WHY THE GERMAN REPUBLIC FELL
By Bruno Heilig
Bruno Heilig was an Austrian journalist, foreign correspondent and editor. Two days after the Anschluss of Austria to Hitlerdeutschland, he was arrested on 15 March 1938 and brought to Dachau concentration camp with other prominent Nazi opponents. Released after thirteen months, Heilig fled to London where he wrote this piece in 1941. Seventy-eight years on, it carries warnings of the rise of Fascism and bears remarkable similarities to current world economic events.
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NUMBERLESS NEWSPAPER articles and books have been published on the subject of Hitler’s career and Germany’s turning to barbarism. They describe in minute detail the comings and goings of the actors of that tragedy; they reveal secrets about political and diplomatic interview, about intrigues and conspiracies too. They give you a more or less reliable picture of the character of the leading persons and entertain you, perhaps, with spicy stories about their private lives. You get splendidly informed, yet you are not satisfied. The more you have learned about the events the more you are puzzled. There was a country with a fine democratic constitution built on the ideas of liberty and self-government. Its people had been glad to get rid of the Kaiser after the Great War, and had elected for the Weimar National Assembly men whose records and programmes offered the best guarantee for a radical extirpation of the hated old Prussian ideas.
Then some crooks, some fools, and some weaklings appeared on
the stage of history, and liberty was thrown away, and democracy became
rubbish. Hitler attained power under observance of a democratic constitution,
the fundamental principle of which was self-government and self-determination
of the people. He became Chancellor just in the same way as any of his
predecessors, by regular appointment. There was no reason why the people should
submit to tyranny against their will. They followed the tyrant voluntarily,
many of them jubilant. How did it happen, how could it happen?
There are, I know, a number of explanations, ranging from
the failure of the Allied nations to implement their pledges in the Versailles
Treaty, and their folly or guilt in thereafter pursuing illiberal policies, to
the alleged innate militarism of the German people which only awaited another
brand to set that spirit in flame. These ideas can be argued to Doomsday,
unavailingly, if one takes no account of the social forces that were disrupting
Germany from within; internal causes so potent that they deserve far more
attention than most students of the German–and of the European–scene have
chosen to give them.
THE INDUSTRIAL BOOM
After the disastrous years of the inflation, business revived almost suddenly. With the re-establishment of the gold value of the mark (equal to the full gold value of the English shilling) stable conditions for security of investment became possible, and Germany needed capital badly. The whole industrial equipment which had been engaged in war work for four years had been lying practically idle during the inflation period. There was also an enormous demand for dwelling-houses, not more than some few hundred houses having-been built all over Germany during the previous ten years, and population had increased in spite of the war, and was still increasing.
German enterprises got as much support as they wanted from the United States, where bankers were at a loss to know what to do with the gigantic amounts of money that had been accumulated during the war. The recovery which started in Germany in 1924 had all the elements of an investment boom. Factories scrapped their old plant and replaced it with up-to-date machines. Germany was going to become the most advanced industrial country in the world, surpassing even the United States. Busy times drew millions of people to the big towns, the population of greater Berlin increasing rapidly by two millions to six and a half millions.
The public bodies rushed in also to participate in the
feverish building up of a new and modern Germany. The whole rail-traffic system
was reorganized and re-equipped. In Berlin, rows of houses we’re demolished to
broaden the streets. In the heart of Berlin the Alexander Platz was to become
the largest square in the world, surrounded by the most modern skyscraper
office buildings.
The most urgent
problem to be settled was, of course, that of erecting buildings for dwelling,
industrial, and trading purposes. The technical problem was speedily solved.
They simply made buildings in factories, the concrete blocks and plates
ready-made being assembled and joined together on the site where the building
was to go up. You could see posters on the growing skyscrapers proclaiming:
“A storey a day”!
Prices and rents of land soared at once, and so, too, rose
the cost of building materials, with manufacturers protected against foreign
c0mpetition by high customs duties. The
price of iron was double that in England at the time, and cement was three
times as high. Land prices rose on the average by 700 per cent in Berlin and-by
500 per cent in Hamburg, within six years. But in some districts of the capital
the increase· amounted even to 1000 per cent or more. It was “good
business” to be on good terms with members of the city Council, the Stadtrat.
