WEBVTT 00:00:00.000 --> 00:00:03.600 In the early 1930s, if you wanted to fund the 00:00:03.600 --> 00:00:06.379 most violent paramilitary group in Germany, you 00:00:06.379 --> 00:00:08.199 didn't actually have to buy a weapon. Right. 00:00:08.619 --> 00:00:10.539 No black market deals required. Yeah. You didn't 00:00:10.539 --> 00:00:12.179 have to launder money through a Swiss betting 00:00:12.179 --> 00:00:14.960 account or, you know, smuggle gold across a border. 00:00:15.279 --> 00:00:17.059 You just had to walk into a corner store and 00:00:17.059 --> 00:00:19.120 buy a cheap pack of cigarettes. A brand called 00:00:19.120 --> 00:00:23.239 Trommler specifically. Exactly. And it completely 00:00:23.239 --> 00:00:26.179 upends our standard perception of how extremist 00:00:26.179 --> 00:00:28.839 movements build their war chests. Oh, absolutely. 00:00:29.260 --> 00:00:31.960 I mean, we are so conditioned to look for grand 00:00:31.960 --> 00:00:34.500 dramatic villainy in the ledger books. Yeah. 00:00:34.759 --> 00:00:37.640 But we rarely look at the mundane everyday habits 00:00:37.640 --> 00:00:39.960 of the standard consumer. Which is exactly why 00:00:39.960 --> 00:00:42.140 today's source material is so fascinating. We 00:00:42.140 --> 00:00:44.640 are taking a deep dive into an excerpted Wikipedia 00:00:44.640 --> 00:00:47.700 article about a defunct company from 1920s and 00:00:47.700 --> 00:00:50.399 30s Germany. The Sturm Cigarette Company. Right. 00:00:50.979 --> 00:00:54.170 And our mission for this deep dive. is to explore 00:00:54.170 --> 00:00:56.590 how a completely ordinary, everyday consumer 00:00:56.590 --> 00:00:59.689 good was literally weaponized. Basically used 00:00:59.689 --> 00:01:02.149 to fund and fuel a paramilitary organization. 00:01:02.490 --> 00:01:05.189 Specifically the SA. The Sturmabteilung, which 00:01:05.189 --> 00:01:07.890 was the original paramilitary wing of the Nazi 00:01:07.890 --> 00:01:11.109 party. Yeah. And before we get into the actual 00:01:11.109 --> 00:01:13.430 mechanics of this, I want to make something very, 00:01:13.430 --> 00:01:15.890 very clear to you, our listeners. Very important 00:01:15.890 --> 00:01:19.650 point here. Right. Because our source deals with 00:01:19.650 --> 00:01:23.159 the Nazi party and the SA. We are explicitly 00:01:23.159 --> 00:01:26.140 stating that our goal today is absolutely not 00:01:26.140 --> 00:01:30.359 to endorse or validate or make light of any viewpoints 00:01:30.359 --> 00:01:33.340 or ideologies of these historical figures. Definitely 00:01:33.340 --> 00:01:36.900 not. Our purpose is purely to impartially analyze 00:01:36.900 --> 00:01:39.280 the historical mechanics detailed in the source 00:01:39.280 --> 00:01:42.269 material. We want to understand how politics 00:01:42.269 --> 00:01:45.409 and consumerism violently intersected. Right. 00:01:45.609 --> 00:01:47.969 So we can recognize the architecture of coercion 00:01:47.969 --> 00:01:50.390 but without in any way endorsing the actors involved. 00:01:50.709 --> 00:01:52.569 Exactly. Okay, let's unpack this. If we think 00:01:52.569 --> 00:01:54.670 about how this actually functioned, it wasn't 00:01:54.670 --> 00:01:56.709 like a voluntary political fundraiser. No, not 00:01:56.709 --> 00:01:59.969 at all. Imagine a violent political militia launching 00:01:59.969 --> 00:02:02.510 a consumer lifestyle brand just to keep the lights 00:02:02.510 --> 00:02:04.549 on. It's almost like, I don't know, like a street 00:02:04.549 --> 00:02:06.650 gang running a hyper aggressive branded bake 00:02:06.650 --> 00:02:09.530 sale. That is a wild image, but it's incredibly 00:02:09.530 --> 00:02:12.009 apt. Yeah. Yeah. But to really understand how 00:02:12.009 --> 00:02:14.990 a political militia ended up in the tobacco manufacturing 00:02:14.990 --> 00:02:17.650 business, we first have to look at the sheer 00:02:17.650 --> 00:02:21.800 economic desperation of late 1920s Germany. Right. 00:02:21.979 --> 00:02:24.659 The context is everything here. Exactly. The 00:02:24.659 --> 00:02:27.219 essay was essentially the muscle of the Nazi 00:02:27.219 --> 00:02:30.400 party. But, you know, muscle requires funding. 