Forum: history.stackexchange.com
Tags: <world-war-two><nazi-germany><economy><ww2-european-theater>
Title: How did Nazi Germany finance itself during WW2?
Question: How did Nazi Germany finance itself during the war? They produced a large amount of war material during 1939-1945, but how was this production financed? What were Germany's revenue streams that enabled them to purchase and transport the raw materials of war and pay the workers? I doubt they were exporting goods during the war, so any revenue was likely internal to the country. Given the Depression was still going on in 1939, how did they pay for the war?

Answers:
sents: text: I think the Great Depression was quite irrelevant for Germany in 1939 similarly to for other countries that took measures at state regulation.
text: As for the income, Germany was a well-developed industrial country with advanced technology.
text: It was a pioneering country at chemistry, electrical engineering, machine-tool construction, railroads and transportation, metallurgy and mining.
text: Its industry was known for exceptional quality.
text: Germany had extensive exports, which did not stop throughout the war mostly through the neutral countries.
text: With the German conquests German firms earned numerous advantages that maximized their income: They replaced or adsorbed the local businesses in many occupied countries
text: They earned the ability to use cheap forced labour of the conquered peoples Also prior to the war any strikes were outlawed in Germany so that the firms could operate without risking with workers' protests.
answer_details: author: history.stackexchange.com/users/466/Anixx
score: 39
sents: text: The recent book Hitler's Beneficiaries: Plunder, Racial War, and the Nazi Welfare State by Götz Aly offers a new and very important look at this question.
text: It is the subject of an ongoing academic debate but many of the factual findings seem to be indisputable, if I understand correctly (haven't read it but read very detailed reviews).
text: Very brief summary: The Nazis borrowed prodigious sums to finance the re-armament of Germany, the Autobahns and the social benefits the Germans received. "
text: Fortunately", at the very moment the chips were due to fall and they would have had to face insolvency, they started the war and turned it into a great expopriation scheme.
text: That the Nazis looted all Europe and made it pay and work for the war machine is quite well-known; Ali goes into great detail showing the mechanics of the process and showing that the German was effort was to a large degree a financial pyramid, where the conquered countries and the murdered Jews were looted to pay off the deficits the Nazis had kept accruing.
text: He posits that the common German people were quite aware of this, grosso modo , and claims that this partly explains the tenacity with which the Germans fought to the bitter end (a claim that may not immediately follow from his economic data, as other factors, e.g. ideology, are involved).
text: One detail for example: they herded hundreds of thousands of Russians to work as labourers, industrial workers and domestic help in Germany; they were ostensibly paid (very low) salaries - but these salaries were stashed into a fund which nobody ever saw.
text: Another example: the Germans paid for goods in the countries they conquered (at least in the East) with "occupation marks" - an artificial currency whose exchange rate they loaded heavily in their own favour.
answer_details: author: history.stackexchange.com/users/1569/Felix Goldberg
score: 30
sents: text: According to a recent study commissioned by the German Finance Ministry, looting of German Jewish wealth amounted to 120 billion reich marks and financed about 1/3 of the expenditure of the German armed forces during WWII.
text: http://www.telegraph.co.uk/news/worldnews/europe/germany/8119805/Confiscated-Jewish-wealth-helped-fund-the-German-war-effort.html
answer_details: author: history.stackexchange.com/users/6936/Josh Aller
score: 8
sents: text: Germany conquered and occupied a number of countries, and stripped them of their gold reserves (except in those instances where the countries were able to ship the gold abroad).
text: They sometimes paid in either marks, or more often, local currency, since they effectively controlled those countries' banking systems.
text: And in a pinch, they could requisition the supplies and labor that needed, basically at the point of a gun.
text: And Germany was one of the first countries to "exit" the Depression.
text: That was a major result of the rearmament program, which had a "pump priming" effect on the economy.
answer_details: author: history.stackexchange.com/users/120/Tom Au
score: 5
sents: text: Nazis got there money by kicking out the privately owned central bank.
text: (Just like the privately owned Federal Reserve Bank of USA, aka Central Bank).
text: After that Hitler printed their own money which was interest free.
text: within a few years Germany was the richest nation in the world while the rest of the nation were in a depression from the privately owned central banks greed.
answer_details: author: history.stackexchange.com/users/16659/Gray
score: 2
sents: text: Some US Bank and large US Companies funded the Germans in World War 2.
text: One of these banks,The Union Bank run by Prescott Bush owned by George Herbert Walker was seized by the U.S in 1942 for trading with the Germans.
text: Under The trading with the enemy act.
text: Mr Julius Silverstein and Mr. Gingold sued the Bush family and the United States in 2001 for profiting from the Auschwits concentration camps.
text: One of the reason the United States didn't get involved in World War 2 was because of US companys profits.
text: One company was Ford Motor Company.
answer_details: author: history.stackexchange.com/users/15279/user15279
score: 1
sents: text: I think the true answer is: money is a fiction, useful for bookkeeping, but ultimately meaningless.
text: What truly matters is control of resources, infrastructure and labor.
text: Using money is the "civilized" method of gaining that control, but if you're prepared to resort to uncivilized methods (forced labor, seizing privat property, outright conquest), you can pretty much ignore it.
text: See http://bits.blogs.nytimes.com/2014/01/27/bitcoin-and-the-fictions-of-money/ and http://www.thisamericanlife.org/radio-archives/episode/423/the-invention-of-money
answer_details: author: history.stackexchange.com/users/4127/Michael Borgwardt
score: 0
sents: text: Not sure if it's already mentioned here, but not many people know that Nazi Germany was on the verge of bankruptcy in the years 1936-1938.
text: Uncontrolled investments in weaponry, social plans plus the build up of an extensive police- and army apparatus where too much for the state, which just was coming out of the deepest recession in German history until then.
text: After 1938 this changed of course, as occupying other countries, hence robbing their gold reserves and access to massive private (mainly Jewish) capital, meant a big boost for for them.
text: And let's also not forget that Germany was financially supported by very rich Americans of German and Irish (Henry Ford!)
text: descend.
text: Although this proved to be a drop on a boiling plate.
text: German economy only SEEMED strong, but in fact was still very weak in the 30's.
text: That's why I don't agree with the answer chosen as the correct one as it's not a correct answer.
answer_details: author: history.stackexchange.com/users/12109/Mare Gaea
score: 0

Summary of the answers:
The Nazis made money from the countries they occupied. They stripped them of their gold reserves and looted Europe. Their exports still continued through neutral countries. They also borrowed huge sums from some US and private banks.
The Nazis made significant financial gains as it conquered land during the war. However, it also borrowed a lot of money and looted more from its own Jewish people. Added to this that the regime continued to export to other neutral countries, the Nazi regime was more than capable of supporting itself financially.