“Speer is, in a sense, more important for Germany today than Hitler, Himmler, Goering, Goebbels, or the generals. They all have, in a way, become the mere auxiliaries of the man who actually directs the giant power machine-charged with drawing from it the maximum effort under maximum strain… In him is the very epitome of the ‘managerial revolution.’ Speer is not one of the flamboyant and picturesque Nazis. Whether he has any other than conventional political opinions at all is unknown. He might have joined any other political party which gave him a job and a career. He is very much the successful average man, well dressed, civil, non-corrupt, very middle-class in his style of life, with a wife and six children. Much less than any of the other German leaders does he stand for anything particularly German or particularly Nazi. He rather symbolizes a type which is becoming increasingly important in all belligerent countries: the pure technician, the classless bright young man without background, with no other original aim than to make his way in the world and no other means than his technical and managerial ability. It is the lack of psycho-logical and spiritual ballast, and the ease with which he handles the terrifying technical and organizational machinery of our age, which makes this slight type go extremely far nowadays… This is their age; the Hitlers and Himmlers we may get rid of, but the Speers, whatever happens to this particular special man, will long be with us.” – The Guardian, 1943
On February 8th, 1942, Albert Speer assumed office as minister of Armaments and War Production of the German Reich, succeeding Fritz Todt after his untimely death in a plane crash. At the stroke of Hitler’s pen, Speer was among the most powerful men in Germany and occupied Europe, controlling the gears of production for the entire Nazi war machine. Under Speer’s oversight Nazi Germany and its vassals saw an unprecedented tripling of armament output and a doubling of worker efficiency, made more impressive as unit labor or equipment costs remained unchanged under this massive increase, defying the economic laws of diminishing returns.
The Production Miracle
In contrast with America, which had to tighten central controls on its wartime economy, Germany had to loosen them, as years of literal economic fascism and the resulting deference to authority had led to an inability to criticize errors among the corporate management who were beholden to the Nazi regime, leaving the productive apparatus of German society rigid and lacking in initiative.
Speer noticed indifference to the end effects of technicians’ work as they threw themselves into their job without thinking of the consequences on the battlefield and at large. This was a consequence of the sort of half-way-point that Hitler’s fascism represented, in effect, compared with the Soviet system of total central control and the resulting poor incentives, and the Anglo-Saxon model of decentralized market capitalism. To fix this, Speer took bold steps to decentralize the German system, making individual companies responsible for their own production goals – how they hit them was up to management. The end result was armaments contracts were farmed out to largely vertically integrated companies, who’d overseen most of the value added stages of production. In this way Speer abandoned the pre-war Nazi model where the state took a more active role in managing the how of production towards one of targeting what should be produced.
Despite tremendous gains in wheeled vehicle, aircraft and ship production, aggregate ammunition output remained below that of 1918 levels, which Speer attributed to stifling bureaucracy of the Third Reich system: “a few hours before the attempted assassination, I wrote to Hitler that Americans and Russians knew how to act with organizationally simple methods and therefore achieved greater results, whereas we were hampered by superannuated forms of organization and therefore could not match the others’ feat. The war, I said, was also a contest between two systems of organization, the ‘struggle of our system of over-bred organization against the art of improvisation on the opposing side.’ If we did not arrive at a different system of organization, I continued, it would be evident to posterity that our outmoded, tradition-bound, and arthritic organization system had lost the struggle.” Speer took command of the German economy at a time of hastening allied air raids. American and British bombers harassed and at times devastated the factories and labor forces Speer oversaw. At the beginning, allied air campaigns were not especially effective, though aided by a their spies, the Allies’ bombing efforts became more effective, focusing their efforts on key elements in German production and war systems such as ball bearing factories and synthetic oil and rubber facilities. Still, Speer observed the majority of air raids were large area in nature, usually failing to target key installations, which would have significantly hampered production; the major exception to this came when the RAF bombed the Ruhr Valley dams, knocking out water and power for key industries such as coking for metallurgy. Without reasonable hope for renewed Luftwaffe protection, Speer responded by dispersing German industry over a wide land area. This cost Speer the production efficiency that more geographically concentrated industry offered, though Speer and his underlings partially countered this by moving factories underground, into old mines.
