A "Decrease"?
Q "Decrease", yes, "temporary".
Q I emphasize "temporary" and you emphasize "decrease".
A Oh no, no; I agree with you.
Q "And that further, with reference to the Four Year Plan, we should solve only those problems which appear most pressing. Among these I include the gasoline program, the buna program, and the program of developing internal resources insofar as this development does not of itself require large amounts of raw material which must be withheld from export.
"On the other hand, all other measures of the Four Year Plan should be postponed for the time being. I am covinced that by such a policy our export could be increased so greatly that our exhausted stockpiles would experience a certain improvement and that the resumption of a strengthened armament would again be possible in the not too distant future from the point of view of the raw material situation.
To what extent a temporary postponement of armament would have military advantages, I am unable to say. Yet, I would suppose that such a pause in armament would not only have advantages for the training of officers and men, which has yet to be done, but that this pause would afford an opportunity to survey the tehcnical results of previous armament and to perfect the technical aspect of armament."
Now that you addressed to Goering, did you not?
A. That is perfectly possible. I can't remember the letter, but it looks just like one of mine.
Q. Yes, and you were correctly giving to Goering your true views, were you not?
A. No; I believe that this was a very tactical letter. I think that I was trying to limit rearmament. If I had told him that we wanted to stop rearmament, then Goering would probably have denounced me before the Fuehrer accordingly. Therefore I told him, "Let's stop a bit, temporarily." I emphasized, too, the temporary thing. It was a tactical measure to convince Goering that for the time being it should be temporary.
Q. Then, with your fellow officers in the Government you were also using tactical statements which did not represent your true views?
A. That was necessary to the utmost degree.
Q. When did it cease to be necessary, Dr. Schacht?
A. Cease?
Q. Yes; when did it cease to be necessary?
A. I think it more important that you should ask when it commenced; when it started.
Q. Well?
A. During the first years I didn't do that sort of thing, but later on, to a considerable extent, I think you can say permamently; it never stopped.
Q. Has it stopped now?
A. I have no more colleagues, and here before this Tribunal I have to do nothing but tell the truth.
Q. Well, on the 24th of December, 1935, you wrote EC-293, which is United States Exhibit 834, and used this language, did you not?
"If a degree of armament going beyond these is now demanded, it is, of course, quite far from me to deny or change my advocacy of the greatest possible armament, expressed for years, both before and since the seizure of power; but it is my duty to point out the economic limitations of this policy."
A. That is pretty good.
Q. And that is true?
A. Yes.
Q. Now, there came the Four Year Plan in 1936?
A. Yes
Q. You did not like the appointment of Goering to that position?
A. I thought he was unsuited. Apart from that, of course, it gave an opening for a policy which was opposed to mine. I knew perfectly well that now the exaggerated rearmament was starting, whereas I was for restricted rearmament.
Q. Why do you say that Goering's appointment meant exaggeration of armament? Can you point to anything that Goering has said in favor of rearmament that is any more extreme than the things you have said?
A. Oh yes.
Q. Will you do so?
A. Yes, I think if you read the record submitted on the so-called "Small Ministerial Council", which you yourself have introduced, of the year 1936, and in particular 1938, you will then see at once that here the necessity of increased armament was emphasized. Take, for instance, October-November 1936,
Q. Well, it was also emphasized in your documents, was it not, throughout?
A. No.
Q. You say that your statements of that sort were merely tactical.
A. No, I beg your pardon. I said "rearm within the limits of the economic possibilities, and reasonably." Goering, if I may say it again, wanted to go beyond those limits.
Q. That is exactly the point I want to make. Your difference with Goering over rearmament was entirely a question of what the economy of Germany would stand, was it not?
A. No. I said: "The most important thing is that Germany live and that it have foreign trade, and within the limits of that we can rearm. But that Germany should rearm more, merely to rearm, and ruin here economy, that is out of the question."
Q. Well then, the difference between you and Goering was over what the economy would stand, was it not?
A. No, but what the degree of rearmament should be, because this is the point, Mr. Justice Jackson. The things that Goering had done were also borne by German economy. The only question is, was it reasonable or unreasonable? ing's economic policy as unreasonable and a burden to the German nation, whereas my first and the most important argument was that rearmament should not go any further, but that the German nation should have a normal, peace-time standa.
