Chapter XXV: Part 25

DR. DIX: We have now reached the stage of tension of technical differences between you and Göring, the tension between you and Hitler regarding your functions as Minister of Economics. What were your thoughts at the time about resigning from your office as Minister of Economics? Was it possible for you to resign? Please do not repeat anything that Lammers and other witnesses have already told us about the impossibility of resigning. Please talk only about your own special case and what you yourself did.

SCHACHT: First of all, I tried to continue my own economic policy, in spite of the fact that Göring 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 Göring 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.

DR. DIX: When you say “drastic measures” do you mean your so-called sit-down strike?

In this connection I want to submit to the Tribunal Exhibit Number Schacht-40 of my document book, an affidavit from another former colleague of Dr. Schacht in the Reich Ministry of Economics, Kammerdirektor Dr. Asmus. On Page 180 of the English version of this long affidavit there is a brief passage. I quote:

“When this was found to be unsuccessful”—it means his
fight—“and when developments continued along the course which
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...”

THE PRESIDENT: Dr. Dix, is it necessary to trouble the Tribunal with all this detail? There is no dispute that he did resign, and the only thing that he has got to explain is why he continued to be a Minister. The Prosecution have given evidence about his resignation and about the conflict between him and the Defendant Göring. What is the good of going into all the detail of it, as to this sit-down strike and that sort of thing? That doesn’t interest the Tribunal.

DR. DIX: He did not remain a Minister at that time. He resigned as Minister.

THE PRESIDENT: I thought he had remained a Minister until 1943.

DR. DIX: Minister without Portfolio, yes.

THE PRESIDENT: I didn’t say Minister with Portfolio, I said Minister.

DR. DIX: Yes, but there is a difference, but I shall come to that later. I understood you to mean an active Minister, but I shall not go into that now. It was a misunderstanding. Anyway, I have already finished that. I was merely trying to show how difficult it was to resign.

[_Turning to the defendant._] We now come to the manner in which you were released. Have you anything to add to the statements made by Lammers in this connection or not?

SCHACHT: 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.

If the Tribunal allow, I shall read it very briefly. There are two or three sentences. Herr Speer informed me of the following: “I was on the terrace of Berghof on the Obersalzberg, and I was waiting to submit my building plans. In the summer of 1937 when Schacht came to the Berghof...”

MR. JUSTICE JACKSON: [_Interposing._] Speer is present in the room. For one defendant to testify as to a conversation with another defendant is a very convenient way of getting testimony without access to cross-examination, but it seems to me that it is a highly objectionable method. I object to this on the ground that it has no probative value to testify to a conversation of this character when the Defendant Speer is in the courtroom and can be sworn and can give his testimony. He sits here and is available.

THE PRESIDENT: What is the subject of the conversation?

DR. DIX: The subject of this conversation is a matter which concerns the Defendant Schacht. It is a statement of Hitler regarding Schacht; it is not a matter which concerns the Defendant Speer. Therefore I consider it expedient for him, since it is a matter which concerns Schacht, to be able to make a statement about it. I would, of course, consider it more appropriate that he should not read something which Speer has written to him, but that he should give his own account of what happened between Hitler and Schacht and merely say, “I heard that from Speer.” That appears to be better than...

THE PRESIDENT: Very well, Dr. Dix, you may give that.

DR. DIX: [_Turning to the defendant._] Will you please not read, then, but tell of this incident and say you got it from Speer?

MR. JUSTICE JACKSON: That is even more objectionable to me than to have a written statement from Speer. If we are to have Speer’s testimony, it at least should be Speer’s and not a repetition of a conversation between the two defendants. If Speer has made a written statement, it can be submitted to us in the ordinary course.

This is the second document that we have not had the privilege of seeing before it has been used here; and it seems to me that if this is a document signed by Speer—which I don’t understand it to be—if it is, that is one thing. We can then see it and perhaps it can be used. If it is a conversation, I should prefer Speer’s version.

DR. DIX: May I add something? The question of procedure is not of basic importance for me here. In that case it can be discussed when Speer is examined. However, I do not know whether Speer is going to be called; probably he will be. Actually it would be better for us to hear it now, but I leave it to the Tribunal to decide. It is not a question of great importance to me.

THE PRESIDENT: The Tribunal will allow the evidence.

DR. DIX: [_Turning to the defendant._] Well then, without reading, please describe the incident.

SCHACHT: The gentlemen on the terrace, among them Speer, heard this discussion, which was conducted in very loud tones. At the end of the discussion Hitler came out on the terrace and...

THE PRESIDENT: Just a moment. [_There was a brief pause in the proceedings._] Very well, Dr. Dix, go on.

SCHACHT: 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.

DR. DIX: Well then, after you had left your position as Minister of Economics you were still left authority as Reichsbank President. Were you approached by Hitler or the Minister of Finance in your capacity as President of the Reichsbank and asked for credit?

