The Nizkor Project: Remembering the Holocaust (Shoah)
Nuremberg, war crimes, crimes against humanity

The Trial of German Major War Criminals

Sitting at Nuremberg, Germany
2nd May to 13th May, 1946

One Hundred and Twentieth Day: Friday, 3rd May, 1946
(Part 9 of 12)

DR. DIX continues his redirect examination of Hjalmar Schacht]

[Page 80]

Q. That answers the question fully.

Now the prosecution accuses Schacht and alleges that Hitler picked out Schacht to finance armament for an aggressive war. You, Herr Vocke, were a member of the Reichsbank directorate and you worked with him during all those years. Therefore, I ask you to tell the Tribunal whether anything came out in the course of conversations, or you noticed anything about Schacht's activities and work which would justify such a reproach.

A. No. Schacht often expressed the view that only a peaceful development could restore Germany and not once did I hear him say anything which might suggest that he knew anything about the warlike intentions of Hitler. I have searched my memory and I recall three or four incidents which answer that question quite clearly. I should like to mention them in this connection.

The first was the 420,000,000 gold mark credit which was repaid in 1933. Luther, when the Reichsbank cover disintegrated in the crisis -

[Page 81]

DR. DIX: May I interrupt for the information of the Tribunal. Luther was Schacht's predecessor.

A. - in 1931 when the cover for the issue of notes had to be cut down, Luther in his despair sent me to England in order to acquire a large credit in gold from the Bank of England which would restore confidence in the Reichsbank. Governor Norman was quite prepared to help me, but he said that it would be necessary for that purpose to approach also the Federal Reserve Bank of New York, the Bank of France, and the International Bank in Basle. That was done and the credit amounted to 420 million gold marks, but the inclusion of the Bank of France created political difficulties which delayed the credit for about ten or twelve days.

When I returned to Berlin, I was shocked to hear that the greater part of the credit had already been used up. The gold was torn from our hands, and I told Luther, "The credit has lost its usefulness, and we must repay it immediately. Our honour is our last asset. The banks which have helped us shall not lose a single penny."

Luther did not have sufficient understanding for that, and he said in so many words "What one has, one holds. We do not know for what purposes we may still have urgent need of the gold." And so the credit was extended and dragged out over years.

When Schacht came to the bank in 1933, I told myself, Schacht will understand me, and he did understand me immediately. He agreed with me, and he repaid that credit without hesitation. It never entered his head that one might use that enormous sum of gold for some other purpose, and I say here that if Schacht had known of any plans for a war, he would have been a fool to pay back 420,000,000 gold marks.

The second incident - I can't give the exact date, but I believe it was in 1936. The Reichsbank received a letter from the Command of the Army or the General Staff marked "Top Secret," with the request to remove the gold reserves of the Reichsbank, the securities and bank note reserves from the frontier regions of Germany to a zone in the interior. The reasons given were the following: In the event of a threat to attack Germany on two fronts, the Command of the Army had decided to evacuate the frontier areas and to confine itself to a central zone which was to be defended at all costs. I still remember from the map which was attached to the letter that the line of defence in the east -

THE PRESIDENT: It seems to the Tribunal that this is very remote from any question we have to decide.

DR. DIX: Your Lordship, that map which the witness wants to describe shows clearly and beyond doubt that the attitude of the German High Command in 1936 was a defensive attitude and one which accepted great strategic disadvantages; and this was communicated to the Reichsbank under the presidency of Schacht. We can see from that communication that nobody at that time even thought of aggressive intentions of the Army Command.

THE PRESIDENT: At what time?

DR. DIX: I understood him to say that - Perhaps it is better that he should give you the date.

A. I cannot say exactly what the date was, but it must have been about 1936, in my estimation.

DR. DIX: I believe that it is extremely relevant. May the witness continue?


A. The line of defence in the East went from Hof straight up to Stettin; I cannot remember so well where the Western line was drawn, but Baden and the Rhineland were outside of it.

[Page 82]

The Reichsbank was shocked to hear about that and about the threat of a two-front attack on Germany and the tremendous sacrifice of German territory. It was also shocked at the idea that the Reichsbank, in the event of an occupation of these regions by the enemy, would have to leave these occupied territories without any financial support. Therefore we refused the last mentioned request, but, as far as the gold was concerned, we placed it in Berlin, Munich, Nuremberg, and so on.

We could no longer have any doubt, however, after this top secret document, about the defensive character of our armaments and preparations.

I come to a third incident. That was in 1937. At that time, when the economy was already running smoothly and more and more money was being put in, Schacht asked for the support of the German professors, economists, and called them together to persuade them to work along his lines, that is to try to check this trend. At that meeting one of those present asked Schacht the question, "What will happen if war breaks out?" Schacht got up and said, "Gentlemen, then we are lost. Then everything is over with us. I ask you to drop this subject. We cannot worry about it now."

