Europaische WirtschaftsGemeinschaft
BEING in Translation:
EUropean Economic Community
Von:
ReichsWirtschaftMinister u. President der Deutschen ReichsBank Funk;
Professor Dr. Jecht, Berlin; Professor Dr. Woermann, Halle;
Dr. Reithinger, Berlin; MinisterialDirektor Dr. Benning, Berlin;
Gesandter Dr. Clodius, Berlin, und GauWirtschaftsBerater Professor
Dr. Hunke, Berlin

Mit einer EinFuhrung von:
GauWirtschaftsBerater Professor Dr. Heinrich Hunke
President des Vereins Berliner Kaufleute und Industrieller

HerausGeGeben von dem
Verein Berliner Kaufleute        und der        Wirtschafts – HochSchule
Und Industrieller                                                                        Berlin

Published
BERLIN 1942
Second edition 1943
Haude & Spenesche VerlagsBuchHandlung Max Paschke

------------------------------------------------------------------------------------------------------------------------------
To assist non Germans, reading the above, certain letters have been capitalised for convenience ONLY

Pamphlet #09

Europaische WirtschaftsGemeinschaft

BEING in Translation:
EUropean Economic Community

Von:
ReichsWirtschaftMinister u. President der Deutschen ReichsBank Funk;
Professor Dr. Jecht, Berlin; Professor Dr. Woermann, Halle;
Dr. Reithinger, Berlin; MinisterialDirektor Dr. Benning, Berlin;
Gesandter Dr. Clodius, Berlin, und GauWirtschaftsBerater Professor
Dr. Hunke, Berlin

Mit einer EinFuhrung von:
GauWirtschaftsBerater Professor Dr. Heinrich Hunke
President des Vereins Berliner Kaufleute und Industrieller

HerausGeGeben von dem
Verein Berliner Kaufleute        und der        Wirtschafts – HochSchule
Und Industrieller                                                                        Berlin

Published
BERLIN 1942
Second edition
1943
Haude & Spenesche VerlagsBuchHandlung Max Paschke

------------------------------------------------------------------------------------------------------------------------------
To assist non Germans, reading the above, certain letters have been capitalised for convenience ONLY

Pamphlet #09
Being the NINTH series of Pamphlets being published on the internet at: www.SilentMajority.co.UK/EUroRealist/Germany1942
Greg Lance-Watkins, who has overseen this project for SilentMajority over the last few years would like to thank ALL those who have helped in tracking down the original full text in German, and the short term acquisition thereof, for photocopying., Also for the lengthy process of accurate translation and independent checking of the translation work.
The original copy is available for inspection at Glance Back Books in Chepstow.

The final pamphlet in the series will contain ALL the maps and relevant charts, together with a brief summary of the document.
The European Economic Community 

Mr. Funk, the Reich’s Economic Minister and President of the German Reichsbank

Professor Dr. Jecht, Berlin

Professor Dr. Woermann, Halle

Dr. Reithinger, Berlin, Ministerial Director

Dr. Beisiegel, Berlin

Secretary of State Königs, Berlin

Director Dr. Benning, Berlin

Ambassador Dr. Clodius, Berlin and Economics Committee Advisor

Professor Dr. Hunke, Berlin

With an introduction by

Economics Committee Advisor, Professor Dr. Heinrich Hunke, President of the Society of Berlin Industry and Commerce

Issued by

The Society of Berlin Industry and Commerce and the Berlin School of Economics

Second Revised Edition (Berlin 1943)

Haude and Spenersche Publishing House Max Paschke

Preface to the First and Second Edition

This text contains the lectures presented under the title “The European Economic Community” by the Society of Berlin Industry and Commerce at the start of 1942 in conjunction with the Economic Advisor to the Berlin Committee of the NSDAP and The Chamber of Trade and Industry.  The order of lectures was as follows:

•	Walter Funk, Reichs Economic Minister and President of the Reichsbank:
“The Economic Face of the New Europe”

•	Dr. Horst Jecht, Professor at The Berlin School of Economics:
“Developments towards the European Economic Community”

•	Dr. Emil Woermann, Professor at Halle University:  
“European Agriculture”

•	Dr. Anton Reithinger, Director of the Economics Department of I.G. Farbenindustrie A.G., Berlin: 
“The European Industrial Economy”

•	Dr. Philipp Beisiegel, Ministerial Director of the Reich’s Labour Ministry:
 “The Deployment of Labour in Europe”

•	Gustav Koenigs, Secretary of State, Berlin: 
“Questions About European Transport”

•	Dr. Bernhard Benning, Director of the Reich’s Credit Company, Berlin: 
“Questions About Europe’s Currency”

•	Dr. Carl Clodius, Ambassador of the Foreign Office:
 “European Trade and Economic Agreements’’

•	Professor Dr. Heinrich Hunke, Economic Committee Advisor of the NSDAP, President of Germany’s Economic Publicity Agency and the Berlin Society of Industry and Commerce: 
“The Basic Question: Europe - Geographical Concept or Political Fact?”