SCHACHT: After the Reichsbank had discontinued giving credits, on 31 March 1938, the Reich Minister of Finance of course received more urgent demands for money and toward the end of that year he found himself in the awkward situation of not being able to pay even the salaries of the civil servants from the treasury. He came to me and asked me to grant him a special credit. According to its charter and laws the Reichsbank was entitled and to a certain extent obliged, but actually only entitled, to advance to the Reich up to 400 million marks per annum. The Reich Minister of Finance had received these 400 million marks and he was asking, over and above that, for further credits; the Reichsbank refused to give him these credits. The Reich Minister of Finance had to go to the private banks and all the large banks together gave him a credit of a few hundred million marks. However, the Reichsbank did not participate in this credit.

DR. DIX: If you as President of the Reichsbank turned down those credits, then it seems there was nothing for it but to print more notes. Did Hitler or anyone else suggest to you that the note printing presses should be set in motion?

SCHACHT: After the events of November 1938 I paid one more visit to London, in December, to attend a conference regarding the financing of the Jewish emigration from Germany in an orderly manner—a thing which I myself had suggested. On that occasion I also talked with Prime Minister Chamberlain. On 2 January 1939 I arrived at the Berghof in Berchtesgaden to report to Hitler about these matters. On that occasion we, of course, also got to talk about the financial needs of the Reich. I still refused to give credit to the Reich, and pointed out the very difficult financial situation which called for, or should have called for, a reduction of State expenditure and thus of armament expenditure.

In particular, I pointed out that at the beginning of December the first instalment of the so-called Jewish fine—which had been imposed on the Jews after the murder of Herr Vorn Rath in Paris and which had been collected to the extent of 250 million marks at the beginning of December—that this first instalment of 250 million marks had not been received entirely in the form of cash, but that the Reich Minister of Finance had had to agree to accept a considerable part of it “in kind,” as the English say, because it was not possible to make liquid the cash necessary for this payment. Hitler replied: “But we can circulate notes on the basis of these goods. I have looked into the question of our future financial policy very carefully and when I get back to Berlin in a few days I shall discuss my plans with you and the Minister of Finance.”

I saw at once that it was Hitler’s intention to resort to the printing of notes to meet this expenditure with or without the necessary cover, but at any rate against certain securities. The danger of inflation was now definitely imminent. And since I realized at once that this was the point where I and the Reichsbank had to say “stop,” I replied to him, “Very well, in that case I will get the Reichsbank to submit a memorandum to you, setting out the attitude of the Reichsbank to this problem and which can be used at the joint meeting with the Finance Minister.”

After that I went back to Berlin and informed my colleagues in the Reichsbank Directorate. We saw, to our personal satisfaction, that here was an opportunity for us to divorce ourselves definitely from that type of policy.

The memorandum dated 7 January which the Reichsbank Directorate then submitted to Hitler has, I think, also been submitted as evidence by the Prosecution.

In order to explain the statements which the Reichsbank Directorate made to Hitler in this decisive moment regarding further State expenditure and especially armament expenditure, I ask permission to read only two very brief sentences from this memorandum. It says, and I quote:

“Unrestrained public expenditure constitutes a definite threat
to our currency. The unlimited growth of government expenditure
defies any attempts to draw up a regulated budget. It brings
State finances to the verge of ruin despite a tremendous
increase in taxes, and it undermines the currency and the
issuing bank.”

Then there is another sentence, and I quote:

“...if during the two great foreign political actions in Austria
and the Sudetenland an increase in public expenditure was
necessary, the fact that after the termination of these two
foreign political actions a reduction of expenditure is not
noticeable and that everything seems rather to indicate that a
further increase of expenditure is planned, makes it now our
absolute duty to point out what the consequences will be for our
currency.

“The undersigned Directors of the Reichsbank are sufficiently
conscious of the fact that in their co-operation they have
gladly devoted all their energy to the great aims that have been
set, but that a halt must now be called.”

DR. DIX: This memorandum has already been submitted by the Prosecution under the Document Number EC-369, but it is being submitted again as Exhibit Schacht-24 in our document book, Page 70 of the English text, and Page 63 of the German text.

I shall have to put various questions to Dr. Schacht on that memorandum, but I think that perhaps there is not time now and that I should do so tomorrow.

THE PRESIDENT: If you must, Dr. Dix; but do you think that is very important? At any rate, you had better do it tomorrow, if you are going to do it at all.

DR. DIX: Yes.

THE PRESIDENT: Dr. Siemers?

DR. SIEMERS: Yes, Sir.

THE PRESIDENT: Dr. Siemers, can you inform us whether those extracts are the same as the extracts which were refused in the case of the Defendant Ribbentrop?

DR. SIEMERS: I have made a comparison, and I can hand it to the Tribunal in writing. Some documents are the same, some do not tally, and some are missing. I have done that in writing.

THE PRESIDENT: Thank you.

The Tribunal will adjourn.

