The Wages of Destruction: The Making and Breaking of the Nazi Economy

Author Tooze has truly contributed a new perspective on the German economy and Hitler's actions based on material always present in German archives, but less interesting and obvious than military efforts and racial policies. He has done us all a very great service in analyzing a plethora of somewhat mundane details and making his treatise intelligible to all. This is a well-researched and rather large tome, at times somewhat tedious, but absolutely required reading for the World War II historian. Other reviews have given the outline of this volume, but I wish to add several points that the author points out that may be especially germane to a decision on purchasing and reading this book. First, the author shows how Germany's drive to expand and Hitler's policies with respect to expansion in the East were the logicial continuation of German expansion from the 19th and early 20th centuries. In some respect it actually goes back to the 13th century, but that is another story. Nonetheless, this expansion was similar to and could be understood by the other imperial powers; Britain, France, the Netherlands, and Italy. By the time Hitler assumed power, Germany possessed no colonies (while all the other listed powers did) and many citizens, Nazi or otherwise, saw this expansion as their country's right and even obligation to spread German culture. That the lower-cultured (in German eyes) Slavs might object, was seen as a problem to be surmounted for their own good. Hitler then took this position to an extreme where the lower cultured populations were to be eliminated or assimilated. Star Trek fans will understand this as the Borgs' policy. The Germans needed the East's raw foodstuffs, oil, and other natural resources in order to become a great power. The only way to gain them was to destroy the political entities under whose control they were at the time. Ergo, the invasion and destruction of the Soviet Union was a given to have to happen sooner of later. In this respect, Hitler was not so much crazy as merely taking German policy and aspirations to their logical extreme. In many respects, Germany was not prepared for war with the major powers at any time during Hitler's fuehership. The economy was never actually put on a full wartime footing and competing organizations were granted priorities back and forth based on their success or failure in turf wars. Germany never achieved mass production of anything -- as soon as a level of production was achieved that seemed to satisfy an organization, its priority was withdrawn and some other project was pushed. Even with successful products such as certain tanks and aircraft, the Germans never stopped tinkering to make them better at the cost of being able to mass-produce them and supply standard spare parts. The result was that much of the German Wehrmacht's equipment was superior to the Allies', but they never possessed them in sufficient quantity to achieve their aim

"Wages" presents a blow by blow history of the steps that the Nazis took to prepare for war, the German war economy, and the economic collapse of the Third Reich. The book discusses topics such as employment, incomes, prices, resource allocation, war industries, imports/exports, foreign exchange, inflation, etc - all the subjects you'd expect in an economics textbook. Tooze shows that Hitler intended to fight from the word go. As soon as he was made prime minister in 1932, Hitler immediately started a military buildup, quickly setting plans to divert roughly 20% of Germany's national income into armaments. The main theme of the book, which Tooze reasserts over and over through examples is this - the Nazis could not summon the human and productive resources required for their war aims. Hitler started a World War the Germans could not win. Right from the start he was "in over his head." The German economy that Hitler inherited from the Weimar Republic contained some excess resources, in particular, millions of unemployed Germans. But Germany's overall resource position was not good enough. Hitler needed oil, rubber, iron, copper, food and other resources that he did have. Germany could not afford to import these resources because the Reichsbank did not have the foreign currency reserves. The Nazis military buildup was constantly frustrated by a lack of foreign exchange. In terms of population, natural resources, industrial capacity, even technological devices, Germany was looking at potential coalitions of enemies whose resources dwarfed German resources. Germany's productive resources were about equal to Britain's, but add in the United States, or France, or Soviet Union and the German position was relatively inferior. That's why many of Hitler's generals, his economic advisors, and his foreign policy establishment were scared stiff by the prospects of a new World War. Who should read this book? Seems to me that a reader can't fully understand this book without a college-level understanding of economics, including banking and foreign trade, currency reserves and devaluation, etc. This is especially important in understanding the economy the Reich inherited from the Republic, understanding the steps that the Nazis took (or did not take), their decisions about prices and inflation, foreign trade, production versus investment tradeoffs, etc. I'm a college professor. I deal with many of these issues in my own work. Yet I can't say I understood all of it. Let me offer one illustration of the kind of relationships a reader must comprehend: After the First World War, the victorious Allies imposed huge war reparations on Germany. But, the Germans could not pay, not really (Why not print money?). Moreover, the Americans insisted that England and France repay their own war indebtedness to America, but England and France could not pay, not really (Why not print money?). Wall Street figured out an answer. Americans lent money to German