THE PRESIDENT: The Tribunal will adjourn.
(A recess was taken until Friday, 3 May 1946, at 1000 hours.)
THE PRESIDENT: The Tribunal will sit in open session tomorrow at ten o'clock and will adjourn into closed session at twelve noon.
Mr. Justice Jackson and defendant Schacht: it is desired, on behalf of the interpreters, that you should pause, if possible, after the question has been put to you, and if you find it necessary, owing to the condition of the documents with which you are dealing, to read in English or speak in English, to give an adequate pause so that those interpreters who are interpreting from English into other languages can take over the interpretation. Is that clear?
MR. JUSTICE JACKSON: I owe an apology constantly to the interpreters. It is hard to overcome the habit of a lifetime.
THE PRESIDENT: It is very difficult. BY MR. JUSTICE JACKSON:
Q Dr. Schacht, -- by the way, the photograph number ten which was shown you yesterday, that was one of the occasions on which you were the Party badge which you referred to, was it not?
Q You are quite sure of that, are you not? prove that the picture was taken after 1937, after January 1937.
Q That is what I wanted to prove. And as a matter of fact, it was taken after 1941, wasn't it?
A I beg your pardon?
Q As a matter of fact, Bormann didn't come to any important official position until after 1941, did he?
A Bormann? -- that I don't know.
as I understand it you opposed the appointment of Goering to have charge of the Four-Year Plan on two grounds: First, you thought that that new plan might interfere with your functions and secondly, if there were to be a Four-Year plan you did not think Goering was fit to administer it?
A I do not know what you mean by "opposed to". I was not satisfied with it, and I considered the person of Goering not the right one to have a leading position in economics. have you not?
Q Or an interrogation? did he not?
Q And he got away with it too, didn't he?
A I don't understand what you mean by that, "he got away".
Q Of course, American slang is difficult, I admit. It means he succeeded. with reference to mining?
Q He also made a speech to some industrialists, didn't he?
A I assume that he made several speeches to industrialists. I do not know which one you refer to. I assume you mean a speech in December 1936. that Goering had assembled industrialists and said a let of foolish things about the economy, which you had to refute.
Q And then you wrote to Goering complaining about the mining measures?
A I assume that you mean the letter of the 5th of August?
Q Right. That document is EC-497 USA-775. And in that letter of August 1937 you said this, if I quote you correctly:
"In the meantime I have repeatedly stressed the need of increased exports and have worked to bring it about. The very necessity of bringing our armament up to a certain level as rapidly as possible must place in the foreground the idea of as large returns as possible in foreign exchange and therewith the greatest possible assurance of raw material supplies." Correct?
Q And you also said this, I believe:
"This view of the economic situation which I have explained above I have held from the first moment of my collaboration."
That was also true, was it not?
Q Now, both of those things were true, were they not?
"I asked you to believe me, my dear Prime Minister, that it is not my intention at all to wish to impede your policies in any way whatsoever. I offer no opinion, either, whether my views, which deviate from your economic policy, are correct or not. I have full sympathy for your activities. I do believe, however, that in a totalitarian state it is wholly impossible to conduct an economic policy divided against itself."
And that was also true, was it not? far as policy was concerned?
A So far was what was concerned?--policy?--what do you mean, the manner in which business was conducted aside from other differences which we had?
Q Yes. Now, these other differences were personal differences. You and Goering didn't get along well together?
A Just on the contrary. Until then we were very friendly to each other.
Q Oh, were you? the struggle as to which of you would dominate the preparations for war?
A I have to protest against that. The differences-
Q Do you want to say anything more about it? fact that Goering wanted me to assume command over economic policies and I should have the responsibility therefore, and I was of the opinion that he who assumes responsibility should also have command; and if one has command then he also has to assume the responsibility. That is the formal reason why I asked for my dismissal.
