In a previous article, (1914 – 1918: Capitalisms First Global War,) documentary evidence was presented, to support an assertion that the mainstream media and historians in the west generally ignore. The contention in that article was that; the underlying economic basis of modern wars since the 17th century lies in the extraordinary expansionist propensity of the capitalist mode of production. In other words, at the core of the 20th century confrontation between the then ‘Great Powers’ was capitalist economic expansion. This article will provide documentary evidence that what was true in the case of the 1st World War, was also true for the Second.

It may be recalled from the evidence produced in the first article, that despite the rhetoric the motives of the German capitalists, pro-capitalist politicians and the military elite, before and during the 1st World War was to gain territory, material resources, markets and cheap labour. The same evidential source indicated that these elites were confident that they would win this war of annexation and aggressive exploitation. It was also their intention to enforce the defeated countries to pay for the enormous cost of this – by then – mechanised form of total war. As additional evidence of this intention, consider the following extract from a 1915 memorandum signed by almost 700, top German industrialists, bankers, business men, university professors, state officials, generals and admirals,  before their final defeat in 1918;

“We must ruthlessly impose a heavy war indemnity on France…And we should be in a position to impose an indemnity on England, no sum would be too great.” (quoted in Germany from Defeat to Conquest. WM Knight-Patterson. page 308.)

In the previously article it was established that the First World War was prompted by  the clash of rival capital circulation and accumulation among European concentrations of this form of wealth.  However, the defeat of Germany in this 1914-18, armed ‘collision’ had not solved the problem of Germany’s geographical boundaries being ‘too narrow’ and its colonies ‘too few’, to contain its animated and competitive capitalist form of economic production. Germany had in this First World War failed to acquire ‘new territories for settlement’ and had lost its pacific bases. Nor had this defeat eliminated the internal discontent of the German masses. Indeed, both problems had been exacerbated since on top of the internal costs to its economy, it was Germany which now had to pay indemnity to the allies.

Inflation – a pro-capitalist tool for survival.

The German capitalist elite solved this particular indemnity problem by allowing (and encouraging) inflation to rise dramatically. In mid-1918 the exchange rate was such that it took 4 German marks to purchase 1 US dollar. By September 1923 13 million Mark’s were needed to purchase 1 dollar and that was not the worst exchange rate. In other words the German capitalist elite were able to pay their debts (including indemnity payments) with an increasingly worthless currency. For the capitalist classes, this self-interested strategy had a fortunate set of side effects which helped their other problems. Inflation also undermined the wages of the workers and eroded the wealth of the middle-classes, both of whom then looked for scapegoats to blame. It couldn’t be made clearer than the following:

“In other words, the inflation was an easy means for the industrialists and junkers to enrich themselves at the expense of the workers and middle-classes, while directing the hatred of the dispossessed against foreign countries. It was an excellent mechanism to reduce the working masses to destitution, to subject them to shameless exploitation, and at the same time create an atmosphere of rabid nationalism.” (Germany from Defeat to Conquest. WM Knight-Patterson. page 308.)

The success of this nationalistic blame-game over the effects of the capitalist inspired war had dire consequences for the working-classes of both capitalist alliances. These consequences and events led, during the inter-war years, to the rise of the National Socialists Party (the Nazis) and later to the outbreak of the Second World War. Another consequence of the success of nationalistic ideology was that German based capital along with Anglo-Saxon based capital was still intact and was still capable of producing more commodities and services than could be profitably consumed by the home market. So in one sense despite the massive sacrifices of human life, nothing had changed, except the realisation that capital can even survive total war!.

Capital’s needs created another World War.

The First World War convincingly proved that capital and capitalists could survive total war and prosper whether they win or lose the ensuing rivalry battles. This was despite a level of warfare which devastated and even annihilated the lives, welfare and infrastructure of citizens under its control. The capitalist essence of the ‘system’ survived – albeit in a modified form. Shortly after the First World War, capitalists still needed to expand their production and market their products and this involved the increased consumption of raw materials and labour.

So in 1925, when Hitler wrote what follows in his rambling rant of a book ‘Mein Kamf’, we can understand that he was merely regurgitating – in his own particularly racially politicised form – the previously held view that Germany still desired an Empire as large, if not larger, that that operated by the British. Britain being one of the states whose activities  embraced ‘entire continents’.

“In an era when the earth is gradually being divided up among states, some of which embrace almost entire continents, we cannot speak of a world power in  connection with a formation whose political mother country is limited to the absurd area of five hundred thousand square kilometres.” (Hitler. ‘Mein Kamf’. Section 14 of Book 2.)

