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It is well known that the Nazi conspirators rearmed Germany on a vast scale. The purpose of that rearmament is revealed in the secret records of the plans and deliberations of the inner councils of the Nazis. These records show that the reorganization of the German government, the financial wizardry of Hjalmar Schacht, and the total mobilization of the German economy largely under Hjalmar Schacht, Hermann Goering, and Walter Funk, were directed at a single goal: aggressive war.

I. ECONOMIC MOBILIZATION FOR WAR

The significance of the economic measures adopted and applied by the conspirators can be properly appraised only if they are placed in the larger social and political context of Nazi Germany. These economic measures were adopted while the conspirators were directing their vast propaganda apparatus to the glorification of war. They were adopted while the conspirators were perverting physical training into training for war. They were adopted while these conspirators were threatening to use force and were planning to use force to achieve their material and political objects. In short, these measures constitute in the field of economics and government administration the same preparation for aggressive war which dominated every aspect of the Nazi state.

In 1939 and 1940, after the Nazi aggression upon Poland, Holland, Belgium, and France, it became clear to the world that the Nazi conspirators had created probably the greatest instrument of aggression in history. That machine was built up almost in its entirety in a period of less than one decade. In May of 1939 Major General George Thomas, former Chief of the Military-Economic Staff in the Reich War Ministry, reported that the German Army had grown from seven Infantry divisions in 1933 to thirty-nine Infantry divisions, among them four fully motorized and three mountain divisions; eighteen Corps Headquarters; five Panzer divisions; twenty-two machine gun battalions. Moreover, General Thomas stated that the German Navy had greatly expanded by the launching, among other vessels, of two battleships of thirty-five thousand tons, four heavy cruisers of ten thousand tons, and other warships; further, that the Luftwaffe had grown to a point where it had a strength of two hundred sixty thousand men, twenty-one squadrons, consisting of two hundred forty echelons, and thirty-three Anti-Aircraft Batteries. (EC-28)

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General Thomas further reported, in a lecture delivered on 24 May 1939 in the Nazi Foreign Office, that out of the few factories permitted by the Versailles Treaty there had arisen *******

"The mightiest armament industry now existing in the world. It has attained the performances which in part equal the German wartime performances and in part even surpasses them. Germany's crude steel production is today the largest in the world after the Americans. The aluminum production exceeds that of America and of the other countries of the world very considerably. The output of our rifle machine gun, and artillery factories is at present larger than that of any other state." (EC-28)

These results about which General Thomas spoke in his book entitled Basic Facts for a History of German War and Armaments Economy were achieved only by making preparation for war the dominating objective of German economy. As General Thomas stated on page 479 of his book:

"History will know only a few examples of cases where a country has directed, even in peace time, all its economic forces deliberately and systematically towards the requirements of war, as Germany was compelled to do in the period between the two World Wars." (2353-PS)

The task of mobilizing the German economy for aggressive war began promptly after the Nazi conspirators' seizure of power. It was entrusted principally to Schacht, Goering, and Funk.

Schacht was appointed President of the Reichsbank in March 1933, and Minister of Economics in August 1934. The world did not know, however, that the responsibility for the execution of this program was entrusted to the office of the Four Year Plan under Goering (EC-408). Nor did the world know that Schacht was designated Plenipotentiary for the War Economy on 21 May 1935, with complete control over the German civilian economy for war production in the Reich Defense Council, established by a top secret Hitler decree.

A letter dated 24 June 1935, at Berlin, and signed by von Blomberg, reads in part:

" ***The Fuehrer and Reich Chancellor has nominated the President of the directorate of the Reichsbank, Dr. Schacht, to be Plenipotentiary-General for War Economy.

"***I point out the necessity of strictest secrecy once more ***." (2261-PS)

Through Schacht's financial genius monetary measures were devised to restore German industry to full production; and through

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the control of imports and exports, which he devised under his new plan of 1934, German production was channeled in accordance with the requirements of the German war machine.

In 1936, with an eye to the experience in the First World War, the Nazi conspirators embarked on an ambitious plan to make Germany completely self-sufficient in strategic war materials such as rubber, gasoline, and steel, in a period of four years, so that Germany would be fully prepared for aggressive war. The responsibility for the execution of this program was entrusted to the office of the Four Year Plan under Goering. A "memorandum on the Four Year Plan and Preparation of the War Economy," dated 30 December 1936, and marked "Secret Command Matter", sets out that the Fuehrer and Reich Chancellor has conferred powers in regard to mobilization preparations in the economic field that need further definition. The third paragraph refers specifically to Minister-President, Generaloberst Goering as Commissioner of the Four Year Plan, by authority of the Fuehrer and Reich Chancellor granted 18 October 1936. The existence of this program involved the reorganization and control of the whole German economy for war. (EC-408)

The military objectives of the German economy were clearly stated by General Thomas in a lecture on 28 February 1939, delivered at the Staff Instructor's course. He stated:

"The National Socialist State, soon after taking over the power, has reorganized the German economy in all sections and directed it towards a military viewpoint, which had been requested by the Army for years. Due to the reorganization, agriculture, commerce and professions became those powerful instruments the Fuehrer needs for his extensive plans, and we can say today that Hitler's mobile politics, as well as the powerful efforts of the Army and economy, would not have been possible without the necessary reorganization by the National Socialist Government. We can now say that the economic organization as a whole corresponds with the needs, although slight adjustments will have to be made yet. Those reorganizations made a new system of economics possible which was necessary in view of our internal and foreign political situation as well as our financial problems. The directed economy, as we have it today, concerning agriculture, commerce and industry, is not only the expression of the present State principles, but at the same time also the economy of the country's defense." (EC-27)

This program was not undertaken in a vacuum; it was deliberately designed and executed to provide the necessary instrument

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of the Nazi conspirators' plans for aggressive war. In September 1934 Schacht admitted to the American Ambassador in Berlin that the Hitler Party was absolutely committed to war, and that the people too were ready and willing. (EC- 461). At the same time Schacht promulgated his new plan for the control of imports and exports in the interest of rearmament. A year later he was appointed Plenipotentiary for War Economy by top secret decree (2261-PS)

On 4 September 1936 Goering announced, at a Cabinet meeting attended by von Blomberg, Schacht, and others, that Hitler had issued instructions to the Reich War Minister on the basis that "the show-down with Russia is inevitable," and added that "all measures have to be taken just as if we were actually in the stage of imminent danger of war." (EC-416)

In the same month the office of the Four Year Plan was created with the mission of making Germany self-sufficient for war in four years. Goering regarded it as his task, within four years, to put the entire economy in a state of readiness for war. (EC-08)

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