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In his lifetime, my grandfather, Frank Munk, published three books and numerous articles on the intersection of economics and political science. The Legacy of Nazism, published in 1943, was the second of those books. It was written just four years after the Munk family left Europe and arrived in the United States. In addition to the preface, I have published four chapters from this book in order to capture the gist of his ideas as they relate to my grandfather's experience of the times.

bullet Chapter 1 - The Impact of Totalitarian Economy
bulletChapter 3 - Removal and Destruction of Populations (below)
bulletChapter 7 - Banking and Germanization
bullet Chapter 11 - Psychology of the Subjugated

These books are all out of print today so, for reference, I have transcribed a few chapters from each book that have elements relevant to our family history. The other two books were:

bullet The Economics Of Force(1941)
bullet Atlantic Dilemma (1964)


The Legacy of Nazism




German population policy under Nazism is, of course, a logical consequence of the idea of “space-politics” and can only be understood in reference to it. All nations, according to this theory, tend to be “space-bound” (raumgebunden). They can be destroyed by severing their connection with space. Forced (or voluntary) migration thus becomes a method of warfare aiming at permanent dissolution of the enemy nation — or, at least, its complete impotency. Germany on the contrary is a “space-vanquishing” (raumbezwingend) nation. Earth is represented not only as living space, but more particularly as “space for development of power.“ Its eternal mission entitles and compels Germany to conquer space, sometimes with the inclusion, sometimes with the exclusion of the peoples settled thereon, depending on what plans the Nazis may have for still further expansion. Germany has the right to dispose of nations as she deems desirable. She has an inherent and supreme right to space and can fix the conditions of its occupation. According to the more radical followers of “geopolitics” all other nations have only squatters' rights, whereas the Germans hold the true title. The other nations may be moved and removed at will. No wonder the greatest migration since the days of Rome's downfall is in progress — a planned, relentless, merciless, forced uprooting of countless human beings.

Wholesale destruction of racial or national groups must leave its mark upon the world. The economic and social repercussions will be more far-reaching than is at present realized. No one knows to what length it will be carried and who will be its victims. “The millions among the persecuted minority groups who are left at the mercy of ruthless tyrannies are in process of extermination. They are deported to bleak and unprepared areas in pursuance of grandiose schemes of population redistribution; they are subjected to discrimination in the distribution of food, confiscation of capital, to exclusion from employment; the sexes are often separated; there are wholesale mass executions. By all methods, a systematic campaign of extinction is being waged against them with a cold-blooded and premeditated cruelty that many people in more fortunate countries cannot conceive and, therefore, too often dismiss as exaggerated anti-totalitarian propaganda. The evidence, unfortunately, is undeniable; indeed, those in charge of totalitarian policy do not deny but justify and defend their actions.”

Eastern Europe in particular has become the Nazis' laboratory, and the population plays the unfortunate role of guinea pigs to Hitler. There is a curious inconsistency in the attitude of National Socialists towards the East. The very term “East” carries with it, in the Nazis' language, a slight connotation of disdain. Yet the East seems to exercise upon the Germans a mysterious power of attraction. Haushofer and his school of geopolitics always have admitted their indebtedness to the teachings of the great English geographer, Sir Halford J. Mackinder. From him they took many of their clues, especially his famous assertion, “Who rules East Europe commands the Heartland: Who rules the Heartland commands the World-Island [i.e., Europe and Asia]: Who rules the World-Island commands the World.” In a subconscious way, they fear the East. They wish to conquer it, yet they are afraid to be conquered by it.

Dr. Frank, head of the Government General (the central part) of Poland, called his domain “an integral part of the Great German power space.” The Fuhrer's decree establishing the Government General in its present form declares it to be a Nebenland of the Reich. This would best be translated as secondary or subordinate country, a new category in international law. The ultimate aim of German policy is to divorce the peoples and races now living in Middle-Eastern Europe from that space. Two methods are open: transplantation, and extinction. In the case of the Jews, the latter method now seems to have been determined upon. The Government General, which was at first thought of as a dumping ground and later as a transition camp before ultimate deportation farther east, became a slaughterhouse. Masses of human beings are being divorced from space as well as from life. Deportation of Czechs from their homeland, and their settlement in the “eastern spaces” has recently been indicated by the Czech Quisling, Moravec, in a press interview. Millions of Poles already have been moved eastward. Only desperate need for foreign workers and the pressure of war problems prevented the Germans from carrying their space politics fully into operation.