Speer’s leadership overhaul also affected the war at sea. After assuming responsibility for naval production and assigning new U-boat construction the highest priority, Speer had sub-assemblies of the submarines built inland like America’s liberty ships and then assembled at dry dock. This cut the production cycle from 11 months to two.
Applying similar logic to Soviet installations, Speer observed that a strike on Russian power stations would deliver an even greater blow to war production, as the Soviet system centralized generating plants into giant installations rather than multiple smaller ones in a grid; a hit to Moscow would knock out electronics and optics, a hit past the Urals would do the same for steel. Unfortunately for the Luftwaffe, they could not summon the support to create long range bombers or reallocate away from Britain, where Hitler insisted despite all protests that he could make Britain withdraw from the war with enough attacks.
American strategic bombing on ball bearing production in Germany and Italy was very damaging, however, as production levels dropped by approximately 1/3 and slowed down virtually the entire vehicle supply chain as their dependence on bearings was exposed; efforts to import ball bearing from Sweden and Switzerland was met with limited success; one successful tactic was substituting ball for slide bearings.
One of the key ideas to grasp about the second world war, and of Albert Speer’s story, was that the German Reich didn’t commit the resources under its command fully to the war effort, with a bare minimum to civilian necessities, until after Stalingrad. This fact, combined with the delays inherent in industrial redirection and in doing so under constant air raids, helps explain the the gulf in war production between the Axis, who controlled nearly all economically meaningful parts of continental Europe by 1942, and the Soviet and Anglo allies.
Focusing simply on the number of tanks produced, be they light, medium or heavy, the Germans had a considerably quality advantage, but fell devastatingly short in terms of quantity. The Reich produced 67,000 tanks and self-propelled guns over the war. This includes about 1,300 of the outstanding Tigers, 6,000 of the best-of-the-war Panthers and about 8,500 highly able Panzer IVs for a total of 15,800 quality state of the art and bleeding edge tanks. This figure compares ill against the Soviet production number of 84,000 T-34s, which while primitive in some regards, were revolutionary in their application of a large main gun, sloped armor, high speed in a relatively compact and moderate-weight package that was ideal for the flat terrain of the north European plain. In total the USSR ended up producing 106,000 tanks of all types, and while much of this occurred toward the end of the war when Germany’s fate was sealed, it shows just how lopsided the fight was, especially considering that so many of these were of the T-34 model, which outclassed all but the German Tigers and Panthers, produced in only small numbers. The British came fairly close to German production levels, if only in terms of quantity, making 48,000 tanks, while the US cranked out a staggering 102,000 tanks, even if most of these were relatively puny Sherman models and entered the war only on narrow fronts until the war was all but over.
A common trope in post war, Hollywood-influenced media was the notion that the Germans could have produced a bomb, often combined with the idea that Albert Einstein was instrumental in bringing this potentiality to Roosevelt’s mind. However, Speer makes a point in Inside the Third Reich of saying that this was well outside the realm of possibilities. With the start of Barbarossa, Germany was simply stretched beyond its limits industrially and manpower-wise. With Speer struggling to squeeze efficiency out of German cartridge, rifle and tank production, there was simply not enough left over resources to commit Germany to the extensive cyclotron production that would have been needed to make a nuclear weapon.
Ministers noticed Hitler had a penchant for promoting intelligent deputies, which perversely led his direct subordinates to avoid promoting underlings smarter than themselves out of fear of being replaced. Göring’s morphine habits began to surface, and during a meeting with German steel industrialists, after lecturing them about being productive and generally patronizing them, he fell asleep at the conference table. This so embarrassed Hitler that he held a later meeting with the industrialists to restore the government’s prestige. Göring, who was an old veteran from the street fighting days of the NSDAP, lacked the talent for national leadership, and resented being shut out of policy discussions after the war had progressed to a dire stage. Transportation became a crucial issue during the war, with freight trains breaking down in the tough Russian winters and locomotive repair and replacements becoming difficult; Göring had the bizarre proposal of using concrete to make locomotives instead of steel, an episode which Speer lamented wasting valuable time hearing out.
