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

by Adam Tooze

June 1935 until the spring of 1938, steady growth in exports was vital to sustaining the momentum of Hitler’s economic recovery. Exports did not return to their pre-Depression levels. Nor were they enough to provide the Reichsbank with more than a bare minimum of comfort. But they did permit a steady increase in the volume of imports from the absolute trough reached in the summer of 1935. If we consider the extraordinarily small quantity of foreign exchange and gold at the Reichsbank’s disposal and the difficulty of obtaining credit, the volume of import and export business that Nazi Germany was able to conduct under the New Plan was truly remarkable. Under modern conditions of uninhibited free trade and international lending, the IMF advises central banks to hold precautionary reserves equivalent to six months of imports. The elaborate apparatus of Schacht’s New Plan allowed the Reichsbank to sustain the international trade of one of the world’s largest and most sophisticated economies with foreign currency reserves amounting in the mid-1930s to little more than one week’s cover. To say the least, this was a remarkable organizational achievement.