Fascism in Germany. Robin Blick 1975

Chapter III: ‘Blood and Iron’: The Politics of German Heavy Industry

Lenin once said that politics were ‘concentrated economics’. Not that he believed there was a mechanical, automatic or unmediated relationship between economics and politics, or that political structures could not at certain times play an important role in shaping economic events. We only have to recall the economic consequences of the English and French Revolutions, and compare them with the negative example of Germany in 1525, 1815 and 1848, to appreciate that the calibre of a class’ political leadership in a revolutionary situation can have economic repercussions over a much longer period of time. But we should also remember that these variations in the political make-up of the European bourgeoisies were themselves a product of their uneven and combined economic development over the preceding epoch. So, after sifting through all the mediations and processes of reciprocal action and mutual interpenetration, we are obliged to return to one of the most basic of Marxist propositions – the primacy of economics. And it is in the economic structure of the German bourgeoisie that we shall find at least some of the factors which shaped its reactionary political outlook.

First some statistics, for they speak louder and more clearly than can any words about the transformation of the rural, small-town Germany of princedoms and guilds into a nation which in a matter of 40 years rivalled England as the ‘workshop of the world’. In 1815, 73.5 per cent of the Prussian population lived in the countryside. And in Germany’s 12 largest towns dwelt only double the number of people inhabiting Paris. Even as late as 1846, when industrialisation had begun to accelerate in several regions, the percentage of persons officially classified as rural had declined by a mere 1.5 per cent. Meanwhile, in France, and of course above all in Britain, an enormous exodus from the countryside into the towns – many of them relatively new – was in full swing. Germany’s industrial revolution only really began as those of France and England were drawing to a close. Much has been said and written about Germany’s late arrival as an industrial nation, and the economic advantages which accrued to its bourgeoisie as a result of its own tardy maturation. German industry culled from the largely empirical evolution of English technology all that it required to make the Ruhr, greater Berlin, Saxony and Hamburg the most feared rivals of the Black Country, Lancashire, South Wales and Liverpool. How effectively it did so can be gauged from the following indexes of industrial growth:

Pig Iron1.514.8
Iron Ore5.328.7
Steel (1880)1.513.1

Never has there been a comparable industrial upsurge in the entire history of capitalism! English expansion over the same period, formidable though it was, never approached such a giddy tempo:
Production (million tons)18711910
Pig Iron7.810.1

In coal and steel – the economic language not only of heavy industry, but of the machines of war – Germany was, by 1910, the master of Europe. The same process was at work in other fields. Thus in 1861, Germany’s minuscule machine production industry employed only 51 000 workers. Yet by the turn of the century, this branch of the labour force had multiplied twentyfold. Here too, planning and plagiarism played their part, with Bismarck’s emphasis on industrial espionage and technical training in the education of the young. Neither were transport and communications permitted to respond to the expansion of industry in a pragmatic, planless and exaggerated way, as had earlier been the case in England. State investment in and control over Germany’s rail network flowed not only from Prussian conceptions of an economy oriented towards war, but also from the industrial requirements of the bourgeoisie itself. The English railway slump of 1848, bringing in its wake a series of spectacular bankruptcies, underlined the speculative nature of much railway investment. Far better to leave this risky field clear for state intervention and investment, and reap the rewards which a centrally-organised and non-profit-making railway system had to offer for the industrialist and manufacturer. The Junkers proved themselves to be as efficient railway pioneers and managers as they had army officers and state bureaucrats. During a period when the expansion of the English railway system had already begun to slow up, the length of Germany’s network increased from 16 560 kilometres in 1871 to 60 521 in 1912. Likewise with shipping; before her industrial boom, Germany – and here we are speaking principally of Prussia – had been an exporter of cereals and an importer of machinery and other industrial products. After 1871, and with the rapid shift in population balance from the countryside to the towns, from agriculture to industry, Germany became an industrial exporter and importer of foods and raw materials. In 1873, only 38 per cent of German exports were finished goods, while on the eve of the First World War, this percentage had nearly doubled. Germany’s enormously enhanced ties with the world market both as an importer and exporter created a vast demand for merchant shipping, one that could not initially be met by its domestic ship-builders. Soon however, the North Sea yards of Hamburg, Bremen and Kiel were launching some of the world’s fastest, strongest and largest merchant vessels. In 1871, the newly-founded German Empire inherited from its constituent states a puny merchant fleet of 147 ships with a gross tonnage of 82 000. By 1914, German ships ploughed the oceans’ trade routes in a fleet of 2000 vessels weighing 4.4 million tons.