If for instance you had timely information about the plan to connect the
Zehlendorf outskirts with Berlin by a new Underground line, or if you secretly
learned that there was to be a new line to the Reichskanzler Platz, the shrewd
purchase of but a few hundred square feet of ground would bring you a fortune.
And you could become even a millionaire if you were in the know that Herr
Reuter, Berlin’s traffic dictator, intended to enlarge the Alexander Platz and
to have a gigantic central Underground station built beneath it.
SPECULATION IN LAND VALUES
Land speculators had a fantastic time, some doubling or
trebling their fortunes overnight. While the common people toiled feverishly
and proudly to build up the new Germany that should be the world’s most
advanced community, money poured into the pockets of those who gambled in land
values.
The high rents for flats and premises in the new buildings
reacted upon and forced up the rents in the old ones. During the war, rents had
been fixed by law at the pre-war level, and that law had remained in force
during the whole period of the inflation. Suddenly the newspapers began an agitation
that it was unjust to maintain the great difference between the rents in the
new and in the old buildings, and this was so successful that an amended law
permitted the proprietors of pre-war buildings to raise rents up to 125 per
cent of the pre-war level. It was a generous gift. Already the proprietors had
got rid of three quarters of the burden of their mortgages, the valorization
law passed after the inflation stipulating that they were responsible for only
25 per cent of the gold value of the bonds. Thus they were getting more than
their full pre-war rent in terms of gold marks and, in addition, quittance of
75 per cent of their mortgages.
Experts estimated the increase in rents in respect of dwelling-houses alone at 1200 million marks (say, £60,000,000) a year for the whole Reich. It is impossible, of course, to give any approximate figure of the burden which was heaped upon production and trade by the enormous rise in the rents and prices of land used for industrial and mercantile purposes.
The people had not only to pay this tribute to the land
monopolists, they also had to finance the business, thanks to the strange
policy of the representatives and the corporations of the cities and towns. In
Hamburg for example the taxpayers had to subscribe 60 million marks in
compensation to owners, and were further made to pay 40 million in subsidies to
builders of houses. After these schemes were carried through, rents all over Hamburg
went up by 20 million marks per annum.
Berlin spent upon land-buying no less than 400 million
marks, of which 120 millions were invested in purchase around the Alexander
Platz. This business turned into a big scandal of speculation and corruption.
The sites for which the city paid 120 million marks had been valued at 35
millions previous to the purchase. The excess of 85 million marks was actually
regarded–in addition to the original 35 millions–as the rightful property of
the vendors because that would be the value given to the land by the
expenditures of the taxpayers’ money on the improvements about to be made; the
vendors should not be deprived of this value added to their
“property.” It has to be said, too, that the city officials of
Berlin, entrusted as they were with the defence of the city’s interests, lent a
hand to that speculation – and not disinterestedly. It was a kind of legal
corruption and bribery. In cases where the landowners refused to sell to the
city, or would not accept the price offered, an arbitration committee had to
decide. This committee was composed of two representatives of each party and
one neutral chairman. Many cases came before such committees who regularly
declared that the city council had to pay not only the actual value of the site
but any value the site was likely to have in the proximate future, no matter
what caused the value to increase. I remember the exact data of one such case
which was the most disgraceful of all. The proprietor of the site valued his
property at 400,000 marks. The city council considered the price too high and
submitted the case to arbitration. The decision was that the city had to pay,
not the 400,000 marks the owner had wanted, but no less a sum than 1,080,000
marks, this being the arbitrators’ estimate of the value the site would have
after the city had made the traffic improvements it had planned. Now, the
scandalous side of the transaction was this; the fee payable to the members of
the arbitration committees was a certain percentage of the determined price,
and it was therefore in their personal interest that the price should be as
high as possible. What they awarded the vendor was also their reward. Moreover,
the city council appointed their own representatives upon the arbitration
committees from that city committee which had to decide which were the cases to
be submitted to arbitration.
