THE CRISIS OF WEIMAR SOCIETY

If Nazism is understood in its social context, then, although individuals and groups of activists remain important, what they are able to do depends very much on the social framework. This is strikingly demonstrated by the history of the NSDAP. Nazi ideology with its obsessive hatreds, contempt for human beings, elitism and irrationality underwent little change from its inception in 1920. In the years that followed the Nazis spouted their racism and the SA stomped around Germany, but with negligible results. Until 1930 the NSDAP remained an eccentric collection of counter-revolutionary misfits on the outer margins of politics. Yet in 1933 Hitler was made Chancellor of Germany. How could this happen?

One widespread view is that Germans were intrinsically inclined towards Nazi views such as anti-semitism. Goldhagen states: "Whatever else Germans thought about Hitler and the Nazi movement, however much they might have detested aspects of Nazism, the vast majority of them subscribed to the underlying Nazi model of Jews..."[Goldhagen] This simply cannot explain why the most overtly anti-semitic party, the NSDAP, could attract only 2.6% of the popular vote in 1928 and never won a popular mandate to rule.

Another approach suggests that social considerations played little part in the creation of the Third Reich: "In the decision-making process of 1930-1933 the primacy of politics must be placed in the foreground."[Mason] This is because, as another author puts it, Nazism involved "the decoupling of political goals from any rational and recognisable socio-economic foundations". The trouble with this is that events at the state/political level cannot be divorced from those taking place in society and the economy generally.

The decision to appoint Hitler, it is generally agreed, was arrived at by the German "elite". This included big business and the army. But accounts which rightly stress the role of the military in giving Hitler the Chancellorship, must ask what role was the army trying to fulfil, how it was financed, and what was its ideology?

The army was closely bound to capitalism at a number of levels. It was directly concerned with the arms industries like heavy engineering and chemicals. There was also a "mental alliance" between the army and industry in terms of a defence of the stability of the state and its social underpinnings. Finally there was a surprisingly high degree of individual inter-connections and crossover of personnel. All of these take us back to society in general.

Pointing out the social context of the Nazi rise to power does not mean that there was a cunning establishment conspiracy to install Hitler. Guerin over-simplifies when he writes: "At a given moment the capitalist magnates no longer use the Black Shirts or Brown Shirts merely as anti-labor militia, but launch fascism for the conquest of the state." The Beer Hall putsch had demonstrated a number of key points in this regard. Hitler had attempted to seize power believing that support would be forthcoming from the establishment. However, the fact that the putsch failed so pathetically demonstrated how wary key sectors were of Hitler's high risk strategy. Only in an extreme crisis would they dare to resort to the extreme measures proposed by Hitler. Thus, Nazism was a semi-autonomous force.

THE PROBLEMS OF GERMAN CAPITALISM

The appointment of Hitler was connected with the economic crisis. Some basic features of German development have already been explored - its dynamism combined with intense class conflict and location in a recently unified country. This led to a high level of business concentration, close cooperation with the state, and frustration with both the constraints of internal class struggle and well-established competitors. Between 1914 and 1918 this led to the explosive attempt to break through the barriers by means of imperialist war which failed and brought defeat and revolution.

One consequence was the Versailles Treaty, a settlement by imperialist victors imposed on their rival. This involved the loss of all colonies, 73% of iron and 26% of coal supplies. The reparations bill was set at œ6.6 billion which equalled 1.5 times the total GNP of Germany in 1929. While the Nazis made much of these facts, the Treaty merely added to the losses accumulated earlier. Even before the discussions at Versailles, war had reduced industrial output to just 37% of the pre-war level. This decline was greater than that of its competitors. Germany's share of world industrial production had tumbled from 16% to 8% by 1923.

In the mid-1920s the prospects improved. The 1923 hyper-inflation, while catastrophic for some, actually benefited big business which was able to wipe out its debts and buy out rivals for a song. In late 1923 the number of business insolvencies declined dramatically while capital became still more concentrated. After 1923 the economy was stabilised on the basis of a new currency, the Rentenmark. Recovery was rapid with production returning to pre-war levels by 1928. This was Germany's roaring twenties. In just one year (summer 1926 to autumn 1927) overall industrial production leapt by 50%, capital goods output by 70%!