[_The Tribunal adjourned until 2 May 1946 at 1000 hours._]

ONE HUNDRED AND NINETEENTH DAY
Thursday, 2 May 1946

_Morning Session_

THE PRESIDENT: Dr. Siemers, the Tribunal would like to know exactly what your letter means, which they received from you, relating to the following documents which the letter says have been withdrawn. What I want to know is, does it mean that they are not to be translated? Let me read you the numbers: 18, 19, 48, 53, 76, 80, 81, 82, 86, and 101. Now, does your letter mean that those documents are not to be translated?

DR. SIEMERS: No, Your Lordship; that means that the British Delegation informed me yesterday morning that the objections against those documents on the part of the British Delegation are withdrawn.

THE PRESIDENT: I see.

DR. SIEMERS: I had written the letter on 30 April, in the afternoon, after I had had a conversation with Sir David. The following morning I was informed...

THE PRESIDENT: We won’t bother with that. You say that their objections no longer exist. If they agree to that, well and good.

SIR DAVID MAXWELL-FYFE: My Lord, apparently there seems to have been some misunderstanding about three of them, Numbers 80, 101, and 76. The others were not objected to.

THE PRESIDENT: Yes.

SIR DAVID MAXWELL-FYFE: My Lord, on 76 there seemed to be some misunderstanding between Dr. Siemers and myself. I understood that he did not want to persist in the legal report on the _Altmark_ incident, and I think Dr. Siemers thought that I wasn’t persisting. However, I thought Dr. Siemers was withdrawing that.

THE PRESIDENT: Yes. Well, then, are you still objecting to that?

SIR DAVID MAXWELL-FYFE: I am still objecting to it if it is not withdrawn, My Lord. However, the other ones in the list Your Lordship mentioned—that is Numbers 18, 19, 48, 53, 81, 82, and 86—there is no objection to.

THE PRESIDENT: Yes.

DR. SIEMERS: Concerning Document 76, I agree with Sir David. Number 76 can be struck out, as far as I am concerned.

THE PRESIDENT: Very well. That’s all I wanted to know.

DR. SIEMERS: Number 80 about which I have spoken in detail with the British Delegation...

THE PRESIDENT: You need not tell me about it.

DR. SIEMERS: I assumed there would be no objection. I would like to ask that it be admitted in any case.

THE PRESIDENT: Yes, that is right. In order that the Translation Division should get on as soon as possible, the Tribunal has decided upon these documents and the only questions upon which the Tribunal has decided is that they shall be translated. The question of their admissibility will be decided after they have been translated, and I will take them in the categories of objection which are set out in Sir David’s memorandum.

In Category A, the first category, Number 66 will be allowed. Number 76 as Dr. Siemers has now said, goes out. Numbers 101 to 106 will be allowed, the rest are disallowed in A. In B the following documents will be allowed: Numbers 39, 63, 64, 99, and 100. And, of course, Numbers 102 to 107, which are allowed under A. The rest will not be allowed.

Category C: The following will be allowed: Numbers 38, 50, 55, and 58. The remainder are not allowed.

Category D: The following will be allowed: Numbers 29, 56, 57, 60, and 62.

Category E: The following will be allowed: Numbers 31, 32, 36, 37, 39, 41, and of course 99 and 101 which have already been allowed.

In the last category, Category F, the Tribunal has very great doubts as to the relevance of any of the documents in that category, but it will have them all translated with the exception of Document 73.

LT. COL. GRIFFITH-JONES: My Lord, I wonder whether the Tribunal would allow me to mention the document numbers of the additional extracts from _Der Stürmer_ which were put in cross-examination of Streicher. I had the numbers ready to present at a convenient time.

THE PRESIDENT: The exhibit numbers?

LT. COL. GRIFFITH-JONES: Yes.

THE PRESIDENT: You mean read them?

LT. COL. GRIFFITH-JONES: With the permission of the Tribunal, I have proposed to hand in that schedule, which is in effect a catalogue or index to the two bundles which the Tribunal had—Bundle A and Bundle B—and I proposed then putting this schedule in as an exhibit itself, which will become GB-450, (Document Number D-833), and if the Tribunal agrees, that would save reading any numbers out.

THE PRESIDENT: Yes.

LT. COL. GRIFFITH-JONES: There is another request I would make. The original of the newspaper, _Israelitisches Wochenblatt_, was put in, or has been put in. Those volumes I have borrowed from a library, and I was going to ask the Tribunal’s permission to have the extracts photographed and to substitute with the Tribunal’s Secretariat the photostats, and then take back the originals so that they might be returned.

THE PRESIDENT: There seems no objection to that.

LT. COL. GRIFFITH-JONES: I am very much obliged.

THE PRESIDENT: You have no objection to that, Dr. Marx?

DR. MARX: No, Mr. President, I have no objection to that. I reserve the right to submit some counter documents if it should be necessary. But the presentation of these documents is in accordance with what Colonel Griffith-Jones stated in the course of the proceedings—if they are submitted...