Another case of flagrant corruption was the leasing of the
Berlin river-harbour basin to a private firm. It took place near the end of the
inflation period, when well-informed people already knew what was going to
happen after settlement of the money question. The port of Berlin is, after
Duisburg, the largest of its kind in Germany. It is situated on the rivers
Spree and Havel, which fall into the rivers Oder and Elbe respectively, and
thus connect Berlin with the sea. The city council spent millions upon millions
on the completion and equipment of the basin with huge warehouses and the most
modern means for loading and unloading. When all was finished, Herr Schuning,
who as city official was in charge of the basin, reported that it could not be
operated with profit to the city but would require a considerable subsidy, and
he therefore recommended that it be leased to a private firm. An accommodating
firm was soon formed as the Berlin Port and Warehouses Ltd., by the Busch Wagon
Factory and the transport agents, Schenker & Co. To that company the
council leased the whole basin with all its fine warehouse and other equipment for
fifty years against payment of 369,000 marks, not an annual rent, but a outright
purchase of the lease.
The area of the basin was one million square metres and the
rent of the bare land in that neighbourhood was one mark per metre per year.
The company, therefore, paid for the fifty-year concession only a 150th of what
they should have paid in rent for the land alone. In addition, the city council
granted to the company a loan of 5,000,000 marks for working capital. Exactly
twelve months after the signing of the contract, Herr Schuning was appointed
director-general of the company. With the port of Berlin under their control,
the promoters of this company controlled all supplies coming to Berlin, and the
Berliner had to pay them tribute for every bit of bread he ate.
Such in brief is part of the story of the land racket in the
cities and towns. There remains to give some description of what happened with
regard to agricultural and mineral-bearing land.
THE AGRICULTURAL LAND
Half the area of the agricultural land in Germany is taken
up by large estates which are in the hands of the old military nobility, the
Junkers. The other half is cultivated by peasants, the number of peasants being
nine times as great as the number of Junkers.
The large estates employ 2,500,000 persons; by contrast, those engaged in work on the peasants’ farms (peasants and their dependants and paid labourers) number 7,500,000. The large estates have always been befriended by governments because they chiefly grow corn, which is so important in war-time. They were protected by high customs duties and were favoured by reduced taxation.
After the War of 1914-1918, the question of land reform was
much discussed in Germany. The republic, peace-loving and led by socialists,
was expected to make a radical departure from the old economic ideas. Millions
of soldiers being demobilized could have been settled and the agricultural
output could have been greatly increased, since according to official
statistics the value of the output of the small farms was up to 47 per cent
higher than that of the large estates; in dairy farming even up to 69 per cent
higher. After years of fatigue and starving, the physical condition of the
people also needed improvement. Again, the statistical data were definitely in
favour of the small farms. In countries where conscription is in force the
state of health of the people is reliably shown by1 the proportion of those fit
for military service, which on the small farms exceeded that of the people
working on the large estates by no less than 150 per cent.
THE “HELP FOR THE EAST” AND THE JUNKERS
But nothing happened. No land reform was initiated, nothing
but some timid steps towards market gardens and allotments near the cities and
town. When, later, owing to the competing imports from the grain-growing
transatlantic countries and to the fall of corn prices on the world market, the
Junkers got involved in difficulties, the government helped them handsomely.
Customs duties on corn and fodder were raised, which was a heavy blow to the
small farmers, increasing the cost of stock-farming. In addition, what is known
as the Osthilfe (the “Help for the East” to the landowners of East
Prussia) was granted by Parliament, amounting to 500,000,000 marks (£25,000,000)
cash subsidies to relieve the estates encumbered with debts and to modernize
the equipment. Even so the Junkers were not satisfied; they demanded and got
more subsidies. I have the official figures for the year 1931. In that year
alone they were paid 100,000,000 marks for storing corn, withholding it from
the market in order to keep its price high. That meant that the people had to
pay more taxes in order that they should pay dearer for bread. In the same year
the interest on the debts of the Junkers was reduced by 365 millions and they
were given tax relief of 160 millions. With various other subsidies added, the
agrarians were presented with more than 1000 million marks (£50,000,000) in
that year 1931! And with all that money in their pockets they eventually
extorted from the Reichstag the famous, or infamous, law which generally
prohibited the collection of debts from the agrarians.
