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your letter means, which they received from you, relating to the following documents which the letter says have been withdrawn.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informed me yesterday morning that the objections against those documents on the part of the British Delegation are withdrawn.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SIR DAVID MAXWELL-FYFE: I am still objecting to it if it is not withdrawn, My Lord.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.
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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 Sturmer which were put in crossexamination 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?
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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,
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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 his plans against Czecho- 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
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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?
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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 \
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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
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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 v.Tas 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
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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?
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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 Goering over power and rank. As such, that accusation seems to me to have been refuted already by statements which Goering 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 Goering 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.
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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 of flees 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
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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 antisocial 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 antiaircraft 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 Goering.
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 Goering 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?
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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 Goering. 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.
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[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 Fuehrer'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 Goering, 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 Goering 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
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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.
low 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 Goering 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
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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.
But I never heard anything of the serious ill-treatment and outrages-murder and the like-which started later. Probably because, firstly, these conditions did not begin until after the war, after the outbreak of war, and because already from 1939 onwards I led a very retired life. I heard of these things and of the dreadful form in which they happened only here in prison. However, I did hear, as early as 1938 and after, of the deportation of Jews; but because individual cases were brought to my notice I could only ascertain that there were deportations to Theresienstadt, where allegedly there was an assembly camp for Jews, where Jews were accommodated until a later date when the Jewish problem was to be dealt with again. Any physical ill-treatment, not to speak of killing or the like, never came to my knowledge.
DR. DIX: Did you ever take a look at a concentration camp?
SCHACHT: I had an opportunity of acquainting myself with several concentration camps when, on 23 July 1944, I myself was dragged into a concentration camp. Before that date I did not visit a single concentration camp at any time, but afterwards I got to know not only the ordinary concentration camps but also the extermination camp in Flossenburg.
DR. DIX: Did you not, while in Flossenburg, receive a visit from a "comrade-in-ideas"-if I may say so?
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SCHACHT: I know of this matter only from a letter which this gentleman sent to you or to this Tribunal, I believe, and in which he describes that visit. I can only, on my own observation...
MR. JUSTICE JACKSON: I think it is improper to give the contents of a letter from a person unidentified. I have said to this Tribunal before that these letters which come from unidentified persons -if he is identified, it has not been done in evidence-come to all of us. I am sure members of the Tribunal get a great many of them. If that is evidence, then the Prosecution should reopen its case, because I have baskets of them.
I think it is highly improper to take communications and put them in evidence directly and it is even more improper to relate all of them by oral testimony when the document is not produced. I think this kind of evidence has no probative value and I object to it.
DR. DIX: May I be permitted to say that I would never do anything improper nor have I done it. I do not intend in any way to submit this very harmless jocular letter to the Tribunal as evidence. But this letter, which reached me through quite regular channels, informed Dr. Schacht and myself that there existed a plan to murder him in Flossenburg. That is why I also questioned the witness Kaltenbrunner on this matter. The only reason why I am asking Dr. Schacht is that I expect him to inform the Tribunal that according to this information there was in fact at that time an order to murder him. This fact, not the letter, is not without some significance, because if a regime wants to kill a man then that is at least proof of the fact that it is not particularly well-disposed toward him. That is the only reason why I asked that this letter be submitted, and it is, of course, also at Mr. Justice Jackson's disposal. It is really quite an amusing letter, written by a simple man.
But I would never have considered submitting this letter as a document in evidence. If the Tribunal have objections to hearing the matter, a matter which was also discussed when Kaltenbrunner was examined, then I shall willingly omit it. I am quite astonished that the matter should be given so much significance.
THE PRESIDENT: Dr. Dix, the Tribunal thinks that the letter isn't being offered in evidence, and therefore you ought not to refer to it. Well, then, don't refer to it.
DR. DIX: All right, we shall leave it.
[Turning to the defendant.] Well' now, at last you were released. What did you do then?
SCHACHT: After that time I did nothing more apart from continuing my efforts towards the removal of Hitler. That was my only political activity. For the rest, I was living on my estate.
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DR. DIX: Did you not go on a journey in the spring of 1939?
SCHACHT: Excuse me, you are speaking of the time after the dismissal as President of the Reichsbank, I thought you meant minister. I was just talking of 1943.
DR. DIX: No. No.
SCHACHT: You are going back to the year 1939. After the dismissal in January 1939 I already mentioned that Hitler suggested to me that I should go on an extensive journey abroad and at the time I went to India by way of Switzerland, where I again saw my friends.
DR. DIX: Were you in any way politically active in India?
SCHACHT: In India I merely traveled as a tourist. I was not politically active but, of course, I visited several governors and I spent 3 days as the Viceroy's guest in his house in Simla.
DR. DIX: Did you not have political connections with Chinese statesmen in Rangoon?
SCHACHT: When I was in Burma, after leaving India, I received a visit in Rangoon from a Chinese friend who had visited me before in Berlin on occasion and who had been commissioned by his government to talk to me about the situation of China.
DR. DIX: That is Chiang Kai-Shek's China?
SCHACHT: Chiang Kai-Shek's China which was already at war with MR. JUSTICE JACKSON: I can't see the slightest relevancy to this. In the first place, we heard it once and secondly, after we had heard it it has no relevancy to the case. We have no charge against him that he did anything in China and we will stipulate that he was as pure as snow all the time he was in China. We haven't a thing to do with that and it is taking time here that just gets us nowhere and is keeping us away from the real charge in the case. THE PRESIDENT: The Tribunal quite understands that you say it is irrelevant. Why do you say it is relevant? DR. DIX: I regret that Mr. Justice Jackson and I understand each other too little. The matter is relevant in the following connection: In this testimony and also in an affidavit which has been read... THE PRESIDENT: I think we heard three times that the Defendant Schacht went to India. Three times in his evidence he dealt with the fact that he went to India and China. How is it relevant? DR. DIX: I am not speaking of the journey to India. It had to be mentioned only briefly to explain the connection of time. I put 544 2 May 46 a question, referring to Schacht's negotiations in Rangoon with the envoy from Chiang Kai-Shek-with the Chinese-and at that point Mr. Justice Jackson raised his objection. But the fact that Schacht maintained friendly connections with Chiang Kai-Shek's Government and gave support to it, that fact is relevant, and for the same reason for which I attached importance to the fact that it became clear here that in regard to the Union of Soviet Republics also Schacht pursued a pro-Soviet line in his economic policy during the years when Hitler was conducting a political campaign against Russia. Here we have a second instance, where he is demanding relations which were contrary to the principles of Hitler's policy; that is relations with Chiang Kai-Shek, and so against Hitler's ally, Japan. It is in this connection that the negotiations with the Chinese are of significance. They will take only a moment's time at most. They were merely to be mentioned in passing. THE PRESIDENT: The Tribunal thinks that if you consider his relations with China of any importance, it can be stated in one sentence. DR. DIX: I am of the same opinion. SCHACHT: I will sum it up in one sentence. In a written memorandum I advised Chiang Kai-Shek's government to continue holding out against Japan, giving as reason that the economic resources of China would last longer than the economic resources of Japan; and I advised Chiang Kai-Shek to rely primarily on the United States of America in his foreign policy. DR. DIX: Then upon your return from India, that is, in August 1939, you found a situation which must have appeared quite tense to someone who was just coming back. Did you not then attempt to contact the Cabinet or Hitler in order to discuss this situation? SCHACHT: Of course, I found a very tense situation in the question of Poland and I used my return as an occasion for writing a letter to Hitler, a letter to Goering, and a letter to Ribbentrop; that is to say, the three leading men, in order to inform them that I had come back from India, leaving it to their discretion and expecting that at least one of them would ask me for an account of my experiences; and then, I should have had an opportunity of talking to the leading men once again. To my very great surprise, I did not get an answer from Hitler at all; I received no reply from Goering; and Herr Von Ribbentrop answered me that he had taken note of my letter. There was therefore no other way for me but to make my own inquiries regarding the real state of affairs on Poland, and when things became critical I took the well-known step, which has already been described here by Herr Gisevius; namely the attempt to gain access to the Fuehrer's headquarters. 545 2 May 46 DR. DIX: We need not repeat that. The only question which I still want to ask you is what were you going to tell the generals, particularly General Von Brauchitsch, at that last moment? SCHACHT: That he still had a chance to avert a war. I knew perfectly well that bare economic and general political statements would of course accomplish nothing with Von Brauchitsch because he would then certainly have referred to Hitler's leadership. Therefore I wanted to say to him something of quite a different nature and, in my opinion, that is of the most decisive significance. I was going to remind him that he had sworn an oath of allegiance to the Weimar Constitution. I wanted to remind him that the Enabling Act did not delegate power to Hitler but to the Reich Cabinet and I wanted to remind him that in the Weimar Constitution there was and still is a clause, which has never been annulled and according to which, war cannot be declared without previous approval by the Reichstag. I was convinced that Brauchitsch would have referred me to his oath sworn to Hitler and I would have told him: '`I also have sworn this oath. You have sworn no oath other than your military one, perhaps, but this oath does not in any way invalidate the oath sworn to the Weimar Constitution; on the contrary, the oath to the Weimar Constitution is the one that is valid. It is your duty, therefore, to see to it that this entire question of war or no war be brought before the Cabinet and discussed there, and when the Reich Cabinet has made a decision, the matter will go before the Reichstag." If these two steps had been taken, then I am firmly convinced that there would have been no war. DR. DIX: You never reached Brauchitsch. We do not want to repeat the description of that whole affair or of your attempts at the Bendlerstrasse and so on. Have you anything to add to Gisevius' testimony or do you wish to change anything in it? SCHACHT: I can only confirm that Gisevius' statement is correct in every single point and I myself merely want to add that Canaris mentioned among many reasons which then kept us from making the visit, that Brauchitsch would probably have us arrested immediately if we said anything to him against the war or if we wanted to prevent him from fulfilling his oath of allegiance to Hitler. But the main reason why the visit did not come about was quite correctly stated by Gisevius. Moreover it is also mentioned by General Thomas in his affidavit which we shall later submit. The main reason was: the war was canceled. And so I went to Munich on a business matter and to my surprise while in Munich, war was declared on Poland; the country was invaded. DR. DIX: You mentioned the Reichstag a short time ago. A meeting of the Reichstag did in fact take place, though not before 546 2 May 46 the war or before the declaration of war, but immediately thereafter. At the time you were still a Minister without Portfolio. Normally you would have had to sit on the minister's bench during that meeting. Did you take part in that meeting? SCHACHT: I did not participate in that meeting at all and I would like to add at once that during the entire war, I was present at only one meeting of the Reichstag. I could not avoid it, considering the matters which I already mentioned here yesterday. It was after Hitler's return from Paris. I had to participate in this meeting of the Reichstag, which followed the reception at the station because, as I said, it would otherwise have been too obvious an affront. It was the meeting during which political matters were not dealt with at all, but at which the field marshal's rank was granted by the dozen. DR. DIX: Now, this last effort which has just been mentioned to stop the outbreak of war through Canaris brings us to the particular chapter of your attempts at a coup to overthrow Hitler and his government. We want to make it a rule, if possible, not to repeat what the witness Gisevius has already stated but only to supplement or correct or state what you know from your own memory. Before I touch upon that chapter, however, may I ask you whether you know from information you received or from other indications, that your oppositional attitude and that of your similarly minded friends, and your oppositional aims, were known in authoritative circles abroad? SCHACHT: I do not wish to repeat anything; I merely want to point out that I have already stated repeatedly here that I continually discussed the situation in Germany-thus also my own position-with my friends abroad-not only with Americans, Englishmen, and Frenchmen but also with neutrals-and I would like to add one more thing; foreign broadcasting stations did not tire at all of speaking constantly about Schacht's opposition to Hitler. My friends and family received a shock whenever information on this subject transpired in Germany. DR. DIX: When did your attempts to overthrow the Hitler government begin? SCHACHT: As early as 1937 I tried to determine which groups in Germany one might rely upon in an attempt to remove the Hitler regime. Unfortunately in the years 1935, 1936, and 1937, I got to know that all those circles in which I had placed my hope were failing, namely the scientists, the educated middle class, and the leaders of economy. 