Economic crises and political maneuvering: The making of Nazi Germany

Following the end of World War I, many Germans were angry about how things turned out for them.

When the Treaty of Versailles placed responsibility on Germany and her allies for "all the loss and damage" suffered by the Allies.

Article 231 of the treaty, also known as the War Guilt Clause, placed full responsibility for World War I on Germany, forcing it to accept blame and pay heavy reparations.

When news of this reached the German people, many of them felt humiliated.

Unfortunately, Germany’s fragile postwar democracy, known as the Weimar Republic, faced numerous crises, including economic instability and political extremism.

In particular, many right-wing nationalists held a false belief that Germany's defeat in World War I was due to internal betrayal by civilians, particularly left-wing politicians, such as socialists, communists, and Jews, on the home front, rather than military failure.

They called this myth Dolchstosslegende, meaning a ‘stab in the back’ because they felt that the German politicians had betrayed its own citizens by accepting the blame and the punishments handed out as a result.

These politicians were called the ‘November Criminals’.

One of the terms of the Treaty of Versailles was the requirement that Germany paid back enormous reparations (compensation for war damage) to other countries that totalled 132 billion gold marks.

This amount was so large that there was a real risk that the payments could cripple the economy.

This fear seemed to be well founded because, by the time the Treaty of Versailles reparations were being enforced in the early 1920s, the German economy was already in a fragile state.

So, the new Weimar government decided to print increasingly money to cover wartime debts, but they couldn't print enough.

Then, when Germany started to fail to meet its reparation payments, France and Belgium occupied the Ruhr region of Germany in 1923, which only worsened the economic crisis.

Once more, the government tried to print more money to cover the costs, but so much money was created that Germany suffered ‘hyperinflation’, which meant that German cash was worth very little in real terms.

Hyperinflation wiped out the entire life savings of the common people between 1921 and 1923 and it looked like the Germany economy and government were on the edge of collapse.

However, the Dawes Plan of 1924 helped to stabilize the German economy by restructuring reparation payments and securing loans from the United States.

This offered a brief period of economic recovery, which lasted from 1924 to 1929.

Then, in 1929, the Great Depression hit Germany. Millions of Germans lost their jobs and the anger they felt at the end of World War One returned.

The German people began looking for new political movements to save them from economic collapse.

One of the many political parties seeking to gain control of Germany was the Nazi Party, led by Adolf Hitler. 

In World War One, Hitler had served in the German army and was similarly angry about Germany’s defeat.

Seeking a political group that offered solutions, Hitler joined a small political party in 1919 called the National Socialist German Workers' Party.

In 1921, Hitler became its leader, but it remained a small group with few followers.

As leader, Hitler presented himself as a heroic war hero who promised real solutions to Germany’s problems.

Hitler initially tried to seize power in Germany through an armed insurrection on November 8-9, 1923.

It was known as the Beer Hall Putsch, but it ended in failure and his arrest.

The subsequent trial, however, gave national attention and a rare platform to spread his ideas.

Regardless, Hitler was found guilty of treason against the German state and was sent to prison.

While in prison after the failed Beer Hall Putsch, Hitler wrote his book Mein Kampf, where he outlined his ideology of Aryan supremacy, anti-Semitism, and his vision for Germany’s future.

However, he served less than a year of his five-year sentence. Once he left prison in 1924, he returned to raising support for the Nazi Party.

Now, his strategy shifted from attempting an armed coup to seeking power through legal political means.

Part of this new strategy was the creation of a Nazi Youth Group, called the Hitler Youth, which was started in 1926.

Also, Nazi propaganda newspapers were created to share their political ideology, and Hitler held a range of public meetings where he delivered speeches to the attendees.

However, these efforts made little impact. In the 1928 elections, only 2.6% of Germans voted for the Nazis.

So, in 1929, a member of the Nazi party named Joseph Goebbels was given the job of improving the Nazi’s election campaigns, with a focus on getting middle-class Germans to vote for them.

That is when the Wall Street Crash occurred, and the Great Depression hit Germany.

The Nazi Party quickly capitalized on the economic despair, which allowed them to gain a new political momentum.

By 1932, the Great Depression had driven Germany’s unemployment rate to an estimated 30%.

So, as millions of Germans lost their jobs, they began to believe that someone like Hitler could make a difference to their suffering.

This seemed to work, as Nazi Party membership surged from around 100,000 to over 800,000 between 1928 and 1932.

As a result, in the July 1932 elections, the Nazi Party received 37.3% of the vote, making them the largest party in the German parliament, known as the Reichstag.

It looked as if they could gain power in Germany, but a powerful politician stood in their way: President Hindenburg.

President Paul von Hindenburg was a respected World War I general who did all that he could to ensure that Hitler did not take power in Germany.

He was worried about what the Nazis were capable of. Although, in the November 1932 elections, the Nazis saw a 4% decline in their votes, down to 33%.

So, many people breathed a sigh of relief that the popularity of Hitler was fading.

Although still the largest party in the Reichstag, the Nazis failed to gain a majority, which left Hitler frustrated.

President Paul von Hindenburg, who had been wary of appointing Hitler as chancellor, used the decline in votes as an argument against him.

The political climate was unstable, and the Nazis appeared to be losing momentum.

However, the Communists gained ground, a situation which alarmed conservative leaders.

They feared that a Communist takeover could be disastrous for their interests.

In January 1933, Franz von Papen, who had served as chancellor before Hitler, and wanted to return to power, convinced Hindenburg to appoint Hitler as chancellor while believing he could control him.

Von Papen proposed a plan to limit Hitler’s power by ensuring that conservative ministers held key positions in the new government.

In fact, Von Papen believed that he could manipulate Hitler and use him for his own purposes.

Hindenburg, who was more anxious about the Communist threat, reluctantly agreed to the arrangement.

On January 30, 1933, Hitler was appointed chancellor, with von Papen serving as vice-chancellor.

This decision was based on a flawed belief that Hitler could be contained and manipulated within the existing political system.

Once Hitler became chancellor, he acted swiftly to consolidate power. On February 27, 1933, the Reichstag building was set on fire, an event which shocked the country.

Hitler blamed the fire on the Communists and convinced Hindenburg to pass the Reichstag Fire Decree the following day.

This decree suspended civil liberties and allowed the Nazis to arrest political opponents without due process.

The decree was used to suppress the Communist Party and intimidate other political groups.

With the left-wing opposition neutralized, Hitler was able to move forward with his plans to dominate the Reichstag.

On March 23, 1933, Hitler introduced the Enabling Act to the Reichstag, a law which would give him the authority to pass laws without parliamentary approval for four years.

Hitler needed a two-thirds majority to pass the act, and through threats, promises, and the absence of Communist members who were either arrested or in hiding, the Nazis secured the necessary votes.

The Enabling Act effectively ended democracy in Germany, granting Hitler dictatorial powers.

Over the next few months, Hitler used his new powers to ban all political parties except the Nazi Party.

By July 1933, Germany had become a one-party state, with Hitler firmly in control of the political system.

In 1934, Hitler moved to eliminate any remaining threats to his rule. The Night of the Long Knives, which took place from June 30 to July 2, 1934, saw the assassination of Ernst Röhm and other leaders of the Nazi paramilitary group, the SA, who had become a potential threat to Hitler’s authority.

Hitler also used the opportunity to eliminate political rivals both within and outside the Nazi Party.

This purge cemented Hitler’s control over the military, which now pledged loyalty to him personally.

When President Hindenburg died on August 2, 1934, Hitler merged the roles of president and chancellor, declaring himself Führer.

With the support of the military and the Nazi Party, Hitler had achieved supreme power in Germany.