In the 20 years between 1880 and 1900, Germany had in effect overhauled both France and Britain as an exporter nation, and stood second only to that other titanic ‘late arrival’ the United States. Yet all these achievements, truly astounding not only in their quantity and tempo, but also in scope and quality, were accomplished in a period when the German industrial and financial bourgeoisie were almost totally excluded from the summits of political power. The most tempestuous epoch of capitalist development had been paralleled by an equally unprecedented epoch of political emasculation on the part of this very same bourgeoisie! Yet when we look closer at the relationship which evolved between the capitalist class and state power, we see that, in a certain sense, it had little need or incentive to compete with the Junkers for government office. Despite and even against his own subjective feelings, Bismarck, stage by stage, carried out its economic programme. And while he did so, those sections of the bourgeoisie who identified themselves politically with the National Liberals had no compelling motives to break with him because of his high-handed and even contemptuous political methods. They adapted to and even to a certain extent absorbed the feudal residues of Junker rule, while carving out for themselves a position of European economic and technological supremacy. It redounded to the German bourgeoisie’s advantage that its energies and individual talents were concentrated towards that one single goal rather than being simultaneously dispersed in several directions. The philistinism and apparent political backwardness of the German capitalist class under the Empire are only one side of its development, and should be seen as the dialectical complement to its truly monumental industrial fanaticism. This class, politically crushed and apparently demoralised after 1848, nevertheless clung on to several important economic conquests which it made during the revolution. The Frankfurt of 1848 not only witnessed the ludicrous spectacle of the bourgeoisie’s parliamentarians fiddling while Prussia loaded its cannons, but the foundation of Germany’s modern banking system, which in its turn provided much of the funds for the expansion of industry after 1871. Though he would have been loath to admit it, Bismarck had as much need of the House of Rothschild as of the Prussian Officer Corps. Without a modern industry, no cannons and no shells. And without a Rothschild or Gustav von Mevissen, [1] no capital for modern industry. Both in an historical and economic sense, German capitalism began its forwards leap with massive accumulation of money capital, the ‘abstract’ form of capital as opposed to industrial capital in the form of raw materials, machines, etc. In this, it was typically ‘German’. The year of the great reaction, 1849, also saw the formation of Germany’s first joint stock mining company, the ‘Kolner Bergwerksverein’. This revolutionary type of capitalist organisation was soon rapidly extending to other branches of heavy industry, including steel and machine manufacturing. Closely allied to the joint stock company, upon whose foundation would shortly be erected the trust, and to a large extent initiating it, were a series of new industrially oriented banks: the Disconto-Gesellschaft (1851), the Darmstadter (1853), the Berlin Hadelsgesellschaft (1856), the Deutsche Bank (1870), and finally the Dresdner (1872). With the exception of the Dresdner, these banks, the financial giants not only of Bismarck’s Germany but Hitler’s Third Reich, were founded prior to the formation of the Empire in 1871. They provided the indispensable springboard both for the growth of monopoly capitalism in the last decade of the nineteenth century, and subsequently that of German imperialism itself. How false then is the oft-encountered view, which in turn is frequently based on a one-sided and shallow reading of the writings of Marx and Engels on Germany, of a German bourgeoisie devoid of any overall class strategy or political programme. In the later years of imperial Germany, it became evident that reliance on mediating agencies such as the ruling Junker caste was an integral part of its political strategy, and not, as some have claimed, a substitute for it.

In 1862, Bismarck shocked all but the most intransigent members of the Prussian parliament when he made his first speech as the kingdom’s new Chancellor. His brutal words may have outraged liberal conventions and democratic sensibilities, but they became a programme around which the entire industrial bourgeoisie was soon to rally:

Germany looks not to Prussia’s liberalism, but to her force... The great decisions of the day will not be settled by resolutions and majority votes – that was the lesson of 1848 – but by iron and blood.

Iron and blood: if ever the history of a class could be summed up in that brief aphorism, it was that of the German bourgeoisie. How little Bismarck cared for the niceties of parliamentary majority rule can be gleaned from the contrast between the formal balance of party forces in the Reichstag and the composition of his own administration. In the founding Reichstag elections of 1871, the bourgeois parties – National Liberals and Progressives – sent 171 deputies into a 397-seat chamber. Ranged against them were Bismarck’s closest allies, the Conservatives, with only 57 deputies, and the Reichspartei, with 67. The Catholic Centre could also be relied upon to casts its 63 mandates against the Protestant – Prussian bloc, giving the potential bourgeois opposition a theoretical majority in the first Reichstag of at least 110 over the Bismarck bloc. Yet the ‘Iron Chancellor’ reigned supreme, suffering only one serious parliamentary reverse in his 28 years of office. [2] The simple fact was that despite its rapidly accumulating economic wealth and technological prowess, the German bourgeoisie had utterly failed to acquire the most rudimentary forms of statecraft, without which a class cannot successfully hold the reins of power. Thus there could exist an enormous and, for considerable periods of time, unbridgeable gap between a bourgeoisie’s economic vitality and its possibility of translating this into the language of direct state power. Contrast Germany’s development with that of England, where Tudor Bonapartism permitted the leaders of the merchant bourgeoisie, allied with sections of the new aristocracy, to acquire considerable experience in influencing and even shaping governmental policies. This they did not only in repeated clashes with the royal power in Parliament, but through the evolution of a series of religious reform movements and by exercising control over their own economic institutions. The German bourgeoisie enjoyed no such rich tradition of internal self-government, let alone one of courageously challenging the institutions and representatives of absolutism. The economic decline of the sixteenth century, the relapse into semi-barbarism which followed the Thirty Years War, paralleled by the evolution of the ‘Germanic’ form of Protestantism, Lutheranism (which on the bones of the slain anabaptist peasant revolutionaries, and in vivid contrast to its French and English varieties, rapidly revealed a facility for adapting the language of religious revolt to the rigidly dictatorial structures of feudal Germany) all now became negative factors in the bourgeoisie’s struggle for governmental power. The result, as we have already had occasion to stress more than once, was a unique species of state power based on a tacit and ever-fluctuating compromise between two distinct classes; the very nature of which forced them to fuse with one another:

