dtufail/nuremberg-trials-corpus huggingface dataset:
MR. DODD: On May 31st of 1935-as stated earlier in this morning's discussion-the Defendant Schacht was secretly appointed plenipotentiary-general of the war economy, and he had the express function of placing all economic forces of the nation in the services of the Nazi war machine. By the secret defense law of May 21, 1935, under which Schacht received this secret appointment, he was in effect, given charge of the entire war economy. In case of war, he was to be virtual economic dictator of Germany. His task was to place all economic forces into the service for the conduct of the war and to secure economically the life of the German people. The Ministers of Economy, of Food, Agriculture, Labor, Forestry, as well as all Reich agencies directly under the Fuehrer, were subordinated to him. He was to be responsible for the financing as well as for the conduct of the war; and he was even authorized to issue ordinances within his sphere of responsibility, even if these deviated from the existing laws. The rearmament of Germany proceeded at an amazingly rapid pace. By the summer of 1935, the Nazi conspirators were emboldened to make plans for the reoccupation of the Rhineland; and at the tenth meeting of this same working committee of the Council, the question of measures to be taken in connection with the proposed reoccupation of the Rhineland were discussed. I refer to the document bearing the number EC-405. At that meeting, held on the 26th day of June 1935, it was said that the Rhineland required special treatment, because of the assurances given by Hitler to the French that no military action was being undertaken in the de-militarized zone. Among the matters requiring special treatment was the preparation of economic mobilization, a task specifically entrusted to the Defendant Schacht, as secret Plenipotentiary for the War Economy.
THE PRESIDENT: Are you reading from this document?
MR. DODD: I am quoting in part from it, Your Honor, and it is upon the document that I base my statements white can be found therein on Pages 4 and 5. I dislike annoying the Court with constant references to these documents, but I thought it would be the best way to proceed so as fully to inform the Court.
THE PRESIDENT: Well if you tell us where it is in the document we can follow it in the document.
MR. DODD: On Page 4, the middle of the page, the fifth paragraph, the first sentence: "The de-militarized zone requires special treatment." And on Page 5, (j), under "the preparations," "Preparation of economic mobilization." On Page 4, the last paragraph just before the setting-out of the (a), (b), (c), and (d), it is said . . .
THE PRESIDENT: I think you ought to read on Page 4, the last paragraph but one: "Since political entanglements . . ."
MR. DODD: "Since political entanglements abroad must be avoided at present under all circumstances . . . only those preparatory measures that are urgently necessary may be carried out. The existence of such preparations, or the intention of them must be kept in strictest secrecy in the zone itself as well as in the rest of the Reich." The preparations are then set out, and they include, as I have indicated a few minutes ago, as the last one in the list, the preparations for economic mobilization. There are many others, of course. The preliminary mustering of horse-drawn and motor vehicles, preparation for evacuation measures, and so forth. We say-passing now from that document- we say the rapid success of the German re-armament is attributable to the greatest extent to the work of the Defendant Schacht. In the fall of 1934, the Nazi conspirators announced the so-called "New Plan," aiming at the control of imports and exports in order to obtain the raw materials which were needed for armaments and the foreign currency which was required to sustain the armament program. This new plan was the creation of the Defendant Schacht, and under the plan, the Defendant Schacht controlled imports by extending the system of supervisory boards for import control, which was previously limited to the main groups of raw materials, to all goods imported into Germany, whether raw materials, semimanufactured goods, or finished products. The requirement of licenses for imports enabled the Nazi conspirators to restrict imports to those commodities which served their war aims. Subsequently, in February of 1935, the "Devised" Law was passed which can be found by reference in the Reichsgesetzblatt of 1935, Part I, Page 105; and under it, all transactions involving foreign exchange were subject to the approval of Devisenstellen (the Foreign Exchange Control Offices). By thus controlling the disposition of foreign exchange, the conspirators were able to manipulate foreign trade so as to serve their needs and desires.
MR. DODD: Thus every aspect of the German economy was being geared to war under the guidance particularly of the Defendant Schacht. In a study of the economic mobilization for war as of 30 September 1934, it was stated that steps had already been taken to build up stock piles, to construct new facilities for the production of scarce goods, and to redeploy industry, to secure areas and to control fiscal and trade policies. References were made to the fact that the task of stock piling had been hampered by the requirement of secrecy and camouflage. Reserves of automobile fuels and stocks of coal were being accumulated and the production of synthetic oil was accelerated. Civilian supply was purposely organized so that most plants would be working for the German Armed Forces. Studies were made of the possibility of barter trade with supposedly neutral countries in case of war. The matter of financing the armament program presented a difficult problem for the conspirators. In 1934 and 1935 the German economy could by no possibility have raised funds for their exten- sive rearmament program through taxes and public loans. From the outset, the armament program involved "the engagement of the last reserves." Apart from the problem of raising the huge sums required to sustain this program, the Nazi conspirators were exceedingly anxious, in the early stages, to conceal the extent of their feverish armament activities. After considering various techniques of financing the armament program, the Defendant Schacht proposed the use of so-called "mefo" bills. One of the primary advantages of this method was the fact that figures indicating the extent of rearmament that would have become public through the use of other methods could be kept secret through the use of mefo bills, and mefo bills were used exclusively for armament financing. Transactions in mefo bills worked as follows: Mefo bills were drawn by armament contractors and accepted by a limited liability company, [The Metallurgische Forschungsgesellschaft m. b.
