Theory of Friendly Nations' Surprise (Part 7)
Volume 6: Great Depression Era · Chapter 105
"Russia has solved the shortage of light industrial goods through technology introduction and large-scale imports from China." After explaining the Soviet solution, Schacht waited quietly for Hitler's questions. This was a problem requiring some economic knowledge to understand, and Schacht was unwilling to volunteer too much information, nor did he think Hitler's economic knowledge reached the level of an expert.
Hitler thought seriously and did not speak immediately. Just when Schacht thought Hitler would remain silent for longer, Hitler unexpectedly spoke, "I think the Soviet Union cannot satisfy such large import demands just by exporting raw materials."
Schacht felt much more relaxed. To have such an understanding was at least passable, allowing the conversation to continue. If he simply believed that the Soviet Union had abundant resources and could completely rely on raw material exports to meet import demands, there would be no way to discuss reality.
"My Führer, the Soviet Union is not incapable of producing light industrial goods at this stage. After importing Chinese light industrial goods, they also import relevant technology and equipment from China to build their own factories. Even for light industrial goods with the worst production capacity, the Soviet Union's self-sufficiency rate is over 50%. The Soviet Union only basically relies on purchases for light industrial goods that they really deem unimportant and have small transaction volumes.
"Even so, the Soviet Union's raw material exports cannot meet trade demands. As far as we know, the bulk of what the Soviet Union is currently exporting to China is heavy industrial goods. The Soviet Union exports large amounts of pig iron and power plant equipment to China. Especially for power plant equipment, although the technology was imported from China, the Soviet Union in turn exports large quantities of unit equipment to China, effectively balancing the import-export gap. More importantly, the Soviet Union's production capacity in the heavy industry sector continues to improve along with this."
Hitler could hear that Schacht actually wanted to persuade him to cooperate with the Soviet Union in this regard as well. This was a major decision, and Hitler did not intend to make a decision in a hurry. But Schacht's next words forced Hitler to be moved, "My Führer, according to our intelligence, the Soviet Union and China are preparing to jointly build over 200 thermal power plants by 1939, each with an installed capacity exceeding 200 megawatts. China, constrained by French pressure, cannot cooperate with Germany. But the Soviet Union does not care about France's attitude. If we can cooperate with the Soviet Union, we effectively join this large market. If the cooperation succeeds, we can see China's attitude."
500 thermal power plants meant an astronomical amount of equipment. After construction was completed, a large number of maintenance and replacement parts would be needed every year. Hitler did not want to improve the Soviet Union's industrial strength, but such huge orders meant huge profits. Germany was currently desperately building its military industry and also needed a large amount of electricity. If it could export a large amount of equipment, the resources obtained could also meet Germany's domestic industrial needs.
Hitler stood up, walked around the room with his hands behind his back, and made up his mind. He turned to Schacht, "Do you think the Soviet Union will agree to this?"
Schacht felt there was hope, suppressed his inner impulse, and answered calmly: "My Führer, the Soviet Union has already sent people to meet with us, expressing the hope to import heavy industrial equipment."
"Then let's give it a try," Hitler made the decision.
Schacht immediately stood up to handle the matter, but heard Hitler ask again: "Schacht, do you think China's economy is really that strong?"
The question Hitler raised was also something Schacht cared about very much at one point. China had a large population and a foundation for rapid light industry. The Soviet Union relied on massive amounts of light industrial goods to rapidly improve people's living standards; Schacht could not only understand this but also felt it was logical. But heavy industry required a massive educated population. A 200-megawatt thermal power plant required dozens or hundreds of engineers. If China possessed 200 thermal power plants, it meant they needed 20,000 university-educated engineers.
Fortunately, China and Germany had exchanges in education systems. Schacht had studied China's education system through this intelligence source, and the results astonished him.
After He Rui arrived in the Northeast in 1915, he began the construction of compulsory education. Its arduousness reminded Schacht of the early days of compulsory education in Prussia a hundred years ago. In the Northeast Government's fiscal budget, the budget for education reached 8%.
By 1925, after He Rui established a unified central government, the number of science and engineering university students in the same grade in China exceeded 30,000. In the following eight years, China went all out on education, and the number of science and engineering graduates increased at a rate of 20% annually. By 1933, the number of new science and engineering university students in China reached 130,000.