Himmler generally didn’t trust Speer because he would argue with Hitler on topics such as the Me-262 jet airplane, or the use of scorched earth during their retreat through Germany. One of the more egregious examples of disagreement came when Hitler insisted on allocated resources towards new tank production away from spare parts, which his generals, including Heinz Guderian, insisted would prove a more effective way to keep the most tanks in action at less cost.
Speer was close to the seat of power when the Stalingrad tragedy unfolded. Hitler insisted the Sixth Army hold the ruined city to disrupt Ukrainian grain shipments, while his generals quietly disagreed. To Speer, Hitler had built a regime of yes-men, a fragile command structure that required an unreasonable levels of correct decision making and energy on the part of the Fuhrer. When Göring’s promises to keep the encircled Sixth Army in Stalingrad supplied by the Luftwaffe failed, and Hitler refusing a strategic retreat, the resulting 300,000 troops that were lost to either death or capture sealed Germany’s fate to many in the eyes of the highest ranks of the Third Reich.
With defeats in Tunisia, Stalingrad and an increasingly damaging allied bombing campaign, Hitler shed his causal management approach, though not for the better. The German leader became rigid and obsessive in his work habits, allowing little dissent and assuming ultimate responsibility for nearly everything, doubling down on the leadership flaws which led to Stalingrad. An increasingly exhausted Hitler began making more obviously poor decisions on matters which should have been delegated to his generals. When the Allies offered unconditional surrender, some in the high command suggested the Germans consider their options, but Hitler declared “we’ve burned all our bridges- there is no going back now.” One wonders ex post, how much suffering and death might have been avoided, and how much more territory the Reich might have retained, had it surrendered early to the Allied powers.
Speer tried to move war production out of Germany to lessen the incentive for the Allies to bomb his country. Moving production into France, the most obvious candidate to assume a large chunk of German output, however, proved difficult. French factory workers fled their jobs when the Germans attempted to redirect their efforts towards the war. To address this, Speer agreed that French industry would focus on civilian goods, supplying both France and other countries within the Third Reich.
Speer also shifted his message to the industrialists who supplied armaments. Before Stalingrad, his message had been one of carrots – the state would reward the arms producers for their efforts with continued contracts in peace time and guarantees that their businesses would not be nationalized. However, after defeat began to look more and more likely, the message became one of sticks – the industrialists were sure to be ruined should German lose the war.
As the Red Army advanced closer to the borders of the Reich in 1944, Speer began doing what he could to prepare German for life after the war. Speer used his authority to hinder Hitler’s efforts at implementing a scorched earth policy. This saved vast amounts of infrastructure and factory equipment in what would become west German from destruction. In this way, Speer should be given some credit for enabling the Wirtschaftswunder economic revival of the German Bundesrepublik in the 1950s.
At his trial in Nuremberg, Speer did not deny any responsibility in carrying out Hitler’s orders, and admitted to knowing of forced labor. Despite warnings from his lawyer to not accept full responsibility, Speer wrote to his wife that he felt he owed it to the German people to tell them the truth, and he had nothing really to gain from doing otherwise. Nine months of the prosecution presenting war crimes had its effect on the defendants, with even Göring in his final speech showing shock at the revelations presented about brutal acts of violence. In the age of technology, as Speer saw it, Hitler had demonstrated how brutally efficient a dictatorship could be in bypassing the organic hierarchy which had evolved in European societies. Hitler could effectively bypass the aristocracy, bourgeoisie and clergy, and speak directly to the people through mass communication. Speer anticipated the need for the growing need for individual thought in such an age, where people would be further presented with a monoculture of mass programming. In the final analysis, Speer could not deny that he helped further a regime that held world dominion in its goals, and placed Speer’s capital dome in Berlin at its center. Hitler remarked many times that he wished to reduce France to a minor state, and turn Russia in a peasant country. Hitler’s intended rename of a reconstructed Berlin to Welthauptstadt Germania (lit. world-head-stead/World-Captital Germania) leaves little doubt he was sincere in his convictions.
CORRECTION: Göring proposed using concrete for locomotives, not airplanes, as indicated in the podcast