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Pragmatic economists have pointed out that Fascism is a reflex of the lean and bony ridges and sandy or sparse soil of Central Europe. Socialists insist that Fascism is not inevitable anywhere, and that a different system of property, political and consequent international relations would result in plenty for the German people even though their soil and raw materials are poor. But whatever the truth of the Socialist argument, it is axiomatic that a nation's total well-being under any economic system is limited by two things: the nature of the land and what is under the land, and the number and ingenuity of the population. A nation of clever and ambitious people with scant natural resources has but one recourse: it must sell its services by fabricating and transporting raw materials supplied by others. The economic history of Germany since the third quarter of the last cen- tury has been the history of a people consciously and steadfastly steered by their State to sell services. "We must export," recently said Herr Hitler, a legitimate heir to this tradition, "or die." In the rush to catch up to western industrial powers, Germany has tried ever since 1871 to syncopate history. A patron saint among German economists is Friedrich List, who spent seven years in the U. S., learned to admire Alexander Hamilton's protectionist philosophy and went home to write his National System of Political Economy (1841). While Prussia was busy consolidating the German nation by successive wars with Denmark, Austria and France, no one paid much attention to List. But after 1871, he provided justification for what Aggrandizer Bismarck wanted to do.
An aristocratic landowner from Pomerania in the backward German east, Bismarck cared little for the doctrines of economic freedom from feudal interference that were popular in free trade England. He made German capitalism an "assisted" capitalism, far more consciously purposeful than the economic systems of the west. Price-fixing and market-sharing cartels were encouraged; protection was granted to both agriculture and industry. The Prussian railroads were bought for the Prussian State, and the Social Democratic trade unions were won over to the paternalistic system partly because of the general pre-War prosperity and partly because Bismarck had introduced sickness, accident and old-age insurance for wage-earners.