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• The Liberty Fund Library of the Works of Ludwig Von Mises
• Foreword to the Liberty Fund Edition
• Preface
• Omnipotent Government
• Introduction
• Part I: The Collapse of German Liberalism
• I: German Liberalism
• 1.: The Ancien Régime and Liberalism
• 2.: The Weakness of German Liberalism
• 3.: The Prussian Army
• 4.: The Constitutional Conflict In Prussia
• 5.: The “little German” Program
• 6.: The Lassalle Episode
• II: The Triumph of Militarism
• 1.: The Prussian Army In the New German Empire
• 2.: German Militarism
• 3.: The Liberals and Militarism
• 4.: The Current Explanation of the Success of Militarism
• Part II: Nationalism
• III: Etatism
• 1.: The New Mentality
• 2.: The State
• 3.: The Political and Social Doctrines of Liberalism
• 4.: Socialism
• 5.: Socialism In Russia and In Germany
• 6.: Interventionism
• 7.: Etatism and Protectionism
• 8.: Economic Nationalism and Domestic Monopoly Prices
• 9.: Autarky
• 10.: German Protectionism
• IV: Etatism and Nationalism
• 1.: The Principle of Nationality
• 2.: The Linguistic Group
• 3.: Liberalism and the Principle of Nationality
• 4.: Aggressive Nationalism
• 5.: Colonial Imperialism
• 6.: Foreign Investment and Foreign Loans
• 7.: Total War
• 8.: Socialism and War
• V: Refutation of Some Fallacious Explanations
• 1.: The Shortcomings of Current Explanations
• 2.: The Alleged Irrationality of Nationalism
• 3.: The Aristocratic Doctrine
• 4.: Misapprehended Darwinism
• 5.: The Role of Chauvinism
• 6.: The Role of Myths
• Part III: German Nazism
• VI: The Peculiar Characteristics of German Nationalism
• 1.: The Awakening
• 2.: The Ascendancy of Pan-germanism
• 3.: German Nationalism Within an Etatist World
• 4.: A Critique of German Nationalism
• 5.: Nazism and German Philosophy
• 6.: Polylogism
• 7.: Pan-germanism and Nazism
• VII: The Social Democrats In Imperial Germany
• 1.: The Legend
• 2.: Marxism and the Labor Movement
• 3.: The German Workers and the German State
• 4.: The Social Democrats Within the German Caste System
• 5.: The Social Democrats and War
• VIII: Anti-semitism and Racism
• 1.: The Role of Racism
• 2.: The Struggle Against the Jewish Mind
• 3.: Interventionism and Legal Discrimination Against Jews
• 4.: The “stab In the Back”
• 5.: Anti-semitism As a Factor In International Politics
• IX: The Weimar Republic and Its Collapse
• 1.: The Weimar Constitution
• 2.: The Abortive Socialization
• 3.: The Armed Parties
• 4.: The Treaty of Versailles
• 5.: The Economic Depression
• 6.: Nazism and German Labor
• 7.: The Foreign Critics of Nazism
• X: Nazism As a World Problem
• 1.: The Scope and Limitations of History
• 2.: The Fallacy of the Concept of “national Character”
• 3.: Germany’s Rubicon
• 4.: The Alternative
• Part IV: The Future of Western Civilization
• XI: The Delusions of World Planning
• 1.: The Term “planning”
• 2.: The Dictatorship Complex
• 3.: A World Government
• 4.: Planned Production
• 5.: Foreign Trade Agreements
• 6.: Monet Ary Planning
• 7.: Planning International Capital Transactions
• XII: Peace Schemes
• 1.: Armament Control
• 2.: A Critique of Some Other Schemes Proposed
• 3.: The Union of the Western Democracies
• 4.: Peace In Eastern Europe
• 5.: The Problems of Asia
• 6.: The Role of the League of Nations
• Conclusion

1.

The Weimar Constitution

The main argument brought forward in favor of the Hohenzollern militarism was its alleged efficiency. Democracy, said the nationalist professors, may be a form of government adequate to small countries, whose independence is safeguarded by the mutual rivalries of the great powers, or to nations like England and the United States sheltered by their geographical situation; but it is different with Germany. Germany is surrounded by hostile nations; it stands alone in the world; its borders are not protected by natural barriers; its security is founded on its army, that unique achievement of the house of Hohenzollern. It would be foolish to hand over this invincible instrument to a parliament, to a body of talkative and incompetent civilians.

