A command economy is an economic system in which the government allocates the resources rather than private bodies. In this essay I will consider the extent to which attempts to create such a type of economy fixed the economic problems that Weimar suffered; and I shall evaluate each argument by highlighting the relative impact it had on the sustainability of the economy - as this was one of the main issues with the Weimar economy.
The first issues which the command economy was successful in repairing were the consequences of the Great Depression of 1929. The two main consequences of the Wall Street Crash were the rise in unemployment, some regions had above 40%, and the fall in German production - which had fallen by 40% (measured by GNI). The attempted command economy fixed both of these by the increased spending on public works and firms such as the autobahn, the army, the Berlin Olympic games as well as Volkswagen - with 1.4 million being from army recruitment alone. Private employment was encouraged via wage subsidies and Mefo bills (Government IOUs) were used to place government orders for privately produces goods such as rearmament.The command economy was so successful that by 1939 the GNI had returned to the level it once was in the ‘Golden Years’ and only 35000 men were without work. Furthemore, due to rearmament, firms such as Daimler Benz and IG Farben grew by nearly 700% creating a positive ripple effect on the economy as the invested more thus creating jobs and growth which fuelled 8-10% economic growth in the following years (higher than any rate of economic growth under Weimar). The extent to which the command economy had a relative impact on solving the Great Depression is of great significance; the encouragement of production and employment via the use of Mefo bills recovered the economy to its original state - and unlike the Weimar premiership it had done this via the use of domestic government Mefo bills rather than printing money or foreign debt which was unsustainable as evidenced under Weimar.
The second issue in which the command economy was successful in remedying was the poor industrial relations within Germany. Even during the Golden Years of Weimar a combined total of 20.3 million working days were lost due to industrial actions from trade unions - this weakened productivity and German output. The Nazi’s altered this by outlawing trade unions, but replacing it with the German Labour Front which had two sub organisations called the KDF and the SDA - these sub organisations provided subsidised holidays/trips and also renovated working conditions for the labourers thus enticing more to join the workforce - the KDF also increased working week by an average of 4 hours and set the wage rate. Furthermore, the Nazi’s increased the supply of labour to firms by sending anyone who was ‘work shy’ (refused a job) to prison .The plan worked tremendously as it allowed for greater production and productivity in Germany; hence the total increase in production from 1928 levels was 25% in 1938 - and by 1939 there were no days lost on strike. In addition to this, the fall in costs due to lower wages allowed big business to increase takings by 116% in the same time frame which allowed for greater investment back into Germany hence why investment rose to 3 billion marks in 1938. The extent to which DAF solved the issue of poor industrial relations is of utmost importance - although there was a gain to the big industry and its customers- it exacerbated the lack of sustainability in the KPD and SDA programmes - both cost vast sums to operate and the government was still operating a 15 billion mark budget deficit in 1938 with a rising national debt.
However, the attempts to create a command economy were not successful in altering the lack of self sufficiency of key goods in Germany such as raw materials and agricultural produce. Command economy policy surrounding agriculture had raised levels of self sufficiency - such policies included the prevention of banks repossessing farmland, the National Food Corporation (which told farmers what and how much to produce) and huge tariffs on imported goods. However, by 1939 Germany was still importing 20% of it’s agriculture and in order to sustain such level of imports Schact had to reduce imports of luxury goods such as tropical fruits, which fell by 40%, via the New Plan which only allowed for government approved imports. The lack of ability to retain self sufficiency became so dire that in 1939 rationing began which further harmed material living standards. The command economy also was unable to create self sufficiency in raw materials - despite forcing the cartelization process which did increase production of raw materials - Germany was still importing 33% of its raw materials in 1939. Raw materials were a huge component of the rearmament industry, upon which the command economy was built, and due to lack of such materials the economy began to inflate - reaching 5% in 1938/39 thus further straining wages and living conditions. The extent to which the command economy was unable to remedy the lack of self sufficiency is huge - this is due to the fact that the 33% figure of imported raw materials was taken after the invasion of the Sudetenland. Had Hitler not invaded such a mineral rich area the level of imports in such raw resources would have been far higher and thus the negative effects on the economy would have been far larger, thus making such an economy unsustainable - even taking into account the invasion Germany could not continue to satisfy it’s self sufficiency by invading other territories in the long run without causing war eventually which would lead to a destruction of the economy.
In conclusion, the Nazi’s attempt to create a command economy did fix immediate problems of the great depression by giving tax cuts to married couples whilst also stimulating production with mefo bills. Although the unemployment figures were, to an extent, tainted via the removal of Jews and women from the workforce - the figures show a significant enough decrease to warrant the argument the Nazis did cut unemployment. However the failure to cut the national debt by even a fractional amount, and the fact that Germany was still dependent on imports for basic fats, foods and materials proves that the economy would not have been sustainable in the long term - as evidenced by the fact that when the first round of mefo bills were due to the Nazis forced firms to buy bonds and forcibly took money out of savings accounts in order to pay the mefo bills as they lacked funds to do so. Therefore I believe the command economy was not successful in fixing the problems of Weimar - as both economies lacked sustainability.