United States Exhibit 636, and ask if you did not give the following testimony:
"By Schacht:
"After Goering had taken over the Four Year Plan, and I must say after he had taken over the control of foreign exchange since April, 1936, but still more after the Four Year Plan, September 1936, he has always tried to get control of the whole economic policy. One of the objects, of course, was that as Plenipotentiary for War Economy in case of war, and he being only too anxious to get everything into his hands, he tried to get that away from me. Certainly as long as I had the position of Minister of Economics I have certainly objected to that."
You made that statement? months, had endeavored to unite Goering and yourself.
A That is a mistake; that is Hitler, and not Luther.
You described it as follows:
"Then I had a last talk with Goering, and at the end of that talk Goering said, 'But I must have the right to give orders to you. ' Then I said, 'Not to me, but to my successor.' I have never taken orders from Goering, and I would never had done it because he was a fool in economics and I knew something about it, at least.
"Question: Well, I gather that was aculminating, progressive, personal business between you and Goering. That seems perfectly obvious.
"Answer: Certainly."
Is that correct?
Q And then the interrogator went on:
"Let's go into the duties of that job for a moment and see what he was trying to take away from you. There are only two possibilities, as it has been explained to me; if I am wrong, correct me. One would be the preparation for a mobilization, and the other would be the actual taking charge of this in the event of war. Otherwise, the post had no meaning. So the things you resisted his taking away from you, as I see it, was the right to be in charge of the preparation for mobilization, and secondly, the right to control in the event of war.
"Answer: Correct."
Did you give that testimony?
A Please, Mr. Justice, you are mixing together various things so far as time is concerned. The differences with Goering about this so-called Plenipotentiary for War Economy occurred in the winter 1936-1937 3 and the so-called last conversation with Goering which you have just mentioned took place in November 1937. I stated, I believe in January 1937, that I was quite prepared to turn over the office and the activity as Plenipotentiary for War Economy to Goering. That can be found in the notes of the Jodl Diary, which have been frequently mentioned here. me in the position as Plenipotentiary for War Economy, since I was the Minister of Economy, and as long as I was the Minister of Economy. You can find the correspondence about that, which I think has already been submitted by you to the Tribunal.
Q Well, all right; I think the dates appear in your testimony. I am not concerned at the moment with the sequence of events, I am concerned with the functions that you were quarreling over, and which you described in your interrogations. And the questions and answers which I read to you are correct; those are the answers you made, are they not?
A Yes, but I have to say the following. If you ask me about these different phases, it will give an entirely different picture if you don't separate the different periods. You cannot take evants of January and of November and put them together and then ask me if that is correct. That is not correct.
Q Well, let's get what is wrong about this, if anything. would give orders to your successor but not to you? relation to time, has it? That is, the Plenipotentiary for War, the disagreement between you and Goering.
In order to make it perfectly clear, I will read this question and answer to you again, and I am not concerned with time, I am concerned with your description of the job.
"Question: Let's go into the duties of that job for a moment and see what he was trying to take away from you. Now, there are only two possibilities, as it has been explained to me. If I am wrong, correct me. One would be the preparation for a mobilization, and the other would be the actual taking charge of this in the event of war. Otherwise, the post had no meaning. So the things you resisted his taking away from you, as I see it, was the right to be in charge of the preparation for mobilization, and secondly, the right to control in the event of war."
And you answered, "correct", did you not? to that question that it was correct?
A Yes. Now I wish to say that that difference between Goering and myself had absolutely nothing to do with the conversation of November, and that it was not exactly a difference of opinion between Goering and myself. of 1937, and it was not really a difference of opinion between Goering and myself, because I said right away, "You take over that office as Plenipotentiary for War Economy from me and turn it over to Goering." The War Ministry, von Blomberg, protested against this, not I, I was happy to turn over that office to Goering.
Q Is there anything in writing about that, Dr. Sschacht?
A Your documents which you have submitted here. I would like to ask my counsel to look for these documents and to present them during the re-examination. They have been submitted by the prosecution.
Q Now, isn't it a fact that your controversy with Goering was a controversy of a personal character between you and him for control, and not a controversy as to the question of armament? You both wanted to rearm as rapidly as possible. else, that I should not like to continue. I had had differences of opinion with Goering of factual nature. Now if you say whether it was armament, speed, or expense, I had great difficulties with Goering as far as opinions were concerned. I have never disputed that I wanted to rearm in order to gain equality for Germany, never. I wanted to rearm, Goering intended to go further, and here is one difference which cannot be overlooked.