The lectures met with considerable interest and very strong agreement. On account of this, we feel we should make them available to a wider circle of people.
Berlin, September 1942

The Society of Berlin’s Trade and Industry - The President: Professor Dr. Heinrich Hunke, Advisor to the Economics Committee

The Berlin School of Economics - The Rector: Dr. Edwin Fels, Professor of Geography

	Index	Page	
Preface		  2	
Hunke	Introduction	  8	
	The Discussion So Far and its Results 	  8	
	Economic Practice	  9	
	Problems Related to Economic Community of Continental Europe             	 10	
PAMPHLET #01			
Funk	The Economic Face of the New Europe    	 15	
	Real and False Economic Freedom 	 15	
	Co-operation in Continental Europe	 18	
	Europe’s Resources and Completion 	 20	
	Directing of the Economy by the State and Work 
                     between the States of the Community	 22	
	The Movement of Payments between the States and European Currency Issues	 24	
	Securing the Area and Economy of Europe	 27 	
	The Will for Co-operation in the Economic Community               	 28	
PAMPHLET #02			
Jecht	Developments towards the European Economic Community 	 30	
	The European Economic Community and its Enlargement    	 30	
	The Problem of the European Economic Area in Late Antiquity and 
                                                                                            the Middle Ages	 31	
	Recent Changes to the Problem of the Area of Europe 	 33	
	The Formation of the Nations and Independent Economies  	 33	
	Overseas Expansion and its Consequences for Europe       	 34	
	The Release of England from the Continent and the Formation of the 
                                                                                  “Free Global Economy”	 35	
	Europe’s Economic New Order: The Present Task                             	 37	
	Collapse of the Previous World Economy	 38	
	Means and Objectives of the European Economic Community        	 39	
	Outlook                                                  	 41	
PAMPHLET #03			
Woermann	European Agriculture                           	 42	
	The Development of Agricultural Enterprises and 
                                             the Structure of  Europe’s Food Economy 	 42	
	The Formation of the Division of Labour in World Agriculture                  	 47	
	Production Increase in Germany and Italy                                       	 49	
	The Supply Situation under the Influence of Economic Restrictions and Change                                                                    	 50	
	Political Consequences for Production                                               	 52	
	Possibilities of Increasing Europe’s Food Production 	 53	
PAMPHLET #04			
Reithinger	The European Industrial Economy                                   	 59	
	The Development of Industry in the 19th Century                              	 59	
	Stages of Technical and Economic Development                             	 60	
	Socio-Political Effects                                                                       	 60 	
	The Loss of Europe’s Hegemony in the World War                        	 61	
	The Transition to State Direction and Planning                              	 62	
	New Europe and its Shared Features                                             	 64	
	Regional Differences in Europe                                            	 66	
	The Major Powers at War - A Comparison of their Capabilities                 	 68	
PAMPHLET #05			
Beisiegel	The Deployment of Labour in Europe                           	 71	
	Population Density, Number and Structure of the Employed  	 71	
	People - The Wealth of Europe                                                                       	 72	
	Worker Exchange on the Basis of Inter-State Agreements            	 75	
	Adaptation of the Organisation for Labour Deployment      	 78	
	Employer Action and Order Switching   	 79 	
PAMPHLET #06			
Koenigs	Questions about European Transport                               	 81	
	“Technical Unity” in the Railway System	 82	
	The Magna Carta of Europe’s Internal Riverboat Traffic	 84	
	Motorways’ Contribution to the European Transport Community	 87	
	Community Work in Shipping                                                             	 88	
	Joint Work in Air Traffic                                                                    	 89	
PAMPHLET #07			
Benning	Questions about Europe’s Currency                                   	 91	
	Currency’s Two Sides                                                                         	 91	
	The Internal Economic Situation of Europe’s Currencies  	 92	
	Managing Foreign Exchange and Bilateral Settlements   	 92	
	Development of Multi-Lateral Settlements                                           	 94	
	The Problem of the Clearing Balances                                              	 95	
	Adjustment of Europe’s Exchange Rates                                          	 96	
	Future Formation of the European Currency System    	 97	
	Europe’s Future Currency Relationship to the Currencies of Other Major Nations 	 99 	
	What about Gold?                              	100	
	The European Currency Bloc                                                              	101 	
PAMPHLET #08			
Clodius	European Trade and Economic Treaties                                  	102	
	The Period of the Old Trade Policy                                                        	102	
	German Economic and Trade Policy since 1933                                      	103	
	Changes to Trade Policy Caused by the War                                          	105	
	The Reversal of the Law of Supply and Demand                                   	106	
	The Question of Labour Deployment in Europe                                         	106	
	The Problem of Traffic                                                                             	106	
	Effects of the English Blockade on Europe                                               	106	
	Principles of European Co-operation                                                           	107	
	The European Regional Principle                                                                 	107	
	Europe’s Economic Independence                                                               	107	
	Europe and the Global Economy                                                                	108	
	Internal Preconditions of a European Economic Community                  	109	
	Ways to Achieve European Co-operation                                                     	111	
PAMPHLET #09			
Hunke	The Basic Question: Europe – Geographical Concept or Political Fact?      	113	
	New Learning and Thought                                                                            	113	
	Starting Point for European Task 	114	
	Three Eras                                                                                                        	114	
	The Character of the Global Economy                                                          	114	
	Political Weakness of Continental Europe due to the Idea of 
                                                                         English World Superiority      	116	
	Britain’s Dominant Theory about the Modern National Economy	117	
	The Foundation of the European Economic Community                                     	118	
	Categories within the European Economic Community                                              	119	
	Three Principles                                                                                               	119	
	A New Era                                                                                                        	121	
	Taking a Look Back to the Past and to the Future               	123	
PAMPHLET #10
	The Illustrations – Maps, Charts etc. Summary of the series and Comments
	Request for help locating further FACTS
		Including Reinhard Heydrich’s 1942 Reichs Plan for The Domination
of EUrope – published in Berlin in 1942 believed to have been November.
ALSO – details of the Berlin Conference of 1944 Titled ‘How Will Germany Dominate The 
Peace, When It Loses The War.’ & details of the massive amounts of cash moved 
out of Germany during the war to safeguard the future of German domination against the economic collapse of losing the Second World War against EUropean Union. AND connections with organisations like The Bilderbergers, Council for Foreign relations, Tri Lateral Commission and other arms of the New World Order.

