I think their true stupidity was their organization and leadership. A shitty plane or gun or tank would get made because the higher-ups wanted it.

And the fascist idea that competition will inevitably produce the best results - social/technical Darwinism, essentially - meant that the design team that could be pushier and flashier would win over actually good designs.

Plus they kicked out or imprisoned hundreds of great scientists because they were from undesirable classes, further hamstringing their technology.