Austrian Economics and the Rise of Hitler

Ever wonder how one of the most educated and advanced nation in Europe ended up with Hitler as a leader in 1933? Well, you have thank Austrian Economics for that- at least partially.

You see, after ww1 the allies made Germans pay exorbitant and ruinous reparations. The only way to escape these compensations was through hyperinflation- wiemar style.

But here is the fun part.. after a few years of such hyperinflation they decided to cool down and “normalize” the economy- using the advice of people like Friedrich von Hayek and his “Austrian” School Of Economics. The guy who led this effort, Heinrich Brüning, whose austerity measures resulted in a massive increase in unemployment- from 15% to over 30% in less than two years.

By 1933 the average German had lost all faith in conventional political structures, parties, old school experts and gave an unconventional Austrian a chance at being Chancellor. We kinda know how that turned out, don’t we?

Let me pour some more gas on this: The Gold Standard and Zero Sum Behavior: 1

Comments?

  1. January 26, 2011 at 5:08 pm

    You’ve clearly never heard of Wilhelm Ropke.

    You are using a semi-retard to make the case that retards are not retarded.

  2. the dude
    January 26, 2011 at 11:30 pm

    lol. Completely wrong. There are problems with Austrians, but definitely not this example which is the result of hyperinflation

    • January 28, 2011 at 6:36 pm

      Lol. you’re flat out wrong, on this one.

      As Confucius said, “man who like edgy often fall off cliff.”

  3. Aaron
    January 27, 2011 at 6:12 am

    So they gave Hitler a chance or did he seize power illegaly? Books exist to be consulted.

    The rise of Nazis in 1930s Germany was linked to widespread unemployment from austerity-linked policies. Most people forget that they were a fringe group as late as the mid-1920s.

  4. Aaron
    January 27, 2011 at 10:47 am

    Well, that’s a considerable softening of your initial position. A portion of the German population, not the majority, responded to the widespread unemployment by losing faith in previous policies and choosing Hitler as a radical alternative. Hitler then went on to seize power through force and fraud. It was not, however, inevitable. Your other point, that Austrian economics caused the unemployment, seems doubtful to me, but I I am not qualified to comment on that.

    He was considered a fringe loony by Germans until their well-known statesmen failed them. His rapid rise to respectability is closely linked to the unemployment and poverty suffered by average Germans during the post-Wiemar austerity period.

    It was deflation plus unemployment that brought Hitler and Nazis to power, not inflation.

  5. the dude
    January 28, 2011 at 8:16 am

    Austerity was to counter the fallout from paper inflation, but too late by then, has nothing to do with Austrian policy, but with savings killed, basically a Zimbabwe. Cannot create value by printing, only redistribute.

  6. DoesNotMatter
    February 1, 2011 at 5:38 pm

    your. “Facts”. are. wrong. Idiot

  7. February 4, 2011 at 5:23 am

    Dude, Vox Day just took you behind the woodshed
    —-

    LIEbertarians and “austrian schoolers” are like the autistic kid in class.. nobody cares.

  8. tdm
    February 4, 2011 at 6:02 am

    If you want to lead others you must first put on some clothes.

    Austrian school supporters have to get a clue about running societies.

  9. February 4, 2011 at 6:22 am

    What happened – did you read the word “austerity” and think that the Austrians must have had something to do with it because they both begin with “AU”? Do you have a source stating that Bruning was following the advice of Austrian School advocates?

    Bruning was influenced by the classical London school of eCONomics, which was incidentally also a starting point for Austrian eCONomic thinking.

    Why did his tenures as chancellor see such a huge increase in unemployment? Cutbacks to public spending?

    Repackaging the gold standard in better sophistry is not an achievement.

  10. Da Man
    February 4, 2011 at 8:30 am

    If this clown fancies himself a devil’s advocate, Satan desperately needs new people.
    —-

    If you believe in satan, you require a new brain.

  11. A. Nonny.mous
    May 3, 2011 at 5:50 am

    AD, answer unclesol. He is asking you a very basic foundational question critical to your argument. Do you have a source stating that Bruning was following the advice of Austrian School advocates?

    LIEbertarians are either aspergy scumbags or disingenuous fuckers who deserved to be tortured and killed.

    I have no wish to justify myself to such subhumans.

    Saying he was “influenced” by the “London School of Economics” is weak sauce on 3 counts. 1) Germany had its own schools and 2) LSE during that time period had a much more anti-Austrian at its base. It wasn’t till Hayek fled the Nazis—i.e. AFTER the German economy fell apart and Hitler rose (Hayek was a Jew)–that LSE had anyone resembling Austrianism teaching there; and 3) is no proof at all, just assertion.

    See above..

    In fact, Hayek was horrified when he got to LSE, because the exact same social and economic theories that had brought German to its knees were being repackaged there—and were the opposite of Hayek’s teachings. In other words, German economic thought and LSE were anti-Austrian at the time period you’re talking about.

    It was such social and economic folly, btw, that lead Hayek to write The Road to Serfdom. He saw that the mania for “planning” and greater governmental control over the economies was widespread and he wanted to respond to them en masse.

    And Da Man isn’t claiming a belief in Satan; he’s making a pun on your name.

    The only good LIEbertarian is a dead LIEbertarian.

  12. July 6, 2013 at 5:03 am

    Why is the austerity to blame for the rise of Hitler and not the hyperinflation that made the austerity necessary? Uh, you think hyperinflation just might have contributed to the loss of faith in conventional political structures? Ever lived in country with hyperinflation?

  13. The Plague Doctor
    July 7, 2013 at 12:33 pm

    LOL, I can’t believe that Advocrapanus does not see the supreme irony of this post:

    – Most Austrian School economists are/were Jewish (Ludwig von Mises, Murray Rothbard, Israel Kirzner, Ludwig Lachman, Karl Schlesinger, Walter Block, and many others, though Hayek apparently wasn’t).
    – Advocrapanus believes the Jewish bankers, errr. . . I mean the “Austrian School” was responsible for prewar Germany’s dismal economic conditions. . .
    – His proposed solution is to “torture and kill“. . . all “subhuman” Jews, errr. . . I mean “libertarians”. . .

  14. P Ray
    June 16, 2019 at 10:47 am

    Somewhat related:

    I haven’t checked out the maths myself, but I like the picture for Elmo.

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