Lederer examines how prolonged war transforms production, purchasing power, and class relations, principally in Germany. His central argument is that material impoverishment can coexist with rising monetary wealth: war consumes productive resources while concentrating claims on future output among producers and property owners. The analysis moves from the structure of war economics through agriculture, industry, and wage earners to the distributional conditions of reconstruction.
Die ersten Ueberlegungen über die Kriegswirtschaft sehen im Kriege die Störung des ökonomischen Prozesses, und zwar des Zirkulationsprozesses, wie er uns in der Geldbewegung entgegentritt.
English translation: The first reflections upon the war economy see in war the disturbance of the economic process, and indeed of the process of circulation as it confronts us in the movement of money.
Against this initial emphasis on circulation, Lederer makes production and distribution decisive. Monetary movements must be interpreted through changes in the material economy. He distinguishes an initial boom, subsequent decapitalization, and intensified compulsory mobilization that constricts civilian production to enlarge armaments output. The problem becomes the capacity to reproduce the productive system.
Insbesondere ist es die Frage der automatischen Reproduktion des ganzen Erzeugungsprozesses, die akut werden kann, wenn der Krieg lange genug dauert.
English translation: In particular it is the question of the automatic reproduction of the whole process of production that can become acute if the war lasts long enough.
Military production generates monetary incomes while goods available for civilian purchase diminish. Accumulated money therefore need not represent an equivalent accumulation of usable wealth. Blockade and trade controls also separate national price systems, so maintained exchange rates cannot establish comparable domestic purchasing power. Monetary stabilization may postpone adjustment without resolving material shortages.
Extensive state direction does not, in Lederer’s account, abolish capitalist relations. Rationing restricts purchases without guaranteeing access independently of money, and administrative intervention can strengthen particular owners. The question is who acquires command over resources, not simply how extensively the state regulates economic activity.
Agriculture illustrates how scarcity can enrich producers despite declining physical output. Lederer reconstructs prices, costs, yields, and earnings through incomplete evidence and hypothetical calculations. Price increases can exceed rising costs and compensate for reduced quantities; beyond that point, further scarcity can raise receipts from the remaining supply.
Nunmehr aber schießt die Bewegung der Preise darüber hinaus: je geringer die Quantität wird, um so teurer verkauft sich die verbliebene Gesamtmenge ⁸).
English translation: Now, however, the movement of prices shoots beyond this: the smaller the quantity becomes, the more dearly the remaining total quantity sells 8).
These gains do not necessarily improve farmers’ immediate consumption, since industrial goods may be unavailable. Nevertheless, debt repayment, cash reserves, and relatively continuous production give agriculture advantages in reconstruction. Lederer questions proposals to preserve wartime self-sufficiency through permanently elevated agricultural prices: agriculture cannot indefinitely expand sales while demanding relatively higher prices without corresponding development elsewhere.
The industrial analysis uses accounts, dividends, depreciation, and reserves to identify gains obscured by modest distributions. Concentrating production in favorably situated plants can increase profits, but wartime profitability does not establish peacetime efficiency. Accumulated reserves may also represent capital consumed without replacement. Their nominal value cannot guarantee the future acquisition of equivalent equipment.
Workers and salaried employees occupy a contrasting position. Exceptional munitions wages are an unreliable measure of general welfare; nominal earnings must be compared with prices and the distribution of wage increases. Salaried employees are especially disadvantaged, while most workers accumulate insufficient reserves to obtain lasting command over future production. Entrepreneurial gains can become durable assets, whereas workers’ postwar position depends anew on employment and output.
The distinction between productive wealth and private claims governs Lederer’s account of reconstruction. Even when equipment has been depleted, owners may retain monetary claims upon goods yet to be produced. Reconstruction thus does not begin from a socially neutral position: existing purchasing power helps determine what is produced and who receives it. Liquid wealth may support modernization, but it can also preserve obsolete enterprises or enable withdrawal into rentier income.
The concluding discussion of defeat and revolution retains this framework while stressing the provisional outlook. Agriculture gains further relative strength, and wage increases under continuing capitalist market relations risk being offset by prices and external-trade pressures. Lederer’s contribution is to connect wartime destruction with the redistribution of durable economic power: society’s productive impoverishment can coexist with the consolidation of private claims over its recovery.
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