Part 1: Denazification

So this is a complicated answer that differs greatly between the British, American, and French occupation zones and the Soviet Occupation zone. Since my work has been on the Western zones I will focus primarily on them, but I will try to give some information about what would become East Germany as well.

Even before the war ended the Allies had serious conversations about what to do with the Germans, and a number of processes eventually developed. These policies of denazification would be adjusted and change over time but basically in the American and British zones questionnaires were made and sent out to Germans, asking whether they were members of the Nazi party, when they had joined, what they had done during the war etc. Based on these questionnaires Germans would be given a designation: major offender, offender, lesser offender, followers or "fellow-travelers" and exonerated. Thus the British and Americans focused primarily on individual rehabilitation, the removal of those individuals they saw to be "the bad guys" so to speak.

In the Soviet occupation zone, Nazism was seen primarily as a structural and ideological issue, one that had to be purged through the widespread removal of former Nazis and the imposition of a socialist economic system. So Germans got these questionnaires, they filled them out, and special courts would basically decide what to classify them as. Those classifications could mean very different things, the most severe offenders faced prosecution and jail time, while other designations put certain limits of the jobs they could hold or offices they could run for (once the Federal republic was formed). For example the judicial system was supposed to be purged of former Nazi party members. I say "supposed to" because practical realities and the emerging Cold War changed how the Americans and British approached it. The British especially were concerned about security and the Cold War reality. They were also more cynical about Germany's ability to embrace democracy and properly "denazify." British efforts focused primarily on Nazis in leadership positions, leaving many regular party members to walk free, to be processed by a separate court with fewer repercussions. The American process, a widespread effort, meant that by the time political realities forced them to admit that they couldn't process every single Nazi, many higher ranking Nazis had essentially escaped major punishment, much to the chagrin of lower ranking party members who had been treated harshly earlier in the process. The Allies also quickly realized that it was totally unrealistic to fire every judge, lawyer, and teacher who had been a Nazi, many were quietly reinstated, which would later cause controversy.

These early Allied efforts led to a widespread perception among many Germans that the Allies were dealing too harshly with many accused, indeed a new word, Entnazifizierungsgeschädigten, or, "Those damaged by Denazification" was coined to describe those perceived to be unjustly persecuted. The creation of the Federal Republic, or West Germany in 1949 and the election of Konrad Adenauer as chancellor marked a major shift in denazification. Adenauer campaigned on a platform of an end to denazification, he was convinced that an end to denazification was the only way to win over the German populace and properly reintegrate West Germany into Western Europe, and foster support for democracy. With this in mind his government passed an amnesty act in December 1949 that gave a blanket amnesty to anyone who had been sentenced to one year or less in prison and any fine less than 10000 marks. The act didn't distinguish between lesser crimes and crimes like murder, or standing in the Nazi party or seniority, and while there are no numbers that show exactly how many murderers or higher ranking Nazis were given amnesty, over 700 000 Germans took advantage of this act. Another act would be passed in 1954, granting amnesty to those whose sentences were three years or shorter, and the Americans actually released some of the war criminals they still had in prison after they decided that public opinion overwhelmingly supported their release. In the ten years after the war, most Germans believed that the Allied denazification efforts were too harsh and unfairly targeted Germans who believed, or at least wished to believe, that they were not truly to blame for the crimes of National Socialism.

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Sources:

Turner, Ian D. Reconstruction in Post-War Germany: British Occupation Policy and the Western Zones, 1945-55.

Moeller, Robert G. West Germany under Construction: Politics, Society, and Culture in the Adenauer Era.

Mary Fulbrook, A History of Modern Germany, 1918-2008: A Divided Nation

Jeffrey Herf, Divided Memory: The Nazi Past in the Two Germanys

Norbert Frei, Adenauer's Germany and the Nazi Past