THE PRESIDENT: You have a copy of this document here, this exhibit.

DR. MARX: Yes.

THE PRESIDENT: I am asking you whether you had any objection to the original of the Jewish newspaper being returned...

DR. MARX: No.

THE PRESIDENT: ...after it is photographed.

DR. MARX: No, I have no objection to that.

THE PRESIDENT: Thank you.

LT. COL. GRIFFITH-JONES: I am very much obliged.

THE PRESIDENT: Now, Dr. Dix?

DR. DIX: Dr. Schacht, I believe you still had to supplement your answer to a question I put to you yesterday. I put to you the point that different memoranda, letters, _et cetera_ from you to Hitler were full of National Socialist phraseology. I said you dealt with letters and memoranda from the date of the seizure of power until later when you went into opposition. The Prosecution, however, specifically in the oral presentation of the charges, as I remember it, referred to at least one letter which you addressed to Hitler before the seizure of power in November 1932, and there is in the files another letter of similar contents of August 1932. I think you should state your position with respect to these two letters, supplementing your answer to my question.

DR. SCHACHT: I explained to you yesterday already that up to the decisive election of July 1932, I had in no way intervened in the development of the National Socialist movement, but remained completely aloof from it. After that movement achieved its overpowering success in July 1932, of which I spoke yesterday, I foresaw very clearly the development which would now result. According to the principles of the democratic political concept there was only one possibility, namely, that the leader of that overwhelmingly large party would now have to form a new government. I rejected from the first the other theoretical possibility of a military government and a possibly resulting civil war, as being impossible and incompatible with my principles.

Therefore, after I had recognized these facts I endeavored in everything to gain influence over Hitler and his movement, and the two letters which you have just mentioned were written in that spirit.

DR. DIX: What did you know about Hitler’s plans against Austria?

SCHACHT: I never knew anything about plans against Austria. Nor did I know in detail the plans Hitler had for Austria. I only knew—like the majority of all Germans—that he was in favor of an Anschluss of Austria with Germany.

DR. DIX: What did you know about his plans against Czechoslovakia?

SCHACHT: I knew nothing of his plans against Czechoslovakia until about the time of the Munich Conference.

DR. DIX: Did you, after the Munich Conference, that is to say, after the peaceful, so far peaceful settlement of the Sudeten question, hear a remark of Hitler’s about Munich which was of importance in your later personal attitude toward Hitler? Will you tell the Tribunal the remark which you heard?

SCHACHT: May I say first that, according to my knowledge of conditions at that time, Hitler was conceded in Munich more than he had ever expected. According to my information—and I expressed this also in the conversation with Ambassador Bullitt at that time—it was Hitler’s purpose to gain autonomy for the Germans in Czechoslovakia. In Munich the Allies presented him with the transfer of the Sudeten-German territories on a silver platter. I assumed, of course, that now Hitler’s ambition would be more than satisfied and I can only say that I was surprised and shocked when a few days after Munich I saw Hitler. I had no further conversation with him at that time, but I met him with his entourage, mostly SS men, and from the conversation between him and the SS men I could only catch the remark: “That fellow has spoiled my entry into Prague.” That is to say made it impossible.

Apparently he was not satisfied with the great success which he had achieved in foreign politics, but I mentioned when I spoke about it yesterday the fact that I assumed from that remark that he lacked the glory and a glamorous staging.

DR. DIX: And what were your feelings in regard to your whole political attitude towards Hitler after Munich?

SCHACHT: In spite of the foreign political success I regretted very deeply, and so did my close friends, that by this intervention on the part of the Allied Powers, our attempt to remove the Hitler regime was ruined for a long time to come—we did not know at that time of course what would happen in the future—but, naturally, at that moment we had to resign ourselves to it.

DR. DIX: What did you know about Hitler’s plans against Memel?

SCHACHT: I knew nothing at all and never heard anything about it. As far as I know, I learned of the annexation of Memel by Germany on my trip to India, which I had already started at that time.

DR. DIX: And since you were in India at that time, you, of course, heard nothing either about the negotiations, _et cetera_, which preceded the attack on Poland?

SCHACHT: I had no knowledge about that and therefore I also knew nothing of the May meeting of 1939 which has been discussed several times. In the beginning of March I left Berlin and then stayed for some time in Switzerland; at the end of March I set out for India via Genoa, and so I learned nothing at all about the Hacha affair, that is the establishment of the protectorate in Czechoslovakia, nor of Memel, nor of Poland, since I did not return from the trip to India until the beginning of August.

DR. DIX: The invasions of Belgium, Holland, Norway, and Denmark have been taken up here. Did you approve of these measures and actions?

SCHACHT: Under no circumstances.

DR. DIX: Were you ever able to express that disapproval anywhere and how?

SCHACHT: Before the invasion of Belgium I was visited on the order of the Chief of the General Staff, Halder, by the Quartermaster General, the then Colonel, later General Wagner who after the collapse committed suicide. He informed me of the intended invasion of Belgium. I was shocked and I replied at that time, “If you want to commit that insanity too, then you are beyond help.”

