Reich Chancery memorandum: „Organization of the German Economy“

9/7/1940

On 22 June 1940 Göring as plenipotentiary for the Four-Year Plan issued an order on ‘the organization of our economy after the conclusion of the military conflict’. As a result the Reich Chancery produced the following memorandum for Reich Minister Hans Heinrich Lammers, which was used on 22 July 1940 as the basis for a conference of departmental heads chaired by Funk, Reich Minister of Economics.

By the annexed Order the Plenipotentiary for the Four-Year Plan has directed the Reich Minister of Economics to prepare comprehensive measures for the organization of the German-European economic area. This task calls for the following observations. The great successes of the German armed forces have laid the foundation for the economic reorganization of Europe under German leadership. While German efforts in recent years have been chiefly concentrated on military armaments, in the future we shall also be able to pursue the path of economic expansion and the broadest possible development of all productive forces, which will greatly improve the standard of living. The most important precondition is to do away with the economic Balkanization of Europe. A new large economic area will come into being, in which the economy can develop with only basic direction from the state. The parts of Europe under Germany’s influence must be unified in the same fashion as other continental areas, e.g. the USA and Russia.

This creation of an economic area on a European scale was arbitrarily prevented after the World War by the dictated peace of Versailles and associated treaties. The result was to set up 35 independent European states, 16 of which had less than 10 million inhabitants, and to create 7,000 kilometers of new customs frontiers. Attempts at unification, e.g. the Anschluss of the former state of Austria to Germany, were frustrated, and the regime of small economic units was artificially encouraged.

The large-scale economic unification of Europe can be achieved in various ways. States which economically complement Germany or resemble it in economic structure can largely be unified with it. This is especially true of the Scandinavian countries and the Netherlands, Belgium and Luxemburg. With other states the ties will be less close.

Such a central European economic community under German leadership will require a solution of the following problems among others:

1. The central European currencies must be placed on a uniform basis by establishing a fixed rate of exchange between those of the other countries and the Reichmark.
2. Customs barriers in central Europe must be abolished. Damage to individual industries can be avoided by the conclusion of quota, price and sales agreements among economic groups in the respective countries. In the same way agriculture could be protected by measures to be adopted by Reich agencies and their counterparts in the other countries concerned.

The following are the principal general advantages of an economic community:

1. The possibility of rational production and of concentrating the most efficient concerns in    the most favorable sites, eliminating inefficient plant and doing away with uneconomic movement of goods.
2. Removing payments difficulties.
3. Enlarging the customs-free marketing area.
4. Increased leverage in trade negotiations and relations with other countries.

Such a central European union would give a powerful impetus to the European economy. Admittedly it would not confer autarky upon Europe: there would still be a need for various raw materials, e.g. rubber, important non-ferrous metals, hides and skins, textile raw materials, foodstuffs and fodder. The deficiencies could be made good either from colonies or by trading with other large economic areas.

As far as numbers are concerned, a central European economic bloc including those of Germany’s neighbors that are envisaged for the purpose would comprise a much larger population than the Unites States‘ 130 million.

» See the original document (in German)

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