A Germany-Soviet Military-Economic Comparison by Arvo L. Vecamer
The Soviet Union was the single most important factor in the defeat of Nationalist Socialist Germany. Germany essentially lost the Second World War on the Eastern Front and the key to that loss can be directly attributed to the different economic and industrial factors of both the Soviet Union and the Third Reich.

To win in an armed conflict, a nation must be able to optimally supply one’s own forces both in offensive and defensive situations. Germany was able to (reasonably) supply her forces with military supplies in the early years of the war, when she fought a series of small, quick action campaigns. But after 1942, Germany could no longer provide her armed forces with the needed military supplies. Quick campaigns gave way to a prolonged war. The Soviet Union however could supply her army with the needed materials and the United States was indeed the global Arsenal of Democracy.

Since Adolf Hitler and the German Nationalist Socialist party came to power in 1933, Germany was both economically and militarily preparing for war. German military officials studied the failures of the last World War, recommended corrective measures and developed new combat techniques, which would deliver a proverbial deadly knockout punch as early as possible in any future conflict. German propaganda specialists made sure that all of Germany’s future opponents also believed that Germany was militarily superior to one and all.

In reality, Germany was not prepared for war in 1939. The German economy of the 1930’s continued to satisfy both civilian and military requirements, even after September of 1939 when production should have shifted to military needs. Hitler believed that he could have it both ways, “Kanonen und Butter” - that is, satisfying the civilian population at home by not placing restrictions on their consumer product consumption, while at the same time satisfying the production needs of Germany's military forces. In fact, Germany was not geared for total war production until 1944. This indicates that German economic and military resource management efforts were not optimally configured for a nation at war previous to that time, and in 1944, the tide had already long since turned.

For example, in FY 1942, Germany produced 30 million tons of steel - but only 8 million tons of that was directed towards military production efforts (airplanes, guns, munitions, supplies, tanks, etc.). The following chart highlights German steel production allocations for the fourth quarter of 1939:

Heer - 3.060.000 tons
Marine - 1.250.000 tons
Luftwaffe - 2.220.000 tons
Military construction - 2.060.000 tons
Total military - 8.590.000 tons

Civilian sector - 7.320.000 tons
Export - 1.730.000 tons
Total civilian - 9.050.000 tons

Total steel - 17.640.000 tons

The civilian sector thus consumed 41.5% of the total German steel production in the fourth quarter of 1939. By the fourth quarter of 1940, the civilian sector “only” consumed 40.8% of the steel output. When Speer reorganized the German economy when Fritz Todt died and he replaced him, it is clear to see where the slack came from.

In terms of human resources, Germany should have increased the hours of a workday to way beyond a regular “9-5” day early in the war. Women were not considered as a serious alternative work force until late in the war either. In 1939, German industries utilized 2.62 million women. In July of 1944, German industries still only utilized 2.67 million women. This average was maintained from 1939 to 1944.

In terms of manufacturing/production related intricacies, the Germans too made a number of long-term calculation errors. For example, the Germans would begin to produce one type of a weapons system (say a Pz IV), then, for whatever reason, added to or modified the basic production model within a very short period of time (the Pz IV came in a myriad of variants as time progressed). This “upgrading” only served to slow down the total number of units which could be produced in the long run. Standardized production equals mass quantaties. The Germans should have produced the Pz IV in just one or two variants and produce them as much as possible, just like the Soviets with their T-34 production. German tanks utilized more complex gasoline engines (higher maintenance and production costs); Soviet tanks ran on very basic diesel engines (and also less flammable when hit). Here too, the Germans realized their error in 1941, but it was too late to convert the German economy over to diesel engines.

From 1939 to 1941, Germany used her now well refined Blitzkrieg tactics to conquer Poland, Denmark, Norway, the BeNeLux nations, France, the Balkan, and so on. The end goal was to obtain a German victory through the utilization of the minimum quantities of men, materials and supplies as possible, and in the shortest time. This worked quite well in the early years of WWII. If there was a chance to win the war, it was most probable during the summer and fall of 1941 provided that the existing resources were not squandered or misused.

But in 1941, the Germans came up against a proverbial brick wall - their summer and fall offensive against the Soviet Union stalled. The winter season arrived with bitterly cold temperatures. Interestingly, on 16 August 1941, General Keitel and the Wehrmachts-Waffenämter agreed that Germany reduce its military production efforts in the fall of 1941. Both were so sure that Germany had defeated the Soviet Union, and Hitler concurred. Then came November and December of 1941. In short, the Germans had not adequately prepared for an extended winter campaign. One of the negative consequences was that many Wehrmacht infantrymen and tankers suffered accordingly (of note is that the Luftwaffe and the KM had sent proper winter clothing to most of their troops in the east).

