(4 of 9)
From Schacht’s IMT testimony: Throughout the years from 1935, up to and including 1938, numerous statesmen from almost all other nations came to Berlin to visit Hitler, including some crowned heads . . . . It is not limited to Europe. I do not intend to make any political explanations; I merely say that there were so many visitors, which meant not only recognition, but respect for Hitler: that this man appeared a very great man in the eyes of the German people. I still remember that, in 1925 I believe, the King of Afghanistan, Amanullah, appeared in Berlin. He was the first foreigner to visit the Social Democratic Government, and there was a celebration because, at last, a great man from another country had visited us. In the case of Hitler, starting with 1935, there was one visitor after another; and Hitler went from one foreign political success to another, which made it extremely difficult to enlighten the German people, and made it impossible to work for that enlightenment within the German nation.
From a pre-trial interrogation of Schacht:
Q: And the Four Year Plan came in when?
A: It was announced in September 1936, on the Party Day.
Q: Do you say that from the time that the Four Year Plan came in September 1936, you were ready to rid yourself of your economic duty?
A: No. At that time I thought that I might maintain my position, even against Goering.
Q: Yes, in what sense?
A: That he would not interfere with affairs [that] I had to manage in my ministry.
Q: As a matter of fact, his appointment was not met with favor by you?
A: I would not have ever appointed a man like Goering, who didn’t understand a bit about all these things . . . .
Whereas I have called Hitler an amoral type of person, I can regard Goering only as immoral and criminal. Endowed by nature with a certain geniality, [which] he managed to exploit for his own popularity, he was the most egocentric being imaginable. The assumption of political power was, for him, only a means to personal enrichment and personal good living. The success of others filled him with envy. His greed knew no bounds. His predilection for jewels, gold, and finery, et cetera, was unimaginable. He knew no comradeship. Only as long as someone was useful to him, did he profess friendship.
Goering’s knowledge in all fields in which a government member should be competent was nil, especially in the economic field. Of all the economic matters that Hitler entrusted to him in the autumn of 1936, he had not the faintest notion, though he created an immense official apparatus and misused his powers, as lord of all economy, most outrageously. In his personal appearance, he was so theatrical that one could only compare him with Nero. A lady who had tea with his second wife reported that he appeared at this tea in a sort of Roman toga, and sandals studded with jewels, his fingers bedecked with innumerable jeweled rings, and generally covered with ornaments, his face painted and his lips rouged . . . . I have never had a friendship with Goering. I surely cannot refuse to work with him, especially as long as I do not know what kind of a man he is.
From the IMT testimony of Dr Hans Heinrich Lammers, Chief of the Reich Chancellery: The infringement on the authority of the individual ministers arose because of the number of institutions which the Fuehrer had created, obviously quite consciously, as a counterpoise, I might say, to the various ministers. That is the one faction. Secondly, it was done through offices, created on a higher level, which, in the interest of a certain uniformity in particular fields, were to have sole authority. In the last category, the typical example is, in the first instance, the Four-Year Plan. In this connection, the Fuehrer desired a comprehensive unified direction, which was not to depend on the wishes of the ministers of the departments and, consequently, he created the Four-Year Plan. In other sectors, in some way or other, the minister was confronted with a counterpart; for instance, by the appointment of Herr Ley as Reich Commissioner for Housing, the Minister for Labor lost his jurisdiction in the important field of housing. He was relieved of one of his main duties by the appointment of the Plenipotentiary General for the Allocation of Labor, Herr Sauckel, in the field of labor employment. As far as economy was concerned, the Minister of Economy, as I have already mentioned, was considerably limited in his powers, by the setting up of the Four Year Plan, and the powers given to it, and later, in addition to that, by the powers [that] were transferred to the Minister for Armament and War Production.
From Schacht’s IMT testimony: At that time, in 1936, when the Four Year Plan was introduced in September, I could not tell what Hitler’s inner attitude to me was, in regard to these questions of economic policy. I might say that it was clear that, after my speech at Koenigsberg in August 1935, he mistrusted me. But his attitude to my activities in the field of economic policy was something [that] I was not yet sure of, in 1936. The fact that I had not, in any way, participated in the preparation of the Four Year Plan, but heard about it quite by surprise during the Party Rally and that, quite unexpectedly, Hermann Goering and not the Minister of Economics was appointed head of the Four Year Plan, as I heard for the first time at the Party Rally in September 1936, these facts naturally made it clear to me that Hitler, as far as economic policy with reference to the entire rearmament program was concerned, did not have that degree of confidence in me. which he thought necessary. Subsequently, here in this prison, my fellow Defendant Speer showed me a memorandum, which he received from Hitler on the occasion of his taking over the post of Minister and which, curiously enough, deals in great detail with the Four Year Plan, and my activities, and is dated August 1936 . . . .
I thought he [Goering] was unsuited and, of course, it made an opening for a policy that was opposed to mine. I knew perfectly well that this was the start of exaggerated armament, whereas I was in favor of restricted rearmament. I said "Arm within the limits of what is economically possible and reasonable." Goering, if I may say it again, wanted to go beyond those limits. I said that the most important thing was that Germany should live, and have foreign trade, and within those limits we could arm. However, it is out of the question that Germany should arm for the sake of arming, and thus ruin her economy. The point is ... that German economy paid the price for Goering’s action. The only question is, was it reasonable or unreasonable? If I may state it pointedly, I would say that I considered Goering’s economic policy to be unreasonable, and a burden to the German nation; while I considered it most important that rearmament should not be extended, and that the German nation should have a normal, peacetime standard.
