Assess the impact of foreign policy on the economy in Nazi Germany in the period 1933–39.
Level
A Level
Year Examined
2022
Topic
European history in the interwar years, 1919–41
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Assess the impact of foreign policy on the economy in Nazi Germany in the period 1933–39.
The Impact of Foreign Policy on the Economy in Nazi Germany (1933-1939)
The Nazi regime's foreign policy, driven by an ambition to overturn the Treaty of Versailles and re-establish Germany as a European power, had a profound impact on the nation's economy. This essay will argue that while other factors contributed, foreign policy ambitions were the most significant driver of economic change in Nazi Germany between 1933 and 1939.
Hitler's foreign policy, characterized by aggression and a drive for "living space," necessitated a strong and self-sufficient economy. The experience of WWI, where reliance on foreign resources left Germany vulnerable to blockades, weighed heavily on Nazi thinking. Economic weakness, in Hitler's view, directly undermined foreign policy goals. This understanding formed the bedrock of the regime's economic policy.
Initially, under Hjalmar Schacht, economic policy focused on reviving trade through bilateral agreements. A relatively moderate foreign policy, exemplified by the Treaty with Poland (1934) and the Anglo-German Naval Agreement, facilitated this approach. These agreements, along with global economic recovery and domestic public works programs, contributed to a reduction in unemployment and economic growth.
However, the regime's increasingly aggressive foreign policy, marked by a rearmament drive, demanded a shift in economic strategy. Schacht's orthodox approach was replaced by the Four-Year Plan in 1936, prioritizing self-sufficiency and military production. With foreign powers unwilling or unable to halt German rearmament, the economy was increasingly geared towards war. Events such as the Anschluss, the annexation of the Sudetenland, and the invasion of Czechoslovakia further fueled this militarization.
The Nazi-Soviet Pact of 1939, while motivated by foreign policy considerations, also had economic implications. While full autarky remained elusive, the pact provided Germany with access to vital raw materials, mitigating the impact of potential blockades. However, the increasing focus on military production led to labor shortages, inflation, and an overheated economy. This unsustainable situation highlighted how foreign policy aims were driving the economy to a potential breaking point.
It is important to acknowledge that other factors also influenced the German economy during this period. Social spending, infrastructure projects, the removal of women from certain industries, anti-Semitic policies, and the suppression of trade unions all played a role. The global economic recovery also contributed to German economic growth. However, these factors were ultimately secondary to the overwhelming impact of foreign policy ambitions.
In conclusion, foreign policy was the most significant factor shaping the German economy between 1933 and 1939. The Nazi regime's pursuit of aggressive expansion, fueled by a desire to overturn the Treaty of Versailles, led to rearmament, economic mobilization, and ultimately an unsustainable economic model. While other factors played a role, the drive to achieve foreign policy goals ultimately underpinned and overshadowed all other economic considerations in Nazi Germany.
Bibliography
Overy, R. J. (2000). The Dictators: Hitler's Germany and Stalin's Russia. Penguin Books.
Tooze, A. (2006). The Wages of Destruction: The Making and Breaking of the Nazi Economy. Allen Lane.
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Introduction
Briefly introduce the relationship between foreign policy and the economy in Nazi Germany. State your argument - that foreign policy had a significant impact on the German economy between 1933 and 1939.
Early Years (1933-1935)
Discuss the initial focus on economic recovery and how a relatively moderate foreign policy facilitated this through trade agreements (e.g., Treaty with Poland). Analyze the role of Schacht's economic policies in this phase.
Rearmament and its Economic Consequences (1936-1938)
Explain the shift towards a more aggressive foreign policy (e.g., Rhineland, Anschluss) and its impact on the economy. Discuss the implementation of the Four-Year Plan and its effects on resource allocation, labor, and inflation. Analyze the growing importance of rearmament for the German economy.
Towards War (1939)
Examine the economic implications of the Nazi-Soviet Pact and its role in enabling German expansion. Analyze the increasing strain on the German economy due to the demands of a war economy. Consider the role of territorial expansion and resource acquisition in driving foreign policy.
Alternative Factors
Briefly acknowledge other factors influencing the German economy, such as social spending, infrastructure projects, and discriminatory policies. However, reiterate that foreign policy remained the dominant force shaping the economy during this period.
Conclusion
Summarize the key arguments and reiterate that foreign policy, particularly the drive for rearmament and expansion, had a profound and ultimately unsustainable impact on the German economy between 1933 and 1939.
Extracts from Mark Schemes
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.