Trial of the Major War Criminals Before the International Military Tribunal, Nuremburg, 14 November 1945-1 October 1946, Volume 13
[Cover Illustration]
TRIAL OF THE MAJOR WAR CRIMINALS
BEFORE
THE INTERNATIONAL MILITARY TRIBUNAL
N U R E M B E R G 14 NOVEMBER 1945—1 OCTOBER 1946
P U B L I S H E D A T N U R E M B E R G , G E R M A N Y 1 9 4 8
This volume is published in accordance with the direction of the International Military Tribunal by the Secretariat of the Tribunal, under the jurisdiction of the Allied Control Authority for Germany.
VOLUME XIII
O F F I C I A L T E X T
I N T H E
ENGLISH LANGUAGE
P R O C E E D I N G S
3 May 1946—15 May 1946
One Hundred and Twentieth Day, Friday, 3 May 1946, Morning Session 1 Afternoon Session 44
One Hundred and Twenty-first Day, Saturday, 4 May 1946, Morning Session 80
One Hundred and Twenty-second Day, Monday, 6 May 1946, Morning Session 103 Afternoon Session 129
One Hundred and Twenty-third Day, Tuesday, 7 May 1946, Morning Session 166 Afternoon Session 203
One Hundred and Twenty-fourth Day, Wednesday, 8 May 1946, Morning Session 231 Afternoon Session 246
One Hundred and Twenty-fifth Day, Thursday, 9 May 1946, Morning Session 267 Afternoon Session 296
One Hundred and Twenty-sixth Day, Friday, 10 May 1946, Morning Session 330 Afternoon Session 372
One Hundred and Twenty-seventh Day, Saturday, 11 May 1946, Morning Session 410
One Hundred and Twenty-eighth Day, Monday, 13 May 1946, Morning Session 437 Afternoon Session 467
One Hundred and Twenty-ninth Day, Tuesday, 14 May 1946, Morning Session 496 Afternoon Session 523
One Hundred and Thirtieth Day, Wednesday, 15 May 1946, Morning Session 559 Afternoon Session 600
ONE HUNDRED AND TWENTIETH DAY Friday, 3 May 1946
Morning Session
[The Defendant Schacht resumed the stand.]
THE PRESIDENT (Lord Justice Sir Geoffrey Lawrence): The Tribunal will sit in open session tomorrow at 10 o’clock and will adjourn into closed session at 12 noon.
Mr. Justice Jackson and Defendant Schacht: It is desired on behalf of the interpreters that you should pause if possible after the question has been put to you and if you find it necessary, owing to the condition of the documents with which you are dealing, to read in English or speak in English, to give an adequate pause so that those interpreters who are interpreting from English into other languages can take over the interpretation. Is that clear?
MR. JUSTICE ROBERT H. JACKSON (Chief of Counsel for the United States): I owe an apology constantly to the interpreters. It is hard to overcome the habit of a lifetime.
THE PRESIDENT: It is very difficult.
MR. JUSTICE JACKSON: [Turning to the defendant.] Dr. Schacht, by the way, the photograph Number 10 which was shown you yesterday, that was one of the occasions on which you wore the Party Badge which you referred to, was it not?
HJALMAR SCHACHT (Defendant): That may be.
MR. JUSTICE JACKSON: You are quite sure of that, are you not?
SCHACHT: I cannot distinguish it clearly; but it may be, and that would prove that the picture must have been taken after 1937.
MR. JUSTICE JACKSON: That is what I wanted to prove. And as a matter of fact, it was taken after 1941, was it not? As a matter of fact, Bormann did not come to any important official position until after 1941, did he?
SCHACHT: Bormann?
MR. JUSTICE JACKSON: Bormann, yes.
SCHACHT: That I do not know.
MR. JUSTICE JACKSON: Now, if we return to the Four Year Plan which began in 1936, as I understand it you opposed the appointment of Göring to have charge of the Four Year Plan on two grounds: First, you thought that that new plan might interfere with your functions; and secondly, if there were to be a Four Year Plan, you did not think Göring was fit to administer it?
SCHACHT: I do not know what you mean by “opposed.” I was not satisfied with it and considered the choice of Göring not the right one for any leading position in economics.
MR. JUSTICE JACKSON: As a matter of fact you have described Göring as a fool in economics, have you not?
SCHACHT: Yes, as one does say such things in a heated conversation.
MR. JUSTICE JACKSON: Or in interrogation?
SCHACHT: Interrogations are also sometimes heated.
MR. JUSTICE JACKSON: Now, very soon Göring began to interfere with your functions, did he not?
SCHACHT: He tried it repeatedly, I believe.
MR. JUSTICE JACKSON: Well, he got away with it too, did he not?
SCHACHT: I do not understand what you mean by “he got away with it.”
MR. JUSTICE JACKSON: Well, this American slang is difficult, I admit. I mean he succeeded.
SCHACHT: In July 1937 he had me completely against the wall.
MR. JUSTICE JACKSON: That started over a proposal that he made or a measure that he took with reference to mining?
SCHACHT: Yes.
MR. JUSTICE JACKSON: He also made a speech to some industrialists, did he not?
SCHACHT: I assume that he made several speeches to industrialists. I do not know to which one you are referring. I presume you mean the speech in December 1936 or so.
MR. JUSTICE JACKSON: I am referring to the speech in which you said to us in interrogation that Göring had assembled industrialists and said a lot of foolish things about the economy which you had to refute.
SCHACHT: That was the meeting of 17 December 1936.
MR. JUSTICE JACKSON: And then you wrote to Göring complaining about the mining measures?
SCHACHT: I assume that you mean the letter of 5 August?