Introduction - by Professor Dr. Heinrich Hunke, Economic Committee Adviser to the NSDAP, President of Germany’s Economic Publicity Agency

Around the end of 1939, most of Europe was either consciously or unconsciously under the influence of the economic concept of England.  Over recent years, however, it has been swept out of European countries, politically, militarily and economically.  Politically the three-power pact has given honour once again to the ancient figures of life, people and room.  It has also established a natural order and a neighbourly way of co-existing as the ideal of the new order.  The foundation of English economics, which is the basis of the balance of powers, has been militarily destroyed.  And economically, a change has come about following the political and military development, the shape of which is easy to describe, but whose final significance is very difficult to evaluate.  I can only repeat, that the changing order that is happening now has to be ranked as one of the greatest economic revolutions in history.  It signifies a reversion of the economy of Europe to a time before the English concept of building an overseas Europe, i.e. an awareness of one’s own country.

The Discussion so far and its Results

Discussions about questions relating to Europe started as the power of the NSADP grew.  At the Congress of Europe in Rome from 14th to 20th November 1932, Alfred Rosenberg developed, for the first time in front of an international forum, thoughts and ideas that have moved us since.  No one, who fights for a new economic order in Europe, can ignore these perceptions and conclusions.  The economic and political wheel was set in motion, when the NSDAP declared the militarisation of the German economy.  It is to the credit of the journal ‘Germany’s Economy’ that it first seized these questions in 1932, kept on bringing them up and stuck doggedly to those original perceptions.  The idea of German economic self- sufficiency in the new political sense and the German economic militarisation are synonymous with this journal.  Besides this, Daitz, the ambassador, has earned the special credit of being the first to have related German economic history to the present time.  Part II of his selected speeches and essays, which appeared in 1938 under the title ‘Germany and the European Economy’, summarizes his concepts formed between 1932 and 1938.  The Italian, Carlo Scarfoglio, delivered with his book ‘England and the Continental Mainland’, a decisive historical contribution to the consciousness of the European continent.  Meanwhile German and Italian economic policy drew the political consequences from the historical lessons that were learnt during the blockade and learnt again during the sanctions.  The speech made in Munich in 1939 by the leader of the Reich’s farmers, R. Walther Darre, at the 6th Great Lecture at the Commission of Economic Policy of the NSDAP, takes a special place in the discussion at that time.  Its theme was “The market order of the National-Socialist agricultural policy - setting the pace for a new foreign trade order.”

While our leader maintained the hope of reaching a peaceful agreement with England, the route for European economic unity remained problematic.  The end of 1939 was a decisive point and it was natural that the years 1940-1941 heralded the new economic and political order.  The writer, in particular, developed and extended in speech and writing the intellectual fund of the new economic policy, which has been translated into most languages, so that today everywhere the great constructive texts are known.  These contexts revolve around the following issues:

1.	Theory about the Reich and the European economy.

2.	The historic, cultural, and economic significance of the German economic order.

3.	The foundations of the future economic relationships between the states.

4.	The nature of the European economic community.

On 25th June 1940 the Reich’s Economic Minister, Funk, publicised in his official capacity his thoughts, which underlined the development so far and thus gave them state sanction.  In October, the journal ‘German Economy’ summarised for the first time the principles of European co-operation, the fundamental principles of German foreign trade, Germany’s export economy and ways and means of promoting export.  It did so in a popular review “About A New Europe”, providing an overview of the important problem of European economic fusion.  Around the end of 1940 the Berlin historian Fritz Rorig finally outlined in his book “Hanseatic Essence” the historical foundations of the greatest economic and political achievement by the Germans.

I am clear in my mind that total clarity is to be found in the principle questions: The necessity is recognised for a political order for the economic co-operation of the people.  The nature of the new order which is: awareness of tradition, using up one’s own economic resources, long term economic agreements and fair relations, is affirmed.  The economic inter-dependence is underlined by fate.  The economic unity of Europe is thus evident.

Economic Practice

Even practical economic life has increasingly allowed entry to new thoughts.  I am able to see the decisive steps in the start and realisation of the following points:

1.	In the increasing payment traffic through Berlin.

2.	In the exchange of experiences in various areas of economic life.   Thereto belong also the statements of ministers and business people, the calls made by special advisers and the collective tackling of important tasks relating to the economy.  Even the specialist is surprised, once he has taken the trouble to put together all the connections.  Today they are already legion.

3.	In the signing of long term economic agreements between the Reich and the other European states, which the public is aware of.  There can be no doubt that such agreements are those of the future.  

Of course, that cannot prevent unclear points and new problems from arising, which become evident at the time when the situation is reviewed.

Problems Related to the Economic Community of Continental Europe

These unclear points primarily relate to the concept of economic direction, the extent of solidarity and neighbourly attitude, the development of one’s own powers, the care to maintain the standard of living and the question of raw material purchase from foreign countries. It is natural that one or another issue will take priority of interest, depending on the set of conditions that prevail.  It should be attempted at this point to give a reply, albeit a summary one.

There can be no doubt that the concept of direction of the economy, or rather its leadership, is as novel as it is revolutionary.  Its classification is all the more important, as the fate and consequence of European co-operation depend principally on a new consistent form of economic understanding.  The Anglo-Saxon view of economics is dead: consequently, even the so-called ‘classical’ national economy is no longer classical, but it has survived.   So what it comes down to is that a new understanding arises to do with ideology and terminology, which represents a sound basis for agreement and co-operation.  Relating to this, one must point out the following in detail:

1.	Economic direction is not a momentary emergency solution, instead it forms the core of new theory and practice.  First of all, it takes the place of individual egotism and the automatic autonomy of the Anglo-Saxon precept.

2.	Economic direction is not identical to the tendencies of a centrally planned economy.  It does not seek to cancel the individual or to administer through the state operators.