00:02:30.719 --> 00:02:33.340 Always does. And at this specific point in time, 00:02:33.740 --> 00:02:36.319 the essay actually charged no membership fees 00:02:36.319 --> 00:02:39.650 to its recruits. Wait, no fees at all? So how 00:02:39.650 --> 00:02:41.629 were they surviving? I mean, if you have thousands 00:02:41.629 --> 00:02:43.349 of men marching around, you have to feed them. 00:02:43.430 --> 00:02:45.229 You have to clothe them. Right. And house them. 00:02:45.229 --> 00:02:47.469 They were entirely dependent on handouts. From 00:02:47.469 --> 00:02:49.550 the party. Yeah. Structural donations from the 00:02:49.550 --> 00:02:52.650 Nazi party leadership. But the party itself was 00:02:52.650 --> 00:02:55.250 constantly stretched thin. They were essentially 00:02:55.250 --> 00:02:58.490 broke. Wow. OK, so where do cigarettes come in? 00:02:58.629 --> 00:03:00.550 Well, meanwhile, you have the broader German 00:03:00.550 --> 00:03:02.810 cigarette market. Following the First World War, 00:03:02.990 --> 00:03:05.430 a lot of the smaller independent cigarette firms 00:03:05.430 --> 00:03:07.750 had totally collapsed. It was basically a monopoly. 00:03:07.960 --> 00:03:11.240 Pretty much. The market had become heavily consolidated. 00:03:11.659 --> 00:03:14.879 It was dominated by a few massive, highly automated 00:03:14.879 --> 00:03:17.360 corporate monopolies. At the time, they were 00:03:17.360 --> 00:03:19.780 known as the concern or the combine. Right, the 00:03:19.780 --> 00:03:23.360 trust. And the Nazi party was already leveraging 00:03:23.360 --> 00:03:26.360 that economic anxiety, right? Because they were 00:03:26.360 --> 00:03:28.680 actively attacking this consolidated tobacco 00:03:28.680 --> 00:03:31.000 industry in their propaganda. They were claiming 00:03:31.000 --> 00:03:33.379 it had, you know, foreign and Jewish connections. 00:03:33.680 --> 00:03:37.000 Yes. They are loudly denouncing the very concept 00:03:37.000 --> 00:03:38.939 of these corporate monopolies. Right. Making 00:03:38.939 --> 00:03:42.080 them the bad guys. Exactly. But simultaneously, 00:03:42.240 --> 00:03:44.539 they're staring at an empty bank account. They 00:03:44.539 --> 00:03:46.800 realize they desperately need an independent 00:03:46.800 --> 00:03:51.280 massive income source. Which brings a very opportunistic 00:03:51.280 --> 00:03:53.680 entrepreneur out of the woodwork. Yes. Arthur 00:03:53.680 --> 00:03:56.680 Dressler. Right. So in 1929, this guy Dressler 00:03:56.680 --> 00:03:59.620 approaches the essay with a pitch. He essentially 00:03:59.620 --> 00:04:02.219 says, look, you have tens of thousands of loyal 00:04:02.219 --> 00:04:05.629 men Let's found a cigarette manufacturer together 00:04:05.629 --> 00:04:08.330 a joint venture. Yeah He says your SA members 00:04:08.330 --> 00:04:11.310 will exclusively smoke our product and in exchange 00:04:11.310 --> 00:04:14.289 the SA gets a royalty on every single pack sold 00:04:14.699 --> 00:04:17.500 Dressler was basically proposing a captive market. 00:04:17.740 --> 00:04:20.180 A completely captive market. And the specific 00:04:20.180 --> 00:04:23.300 royalty rate he pitched was between 15 and 20 00:04:23.300 --> 00:04:26.540 fennig for every thousand cigarettes sold. Wait, 00:04:26.620 --> 00:04:28.639 wait. Let's look at that math for a second. If 00:04:28.639 --> 00:04:30.699 cigarettes are selling for just a few fennigs 00:04:30.699 --> 00:04:34.459 each, a 15, 20 fennig return on a thousand cigarettes 00:04:34.459 --> 00:04:38.360 is, I mean, it's microscopic. It is. It's fractions 00:04:38.360 --> 00:04:40.899 of a percent. So how does that possibly fund 00:04:40.899 --> 00:04:43.790 a paramilitary army? If we connect this to the 00:04:43.790 --> 00:04:46.509 bigger picture, it relies entirely on staggering 00:04:46.509 --> 00:04:49.189 volume. Volume. Yeah. Dressler understood that 00:04:49.189 --> 00:04:52.230 if you mandate consumption across a rapidly growing 00:04:52.230 --> 00:04:55.670 fanatic base, those fractions of a penny accumulate 00:04:55.670 --> 00:04:58.449 into millions of marks. That makes sense. But 00:04:58.449 --> 00:05:01.069 I mean, an idea doesn't build an industrial factory. 00:05:01.389 --> 00:05:03.930 It certainly doesn't. You can't manufacture billions 00:05:03.930 --> 00:05:05.870 of cigarettes with just a handshake agreement. 00:05:06.410 --> 00:05:08.870 You need heavy industrial capital. Which the 00:05:08.870 --> 00:05:11.470 essay absolutely did not have. Right. Our source 00:05:11.470 --> 00:05:13.490 details the initial financials for this venture. 00:05:14.110 --> 00:05:15.870 They officially registered it as the Cigarette 00:05:15.870 --> 00:05:18.230 and Fabric Drethler, though it became known as 00:05:18.230 --> 00:05:20.370 Zigaret and Firma Sturm. The Sturm Cigarette 00:05:20.370 --> 00:05:23.649 Company. Yeah. So the Nazi Party leadership offered 00:05:23.649 --> 00:05:27.170 30 ,000 Reichsmarks in startup money. Which, 00:05:27.269 --> 00:05:29.569 for setting up an automated manufacturing operation 00:05:29.569 --> 00:05:32.430 to compete with corporate giants, 30 ,000 marks 00:05:32.430 --> 00:05:34.930 is practically an insult. Oh, it wouldn't even 00:05:34.930 --> 00:05:37.250 cover the cost of the industrial rolling machinery. 