The Downfall of Money: Germany’s Hyperinflation and the Destruction of the Middle Class (36 page)

Germany put itself into a do-or-die situation, where the end justified the means, just as it had during the war, when it had run up huge debts in anticipation of victory. Except . . . this time, what would ‘victory’ against the French in the Ruhr actually mean?

Right or wrong, the government’s unconditional support for the Ruhr was a vastly expensive business, and the only way to pay for it was to print more marks. The presses ran round the clock. Unsurprisingly, by 5 February 1923, the mark stood at 42,250, a quarter of its 15 January level of a little under 12,000 – which in turn had represented a disastrous decline from the levels maintained until Rathenau’s assassination. As fast as it could print them, the government kept sending the ever-increasing quantities of paper marks needed to keep the resistance going.

In an effort to nullify Berlin’s crucial financial support for the Ruhr struggle, the French and Belgian occupation authorities confiscated consignments of paper marks at the newly erected customs posts as best they could, though they never succeeded in seizing more than a small fraction.
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The currency importers showed great ingenuity and bravery. Money was packed into false floors built into vehicles – often driven by women, in the hope that the French would never suspect them – or brought in through the dense woodland that covered the fringe areas of the Ruhr district. It was even imported via labyrinthine mine workings, which in some cases stretched for kilometres beneath the ‘border’, allowing currency couriers to enter from unoccupied Germany disguised as miners and emerge some time later inside the occupation zone.
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The ‘passive resistance’ was a trial of strength. Initially, surprised by the determined reaction of the Germans, and unprepared for the near-total shutdown of the mines and their inability to transport what little coal they could find at the pit heads, the occupiers seemed to have made a mistake. France, whose own currency was now rapidly depreciating, found herself obliged to buy expensive British coking coal to fuel her iron and steel industry, negating the entire reason for the Ruhr invasion. More than a third of French blast furnaces were forced to cease operation during February and March 1922. It seemed as if the predictions that the French would hurt themselves more than the Germans by seizing the Ruhr might turn out to be accurate.

By the beginning of March 1923, 11,000 French and Belgian railway workers had been imported to run the railways in the absence of their German counterparts. Foreign labour was also recruited, including miners from Poland, to dig the coal. Slowly it became clear that, despite the high moral and financial cost, the French were determined to make the occupation work for them.

As conditions worsened in the occupied area, so did relations between the Franco-Belgian forces and the people of the Ruhr. There were clashes between workers and French troops, including one confrontation on 31 March at the Krupp casting works in Essen, where a French army unit had gone to commandeer a large number of motor vehicles. After resistance to the French escalated, thirteen Krupp workers ended up being shot dead and another forty-one injured. Instead of the French soldiers concerned facing an investigation, the company’s management was held responsible by the occupation authorities. Gustav Krupp von Bohlen und Halbach, head of the Krupp concern, was sentenced to fifteen years’ imprisonment and fined 100 million marks. Several other senior Krupp executives were sentenced to prison terms.
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In May there was a major strike and a near-uprising by workers in the city of Dortmund, on the eastern edge of the Ruhr, in which a further twenty workers were shot by French troops.
22

There was also a small but significant amount of armed resistance against the French. Ignoring the Berlin government’s pleas to keep the opposition peaceful, during March and April an experienced group of former Freikorps members known as ‘Organisation Heinz’, led by a fanatical ultra-nationalist named Hauenstein, carried out acts of violent sabotage in the Ruhr. These included the dynamiting of railway tracks to stop coal being shipped to France and Belgium. The saboteurs used explosives charges made out of lumps of coal hollowed out, packed with dynamite and furnished with fuses. In this they were almost certainly acting with the agreement of the Defence Ministry – money and instructions came from Colonel von Stülpnagel of the General Staff in Berlin and were channelled through the Sixth District Military Command in Münster, just outside the occupied area – and also enjoyed connections with senior executives at Krupp and the Essen Chamber of Commerce.
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Nor were they satisfied with acts of sabotage alone. The group also kept watch outside the French headquarters in Essen, the former offices of the Coal Syndicate (now exiled in Hamburg), and made notes on Germans who went in and out. Eight of such subjects were adjudged traitors and ‘executed’.
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During the night of 7-8 April 1923, a young man by the name of Albert Leo Schlageter was arrested by the French at his hotel. Twenty-eight years old, a Catholic farmer’s son from the Black Forest, he had served with distinction in the army during the war and later as a lieutenant with the Freikorps in the post-war campaigns in the Baltic and in Upper Silesia. There he had also served as a member of ‘Organisation Heinz’ under Hauenstein, helping to carry out anti-Polish acts which quite possibly also included the murders of so-called ‘collaborators’. Convicted of espionage and sabotage, crimes of which he was undoubtedly guilty but which to most patriotic Germans were both understandable and praiseworthy, Schlageter was sentenced to death a month after his arrest and executed on a stretch of heathland outside Düsseldorf by a French firing squad on 26 May.

The newly created hero was praised by a wide spectrum of German opinion, from Communists (Comintern member Karl Radek tried to claim him as a brave but politically misguided anti-capitalist) to, more understandably, conservative nationalists. Schlageter was also, like his commander, Hauenstein, a member of an organisation by the name of the National Socialist German Workers’ Party (NSDAP). In him the NSDAP had its first martyr, and in the twin curses of Ruhr occupation and hyperinflation its first great opportunity.

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Führer

The young rabble-rouser who had flown up to Berlin from Munich at the time of the Kapp putsch in March 1920 was now, three years later, a powerful figure in Bavaria with political tentacles reaching out into other parts of Germany. His rise had been astonishing. The NSDAP (or, as it was known for short, affectionately or otherwise, the Nazi Party) had expanded rapidly since Adolf Hitler took charge.