Under such conditions the value of agricultural ground of
course rose enormously. I have no exact figures for those years, but data of
previous years will show how, as to one form of subsidy, protective tariffs are
reflected in the increased rent of land. From 1892 to 1906 corn duties were
stable in Germany and ground prices increased during the same period by 18 per
cent, a figure which may correspond to the normal rise resulting from the
increase of population and the improvement of production. In 1906 import tariffs
on corn were doubled. At once the prices of ground belonging to large estates
jumped by 200 per cent, with which trebling of the fortunes of Junkers is to be
compared the increase of only 10 per cent in the land value of the small farms.
After the law was passed prohibiting foreclosure of mortgages there were no
ground prices at all in Germany for the simple reason that no one was so
foolish as to offer to sell a single foot of land. The monopoly was complete.
The mines of Germany have been owned partly by big companies
and partly by some aristocratic families. The masters of that part of the
German land were as effectively buttressed and aided as the Junkers. I have
already mentioned the enormous prices that the people had to pay for iron and cement.
The price of coal in Germany was also twice as high as in England. In addition,
heavy industry also got its millions of marks in subsidies. I refer to only
some outstanding cases : The Upper Silesian Foundries got 36 millions, the
Lower Silesian Mining Co. 11 millions, the Rochling Concern 37 millions, the
Mansfield Co. 16 millions, the Siegerlander Metal Works 10 millions, and Ruhr
Mines 25 millions.
You may ask why the people tolerated all this.
The answer is that he who holds the land holds the real
source of power. Germany has actually been ruled by 12,000 Junkers and some
hundred aristocrats. With their own votes, they would not have succeeded in getting
a single seat in any legislative body. Yet their parties, the German National
Party and the German Peoples’ Party, managed to get more than 100 members into
the Reichstag. In Prussia, which covers two-thirds of the Reich, the relations
between the landowners and the people had hardly changed since the time of
serfdom, the people voting as the landlord wished they should.
Skilled in ruling for centuries, the landowners quickly
accommodated themselves to changing political conditions. After the breakdown
of the Hohenzollern regime, they were tolerant of common people occupying
government posts, and they even consented to the Constitution which was said to
override their privileges and make the landlord formally equal to his labourer.
But they maintained their influence undiminished. With the toiling folk on
their estates and in the remote villages, no trouble was to be feared; the
“normal” means of pressure which are at the disposal of the landowner
(and tradition) were sufficient to keep them down. They used modern and
politically democratic methods to harness the townsfolk and the band of
republican bosses to their chariot. The biggest newspaper and news service
establishment was theirs. It was the Hugenberg Concern, which published the
well-known Berliner Lokalanzeiger and some periodicals and the notorious
“Generalanzeigers” (General Advertisers), cheap daily papers made up
to the taste and the level of the man in the street which Hugenberg bought up
after the War and established in every town. Moreover, he organized the
Telegraph Union, which provided thousands of newspapers all over Germany with a
splendid news service, and the service which supplied feature articles and even
entire Sunday supplements in matrices ready for print and therefore
unalterable.
I need not explain what that propaganda organization meant
in operation. Its effect was to sway public opinion into believing that the
interests of the landowners were the interests of the nation. Subsidizing the
landlords was the accepted policy for preserving and even saving the sources of
subsistence of the people: the higher tariff walls were for the benefit of the
wage-earning population: increase in land values meant increase in the national
wealth: and so on. There were also, of course, in Germany independent
newspapers, some of them of a high level and distinguished. But on the one
hand, none of them realized the true position, and on the other hand all of
them were, to a certain extent, terrorized by ‘the ruthlessness of the
Hugenberg propaganda which had monopolized patriotism.
INDUSTRIAL COLLAPSE
The industrial boom lasted for about seven years. Again and
again, intelligent men stood up and warned against the inevitable consequences
of what was going on. I remember having read a book discussing the situation as
early as in 1925 only a few months after the great boom had started. The author
was definitely right from a point of view of what is called the capitalist
system. He explained that standardizing industry would mean the loss of its
elasticity of calculation. The invariable part of the costs of production, that
is to say, the debt charges for land buildings and equipment, would increase
enormously and the variable part, wages, would decrease correspondingly. The
producers would become quite helpless in time of lessening demand. Normally,
they had been able to meet a crisis by reducing wages and laying off their labourers,
but overhead charges had to be paid without regard to boom or crisis. If demand
fell, the author argued, prices would have to go up and the whole amount of
overhead charge would weigh upon a smaller amount of goods produced; yet rising
prices must inevitably lead to another decrease of demand and so on, in a
vicious circle.
