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Post Economy of Nazi Germany
Created by John Eipper on 07/20/17 4:56 AM

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Economy of Nazi Germany (Eugenio Battaglia, Italy, 07/20/17 4:56 am)

In his excellent and provocative post of July 16th, Luciano Dondero asked: "Nazi Germany, FDR's USA, militaristic Japan--were they all 'capitalist' regimes?"

I am not versed enough in economics to participate in a learned discussion here; however I have some observations:

Nazi Germany was not a capitalist regime, but rather an example of national (not Marxist) socialism (we may add the Fascist Socializzazione) which.may economically triumph even against considerable obstacles.

Hitler came to power in 1933, finding more than 6 million, over 30%, of the German work force unemployed, but in 1937 he opened the doors to immigration because there were no more available German workers.

Some Italians, attracted by the favorable working conditions, high wages and social benefits, went to Germany. When Mussolini visited Germany and was presented with huge Nazi parades, the Italians joined the parade with their black shirts for a special homage to Il Duce. Apparently the Nazi high brass was not very enthusiastic.

Among the volunteer immigrants was a neighour living in the apartment just below mine. He went to Germany very proudly with his black shirt, but after the end of the war he returned and claimed that he was a victim of deportation. He was one of many who made this claim.

Hitler created a National Central Bank instead of the usual Central Bank owned by other private banks. This Bank did not exchange marks for gold but in exchange for work. Furthermore the commercial exchange was not priced in gold (pounds or dollars) through the various usurious banks, but through direct exchange of products, therefore there was no debt and no deficit.

The controversial (well anyone that is not, a priori, claiming to be a follower of the new Western religion on the devil Hitler is controversial or unreliable; of course I am a believer) Henry Makow wrote, "This was the main reason why Hitler should have been stopped." The British economist Henry C.K. Liu wrote: "Through a policy of independent sovereign monetary policy and a program of public works which granted full occupation the Third Reich transformed a bankrupt Germany into the strongest economy in Europe, in only four years prior to starting the expenses of armament."

Another controversial historian, Mark Weber, in his Historia y Cultura del III Reich...


...has written an interesting and very detailed review on the subject.

The conditions of the German workers and of the average citizen following the example of Fascist Italy were extremely good, with high wages and considerable fringe benefits for families, children, having great open museums, concerts, sponsored vacations, even cruises on special workers' vessels, medical assistance for all, etc.

David Lloyd George, after visiting Germany in 1936, wrote a long article of praise, closing it with the following: "Yes, Heil Hitler, I myself say that, because for truth he is a great man."

The late historian John Toland rightly wrote: "If Hitler had died in 1937, without any doubt he would be considered one of the greatest men of German history."

JE comments: If only Hitler had died in 1937.  Then we'd have had the chance to test Toland's hypothesis.  As for Mark Weber, he certainly is controversial:  Weber is (or was) an outspoken Holocaust denier, although paradoxically, he later would "deny" Holocaust denial, which made him a pariah even among fellow deniers.  (This per Wikipedia.)

I always understood that Hitler just put Germany's unemployed in the army. This is an oversimplification, but some years back WAIS addressed the topic of the so-called Nazi economic recovery. It's complicated, and more nuanced studies suggest that the Nazi economy was not as healthy as apologists claim. One scholar goes so far as to argue that Germans were gradually starving under Hitler (pre-1939), and were materially worse off than during the desperate 1920s and early '30s. Cameron Sawyer's discussion from 2010 gives a good overview:


Toland's Hitler biography was not without critics.  See this review:


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  • If Hitler Had Died in 1937... (Carmen Negrin, -France 07/20/17 2:11 PM)
    In response to Eugenio Battaglia (20 July), it would have been even better if Hitler had died in 1936 before invading Spain with Mussolini! My family would still be in Spain, all the intelligentsia that benefited Mexico and other Latin American countries would have also stayed and helped their own country develop.

    Maybe Eugenio can tell us about this new law being discussed in Italy about forbidding and reprimanding any praise to Mussolini including on Internet.

    JE comments: I'm especially interested in Eugenio's response to the second paragraph. WAIS has repeatedly published Mussolini praise from Eugenio. As editor, might I someday face prosecution in Italy? Note the disclaimer appended to every WAIS post:

    The views expressed in this posting are of the author only and may not necessarily reflect the official viewpoint of the WAIS organization.