The abolition of feudalism, expressed positively, means the establishment of bourgeois conditions. As the privileges of the nobility fall, legislation becomes more and more bourgeois. And here we come to the crux of the relation of the German bourgeoisie to the government... the government is compelled to introduce these slow and petty reforms. As against the bourgeoisie, however, it portrays each of these small concessions as a sacrifice made to the bourgeoisie, as a concession wrung from the crown with the greatest difficulty, and for which the bourgeoisie ought in return to concede something to the government. And the bourgeoisie, though the true state of affairs is fairly clear to them, allow themselves to be fooled. This is the origin of the tacit agreement which is the mute basis of all Reichstag and Chamber debates in Berlin: on the one hand, the government reforms the laws at a snail’s pace in the interests of the bourgeoisie, removes the feudal obstacles to industry as well as those which arose from the multiplicity of small states, establishes uniform coinage, weights and measures, freedom of occupation, etc, puts Germany’s labour power at the unrestricted disposal of capital by granting freedom of movement, and favours trade and swindling. On the other hand, the bourgeoisie leaves all actual political power in the hands of the government, votes taxes, loans and soldiers, and helps to frame all new reform laws in such a way that the old police power over undesirable characters remains in full force and effect. The bourgeoisie buys its gradual social emancipation at the price of immediate renunciation of its own political power. Naturally the chief motive which makes such an agreement acceptable to the bourgeoisie is not fear of the government but fear of the proletariat. [3]

The wretched conduct of the bourgeoisie in Bismarck’s Reichstag drove many voters away from the National Liberals towards the more democratically inclined (but still not consistently republican) Progressives, generally regarded as the legitimate inheritors of the 1848 tradition. In the 1881 elections, their verbal opposition to Bismarck’s persecution of the Social Democrats swelled the Progressives’ votes to nearly 1.2 million, as compared with little more than 600 000 three years previously. Meanwhile, the National Liberals, who had dutifully toed the Bismarck line, lost heavily, falling from 1.3 million votes and 99 deputies to 746 000 votes and a mere 47 deputies. Undoubtedly, a big segment of Progressive support came from workers who had yet to identify their class interests with the Marxist-influenced Social Democratic Party, but who were determinedly opposed to the fundamentals of Bismarck’s anti-democratic regime. [4] Even though the National Liberals were later able to regain much of the ground lost during this period, they never succeeded in re-establishing their position as the largest parliamentary party. Bismarck’s gamble on manhood suffrage had paid off handsomely. The bourgeoisie, faced by the ever-rising tide of Social Democracy, pulled in its blunted political horns and delegated the arduous and time-consuming task of policing the German working class to the Junker bureaucracy. But in doing so, it never for one moment abdicated the struggle for supremacy in its own domain – the factory, mine or mill. Here, at the physical point of extraction of surplus value from the proletariat, the class war was waged with true Prussian thoroughness and without a trace of the compromise that characterised industry’s relations with Bismarck. The factory politics of the leaders of German heavy industry, as they evolved under Bismarck, provides us with many insights into the crucial alliance forged between Hitler and the coal, steel and chemical kings in the last years of the Weimar Republic. The firm of Krupps [5] by its very nature drew close to the Junker state power, as its main business was the manufacture of weapons of war. Its reactionary pedigree had been established during the 1848 Revolution at a time when the owners of several other similar enterprises were, however briefly and hesitatingly, drawn into the movement for democratic reform. Alfred Krupp summarily dismissed any of his workers whom he suspected of democratic sympathies, instructing his management to keep revolutionary agitators out of his Essen plant by the crude but effective method of shutting the factory gates for the duration of the upheaval. Krupps employees were marched in strict Prussian formation from the workers’ quarters in the town to the factory gates in the morning, and back again at night, for fear that despite their employer’s every precaution, the revolutionary contagion might infect his traditionally loyal workforce. Foremen at the plant were told to ensure their charges were kept busy throughout the day so as, in the words of Alfred Krupp himself, to ‘keep them out of mischief’. Krupp’s loyalty was well rewarded by the Junkers, who never really forgave those bourgeois who flirted with the ‘alien’ ideologies of republicanism and parliamentary democracy. Bismarck himself maintained close personal and political relations with the Krupps, first visiting the Essen works in October 1864, when he discussed with Alfred his future plans for Prussian foreign policy. The Krupp dynasty also evolved its own brand of ‘corporative’ ideology, much of which reappeared in the guise of the National Socialist ‘works community’ of Dr Robert Ley and company. ‘The goal of work shall be the general welfare’ was one of Alfred Krupp’s pet homilies, and he saw to it that it was inculcated into his entire labour force. [6] The year of 1872, one year after the establishment of the German Empire, saw the appearance of Krupp’s General Regulations, being a code of labour, social and political discipline for the Krupp workforce not one wit less dictatorial than any imposed by a German government prior to victory of the Nazis. Bismarck’s anti-socialist laws were mild in comparison. Following a miners’ strike which hit Krupp’s own collieries in July 1872, Alfred Krupp instructed his subordinates that ‘neither now nor at any future time’ should a former striker ‘be taken on at our works, however shorthanded we may be’. Krupp had also been outraged – like all good ‘national’ Germans – by the courageous stand of the two SPD deputies Bebel and Liebknecht in the Prussian parliament against Bismarck’s annexation of Alsace and Lorraine. Then came the Paris Commune, electrifying the most advanced German workers and rousing their class enemies to a white heat of terror and fury. When the first ripples from these titanic events lapped against the Krupp fortress, its sole proprietor struck back savagely: ‘When a strike appears to be imminent in any clique, I shall come there at once’, he warned the Krupp management. ‘... then we shall see about settling the lot. I intend to act quite ruthlessly, for there is, as I see it, no other possible course.’ And then he added, ominously: ‘What does not bend can break.’ [7] Krupp then immediately dispatched to every one of his 16 000 workers the new General Regulations. They are historic for several reasons, not least because they provided both ideas and even slogans which the Nazis later adopted as their own:

The full force of authority must be used to suppress disloyalty and conspiracy. Those who commit unworthy acts must never be permitted to feel safe, must never escape public disgrace. Good, like wickedness, should be examined through a microscope. Even as a seed bears fruit in direct ratio to the nourishment or poison it is given, so it is from the spirit that an act, benign or evil, arises. [8]

Krupp demanded of his workforce (or ‘followers’, as the Nazi labour code was later to describe them) ‘full and undivided energy’, ‘loyalty’, love of ‘good order’ and freedom from what the General Regulations called ‘all prejudicial influences’. [9] Strikes or any other form of resistance by the workers were to be regarded and punished as acts of treason towards the firm. Any worker adjudged guilty of such heinous crimes was ‘never again to become a member of the concern’. The Regulations also took care to exclude from Krupp’s employ all workers suspected of previous union activity or sympathies, for they stipulated that ‘no person known to have taken part in troublemaking of a similar kind elsewhere may be given employment in the firm’. [10]

Such an all-embracing regime, which seeks not only to discipline the worker outwardly in the actual labour process, but also to control and regiment his innermost political thoughts, required a full-time staff of spies and informers. And Krupp set about creating one. Their instructions were to maintain:

... a constant quiet observation of the spirit of our workers, so that we cannot miss the beginning of any ferment anywhere; and I must demand that if the cleverest and best workman or foreman even looks as though he wants to raise objections, or belongs to one of those unions, he shall be dismissed as quickly as practicable, without consideration of whether he can be spared.

Even Krupp’s much-vaunted standards of workmanship were therefore to be sacrificed in the struggle to root out what Alfred once called the ‘devilished seed’ of Social Democracy. But in vain. The huge industrial concentrations of the Ruhr region were a fertile breeding ground for political radicalism and militant trade unionism, and though at first held back by both Bismarck’s anti-socialist laws and the strong grip of ‘social’ Catholicism in this predominately Catholic area, the SPD began to break down the barriers erected against it by Krupp and the other leaders of heavy industry and mining. Despairing of ever cleansing his workers’ minds of ‘prejudicial influences’, Alfred Krupp wrote some 15 years later: ‘I wish somebody with great gifts would start a counter-revolution for the best of the people – with flying columns, labour battalions of young men.’ Little wonder that all the Nazi leaders, from those closest to big business like Funk and Goering, to the self-styled radicals such as Feder and Goebbels, not only carefully eschewed all demagogic attacks on Krupp, but went out of their way to praise the firm’s traditions and style of management. [11] For it had given National Socialism something far more valuable than cash for election campaigns. It had helped provide them with a programme of political, social and economic counter-revolution. It is worth bearing in mind a certain phrase which occurs in the Krupp General Regulations, for it not only became a slogan of German heavy industry, but found its explicit recognition and implementation in the ‘Labour Front’ of Dr Robert Ley. Krupp’s letter to his workers advised them that if they disliked his new regime, they had better leave his employ, ‘the sooner the better’. He was, he stressed, determined ‘to be and remain master in my own house’. [12] Let us now jump over the intervening 61 years to the spring of 1933. The Nazis have on 2 May seized the assets and premises of the entire German trade union movement, and arrested its leaders. Gustav Krupp, the son of Alfred, a fanatical enthusiast of Hitler’s anti-labour policies, has already made haste to introduce Nazi methods into his own plants. And as head of the former ‘German Federation of Industry’ he will shortly take his place as head of the new regime’s Provisional Supreme Economic Council. Robert Ley, butcher of the trade unions, steps forward and declares his party’s economic programme fulfilled. Employers (now, in Nazi parlance, ‘Leaders’) were at last restored to their place as ‘natural leaders’ of the factory. ‘Many employers’, Dr Ley recalled, ‘have for years had to call for the “master in the house.” Now they are once again to be the “master in the house"...’ Alfred Krupp had taken his posthumous revenge on those feared and hated ‘poisoners’ of the Essen workers. The ‘flying columns’ – the SA and the SS – had triumphed where even Alfred Krupp’s plant police and Bismarck’s repressive legislation had failed. After a siege lasting more than half a century, the fortress of German labour was reduced to rubble. For Krupp had been one of the most outspoken and active supporters of Bismarck’s bid to strangle the Marxist movement in its infancy. Parallel with the Berlin government’s nationwide campaign to extirpate the Social Democratic hydra, Alfred Krupp stepped up his own private war against the workers of Essen. Potential employees were obliged to give an oath of personal loyalty to their employer. If they submitted to this unprecedented act of self-abasement, they were, on engagement, subjected to a non-stop barrage of directives and harangues from Alfred Krupp on their alleged slothfulness, greed and other moral deficiencies. On one occasion he informed his workers:

I expect and demand complete trust, refuse to entertain any unjustifiable claims, and will continue to remedy all legitimate grievances, but hereby invite all persons who are not satisfied with these conditions to hand in their notices, rather than wait for me to dismiss them...

And in a fit of pique after losing a local election battle against a pacifist-inclined and SPD-backed Catholic candidate, he ordered that all known or suspected Social Democrats be dismissed from his plants:

The next time I go through the works I want to feel at home and I would rather see the place empty than find some fellow with venom in his heart [sic!], such as every Social Democrat is...

It could be argued that the case of Krupp is not typical of the German bourgeoisie as a whole, and that is of course perfectly correct. [13] But then, since this class, like all bourgeoisies, comprised itself of many economic, political and social groupings, no single firm, family dynasty or individual capitalist could in this sense serve as an example for the entire class. We are not searching for arithmetical averages or means, but for the political core of that class which, under the stress of Germany’s and the world’s most profound economic crisis, turned to Fascism as a means of averting disaster. In this historical sense, the example of Krupps is of enormous significance. Neither is it an isolated one. The Ruhr concerns of the Stumm, Stinnes, Kirdorf and Thyssen families certainly rivalled that of Krupp in their authoritarian attitude towards trade unions and socialism, even if perhaps they did not share its intimacy with Berlin. Together with the big banks, these firms comprised the hub of German heavy industry around which revolved not only the entire economy of Germany but its very existence as a nation. Therefore it is to the political make-up of this numerically insignificant but economically preponderant grouping that we must turn if we wish to establish an historical continuity between the Empire of Bismarck and Wilhelm II and the Third Reich of Hitler. Karl freiherr von Stumm-Halberg, proprietor of a massive Saar-based iron and steel empire, held political and social views which in their form and mode of expression owed more to feudalism than modern industrial capitalism. Yet in content, they were but a projection of this all-consuming drive by the leaders of German heavy industry to be ‘masters in their house’, and had absolutely nothing to do with any yearning for an idyllic and regimented pastoral past. The homilies of Krupp and Stumm were delivered amidst the smokestack forests and slag heap hills of the world’s most concentrated industrial complex. Von Stumm used to summon all his workers to regular meetings, at which he would harangue them on the evils of democracy, trade unionism and socialism. One such speech, delivered in 1889, catches well the flavour of this ‘Junkerised’ industrial serfdom:

... in the Stumm kingdom, as our enemies sarcastically call our community, only one will prevails, and that is the will of his Majesty the King of Prussia... Wherever we look authority is maintained in the case of need by penalties, imposed on those who do not submit to necessary authority... If an industrial enterprise is to flourish it must be organised in a military, not parliamentary fashion... Just as military discipline includes all the members of any army from the field marshal down to the youngest recruit and all take the field against the enemy united when the king calls them, so do the members of the Neunkirch Factory stand together as one man when it is a matter of combating our competitors as well as the dark forces of revolution... Any decline in the authority of employers... appears to me to be the more dangerous since in the long run it will confine itself to those sections of the population which are under discussion here. Once the worker has overthrown the authority of the employer, if he no longer submits to it, if he simply ridicules him when he intends to punish him... then authority in other fields, in state and church, will follow very soon. But if this happens, if authority is destroyed all along the line in all branches of business... then it will not be long before it is undermined even there where it is most necessary, in the army... I should not remain at your head one moment longer if I were to replace my personal relationship with each of you by negotiations with an organisation of workers under outside leadership. Such a relationship with, as it were, a foreign power, would violate my moral sense of duty and my Christian convictions. [14]

Now what is most interesting about this speech is not the highly ‘teutonic’ conceptions of loyalty and discipline, but the amazing degree of bourgeois class consciousness that they overlay. Von Stumm perceived that the crystallisation of any independent working-class organisation and the development of the least political awareness in the proletariat placed in jeopardy not only the stability of his own ‘Kingdom’, but the Empire of his sovereign. The ‘front line’ of the Second Reich ran right through the blast furnaces of Essen and Neunkirch.