00:05:37.470 --> 00:05:40.389 Let alone the raw tobacco leaf. Exactly. Or the 00:05:40.389 --> 00:05:42.629 warehouse space or the distribution network. 00:05:42.810 --> 00:05:45.610 It was nothing. So they needed a massive bailout 00:05:45.610 --> 00:05:48.370 on day one. They really did. And a Nazi party 00:05:48.370 --> 00:05:50.589 supporter named Jacques Bettenhausen. had to 00:05:50.589 --> 00:05:55.050 step in. He injected a staggering 500 ,000 Reichsmarks. 00:05:55.129 --> 00:05:58.029 Half a million marks? Yeah. That injection wasn't 00:05:58.029 --> 00:06:00.990 just a friendly donation. It was the heavy industrial 00:06:00.990 --> 00:06:03.310 capital that actually took this from a theoretical 00:06:03.310 --> 00:06:06.569 grift to a viable factory. Completely. Without 00:06:06.569 --> 00:06:08.689 Bettenhausen's capital, the Sturm Cigarette Company 00:06:08.689 --> 00:06:11.430 would never have existed. Right. He bankrolled 00:06:11.430 --> 00:06:14.329 the infrastructure necessary to actually monetize 00:06:14.329 --> 00:06:16.990 the SA's base. But I have to push back here because 00:06:16.990 --> 00:06:19.629 this underlying business strategy still seems 00:06:19.470 --> 00:06:22.110 fundamentally flawed to me. How so? Well we're 00:06:22.110 --> 00:06:25.009 talking about the late 1920s and early 1930s. 00:06:25.230 --> 00:06:27.810 The Great Depression is ravaging the globe. True. 00:06:28.050 --> 00:06:30.550 Unemployment in Germany was skyrocketing. It 00:06:30.550 --> 00:06:34.470 eventually peaked over 30%. And the SA specifically 00:06:34.470 --> 00:06:37.449 recruited heavily from these unemployed desperate 00:06:37.449 --> 00:06:40.209 young men. They did. So if your entire consumer 00:06:40.209 --> 00:06:42.870 base is flat broke, why are you trying to sell 00:06:42.870 --> 00:06:46.170 them a consumer product like cigarettes? Well... 00:06:46.329 --> 00:06:48.189 Again, if we connect this to the bigger picture, 00:06:48.449 --> 00:06:50.209 we really have to shed our modern perception 00:06:50.209 --> 00:06:53.850 of cigarettes as a discretionary luxury. In the 00:06:53.850 --> 00:06:57.389 culture of 1920s Germany, tobacco was a heavily 00:06:57.389 --> 00:07:00.089 ingrained, almost physiological necessity for 00:07:00.089 --> 00:07:02.610 these men. It wasn't optional. No. A typical 00:07:02.610 --> 00:07:05.550 German smoker at the time consumed about 15 cigarettes 00:07:05.550 --> 00:07:08.500 a day. Wow. So it isn't a treat they buy when 00:07:08.500 --> 00:07:11.439 they have extra cash. It's a baseline daily requirement. 00:07:11.860 --> 00:07:14.000 Precisely. And the economic data from the period 00:07:14.000 --> 00:07:17.019 is staggering. Even an average intensity smoker 00:07:17.019 --> 00:07:19.680 buying the absolute cheapest brand available 00:07:19.680 --> 00:07:22.259 would spend about one -tenth of their entire 00:07:22.259 --> 00:07:24.519 gross income on cigarettes. Ten percent. Ten 00:07:24.519 --> 00:07:26.360 percent. I mean, let that sink in for a moment 00:07:26.360 --> 00:07:29.879 for you listening right now. Imagine taking ten 00:07:29.879 --> 00:07:32.250 percent of your gross monthly paycheck. before 00:07:32.250 --> 00:07:35.470 taxes, before rent, before groceries, and being 00:07:35.470 --> 00:07:37.509 chemically and politically compelled to spend 00:07:37.509 --> 00:07:41.149 it on a single consumable product. It's terrifying, 00:07:41.370 --> 00:07:43.670 but it illustrates the raw power of the addiction 00:07:43.670 --> 00:07:46.540 model. Yeah. For the essay. Nicotine edition 00:07:46.540 --> 00:07:49.480 provided a guaranteed recurring revenue stream. 00:07:49.699 --> 00:07:52.120 They didn't even have to ask for donations. Exactly. 00:07:52.319 --> 00:07:55.180 It bypassed the need for voluntary donations. 00:07:55.579 --> 00:07:59.040 It extracted a tiny non -negotiable tax from 00:07:59.040 --> 00:08:02.079 hundreds of thousands of men day after day. But 00:08:02.079 --> 00:08:04.660 having an addictive product in a factory doesn't 00:08:04.660 --> 00:08:07.480 automatically equal market dominance. The essay 00:08:07.480 --> 00:08:10.199 still had to convince or I guess more accurately, 00:08:10.879 --> 00:08:13.079 force the population to abandon their preferred 00:08:13.079 --> 00:08:15.300 brands and buy Sturm cigarettes instead. Right. 00:08:15.319 --> 00:08:17.399 And they were going up against huge established 00:08:17.399 --> 00:08:19.899 brands. So how did they actually structure this 00:08:19.899 --> 00:08:22.720 product line to capture a totally destitute market? 