A In December of 1939. Then there was just a formal authority to issue directives. That is, as far as directives were concerned, I could sign for the five civilian economic departments, which, according to the Reichs Defense Law, were subordinate to this Plenipotentiary. I retained those authorities which pertained to the Reichsbank and to the Ministry of Economy, which I had anyway. the Plenipotentiary for the Four Year Plan; is that correct?
A Yes. Just like all civilian departments, as far as the Ministry of Economy was concerned, there was a closer relationship.
Q Mr. Witness, in August of 1939, that is, shortly before the Polish campaign, in your capacity as General Plenipotentiary for Economy, you gathered the civilian economic offices for a meeting, and Document 3324-PS refers to this meeting. It seems important to me that you define your attitude on this point also, and especially from this angle, that apparently on the basis of this discussion you wrote a letter to Hitler, dated the 25th of August, and that this letter was a result of this meeting.
In your trial brief on page 24 this matter is mentioned. Will you define your position on this point?
A Under Schacht's domain there was an office for the General Plenipotentiary for Economy, and there was a working commettee, which consisted of the representatives of the various economic departments, as well as representatives of the ministry of the Interior, the Plenipotentiary for Administration, the OKW, and above all, of the Four Year Plan. the Plenipotentiary for Economy was transferred to Dr. Vosse, who was his former State Secretary, whereas under Schacht, Staatstrat Wohltat had headed this office and this committee. These people of course had consultations constantly, in which consultations they discussed measures which would be necessary for a carrying on of the war in a civilian and economic sphere, and this was maintained. This matter was dealt with in my speech in Vienna. This was something which existed alongside the Four Year plan, and in the main was charged with transferring the civilian economy into a war economy in case of war without too many disturbances, and also to prepare for a war economy administration. the chiefs of the civilian economy departments, and called in the representative of the Four Year Plan as well. Then in joint consultations we dealt with those measures, and worked them out, which were necessary in case of a war to convert the civilian economy into a war economy, and do this with as little disturbance of economy as possible. dated the 25th of August 1939, and this was a period of time when the German and the Polish Army were already in a state of complete mobilization and faced each other as such.
in the civilian economy in case of a war, and it was further my duty as President of the Reichsbank, as far as gold and other financial assets of the Reichsbank were concerned, to strengthen them. tension which existed at the time, it would have been necessary also even if the war did not materialized, but if it was just a matter of economic sanctions even, sanctions which might have been expected and which one had to expect from the general political tension which existed at the time. As Minister of Economy, it was my duty to do everything to strengthen production.
cerned, I did not concern myself with this problem; and as far as armament problems were concerned, I had nothing to do with them at all, since, as I have already said, the leadership of the civilian as well as the war economy had been turned over to the Plenipotentiary for the 4-Year Plan.
May I tell you a little about the work of this committee? I maintained a reserve, and I can explain this reserve as follows: who at th at time discussed this problem with me must confirm me on this point. In those months shortly before the beginning of the war, I concentrated my entire activity on international negotiations to bring about a better international economic order, and to improve commercial relations between Germany and her foreign partners. ministers Hudson and Stanley. They were to visit me in Berlin. I myself was to go to Paris for negotiations; and in the year 1937 I had me some members of the cabinet when I was present and headed a great cultural affair in Paris at that time. new basis, and I had worked out new proposals to bring about this new order, proposals which were hailed with enthusiasm, especially in England. And in June of 1939, I had an international financial discussion whereby the leading representatives of the banking world, from the United States, from England, from Holland, France, Belgium, Switzerland, and Sweden-representatives of all these countries were there with me. us, and at the same time was instrumental in the exchange of assets of the Reichsbank abroad. This exchange of those assets was hailed in foreign banking circles. It was considered fair and satisfactory. agreements, and I also participated in financial meetings and discussions at Basel; and at the beginning of July of 1939, despite the strong political tension which existed at the time, I was of the opinion and the conviction that it would be possible to prevent a war.
