Bernd 07/31/2019 (Wed) 21:42:28 No.28367 del
Living standards
It’s common to think of early 20th century Germany as an affluent country with a strong economy that carried it through two world wars. In reality, it had mediocre standards of living and a weak economy, and its economic limitations were a central fact in the 30s and 40s as both an incentive and an obstruction to the decisions taken by Hitler’s regime. Ultimately this weakness was the reason it lost the war.
In common with the remainder of Europe, Germany was behind America. Though technologically both sides of the Atlantic were even, Europe lagged behind in mass manufacturing. America had a 2:1 productivity advantage on manufacturing in general and 4:1 to 5:1 in automobiles and radios. This was made possible by the scale of American markets and resources and symbolized by Ford.
Within Europe, Germany was still behind other economies, particularly Britain, which enjoyed a higher GDP per capita, a prosperous middle class and wealthier workers. German and British industries were evenly matched; what dragged down Germany was its large and outdated agricultural sector and small businesses in crafts and services. Wilhelmine Germany was catching up but that stopped in the Weimar era.

This economic inferiority translated to lower standards of living. In 1936, with full employment, blue-collar households could expect to earn 2,700 Reichsmarks a year, while Americans enjoyed living conditions that would take 5,380 to 6,055 Reichsmarks to replicate in Germany. Individual hourly earnings were measured not in Reichsmarks but in Pfennigs. Diets were monotonous (bread and jam, potatoes, cabbage and pork, washed down with water and small amounts of milk and beer) and food expensive; combined with drinks and tobacco, it could take up as much as 50% of household budgets. With another 12% on rent and 5% on utility bills, a four-person household was left with 67 Reichsmarks per month to spend on transport, education, healthcare, insurance and everything else. Common expenses like buying or resoling shoes took at least a tenth of that value, and buying a new suit could take nearly all of it.
Housing was particularly difficult. Blue-collar workers in Detroit took for granted a four and a half-room apartment with running water and separate kitchen and toilet, but in Germany that would cost 1,380 Reichsmarks a year in rent. More than one working-class family often shared the same rooms, and many lived in one room apartments, some even in attics and cellars. And this was before the crisis, which created squatter camps with tens of thousands of people outside major cities. This housing shortage was in large part the product of Weimar policy: in the immediate postwar years rent controls were imposed to prevent evictions, but they made the construction of further housing unprofitable. To remedy this a tax was levied on homeowners and used to fund public construction, but the new buildings were too expensive for working class families. This effort collapsed during the Great Depression.

In light of this, Hitler did want to bring material prosperity, to all social classes and as a central objective of his career. But he did not believe it could be achieved in peace. He rejected liberal and capitalistic notions of progress through technology and exports, as that would just lead to international competition, and instead focused on the acquisition of living space and the settling of scores with the Versailles powers. Given West Germany’s later miracle this may seem outlandish, yet in the interwar context he had plenty of reasons to be pessimistic. But prior to war, the Reich could still take small measures to improve the standard of living.