Tom Munro's review has an excellent summary of the arguments in the book, so I shan't add to it. I would encourage students of the Second World War to buy this book. This is a rare book that looks at the war entirely from the economics perspective, resisting the temptation to discuss military matters as many were wont to do. This results in a remarkably clear picture of the homefront picture. This is important as it helps to address some of the myths of about the Second World War, especially with regards to the German economic performance vis-a-vis the other economies. These myths gave rise to puzzles that were usually not addressed. For example, if it were true that the Germans lost because they had a smaller economy than the US, the British Empire and the Soviet Union, and the Germans knew this, then why did they launch a war in the first place, not against one, but all of the great economic powers? This was usually explained unsatisfactorily by the 'irrationality' of the Nazis. As the author demonstrated, there was logic to the madness. The Nazis operated under a flawed assumption about how economics work, and believed that it was only by having a large economy that Germany could compete - and survive as a great power - against the other great powers, especially the United States. Thus, by this logic, Germany had to expand and conquer to build up its economic strength. The more likely war was to become with the US, the more Germany must throw everything into a 'do-or-die' gamble to grab enough economic resources to survive. This is not a wholly novel argument, but I have never seen it argued so clearly and backed by so much economic and historical data. The same could be said for the genocide of the Jews and other peoples by the Nazis. On the surface it seemed nothing but insane cruelty and barbarism. Yet again, Tooze demonstrated that there was logic in the madness, that once again, the Nazis, operating from their flawed picture of the world, chose a perfectly rational solution by their light. As food was one of the most critical items in shortage in the Nazi war economy, and enough must be provided for the German people, then the lesser people must be starved or killed outright. The less worthy would be killed off earlier, while the more able would be worked to death as slave labour. It was a perfectly economical solution in Nazi eyes. Finally, I found Tooze's examination of "Speer's Miracle" to be absolutely enlightening. I was under the impression that Speer's efforts after the death of Todt helped to economise the German war effort and pushed it towards greater productivity, allowing Germany to survive longer. The author showed that this was not the case, that most of the measures attributed to the productivity increase was put in place before Speer's appointment. What happened was Speer repeated the traditional pattern of Nazi war production, where much resources were at first pump into one area, then another, according to p

What does this book say that is different than what has gone before? Heaps. In recent years it has become clear that Germany lost the second world war because the Soviet Union was able to out produce them in the making of armored vehicles. Britain and the United States were able to produce huge numbers more aircraft. The conclusion has been that Hitler's gamble in invading the Soviet Union was the key behind the loss of the war. What this book suggests is that Germany had lost the war before it invaded the Soviet union and its success up to 1941 had been a lucky break. The author even suggests that Britain alone had some chance of over time developing a preponderance of military force. It also puts paid to what must be now seen as the myth of Munich. Previously it was thought that Britain and France failed to re-arm in time to fight Hitler effectively. What this book shows is that by 1940 Britain and France had armies that were superior in both numbers and equipment. Their navies were vastly superior to Germany's and their air forces at least equal. When France fell, although Britain lost its field army its air force was equivalent to the German in numbers and quality and its Navy vastly superior to anything the Germans and Italians could put to sea. More over the British were able to out produce the Germans in aircraft even prior to the German invasion of the Soviet Union. The success of the German armies in 1940 was due to the allied command failing to respond to the German strategy. If the allies had been a bit more aggressive they could have fought it out to at least a draw and Germany did not have the resources to fight anything more than a short war. The idea of blitzkrieg was an invention of allied generals seeking to rationalize their defeat rather than a meaningful analysis of what happened. The French never even fully committed their air force to the struggle and most of it was captured on the ground. The problem was that although Germany had access to the industrial plant of Northern Italy, France, Germany, Belgium and the Netherlands they were not able to use it to match either the Soviets or the British in war production. The reasons are complex but relate to the patterns of European trade and the success of the European blockade. If we take aircraft for example the French production which flowed to Germany was miniscule. France had access to manufacturing plant and supplies of bauxite but it was not able to produce. The reason was that it used to import coal from Britain for its electricity production. With the British blockade the main source of coal became Germany. However Germany was not able to increase its production sufficiently to overcome the short fall. In addition the amount of food produced in Europe fell. Previously the production of meat and dairy products in countries such as Denmark had been dependant on the import of grain and stock feed from South America. That was not available and the amount of food availab

I studied this exact topic (Veimar Germany, the rise of Hitler and then WWII) in high school and have since read extensively on WWII. I would have said I knew most of what there was to know about the subject. Very soon into this book, I realised I was mistaken. "Wages of Destruction" is a real eye opener, and makes for a far more coherent story than you may have seen in TV documentaries or been taught in school. One thing that bothered me in the usual telling of the WWII story is the motivation behind Germany's aggressive actions, which in the traditional telling of the story begins and ends with "because Hitler was insane". This is a great attempt to look at the 20th century from a German perspective and to explain the strategic logic behind many of Germany's actions during the period; the invasion of France, the treaty with the Soviets, Barbarossa, the concentration camps. All take on a different light when viewed through the lense of grand economic strategy. The writing is absolutely top notch; fluid and imminently readable. And despite the often dry subject matter, I found I truly couldn't put this book down. There are some dull passages on fiscal policy, and on the personal politics of some of the Nazis, but these often lead on to a hard hitting conclusion. The author seems a bit too keen to "shatter myths", which grates after a while. Sometimes it felt like you were intruding into a private argument between the author and some other history professor. Struggle on through these passages and you will find a thrilling story. There are few books I would call essential reading on WWII. This book is one of them. "The Forgotten Soldier" is perhaps another.