The Nizkor Project: Remembering the Holocaust (Shoah)

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Q. How far did you personally participate in helping Hitler
to power? I continue this question: under what circumstances
and for what purpose did you, in February, 1933, organize a
meeting between Hitler and the industrialists? This subject
has already been mentioned before.

A. I did not help Hitler to come to power in any way. All
this has been discussed here at great length. In February,
1933, Hitler had already been in power some time. As to
finances and the industrial meetings of February, 1933, that
has profusely been gone into.

Q. What particular role did you play in this conference?

A. This, too, has been discussed in detail. Please refer to
it in the record.

Q. I have already familiarised myself with the reports, but
you have not explained events sufficiently clearly. In order
to shed some more light on the question, I shall refer to
defendant Funk's testimony of 4th June, 1945. This is
Document No. 2828-PS. I quote defendant Funk's testimony:

  "I was present at this conference and money was demanded,
  not by Goering, but by Schacht. Hitler left the room and
  Schacht made a speech in which he asked for money for the
  election campaign. I was present, present as an impartial
  witness, inasmuch as I enjoyed a close friendship with
  the industrialists."

Does this testimony of the defendant Funk represent the

A. Herr Funk is in error. Document D-203 has been presented
here to the Tribunal by the prosecution.

Q. But -

A. Please do not interrupt me. The prosecution has submitted
this document, and this document shows that Goering directed
the request for financial aid and not I.

Q. In this connection defendant Funk declared in advance
that this speech was made by you and not by Goering. I ask
you now, which statement represents the truth?


A. I have just told you that Herr Funk is in error and that
the evidence of the prosecution is correct.

Q. Then what part did you play in connection with this

A. This, too, I have already stated in detail.

Q. In quite sufficient detail -

THE PRESIDENT: The Tribunal has already heard a long cross-
examination, and it does not desire to hear the same facts
or matters repeated. Will you tell the Tribunal whether you
have any points which the Soviet Union are particularly
interested in, which have not been dealt with in cross-

GENERAL ALEXANDROV: Mr. President, in his statements the
defendant Schacht did not reply in sufficient detail, nor
were his answers sufficiently clear. I am therefore obliged,
in certain instances, to refer to these questions again. It
is, in particular, not clear to us, what part the defendant
Schacht played in this meeting of the industrialists. It
appears to me that defendant Schacht did not give a
sufficiently clear or well-defined reply to the question
which I had asked him. As for the other questions, they are
few in number and I imagine that after the recess I can try
and finish with them in about thirty or forty minutes. All
these questions are of interest to us since they enable us
to determine the guilt of the defendant Schacht.

THE PRESIDENT: Very well. The Tribunal is not prepared to
listen to questions which have already been put.

GENERAL ALEXANDROV: Perhaps now you will find it desirable
to declare a recess, in order to continue the cross-
examination after the recess.

THE PRESIDENT: No, General Alexandrov, the cross-examination
will continue up to the recess.

Q. Do you admit that while acting as President of the
Reichsbank, and Minister of Economics, and Military
Plenipotentiary for questions of War Economy, you played a
decisive part in preparing the rearmament of Germany and,
consequently, in preparing for a war of aggression?

A. No, I categorically deny that.

Q. You were General Plenipotentiary for questions of War

A. Well, we have spoken about that here many times already.

Q. I did not hear it from
your own lips, not once.

THE PRESIDENT: He has admitted throughout - and, of course,
it is obvious - that he was Plenipotentiary for War Economy;
but what you put to him was, whether he as Plenipotentiary
for War Economy took part in rearmament for aggressive war,
and he has said over and over again that that was not his
object, that his object was to gain equality for Germany. He
said so, and we have got to consider whether that is true.
But that he said it, is perfectly clear.

GENERAL ALEXANDROV: In my subsequent questions it will be
quite clear why I touch precisely on this question.

How long did you occupy the post of General Plenipotentiary
for War Economy?