In all of my discussions, at home and abroad, I voiced this conviction of mine. And this is why I was not interested in the discussions, consultations, and (conversion) meetings about the beginning of the war and the change of the national economy for war.
possible, to use its assets abroad to get gold instead of increasing our foreign assets. But in these few months of my official activity before the war, the success of this endeavor of mine was very slight. Our gold assets and foreign assets as they were turned over to me from Schacht were, up until the war, unchanged on the whole. quested clarification on these transactions, since the directorate of the Reichsbank and the managing director at the time I had to have information on this matter and the answers to this question, I am sorry to say, had not arrived as yet.
Q Mr. Witness, these expositions were made by you obviously to show that despite the political tension in the situation at the time you did not even think of a war? a series of discussions which were carried on by Hitler with generals and other personalities. And these discussions were of a military and political content. These were all discussions of which we must say today that they were in the closest connection with preparations for war. learn at these discussions, and from them? was never called in, and I did not participate in a single one of these discussions which were mentioned in this connection as far as aggressive war was concerned. I am referring to discussions with the Fuehrer in this connection. I was never informed even as to the contents of these discussions.
But as far as I can remember, I was hardly ever present at the discussions at the Reichsmarshal's when they dealt with this topic. of 1938.
Q The 14th of October, 1938? I can tell you the document number. It is 1301 P. S. That was the 14th of October 1938, document 1301 P. S. Please continue. Were you present at that meeting?
A No. Yes, that was the meeting in which, according to the accusation held against me, Goering pointed out that he had been instructed by the Fuehrer to strengthen armament abnormally. The Luftwaffe was to be increased five times, as speedily as possible. erted that in this discussion between Goering and me, Goering addressed me in the words of a man who was already at war. In those days, I was not even in Germany. I was in Bulgaria at the time, and consequently could not participate at those sessions.
DR. SAUTER: Mr. President, for the proving of this fact that the defendant Funk at the time of this discussion with Goering on the 14th of October, 1938, was not in Germany, in the document book "Funk" I have submitted several documents, extracts from "Der Voelkische Beobachter, the numbers 5, 6, 7, and 8. These documents are submitted chiefly because they show that at the time beginning with the 13th of October, 1938, until the 15th of October, 1938, Funk, as a matter of fact, was at Sophia, at Bulgaris, and therefore could not have been present at the Goering meeting of the 14th of October, 1938. economic conditions it is hardly necessary for me to read. But I would like to refer especially to his speech of the 15th of October, 1938, found in the Document Book, "Funk", Number 7, in which the defendant Funk, especially in the first paragraph, showed in a schematic manner that the thought of an economic community between the German economy and the Southeast European economy was in his mind, and in which Funk with great deliberateness treats the unilateral dependency of the Southeastern States with respect to Germany, and rejected this unilateral situation.
der to save time I will not go into them in detail.
Q Witness, under No. PS-3562 the Prosecution has submitter a document deal ing with a discussion of the 1st of June 1939.
At this discussion and at this meeting you yourself were nor present but according to the list of these present several representatives of your Ministry were there, as well as a representative of the Reichsbank. At this meeting the financial situation in case of a war was dealt with, as well as the productivity and capacity of German economy and the protectorate also in case of a war. There is a marginal note in this record which says that the record was to be submitted to you, and I am asking you to define your position briefly and to tell us whether this actually did take place. "W.F." to it, and this matter deals with circumstances and continous discussions which I have already dealt with, about the financing of the war, and applies to measures in the civilian economy, field in case of a war. The decisive measures as far as financing were concerned were dealt with and prepared by the Reich Minister of Finance, and these financial measures were discussed at length in this meeting and the question of meeting the expenses through taxes. That was one of the chief problem discussed. In any event, these discussions did take place at that time among the representatives of the various department offices. leadership staff of the Plenipotentiary for Economy concerned himself with this, I just now found the name of this head, this man whose name I could not remember.
There were the instructions, and this committee which even in the days of Schacht's functioning and which later continued.