Striking too is the resemblance between von Stumm’s notion of the ‘works community’ which he shared with Alfred Krupp, and that of the Nazis. In both cases, the driving force of the capitalist mode of production, the quest for profit through the extraction of surplus value from living human labour-power, is shrouded and in fact concealed from the politically naive by a web of non-economic values, many of them being ideological ‘residues’ from Germany’s feudal and guild past, and overlaid with the militarised conceptions of government evolved by the Junkers. The goal of von Stumm’s production is nothing so vulgar and ‘materialistic’ as personal profit, no more than his ruthless repression of all dissident views reflects any desire for personal power. Each member of the factory community has his allotted place, and a duty to perform it to the best of his – unequal – capacities. Neither did this regimentation cease when the worker left the gates of the Stumm kingdom behind him at night:

An employer who is indifferent to how his worker behaves outside his factory is not living up to his most important duties. I could name a whole series of actions by workers outside the factory which I regard it as an absolute duty of an employer fully conscious of his moral task to prevent... Every master and worker must behave even outside his work in such a manner as to bring honour to the firm of the brothers Stumm; they should be aware their private life is constantly supervised by their superiors.

Here too, Stumm, Krupp and several other leaders of German heavy industry were already indicating, albeit in somewhat archaic language and style, the road later taken by the Nazi ‘Labour Front’ to its goal of the total atomisation of the German working class. For like the Jesuits, Stumm and Ley both desired ‘the whole ‘man’. [15] Stumm naturally indignantly repudiated charges that it was a class regime which ruled in his kingdom:

We all belong to one estate, and that is the honourable estate of blacksmiths... This fiction of the existence of a fourth estate in contrast to property [the three ‘estates’ of pre-revolutionary France had been the aristocracy, the clergy and the bourgeoisie, all based on private property – RB] is also the basis of the insidious attempts to organise the workers against their employers and to place them under the leadership of people who lack any knowledge of their conditions, such as wages, hours, etc...

Stumm shared with Krupp an intransigent hostility to trade unionism, which, as we have already seen, he regarded as the agent of ‘a foreign power,’ much as his King, Wilhelm II, depicted the Social Democrats as ‘vagabonds without a country’, ‘a gang of traitors’ who did not ‘deserve the name of Germans’. This was also, as is well known, a constant theme of Nazi propaganda directed against the leaders of the German labour movement. And we are far from exhausting our inventory of what, for want of a better term, we shall call ‘proto-Nazi’ employers. In fact, in the person of Emil Kirdorf, the Westphalian coal magnate, we have at the same time an industrialist cast in the Stumm – Krupp mould, being a fanatical opponent of trade unionism and socialism, and also one of the key figures in Hitler’s strategy to win the adherence of heavy industry to the Nazi cause. Kirdorf’s long reign as one of the barons of the Rhine-Westphalian coal basin spanned both the era of Bismarck’s anti-socialist laws and the early years of the Nazi Third Reich. His views on trade unions are therefore invested with a double significance. As was the case with Alfred Krupp, nothing enraged him so much as the supreme act of proletarian insubordination – a strike. A wave of stoppages in his coalfields provoked this onslaught from Kirdorf at the 1905 Mannheim conference of the Association for Social Policy:

It is regrettable that our workpeople are able to change their positions at any time. An undertaking can only prosper if it has a stationary band of workers. I do not ask that legislation should come to our help, but that we must reserve to ourselves the right to take measures to check this frequent change of employment. The proposal has been made that all workpeople should be compelled to join organisations and that employers should be required to negotiate with these organisations. For myself, I would remark that I refuse to negotiate with any organisation whatever.

Kirdorf even refused to treat with the Catholic unions, which were set up in direct opposition to those under the leadership of the SPD:

While the Social Democratic organisations at least say openly at what they are aiming – viz, the subversion of the present social order – the Christian unions fight under a false flag. They know well that the subversion desired by the Social Democrats cannot be brought about, so they seek to place capitalism under the domination of the clergy.

And for good measure, Kirdorf also criticised the Berlin government for its half-baked attempts to introduce a programme of social reforms and factory legislation: ‘I regret, too, that the state interferes at all in labour relationships.’ It was, of course, a different matter when some 28 years later the state, under the leadership of his Nazi allies, intervened on the side of the employer against the trade unions! Barbarism in fact lay very close to the surface of German heavy industry. At a time when large sections of British capitalism were being compelled to retreat from their previous position of intransigent opposition to factory legislation, the steel and coal kings of Germany were not merely standing firm, but taking the offensive. The Rhine iron producers banded together in 1873 in the ‘Centralverband deutscher Industrieller’ precisely to block all attempts at social reform by the Bismarck government. It opposed restrictions on the exploitation of child labour with the altruistic argument that ‘it seems to be more reasonable to set children to work at pleasant jobs and let them make money [sic!] than to allow them to go idle and become wild’. [16] Similarly a ban on night work for women was denounced in the name of ‘liberty of the people to work whenever they want to’. This intransigent attitude was not confined to the Ruhr, though this region undoubtedly contributed more than its fair share of anti-labour warriors. Everywhere that large-scale industry had arisen, there were to be found the spokesmen and practitioners of unremitting class warfare against the proletariat. In 1907, the director of the principal Saxon employers’ organisation declared at its annual conference that:

... the military state of Germany owes the supremacy of its industry in the world market to the discipline asserted in its factories. The authority of the employer is a precious possession, to defend which is our most immediate duty. We shall never yield when it is a question of a test of power on the part of the workman, where the authority of the employer might be menaced.