In the end, Germany’s excellent military leadership and her many technical advantages were not enough to overcome the economic advantages of her enemies. From the very beginning, Germany should have been able to exploit many of her economic and technology advantages far more optimally. Placing Herman Göring in charge of domestic economic planning was not the wisest of selections either. While Albert Speer did achieve some very impressive production increases in 1943, 1944 and 1945 (he became Armaments Minister on 18 February 1942, replacing Fritz Todt), the German efforts were essentially a day late and a dollar short.

Germany lost the Second World War not because of any single military action, she lost it primarily to a war of economic and human attrition.

The Soviet Union took a different approach to the economic situation of the pre-war era. According to I.K. Malanin, a Soviet military history writer; the following six factors determine a nation’s ability to win or lose a war:

  • The economic base
  • The technological competence of the nation
  • The established military doctrines and existing military traditions
  • The geographic environment
  • The ability and the experience of her personnel
  • The comparative power of the enemy

    The economic base: An economic base must be sufficiently developed to survive a prolonged conflict. The Soviet Union had built up a much more effective and reliable economic infrastructure since the 1920’s when compared to the German economy. It was more optimally geared for mass production of simple, yet reliable (military) goods and products. Throughout the Second World War, Soviet military forces never really suffered from serious supply problems, Soviet production centers continued to pour out what was needed on the front lines. But the Germans often suffered from supply shortages. In addition to their own production capabilities, the Soviet Union also obtained significant quantities of U.S. and British lend-lease aid as can be seen a few paragraphs down.

    The technological competence of the nation: Technical expertise must be available to run existing equipment and to develop “this generation and the next generation” of military hardware. In this field, the Soviet Union obtained the needed expertise from abroad. Many state-of-the-art military technologies were in part, provided to the Soviet Union by the Germans. One need only recall the secret German-Soviet military bases, which operated in the Soviet Union in the 1920’s. While the Germans certainly learned much from those experiences, so did the next generation of Soviet military leaders. In addition to the secret bases, both Germany and the United States provided the bulk of the industrial and technical production competencies to the Soviet Union through the myriad of “economic assistance” contracts signed by the Soviet government with such American industrialists as Armand Hammer, Henry Ford, etc. Actual combat competence in the Soviet military was obtained by fighting the Spanish, Japanese, Polish, Finnish and German armies.

    How significant was the American contribution to the Soviet war effort of WW2? Let us look at the Soviet car manufacturing industry of the pre-war era as but one example. The following table might help to place some U.S. contributions into a more optimal perspective:

    AMO vehicles - Moscow plant - assistance through Brandt.
    GAZ vehicles - Molotov Nr. 1, Gorky plant - assistance through Austin and Ford.
    GAZ vehicles - Nizhni-Novgorod plant - assistance through Austin and Ford.
    YAZ vehicles - Yaroslav plant - assistance through Hercules.
    ZIS vehicles - Kuznetsk plant - assistance through Autocar and Brandt.

    On 31 May 1929, Henry Ford and the Ford Corporation signed a contract allowing the Soviet Union to construct GAZ-A cars and GAZ-AA trucks at the Nizhni-Novgorod plant. U.S. engineers directed the construction of the factory and Ford provided most of the tools and jigs. Soviet engineers were sent to Ford’s Rogue River plant near Detroit to study U.S. automotive engineering methodologies (Ford basically told the Soviets the economics behind mass production techniques, American style). The Austin Company, Cleveland, OH, provided the Soviets with assistance for the construction of the AMO-3 two and a half ton trucks.

    The ZIS-5 and ZIS-6 trucks were copies of the U.S. Autocar trucks. Holley carburetors (Holley Carburetors Co., Detroit, MI) were built at the Samara carburetor and motor plant after 1932. The Yaroslav tire plant was patterned after the Seiberling tire plant in Akron, OH. Of interest is that 34% of all trucks manufactured by the Soviet Union during the war were made at the Molotov Nr. 1 plant in Gorky; the GAZ-M trucks produced there being a direct copy of the 1934 Ford truck.

    Because of the United States and all of the economic help it (and Germany to a lesser extent) provided to the Soviet Union during the 1930’s, the Soviet Union essentially advanced technologically 50 years in only an eight to 10 year span. When the U.S. engineers and specialists were forced to leave in the late 1930’s (some were never allowed to leave the Soviet Union despite the fact they were U.S. citizens), the Soviets were really only left with one realistic economic option - continue to utilize the basic systems and the mass production methodologies the Americans had left behind. And that is what they did during the Second World War. They were understandably crude copies of their American counterparts, but never-the-less, they were effective copies.