The planning and determination of objectives, as well as the control over the execution of the tasks [that] must be accomplished within the framework of the Four Year Plan, are the responsibility of the Office for German Raw and Synthetic Materials, which supersedes the authorities which have heretofore been in charge of these tasks.December 9, 1936: From a speech by Schacht at Frankfurt:
Germany has too little living space for her population. She has made every effort, and certainly greater efforts than any other nation, to extract from her own existing small space whatever is necessary for the securing of her livelihood. However, in spite of all these efforts, the space does not suffice.
From Schacht’s IMT testimony: This speech of 9 December 1936 was a speech that was solely concerned with a restoration of the colonial rights of Germany. I have never demanded any Lebensraum for Germany other than colonial space. And in this instance, again, I am surprised that just the American Prosecutor should accuse me on my efforts in this direction because, in the Fourteen Points of Wilson, which regrettably were not adhered to later on, the colonial interests of the Germans are taken into consideration. In consequence, I said, again and again: "If you want peace in Europe, give Germany an economic outlet into which Germany can develop, and from which she can satisfy her needs. Otherwise Germany will be a center of unrest, and a problem for Europe."
I would like to quote one sentence only from the speech I made:
"Peace in Europe, together with the peace of the entire world, is dependent upon whether or not the densely populated areas of Central Europe will have the means of existence."
I emphasized this viewpoint, again and again, but at no time did I connect these views with the idea of an armed conflict. I would like to quote another sentence from this same speech:
"I did not mention this consideration as to the parts of Germany which were separated from her"--and I am speaking of the losses suffered by Germany--"in order that we might draw the conclusion of war-like intentions; my entire position and my work are marshaled to the objective of bringing about peace in Europe, through peaceful and sensible considerations and measures."
The supervisory offices are obliged to accept instructions from me alone. They must answer all official inquiries for any information of the Office for German Raw and Synthetic Materials, in order to give any information at any time to the fullest extent . . . . I herewith authorize the supervisors of offices to take the necessary measures for themselves. In case doubts should result from requests of the above offices, and these doubts cannot be cleared by oral negotiations with the experts of these offices, I should be informed immediately. I will then order in each case the necessary steps to be taken.
From a pre-trial interrogation of Schacht:December 19, 1936: Schacht receives support from elements of the military, in his turf-war with Goering. From a draft of a memorandum by the Military Economic Staff:
After Goering had taken over the Four Year Plan, and I must say after he had taken over the control of Devisen, already since April 1936, but still more after the Four Year Plan in September 1936, he had always tried to get control of the whole economic policy. One of the objects, of course, was the post of Plenipotentiary for War Economy in the case of war; being only too anxious to get everything into his hands, he tried to get that away from me. Certainly, as long as I had the position of Minister of Economics, I objected to that.
(1) The direction of war economy in the civilian sector in case of war can be handled only by the person who, in peacetime, has borne the sole responsibility for the preparations for war. Upon recognizing this fact, a year and a half ago, Reichsbank President Dr. Schacht was appointed Plenipotentiary General for War Economy, and an operations staff was attached to his office.
(2) The Military Economy Staff does not deem it compatible with the principle laid down in Number 1, Paragraph 1, if the Plenipotentiary General for War Economy is now placed under the Minister President General Goering’s command.
From Schacht’s IMT testimony: The differences with Goering about this so-called Plenipotentiary for War Economy occurred in the winter 1936-37, and the so-called last conversation with Goering which you have just mentioned took place in November 1937. I stated, I believe in January 1937, that I was prepared to turn over the office and the activity as Plenipotentiary for War Economy immediately to Goering. That can be found in the memorandum from the Jodl Diary, [which] has been frequently mentioned here.
At that time, the War Ministry, and Blomberg in particular, asked to have me kept in the position of Plenipotentiary for War Economy, since I was the Minister of Economy, as long as I was the Minister of Economy. You can find the correspondence about that, which I think has already been submitted by you to the Tribunal . . . . I wish to say that that disagreement between Goering and me had absolutely nothing to do with the conversation of November, and that it was not even a disagreement between Goering and me. That disagreement which you have just read about occurred in January 1937, but it was not at all a difference of opinion between Goering and myself because I said right away, "Relieve me of the post of Plenipotentiary for War Economy, and turn it over to Goering." And the War Ministry, that is, Herr Von Blomberg, protested against this, not I. I was delighted to turn over that office to Goering. I do not want to continue that play with words as to whether it was personal or anything else, Mr. Justice. I had differences with Goering on the subject; and if you ask whether it was on armament, speed, or extent, I reply that I was at greatest odds with Goering in regard to these points.
I have never denied that I wanted to rearm in order to gain equality of position for Germany. I never wanted to rearm any further. Goering wanted to go further; and this is one difference which cannot be overlooked.
From the affidavit of Emil Reuter: I had a biography of Dr. Schacht published twice: first, at the end of 1933, by the Publishing House R. Kittler in Berlin; and at the end of 1936, by the German Publishing Institute in Stuttgart. Besides its being a factual presentation of his life and his work, it also served the purpose of shielding him from his attackers. Therefore, the principles of purely objective historical research are not applicable to this publication, because defensive views, required by the situation at the time, [have] to be taken into consideration.