However, beneath the surface problems remained. Growth and reparations repayments were assisted by foreign loans. Between 1924 and 1931 foreign credits amounted to 14 milliard Rentenmarks of which 11 milliard went on reparations. To service these debts there was an emphasis on external trade, which left Germany dangerously dependent on outside factors. Even in the "golden years" Germany carried a heavy balance of payments deficit.

Some sectors of industry found life easier than others. By 1927 consumer industries exceeded their pre-war output by 16%. During the war heavy industry had supplied a war machine of 13 millions soldiers. Afterwards its military market was cut by the Versailles Treaty to 100,000 troops. In 1927 heavy industrial output was still 2% below pre-war figures. In this sector economic turmoil produced concentration, extensive rationalisation and automation. Though second only in productive potential to the USA, the outcome was a modernised "leaner, fitter" industry which soon bumped up against limits of demand. For example, in 1925 steel works were producing at just 60% of capacity, and by 1930 the figure had fallen to 55%.

The German economic pattern exhibited the same basic trend as its neighbours, but it was manic depressive in its mood swings. So the roaring twenties was followed by a massive slump after October 1929. Signs of weakness in the German economy pre-dated the 1929 Wall Street crash with industrial shares falling 25% in the summer of that year. The very success of Germany's roaring twenties had been built upon "an astonishing intensification of the productive process in important key industries. In no other country, apart from the United States, were technical improvements as far reaching as in Germany." In this very process of raising productivity by an average 20%, one million jobs also disappeared. So the depression and mass unemployment were not just externally generated disasters, although the situation was obviously exacerbated by world events and the withdrawal of American loans. While global industrial production fell 29% between 1929 and 1932 Germany fared still worse. Three years after 1929 national income had fallen by 43%, industrial production was half its pre-crash level, while heavy industry once again suffered most, falling to one third of the 1928 level. Overall investment in 1932 was just one sixth of the level in 1928. The starkest evidence of the crisis was unemployment which even in the difficult years of 1919-23 had usually remained low. Unemployment statistics are notoriously dependent on methods of calculation. One estimate puts the real (as opposed to official) figure at 10 million by the end of 1932. The government reported the figure of 5.6 million, or 30% of the workforce at this time. Trade union figures tell the same story. Unemployment in the metalworkers' union averaged 4% between 1907 and 1928. In December 1932 the figure was 43% and rising.

Whatever its specific difficulties, it should be remembered that the basic trends of German economic development in the war years and 1920s broadly followed that of the world as a whole. During the World War the overall output of belligerents had fallen by one third. World trade, which grew by almost half in the decade before the war, managed only an 8.5% increase in the decade after the war. Even hyper-inflation was not a peculiarly German phenomenon. Austria saw prices rise to 14,000 times the prewar level, Hungary 23,000 and Poland 2,500,000. The 1929 crash was near universal, with falls in industrial output for the US and Poland, outpacing even Germany's drop. If the precise contours of the crisis that hit the Weimar Republic were "without precedent in the history of industrial capitalism," Germany was, nonetheless, very much part of that common process.

THE RANSOM PAID BY THE ESTABLISHMENT

Economic crisis alone is not sufficient to explain the victory of Nazism since other capitalist states suffered without following the same path. One factor was the particular character of German social relations. This is a major reason why politics in Germany did not take the British form of a "National Government" (incorporating a spectrum of politicians from Tory to renegade Labour), or the US pattern of Roosevelt's New Deal. Any solution of the economic problems could not be separated from a decisive alteration of the social balance.

The revolutionary events after November 1918 did not overthrow capitalist society, but it was only saved by a series of concessions. A substantial ransom had had to be paid. This included the establishment of the ZAG (Central Working Community) in which unions and employers had parity. Its task was to oversee the regulation of working conditions. Though short-lived, the ZAG led the way to the introduction of an 8-hour day (without loss of pay), short-time payments, full collective bargaining over working hours, sick pay, employment of war invalids and job protection. Perhaps most important of all were two laws. One legally established the Betriebsrat or works committee. In 1919 these had been the centre of the revolutionary effort to seize control of the factories, but they were now reduced to the functions of a shop stewards' committee. The second law brought state arbitration to bear on industry-wide disputes. Though all this fell far short of a social transformation it did create a bridgehead of workers' organisation into a system where the employer had, till then, regarded himself has Herr im Hause (Lord in his own house). As a result the Free Trade Unions' membership rose from 2.9 million in 1918 to 8.5 million in 1920.