547 2 May 46 I need only mention that the scientists permitted themselves to listen to the most nonsensical National Socialist lectures without opposing them in the least. I call attention to the fact that when the economic leaders saw that I was no longer a figure in economy, they disappeared from my anteroom and thronged into that of Goering. In a word, one could not rely upon these circles. Consequently, one could depend only on the generals, on the military, because according to my conception at the time, one could certainly count on an armed resistance even by the SS bodyguard. Therefore, as has been stated here-and I do not want to pursue it further-I tried at first to contact such generals as Kluge, for instance, merely in order to ascertain whether among the military there were people with whom one could speak openly. And this first occasion led me to a great many generals whom I contacted in the course of time. DR. DIX: That was then in the year 1937; now we come to 1938, still limiting ourselves by what Gisevius has already said, merely touching on it briefly and confirming it. By the way, were you in any way directly or indirectly involved in the negotiations at Godesberg or Munich? SCHACHT: In no way. DR. DIX: Now we continue with your political work, aiming at a revolt. Is Gisevius' account of the year 1938 correct or is there something to be added to it? SCHACHT: Gisevius' statement is complete and reliable. DR. DIX: That also applies to the attempt at a coup d'etat in the late summer of 1938? SCHACHT: Yes. DR. DIX: Then came the war. Did you fold your arms after war broke out? SCHACHT: No; throughout the entire war I pleaded with every general whom I could contact. I used the same arguments which I have just mentioned in connection with the prospective interview with Brauchitsch; therefore, it was not merely theory, but I actually spoke to all these generals. DR. DIX: Was not a visit to General Hoeppner significant in this connection? SCHACHT: In 1941 I tried not only to get in touch with General Hoeppner but in a whole series of conversations I attempted to make him take action. Hoeppner was perfectly willing and prepared and later he too, unfortunately, lost his life as a consequence of 20 July 1944. 548 2 May 46 In the year 1942-and this has not been mentioned here up to now, because Gisevius did not participate-I tried again to mobilize General Von Witzleben to renewed activity. I went on a special journey to Frankfurt-on-the-Main, where he had his headquarters at that time, and Von Witzleben proved as ever to be completely resolved to act, but he told me that, of course, he could only do so if he again received a command at the front. Then I... DR. DIX: At that time Frau Strunck, who knew of these matters, was in Frankfurt? SCHACHT: She knew of these things and can confirm them. DR. DIX: Perhaps I may tell the Tribunal at this point that Frau Strunck was granted me as a witness and she was here. In order to save time, however, I have decided to dispense with this witness since she could make only cumulative statements on what Gisevius has already said and I do not think it is necessary. Schacht himself has just stated the only piece of information which she could have added, namely this trip, this special journey to Frankfurt to Von Witzleben. On the strength of experience the Tribunal will itself know that in the course of a revolutionary movement, stretching over years such as this, many journeys are made and in respect to this particular journey it is not important to submit special evidence. In order to save time, therefore, I have decided to dispense with the testimony of Frau Strunck. Excuse me, I merely wanted to say this now. Then there is the next... SCHACHT: May I perhaps say one more thing? I of course always participated in the conversations-mentioned by Gisevius here-with the other generals, that is the group of Beck, Fromm, Olbricht, et cetera. These things did not come about for some time an account of the negotiations abroad for which the generals were always waiting. I think that enough has been said here about this topic and I need not make further report on it. I come then to one last point, which does not become apparent from Gisevius' statement but about which an affidavit from Colonel Gronau will be submitted here. I can mention it quite briefly in order to save time. Naturally, together with the group of Beck, Goerdeler, my friend Strunck, Gisevius, and others I was completely informed of, and initiated into, the affair of 20 July. However, and I think it was mutual, we told each other whenever possible only those things which the other absolutely had to know, in order not to embarrass the other man, should he at any time be submitted to the tortures of the Gestapo. For that reason, apart from being in touch with Beck, Goerdeler, Gisevius, and Strunck, et cetera, I had another connection with the generals who were at the head of this revolt and that was the General of Artillery Lindemann, one of the main participants in the coup, who unfortunately also lost his life later. 549 2 May 46 DR. DIX: Perhaps it would be proper-and also more intelligible in connection with your participation in 20 July-if I read a brief part of Colonel Gronau's affidavit which refers to Lindemann. [Turning to the Tribunal.] It is Exhibit Number 39 of our document book, Page 168 of the German text and Page 176 of the English text. Is shall omit the first part of the affidavit, but I ask the Tribunal to take judicial notice of it; essentially it contains only matters on which evidence has already been given. I shall read only the part that deals with 20 July. It begins on Page 178 of the English text and on Page 170 of the German text, and I start with Question 5: "Question 5) You brought Schacht and General Lindemann together. When was that? '`Answer 5) In the fall of 1943, for the first time in years, I again saw General Lindemann, my former school and regiment comrade. While discussing politics I told him that I knew Schacht well, and General Lindemann asked to be introduced to him, whereupon I established the connection. "Question 6) What did Lindemann expect from Schacht, and what was Schacht's attitude toward him? "Answer 6) The taking up of political relations with foreign countries following a successful attempt at revolt. He promised his future co-operation. At the beginning of 1944 Lindemann made severe reproaches that the generals"- that should read "he severely reproached Lindemann"; it is incorrectly copied here-"because the generals were hesitating so long. The attempt at revolt would have to be made prior to the landing of the Allies. "Question 7) Was Lindemann involved in the attempted assassination of 20 July 1944? "Answer 7) Yes, he was one of the main figures "Question 8) Did he inform Schacht of the details of this plan? "Answer 8) Nothing about the manner in which the attempt was to be carried out; he did inform him, however, of what was to happen thereafter. "Question 9) Did Schacht approve the plan? "Answer 9) Yes. "Question 10) Did Schacht put himself at the disposal of the military in the event of a successful attempt? "Answer 10) Yes. "Question 11) Were you arrested after 20 July 1944? "Answer 11) Yes. 550 2 May 46 "Question 12) How were you able to survive your imprisonment? "Answer 12) By stoically denying complicity." Now, we have left the years 1941 and 1942 and to explain the Putsch in logical sequence we reached the year 1944, something that could not be avoided, but we must now go back again to the year 1941. You have already mentioned, in passing, the efforts made abroad. In 1941 you were in Switzerland. Did you make any efforts in that direction there? SCHACHT: Every time I went abroad I talked at length to my foreign friends and again and again looked for some way by which one might shorten the war and begin negotiations. DR. DIX: In this connection, the Fraser letter is of importance. I think the Fraser letter and the way it was smuggled into Switzerland has been sufficiently discussed by the witness Gisevius. I have on two occasions stated the contents briefly, once when the translation was discussed and again during the discussion on the admissibility of the letter as evidence before the Court. I do not think I need do it here nor that I need read it. I should merely like to submit it. It is Exhibit 31, on Page 84 of the German and Page 91 of the English text. And-I say this now, we shall discuss it later- the same applies to the article which appeared this year in the Baster Nachrichten and which deals with a conversation which an American had with Schacht recently. I shall not read that either since I have already stated the main points of its contents. I submit it as Exhibit Number 32, Page 90 of the German text and Page 99 of the English text. I might point out that this article has already been the subject of certain accusations made during the crossexamination of Gisevius by the representative of the Soviet Prosecution. GEN. RUDENKO: I should like to raise one objection in regard to Document 32; this is an article about Dr. Schacht and his ideas by an unknown writer describing his conversations with an unknown economist. The article in question was published in the Baster Nachrichten on 14 January 1946, that is, when the present Trial was already well under way, and I cannot consider that this article can be presented in evidence with regard to Schacht's case. DR. DIX: I might-may I, before the Tribunal decides, say some thing very briefly? THE PRESIDENT: Yes, certainly. DR. DIX: The article has already been admitted as evidence. We have discussed it, and the Tribunal approved the article as evidence The Tribunal can, of course, revoke that decision. I think, for me it would... 551 2 May 96 THE PRESIDENT: I think the Tribunal has always made it clear that the allowance of these documents is a provisional allowance and that when the document is actually offered in evidence, they will then decide the relevancy or its admissibility, rather, and its relevancy. DR. DIX: That is quite beyond doubt. I merely wanted to point out that we have already discussed the question once before. Of course, the Tribunal can today reject the document. I shall... THE PRESIDENT: The allowance is provisional It is not a question of the Tribunal's reversing its previous decision. The previous decision was merely provisional, and the question of admissibility now comes up for decision. DR. DIX: It is quite clear to me, Your Lordship. I am merely surprised at the objection raised by the Soviet Prosecution, inasmuch as the representative of the Soviet Delegation himself referred to that article in his observations during the cross-examination of the witness Gisevius. It is true, he did not submit it to the Tribunal but he referred to it in his observations to the witness Gisevius. However, if the Tribunal has the slightest objections to allowing the article as documentary evidence, then I shall ask permission to leave it. I will then-and I think I may-ask the witness Schacht whether it is true that in 1941 he had a conversation with an American who was a professor of national economy, a conversation which dealt with the possibility of peace. I leave it to the Tribunal For me, it is no-I thought it would be simpler, if I submitted the article. THE PRESIDENT: General Rudenko, as you have raised the objection to this document, what have you to say about the point that Dr. Dix makes that you used the document yourself in crossexamination? GEN. RUDENKO: Mr. President, we did not use this document in the cross-examination of the witness Gisevius. An explanatory question was asked in order to reach a decision on this point and I particularly emphasize... THE PRESIDENT: Will you say that again? I did not understand you. GEN. RUDENKO: I say that we did not use this document during the cross-examination of the witness Gisevius, but we did ask an explanatory question in order that when the document was presented by Dr. Dix, we could object to it as being of no probative value. I especially... THE PRESIDENT: But did you not put the contents of the document to Gisevius? I do not remember. What I want to know is did you not put the contents of the document? 552 2 May 46 GEN. RUDENKO: No, no, we did not submit the contents, and we did not discuss the substance of the document. We merely asked a question-did the witness Gisevius know about the article in the Baster Nachrichten of 14 January 1946? That was the question, and the witness answered that it was known to him. DR. DIX: May I say one more thing? It appears to me that the Soviet Delegation does not desire to have the article submitted as evidence. I therefore withdraw it as evidence. And since I have no due reasons to the contrary, no factual reason to the contrary, I can certainly fulfill this wish of the Soviet Delegation. I would like the Tribunal to consider the matter as settled. May I now put my question? [Turning to the defendant.] Well, you had conversations in Switzerland? SCHACHT: Yes. DR. DIX: What was the subject of these conversations, in broad outlines, and with whom did you have them? SCHACHT: This article, which has just been discussed... MR. JUSTICE JACKSON: First, Your Honor, may I interpose an objection? The reason I did not join in the Soviet objection to this document was that I want to know who this economist is. I vacant to check this thing. There are very peculiar circumstances about this document and I object to his retelling a conversation with an unknown economist. All I ask is that he identify time and place and person with whom he had his conversation, so that we can do a little verifying of this effort to get something before the Tribunal that did not appear until 1946. DR. DIX: The question is now being given a significance which its comparative triviality really does not merit. I shall, therefore, dispense with this question too. Please do not now refer to the conversation with the professor, and I shall leave it to the Prosecution to put the question which Mr. Justice Jackson has just mentioned during cross-examination. Well, your conversations in Switzerland, then, excepting that with the unknown professor. SCHACHT: Yes, I tried again and again to shorten the war and to bring about some form of mediation which I always sought for particularly through the good offices of the American President. That is all that I can say here. I do not think I need go into details. DR. DIX: Very well. Did you in your letters to Ribbentrop and Goering-you have already mentioned Hitler-or besides, did you, 553 2 May 46 during the war, state your views about the policy of the war in writing at any time? First of all, as far as Hitler was concerned. SCHACHT: I mentioned my discussion with Hitler in February 1940. In the summer of 1941 I wrote a detailed letter to Hitler, and the witness Lammers has admitted its existence. I do not think he was asked about the contents of this letter here, or he was not allowed to talk about it. If I may come back to it; in that letter, I pointed out somewhat as follows-I shall use direct language- "You are at present at the height of your success."