The author demanded that a limit be set to rationalization, and others were just as emphatic. If right from their point of view, they were absolutely wrong from the point of view of sound economic thinking. The advance of industrial production must not and cannot be stopped; it has gone on ever since somebody made the first primitive tool. To try to prevent men from improving the means of production is as crazy an effort as to try to stop men breathing. No doubt under the conditions existing in our world, rationalization has to lead to a disastrous effect similar to that predicted in the book mentioned; but the only right conclusion was to alter the whole structure of German economic life, an idea however which was taboo. Thus, Germany’s destiny took its fatal course. From the very beginning we can trace how the boom in industry was impelled and speeded and intensified as land values rose, and then how the further speculation in land values rendered it definitely absurd.
The flow of capital which came over from America would have
been of no use if there had not been hands to make the new machines. Now, in a
country where a large portion of the land is covered with large estates there
is always abundance of people seeking employment. I pointed to the fact that in
Germany 7,500,000 people were engaged in working on the smaller farms and only
2,500,000 on the large estates though the two parts of the cultivated land were
equal in extent. Thus the existence of big estates made a difference of
5,000,000 people in the “labour market.” Wages were low and low wages
will stimulate industrial investments. The increase of ground prices proved
another incentive to investments and intensified the rationalization. But high
ground prices increase the cost of living and he who continues to employ labour
has to provide for its regeneration whether he likes to or not. The labourers
began to press for higher wages. The employers were in a difficult position.
With high prices for the ground on which their factories were built, high
prices for building material and coal, increasing taxes weighing heavily on
their budgets, how could they bear the burden of rising wages? They decided to
speed up the modernization of their equipment, to get rid of those expensive
workers as quickly as possible; in other words, “to rationalize.” Yet
in doing so they caused ground prices to rise still higher and the cost of
production rose again–another vicious circle.
Germany was in a state of intoxication at that time.
Modernize, modernize at all costs, was the only idea that people could
entertain. In 1930 the first signs of a crisis became manifest. Labourers stood
off by machines met with difficulties when looking for other employment.
Industrialists and merchants complained of difficulties in selling their
merchandise. The position deteriorated month by month, week by week. In 1931
the crisis was in full swing. The ordinary means to meet the crisis had failed.
By restriction of production things went from bad to worse. Amortization,
rents, interest, taxes ate up everything. Workers were dismissed en masse
but the employers hardly felt any relief in their budget, and in any case with
every worker lost to employment a consumer had been lost as well. The number of
unemployed went up by tens of thousands, then by hundreds of thousands, and the
number of bankruptcies mounted correspondingly.
If those wise men I have mentioned had not stopped thinking
at the point where they left off they might have reached the right remedy
instead of recommending a halt to industrial progress. Had they only reflected
a little upon the meaning of the word “invariable costs”! Whence came
these costs, or to whom were they to be paid? Land speculation had anticipated
all possible increase of production and had forestalled all the value the land
might have decades hence. The mine-owners had doubled and trebled the price of
their products so that the bare costs of building had risen to 180 per cent of
the highest pre-war costs in spite of the new labour-saving methods. Taxes were
extraordinarily high because the State and the city had to redeem the costs of
dearly bought land and generously built roads and railways, or a splendid
river-harbour like that in Berlin, the owners of which were now extorting
inordinate transport fees out of the working people. All had gone to the
landowners: that was the true meaning of the term “invariable costs.”
One had worked for them during all those years. The breakdown of the German
banks in the summer of 1931 further proved the truth of the theory of the
invariable costs. The industrialists and the merchants were unable to meet
debts and interest and therefore the banks had to stop payment. Yet the debts
in question were nothing other than the capital invested during the prosperity,
that is the money the landowners had swallowed. The invariable costs had
quickly become insupportable and were simply not paid.
The Government rushed in to help the banks, which got accommodation
at the expense of milliards of marks drawn from the people’s taxes. Then began
the flow of other subsidies, as those to the Junkers and the heavy industry to
which reference has been made, and light industry had also to be subsidized by
way of helping it to meet those “invariable costs. ”
The crisis grew, ever deepening. Futile expedients were
adopted in the effort to stem it. Although it was obvious that the
“invariable costs”–i.e. the tribute land monopoly exacts from the
working people–were eating into all production, the responsible men and the
leading exponents of what was taught as economics kept their eyes, as if under
some hypnotic influence, fixed upon the worker’s pay-packet. Herr Bruning, then
Chancellor, declared for the so-called deflation policy which involved a
general reduction in rates of wages, and wages were reduced by 15 per cent.