From Schacht’s IMT testimony: I believe that, at the time, Hitler had the impression that I could be useful to him outside of the Party, and it may be that Dr. Reuter got knowledge of this. But I would rather not be made responsible for the writings of Dr. Reuter and, in particular, I should like to object to the fact that the Prosecutor who presented the brief against me described this book by Dr. Reuter as an official publication. Of course, this book is the private work of a journalist for whom I have respect, but who certainly states his own opinions and ideas.
From Schacht’s IMT testimony: I do not know whether it has been mentioned here; the Golden Party Emblem was in January 1937 given to all Ministers, and also to all military personalities in the Cabinet. The latter could not become Party members at all; therefore the award of the Party emblem did not entail membership. As to the rest, I think Goering has testified from the witness stand. I might mention one more thing. If I had been a Party member then, doubtlessly, when I was ousted from my position as Minister without Portfolio in January 1943, the Party Court would have gone into action, since a case of insubordination to Hitler would have been evident. I was never before the Party Court and, even when on the occasion of my dismissal the return of the Golden Party Emblem was demanded from me, I was not told that I was being dismissed from the Party, since I was not in the Party: I was only told "return the Golden Emblem of the Party which was conferred upon you," and I promptly complied. I believe I could not add anything else to the statements already made . . . .
Excuse me, but I was opposed to quite a number of points of the National Socialist ideology. I do not believe that it would have been compatible with my entirely democratic attitude to change over to a different Party program, and one which, not in its wording, but through its execution by the Party, had certainly not--in the course of time--gained any more favor with me . . . .
It [the Golden Party Emblem] was very convenient on railroad journeys, when ordering a car, et cetera.
From Schacht’s IMT testimony: I have never received any kind of donations from Hitler, and I think he would hardly have risked offering me one. I did, indeed, receive one present from Hitler, on the occasion of my 60th birthday. He gave me a picture that certainly had the value of about 20,000 marks. It was an oil painting by a German painter, Spitzweg, and would have been worth approximately 200,000 marks, if it had been genuine. As soon as the picture was brought into my room, I recognized it as a forgery, but I succeeded, about 3 months later, in tracing the original. I started proceedings on the subject of the genuineness of the picture, and the forgery was established before a court. If the Tribunal will permit me, I would like to say that I returned the forgery, and it was never replaced; so that I have received no presents from Hitler.
Hitler offered me a uniform. He said I could have any uniform I desired, but I only raised my hands in refusal and did not accept any, not even the uniform of an official, because I did not wish to have a uniform.
From Wilhelm Vocke’s IMT testimony: No [Schacht never received any gifts or had any economic advantages during Hitler’s time beyond his regular income as an official]; that was quite out of the question for Schacht. Besides, he was never offered gifts. In all his dealings, as far as money was concerned, he was absolutely clean and incorruptible. I can give examples. For instance, when he left in 1930, he reduced his pension to less than half the pension of the vice president or of any board member. He said: "These people have devoted their whole life to the bank, whereas I have given only a few years incidental service." I could give more examples of Schacht’s absolute correctness in that respect.
From Schacht’s IMT testimony: Perhaps, if it is permitted, I might refer to two other sentences from my article, which was published in Foreign Affairs, the well-known American magazine, in the year 1937. I have the German translation before me, which says, in the introduction, and I quote:
"I am making these introductory remarks, in order to clarify the situation. The colonial problem today, as in the past, is for Germany not a question of imperialism or militarism, but still, surely and simply a question of economic existence."
Perhaps I might refer to the point that very influential Americans were in constant accord with this view. I have a statement made by the collaborator of President Wilson, Colonel House, who made the well-known distinction between the "haves" and "have nots," and who was especially influential in advocating consideration for German colonial interests. Perhaps I can dispense with the quotation . . . .
I have already set forth just now that I constantly said that Europe cannot have peaceful development, if there are no means of livelihood for the completely overpopulated Central Europe and, I believe, conditions at present show how absolutely right I was--just what an impossibility it is to feed these masses of people within Europe. And beyond that, I had a keen interest in diverting Hitler’s quite misguided ideas from Eastern Europe, and therefore, was constantly at pains to direct his attention to the colonial problem, so that I could turn his thought from the mad ideas of expansionism in the East. I recall that in 1932, shortly before he assumed office, I had a conversation with him, in which, for the first time, I approached him on these facts, and particularly told him what utter nonsense it would be, to think of an expansion in the East.
Then, constantly, in the subsequent years, again and again, I spoke about the colonial problem until, at the last, in the summer of 1936, I had the possibility of pursuing my ideas, and Hitler gave me the mission, which I had suggested to him, of going to Paris to discuss with the French Government the possibility of a satisfactory solution of the question of colonies for Germany. This actually happened in the summer of 1936. And for the satisfaction of myself and all other friends of peace, I might say that the Government of Leon Blum, which was in office at the time, showed gratifying appreciation of this solution for Europe’s food and economic problems and, for their part, stated that they were ready to deal with the colonial problem, with the aim of perhaps returning one or two colonies to Germany. Leon Blum then undertook, in agreement with me, to inform the British Government about these conversations, in order to secure their consent, or to bring up a discussion of this problem within the British Government. That actually did take place, but the British Government hesitated for months, before they finally could decide on any position in this matter, and so the discussion dragged on, up to the initial months of the Spanish civil war and was eclipsed and supplanted by the problems of the Spanish civil war, so that a continuation of the discussion on this colonial problem never came about.