THE PRESIDENT: What time?

SCHACHT: Before the march into Belgium. Exactly when it was I could not say. It may have been already in November 1939. It may have been in April 1940. I no longer know exactly when it was.

DR. DIX: Even though you did not approve of that action, Germany was after all engaged in a life and death struggle. Did not that cause you to put your active co-operation at her disposal, since you were still Minister without Portfolio, though you no longer held a special office?

SCHACHT: I did not do that.

DR. DIX: Did anyone ask you to do that?

SCHACHT: The visit, which I have just mentioned, of Quartermaster General Wagner, upon order of the Chief of General Staff Halder, was intended to persuade me to act in Germany’s interest during the expected occupation of Belgium. I was to supervise and direct currency, finance, and banking matters in Belgium. I flatly refused that. Later I was approached again by the then Military Governor of Belgium, General Von Falkenhausen, for advice concerning the Belgian financial administration. I again refused to give advice and did not make any statements or participate in any way.

DR. DIX: When did you for the first time...

SCHACHT: I could perhaps relate another instance when I was approached. One day, shortly after America was drawn into the war, I received a request from the newspaper published by Goebbels, that, on account of my knowledge of American conditions, I should write an article for _Das Reich_, to assure the German people that the war potential of the United States should not be overestimated. I refused to write that article for the reason that precisely because I knew American conditions very well, my statement could only amount to the exact opposite. And so I refused in this instance also.

DR. DIX: When did you hear for the first time of the meeting which we call here simply the Hossbach meeting, or the meeting concerning the Hossbach protocol?

SCHACHT: To my great surprise, I was informed of that meeting on 20 October 1945, here in my cell, 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.

DR. DIX: Did you take part in similar conferences which were preparatory to attacks, for instance the meeting of November 1940 in which the attack on Russia was discussed? I do not wish to be misunderstood—the Speer document which you spoke of yesterday discusses an attack which according to Hitler was threatened by Russia. I am speaking now of discussions in which the subject was an attack on Russia.

SCHACHT: The fear of an attack from Russia dates back to the fall of 1936 and therefore has as yet nothing to do with the war. I never took part in any conference which indicated intentions of war, consequently not in the conference on the intended attack on Russia, and I never heard anything about it.

DR. DIX: Does that also apply to the meeting of May 1941?

SCHACHT: At the moment, I do not know which meeting that is, but I did not in any way take part in any meeting in May 1941, as during the entire period when I was Minister without Portfolio, I never took part in any official conference.

DR. DIX: Then you also did not get any information about the conferences which the Japanese Foreign Minister Matsuoka had in Berlin?

SCHACHT: I did not have the slightest knowledge of the Matsuoka conference except what may perhaps have been said on the radio or in the press.

DR. DIX: Mention has been made in some way that you at one time had made available 200,000 marks for Nazi propaganda purposes in Austria. Is there any truth in this?

SCHACHT: I have not the slightest knowledge of that.

DR. DIX: Now we come to your dismissal as President of the Reichsbank. As you have heard, the Prosecution asserts that you finally brought about your own dismissal in order to evade the financial responsibility. I ask you to reply to that accusation and to tell the Tribunal briefly but exhaustively the reasons and the tactical deliberations leading to your dismissal and that of your assistants. They appear here in the memorandum of the Reichsbank Directorate which has been under consideration several times.

SCHACHT: I should like to divide the question into two parts: The first question is whether I tried to rid myself of my office as President of the Reichsbank. My answer to that question is a most emphatic “yes.” Since the middle of 1938, we in the Reichsbank always considered that if there were no change in policy, we in no event wanted to continue in office, because—and that brings me to the second part of the question—we did not want to assume the responsibility which we were then expected to bear.

For everything which we did previously and for a defensive rearmament in order to achieve equal rights for Germany in international politics, we gladly assumed responsibility, and we assume it before history and this Tribunal. But the responsibility for continuing rearmament which possibly in itself constituted a serious potential danger of war or which would ever aim at war intentionally—that responsibility none of us wanted to assume. Consequently, when it became clear that Hitler was working toward a further increase in rearmament—and I spoke about that yesterday in connection with the conversation of 2 January 1939—when we became aware of that we wrote the memorandum which was openly quoted and is in the hands of this Tribunal as an exhibit. It indicates clearly that we opposed every further increase of state expenditure and would not assume responsibility for it. From that, Hitler gathered that he would in no event be able to use the Reichsbank with its present Directorate and President for any future financial purposes. Therefore, there remained only one alternative; to change the Directorate, because without the Reichsbank he could not go on. And he had to take a second step; he had to change the Reichsbank Law. That is to say, an end had to be put to the independence of the Reichsbank from government decrees. At first he did that in a secret law—we had such things—of 19 or 20 January 1939. That law was published only about 6 months later. That law abolished the independence of the Reichsbank and the President of the Reichsbank became a mere cashier for the credit demands of the Reich, that is to say, of Hitler.