Why has Germany, which only recently was complaining about her lack of “living space,” suddenly discovered that she needs manpower from abroad? German losses in the war, estimated at four to five million men killed, disabled, and taken prisoner, offer only a partial explanation. The men mobilized for the military and semi-military forces (SS, Gestapo, etc.) are about double that number and constitute a heavy drain on manpower requirements. The truth is that in every boom, wartime or peacetime, Germany discovered she was far from overpopulated. The cause lies in the extreme inelasticity of the labor supply. Germany used to send emigrants overseas. From 1881 to 1895, more than 1,750,000 persons left Germany to settle in other continents. This movement came almost completely to a standstill when German industry attained maturity in 1900, and between 1895 and 1905 the number of emigrants was only 147,000. The number of workers in German industries rose at the same fast rate — which took care of a tremendous population increase swelling the population of the Reich by some 800,000 annually. Apart from a steady influx of rural populations into cities, Germany became a land of immigration, particularly from the East. Hundreds of thousands of Poles came every year as harvest and seasonal workers to take the place of Germans moving into industry. “The treatment accorded to these migratory workers was far from kind. The conditions under which they were housed were so unhuman that protests began to make themselves heard, if only for hygienic and moral reasons. The sight of these badly clothed gangs of foreign-born workers did more than a little… to strengthen the 'Herrenvolk' idea. Even the working class was not entirely immune from this ideological corruption.”

Boom after boom showed that Germany may be “overpopulated” for periods of depression, but that she was “underpopulated” whenever her vast industrial equipment was nearing capacity production. Lack of employment opportunities was confined to the contraction phase of every cycle. Whenever expansion was allowed to proceed unhampered, there appeared both general and specific labor shortages. “Lack of living space” was but a myth as millions of foreign workers compelled to forced labor bear witness.

An impartial student of German economic development comes to the conclusion that prior to 1914, “despite the tremendous increase in populations there were no visible symptoms of pressure against natural resources. On the contrary, Germany was changing from a country of emigration to one of immigration.” Nevertheless, Germany (and Austria-Hungary) started the First World War, and twenty years after their defeat, Germany loosed again upon the world a catastrophe of immense magnitude.

The use of drafted alien labor in Germany, while an important part of Nazi economy and one that inflicts a great deal of suffering both on the workers and on their families because of enforced separation, will probably not present any insurmountable difficulty of repatriation after the war since laborers will be needed in their homelands for immediate postwar public works. Their number was estimated at 2,000,000 at the beginning of 1941. Herman Goring, in his speech on October 4, 1942, stated that Germany “must care” for more than 6,000,000 foreign workers and over 5,000,000 war prisoners. The latter figures may be somewhat exaggerated. No doubt several million war prisoners also have been pressed into work. Nearly half of the foreign workers are employed in industry, the rest are employed in mining and agriculture. Fully to understand the importance of alien labor to the German war effort, it must be realized that Germany had a total of 10,000,000 men between the ages of eighteen and forty-eight. Of these, some 9,000,000 are in the army. The percentage of foreign labor will continue to grow as German casualties increase. By the end of 1942, every fourth worker was an alien. At the end of hostilities some of the most capable and skilled labor of other European counties will have to be repatriated. Their health and strength will probably have been impaired. They will require rest and care before they will again be able to work with normal efficiency.



The problem of forced labor came to a head in 1942, when labor shortage, together with growing difficulties of transportation and an increasing deficiency in oil, became the crucial bottleneck. Every known device of persuasion, cajolery, and coercion had been used to draw foreign workers into German war industries. The results were disappointing. Workers preferred starving in their homelands to facing an uncertain future in Germany. Following the introduction of compulsory factory organization along the lines of the German Labor Front in France, whole plants were closed and their workers removed to Germany together with their managers, foremen, and skilled workers. This method was used particularly in industries “collaborating” with related enterprises in the Reich. In other plants, whole groups were organized for the purpose of transplantation into German plants. The Germans placed great expectations in this method of Betriebszellenanwerbung. In the summer of 1942, about twenty groups consisting of a hundred men each were created in the first few weeks of the recruiting campaign.