3.	Economic direction really means the following: the new instruction of the creative and constructive power of the individual in relation to the whole system; the creation of a consistent economic view and an attitude towards the economy; the selection of important tasks through political leadership and the state’s final decision on all questions about economic power.  Beyond this, the economy is free and responsible to itself.  

The degree of solidarity of the individual economies and their neighbourly attitude is characterised by three guidelines: 

Firstly, it is limited in regard to its own economic development by the recognition that the utilisation of individual resources represents not only a requirement of the new economic precept, but is the very foundation for economic activity.  The European economic community has no interest in leaving any abilities or possibilities unutilised.  

Secondly, it contains the obligation that, because of Europe’s freedom, consideration is given firstly to continental Europe regarding any matter related to economic activity.  Not only should the shared fate of the European people be emphasized, but the fact should also be stressed that the supplementation of the European economies beyond their borders is possible and sought after.

Thirdly, it must be maintained that, above all else, the spirit of the individual economies may not be allowed to go against the spirit of neighbourly co-operation.

The question of developing one’s own powers refers to the problem of monocultures, of industrialisation of the agrarian south-east and the awakening of new needs.

An answer can easily be given to the first question.  Monocultures are the result of the same economic precept that made the world market price the determining factor in the economy.  According to that precept, people and land are the vestiges of some by-gone age.  Europe is well on the way to destroying these monocultures with initiatives ranging from land improvements and growing new crops to discovering new local resources.  All these have the same aim, which is to develop the economy and broaden its basis.  Germany and the whole of Europe can only greet these efforts with gratitude.

The industrialisation of the south-east poses a particular problem regarding these questions.  As I am unable to handle this problem - like all other problems - here in a comprehensive and exhaustive manner, because the industrialisation of economies is theoretically a difficult problem, I can only say as follows:

1.	Just as it is in the nature of things that each country will strive to utilise its available resources for its own production, so will there will be a knock-on effect for other economic partners.

2.	If, as is the case in the South-east European countries, there is heavy 
over-population in the countryside, then there are only three possibilities to solve it: itinerant workers, a permanent emigration and an ‘intensivisation’ of the local economy, a term correctly created by Dr. Ilgner for the problem of industrialisation.  Itinerant workers can only form a part solution.  Besides, it only applies to agricultural and construction workers and gone on for ages.  Permanent emigration from Europe is just as false as impossible.  There just remains the intensivisation of the economies of south-east Europe as the way to self-help.

3.   The economies should make it possible for an independent life according to the modern economic view.  The intensivisation of their economies therefore is right for the time.

4.   The old features of industrialisation, which evolved from the price collapses in countries with agriculture and raw materials, have to now belong to the past.  Europe is a communal living area.  Only through a joint development of economies - and not through independence from one another - can protection against crises be achieved.

5.    The tasks that have to be solved in Europe are so big that the powers needed to do so have to be released by an intensivisation of the individual economies.  This can be easily done by employing the workers that have been liberated in new branches of the economy.

Without affecting the difficult questions of purchasing power, it can be regarded as proven that the joint work to build up Germany’s and the south-eastern states’ in the area of industrialisation lies in the direction of the intensivation of interest of the whole continent.  

One important and until now completely overlooked task in this regard exists and that is the awakening of new needs in the south-eastern countries.  It is because, in those countries, wealth has grown and will gradually continue to grow, as a result of the reliable purchase of agricultural products and available raw materials at adequate price levels.  According to the principle in economics that giving equals taking, peoples’ living habits there will have to change, otherwise one day the process will come to a halt.  Germany’s ability to absorb the products from the south-east is practically infinite, whereas creating a demand for German goods there is not only a matter for economic intensivation but also one of modifying the people so they consume more.  This task is of such importance that it has to be considered from the very outset, so that the south-eastern European economies are elevated after the war.

Equally important as the industrialisation of south-east Europe is the question of the standard of living in the north.  Their economic development and high standard of living, which underpin their lives though all economic conditions, should not be mistaken.  This standard of living has grown considerably during the 19th century and around the time of the world war due to free trade, so that various circles view world economic events with particular concern.  From a German viewpoint, only the following points can be made:

Firstly, a higher standard of living is also the aim of the German government. The German people not only understand this well, but also through its fight wants to ensure European civilisation and culture.  This fight will benefit the whole of Europe, and with it the north.

Secondly, despite being connected successfully to England and its economic system (one should not ignore the countless economic troughs that feature there), the economies of the north whose fate and greatness are very closely linked to Germany.

Thirdly, the northern states’ difficulties are going through a temporary phase of adjustment.  In the long term, this will bring about a lasting advancement, rather than destruction, for their economies’ foundations.

Maintaining a high standard of living is not an insoluble problem.  To finish, I now come to the problem of purchasing raw materials from overseas markets.  A leading south-east European economist once wrote about this principal question: “Unlike the war, we were in the following situation: in order to import raw materials from overseas countries, we bought goods from west European countries with foreign exchange.  In the area of continental Europe there is no gold.  Everything had to pass through the system of clearing - goods sold against goods. We have no product that can be sold to North or South America.  That means that the leading nations are obliged to acquire and distribute to us the raw materials that we need.  The leading nations of Europe can supply, with its capacity, enough products to overseas countries with which to acquire raw materials.  The one question is whether exchange will ever happen… Even before the new order is introduced, and without even joining in with the Axis powers, we stand in solidarity outside Europe with its traffic of goods…”

We can only agree with this view, leaving the matter open, as the Reich’s Economic Minister Funk described, how large the direct sources of help will be and whether raw material acquisition from overseas will take place through the system of clearing or free flow of currency.  With the introduction of the multi-lateral clearing system, on a practical level there is no change from the pre-war time.  As this learned person said, “All the benefits of the method of paying are regained from the system of free currency.”  Nor can it be realised - contrary to him - that this system of clearing through Berlin should function without those countries outside the European system. But the decisive factor is the way in which the continent is bound to Germany and Italy by one fate.