-This was after the first Russian victories.-"The enemy believes that you are stronger than you really are. The alliance with Italy is rather a doubtful one, since Mussolini will one day fall and then Italy will drop out. Whether Japan can still come to your aid at all is questionable in view of Japan's weakness in the face of America. I assume that the Japanese will not be so foolish as to wage war against America. The output of steel, for instance, in spite of approximately similar population figures, amounts to one-tenth of the American production. I do not think, therefore, that Japan will enter into the war. I now recommend you at all events to reverse foreign policy completely and to attempt with every means to conclude a peace." DR. DIX: Did you state your views to Ribbentrop during the war? SCHACHT: I do not know when it was. On one occasion Herr Von Ribbentrop conveyed to me through his State Secretary, Herr Von Weizsacker, the reproachful message that I should not indulge in defeatist remarks. That may have been in 1940 or in 1941, during one of those 2 years. I asked where I had made defeatist remarks and it appeared that I had talked to my colleague Funk and had given him extensive reasons why Germany could never win this war. I held this conviction unchangeable at all times before and during the war, even after the fall of France. I answered Ribbentrop through his State Secretary that I, as Minister without Portfolio, considered it my duty to state my opinion to a ministerial colleague in its true conception, and in this written reply I maintained the view that Germany's economic power was not sufficient to wage this war. This letter, that is, a copy of this letter was sent both to Minister Funk and to Minister Ribbentrop through his State Secretary. DR. DIX: I think, Your Lordship, this would be a suitable moment . . . The Tribunal recessed until 1400 hours. 554 2 May 46 Afternoon Session DR. DIX: I spoke before of 20 July. Do you recall a statement made by Hitler about you in connection with 20 July? SCHACHT: Codefendant Minister Speer was present and told me about it. It was on 22 July 1944 when Hitler issued the order to his circle for my arrest. At that time he made derogatory remarks about me and stated that he had been greatly hindered in his rearmament program by my negative activities, and that it would have been better if he had had me shot before the war. DR. DIX: To conclude I come to a few general collective questions. Voices were heard within the country, and also abroad-and even the Prosecution, although recognizing your- intellectual capacities and the services you rendered, appears to consider it also- that it was incomprehensible that a man as clever as you did not recognize the true nature, the real intentions of Hitler in time. I would like you to state your position with regard to that accusation. SCHACHT: I should like very much to have known the gentlemen who are now judging me, at a time when it might have been of use. These are the people who always know afterwards what ought to have been done before. I can only state that first of ale from 1920 until the seizure of power by Hitler, I tried to influence the nation and foreign countries in a way which would have prevented the rise and seizure of power by a Hitler. I warned the country to be thrifty but I was not heeded. I repeatedly warned the foreign nations to develop an economic policy which would enable Germany to live. I was not heeded, although as it now appears, I was considered a clever and foresighted man. Hitler came to power because my advice was not followed. The German people were reduced to great economic need and neither... GEN. RUDENKO: Mr. President. For 2 days now we have been listening to lengthy explanations on the part of the Defendant Schacht, and I rather think that the explanations which have just been given by the Defendant Schacht are not definite answers to questions concerned with the Indictment brought against him, but mere speeches. I consider that they will only prolong the Trial. THE PRESIDENT: Dr. Dix, the Tribunal is, I think, fully apprised with the case on behalf of Defendant Schacht. They don't want to stop him putting forward his defense fully, but they would be glad if you could make it as short as possible and if he could make it as short as possible. DR. DIX: My Lord, I am certain that I shall be through by the recess, and perhaps even before the recess; but I beg you to bear 555 2 May 46 in mind that the defendant is accused of having assisted in the seizure of power. The question arises, how was it that... THE PRESIDENT: I wasn't ruling that this evidence was inadmissible. I was only asking you to get on with it as quickly as you could. DR. DIX: Very well. Dr. Schacht, please continue and try to comply with the suggestions of the representative of the Soviet Prosecution as far as possible. SCHACHT: As briefly as possible I will not go into detail; I will merely state that due to the collapse of 1918 and the unsatisfactory conditions of the Versailles Treaty, Germany was faced with a severe depression. The democratic parties, which had a firm hold on the regime at that time, were not able to improve the situation; and the other nations did not know what policy to take towards Germany. I do not reproach any one; I merely state facts. Consequently, in this state of depression, Hitler received a larger majority in the Reichstag than had ever been the case since the formation of the Reich. Now, I ask the people who, although silent at the time, can tell me now what I should have done; I ask them what they would have done. I have stated that I was against a military regime, that I wanted to avoid a civil war, and that, in keeping with democratic principles, I saw only the one possibility: To allow the man to lead the government once he had come to power. I said further that frown the moment I realized this I tried to participate in the government, not with the intention of supporting this man in his extremist ideas, but to act as a brake and, if possible, to direct his policies back into normal channels. DR. DIX: Then there came a time later when you recognized the dangers, when you yourself suffered under the unbearable conditions of terror and of suppressed opinion, so that perhaps this question is pertinent and admissible: Why did you not emigrate? SCHACHT: Had it been only a question of my personal fate, nothing would have been simpler, especially since, as we have heard before, I would have been offered that opportunity and it would have been made easy for me. It was not merely a question of my own welfare; but as I had devoted myself to the public interest since 1923, it was the question of the existence of my people, of my country. I know of no instance in history where emigrants were of help to their own nation. Of course, I speak of those emigrants who leave of their own free will, not those that have been expelled. It was not the case in 1792, at the time of the French Revolution; it vitas not the case in 1917, during the Russian Revolution; and it was not the case at the time of the National Socialist revolution which 556 2 May 46 we witnessed. To sit in a safe harbor abroad and to write articles which no one reads in the home country... THE PRESIDENT: Dr. Dix, we don't warn' a historical lecture, do we? DR. DIX: I believe we can stop here. He merely wanted to state why he did not emigrate. [Turning to the defendant.] You have been understood. SCHACHT: Thank you. DR. DIX: In the course of these proceedings, either in a Letter or in a poem-I do not know which at the moment-there was some mention of your thoughts on the possibility of dying a martyr's death; whether it would have served the cause of peace and the German nation, if you had done more than you did; if you had sacrificed your life... SCHACHT: I think that you are referring to a quotation from one of my notes, which a representative of the American Prosecution read here, in which I spoke of the silence of death. DR. DIX: Yes. SCHACHT: If I had sacrificed myself, it would not have been of the slightest use because the circumstances of my sacrifice would never have become known. Either I would have disappeared in some prison or I would have died there, and no one would have known whether I was alive or not; or I would have been the victim of a planned accident, and it would not have been possible to become a martyr. Martyrs can be effective only if their martyrdom becomes known to the public. DR. DIX: May I ask for the attention of the Tribunal for a moment? Yesterday I was denied a question concerning the social attitude of the diplomatic corps and its influence on men like Schacht, for instance. The question which I want to put now is not the same question; otherwise I would not put it. But it has nevertheless . . . THE PRESIDENT: The objection that I made was to the use of the word "attitude," because I don't see how witnesses can give evidence about the attitude of a corps. I said I think especially that the fact that the diplomatic corps were present at the Party rally might be given in evidence, but I said that the word "attitude" was far too general. What is it you want to put now? DR. DIX: Yesterday, the question which I framed in the following manner was denied: "How was Schacht influenced by the collective attitude of the diplomatic corps?" That question was denied, and that concludes the matter. Now, I should like first to clarify the matter because I do not want to create the impression 557 2 May 46 of smuggling into the proceedings a question which may raise the same objections. On the one hand, it is essential for my line of defense to show that people from abroad with judgment, who were above being suspected of wanting to prepare for an aggressive war, had the same attitude toward the regime as Schacht had. On the other hand, it is one of the strong points of my defense to show that the work of these people in their opposition was not only not supported by foreign countries but was actually made more difficult. That is the thema probandum that is important for me, and on this theme-but please, Herr Schacht, do not answer before I have received the permission of the Tribunal-this theme.... THE PRESIDENT: State exactly what the question is. DR. DIX: Yes, I will put the question now. According to my notes I intended to refer to the tokens of honor, which the Nazi regime received from abroad, and to the representatives and numerous state visits paying honor to the regime, which have already been mentioned here. I wanted to ask the defendant what influence these frequent marks of great honor had on the work and aims of this group of conspirators. However, since that question is very similar to the one that has been rejected-and I prefer to malice my objections myself rather than to have them made to me-I wanted to submit the question to the Tribunal first and make sure that it is admissible. THE PRESIDENT: Dr. Dix, the question being: "What effect did the recognition of the Nazi regime from abroad have upon the group of conspirators with whom the Defendant Schacht was in contact?" That is the question, is it not? Well, that question, as the Tribunal thinks, you may put. DR. DIX: It is admissible if "Anerkennung" is translated correctly as "honor"-honor, not recognition in the sense of recognition of a government in diplomatic official language, but honor, respect. It is a difficulty of translation and I do not want a misunderstanding-may I put to him, first, the individual official visits which I have noted, so that he can answer the question? May I do that? THE PRESIDENT: Yes, you may; actual visits? DR. DIX: Yes. The list will not be complete. [Turning to the defendant. I remind you that in 1935, the delegate of the Labor Party, Alan Hartwood. TO PRESIDENT: The Tribunal thinks that you ought to put the question in the general way in which I put it to you, and not go into details of each visit or the details of each number of visits. 558 2 May 46 MR. JUSTICE JACKSON: If Your Honor pleases, I want to object to it as generalities, because it already appears that the United States did not participate in this and I tried to keep the European politics out of this case, and this is the entering wedge. Now, I don't want to get into this sort of thing. I think it is entirely irrelevant that some foreigner, deceived by the appearance which the Defendant Schacht was assisting in putting up, didn't start a war earlier. This thing is entirely irrelevant. The United States has desired to keep this sort of thing out of this case because it is endless if we go into it. It seems to me, if Herr Schacht wants to put the responsibility for his conduct on some foreigner, that foreigner should be named. He has already said that the United States representatives, Mr. Messersmith and Mr. Dodd, had no part in it because they were always against them. Now, it gets into a situation here which seems to me impossible before this Tribunal, and I cannot understand how it constitutes any defense for mitigation for Schacht to show that the foreign powers maintained intercourse with Germany even at a period of its degeneration. THE PRESIDENT: The Tribunal thinks the question is relevant but should be put without detail. DR. DIX: I will put the question without detail, and I would like to say that I cannot, of course, speak of myself and America in the same breath; but I, too, am trying to avoid foreign politics. However, my question does not concern foreign politics. [Turning to the defendant.] Here is the one question: What influence did the honors which were showered upon the Nazi regime by foreign countries, in a manner well known to you, have on the work of your group of conspirators? SCHACHT: Throughout the years from 1935, up to and including 1938, numerous statesmen from almost all other nations came to Berlin to visit Hitler, including some crowned heads. From America, for instance, there was Under Secretary of State Phillips. DR. DIX: Do not mention any names. SCHACHT: I said that only because names were expressly mentioned here. It is not limited to Europe. I do not intend to make any political explanations, I merely say that there were so many visitors, which meant not only recognition but respect for Hitler, that this man appeared a very great man in the eyes of the German people. I still remember that in 1925, I believe, the King of Afghanistan, Amanullah, appeared in Berlin. He was the first foreigner to visit the Social Democratic Government, and there was a celebration because at last a great man from another country had visited us. In the case of Hitler, starting with 1935 there was one visitor after another; and Hitler went from one foreign political 559 2 May 46 success to another, which made it extremely difficult to enlighten the German people and made it impossible to work for that enlightenment within the German nation. DR. DIX: And now, two final questions. You have heard the speech by the British Attorney General Shawcross, who said that there should have been a point where the servants of Hitler refused to follow him. We want to accept that point of view, and I ask you: Do you believe that you yourself acted in accord with that postulate of the leader of the British Delegation? SCHACHT: I not only accept it, but I fully approve of it. From the very moment when I recognized what a harmful individual Hitler was, what a threat to world peace, I broke with him, not only secretly, but publicly and personally. DR. DIX: So you consider that when you realized the truth you did everything humanly possible to try and save humanity from the disaster of this war and bring it to an end, once it had started. SCHACHT: I know of no one in Germany who would have done more in that respect than I did. I warned against excessive armament. I impeded, and if you like, sabotaged effective armament through my economic policy. I resigned from the Ministry of Economics against the will of Hitler; I publicly protested to Hitler against all the abuses of the Party; I continuously warned people abroad and gave them information; I attempted to influence the policy of other nations with respect to the colonial question in order to achieve a more peaceful atmosphere. Credits for continued armaments. THE PRESIDENT: I think we have heard this more than once, you know. DR. DIX: Yes. SCHACHT: May I be permitted one sentence: I blocked Hitler's credits and I finally tried to remove him. DR. DIX: Gentlemen, I am now at the end of my presentation of evidence for Schacht's case, and I have only one request. During the last few days, I have received a large number of letters and also affidavits from well-known people who know Schacht. I will examine them; and if I should decide that any of the affidavits are relevant, I will get in touch with the Prosecution and discuss with them whether they have any objection to having them translated, so that we can perhaps submit them to the Tribunal-not to have them read, but merely to have them put in evidence. May I request that I be granted this right. 