The Reichsbank Directorate did not want to continue along this line of development. Therefore, on 20 January the President of the Reichsbank, the Vice President, and the main financial expert, Reichsbank Director Huelse, were dismissed; three other members of the Directorate of the Reichsbank, Geheimrat Vocke, Director Erhard, and Director Blessing pressed insistently for their resignation from the Reichsbank until it was also granted. Two other members of the Reichsbank Directorate, Director Puhl, whose name has been mentioned here already, and an eighth director, Director Poetschmann, remained in the Directorate even under the new conditions. They were both Party members, the only ones in the Directorate, and therefore they could not easily withdraw.

DR. DIX: That is one accusation which is made by the Prosecution concerning your reasons for writing the memorandum, that is to say, to evade the financial responsibility. The second accusation is that not a word of this memorandum expressly mentions limitation of armaments, but that it essentially treats only matters of currency, technical questions of finance, and economic considerations; and that it was therefore the Dr. Schacht who in his capacity of Bank Director was concerned about the currency, rather than the opponent of rearmament, who made himself heard by this memorandum.

It is necessary that as co-author of the memorandum—as its main author—you state your position with regard to this incriminating interpretation of the memorandum.

SCHACHT: Even at an earlier time I said here that every objection which I made and had to make to Hitler—and that applies not only to myself but to all ministers—could only be made with arguments arising out of the particular department administered.

Had I said to Hitler, “I shall not give you any more money because you intend to wage war,” I should not have the pleasure of conducting this animated conversation here with you. I could then have consulted a priest, and it would have been a very one-sided affair because I would have lain silently in my tomb, and the priest would have delivered a monologue.

DR. DIX: This memorandum is certainly very important, and therefore we have to pause here for a moment. In summarizing—and please check me—I believe I can express your views in this way: This memorandum at the end contained demands such as further means of raising funds by increase of taxation or else by making use of the stock market—both impossible. Taxation could not be increased any more. The stock market had just unsuccessfully attempted a loan.

If these actually impossible demands had been granted, the Reichsbank would have created guarantees that no further funds would be used for one or another form of rearmament. This success was not to be expected; rather you could expect your dismissal. Did my brief but comprehensive summary of this matter express your views correctly?

SCHACHT: That entire letter was composed in such a way that there were only two possible answers to it; either an alteration of financial policy—and that meant a stop to rearmament, which would have amounted to a complete change of Hitler’s policy—or else the dismissal of the Reichsbank President; and that happened. We expected it because at that time I no longer believed that Hitler would change his policy so completely.

DR. DIX: Therefore, the Prosecution are right in saying that your mission ended with your dismissal.

SCHACHT: Hitler certainly confirmed that himself and in the letter of dismissal to me said it expressly. We heard from the testimony of Herr Lammers in this Court that Hitler with his own hand wrote that addition into the letter, that my name would remain connected with the first stage of rearmament. The second stage of rearmament I rejected and Hitler understood that very clearly, because when he received that letter from the Reichsbank he said to those who were present: “This is mutiny.”

DR. DIX: How do you know that?

SCHACHT: The witness Vocke who will, I hope, appear in this Court will testify to that.

DR. DIX: Furthermore, the Prosecution asserted that your exit from the political stage could not be attributed to your policy of opposition to a war but to disputes with Hermann Göring over power and rank. As such, that accusation seems to me to have been refuted already by statements which Göring and Lammers have made up to now. We do not wish to recapitulate. I merely want to ask you whether you have anything to add to the statements made on this subject by Göring and Lammers, or whether you disagree with them.

SCHACHT: In his oral presentation the prosecutor said that throughout the entire material which he had studied he could not find one piece of evidence for my opposition to a policy of war. I can only say in this respect: If someone on account of his shortsightedness does not see a tree on a level plain, there is surely no proof that the tree is not there.

DR. DIX: You have heard from the Prosecution that you are accused of having remained a member of the Cabinet as a Reich Minister without Portfolio. That was also the cause for misunderstanding yesterday. I merely wanted to express yesterday that you had resigned as an active minister and head of a department, that you resigned as Minister of Economy and His Lordship correctly pointed out, that of course you remained a Minister without Portfolio, that is without a special sphere of activity until January 1943. Of that you are accused by the Prosecution. What caused you to remain Reich Minister without Portfolio? Why did you do that? Did you have any particular financial reasons? Excuse my mentioning that, but the trial brief, on Page 5, charges you with that motive.

SCHACHT: I have already repeatedly explained here that my release from office as Minister of Economy encountered very great difficulties, and you have also submitted several affidavits confirming the fact.

Hitler did not, under any circumstances, want it to be known that a break or even so much as a difference of opinion had occurred between one of his assistants and himself. When he finally approved my release, he attached the condition that nominally I should remain Minister without Portfolio.

