The Nazis’ Promotion of Private Business and Businessmen as the Elite

Robert A. Brady provides further evidence of the capitalist nature of Nazism in his book, The Spirit and Structure of German Fascism (London: Victor Gollancz 1937) by pointing out how the Nazis promoted private industry and businessmen as part of the biological elite, who were entitled to positions of leadership. They also embarked on a campaign of privatization of state enterprises, and promoted to positions of leadership in the economic direction of the state private businessmen, even when the majority of enterprises in that particular sector of the economy were state owned. And finally, the German law the Nazis used to promote their management of industry was that which recognized the management of private property for public use, as against proper socialized or nationalized industry.

Brady points out that the businessmen and functionaries who joined the Advisory Council of the National Economic Chamber had to take an oath to serve the Fuhrer and National Chancellor, which meant Hitler in the two offices he occupied, the goals of the National Socialist party, the Third Reich and the construction of the people’s community. (p. 265). But he also quotes Hitler’s economics minister, Hjalmar Schacht, who declared that businessmen were indispensable to the Nazi system, as was free competition.

“We cannot dispense with the economic willing of individual business leaders and workers,” Schacht said. To do so, he held, would be to destroy “the creative power” of the people. The function of business enterprise is to release this creative power on behalf of the nation. “Under no circumstances,” he continued, “shall we destroy the multifarious individual character of our economic system. For all time to come we shall need the independent employer who, for better or worse,, is connected with his enterprise.” In other words, businessmen in the new Germany are to be given free rein to function as before, except now they must be “honest” in the sense that they must not resort to “unfair” tactics to achieve corporate ends. (pp. 265-6).

He further quotes Schacht as saying, “We cannot get along without an honest struggle of competition”. (p. 266).

He makes it also clear that the German business community were also able to name the Nazi functionaries appointed to lead the various state planning organisations controlling private industry. He writes

Since the whole Nazi philosophy necessarily calls for this apotheosis of bourgeois and capitalistic virtues, it is only natural that when they were presented with an opportunity to shape organization more nearly after the pattern of their hearts’ desire the business men should also be able to name their controlling staff of “Leaders.” And such has been the case. In all the literature published by business organisations, and of all the dozens of businessmen personally interviewed in Germany, regardless of their industrial, trade, or financial origin, not a single criticism has been found of the type of “Leaders” placed in command. There is a great deal of complaint about individuals and policies, but there are uniformly the pleadings of minority groups who are being discriminated against, or else against the specific incidence of policies which economic facts compel them to endorse.

Further, the leadership has been entirely that of men enjoying the confidence of the business community. This holds for the Chambers of Industry and Commerce, the Provincial Economic Chambers, the various National, Economic, and Functional (or Trade) Groups, and the National Economic Chamber and its various subdivisions. The first Leader, Schmitt, was a well-known German business man, and thoroughly acceptable to the business community at large. The second Leader, Dr. Schacht, has been so completely acceptable, and his dicta so readily enforced throughout the country, that he is commonly known as the “economic dictator of Germany.” Under the leadership of these men, the appointment and removal of inferior “leaders” through the system has been, with minor exceptions, entirely to the satisfaction of the business communities affected. (p. 290).

He also describes how private industry, and privatization, were promoted against state industries.

The same picture holds for the relations between the National Economic Chamber and the organs of local government. As Frielinghaus has put it, “The new structure of economics recognizes no differences between public and private economic activity…” Not only are representatives of the various local governments to be found on both the national and regional organs of the National Economic Chamber, but it is even true that local government is co-ordinated to the end that economic activities pursued by them shall enjoy no non-economic advantages over private enterprise.

The literature on this point is perfectly explicit, being of a nature with which the general American public is familiar through numerous utterance of business leaders on the “dangers of government competition with private enterprise.” Under pressure of this sort the Reich government and many of its subsidiary bodies have begun to dispose of their properties to private enterprise, or to cease “competition” with private enterprise where no properties are at stake. Thus the Reich, the states, and the communes have already disposed of much of their holdings in the iron and steel industry notably the United Steel Works), coal, and electric power. Similarly, support is being withdrawn for loans to individuals wishing to construct private dwellings wherever private enterprise can possibly make any money out of the transactions. True, the government has been expanding its activities in some directions, but mainly where there is no talk of “competition with private enterprise,” and with an eye to providing business men with effective guarantees against losses. (pp. 191-2).

