The economic recovery Flashcards

1
Q

Hitler was careful not to become tied down to the details of what policies?

A

Economic policy

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2
Q

In February 1933, what did Hitler tell his cabinet in reference to economic policy?

A

‘avoid all detailed statements concerning an economic programme of the government’

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3
Q

Hitler was politically astute enough to realise that the survival of the dictatorship depended on what ?

A

Bringing Germany out of depression

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4
Q

At first, the Nazi economic policy was under the control of who?

A

Hjalmar Schacht

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5
Q

Why was the Nazi economic policy at first under Schacht?

A

The Nazi leadership still needed to work with the economic elites

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6
Q

Schacht was already what?

A

A respected international financier because of his leading role in the creation of the Rentenmark

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7
Q

Was there a single, easy quick fix solution to the economic problems?

A

No

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8
Q

The heart of recovery lay in the what and led by who?

A

In the major revival of public investment led, by the most part, by the state itself

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9
Q

What did the state embark on?

A

A large-scale increase in its own spending in an effort to stimulate demand and raise national income

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10
Q

Under Schacht’s guidance and influence, what was adopted through a range of economic measures?

A

Deficit financing

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11
Q

Initially, why did the state increasingly assume greater responsibility for the control of capital within the economy?

A

Because the German banking system had been so fundamentally weakened

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12
Q

What did the state proceed to do to interest rates and debts of local authorities?

A

Set interest rates at a lower level
Reschedule the large-scale debts of local authorities

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13
Q

Why were particular financial benefits given to businesses?

A

To stimulate economic growth and also to reward some of the most sympathetic supporters of the Nazis in the election

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14
Q

What were some of the measures given for assistance for farming and small businesses?

A

Maintenance of tariffs on imported produce to protect German farmers
Subsidies from Reich Food Estate in a nationally planned agricultural system
Reich Entailed Farm Law, tried to offer more security of land ownership to small farmers: debts reduced by tax concessions and lower interest rates
Allowances to encourage the rehiring of domestic servants
Allocation of grants for house repairs

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15
Q

What was renewed in June 1933?

A

Law to Reduce Unemployment

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16
Q

Law to Reduce Unemployment was a scheme originally started by who, and when?

A

Papen in 1932

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17
Q

The RAD was extended to what?

A

To employ 19-25 year olds

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18
Q

Give examples of the state and their range of investment projects.

A

RAD extended employment
Renewal and expansion of the Law to Reduce Unemployment

19
Q

For a long time most historians believed what was the main focus of investment?

A

Rearmament

20
Q

Figures for public expenditure show that the main focus of investment was initially spread between what?

A

Rearmament
Construction
Transportation

21
Q

Investment in the first three years was directed towards what? And give examples

A

Work creation schemes
e.g.
Reforestation
Land reclamation
Road improvement
(e.g. motorways)
Expansion of the housing sector and public buildings

22
Q

The cumulative effect of these policies was to what ?

A

Triple public investment between 1933 to 1936 and to increase government expenditure by nearly 70%

23
Q

How was the economic recovery by 1936?

A

Well advanced

24
Q

After 1936, the emphasis began to turn towards what?

A

Rearmament

25
Q

How many people were unemployed in January 1932?

A

6 million

26
Q

How many people were unemployed in 1936?

A

2.1 million

27
Q

Why, even by 1936,did government public deficit not run out of control?

A

Schacht maintained taxes at a relatively high level and encouraged private savings in state savings banks

28
Q

What foreign factors positively effected the German economy?

A

All of it took place as the world economy began to recover
Aided by the natural upturn from the low point of winter 1932

29
Q

What two underlying worries were there despite the impressive economic recovery?

A

Rapid increase in demand would rekindle inflation
Lead to a balance of trade deficit

30
Q

Why did the problem of inflation never materialise?

A

Lack of demand in the economy
Regime established strict controls over prices and wages

31
Q

What helped the regime establish strict controls over prices and wages?

A

Abolition of the trade unions

32
Q

Explain the recurring problem with the balance of payments which first appeared in the summer of 1934

A

Consequence of Germany’s importing more raw materials while failing to increase exports
Gold and foreign currency reserves = low

33
Q

The early economics minister, Schmitt, wanted to reduce unemployment further by what?

A

By manufacturing more consumer goods
But powerful voices in armed forces and big businesses were already demanding more resources for major programmes, e.g. rearmament

34
Q

Why was Schmitt’s policy consequently rejected and he removed?

A

Hitler couldn’t ignore such pressure, esp. as economic problem coincided w/ pol. dilemma over SA

35
Q

What did Schmitt’s removal allow Schacht to do?

A

Combine the offices of minister of economics and president of the Reichsbank

36
Q

By the law of 3rd of July Schacht was given what?

A

Dictatorial powers over the economy

37
Q

Schacht used his new powers over the economy to introduce what?

A

The ‘New Plan’ of September 1934

38
Q

What did the ‘New Plan’ of September 1934 provide?

A

A comprehensive gov. control of all aspects of trade, tariffs, capital and currency exchange in attempt to prevent excessive imports.
Gov. decided which imports were allowed or prohibited

39
Q

The economic priorities were set by what series of measures?

A

Trade treaties
Reichsmark currency
Mefo Bills

40
Q

Explain trade treaties

A

Tried to promote trade & save foreign exchange by signing bilateral trade treaties, esp. w/ south-east Europe
Took form of straightforward barter agreements
In this way, Germany exerted eco. influence over the Balkans long before it obtained military and pol. control

41
Q

Explain the Reichsmark currency

A

Germany purchased raw materials from countries it traded w/ on condition that Reichsmarchs could only be used to buy back German goods
(at 1 time = est. Reichsmarch had 238 diff. values depending on country and circumstances)

42
Q

Explain Mefo bills

A

Mefo = special gov. bills designed by Schacht
Issued by Reichsbank and guaranteed by gov. as payment for goods, deferred for up to 5 years, earning 4% interest per annum
Main purpose was that they successfully disguised gov. spending

43
Q

Was Schacht an official member of the Nazi party?

A

No

44
Q

By mid 1936 what happened to unemployment, industrial production and GNP

A

Unemployment fallen to 1.5 million
Industrial production increased by 60% since 1933
Gross National Product grown over the same period by 40%