At that time, in January of 1937, when the American Ambassador to Moscow, Ambassador Joseph Davies, visited me at Berlin, I was rather irritated by the slowness with which the British Government was meeting these suggestions, and consequently I came forth with a request for understanding and support, and told Ambassador Davies about this whole matter. I tried, constantly and repeatedly, to gain the understanding support of representatives of the American Government. I tried again and again to advise these gentlemen about domestic conditions and developments within Germany, to tell them as much as was possible, and compatible with German interests, and to keep them informed. That applies to Ambassador Davies, Ambassador Dodd, [and] Ambassador Bullitt when he was in Berlin, and so on.
This conversation with Ambassador Davies is referred to in the document, which the Prosecution has submitted, Document L-111, and which is taken from the book [that] Ambassador Davies wrote about his mission in Moscow, and we will perhaps come back to this book later.
As the gist of my conversation with Davies, I would like to quote just one sentence again, which I must again quote in English, since I have only the English book at my disposal.
"Schacht earnestly urged that some such feasible plan could be developed, if discussions could be opened; and that, if successful, would relieve the European war menace, relieve peoples of enormous expenditures for armaments, restore free flow of international commerce, give outlet to thrift and natural abilities of his countrymen, and change their present desperation into future hope."
From the affidavit by General Georg Thomas:February 22, 1937: Schacht attempts to force a show-down with Goering, by temporarily refusing to act in his capacity as Plenipotentiary. From a letter from von Blomberg, the Minister of War, to Hitler:
Q: Schacht claims to have influenced Blomberg to delay rearmament. Can you give any information on this matter? When was it?
A: I was Chief of the Army Economic Staff, which is the Army Economic and Armament Office at the High Command of the Wehrmacht (OKW) from 1934 to the time of my dismissal in January 1943. In this capacity, I had connection with the Reich Minister of Economics and Reich Bank President, Hjalmar Schacht. Up till 1936, Schacht undoubtedly promoted rearmament, by making available the necessary means. From 1936 on, he used every opportunity to influence Blomberg to reduce the tempo and extent of rearmament. His reasons were as follows:
1. Risk to the currency.
2. Insufficient production of consumer goods.
3. The danger to the foreign policy, which Schacht saw in excessive armament of Germany.
Concerning the last point, he frequently spoke to Blomberg and me, and said that, on no account, must rearmament be allowed to lead to a new war. These were also the reasons [that] led him to hold out to Blomberg in 1936, and again in 1937: the threat that he would resign. On both of these occasions, I was delegated by Blomberg to dissuade Schacht from carrying out his threat to resign. I was present during the conference between Blomberg and Schacht in 1937.
The President of the Reichsbank, Dr. Schacht, has notified me that he is not acting in his capacity as Plenipotentiary for the time being since, in his opinion, there exist discrepancies regarding the powers conferred upon him, and those of Colonel General Goering. Because of this, the preparatory mobilization steps in the economic field are delayed.
From the IMT testimony of Hans Bernd Gisevius: He [Schacht] was entirely taken up with the idea, like many other people in Germany at that time--I might almost say the majority of the people in Germany--the idea that everything depended on strengthening the middle class influence in the cabinet and, above all, and as a prerequisite, that the Reich Ministry of War, headed by Blomberg, should be brought over to the side of the middle class ministers. Schacht had, if you want to put it like that, the very constructive idea that one must concentrate on the fight for Blomberg. That was precisely where I agreed with him, for it was the same battle which I, with my friend Oster, had tried to fight in my small department, and in a far more modest way.
First of all, he tried to establish close contact with the competent expert in the Ministry of War, General Thomas who, later on, became Chief of the Army Economic Staff. Thomas was a man who, right from the beginning, was skeptical about National Socialism, or even opposed it. As by a miracle, he later on emerged from the concentration camp alive.
Schacht, at that time, began to fight for Blomberg, through Thomas. I took part in that fight, because Schacht used me as an intermediary through Oster, and I was also informed about these connections through Herbert Goering [Hermann’s cousin]. Moreover, I learned about these things from many discussions with Thomas. I can testify here that, even at that time, it was extraordinarily difficult to establish connection between Schacht and Blomberg, and I was naive enough to tell Schacht, repeatedly, simply to telephone Blomberg and ask him for an interview. Schacht replied that Blomberg would certainly be evasive, and that the only way was to prepare the meeting via Oster and Thomas. This was done.
I know how much we expected from the many discussions Schacht had with Blomberg. I was, of course, not present as a witness, but we discussed these conferences in great detail at the time. I took notes and was very pleased when I found that these recollections of mine tallied absolutely with the recollections of Thomas, whose handwritten notes I have in my possession. Thomas was repeatedly reprimanded by Blomberg and was told not to bother him with these qualms on Schacht’s part.
From a pre-trial statement of Emil Puhl, a director of the Reichsbank during Schacht’s presidency: In the early part of 1935, the need for financing an accelerated rearmament program arose. Dr. Schacht, President of the Reichsbank, after considering various techniques of financing, proposed the use of mefo bills, to provide a substantial portion of the funds needed for the rearmament program. This method had, as one of its primary advantages, the fact that secrecy would be possible during the first years of the rearmament program; and figures indicating the extent of rearmament, that would have become public through the use of other methods, could be kept secret through the use of mefo bills.