Q Dr. Funk, on the 30th of March 1939, you made a speech for the Central Committee on the Reichsbank. The excerpts of this speech, which are necessary for the carrying on of this proceeding, I have included these extracts in the Funk document book, under No. 9, and I am referring and coming back to it for the reason that shortly after your assuming office as President of the Reichsbank this speech was delivered and in some connections of importance in this proceeding are considered to be his program as President of the Reichsbank.
Dr. Funk, perhaps with just a few brief words you night give us the high spots of your speech as far as it is relevant for the Prosecution.
A I do not believe that I need to do that. Just a minute ago I briefly mentioned the fact that in those months I carried on international negotiations about a now order for German trade and economic relations, and I mentioned the readiness on Germany's part to participate dicisively, and I do not believe that I need to read anything more from this speech. This speech is to show only that at that time I did not work for preparations for war but with the objective of bringing about an international economic understanding, and that this, my work, was recognized in foreign countries, especially in England, and it was recognized publicly. abroad, especially as far as financial and economic matters were concerned, was, I am sure, decisive for a measure which you already referred to a little while ago, and I mean that the compensations were these who were interested in the Reich sbank. I believe there were some people like that in England and Holland and in Switzerland. This letter would be interesting to us in this respects: In that I would like to know just why you wrote this letter and why in this letter you mentioned "my proposals" even though in the main it was not concerned with things which did not actually trace back to you. Perhaps you can give us a brief explanation. feeling which existed in Germany at that time, and beyond that it is a purely personal letter to the Fuehrer. In this letter I thanked him for his congratulations on my birthday. And that is the reason why the letter is a little on the emphatic side, and if I mentioned "my proposals" this may be traced back to the fact that I personally at some time before had told the Fuehrer which measures would be necessary if a war were to arise. And in the main, those were the measures which later formed the basis of a discussion with the other offices and to which I referred in this letter. It was not quite correct for me to say "My prop sals". I should really have said, "The proposals worked out by me, together with the chiefs of the Economic Office."
Q Dr. Funk, have you concluded?
A No. I would like to explain this whole letter with just a few words, of since it seems to be one of the pillars of the Prosicution's case against me. other. It was the time when the entire German people were in a state of great exe tement because of the constant provocations in Poland, and the mistreatment of the German population in Poland. I personally did not believe that we would actually have war, for I was of the opinion that diplomatic negotiations would be successful in this case in preventing the threat of war as well as war itself, an the Fuehrer had successes in this direction which bordered on the unbelievable, and as a result of this the heart of every German was to beat faster in the knowledge and in the expectation that now there would be a fulfillment of German wishe in the East, that home province of East Prussia which had been separated would be again reunited with the Reich, that the old German city of Danzig would be reunited with the Reich, and that the Corridor problem would be solved.
that this question would call forth a war. We were on the other hand of the conviction that England would be successful to exert pressure on Poland so that Poland would acquiesce in the German demands as far as the corridor is concerned and that no war would break loose. According to the testimony of the witness Gisevius, of course, everyone in the entire world saw clearly that England at that time did nothing to work on Poland in a soothing and conciliatory manner; and if people thought that Germany was trying to bring about a conspiracy in which the Chief of the General Staff and the Chief of the OKH and the Chief of the German Armament and other leading military personalities were involved, that in the event of a war there would be an overthrow which had been prepared, then the British Government would have been foolish indeed if it had done anything to sooth and quiet Poland; and the British Government would of necessity have to be of the conviction at this point that Hitler would go to war, at which an overthrow would come, and that there would be no war and that the hated Hitler regime would be put aside, and more could not be expected.
Q Dr. Funk, we are not interested in the making of political speeches, but let us stick to this letter of the 25th of August, 1938. I would like to say again, 699PS. Let us return to this matter in which I am interested at present, and if I understood you correctly, I can summarise your testimony so far that this rather enthusiastic letter to Hitler was written for the reason that you were hopeful that Hitler would succeed to reunite your East Prussian home province with the Reich, and would now finally settle the corridor problem without a war. Did I understand you correctly? him that as far as I was concerned, everything had been done. In the event of a war the peace economy would be converted into a war economy without disturbance. And this was the only time atwhich I was active plenipotentiary for Economics, and I referred to my position in this letter. And it may be explained on a human basis, for I was proud of the fact that I had for once done something in this official position, for a man likes to be successful.