But now the first World War had resulted in a smashing defeat and had destroyed the old prestige of the royal family, of the Junkers, the officers, and the civil servants. The parliamentary system of the West had given evidence of its military superiority. The war to which President Wilson had assigned the aim of making the world safe for democracy appeared as an ordeal by fire for democracy. The Germans began to revise their political creeds. They turned toward democracy. The term democracy, almost forgotten for half a century, became popular again in the last weeks of the war. Democracy meant in the minds of the Germans the return to the civil liberties, the rights of man, suspended in the course of the war, and above all the substitution of parliamentary government for monarchical half-despotism. These points were, as every German knew, implied in the official program of the most numerous parliamentary party, the Social Democrats. Men expected that the Social Democrats would now realize the democratic principles of their program, and were ready to back this party in its endeavors for political reconstruction.

But from the ranks of the Marxians came an answer which nobody outside the small group of professional Marx experts could have foreseen. We class-conscious proletarians, the Marxians proclaimed, have nothing to do with your bourgeois concepts of freedom, parliamentarism, and democracy. We do not want democracy but the dictatorship of the proletariat, i.e., our dictatorship. We are not prepared to grant you bourgeois parasites the rights of men, to give you the franchise and parliamentary representation. Only Marxians and proletarians shall henceforth rule. If you misinterpreted our stand on democracy, that is your mistake. Had you studied the writings of Marx more carefully, you would have been better informed.

On the second day of the [1918] revolution the Social Democrats in Berlin appointed a new government for the Reich, the Mandataries of the People. This government was a dictatorship of the Social Democrats. It was formed by the delegates of that party only, and it was not planned to give the other parties a share in the government.*

At the end of the war the old Social Democratic party was split into three groups: the majority socialists, the independent socialists, and the communists. One half of the government members belonged to the majority socialists, the other half to the independent socialists. The most radical of the three groups did not participate in the establishment of the government. They abhorred coöperation with the moderate majority socialists, whom they denounced as social traitors. These radicals, the Spartacus group or Communist party, immediately demanded the extermination of the bourgeoisie. Their condensed program was: all power must be in the hands of the Soviets of workers and soldiers. They vigorously rejected every plan to grant political rights to people who were not members of their own party, and they fanatically opposed the parliamentary system. They wanted to organize Germany according to the Soviet pattern and to “liquidate” the bourgeoisie in the Russian manner. They were convinced that the whole world was on the eve of the great proletarian revolution which was to destroy capitalism and establish the everlasting communist paradise, and they were eager to contribute their share to this glorious undertaking. The independent socialists sympathized with the views of the communists but they were less outspoken. This very reserve made them dependent on the communists, whose radical expression struck the keynote. The majority socialists had neither opinions of their own nor a clear idea what policy they ought to adopt. Their irresolution was not due to a change of mind with regard to their socialist convictions but to a realization that a great part of the German socialist workers had taken seriously the democratic points in the Social Democratic program and were opposed to the abandonment of parliamentarism. They still believed that socialism and democracy are compatible, indeed that socialism can only be realized within a democratic community. They neither recognized the incompatibility of socialism and democracy nor understood why Germany should prefer the Russian method of dictatorship to the Western principle of democracy.

