‘Commission Managment’: The Nazi Term for Public-Private Partnership and the Use of Special Advisors from Industry

I’ve already discussed the use of personnel from big business and industry in government, and the establishment of government organs as private corporations in the Third Reich in my post on Spamfish’s post on Wolin’s idea that America is now an ‘Illiberal Democracy’. Another example of this was the appointment of the industrialist Carl Krauch as general plenipotentiary for chemicals and director of the Reich Office for Economic Consolidation , a subordinate body to the Reich Ministry of Economics. The Reich Ministry of Economics was itself in practice the ‘executive organ of the Commissioner for the Four Year Plan’. Under Goring’s management the Organisation for the Four Year Plan appointment a number of business leaders, like Krauch, as general plenipotentiaries.

Krauch had been on the board of I.G. Farben from 1926. From 1933 onwards he was an adviser to the Aviation Ministry, and to Brabag, which was responsible for producing artificial fuel. Krauch initially headed the research division of the Office for Raw Materials and Stock in the Organisation of the Four Year Plan. IN this role he had the full support of I.G. Farben’s board, and could use the company’s planning staff. He also took some of the staff from I.G. Farben to work with him in the Office of the Four year Plan. He was made general plenipotentiary for chemicals in 1938. The Reich Ministry for Aviation and Economics urged him to resign from I.G. Farben and become a state official, and was willing to appoint him state secretary. Krauch turned the offer down after consulting Bosch. he retained his seat on the I.G. Farben’s board, and in 1940 was appointed head as chairman of the company’s supervisory board. Krauch’s position in the Reich ministry was honorary, and he was not officially employed by them, nor was he included in the organisation’s budget. He was regarded with suspicion by other firms because of his continued links with I.G. Farben, and by the state economic bureaucracy, which was used to the strict separation of public and private organisations. The use of expert technicians like Krauch was expanded and became increasingly typical. While Goring and the General Council of the Four Year Plan were responsible for the ministry’s decisions, these were strongly influenced by the suggestions of their plenipotentiaries and by members of staff from the private armaments industry. These were ultimately responsible to the Armaments Ministry, but the ministry’s central administration rarely rejected their suggestions. Krauch described this adoption of managers from private industry in government as the assumption of state duties by the independent sector of the economy. It was described by other political theorists as a new form of ‘Commission Management’. In addition to using advisors and personnel from the Nazi party bureaucracy, the management apparatus of official from private industry was also used at the expense of a uniform state administration. The parallels here between the Nazi use of managers and technicians from private industry, and their use, along with Special Advisors, by contemporary British administrations since Margaret Thatcher as part of an ideology of Public-Private Partnerships are very strong indeed.

The Friends of the Reichsfuhrrer SS

Private industry also sponsored the SS. The Friends of the Reichsfuhrer SS was a group of heads of industry and bankers in Berlin. They donated money and even equipped whole SS units. AS a reward, the group became honorary members of the SS and influential personal contact with its leader, Himmler. One of the advantages this gave the group’s members was access to cheap labour from the concentration camps. To use this slave labour, the SS demanded a price of 6 marks per man per day.

Clearly there is no real comparison between Cameron’s policies and the Friends of the Reichsfuhrer SS, except in the most general sense of private industry donating money to the Conservatives, and other political parties, such as New labour, in return for governmental favours. There might be some if, the DWP adopts the recommendation of independent policy advisors to expand the use of residential centres for the disabled and long-term unemployed, to be employed on workfare, run by private contractors. Nevertheless, it demonstrates the ultimate extent to which the Nazis attracted and exploited contacts with private industry.

Sources

Martin Broszat, The Hitler State (London: Longman 1981)

Friends of the Reichsfuhrer SS, in James Taylor and Warren Shaw, A Dictionary of the Third Reich (London: Grafton 1987) p. 132.

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5 Responses to “‘Commission Managment’: The Nazi Term for Public-Private Partnership and the Use of Special Advisors from Industry”

  1. Mike Sivier Says:

    Reblogged this on Vox Political.

  2. Sue Paraszczuk Says:

    I’m experiencing a definite shiver down the spine after reading this. I agree you can’t exactly compare the German situation to Cameron’s set up but is that because we find it hard in Britain to think our government is REALLY malevolent? Haven’t we been (deliberately?) immersed in a cultural understanding of our nation as fundamentally benign, at least towards its own citizens? England’s green and pleasant land and all that stuff? The soporific drug of TV and the ideology of the classroom have lulled us into a dreamlike trance whilst the captains of industry and the masters of our fate in Westminster have been weaving a social fabric that can produce the cloth they are now ready to stitch together into a regime that guarantees their perpetual sovereignty over us. They appear to be reaching the point when the kid gloves can be ripped off to reveal the iron fist beneath.
    Apologies for waxing so lyrical!
    And reading this I was also reminded that Hitler had a framed photo of Henry Ford on his wall…and vice versa.