This it was contended would decrease commodity prices, so stimulating
consumption and decreasing unemployment. Herr Bruning and his advisers failed
to see (1) that, even if the decrease in prices was equivalent to the decrease
in wages, the amount of goods produced would remain as before and such a scheme
could never result in finding new employment for the workers who were in search
of it; and (2) that reduction in wages cannot induce a corresponding reduction
in prices since prices are so largely determined by factors other than wages.
Herr Bruning ought to have cut down the rents of land and rather raised than
lowered wages, which would have loosened the Gordian knot and brought the
needed relief.
FROM POPULAR GOVERNMENT TO DESPOTISM
Seven million men and women (one-third of the wage-earning people) unemployed, the middle class swept away: that was the position about one year after the climax of prosperity. Progress, conditioned as it was, had rapidly produced the most dreadful poverty. Germany, it seems to me, has provided a striking example supporting the theory that the private appropriation of the rent of land is the fundamental cause of industrial depression and of distress among those who labour in the production of wealth-the theory expounded by Henry George in his Progress and Poverty, a theory that some professed teachers of social science have been strangely slow in accepting, whether from ignorance or prejudice is for them to say. For my part, a conclusion has been arrived at not by prior theoretical study but rather by attendance upon the circumstances I have recounted. It was not until I had arrived in England as a refugee journalist that by good fortune the book fell into my hands, to be read with increasing interest and excitement for the light it shed upon what I had seen taking place. The economic demonstration was complete, at least I could discover in it no defect. Yet why had Germany taken the road from individual political liberty through mass hysteria to the surrender of all liberty and the despotic “leadership” of one man? Was there a link between the economic and the political collapse? Emphatically, yes. For as unemployment grew, and with it poverty and the fear of poverty, so grew the influence of the Nazi Party, which was making its lavish promises to the frustrated and its violent appeal to the revenges of a populace aware of its wrongs but condemned to hear only a malignant and distorted explanation of them. In the first year of the crisis the number of Nazi deputies to the Reichstag rose from 8 to 107.
A year later this figure was doubled. In the same time the
Communists captured half of the votes of the German Social Democratic Party and
the representation of the middle class practically speaking disappeared. In
January I933 Hitler was appointed Reichskanzler; he attained power, as I said
before, quite legally. All the forms of democracy were observed. It sounds
paradoxical but it was in fact absolutely logical.
This I realized with all the more conviction from my reading–after the event–of that book written sixty years ago. It was as if history had been written in advance, the thought impressing me that, by simply by altering the tense of verbs from the future to the past, one could turn the form of prophecy into a narrative of fact and get a correct story of the situation in ciivilized countries as it actually develops. With my intimate acquaintance of life and labour in Germany, those passages were naturally most absorbing which seemed to me to portray the kind of men who would become the leaders of starving and desperate peoples. In the Introductory to the book, you already meet them in the reference to the fallacious ideas in current economic teaching which “bring great masses of men, the repositories of ultimate political power, under the leadership of charlatans and demagogues”; and in the chapter “How Modern Civilization may Decline” there is hardly a page or a paragraph which does not apply almost literally to the happenings in Germany itself. The inevitable effect of poverty on political developments under popular government is stated in this quotation:
To put political power in the hands of men embittered and
degraded by poverty is to tie firebrands to foxes and turn them loose amid the
standing corn ; it is to put out the eyes of a Samson and to twine his arms
around the pillars of national life.
When the disparity of condition increases, so does universal
suffrage make it easy to seize the source of power, for the greater is the
proportion of power in the hands of those who … tortured by want and embruted
by poverty are ready to sell their votes to the highest bidder or follow the
lead of the most blatant demagogue ; or who, made bitter by hardships, may even
look upon profligate and tyrannous government with the satisfaction we may
imagine the proletarians and slaves of Rome to have felt, as they saw a Caligula
or Nero raging among the rich patricians.