560 2 May 46 At the end of my entire presentation, I will briefly submit my documents; this has been only partially done. MR. PRESIDENT: Do any of the other defendants' counsel wish to ask any questions? DR. VON LUDINGHAUSEN: I have only a few questions to put to Dr. Schacht. How long have you known Herr Von Neurath, Dr. Schacht? SCHACHT: I cannot state the exact year, but at any rate for a very long time; for many, many years DR. VON LUDINGHAUSEN: For some time, for about 4 years, you were both colleagues as ministers in the government. During that time, did you have any contact with him other than in purely official capacity? SCHACHT: Unfortunately not enough, but of course I saw him from time to time. I would have liked to have seen him more often. DR. VON LUDINGHAUSEN: But from conversations with him, or from what you heard about him, you certainly formed an opinion about his political views. SCHACHT: I was well acquainted with his views. DR. VON LUDINGHAUSEN: And what was the trend of his political thought? SCHACHT: I had the impression that basically Von Neurath believed in a conservative policy, but was open to conviction where progressive measures were concerned. He was above all in favor of peaceful international co-operation. DR. VON LUDINGHAUSEN: Do you consider it possible, or do you have any reason to believe, that under certain circumstances he would also resort to belligerent methods or that he would even consider them, if the peaceful understanding which he desired was quite impossible? SCHACHT: According to my understanding of Neurath, I think that he was entirely averse to any aggressive policy. DR. VON LUDINGHAUSEN: You witnessed the various . . . THE PRESIDENT: Dr. Ludinghausen, will you kindly put the earphones on, the Tribunal thinks these questions are not questions which can properly be put because of their general nature. DR. VON LUDINGHAUSEN: Did you have the impression that in everything that he achieved, particularly in the occupation of the Rhineland, Herr Von Neurath... THE PRESIDENT: Dr. Ludinghausen, this is not a proper question to put to a witness, "Did you have an impression about him?" 561 2 May 46 You can ask him what he said and what he did; what did Von Neurath do and what did he say? DR. VON LUDINGHAUSEN: Yes; then I will not put this question. I have only one last question. [Turning to the defendant.] You know that on the 4th of February 1938 Von Neurath resigned as Foreign Minister. What did you and your immediate circle say to the resignation of Von Neurath from foreign politics? What impression did it make upon you? SCHACHT: I believe I have already said in the course of the interrogation that I considered Von Neurath's resignation a very bad sign, for it meant departing from the previous policy of understanding in foreign politics. DR. VON LUDINGHAUSEN: I have no further questions. THE PRESIDENT: Any other defendants' counsel want to ask questions? Does the Prosecution desire to cross-examine? MR. JUSTICE JACKSON: I think it might save time, Your Honor, if we could take our recess at this time. It is a little early, I know, but it takes some time to arrange our material THE PRESIDENT: Certainly. [A recess was taken.] MR. JUSTICE JACKSON: Dr. Schacht, according to the transcript of the testimony at Page 8698 (Volume XII, Page 460), you said that in 1938 you told a certain lady while you were dining: "My dear lady, we have fallen into the hands of criminals. How could I ever have suspected that!" You recall that testimony? SCHACHT: It was not I who gave that testimony; it came from an affidavit submitted here by my Defense Counsel, but it is correct. MR. JUSTICE JACKSON: I am sure you want to help the Tribunal by telling us who those criminals were. SCHACHT: Hitler and his confederates. MR. JUSTICE JACKSON: Well, you were there; you know who the co-operators were. I am asking you to name all that you put in that category of criminals with Hitler. Hitler, you know, is dead. SCHACHT: Mr. Justice, it is very difficult for me to answer that question fully because I do not know who was in that close conspiracy with Hitler. The Defendant Goering has told us here that he considered himself one of that group. There were Himmler and Bormann, but I do not know who else there was in the small circle of men who were trusted by Hitler. 562 2 May 46 MR. JUSTICE JACKSON: You have only named three men. Let me put it this way: You named four men criminals, three of whom are dead and one of them you say admitted.. SCHACHT: I can add one more, if you will permit me. I assume that the Foreign Minister Von Ribbentrop was also always acquainted with Hitler's plans. I must assume that; I cannot prove it. MR. JUSTICE JACKSON: Whom else did you include when you were talking to the lady? SCHACHT: On that evening I did not mention any names. MR. JUSTICE JACKSON: But whom did you have in mind? You surely were not making charges against your own people, who were in charge of your own government, without having definite names in mind. SCHACHT: I have taken the liberty of mentioning the names to you. MR. JUSTICE JACKSON: Are those all? SCHACHT: I do not know, but I assume that there were more. I would add without hesitation, Heydrich. But I cannot know with whom . . . MR. JUSTICE JACKSON: Heydrich is a dead man. SCHACHT: I regret that these people are dead, I would have liked to see them die some other way; but... MR. JUSTICE JACKSON: Well, are those the only people that you included? SCHACHT: I have no proof of the fact that there was anyone else in this conspiracy about whom I could say that there is proof that he was a conspirator. MR. JUSTICE JACKSON: Now, Dr. Schacht, at the time the Nazis seized power you had a world-wide acquaintance and very great standing as a leading banker in Germany and in the world, did you not? SCHACHT: I do not know whether that is so, but if that is your opinion I do not wish to contradict you. MR. JUSTICE JACKSON: Well, at first you would admit that? Wouldn't you? SCHACHT: I do not contradict. MR. JUSTICE JACKSON: And yet as we understand it, you made public appearances in Germany before the German people in support of the Nazi regime, alongside of characters such as Streicher and Bormann. 563 2 May 46 SCHACHT: Mr. Justice, I have taken the liberty of explaining here that until July 1932 I did not in any way come forward publicly for Hitler or the Party and that, on the contrary, in America for instance, I warned the people against Hitler. At that time I-the name Bormann was, of course, unknown to me at the time; and Streicher's paper, Der Sturmer, was just as revolting to me before that time as afterwards. I did not think that I had anything in common with Herr Streicher. MR. JUSTICE JACKSON: Well, I didn't either, but that is why I wondered about your appearing with him publicly before the German people after 1933 when the Nazi regime was consolidating its power. You did that, didn't you? SCHACHT: What did I do, Mr. Justice? MR. JUSTICE JACKSON: I spoke of your appearances, publicly, before the German people with Streicher and Bormann in support of the Nazi program after the seizure of power. SCHACHT: I do not think so. I was never seen publicly with Herr Streicher or with Mr. Bormann-certainly not at that time. It is quite possible that he attended the same Party rallies as I, or that I sat next to him; but, at any rate, in 1933 I was never seen publicly either with Streicher or with Bormann. MR. JUSTICE JACKSON: I ask to have you shown the photograph from the Hoffmann collection, marked Number 10. You have no difficulty recognizing yourself in that, do you? SCHACHT: No. MR. JUSTICE JACKSON: And on the right sits Bormann? SCHACHT: Yes. MA JUSTICE JACKSON: And next to him the Minister of Labor? SCHACHT: Yes. MR. JUSTICE JACKSON: And on the other side of you is Hitler? SCHACHT: Yes. MR. JUSTICE JACKSON: And beyond him, Streicher? SCHACHT: I do not recognize him; I do not know whether it is Streicher, but perhaps it is. MR. JUSTICE JACKSON: Well, I will offer the photograph in evidence. And perhaps the identification will be sufficient. And also Frick is in that picture? SCHACHT: Yes. 564 2 May 46 MR. JUSTICE JACKSON: This becomes Exhibit Number USA-829. [Turning to the defendant.] I will ask to have you shown. . . THE PRESIDENT: Justice Jackson, what is the date of that photograph? MR. JUSTICE JACKSON: There is no date given on the photographs. Perhaps the defendant can tell us. SCHACHT: Mr. Justice, you said that in 1933 I had permitted myself to be seen publicly with Streicher and Bormann as a representative of the National Socialist Party; and I should like to know, therefore, where this, picture was taken and when. I cannot identify it. MR. JUSTICE JACKSON: I asked you about after 1933. Schacht, do you deny this is a photograph... SCHACHT: No, no. By no means. I am merely asking when it was taken. I do not think this refers to 1933 or 1934. MR. JUSTICE JACKSON: When was it, if you want to tell us? SCHACHT: I do not know; I cannot tell you. MR. JUSTICE JACKSON: I will show you another photograph- two photographs, Numbers 3 and 4. Number 3 shows you marching with Dr. Robert Ley among others. SCHACHT: Yes. MR. JUSTICE JACKSON: Number 4 shows you entering the hall, marching, and giving the Nazi salute. SCHACHT: Yes, yes. MR. JUSTICE JACKSON: And Ley the man who suppressed the labor unions of Germany? SCHACHT: Yes. MR. JUSTICE JACKSON: And those are correct photographs, are they not? SCHACHT: Certainly. MR. JUSTICE JACKSON: I offer them in evidence under Exhibit Number USA-829. [Turning to the defendant. I will show you photographs marked Numbers 1 and 2 and 6-and 7. Now let us look at Number 1. Do you recall where that was taken? SCHACHT: Yes-one moment, if it is the number I have here- yes, just a minute., MR. JUSTICE JACKSON: Where was it taken? 565 2 May 46 SCHACHT: I think Number 1 is a picture from the Reich Chancellery, if I am not mistaken. MR. JUSTICE JACKSON: Among the persona appearing in Number 1 is Frick? SCHACHT: Gurtner, Goebbels, Popitz, Schacht, Papen, Goering, and others, and Hitler in the middle. MR. JUSTICE JACKSON: And Neurath, do you recognize? SCHACHT: Neurath. Yes; I think he is immediately on Hitler's right, in the background. MR. JUSTICE JACKSON: Goebbels? SCHACHT: Yes, I said Goebbels. MR. JUSTICE JACKSON: You identify Funk as present in the picture, at the extreme right, only a part of his body showing. SCHACHT: Who is that? MR. JUSTICE JACKSON: Funk, the Defendant Funk. SCHACHT: No, that is Goering. MR. JUSTICE JACKSON: Back of Goering and back of Neurath SCHACHT: I beg your pardon. Perhaps I have a different picture. I beg your pardon. That is Number 2. On Number 2 I see from left to right: Popitz, Rust, Goering, Neurath, Hitler, Blomberg, Schacht, Gurtner, Krosigk, Eltz van Rubenach, and then at the very back on the right, Funk. MR. JUSTICE JACKSON: And let us take Number 7. Who do you identify as your company in that photograph? SCHACHT: On the extreme left, my late wife; then the Vice President of the Reichsbank, Dreyse, Hitler, and myself. There is an adjutant of Hitler, and the heavy-set man on the right-I do not know who he is. This is a photograph taken when the foundation of the new Reichsbank building was laid in 1934. Directly behind me, on the right, is Blomberg. MR. JUSTICE JACKSON: And Number 6? SCHACHT: One moment. That is the picture where I am walking alongside Hitler, is that right? That is Hitler's entrance in my company, on the occasion when the foundation of the new Reichsbank building was laid. Behind me, or rather behind Hitler, you can see Geheimrat Vocke, who is to appear as a witness here tomorrow, and several other gentlemen from the directorate of the Reichsbank. MR. JUSTICE JACKSON: I offer the remaining photographs, 1, 6, and 7 in evidence under the same number. 566 2 May 46 So that it would appear, Dr. Schacht, that a good deal of your present company was the company that started off with you in 1933 and 1934? SCHACHT: Is that a question? MR. JUSTICE JACKSON: Well, is that not true? SCHACHT: No. If you had photographed me with my other acquaintances just as often, the number would be 10 times as great. MR. JUSTICE JACKSON: You testified-and I refer to Page 8650 of the record (Volume XII, Page 424)-that there were reasons of principle why you did not become a Party member and that Party membership would not be compatible with your principles? SCHACHT: That is right. MR. JUSTICE JACKSON: And you also testified-I refer to Page 8692 of the record (Volume XII, Page 455)-that from 1932 to the 30th of January 1933-I am quoting you, "I have not written or spoken a single word publicly for Hitler." SCHACHT: I think that is right, if you emphasize "publicly." MR. JUSTICE JACKSON: You must emphasize "publicly"? SCHACHT: Yes. MR. JUSTICE JACKSON: I want yet to ask you about the next thing. You also said: "I have never helped in any way to exert influence in favor of Hitler through discussions with any of the competent gentlemen: Hindenburg, Meissner, et cetera; and I did not participate in any way in the appointment of Hitler to Reich Chancellor." Is that correct? SCHACHT: That is correct. MR. JUSTICE JACKSON: Now, are there any words that we have to emphasize in that in order to understand it correctly? SCHACHT: No, in reference to Hitler's becoming Chancellor, please note I said, "competent men." MR. JUSTICE JACKSON: Well, I don't just know what you mean by that, but I'll give you a chance to explain. SCHACHT Yes. When I say "competent," I mean those people who could decide as to who was to be Chancellor. Of course, 1 did say that Hitler would be Chancellor and must become Chancellor, and I expressed those convictions in private circles. MR. JUSTICE JACKSON: Did you say that in public? SCHACHT: No, I said that only in a circle of my friends, business acquaintances, and such like. 567 2 May 46 MR. JUSTICE JACKSON: Now, I want to quote you a statement by Von Papen: "When I was Chancellor of Germany, in 1932, Schacht came to see me in July or August while I was at home. He said, 'here's a very intelligent man.'-It was in the presence of my wife and I have never forgotten it.-He said, 'Give him your position. Give it to Hitler. He is the only man who can save Germany.' " Did you say that or didn't you? SCHACHT: I do not know whether I said that he was the only man who could save Germany, but I did tell him that Hitler would and must become Chancellor. But that was in August or July of 1932, after the July elections; and it has nothing to do with Hitler's nomination, which did not take place until after the Schleicher Cabinet, about which I have been examined here. MR. JUSTICE JACKSON: Now; Dr. Schacht, I just asked you if you had not testified that you had nothing to do with his coming to the Chancellorship and you said... SCHACHT: That is the truth. MR. JUSTICE JACKSON: . . . and it is here said that you asked Von Papen to give the place to him and... SCHACHT: Yes. MR. JUSTICE JACKSON: . . . and do you contend-and I want you to say anything you want to about this-do you contend that that was not aiding Hitler to the Chancellorship? SCHACHT: I do not know whether it was aiding Hitler. the course of my examination here, I have been asked whether I had exerted any influence in connection with Hitler's election or his nomination for the Chancellorship in January 1933. I have given the names of Hindenburg, Meissner, and so forth, that is to say, Hindenburg's circle. Since the beginning of November 1932,. Papen was no longer Chancellor and thus he had no influence upon these matters at all. I did not talk to Papen at all during those weeks. On the contrary, after the elections of 1932, I said that it was inevitable that a man who had obtained so many votes in the Reichstag must take over the political lead. MR. JUSTICE JACKSON: Now let me get you correctly. When you saw Hitler was going to win you joined him? SCHACHT: No. MR. JUSTICE JACKSON: Well, I'll just make it clear what you do mean. You did not assist him until he had already accumulated more votes than any other Party in the Reichstag? 