From Schacht’s IMT testimony: I used every opportunity, in particular during conversations with men from abroad, to say that the aim should always be disarmament; that, of course, rearmament would always mean an economic burden for us, which we considered a most unpleasant state of affairs.
I remember a [conversation I] had with the American Ambassador Davies. His report of this conversation is incorporated in an exhibit that has been submitted to the Tribunal. It is an entry in a diary, which is repeated in his book, Mission to Moscow, and it is dated as early as 20 June 1937, Berlin. He is writing about the fact that, among other things, he and I had talked about disarmament problems, and I need only quote one sentence. I do not have the number of the document, Your Lordship, but it has been submitted to the Tribunal.
When I outlined the President’s (Roosevelt) suggestion of limitation of armament to defensive weapons only, such as a man could carry on his shoulder, he [Schacht] almost jumped out of his seat with enthusiasm. It becomes clear, therefore, from Ambassador Davies’ remark that I was most enthusiastic about this renewed attempt and the possibility of an imminent step towards disarmament, as proposed by President Roosevelt. In this same book, Davies reports a few days later, on 26 June 1937, about the conversation he had with me, in a letter addressed to the President of the United States. I quote only one very brief paragraph--in English again:
"I then stated to him [Schacht] that the President, in conversation with me, had analyzed the European situation and had considered that a solution might be found, in an agreement among the European nations, to a reduction of armaments to a purely defensive military basis, and this, through the elimination of aircraft, tanks, and heavy equipment, and the limitation of armaments to such weapons only, as a man could carry on his back, with an agreement among the nations, for adequate policing of the plan by a neutral state. Schacht literally jumped at the idea. He said: ’That’s absolutely the solution.’ He said that, in its simplicity, it had the earmarks of great genius. His enthusiasm was extraordinary."
I was certainly, by no means ready to advance any unlimited amount of money, particularly as these were not contributions; they were credits which had to be repaid. The limits for these credits were twofold. One was that the Reichsbank was independent of the State finance administration, and the supreme authority of the State, as far as the granting of the credits was concerned. The Board of Directors of the Reichsbank could pass a resolution that credits were to be given, or were not to be given; or that credits were to be stopped, if they considered it right and, as I was perfectly certain of the policy of the Board of Directors of the Reichsbank--all of these gentlemen agreed with me perfectly on financial and banking policy--this was the first possibility of applying a brake, if I considered it necessary.
The second safeguard-limit was contained in the agreement [that] the Minister of Finance, the Government and, of course, Hitler had made: the mefo bills, of which these credits consisted, were to be paid back when they expired. They were repayable after 5 years, and I have already said that, if the repayments had been made, funds for rearmament would naturally have had to decrease. Therein lay the second possibility of limiting the rearmament.
Naturally [I intended to grant] as little as possible; however, what I contributed is what is decisive. I placed at their disposal--to give one figure and to be very brief--until 31 March 1938, credits amounting to a total of 12,000,000,000 Reichsmarks. I have discussed that with one of the interrogators of the British Prosecution, who asked me about the subject, and I replied that that was about one third of the amount which was spent on rearmament. After that, without the Reichsbank, beginning with 1 April 1938, the figure stated in that budget year for rearmament was 11,000,000,000, and in the subsequent year, 20,500,000,000 and, of that, not a pfennig came from the Reichsbank ... For the record, I should like to say that I think I made a mistake before. I said millions instead of milliards, but I think it is obvious what I meant. I wanted only to correct it.
From the interrogation of General von Blomberg:
A: At that time, the organization of the planned Wehrmacht was about complete.
Q: When? 1937?
A: I believe it was 1937.
Q: Was that a plan that had been discussed with Doctor Schacht, in connection with the financing, as to how big the Wehrmacht would be?
A: Yes. Schacht knew the plan for the formation of the Wehrmacht very well, since we informed him, every year, about the creation of new formations, for which we had been expending money. I remember that, in the year 1937, we discussed what the Wehrmacht would need for current expenses, after a large amount had been spent for creating it.
Q: That means that you gave Schacht a clear statement, of how much money each year went into the creation of new units, new installations, and so forth, and how much you were using for the operating expenses of the Wehrmacht?
A: Exactly right.
Q: When you say that by 1937 the plan had been fulfilled, do you mean in the main?
A: In the main . . . .
Q: When you say that Schacht was familiar with those figures, how were they brought to his attention?
A: The demands for the money needed were handed to Schacht in writing.
Q: That means that, in connection with the money which Schacht was raising for the rearmament program, he was informed of how many divisions, and how many tanks and so forth would be procured through these means?
A: I don’t think we put down the amount of money we would need for every tank and so forth, but we would put down how much every branch of the Wehrmacht, like the Navy or Air Force, needed, and then we would state how much was required for activating, and how much for operating.
Q: That is, Doctor Schacht could see, each year, how much of an increase there would be in the size of the Armed Forces, as a result of the money he was procuring?
A: That is certain.
From Schacht’s IMT testimony: Yes [I deny making these statements], unfortunately, I must say that I know nothing about this. A member of the Reichsbank Directorate, Geheimrat Vocke, will testify tomorrow; and I ask that you put this matter to him, so that the question will be clarified. The question was not one of informing me, but of informing the Reichsbank Directorate. Everything that I knew, the Reichsbank Directorate naturally also knew ... Evidently he does not remember.
From Schacht’s pre-trial interrogation:
Q: Let me ask you then, in 1937 what kind of war did you envisage?
