GERMANY: Bathtubs v. Taxes

Dr. Walther Funk has been much laughed about in Germany as Economics Minister, much loved as a man. Germans call him “gentlest of all the Nazis,” and consider him eminently tolerant, fairminded, honest. Short, fat as Santa Claus, just turning 50, he is the funniest after-dinner speaker in Berlin, and about the only Nazi bigwig who will give foreign newspapermen a straight answer.

But the great economic theories which, in his years as a financial journalist, Walther Funk made plausible at least to Germans, have in recent months been openly and flatly called harebrained. One National Socialist panacea followed another until it was recently rumored in Berlin that a Chinese economist named What Now was being brought in to clear up the Funk mess. Yet last week, Minister Funk was praised in no less a German economic journal than the semi-official Vierjahres-plan—for “an organization achievement of the greatest dimensions.” The achievement: devising a General Economic Council which, in effect, kicked himself out as Germany’s No. 1 Government economist, and put Field Marshal Hermann Göring in. Effusiveness of the praise which was given Herr Funk made it look suspiciously as if he was being eased out, and given credit as a face-saver.

Herr Funk, always known as a Göring henchman, had by this shift given his portly hero more administrative titles and more actual power than any other man in Germany, including Adolf Hitler. Hermann Göring is now President of the General Economic Council, Chief of the National Defense Council, Administrator of the Four-Year Plan, Air Minister, Supreme Commander of the Air Force, Prime Minister of Prussia, President of the Reichstag, Reich Hunting Master, Reich Fishing Master. Walther Funk retained his posts as Economics Minister and Reichsbank President, but his jurisdictions were cut, his staff reduced, and final authority transferred to Herr Göring.

One vivid fact stood out when the personnel of Economist Göring’s Council was announced last week: Five of twelve members were long-standing civil service experts who are relative newcomers to the Nazi Party. Inference of the shift of authority was that under the stress of the Allied blockade, and in the face of disappointment over Russia’s power to help, German economy has had to bolster inflationary, promissory, “Socialist” schemes with more oldfashioned, penny-bank economics.

In a swan-song speech in Salzburg, Herr Funk bore this inference out: “The National Socialist Government declines to cover war costs by means of the printing press.” He urged rather popular savings, not of Sachwerte (real wealth) but of marks and pfennigs. “Some people are hoarding even bathtubs, although they can neither eat them, wear them around their necks, nor pay taxes with them.” Why Herr Funk put taxes in a class with food and adornment, as something every good German should enjoy, was made clear by his hints that the Government might soon have to levy some new taxes. Best way to make people save is to tax the things they would buy if they did not save. After Herr Funk’s speech, it was rumored that a sales tax of 40% would be applied on all goods not on ration lists.