Analyzing the Economic Consequences of Nazi Germany's Foreign Policy (1933-39)
TITLE
Assess the impact of foreign policy on the economy in Nazi Germany in the period 1933–39.
ESSAY
The impact of foreign policy on the economy in Nazi Germany during the period 1933–1939 was profound and intricate. Adolf Hitler and the Nazi regime utilized foreign policy as a tool to achieve their geopolitical aims, overturn the restrictions of the Treaty of Versailles, and resurrect Germany as a powerful European nation. The alignment between foreign policy objectives and economic policies was fundamental in guiding the economic development of the country.
At the outset of Hitler's rule, foreign policy was intricately connected to economic recovery. Strategies such as the New Plan, spearheaded by Hjalmar Schacht, aimed to restore trade relations with other countries to boost the German economy. International agreements such as the Treaty with Poland in 1934 and the Anglo-German naval agreement further facilitated trade relationships and investments in Germany. These diplomatic efforts provided a conducive environment for economic growth as Germany recovered from the global economic downturn.
However, as the Nazi regime solidified its power and adopted a more aggressive foreign policy stance, the economy became increasingly militarized. The pursuit of territorial expansion through actions like the Anschluss, annexation of the Sudetenland, and invasion of Poland in 1939 required significant rearmament efforts, which reshaped economic policies. The shift from Schacht's orthodox economic approach to the more stringent Four-Year Plan highlighted the prioritization of military buildup over civilian needs.
The Nazi-Soviet Pact also had economic implications, offering Germany a brief respite from the need for full economic self-sufficiency. However, the mounting pressures of wartime production and the drive for conquest underscored the interdependence between foreign policy and economic sustainability. The regime's focus on conquest for economic gains was unsustainable in the long term, leading to labor shortages, inflationary pressures, and overstrained resources within Germany.
Moreover, while foreign policy played a significant role in shaping the economy, other domestic factors such as social spending, infrastructure development, anti-Semitic measures, and labor policies also influenced economic conditions. The exclusion of women from certain sectors of the economy, suppression of trade unions, and anti-Semitic policies had profound effects on the labor market and industrial productivity.
In conclusion, the relationship between foreign policy and the economy in Nazi Germany during the period 1933–1939 was complex and intertwined. Hitler's aggressive pursuit of territorial expansion and rearmament significantly shaped economic policies, leading to a militarized economy geared towards war. The unsustainable reliance on conquest for economic advancement ultimately contributed to the regime's downfall. Foreign policy decisions were central to the economic trajectory of Nazi Germany, but they were also influenced by and interacted with various domestic factors that impacted the economy.
SUBJECT
HISTORY
PAPER
A LEVEL
NOTES
Assess the impact of foreign policy on the economy in Nazi Germany in the period 1933–39.
Foreign policy had a consistent and clearly expressed aim of overturning the restrictions of the Treaty of Versailles and ensuring that Germany resumed its status as a great European power. The conduct of foreign policy changed from traditional diplomacy to a more aggressive and threatening form, with the geopolitical aim of achieving living space for a new racial state. All of this depended on rearming and preparation for self-sufficiency.
The example of the First World War had shown that dependence on resources from outside the Reich had made Germany vulnerable to blockades. Economic weaknesses had undermined the military effort and made foreign policy aims unrealizable. Thus, in Hitler’s mind, foreign policy aims and the means to achieve them were inextricably linked to economic policy.
In the more orthodox phase of economic policy, foreign policy was linked to the recovery of trade – hence in the New Plan, Schacht aimed to develop reciprocal trade agreements. Reassuring foreign policy moves like the Treaty with Poland in 1934 and the Anglo-German naval agreement helped to develop a context in which trading links and investments could grow.
As the world economy recovered and with some help from government public works, the German economy recovered, especially in terms of employment aided by a foreign policy that was clear in its aims but did not seem too far removed from that of the late 1920s, except for the withdrawal from the League of Nations. Hitler did not try to invade Austria in 1934 and was not supportive of Japanese expansion.
However, as the regime established itself, a more aggressive foreign policy required greater moves to rearm. Schacht’s orthodoxy was replaced by the Four-Year Plan, and with little chance that foreign powers would stop rearmament, German industry pushed forward. There were more restrictions on prices, wages, imports, and the allocation of raw materials. The economy was geared more towards war as foreign policy made that more likely with the Anschluss and the annexation of the Sudetenland in 1938 and the acquisition of Bohemia and Moravia in 1939 and the invasion of Poland.
The economic benefits of the Nazi-Soviet pact might be considered. While full autarky was not possible, there was greater self-sufficiency but also problems such as labor shortages, some overheating, and inflationary pressures. It was unlikely that economic development, which was so geared to serve foreign policy ends, could be sustained without gains from foreign conquests. In a sense, the economy was having an impact on foreign policy as well as vice versa.
Some may argue that foreign policy was not the only element to have an impact on the economy but that increases in social spending and infrastructure, the removal of women from elements of the workplace, anti-Semitic measures, the ending of the influence of trade unions, and the recovery of world trade had an impact independent of foreign policy and the attendant rearmament.