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    • Anti-Mussolini Laws in Italy (Eugenio Battaglia, Italy 07/22/17 8:46 AM)
      Commenting on Carmen Negrín's post of July 20th, our esteemed moderator asked me: As editor, might I someday face prosecution in Italy for having published Eugenio Battaglia's praises of Mussolini?

      I would say "NO," and that the disclaimer should be enough defense.

      After all I am not praising Mussolini per se in my posts.  I am relating actual facts.

      For instance, it is a fact if I write about the earthquake of 23 July 1930 in Irpinia, magnitude 6.7 with 1404 deaths.  The reconstruction went very well, including a savings of 500,000 lire from the original budget with the delivery of the new houses on 28 October 1930, 3746 brand new and 5190 repaired.  Contrast this with the earthquake in central Italy on 23 August 2016. Little rebuilding has been done until the present. Just yesterday the Mayor of Amatrice was on television asking at least for the removal of rubble from the streets. In citing the above there are no exclamations of Viva il Duce, maybe only a denunciation of the present government's incompetence. Admittedly, the locations of new housing in Amatrice have been identified and a provisional building for four restaurants should be ready within days, although the mayor is still working out of a container. The inhabitants, unfortunately, are still scattered around without rebuilt housing.

      The first statute against Fascism is in Italy's unconditional surrender of 1943. It was then confirmed by the article 17 of the Peace Treaty (Diktat).  The previous article 16 prohibits acting against those who from 10 June 1940 until 8 September 1943 showed "liking" (treason) favorable to the Allies.

      The Italian Constitution of 1948 has a "transitional disposition" Article 12, against Fascism.  Two other laws followed: Scelba 1952 and Mancino 1993.

      The present uproar about Mussolini started at a beach in Venice, extremely popular and well run, which had some photos of Mussolini on display. Furthermore, the Left is presently in political trouble and when the Reds are in these conditions their only hope to distract the public is a good revival of antifascism, even if Mussolini died 72 years ago and with him Fascism came to an end.

      The most ridiculous proposals are appearing, such as destroying buildings built during Fascism, checking all emails or jailing a guy who places democracy in jeopardy by lighting up a cigarette with Mussolini-themed lighter.

      By the way, up to now the "saluto romano" was not considered a crime if made in a cemetery during the commemoration of a fallen person, even if he was a fascist, but it may be considered a crime if done in other circumstances.

      To conclude, I do not believe that there will be enough time to pass the new law in the two Parliamentary chambers prior to next spring's elections. Nor does it look like the numbers are in favour

      That is all for now from Italy--lay, democratic and antifascist born from the resistance and formed by the constitution.

      JE comments:  Have there been any convictions under the existing anti-Mussolini laws, say in the last 25 years?

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      • Prosecutions of Mussolini Apologists in Italy (Eugenio Battaglia, Italy 07/23/17 5:12 AM)
        Regarding prosecutions in Italy for pro-Mussolini or Fascist views, there have been several cases of convictions and the dissolution of some small political groups.

        In Milan in 2015, 16 members of Casa Pound honoring Sergio Ramelli and Enrico Pedenovi (both young MSI members killed by the Reds in the 1970s) and Carlo Borsani (a gold medal recipient blinded in a war injury and killed by the partisans in 1945) were sentenced to one month in jail and a 250-euro fine in favor of ANPI (Associazione Nazionali Partigiani Italiani--communists) for giving the "saluto Romano" and other "fascist" gestures.

        The mayor and his aldermen of the town of Affile are presently facing prosecution with a possible sentence of two years' imprisonment for having allowed the construction of a "mausoleum" (large tomb) dedicated to Marechal Graziani.

        In Bolzano in 2010, the local leader of Casa Pound (the best-known group, inspired by the social doctrine of the great poet Ezra Pound) attended a hockey match wearing a shirt with a photo of Mussolini. For that he was sentenced to two months in jail.

        Note: generally, for sentences of three years or less, nobody in Italy really goes to jail. Rather, incarceration is substituted by some alternative punishment.

        Anyway do not worry.  The Italian government ensures that Italy remains a good colony of the Empire, ready to supply cannon fodder for its various wars and to support any self-defeating sanction. But overall it is extremely ready to fight Fascism even it is a Saluto romano or a photo of Mussolini hidden in a closet.