In January 1919, the Spartacists had attempted a coup on the Bolshevik model
in
Berlin. A hundred insurgents died in fighting for the capital. Disturbances followed
t
hroughou
t
Germany, culminating in the short-lived ‘Soviet Republic’ of Bavaria. A group of idealists and adventurers ruled chaotically
and
violently in Munich for some weeks before their regime was suppressed in May 1919 by a mix of army troops, Freikorps and armed local volunteers known as the
Einwohnerwehr
(a citizens’ militia, literally translatable as ‘inhabitants’ defence’).

The ‘white terror’ that ensued was, if anything, worse than the red. The battle for Munich is thought to have cost more than 600 lives, only 38 of them on the counter-revolutionary side and 335 of them civilians.
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With ruthless, unapologetic reactionaries in power in Munich, Bavaria, which had always possessed a keen sense of its own identity even within the unified Reich, now began to drift away from democratic Berlin. During the following years, this would give Bavaria a ‘semi-detached’ status.

Among those soldiers who had remained with the colours after the war was an infantry corporal of decidedly anti-democratic and anti-Semitic views. He had heard of the
November
armistice in a military hospital on the Baltic coast while immobilised by the effects of a mustard ga
s
attack on the Western Front. Little except his extreme opinions seemed, at that point, to distinguish Adolf Hitler from the great mass
of defeated
soldiery. However, unlike millions of others he had no home or
family
awaiting him when he recovered. Although he had chosen to serve with the German army, he was an Austrian citizen, son of a customs official. Both his parents were now dead, and Austria was, moreover, in any case in an even worse condition than Germany. Neither did he have a career to return to, having eked out a semi-vagrant existence before answering the call to the colours in August 1914. He had only fifteen already somewhat devalued marks in
t
he
bank. So, in mid-November 1918, Hitler travelled back to Munich, where he had lived
before
enlisting, to rejoin his army
uni
t
.

Hitler does not seem to have played a role in physically restoring ‘order’ during the spring of 1919.
A
great talker, evolving into a nationalist firebrand, he was earmarked for a different role.
Hi
t
ler
attended an army-sponsored political education course, ‘graduating’ at the end of August
.

After the imposition of a conservative-nationalist B
avarian
government, the Munich Reichswehr command undertook an operation to shore up grass-roots support for the
new
regime. Corporal Hitler was ordered to check out promising local organisations. This
assignmen
t
brought him, on the evening of 12 September 1919, to a meeting of the tiny right-wing,
an
t
i-Semi
t
ic
National Workers’ Party (DAP) in a function room at the Sterneckerbräu
brewer in the street named Tal, in central Munich.

Hitler remained quiet until an academic gentleman made some remarks that displeased him.
This
unleashed a crushing torrent of oratory from the newcomer, forcing the Herr Professor to
wi
t
hdraw,
defeated. The DAP’s founder and leader, a self-educated tool maker named Anton Drexler, remarked
adm
i
r
i
ng
l
y
,
after hearing Hitler’s tirade: ‘God, that one’s got a mouth on him. We could use
h
i
m.’

Hitler became an active member of the party. Drexler, by all accounts a shy and indecisive man,
was
quickly overshadowed by him. Demobilised in spring 1920, Hitler became the party’s propaganda chief. His rabble-rousing eloquence was clearly responsible for the rapid improvement in the
par
t
y’s for
t
unes.
A year later, he became Führer of the NSDAP (the words ‘National Socialist’ had by
now
been added), armed at his insistence with dictatorial powers that would endure to his and the party’s end.

Hitler’s challenge to what he referred to as the ‘Jew-Republic’ was totally uncompromising. Unlike other nationalist parties, the Nazis preached non-involvement in the democratic process and made open preparations for a coup that would install a dictatorship in Bavaria and throughout Germany. This quickly led to the party being made illegal in Prussia, which contained two-thirds of the Reich’s population, and in several other of the larger northern states.

The far right (and far left) continued to prosper as reparations started to bite, social and
economic
unrest grew and the currency’s value began its dizzying slide. When Hitler joined, the membership of the DAP amounted to less than a hundred. By the end of 1921 that of the relaunched NSDAP had reached 6,000. Despite being officially banned throughout most of the country, during 1922 the par
t
y
passed the five-figure mark until, in January 1923, its membership exceeded 20,000 and it was able to stage its first national party congress.

Even Germans living abroad had taken a fancy to young Hitler. It was 1,000 precious
do
ll
ar
s,
donated by a German-American in February 1923 – with the mark at around 28,000 to the dollar –
that allowed Hitler to turn the party organ, the
Völkischer Beobachter
(literally, ‘Folkish
Ob
s
erver’)
from a twice-weekly into a daily
paper.

Schlageter was one of the ‘underground Nazis’ in the north when he was arrested and executed by the French.
2
His allegiances were, it was true, a little more complicated than that. This passionate young nationalist has been said to have joined a number of right-wing organisations, and before his arrest to have strongly criticised Hitler for lack of enthusiasm in support of the struggle against the French in the Ruhr.
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Hitler’s reaction to the Ruhr occupation had indeed differed radically from that of most German nationalist leaders. Addressing a large rally at the Zirkus Krone in Munich on 11 January 1923, the day of the invasion, he refused to join in the united chorus of opposition, the so-called new
Burgfrieden
, claiming instead that it was the ‘Jews’ and the ‘November criminals’ (i.e. the leaders of the 9 November revolution) who were really to blame. It was they, he proclaimed, who had brought Germany so low that the old enemy, France, could humiliate her in this way. Hitler even ordered that Nazi Party members taking part in resistance activities in the Ruhr should be expelled from the organisation.
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