    The Germans were not able to copy the American production methodologies; though they clearly analyzed and studied them very extensively. German factories were not designed for “mass” mass production. The American and the German economies of scale were so much different. In addition, the Allied air war forced the Germans to increasingly scale down the size of all of their production facilities and disperse them to prevent them from being bombed. By 1942/1943, just when the Germans needed it most, it was no longer possible for them to produce “one item” from start to finish under one roof.

    The aviation sector can serve as but one example. From the European perspective in 1939, flying 400 miles (640 km), from Frankfurt to London - that was a “long” distance flight. And thus, many European fighter a/c of the early World War Two era were built with these “long distance” flights in mind. From the American perspective, flying 400 miles (640 km), from Los Angeles to San Francisco - that was a little puddle hopper flight. Flying 2.500 miles (4.000 km) from New York to Seattle - that was “long distance” flight. And thus, U.S. a/c were built primarily with U.S. type distances in mind.

    The established military doctrines and existing military traditions: This was a rather unique situation for the Soviets in 1939. A great percentage of their soldiers had been trained during the Czarist era. The Soviets melded many traditional Czarist era military traditions with new, “Soviet” ones; as the war progressed, more and more older “traditions” were re-introduced into the Soviet military. Mobile warfare was learned by reading and studying western (primarily British and German) combat philosophies and learning from actual combat situations, such as fighting the Spaniards, the Japanese, the Finns and the Germans.

    The geographic environment: Not much one can say here. A nation has what it has in terms of geographic features and that’s pretty much it. But, one can use geographic advantages to help alleviate military disadvantages. If you can, draw the enemy deep into your country - extend his logistical capabilities way beyond the norm - trade land for time to rebuild you armed forces, etc. - these thoughts and more were prime Soviet methodologies of the pre-war and war era.

    The ability and the experience of her personnel: While the Soviet military truly worked on reforming itself in the 1930’s, the many purges also severely weakened the aggregate experience level of her military personnel. This placed the Soviet Union at a severely disadvantageous position in June of 1941. Only by 1943 and 1944, did the Soviet soldiers reach general parity with their German counterparts; and even then, the average German soldier held many competence and experience advantages over many of opponents.

    The comparative power of the enemy: Since the 1930’s, the Germany and the Soviet Union were engaged in an arms race. After first investing heavily in building up an industrial base, starting in approximately 1937, the Soviet Union’s economy switched over to the production of military goods. But the Germans had a bit of an early lead - they started the arms race in 1933 (earlier in secret). From 1939 to approximately 1941/42, the German military economy retained a distinct advantage in both quality and quantity when compared to same of her opponents. By 1943, the Soviet Union had caught up and began to surpass the German production capabilities.

    Allied lend-lease aid to the Soviet Union during the Second World War was also a factor in the Soviet economic and military situation during WWII. The United States provided the Soviet Union with approximately USD 11 billion in aid. Great Britain and Canada provided the Soviet Union with an additional USD 6 billion in aid. Both figures are for USD values in 1945. Since 1945, Soviet historians have tended to downplay the significance of Allied lend-lease efforts - it is unequivocably accepted that in the end, over 20 million Soviet citizens needlessly lost their lives in the conflict, lend-lease aid or not. But Allied lend-lease aid did make a difference, even if only a small one, to the Soviet war effort, as can be seen in the below paragraphs.

    As soon as the German Army crossed into the Soviet Union on 22 June 1941, Stalin asked Churchill (and Roosevelt) for military assistance. Both agreed to provide it (not only in the form of military supplies, but after December of 1941, also in the form of opening up a “second” front in the west). The first lend-lease convoys to in fact depart for the Soviet Union, did so before any formal document had been signed between the Soviets and the Western Allies. It need be noted that although the United States was not officially at war with Germany, the U.S. agreed to help supply the Soviet Union with lend-lease aid. The promised supplies were agreed to in a series of protocols. The Soviet Union would receive goods and supplies up front, and it could repay its debts at the end of the war in cash or negotiable bonds (plus a small interest charge for late or non-payments).

    On 06 October 1941, Winston Churchill advised Josef Stalin that a British convoy would depart from the west every 10 days. The first official convoy, PQ 1, departed from Iceland bound for Archangel (Archanglesk). It carried 20 tanks and 193 fighter a/c. It, as well as the next few PQ’s made it safely to and from the Soviet Union with their freight. It need be noted that in February of 1942, British lend-lease aid to the Soviet Union received a higher priority level than supplying British Home-Guard units and Commonwealth forces operating in the Pacific with military goods. Thus, badly needed Hurricane fighters went to the VVS, not to the RAF in Burma.