In 1937, when these 130,000 science and engineering students graduated, the number of new science and engineering graduates recruited by China would probably reach 260,000. In order to provide quality education for these students, the Chinese government used the connections established when establishing the Asian International Tribunal to invite professors from various countries to lecture in China. Huge resources were invested in the field of academic research. Speaking only of quantity rather than quality, China could provide enough high-quality labor for its heavy industry.
Schacht answered: "My Führer, I believe that within ten years, China will become a very powerful industrial country. But the quality of Chinese engineers is likely somewhat exaggerated. At present, the ability demonstrated by Chinese engineers should be much worse than the level China advertises."
This was not Schacht deliberately belittling China; Schacht was applying his experience of German engineer development to China's engineer level. But looking at current performance, the level of Chinese engineers seemed to be about the same as Germany, or perhaps a little worse. But this comparison was not normal; engineers relied on accumulation. Germany had decades of accumulation, while China had only 20 years. If the levels of engineers in both countries were similar, it was abnormal according to normal laws. If interpreted using Nazi racial theory, it would be even more incredible.
Nazi racial theory held that Germany was advanced and powerful because of racial superiority. If China became more advanced and greater in a short time, wouldn't it mean that the Chinese race was superior and more powerful than Germany?
Schacht himself had no interest in this set of racist theories, so he simply didn't mention it.
Hitler did not wish for a powerful Soviet Union. Hearing Schacht believe that the actual work ability of Chinese engineers was questionable gave him some comfort. According to German investigations, the number of Soviet engineers was limited, and their strength was inferior to German engineers. Chinese engineers were also a bunch of rookies who only knew how to boast, so the pressure on Germany's east was not great. Moreover, this false propaganda could just be used by Germany to intimidate Britain and the United States.
Ending the meeting with Schacht, Hitler's secretary brought news of Ribbentrop's return. Hitler was not surprised by the news of Ribbentrop returning so quickly and asked the secretary to notify Ribbentrop that he prepared to have dinner with him.
Seeing that it was almost time for dinner, Hitler did not continue to process work but thought about the world situation. The Soviet Union in the East was constantly growing stronger and would inevitably become Europe's most powerful enemy in the future. In the geopolitical suggestions recently proposed by Professor Karl Haushofer, President of the German Academy, he believed that a Berlin-Moscow-Zhengzhou Axis could be built. Once this axis was established, it could control the entire World Island and confront the Anglo-Saxon forces.
Hitler thought this view was too wishful thinking. Although Russia and China had vast territories, their strength was too weak. And once these two countries truly became powerful, Germany would have no strength to confront such colossi.
The only development direction Germany could choose was to first unify the Germans, and then unify the German regions to form a powerful force capable of confronting any great power in the world. To achieve such an ideal, Germany first had to arm itself quickly and then defeat France.
If the current Germany still possessed the strength of the Second Reich, Hitler believed Germany was fully capable of realizing such a strategic concept. But the current Germany had been beaten to a pulp by the Versailles System and was completely unable to launch a war. The urgent task was to use all means to obtain resources for development, and Germany had to be prepared for blockade during wartime. Wilhelm II's mistake back then was not only fighting on two fronts; Germany's industry was overly dependent on world trade, leading to shortages of many materials shortly after the war began. Hitler definitely could not repeat the same mistakes; besides trying his best to avoid a two-front war, he also had to stockpile enough materials beforehand.
This was a very difficult task for the current Germany. Hitler discovered once again that Schacht's idea was correct. Even if it temporarily increased the Soviet Union's industrial strength, he had to complete Germany's industrial accumulation through the large-scale thermal power plant construction with the Soviet Union and China as much as possible.
While thinking about the situation to be faced, Ribbentrop arrived. Facing Hitler, Ribbentrop did not conceal the process of this trip. Of course, concealment was useless. Now meetings between high-level national officials had minutes; what He Rui said and what Ribbentrop said would be recorded by both sides, and records would be exchanged.
Hitler did not blame Ribbentrop. He already roughly knew that the goal could not be achieved when he sent Ribbentrop to China. The geopolitical environment constructed by China was very favorable to China, and there was no reason to destroy such a situation. On the contrary, the list provided by He Rui interested Hitler somewhat. Looking at the people on the list, Hitler didn't know most of them. According to Ribbentrop's explanation, these people were all Jews in the German academic community who had already been purged.