00:08:22.939 --> 00:08:25.740 They utilized a highly calculated psychological 00:08:25.740 --> 00:08:28.319 and economic market segmentation. Meaning they 00:08:28.319 --> 00:08:31.389 didn't just sell one type. Exactly. The factory 00:08:31.389 --> 00:08:34.529 didn't just produce one generic cigarette. They 00:08:34.529 --> 00:08:38.429 produced four main brands, tiered by price, to 00:08:38.429 --> 00:08:41.629 capture every possible sliver of their impoverished 00:08:41.629 --> 00:08:43.629 base. OK, let's break down that pricing tier, 00:08:43.929 --> 00:08:46.269 because it reveals exactly how bad the economic 00:08:46.269 --> 00:08:49.009 crisis was. You had their premium brand called 00:08:49.009 --> 00:08:51.490 New Front, or New Front, which was the most expensive 00:08:51.490 --> 00:08:53.809 at six fenig a cigarette. Right. Then you had 00:08:53.809 --> 00:08:57.210 Sturm, meaning storm, at five fenig, alarm at 00:08:57.210 --> 00:09:00.340 four fenig, and at the very bottom, Trommler, 00:09:00.679 --> 00:09:02.639 or Drummer, which was the absolute cheapest at 00:09:02.639 --> 00:09:05.299 three and a third Fennig. And the sales data 00:09:05.299 --> 00:09:07.620 perfectly reflects the crushing reality of the 00:09:07.620 --> 00:09:09.860 Great Depression, the premium brands. They were 00:09:09.860 --> 00:09:12.120 essentially window dressing. Nobody was buying 00:09:12.120 --> 00:09:14.820 the six Fennig ones. Exactly. The source notes 00:09:14.820 --> 00:09:18.580 that in 1932, a massive 80 % of all Sturm cigarettes 00:09:18.580 --> 00:09:21.139 sold were the dirt cheap Trommler brand. Fee 00:09:21.139 --> 00:09:23.379 percent. Yeah. And as the economy worsened into 00:09:23.379 --> 00:09:26.840 1933, that jumped to 95%. So they were running 00:09:26.840 --> 00:09:29.320 a volume business on the absolute poorest segment 00:09:29.320 --> 00:09:33.740 of society. But they didn't just rely on cheap 00:09:33.740 --> 00:09:36.220 prices. The marketing machine they built around 00:09:36.220 --> 00:09:39.159 Trommler and the other brands was incredibly 00:09:39.159 --> 00:09:41.779 aggressive. Oh, yeah. The source talks about 00:09:41.779 --> 00:09:44.159 how they had dedicated sound trucks driving through 00:09:44.159 --> 00:09:46.879 neighborhoods just blaring advertisements. It 00:09:46.879 --> 00:09:49.460 was inescapable. They even hired planes to drop 00:09:49.460 --> 00:09:52.080 leaflets or fly banners overhead. And the messaging 00:09:52.080 --> 00:09:55.080 itself was pure concentrated political reasons. 00:09:55.379 --> 00:09:58.559 They explicitly weaponized the economic anxiety 00:09:58.559 --> 00:10:02.039 of the era. Their early advertising heavily featured 00:10:02.039 --> 00:10:05.039 the slogan, against the trust and the combine. 00:10:05.379 --> 00:10:07.320 Directly attacking those established corporate 00:10:07.320 --> 00:10:10.100 monopolies we discussed earlier. Exactly. During 00:10:10.100 --> 00:10:12.779 the worst of the economic crash, between 1930 00:10:12.779 --> 00:10:16.120 and 1932, their print ads frequently depicted 00:10:16.120 --> 00:10:19.200 catastrophic situations. They were visually linking 00:10:19.200 --> 00:10:21.620 the failure of the German economy to the rival 00:10:21.620 --> 00:10:23.600 tobacco corporations. And then there was the 00:10:23.600 --> 00:10:26.159 physical packaging itself. Inside the cigarette 00:10:26.159 --> 00:10:28.419 packs, they included collectible sets of images 00:10:28.419 --> 00:10:30.879 featuring historical German military uniforms. 00:10:30.919 --> 00:10:32.980 Right, like baseball cards, but for militarism. 00:10:33.220 --> 00:10:36.039 Which seems like a strange prize for a political 00:10:36.039 --> 00:10:38.879 party's quote -unquote sports and gymnastics 00:10:38.879 --> 00:10:41.440 division. Well, the sports and gymnastics label 00:10:41.440 --> 00:10:45.659 was a very thin legal fiction. The SA used it 00:10:45.659 --> 00:10:47.779 to avoid being banned by the government. Right. 00:10:47.919 --> 00:10:50.399 In reality, they were actively promoting themselves 00:10:50.399 --> 00:10:53.960 as a massive shadow military training program. 00:10:54.440 --> 00:10:56.700 Now the source mentions the essay framed themselves 00:10:56.700 --> 00:10:59.639 as the successor to the band, Fracor Malicious. 00:10:59.759 --> 00:11:02.679 Yes. What exactly were the Fracor, and why does 00:11:02.679 --> 00:11:04.740 putting their uniforms on collectible cigarette 00:11:04.740 --> 00:11:07.809 cards actually matter. So the Freikorps were 00:11:07.809 --> 00:11:11.230 rogue right wing paramilitary units composed 00:11:11.230 --> 00:11:14.029 of bitter veterans that formed immediately after 00:11:14.029 --> 00:11:16.990 Germany lost the First World War. They were notoriously 00:11:16.990 --> 00:11:19.250 violent and eventually they were banned by the 00:11:19.250 --> 00:11:21.269 Weimar Republic. So they were basically violent 00:11:21.269 --> 00:11:24.909 outlaws. Yes. And by including collectible cards 00:11:24.909 --> 00:11:27.590 of historical military and Freikorps uniforms 00:11:27.590 --> 00:11:30.509 the SA was psychologically grooming its consumers. 