It soon bogged down, however, and efforts in other occupied countries were equally unsuccessful. This led the German Minister of Labor, Sauckel, to decree what he euphemistically called “planning of European space.” It provided in essence for the extension of forced labor throughout all occupied countries. Until the fall of 1942, the pretense of voluntary employment was dropped only in the Eastern countries. Then it was abandoned in Western Europe too. Sauckel ordered complete conscription of labor and its use under German direction without regard to needs of conquered territories. Germany now has complete priority for every type of man power. Local use of labor is permitted only conditionally and in the following order: first comes work for the German army and German authorities of occupation; in the second place, civilian orders placed by the German army, and for work in agriculture and food industries authorized by Nazi officials (i.e., destined for Germany); and in the third place, industrial work in the interest of the occupied countries, covered by general permit. The shortest week must be of fifty-four hours. If so ordered, all workers must work on Sundays and holidays. Piece rates must be introduced wherever feasible without endangering the wage ceilings. Absenteeism is regarded as a serious crime. The decree is also applicable to prisoners of war.

A veritable manhunt followed the declaration of total labor mobilization by Germany in February, 1943. Hundreds of thousands were rounded up in every country from Norway to Greece. The Nazis ordered the conscription of all men from seventeen to sixty-five and of all women from eighteen to forty-five. The spirit of this unprecedented measure is best gauged from the following semiofficial communication: “Karl Hermann Frank, 'Sudeten' State Secretary of the Protectorate of Bohemia-Moravia, warned the Czechs that labor mobilization will be enforced with the full authority of the Nazi machine. He also announced that all 'non-essential' industries and shops will be closed in order to make their employees available for war industries 'at home and elsewhere in Europe.' Herr Bertsch, German Minister of Economics in the puppet government in Prague, made it plain, at the same time, how far the arm of German conscription will reach. Only one restaurant will be permitted to function in small towns, all small shops will be closed, every person who has ever worked, even members of the family who assist a doctor or a retailer, must now carry a labor card and becomes subject to order to work wherever he or she is assigned.”

At the end of the war, should they unite with their compatriots in countries surrounding Germany before an Allied army of occupation completes the setting up of a military government over Germany, wholesale massacres are to be expected. No more mercy can be expected from the ragged and humiliated slaves than was shown by the Hussite warriors of fifteenth century fame in their inroads into German towns. Forced dispersion of European peoples will prove to the Germans an even worse boomerang than their imposed segregation.



An even more serious problem is presented by farmers and businessmen forcibly ejected from their properties. Since their businesses and farms were usually taken by Germans, they will have nowhere to return. It will be necessary to turn certain Nazi policies against the originators and retake the German loot. Can the original owners get back their former properties, that have been expropriated or sold in the meantime? Another problem will be that of the ownership of securities. Large blocks of stocks and bonds, confiscated in safe deposit boxes in conquered territories or acquired by subterfuge, have been sold in neutral countries. One of the complicating factors will be that few of the European peoples will be willing to continue living close to Germans. It may very well be that large-scale resettlement of German minorities from Poland, Czechoslovakia, Yugoslavia, and other countries will be one of the most pressing tasks of the mass migration which will immediately follow the armistice.

To understand the fundamental problem involved, it is important to realize that the total state exercises complete constraint over the individual. People under totalitarian rule do not “own themselves.” War and occupation by the all-permeating totalitarian state differ from previous experiences — at least in modern ages. It is a personal experience for every one of the sullen and silent millions of Europe. Suddenly these millions will again “own themselves.” Unless plans have been made in advance, the sudden recapture of personal freedom will release tremendous passions and hatreds, and a desire for revenge. For many years the oppressed nations will be unwilling and unable to live together with GermansNazis or non-Nazis. It will be wiser not to stand in their way but rather to channel their dynamism into constructive and productive avenues. To ignore it would only lead to frustration and revolutionary fermentation which might destroy the last remnants of the heritage of Europe.



