The Nizkor Project: Remembering the Holocaust (Shoah)

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Q. Very well. In so far as you know, was this attitude of
yours, the attitude of a pacifist, and of some one who was
definitely opposed to the extension of living space in
Europe, known abroad?

A. As long as I was President of the Reichsbank - that is to
say, from March, 1933 - and I am, of course, only talking
about the Hitler regime - my friends and acquaintances
abroad were fully informed about my attitude and views. I
had many friends and acquaintances abroad, not only because
of my profession but also outside of that; and particularly
in Basle, Switzerland, where we had our monthly meeting at
the International Bank, all the presidents of the issuing
banks of all the great and certain neutral countries met,
and I always took occasion at all these meetings to describe
the situation in Germany to these gentlemen.
Perhaps I may at this point refer to the so-called
conducting of foreign conferences or conversations. If one
is not allowed to talk to foreigners any more, then one
cannot, of course, reach an understanding with them. Those
silly admonitions, that one had to avoid contact with
foreigners, seem entirely uncalled-for to me, and if the
witness Gisevius deemed it necessary the other day to
protect his dead comrades, who were my comrades too, from
being accused of committing high treason, then I should like
to say that I consider it quite unnecessary. Never, at any
time, did any member of our group betray any German
interests. On the contrary, we fought for the interests of
Germany, and to prove that, I should like to give you a good

After we had occupied Paris, the files of the Quai d'Orsay
were confiscated and were carefully scrutinised by officials
from the German Foreign Office. I need not assure you that
they were primarily looking for proof whether there were not
so-called defeatists circles in Germany which had unmasked
themselves somewhere abroad. All the files of the Quai
d'Orsay referring to my person and, of course, there were
records of many discussions which I had had with Frenchmen,
were examined by the Foreign Office officials at that time,
without my knowing it.

One day - I think it probably happened in the course of 1941
- I received a letter from a German professor who had
participated in this search carried out by the Foreign
Office. I shall mention the name so that, if necessary, he
can testify. He is a Professor of Finance and National
Economy, Professor Stueckenbeck of Erlangen, and he wrote me
that it this investigation ...

THE PRESIDENT: The Tribunal cannot see any point in this, so
far as this trial is concerned. In any event, if the
defendant says that he did not in any way give away the
interests of Germany, surely that is sufficient. We do not
need all the details about it. What it has to do with this
trial, I do not know.

DR. DIX: I think, your Lordship, that that was not the point
of the state-

                                                  [Page 419]

ment. What he wants to say is that capable men abroad knew
him and were acquainted with the fact that he was certainly
a man of peace and not a man who prepared aggressive wars,
and that applies even to the period of rearmament.

THE PRESIDENT: But he said that five minutes ago.

DR. DIX: I do not think the question of Professor
Stueckenbeck is so important, but it certainly seems
pertinent to me what Ambassador Davies said about his
conversation with the Foreign Commissar of the Soviet
Republic, Litvinov. This is contained in Exhibit 18 of my
document book. It is Page 43 of the German text, and Page 49
of the English text. May I read one paragraph, and then ask
Schacht briefly whether that statement of Ambassador Davies
corresponds to his recollection? It is Davies' report - I
beg your pardon. It isn't a report; it is an extract from
his book "Mission to Moscow." It is a report to the
Secretary of State in the United States. The passage is on
Pages 108 and 109.

  "In accordance with the plans made. I visited Foreign
  Kommissar Litvinov. Before leaving for the States, I
  presented my respects to him. I then stated that the
  European situation in its elementals looked simple, and
  that it was difficult to understand why the statesmanship
  of Europe could not provide that England, France,
  Germany, Italy, and Russia should agree to preserve the
  territorial integrity of Europe and, through trade
  agreements, provide Germany with raw materials, thereby
  giving a guarantee that she could live. They would
  relieve the peoples of Europe and the world of those
  terrific burdens of armament and relieve the world of the
  fear of catastrophic war. The prompt rejoinder coming
  from Litvinov was: 'Do you think that Hitler would ever
  agree to anything like that?' I said that I didn't know
  that, but that in my opinion there was a considerable
  circle of influential and responsible men in Germany who
  would understand such a train of thought. Litvinov, the
  Foreign Kommissar, replied that he thought that this
  might be the right way and that Schacht was such a man.
  He did not believe, however, that they could prevail
  against Hitler and the political and military forces
  dominant in Germany."

And now I ask you, do you remember that conversation with

A. I think there must be a mistake. I did not speak to
Davies about this I spoke to Litvinov. This is a report of
Davies to the Secretary of State, about which I did not

Q. Yes, you're perfectly right.

It has been repeatedly emphasised by the prosecution that
your knowledge of Hitler's intentions of war resulted also
from your being Plenipotentiary for War Economy and a member
of the Reich Defence Counsel. Goering has made a detailed
statement on it. Have you anything new to add to Goering's

A. I think the witness Lammers has also talked about it. I
should like merely to confirm that the first Reich Defence
Counsel of 1935 was nothing other than the legal
justification of a committee which existed before 1933, made
up of ministerial officials who were supposed to deal with
economic measures as well as administrative measures, which
might have to be taken in the event of a threat of war
against Germany.

