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Henry Morgenthau, The German Character
Five chapters from Morgenthau’s book, Germany is our Problem, here published with an introductory note by Ellopos. Emphasis, in bold or italic letters, by Ellopos. Complete book in print.
52 Pages
Page 24
Even Germany's 12.2 per cent of the European market was achieved by lavish use of those trade practices which the world hopes to abolish in the interest of peace and prosperity. Even before 1933, Germany gave government subsidies to stimulate exports. After Hitler came to power the subsidies rose to fantastic heights. Clearing arrangements, multiple currency maneuvers and foreign exchange discrimination were used as part of a system to force other countries to buy in Germany. If they refused, they lost the German market for their own products. Under any kind of fair competition, Germany would be lucky after the war, even if their factories could be rebuilt and reconverted quickly, to reach much more than half her prewar exports of the products of heavy industries. Perhaps $400,000,000 worth could be disposed of without violent artificial aids. In the proportion of exports in Germany's most successful years this would be divided: Iron, steel and other metal products $ 72,000,000 Machinery (except electrical) $ 100,000,000 Electrical equipment $ 48,000,000 Chemicals $ 48,000,000 Automobiles $ 32,000,000
The idea that these amounts could not be supplied by plants which will be established outside Germany and by existing industries in Europe is fantastic. But even if Europe could not fill the gap, the British and Americans, who have greatly increased their plant capacity during the war, could easily serve this market. The whole amount is about 4 per cent of the minimum estimates of postwar United States exports under full production.
It is impossible to measure statistically just how much German oppression prevented the normal, natural industrialization of other European countries. Cartels were the chief weapon, reinforced by export subsidies, special kinds of currencies and clearing agreements. Clearing agreements were bilateral arrangements ostensibly designed to prevent exchange fluctuations. They did it by carrying on trade between the two countries at an agreed rate of exchange without either using the currency of the other. Each set up a clearing office. Importers paid to this clearing office in their own currency. Exporters were paid by the clearing office, also in their own currency. In the long run the amounts had to balance as between imports and exports and as between the two countries.
Cf. H. Arendt: totalitarianism reduces men to impersonal natural forces * German philosophers in support of Nazism * Beethoven and Mauthausen * The Superior Race of Germans * Kalergi, European Spirit must Precede Europe's Political Unification * La Construction de l'Europe selon Jean Monnet * Plan Fouchet * Mitterrand and Kohl urge European Political Union * Il Manifesto di Ventotene
