November 11, 2005
DUH?:
Why Nazism Was Socialism and Why Socialism Is Totalitarian (George Reisman, November 11, 2005, Mises.org)
[A]part from Mises and his readers, practically no one thinks of Nazi Germany as a socialist state. It is far more common to believe that it represented a form of capitalism, which is what the Communists and all other Marxists have claimed.The basis of the claim that Nazi Germany was capitalist was the fact that most industries in Nazi Germany appeared to be left in private hands.
What Mises identified was that private ownership of the means of production existed in name only under the Nazis and that the actual substance of ownership of the means of production resided in the German government. For it was the German government and not the nominal private owners that exercised all of the substantive powers of ownership: it, not the nominal private owners, decided what was to be produced, in what quantity, by what methods, and to whom it was to be distributed, as well as what prices would be charged and what wages would be paid, and what dividends or other income the nominal private owners would be permitted to receive. The position of the alleged private owners, Mises showed, was reduced essentially to that of government pensioners.
De facto government ownership of the means of production, as Mises termed it, was logically implied by such fundamental collectivist principles embraced by the Nazis as that the common good comes before the private good and the individual exists as a means to the ends of the State. If the individual is a means to the ends of the State, so too, of course, is his property. Just as he is owned by the State, his property is also owned by the State.
But what specifically established de facto socialism in Nazi Germany was the introduction of price and wage controls in 1936. These were imposed in response to the inflation of the money supply carried out by the regime from the time of its coming to power in early 1933. The Nazi regime inflated the money supply as the means of financing the vast increase in government spending required by its programs of public works, subsidies, and rearmament. The price and wage controls were imposed in response to the rise in prices that began to result from the inflation.
The effect of the combination of inflation and price and wage controls is shortages, that is, a situation in which the quantities of goods people attempt to buy exceed the quantities available for sale.
Shortages, in turn, result in economic chaos. It's not only that consumers who show up in stores early in the day are in a position to buy up all the stocks of goods and leave customers who arrive later, with nothing — a situation to which governments typically respond by imposing rationing. Shortages result in chaos throughout the economic system. They introduce randomness in the distribution of supplies between geographical areas, in the allocation of a factor of production among its different products, in the allocation of labor and capital among the different branches of the economic system.
In the face of the combination of price controls and shortages, the effect of a decrease in the supply of an item is not, as it would be in a free market, to raise its price and increase its profitability, thereby operating to stop the decrease in supply, or reverse it if it has gone too far. Price control prohibits the rise in price and thus the increase in profitability. At the same time, the shortages caused by price controls prevent increases in supply from reducing price and profitability. When there is a shortage, the effect of an increase in supply is merely a reduction in the severity of the shortage. Only when the shortage is totally eliminated does an increase in supply necessitate a decrease in price and bring about a decrease in profitability.
As a result, the combination of price controls and shortages makes possible random movements of supply without any effect on price and profitability. In this situation, the production of the most trivial and unimportant goods, even pet rocks, can be expanded at the expense of the production of the most urgently needed and important goods, such as life-saving medicines, with no effect on the price or profitability of either good. Price controls would prevent the production of the medicines from becoming more profitable as their supply decreased, while a shortage even of pet rocks prevented their production from becoming less profitable as their supply increased.
As Mises showed, to cope with such unintended effects of its price controls, the government must either abolish the price controls or add further measures, namely, precisely the control over what is produced, in what quantity, by what methods, and to whom it is distributed, which I referred to earlier. The combination of price controls with this further set of controls constitutes the de facto socialization of the economic system. For it means that the government then exercises all of the substantive powers of ownership.
For obvious reasons, it behooves the Left to insist that Nazism was capitalist and Christian, rather than socialism blended with Applied Darwinsm. Posted by Orrin Judd at November 11, 2005 12:23 PM
Gee, you mean the Nazis weren't kidding about both the nationalism and the socialism?
Go figure!
Posted by: Ed Driscoll at November 11, 2005 1:26 PMYou know nobody uses the phrase "Applied Darwinsm" besides you. So it's not really something most people, left or right, would think about.
Posted by: Brandon at November 11, 2005 2:16 PMBrandon. Of course. The point of the site is to make you think about things you wouldn't otherwise. Ignorance isn't actually bliss, just ignorance. But the term comes from Rudolph Hess:
http://www.brothersjudd.com/blog/archives/2003/08/life_unworthy_of_being_lived_1.html
Posted by: oj at November 11, 2005 2:23 PMBrandon-
Can you think of another justification/rationaliaztion for nationalism?
Posted by: Tom C., Stamford,Ct. at November 11, 2005 2:42 PMTom c., are you saying the U.S. isn't nationalistic ? I don't mean to an extreme or malevolent degree, but at all ?
Posted by: Gen. custer at November 11, 2005 2:47 PMWhich is why we're so easily able to integrate immigrants--all they have to do is believe in our creed.
Posted by: oj at November 11, 2005 2:53 PMWhittaker Chambers autobiography details his meeting another ex-communist, who greeted him saying, "Communism is fascism".
Posted by: Jeff at November 11, 2005 3:00 PM"Communism is fascism".
If anything, the reverse of that formula works even better.
