What if? Democratic Germany (new expansion)

[keynes2.0]

The only way to prevent unemployment was to steer all of that idle industry to internal projects, causing the German economy to be hugely isolated (hence why you still see increasing GDP).

Either you are misunderstanding them or they are making a very elementary economic error. A country with a weak currency is a country where it is unusually profitable to export and unusually unprofitable to import. If a market economy is allowed to function (which was not the case in Nazi Germany) this allows for employment to increase for three reasons:
1) It is more profitable to hire people to make products for export
2) Foreign competitors to your firms have their prices artificially raised
3) Foreign investors in your country will get a better value for their investmetn

Note that all of these require a market economy to be operating without much obstruction. If foreign investment and exports are both being hamstrung, this wont happen.

But this still doesn't overcome the issues highlighted above. Yes German industry was attractive, but without the state intervention to keep the industry afloat, it would not have continued to expand.

Are you sure you read Tooze? Because a pretty core theme to Tooze is that shifting resources from one economic activity to another is just the mirage of total factor productivity acceleration, not the real deal. (He doesn't say total factor productivity but I think it's a useful term.)

Germany was a country that was ripe for investment, had plenty of entrepreneurs and was attractive to foreign capital. While there certainly were inefficiencies in the German market (the relatively low level of conglomerates), every economy has some problem or other and Germany was in pretty decent shape. Before the Great Depression their economy was doing fine so it should have done fine once the shock was past.

 

[JodelDiplom]

Germany was a country that was ripe for investment, had plenty of entrepreneurs and was attractive to foreign capital. While there certainly were inefficiencies in the German market (the relatively low level of conglomerates), every economy has some problem or other and Germany was in pretty decent shape. Before the Great Depression their economy was doing fine so it should have done fine once the shock was past.

The interwar era was to my knowledge not one of very successful foreign investment schemes. The iconic projects of the time that I can think of were Fordlandia (rubber plantations of Ford Motor Company in Brazil, huge failure), the US activities in Stalin's industrialization drives, and the ponzi credit schemes that triggered the collapse of the German and other European banks in the wake of Black Monday.

It wasn't a good time for global capitalism. And I really don't think that Germany remaining democratic (or returning to democracy after a nazi interlude) would change this. The biggest capitalist economies, i.e. the ones with theory capital to spare for investments in Germany, were the USA and Britain, and those were mired in crisis and recession throughout the 1930s. The USA had also taken a turn for protectionism after the black Monday and all other countries, more or less causing the whole world to respond in kind with punitive tariffs. Trust was low, overcapacity was everywhere, markets were closed, autarky was the slogan of the day. it just wasn't the sort of environment in which a country with latent industrial potential like Germany would prosper without heavy handed government intervention.

 

[keynes2.0]

The interwar era was to my knowledge not one of very successful foreign investment schemes. The iconic projects of the time

Opel was a wholly owned subsidiary of General Motors and was the largest car manufacturer in Europe.

 

[JodelDiplom]

Opel was a wholly owned subsidiary of General Motors and was the largest car manufacturer in Europe.

Largest car manufacturer in Germany, but AFAIK not in Europe. In any case I don't know whether you can count GM's 1929 acquisition of Opel as a successful investment, that happened right before the onset of the great depression. Opel sales crashed hard just one year after GM bought Opel and didn't recover until long after the Nazis took over.

The business climate wasn't good, there was huge overcapacity (but that's not necessarily bad though, if you have a US mega corporation backing you and the competition doesn't) and trade policies were detrimental to export oriented growth models.

In the event of a return to democracy in Germany, even if the new government made it a priority to push for reduction in trade barriers it would take years of trust building and agenda setting with the other democracies until that would yield results. Until then Germany would remain economically struggling.