A. I have just stated that I do not understand the question
- for what duration? All this has certainly been stated here

THE PRESIDENT: We have the date when he became
Plenipotentiary for War Economy and the date when he ceased
to be.

Q. I should like to remind you of the duties imposed on you
as General Plenipotentiary by the Reich Defence Act of 21
May, 1945. I shall quote a brief excerpt from Section 2 of
this law, entitled "Mobilisation":

  "Point I: For the purpose of directing the entire war
  economy the Fuehrer and Reich Chancellor will appoint a
  "General Plenipotentiary for War Economy".

                                                   [Page 74]

  "Point 2: It will be the duty of the General
  Plenipotentiary for War Economy to utilize all economic
  possibilities in the interest of the war, and to
  safeguard the economic well-being of the German people.
  "Point 3: Subordinate to him will be:
  the Reich Minister of Economics,
  the Reich Minister for Food and Agriculture,
  the Reich Labour Minister,
  the Reich Minister for Woods and Forests
  and all other Reich officials directly subordinate to the
  Fuehrer and Reich Chancellor.
  "Further, he shall be responsible for the financing of
  the war within the sphere of the Reich Finance Ministry
  and the Reichsbank.
  "Point 4: The General Plenipotentiary for War Economy
  shall have the right to enact public laws within his
  official jurisdiction which may differ from existing

You admit that this law gave you extraordinary powers in the
sphere of war economy?

A. This document is before the Tribunal and I assume that
you have read it correctly.

Q. I am not asking you whether I have read the document
correctly, I am asking you whether you admit that by this
law you were given extraordinary powers in the sphere of the
war economy?

A. I had exactly the full powers which are described in the

Q. Do you admit that these were not ordinary powers, but
special, extra-ordinary powers?

A. No, I will not admit that at all.

Q. In other words, you considered that the Reich Defence Law
of the 21st May, 1935, was just an ordinary law whose
function -

A. It was simply an ordinary law.

Q. And you also considered the functions imposed on you by
this law as General Plenipotentiary for War Economy ordinary

A. As very ordinary regulations which are customary with
every general staff.

THE PRESIDENT: The Tribunal will adjourn now.

(A recess was taken.)

THE PRESIDENT: Yes, General Alexandrov.

GENERAL ALEXANDROV: Mr. President, taking into consideration
the Tribunal's desire, as well as the fact that Mr. Jackson
has already questioned Schacht in detail, and having read
the minutes of this morning's session, it has been possible
for me to shorten considerably the number of questions in my
examination. I have only two to put to defendant Schacht.


Q. Defendant Schacht, on 21st May, 1935, the Reich
Government made a decision with regard to the Reich Defence
Council. The decision was as follows, citing Point I:
  "It is the will of the Fuehrer and Reich Chancellor that
  the Plenipotentiary General for War Economy shall take
  over this responsible directorate (Leitung), and is, as
  with the Reich War Minister, holder of the executive
  power, independent and responsible for his own sphere of
  activity to the Fuehrer and Reich Chancellor."

Do you admit that you carried through actively this decision
of the Reich Government; and that you took an active part in
Germany's economic preparations for aggressive war?

A. No, Sir, I definitely do not admit that.

                                                   [Page 75]

Q. On 4th March, 1935, in your speech at the Spring Fair in
Leipzig, you said the following, citing from Document USA-

  "My so-called foreign friends are doing neither me nor
  the cause a service, nor a service to themselves, when
  they try to bring me into conflict with the impossible,
  so they say, National Socialist theories, and present me,
  so to speak as the guardian of economic reason. I can
  assure you that everything I say and do is with the full
  consent of the Fuehrer, and I shall neither do nor say
  anything which he has not approved. Therefore, the
  guardian of economic reason is not I but the Fuehrer."