As regards the second accusation, it is as unworthy as it is wrong. There was a law in Germany that if a person held two public offices he could be paid only for one. Since I was in addition President of the Reichsbank I continuously received my income from the Reichsbank, at first my salary and later my pension; therefore as a minister I drew no salary whatever.

DR. DIX: Did you then, during the entire period of your position as Reich Minister without Portfolio, have any other function to fulfill in that capacity? Did you take any part in important decisions of the Cabinet, did you participate in discussions—in brief, was the Minister without Portfolio just a fancy dress major or was the position one of substance?

SCHACHT: I have already emphasized again and again in this Court—and I can only repeat it again—that after I left the Reichsbank I had not a single official discussion; I did not take part in a single ministerial or official conference and that, unfortunately, it was not possible for me to bring up any subject for discussion; for I had no factual basis or pretext for such a possibility, for the very reason that I had no particular field to administer. I believe that I was the only Minister without Portfolio—there were also a few others—who was not active in any way at all. As far as I know, Seyss-Inquart was undoubtedly Minister without Portfolio; he had his administration in Holland. Frank was Minister without Portfolio and had his administration in Poland. Schirach—I do not know whether he was Minister without Portfolio; I think it has been mentioned once, but I do not know if it is correct—he had his Austrian administration in Vienna. I had nothing further to do with the state administration or in any other way with the State or the Party.

DR. DIX: What about the ordinary course of affairs? Were there perhaps any circulars sent out by Lammers on which you acted?

SCHACHT: On the whole—and I think it is understandable after what I have stated here—I watched carefully for every possibility of intervening again in some way but I remember and state with absolute certainty, that during the entire time until the collapse I received all in all three official memoranda. The numerous invitations to state funerals and similar social state functions really need not be mentioned here as official communications. I did not participate in these occasions either. However, these three instances are interesting. The first time it was a letter from Hitler—pardon, from Himmler—a circular or request or a bill proposed by Himmler who intended to transfer court jurisdiction over the so-called asocial elements of the population to the police, or rather the Gestapo, that is to say, a basic principle of the administration of justice to separate the functions of prosecution and judge...

DR. DIX: Well, that is known, Dr. Schacht. You can assume that is known.

SCHACHT: In regard to this question I immediately assented in the copy of a letter which Reich Minister Frank had sent me in which he took a stand against this basic violation of legal principles, and the bill was not made law. It would indeed have been extremely regrettable, because I am firmly convinced that I myself was a definite anti-social element in Himmler’s sense.

The second instance was a letter concerning some discussions about state property in Yugoslavia, after we had occupied Yugoslavia. I answered that since I had not taken part in the preliminary discussions on the draft of the law I should not be counted upon to assist in this matter.

Finally, the third incident—and this is the most important—occurred in November 1942. Apparently by mistake there came into circulation the draft for a law of the Reich Minister for Air, which contained the suggestion of taking 15 and 16 year old students away from the high school to enlist them for military service in the anti-aircraft defense, the so-called Flakdienst. I answered this letter because it was a welcome opportunity for me to state for once my opinion on the military situation in a long detailed reply which I sent to Göring.

DR. DIX: On the third of November?

SCHACHT: It is a letter of 30 November, which on the second of December I believe was given personally by my secretary to the adjutant of Göring in a closed envelope, with the request that he himself open it.

DR. DIX: One moment, Dr. Schacht.

[_Turning to the Tribunal._] That letter has already been submitted under Document Number 3700-PS by the Prosecution, but it is also in our document book under Exhibit Number 23; Page 66 of the English text and Page 59 of the German text. If we were not so pressed for time, it would have been especially gratifying for me to read this letter here in full. It is a very fine letter. However, I want to take time into consideration and I merely ask you, Dr. Schacht, to state briefly your opinion of its content.

THE PRESIDENT: The Tribunal will read the letter. It isn’t necessary for you to read it now, is it?

DR. DIX: Very well. Well, then, would he speak quite briefly about the letter before the recess or do you not wish to say anything further?

SCHACHT: Yes. I would like to say in this connection, if it is permitted, that to my knowledge this letter has already been read here by the American Chief Prosecutor, that is...

DR. DIX: Read?

SCHACHT: Or mentioned, or at least the most important points were read. I believe it is sufficient if you submit the letter to the Court in evidence.

DR. DIX: Yes, that has been done.

Now, that constituted your entire activity as Reich Minister without Portfolio?

SCHACHT: Yes, that was the end of it.

DR. DIX: Therefore if one wanted to define your position in one word, one would say, just a kind of retired major (Charaktermajor).

SCHACHT: I don’t know what a “Charaktermajor” is, at any rate, I was never a major, but I have always had character.

DR. DIX: But, Dr. Schacht, that is a historical remark about authority conferred by Kaiser Wilhelm, the First as German Emperor on Bismarck.

THE PRESIDENT: I think this is a convenient time to break off.