    The Allied lend-lease aid effort was truly a monumental undertaking. During the course of the Second World War, the Western Allies sent 811 ships to Soviet ports filled with lend-lease aid. The Germans sank 58 of those ships. 33 of the 811 ships returned to port (mechanical breakdowns; damaged by a German attack, but able to proceed under their own power; etc.).

    Murmansk and Vladivostok were among the most utilized ports. The route over the Pacific was safer, but it also took longer. Allied convoys had to first cross the Pacific, then the lend-lease aid goods had to traverse Siberia via train. Initially, Iran was hardly used as a trans-shipment route. The existing infrastructure needed to transport lend-lease goods to the Soviet Union was not optimal. After 1943, when the Allies developed better transportation networks in Iran and the Middle East in general, the Persian route became a more critical link. Of all the lend-lease aid, approximately 50% was delivered via the Pacific, 25% via Persia and 25% via the northern route to Archangel and Murmansk.

    If the Allies were not well prepared to initiate lend-lease support to the Soviet Union in 1941, so was the Soviet Union not in an optimal position to accept the aid. Interestingly, in August of 1941, the heaviest crane at Murmansk could only lift an 11-ton load. The British had to quickly supply the Soviets with a heavier crane to help speed up the lend-lease off-loading efforts. The RAF also provided aerial support to protect Murmansk from the Luftwaffe. With VVS approval, the 151st RAF Wing arrived at their new base in Vaenga (about 20 miles out of Murmansk) in August of 1941 with 24 Hurricanes (15 additional Hurricane a/c were shipped in crates to Vaenga).

    The first PQ’s arrived safely in the Soviet Union with their precious freight. But the Germans reacted quickly by sending both Kriegsmarine and Luftwaffe units against the new threat. The first major loss was inflicted on PQ-13 in March of 1942 (PQ-13 lost five ships). PQ-14 and PQ15 also took heavy losses. Churchill wanted to increase the spacing between the departing convoys as a measure to offset losses. The Royal Navy wanted to stop all lend-lease aid during the summer months. The sun was out nearly 24 hours a day in the far northern Arctic waters and this would make any ship easy pickings for the Germans. For political reasons, the British could not select either option. The convoy schedule had to continue. PQ-16 was given a heavier escort and was increased in size to 35 merchantmen. The Germans sunk seven merchantmen and damaged one in PQ-16. PQ-17 was delayed in departing because the RN had to first protect its convoys going to Malta - it did not have enough escort vessels to go around. The U.S.Navy also could not provide escort assistance at that time because the USN was engaged in escorting U.S. merchantmen off of U.S. waters. PQ-17 sailed in June of 1942; it was a disaster for the Allies. The Germans sank 23 of the 36 ships. PQ-18, which departed on 02 September 1942, lost 13 out of 40 ships.

    Here is an example of PQ convoy. In January of 1944, an American lend-lease convoy left Seattle bound for Vladivostok. Its manifest read as follows:

    46 merchantmen (all 8-10K ton ships); built by McCormack Ship Yards; Soviet flagged (to avoid being torpedoed by the Japanese who could attack U.S. flagged vessels but who could not attack Soviet flagged ones) and Soviet crewed.

    Six of the 46 ships were loaded with ammunitions and small arms. Four of the 46 ships were loaded with foodstuffs. Two of the 46 ships were loaded by Dodge (presumably with trucks). One ship was loaded by Westinghouse (presumably with communications gear).

    They carried:

  • 22.000 tons of steel provided by U.S. Steel.
  • 3.000 truck chassis, by Ford (the Soviets also assembled U.S. trucks from parts).
  • 3.000 truck differentials from Thornton Tandem Co.
  • 2.000 tractors by Allis Chalmers Co. (agricultural and military use)
  • 1.500 automotive batteries from the Price Battery Corp.
  • 1.000 aircraft provided by the North American Aviation Co.
  • 612 airplanes from the Douglas Aircraft Co.
  • 600 trucks from Mack.
  • 500 Allison aircraft engines.
  • 500 half-tracks from Minneapolis Moline Co.
  • 400 airplanes from Bell Aircraft
  • 400 electric motors from Wagner Electric Co.
  • 400 truck chassis by GM (see Ford above)
  • 310 tons of ball bearings from the Fafnir Company.
  • 200 aircraft provided by the U.S. Navy
  • 200 aircraft engines by Aeromarine
  • 100 tractor-trailer units by GM (trucks)
  • 70 aircraft engines by Pratt & Whitney

    In the end, Ultra and more dedicated Allied naval efforts helped to secure the northern lend-lease routes from German attacks. The Kriegsmarine lost a number of heavy ships for their efforts as well.