MR. DODD: H.] , the initials of which spell mefo from whence the transaction takes its name. This company had a nominal capital of 1 million Reichsmarks and was therefore merely a dummy organization. The bills were received by all German banks for possible rediscounting with the Reichsbank, and the bills were guaranteed by the Reich. Their secrecy was assured by the fact that they appeared neither in the published statements of the Reichsbank nor in the budget figures. The mefo bill system continued to be used until April 1 of 1938. To that date, 12 billion Reichsmarks of mefo bills for the financing of rearmament had been issued. Since it was no longer deemed necessary in April of 1938 to conceal the vast progress of German rearmament, mefo financing was discontinued at that time. A further source of funds which the Defendant Schacht drew upon to finance the Secret Armament Program were the funds of political opponents of the Nazi regime, and marks of foreigners on deposit in the Reichsbank. As Schacht stated-and I am quoting: "Our armaments are also financed partly with the credits of our political opponents." That statement may be found in a memorandum from the Defendant Schacht to Hitler, dated 3 May 1935, and it bears the number in the document book of 1168-PS, and the specific sentence is found in the second paragraph. The outstanding mefo bills at all times represented a threat to the stability of the currency because they could be tendered to the Reichsbank for discount, in which case the currency circulation would automatically have to be increased. Thus, there was an ever-present threat of inflation. The Defendant Schacht continued on his course, because he stands, he said, "with unswerving loyalty to the Fuehrer because he fully recognizes the basic ideas of National Socialism and because at the end, the disturbances, compared to the great task, can be considered irrelevant." High-ranking military officers paid tribute to the Defendant Schacht's contrivances on behalf of the Nazi war machine.
MR. DODD: In an article written for the Military Weekly Gazette in January of 1937, it is said: "The German Defense Force commemorates Dr. Schacht today as one of the men who have done imperishable things for it and its development in accordance with the directions from the Fuehrer and Reich Chancellor. The Defense Force owes it to Schacht's skill and great ability that, in defiance of all currency difficulties, it, according to plan, has been able to grow up to its present strength from an army of 100,000 men." After the reoccupation of the Rhineland, the Nazi conspirators re-doubled their efforts to prepare Germany for a major war. The Four Year Plan, as we have indicated earlier, was proclaimed by Hitler in his address at the Nuremberg Party convention on the 9th day of September in 1936, and it was given a statutory foundation by the decree concerning the execution of the Four Year Plan dated the 18th day of October, 1936, which is found in the Reichsgesetzblatt of 1936, in the first part, on Page 887. By this decree the Defendant Goering was put in charge of the plan. He was authorized to enact any legal and administrative measures deemed necessary by him for the accomplishment of his task, and to issue orders and instructions to all Government agencies, including the highest Reich authorities. The purpose of the plan was to enable Nazi Germany to attain complete self-sufficiency in essential raw materials, notably motor fuel, rubber, textile fiber, and non-ferrous metals, and to intensify preparations for war. The development of synthetic products was greatly accelerated despite their high costs. Apart from the self-sufficiency program, however, the Nazi conspirators required foreign exchange to finance propaganda and espionage activities abroad.
MR. DODD: Thus, in a speech on November 1 of 1937, before the Wehrmachtakademie, General Thomas stated: "If you consider that one will need during the war considerable means in order to organize the necessary propaganda in order to pay for the espionage service and for similar purposes, then one should be clear that our internal mark would be of no use therefore, and that foreign exchange will be needed." This particular need for foreign exchange was reduced in part by the virtue of the espionage and propaganda services rendered free of charge to the Nazi State by some leading German industrial concerns. I hold in my hand a document bearing the number D-206. It is dated at Essen the 12th day of October 1935. It was found in the files of the Krupp Company by representatives of the United States and the British armies. I shall not read all of it unless Your Honors require it, but I'll start at the beginning by way of establishing its purpose and the information contained therein. It is entitled "Memorandum." There is a subheading: "Concerns: Distribution of official propaganda literature abroad with the help of our foreign connections." It goes on to say that: "On the morning of October 11 the district representative of Ribbentrop's private foreign office (Dienststelle Ribbentrop) made an appointment for a conference by telephone."-and that-"A Mr. Lackmann arrived at the appointed time . . . 'In answer to my question with whom I was dealing, and which official bureau he represented, he informed me that he was not himself the district representative of Ribbentrop's private foreign office, that a Mr. Landrat Bollmann was such, and that he himself had come at Mr. Bollmann's order." The next paragraph states: ". . . that there exists a great mixup in the field of foreign propaganda, and that Ribbentrop's private foreign office wants to create a tighter organization for foreign propaganda. For this purpose the support of our firm and above all an index of addresses . . .