    • beastrabban Says:

      Thanks for the compliment, Sparaszczukster. I think you’re right. There is a tendency to fall into what the great historian Herbert Butterfield called ‘the Whig idea of history’. This is the idea that British history is a gradual process of increasing cultural and social improvement leading to the emergence of democracy, the benign modern state and the British Empire. An interesting corrective to this view is Martin Pugh’s book on British Fascism Between the Wars 1918-1939, if I’ve remembered its title correctly. Pugh argues that we need to take seriously the claim of British Fascists, like Oswald Mosley, that democracy was not a British form of government and that they represented the true continuation of British social and political traditions. He points out that the extension of the franchise by Disraeli’s government in the 1870s did not make Britain a democracy. It excluded women and that section of the working class that did not meet its property qualifications. He points out that Britain at the time did not have a concept of innate human rights. This was felt to be too abstract, and widely rejected because of its origins in the French Revolution. He notes that the right to vote in Britain was closely tied to property qualifications and the rates on housing. He notes also that large sections of the ruling classes were hostile to democracy and the expansion of the franchise. These tended to be centred around the colonial administration, and in particular the India Office. I can see how that would be the case, considering that British India was effectively administered by an unelected bureaucracy and its soldiers. He also discusses the links the British Fascists saw between the Corporativist state and the towns granted a charter by Queen Elizabeth. They viewed these as operating on the same principles, in which political power and the right to vote was linked to socio-economic function. Finally, there is also the fact that the Liberal state itself could be ruthless when dealing with internal militant threats. This was shown in the violence with which the police dealt with the suffragettes, including the use of force-feeding.

      It’s possible to go even further with this. The Wilhelmian German electoral system gave a far high percentage of the working class the vote than in Britain, although the system was organised along class lines so that the working class in fact elected fewer members to the Reichstag than the aristocracy and middle classes. Moreover, there was actually less anti-Semitism in Germany than there was in France or Britain. It was said that Jews had greater opportunities and were better respected in Germany than they were in London. Others have pointed out that Right-wing extremism in Germany was the product of the feeling of national humiliation caused by Germany’s defeat in the First World War. The militant parties and groups of the anti-democratic German Right, of which the Nazis were one of a number, hated the Weimar Republic, the parliamentary system, and the major parties that supported it – the SPD, the Catholic Centre Party and the Liberals, because it was indeed the result of the peace settlement at Versailles. The leading politicians and their parties of the Weimar Republic were denounced as ‘November criminals’ and blamed for Germany’s defeat. This does indeed raise the question of what would have occurred if Britain had lost the War, and been forced to pay crippling reparations and seen its colonies and parts of its homeland confiscated and granted to its enemies. If that had been the case, then it’s more than possible that a Fascistic paramilitary organisation could have seized power in Britain and established a dictatorship. The creation of Northern Ireland shows that could have been a real possibility. This was the result of a paramilitary revolution by Ulster’s Protestants, who fought against their inclusion in the Roman Catholic Free State.

      Baden-Powell also had some of the political attitudes of the Continental Fascists in the ideological role he believed the Boy Scouts would serve. He believed membership of the Scouts would provide British children with an antidote to the lure of trade unions and socialism. European Fascists consciously modelled their movement on the armed forces as they believed military service produced a sense of camaraderie and a common identity and purpose that superseded class divisions, but stressed loyalty to the leader and hierarchy and rejected democracy.

      I think the idea of Britain as a fundamentally democratic nation probably comes from the experience of the First World War and the necessity of combatting Fascism ideologically in the Second. Way back in the 1990s the Financial Times ran an article discussing the way the English-Speaking Union was used to spread democratic ideas through the British Empire and abroad during the Second World War as a way of countering Fascist propaganda. George Orwell in one of his pieces written in the run-up to the Second World War remarked that the political situation had created some bizarre events, like Winston Churchill running around pretending to be a democrat. He also mentions the fact that the stock exchange cheered when General Franco declared war on the Spanish Republic.

      I think there may well come a time when the kid gloves will be off with the ruling classes and the Conservatives, but it will be done gradually, preserving democratic forms and with a Liberal gloss placed on illiberal legislation. The result will be that such measure will get mass support, and the public won’t realise how profoundly undemocratic they are.

      • Sue Paraszczuk Says:

        You’ve certainly given me a lot of food for thought here! Thanks for taking the trouble. I’ve often thought that democracy, or the illusion of it we live with, has been a convenient way to keep us all docile – and the press and other media have been co-opted to play along – while those with power do and take what they please. We, the masses are a potentially dangerous inconvenience. A good book I read recently that says it much better than I can is Alex Carey’s “Taking the Risk Out of Democracy: Corporate Propaganda versus Freedom and Liberty” Carey, now dead, was an Aussie lecturer at University of New South Wales and a founding member of the Australian Humanist Society.

      • beastrabban Says:

        That’s an interesting point, Sue. Looking through the books I bought on Fascism when I was studying it at college, what struck me was that there were journalists and press barons in Germany and Italy sympathetic, or willing to work for the Fascists. Hugenberg in Germany is the classic example. He owned a massive press empire, had connections to I.G. Farben, the great German chemical combine, and also owned Ufa, which was the major German film studio. He funded many of the radical Right parties in the Weimar Republic. Hitler appointed him minister for agriculture and economics in his January 1933, but he was replaced six months later by Walter Darre as minister of agriculture, and Dr Karl Schmitt as economics minister. Schmitt was Director General of the Allianz Insurance Group.

        In Fascist Italy, Mussolini issued the orders to the press from his own Press Office. Although it was an absolute requirement that newspapers present positive stories about the regime, and adulation of il Duce himself, they kept on old, non-Fascist journalists, who continued to write. This would have given a reassuring continuity to the regime and greater verisimilitude to its propaganda.

        The book by Alex Carey sounds very interesting, Sparaszczukster, and absolutely correct in its analysis.

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