Q Dr. Funk, at this point we are concerned with the question of whether you knew of Hitler's intent to bring about a war, especially to wage aggressive war, and to bring conquest through aggressive wars; whether you had knowledge of his intent along these lines. I would like to put a few questions to you which for the sake of simplicity I would like to have you answer yes or no; for I would like to know only whether your knowledge and your memory agree with the statements made by some witness and some defendants. were especially hard pressed if you wanted to see Hitler; that you had great difficulty in seeing him; that you saw him just once in a great while; and that even on one occasion I believe it was for days you were with Lammers at headquarters and always waited for the visit which had been promised you but that you could not actually get to see Hitler, and that you had to leave for home without having accomplished your mission. Is that correct?
Q Now a further question: We have been confronted with several documents which say explicitly -- I believe it is the record of Lammers -- that the Reichsminister of Economics and I believe one time the Foreign Minister, had requested to be called in to certain meetings; that Minister Lammers tried to do his best to bring this about, and that Hitler rejected this; that he explicitly prohibited you and the Reich Foreign Minister to have access to their meetings, even though you pointed out that important matters of your department were to be dealt with. Is that correct? Perhaps you can answer with just yes or no. of labor and I myself had no connection with that, and the Foreign Minister did not seem to have any strong interest along these lines cither. So I assume that for those reasons the Fuehrer called neither the Foreign Minister nor me into this meeting, and the Fuehrer did not need me for, as I said yesterday already, as far as directives for the carrying on of the economy were given by him up to the year 1942, they were given to the Reichsmarshal and the Reichsmarshal was responsible for carrying on the economy. After 1942 the directives were given to Speer, for from that date on armament dominated the entire economic life, and all economic positions were traced back to the Fuehrer and everything had to be dovetailed to armament.
Q Dr. Lammers in his testimony on the 8th of April stated, I quote:
"The Fuehrer many times objected, that is, against Funk. There were several reasons and different reasons which worked against Funk. He said that Hitler was aseptically inclined towards Funk and did not want him," From the testimony of the Witness Dr. Lammers. This disinclination of Hitler's to you, can you explain that? need me. superfluous.
Q Mr. Witness, in connection with the chapter "Aggressive War," I would be interested in noting the following: In the Indictment against you on page 30, 34 -- that is, 34 of the German trial brief, it is set forth that you personally and through your official representatives, participated in the preparation which led to the aggressive war against Russia. And as the sole proof for this statement a document is given, 1039 P.S., U.S. 146. I repeat, 1039 P.S., U.S.146. From this document it allegedly is to be seen that you, defendant, at the end of April, 1941, together with Rosenberg -- Rosenberg who is responsible for the Western territories -- had a discussion about the economic questions which would result if the aggressive plans in the East would be carried through. I am therefore asking you, Dr. Funk, to note the date of this discussion, that is, the end of April, 1941, just short time before the beginning of the war against Russia;and in order to refresh your memory I would like to point out that at that time, that is, before the war against Russia actually broke out, Rosenberg had already been nominated as Hitler's plenipotentiary for the eastern torritories. And I am asking you now to define your position to this discussion and especially dealing with whether it can be seen from this that you participated in an aggressive war toward Russia or the preparation for it. And if you did participate, how.
A I know nothing about the aggressive war against Russia. I was very much surprised when from Lammer's words I had the advice that the Fuehrer had made Rosenberg plenipotentiary for Eastern European problems.