Q Now I don't want to play upon words, and if you say my reference to it as a personal is a play upon words, you force me to go into what you told us about Goering.
Is it not a fact that you told Major Tilley this?
"Hitler I called an amoral type, but Goering I can only regard as immoral and criminal. By nature endowed with a certain bonhomie which he managed to exploit for his popularity, he was the most egocentric being imaginable. The assumption of political power was for him only a means for personal enrichment and personal good living. The success of others filled him with envy. His greed knew no bounds. His predilection for jewels, gold and finery was unimaginable. He knew no comradeship. Only so long as someone was useful to him was he friends with him, but only on the surface.
"Goering's knowledge in all fields equalled zero, especially in the economic field. Of all the economic matters which Hitler entrusted to him in the autumn of 1936 he had not the faintest notion, though he created an immense official apparatus and misused his powers as lord of all economy most outrageously. In his personal appearance he was so theatrical that you could only compare him with Nero. A lady who had tea with his second wife reported that he appeared at this tea in a sort of Roman toga and sandal studded with jewels, his fingers bedecked with innumerable jeweled rings and generally covered with ornaments, his face painted and his lips rouged."
Did you give that statement to Major Tilley?
Q And you say you had no personal differences with Goering?
A Mr. Justice, You ought not to confuse the different periods of time. I found out about these things later and not at the time of which you speak. That is the year 1936. Goering's complicity in the whole Gestapo set-up? had installed. I said that I tried to intervene against it. I do not dispute that. pecially as long as I do not know exactly what kind of a man he is.
Q All right. Let's take up foreign relations, about which you have made a good deal of complaint here. I think you have testified that in 1937 when you wer doing all of this rearming you did not envisage any kind of a war, is that right?
A That is not correct, what you just said, Mr. Justice. In 1937 I did not do everything to rearm, but from, the fall of 1935, on, I did everything to put the brakes on armament. whether you gave these answers to these questions:
Q "Let me ask you, then, in 1937, what kind of war did you envisage?
A "Never. We might have been attacked, invaded by somebody, but even that I had not expected.
Q "You had not expected. Did you expect a possibility of a mobilization and concentration of economic forces in the event of war?
A "In the event of an attack against Germany, certainly.
Q "Now, putting your mind back to 1937, are you able to say what sort of an attack you were concerned with?
A "I don't know sir.
Q "Did you have thoughts on that at the time?
A "No, never.
Q "Did you then consider that the contingency of war in 1937 was so remote as to be negligible?
A "Yes.
Q "You did?
A "Yes, I have never thought of a conflict with Russia.
Did you give those answers? before this Tribunal.
Q Now, you testified that you tried to divert Hitler's plan which was to move and expand to the East -- you tried to divert his attention to colonies instead.
Q What colonies? You have never specified.
Q And where were they located?
A Oh, what I told Hitler? I told Hitler we should try to get back a part of the colonies which belonged to us and the administration of which was taken away from us, so that we could work there.
Q What colonies? the future of Germany?
A Not those, but generally, colonial activity; and of course, first I limited my requests for colonies; I could only limit my request for colonies to our prop
A Not I personally called then that. That is what the Treaty of Versailles calls them. for the sort of Germany you had in mind creating.
A If you would like to replace the word "exploitation" by "development" I believe there will be no misunderstanding, and so far I agree with you.
Q Well, by "development" you mean trading, and I suppose you expected to make a profit out of trade.
the natural existing economic possibilities of the colonies, to have those developed. colonies instead of relying on expansion to the East. complete nonsense. was a necessary condition of the kind of Germany you wanted to create. thing toward the East; only colonial development was the solution.
Q And you proposed as a matter of policy that Germany's development should depend on colonies, as to which there was no overland trade route with Germany and which you knew would require naval power to protect?
A I don't think that -- how do you get that idea?
Q You don't get to Africa overland; you have to go by water at some point.
Q You were thinking only of air developments?
A No, no. I think of ships also.