Since 1940, therefore, we are faced with an unparalleled economic and political revolution.  The problems created for us are large but can be solved.  Their solution will give Europe the peace it yearns for and will bring a great era of joint development.  It is worth fighting and working for this. 

 The following discourses should contribute to helping us to broaden and deepen our understanding of the tasks and nature of the European economic community.

The Basic Question: Europe - Geographic Concept or Political Fact by Prof. Dr. Heinrich Hunke
Economics Committee Adviser of the NSDAP, President of Germany’s Economic Publicity Agency

New Learning and Thought

Since the start of World War I, Germany, Europe and the whole world has had an object lesson in economics and economic policy full of truly bitter experiences for all concerned and which, on the other hand, provides new perspectives of unimaginable magnitude.  True, crises happened before the world war; the wealth of great nations’ had been wiped out by violent conflicts and in the American Civil War, economic warfare emerged as a new weapon.  But the last 25 years have shaken the spiritual and practical structure of the economy in such a way as no other period.

In August 1914, the world held as absolutely true the belief that the economy was something that existed on its own and was a law unto itself.  It was the President of the Issuing Bank and the men of commerce, professors and lay-people who noted from the inexorable increase in global trade both the signs and the nature of a new economic era. Now, 25 years later, the economy has become controllable, one used to serve its people, and now experts and theoreticians are involved in gaining more knowledge about economic and political life.

We in Germany had to deal with the problems of economic reconstruction very early on, so we were the first to get away from the idea of everything being determined by the automatic laws of economics.  It was National Socialism that was first to recognise that work represents the foundation and wealth of a social economy. This means that work has to be the corner stone of any future moral order.  Here, then, is the Archimedes Principle that can turn the whole capitalist economy upside down.  We have also learned that the main tasks ahead can be recognised and affirmed without the belief that they can ultimately be achieved.  What is required is a clear understanding of what stands before us, without which the desire to tread new economic paths will never be present.

In 1923 in Germany the ever-depreciating reichsmark created a feeling of impossibility and moral derangement.  The creation of the ‘stabilised mark’ was an unexpected miracle for most of us.  In 1932 we all saw that we had to solve unemployment, but the old doctrine failed to see any possibility of doing this.  It started with the crystal clear understanding of a few people about economic processes, then the faith of many people and the iron resolve of one individual who sought the solution of this massive task, which flew in the face of all previous experience.

Today we are faced with similar tasks together with the other European nations, such as rebuilding the European economy, mobilising our agricultural sector, industry and transport.  Solving these problems keeps providing us with new perspectives and challenging the theories and practices of the past.

Two things appear necessary to us now: firstly, everyone needs to be made aware of the tasks that face us.  Therefore it pleases me that it has been possible for our leading experts to discuss here the economic problems of labour deployment, agriculture, industry, transport, currencies and European co-operation.  Then these tasks have to be recognised, understood and carried out unanimously.  This is the most difficult thing.  In this period of new thinking it is more important than ever before to create a link between word and deed, because the effective solution of a problem relies on it first being unanimously recognised.

Finally I want to make some basic observations about the situation today regarding the economic problem in Europe and try to establish a direction for the solution of the political and economic problems.  In doing so, I hope to make a significant contribution to the problem of our enlarged area.  To me they appear all the more important when this important concept lies hidden under other issues and is exposed to the same dangers.

The Starting Point for the European Task

Three Eras

In considering this question what has to be held true is that the creation of the European economic community is a totally natural manifestation of the regeneration of the old continent.  A quick look at the last 450 years since Christopher Columbus landed on the Coral Island in the West Indies shows this clearly.

Firstly there is an argument that Europe lived up to 1942 from its own energy and built up its own great culture and economy.  This fact remains beyond doubt.

In purely economic terms, the discoveries had absolutely no significance for the European economy for the centuries preceding us.  The only exception being the importation of spices and precious metals.

In his book ‘Recent World History’, Dietrich Schäfer, in agreement with every other historian, quite rightly says, “ The New World, which today is flooding the Old World with its products and threatens to kill off production in Europe, has nothing to offer its discoverers.  The animals it uses to create a large part of its wealth emanate from Europe.  Maize was the only indigenous type of cereal to America, which along with the potato were the only two crops that the New World could supply to the Old World.  It is well known that it took centuries until these crops grew in sufficient quantities to feed local populations.  Even the tropical and sub-tropical produce, which America sells today, were totally lacking in the first one hundred years after its discovery or were only available for export on too limited a basis to produce a profit.  Sugar cane brought over from Europe was first grown in Tahiti, but after the three centuries of Spanish ownership the yields still remained limited.  Europeans, we know discovered tobacco in America, but took time to develop a liking for it.  So there was absolutely nothing in the beginning that could be traded profitably or in sufficient quantities.  Emigrating to India was impossible, whereas to America it was possible on a limited basis.”

The exploitation of the overseas territories only actually happened in the last century and a half, made possible by European people and their inventions, which turned these territories in to an overseas Europe.  White people crossed the “pond” and were followed by machinery, the railways and other means of transport.  All European nations worked together in this task.  Germany, above all others, provided the New World with its organisers, soldiers and workers.  It was undoubtedly an impressive achievement within just a few generations to provide an entire new world with a new population, a new spirit, a new culture and civilisation.

We still believe that it was only in the 19th century that the overseas territories became truly significant for Europe.  What we must also accept is the fact that the achievements of Europe overseas were accompanied by its disintegration.