Lammers stated here that he had me advised of this matter for personal reasons for he know that I was very much interested in all economic relations with Russia. For the mutual efforts, that is, on the side of Russia as well as on the side of Germany, it had been made successful to reconstruct this trade and make it strong again, especially since in prior years, that is, before the first World War, the German trade with Russia had been the decisive factor in German trade and the money amounted to several billion of German gold marks. The Russians delivered us ore, oil, grain, and made these deliveries very promptly, and our deliveries of machines lagged behind a little for, first of all, the machines had to be produced. In fact, mostly these were special orders, they were highly specialized machines. And as far as army supplies were sent to Russia, I did not know, for I was not concerned with those problems. Therefore I was surprised through the announcement that Rosenberg had been appointed. Rosenberg called on me and told me briefly that this instruction from the Fuehrer was to bring with it the treatment of economic problems and plans. Thereupon I told one of the men in my ministry, Dr. Schlotterer, to work for Rosenberg in the problem when the Eastern Ministry was founded; and as far as I know, this had been in July. Dr. Schlotterer, a man whom I had given to Rosenberg -- Dr. Schlotterer with some colleagues took ever the leadership of the economic aspect in the ministry of Rosenberg are simultaneously, as far as I remember, Schlotterer entered the Wirtschafts Fuehrung Stab Ost, (Economic Operational Staff, East), and this was the organization of the Four-Year plan, this organization which has been mentioned repeatedly. It dealt with all economic problems in the occupied Eastern Territories. I asked Lammers as well as Rosenberg just what this would mean and both of them told me that the Fuehrer was of the opinion the a war with Russia was inevitable, that along the entire Eastern Front the Russians had had many re-enforcements that there had been discussions with Molotov, and at which I was not present; that these discussions had been unsatisfactory; that the Russians had been making demands regarding the Balkan regions, regarding the Baltic and the Dardanelles, which could not be acquiesced in by Germany or by the Fuehrer.
And in fact, even this matter was a complete surprise to me, as to the German people, and I am of the conviction that this war was upsetting to the German people.
Q When you spoke of July, you meant July, 1940?
THE PRESIDENT: You said July, I want to know if you meant July 1940.
DR. SAUTER: My interpretation is not coming through, Your Honor.
THE PRESIDENT: The witness spoke of July. Did he mean July 1940?
DR. SAUTER: As far as I know, July 1941.
THE PRESIDENT: You mean July 1941? That was after the war with Russia had begun. The witness can answer for himself, I suppose, can he not?
Did you mean July 1940?
A. The discussion with Rosenberg was at the end of April or the beginning of May 1941, and the foundling of the Ministry Rosenborg was in July 1941.
Q. Witness, now we shall turn to a different point made by the Prosecution You are accused of having committed as Reichs Minister of Economy deeds which are punishable, dealing with the persecution of the Jews and the elimination of Jews from the economic life. These are the happenings of November 1938. Now I should like to ask you to picture your activity along these lines.
A. I am asking the High Tribunal, as far as this point is concerned, to give me some time for a rather detailed pucture. Then the points which we will treat with subsequently can be dealt with much more briefly. This is the point raised by the Prosecution which really hits me the hardest. received from the Party, and especially from Goebbels and Ley, I received the demand to eliminate the Jews from the economic life, since it was unbearable -and the assertion was made that way to me -- that people should still have to buy in Jewish stores. The Party could not permit members of the Party to buy in stores like that and the Party was also offended by the fact that high Party dignitaries and their wives were still shopping in Jewish stores. This had created quite a furor in the Party, and in the Labor Front people refused to deal with the managers of Jewish businesses, and there were constant conflicts, and it was also said that there would be no peace and quiet if those measures which had been started on in a small way here and now were not carried out to such an extent that gradually the Jews would be eliminated completely from the economic life.
