World War II: Economics--The German Gro▀raum


Figure 1.--Hitler's diplomatic and military succeses created the Gro▀raum that he had only dreamed of in 'Mein Kampf' two decades earlier. He controlled by 1941 an economic area greater than that of the United States. Despite the phenomenal success, however, there were serious problems, many revolving around raw materials -- especially energy. Here we see Mussolini in Munich being seen off by a Hitler Youth BDM girl after Hitler forced the British and French to abandon Czechoslovakia by threatening war (September 1938). Italy for example when it later declared war on Britain had its coal supplies cut off and Germany had to supply its ally from already tight domestic supplies. After the fall of France (May 1940), Germany had to supply even larger quantities of coal to France which had also previously obtained coal from Britain. The dilemma for Hitler was if he did not dip into the Reich's limited energy supplies, the economies of the allied and occupied countries would grind to a standstill and could not be exploited. While Hitler managed to expand the Reich's war econony, overall production in the German Gro▀raum declined, placing serious limits on the German war economy.

A fundamental principle of geopolitics is the principle of the Gro▀raum (Great Area). [Schmitt] The idea was formulated by a strategic German thinker in the 19th century. He saw the Gro▀raum as the foundation of the science of international law and international relations. A Grossraum is an area dominated by a central power representing a distinct political idea. This idea appears to have always been formulated with a specific opponent in mind. Hitler had several enemies in mind, some of which had not yet formulated, a Gro▀raum. Hitler like President Putin today was heavily influenced by the idea of a Gro▀raum. Hitler knew very well that the Germany he comtrolled in 1939 was not an over-powering Gro▀raum. That is why he pressed for an early militay action while Germany still had the advantage achieved by his rapid rermamet program. The victory in the West provided Hitler what he had longed for in Mein Kampf, a strategic base approaching a Gro▀raum (1940). As a result of his victory in the West, Hitler not only conquered France along with the Netherlands and Belgium, but now was able to force much of the rest of Europe to throw in their lot with him. The Finns out of fear of the Soviets made common cause. The Swedes and Swiss remained neutral, but guaranteed to the Germans that they would maintain trade contacs and were esentially absorbed within the economic sphere of the German Gro▀raum. Swedish iron ore was vital. The Romanians uderstanding the Germans were now the masters of Europe reoritened their trade with Germany, especially their vital oil exports. The Gro▀raum which Hiter had constucted by 1941 was one of the great powers, in sharp contrast to the Germany he seized controlof in 1933. It had a larger population than Britain (even with the Dominions), the United States, Japan, or the Soviet Union and it now had a larger econony than America with which to conduct the War. [Tooze, p.384.] There were, however, serious weaknesses in Hitler's new Gro▀raum. It was not still not self-sufficient in iron ore and mamy other strategic raw materials including cobalt, copper, titanium and other metals. By far, however, the most serious problem was energy (oil and coal). And while seizing French stocks brought a temoprary respite, German sucesses actually worsened the German energy situation (coal and oil) It might be thought that the Germans could just seize the energy from the occupied countrues, which they did to an extent. But this was woyld have brought the occupied economies to a standstill which would have meant there would have been been nothing to exploit. The problem for the Germans as that the occupied and associated countries (Italy, Sweden, and Switzerland) were net energy importers (both coal and oil). Coal at the time was the primary industrial and home heating fuel. Sweden wihout the coal which had been obtained from Britain would have no way of transporing iron ore to Germany unless the Germans furnished the coal. France produced coal, but 40 percent of its coal supply had to be imported, mostly from Britain before the war. And we are not talking about small amounts. Austria, Denmark, Italy, Normay, Sweden, and Switzerland all imported over half of their coal, in some cases 100 percent. [Lewis, p. 116.] And most of that imported coal came from Britain. So if the economies of these nations were to function, the Germans had to supply coal from their already tight supplies. Limited energy supplies meant that the ecinomies of the occupied countries declined preciptously. As a result, the Germans could not exploit the productive potential of the occupied countries as they had hoped. Hitler used the French to support his war effort, but to so so, he had to supply the French with coal. His policies and attitudes toward Vichy and the French as well as limited energy supplies prevented the NAZIs from fully harnessing the French economy.) There was an even more serious defecit in oil. So rather than solving the Reich's serious enrgy probelm, the great successes in the West actully made the situation worse. The Germans were forced to actually increase energy exports. This is in sharp contrast to the Anglo-American situation which some authors describe as sailing to victory on a sea of oil. And while the economy of the NAZI Gro▀raum declined, the Anglo-American economies boomed. And Hitler's energy it explains why Hitler was so dependent on Soviet shipments and why he decided to take the momentous step of invading the Soviet Union. There is considerable evidence that Hitler assumed that the campaign in the East would be another short summer campaign after which he could begin what he called the 'War against continents'. It would be the German Gro▀raum bustressed by the resources of the East against the Anglo-American Gro▀raum.