As the movement of population has been mainly in two directions, the necessity of liquidation of “population dumps” will be particularly acute. Germans from settlements scattered in the more remote parts of Europe and those living in isolated units are being concentrated, mainly on the outskirts of the German-speaking area. They are to form compact nuclei that will serve as nests of Nazi control and for further infiltration. Several districts in Czechoslovakia were first depopulated through removal of Czech peasants, and they in turn were settled by Germans who had lived in the Baltic States. In a way, German population tactics are not dissimilar to the method of the blitzkrieg assault: occupation of a “thrust-point” (Schwerpunkt) followed by successive “fanning out” (aufrollen). These newly created German settlements are also planned to serve as centers of resistance and guerrilla warfare if the tide of war should turn against Germany and necessitate an interior line of defense. They are instruments both of expansion and of protection against the outside. According to German sources a total of 751,400 Germans were removed from other parts of Europe and resettled in these areas up to the end of 1941. Of this total, 80,000 came from Estonia and Latvia, 220,000 from Italian Tyrol, 50,000 from Lithuania, 164,000 from eastern Poland and Russia, 214,000 from Rumania, 6,000 from France, 17,000 from Yugoslavia, 400 from Bulgaria. A change of plans was made in at least one instance. All Germans from Lithuania were sent back to their original domiciles one year after their departure. The settlement was simple enough wherever Germans settled in conquered territory: farms, businesses, and residences of the subject population were expropriated without much bothering about legal details. All such property in western Poland, for instance, was immediately taken over by the Ostdeutsche Landbewirtschaftungs, G.m.b.H. Its official annual report points out with pride that more than thirty-three hundred landed estates and half a million small farms, totaling 12,350,000 acres and owned heretofore by Poles, were expropriated to be distributed among Germans.

Apart from the land, the Polish farmers in this area, at the beginning of the war, owned over a million head of cattle, about a million and a half pigs, and half a million horses. These were included in the confiscation in conformity with Darre's declaration: “All the soil and industrial property of inhabitants of non-German origin will be confiscated, and will be distributed primarily among worthy members of the Party and soldiers accorded honors for bravery in the war. Thus a new aristocracy of German masters will be created.” Admittedly, there is a secondary reason for the dispersion of German farmers: the possibility of consolidating farms within Germany into large, mechanized grain factories.

German settlers were granted a number of privileges. They consisted of tax exemptions and reductions, loans, and, most important of all, priorities in the allotment of raw materials and equipment.

It is planned ultimately to expel the entire Czech nation from their homeland and disperse them somewhere in Russia or Siberia. Such a scheme, which would require the removal of about eight million persons, may seem fantastic. It is probably feasible, given modern methods of transportation. The Nazis also undoubtedly calculate that large numbers will be exterminated before removal takes place. Such actions as the destruction of the town of Lidice are only the beginning of a systematic campaign of decimation. Germany wants to possess Europe free of the encumbrance of these sturdy and tenacious peoples. A similar plan has recently been divulged in Holland. The Nazis' scheme provided for the mass migration of three million Netherlanders to the shores of the Baltic. A new organization, the Netherlands East Company, “a travesty on the old East India Company,” has been created, with an authorized capital of 2,500,000 guilders and with the ability to draw on Germany's “debt” to the Dutch treasury, which amounted in August, 1942, to more than 1,200,000,000 guilders. The capital of the company came from the proceeds of liquidation of eighteen companies formerly trading with the Dutch East Indies. So far the resistance of the Dutch people has blocked any voluntary resettlement. The situation will be different if the Germans are allowed enough time. To carry through this program, Holland would be depopulated and settled by Germans.

A similar fate has already befallen the Slovenes, the northernmost branch of the Yugoslavs. Their intellectual class already has been destroyed. All landed property in German-occupied Slovenia was confiscated for the benefit of the Reich, in order to foster the German character of southern Styria, as reads the official decree. A plan has been set up for the deportation of 250,000 Slovenes to Serbia and Croatia. A large part already has been deported. “Nothing is provided for them when they arrive at their destination. They are just poured out like a sack of wheat and left there to look after themselves.” The Slovenes are devoted Catholics. The clergy were therefore among the first victims of this policy of extermination. Yugoslavia was undergoing a particularly trying time. By the summer of 1942, whole areas already were depopulated. This applies particularly to sections of Yugoslavia in which guerrilla warfare is rampant; namely, to Montenegro, Sandjak of Novipazar, eastern Herzegovina, southeast Bosnia, and western Serbia. “In Northern Serbia (which lies between the guerilla-occupied zone and the Axis-held zone), agricultural regions have been laid waste by deportation and mass executions of the rural population. At the same time, entire sections have been depopulated by the withdrawal of the peasants to the woods. The rural population of the guerilla-controlled areas has been transformed into a mobile fighting force.”