Although these people had been purged, they were indeed big shots in the academic community. Letting them go abroad casually would become academic assistance to other countries, so the German side also restricted these people from leaving Germany.
Hitler originally didn't want to bother with these people, but thinking of the thermal power plant construction plan with Schacht concerning China and the Soviet Union, Hitler suddenly had an idea. Since the Chinese wanted these Jews, they had to pay a price. If Germany and the Soviet Union cooperated on thermal power plants, and China raised objections, these people could serve exactly as bargaining chips.
While considering this matter, Ribbentrop said again: "My Führer, I have a view on Sino-French relations."
"You've worked hard, let's eat first," Hitler said gently.
Ribbentrop felt a wave of excitement in his heart and quickly replied: "I am willing to serve the great cause of Germany."
Hitler nodded, "I believe in your loyalty to our cause."
The food was served quickly. Because Hitler himself did not smoke, drink, and basically didn't eat meat, his meal was just bread, a portion of vegetables, a portion of soup, and an apple. Since the Führer's food was so simple, naturally Ribbentrop didn't have any lavish meal either.
The two quickly finished the meager food before Ribbentrop stated his view. In the Sino-French quasi-alliance, France was in the dominant position. Therefore, China criticizing Germany and lowering the diplomatic level between China and Germany was the Chinese government's way of showing goodwill to France. But China, in a subordinate position, was naturally unwilling to be dominated by France, so China proposing anti-racist views was also to disgust France. In terms of racist persecution, Ribbentrop believed that France was even worse than Germany. This was the real reason why China insisted on anti-racism.
Hitler listened to Ribbentrop's analysis and did not fully agree. But he did not raise objections; after all, China was too far away, and as long as China became powerful, it would naturally challenge the order in the Pacific region. Although Britain believed that the East Asian order led by China was a "beneficial supplement" to the Versailles System, Hitler did not think so.
Based on traditional European political understanding, after the balance of power between the two sides was completely lost, a powerful Far East would sooner or later make a move on colonies like Southeast Asia. No matter how Britain shouted, its purpose was nothing more than to temporarily stabilize the situation. Thinking of this, Hitler suddenly felt that throwing those experts China needed to China wasn't a bad thing. The faster China developed, the sooner the balance of power would be lost. Once Britain was forced to break out into war with China again, Germany's opportunity would come. And before the imbalance, Germany could also fully utilize this change in power balance. The best part was that the imbalance of power in the Pacific would not only force Britain to project a large amount of strength overseas but would also drag the United States into the water.
A major reason for Wilhelm II's defeat lay in the US entering the war. The Kaiser's Battle launched by Germany was ultimately contained by a large number of US troops. If not for those hundreds of thousands of fresh troops, Germany was fully capable of fighting into Paris. If these Anglo-Saxon countries like Britain and the US fought with the East Asian region led by China first, Germany would be much more relaxed.
Britain projected strength overseas, and France could only rely on supporting Poland to contain the Soviet Union. With France's national power, it had no more strength to contain Germany. If France still took striking Germany as its primary goal, France could only choose to conclude a military alliance with the Soviet Union. If a Franco-Soviet military alliance appeared, Hitler would wake up laughing from his sleep.
The Versailles System was meant to contain Germany and also confront the Soviet Union. A Franco-Soviet military alliance meant that the Versailles System had effectively collapsed, and as long as Germany used this as a reason, it could demand Britain to fully loosen restrictions on Germany's military expansion. Moreover, it was impossible for France to gain understanding from Europe and the United States. A Soviet-German military alliance was inherently a betrayal of Britain and the US.
Thinking of this, there was even a smile on Hitler's face. Ribbentrop couldn't figure out what Hitler was thinking and was considering whether to ask when he heard Hitler say: "Ribbentrop, I hope you will next discuss world disarmament with the United Kingdom."
Ribbentrop was stunned for a moment, then replied: "My Führer, I believe the current world disarmament should be cut according to Germany's existing military standards."
