A second crucial difference consisted in the degree of control over life chances. The Nazi economy was not owned or even managed by the state. Many banks that had been nationalized during the Depression had been reprivatized in 1936–37, and, aside from the Hermann Göring Works (low-quality iron ore), the Nazi regime created few state enterprises. A robust finance ministry opposed state companies as inefficient and expensive. Private companies that refused ministerial directives suffered no consequences. To be sure, plenty of incentives existed for private business to curry favor with the regime, and foreign policy considerations also shaped private investment (one quarter of the labor force worked in industry directly connected with weapons). Still, freedom of contract was preserved as enterprises continued to select their own customers. Private corporate profits had risen 400 percent higher than they had been a decade earlier. Hitler and his regime viewed private property, entrepreneurship, and market incentives as valued instruments for the advance of the German race.326 Stalin himself explained to the Soviet government notetaker that bourgeois states “have not absorbed the economic organizations, but our state is not only a political organization but an economic one.”327 His point was that the absence of private companies (and legal markets) had created a complex and difficult challenge of management; but it also meant the Soviet state was the only employer, the only source of housing, the only arbiter of schooling for one’s children, the only provider—or not—of a host of necessities and amenities. The possibility of self-employment, a private housing market, private religious schools, and private holiday resorts provided for significantly less life control over non-Jews under Nazism.
All that said, the two regimes did share a crucial attribute: personal rule. The Pact had been made possible not by an affinity between the regimes but by the two leaders’ unquestioned authority. Hitler and Stalin had no need to worry about parliamentary majorities, genuine ratification votes, a free press, or even independent voices in the inner circle, giving each an absolute freedom to act.328 They did so because of a temporary confluence of interests against Britain and the Versailles offspring, Poland, engaging in a parallel, if differing, revisionism. In his most revealing comment on the Pact (made later to a British official), Stalin would explain that “the USSR had wanted to change the old equilibrium. . . . England and France had wanted to preserve it. Germany had also wanted to make a change in the equilibrium, and this common desire to get rid of the old equilibrium had created the basis for rapprochement with Germany.”329
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FROM LATE AUGUST through late September 1939, Stalin had the month of a lifetime, convincingly winning a major border war against Japan and obtaining a sweetheart deal with Hitler. Mekhlis, the despot’s mouthpiece, had boasted at the 18th Party Congress, in March 1939, that in the event of the outbreak of a “second imperialist war,” the Red Army would “carry the battle to the territories of the enemy and fulfill its international duty to increase the number of Soviet republics.”330 In truth, Stalin had lacked the confidence and the external facilitation for such expansionism on his own. Hitler was driving world politics. Stalin presented him a draft pact that greatly favored the Soviet side, and Hitler took it.331 Stalin was an opportunist, and Hitler had opened the door.332 Chamberlain, rightly fearing Soviet expansionism in Europe, had nonetheless helped push the Soviet despot through that very door of expansionism by not only rejecting Stalin’s offer of a genuine military alliance but playing charades with him. Perhaps Stalin would have agreed to a deal with the Western powers if he had faced a certain imminent British-German agreement at his expense, but Chamberlain would have taken the German deal instead. Hitler, for his part, had done something remarkable: he had scorned Chamberlain’s July 1939 feelers to double-cross Poland in a repeat of Munich.333