A: I never envisaged a war. We might have been attacked, invaded by somebody but, even that, I never expected.
Q: You did not expect that. Did you expect a possibility of a mobilization and concentration of economic forces in the event of war?
A: In the event of an attack against Germany, certainly.
Q: Now, putting your mind back to 1937, are you able to say what sort of an attack you were concerned with?
A: I do not know, Sir.
Q: Did you have thoughts on that at the time?
A: No, never.
Q: Did you then consider that the contingency of war in 1937 was so remote as to be negligible?
Q: You did?
From Schacht’s IMT testimony: I considered every kind of expansion within the European continent as sheer folly. I told [Hitler] it was nonsense to undertake anything toward the East. Only colonial development could be considered.
From Wilhelm Vocke’s IMT testimony: At that time, when the economy was already racing ahead, and more and more money was being put up, Schacht asked for the support of the German professors of economy, and called them together to persuade them to work along his lines, that is, to try to check this trend. At that meeting, one of those present asked Schacht the question: "What will happen, if war breaks out?" Schacht got up and said: "Gentlemen, then we are lost. Then everything is over with us. I ask you to drop this subject. We cannot worry about it now."
People who under cover of darkness heroically smear window panes, who brand as a traitor every German who trades in a Jewish store, who declare every former Free Mason to be a scoundrel, and who, in the fight against priests and ministers who talk politics from the pulpit, cannot themselves distinguish between religion and misuse of the pulpit . . . .
In accordance with the present legislation, and in accordance with the various declarations made by the Fuehrer’s Deputy, the Reich Minister of the Interior, and the Reich Minister for Public Enlightenment and Propaganda (not to mention the Ministry of Economics), Jewish businesses are permitted to carry on their business activities as heretofore . . . .
No one in Germany is without rights. According to Point 4 of the National Socialist Party program, the Jew can be neither a citizen nor a fellow German. But Point 5 of the Party program provides legislation for him too; that means, he must not be subjected to arbitrary action but, to the law . . . .
We are meeting together here, to remember with respect and love the man [Hitler] to whom the German people entrusted the control of its destiny more than 4 years ago . . . . With the limitless passion of a glowing heart, and the infallible instinct of a born statesman, Adolf Hitler, in a struggle which he led for 14 years with calm logic, has won for himself the soul of the German people.
From Schacht’s IMT testimony: I do not believe that anyone, on the occasion of the birthday celebration of the head of a state, could say anything very different . . . . I always urged Hitler to give legal protection to the Jews. I wanted to see this law enacted, and I assumed that it would be done but, instead, the Racial Laws of September or November, yes, November, 1935, were passed . . . .
Since, up to then, my speeches were not subject to censorship--of course I would not have allowed that--this speech was broadcast by mistake, so to speak, over the Deutschlandsender [literal meaning: "Germany transmitter"--one of the longest-established German radio station names]. In that way, the speech was brought to the notice of Propaganda Minister Goebbels and, at once, he issued an order prohibiting the publication of the speech in the newspapers. As a result, although the speech was broadcast by the Deutschlandsender, it did not appear in any newspaper. But as, fortunately, the Reichsbank had its own printing press, which was of course not subject to censorship, I had the speech printed [there] and 250,000 copies of it were distributed to the 400 branches of the Reichsbank throughout the country and, in that manner, it became known to the entire population.
No community and, above all, no state can flourish, which is not based on legality, order, and discipline . . . . For that reason, you must not only respect the right and the law, but you must also act against injustice and unlawful actions everywhere, wherever you find them.
From Schacht’s IMT testimony: And because I made known my attitude, not only to a close circle, but also to a wider public, by using every opportunity to voice my views frankly--because of this, a few weeks ago in this court, the Chief of the RSHA, Department III, Security Service, the witness Ohlendorf, in reply to a question, described me as an enemy of the Party, at least since the year 1937-1938. I believe that the Chief of the Security Service, the inland department, should know, since he had the task of combating political opponents inside Germany.
The aim and the idea of the Four Year Plan were and remain entirely correct and necessary! It stands, essentially, for the application of increased energy to the efforts, already undertaken by my ministry since 1934, with the results shown in the above statistics. As you will remember, I welcomed it when your energy, my dear Prime Minister, was recruited by the Fuehrer for these tasks and, from the very beginning, I gave you my most loyal support and cooperation, with the particular plea that I be given a hearing from time to time, since I believed that my more than thirty years of experience in economic life, half of them in public service, could be of value to you . . . .
Meanwhile, I repeatedly stressed the need of increased exports, and actively worked towards that end. The very necessity of bringing our armament up to a certain level, as rapidly as possible, must place in the foreground the idea of as large returns as possible in foreign exchange and, therewith, the greatest possible assurance of raw material supplies . . . . I have held this view of the economic situation, which I have explained above, from the first moment of my collaboration . . . . I ask you to believe me, my dear Prime Minister, that it is far from me to interfere with your policies, in any way whatsoever. I offer no opinion, either, as to whether my views, which are not in agreement with your economic policy, are correct or not. I have full sympathy for your activities. I do believe, however, that in a totalitarian state, it is wholly impossible to conduct two divergent economic policies.
From Schacht’s IMT testimony: The differences which led to my resignation resulted from the fact that Goering wanted to assume command over economic policies, while I was to have the responsibility for them. And, I was of the opinion that he who assumes responsibility should also have command and, if one has command, then he also has to assume the responsibility. That is the formal reason why I asked for my release.
