The Social Economy

“Earn it if you would own it!” National Socialist economic theoretician Dr. Otto Wagener and the ‘third way’ between nationalization and socialization

A common misconception I see about National Socialism is that the movement “had no theory,” that it comprised at best a set of mindless slogans and aesthetics which had no solid intellectual footing. The swaggering remarks made by some NSDAP leaders admittedly have not helped allay this perception, as they were often overly keen to define their movement as one of “action” in order to set it apart from the staid, dogma-laden, bourgeois respectability of more mainstream competitors. Yet the claim that National Socialism was bereft of ideas or principles cannot have been particularly convincing to anyone alive when it was at its most active, at least to those with eyes. The movement in its heyday produced massive quantities of publications examining political, economic, scientific, and philosophical issues from the perspective of the “nationalsozialistische Weltanschauung,” including a number of theoretical journals. Particularly central to National Socialist ideology was its economic theory, which had deep roots by way of Social-Democracy and the Kathedersozialisten, and which the Party’s Economic Policy Department (Wirtschaftspolitische Abteilung, WPA) worked into a variety of draft policy proposals in the early 1930s. The head of the WPA was Dr. Otto Wagener (b.1888 – d.1971), a man who for several years was a senior figure in the NS leadership as well as the NSDAP’s chief economic theoretician. One of the potential models for a National Socialist economic order explored by Wagener was that of the “social economy” (Sozialwirtschaft), a system in which the principles of natural selection and worker participation would merge to form a new alternative to both nationalization and socialization. Property rights in Wagener’s “social economy” would not be absolute, with the system instead being characterized by a gradual and continuous transfer of business and industry ownership into the hands of the most capable workers. Wagener’s idea, like many of the draft proposals researched and debated by the WPA, never actually became official policy, but it nonetheless still serves as a perfect example of the theoretical credentials of a movement so often painted as crudely anti-intellectual. The text below is an excerpted chapter from Wagener’s post-War memoirs, in which the author gives an account of the informal economic policy conferences he held with Hitler in 1930 where the idea of the “social economy” was first discussed. The majority of the text is taken verbatim from Ruth Hein’s English translation of Wagener’s memoirs, although I have edited it slightly to add in several sections from the German original which Hein cut from her translation. 

Plans for a “Social Economy”
An Informal Economic Policy Conference, Summer, 1930
From the memoirs of Dr. Otto Wagener


In the early summer of 1930, Hess asked me on behalf of Hitler whether I had time at a certain hour the next day for an economic policy conference. Strasser and Dr. Wagner,1 at that time Gauleiter of Munich, would be present.

The next day the four of us sat around the round table in Hitler’s office.

Hitler raised the issue of my position on the problem of nationalization and socialization. I had the feeling that he wanted to familiarize himself for the first time with my attitude towards economic policy.

I began by stating something like the following:

“Of course, I am naturally well-acquainted with what the points of the NSDAP programme say regarding this topic. But since you are asking how I feel about these problems, I shall now neither take these into account nor refer to them.”

In wide-ranging remarks on the problem between “capital and labor” in industry, Wagener in the following pages of his memoir then rejects as a solution both nationalization and a “direct socialization” through the takeover of enterprises by workers.2 A “direct socialization” is impractical in the long term, especially with regard to future investment. Nationalization merely replaces the private entrepreneur with the state, while leaving the worker in a service relationship with capital. This entangles the state in the conflict between capital and labor, a development which could have dangerous political consequences. Nationalization also leaves unanswered the question: Who is the state? Its final result would be domination by those groups which control the state, the consequence being the spread of the “spirit of the feeding-trough.” In addition, the “automatic self-healing mechanisms” inherent within “healthy competitive struggle” would also be lost. Wagener therefore warned against the nationalization of those enterprises which the state did not absolutely need to possess. “Completely different methods” would be necessary in order to achieve the transition from individualism to socialism.

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Gregor Strasser on National Socialism

“We National Socialists are socialists, real, national, German socialists!” A 1925 article by Gregor Strasser on the meaning of Fatherland and National Socialism