The only slight modification Hitler made at that particular moment in time, to this earlier genre of capitalist/nationalist thinking, was to down-play the desire to acquire exploitable ocean-based colonies. Hitler, his financial, industrial backers and advisers, realised that unlike the 19th century, in the 20th century, the conquest and control of distant colonies first required a continental empire of considerable size. Large-scale land-based material and taxation resources, along with a willing industrial and agricultural population, were necessary in order to achieve this sea-dependent expansionist ambition. So for this reason he and his acolytes set his and his countries citizens sights on expanding on land to the east and on achieving internal social ‘order‘.

How the German capitalists and pro-capitalists achieved sufficient internal stability to create the basis for renewed economic expansion and its eventual subordination to re-armament and warfare is a complex question. It is one which will be considered in a further article. For the present I shall focus on the economic factors that once again drove the unfolding logic of German capital and how this was understood by a considerable spectrum of the German elite. Among that post-war pro-capitalist elite were the same liberals and ‘socialists’ who had betrayed the resolutions of the Second International and voted for war credits. This is how one ‘socialist’ deputy had previously expressed the implicit economic needs of capital dressed up explicitly as the emotional needs for retaining territory gained in previous conquests.

“In the name of the Social Democratic representatives of the German territories…..I have to make the following statement……we raise our voice…to protest against the separation of our homeland from the Motherland……We shall also not abandon the hope as long as we live that sooner or later the territories detached from their homeland by the decree of a short-sighted and hate-imbued victor, will be returned to the Fatherland.” (Deputy Hoersing. June 1919. quoted in ‘Germany from Defeat to Conquest. WM Knight-Patterson. page 206.)

The lack of a critical recognition of just how these territories had militarily come under the control of Germany in the first place, clearly shows, among other things, that by this time the term ‘socialism’ had become a left-wing camouflage for a part of the bourgeois political spectrum – as it still is!  This new generation of ‘bourgeois socialists’, took for granted the capitalist mode of production and the best they could desire for workers was the following: Wages that did not pauperise workers; and conditions that kept them healthy. Both of which enabled the owners of capital to extract sufficient surplus-value to satisfy their private greed and the continued self-expansion of their capital investments, whilst staving off revolution.

War again – with a lot of help from capital’s friends.

This type of collusion with the capitalist and pro-capitalist elite and their needs also extended to the trade union movement. In November 1918 when mass demonstrations of workers were taking place in Germany a meeting took place between socialist trade unions and industrialists. At that meeting a document was signed by both sides agreeing to give each other mutual support in order to keep the factories operating normally. In other words, the ‘official’ labour movement was completely wedded to the continued existence of the capitalist mode of production. This cannot be too surprising! After all it was this ‘mode’ of economic activity which created their privileged ‘positions’ and their lucrative salaries.

This collaboration of the ‘socialist’ and social democratic left with capitalism in Germany continued throughout the inter-war period as did the machinations and intrigues of ‘big capital’. So a number of years later, after the use of emergency powers granted by Article 48 of the Republics Constitution,  when these intrigues had become involved with Hitler and the National Socialists (Nazi’s) other things  cannot be entirely surprising. For example, reading the following extract from a statement by one of the largest owners of industrial capital in Germany, should not be surprising coming as it did from the owner of large-scale capital – in this case steel and armaments production.

“On 20th of this month I expressed to Reich Chancellor Hitler the gratitude of approximately twenty-five industrialists present for having given us such a clear picture of the conception of his ideas.” (Alfred Krupp. Quoted in ‘The Arms of Krupp’. W. Manchester, pub. M. Joseph. page 407.

That clear picture later included the full collaboration of the state and private capital in the re-construction and re-armament of the German War machine. Designed and constructed as it was in order to fulfil the needs of the capitalist mode of production for territorial expansion and control of raw material resources and markets. This collaboration also included the complete subordination and ultra-exploitation of the entire working classes, white-collar and blue, industrial and agricultural, to these self-expansionist needs of capital.

As noted previously, how this subordination of ‘labour’ was achieved is the subject of a future article but the motives of both the political Fascists and the economic elites were in complete harmony over the war aims of the Third Reich.  Commencing with annexations and Blitzkrieg conquests German capital for a second time shaped up for a war for global domination and control of resources and markets against the still dominant Anglo-Saxon  economic empires of Britain and France.

And of course, both sides elites dragged the rest of humanity into its bestial competitive war for global economic and financial domination. A study of modern history demonstrates that in periods of systemic crisis, the capitalist and pro-capitalist elites have pursued this course of ‘total’ military action twice before on a global scale and unless stopped will probably try to do it again.

Roy Ratcliffe (November 2014.)