    The following table, not an inclusive one by any means, shows the extent of lend-lease aid the Western Allies provided to the Soviet Union from 01 October 1941 to 31 March 1946 (not a typo, aid went on well after WWII ended). CW - Commonwealth contribution; US - American contribution:

    Aircraft - 7.411 (CW) + 14.795 (US) = 22.206
    Automotive:
    --- 1.5 ton trucks 151.053 (US)
    --- 2.5 ton trucks 200.662 (US)
    --- Willys Jeeps 77.972 (US)
    Bren Gun Carriers - 2.560 (CW)
    Boots - 15 million pairs (US)
    Communications equipment:
    --- Field phones - 380.135 (US)
    --- Radios - 40.000 (US)
    --- Telephone cable - 1.25 million miles (US)
    Cotton cloth - 107 million square yards (US)
    Foodstuffs - 4.5 million tons (US)
    Leather - 49.000 tons (US)
    Motorcycles - 35.170 (US)
    Locomotives - 1.981 units (US)
    Rolling stock - 11.155 units (US)
    Tanks - 5.218 (CW) + 7.537 (US) = 12.755
    Tractors - 8.701 (US)
    Trucks - 4.020 (CW) + 357.883 (US) = 361.903

    In the early 1930’s the U.S. helped lay the foundations for a formidable Soviet truck production capability. During the war, Soviet production efforts were augmented through lend-lease aid. In terms of truck usage, U.S. lend-lease trucks generally went directly to front line combat units. Soviet built trucks were generally used in rear areas. Chevrolet, Dodge, Ford, Studebaker, etc., all could be found on the eastern front. The Soviet Union ended the Second World War by having over 650.000 trucks available for use. Of those, 58% were Soviet in origin, 33% British or U.S. and the remaining percentage captured from the Germans.

    U.S. lend-lease food supplies were sufficient to supply 6 million Soviet soldiers with one pound of (quality) consumables for each day of the war. Also, U.S. food supplies, such as canned Spam, had a seemingly indefinite shelf-life and could be stored anywhere without spoilage when compared to one of the standard Soviet military staple diets, dried fish (consuming dried fish causes one to drink more - this in turn increases the number of "breaks" one has to take - and that is not a desirable condition if one is close proximity to enemy lines).

    Lend-lease aid amounted to approximately 10-12% of the total Soviet war production effort. While this does not seem like a significant amount, having 10% more key supplies available could make the difference between holding the line to going on the offensive.

    From the Soviet geo-political perspective, Germany was enemy number one; especially after 1933. In order to defeat Germany, the Soviet Union would first have to establish the economic and the military infrastructures that would lead to the primary goal (the defeat of Germany). The Soviets searched high and low for the best of everything the west could offer; Christie tank designs from the U.S.; U.S. industrial production know-how; Czechoslovakian and German military hardware; etc. The Soviets also made a “top to bottom” review of their military supply system to seek the most efficient solutions. Western armies of the World War Two era were still modeled on the old Napoleonic way of thinking - provide each combat division with ample service and supply capabilities so they can draw upon rear area stocks as needed. The Soviets reversed that order - army depots and army transportation units would (more efficiently) deliver supplies to the troops; more combat troops could then be placed at the front lines. Of note is that the Soviets military transportation system was far more mechanized than the German one (though no one in WW2 beat the nearly 100% mark of the U.S. transportation system). The German military transportation system still relied on horses in May of 1945.

    Mention is often made of the fact that Soviet weapons were crude or simple in design and manufacture. While many were clearly so in appearance, they nearly always worked. German weapon systems, for the most part, became more complex as the war progressed and they did not always work as expected (such as the new Pz V’s at Kursk). There were never enough German service technicians on hand to keep all of the German military hardware operating at peak strength. Building complex military technologies often requires having a larger pool of technicians available to fix the inevitable breakdowns.

    The bottom line - the ultimate question is one of simple economics and opportunity costs. How does a nation allocate its existing economic resources? What could one do instead if one changed one’s econimic priorities? One could produce a mighty slick looking and most effective Jagdpanther V with all the bells and whistles or one could opt to produce five shoddy looking, but most functional and reliable T-34’s instead. And so the equation goes. The Soviets opted for the latter scenario and they essentially defeated Germany in May of 1945. The Soviet Union produced great quantities of very basic weapons systems to counter the exceptional skills of the German military command. The Germans elected to go for the Jagdpanther V type scenario - they thus lost the economic battle of the war, and thus the war itself.