00:11:30.649 --> 00:11:32.549 Normalizing the violence. Right. They were making 00:11:32.549 --> 00:11:35.710 the prospect of militarization and in a violent 00:11:35.710 --> 00:11:39.269 street army look glorious and historically validated. 00:11:39.690 --> 00:11:41.830 Here's where it gets really interesting. They 00:11:41.830 --> 00:11:45.210 are building this brand loyalty through psychological 00:11:45.210 --> 00:11:48.850 grooming, but they didn't actually trust their 00:11:48.850 --> 00:11:51.970 members to willingly buy the product. No, trust 00:11:51.970 --> 00:11:53.889 was not part of the equation. This wasn't just 00:11:53.889 --> 00:11:57.250 a marketing campaign. It was literal mafia -style 00:11:57.250 --> 00:12:00.279 racketeering. The source makes it abundantly 00:12:00.279 --> 00:12:03.480 clear. SA members were compelled to smoke Sturm 00:12:03.480 --> 00:12:06.019 cigarettes under threat of physical and financial 00:12:06.019 --> 00:12:08.899 punishment. It was an internal mandate, enforced 00:12:08.899 --> 00:12:11.460 through systematic humiliation and penalization. 00:12:11.659 --> 00:12:14.200 Bag searches, right. Exactly. If you were a member 00:12:14.200 --> 00:12:16.940 of the SA, your superiors would conduct unannounced 00:12:16.940 --> 00:12:19.720 bag and pocket searches. Wow. And if they found 00:12:19.720 --> 00:12:22.200 a rival brand of cigarettes on you, you weren't 00:12:22.200 --> 00:12:25.360 just scolded. You were hit with a stripped financial 00:12:25.360 --> 00:12:27.919 fine. Imagine your employer demanding to search 00:12:27.919 --> 00:12:30.000 your pockets to ensure you're only consuming 00:12:30.000 --> 00:12:32.539 the company's proprietary product and then docking 00:12:32.539 --> 00:12:34.679 your pay if you bought a competitor's brand. 00:12:34.860 --> 00:12:37.779 It's unbelievable. It is a closed loop of extortion. 00:12:38.279 --> 00:12:40.460 But the coercion didn't stay internal, did it? 00:12:40.659 --> 00:12:42.539 They took this violent enforcement out into the 00:12:42.539 --> 00:12:44.779 public market. They really treated the free market 00:12:44.779 --> 00:12:48.179 as a literal battlefield. Right. The SA actively 00:12:48.179 --> 00:12:50.519 agitated against the use of other brands by the 00:12:50.519 --> 00:12:53.919 general public, and they reserved a special targeted 00:12:53.919 --> 00:12:57.159 hostility for the actual market leader. A massive 00:12:57.159 --> 00:13:00.639 tobacco corporation called Riemsma. Yes, Riesmaes. 00:13:00.799 --> 00:13:02.960 And they didn't just write angry op -eds about 00:13:02.960 --> 00:13:06.519 Riemsma. SA men physically attacked the retail 00:13:06.519 --> 00:13:09.639 shops that dared to stock Riemsma products. Physical 00:13:09.639 --> 00:13:12.789 violence. They smashed storefront windows. They 00:13:12.789 --> 00:13:15.370 drag shop workers out and physically beat them 00:13:15.370 --> 00:13:19.450 in the streets. This is violent market monopolization, 00:13:19.750 --> 00:13:22.169 disguised as a grassroots political boycott. 00:13:22.470 --> 00:13:24.509 They were using paramilitary street violence 00:13:24.509 --> 00:13:26.789 to artificially inflate their own market share. 00:13:27.049 --> 00:13:28.629 And to terrorize their corporate rivals into 00:13:28.629 --> 00:13:30.769 submission. Exactly. OK, I have to stop us here 00:13:30.769 --> 00:13:33.860 for a second, because Anyone who knows even a 00:13:33.860 --> 00:13:36.059 little bit about this era is probably screaming 00:13:36.059 --> 00:13:38.059 at their audio player right now. I know exactly 00:13:38.059 --> 00:13:40.539 what you're gonna say. Right. There is a massive 00:13:40.539 --> 00:13:42.820 historical contradiction staring us right in 00:13:42.820 --> 00:13:45.700 the face. Yeah. It is heavily documented that 00:13:45.700 --> 00:13:49.240 Adolf Hitler was famously rabidly anti -smoking. 