Three facts immediately stand out: the emergence of the global economy spelt the loss of Europe’s economic sovereignty; the amassing of huge colonial possessions led to the destruction of the Reich; and the success of the Anglo Saxon economic principles signified the end of the European economic community.  Three theses, then, that should be easy to demonstrate.

The Character of the Global Economy

I mentioned that Europe’s economic sovereignity was destroyed by the emergence of the global economy.  It cannot be denied that Europe lost all interest for its people in a very short space of time due to the wonderful opportunities overseas.  Even at the start of the 19th century, it was possible to transport the entire cotton crop of the USA on board one ship since the output was so small then.  More and more rapidly Europe’s food and raw material basis moved to the New World and to other continents, so that we soon became dependent on that which we used to make ourselves.  Suddenly our cereal and our cotton became America’s cereal and cotton and everyone said: “ What does America have to say?”  For thousands of years before, though, it had been very different!

This development would have posed no danger if the new global economy had represented something real, something lasting, that gave all European nations the same opportunities.  Not so, this one lived off the world power of England and turned the other European nations into provincial areas of the English Empire.  Today all this is evident to us, strange as this may sound, as we now recognise that the creation of a global economy can never be equated with the society of any nation.  The domestic, urban and social economies are all supported and formed by somebody.  Family, community, nation. As long as mankind, in the political sense, remains no more than a concept, the global economy will not become reality.  Instead it will remain dependent on political power for its foundation and order.  What the global economy means and how long it will survive depends on its creator.  We can see clearly that our efforts to establish labour division throughout the world have undermined our very own existence.

Political Weakness of Continental Europe
due to the Idea of
English World Superiority

The decisive point is that Europe’s loss of economic sovereignity entailed the loss of its political sovereignity.  At the time of the discoveries around the world, the political order of our continent began to decay.  The German Reich had provided this order for centuries, which had guaranteed its social, cultural and economic values.  As the Reich fell apart, the emphasis moved out to the nations on the edge of Europe - to Spain, France, Holland and finally to Great Britain.

What is really decisive, though, is that Great Britain believed that the only way to create and maintain order overseas was to render Europe politically weak.  The English Prime Minister, Salisbury, for example said in substantiation of the Balance of Power Principle In Europe, “We do not seek to divide territories, but to break down any dominant power.”

Mr. Eden echoed these words in November 1936: “The extent of the political empire’s responsibility in the world necessitates its close involvement in European affairs.  Through its free position, England has come to accept three main principles in its relationships with Europe.

1.	No power can be allowed to challenge its natural superiority in the North Sea and the English Channel.

2.	Small nations must never be allowed to fall into the hands of large powers.

3.	Large powers must not be allowed to gain superiority in continental Europe, as this would pose a threat to Great Britain.

Thus we see that England regarded European political weakness as a pre-requisite for its economic dominance and also that the question of Germany does not feature at all.  Expressed more succinctly, all of England’s global economic plans will endeavour to quash Europe’s attempt to regain its political and economic sovereignty with every means available.

Britain’s Dominant Theory about the Modern National Economy

Following on from the above two points there then came the infiltration of Europe by the Anglo-Saxon economic view, which disguised itself as the modern global economic theory and was thus widely observed.  It represented the following principles:

1.	Market forces determine everything that happens on earth.  Price is responsible for regulating economic affairs and decides the fate of nations and individuals.  It replaces the need for social ideals, moral ties and state requirements.

2.	The owner of capital is in control of economic goods, production and consumption.  Capital represents the commanding position in our economic life.

3.	International freedom of movement is the be all and end all.  Everyone should be able to settle where they see the best place for their commercial activity i.e. where there seem to be the cheaper production conditions and the lowest transport costs.

There is no doubt about the huge significance of these three principles.  The world has practically lived and breathed this view without looking at its foundation and detecting its side effects - until they were revealed to everyone by the great economic, political and spiritual crisis.  In my opinion, the English economy is determined totally by this prevailing Anglo-Saxon economic view, as England’s economic greatness ultimately relies on the belief of its people in the rightness and singularity of the British principles.  Thus, either consciously or unconsciously, England guided the economic development of all nations along it own lines.  Experts were dominated by this powerful theory.  The dominance of the London Stock Exchange and the hegemony of the English Pound were also the expression of England’s spiritual power, just as the old economic science of England was.  It is also true that even up to our time there was the belief that capital shaped the economy and that the theory of comparative costs was the pivotal instrument of global economic theory.

As a result, people failed to recognise what really shaped their lives; and that is people and room - not international markets.  What also happened was the automisation of Europe.  In a farming village it is taken as understood that everyone depends on each other and help each other, but in Europe each nation, each person’s job and each business lived just for its own interest.  Europe had become a geographic concept.

The Foundation of the European Economic Community

Now, though, Europe cannot exist purely as a geographical concept.  Instead, its foundation of existence lien in its political power and its consciousness of political unity.

I will totally ignore the fact that geographers cannot even define Europe properly.  Carl Ritter, the old expert on geography, concluded that Europe, as the ruler of the other continents, “could quite rightly provide the highest classification concerning the world’s historical and political condition, placing it into two main categories:

a)	the European world, to which even the europeanised one belonged.

b)	the non-European world, which was not advanced to the level of European civilisation.”

Regarding the question of the boundaries of the European continent he said, “ the eastern border has been decided by the development of history” and “ Europe’s natural border coincides with that of its people, its way of life and civilisation.”

Today our Leader himself has again pointed out that Europe has no geographic definition, just a national and cultural one.  To him, its borders are simply defined by the West’s history to date and he pointed to Europe historical emergence, which originated from that island in Greece, coming via the Roman Empire to the west.  To him, Europe was the area “of a family of people, amongst whom the political organisation and objectives might be quite divergent and different.  In blood and cultural terms, though, it represents overall a unity that is complementary to itself.”