The communists were eager to seize power through violence. They trusted to Russian aid but they felt themselves strong enough to conquer even without this foreign assistance. For they were fully convinced that the overwhelming majority of the German nation backed them. They deemed it therefore needless to make special preparations for the extermination of the bourgeoisie. As long as the adversaries kept quiet, it was unnecessary to strike the first blow. If the bourgeoisie were to start something, it would be easy to beat them down. And the first events confirmed this view. At Christmas time, 1918, a conflict broke out in Berlin between the new government and a pugnacious communist troop, the people’s sailors’ division. The sailors resisted the government. The People’s Mandataries, in a panic, called to their aid a not-yet-disbanded body of the old army garrisoned in the environs of Berlin, a troop of dismounted cavalrymen of the former Royal Guards, commanded by an aristocratic general. A skirmish took place; then the government ordered the guardsmen to retreat. They had gained a slight tactical success, but the government withdrew its forces because it lacked confidence in its own cause; it did not want to fight the “comrades.” This unimportant combat convinced the independent socialists that the victorious advance of communism could not be stopped. In order not to lose their popularity and not to come too late to participate in the prospective communist government they withdrew their representatives from the body of the People’s Mandataries. The majority socialists were now alone in the government, alone responsible for everything that happened in the Reich, for the growing anarchy, for the unsatisfactory supply of food and other necessities, for the rapid spread of unemployment. In the eyes of the radicals they were the defenders of reaction and injustice.

There could be no doubt about the plans of these radicals. They would occupy the government buildings and imprison, probably even kill, the members of the government. In vain Noske, whom the government had appointed commander in chief, tried to organize a troop of majority socialists. No Social Democrat was willing to fight against the communists. The government’s situation seemed hopeless when on January 5, 1919, the communists and independent socialists opened the battle in the streets of Berlin and got control of the main part of the capital. But in this utmost danger unexpected aid appeared.

The Marxians report the events that followed in this way: The masses were unanimous in their support of the radical Marxian leaders and in their desire for the realization of socialism. But unfortunately they were trusting enough to believe that the government, composed solely of old Social Democratic chiefs, would not hinder them in these endeavors. Yet Ebert, Noske, and Scheidemann betrayed them. These traitors, eager to save capitalism, plotted with the remnants of the old army and with the gangs hired by the capitalists, the free corps. The troops of reaction rushed in upon the unsuspecting communist leaders, assassinated them, and dispersed the masses which had lost their leaders. Thus started a policy of reaction which finally culminated in the fall of the Weimar Republic and in the ascendancy of Nazism.

This statement of the facts ignores the radical change which took place in the last weeks of 1918 in the political mentality of the German nation. In October and early November, 1918, the great majority of the nation was sincerely prepared to back a democratic government. As the Social Democrats were considered a democratic party, as they were the most numerous parliamentary party, there was almost unanimity in the readiness to entrust to them the leading role in forming the future system of popular government. But then came the shock. Outstanding men of the Marxian party rejected democracy and declared themselves for the dictatorship of the proletariat. All that they had professed for fifty years, in short, consisted of lies. All this talk had had but one end in view, to put Rosa Luxemburg, a foreigner, in the place of the Hohenzollerns. The eyes of the Germans had been opened. How could they have let themselves be deluded by the slogans of the Democrats? Democracy, they learned, was evidently a term invented for the deception of fools. In fact, as the conservatives had always asserted, the advocates of democracy wished to establish the rule of the mob and the dictatorship of demagogues.

The communists had grossly underrated the intellectual capacity of the German nation. They did not realize that it was impossible to deal with the Germans by the same methods that had succeeded in Russia. When they boasted that in fifty years of pro-democratic agitation they had never been sincere in advocating democracy; when they told the Germans: “You dupes, how clever we were in gulling you! Now we have caught you!” it was too much not only for the rest of the nation but even for the majority of the old members of the Social Democratic party. Within a few weeks Marxism and Marxian socialism—not socialism as an economic system—had lost all their former prestige. The idea of democracy itself became hopelessly suspect. From that time on the term democracy was for many Germans synonymous with fraud. At the beginning of 1919 the communists were already much less numerous than their leaders believed. And the great majority of organized labor was also solidly against them.

The nationalists were quick to comprehend this change in mentality. They seized their opportunity. A few weeks before they had been in a state of desperation. Now they learned how to stage a comeback. The “stab in the back” legend had already restored their lost self-confidence. And now they saw what their future policy must be. First they must thwart the establishment of a red dictatorship and prevent the communists from exterminating the nonproletarians wholesale.