And then, as if to mitigate, or rather justify, the harshness of this policy, he proceeded to use the same ‘corporatist’ ideology so favoured by Stumm and Krupp, and later plagiarised by Dr Ley:

For this authority is not merely the possession of the individual, it is a common good. Modern economic development has brought to the front the estate of the industrialists, who have superseded the old feudal landed proprietors as employers. Upon the efficiency of the industrialists depend the nation’s power and progress. It is the duty of the industrialists not merely to provide the increasing millions of the population with a livelihood, but it must primarily wage war against subversive endeavours in every form. Our battle against the trade unions is at the same time a battle against Social Democracy. [Emphases added]

The same view was expressed by the most powerful of the pre-Weimar employers organisations, the Central Union of German Industrialists, which in a policy statement on labour-capital relations declared:

The conclusion of wages agreements between employers’ organisations and the organisations of the workers is altogether injurious to German industry and its prosperous development. The agreements not only deprive the individual employers of the liberty of deciding independently as to the employment of their workpeople and the fixing of wages... but they inevitably bring the work people under the domination of the labour organisations. The agreements [17] are, according to the conviction of the Central Union, fully confirmed by the experience of England and the United States, serious obstacles in the way of the progress of German industry in technical matters and in organisation.

How can we explain this organic tendency of German heavy industry towards political and social reaction? Is it a purely German or ‘Prussian’ phenomenon, a product of a prolonged economic liaison with and political dependence on the East Elbian Junkers? Surely not, for the magnates of coal and steel have been traditionally aligned with extreme right-wing political trends not only throughout Europe, but also in the United States and Japan. This general and for imperialism, universal, trend can only arise on the foundations of the nature of heavy industry itself, its irresistible drive towards concentration and monopolisation, its ever-present concern to keep at maximum production the vast fixed capital installations which are unique to heavy industry. The very nature of large-scale iron and steel production, with its continuous processes and delicate chemical combinations, also places a premium on a workforce which is disciplined to the rhythms of the production cycle and which will not be prone to strikes and other interruptions of an ‘external’ nature. With this in mind, we can well appreciate the oft-expressed desire of the leaders of German heavy industry for a workforce which would, willingly or otherwise, subordinate itself entirely to the dictates of the employer. The high organic composition of capital in the ‘heavy’ industries – that is, the ratio between capital expended on means of production and on labour power (wages) – also means that the employer finds the vast bulk of his capital costs do not lend themselves to reduction. Unless he has already secured the advantages of ‘vertical integration’, [18] he will be compelled to pay the market price for all his constant capital. Thus enormous pressure is brought to bear on variable capital, as the only element in a heavy industrialist’s costs which can, given a suitable political and economic climate, be attacked with any prospect of success. The leaders of German heavy industry may not, necessarily, have seen the problem in this clinical light in the period under discussion, but it was undoubtedly one of the most powerful factors driving them to seek a confrontation with the labour movement. To these factors we must, of course, add the well-known but often vulgarly interpreted relationship between heavy industry and militarism. A desire for government arms contracts is obviously an important motive amongst industrialists for supporting movements and regimes which will, because of their imperialist orientation, undertake extensive armaments programmes. But the mistake is sometimes made of deducing from this that imperialist war is little more than the outcome of a conspiracy on the part of the arms manufacturers and those industries allied with them. Rather we should seek the origins of political reaction in the overall relationships engendered by the rise of heavy industry. Small wonder that a German commentator on the Wilhelmian industrial scene noted that:

... the decisive battles of German politics will be fought neither on the Neckar (Baden) nor on the Isar (Bavaria) but in the district of the Elbe (Prussia). For in North Germany capitalism has attained the gigantic expression which is characteristic of the world market; there classes oppose each other so nearly and so roughly that one disputant can look into the white of his enemy’s eye: there amiability long ago disappeared from politics.

Yes, Munich witnessed the birth of the ‘National Socialist German Workers Party’, but to the north, in the heartland of not merely Germany, but all Europe, there smouldered and raged the class forces which were to raise it to the pinnacles of state power.


1. Von Mevissen was the founder of the Cologne A Schaaffhausensche Bankverein. Set up in 1848, it subsequently received Prussian government backing for its policy of promoting industrial development and innovation.

2. This defeat arose over Bismarck’s bid in 1890 to renew and strengthen his notorious anti-socialist legislation, first introduced in 1878. Bismarck staked his continued tenure of office on it, and lost.