Hitler knew Ribbentrop was adopting a retreat-to-advance method. The Treaty of Versailles stipulated that the number of Germany's army could not exceed 100,000, and it could not possess heavy weapons, nor weapons like submarines and aircraft. If countries around the world really reduced their army numbers to Germany's standard, it would be no different from actually disbanding the armies. Countries would never agree no matter what. As long as these countries refused, Germany could legitimately demand the lifting of restrictions on Germany's military expansion.
The key point at present was not what scale Germany expanded its army to, but whether Germany could break through the restrictions of the Versailles System on Germany. As long as the restrictions were broken, Germany could expand its army according to its own steps.
Ribbentrop emphasized even more, "My Führer, the number that Germany can expand its army to is the number we will discuss with Britain."
Facing such a capable fellow, Hitler was very satisfied.
Unexpected surprises came one after another. A few days later, Schacht conveyed the Soviet Union's view. The Soviet Union stated that it was willing to cooperate with Germany in the field of large-scale thermal power plant manufacturing. Now the Soviet Union had a batch of equipment that needed precision machining, and the Soviet Union was willing to trade with raw materials.
Hitler was happy to see this barter trade; what Germany needed most now was raw materials. Germany's originally not-strong-enough financial industry suffered heavy losses after the war, and now foreign financial transactions had to go through other countries' financial channels. If they went through Anglo-American channels, they would likely be made things difficult for. If they went through France's financial channels, they were afraid France would immediately detain these funds and force Germany to use this money to repay debts. In present Europe, the only country that could stably provide large amounts of raw materials was the Soviet Union. The Soviet Union using raw materials to repay debts was just too good!
The Soviet side was both happy and surprised after getting a crisp reply from Germany, with a larger proportion of happiness. However, when General Secretary Stalin asked Kirov whether China would suddenly stop the contract due to insufficient industrial strength, Politburo member Kirov didn't know how to answer either.
Taking advantage of the economic crisis in the capitalist world, the Soviet Union purchased a large amount of technical equipment, making Soviet industry advance by leaps and bounds. But before the economic crisis broke out, China had already begun to introduce technology and equipment from all over the world on a scale several times that of the Soviet Union.
After the Soviet Union itself swallowed so much technology and equipment, it found that its engineers were not only insufficient in number but also greatly insufficient in strength. The time required to thoroughly digest and absorb these technologies was longer than in the original plan. So the Soviet Union adopted the method of directly introducing complete sets of equipment to improve efficiency.
The China that He Rui inherited had an industrial strength inferior to Tsarist Russia. Why did China seem to have completely no problems in this regard? Any technology and equipment was quickly mastered by China after arriving in China. The leading cadres responsible for industry in the Soviet Union were also quite puzzled by this.
Kirov was now appointed as the chairman of the Soviet State Planning Committee, and he also had no way to explain to Comrade Stalin. The current Soviet Union had slowed down the speed of introducing technology and used its strength on digestion and absorption. This led to a part of the factories that were to start construction in the Soviet Union's original plan being postponed. Kirov wasn't quite sure whether what General Secretary Stalin wanted to ask was whether China had the ability to fulfill the contract, or if he wanted to implicitly express dissatisfaction with the Soviet Union pausing capacity expansion.
Finally, Kirov said: "Comrade General Secretary, I believe the industrial sector should unswervingly execute the updated plan."
General Secretary Stalin nodded with satisfaction upon hearing Kirov say this, "Comrade Kirov, Soviet industrial development will definitely encounter many problems, but I believe these problems can definitely be solved. Any pause now is a crime against Soviet industrial construction. We cannot allow such a crime!"
Kirov knew how much the Soviet Union currently lacked engineers, but since General Secretary Stalin had already said so, Kirov could only express support. To reassure Comrade Stalin, Kirov said as if joking: "Those factory directors who cannot complete their tasks must be sentenced and sent to Siberia."
Stalin was very satisfied with Kirov's answer. As General Secretary, Stalin naturally knew the problems the Soviet Union was currently encountering; factories had many safety accidents because of the lack of sufficient engineers and technical personnel. But Stalin firmly believed that such problems could definitely be solved through stricter management.
But no matter how strict the management, there first had to be objects to manage. Stopping the pace of construction would not only fail to solve the problem but would instead delay development. That Kirov could adhere to the current policy meant that Kirov was a qualified future successor.