From this realisation that Europe is not a geographical concept a number of conclusions have to be drawn, which are of crucial importance for the future economic and political co-operation of the people of Europe.

1.	Theoretically, concepts such as an enlarged area and its economy have to be rejected because they are vacuous and undefined.  Nothing is said about the area itself, other than it is of a particular size, one larger than has been generally the case.  We are not helped by the mere introduction of an unsubstantiated concept in economic arguments.

2.	The decisive things in the new unity of Europe are the type of co-operation and way of living within this unity.  Important political conclusions stem from this statement.  Firstly, that it is only possible for Europeans to live a European life if the struggle between nationalities of this area is limited to the spiritual sphere and nothing else.  Then there is the spiritual and political solidarity, even a community relating to the area which is the decisive feature of the new structure.  Finally, that the only aim of economic co-operation can be the European economic community.

3.	The decisive economic and political conclusion, therefore, is that Europe does not become, say, a so-called enlarged area in the sense of a smaller global economy pervaded by the old Anglo-Saxon economic laws.   Instead the European economic community has to be shaped according to new political categories, so it will look different to the economy of the past.

Categories within the European Economic Community

Europe, the geographical concept, is therefore in the process of making room for a political fact.  The decisive economic categories of this development will consist of replacing the individual with society, global market with living area (‘Lebensraum’), capital with organisation of the workplace.  The success of these three principles will herald an economic and political development of revolutionary magnitude.

Three Principles

Society Replaces the Individual

This means that an economy’s objective becomes totally different and the unbridled urge to earn money is no longer the regulator of the economy.  In its stead is the controlling authority of the community, which safeguards the tie between economy and society.  This must be kept separate from the organisational restrictions, otherwise damage will be caused.

Living Area Replaces the Global Market

To clearly differentiate between these two concepts, it is best to compare the views of their two great proponents: that of Adam Smith and Friedrich List.  According to Adam Smith’s theory of free trade through free competition each country produces those goods which it can produce best i.e. most cheaply.  Each country can then buy most efficiently and sell to best advantage.  Friedrich List, on the other hand, held that division of labour within nations, and not between nations, brought about the best performance. For him, an economy does not consist of mathematical values or exchange values; rather it grows from the availability and use of latent productive forces among the people and is synonymous with the awakening of all the productive forces of the nation.  The following table serves to show the two opposing economic views:

Adam Smith 
represents the market theory,
	Friedrich List 
represents the theory of productive forces,	
whose highest value is the value of the market or the exchange value,
	whose highest value is the productive force,	
international labour division is the route to wealth,
	confederation, i.e. the pooling of productive forces is the route to wealth	
the aim of Adam Smith and of free trade is harmony between all individuals,
	the aim of Friedrich List is the development of the energy of the people	
Adam Smith’s thinking is cosmopolitan,	Friedrich List’s and our thinking is political.	

There can be no doubt that the two economic views are theoretically and practically poles apart and that is why the outcome of the present struggle will be of utmost importance in economic and political terms for every European nation.

A note about the concept of living area itself, which I have briefly outlined as follows: to Germany, its living area is:

1.	A sufficient area for it to be able to live and grow in an enclosed settlement in Europe.

2.	The shift in focus of Germany’s economy to within its actual national area.

3.	The recognition of the development of a mainland European economic community, which allows the utilisation of its inherent economic forces, and ensures mutual supplementation through economic achievement between friendly neighbouring nations.

4.	The extension of a colonial economic area, such as is common and possible elsewhere in the world.

We see from this definition that living area is not identical to the area of the nation. We also see that the liberal view, which says that economic supply is totally independent of the politically governed area, is erroneous and can be rejected, in the same way as the mercantile view of the identity of the national and economic area is rejected.  This view of living area clearly establishes the economic relationship with the other nations of Europe, for if we demand living area for Germany, this also affirms living area for other foreign nations.  The aim of the theory of living areas is simply to form a new European order, which guarantees all nations its own living area.

Thinking in the Workplace Replaces the Theory of Capital

As I said before, here lies the Archimedes Principle, which gives us power to construct once again a new culture, a new economy on our continent. For ages, it has been recognised that work is the source of wealth, a fact only overshadowed in more recent generations by a fateful superstition that said that capital somehow had some determining influence on work.  From this was born the unhealthy consequence that a nation could have too many workers.  Only falteringly do people start to realise again that the limit of a nation’s wealth depends on its ability to organise its work.

It is obvious that these three principles, mentioned above, will have their practical effects.  I have to point once again to the example of the revival of the south-east European economies after 1933.  This shows how new methods used in these countries produced real indisputable successes.  You see, Germany did not suffocate its partners there with financial dependence, or make them financially indebted.  No monocultures were demanded or caused; prices were not held down.  Germany just bought goods, paid for them properly.  Germany released and developed the productive forces in these countries in the sense of Friedrich List.

A New Era

The final constitution of the European economic community could be something along the following lines:

First of all there will be a general change in ways of production through the utilisation of productive forces of the people.  What is produced will be determined by the energies of the nation and its area, not by the price that the world markets will pay.  One could perhaps say that freedom of work replaces freedom of the economy meaning that those national monocultures that are controlled by price would practically come to an end.  It cannot make sense to join all the European countries through a customs union just to build a smaller version of the English global economy full of the same mistakes.  Customs unions are a useful means of removing unnecessary difficulties between two national economies of the same level, if required. It would unnecessarily disturb and jeopardise the natural coalescence of the European economies if customs barriers were suddenly removed in Europe today.