        JE comments:  These prosecutions seem to be of a symbolic nature, which begs the question:  doesn't all this attention actually motivate the Mussolini apologists?

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        • What is Meant by "Reds"? (Carmen Negrin, -France 07/23/17 3:13 PM)
          I wonder what Eugenio Battaglia (July 23rd) refers to when he says "the Reds." I don't know of any party of that name.

          JE comments: I believe Eugenio meant the Red Brigades (Brigate Rosse), who were at war with the neo-fascist MSI (among others) in the 1970s.  Carmen Negrín's question does raise a question in my mind:  have any leftist political groups self-identified as "Reds" since the demise of Italy's Brigate?

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          • Who are the Reds? (Roy Domenico, USA 07/24/17 10:17 AM)
            Regarding the question of "who were the reds," I think that Carmen Negrín (23 July) was pulling our legs a bit.

            The Reds are communists--I would think that's obvious. The two neo-Fascists mentioned by Eugenio Battaglia may have been killed by the Red Brigades; but the Red Brigades positioned themselves against the Italian Communist Party (PCI) which, they felt, had betrayed the cause by dealing with the Christian Democrats.

            Look at the flag of the Soviet Union. Look at China's flag today. Its message is that "the East is Red."

            JE comments:  Flag below.  In the generation since the fall of the USSR, "red" has lost its original bogeyman meaning, at least in the US.  The Red States are now as red-blooded as, well, red meat.  When my classes start in a month, I will quiz my students:  what does the expression "Better dead than red" mean to you?  I'll be sure to report back.

            I've also heard (again) from both Carmen Negrín and Eugenio Battaglia.  Stand by.

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            • Reds and Red States (Timothy Brown, USA 07/25/17 6:21 AM)
              I beg to quibble with Roy Domenico (July 24th).

              Unlike all the rest of the world, in today's United States the color of the right-of-center Republican Party conservatives is flaming red, while, again, unlike the rest of the world, the color of the left-of-center Democratic party is delightfully blue.

              My professor of Political Psychology (my primary PhD) would have labeled this a major propaganda coup by the left. But, then, before she left Moscow State University where she'd taught during the Cold War, she'd been unusually well versed on how one subtly manipulates public opinion.

              In short--sorry Roy--in the United States it's no longer obvious that "The Reds are communists."

              Here it's the far-left faction of the Democrats who are cheerfully Blue.

              JE comments: I tried to make this same point when commenting on Roy's post. 

              Some years ago we attached a date on the "Red State/Blue State" division. The original culprits were the TV networks, who needed a way to mark the states on the electoral map. In the early days of color TV, the Democrats were predictably red. Was it the "liberal media" that staged the coup of turning them blue?

              According to this 2012 Smithsonian article, the color shift happened in very recent times:  the Election-without-End of 2000.


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              • Reds, Red States, and Blue States (Roy Domenico, USA 07/26/17 4:27 AM)
                I just finished sending my last post--which was something of a question--and I read Timothy Brown's response (July 24 and 25).

                I'm not sure if we disagree on that much. I get Tim's point that the Republicans are red now and I expect he's right with the under thirty (or forty?) crowd who never experienced the "old" notion that the reds are communists (at least old in America's case--identification of with the far left is still the norm for most of the world). But this still bugs me and says something about the declining place of history and heritage. My concept of red drew from more than a century-old self-identity. The far left (mainly communists) were red and proud of it--and this heritage can still be seen in the flags we've mentioned. The current American connection between red and Republican is apparently based on some media decision--either by a political operative or someone simply ignorant of the tradition (or maybe both).

                Deep down inside, I've never been comfortable with the idea of painting the US Republican Party red and the Democrats blue. JE triggered this in me with his statement that it happened in the 2000 election. I don't doubt that--but why? Somebody somewhere--I expect some functionary at a TV network--made some bizarre decision to use red as the conservative color. Was there ever an explanation?

                JE comments: Could the decision have been purely esthetic? The South votes Republican, and blue, like the sky, looks better when it's on the top. Also, the Coasts are Democratic, and can be blue like the oceans.

                It's just a theory.  Perhaps a lame one.  I was reading House Beautiful last night.