A little while ago I posted up a piece from Maoist Rebel News on YouTube, which also cited articles from economic history journals to show that both the Nazi and Italian Fascist regimes engaged in massive privatization programmes beyond those of other industrialised western nations at the time.

Brady also points that, while three quarters of the German electrical industry was state-owned, it was private businessmen who were placed in charge of it.

Nothing could show more clearly the intent of Nazi control in economic affairs than the make-up of the active management of this organization. Despite the fact that better than three-fourths of all German electric power is owned or controlled by public bodies, the directing heads of the National Electric Power Supply Federation are drawn almost exclusively from the ranks of private enterprise. Its first Board of Directors was presided over by two chairmen, both representative of private power companies: Hellmuth Otte, General Director of the Hamburg Electric Works, Inc. (controlled by the Siemens-Schuckjert combine, largest manufacturers of electric equipment and supplies in Germany), and Dr. Wilhelm Luhr, member of the Board of Directors of the Gesellschaft fur Elektrische Unternehmungen-Ludwig Lowe & Co. A.G. (the largest holding company in the private German electric-power industry, the company likewise controls several electrical supply manufacturing concerns).

This is very similar to the corporatist system in Britain and America, in which businesspeople have been appointed to government posts overseeing the economy. This has been done both by the Republicans and Democrats in America, and by the Tories and Blair’s New Labour over here. George Monbiot described the situation in Britain very thoroughly in his book, Captive State.

He also makes it very clear that Nazi economic planning is based very much on private enterprise, going back to a distinction made between private property for public use and socialized property in German law.

From what has been said above it is perfectly clear that “planned organization” should be understood not as social-economic planning in the socialist sense of the term, but as “business co-ordination” with a view to exercise of monopoly powers. There is nothing in the literature which permits a discerning reader any other interpretation. By the same token, the expression – interlarded through the endless stream of propaganda and explanatory newspapers, brochures, books, and reports-Gemeinnutz geht vor Eigennutz, requires transliteration into English patois in order to be understood properly. Gemein means “common,” or “public”, or “general”; nutz means “fruits,” or emoluments.” or “returns.” The expression Gemeinnutz as used by the Nazis, means “return to the community,” or, more precisely, “service to the community.’ Eigen on the other hand, means “individual” or “own.” Eignenutz thus means “returns to the individual,” or “profits”. The exact meaning of the whole expression is “services to the community before profits to the individual”; the American wording is “profits through service.”

This interpretation is in line with an old distinction, running back through several generations of German economic and business literature, between privatwirtschaft and Gemeinwirtschaft, on the one hand, and Gemeinwirtschaft and Sozialwirtschaft on the other. Privatwirtschaft has always been taken to mean an economy of private enterprise in the English, liberal, laissez-faire sense. Gemeinwirtschaft was used to mean a profits economy from the public point of view, or, in other words, a profit economy supplying a service tot he community. Sozialwirtschaft, on the contrary, has long meant socialization. All the Nazi literature emphasizes the present economic system as a Gemeinwirtschaft. (pp. 319-20).

It is thus very clear that the Nazi economy was very definitely capitalist. It celebrated the private businessman as a member of the economic and social elite, and promoted private enterprise and its leaders against state-owned industry, which it also privatized as far as possible. And it made very clear in law that the economy was a private enterprise supplying a public service and not a socialized economy.

Those who claim that Nazism was a form of socialism are wrong, and arguing so in order to try to discredit socialism and the Left through guilt by association. But the Nazis promotion of private enterprise, business interests and management also make it extremely similar to contemporary corporate capitalism, as advocated by the Republicans, Corporate Democrats, Tories and Blairite New Labour.

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