Until 1941, the drafting of foreign workers into Germany did not disrupt entire communities and regions as much as later measures in this direction did. Individual measures became too slow and ineffective in stemming the decline in productivity that spread like a disease over Nazi-Fascist Europe. By 1942, staffs of entire factories, sometimes with machines and equipment, were being taken to Germany. In order to facilitate the handling of homogeneous groups of alien workers, the Germans had to employ them in national groups. It was stated that, by the first half of 1942, about half of the foreign workers lived in 14,580 “community” camps or, better, prisons. Men of every nationality are separated from all contact with women. Foreign women are dismissed when they become pregnant.



Jews were and are, of course, target area number one of German population policies. The Nazis' publicly avowed aim is complete extermination of the Jews, “with a little torture thrown in,” and it is succeeding very well. The Jews of Europe may be divided into two fairly distinct groups: the Western Jews and the Eastern Jews. They share a common fate at present. The Eastern Jews were of the pre-emancipation type, very religious, with a high natural increase. The Jews of Germany, Austria, and the western half of Czechoslovakia were thoroughly assimilated and secularized, and they had a birth rate among the lowest in the world. Their birth rate in Bohemia and Moravia resulted in an average annual decrease of six persons per thousand. In the Reich their number fell from 565,000 in 1926 to 530,000 in 1933; in Austria, from 220,000 in 1923 to 180,000 in 1938, the year of Hitler's invasion. Fewer than half of all persons classified as “non-Aryans” escaped from Greater Germany. Before the outbreak of the war excess of deaths over births removed more than 50,000. Tens of thousands have died since in concentration camps, Polish population dumps, the fortress of Terezin in Bohemia where a majority of Jews from the Protectorate were concentrated; and others either perished building the trans-Saharan railroad, or were on ships torpedoed and sunk on the seven seas.

Thus, in the Protectorate Bohemia-Moravia the prewar Jewish population of approximately 100,000 was reduced to about 40,000 within three years of the date of Nazi occupation. During 1941, Jewish deaths in the Protectorate numbered 4,600 — births, 617. Of the prewar Jewish population of Slovakia, only a third was living there in the summer of 1942, and they were expecting to be deported to half-destroyed villages around Lublin in Poland at any time. All this occurred before the final roundup and extermination which was inaugurated when the Nazis began considering an eventual defeat.

A competent observer, Professor L. B. Namier of the University of Manchester, concludes: “This is the end of Central European Jewry; it is not likely ever to be re-formed… Never since the expulsion from Spain and Portugal has there been so sudden and complete a ruin of a rich and highly educated Jewry.” The effect of its destruction will be felt especially if the Nazis have the time to continue their policy of extermination throughout the rest of Europe. Already Vichy France and all satellite states of the Balkans have fallen in line. The experience thus acquired will later be applied to other ethnic groups, without regard to “Aryanity” but with due regard to their land, wealth, and to all other things coveted by the Germans. The drive against the Jews is a test case. All nations, and especially the small peoples of Europe, are concerned with the conclusion Professor Namier arrives at: “The present anti-Semitic frenzy, which Hitler has raised as much as it has raised him, has wrought changes of which the implications can hardly be gauged as yet; but such is the destruction – moral, social, and physical — that it is no longer reasonable, or even possible, to discuss the Jewish fate and future in pre-war terms.” No nation subjugated by Hitler can know of course, when it will be sentenced to share the lot of the Jews.

Not until the winter of 1942 did the Nazis publicly announce that all the Jews of Europe would be completely and irrevocably exterminated. Up to that time, some hope was left that the Jews would be allowed to save naked life by being segregated and ultimately permitted to leave Hitler's realm. In December, 1942, the order condemning them to death for no other crime than their creed or race was signed by Himmler. Thereupon, hundreds of thousands of Jews all over Europe, from France and Norway to the Balkans, were rounded up like cattle. Even hospitals, insane asylums, and old people's homes were raided. Women, children, old folks were told to take with them clothes and food for four days and nothing else. Mothers were separated from children. Then, all were driven aboard ships or freight cars and dumped into the frozen plains of eastern Poland. If they died too slowly the Gestapo and S.S. slaughtered them outright. It is true that the Jews not only of Poland, but of the rest of Europe as well are “the most deeply humiliated, the worst persecuted, the most recklessly annihilated human group on earth.“ It is easy to be conciliatory for people who have always had plenty of salt water between themselves and the Nazi beasts. It is something entirely different for those who were driven around in search of death. Insensate persecution of helpless people is creating so much explosive sentiment that its repercussions will rock Europe for many years to come.