MR. DODD: were needed." In the next sentence, of the third paragraph, I would like to read: "I informed Mr. L that our firm had put itself years ago at the disposal of official bureaus for purposes of foreign propaganda, and that we had supported all requests addressed to us to the utmost." I now hold in my hand the document bearing the number D-167, which is also a copy of a document found in the files of the Krupp Company by representatives of the American and the British Armies. It is dated the 14th day of October 1937, and states that it is a memorandum of Herr Sonnenberg on the meeting at Essen on the 12th day of October 1937 and it indicates that one Menzel representing the intelligence of the Combined Services Ministry, his department coming under the Defense Office, asked for intelligence on foreign armaments, but not including matters published in newspapers, intelligence received by Krupp from their agents abroad and through other channels to be passed on to the Combined Services Intelligence. Finally, the third paragraph states that: "On our part we undertook to supply information to the Combined Services Ministry . . . as required." I have concluded reading from that document, and I pass now to discuss the conspirators' program, which proceeded, as I have said so many times here today, with amazing-really speed. The production of steel, for example, as shown in official German publications, rose as follows: In the year of 1933, 74,000 tons were produced; in 1934, 105,000 tons; 1935, 145,000 tons; 1936, 186,000 tons; 1937, 217,000 tons; and in 1938, 477,000 tons. The production of gasoline increased at even a greater tempo: from 370,000 tons in 1934 to 1,494,000 tons in 1938. The Nazi conspirators pressed the completion of the armament program with a sense of urgency which clearly indicated their awareness of the imminence of war.
MR. DODD: At a 4th of September meeting in 1936 Goering pointed out that "all measures have to be taken just as if we were actually in the state of imminent danger of war." He pointed out that "if war should break out tomorrow we would be forced to take measures from which we might. . . shy away at the present moment. They are therefore to be taken." The extreme urgency was manifested by Goering's remark that "Existing reserves will have to be touched for the purpose of carrying us over this difficulty until the goal ordered by the Fuehrer has been reached . . . in case of war," he added, "they are not a reliable backing in any case." By a letter marked "Top Secret", on the 21 of August of 1936, the Defendant Schacht was advised that Hitler had ordered that an formations of the Air Force be ready by April 1 of 1937. This served to accentuate the urgent sense of immediacy that had pervaded the Nazi war economy from the outset. Flushed with their successes in the Rhineland, the Nazi conspirators were laying the groundwork for further aggressive action.
THE PRESIDENT: Insofar as I understand you, you have not referred us to any document since Document 167.
MR. DODD: No, Your Honor, the figures on the production of steel and of oil are from the statistical year book for the German Reich of 1939 and 1940 and the statistical year book for the German Reich of 1941 and '42-that is, with respect to the steel figures. And the figures which I quoted with respect to the production of gasoline are from the statistical year book for the German Reich in 1941 and 1942. The statements of the Defendant Hitler are based upon the document marked EC-416, in the document book.
THE PRESIDENT: That is the document you have already referred to, isn't it?
MR. DODD: Yes, it has been referred to heretofore, I believe. Some of these documents contain references to more than one part of the presentation, and I have to refer to them at different times in the presentation...
THE PRESIDENT: All right. Go on, if you want to refer to it.
MR. DODD: The sixth paragraph on the first page: "Existing reserves will have to be touched for the purpose of carrying us over this difficulty until the goal ordered by the Fuehrer has been reached, and then in case of war, they are not a reliable backing in any case." And on the second page, the eighth paragraph down: "If war should break out tomorrow, we would be forced to take measures from which we might possibly still shy away at the present moment. They are therefore to be taken." With reference to the assertion that the Defendant Schacht was advised that Hitler had ordered that all formations of the Air Force be ready by April 1, 1937, I respectfully refer to Document 1301PS, dated 31 August 1936. I am advised that that document should bear an additional number. It should read 1301-PS-7. On the first page, if Your Honor pleases, the third paragraph, or the paragraph marked "3" and after the words "air force" . . . states that according to an order of the Fuehrer, the setting up of all Air Force units had to be completed on April 1, 1937; and if Your Honors will turn the page to Page 20, about midway in the page, you will observe that a copy of this document was sent to the president of the Reichsbank, Dr. Schacht. After their successes in Austria and in the Sudetenland, the Nazi conspirators redoubled their efforts to equip themselves for a war of aggression, and in a conference on October 14, 1938, shortly before the Nazi conspirators made their first demands on Poland, the Defendant Goering stated that the Fuehrer had instructed him to carry out a gigantic program, by comparison with which the performances thus far were insignificant. This faced difficulties which he would overcome with the greatest energy and ruthlessness.
