Essentially no.
World War II, 1939-1945 See also: World War II
While it could finance the whole war with inflation, the German government didn't want to repeat the mistakes of World War I - at least a part of the cost should be paid with higher taxes and similar measures. One major problem has been the supplying of small change, this was taken care of by the Rentenbank, whose notes have been well known to the public. Another issue was with the monetary needs in occupied territories. Areas, that were made part of the Reich - Poland, Alsace-Lorraine and Austria, had to use the Reichsmark as money. In other areas - Norway, Ukraine, the Baltic, Netherlands etc. - were issued Reichskreditkassenscheine (Reich's credit treasury notes) to pay the troops.[1]
The "RKK-scheine" were designed to place the entire burden of the occupation on the country in which they were issued and to prevent any indirect drain on German stocks or diversion of German production arising from an unrestricted filtering-back of notes into the Reich. In addition, it was anticipated that the influx of the notes into circulation would alleviate the temporary shortage of local currency resulting from panic hoarding and the exodus of refugees from the area. This proved to be the case, particularly in Poland and Belgium, where the central banks followed the established governments into exile and took the note supply with them.[2]
All important goods were rationed, this forced economizing has been carefully planned and prepared. Another advantage of this well-run system was, that a growing part of the income of the population ended up in banks and savings banks, which allowed the government to deploy massive amounts of medium- and long-term bonds. But in this war, the issues of more debt were not accompanied by any propaganda, it was "noiseless war financing".
The income tax was raised by 50%, to a maximum rate rate of 65% of income, taxes on alcohol and tobacco were also highly increased. German states, districts and other public institutions also had to contribute to the war effort.
Several other taxes have been increased and introduced as the war went on. Various tax discounts and freeing from taxes were offered to the population, mostly set to expire after the war and leading them to deposit more into the banks. The state debt grew even more as evidence of the huge costs of war.
CHART
Money lost its function as a carrier of purchasing power. Important was only to get and spend the rations on bread, fat, shoes and other crucial goods, which became harder and harder.[1]
Thank you for the in depth reply. This is a very interesting read. I hate to sound like an idiot, but could you clarify what the paragraph below "CHART" means? Is it saying that money was no longer important because the rationed goods themselves became harder to get?
Thank you for the in depth reply.
Just copy/pasta from the link. I was curious so I did a quick search.
Is it saying that money was no longer important because the rationed goods themselves became harder to get?
That's essentially what I got out of it. Between Germany's fixed pricing and rationing, inflation can't get much traction with scarcity as a result. People had savings, they had the money to buy, if it was available.
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