The Third Reich unemployment declined from six million in 1932 to less than a million four years later. GDP rose 102% from 1932 to 1937, the national income doubled and everyone was as busy as a bee! Dr. Schacht put the unemployed back to work by means of greatly expanded public works and the stimulation of private enterprise. Government credit was furnished by the creation of special unemployment bills, and tax relief was generously given to firms, which raised their capital expenditures and increased employment. (See William L. Shirer, ¡°The Rise and Fall of the Third Reich ¨C A History of Nazi Germany,¡± 1960, pp.258-260)
The real basis of Germany¡¯s recovery was rearmament from 1934 onward. War economy made Germany Prosperity possible through dirty tricks such as funds confiscated from the enemies of the State (mostly Jews) and others taken from blocked foreign accounts that had helped pay for Hitler¡¯s guns. There are at least five dirty tricks played by Schacht to strengthen the economy:
1. Dispossession ¨C discussed above.
2. Controlled Inflation ¨C amassed private wealth through reduced debt obligations.
3. Deferment ¨C his creation of government credit protected socially burdened debt from being exposed; set up ¡°Mefo¡± bills through Reich bank and guaranteed by the State and used to pay armament manufacturers. All German banks must accept these bills, which the Reich bank ultimately discounted. Since these bills appeared neither in the published statements of the national bank nor in the government¡¯s budget, they are hidden. By such deferment manipulations, many economic problems did not break out prematurely.
4. Sell ¨C by selling part of economic interests to financiers in foreign countries, the proceeds would stabilize domestic economy.
5. Debt repudiation ¨C default.¡¡¡¡
The German workers in the Third Reich were employed all right but they were deprived of trade unions, collective bargaining and the right to strike, they became industrial serfs, bound to their masters, the employers, much as medieval peasants had been bound to the lords of manors. (See P.263)
The Third Reich businesspersons made good profits, despite heavy red tapes and harassment. Union busting, hence low wages, had benefited them handsomely. (See P.262)
The Fascists ¡°solved¡± the economic crisis debacle by first militarization of economy and then W.W.II, this is similar to the U.S. experiences from 1929-1945. Capitalism, whether dictatorial or democratic, must rely on wars as the saviors of last resort.
The U.S. far right movement does not seem to be uniquely exceptional in engaging in militarism and war(s), although the far rightists¡¯ political form does have many options to take. If the far right group will find it is inconvenient to take the Hitler¡¯s dictatorial form, they can easily morph into democratic Fascism, namely a two-party system with each party tooting its horn for Fascism to repudiate voters from make any voting choice different from Fascism.
In fact, judged from the fact that the capital now have already deprived U.S. workers of trade unions (only 7% of private enterprise workers belong to a union, if any), collective bargaining and the right to strike (very rare these days, indeed), they have become industrial serfs even before the far right group takes formal political power. In addition, the (democratic) U.S. workers suffer even more than the German workers under Hitler¡¯s bourgeoisie dictatorship did. The Germans had jobs then, but now higher than 20% of U.S. workers either do not have jobs or are discouraged from re-applying for jobs, or have only part time or temporary jobs; the U.S. workers have stagnated wages for 30 years since the late 1970s, while the German workers had stagnated wages for only six war years.
What kinds of lessons can we draw from the comparisons?