 

[Easy-Kill]

Either you are misunderstanding them or they are making a very elementary economic error. A country with a weak currency is a country where it is unusually profitable to export and unusually unprofitable to import. If a market economy is allowed to function (which was not the case in Nazi Germany) this allows for employment to increase for three reasons:
1) It is more profitable to hire people to make products for export
2) Foreign competitors to your firms have their prices artificially raised
3) Foreign investors in your country will get a better value for their investmetn

If we were discussing a healthy economy, then yes. However, Germany in the 1930s was not a healthy economy. In order to make the goods you suggest - they needed raw/rare materials. They couldn't acquire this on the open market because they didn't have sufficient foreign capital. Unless there is a miracle that suddenly makes the German currency worth something, they are forced to go the centralisation and militarisation route.

However, I sense that we have a diametrically opposed opinion here which we are unlikely to agree on.

 

[keynes2.0]

They couldn't acquire this on the open market because they didn't have sufficient foreign capital. Unless there is a miracle that suddenly makes the German currency worth something

It wouldn't take a miracle, all it would take is not having a policy of deliberately burning every ounce of credit they had. This is like the whole point of what I'm saying... the Nazis did a thing so if it weren't the Nazi's that thing wouldn't happen.

In the event of a return to democracy in Germany, even if the new government made it a priority to push for reduction in trade barriers it would take years of trust building and agenda setting with the other democracies until that would yield results. Until then Germany would remain economically struggling.

Those years had already taken place: 1925-1932.

 

[Andre Bolkonsky]

Because in democracies people dont start petty wars of conquest over imaginary grievances.

Of course they do. A few examples off the top of my head . . . .

Half the Indian Wars were begun for superficial reasons, invented because Native Americans were sitting on valuable real estate the United States wanted

The Mexican American War, where Polk moved US troops onto Mexican territory, then got furious when they were attacked and declared war

The Spanish American War was the result of Yellow Journalism misrepresenting the explosion of the boiler of an American Battleship in a foreign harbor

The Gulf of Tonkin incident was engineered, misrepresented, and a bold faced lie when translated into the Gulf of Tonkin Resolution

The Invasion of Iraq during the Second Persian Gulf War, chasing shadows that no longer existed for reasons that make no sense to anyone, for no other reason than the President had hurt feelings Sadaam had once threatened his father.

 

[JodelDiplom]

Of course they do. A few examples off the top of my head . . . .

Half the Indian Wars were begun for superficial reasons, invented because Native Americans were sitting on valuable real estate the United States wanted

The Mexican American War, where Polk moved US troops onto Mexican territory, then got furious when they were attacked and declared war

The Spanish American War was the result of Yellow Journalism misrepresenting the explosion of the boiler of an American Battleship in a foreign harbor

The Gulf of Tonkin incident was engineered, misrepresented, and a bold faced lie when translated into the Gulf of Tonkin Resolution

The Invasion of Iraq during the Second Persian Gulf War, chasing shadows that no longer existed for reasons that make no sense to anyone, for no other reason than the President had hurt feelings Sadaam had once threatened his father.

Well alright democracies do start petty wars against weak opponents but not big wars

 

[fredinno]

Even with preferential treatment, even counting their non aristocratic hangers-on, aristocrats really are a very, very tiny class of people by numbers.

The idea that they would dominate the government of a country where an elected parliament passes laws and chooses the government, is silly. Just imagine that the enlisted men who fought under those officers also get to vote. They alone outnumber them 20:1... And their needs and wants in the aftermath of civil war victory are very different from those of their officers. You can't run a military with elected officers, so how are these mythical Prussian officers supposed to run the whole country with an elected government?

Have you ever heard of something called 'corruption?'

 

[fredinno]

Well alright democracies do start petty wars against weak opponents but not big wars

Authoritarians don't like starting wars against big nations either, unless they're highly militaristic (ie Prussia, Imperial Japan).

 

[Klausewitz]

Authoritarians don't like starting wars against big nations either, unless they're highly militaristic (ie Prussia, Imperial Japan).

But start much fewer wars in the same timeframe when compared with beacons of freedom like Britain or even the U.S.

 

[Had a dad]

this is the History forum, not the alt history forum. If this is for a mod, it should be in that mod forum or the OT