HITLER THE BANKER

Waikato Independent, Volume XL, Issue 3668, 15 February 1940, Page 2

HITLER THE BANKER

ECONOMIC DICTATOR CONTACT WITH COMMUNISM An article by Dr. T. Plant in- “The Accountant” (London) shows Hitler ih the role of supreme banker of Germany. He remarks that under a new statute the name of the Reichsbank is now Deutsche Reichsbank, which is described in the legislation as a “legal, person subject to State law.” “It would be more correct,” comments Dr. Plant, “to call it a ‘department’ of the Government, for the head of the Deutsche Reichsbank is the Fuehrer himself; he appoints the high officials and his deputy appoints the lower ones; he too decides on the activities and the policy of the bank; he decides too on the amount of credit the bank is to grant the Government of which he himself is the dictator. Treasury bills and other Government securities are admitted as cover for notes without a limit. The provisions for publishing reports have been modified and the obligations made less stringent. Thus commercial bills and Treasury bills will be published together; surely a peculiar procedure for a bank of issue. I need say no more. “The law has its parallel only in the German financial legislation of August, 1914, which opened the doors wide to the most thorough inflation the world has ever witnessed. This leads me back to the problem of inflation in a controlled economy. “In the liberal capitalist economy, inflation is shown by the depreciation of money; and though prices of goods and wages may rise, they are known to lag behind the depreciation of the currency on foreign markets. This under-valuation of the currency on foreign money markets attracts buyers, and international relations quickly restore the equilibrium of the national economy once the budget is balanced. In the controlled economy, however, the price of the currency is pegged; and instead of being undervalued oh foreign money markets it is grossly over-valued by the'reduced quality of goods referred to above. Thus as inflation goes on it makes the return to a normal and balanced economy increasingly more difficult, and it severs at the same time international commercial relations. “All symptoms seem to point to the same fact. The return to a liberal capitalist economy was blocked by the methods of the German controlled economy. The alternative confronting the Ge,rman Government, therefore, seems to have been the transformation of the controlled economy to a Communist .State, or war. They have chosen the latter. For war is a convenient screen for the chaos created by the misconduct of an incompetent dictatorship. But war does not improve financial conditions nor does it show a way out of an economic impasse. Communism, therefore, still seems to be the only outcome that the economist can expect from the Nazi regime which set out to show the world how Communism must be fought.”