Post-War Development of the German Economy Research Paper

Post-War Development of the German Economy - Research Paper Example There was a little hope of a revival because a considerably large percentage of the German population of working age was dead at the end of the war and at that time Germany was looking at the outside world for all kinds of aids for the restoration of its economy. There is no doubt about the fact that German economy was badly hit by the war, but the years of preparation also contributed to the devastated condition of the economy. Adolf Hitler imposed price controls on German population in 1936 in order to start his preparations for the war and acquire commodities and war materials for the army at the cheapest prices; 3 years later, rationings were also imposed on the German population. Conscription was also imposed on the German population in order to gather up a large military which drastically affected the labor sector and the non-military industries could not find labor to keep their plants running. After Nazis defeat and Hitler’s death, the Allied Control Authority which wa s formed by the succeeding allied forces under the governments of the United States, Britain, France and the Soviet Union, to run the affairs of government in Germany. The Allied Control Authority retained some of the policies of the Nazi Germany for the restoration of the economy; these policies included rationing, price controls and conscription of all types of resources for ensuring rapid economic recovery (Bidwell). An astonishing fact was the low rise in the cost-of-living index, which was only 31 percent high as compared to the values in 1938. The reason behind this was the fact that price controls had been imposed in Germany for the last 12 years by then. Another important observation in this regard was the fact that the amount of wealth in the German economy was also five to six times higher than the amount in the years before the war. So the main concern about the economy was production levels which had fallen to drastically low values. A wealthy economy in terms of money, price controls intact and low production levels; all these factors pointed towards one major problem _ shortages (Smith). During the war and post war years the Germans were only producing weapons, equipments and materials required for the war; the industrial and agricultural production was very low. During the war years, the main source of food for the Germans was the supplies seized from the occupied countries. Moreover the foreigners were also brought to German lands for farming purposes. This ‘system’ of food production served the German population and the military well during the war years but as soon as the war ended the German rationing system was left with very low supplies of food; incredibly insufficient to fulfill the needs of the German population. The United States Army contributed by dispatching large shipments of food to feed the prisoners of war and the German population, however this was not enough and more aid in terms of food was required for meeting t he food demands but the international community was not willing to provide aid to Germany at the time when there were more deserving and innocent people in the world who were also affected drastically by the war. The other factors which contributed were the dissolving of the German Red Cross, whereas the International Red Cross and other international aid agencies were not allowed to work independently