The compromise of 1918/19 was regarded by the employers as temporary. They intended to withdraw it when the balance of forces moved in the right direction. The bosses could achieve a certain amount within the framework of the republic. The buffeting suffered by workers' organisations in the early 1920s saw many of the immediate post-war gains taken back. In 1923, for example, inflation was used as the excuse to abrogate the 8 hour day. However, the power of workers' organisation was not destroyed and by 1928 the majority of workers clawed back shorter hours. Union membership may have fallen, but in 1930 it still stood at 62% of its post-war peak. Under the impact of mass unemployment wages may have declined, but in 1932 they were still ahead of their pre-war level. and taking 62% of national income as compared with 46% before the war.

The ransom needed to head off revolution did not stop there. In spite of a stagnating economy a broad system of social welfare was built up. This provided benefits for sickness and accidents, and improved unemployment provision. Compared to 1913, at the end of the Weimar Republic spending in real terms on social insurance had doubled, health and welfare quadrupled and public housing expenditure rocketed 25 times. In contrast defence and the economy (roads, industrial subsidies) fell to a quarter of the 1913 level. Despite savings in these departments, overall government spending was running at twice the pre-war level at the very moment the economy crashed.

THE BALANCE OF CLASSES WITHIN THE STATE

The Weimar system included a political compromise. On the one hand, workers' political reprentatives were allowed to play their allotted role in the Reichstag. Under the constitution providing one deputy to every 60,000 voters, elections were held and the SPD was even allowed to rule for 3 out of the 14 years that the Weimar Republic existed. For the first time the government was formally accountable to the Reichstag and 15 successive coalition administrations were formed. In a country where the majority of the population were workers, and many of them radical, this represented a considerable concession from the old political groupings.

The core of the Kaiser's state had been preserved, and transferred wholesale into the Republic. Symbols are often evidence of deeper processes. The new political system "retained the name Deutsches Reich (German Empire), with its Imperial and authoritarian undertones". Its other title, the Weimar Republic, betrays the fact that it was deliberately concocted in a quiet non-industrial town far away from "red Berlin". Still more important, tucked away in the constitution was a clause (Article 48) which said: "In the event that the public order and security are seriously disturbed or endangered, the Reich president may take the measures necessary for their restoration, intervening, if necessary, with the aid of the armed forces." In context this meant that if democracy should ever threaten capitalist "order and security" the President could establish a dictatorship to defend it.

Thus the political compromise was no less strained than was the socio-economic compromise in the 1920s. One SPD leader sensed the danger when he said: "Essentially we have governed according to the old forms of our State life... I believe that the verdict of history... will be severe and bitter." Doubts about the democratic credentials of the state machine arose not only from the army but also the courts system. We have seen how Hitler was treated for his treasonous behaviour. Writing in 1922, this is how one observer described Weimar 'justice':

Virtually all of the relatively small number of assassinations of reactionaries have been atoned for through severe penalties; of the very numerous assassinations of men of the left, on the other hand, not one has been atoned... The judge, who himself belongs to the former upper classes, has an age-old familiarity with the thought that this economic order must be defended. His own position, after all rests upon it.

A comparison between those arrested after the fall of the Bavarian Soviet Republic in 1919 and the Kapp putsch is instructive. In the former case, those who escaped being murdered on the spot (2,209 in all) were given prison sentences amounting to 4,092 years. In the latter 705 charges of high treason were laid but no one was punished. Between 1919 and 1922 the right were responsible for 354 political murders, the left only 22 yet the former almost always escaped punishment. Thus, the Count who very publicly assassinated Eisner, leader of the Bavarian Soviet, was never punished for it.

Liberal historians like Bracher blame the problems of the Weimar Republic on a lack of faith in "the middle road" of politics. From this viewpoint the left is as much to blame as the right: "The trouble is not the lack of a "complete" revolution... but rather the reluctance to have a fully parliamentary regime... [T]here was the original flaw of the Weimar Republic." In circumstances of crisis and worker resistance it was impossible to achieve a smooth-running system based on consent. Therefore a stable parliamentary democracy could not be created. At the time supporters of such a system realised that it represented no more than a defeat of the initial revolutionary upsurge accompanied by concessions to a still powerful workers' movement:

Even he who supports the republican state will have to recognise the fact without ado that the German Republic was not the result of a great republican movement and of republican aspirations of broad circles of our people, but that it arose as the only possible form for the new state after the collapse at the end of the World War.