Now I come to the fourth incident, which also leaves no doubt about Schacht's attitude or the completeness of his information. That was a conversation immediately after the outbreak of the war. In the first few days Schacht, Hulse, Dreise, Schniewind and I met for a confidential talk. The first thing Schacht said was, "Gentlemen, this is a fraud such as the world has never seen. The Poles have never received the German ultimatum. The newspapers are lying in order to lull the German people. The Poles have been attacked. Henderson did not even receive the ultimatum, but only a short excerpt from the note was given to him verbally. If at any time at the outbreak of a war, the question of guilt was clear, then it is so in this case. That is a crime the like of which cannot be imagined."

Then Schacht continued: "What madness to start a war with a military power like Poland, which is led by the best French general staff officers. Our armament is no good. It has been bungled and there is no thought-out plan. The money has been wasted."

To the retort "But we have an air striking force, which can make itself felt," Schacht said, "The air force does not decide the outcome of a war, but only the ground forces. We have no heavy guns, no tanks; in three weeks the German armies in Poland will break up, and then think of the coalition which will be ranged against us."

Those were Schacht's words and they made a deep impression on me; for me they are a definite and clear answer to the question which Dr. Dix put to me.

Q. Now, in the course of those years from 1933 to 1939 did Schacht ever speak to you about alleged or surmised war plans of Hitler?

A. No, never.

Q. What was Schacht's basic attitude to the idea of a war; did he ever mention that to you?

A. Yes, of course, fairly often. Schacht always emphasized that war destroys and ruins both the victor and the vanquished, and, in his and our field, he pointed to the example of the victorious powers whose economy and currency had been devaluated and practically crippled. England had to devaluate her currency; in France there was a complete breakdown of the financial system, not to speak of other powers, such as Belgium, Poland, Roumania and Czechoslovakia.

Q. Schacht made these statements?

A. Yes, he did, and quite frequently. Schacht went into detail and was very definite about the situation in neutral countries. Schacht said again and again, there will be conflicts and war again, but for Germany there is only one policy, absolute neutrality. And he quoted the examples of Switzerland, Sweden, and so on, who by their neutral attitude had grown rich and more powerful and become creditor nations. Schacht again and again emphasized that very strongly.

[Page 83]

Q. In that connection you will understand my question. How can you explain then, or rather, how did Schacht explain to you the fact that he was financing armament at all?

A. Schacht believed at that time that a certain quantity of armaments, such as every country in the world possessed, was also necessary for Germany for political -

Q. May I interrupt you. I want you to state only the things which Schacht told you, not your opinions about what Schacht may have thought, but only what Schacht actually said to you.

A. Yes. Schacht said a foreign policy without armament is impossible over a period of time. Schacht also said that neutrality, which he demanded for Germany in case of conflict between the big powers, must be an armed neutrality. Schacht considered armaments necessary, because, otherwise, Germany would always be defenceless in the midst of armed nations. He was not thinking of definite attack from any side, but he said in every country there is a militarist party which may come to power today or tomorrow, and a completely helpless Germany, surrounded by other nations, is unthinkable. It is even a danger to peace because it is an incentive to attack one day. Finally, however, and principally Schacht saw in armaments the only means of revitalising and starting up German economy as a whole. Barracks would have to be built. The building industry, which is the backbone of economy, must be revitalised. Only in that way he hoped, could unemployment be tackled.

Q. Now, events led to the militarisation of the Rhineland, the re-introduction of compulsory military service. Did you have conversations with Schacht in which he said that if this policy of Hitler was pursued it might lead to a war, at least to an armed intervention by other nations which did not approve of such policies? Were there any such conversations between you and Schacht?

A. Not in the sense of your question. Schacht did speak to me about the incidents when the Rhineland was re-occupied, that is to say, he explained to me that at that time Hitler, as soon as France adopted a somewhat menacing attitude, was resolved to withdraw his occupation forces - Hitler had climbed down - and was only prevented in this by von Neurath, who said to him, "I was against that step but now that you've done it, it will have to stand." What Schacht told me at that time about Hitler's attitude was that Hitler would do anything rather than have a war. Schacht also felt this, as he told me, when he mentioned the friendship with Poland, the renunciation of his claim to Alsace-Lorraine, and, in particular, Hitler's policy during the first years, all of which was a peaceful policy. Only later did he begin to have misgivings as regards foreign policy.

Q. What were Schacht's principles and ideas in foreign policy and how did these line up with his attitude to Hitler's foreign policy?

A. He definitely disapproved, especially of course, since Ribbentrop had gained influence in foreign politics, Schacht saw in him the most incapable and irresponsible of Hitler's advisers. But already before that there were serious differences of opinion between Schacht and Hitler on foreign policy.

For instance, as regards Russia: Already from 1928 and 1929 onwards Schacht had built up a large trade with Russia by long term credits which helped the economy of both countries. He has often been attacked on account of that, but he said, "I know what I'm doing. I also know that the Russians will pay punctually and without bargaining. They have always done it." Schacht was very angry and unhappy when Hitler's tirades of abuse spoiled the relations with Russia and brought this extensive trade to an end.