00:13:49.600 --> 00:13:52.720 Oh, he despised the habit. So how does a violently 00:13:52.720 --> 00:13:56.059 enforced state -sponsored tobacco monopoly thrive 00:13:56.059 --> 00:13:58.460 under a dictator who actively hates the very 00:13:58.460 --> 00:14:00.799 product they are selling? It highlights the profound 00:14:00.799 --> 00:14:03.960 disconnect between a dictator's ideological purity 00:14:03.960 --> 00:14:06.740 and a state apparatus's pragmatic, desperate 00:14:06.740 --> 00:14:10.159 need for revenue. Money talks. Always. You are 00:14:10.159 --> 00:14:13.259 entirely correct. Hitler detested smoking. He 00:14:13.259 --> 00:14:16.179 even ordered localized bans across party offices 00:14:16.179 --> 00:14:19.220 in certain public spaces. But the source explicitly 00:14:19.220 --> 00:14:21.799 notes those bans were widely ignored. How do 00:14:21.799 --> 00:14:24.440 you ignore a dictator's mandate in an authoritarian 00:14:24.440 --> 00:14:27.519 regime? Because the entity guarding the Treasury, 00:14:27.639 --> 00:14:30.720 the Finance Ministry, vetoed the ideology. The 00:14:30.720 --> 00:14:33.379 bean counters won. They did. The Finance Ministry 00:14:33.379 --> 00:14:36.080 absolutely loved the tax revenue that tobacco 00:14:36.080 --> 00:14:39.159 generated. To understand the scale, by 1941, 00:14:39.820 --> 00:14:42.019 roughly one -twelfth of the entire German state 00:14:42.019 --> 00:14:44.500 revenue came exclusively from tobacco taxes. 00:14:44.720 --> 00:14:47.139 Over 8 % of the national budget. Exactly. You 00:14:47.139 --> 00:14:49.139 don't just turn off 8 % of a nation's income 00:14:49.139 --> 00:14:51.679 because the leader finds the smell distasteful? 00:14:52.190 --> 00:14:54.309 especially not when you're actively rearming 00:14:54.309 --> 00:14:57.230 for a global war? Furthermore, Joseph Goebbels, 00:14:57.330 --> 00:14:59.789 the propaganda minister, fundamentally disagreed 00:14:59.789 --> 00:15:02.230 with Hitler on this issue, and Goebbels' view 00:15:02.230 --> 00:15:05.179 ultimately dictated state policy. What did Goble 00:15:05.179 --> 00:15:07.720 think? He believed that cigarettes were absolutely 00:15:07.720 --> 00:15:10.019 essential to the psychological endurance of the 00:15:10.019 --> 00:15:13.000 war effort. They were deemed so vital for morale 00:15:13.000 --> 00:15:15.600 that they were distributed for free to soldiers 00:15:15.600 --> 00:15:18.159 as a designated part of their rations. Even to 00:15:18.159 --> 00:15:20.039 miners, right? Yes, even to miners serving in 00:15:20.039 --> 00:15:22.259 the military. The result of the state actively 00:15:22.259 --> 00:15:25.419 pushing this addictive substance is just staggering. 00:15:26.620 --> 00:15:30.139 The source says between 1930 and 1940, the per 00:15:30.139 --> 00:15:32.580 capita cigarette consumption in Germany literally 00:15:32.580 --> 00:15:34.779 doubled. Double in 10 years. It went from 500 00:15:34.779 --> 00:15:37.419 cigarettes a year per person to 1 ,000. They 00:15:37.419 --> 00:15:39.980 were selling tens of billions of cigarettes annually. 00:15:40.399 --> 00:15:43.980 And in the early 1930s, the SA's Sturm Cigarette 00:15:43.980 --> 00:15:46.779 Company was riding the crest of that wave. By 00:15:46.779 --> 00:15:50.259 1932, Sturm had achieved a massive turnover of 00:15:50.259 --> 00:15:54.179 36 million Reichsmarks. 36 million. Just to put 00:15:54.179 --> 00:15:55.700 that in perspective, that is roughly equivalent 00:15:55.700 --> 00:15:58.620 to 148 million euros today. It was a fortune. 00:15:58.980 --> 00:16:01.580 A typical SA local unit was earning hundreds 00:16:01.580 --> 00:16:04.700 of marks every single month just from their cut 00:16:04.700 --> 00:16:06.679 of the royalties. It was a massive financial 00:16:06.679 --> 00:16:10.480 triumph. Huge. But that exact success, achieved 00:16:10.480 --> 00:16:13.200 by literally throwing bricks through their competitors' 00:16:13.519 --> 00:16:16.769 windows, put a giant target on the S .A.'s back. 00:16:17.029 --> 00:16:18.970 The corporate titans they were trying to destroy 00:16:18.970 --> 00:16:21.450 were paying attention. Right, which introduces 00:16:21.450 --> 00:16:24.649 the pivotal figure of Philip Furkegot Riemsma. 00:16:24.870 --> 00:16:28.110 The head of the rival tobacco combine that the 00:16:28.110 --> 00:16:30.690 S .A. had been physically terrorizing. Exactly. 00:16:31.049 --> 00:16:34.330 And Riemsma is a ruthless corporate pragmatist. 00:16:34.470 --> 00:16:37.159 He's watching his shop windows shatter. But maybe 00:16:37.159 --> 00:16:39.700 more importantly, he's watching his massive advertising 00:16:39.700 --> 00:16:42.720 campaigns get banned from all Nazi Party publications 00:16:42.720 --> 00:16:45.059 by essay sympathizers. Right, they were freezing 00:16:45.059 --> 00:16:47.360 him out of the market. So what does a powerful 00:16:47.360 --> 00:16:49.580 corporate titan do when street thugs disrupt 00:16:49.580 --> 00:16:52.720 his monopoly? He goes over their heads and buys 00:16:52.720 --> 00:16:54.840 the politicians who hold the thugs' leashes. 