Posted by: Ed Driscoll at November 11, 2005 3:15 PMfrom websters:
1. Devotion to the interests or culture of
one's nation.
2. The belief that nations will benefit from
acting independently rather than
collectively, emphasizing national rather
than international goals.
3. Aspirations for national independence in a
country under foreign domination.
the dictionary is your friend, use it. of course i know a certain type of person doesn't feel constrained to abide by the agreed upon meanings of words -- are you two that kind of person ?
Posted by: noam chomsky at November 11, 2005 4:49 PMnoam:
Nationalism defines the nation ethnically:
http://www.brothersjudd.com/blog/archives/2003/05/tofu_is_murder_1.html
Posted by: oj at November 11, 2005 4:55 PMTo Webster:
The dictionary is your friend -- I'll settle for the truth forged by history and personal testimony.
Posted by: Jeff at November 11, 2005 5:12 PM"Nationalism defines the nation ethnically"
only when taken to extremes, such as facism, and even then the argument can be made that at that point nationalism has been supplanted completely
by the over-riding ideology.
a country without nationalism is a country wating to have its population replaced.
Posted by: nicollo machiavelli at November 11, 2005 6:41 PMjust read your url reference which clearly supports
my point about the u.s. being a nationalistic country, albeit of a non-toxic kind.
Tom C: not sure what you are trying to say here, but i do now that it is our leftist brethren who are prone to misusing language.
Posted by: noam chomsky at November 11, 2005 6:46 PMFascism's connection to Communism is pretty direct. Before World War I Mussolini was a socialist, both by upbringing and personal choice. Like many socialists, he expected the workers of the world to unite during World War I and overthrow capitalism. But, it didn't turn out the way they hoped. The Left learned during that war that ethnic identity trumped class loyalty. In response, Mussolini came up with the idea to coopt nationalism in the service of creating a socialist state. Hitler followed suit; he opposed the Communists because of Germany's centuries long antipathy toward the Russians. Fascism / nazism are Marxist heresies.
Posted by: L. Rogers at November 11, 2005 9:30 PMNicollo:
All nationalism is ethnically based, which is why people engage in the dishonest exe4rcise of referring to us as having American nationalism, by which they mean not nationalism.
Posted by: oj at November 11, 2005 10:12 PMI can't do better than I did here and in the comments following.
Posted by: David Cohen at November 12, 2005 12:16 AMAnd it wasn't very good. Nationalism has a racial component foreign to America. Of course, nationalists being part of the far Right it's obvious why you'd deny their racialism. The Right objects to calling the Nazis quintessentially nationalists and the Left to calling them quintessentially Socialist.
Posted by: oj at November 12, 2005 8:13 AMDavid, you're right, you can't do better than the post you link to. I'm proud to be your sister as well as a sister to all other Americans.
BTW Does your son go to public school? I'm amazed he's studying the Declaration of Independence.
Posted by: erp at November 12, 2005 8:50 AMjust another case of baement boy assigning his own meanings to words. nothing new to see here.
dc: i really enjoyed your thoughts on the topic, which have triggered new thoughts of my own (in progress). it is an immature intellect that insists that something is all or nothing, when reality demonstrates it is a continuum. asprin kills when taken in excessive doses, so should we ban it all together ?
just look to europe for a prime example of what happens when nationalism is suppressed completely.
Posted by: sam johnson at November 12, 2005 2:29 PMsam:
You have that backwards. No one is more nationalist than the French, who believe only Gallic blood can make you truly part of the nation. Hitler didn't pick Nazi out of a hat--he meant nationalist and socialist.
Posted by: oj at November 12, 2005 2:35 PMerp: Right back at ya, sister. My kids both go to public schools.
sam: The fight over the EU is, in large measure, a fight about nationalism. The EU is, though, trying to construct a new European nationalism to replace nation-state nationalism.
OJ: Anyone who thinks that American nationalism is a matter of race or blood completely misunderstands American nationalism. On the other hand, anyone who can't see that the United States is special among the nations equally misunderstands American exceptionalism, and thus American nationalism.
I'm always amused when I listen to Howie Carr periodically devote his radio show to rants about illegal immigration. The fifth or sixth caller is invariably an immigrant with a thick accent who joins Howie in bemoaning the illegals who are stealing are precious national resources. Anyone who comes here can become one of us.
Posted by: David Cohen at November 12, 2005 3:06 PMDavid:
Agreed. You call it American nationalism because it has nothing to do with nationalism generally.
Posted by: oj at November 12, 2005 3:22 PMeuropean people are nationalistic, but their governments are not (at the moment). this is like putting the lid on a pot of boiling water, and locking it down -- an artifical pressure is created that eventually explodes.
no one is arguing what hitler meant, and only you are arguing about what "nationalism" means. german and french nationalism will reflect those countries' identity, and american nationalism will reflect our country's identity. their identites are rooted in ethnicity, ours is not.
Posted by: orwells toe at November 12, 2005 3:41 PMyes, they're nationalist. We aren't, as you deftly point out.
Posted by: oj at November 12, 2005 4:10 PMFull points, David.
Posted by: Jeff Guinn at November 12, 2005 9:03 PM