568 2 May 46 SCHACHT: I did not join Hitler when I saw that he would win, but when I had discovered that he had won. MR. JUSTICE JACKSON: Oh, well, I'll accept the amendment. You have referred to your letter to Hitler on the 29th of August 1932... SCHACHT: Yes. MR. JUSTICE JACKSON: . . . in which you advised him not to put forward any detailed economic program? SCHACHT: Yes. MR. JUSTICE JACKSON: You told him there was no such program on which 14 millions could agree? SCHACHT: Yes. MR. JUSTICE JACKSON: And that economic policy is not a factor for building up a party? SCHACHT: Yes. MR. JUSTICE JACKSON: And you added that, "You can always count on me as your reliable assistant"; did you not? SCHACHT: Yes. MR. JUSTICE JACKSON: And then that was after he had won? SCHACHT: Yes. MR. JUSTICE JACKSON: And then on the 12th of . . . SCHACHT: November. MR. JUSTICE JACKSON: Yes, I just want to refer to that document as EC-456, Exhibit Number USA-773. Now, then, on the 12th of November 1932, you wrote a letter to him, in which you said, among other things, "I have no doubt that the present development of things can only lead to your becoming Chancellor." SCHACHT: Yes. MR. JUSTICE JACKSON: "It seems as if our attempt to collect a number of signatures from business circles for this purpose is not altogether in vain..." SCHACHT: Yes. MR. JUSTICE JACKSON: You were collecting signatures for this purpose? SCHACHT: Not I, but I participated. MR. JUSTICE JACKSON: You were assisting. SCHACHT: Yes. MR. JUSTICE JACKSON: And that was Document Number EC-456. 569 2 May 46 Now, as of November 1932, a document was prepared for a large number of industrialists to sign, urging the selection of Hitler as Chancellor, in substance, was there not? SCHACHT: I no longer remember the document, but I assume that that is the document. MR. JUSTICE JACKSON: And men like Schacht, Schroder, and Krupp, and a great number of industrialists signed that document, did they not? SCHACHT: That is possible, yes. MR. JUSTICE JACKSON: And it was sent to Von Hindenburg? SCHACHT: I do not know. MR. JUSTICE JACKSON: Well, the purpose' of it was to aid Hitler in obtaining the Chancellorship? SCHACHT: That is possible. MR. JUSTICE JACKSON: It is addressed to the Reich President, is it not? Document Number 3901-PS, Exhibit Number USA-837. SCHACHT: I have not seen it; but it is probably correct. MR. JUSTICE JACKSON: Well, you do not deny that that occurred? SCHACHT: I assume that it is correct. I have not seen it, but I do not doubt it at all. MR. JUSTICE JACKSON: Then, in November of 1932 you communicated to Hitler the result of your money-raising campaign, did you not? SCHACHT: I do not know anything about that. MR. JUSTICE JACKSON: Well, I'll remind you from your own interrogation. Well, I'll remind you first, of your testimony, in which you say that it appears that you did not plead for funds but that Goering pleaded for funds; and I ask if you did not, on the 9th of October 1945, give these answers to these questions as to events of February 1933? SCHACHT: Events of what? MR. JUSTICE JACKSON: Events of February 1933. SCHACHT: Yes, thank you very much. MR. JUSTICE JACKSON: Going back to 1933. This is the question: "Prior to the time that Hitler appointed you as President of the Reichsbank, do you recall a meeting in the home of Goering? 570 2 May 46 "Answer: 'Yes. That was a financial meeting. I have been interrogated about that several times already.' "Question: 'Tell me about it.' "Answer: 'Yes, I will.` Hitler had to go to the elections on 5 March, if you will remember, and for these elections he wanted money for the campaign. He asked me to procure the money and I did. Goering called these men together and I made a speech-not a speech, for Hitler made the speech-then I asked them to write down the amounts and to subscribe for the elections, which they did. They subscribed a total of 3 millions and they allocated the sum among themselves.' "Question: 'Who were the people who made up that subscription list?' "Answer: 'I think that all of them were bankers and industrialists. They represented the chemical industry, iron industry, textile industry, all of them.' "Question: 'Representatives of all the industries?' "Answer: 'All of them; all of the big industries.' "Question: 'Do you recall any of their names?' "Answer: 'Oh certainly; Krupp was there-the old gentleman, Gustav. He arose from his seat and thanked Hitler and was very enthusiastic about him at the time. And then there was Schnitaler-I think it was he-and Vogler for the United Steel Works."' Did you give that testimony? SCHACHT: Certainly. MR. JUSTICE JACKSON: Now, at that meeting you have referred to Document Number D-203, which is a record of the meeting-at that meeting Goering said this in substance, did he not? "The sacrifices which are required would be so much easier for industry to bear if it knew that the election of 5 March would surely be the last one for the next 10 years, probably even for the next 100 years." You heard that, did you not? SCHACHT: Yes. MR. JUSTICE JACKSON: Now yesterday or the day before you were interrogated about your support and about the tribute that Goebbels paid to you; and you said to the Court, "It is not my fault if Goebbels made a mistake." Do you recall that? SCHACHT: Yes. MR. JUSTICE JACKSON: And I ask you, if testifying about Dr. Goebbels you did not say this to the interrogator of the United 571 2 May 46 States, on the 17th day of October 1945, Exhibit Number USA-616 (Document Number 3729-PS)? "Question: 'When did you become interested in becoming a co-worker of Hitler?' "Answer: 'I should say in the years of 1931, 1932.' "Question: 'And that was when you saw that he had a mass movement that was likely to take power?' "Answer: 'Quite right; it was growing continually.' "Question: 'And did you publicly record your support for Hitler in those years?' "Answer: 'I think I made a statement in December 1930 once at the Bavarian People's Party, upon coming back from America. I said that there was a choice for any future Government, either to hold against 25 percent socialists, or against 20 percent National Socialists.' "Question: 'But what I mean-to make it very brief indeed- did you lend the prestige of your name to help Hitler come to power?' "Answer: 'I stated publicly that I expected Hitler to come into power for the first time that I remember in November 1932.' "Question: 'And you know, or perhaps you don't, that Goebbels in his diary, records with great affection...' "Answer: 'Yes.' ,' "Question: '. . . the help that you gave him at that time?' "Answer: 'Yes, I know that.' "Question: 'November 1932?' "Answer: 'You say the book is called From the Kaiserhof to the Reich Chancellery?' "Question: 'That's right; you have read that?' "Answer: 'Yes.' "Question: 'And you don't deny that Goebbels was right?' "Answer: 'I think his impression was that he was correct at that time.' " Did you give that testimony? SCHACHT: Yes. I never doubted that Goebbels was under this impression; I merely said that he was mistaken. MR. JUSTICE JACKSON: Then you didn't-Well, I won't bother. Now, you made some extensive quotations from Ambassador Dodd yesterday, the day before. Did you not? SCHACHT: Yes. 572 2 May 46 MR. JUSTICE JACKSON: And let's have this understood: Ambassador Dodd was consistently and at all times opposed to the entire Nazi outfit, wasn't he? SCHACHT: Yes. MR. JUSTICE JACKSON: So you got no encouragement from him to be in this outfit? SCHACHT: Oh, no. MR. JUSTICE JACKSON: Now, you testified, as I understood you, that Ambassador Dodd invited you to go to the United States of America and you say-I am quoting from Page 8670 of the record (Volume XII, Page 439): "At that time, 1937, he called on me and urged me to go with him, or follow him as soon as possible, and change my residence to America. He said that I would find a very pleasant welcome in America. I believe he never would have said that to me if he had not had a friendly feeling towards me." You said that to the Tribunal? SCHACHT: Yes. MR. JUSTICE JACKSON: And I think you intended to convey to the Tribunal the impression that Ambassador Dodd had great confidence in you and great friendship for you? SCHACHT: I had that impression. MR. JUSTICE JACKSON: Have you read his entire diary, or did you confine yourself to reading extracts? SCHACHT: Yes. I also know of the passage where he said, "You would make a very bad American," or something like that. MR. JUSTICE JACKSON: Yes, yes, you didn't mention that to the Tribunal. SCHACHT: I think that would be better for the Prosecution. MR. JUSTICE JACKSON: Well, we are not disappointing you then. Are you not familiar with his entry under the date of December 21, 1937, where he speaks of the luncheon at which you were present? "Schacht spoke of the defeat of Germany in 1918 as wholly due to Woodrow Wilson's bringing America into the World War. But I said Wilson's Fourteen Points were the one great promise of international peace and co-operation, and every country on both sides had helped to defeat his purpose. Don't you think Wilson, 50 years from now, will be regarded as one of the greatest presidents the United States has ever had? He 573 2 May 46 evaded an answer but turned his attention to the Japanese-Chinese war and opposed Germany's alliance to Japan. Then he showed the true German attitude, quoting, 'If the United States would stop the Japanese War and leave Germany to have her way in Europe, we would have world peace.' " SCHACHT: What is the question? MR. JUSTICE JACKSON: Did you make those statements? SCHACHT: I do not know whether I said it, but even today it seems an extremely reasonable statement. I am of the opinion that it was correct with one exception, I believe... MR. JUSTICE JACKSON: Yes, now let's get this straight. As I understand you correctly, you can have peace, world peace, if Germany was left to have her way in Europe? SCHACHT'. Yes. May I say that there were various opinions about the path Germany was to take; mine was a peaceful one. MR. JUSTICE JACKSON: Now, he goes on: "I did not comment, and others also failed to make remarks. Schacht meant what the Army Chiefs of 1914 meant when they invaded Belgium, expecting to conquer France in 6 weeks, namely; domination and annexation of neighboring little countries, especially north and east." SCHACHT: Am I to reply? MR. JUSTICE JACKSON: Did you say that? SCHACHT: No, no. MR. JUSTICE JACKSON: Was that what Dodd said about your conversation? SCHACHT: But I did not say that. MR. JUSTICE JACKSON: And you? SCHACHT: No, may I... MR. JUSTICE JACKSON: What was the impression? SCHACHT: No, may I answer please? MR. JUSTICE JACKSON: I ask you this question: What is the impression received over the course of his acquaintance with you by a man whom you describe as being a decent fellow and a friend of yours? SCHACHT: May I answer that I have already stated that Mr. Dodd was the victim of many misconceptions. In this case, too, he does not say that I said it; he says, "Schacht meant." That was his opinion which he attributed to me. I never said that. MR. JUSTICE JACKSON: I so understood it; but it was the estimate of a friendly observer' I take it from you. 574 2 May 46 SCHACHT: A friendly observer who continually misunderstood; Ambassador Henderson has proved that in his book. MR. JUSTICE JACKSON: He may have misunderstood Henderson; but there is never any doubt that he understood the Nazi danger from the beginning, is there? SCHACHT: Yes; but he misunderstood my attitude. MR. JUSTICE JACKSON: Now, when you went and asked first the Foreign Minister and then Hitler to go to the United States, or have some one go to the United States, you testified, on Page 8708 of the record (Volume XII, Page 467) that you told Hitler this: "It seems vital to me that there should be someone constantly in America who could clarify German interests publicly, in the press, et cetera." Did you say that? SCHACHT: Yes. MR. JUSTICE JACKSON: Now, is that what you actually said to Hitler? SCHACHT: Yes. MR. JUSTICE JACKSON: Now, I call your attention to your own letter, Document Number 3700-PS to the Reich Marshal "In the beginning of 1940 I proposed to the Fuehrer that I should go to the United States in order to attempt to slow down America's assistance to England in the matter of armaments and, if possible, to prevent America becoming involved more deeply in the war." I ask you, which of those is true? SCHACHT: Both of them. MR. JUSTICE JACKSON: Both? Then you did not reveal to the Tribunal yesterday, when you reported the conversation, all that you had pretended that you would do in the United States, did you? SCHACHT: No, certainly not. I wanted, for instance, to try to persuade the President to intervene for peace. That, too, I did not mention here. MR. JUSTICE JACKSON: Now, you also testified yesterday that you were never told about the extent, the type, and the speed of rearmament. Do you recall that? SCHACHT: Yes. MR. JUSTICE JACKSON: But although you had no such information, you said it was too much? SCHACHT: I had the feeling that one ought to go slowly. 575 2 May 46 MR. JUSTICE JACKSON: Now, let me remind you of certain statements made by General Von Blomberg concerning 1937. "Answer: 'At that time, the organization of the planned Wehrmacht was about complete.' "Question: 'When? 1937?' "Answer: 'I believe it was 1937.' "Question: 'Was that a plan that had been discussed with Doctor Schacht in connection with the financing, as to how big the Wehrmacht would be?' "Answer: 'Yes. Schacht knew the plan for the formation of the Wehrmacht very well, since we informed him every year about the creation of new formations for which we had been expending money. I remember that in the year 1937 we discussed what the Wehrmacht would need for current expenses after a large amount had been spent for creating it.' "Question: 'That means that you gave Schacht a clear statement of how much money each year went into the creation of new units, new installations, and so forth, and how much you were using for the operating expenses of the Wehrmacht?' "Answer: 'Exactly right.' "Question: When you say that by 1937 the plan had been fulfilled, do you mean in the main?' "Answer: 'In the main."' Another question. I skip two or three irrelevant ones. "When you say that Schacht was familiar with those figures, how were they brought to his attention? "Answer: 'The demands for the money needed were handed to Schacht in writing.' "Question: 'That means that in connection with the money which Schacht was raising for the rearmament program, he was informed of how many divisions and how many tanks and so forth would be procured through these means?' `'Answer: 'I don't think we put down the amount of money we would need for every tank and so forth, but we would put down how much every branch of the Wehrmacht, like the Navy or Air Force, needed, and then we would state how much was required for activating and how much for operating.' "Question: 'That is, Doctor Schacht could see each year how much of an increase there would be in the size of the Armed Forces as a result of the money he was procuring?' 