Abstract

“Planned Capitalism”. A Project to Overcome the World Depression by Means of Qualitative Economic Policy

The permanency and the rigour of the world depression in Germany raised opposition to the traditional market-directed economy, the “capitalistic system”. In 1932 socialistic parties, trade unions and distinguished economists joined in demanding for an economic system in which some or all of the decisions on allocation, production, investment and distribution would be made by a central governmental agency. Political and economic considerations, however, prevented a short-term realization of national economic planning in Germany. Considering this fact some economists worked out projects how to avoid the chaotic disharmony between production and consumption without abolishing the private property of capital goods, the market functions and entrepreneurial activity. These projects, analysed in the present article, tend to balance demand and supply by founding agencies for purchase and sale in each branch of trade. In this way the “free” competition considered as a cause for the economic disequilibrium will be replaced by a marketing “planned” and directed by agencies, acting like compulsory cartels and syndicates. To stop independent policies of pricing and production some measures of control ought to be introduced, culminating in a direct governmental participation in economic planning. This latter measure, however, may arise the question whether the influence of the government will tolerate private economic initiative in the long run. In Germany, for instance, compulsory cartels and syndicates, founded after 1933, helped to change the market-directed economy into a system of national central planning within few years