Gro▀raum Theory

A fundamental principle of geopolitics is the principle of the Gro▀raum (Great Area). [Schmitt] The idea was formulated by a strategic German thinker in the 19th century. He saw the Gro▀raum as the foundation of the science of international law and international relations. A Grossraum is an area dominated by a central power representing a distinct political idea. This idea appears to have always been formulated with a specific opponent in mind. Hitler had several enemies in mind, some of which had not yet formulated, a Gro▀raum. Hitler like President Putin today was heavily influenced by the idea of a Gro▀raum. Hitler on many occassiins enviously discussed America's continental power base. This is what he fervently desired for Germany. And the only way of achieving them was war--aggressive territorial expansion. Hitlerĺs Gro▀raum theories were enhanced by his contact with his geopolitical mentor Karl Haushofer. Rudolf Hess had been his student and introuced Hitler to him. Haushoferĺs was a propent of Gro▀raum theory and strongly promoted the idea that Germany must control the Eurasian Heartland to attain world domination. [Derwent] Whole pages of 'Mein Kampf' could have been written by Haushofer. Haushofer would pay dearly for his association with Hitler. Haushofer was a strident German nationalist, but did not connect German nationalism with racial docrine. His wife had Jewish relatives and after the Nuremberg Race Laws were issued was designated a Jewish Mischling. Hess protected them for years. After Hess' flight to Britain, however, suspicion fell on the Haushofers. His son Albrecht was arested after the July Bomb plot. And along with Klaus Bonhoeffer, Albrecht was shot by the SS in the final months of the War. Haushofer and his wife committed suiside after the War.

NAZI Gro▀raum Economy

Hitler knew very well that the Germany he controlled in 1939 was not an over-powering Gro▀raum. That is why he pressed for an early militay action while Germany still had the advantage achieved by his rapid rermamet program. The victory in the West provided Hitler what he had longed for in Mein Kampf, a strategic base approaching a Gro▀raum (1940). As a result of his victory in the West, Hitler not only conquered France along with the Netherlands and Belgium, but now was able to force much of the rest of Europe to throw in their lot with him. The Finns out of fear of the Soviets made common cause. The Swedes and Swiss remained neutral, but guaranteed to the Germans that they would maintain trade contacs and were esentially absorbed within the economic sphere of the German Gro▀raum. Swedish iron ore was vital. The Romanians uderstanding the Germans were now the masters of Europe reoritened their trade with Germany, especially their vital oil exports. The Gro▀raum which Hiter had constucted by 1941 was one of the great powers, in sharp contrast to the Germany he seized controlof in 1933. It had a larger population than Britain (even with the Dominions), the United States, Japan, or the Soviet Union. And Hitler now commanded a larger econony than America with which to conduct the War. [Tooze, p.384.] But this was only the case if he could maintin the economic activity of the occupied countries and associated neutrals at pre-War levels. As it turned out, he could not. This was in part because of NAZI policies including seizing control of financial institutions and assetts, killing productive workers, worker round ups, inadequate diets, slave labor, explotitive economic policies, manipulating exchange rates, ect. There was also the basic problem of energy shortges which significantly imparied economic activity. Germany had coal, but not enough and virtually no oil. Romania provided important quantities of oul, but again not enough for even German needs. Most of the occupied countries and associated neutrals had even greater energy defecits than Germany. This meant that the NAZI Gro▀raum, had a greater energy defecit after the gret NAZI victories. Thus to keep the economy of the Gro▀raum functioning, Germany actually had to export energy out of its inadequate resources. It could not, however, begin to provide the quantity of energy needed. Thus economic activity declined measurably throughout the Gro▀raum at a time in which the NAZI war effort desperately needed vastly increased production to cope with the massive output of America, the British Empire, and the Soviet Union which was rapidly brining its industrial plants moved beyond the Urals on line.