On the other hand, the objective of future economic co-operation is to create a community of living space i.e. it cannot be, say, the task of the new economic policy to destroy monocultures and replace them with impossible insularities.  If the German Reich had pulled back the emphasis of its economy to its national area then that would send a strong message to the rest of Europe.  The small nations of Europe must never remain in any doubt that they too are dependent on their neighbours and must take them into consideration.  In 1932 Sering rightly pointed out that the strength of the American economy would break as soon as customs barriers went up on all of the 48 states’ borders, as in Europe.  Not only that, that the European nations would run the danger of being suppressed economically and losing their political independence if, one day, a new structural group came along and stopped the economic deterioration of the individual nations.

There will be two fundamentally new manifestations in this European economic community: full employment and self sufficiency in essential goods.  For me, there is no doubt that the experiences of the German people will lead them to teach other nations ways to achieve higher employment.  Nor do I doubt that the success of European tasks, which are determined by the exploitation of large parts of the continent, will call into play energies, which can be barely imagined today.  In doing so, as Bernhard Köhler once said in relation to the German people, the people of Europe will liberate themselves from proletarian restlessness and build a new life for themselves.  Equally important will be the requirement that essential goods must always be available if this requirement is adopted as a principle in people’s consciousness, and thus adopted into the practice of the economy.  The requirement is itself final, because what other meaning could the concept of living area have other than permanent access to essential goods! The development of all inherent economic forces of a nation and their supplementation by friendly neighbours are therefore the normal economic foundations and the necessary links in the security chain of a nation.

Clearly, these effects of the European economic community will herald a totally new era for Europe and the implementation of the new principles will have many obstacles to overcome.  The development of many processes of economic control and economic trade between nations shows the careful approach to solving problems that is necessary.  The difficulties in Europe are in peoples’ mind, not in the economic world.

Today it probably would not occur to anyone to take delivery of the earnings for a community and divide it up until that money is used.  It would all be worked out on paper and each person allotted his amount.  Even up to 100 years ago, for example, brick workers had their earnings distributed, where the ‘Meister’ used to take delivery all the money and place it in a pot before his colleagues.  Then he and the foremen would take what and this was kept separate from the amount in the ‘pot’.  Then, starting with the ‘Meister’, each worker would take their coin in turn.  The distribution of the small silver and copper coins continued until the money had finished.  The workers tended to watch the working out on paper with distrust, as it could be wrong.  However, there was no error in this method of calculation. Nowadays we tend to laugh at this method of payment, because it is different to what we are used to.  Our attitude towards many management related issues related is influenced by the same type of distrust, but eventually it will give way to a greater level of understanding.

Going back to the problem of clearing peaks, it is understandable that there are still those people who regard them with deep distrust.  They would prefer to be in the position of those brick workers, being paid bit by bit, whereas in reality the situation is clear:

1.	It goes without saying Germany is at the moment struggling to meet its contractual obligations in the way it did before, because it is striving to achieve a final victory.

Besides that it must be observed:

2.	Early on in the war Germany trusted its neighbours to deliver later.  Here the word is ‘trust’.

3.	Even longer ago, the individual nations were creditors to foreign countries, but with the difference that settlement was to be in gold and foreign currency.  

So basically nothing has changed except for the fact that today this type of settlement system would be extraordinarily difficult, because very few nations regard this method as acceptable and practical.  If gold and foreign currency were available then there would be no hesitation in entering these values in the balance sheet and to claim as cover for cash.  An agreement made in a treaty is today considered by individual partners as a risk or a burden because their expectations have already been dashed.

4.	This is the decisive point.  Today the German economy continues to supply incredible quantities of goods and its capacities still easily exceed the demands that are being placed on it.

The problem regarding clearing peaks that I mentioned basically relates to decisions to do with the new Europe.  The significance of the power of Germany’s economy sets the conditions for the game that has now started.  You see, management is all about balancing out, but you can only do that if you have the appropriate opportunities.  
Beyond that, the prerequisite for bringing about and developing the European economic community is making people familiar with the new world of ideas.

Taking a Look Back to the Past and to the Future

On our way to creating a community with living area we must not get diverted by the minor obstacles.  A quite unusual stage has been reached on our way to the new Europe.  Looking back we can clearly see as follows: we could recognise common European problems through our shared plight.  It started in November 1932 with the Europe Congress in Rome to discuss the subject “The European Crisis” and to review spiritual unity, economic domination and the continent’s cultural questions.  Then last year in the autumn the anti-Comintern Pact was formed in Berlin.  That is real progress in engendering the physical forces of Europe in the fight to maintain European culture!  For me there is no doubt that no nation in Europe can avoid the great question which is being fought over today.

More importantly though, our shared plight brought about spiritual and political movements of the same orientation throughout the diverse nations in Europe.  Almost simultaneously and independently of one another, men in all European nations rose up and formed groups, fronts and movements.  This was simply an expression of the time that had come.  They formed new ideas and, in the most important countries, gave the state a new face.  I deliberately refrain from citing examples.  Agreement is so profound that the one party system is the new political form that is right for Europe, in contrast to the multi-party one.  In the area of economic control such unity also prevails.  

In this time of disruption, difficulties and defence that we have to face it is only natural that we keep remembering our shared past.  Our common cultural basis will slowly grow into a European consciousness.

The decisively important thing that is going to happen on our way to a new future for our old continent is co-operation.  Prussia, and with it the Reich grew from the colonisation of all those of German origin.  I believe that nothing will promote and shape the European economic community more than future co-operation with the east European nations.

There is no doubt about the seriousness of the hour, nor the great opportunities that exist for the whole of Europe.  Today we are fighting for our very lives.  Much of what was created overseas by European people is now lost.  Fate has left us with home, family and work, which are now being defended in Europe by us.  It now depends on us whether we can once again build a new world and safeguard a new life and wealth for ourselves. Ahead of us the outlines of this new world can be made out.  Whether we build that land ourselves, or not, is up to us.  It depends on our will and how we develop and utilise our strength.

THE END OF HUNKE’S essay.

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