Limits on armaments production in Nazi Germany were initially political, with the regime explicitly refusing to mobilize the economy too deeply. The Nazis endeavored to prevent a repetition of the experience of World War I, when Imperial Germany suffered political unrest and eventual revolution trying to wage total war. Given Germany's weaker economic position and resources vis-à-vis its opponents, Adolf Hitler deliberately planned to avoid a long war of industrial attrition. Instead, he planned to wage short, intense campaigns with the limited military forces under development since 1936. Hitler's guiding strategic concept was to defeat his enemies quickly and avoid military stalemate on the battlefield. The Italian and Japanese war efforts took a similar approach, mainly owing to their inability to compete with Britain and the United States in war production. Indeed, the small size of the Japanese and Italian economies and the drain on Japan of the Sino-Japanese War precluded a major mobilization effort in any case.
The initial Axis strategies called for a high initial investment in modern military equipment; a readiness to conduct short, opportunistic campaigns; and the careful avoidance of long-term economic mobilization. Unfortunately for the Axis powers, the course of the war quickly rendered these plans obsolete.
The western Allied strategic synthesis was also based on the wartime experience of 1914–1918, although different lessons were drawn from that Pyrrhic victory. Although the war itself was viewed as a political and economic disaster, the concept of mass industrial mobilization was taken for granted. By investing in technologically intensive and financially costly—but manpower-saving—armament programs, the western democracies hoped to avoid the mass bloodletting of World War I. Future wars, their leaders believed, would be won by industrial might invested in such programs as the Maginot Line or four-engine bombers, not by running infantry against enemy trench lines. In contrast to the Axis strategy, the Allied strategy was slow to develop, as it took time to gather resources and mobilize industry for war.
As with the western democracies, the Soviet Union also intended to wage machine war on a grand scale, although with a significantly heavier reliance on manpower. Formed out of the experience of the 1919–1920 Russian Civil War, Soviet strategic thinking planned on mass warfare in part because party leaders saw no separation of war, politics, and society. In addition, the policy took advantage of the great resource and manpower reserves available in the Soviet Union. Despite the extreme social and economic disruption caused by industrial and agricultural five-year plans in the 1930s, the experienced and hardened Soviet bureaucracy was confident of a massive industrial response to any future conflict.
Viewed in these terms, there were four main centers of armaments production during World War II: the western democracies (after 1940, only the United States and British Commonwealth), the European Axis (Germany and Italy), the Soviet Union, and Japan. These economic spheres were in no way equal, however; the Axis powers were at a severe disadvantage. In 1938, for example, the Allied gross domestic product (GDP) was 2.4 times the size of the GDPs of Axis nations. This ratio is meaningless, however, if such economic power is not translated into combat-ready munitions.
In 1939–1941, the Axis nations enjoyed a significant armaments advantage, as their rearmament programs had started earlier and had concentrated on frontline aircraft, vehicles, and other equipment. In contrast, the western democracies and the Soviet Union were still heavily engaged in long-range rearmament programs at the outbreak of war. The British and the French were building aircraft factories and capital ships in 1940, for example, while the Russians were still focused on engineering, machine tools, and factory construction. Before the fall of France in June 1940, U.S. armament expenditure was quite low, and the munitions industry was backlogged with European orders for machine tools and aircraft. From an armament perspective, the Allies were trailing behind the Axis in the production of actual combat power despite economic superiority, which partly explains the military success of the German and Japanese offensives through 1941. Allied fortunes were then at a low point as entire countries and colonies fell under Axis control, and the Allied GDP ratio over the Axis fell to 2:1 at the end of the year.
From 1942 on, however, the ratio moved steadily against the Axis powers, particularly as the Allies began coordinating armaments production on a massive scale. During 1942, the United States, Britain, and Canada agreed to pool their resources and allocate the production of munitions on a combined basis. The governing idea was to take advantage of each nation's manufacturing potential, covering any shortfall in other areas through imports from other Allied countries. The British, for example, dedicated a higher proportion of national income to war production than they could normally support (over 54 percent), covering the resulting gap in the civilian economy with imports from North America. Indeed, it was the ability of the western Allies to trade via the world's oceans, despite the challenge by German U-boats, that allowed the combined production process to work.