576 2 May 46 "Answer: 'That is certain.' " I ask whether you deny the statements made by Von Blomberg as I have put them to you? SCHACHT: Yes, unfortunately, I must say that I know nothing about this. A member of the Reichsbank Directorate, Geheimrat Vocke, will testify tomorrow; and I ask that you put this matter to him so that the question will be clarified. The question was not one of informing me, but of informing the Reichsbank Directorate. Everything that I knew the Reichsbank Directorate naturally also knew. MR. JUSTICE JACKSON: Dr. Schacht, I don't care whether you know or didn't know as far as the Prosecution's case is concerned. What I am asking you these questions for is to know how far we can rely on your testimony. SCHACHT: Yes, I understand. MR. JUSTICE JACKSON: So there will be no misunderstanding about that. And you deny that Von Blomberg was telling the truth when he says, when he reported to you in writing, those facts? SCHACHT: Yes, unfortunately I must deny it. Evidently he does not remember. MR. JUSTICE JACKSON: Now, you testified yesterday or the day before, that the so-called New Plan had nothing to do with the armament program, did you not? SCHACHT: Nothing in particular with armament. MR. JUSTICE JACKSON: Oh, nothing in particular. SCHACHT: No. I mean of course-the Tribunal was expressly asked whether I was to speak about the New Plan here or not, and the Tribunal decided that it was to be brought up at your crossexamination. I am prepared to inform you now about the New Plan before you... MR. JUSTICE JACKSON: Now, Dr. Schacht, you have no objection to answering my questions, have you? SCHACHT: Certainly not. MR. JUSTICE JACKSON: I am referring to the answer which you gave-the one which you were not allowed to give-find the Page 8732 of this record (Volume XII, Pages 484 and 485): "Question: 'Some of your economic policies during the time you were Minister of Economics, which have been accused as being in preparation for war, were the so-called New Plan. What was that?"' 577 2 May 46 And your answer: "May I state first of all that the New Plan had nothing at all to do with rearmament." And then you went into an explanation of the New Plan which the Court did not receive, and I am asking you only this question: Did you not say, in your speech on the Miracle of Finance on the 29th day of November 1938, this-after quoting a great number of figures: "These figures show how much the New Plan contributed to the execution of the armament program as well as to the securing of our food." Did you say that or didn't you? SCHACHT: Yes. MR. JUSTICE JACKSON: That is Document Number EC-611, Exhibit Number USA-622. Now, I understood you to say in your testimony that you really didn't have anything to do socially with Hitler or with the other Nazis and that you refused their invitation to lunch at the Reich Chancellery; and one of the chief reasons was that those present showed such abject humility to Hitler. Did you say that? SCHACHT: Yes. MR. JUSTICE JACKSON: Now, I want to read to you from your speech, Document Number EC-501, your inaugural speech on the occasion of the Fuehrer's birthday. This was a public speech, by the way, wasn't it? SCHACHT: I do not know. I do not remember. MR. JUSTICE JACKSON: You made a speech on the Fuehrer's birthday on the 21st of April 1937, carried in the newspapers? SCHACHT: Maybe. MR. JUSTICE JACKSON: "We are meeting together here to remember with respect and love the man to whom the German people entrusted the control of its destiny more than 4 years ago." And then, after some other remarks, you say, "With the limitless passion of a glowing heart and the infallible instinct of a born statesman, Adolf Hitler, in a struggle which he led for 14 years with calm logic, has won for himself the soul of the German people." Was that a part of your published and public speech? SCHACHT: I assume that you have quoted it quite correctly. I do not believe that anyone, on the occasion of the birthday celebration of the head of a state, could say anything very different. 578 2 May 46 Mr. Justice, may I make one request. You have completely passed over the New Plan, while the Tribunal has pointed out that it was to be discussed here in cross-examination. If you are not going to refer to the New Plan, may I ask that the New Plan be discussed again in re-examination by my attorney. MR. JUSTICE JACKSON: I did not ask you what the New Plan was; I asked whether your statement that it had nothing to do with armaments was true or not. But if your solicitor wants to ask about it, it is open to ruling by the Tribunal. You quoted today Hitler's letter of the 19th of January 1939, in which you were dismissed from the presidency of the Reichsbank; and you did not quote the concluding sentence, as I recall it, which reads, "I am happy to be able to avail myself of your services for the solution of new tasks in your position as Reich Minister." That is a correct quotation, is it not? SCHACHT: I refer to the testimony by the witness Gisevius, who has already said that outwardly Hitler would never indicate that there was dissension between himself and his collaborators but that he always attempted to give a false impression to the world. After January 1939 Hitler never asked for my opinion or my cooperation. MR. JUSTICE JACKSON: Were you asked by anyone else? SCHACHT: No. I cited this morning the occasions when I was asked for assistance. That was in connection with Belgium, and in connection with the periodical, Das Reich. I think that was all. MR. JUSTICE JACKSON: And you performed no functions whatever in reference to Belgium? SCHACHT: No. MR. JUSTICE JACKSON: Now, I quote your letter of the 17th of October 1940 to the Reich Minister of Economics, Document EC-504, USA-830. At that time you had ceased to be President of the Reichsbank, had you not? SCHACHT: Yes. I was only a minister without portfolio. MR. JUSTICE JACKSON: "So that the German banks in the occupied western territories need not work side-by-side, or rather against each other, you had assigned the Deutsche Bank the task of clearing the way for closer economic cooperation with Holland; and you entrusted the Dresdner Bank with the same task for Belgium." And you go on to describe that situation and say: "In order to remove this difficulty, you, Herr Reich Minister, have agreed that the undersigned comply with the requests of both banking houses for a decisive expression of opinion in 579 2 May 46 this question. I have subsequently discussed the situation with both banks and it was confirmed in the course of the conversation that at present there is no tendency on the part of Dutch or Belgian financial institutions to enter into general ties with the German business men." Do you recall? SCHACHT: Yes, I remember it, now that you have read it to me. May I make a statement, or what was your question? MR. JUSTICE JACKSON: I just wondered if you remembered that. SCHACHT: Yes, and I ask permission to make a statement. It concerns . . . MR. JUSTICE JACKSON: If you think it needs explaining . . . SCHACHT: I would think so; but I leave that to the Tribunal. If I may speak: It concerns a rivalry between two large banks. Both these large banks approached me-as a former banker and President of the Reichsbank-to decide the matter, and I did. I really do not see what that has to do with the official participation in the Belgian administration. MR. JUSTICE JACKSON: And the purpose of your intervention was to avoid misunderstanding in the occupied countries between the banking interests of the occupied countries and the German banks, was it not? SCHACHT: Certainly, they were to work together peacefully. MR. JUSTICE JACKSON: Yes. Although you have said to the Tribunal that you were entirely opposed to the Germans being in there at all? SCHACHT: Of course. But now that they were there I tried to keep peace. MR. JUSTICE JACKSON: You also were approached by Krupp von Bohlen about raising a fund known as the "Hitler spending fund," were you not? SCHACHT: No. MR. JUSTICE JACKSON: You never were? SCHACHT: Never. MR. JUSTICE JACKSON: Well, that is most unfortunate-that your name should be connected with... SCHACHT: Yes, I know the letter. MR. JUSTICE JACKSON: You never received such a letter? SCHACHT: Yes, I know the letter, but I was not assigned the task of raising that fund. 580 2 May 46 MR. JUSTICE JACKSON: Well, you assisted in raising it, didn't you? SCHACHT: No. MR. JUSTICE JACKSON: Did you contribute to it? SCHACHT: I personally, certainly not. I do not know what you are accusing me of. MR. JUSTICE JACKSON: I thought you knew about the letter from Von Bohlen. SCHACHT: Yes, but I ask you of what are you accusing me? Please tell me. MR. JUSTICE JACKSON: Did you raise any money or help to organize a loan with Krupp Von Bohlen in May of 1933-the Hitler spending fund? SCHACHT: No. MR. JUSTICE JACKSON: How did you answer Krupp van Bohlen's letter asking you to do so? SCHACHT: Would you please remind me of what Herr Von Krupp wrote to me at the time? MR. JUSTICE JACKSON: Have you the letter of the 29th of May? SCHACHT: Yes, one moment, please, I have nearly finished. May I reply now? From this. .. MR. JUSTICE JACKSON: First of all, did you receive such a letter? SCHACHT: Yes, of course. MR. JUSTICE JACKSON: All right. Tell us what happened. SCHACHT: In that letter Herr Von Krupp informed me that industry and other economic circles, such as agriculture, et cetera, intended to organize a joint Hitler fund in order to combine in one collection the unrestrained Party collections which were making the entire country insecure. He informed me of this, and also of the fact that a board of trustees was to be appointed for this Hitler fund. I want to say that I never joined thet board of trustees and was not a member of it. He further informed me that the representatives of the banks, Dr. Fischer and Dr. Mosler, would contact me and inform me about these things. That is all that the letter says. MR. JUSTICE JACKSON: That I offer as Exhibit Number USA-831, (Document Number D-151). [Turning to the defendant.] Will you look at the following letter of the 30th of May 1933, which says they had the opportunity of mentioning it to you? 581 2 May 46 SCHACHT: One moment, please. I do not think the letter is in my document book. No, it is not here. [The document was handed to the defendant. MR. JUSTICE JACKSON: I asked you to read the letter of the 29th of May first; one of the 29th of May and one of the 30th. The 29th of May has not been translated. SCHACHT: I see. Just a minute. I read. This letter never reached me. It has been crossed out and apparently it was not sent, because Krupp and I had a personal conversation to which Krupp refers in the letter of the following day, 30 May; the letter begins, "As Dr. Kottgen and I had the opportunity of mentioning to you yesterday.,." That apparently was a personal conversation. MR. JUSTICE JACKSON: Yes, and you had also said: "You were kind enough to promise me to obtain from Messrs. Otto Christian Fischer and Dr. Mosler. . . full particulars, and especially information on how far banks which are public corporations can participate in this task." SCHACHT: No, Mr. Justice Jackson, it does not say that in the letter. Please, will you be good enough to read the letter of 29 May? Where does it say that I spoke to Dr. Fischer, or would speak to Dr. Mosler? MR. JUSTICE JACKSON: Do you deny receiving the letter of the 29th? SCHACHT: Yes. MR. JUSTICE JACKSON: You never received it? SCHACHT: No. MR. JUSTICE JACKSON: Do you deny having a conversation with Krupp von Bohlen-Halbach, the substance of which is set forth in that letter? SCHACHT: No-One moment. Please, let me answer quietly. I do not wish to be accused of anything without replying. -I did not receive that letter on 29 May, nor did I receive it later. Instead, there was a personal conversation. The subject of that conversation is contained in the letter of 30 May, which we read before and which I received. You have just asserted that I had promised Krupp von Bohlen to speak to Dr. Fischer and Dr. Mosler. The letter makes no mention of that. MR. JUSTICE JACKSON: Does it not say so in the memorandum which you say was replaced by a conversation? That is what I am trying to ask you. 582 2 May 46 SCHACHT: At any rate, I did not promise to talk to the gentlemen. MR. JUSTICE JACKSON: Anything more you want to say? SCHACHT: No. That is enough. MR. JUSTICE JACKSON: Now, yesterday, I think it was, you testified that you had made public statements against the terror policy of the regime; and in evidence you quoted from your Konigsberg speech. SCHACHT: Yes. MR. JUSTICE JACKSON: Unfortunately, Dr. Schacht, you stopped just at the point where I got interested in it. SCHACHT: Yes, that is generally the case. MR. JUSTICE JACKSON: After you had stated that there are people who ran Germany-let me quote the part you quoted, because it is important in connection.. . SCHACHT: Quote the whole thing. MR. JUSTICE JACKSON: Yes. This is what you quoted: "Those are the people who heroically smear window panes in the middle of the night; who brand every German who trades in a Jewish store as a traitor; who condemn every former Freemason as a scoundrel, and who, in the just fight against priests and ministers who talk politics from the pulpit, cannot themselves distinguish between religion and misuse of the pulpit. The goal at which these people aim is generally correct and good." That is what you quoted? SCHACHT: Yes. MR. JUSTICE JACKSON: Now let us go on: "The goal at which these people aim is generally correct and good. There is no place in the Third Reich for secret societies, regardless of how harmless they are. The priests and ministers should take care of souls, and not meddle in politics. The Jews must realize that their influence is gone for all time." That was also a part of that speech, was it not? SCHACHT: Yes. MR. JUSTICE JACKSON: And you pointed out in that speech that on the Jewish problem, as you called it, legislation is being prepared and must be awaited? SCHACHT: Yes, I had hoped so. MR. JUSTICE JACKSON: You assured them so, did you not? 583 2 May 46 SCHACHT: I beg your pardon? Yes, that was the intention as I gathered from my conversation with Hitler. MR. JUSTICE JACKSON: And you knew that the laws on the Jewish subject were on their way? SCHACHT: Not the laws which were passed later. I always urged Hitler to give legal protection to the Jews. I wanted to see this law enacted, and I assumed that it would be done; but instead the Racial Laws of September or November, yes, November, 1935, were passed. MR. JUSTICE JACKSON: I have quoted from Exhibit Number USA-832, which is Document EC-433, and you say the laws you were forecasting and promising were laws for the protection of the Jews? SCHACHT: Yes. MR. JUSTICE JACKSON: We will get to that later. You gave your reasons, which you said were reasons of principle, to the Tribunal for not becoming a Party member? SCHACHT: Yes. MR. JUSTICE JACKSON: Yesterday in Court, do you recall that? SCHACHT: Yes. MR. JUSTICE JACKSON: Now isn't it a fact that you have told the United States Prosecution Staff that you asked Hitler whether to join the Party, and that to your great relief Hitler told you not to? SCHACHT- Yes. Before I co-operated with him I wanted to find out whether he demanded that I should become a member of the Party. I was most relieved when he Aid I need not. MR. JUSTICE JACKSON: So you remained out of the Party with Hitler's consent and approval? SCHACHT: Yes, of course. I think that is just another reason which will prove that I have never been a member of the Party. MR. JUSTICE JACKSON: But you did not mention that to the Tribunal when you were giving your reasons for setting out, that Hitler had given permission? SCHACHT: No, I thought the Tribunal would believe me anyway. MR. JUSTICE JACKSON: When you received the Party golden swastika, you stated that it was the greatest honor that could be conferred by the Third Reich, did you not? SCHACHT: I did, yes. 584 2 May 46 MR. JUSTICE JACKSON: And while you didn't wear it in your daily life, you did wear it on official occasions, you stated, did you not? SCHACHT: Yes. It was very convenient on railroad journeys, when ordering a car, et cetera. MR. JUSTICE JACKSON: From 1933 to 1942 you contributed a thousand Reichsmark a year to the Nazi Party? SCHACHT: No. Yes, I beg your pardon; from 1937 to 1942. MR. JUSTICE JACKSON: Didn't you say on interrogation that it was from 1933 to 1942? SCHACHT: No, that is an error. From 1937, after I had received the swastika. Evidently that is a misunderstanding. After I had received it I said to myself, '`It would be fitting-give the people a thousand marks a year, and have done with it." MR. JUSTICE JACKSON: For upwards of ten years, not quite ten years, you accepted and held office of one kind or another under this regime, did you not? SCHACHT: From 17 March 1933 to 21 January 1943. MR. JUSTICE JACKSON: And as I understand you, that during this time, at least a part of the time, Hitler deceived you, and all the time you deceived Hitler. SCHACHT: No, oh no. MR. JUSTICE JACKSON: I have misunderstood you? SCHACHT: Yes. - MR. JUSTICE JACKSON: Well now . . . SCHACHT: I believe that in the first years, at least, I did not deceive Hitler. I not only believe so, I know it. I only started to deceive him in 1938. Until then, I always told him my honest opinion. I did not cheat him at all, on the contrary... MR. JUSTICE JACKSON: What becomes, then, of your explanation that you entered his government in order to put brakes on his program? Did you tell him that? SCHACHT: Oh, no. I should hardly have done that or he would never have admitted me into the government. But I did not deceive him about it. MR. JUSTICE JACKSON: Did he know your purpose in joining his government was to defeat his program by sabotage? SCHACHT: I did not say that I wanted to defeat his program. I said that I wanted to direct it into orderly channels. 