Q Yes. And Germany was not then a naval power. power to protect the trade routes to the colonies you were proposing?
Q Then your plan was to leave the trade route unprotected?
A Oh, no. I believed that international law would be sufficient protection.
developments.
A Oh, no. I have explained here that he gave me the order in summer, 1936, upon my request to take up these colonial matters. Schacht?
"Question: In other words, at the time of your talks with Hitler, in 1931 and 1932, concerning colonial policy, you did not find him, shall we say, enthusiastic, about the possibility?
"Answer: Not enthusiastic, and not very much interested.
"Question: But he expressed to you what his views were alternatively to the possibility of obtaining colonies?
"Answer: No, we didn't go into other alternatives."
Did you give those answers? was not intent upon preserving the peace of Europe by all possible means. was an important factor in his Eastern policy.
A Well, one may express it that way. I don't know exactly what you mean by it.
Q Well, don't answer anything if you don't know what I mean, because we will make it clear as we go along. Except for the suggestion of colonies you proposed no other alternative to his plan of expansion to the East. alternative. answers:
"Question: Actually Hitler did not use the precise method that you say you favored?
"Answer: Not at all "Question:
Did you favor the method that he did employ?
"Answer: Not at all, sir.
"Question: What was there in his method that you didn't like?
"Answer: Oh, it was simply overrunning, just taking, the Austrians over the head -- or what do you call it? It was force, and I have never been in favor of such force."
Did you give those answers?
Q. Now, you have made considerable complaint here that foreigners didn't come to your support at various times in your efforts to block Hitler, have you not?
A. Certainly.
Q. You knew at the time of the Austrian Anschluss the attitude of the United States towards the Nazi regime, didn't you, as expressed by President Roosevelt?
A. Yes.
Q. And you knew of his speech suggesting that the Nazi menace ought to be quarantined to prevent its spread?
A. I don't remember, but I most certainly must have read it at that time. If that speech was published in Germany, then I must have read it.
Q. Goebbels let loose a campaign of attack on the President as a result of it, didn't he?
A. I assume that I read it.
Q. As a matter of fact, you jointed in the attack on foreigners who were criticizing the methods, didn't you?
A. When and where? Which attack?
Q. All right. After the Austrian Anschluss, when force was used, with your disapproval, you immediately went in and took over the Austrial National Bank, didn't you?
A. That was my duty.
Q. Yes. Well, you did it.
A. Of course.
Q. And you liquidated it for the account of the Reich.
A. Not liquidated; I merged it.
Q. All right.
A. Amalgamated.
Q. Amalgamated it. And you took over the personnel.
A. Everything.
Q. Yes. And the decree doing so was signed by you.
A. Certainly.
Q. Yes. And you called the employees together on the 21st day of March 1938.
A. Yes.
Q. And made a speech to them.
A. Yes.
Q. And did you use this language among others -
A. Certainly.
Q. Well, you haven't heard it yet.
A. Yes, we heard it during the case of the Prosecution.
Q. Well, I would like to quote some of it to you and remind you of it.
"I think it is quite useful if we recall these things to our mind in order to expose all the sanctimonious hypocrisy exuding from the foreign press. Thank God, these things could after all not hinder the great German people on their way, for Adolf Hitler has created a communion of German will and German thought; he holstered it up with the newly strengthened Wehrmacht, and he then finally gave the external form to the inner union between Germany and Austria.
"I am known for sometimes expressing thoughts which give offense and there I would not like to depart from this custom."
"Hilarity" is noted at that point in your speech.
"I know that there are even here in this country a few people -- I believe they are not too numerous -- who find fault with the events of the last few days. But nobody, I believe, doubts the goal and it should be said to all gramblers that you can't satisfy everybody. One person says he would have done it maybe in one way, but the remarkable thing is that they did not do it" -and in parentheses there appears the word "hilarity". Continuing with your speech," -- that it was only done by our Adolf Hitler (Long continued applause) and if there is still something left to be improved, then those grumblers should try to bring about these improvements from the German Reich and within the German community, but not to disturb it from without."
Did you use that language?
A. Yes.
Q. In other words, you publicly ridiculed those who were complaining of the methods, didn't you?