Hunger may be a more terrible weapon than the sword – and nations are starving already. “If there is hunger, it will not be in Germany,” said Goring in the autumn of 1942, and he meant what he said. Extermination is not a threat; it is a stark and naked fact, visible to anybody who does not close his eyes.

Some are privileged to die in their homes. Millions wander the face of the earth in search of shelter and food. No end is in sight. “The total number of refugees in unoccupied France in the summer of 1940 has been variously estimated at five to twelve million. The majority of these have returned or have been sent into occupied areas, but several million refugees still remain, including about eighty thousand French who were later expelled from Lorraine. The Government General of Poland has been the dumping ground for Poles expelled from provinces annexed by the Reich and for Jews from Germany, Austria, and the various occupied countries. The conditions there in what was already one of the most seriously overpopulated areas in Europe are incomprehensible, especially in the two “isolated Jewish sections in Warsaw and Lodz. There are only dark rumors about the fate of Russian prisoners and the civilian populations engulfed by German armies east of Poland.” The totalitarians act as if to confirm Hobbes' dictum that human life is nasty, brutish, and short.



The problem of reintegration of refugees into their former homes will present a number of difficulties even if, as may be expected, a large proportion of those who have found homes outside Europe should not desire to return.

An expert on problems of food, Dr. J. S. Davis, discussing the food problem of postwar Europe, lists the reestablishment of war prisoners and other uprooted people as one of the essentials of an improvement in nutritional essentials, on the same level as repair of transport facilities, enlargement of international movements of foodstuffs, feedstuffs, other raw materials, and manufactured goods. We are living in a period of migration comparable to the population movements that accompanied the decline of the Roman Empire. Every economic system works out its optimum in the distribution of human resources. Under the impact of conflict with other systems and, as a result of internal change resulting therefrom, the composition. distribution, and character of its population must undergo periods of painful and prolonged adjustment. We are transients — between one period that has ended and another that has not yet begun.

Shifting of entire peoples is only one of the effects of totalitarian domination upon subject populations. Profound changes in the occupational pattern have taken place already and are now proceeding at a greatly accelerated rate. Dislocation of industry, forced labor, and the refusal to continue education are among the three major causes. With universities in a number of countries completely closed, with high schools limited to a small percentage of their former numbers, and the grade schools crippled by introduction of an alien language and even more by alien ideas — the danger of an intellectual decline is no less real than physical dangers. Germany is endeavoring systematically to destroy the intelligentsia of the conquered. They are given priority in persecution, in the taking of hostages, and in outright murder. Fortunately, most of the peoples concerned had a broad base of popular education. Even so, should the war continue for many years, there will develop a vacuum of intellectual leadership which will probably take a generation or so to fill again. Every year the number of physicians, engineers, artists, teachers, and ministers diminishes. Young people are denied any opportunity to study at home or abroad. A bitter, silent fight is taking place for the privilege of possessing an educated class without which a nation would forever be reduced to servitude. Occupational composition of the conqueror would soon radically differ from that of the subject peoples, and another goal would be achieved.

Coupled with the persecution of the educated classes is a continued depletion of what might be termed cultural resources. The real resources of a nation are not composed exclusively of the raw materials, the minerals, the multifarious sources of energy , the productive equipment, and the number of its population, but consist also of the skills, the education, the tradition, the artistic talent, tastes, and inherited qualities which determine production of some commodities more than physical factors do. Germany is depleting the cultural resources of the conquered at an alarming rate. Skilled workmen, whose work in glass, textiles, china, leather, and other materials enriched continental production for generations, are now in German labor camps, in munitions factories, and behind the lines in Russia. Some industries are already so disrupted, and labor skills may have disappeared to such an extent, that it may not be feasible to revive all traditions after the war. There will be certain cultural values that can never be regained. Education and training will be among the most urgent reconstruction jobs — and one of the most difficult, not only in occupied Europe, but in Germany also.

