University of Wisconsin Digital Collections
Link to University of Wisconsin Digital Collections
Link to University of Wisconsin Digital Collections
The History Collection

Page View

Military government weekly information bulletin
No. 23 (January 1946)

Highlights of policy,   pp. 4-9 PDF (2.6 MB)


Page 4


Militarp Government financial experts
think thef are. and are f akin-a qt.ftc fn
demilitarize them for a peacetime econ-
oma.           : .'
rAre )3anks a §fhreaf to Ofur j'eace
Ask anyone what a country needs to
prepare for a war. Most probably you will
get a description of huge airplane fac-
tories, armament plants, railroads and
many other industrial enterprises. Few
people would mention the quiet, peaceful,
little bank that operates on main street,
as one of the important necessities of war
preparation.
It is perhaps somewhat difficult
to see a threat to peace in a bank.
There are no great hydraulic presses, no
rows of gleaming lathes, no huge vats
and coils. The clicking of adding ma-
chines and the murmuring of clerks is a
peaceful sound. Yet, this citadel of peace
and quiet is even more dangerous to
world peace than the factories themselves.
It is the corner stone on which the Ger-
man war industry was built and operat-
ed. Today in Germany it is as important
to demilitarize the banking structure of
the country, as it is to destroy her war-
producing factories. A destroyed factory
can be rebuilt... if money can be found.
To prevent this money from being
found, Military Government iv the
U. S. Zone, has taken two steps toward
demilitarizing  the  financial  struct-
ure of Germany. The first step, now
completed, was an overall denazification
of all banking agencies; the second step,
still in process, is complete decentrali-
zation of the banking system.
.-The- first step, removing all dangerous
individuals' from banking positions, was
successful, despite the early predictions
that banking facilities would be hamper-
ed. The continued operation of thebank-
ing facilities during the denazification
was due to the energy with which the
MG finance officers sought replacements,
and the sound judgment they used in
making their selections. As a result the
banks are enjoying an increasing public
confidence, under a new and clean man-
agement.
The second step, breaking the highly
organized, machine-like, banking system
down into small functional units, is one
of the most important steps yet taken
to prevent Germany from again becom-
ing a warrior nation. This huge banking
monopoly was the instigator as well as
the supporter of the huge economicblud-
geon which enabled Germany to smash
Europe to her knees.
BANKS BUILD INDUSTRY
In Germany, more than in any other
country, the money for industry has been
obtained from banks. Germany does not
have the traditions of private invest-
ment, such as those of the United" States
and Great Britain. Because Germany's
industrialization came relatively late,
competition from other industrialpowers
left too little time to develop a class of
private investors, or to build up capital
reserves out of profits. To get capital
in a hurry, industry turned to the banks.
The banks willingly committed them-
selves heavily in industrial shares. This
f
C7pqht" ht    loticy
aut   Ig


Go up to Top of Page