II. The new structure of the German industrial economy
The new structure of the German economy must be based on the assumption that the unrestricted reign of private capitalism has come to an end. Yet we must also prevent private capitalism from being supplanted by state capitalism, which would be even more dangerous for the individual’s political and economic freedoms. A new economic structure must be established, one that avoids past mistakes and opens up the opportunity for technological progress and individual creative initiative.
1. Conglomerates and similar economic entities that are not absolutely necessary for technical, social, or economic reasons must be broken up into independent companies. Due to technological developments, some companies may require a certain minimum size so that, among other things, they can compete effectively with their foreign counterparts. These companies must by all means be allowed to retain this minimum size.
2. Companies that are monopolistic in character or companies that have to exceed a certain size may impart an economic and thus also a political power that can jeopardize freedom in the state. This danger must be eliminated by the passage of appropriate anti-trust laws. Furthermore, these companies must operate under the principle of power-sharing in order to prevent the state, private persons, or groups of people from dominating key branches of the economy, which would be incompatible with the common good.
a) To this end, public bodies such as the state, the individual federal states, local authorities, associations of local authorities, as well as cooperatives and company employees, must all have a stake in these companies. Nevertheless, entrepreneurial initiative is urgently needed and must be given the necessary latitude.
b) Furthermore, legal limits must be placed on the private ownership of stock in these companies so as to prevent the concentration of ownership or voting rights in one hand.
3. Mining: coal mines have a clear monopolistic character simply by virtue of the basic product they extract, which is vital to the entire nation. It is therefore of utmost importance that they be subject to the principles laid out in II.2: they must be nationalized.
If, in special cases, the more advisable legal form for these companies is that of a Staatsbetrieb (state-owned company), the above-mentioned principles must not stand in the way of the adoption of this form.
4. Large-scale iron-producing industry: the large-scale iron-producing industry must also be nationalized.
5. Every effort must be made to expand the cooperative sector, and the legal form of foundations must be strongly promoted in the commercial economy.
6. The legal regulation of the financial and banking system as well as the insurance industry, which already began before 1933, must be further expanded.
7. Efficient small and medium-sized businesses must be promoted on account of their national economic value and the opportunities they offer for social advancement. In industry, commerce, and the skilled trades, private entrepreneurship must be preserved and further promoted.
8. Legally acquired property that was not used in a politically abusive manner must be respected within the framework of general laws when this new economic order is implemented.
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