under my predecessors and which, in agreement with the Labor Front, had been carried through by my predecessors, the economic life had political and Party functions. The manager or leader of a business was at the same time a representative of the Party and had applications to the State. their enterprises to people at prices which we did not like. I had friends am* the Jewish Leaders of big industry and banking, and I had made private agreement and had brought about their eliminataion from economic life, but there was no peace to be had, and we had to try at a certain time and in line with legal prescriptions to crowd the Jewish influences out of economic life and to removal them from the economic life completely. ings should be carried on slowly, that it was to be carried on in certain period of time; secondly, that the Jews were to have an adequate compensation; thirdly that one might leave certain economic interests in their hands, especially insofar as shares were concerned. I participated in this meeting with Goering the meeting which has been mentioned here so frequently. and 10, 1938, burst upon us. The center of these activities was at Munich, an they really hit me personally very hard. When on the morning of 10 November I came to my Ministry, I saw on the streets and in the windows of the stores the devastation which had taken place and heard further details from my officials in the Ministry. I tried to reach Goering and Goebbels and Himmler, but they were all en route from Munich. Finally I succeeded in reaching Goebbels. this valuable economic goods which could not be replaced had been destroyed and that our relations abroad, upon which we placed special stress at this time and upon which we were particularly.
dependent at this time, would be disturned markedly. affairs, that I should have eliminated the Jews from the economic life long since, and that the Fuehrer, through Reichsmarshal Goering, would issue an order according to which the Jews would be completely eliminated from the economic life and that I would receive further details from the Reichsmarshal. This telephone conversation with Goebbels was confirmed by him later, and witnesses can testify to this point. meeting on the twelfth with Goering, who was the Plenipotentiary for the Four Year Plan, in which the Jewish problem was to be regulated, and the Four Year Plan had given instructions to the Ministry to prepare a decree which was to be the basis for laws dealing with the elimination of Jews from the economic life. actually took place. There was a discussion in the morning with the Reichsmarshal, at which the gauleiters were present. The Reichsmarshal was very, very much excited, and he said that he would not tolerate this terror and that he was holding the various gauleiters responsible for that which had happened in their gaus. which has been read into the record several times Goebbels very soon produced his very radical demands, and he more or less tore the leadership into his own hands. state of peevishness made those statements which are mentioned in the record.
On the whole, the record is full of holes. It is very incomplete. After this meeting, it was clear to me that now, as a matter of fact, the Jews would have to be eliminated from the economic life, and in order to protect the Jews from further terror and the loss of all their rights and to protect them against exploitation and plundering, legal measures would have to put on the statute books.
and the Minister of Justice, gave out measures for the carrying out of these measures. After the transition of the Jewish businesses and Jewish shares were given over to trustees, the Jews was compensated along measures of three per cent, and I saw to it that as far as the Ministry of Economy was drawn into this, these compensations were carried out according to law and that no new injustice was done the Jews. thought of that in any way. Of course, in the meeting, a plan was mentioned briefly that an emigration of the Jews was to be organized, but in the measures of terror and of violence against Jews I personally did not participate. I regretted these measures to the utmost, and I rejected them as sharply and as critically as possible, but the measures for the carrying through of these laws I had to give out in order to protect the Jews against their losing all rights, and the legal determinations which were issued had to be carried through in an orderly manner.
THE PRESIDENT: We will adjourn now.
(A recess was taken.)
activity concerning the decrees for the exclusion of Jews from economic life and at the end you told us about the minutes of a session with Goering, of the 12th of November 1938. That is PS-1816. not set up correctly, and that there are omissions in it, but we can see from these minutes that apparently you were instrumental in applying brakes on the measures and you tried to save, for the Jews, one thing or another. So, we can see, for instance, from the minutes, that during the conference, you repeatedly intervened and maintained that the Jewish stores should be reopened. Is that correct? also so that the Jews should be able to keep their shares and interests. That can be seen from a question that you put. been of the opinion that the Jews should keep their shares and during that conference I expressed that. It was quite new to me that the Jews should also turn over their possessions of shares and they got Government bonds and were supposed to turn over all their shares and interests. Government would take over the shares and the utilization of such shares, of course, was very difficult. in favor of bringing the Jews into Ghettoes and you recall that the Prosecution has once mentioned that fact here.
What was your attitude at that time, Dr. Funk, concerning that subject matter by Heydrich? Ghettoes a terrible thing. I had not known any Ghettoes, and I said to myself, "Three million Jews among seventy million Germans -- well, we can let them live without Ghettoes."