585 2 May 46 MR. JUSTICE JACKSON: Well, you have said that you wanted to put brakes on it. You used that expression. SCHACHT: Yes. MR. JUSTICE JACKSON: Which meant slow down? Didn't it? SCHACHT: Yes. MR. JUSTICE JACKSON: And he wanted to speed it up, isn't that right? SCHACHT: Yes, perhaps. MR. JUSTICE JACKSON: You never allowed him to know that you had entered his government for the purpose of slowing down his rearmament program, did you? SCHACHT: It was not necessary to tell him what I was thinking. I did not deceive him. I made no false statements, but I would hardly tell him what I actually thought and wanted. He did not tell me his innermost thoughts either, and you do not tell them to your political opponents either. I never deceived Hitler except after 1938. MR. JUSTICE JACKSON: I daresay. I am not asking you about a political opponent. I am asking you about the man in whose government you entered and became a part. SCHACHT: Yes. MR. JUSTICE JACKSON: You don't tell your opponents; but is it customary in Germany that members of the government enter for the purpose of defeating the head of the government's program? SCHACHT: I have already told you that the word defeat is incorrect. I did not intend to defeat him. I intended to slow him down; and that is indeed the custom, for that is how every coalition government is constructed. If you enter into a coalition government, you must discuss certain matters with your neighboring parties and come to an agreement about them, and you must use your influence to check certain projects of the other party. That is not a deception; it is an attempt at a compromise solution. MR. JUSTICE JACKSON: You claim you entered as a coalition? SCHACHT: Yes. I explained that in a distinct and comprehensive manner. MR. JUSTICE JACKSON: You used the word yourself today, in describing your activities, as sabotaging his rearmament program, did you not? SCHACHT: Yes, I did so, shall we say, after 1936. But he noticed it. That was not a deception. 586 2 May 46 MR. JUSTICE JACKSON: You take some part of the responsibility, I take it, for the loss of the war by Germany. SCHACHT: That is a very strange question. Please forgive me if I say that I assume no responsibility. Since I am not responsible for the fact that the war started I cannot assume any responsibility for the fact that it was lost. I did not want war. MR. JUSTICE JACKSON: And when did your doubts about Hitler as a man, his integrity, first arise? SCHACHT: I have explained that in such detail during the examination that I do not think I need repeat it. MR. JUSTICE JACKSON: Did that occur-I'll put it in the terms of your interrogation, since your interrogation is a little clearer. "In 1934"-so your interrogation runs-"he killed many people without having any legal justification or had them killed; and a few days after, in the Reichstag, he said he was the highest judge in Germany. He was certainly not, and for the first time I was shaken by his conception. It seemed to me absolutely immoral and inhuman." Is that correct? SCHACHT: I said that here yesterday or the day before; exactly the same thing. MR. JUSTICE JACKSON: Well, I want to fix these dates, Dr. Schacht. You see, your purpose in this trial and mine aren't exactly the same. SCHACHT: No, no, I know that. MR. JUSTICE JACKSON: Now, you also received full information about the operation of the Gestapo from Gisevius in 1934 or 1935, as he testified, did you not? SCHACHT: No, he did not say that. He said that he knew about these matters. He did not tell me everything, but I admitted earlier today-this morning-that he did inform me of certain things, and from that I drew my conclusions. At the beginning of May 1935 I had already discussed this matter with Hitler. MR. JUSTICE JACKSON: You were informed about the Gestapo terrorism, Reichstag Fire... SCHACHT: The Reichstag Fire? MR. JUSTICE JACKSON: . . .the falsity of the purge claim . . . SCHACHT: One moment, please. May I take them in order? I was not told about the Reichstag Fire until years later by the late Count Helldorf, who has been mentioned by Gisevius. 587 2 May 46 MR. JUSTICE JACKSON: You mean Gisevius never told you about that? SCHACHT: I think I heard it from Helldorf. I may have heard it from Gisevius, but I think it was Helldorf. At any rate, it was after 1935 that I heard about it. Until then, I did not think it was possible. MR. JUSTICE JACKSON: You never doubted Gisevius' word when he told you in 1934 or 1935 as he testified, did you? SCHACHT: One moment. He told me this either in 1934 or 1935, but not 1934 and 1935, and if he did tell me-well if Gisevius said so, I assume that it is true. MR. JUSTICE JACKSON: It was then that you knew about the persecution of the churches and the destruction of the labor unions, wasn't it? SCHACHT: The destruction of the labor unions took place as early as May 1933. MR. JUSTICE; JACKSON: You knew all about that, didn't you? SCHACHT: I did not know everything, only what was generally known. I knew exactly what every other German knew about it and what the labor unions themselves knew. MR. JUSTICE JACKSON: As a matter of fact, that was one of the reasons for the contributions by yourself and other industrialists to the Nazi Party, wasn't it? SCHACHT: Oh, no; oh, no. There was never any question of that. MR. JUSTICE JACKSON: You mean that meetings of industrialists were held, and as important a thing to industry as the destruction of the labor unions was never mentioned in your conferences? SCHACHT: I know nothing about it. Will you please remind me of something definite. MR. JUSTICE JACKSON: Confiscation of the properties; the putting of labor union leaders into concentration camps. SCHACHT: I heard about that-one moment. I do not know exactly who was put into the concentration camps. I was informed about the confiscation of property because that was publicly announced; but, if I understand you correctly, I do not know what the meetings of industrialists had to do with it. MR. JUSTICE JACKSON: Now, you also knew very early about the persecution of the Jews, didn't you? 588 2 May 46 SCHACHT: I explained yesterday exactly what I knew about the persecution of the Jews, how I acted in connection with the persecution of the Jews, and I state that as long as I was a minister I did everything to prevent these things. MR. JUSTICE JACKSON: I understood your generality, and I am trying to get at a little more detail about it, Dr. Schacht. Did you not testify as follows, on your interrogation on the 17th of October 1945: "The National Socialists, as I understood from the program, intended to have a smaller percentage of Jews in the governmental and cultural positions of Germany, with which I agreed." SCHACHT: Yes. MR. JUSTICE JACKSON: "Question: 'Well, now, you had read Mein Kampf, had you not?' "Answer: 'Yes.' "Question: 'And you knew the views of Hitler on the Jewish question. Did you not?' "Answer: 'Yes."' You so testified, did you not? SCHACHT: Yes. MR. JUSTICE JACKSON: "Question: 'Well, now, during your time as Reich Minister, statutes were passed, were they not, prohibiting all Jewish lawyers, for example, from practicing in the courts?' "Answer: 'Yes, that is what I said.' "Question: 'Did you agree with that?' "Answer: 'Yes.'" Did you say that? SCHACHT: Yes. MR. JUSTICE JACKSON: And you did agree with excluding . .. SCHACHT: Yes, I always agreed with that principle. MR. JUSTICE JACKSON: Yes. And you also agreed with the principle of excluding all Jews from civil service positions, did you not? SCHACHT: No. I want to emphasize in this connection... MR. JUSTICE JACKSON: Well . . . SCHACHT: May I finish? MR. JUSTICE JACKSON: Yes. 589 2 May 46 SCHACHT: With regard to the principle of the dominating Jewish influence in government, legal, and cultural questions I have always said that I did not consider this influence to be of advantage either to the German people and Germany, which was a Christian state and based on Christian conceptions, or to the Jews, since it increased the animosity against them. For these reasons I was always in favor of limiting Jewish participation in those fields, not actually according to the population, but nevertheless limiting them to a certain percentage. MR. JUSTICE JACKSON: Well, let's go on with the interrogation. The interrogations are always so much briefer than the answers made in court where the press is present, if I may say so. Did you not give these answers: "Question: 'Now, with respect to civil service. There was this Aryan clause that was put in. Did you agree with that legislation?' "Answer: 'With the same limitation.' "Question: 'Now, did you ever express yourself in the Cabinet or elsewhere to the point that you wanted these restrictions put in, restrictions you have been talking about?' "Answer: 'I don't think so; useless to do it.' "Question: 'You say "useless to do it?"' "Answer: 'Yes.' "Question: 'I thought you said at one time or another that the reason you stayed in is because you thought you might have some influence on policy.' "Answer: 'Yes.' "Question: 'You didn't consider this as important enough a matter to take a position on it?' "Answer: 'Not an important enough matter to risk a break.' " SCHACHT: To break, that is right. MR. JUSTICE JACKSON: Then, you were asked this: "You certainly signed a law with respect to the prohibition of Jews receiving licenses to deal in foreign currencies." Do you remember that? SCHACHT: Yes. MR. JUSTICE JACKSON: "Answer: 'Yes, maybe.' "Question: 'You were in favor of that?' "Answer: 'I don't remember the details-of that question.' "Question 'Well, it is not a matter of details. The question is a matter of discrimination.' 590 2 May 46 "Answer: Yes.' " You said that? SCHACHT: Yes, certainly. MR. JUSTICE JACKSON: You were in favor of that legislation, or were you not? SCHACHT: Is that the question now, or from the interrogation? MR. JUSTICE JACKSON: I am asking you now. SCHACHT: Yes. I agreed to it, Yes. MR. JUSTICE JACKSON: You were in favor of it. Well, you were not when you were interrogated. SCHACHT: You can see how difficult it is. MR. JUSTICE JACKSON: The question then was, you were in favor of it, and you said: "I wasn't in favor, but I had to sign it. "Question: 'Well, you were the only one who signed it. You were the Reich Minister of Economics?' "Answer: 'Yes.' "Question: 'And, obviously, it was a bill which was put in by your Ministry, was it not?' "Answer: 'Yes."' Is that correct? SCHACHT: Yes, I assume so. You see, in these matters it was a question of degrees. I have just explained the principles of my policy. The extent to which these individual laws went is a question of politics. Today, you can say what you like about it. MR. JUSTICE JACKSON: Now, you also favored the law, and signed the law, prohibiting all Jews from being admitted to examinations for public economic advisors, for co-operatives, for example. SCHACHT: Yes, possibly. I do not remember but probably it is right. MR. JUSTICE JACKSON: And you also approved a law imposing the death penalty on German subjects who transferred German property abroad, or left German property abroad. SCHACHT: Yes. MR. JUSTICE JACKSON: And of course you knew that that affected, chiefly and most seriously, the Jews who were moving abroad. SCHACHT: I hope that the Jews did not cheat any more than the Christians. 591 2 May 46 MR. JUSTICE JACKSON: Well, the death penalty on German subjects for transferring German property abroad was your idea of a just law? SCHACHT: I do not understand. My idea? MR. JUSTICE JACKSON: Yes. SCHACHT: It was an idea of the Minister of Finance, and I signed it. MR. JUSTICE JACKSON: Now, the question was then asked you after these were recited: "Well, now, was there a matter of conscience involved, or was there not?" And you answered: "To some extent, yes, but not important enough to risk a break." SCHACHT: Yes. MR. JUSTICE JACKSON: And the question: "Yes. In other words, you had quite another objective which was more important?" SCHACHT: Yes. MR. JUSTICE JACKSON: "Well what was that objective, Dr. Schacht?" I am still reading. It saves time. SCHACHT: Oh, pardon me. MR. JUSTICE JACKSON: "Answer: 'Well, the objective was to stay in power and to help carry this through in an ordinary and reasonable way.' "Question: 'That is to say, the restoration of the German economy?' "Answer: 'Quite.' "Question: 'And the completion of the armament program?' "Answer: 'The completion of the international equality, the political equality of Germany.' "Question: 'By means of armament, as you yourself have said?' "Answer: 'Also by means of armament."' SCHACHT: All correct, and I stand by that today. MR. JUSTICE JACKSON: Yes. So the armament question was so important that you didn't want to risk any break about the Jews. 592 2 May 46 SCHACHT: Not the armament question, but the equality of Germany. MR. JUSTICE JACKSON: Well, now, I just asked you "by means of armament, as you yourself have said." SCHACHT: And I say, also by means of armament. That is one of the means. MR. JUSTICE JACKSON: And it is the only one that was used ultimately, wasn't it? SCHACHT: No, it was not. There were other ones. MR. JUSTICE JACKSON: We will get to that in time. Now, isn't it a fact that you also approved the law dismissing all Jewish officials and notaries public? SCHACHT: That is possible. MR. JUSTICE JACKSON: And you wrote to Blomberg on the 24th of December 1935 giving your motives, did you not, saying this: "The economic and illegal treatment of the Jews, the anti-Church movement of certain Party organizations, and the lawlessness which centers in the Gestapo are a detriment to our rearmament task which could be considerably lessened through the application of more respectable methods, without abandoning the goals in the least." (Exhibit Number Schacht-13). You wrote that, did you not? SCHACHT: Yes. I quoted it myself yesterday. MR. JUSTICE JACKSON: Now, as to the rearmament program, you participated in that from three separate offices, did you not? SCHACHT: I do not know which offices you mean, but please go ahead. MR. JUSTICE JACKSON: I will help you to list them. In the first place, you were Plenipotentiary for War. SCHACHT: Yes. MR. JUSTICE JACKSON: That was the secret of lice at first. SCHACHT: Yes. MR. JUSTICE JACKSON: You were President of the Reichsbank. That was the financial office. SCHACHT: Yes. MR. JUSTICE JACKSON: And you were Minister of Economics, in which position you had control with the minister for the general economic situation. 