To turn a republican government into a despotism the
basest and most brutal, it is not necessary to formally change its constitution
or abandon popular elections [for] forms are nothing when substance has gone,
and the forms of popular government are those from which the substance of
freedom may most easily go. Extremes meet, and a government of universal
suffrage and theoretical equality may, under conditions which impel the change,
most readily become a despotism. For there despotism advances in the name and
with the might of the people.
No doubt in all political changes the national character
also plays its part. Yet particular circumstances really provoke the reaction.
I do not believe that the Germans would have followed Hitler in his hates and
revenges if the people had been living under reasonably good social conditions
instead of being as they were under the lash of so much unemployment and
privation. True, Adolf Hitler may be the particular German specimen of what
Henry George calls the most blatant demagogue. But do you consent to Mussolini,
the Latin-speaking tyrant? And what about Norwegian, Dutch, French, Hungarian,
Roumanian and Bulgarian fascists? The German people–or a large proportion of
them–were only the first to follow Hitler. Others joined in later under the
lead of their most blatant demagogues.
All Europe is either Communist or Fascist, with few
exceptions. It was not fear or downright political stupidity that prevented so
many European countries from joining in the fight against Hitler, and it was
not mere incompetence that defeated France. It was the strong Fascist forces
existing in those countries and the influence of the respective blatant
demagogues (though not yet in official power) that paralysed the peoples; and
the outcome is that the superlative of all the blatant demagogues has become
the leader of the lot. Thus, national character is but of subordinate effect.
The circumstances are the determining factor.
THE LESSON-DEMOCRACY DESTROYED BY SOCIAL INEQUALITY
The unequal distribution of wealth makes government corrupt,
and “a corrupt democratic government must finally corrupt the people, and
when a people become corrupt there is no resurrection.” I have dealt with
only some outstanding cases of corruption and have not mentioned any of the
many cases not directly connected with the land question. But I believe I have
shown that corruption was the essence of what was called German economic life;
and corruption naturally became the feature of political life as well.
Money also was the chief weapon the enemies of democracy
applied to overthrow democracy. Germany’s masters, the owners of agricultural
and industrial land, the Junkers and the Ruhr industrialists, had no actual
love for Nazidom as such, but they were willing to use it to destroy the hated
Republic. “A mere aristocracy of wealth will never struggle while it can hope
to bribe a tyrant,” which is just how the German landlords behaved.
Nazidom was financed as everyone knows by the heavy industry in the first
place, but the Junkers also contributed to the millions of marks which were
paid to the leaders of the Nazi Party. It is interesting to notice how quickly
the old German aristocracy had accommodated itself to customs that had been
strange to them. They did so because with the abolition of privileges they had
really turned into a “mere aristocracy of wealth,” and it proves
their highly developed political instinct that they at once realized the new
position and acted accordingly. It is a particularly ironical side of the
story, that the landlords bought Nazidom with part of the money they obtained
from the Republic both in cash subsidies and through the rise in land values.
The State had provided its enemies with everything they needed for its
destruction: with progress, with popular government, and with the material
funds necessary to achieve the thorough organization of tyranny. The wall
painter and corporal was of course not to the taste of the German landlords but
in the most important problem he has not betrayed his sponsors. He did not touch
the land problem. He only added to the class of Junkers that of the
“Erbhofbauern” (peasants owning land under entail and prohibited from
mortgaging), thus creating a new hereditary class of middle-sized land
monopolists. So we see how the land question repeatedly got into the hub of
political life at every, turn as the German · Republic drove to its fate.
Similar conditions will be of the same effect everywhere. What happened in Germany will inevitably happen anywhere that similar conditions prevail. In some Continental countries it has happened already. The Nazi regime is not Hitler’s, the man’s, achievement. Nazidom has grown organically out of a rotten democracy, and the rottenness of that democracy is the natural consequence of unequal economic conditions; and unequal economic conditions obtain all over the world owing to the instituted private appropriation of the rent of land. Therefore, every country is potentially a Fascist country. Germany is but the type of a development which no country can escape except by the establishment of the equal right to the occupation and use of land. Therefore also, there can be no lasting peace even after the defeat of Nazism if the present economic structure of the civilized countries remains.
The private appropriation of the rent of land is the deadly enemy of mankind.