In conclusion, I should like to refer to remarks which you made in a paragraph of your letter entitled The Four Year Plan, about your general attitude toward my work in regard to the economic policy. I know, and I am pleased that, at the beginning of the Four Year Plan, you promised me your most loyal support and co-operation, and that you repeatedly renewed this promise, even after the first differences of opinion had occurred, and had been removed in exhaustive discussions. I deplore, all the more, having the impression recently, which is confirmed by your letter, that you are increasingly antagonistic toward my work in the Four Year Plan. This explains the fact that our collaboration has gradually become less close.
From the IMT testimony of Hans Bernd Gisevius: Schacht tried to approach Baron von Fritsch, the Commander-in-Chief of the Army. As, however, he was very difficult to approach, he sent his Reichsbank vice president, Dreyse, to establish the contact. We also made one big attempt to approach Fritsch and Blomberg, through General von Kluge. This step had as its object to make it clear to Blomberg, that things were taking a more and more extreme turn, that the economy of the country had deteriorated, and that the Gestapo terror must be stopped by all possible means . . . .
Although Schacht made a great effort to get in touch with Fritsch, it was not possible to arrange a conversation in Berlin. It was secretly arranged that they should meet in Muenster, as General Von Kluge was too scared to meet Schacht publicly, at the time. There was a lot of beating about the bush, the net result was that the two gentlemen did not meet. It was not possible to bring together a Reich minister and a commanding general. It was all most depressing . . . .
I was still in Muenster at that time but, in the middle of 1937, Schacht wanted me to return to Berlin. The greater his disappointment, the more he was inclined to take seriously my warnings against an increasing radicalism, and an SS revolt. By the autumn of 1937, things in Germany had reached such a point that everybody in the opposition group felt that evil plans were being made. We thought, at that time, that there would be another day of blood like 30 June, and we were trying to protect ourselves. It was Schacht who got in touch with Canaris through Oster, and expressed the wish that I should be brought back to Berlin, in one way or another. At that time, there was no government office [that] would have given me a post. I had no other choice but to take a long leave from the civil service, alleging that I wanted to devote myself to economic studies. Schacht, in agreement with Canaris and Oster, arranged for me to be given such a post in a Bremen factory, but I was not allowed to show myself there; and so I came to Berlin, to place myself completely at the disposal of my friends, for future happenings.
From Schacht’s IMT testimony: First of all, I tried to continue my own economic policy, in spite of the fact that Goering as head of the Four Year Plan tried, of course, as time went on, to take over as many of the tasks concerned with economic policy as possible. But the very moment Goering encroached on my rights as Minister of Economics, I used it as an opportunity to force my release from the Ministry of Economics. That was at the beginning of August 1937.
At the time, I told Hitler very briefly the reason, namely, that if I was to assume responsibility for economic policy, then I would also have to be in command. But if I was not in command, then I did not wish to assume responsibility. The fight for my resignation, fought by me at times with very drastic measures, lasted approximately two and a half months until, eventually, Hitler had to decide to grant me the desired release, in order to prevent the conflict from becoming known to the public more than it already was.
From an affidavit of Kammerdirektor Dr. Asmus: When this was found to be unsuccessful [his fight] and when developments continued along the course [that] he considered wrong, he [Schacht] in the autumn of 1937, long before the beginning of the war, acted as an upright man and applied for release from his office as Reich Minister of Economics and, thereby, from his co-responsibility.
He was obviously not able to resign his office in the normal way because, for reasons of prestige, the Party required the use of his name. Therefore, in the autumn of 1937, he simply remained away from the Ministry of Economics for several weeks. He started this sit-down strike, as it was humorously called in the Ministry, and went in his official capacity only to the Reichsbank.
From Inside the Third Reich by Albert Speer: Sometime around 1936, Schacht had come to the salon of the Berghof to report. We guests were seated on the adjacent terrace, and the large window of the salon was wide open. Hitler was shouting at his Finance Minister, evidently in extreme excitement. We heard Schacht replying firmly in a loud voice. The dialogue grew increasingly heated on both sides, and then ceased abruptly. Furious, Hitler came out on the terrace, and ranted on about this disobliging, limited minister who was holding up the rearmament program.
From Schacht’s IMT testimony: I think we should inform the Tribunal of one matter, about which I also learned here in prison from my fellow Defendant Speer. He overheard the argument between Hitler and myself on the occasion of that decisive conference, in which I managed to push through my resignation. Hitler came out on the terrace after this conference, and said to those present, among them Speer, that he had had a very serious argument with Schacht, that he could not work with Schacht, and that Schacht was upsetting his financial plans.
From Schacht’s IMT testimony: To my great surprise, I was informed of that meeting on 20 October 1945, here in my cell [in Nuremberg], and I was extremely astonished that, during all previous interrogations, I had never been asked about this record, because it can be seen clearly from it, that the Reich Government was not to be informed of Hitler’s intentions for war, and therefore could not know anything about them.
Hitler was determined to have Austria eventually attached to Germany, and to obtain at least autonomy for the Germans of Bohemia. At the present moment, he was not vitally concerned about the Polish Corridor, and in his [Schacht’s] opinion, it might be possible to maintain the Corridor, provided Danzig were permitted to join East Prussia, and provided some sort of a bridge could be built across the Corridor, uniting Danzig and East Prussia with Germany.
