2) Schacht favored the acquisition of additional territory for Germany-peacefully if possible, but by aggressive war, if necessary. Schacht had long been a German nationalist and
expansionist. As early as 1927, he spoke against the Versailles Treaty:
"The Versailles Dictate cannot be an eternal document, because not only its economic, but also its spiritual and moral premises are wrong." (EC-415)
He strongly favored the acquisition by Germany of both colonial territory and contiguous territory in Europe. At the Paris conference on 16 April 1929, he said:
"Germany can generally only pay if the Corridor and Upper Silesia will be handed back to Germany from Polish possession, and if besides somewhere on the earth colonial territory will be made available to Germany." (3726-PS)
In a speech in Danzig in June 1935, Schacht ascribed the economic difficulties which confronted Danzig to "historical errors of the greatest extent which were beyond the control of the German people". He sought to comfort his listeners with the assurance that
"We Germans in the Reich today are looking with fullest confidence upon our comrades in the Danzig Free State, and maintain our people's fellowship with the interests, wishes and hopes of this territory which has unfortunately been separated from us." (EC-498)
In January 1936, Schacht again publicly spoke against the Versailles Treaty, and impliedly threatened war unless its terms were revised in Germany's favor. At that time, he stated:
"But the memory of war weighs undiminished upon the people's minds. That is because deeper than material wounds, moral wounds are smarting, inflicted by the so- called peace treaties. Material loss can be made up through renewed labor, but the moral wrong which has been inflicted upon the conquered peoples, in the peace dictates, leaves a burning scar on the people's conscience. The spirit of the Versailles has perpetuated the fury of war, and there will not be a true peace, progress or reconstruction until the world desists from this spirit. The German people will not tire of pronouncing this warning."
Later in the same year, Schacht again publicly advocated "Lebensraum" for the German people in terms not unlike those employed by Hitler. In his speech at Frankfurt on 9 December 1936, Schacht said:
"Germany has too little living space for her population. She has made every effort, and certainly greater efforts than any other nation, to extract from her own existing small space, whatever is necessary for the securing of her liveli-
hood. However, in spite of all these efforts the space does not suffice." (EC-415)
Schacht had hoped, it is believed, that his desire for additional space for Germany would be realized without resort to war. In Austria, for example, he had authorized 200,000 Marks a month to be set aside for the National Socialists in Austria, hoping thereby to facilitate the absorption of Austria into Germany without war. But if Germany's neighbors would not accede to the conspirators' demands for additional space, Schacht was willing to go to war to fulfill those demands.
Thus, on 23 September 1935, Schacht told S. R. Fuller, Jr. at the American Embassy in Berlin:
"Colonies are necessary to Germany. We shall get them through negotiation if possible; but if not, we shall take them."
In January 1937, Schacht, in a conversation with Ambassador Davies, impliedly threatened a breach of the peace unless Germany's demands for colonies were met. The conversation is related as follows in a report under date of 20 January 1937, by Ambassador Davies to the Secretary of
"He [Schacht] stated the following: that the present condition of the Germany people was intolerable, desperate and unendurable; that he had been authorized by his Government to submit proposals to France and England which would (1) guarantee European peace; (2) secure present European international boundaries; (3) reduce armaments; (4) establish a new form of a workable League of Nations; (5) abolish sanctions with new machinery for joint administration; all based upon a colonial cession that would provide for Germany an outlet for population, source for food stuffs, fats and raw material. ***" (L-111)
The inference was clear: without a colonial cession, peace could not be guaranteed. Equally clear was the inference that it would be Germany in its search for "Lebensraum" that would disturb the peace.
On 21 December 1937, Schacht indicated to Ambassador Dodd that he desired the annexation of neighboring countries, without war if possible, but with war, if necessary. The pertinent portion of Ambassador Dodd's notes on this conversation are as follows:
"Schacht meant what the Army chiefs of 1914 meant when they invaded Belgium, expecting to conquer France in six weeks; i.e., domination and annexation of neighboring little countries, especially north and east. Much as he dislikes
Hitler's dictatorship, he, as most other eminent Germans, wishes annexation -- without war if possible, with war, if the United States will keep hands off." (EC-461)
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