The decade before Hitler was for German capitalism mainly a period of stabilisation and attempted recovery. Many new parties and groups were thrown up, ranging from different brands of Communism to currency reform fanatics and types of Fascism. The working class, not understanding Socialism, but merely possessing a reformist outlook and suffering deeply, alternately swung their support over to each fresh demagogue, and illusion and despondency were the inevitable result. American capitalism, after helping to smash Germany, now undertook to restore it. This served two purposes. It provided a new outlet for American investments and rebuilt a formidable competitor to Britain, as an offset against the growing Anglo-American rivalry for world dominance.
If it was possible to restore Germany to a healthy economic (capitalist) condition, the prospects would be rosy for profitable financial investment.
Through the Experts Commission (chairman, General Dawes) the chaotic reparations demands and methods of payment were regularised, and German firms, municipalities and local governments were able to obtain the foreign loans necessary to resume their former profit-making activities. The aim of the Dawes Plan was to make of Germany one vast international (and especially American) financial undertaking. American capitalists came to the rescue (on terms) of their German brethren, and in all but name Germany became an American colony. The foreign loans gave such an impetus to German trade that for five years (1924 to 1929) German capitalism was able to quite easily pay its interest claims and reparations demands. It was, however, without solid foundation, for its prosperity was only made possible with the assistance of foreign loans.
Guarantees to the American and other capitalists were included in the Dawes Plan. The State railways were taken out of the control of the Reich and placed in the hands of a company formed for the purpose. The Reichsbank was also taken away from the German Government and transformed into an instrument under “foreign” capitalist control, allowing pickings for the home capitalists, etc. French capitalism now received its reparations share regularly and withdrew its forces from the Ruhr. Herr Stresemann now devoted his energies to securing the evacuation of the Rhineland by the Allied armies, and out of this need of German capitalism was born the Locarno Pact and Germany joined the League of Nations. An era of mad speculation commenced; for the sake of American money German capitalism abolished some of its customs, including Martial Law. The Generals made way for the Dollar.
With the death of President Ebert an election took place (1925). The Social-Democratic candidate, Braun, came second with 8 million votes, withdrew their candidate and supported the nominee (Marx) of the reactionary Catholic Centre Party, as the “ lesser evil."
At the elections in 1928 the Labour Party obtained its greatest victory—over 9 million votes, and the Communists three and a quarter million—on a programme differing very little from the ordinary capitalist parties. Very few among the voters wanted or understood Socialism and were mainly captured by the promise to break the shackles of Versailles. The Social-Democrats now joined a “People’s Front" and entered the capitalist coalition government, demonstrating their political unity and ideological agreement with Stresemann and the capitalists in general. Germany had its Snowdens, MacDonalds, etc. The chief task confronting this motley crew was to make Germany “independent,” that is to say, now that German industry was yielding large profits, the home capitalists wished to limit the grip of American finance and reap the harvest for themselves. The rôle of the Social-Democrats was the same the world over—to act as the facade and to harness the working class to the capitalist machine. For this they received the usual Judas price—a share in the Government and the large salaries that go with it.
Severing became Minister of Interior, Wissell Minister of Labour and Hilferding Finance. The Dawes Plan was superseded by a definite settlement named after its chief-financier, Young. Under the Young Plan the payments to be made by Germany were definitely fixed for 60 years. German capitalism was now master in its own house and the control imposed by the Dawes Plan finished and the Army of Occupation marched out of the Rhineland. Just at this time the “world economic crisis” made its appearance. The financial smash in the New York Stock Exchange let loose a flood which swept everything before it. How this affected Germany will be seen in our concluding article.
Lew.
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