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

by Adam Tooze

The generous prices paid to farmers were passed on directly to consumers, who were faced with a sharp increase in the cost of living. After years of falling prices, the official food-price index rose between 1933 and 1934 from 113.3 to 118.3. At the end of 1933, milk prices were raised by the direct intervention of the RNS to 22 Pfennigs per litre. These may seem like small changes, but one can gauge their significance when they are set against the modest budgets on which most German households coped from week to week. Furthermore, the inflation was highly unevenly distributed. One labour office in Hamburg in early 1934 reported panic buying, as consumers were faced with a 10 per cent increase in food prices in a single month. As we have seen, popular unrest about the inflation in food prices was one of the most worrying signs reported by the Gestapo in 1934. So severe were these anxieties that they seem largely to have outweighed any propaganda advantage gained in the struggle against unemployment. This extremely negative response to price increases during the economic and political crisis of 1934 had a remarkably long-lasting impact on the politics of agricultural production in the Third Reich. Thereafter the RNS faced enormous political pressure to refrain from any further price increases even if these were needed to stimulate production.