Also as regards China, Schacht was convinced of the importance of trade with China and was just about to develop it on a large scale, when Hitler, by showing preference to Japan and recalling the German advisers to Chiang-Kai-Chek, again destroyed all Schacht's plans. Schacht saw that this was a fatal mistake and said that Japan would never be able nor willing to compensate us for the loss of trade with China.

[Page 84]

Also Schacht always advocated close co-operation with the United States, with England, and with France. Schacht admired Roosevelt and was proud of the fact that Roosevelt, through the diplomat Cockerill, kept in constant touch with him. Schacht was convinced of the necessity of remaining on the best terms with England and France, and for that very reason he seriously disapproved of Ribbentrop being sent to London.

Schacht was against Hitler's policy towards Italy. He knew that Mussolini did not want to have anything to do with us, and he considered him the most unreliable and weakest partner.

As regards Austria, I only know that Schacht thought a great deal of Dollfuss and was horrified and shocked when he heard of his murder. Also after the occupation of Austria, he disapproved of much that happened there.

May I, in this connection, say a word about Schacht's colonial policy, which was a sort of hobby of Schacht and about which he once gave a lecture? I can best illustrate Schacht's views by telling you about the orders which he gave me. Schacht's idea was to make an arrangement with the powers, England, France, etc., whereby these powers should purchase part of the Portuguese colony of Angola and transfer it to Germany, not that she would exercise any sovereign rights, but would exploit it economically, and he had experts' opinions -

THE PRESIDENT: Dr. Dix, the Tribunal thinks that this is being given in far too great length.


Q. Well, we can leave out the individual examples. The late Field-Marshal Blomberg made a statement to the effect that the Reichsbank received every year from the Ministry of Defence a written communication about the state of the armaments. Do you, who were a member of the directorate, know anything about this communication?

A. No, I have never heard anything about it.

Q. From the whole of your experience in the Reichsbank and your experience of Schacht's attitude to his colleagues, do you consider it possible that Schacht personally received that information, but did not pass it on to any of his colleagues in the Reichsbank Directorate?

A. It may be, but I consider it highly improbable.

Q. Now, when did Schacht start to try to stop the financing of armaments and thereby check rearmament; and, it he did try, and if you can affirm it, what were his reasons?

A. Schacht made the first attempts to limit armaments, I believe, about 1936, when economy was operating at top speed and further armament seemed an endless spiral. The Reichsbank was blocked and, I believe, in 1936, Schacht himself started making serious attempts to put an end to armaments.

Q. And do you know from your own experience what these attempts were?

A. These attempts continued throughout the following years: First, Schacht tried to influence Hitler and that proved to be in vain. His influence decreased as soon as he made any such attempt. He tried to find allies in the civic ministries, and also among the generals. He also tried to win over Goering, and he thought he had won him over, but it did not work. Schacht then put up a fight and at last he succeeded in stopping the Reichsbank credits for armaments. That was achieved at the beginning of March, 1938. But that did not mean that he discontinued his efforts to stop rearmament itself, but he continued to use every means, even sabotage.

In 1938 he issued a loan at a time when he knew that the previous loan had not yet been absorbed; when the banks were still full of it; and he made the amount of the new loan so big that it was doomed to failure. We waited eagerly to see whether our calculations were correct. We were happy when the failure became obvious, and Schacht informed Hitler.

[Page 85]

Another way in which he tried to sabotage armaments, was when the industries which applied for loans to expand their factories were prohibited from doing so by Schacht, and thus were prevented from expanding. The termination of the Reichsbank credit did not only mean that the Reichsbank could no longer finance armaments, but it dealt a serious blow to armament itself. This was shown in 1938, when financing became extremely difficult in all fields, and upon Schacht's resignation, immediately reverted to the direct credits of the issuing bank, which was the only means of maintaining elastic credit, the so-called perpetual credit, which Hitler needed and could never have received from Schacht.

I know that from my personal recollection, because I protested against that law which was put to me and which Hitler issued after Schacht's dismissal. I said to the Vice- President: "I am not going to have anything to do with it." Thereupon, I was immediately dismissed ten days after.

Q. Now, Herr Vocke, for those not in the know, the motive for stopping the financing of armaments may have been purely economic? Have you any grounds, have you any experience which shows that Schacht was now also afraid of war and wanted to prevent a war by this stoppage of credit?

A. Yes. At any rate, in 1938 the feeling that this tremendous armaments programme which had no limits would lead to war, became stronger and stronger, especially after the Munich Agreement. In the meantime, Schacht had realised, and I think the Fritsch affair had made it very clear to him, that Hitler was the enemy, and that there was only one thing to do; that was to fight against Hitler's armament programme and war-mongering by every possible means. These means, of course, were only financial, such as sabotage, etc., as I have already described. The final resort was the memorandum by which Schacht forced his resignation.

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