TMP bookmark: economics of occupying Sweden
Carl Schwamberger wrote: ↑16 Mar 2021 18:40
Now Im contemplating the effects of a second peripheral & preparatory campaign for Op Barabarosa, as well as a broader partisan insurgency in Scandinavia. How long does it take to restore the railways, ports, and other ore extraction infrastructure? What about the sabatoge & general loss of efficiency in SKS production of machine parts. Its easy to say any one of these things is not decisive in itself, & that is absolutely correct. But, economically Germany was dying the death of a thousand cuts & invading yet another neutral steps up the pain and blood loss. They may as well invade Switzerland & Iberia as well & make it a faster suicide.
That's a partial analysis; to complete it you'd have to account for at least (1) economic exploitation of Sweden as occupied country versus neutral, (2) strategic impact of Sweden's occupation on Norway's defense.
Re (1):
Chapter 6: Sweden as an Occupied Country in
Paying for Hitler's War: The Consequences of Nazi Hegemony for Europe contains a price adjusted tally of Swedish-German wartime trade:
With a little arithmetic, we can see that the Germans got KR 654mil more from Sweden than they gave in real prices. As Sweden's 1938 GDP was KR 12.1bn, that's 5.4% of Swedish GDP over '41-'44 or ~1.3% extracted per year. Germany paid for Swedish ore with a lot of chemicals, coal, and other high-value goods:
German economic exploitation would have been much greater had Germany occupied Sweden.
Does Conquest Pay? by Liberman, estimates that Germany extracted, on average, 33% of GDP from Western Europe:
Occupied Sweden would receive far less from Germany than OTL. Meanwhile Germany would use financial methods (clearing accounts, occupation accounts) as efficiently as it did elsewhere to plunder Sweden economically.
So even if Swedish GDP declined from OTL by 1/3, Germany's net and total economic gain from conquering it would be around ~15x higher. Topline economic data cannot, of course, tell you whether an iron ore shortage may result in the window between outbreak of hostilities and restoration of Kiruna's production, but German stocks and feasible substitutes (e.g. more labor in Salzgitter and Alsace mines) should be able to bridge the gap.
Plus Sweden would contribute more workers to Germany's domestic economy if occupied - a factor at least as important as the above analysis.
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Re (2):
Hitler maintained excessive defensive forces in Norway throughout the war due to his awareness that Northern Norway was not easily reinforceable if the Allies attacked. Had Germany occupied Sweden, however, the Norwegian coast is only the forefield of a region with strategic depth and therefore need not hold as many forces as OTL.
In addition, we'd likely see greater Swedish recruitment to the Waffen SS. Norway produced ~6,000, Sweden 100-300.
Sweden had 2.13x as many people as Norway in '40, so Waffen-SS gets ~12k more soldiers if same rate as Norway.
That would easily counterbalance permanent casualties from invading Sweden.
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There is an argument that Germany should have conquered Sweden anyway based on the foregoing factors. There are very good counterarguments based on politics and the impact on, e.g., Finland. If the Allies invade/occupy Kiruna, however, the political repercussions of Germany invasion would have been greatly ameliorated.