Q. How often did you have a meeting with the Minister of War
and the Plenipotentiary for Administration?

A. This famous triumvirate, this three-man board described
by one of the prosecutors as the cornerstone of war policy,
never met at all, and it is no wonder that we lost the war,
if that was the cornerstone.

Q. The prosecution have also referred to the report of the
Ministry of War regarding the task of the Reich Defence
Counsel of 1934. It is Document

                                                  [Page 420]

EC-128, Exhibit USA-623. Have you anything in particular to
add to that?

A. Yes, I should like to have permission to quote one very
brief paragraph. I see there are only two sentences. This
report contains the following statement:-

Referring to the first World War and the experiences made
during it, that is 1914 to 1918, and I quote - I shall have
to do it in English since I only have the English:-

  "At that time we were able to extend our bases for raw
  materials and production towards the West: Longwy, Brie,
  Tourcoing, Roubaix, Antwerp (textiles), and towards the
  East (Lodz) and South-east (mines in Serbia and Turkey)
  (mineral oils in Roumania). Today we have to reckon with
  the possibility of dealings thrown back in our own
  country and even of being deprived thereby of most
  valuable industrial and raw material in the West and in
  the East."

I think that if anyone wanting to prepare an aggressive war
had calculated in September, 1934, that one would have to
protect oneself against the possibility of such a situation
arising, this is the best proof that there can be no
question of an aggressive war.

Q. In that connection, under the heading of "peaceful
efforts," can you perhaps tell the Tribunal what your
peaceful efforts were, to have the reparations clauses of
the Versailles Treaty modified or even abolished?

A. From the very first moment, after the reparations were
determined in 1921 or so, I fought against this nonsense
with the argument that the carrying out of those reparations
would throw the entire world into economic chaos. One
cannot, during one generation, pay yearly 120 billions of
marks - or about 2 billions of marks, as it would be at that
time ...

Q. We would like to make it brief. Will you please talk only
about your peaceful efforts and not about national economy?

A. All right, I won't talk about national economy.

I fought against it and, as time went by, I did succeed in
convincing the people of almost all the countries that this
was sheer nonsense. Therefore in July, if I'm not mistaken,
of 1932, the then Reich Chancellor Papen was in a position
to put his signature to an agreement at Lausanne, which
reduced reparations, de jure, to an approximate sum of three
billions, but which, de facto, cancelled reparations

Q. Did you then continue your definitely peaceful efforts in
other fields? You've already touched upon the negotiations
in Paris regarding the colonial questions. I wonder if you
have anything to add to that in this connection?

A. I don't remember at the moment how far I had gone at the
time, but I think I reported on the negotiations in detail,
so I need not repeat myself.

Q. George Messersmith, the often-mentioned former Consul
General of the United States in Berlin, states in his
affidavit, Document EC-451, Exhibit USA-626, to which the
prosecution has referred, that he is of the opinion that the
National Socialist regime could not have been in a position
to remain in power and build up its war machine if it had
not been for your activity. At the end of the case for the
prosecution, the prosecution presents that thesis of
Messersmith. Therefore, I should like you to make a
statement on this subject.

A. I don't know whether that completely unsubstantiated
private opinion of Mr. Messersmith has any value as
evidence. Nevertheless, I should like to contradict it by
means of a few figures. I had stated earlier that until 31
March, 1938, the Reichsbank had given twelve billions; that
is to say, during the first fiscal year, about two and a
quarter billions, and during the subsequent years, three and
a quarter billions per annum. During those years - the co-
defendant Keitel was asked about that when he was examined

                                                  [Page 421]

here - the armament expenditures, as Keitel said, amounted
to the following:-

In the fiscal year 1935-36 - 5 billions.
In the fiscal year 1936-37 - 7 billions.
In the following fiscal year - 9 billions.

And at that stage the assistance from the Reichsbank ceased.
In spite of that, during the following year and without any
assistance from the Reichsbank, the expenditure for armament
increased to eleven billions, and in the following year it
climbed to twenty and a half billions.

It appears, therefore, that even without the financial
genius of Herr Schacht, they managed to get hold of the
cash. Just how they did so is another question.

Q. I duly put these figures to the witness Keitel. I don't
think that the Tribunal had the document at the time. It is
now available and has the Exhibit number 7. It is Page 15 of
the German text and Page 2l of the English text. Herr Keitel
could, of course, only refer to the first column, that is to
say, total expenditure, but there is a second and a third
column, in this balance sheet, and these two columns are
calculations made by Schacht, calculations regarding what
was accomplished with the help, and without the help of the

I don't intend to go through it in detail now. I should
merely like to have your permission to ask Dr. Schacht
whether the figures calculated by him in column 2 and 3 of
the document were calculated correctly.