Do you confirm this speech you made at the Spring Fair in

A. I admit it and would like to make a statement.

I have said repeatedly, first, that my foreign friends, as
far as I had foreign friends, did not do me a service when
they said publicly that I was an adversary of Hitler,
because that made my position extremely dangerous. Secondly,
I said in that speech I would not do anything which would
not be according to my conviction, and that Hitler did
everything I suggested to him, that is, that it was his
opinion also. If I had said anything to the contrary, that
would have been expressed. I was in complete accord with him
so long as his policies agreed with mine; afterwards I was
not, and left.

GENERAL ALEXANDROV: I have no more questions, your Honour.

THE PRESIDENT: Do you wish to re-examine, Dr. Dix?

DR. DIX: I will put only a few questions which arose from
the cross-examination.



Q. During the cross-examination, the New Plan was again
dealt with without Dr. Schacht having had an opportunity of
explaining it and of stating what role, if any, that plan
had in the economy of rearmament and who was the originator,
the responsible originator of the New Plan. Therefore, may I
put this question to Dr. Schacht now?

A. The New Plan was a logical consequence of the economic
development which followed the Treaty of Versailles. I
mention again only briefly that by the removal of German
property abroad, the entire organization for German foreign
trade was taken away and therefore great difficulties arose
for German export.

Without those exports, however, payment of reparations or
such, was out of the question. Nevertheless, all the Great
Powers, particularly those who were competing with Germany
in the world market, resorted to raising their tariffs in
order to exclude German merchandise from their markets or to
make it more difficult for Germany to sell her goods, so
that it became more and more of a problem to develop German

When Germany, in spite of this, tried by lower prices at the
cost of lower wages, to maintain or to increase her export
trade, the other powers resorted to other means to meet
German competition. I recall the various devaluations of
foreign currencies which were made, again impeding the
competition of German products. When even that did not
suffice, the system of quotas was invented; that is, the
amount of goods which were imported into a country could not
go beyond a certain quota; that was prohibited. Such quotas
for German imports were established by Holland, France and
other nations; so here, also, German export was made
increasingly difficult.

All these measures to hinder German export led to the
situation - that German nationals, also, could no longer pay
even private debts abroad. As you have heard here, for many
years I had warned against incurring these debts. I was not
listened to. It will be of interest to you for me to state
here briefly that Germany,

                                                   [Page 76]

against my advice, had within five years contracted as large
a foreign debt as the United States had throughout the forty
years before the first World War.

Germany was a highly developed industrial nation and did not
need foreign money, and the United States at that time was
going in more for colonial development and could make good
use of foreign capital.

When we were no longer able to pay our interest abroad, some
countries resorted to the method of no longer paying German
exporters the proceeds from the German exports, but
confiscated these funds, and out of these paid themselves
the, interest on our debts abroad; that is, effecting a
settlement, so to speak. That was the so-called Clearing
System. The private claims were confiscated in order to meet
the demands of foreign countries.

To meet this development, I sought a way to continue German
exports. I set out a very simple principle: "I will buy only
from those who buy from me." Therefore, I looked around for
countries which were prepared to cover their needs in
Germany, and I prepared to buy my merchandise there. That
was the New Plan.

THE PRESIDENT: I do not know what we have to do with this,
Dr. Dix.


Q. Well, to make a long story short, the New Plan had
nothing to do with the intention to rearm, let alone with
any aggressive intentions.

A. Absolutely nothing.

Q. In this connection, can you give an estimate as to what
percentage of German economic production was armament

A. That question has been put to me in previous
interrogations and at that time I was not able to answer it,
because I could not recall what amount Germany expended on
her armament. Now, from the testimony of Field Marshal
Keitel, we have heard here that armament expenditure during
these years when the Reichsbank was still co-operating, 1934-
1935, 1935-1936, 1936-1937 and so on, amounted respectively
to five billions of Reichsmark, seven billions of Reichsmark
and nine billions of marks; that is the estimate of experts.
The production of the entire German economy during these
years could be estimated approximately at fifty to sixty
billion Reichsmark. If I compare that with the armament
expenditure, which has been stated here by a witness, then
we find that armament expenditure amounted to about ten to
fifteen per cent of the entire German economy during the
years when I had anything to do with it.

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