The former conservative party [the Social Democrats] and some affiliated groups had in November changed their party name to German Nationalist People’s Party (Deutsch-nationale Volkspartei). In their first manifesto, issued on November 24, they asked “for a return from the dictatorship of one class only to parliamentary government as the only appropriate system in the light of recent events.” They asked further for freedom of the individual and of conscience, for freedom of speech and science, and for equality of franchise. For the second time in German history a party which was essentially antidemocratic presented to the electorate for purely tactical reasons a program of liberalism and democracy. The Marxian methods found adepts; the nationalists had profited from reading Lenin and Bukharin. They had now elaborated a precise plan for their future operations for the seizure of power. They decided to support the cause of parliamentary government, freedom, and democracy for the immediate future in order to be able to overthrow them at a later time. They were ready to coöperate for the execution of the first part of this program not only with the Catholics but also with the majority socialists and their old leaders, who sat trembling in the government palaces of the Wilhelmstrasse.

In order to keep out Bolshevism and to save parliamentarism and freedom for the intermediate period, it was necessary to defeat the armed forces of the communists and of the independent socialists. The available remnants of the old army, when led by able commanders, were strong enough to intervene successfully against the communists.

But such commanders could not be found in the ranks of the generals. Hindenburg was an old man; his role in the war had consisted simply in giving a free hand to Ludendorff; now, without Ludendorff, he was helpless. The other generals were waiting for Hindenburg’s orders; they lacked initiative. But the disintegration of army discipline had already progressed so far that this apathy of the generals could no longer hinder the army’s actions. Younger officers, sometimes even lieutenants, filled the gap. Out of demobilized soldiers, who were not too eager to go back to honest jobs and preferred the adventurous life of troopers to regular work, some of these officers formed free corps, at the head of which they fought on their own account. Other officers pushed aside the more scrupulous officers of the General Staff and, sometimes without proper respect, forced the generals to take part in the civil war.

The People’s Mandataries had already lost all hope of salvation when suddenly help appeared. Troops invaded Berlin and suppressed the communist revolt. Karl Liebknecht and Rosa Luxemburg were taken prisoner and then assassinated. This victory did not end the civil war. It continued for months in the provinces, and time and again broke out afresh in Berlin. However, the victory reported by the troops in January, 1919, in Berlin safeguarded the elections for the Constituent Assembly, the session of this Parliament, and the promulgation of the Weimar Constitution. William II used to say: “Where my guards set foot, there is no further question of democracy.” The Weimar democracy was of a peculiar sort. The horsemen of the Kaiser’s guards had fought for it and won it. The Constitution of Weimar could be deliberated and voted only because the nationalist adversaries of democracy preferred it to the dictatorship of the communists. The German nation obtained parliamentary government as a gift from the hands of deadly foes of freedom, who waited for an opportunity to take back their present.

It was in vain that the majority socialists and their affiliate, the Democratic party, invented one legend more, in order to obfuscate these sad facts. In the first months following the November Revolution, they said, the Marxians discussed in their party circles the question of what form of government would serve best the interests of German labor. The disputations were sometimes very violent, because some radicals tried to disturb them. But finally, after careful deliberation, the workers resolved that parliamentary democracy would be the most appropriate form of government. This magnanimous renunciation of dictatorship was the outcome of a voluntary decision and gave new evidence of the political maturity of German labor.

This interpretation of events cautiously evades dealing with the main problem. In early January, 1919, there was but one political problem in Germany: the choice between Bolshevist totalitarianism under the joint dictatorship of Rosa Luxemburg and Karl Liebknecht, on the one hand, and parliamentarism on the other. This struggle could not be decided by the peaceful methods of democracy. The communists were not prepared to yield to the majority. They were an armed troop; they had gained control of the greater part of the capital and of a good many other places. But for the nationalist gangs and troops and for the remnants of the old army, they could have seized power throughout the Reich and established Bolshevism in Germany. There was but one factor that could stop their assault and that really did stop it: the armed forces of the Right.

The moderate Marxians are correct in asserting that not only the bourgeoisie and the farmers but also the greater part of organized labor was opposed to dictatorship and preferred parliamentary government. But at that time it was no longer a question of whether a man was ready to vote for a party ticket but of whether he was ready to stake his life for his conviction. The communists were only a small minority, but there was just one means left to combat them: by deadly weapons. Whoever wanted democracy—whether from the point of view of his Weltanschauung or simply as the lesser evil—had to attack the strongholds of communism, to rout its armed bands, and to put the government in control of the capital and of the rest of the country. Everyone knew that this was the state of affairs. Every member of the majority socialists was fully aware that not to fight the communists by force of arms was equivalent to yielding to communism. But only a few functionaries of the government made even a lame attempt to organize resistance; and their endeavors failed as all their political friends refused coöperation.