A. I have the copy of the document before me. The figures
are absolutely correct and again I want to declare that they
show that, during the first year after the Reichsbank had
discontinued its assistance, no less than five and a quarter
billions more were spent that is to say, a total of eleven

Q. Up to now you have stated to the Tribunal that you were
actively against a dangerous and extensive rearmament, and
you showed that by tying up the money bag, did you oppose
excessive rearmament in any other way, for instance, by
giving lectures and such?

A. Many times I spoke not only before economists and
professors, who were my main audience but I often spoke upon
the invitation of the Minister of War and the head of the
Army Academy, before high ranking officers. In all these
lectures I continually referred to the financial and
economic limitations to which German rearmament was subject
and I warned against excessive rearmament.

Q. When did you first gather the impression that the extent
of German rearmament was excessive and exaggerated?

A. It is very difficult to give you a date. Beginning in
1935, I made continuous attempts to slow down the speed of
rearmament. On one occasion Hitler had said - just a moment,
I have it - that until the spring of 1936 the same speed
would have to be maintained. I adhered to that as much as
possible, although, beginning with the second half of 1935,
I continuously applied the brake. But after 1935 I told
myself that, since the Fuehrer himself had said it, after
the spring of 1936 the same speed would no longer be
necessary. This can be seen from Document PS-1301, in which
these statements of mine are quoted, statements which I
communicated to the so-called Smaller Cabinet Council
("Kleiner Ministerrat"). Goering contradicted me during that
meeting, but I of course maintain the things which I said at
the time.

After that I constantly tried to make the Minister of War do
something to slow down the speed of rearmament, if only in
the interest of general economy, since I wanted to see the
economic system working for the export trade. Proof of the
fact of just how much I urged the Minister of War is
contained in my letter dated 24 December, 1935, which I
wrote him when I saw the period desired by Hitler coming to
an end, and when I was already applying the brake. It has
also been presented by the prosecution as Document PS-1301.
In the English version of the document it is on Page 25.

                                                  [Page 422]

I beg to be allowed to quote very briefly - all my
quotations are brief - from that document. I wrote a letter
to the Reich Minister of War, and I quote:-

  "I gather from your letter dated 29 November" - and then
  come the reference numbers - "that increased demands by
  the armed forces for copper and lead are to be expected,
  which will amount to practically double the present
  consumption. These appear only to be current demands,
  whereas the equally urgent demands to be expected are not
  contained in the figures. You are expecting me to obtain
  the necessary foreign currency for these demands, and to
  that I respectfully reply that under the existing
  circumstances I see no possibility of doing so." End of

In other words, Blomberg is asking that I should buy raw
materials with foreign currency, and I am stating quite
clearly that I do not see any possibility of doing so.

The document goes on to say - and this is the sentence
regarding the limit up to 1 April:-

  "In all the conferences held with the Fuehrer and Vice
  Chancellor up to now, as well as with the leading
  military departments, I have expressed my conviction that
  it would be possible to supply the necessary foreign
  currencies and raw materials for the existing degree of
  rearmament until 1 April, 1936. Despite the fact, that
  due to our cultural and agrarian policies, which are
  being repudiated all over the world, this has been made
  extremely difficult for me, and continues to be
  difficult, I still hope that my original proposal may be
  carried out."

That is to say, that I thought this proposed programme could
be carried out up to 1 April, but not over and beyond that.

Q. It is a fact that Minister of Transport, Dortmueller, was
trying to raise credits for railway purposes. What was your
attitude as president of the Reichsbank toward this?

A. During a conference between the Fuehrer, Dortmueller, and
myself, at which the Fuehrer strongly supported
Dortmueller's demands, I turned that credit down
straightway, and he did not get it.

Q. The meeting of the so-called Smaller Cabinet Council,
presided over by Goering, of 27 May, 1936, has been
discussed here. Representatives of the prosecution contend
that intentions of aggressive war became apparent from that
meeting. Did you have any knowledge of that meeting?

A. What was the date, please?

Q. 27 May, 1936.

A. No. I was present during that conference, and I see
nothing in the entire document pointing to an aggressive
war. I have studied the document very carefully.

Q. It has furthermore been stated against you what is
contained in the report of Ambassador Bullitt, Document M-
151, Exhibit USA-70, dated 23 November, 1937. You have heard
of course that the prosecution is also drawing the
conclusion from that report that there were aggressive
intentions on Hitler's part.

Will you please make a statement about that?

A. 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 intention 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. Bullet says the
following with reference to me in his report about this

  "Schacht then went on to speak of the absolute necessity
  for doing something to produce peace in Europe." End of

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