Raw Material Shortages

There were, however, serious weaknesses in Hitler's new Gro▀raum. It was not still not self-sufficient in iron ore and mamy other strategic raw materials including cobalt, copper, titanium and other metals. By far, however, the most serious problem was energy (oil and coal). And while seizing French stocks brought a temoprary respite, German sucesses actually worsened the German energy situation (coal and oil). Strtegic materials played a critical role in World War II, in both the desire to launch the War and in the ability to wage an etended conflict. Acquiring natural resources was a major war aim of Germany and the other Axis powers. Only one country at the outbreak of World War II had the industrial and agricultural capacity as well as the resource base to wage world war and that was the United states which had no desire to participsate in another world war. The Soviet Union had significantly expanded the Russian indutrial base, but weakened the country's agricultural productivity through enducung the Ukranian famine and collectivzing agriculture. Like the United States, the Soviets posessed enormous natural resources and like Germany, they had designs on neigboring countries. Britain was less well situated. It had a substantial industrial and scientific base, but except for coal and iron, limited natural resources. And it had to import large quantities of food. Those resources, however, existed in the Empire and overseas trading partners like America.

NAZI Dilema

It might be thought that the Germans could just seize the energy from the occupied countrues, which they did to an extent. But this was woyld have brought the occupied economies to a standstill which would have meant there would have been been nothing to exploit. The problem for the Germans as that the occupied and associated countries (Italy, Sweden, and Switzerland) were net energy importers (both coal and oil). Coal at the time was the primary industrial and home heating fuel. Sweden wihout the coal which had been obtained from Britain would have no way of transporing iron ore to Germany unless the Germans furnished the coal. France produced coal, but 40 percent of its coal supply had to be imported, mostly from Britain before the war. And we are not talking about small amounts. Austria, Denmark, Italy, Normay, Sweden, and Switzerland all imported over half of their coal, in some cases 100 percent. [Lewis, p. 116.] And most of that imported coal came from Britain. So if the economies of these nations were to function, the Germans had to supply coal from their already tight supplies. Limited energy supplies meant that the ecinomies of the occupied countries declined preciptously. As a result, the Germans could not exploit the productive potential of the occupied countries as they had hoped.

France

France was vital to Hitler. Hitler used the French to support his war effort. It was the single most important country in the German war economy. Stalin's alliance with Hitler had made the German conquest of France possible. Ironically, NAZI possession of France was in turn vital in making Barbarossa possible. But to exploit the French economy, he had to supply the French with coal. His policies and attitudes toward Vichy and the French as well as limited energy supplies prevented the NAZIs from fully harnessing the French economy. France had an even more serious defecit in oil. It oroduced coal, but virtually no oil. So rather than solving the Reich's serious enrgy problem, the great successes in the West actually made the situation worse. Rather than gaining new energy sources, ironically the energy-poor Germans were forced to actually increase energy exports.

War Against Continents

Hitler sas not satisfied with a war in Europe. He began dreaming about what he called a 'war against continents'. His energy nd other raw material limitations were a constant problen for the German war economy. This is in sharp contrast to the Anglo-American situation which some authors describe as sailing to victory on a sea of oil. Too often authors focus narrowly on German war production. It did increase until late-1944, but the economy of Hitler's Gro▀raum which supported it declined. This is important because to defeat Britakin, the Soviet Union, and America, Hitler needed a much larger economy than that of the Reich, but as the economy of the Gro▀raum declined, his chances for victory slipped frim his grasp. And while the economy of the NAZI Gro▀raum declined, the Anglo-American economies boomed. Hitler's energy shortages explain why he was so dependent on Soviet shipments and why he decided to take the momentous step of invading the Soviet Union to seize those resources rather than remaining dependent in Stalin's good will. Hitler assured his military and civilian planners that the campaign in the East would be another short summer campaign. And then with the resources of the East. Hitler believed that he could begin what he called the 'War against continents'. It would be the German Gro▀raum bustressed by the resources of the East against the Anglo-American Gro▀raum.

Sources

Derwent, Whittlesey. German Strategy for World Conquest (Farrar and Rinehart: New York, 1942).

Lewis, C. Nazi Europe and World Trade (Washington: 1941).

Schmitt, Carl. V÷lkerrechtlishe Grossraumordnung mit Interventionsverbot fŘr Raumfremde Mńchte.

Tooze, Adam. The Wages if Destruction: The Making and Breaking of the Nai Economy (Penguin Group: New York, 2007), 800p. Tooze provides a detiled table of national economies compiled from various sources.







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Created: 7:49 AM 5/14/2016
Last updated: 8:06 PM 9/9/2016