By 1944, an immense quantitative mobilization drive nearly doubled the 1938 GDP in the United States (with 42 percent of national income dedicated to the war), steadily increasing the Allied production ratio to 3.3:1 over Germany and Italy and to almost 10:1 over Japan. Combat armament production in the United States alone equaled 50 percent of total world munitions output, with the British adding another 15 percent. Although partly a function of mass production methods, another key to Allied success was the advanced level of economic development in Britain and North America. Well-established transport and other advantages gave the western Allied labor force a 1.4:1 productivity advantage over German workers. The combination led to Allied dominance in the output of a whole range of weapons.
In contrast to the western Allies, the Soviet Union struggled against difficult odds. Although the USSR was much larger than Germany in both area and population, Soviet economic production before the war was only equal to that of Germany, primarily owing to more primitive infrastructure and more primitive machine technology. Following a 25 percent collapse in GDP after the German invasion in summer 1941, the Soviets labored under tremendous pressure to match Axis ground armament production. Over a two-year period, almost half the Soviet economy was shifted from civilian to military efforts, with almost 60 percent of national income allocated to the war in 1943. The ability of the Soviet government to mobilize resources and people proved astonishing, and as noted by Richard Overy, it was this genius for industrial management that allowed the Soviets to pull even with Germany by the end of that year. Despite the accompanying suffering and privation—what Overy called "an exceptional, brutal form of total war"—Soviet workers, helped by Lend-Lease aid from the United States, provided the Red Army with sufficient material to eventually destroy the German armies on the Eastern Front.
Although the German economy was increasingly mobilized for war after 1939, Germany's prewar notion of limited mobilization restricted centralized control of industrial production. Bureaucratic inertia, the resistance of industry to state control, and a dislike of mass production methods placed Germany in a dangerous position by 1941. Hopes for a quick end to the war were finally dashed that winter, and the German government embarked on a more systematic approach to economic mobilization. The ad hoc style of the past was more or less abandoned, although the mobilization program did not truly get under way until after the German defeat at Stalingrad. Between 1943 and 1944, the proportion of Germany's national wealth dedicated to the war effort increased from 52 percent to almost 75 percent, which is revealed in the production figures in Table 1. Despite these gains, however, the smaller European industrial base and difficulties extracting resources from conquered territories meant that German war production could simply not keep pace with the Allies. Germany was beset by enemy armies and heavily bombed from the air, and its economy collapsed in 1945.
In comparison with the larger powers, both the Japanese and the Italians fell woefully short in armaments production. Starting with major disadvantages in resources, transportation, and population, neither country was able to mobilize for a long war of industrial attrition. The disruption of imports, confusion in domestic resource allocations, and the loss of overseas supplies such as fuel, coal, and iron ore led to mobilization failures and declining armaments production. Indeed, labor and resource problems meant Italy was never able to commit more than 23 percent of its GDP to the war effort. Japan fared a little better, dramatically raising the low 1941 ratio (27 percent of GDP) in a massive last-ditch mobilization effort (76 percent of GDP dedicated to military outlays in 1944) before economic collapse helped end the war a year later.
The central core of Allied armaments production superiority was resource and industrial mobilization. Firmly rooted in prewar strategic thinking, the Allies refused to be derailed by Axis success during 1940–1941 and continued to plan for a long war of industrial attrition. Though their efforts were improvised and wasteful, the western Allies and the Soviet Union gathered resources from around the world, mobilized workers and industrial plant on a massive scale, and achieved a steady increase in armaments production. The Axis powers, smaller in size and resources even at the height of their conquests, could not match this effort, and this failure helped bring about their defeat. Timothy L. Francis
Harrison, Mark, ed. The Economics of World War II: Six Great Powers in International Comparison. Cambridge, UK: Cambridge University Press, 1998.; Milward, Alan. War, Economy and Society, 1939–1945. Berkeley: University of California Press, 1979.; Overy, Richard. Why the Allies Won. New York: Norton, 1996.
Timothy L. Francis