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                • "Red Century": New York Times (Luciano Dondero, Italy 07/28/17 2:11 AM)
                  I surely bow to our American colleagues when they describe how "red" is now getting a new spin in US politics.

                  However, I think this series in the New York Times might be helpful to keep a sense of historical/world balance:


                  JE comments:  An excellent recommendation, Luciano, for this centennial year of the Russian Revolution(s).  There are several articles in the series I'm looking forward to reading, beginning with the discussions of whether Lenin was a German agent (and funded no less by German condoms--most intriguing).

                  Imagine an alternate universe in which the USSR still exists.  This would be one helluva year of centennial pageantry.

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                • Reds and Red States (Robert Whealey, USA 07/28/17 5:14 AM)
                  I agree that Republican-leaning states should be called by their true name, and not by the color Red. The traditional Democratic states should be called by their traditional leanings, not Blue.

                  The United States, Great Britain, the French Republic from 1789 and the brief Provisional Government in February 1917 in Russia, used the red, white and blue. If you turn the Russian flag upside down, it would become the Dutch Tricolor.

                  An all-red flag was used briefly during the French Revolution by Danton. The red flag was born again in the 1905 Russian Revolution and with Lenin in November 1917.

                  Red became a symbol of contempt in the United States from 1917 to 1991. That red flag became a symbol for dogmatic, ideological propaganda against Communism. TV once again would like to sow confusion in the United States, with voters 18 and below, who have never read a single history book. The intelligence agencies would rather hire English majors than History majors in federal government. Historians and philosophers, who are looking for the truth, ask too many embarrassing questions, in my opinion.

                  JE comments:  Don't the intelligence agencies prefer technocrats, STEM types?  In any case, English majors are trained to think critically, just like philosophers and historians.

                  In this discussion we've done justice to the politics of red.  Shall we lighten things up a bit?  How about the "Pinkos"?

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                  • Reds and Rojos, Republicans and Republicanos (Enrique Torner, USA 07/29/17 8:56 AM)
                    The names and colors of the US political parties are extremely confusing, especially to Spaniards. I always have had a very difficult time trying to explain to my family in Spain that American Republicans are the complete opposite of Spanish "republicanos," also called "rojos" (reds). So, when, after the 2016 American election, Spaniards saw the electoral map, many of them thought that the "communist" party had won by a lot, because they saw so much red on the map! The added complication is the American electoral system, which is incomprehensible from the point of view of the common Spanish citizen.

                    Reversely, when I teach the Spanish Civil War in my university classes, my American students tend to identify "republicanos" with Republicans, and think that they are conservative! I believe French and Italians have the same problem, right? What other countries have it?

                    JE comments:  Same in my classes.  US students have a very hard time with the basic premise of the SCW, because the Republicanos were on the left side of the spectrum.  Even more confusing for them is the notion that the rebellious side was on the right.  Aren't "revolutions" always the handiwork of the Commies?

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                  • Russian Flag and Dutch Flag (Rodolfo Neirotti, USA 07/30/17 7:31 AM)

                    Robert Whealey wrote on July 28th: "If you turn the Russian flag upside down, it would become the Dutch Tricolor."

                    Please see both flags below, showing that this is not the case.

                    JE comments:  Absolutely true, but several accounts of the origin of the (Tsarist) Russian standard in 1696 establish a connection to the Netherlands.  Peter the Great was an admirer of Dutch shipbuilding prowess, and apparently the Russian flag was inspired by Dutch ships calling on the port of Arkhangelsk.  See below:


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            • Singing "The Red Flag" (John Heelan, -UK 07/25/17 6:44 AM)
              One also remembers the lyrics of "The Red Flag" (1889):

              The people's flag is deepest red,

              It shrouded oft our martyred dead,

              And ere their limbs grew stiff and cold,

              Their hearts' blood dyed its ev'ry fold.

              Then raise the scarlet standard high.

              Within its shade we'll live and die,

              Though cowards flinch and traitors sneer,

              We'll keep the red flag flying here.

              Look 'round, the Frenchman loves its blaze,

              The sturdy German chants its praise,

              In Moscow's vaults its hymns are sung

              Chicago swells the surging throng.

              Then raise the scarlet standard high.

              Within its shade we'll live and die,

              Though cowards flinch and traitors sneer,

              We'll keep the red flag flying here.