00:16:55.039 --> 00:16:57.700 What a classic move. In June 1932, Remembrance 00:16:57.700 --> 00:16:59.419 was secured as a face -to -face meeting with 00:16:59.419 --> 00:17:02.279 Adolf Hitler, Rudolf Hess, and Max Ehmann, who 00:17:02.279 --> 00:17:04.460 is Hitler's secretary and the head of the party's 00:17:04.460 --> 00:17:06.869 printing house. And the leverage in this meeting 00:17:06.869 --> 00:17:10.269 is purely financial. How so? The Nazi party's 00:17:10.269 --> 00:17:13.349 publications are hemorrhaging money because Remos' 00:17:13.589 --> 00:17:16.490 lucrative ads are banned. Right. The party is 00:17:16.490 --> 00:17:19.230 also desperate for immense amounts of cash for 00:17:19.230 --> 00:17:22.609 upcoming election campaigns. Rinsma, conversely, 00:17:22.970 --> 00:17:25.809 needs the street violence to end and his advertisements 00:17:25.809 --> 00:17:29.349 to run. It's a mutual need. But the source notes 00:17:29.349 --> 00:17:32.089 that Hitler reportedly scolded Riemsma during 00:17:32.089 --> 00:17:34.549 this meeting for having Jewish business partners. 00:17:34.569 --> 00:17:37.210 He did. Yet they still walk out with a deal. 00:17:37.849 --> 00:17:40.269 Ideological grandstanding immediately yielded 00:17:40.269 --> 00:17:42.589 to capital. Despite the scolding, they struck 00:17:42.589 --> 00:17:44.849 an initial deal for half a million marks worth 00:17:44.849 --> 00:17:48.150 of advertising in party papers. Wow. Yeah, Riemsma 00:17:48.150 --> 00:17:50.170 essentially bought his way back into the market. 00:17:50.390 --> 00:17:52.690 But the payoffs escalated to an almost comical 00:17:52.690 --> 00:17:55.930 degree once the Nazis actually seized state power. 00:17:57.400 --> 00:18:01.480 By 1933, Rimsma realizes he needs permanent protection. 00:18:01.700 --> 00:18:03.740 So he goes straight to Herman Goering, who was 00:18:03.740 --> 00:18:05.859 then the highest official in Prussia. Rimsma 00:18:05.859 --> 00:18:08.160 complains about the ongoing SA Street violence 00:18:08.160 --> 00:18:10.539 against his company, and he also mentions some 00:18:10.539 --> 00:18:13.000 pesky corruption charges he's personally facing 00:18:13.000 --> 00:18:15.640 from state prosecutors. And Goering's response 00:18:15.640 --> 00:18:18.519 is a master class in autocratic corruption. Tell 00:18:18.519 --> 00:18:21.059 me about it. He casually quashes the court cases 00:18:21.059 --> 00:18:25.410 against Rimsma in early 1934. and the price for 00:18:25.410 --> 00:18:31.690 that absolute legal immunity. Three million marks. 00:18:32.029 --> 00:18:34.430 Three million marks to make a federal investigation 00:18:34.430 --> 00:18:37.950 just disappear. Yes. Plus an ongoing mandated 00:18:37.950 --> 00:18:40.630 bribe of one million marks every single year. 00:18:40.769 --> 00:18:43.789 It's breathtaking how cheaply the anti -corporate 00:18:43.789 --> 00:18:46.329 ideology of the party was bought out by the very 00:18:46.329 --> 00:18:49.190 corporations they claim to despise. Which creates 00:18:49.190 --> 00:18:52.069 this unsustainable explosive tension within the 00:18:52.069 --> 00:18:53.430 state. Right. You have the corporate elites, 00:18:53.589 --> 00:18:56.049 like Riamsma, paying massive bribes directly 00:18:56.049 --> 00:18:59.230 to the highest political elites, Hitler, Hasker, 00:18:59.079 --> 00:19:02.539 But down on the street level, the paramilitary 00:19:02.539 --> 00:19:05.460 grunts of the SA are still violently enforcing 00:19:05.460 --> 00:19:07.940 their own competing Sturm cigarette monopoly, 00:19:08.680 --> 00:19:10.599 completely unaware that their bosses have already 00:19:10.599 --> 00:19:12.779 sold them out. So how does a political system 00:19:12.779 --> 00:19:16.019 resolve a contradiction that massive? What's 00:19:16.019 --> 00:19:18.720 fascinating here is how corporate monopolization 00:19:18.720 --> 00:19:21.480 aligns perfectly with violent political purges, 00:19:21.480 --> 00:19:24.980 because in July 1934, we see the night of the 00:19:24.980 --> 00:19:27.759 long knives. Right. This was Hitler's massive, 00:19:28.119 --> 00:19:30.640 bloody purge of the entire essay leadership. 00:19:31.119 --> 00:19:33.759 Hitler viewed the essay's growing power and independence 00:19:33.759 --> 00:19:36.279 as a direct threat to his consolidation of the 00:19:36.279 --> 00:19:38.799 military and the state. So the top brass of the 00:19:38.799 --> 00:19:40.599 SA is completely wiped out in a matter of days. 00:19:41.019 --> 00:19:44.119 Yes. And crucially, the very SA leaders who had 00:19:44.119 --> 00:19:46.740 profited the most from the Sturm cigarette royalties, 00:19:47.200 --> 00:19:49.140 many of whom personally owned lucrative shares 00:19:49.140 --> 00:19:52.440 in the company, were suddenly dead or imprisoned. 