But, even more fundamental, how are we going to cleanse Europe of the poison of “racial economy” — that vicious doctrine which makes biological race the basal factor of an economic and social hierarchy? Under Hitler, race in its crudest and most animal form, inescapable and irrevocable, has been shaped into a cornerstone of economic organization. Since, to the Nazis, race struggle is the essence of human history (as class struggle was to Marx), everything is founded on race competition. The individual is valued only according to his race. His place in the world, his standard of living, his educational opportunities, his social standing are all determined by his race. The tenuousness of the very concept of race makes it the most dangerous weapon at home and abroad. It can be twisted, limited, or broadened as the moment may require. Sometimes the Nazis divide the white race into Aryans and non-Aryans. Sometimes they juggle with Germanic and non-Germanic races, particularly when they try to delude some foreign visitor. Other times they assert the superiority of the German race over all non-German races. Finally, even the Germans are classified according to their Nordic race heritage. When it fits their plans they readily admit the Japanese among the Aryan races. In reality the Nazi concept of race is only pseudobiological, a handmaiden of political and military expansionism.

Their racial theorists have never been able to agree, in spite of all the money spent for their “research,” how many races there really are! H. F. K. Gunther divides the white race into the Nordic, Phalic, Dinaric, “Eastish,” Baltic, and “Westish” races and distinguishes a separate fore-Asiatic race; but there are many Germans who reject his classification for the sake of some other pet scheme. In the last analysis, Hider decides what races there are to be at any given time, and who is to be considered an Aryan. Underlying all this are of course Fichte's belief that the Germans alone are the Urvolk, the primal people, while all other peoples are inferior, and Gobineau's assertion that “the Aryan is to the ordinary white man, what the white man is to the black.” It was of course Gobineau, the French aristocrat, desirous to see the days of the ancien regime and the rule of French nobility back again, who invented the Aryans ninety years ago. In order to give ultimate sanction to domination of man over man and to perpetuate exploitation of man by man, one group is declared to be of superior race, invested thereby with a natural and almost God-willed claim to rule. As a device of enslavement, race is superior to anything else yet invented.

However spurious the German racial doctrine may be, however untenable by any truly scientific standards, it is a very real thing to the conquered peoples who suffer from it. Populations are segregated, shuffled around, bullied, terrorized, abased, and humbled in the name of the race principle. To be born into an inferior race (all races are of course inferior to the Germans) means an irretrievable sentence: lower standards of living, undesirable occupation, exclusion from education and from participation in public affairs. Race becomes the fundamental economic determinant. Race competition is frozen by use of force into race subjection. Races unable or unwilling to accept villenage and servitude must be exterminated without mercy. This is exactly what is happening. Unfortunately, the German doctrine of racial superiority is not just Hitler's invention. Its taproots descend to all major schools of thought in Germany for a period of at least five generations. Hitlerism is only the culmination of German thinking since Frederick the Great and the Prussian revolt against the West. It was a great, and presumably liberal German historian, the eminent Heinrich von Treitschke, who declared that: “each dragoon who knocks a Slav on the head does far more for the German cause than the finest political brain.” Today we witness the culminating madness of Germany: brains are being knocked out by hundreds of thousands, the world is being plunged into mass insanity , German philosophy of racialism is driving millions to despair.

Racial discrimination is an instrument of mass control, of “racial imperialism,” as it has been called. It also is a means whereby members of every race, with the exception of the one ranking lowest, can derive some measure of self-respect and social standing from the fact that there are races lower in the scale. The role of the underdog to the underdogs was assigned to the Jews. Elaborate laws make sure that racial hierarchy is manifested and symbolized in every sphere: clothing, living quarters, food, education, seats in public transportation, names — all these must be outward signs of the degree of inferiority of the group.

How detailed racial regulation has become is indicated not only by the differential treatment of the Poles but also by later ordinances relative to the so-called Ostarbeiter (Eastern Workers), which in the new German language is a very derogatory expression. This is the term applying to workers conscripted in various parts of the occupied Soviet Union, particularly in the Ukraine, White Russia, and the Baltic States. Their wages must never be higher than two-fifths, and in special cases three-fourths of the wages Germans would get for the same kind of work. The difference does not accrue to the employer, but must be paid by him to the German government, in the form of a special tax (Ostarbeiterabgabe). These workers do not receive higher wage rates for overtime, Sundays and holidays, and get no leaves or furloughs. Similar tariffs and regulations were issued for each racial group. Not work done, but race, determines wage scale, as it determines everything else.