[_A recess was taken._]

DR. DIX: Dr. Schacht, we spoke of the letter, dated 30 November 1942, to Göring. Did that letter have any consequences?

SCHACHT: Yes, the letter had very considerable consequences. It had the result that on 22 January I did at last receive my long hoped-for release from my position of a nominal Minister without Portfolio. The reason given for it, however, was less pleasant. I believe the letter is already in the files of the Tribunal. It is a letter attached to the official document of release from Lammers.

DR. DIX: Yes, very well. We put a question on that subject during Lammers’ hearing.

SCHACHT: Yes. But I should only like to refer to the statement which says: “...in view of your entire conduct in the present fateful struggle of the German nation...”—so that was my whole attitude.

DR. DIX: Gentlemen of the Tribunal, it is Number 26 of the document book. It is on Page 76 of the English text and on Page 69 of the German text.

[_Turning to the defendant._] Please continue.

SCHACHT: It was, therefore, my entire attitude during this war which led to my dismissal, and the letter of dismissal also contained the statement that I would be dismissed for the time being. According to Lammers’ statement, as we have heard, this expression “for the time being” was included in the letter, also on the Führer’s initiative. I was very clearly aware of this wording when I received the letter.

Two days later I was removed from the Prussian State Council, of which I was a member—a body, incidentally, which had not met for at least 8 years. At any rate, I was not at the meetings. Perhaps it was 6 years, I do not know. The text of that decision was communicated to me by the chairman of that State Council, Hermann Göring, and because of its almost amusing contents, I still recollect it very clearly. It stated:

“My answer to your defeatist letter undermining the power of
resistance of the German people is that I remove you from the
Prussian State Council.”

I say it was amusing because a sealed letter written by me to Göring could not possibly shake the power of resistance of the German people. A further result was that Party Leader Bormann demanded from me the return of the Golden Party Badge and I did that at once. After that I was particularly closely watched by the Gestapo. I gave up my residence in Berlin immediately, within 24 hours, and for the whole day the Gestapo spies followed me all over Berlin both on foot and by car. Then I quietly retired to my estate in the country.

DR. DIX: Now, since the trial brief has mentioned material and pecuniary reasons for the decisions which you made, it appears to me justified and necessary to ask what was the position regarding your property and your income after 1933? In your reply please take into consideration that it is striking that in 1942 there was an increase in your income.

SCHACHT: A few months ago, apparently with the approval of the Military Government, there appeared in the press a list of donations which the Party leaders and ministers in Germany received and, in that connection, of their income and their property. I was also listed, not under “donations,” but it was stated that in 1942 I had an unusually high income. This list is incorrect, since it is a gross figure which is mentioned and it does not take into consideration the fact that the war profit tax was later deducted from it. When the list was compiled the tax was not yet determined, so that about 80 percent must be deducted from the sum which is given there. The income is then no longer striking in any way. In regard to my property, the list shows that over a period of 10 years it has hardly changed, and I want to emphasize here particularly that in the last 20 years my property remained approximately the same and did not increase.

DR. DIX: If I remember rightly you reduced your own salary as President of the Reichsbank at a certain time on your own initiative?

SCHACHT: When, on Hitler’s suggestion, President Hindenburg in March of 1933 appointed me again to the position of President of the Reichsbank, Hitler left it to me to fix my own income. At that time, I voluntarily reduced my income to less than 25 percent of my former income from the Reichsbank.

DR. DIX: Did you ever receive presents or donations from Hitler, either in money or in valuables?

SCHACHT: As I have just mentioned, 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 which 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.

THE PRESIDENT: It is not appropriate for the Tribunal to listen to this.

DR. DIX: Did Hitler ever bestow on you the right to wear a uniform or give you any kind of decoration or military rank?

SCHACHT: 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.

DR. DIX: Now, another subject: Did you know anything about the concentration camps?

SCHACHT: Already in the year 1933, when Göring established concentration camps, I heard several times that political opponents and other disliked or inconvenient persons were taken away to a concentration camp. That these people were deprived of their liberty perturbed me very much at the time, of course, and I continuously demanded, as far as I was in a position to do so during conversations, that the arrest and removal to concentration camps should be followed by a clarification before the law with a defense and so on, and suitable legal proceedings. At that early time the Reich Minister of the Interior Frick also protested energetically along the same lines. Subsequently this type of imprisonment, _et cetera_, became less known in public, and in consequence I assumed that things were slowly abating. Only much later—let us say the second half of 1934 and 1935...

DR. DIX: When you met Gisevius, you mean?

SCHACHT: Yes, when I met Gisevius—I heard on repeated occasions that not only were people still being deprived of their liberty, but that sometimes they were being ill-treated, that beatings, _et cetera_, took place. I have already said before this Tribunal that as a result, as early as May 1935, I personally took the opportunity of drawing Hitler’s attention to these conditions and that I told him at the time that such a system was causing the whole world to despise us and must cease. I have mentioned that I repeatedly took a stand against all these things publicly, whenever there was a possibility of doing so.