It is very important to understand the ideas which in those fateful days shaped the attitudes of the majority socialists. For these ideas sprang out of the very essence of Marxian thought. They reappear whenever and wherever in the world people imbued with Marxian doctrines have to face similar situations. We encounter in them one of the main reasons why Marxism—leaving its economic failure out of the question—even in the field of political action was and is the most conspicuous failure of history.

The German Marxians—remember, not the communists, but those sincerely rejecting dictatorship—argued this way: It is indispensable to smash the communists in order to pave the way for democratic socialism. (In those days of December, 1918, and January, 1919, the German noncommunist Marxians were still wrapped in the illusion that the majority of the people backed their socialist program.) It is necessary to defeat the communist revolt by armed resistance. But that is not our business. Nobody can expect us, Marxians and proletarians as we are, to rise in arms against our class and party comrades. A dirty job has to be done but it is not our task to do it. Our tenets are contrary to such a policy. We must cling to the principle of class and party solidarity. Besides, it would hurt our popularity and imperil our success at the impending election. We are, indeed, in a very unfortunate position. For the communists do not feel themselves bound by the same idea. They can fight us, because they have the enormous advantage of denouncing us as social traitors and reactionaries. We cannot pay them back in their own coin. They are revolutionaries in fighting us, but we would appear as reactionaries in fighting them. In the realm of Marxian thought the more radical are always right in despising and attacking the more prudent party members. Nobody would believe us if we were to call them traitors and renegades. As Marxians, in this situation we cannot help adopting an attitude of nonresistance.

These oversophisticated Marxians did not see what the German people—among them millions of old party members—realized very well: that this policy meant the abdication of German Marxism. If a ruling party has to admit: This has to be done now; this is the necessity of the hour; but we cannot do it because it does not comply with our creed; somebody else has to fill the gap—it renounces once and for all its claims to political leadership.

The noncommunist Marxians severely blame Ebert, Noske, and others of their leaders for their coöperation with the nationalist vanquishers of the communist forces. But this coöperation consisted in nothing more than some consultations. It is likely that the frightened Mandataries of the People and their aides did not conceal in these talks with the nationalist commanders that they were frightened and powerless and would be glad to be saved. But in the eyes of the adamant supporters of the principle of class solidarity this already meant treason.

The outstanding fact in all this is that German communism was defeated by the Right alone, while the noncommunist Marxians were eager to stay neutral. But for the nationalist armed intervention, Germany would have turned to Bolshevism in 1919. The outcome of the events of January, 1919, was an enormous increase in the prestige of the nationalists; theirs was the glory of having saved the nation, while the Social Democrats became despicable. Every new communist upheaval repeated the same experience. The nationalists fought the communists single-handed, while the Social Democrats hesitated to oppose their “communist comrades.” The Social Democrats ruled Prussia, the paramount state, and some of the smaller states of the Reich; but they ruled only thanks to the support they got from the nationalists of the Reichswehr and of the free corps. From that time on the Social Democrats were at the mercy of the Right.

The Weimar Republic was regarded both by the nationalists and by the communists only as a battleground in their struggle for dictatorship. Both armed for civil war; both tried several times to open the attack and had to be beaten back by force. But the nationalists daily grew more powerful, while the communists gradually became paralyzed. It was not a question of votes and number of members in Parliament. The centers of gravity of these parties lay outside parliamentary affairs. The nationalists could act freely. They were supported by the majority of the intellectuals, salaried people, entrepreneurs, farmers, and by a part of skilled labor. They were familiar with the problems of German life. They could adjust their actions to the changing political and economic conditions of the nation and of each of its provinces. The communists, on the other hand, had to obey orders issued by ignorant Russian chiefs who were not familiar with Germany, and they were forced to change their policies over night whenever the central committee of Moscow ordered them to do so. No intelligent or honest man could endure such slavery. The intellectual and moral quality of the German communist leaders was consequently far below the average level of German politicians. They were no match for the nationalists. The communists played the role in German politics only of saboteurs and conspirators. After January, 1919, they no longer had any chance of success. Of course, the ten years of Nazi misrule have revived German communism; on the day of Hitler’s collapse they will be the strongest party in Germany.