              It waved above our infant might,

              When all ahead seemed dark as night;

              It witnessed many a deed and vow,

              We must not change its colour now.

              Then raise the scarlet standard high.

              Within its shade we'll live and die,

              Though cowards flinch and traitors sneer,

              We'll keep the red flag flying here.

              It well recalls the triumphs past,

              It gives the hope of peace at last;

              The banner bright, the symbol plain,

              Of human right and human gain.

              Then raise the scarlet standard high.

              Within its shade we'll live and die,

              Though cowards flinch and traitors sneer,

              We'll keep the red flag flying here.

              It suits today the weak and base,

              Whose minds are fixed on pelf and place

              To cringe before the rich man's frown,

              And haul the sacred emblem down.

              Then raise the scarlet standard high.

              Within its shade we'll live and die,

              Though cowards flinch and traitors sneer,

              We'll keep the red flag flying here.

              With heads uncovered swear we all

              To bear it onward till we fall;

              Come dungeons dark or gallows grim,

              This song shall be our parting hymn.

              Then raise the scarlet standard high.

              Within its shade we'll live and die,

              Though cowards flinch and traitors sneer,

              We'll keep the red flag flying here.

              It's always amusing to watch the last act of the Labour Conference each year when the Party leaders all link arms on the conference stage to sing the "Red Flag."  It's a pity that some cannot remember the words and are clearly just moving their mouth!  The other interesting thing is that the "Red Flag" is sung to the tune of a German Christmas hymn, "O Tannenbaum! Oh Tannenbaum."

              However I prefer the rude parody that states:

              The working class can kiss my arse

              I got the foreman's job at last.

              You can tell old Joe I'm off the dole

              He can stick his Red Flag up his 'ole!

              JE comments:  "We must not change its color now."  As we saw earlier today, in 2000, American political pundits did just that.

              Here's a vocabulary quiz:  How many of you know what "pelf" is?  I had to look it up.

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          • Who Are (Were) the Reds? (Carmen Negrin, -France 07/24/17 10:38 AM)
            To answer John E, "Red" is the term used by the Francoists to anyone who wasn't Francoist, not a very precise terminology. That's why I was wondering what Eugenio Battaglia meant.

            JE comments: Rojo, bolchevique, judío, masón:  the Francoists didn't sweat the semantic nuances.  As Eugenio Battaglia (next) will explain, he was using "red" in the all-inclusive red-bashing sense.  A question for Eugenio:  were Jew, Mason, Bolshevik, etc., also used as "othering" epithets in Mussolini's Italy?

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          • The Reds Then and Now (Eugenio Battaglia, Italy 07/24/17 10:48 AM)
            In response to Carmen Negrín (23 July), I was referring to the Red Brigades, but not only them. Carmen with the Spanish Civil War should know who the "Reds" are.

            JE comments: Surprisingly, Carmen and Eugenio are in agreement here...

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            • Le Pen, and a Conversation in a Taxi (Carmen Negrin, -France 07/25/17 10:02 AM)
              With his reference to the "Reds," I understood who Eugenio Battaglia would be referring to in Spain, but I wasn't totally sure who he was referring to in Italy. But yes, it is true that I was pulling his leg!

              In any case, of course this terminology, which puts everyone in the same bucket, is very practical for certain purposes, but not very precise or correct. I would consider myself (outside the US) as pink, but I guess these many colors take too much time to explain, especially in a nationalistic environment.

              By the way, and this should make Eugenio happy, I took a taxi today and mentioned the fact that if Le Pen had won the elections I would have left France.  He asked me why. My answer, almost apolitical (except in the US), was:  "Because I am a democrat."

              So he started giving me a history lesson about how all the wars had been initiated by democrats, WWI, WWII, all the 19th-century ones. I thought it was quite interesting to hear how history can be reinterpreted according to one's ideals, in this case Le Pen's and how these ideas have spread again and become banalized, and finally, how memory needs to be constantly refreshed.

              Sorry to say but he didn't get a tip!

              JE comments:  France must be like Latin America, inasmuch as you can always count on a spirited political discussion from taxistas.  But Carmen:  was your taxi driver talking about "small-d" democrats, or the capital-D party in the United States?  If the former, blaming them for the World Wars is folly.  It is true that the US had a Democratic president when it entered most of its wars:  WWI, WWII, Korea, and Vietnam.