00:19:52.599 --> 00:19:55.220 And with the old fiercely independent SA leadership 00:19:55.220 --> 00:19:57.819 assassinated, the corporate takeover is completed 00:19:57.819 --> 00:20:01.160 with basically zero resistance. The newly appointed 00:20:01.160 --> 00:20:04.079 SA leader, a man named Victor Luzzi, steps in 00:20:04.079 --> 00:20:07.099 and almost immediately cancels the SA's manufacturing 00:20:07.099 --> 00:20:09.519 contract with Sturmcigarettes. Tears it up. Instead 00:20:09.519 --> 00:20:11.720 of running their own anti -corporate brand, he 00:20:11.720 --> 00:20:13.880 makes a deal directly with Riemsma, the corporate 00:20:13.880 --> 00:20:16.529 giant. And the terms of the New Deal reflect 00:20:16.529 --> 00:20:19.130 the total surrender of the essay's independence. 00:20:19.650 --> 00:20:22.069 What were the terms? Rimsma simply agrees to 00:20:22.069 --> 00:20:25.130 pay a fixed lump sum to the essay, which was 00:20:25.130 --> 00:20:30.029 250 ,000 Reichsmarks in 1934, to become the sole 00:20:30.029 --> 00:20:32.210 official producer of the essay's cigarettes. 00:20:32.849 --> 00:20:34.930 The layers of irony here are incredibly dark. 00:20:35.650 --> 00:20:38.170 First, Rimsma's Jewish partners and employees, 00:20:38.309 --> 00:20:41.390 the very people the essay uses ideological justification 00:20:41.390 --> 00:20:44.609 for their violence, successfully emigrated. and 00:20:44.609 --> 00:20:46.869 notably with Remesma's financial help. Right. 00:20:46.890 --> 00:20:49.029 Second, the Sturm cigarette company suddenly 00:20:49.029 --> 00:20:51.630 cut off from its captive audience of essay enforcers 00:20:51.630 --> 00:20:54.009 and left with a warehouse full of unsellable 00:20:54.009 --> 00:20:56.490 trauma cigarettes quietly files for bankruptcy 00:20:56.490 --> 00:20:59.589 in 1935. The self -proclaimed anti -corporate 00:20:59.589 --> 00:21:01.809 street warriors of the essay, who built a brand 00:21:01.809 --> 00:21:04.390 screaming against the trust in the combine, were 00:21:04.390 --> 00:21:06.750 ultimately swallowed whole by the exact corporate 00:21:06.750 --> 00:21:09.369 combine they tried to beat in the streets. Big 00:21:09.369 --> 00:21:11.789 tobacco won by simply purchasing the political 00:21:11.789 --> 00:21:13.660 architecture that controlled the violence. So 00:21:13.660 --> 00:21:15.420 what does this all mean for you, the listener, 00:21:15.940 --> 00:21:18.079 navigating the complexities of the modern world? 00:21:19.160 --> 00:21:21.559 We're often taught to view political power as 00:21:21.559 --> 00:21:23.799 something won purely through grand historical 00:21:23.799 --> 00:21:26.619 speeches, massive election campaigns, and high 00:21:26.619 --> 00:21:29.599 -minded policy debates. Right. But this source 00:21:29.599 --> 00:21:32.819 forces us to confront a much more uncomfortable 00:21:32.819 --> 00:21:36.920 reality. Authoritarian power. and the violence 00:21:36.920 --> 00:21:39.400 required to sustain it is often built on the 00:21:39.400 --> 00:21:43.319 most mundane, everyday consumer habits. It was 00:21:43.319 --> 00:21:45.960 literally financed penny by penny, or fennig 00:21:45.960 --> 00:21:48.640 by fennig, at the checkout counter, fueled by 00:21:48.640 --> 00:21:51.200 physiological addiction and enforced by the threat 00:21:51.200 --> 00:21:54.049 of violence. It really demands that we look critically 00:21:54.049 --> 00:21:56.230 at the intersection of corporate monopolies, 00:21:56.470 --> 00:21:58.750 state power, and the goods we consume blindly. 00:21:59.009 --> 00:22:01.690 Absolutely. The forces of coercion, whether they 00:22:01.690 --> 00:22:03.549 take the form of physical intimidation in the 00:22:03.549 --> 00:22:06.609 1930s or systemic legalized corruption today, 00:22:07.009 --> 00:22:09.170 can easily hide behind something as simple and 00:22:09.170 --> 00:22:11.869 common as brand loyalty. It reminds us that a 00:22:11.869 --> 00:22:14.390 purchase is never just a neutral economic transaction 00:22:14.390 --> 00:22:16.789 when a political entity controls the factory 00:22:16.789 --> 00:22:19.490 floor. Which leads us right back to that violently 00:22:19.490 --> 00:22:21.390 enforced subscription model we talked about at 00:22:21.390 --> 00:22:24.819 the beginning. If historical authoritarian regimes 00:22:24.819 --> 00:22:28.480 successfully used the everyday addictive habits 00:22:28.480 --> 00:22:32.079 of the masses to literally fund their violent 00:22:32.079 --> 00:22:35.259 rise to power, what seemingly innocent everyday 00:22:35.259 --> 00:22:38.160 purchases today might be silently funding the 00:22:38.160 --> 00:22:39.960 political movements of tomorrow. It's a chilling 00:22:39.960 --> 00:22:42.039 thought. Something to think about the next time 00:22:42.039 --> 00:22:44.279 you tap your card at the counter. Thank you for 00:22:44.279 --> 00:22:45.960 joining us on this deep dive. We'll catch you 00:22:45.960 --> 00:22:46.259 next time.