The Germans would have decided in 1918 in favor of democracy, if they had had the choice. But as things were, they had only the choice between the two dictatorships, of the communists and of the nationalists. Between these two dictatorial parties there was no third group ready to support capitalism and its political corollary, democracy. Neither the majority socialists and their affiliates, the Democratic party, nor the Catholic Center party was fitted for the adoption of “pluto-cratic” democracy and of “bourgeois” republicanism. Their past and their ideologies were strongly opposed to such an attitude. The Hohenzollerns lost their throne because they rejected British parliamentarism. The Weimar Republic failed because it rejected French republicanism as realized from 1875 to 1930 in the Third Republic. The Weimar Republic had no program but to steer a middle course between two groups aiming at dictatorship. For the supporters of the government parliamentarism was not the best system of government. It was only an emergency measure, an expedient. The majority socialists wanted to be moderate Marxians and moderate nationalists, nationalist Marxians and Marxian nationalists. The Catholics wanted to combine nationalism and socialism with Catholicism and yet to maintain democracy. Such eclecticism is doomed. It does not appeal to youth. It succumbs in every conflict with resolute adversaries.

There was only one alternative to nationalism left: the adoption of unrestricted free trade. Nobody in Germany considered such a reversion. It would have required an abandonment of all measures of Sozialpolitik, government control and trade-union pressure. Those parties that believed they were fighting radical nationalism—the Social Democrats and their satellites, then the communists, the Center, and some farmer groups—were, on the contrary, fanatical supporters of etatism and hyper-protectionism. But they were too narrow-minded to see that these policies presented Germany with the tremendous problem of autarky. They simply shut their eyes. We should not overrate the intellectual capacities of the German masses. But they were not too dull to see that autarky was the focal problem of Germany and that only the nationalist parties had an idea (although a spurious one) of how to deal with it. While the other parties shunned a discussion of its dangers, the nationalists offered a plan for a solution. As this plan of world conquest was the only one offered to the Germans, they endorsed it. No one told them that there was another way out. The Marxians and the Catholics were not even keen enough to point out that the Nazi plan of world domination was doomed to military failure; they were anxious not to hurt the vanity of the people, firmly assured of their own invincibility. But even if the adversaries of aggression had adequately exposed the dangers and the risks of a new war, the plain citizen would still have given preference to the Nazis. For the more cautious and subtle Nazis said: We have a precise plan for the salvation of Germany; it is a very risky plan and we cannot guarantee success. But anyhow it gives us a chance, while no one else has any idea how to deal with our serious condition. If you drift your fate is sealed; if you follow us there is at least a prospect of success.

The conduct of the German Left was no less an ostrich policy than that of the Left in Great Britain and in France. On the one hand, the Left advocated state omnipotence and consequently hyper-protectionism; on the other hand, it gave no thought to the fact that within a world of autarky Germany was doomed to starvation. The German Marxian refugees boast that their parties made some—very lame and timid, indeed—endeavors to prevent German rearmament. But this was only a proof of their inconsistency and their inability to see reality as it was. Whoever wanted to maintain peace had to fight etatism. Yet the Left was no less fanatical in its support of etatism than the Right. The whole German nation favored a policy of government interference with business which must result in Zwangswirtschaft. But only the Nazis grasped the fact that while Russia could live in autarky Germany could not. Therefore the Nazis succeeded, for they did not encounter any party advocating laissez faire, i.e., a market economy.

[* ]It is important to realize that the Social Democrats, although the largest single group in the Reichstag of monarchical Germany, were far outnumbered by the other parties combined. They never got the support of the majority of the voters. Never during the Weimar Republic did all the Marxian parties together succeed in polling an absolute majority of votes or winning an absolute majority in the Reichstag.