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  • Economy of Nazi Germany (Tor Guimaraes, USA 07/20/17 2:24 PM)

    Eugenio Battaglia (20 July) stated, "Nazi Germany was not a capitalist regime, but rather an example of national (not Marxist) socialism." 

    Nazi Germany was a hybrid system, a one-party socialist dictatorship with some major private capitalist entities (companies).

    No one can deny that compared to the situation after WWI, the Nazis after the early ideological cleansing which was pretty ugly, took much better care of German working class. In my opinion, once the shooting for WWII started, German social economics started to deteriorate and measurement of productivity became exceedingly difficult due to military conscription (more untrained women to the production lines) and widespread slave labor. Also, stolen raw materials must have been helpful, but war activity took a heavy toll.

    One of the most impressive performances from Nazi Germany, and to a lesser extent Tojo's Japan, were some of the advanced weapons systems developed under fire: jet fighter, new tanks, V1 and V2 rockets, new submarines. If the jet, the V2 and the new submarines had been more fully deployed, we might all be speaking German today despite Hitler's strategic stupidity invading Poland and starting WWII prematurely, Barbarossa, declaring war on the US, etc.

    Further, thank God Hitler's megalomania wasted huge amounts of German energy and raw materials (labor, cement, steel, etc.) in the Channel Islands, the Siegfried Line, the huge battleships, etc.

    JE comments:  I'm still curious about Nazi Germany's central bank.  How exactly did its currency work?  Was the Reichsmark ever a convertible currency?

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  • Eric Kurlander, "Hitler's Monsters" (John Heelan, -UK 07/21/17 4:18 AM)

    In response to Eugenio Battaglia (20 July), by coincidence I am currently reading Hitler's Monsters by Eric Kurlander (Yale UP, 2017), which claims to be "The definitive history of the supernatural in Nazi Germany, exploring the occult ideas, esoteric sciences and pagan religions touted by the Third Reich in service of power."

    From the base ideas of Madame Blavatsky's Theosophy, Kurlander traces step-by-step how the ideas of what he terms "the supernatural imaginary" of the occult, supported by Hess, Hitler, Himmler, Goebbels, Rohm and others, became the basis of the "religion" fundamental to National Socialism that was aimed at the destruction of European Judaism and reached its pinnacle in the Wannsee Conference.

    JE comments:  Helena Blavatsky's theosophy been cited as one of the underpinnings of modern anti-Semitism.  I presume this is one of the central arguments of Kurlander's book.  Professor Hilton was familiar with Blavatsky's writings, but did not go into detail:


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  • Lloyd George's Visit to Hitler, 1936 (Robert Whealey, USA 07/21/17 4:43 AM)
    I would like to see an endnote for the 1936 visit, when David Lloyd George said "Heil Hitler."  (See Eugenio Battaglia, 20 July.)  I read David Lloyd George's report to the FO. He did praise Hitler in a somewhat humorous way. But I don't recall any slogan such as Heil Hitler.

    JE comments:  Google "Lloyd George praises Hitler" and you get a minefield of apologist websites.  It's hard to separate the wheat from the chaff (more precisely, manure).  Did LG ever say "Heil Hitler" in earnest?  We do know he came back from the 1936 encounter glowing with Fuhrer enthusiasm.  In an essay he called Hitler "Germany's George Washington."

    Remember the British Tommies' classic ditty, "Lloyd George Knew my Father, Father knew Lloyd George," sung to the tune of "Onward Christian Soldiers"?  Some say it referred to LG's reputation as a womanizer.

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    • Was Lloyd George an Appeaser in 1936? (Robert Whealey, USA 07/23/17 4:53 AM)
      Lloyd George in 1936 indeed was an appeaser, certainly different than he had been in 1916 to 1922.

      The purpose of LG's 1936 trip was to tell Hitler that Great Britain was not going to return former German colonies to the Third Reich.

      JE comments:  I hope Robert Whealey will follow up on this.  Did Hitler ever ask for Great Britain to return its colonies--presumably, the ones in Africa it lost after WWI?  I don't recall ever reading about this, even in A. J. P. Taylor's arguably revisionist The Origins of the Second World War.

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