NSDAP_Wir_Arbeiter_sind_erwachtThe following article by Gregor Strasser was first published on 4 September, 1925, roughly six months after the NSDAP’s refounding following Hitler’s release from Landsberg Prison. I am not sure in what publication it first appeared. Possibly it was in the Nationalsozialistische Briefe, of which Gregor was chief editor for several years and which was founded at roughly the same time this article was originally printed. Regardless of which platform the article first appeared in, it was considered significant enough to be reprinted in subsequent collections of Gregor’s writings – it shows up both in his 1928 booklet, Freiheit und Brot (‘Freedom and Bread’), and in his ‘collected works’ from 1932, Kampf um Deutschland (‘Struggle for Germany’). It is fairly typical of Gregor’s early writing in that it is heavy on sentiment and emotion but light on actual, concrete policy propositions. This was a deficiency which Gregor was apparently aware of and sought to address later on in his career, as in the early ’30s he began working quite closely with economic experts, business figures, and state officials in an attempt to develop workable programs for resolving the unemployment and housing crises (see his famous ‘Work and Bread!’ speech for one example of this). Despite its propagandist tone the article still makes for an interesting read from a number of angles. It is overtly anti-capitalist, espouses a commitment to radical economic restructuring and to concepts of social justice (the ‘community of bread’), and additionally includes a brief recollection from the author’s time as a junior officer in WWI. Like many in the national-revolutionary camp Gregor makes it clear – both in this piece and many others – that his experiences in the Great War are what led him to an awareness of the plight of the German worker, and are what turned him from an ordinary German nationalist into a National Socialist, the belief system of which he attempts to convey within this article.

National Socialism:
“What does ‘Fatherland’ mean?”
Gregor Strasser


With the Dawes Plan, the intention of Jewish-influenced, American-English capital to use Germany’s national economy as a gigantic profit-extraction operation, to transform German industry into a colossal workshop for Wall Street capital, and to make an industrious Volk of 60 million people into an enormous army of defenseless wage-slaves, will be fully realized within the next few years.

In light of this development we must now and forever set our goals clearly, unambiguously, and openly.

Only in this way will our ideas gain an attractive power with respect to the yearning of a deceived, betrayed Volk.

We National Socialists are socialists, real, national, German socialists! We reject the vulgarization of this concept, the watering-down of the word from “socialism” into “social” – a word which, like no other, has become a hypocritical smokescreen behind which the all-too-visible inadequacy of the capitalist economic system is concealed, or which is, at best, the totally inadequate consolation for the kinds of honest men who believe that they can cure the festering wounds on the body of the economy and the Volk by placing a compassionate sticking-plaster over them. No, we are socialists, and we do not shy away from taking upon ourselves the stigma of this word, a word which Marxism has so terribly distorted. Continue reading

Paetel on the NSDAP and Red Revolution

Red Front, Brown Front: Karl Otto Paetel’s 1930 article on revolutionary political fronts and the NSDAP’s approach to a potential communist uprising

Three_AmigosThe essay “Clear Fronts!” was written by social-nationalist intellectual Karl Otto Paetel in that brief 1929-30 period when he was organizer of  the ‘Young Front Working Circle’, an informal pressure group whose guiding ideal was the promotion of stronger ties and closer cooperation between radical groups on the far-left and far-right. The bulk of the Young Front’s propaganda efforts were focused on the NSDAP, a party which Paetel and his associates viewed at the time as the most promising vehicle for the achievement of a revolution that would be both socialist and nationalist. While Paetel was never a member of the NSDAP, he nonetheless fostered close ties with it in this period – many of his friends were members of the Party’s radical Berlin-Brandenburg branch, and both the Young Front and its successor organization (the ‘Group of Social-Revolutionary Nationalists’, founded in May 1930) drew much of their membership from disaffected members of the NSDAP’s Strasser faction. Paetel’s relationship with the National Socialists was strong enough that he was a frequent contributor to Party publications despite his lack of membership, primarily to those published by the Strasser-owned Kampfverlag publishing house. The article reproduced below is a good example of this, as its original publication was in the Nationalsozialistiche Briefe, a Kampfverlag theoretical journal. While not technically an official Party publication (the Kampfverlag and its output were kept formally independent in order to distance their association with Hitler) the NS-Briefe was, alongside the official Nationalsozialistische Monatshefte, the primary intellectual publication of the German National Socialist movement, and was fairly widely read by nationalist radicals. Paetel’s article calls on these readers not to “misrepresent” the Red ‘front’ and to recognize that the System, rather than the Communist Party of Germany (KPD), is the real enemy of the German Revolution. The author’s criticisms of the KPD and his apparent faith in the NSDAP were not to last. By the end of the year, disillusioned by the NSDAP’s ‘bourgeois’ drift and enthused by the KPD’s apparent ‘nationalist’ course, Paetel would switch his allegiance to the KPD and begin advocating a position more in line with that later expressed in his National Bolshevist Manifesto. 

Clear Fronts!
By Karl Otto PaetelSymbol

First published in the Nationalsozialistische Briefe, vol. 18, 15 March 1930

Political coalitions or settlements can be the product of rational consideration or tactical measures, but they can also be provided by the political situation itself. Opinions on other political forces only have real value for a movement, one which somehow knows itself to be an exponent of a fundamental spiritual philosophy that is the feature of its time (for only in such movements can one think of being compelled to politics), if they are to a certain degree already in the air and represent the essential concretization of its ideal knowledge.