From Schacht’s IMT testimony: I see nothing in the entire report to the effect that Hitler was about to start an aggressive war. I was simply talking about Hitler’s intentions to bring about an Anschluss of Austria, if possible, and to give the Sudeten Germans autonomy, if possible. Neither of those two actions would be aggressive war and, apart from that, Mr. Bullitt says the following, with reference to me, in his report about this conversation. I quote: "Schacht then went on to speak of the absolute necessity for doing something to produce peace in Europe...."
I recall a conversation with Ambassador Bullitt in November 1937. This [conversation has] already been mentioned in some other connection, and Ambassador Bullitt’s memorandum has been presented in evidence to the Tribunal by the Prosecution. I merely refer to the sentence which refers to me, and I quote:
"He"--that is to say Schacht--"prefaced his remarks by saying that he himself today was ’completely without influence on that man"’--meaning Hitler. "He seemed to regard himself as politically dead, and to have small respect for ’that man.’"
That was said in November 1937. But if I am permitted to add to this, I want to point out that my foreign friends were kept constantly informed about my position, and my entire activity as regards the directing of public affairs in Germany, as I have already mentioned once before. This will be seen on later occasions, when various instances are mentioned.
From a pre-trial interrogation of Schacht:November 26, 1937: From a letter from Hitler to Schacht:
A: It may amuse you, if I tell you that the last conversation that I had with Goering on these topics was in November 1937, when Luther, for 2 months, had endeavored to unite Goering and myself, and to induce me to cooperate further with Goering, and maintain my position as Minister of Economics. Then I had a last talk with Goering and, at the end of this talk, Goering said, "But I must have the right to give orders to you." Then I said, "Not to me, but to my successor." I have never taken orders from Goering; and I would never have done it; because he was a fool in economics, and I knew something about it, at least.
Q: Well, I gather that was a culminating, progressive personal business between you and Goering. That seems perfectly obvious.
If I accede to your wish, it is with the expression of deepest gratitude for your so excellent achievements, and in the happy consciousness that, as President of the Reichsbank Directorate, you will make available for the German people and me, for many years more, your outstanding knowledge and ability and your untiring energy. Delighted at the fact that, in the future, also, you are willing to be my personal adviser, I appoint you, as of today, a Reich Minister.
From Schacht’s IMT testimony: Unfortunately, I never had any influence on the Fuehrer’s actions and decisions. I had influence, only insofar as he did not dare to interfere with me, in my special financial and economic policies. But this lack of influence of all members of Hitler’s entourage has already been mentioned by various witnesses, and so much has been said about it that I think I need not take up the Tribunal’s time with any further statements on that subject.
From the IMT testimony of Hans Bernd Gisevius: I witnessed, in detail, the struggle for his release as Reich Minister of Economy. On the one side, there was his attempt to be released from the Ministry, and I think I am right in saying that this was not so easy. Schacht told Lammers one day that, if he did not receive the official notification of his release by a certain date, he would consider himself dismissed, and inform the press accordingly. On that occasion, scores of people implored Schacht not to resign. Throughout those years, whenever a man wanted to resign from his post, there was always the question whether his successor might not steer an even more radical course. Schacht was implored not to leave, lest radicalism should gain the upper hand in the economic field, also. I only mention here the name of Ley, as head of the labor front. Schacht replied that he could not bear the responsibility, but that he hoped he would be able as President of the Reichsbank to keep one foot in, as he expressed it. He imagined that he would be able to have a general view of the overall economic situation and that, through the Reichsbank, he would be able to conserve certain economic political measures. I can testify that many men, who later became members of the opposition, implored Schacht to take that line, and to keep at least one foot in.
Schacht spoke of the defeat of Germany in 1918, as wholly due to Woodrow Wilson’s bringing America into the World War, but said Wilson’s Fourteen Points had been the one great promise of international peace and co-operation, and that every country on both sides had helped to defeat his purpose. I asked him whether he did not think that Wilson, 50 years from now, would be regarded as one of the greatest Presidents the United States has ever had. He evaded an answer and turned his attention to the Japanese-Chinese war, and expressed opposition to Germany’s alliance to Japan." Then, he showed the true German attitude by quoting you: "If the United States would stop the Japanese War and leave Germany to have her way in Europe, we would have world peace . . . .
Schacht meant what the army chiefs of 1914 meant, when they invaded Belgium, expecting to conquer France in 6 weeks, that is domination and annexation of neighboring little countries, especially north and east. Much as he dislikes Hitler’s dictatorship, he, like most other eminent Germans, wishes annexation without war if possible; with war, if the United States will keep hands off . . . .
I did not comment and others, also, failed to make remarks. Schacht meant what the Army Chiefs of 1914 meant, when they invaded Belgium, expecting to conquer France in 6 weeks, namely; domination and annexation of neighboring little countries, especially north and east.
From Schacht’s IMT testimony: I do not know whether I said [that we would have world peace] but, even today, it seems an extremely reasonable statement. I am of the opinion that it was correct ... there were various opinions about the path Germany was to take; mine was a peaceful one . . . . I have already stated that Mr. Dodd was the victim of many misconceptions. In this case, too, he does not say that I said it; he says, "Schacht meant." That was his opinion, which he attributed to me. I never said that . . . . [Dodd was] a friendly observer who continually misunderstood; Ambassador Henderson has proved that in his book ... he misunderstood my attitude.