3. F Engels, ‘Preface’, The Peasant War in Germany (Moscow, 1956), pp 29-30.

4. The German working class sent but two deputies into the 1871 Reichstag – August Bebel and Wilhelm Liebknecht. Then, with the exception of the first two elections under Bismarck’s anti-socialist legislation, the SPD climbed steadily: 124 000 in 1871, 352 000 in 1874, 493 000 in 1877, 437 000 in 1878, 312 000 in 1881, 550 000 in 1884, 763 000 in 1887, and after 12 years of unrelenting state persecution, an astounding 1.4 million in 1890.

5. The then head of the Krupp dynasty, Gustav von Krupp, von Bohlen und Halbach, is usually quite incorrectly depicted as being strongly opposed to the Nazis right up to the formation of the Hitler government in January 1933. In fact, there is formidable evidence that the Nazi leadership had begun negotiations with the firm of Krupps as early as the summer of 1931. This question will be dealt with in much greater detail at a later stage.

6. In a letter to Kaiser Wilhelm I, Alfred Krupp describes his concern as ‘a national workshop’ whose factories were ‘in a certain degree inseparable from the conception of the growth and importance of the state, and consequently indispensable’. Although Alfred had good cause to stress the ‘national’ character of his undertaking – he was petitioning the Kaiser for state assistance after the collapse of the speculative boom in 1873 – this is, nevertheless, an accurate picture of the intimate relationship which had evolved between the ‘Cannon King’ and the men of ‘blood and iron’.

7. Quoted in W Manchester, The Arms of Krupp (London, 1969), p 178.

8. A Krupp, General Regulations, 9 September 1872.

9. Krupp, General Regulations.

10. Krupp, General Regulations.

11. Thus Feder, in his official commentary on the Nazi Party programme of 1920, writes: ‘The true employer must be a man of moral worth. His task is to discover the real economic needs of the people... He must keep his costs as low as possible in order to get his goods out on to the market, must maintain both the quality and quantity of his output, and must pay his employees well, so that they may be able to purchase goods freely; and he must always be thinking of improvements of his plant and his methods of trading. If he puts these things first in his business, he is “supplying the necessaries of life” in the best, highest sense, and his profits will come of themselves without his making them his first objective. The finest and most universally known example of this kind of manufacturer is Henry Ford. There are other names in our own heavy industries which stand equally high – Krupp, Kirdorf, Abbe, Mannesmann, Siemens and many more.’ (G Feder, Hitler’s Official Programme (English Edition, 1934), pp 84-85.) Ford’s place in the Nazi pantheon had little or nothing to do with his pioneering in methods of assembly line production. Ford was not only the most rabid of American union-busting bosses – he only recognised the UAW in 1940 – but also an avowed anti-Semite, and it was on this basis that the early Nazi movement approached him for funds shortly after the fiasco of the Munich Putsch. Kirdorf, the coal king, was an early supporter and financier of the Nazi Party, while Mannesmann’s backing came at a later stage.

12. Krupp, General Regulations.

13. Unlike many German employers, Alfred Krupp was not a supporter of the National Liberals. He identified himself with the pro-Bismarck Conservatives.

14. The Stumm tradition lived on long after the death of Karl in 1901. His son, F von Stumm, was a vehement supporter of the Third Reich, and a raging anti-Semite to boot. He also undertook reconnaissance missions on behalf of Nazi diplomats while on business trips, as can be seen from the following extract from a letter to the Nazi ambassador in London, Herbert von Dirksen, written after Stumm’s visit to Britain: ‘About Sir NSS. I should like to add that he is thoroughly pro-Franco and thoroughly anti-Semitic. He has a soft spot for us and is at least objective... (Dirksen Papers, Volume 2 (Moscow, 1948), p 202)

15. See the statement by Nazi Front chief Robert Ley, that ‘we begin with the child when he is three years old. As soon as he begins to think he gets a little flag put in his hand; then follows the school, the Hitler Youth, the SA and military training. We don’t let him go; and when adolescence is past, then comes the Labour Front, which takes him again and does not let him go till he dies, whether he likes it or not.’ Elsewhere Ley wrote that a worker escaped the Third Reich only in his sleep: ‘There are no more private citizens. The time is past when anybody could or could not do what he pleased.’ Ley’s organisation even calculated the number of non-working and non-sleeping hours the average worker ‘enjoyed’ in a year, and then attempted to fill them via the ‘Strength Through Joy’ movement. All these techniques originated with the ‘social’ employers of German heavy industry.

16. Contrast this lofty, ‘non-materialistic’ justification for child labour with unashamed claims by English manufacturers that Factory Acts shortening the working day for juveniles would rob them of their profits. Thus ‘Senior’s “Last Hour"’, immortalised by Karl Marx in Volume 1 of Capital (pp 224-30).

17. The agreements referred to are those which were, at the turn of the century, sponsored by the government between employers and trade unions.

18. Germany pioneered this type of industrial organisation, which involved a concern extending ‘vertically’ by absorbing those enterprises which either supplied it with raw materials, or purchased its own product. Kirdorf was a leading advocate of the vertical monopoly: ‘All economic development necessarily leads to integrated undertakings, for a company can only prosper permanently when, besides manufacturing finished goods, it also produces its own raw materials.’