intensifying inequality. In Kolko's words: "Forced to choose, the Nazis ... preferred to risk depriving the war effort to possibly alienating the workers and seeing them driven once again to political action in various forms, including slowdowns and sabotage." So, in World War II, Hitler protected wages. As a result, "Real weekly income in Germany grew dramatically from 1932 to 1941, and even in 1944 it was only slightly less than it had been at its peak 1941" (Kolko 1990, p. xvii).
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Michael Perelman Economics Department California State University Chico, CA 95929
Tel. 530-898-5321 E-Mail michael at ecst.csuchico.edu