MR. DODD: And that statement may be found in the Document 1301-PS, on Page 25 of that document, and particularly the second sentence of the opening paragraph: "Everybody knows from the press what the world situation looks like, and therefore the Fuehrer has issued an order to him to carry out a gigantic program compared to which previous achievements are insignificant. There are difficulties in the way which he will overcome with the utmost energy and ruthlessness." The supply of foreign currency had shrunk because of preparations for the invasion of Czechoslovakia, and it was considered necessary to replenish it. "These"-and I am now referring to the third paragraph of that same Page 25 of Document 1301-PS: "These gains made through the export are to be used for an increased armament. The armament should not be curtailed by the export activities. He received the order from the Fuehrer to increase the armament to an abnormal extent, the Air Force having first priority. Within the shortest time, the Air Force is to be increased fivefold; also the Navy should get on more rapidly, and the Army should procure large amounts of offensive weapons at a faster rate, particularly heavy artillery pieces and heavy tanks. Along with this manufactured armaments must go, especially fuel, powder and explosives are to be moved into the foreground. It should be coupled with the accelerated construction of highways, canals, and particularly of the railroads." In the course of these preparations for war, a clash of wills ensued between two men, the Defendant Goering and the Defendant Schacht, as a result of which the Defendant Schacht resigned his position as head of the Ministry of Economics and plenipotentiary for the war economy in November of 1937 and was removed from the presidency of the Reichsbank in January of 1939. I do not propose, at this moment, to go into the details of this controversy.
MR. DODD: There will be more said on that subject at a later stage in these proceedings, but for the present, I should like to have it noted that it is our contention that Schacht's departure in no way implied any disagreement with the major war aims of the Nazis. The Defendant Schacht took particular pride in his vast attainments in the financial and economic fields in aid of the Nazi war machine. And in the document bearing the number EC-257, which is a copy of a letter from the Defendant Schacht to (general Thomas, in the first paragraph of the letter: "I think back with much satisfaction to the work in the Ministry of Economics which afforded me the opportunity to assist in the rearmament of the German people in the most critical period, not only in the financial but also in the economic sphere. I have always considered a rearmament of the German people as conditio sine qua non of the establishment of a new German nation." The second paragraph is of a more personal nature and has no real bearing on the issues before us at this time. In the document labeled EC-252, a letter written to General Von Blomberg, dated the 8th day of July 1937, the Defendant Schacht wrote: "The direction of the war economy by the plenipotentiary would in that event never take place entirely independent from the rest of the war mechanism, but would be aimed at accomplishment of the political war purpose with the assistance of all economic forces. I am entirely willing therefore, to participate in this way in the preparation of the forthcoming order giving effect to the Defense Act." In the spring of 1937, the Defendant Schacht participated with representatives of the three branches of the Armed Forces in war games in war economy which was something new by way of military exercises. The war games in war economy were held at Godesberg, Germany. And I refer to the document bearing the label EC-174.
MR. DODD: It has as a heading, or subheading, under the summary: "War economy trip to Godesberg undertaken by General Staff between the 25th of May and the 2d of June," and it goes on to outline in some slight detail that there was a welcome to the General Staff war economy trip. It tells something in a rather vague and not altogether clear way of just how a war game in war economy was conducted but it leaves no doubt in the mind that sum a war game in war economy had been conducted at Godesberg at that time. And on the second page of this document, the last Paragraph is the translation of Part 1 of the speech welcoming Dr. Schacht. It says: "Before I start with the discussion of the war game in war economy, I have to express how grateful we all are that you, President Dr. Schacht, have gone to the trouble to personally participate in our final discussion today despite all your other activities. This proves to us your deep interest in war economy tasks shown at all times and your presence here is renewed proof that you are willing to facilitate for us soldiers the difficult war-economic preparations and to strengthen a harmonious cooperation with your offices." I should also like to call the Court's attention to the next to the last paragraph on the first page. It is a one-sentence paragraph, and it simply says, "I want to point out, however, that all material and all information received has to be kept in strict secrecy," and it refers to the preceding paragraph concerning the war games in war economy. It appears that the annexation of Austria was a goal which the Defendant Schacht had long sought, for in a speech to the employees of the former Austrian National Bank, as set out in the document bearing the label EC-297, and particularly the second paragraph of the first page of that document, nearly at the end, four or five lines from the end of that paragraph, we find these words immediately after "large applause".