593 2 May 46 SCHACHT: Yes. This word "control" is such a general term that I cannot confirm your statement without question, but I was Minister of Economics. MR. JUSTICE JACKSON: Now, let us take up first this position of Plenipotentiary for War. You have testified that this position was created for two purposes: (a) Preparation for war. (b) Control of the economy in event of war. Is that correct? SCHACHT: That means preliminary planning in case war should come, and the direction of economy when war had broken out. In other words, a preparatory period and a later period in the event of war. MR. JUSTICE JACKSON: And, you were asked about your functions and gave these answers, did you not, "As the Chief of Staff provides for mobilization from a military point of view... so you were concerned with it from the economic point of view." SCHACHT: Yes. MR. JUSTICE JACKSON: You answered, "certainly." And your position as Plenipotentiary for War was of equal rank with the War Ministry, was it not? SCHACHT: Yes. MR. JUSTICE JACKSON: And, as you told us, those charged with responsibility in event of war were: First, the Minister of War and the Chief of the General Staff of the Wehrmacht; and, secondly, on an equal footing, Dr. Schacht, as Plenipotentiary for Economics. Is that correct? SCHACHT: I assume so, yes. MR. JUSTICE JACKSON: And in January of 1937 you wrote this, did you not? "I am entrusted with the preparation of the war economy according to the principle that our economic war organization must be so organized in time of peace that the war economy can be directly converted in case of emergency from this peacetime organization and need not be created at the outbreak of war." SCHACHT: I assume that that is correct. MR. JUSTICE JACKSON: And who was your Deputy in that office? Wohlthat? SCHACHT: I think Wohlthat., MR. JUSTICE JACKSON: Now, those being your functions as Plenipotentiary for the War Economy, let's turn to your functions as President of the Reichsbank. 594 2 May 46 You said that the carrying out of the armament program was the principal task of the German policy in 1935, did you not? SCHACHT: Undoubtedly. MR. JUSTICE JACKSON: There is no doubt that you voluntarily assumed the responsibility for finding financial and economic means for doing that thing. SCHACHT: No doubt. MR. JUSTICE JACKSON: And you were the financial and economic administrator in charge of developing the armament industry of Germany. SCHACHT: No. MR. JUSTICE JACKSON: You were not? SCHACHT: No, in no way. MR. JUSTICE JACKSON: Well, I may have misunderstood you. "Question: 'Now, in connection with this development"'-I am referring to your interrogation of the 16th of October 1945, Exhibit USA-636 (Document Number 3728-PS), Page 44- "'Now in connection with this development of the armament industry, you charged yourself as the financial and economic administrator of it.' "Nodding your head." SCHACHT: I beg your pardon? MR. JUSTICE JACKSON: Nodding your head. SCHACHT: Yes MR. JUSTICE JACKSON: "You charged yourself"-I will ask the whole question so you will get it. SCHACHT: Yes. MR. JUSTICE JACKSON: "Now, in connection with this development of the armament industry, you charged yourself as the financial and economic administrator of it." The record says that you nodded your head. The next question was: "And in that connection you took various steps. Would you be good enough to describe for us the larger steps which you took with reference to this goal of rearmament, first, internally, and, second, with respect to foreign nations? "Answer: 'Internally, I tried to collect all money available for financing the mefo bills. Externally, I tried to maintain foreign commerce as much as possible.' " Did you make those answers, and are they correct? 595 2 May 46 SCHACHT: I am sure that you are correct. MR. JUSTICE JACKSON: And your purpose in maintaining foreign trade was to obtain enough foreign exchange to permit the imports of raw materials, not manufactured, which were required for the rearmament program. Is that not correct? SCHACHT: That is the question that is put to me. Now comes the answer. Please, will you read the answer? MR. JUSTICE JACKSON: What is your answer now? SCHACHT: My answer today is that that was not the only aim MR. JUSTICE JACKSON: Not the only aim? SCHACHT: Right. MR. JUSTICE JACKSON: But that was the primary aim, was it not? SCHACHT: No, not at all. MR. JUSTICE JACKSON: All right, what was the other aim? SCHACHT: To keep Germany alive, to assure employment for Germany, to obtain sufficient food for Germany. MR. JUSTICE JACKSON: Which was your dominant aim? SCHACHT: The food supply in Germany and work for the export industry. MR. JUSTICE JACKSON: Well, I should like to go over one or two of these documents with you as to your aim. I refer to Document 1168-PS of May 3, 1935. SCHACHT: Yes. MR. JUSTICE JACKSON: Title, "Financing of Armament," Exhibit Number USA-37. "The following comments are based on the assumption that the completion of the armament program in regard to speed and extent is the task of German policy and that accordingly everything else must be subordinated to this aim, insofar as this main goal is not endangered, by neglecting other questions." Did you write that? SCHACHT: Not only did I write it, but I handed it to Hitler personally. It is one of twin documents, one of which has already been submitted in evidence and discussed in detail by the Prosecution. I did not receive the second document. When my defense counsel examined me I stated here that I was intent on stopping the Party collections and Party moneys, which 596 2 May 46 were extracted everywhere from the German people, because I was extremely difficult for me to get the money to finance the armament program and the mefo bills. I could only get that point across to Hitler if I told him the of course this was being done in the interests of armament. I had told him that this was done... MR. JUSTICE JACKSON: Yes, but . . . SCHACHT: No, please let me finish. If I had told him that thin was done for the building of theaters, or something similar, I would have made no impression on him. However, if I said i must be done because otherwise we could not arm, that was point which influenced Hitler and that is why I said it. I admitted that and explained it during the examination by my attorney. MR. JUSTICE JACKSON: And you didn't call that misleading him? SCHACHT: I would not call it "misleading"; I would call it "leading."' MR. JUSTICE JACKSON: But leading without telling him the true motives which actuated you, at least. SCHACHT: I think you can be much more successful in leading a person if you do not tell him the truth than if you do tell bin the truth. MR. JUSTICE JACKSON: I am very glad to have that frank statement of your philosophy, Dr. Schacht. I am greatly indebted to you. Well, you devised all kinds of plans, one for the control of foreign exchange, blocked foreign accounts; and mefo bills we. one of the principal ones of your devices for financing was it not SCHACHT: Yes. MR. JUSTICE JACKSON: Now, I don't care about the details of mefo bills, but I would like to ask you this. Isn't it correct, al you testified in the inquiry of the 16th of October 1945-Exhibit Number USA-636-as follows: "Question: 'Actually, as a matter of fact, let me ask you this. At the time when you started the mefo bills, for example, there were no ready means available for financing the rearmament?' "Answer: 'Quite.' "Question: 'That is to say, through normal budget finance methods?' "Answer: 'Not enough.' 597 2 May 46 "Question: 'Also, you were limited at that time by the statute of the Reichsbank which did not permit you to give anything near the sufficient credit which was required by the armament program.' "Answer: 'Quite.' "Question: 'And you found a way?' "Answer: 'Yes.' "Question: 'And the way you found was by creating a device in effect which enabled the Reichsbank to lend, by a subterfuge, to the Government what it normally or legally could not do?' "Answer: 'Right.' " Is that true? SCHACHT: That was my answer. MR. JUSTICE JACKSON: The following questions were then asked: "I understand that basically what was built up in Germany in the way of an armament industry, a domestic economy that was sound, and a Wehrmacht, the efforts that you put in from 1934 to the spring of 1938, when mefo financing stopped, were responsible in large part for the success of the whole program. "Answer: 'I don't know whether they were responsible for it, but I helped a great deal to achieve that.' " SCHACHT: Yes. MR. JUSTICE JACKSON: And you were asked as follows, on the 17th of October 1945: "In other words, in effect you are not taking the position that you are not largely responsible for the rearming of the German Army? "Answer: 'Oh no, I never did that.' "Question: 'You have always been proud of that fact, I take it.' "Answer: 'I wouldn't say proud, but satisfied." Is that still your position? SCHACHT: In reply to that I should like to say: The question of mefo bills was quite certainly a system of finance which normally would never have been attempted. I made a detailed statement on this subject when I was questioned by my attorney. On the other hand, however, I can say that this question was examined by all legal experts in the Reichsbank and by means of this 598 2 May 46 subterfuge, as you put it, a way was found which was legally possible. MR. JUSTICE JACKSON: No, I didn't put it that way; you said so. SCHACHT: No, no. I mean the sentence you have just quoted as being my answer. I beg your pardon. The matter was investigated from' a legal viewpoint, and we assured ourselves that it could be done in this way. Moreover, I am still satisfied today that I contributed to the rearmament, but I wish that Hitler had made different use of it. MR. JUSTICE JACKSON: Well, on your 60th birthday Minister of War Blomberg said that, "Without your help, my dear Mr. Schacht, there could have been no rearmament," did he not? SCHACHT: Yes, those are the sort of pleasantries which one exchanges on such occasions. But there is quite a bit of truth. in it. I have never denied it. MR. JUSTICE JACKSON: That is the way it looks to me. Now, when you finally made some suggestion that the armament should stop or slow up, as I understand, you made that suggestion without knowing what the armament was. SCHACHT: Yes. MR. JUSTICE JACKSON: The only thing you were judging by was financial conditions, was it not? SCHACHT: Oh, no. MR. JUSTICE JACKSON. Well, what was it? SCHACHT: I did, of course, have a general impression of these matters because General Thomas always discussed them with me. However, I do not remember that General Von Blomberg gave me detailed information about what he thought. Of course, I was informed in a general way regarding the progress made by the armament program, and that is why I said "more slowly." My opinion was strengthened because of the general conditions. MR. JUSTICE JACKSON: Well now, let's see what reasons you gave in Document Number EC-286. That is Exhibit Number [TSA-833: "I am therefore of the opinion that we should promote our export with all resources by a temporary"-and I emphasize the word "temporary"-"decrease of armament." SCHACHT: Decrease? MR. JUSTICE JACKSON: Decrease, yes, temporary. 599 2 May 46 SCHACHT: Yes. MR. JUSTICE JACKSON: I emphasize "temporary," and you emphasize "decrease." SCHACHT: Oh no, no; I agree with you. MR. JUSTICE JACKSON: "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 oil-fuel program, the buna program, and the program of developing ore resources, insofar as this development does not of itself require large amounts of raw materials 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 convinced that by such a policy our export could be increased so greatly that there would be a certain improvement in our exhausted stocks, and that the resumption of the strengthened armament would again be possible in the not too distant future, from the point of view of raw materials. I am unable to judge to what extent a temporary postponement of armament would have military advantages. However, I presume 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 also afford an opportunity to survey the technical results of previous armament and to perfect the technical aspect of armament." Now that you addressed to Goering, did you not? SCHACHT: That is perfectly possible. I cannot remember the letter, but it looks quite like one of mine. MR. JUSTICE JACKSON: Yes; and you were correctly giving to Goering your true views; were you not? SCHACHT: No; I believe that this was merely a tactical letter. I think that I was mainly trying to limit armament. If I had told him that we wanted to stop arming, Goering would probably have denounced me to the Fuehrer accordingly. Therefore I told him, "Let's stop for the time being"-temporary. I also emphasize "temporary." It was a tactical measure to convince Goering that for the time being it should be temporary. MR. JUSTICE JACKSON: Then, with your fellow officers in the Government you were also using tactical statements which did not represent your true views? SCHACHT: That was absolutely necessary. 600 2 May 46 MR. JUSTICE JACKSON: When did it cease to be necessary, Dr. Schacht? SCHACHT: Cease? MR. JUSTICE JACKSON: Yes; when did it cease to be necessary? SCHACHT: I think it more important to ask when it commenced; when it started. MR. JUSTICE JACKSON: Well? SCHACHT: During the first years I did not do it, of course, but later on I did to a considerable extent. I could say always; it never stopped. MR. JUSTICE JACKSON: Has it stopped now? SCHACHT: I have no more colleagues, and here before this Tribunal I have nothing to tell but the truth. MR. JUSTICE JACKSON: Well, on the 24th of September, 1935-December-you wrote EC-293, which is Exhibit Number USA-834, and used this language, did you not: "If there is now a demand for greater armament, it is, of course, not my intention to deny or change my attitude, which is in favor of the greatest possible armament and which I have 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." SCHACHT: That is very good. MR. JUSTICE JACKSON: And that is true? SCHACHT: Certainly. MR. JUSTICE JACKSON: Now, there came in the Four Year Plan in 1936? SCHACHT: Yes. MR. JUSTICE JACKSON: You did not like the appointment of Goering to that position? SCHACHT: I thought he was unsuited and, of course, it made an opening for a policy which was opposed to mine. I knew perfectly well that this was the start of exaggerated armament, whereas I was in favor of restricted rearmament. MR. JUSTICE JACKSON: 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? 601 2 May 46 SCHACHT: Oh yes. MR. JUSTICE JACKSON: Well, will you do it? SCHACHT: Yes, I think if you read the record of the so-called "small Ministerial Council," of the year 1936, and in particular 1938, which you yourself introduced, you will see at once that here the necessity of increased armament was emphasized. For instance, those of November or October 1936, I think. MR. JUSTICE JACKSON: Well, it was also emphasized in your documents, was it not, throughout? SCHACHT: No. MR. JUSTICE JACKSON: You say that your statements of that sort were merely tactical. SCHACHT: No, I beg your pardon. I said arm within the limits of what is economically possible and reasonable. Goering, if I may say it again, wanted to go beyond those limits. MR. JUSTICE JACKSON: 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? SCHACHT: No. I said that the most important thing was that Germany should live and have foreign trade, and within those limits we could arm. However, it is out of the question that Germany should arm for the sake of arming, and thus ruin her economy. MR. JUSTICE JACKSON: Well that's the difference between you and Goering; it was over what the economy would stand, was it not? SCHACHT: No, it was a question of the extent of rearmament. The point is, Mr. Justice Jackson, that German economy paid the price for Goering's action. The only question is, was it reasonable or unreasonable? If I may state it pointedly, I would say that I considered Goering's economic policy to be unreasonable and a burden to the German nation; while I considered it most important that rearmament should not be extended and that the German nation should have a normal, peacetime standard. THE PRESIDENT: The Tribunal will adjourn. [The Tribunal adjourned until 3 May 1946 at 1000 hours.] 602