German Socialism is today faced with two such determinations. Domestically, it is faced with the issue: How should it conduct itself if one day the KPD’s subversive activity, which is ever more clearly being carried out in accordance with Moscow’s directives, attempts to foment “unrest” somewhere as the basis for a proletarian revolution, and the guardians1 of Weimar call out for youth and guns to fight for “peace and order”, to face down “Bolshevism”, and thus to once again pull the chestnuts out of the fire under the black-white-red flags of the Weimar and Versailles dictatorship.

One should be adamantly clear about one thing: If social-revolutionary nationalism and its exponent to the masses, the NSDAP, follows these slogans, then it will have failed in its historical mission of reintegrating the displaced proles into the shared German destiny by ruthlessly implementing a socialist-corporatist system, based on the German nature, via the conflict of the class struggle of labor against international and anti-national capital. A false start in domestic policy in such a situation – an example being compliance under any circumstances with “peace-and-order” slogans – would instead imprint the mark of Cain once and for all upon German Socialists, marking them as the willing or gullible shield-bearers of that finance-capital which dominates the current system even in the judgement of the Democrat Haas,2 and forever blocking that access to the productive proletariat which socialism demands. Continue reading

SA and German Revolution

“A new Germany, reborn in a spiritual revolution of nationalist and socialist intent!” Ernst Röhm’s 1933 article on the SA’s role as vehicle for the ‘German Revolution’

The article by Ernst Röhm below was first published in the June 1933 edition of Nationalsozialistische Monatshefte, a monthly political and cultural journal produced by the NSDAP for the purposes of advancing the theoretical foundations of the National Socialist movement. The article constitutes an interesting, early artifact of the tumultuous early period of 1933-34, when the government was still finding its footing and when the paramilitary SA was still an untethered, unpredictable force advocating for a ‘second revolution’. The months leading up to the article had been frequently punctuated by violence on the SA’s part, engendered partly by disillusionment over the lack of rapid economic reforms (many Stormtroopers were unemployed and hoped to receive official positions in nationalized, state-run enterprises) and suspicion that the revolution had been co-opted by the same bourgeois reactionaries the Party had always so vociferously fought against. It was not uncommon at the time for bored, disgruntled, and frequently drunk SA-men to take out their frustrations on the general public (particularly the bourgeoisie) or on members of the Stahlhelm and other still-legal nationalist paramilitaries. The massive influx of new members into the SA (the organization grew from 400,000 members in 1932 to at least 4million by 1934) also led to problems, with common criminals joining a Sturm to provide political cover for looting, burglary, and other crimes. Röhm tried to reign his men in when their behaviors became too indefensible, but he also sympathized with them, and at times helped fan the flames of dissatisfaction with speeches and articles like that below. Röhm, contemptuous of the Party’s political cadres and even more dismissive of the bourgeois civil service, saw the SA as the basis for Germany’s future government administration. Such a massive transformation would not be achieved if the German Revolution stabilized and petered out, if the Bildungsbürgertum in the political offices and economic institutions were not forcefully dislodged from their positions to make way for revolutionary new blood. Röhm’s radical position, and the fear it caused in the army that he was a destabilizing element and the catalyst for a potential civil war, would ultimately cost him his life. 

SA and German Revolution
Ernst Röhm, SA Chief-of-Staff

First published in Nationalsozialistische Monatshefte, vol. 4, no. 39, June 1933

A victory has been achieved by means of the German Revolution.

The swastika banner flutters upon every bastion of state power, over every place of work, and from every business office of the economy.

The organizational forms of Marxism in Germany have been smashed. The Festival of German Labour,1 that day of mutual confession from the nation to the worker and from the worker to the nation, has sounded the death knell for the insanity of proletarian class-hatred. Adolf Hitler’s iron will has guided the thinking of the Volk with compelling force to the amalgamation of national spirit with socialist will.

A tremendous victory has been achieved. But not absolute victory!

The new state has had no need to disown the bearers of the revolutionary uprising’s will, as the November-men2 had to do with the red gangs who were the fellow-travelers of their revolt born of cowardice and treason. In the New Germany the disciplined brown storm-battalions of the German Revolution stand side by side with the armed forces.

Not as part of them.

The Reichswehr has its own clear task: it is incumbent upon it to defend the the borders of the Reich, insofar as its modest numbers and wholly inadequate armaments enable it to do so.

The police are expected to hold down lawbreakers.

Alongside them there is the new state’s third power-factor with their own specific tasks, the SA and SS.

The Führer and Chancellor of the German Volk needs them, given that the mighty work of German renewal still lies before him.

For the SA and SS are the cornerstone of the coming National Socialist state. Their state, for which they have fought, and which they will claim. The SA and SS are the militant-spiritual bearers of the will of the German Revolution! Continue reading