Hi Guys,
The German failure to take Moscow in 1941 was utterly unimportant from the perspective of total war. The "contribution" of Germany's allies also falls into this category. Why? I say it again: WWI demonstrated to nearly everyone that industrial war potential and not just the quality of the military forces determined the outcome. Krupp or Ford were therefore more important than Manstein or Patton. Even though Hitler understood this problem to a remarkable degree, Nazi-style procurement policies failed. Why? Hitler's "Führerstaat" disrupted the German dual-use economy across the board. The Nazis forgot that economic potential has to be activated.
Here is a small list of some of the issues:
(1) Nazi/Elite Corruption: Class and party corruption was rampant in Germany. I have pointed out in other posts that tax rates for the industrialists (and party hacks) fell to zero during the war. Remember the ole' argument that the German economics minister, Hjalmar Schacht, resigned prior to the war owing to the balance of payments problem and hyper-inflation. Well, corruption was a big part of the reason. Corruption led to waste, but more importantly demonstrated an incredible lack of interest in the war effort on the part of the elite. They lived it up instead.
(2) Bureaucratic infighting: A long list of interest groups competed for resources and contracts. Companies fought against their rivals. The branches of the military fought against each other. Compounding the problems, Nazi "Gauleiter" and Göring tried to maximize their controls over industry to gain power and wealth. German industrialists quickly learned that bribes kept them independent and in production. The Nazis operated according to a loose and paradoxically democratic system that robbed Germany of centralized planning. The Germans did not have anyone the likes of General Lucius Clay. He was able to channel American productive energy and force the industrialists to concentrate on the weapons systems that the military wanted. After 1942, Albert Speer acted like Clay in many ways and demonstrated the real potential of German industry. Speer, unlike Todt, now actually had a strategic aim -- defending Germany from complete eradication.
These two structural problems hobbled the German military effort. A couple of examples:
(1) The Truly Bizarre: During the late 1930s, IG Farben decided NOT to build more oil synthesis facilities because the existing plant already satiated domestic CIVILIAN requirements. IG Farben worred about profitability. The Nazi leadership (obviously planning for some type of major conflict) let the issue ride instead of forcing IG Farben to act in accordance with their policies. Bizarre is the only appropriate descriptive term. The oil synthesis issue demonstrates how the civilian orientation of German firms helped seal Hitler's fate. The Nazis failed to understand that total war meant the total mobilization of society in pursuit of a military strategy. The Nazis only talked at length about the merits of total war. They did not really understand what total war meant. Nor did they initially have a real strategic aim.
(2) Poor Concentration: The decentralized German allocation system meant that companies competed with each other instead of joining forces and picking the best weapons systems to produce in large volume. When cooperation did happen, such as with the outdated VII U-Boat, production was extensive. As it was, the Nazis normally failed to force industrial compliance and therefore failed to generate production levels equal to the other belligerents. Examples such as Henschel's "Tiger" stand out as a classic wasted effort. All German automotive firms should have joined Daimler, MAN and Rheinmetal-Borsig such as was the case with GM, Ford, etc. in the United States. In any case, as I have pointed out, German firms were still building and exporting automobiles in 1943.
If we want to understand WWII, we have to question the effectiveness of Nazi economic policy. We have to try to understand why Germany, endowed with productive capacities as high as the United States and strengthened by the occupied territories, could not even outproduce Stalin's backward prison state. Historians normally denigrate all aspects of Nazism. Why not in this case? Is it because few people actually want to accept that Hitler's war preparations were so stupid?
Again, I want to sound tough. The Soviet Union and all their junk only looked powerful because of gross failure on the part of Hitler's Germany. The Soviet Union was in fact as weak as Hitler had originally speculated. Why did Stalin then prevail? Hitler and his idiots could not fathom how destructive their own economic policies actually were. Hitler only understood the numbers...not the substance. In a state as morally bankrupt as that of Nazi-Germany, too many people were involved in enhancing their own power. That is arrogance.