There will be an irresistible urge among all national groups that are now living under such unprecedented conditions to apply racial discrimination to Germans the minute they are free. This pressure will be so strong that it should be led into orderly channels rather than opposed. It may even serve a useful purpose by uniting Europe more than anything else could. Without a shadow of doubt, all that the Nazis have done will rebound against them. Not as a matter of vengeance, but in Dr. Benes' words, as a requirement of justice, the unspeakable crimes committed by Germany against civilization will receive their due retribution.



  1. Cf. review of Karl Haushofer, Raumuberwindende Machte, in Schmollers ]ahrbuch, Vol. LIX, Heft 3, p. 121 (]une, 1935).

  2. John B. Condliffe, Agenda for a Post-War World (New York, 1942)

  3. Sir Halford J. Mackinder, Democratic Ideals and Reality (New York, 1942 ed.), p. 150.

  4. Simon Segal, The New Order in Poland (New York, 1942), p. 17. This is a well-documented account of Nazi policies in Poland up to 1941.

  5. Bernhard Menne, German Industry on the Warpath, 1860-1939, p. 28.

  6. L. Grebler and W. Winkler, op. cit., p. 6. The following table is from same source:        DECADE         EXCESS OF BIRTHS        NUMBER OF EMIGRANTS        1881-1890            5,500,000                          1,342,000        1891-1900            7,300,000                             528,000        1901-1910            8,666,000                             220,000

  7. “German Employment of Prisoners and Foreign Civilians,” Foreign Commerce Weekly, III, 175 (Apr. 26, 1941)

  8. Financial Times, London, July 15, 1942. Declaration of Chairman of Dutch Chamber of Commerce in London.

  9. See Major F. O. Miksche, Attack: A Study of Blitzkrieg Tactics (New York, 1942).

  10. German documents quoted in Hospodarske Zaznamy (London, Czechoslovak Research Institute, No.11, May 6, 1942), p. 84.

  11. Ministerialdirektor Lauenstein, “Aufgaben und Leistungen der Ostland im Kriege,” Der deutsche Volkswirt, Vol. XV, Heft 48 (Aug. 29, 1941), pp. 1673 ff.

  12. New York Times, Dec. 6,1940.

  13. “Material und Rohstoffe fur die Ostgebiete,” Der deutsche Volkswirt, Vol. XV, Heft (Jan. 10, 1941), pp. 589-590.

  14. New York Times, Aug. 30, 1942.

  15. Dr. Miho Krek, Central European Observer. Vol. XIX. No.15 (July 24.1942), pp. 231-232.

  16. The Survey of Central and Eastern Europe. No.3 (New York. Central and Eastern European Planning Board, July, 1942).

  17. H. W. Singer, “The German War Economy,” VI, Economic Journal, LII, 193-194 (June-Sept., 1942)

  18. Czechoslovak News Letter, No..37 (London, Sept. 25, 1942), and Statistical Handbook of the Czechoslovak Republic (London, 1941), pp. 10-11.

  19. Conflicts: Studies in Contemporary History (London, 1942; New York, 1943), pp. 144, 138.

  20. Rene Kraus, Europe in Revolt (New York, 1942), p. 324. This is a good general account of happenings in occupied Europe.

  21. F. Lorimer, K. F. Lenroot, and E. J. Coil, “Problems Relating to Migration and Settlement in the Postwar Period,” in International Conciliation, No.379 (Apr., 1942), p. 186.

  22. J. S. Davis, “The World's Food Position and Outlook,” Harvard Business Review, Autumn, 1942.

  23. For excellent exposition of this trend in German thought, consult Rohan D'O. Butler, The Roots of National Socialism, 1783-1933 (London, 1941).

  24. Neue Zurcher Zeitung, Aug. 2, 1942.


Read these other chapters from this book:

bullet Chapter 1 - The Impact of Totalitarian Economy
bulletChapter 7 - Banking and Germanization
bullet Chapter 11 - Psychology of the Subjugated

Frank published three books in addition to his unpublished memoirs. These three books can often be found at used bookstores throughout the United States via .

bullet The Economics Of Force (1941)
bullet The Legacy of Nazism (1943)
bullet Atlantic Dilemma (1964)

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