MR. JUSTICE JACKSON: Right. That document is Document EC-497, Exhibit USA-775. And in that letter of August 1937 you said this, if I quote you correctly:
“Meanwhile I repeatedly stressed the need of increased exports and actively worked towards that end. The very necessity of bringing our armament up to a certain level as rapidly as possible must place in the foreground the idea of as large returns as possible in foreign exchange and therewith the greatest possible assurance of raw material supplies.”
Correct?
SCHACHT: I assume it is.
MR. JUSTICE JACKSON: And you also said this, I believe:
“I have held this view of the economic situation which I have explained above from the first moment of my collaboration.”
That was also true, was it not?
SCHACHT: Yes, certainly.
MR. JUSTICE JACKSON: Now, both of those things were true, were they not?
SCHACHT: Yes.
MR. JUSTICE JACKSON: And then you concluded, addressing Göring:
“I ask you to believe me, my dear Prime Minister, that it is far from me to interfere with your policies in any way whatsoever. I offer no opinion, either, as to whether my views, which are not in agreement with your economic policy, are correct or not. I have full sympathy for your activities. I do believe, however, that in a totalitarian state it is wholly impossible to conduct two divergent economic policies.”
And that was also true, was it not?
SCHACHT: Yes.
MR. JUSTICE JACKSON: And that was the basis on which you and Göring disagreed so far as policy was concerned?
SCHACHT: So far as what was concerned?—Policy? I do not understand what you mean by policy. I mean the way business was conducted.
MR. JUSTICE JACKSON: Yes.
SCHACHT: Entirely aside from other differences which we had.
MR. JUSTICE JACKSON: These other differences were personal differences. You and Göring did not get along well together?
SCHACHT: On the contrary. Until then we were on very friendly terms with each other.
MR. JUSTICE JACKSON: Oh, were you?
SCHACHT: Oh, yes.
MR. JUSTICE JACKSON: So the beginning of your differences with Göring was the struggle as to which of you would dominate the preparations for war?
SCHACHT: No.
MR. JUSTICE JACKSON: Well...
SCHACHT: I have to deny that absolutely. The differences...
MR. JUSTICE JACKSON: Do you want to say anything more about it?
SCHACHT: The differences which led to my resignation resulted from the fact that Göring wanted to assume command over economic policies while I was to have the responsibility for them. And I was of the opinion that he who assumes responsibility should also have command; and if one has command then he also has to assume the responsibility. That is the formal reason why I asked for my release.
MR. JUSTICE JACKSON: Well now, I turn to your interrogation of 16 October 1945, Document 3728-PS, Exhibit USA-636, and ask if you did not give the following testimony:
“After Göring had taken over the Four Year Plan—and I must say after he had taken over the control of Devisen, already since April 1936—but still more after the Four Year Plan in September 1936, he had always tried to get control of the whole economic policy. One of the objects, of course, was the post of Plenipotentiary for War Economy in the case of war, being only too anxious to get everything into his hands, he tried to get that away from me. Certainly as long as I had the position of Minister of Economics, I objected to that...”
You made that statement?
SCHACHT: I believe that is correct.
MR. JUSTICE JACKSON: Yes, and then you describe your last visit with him after Luther for two months had endeavored to unite Göring and yourself.
SCHACHT: That is a mistake; it is Hitler, and not Luther.
MR. JUSTICE JACKSON: Very well.
You described it as follows:
“Then I had a last talk with Göring; and at the end of this talk Göring said, ‘But I must have the right to give orders to you.’ Then I said, ‘Not to me, but to my successor.’ I have never taken orders from Göring; and I would never have done it, because he was a fool in economics and I knew something about it, at least.
“Question: ‘Well, I gather that was a culminating, progressive, personal business between you and Göring. That seems perfectly obvious.’
“Answer: ‘Certainly.’”
Is that correct?
SCHACHT: Yes, certainly.
MR. JUSTICE JACKSON: And then the interrogator went on:
“Let us go into the duties of that job for a moment and see what he was trying to take away from you. There are only two possibilities, as it has been explained to me; if I am wrong, correct me. One would be the preparation for a mobilization, and the other would be the actual taking charge of this in the event of war. Otherwise, the post had no meaning. So the things you resisted his taking away from you, as I see it, were the right to be in charge of the preparation for mobilization and, secondly, the right to control in the event of war.
“Answer: ‘Correct.’”
Did you give that testimony?
SCHACHT: Please, Mr. Justice, you are confusing the events in relation to time. The differences with Göring about this so-called Plenipotentiary for War Economy occurred in the winter 1936-37; and the so-called last conversation with Göring which you have just mentioned took place in November 1937. I stated, I believe in January 1937, that I was prepared to turn over the office and the activity as Plenipotentiary for War Economy immediately to Göring. That can be found in the memorandum from the Jodl Diary which has been frequently mentioned here.
At that time the War Ministry, and Blomberg in particular, asked to have me kept in the position of Plenipotentiary for War Economy, since I was the Minister of Economy, as long as I was the Minister of Economy. You can find the correspondence about that, which I think has already been submitted by you to the Tribunal.
MR. JUSTICE JACKSON: Well, all right; I think the dates appear in your testimony. I am not concerned at the moment with the sequence of events; I am concerned with the functions that you were quarreling over, and which you described in your interrogations. And the questions and answers which I read to you are correct; these are the answers you made at the time, are they not?
SCHACHT: Yes, but I must say the following: If you ask me about these individual phases, it will give an entirely different picture if you do not single out the different periods. Mr. Justice, surely you cannot mention events of January and November in the same breath and then ask me if that is correct. That is not correct.
MR. JUSTICE JACKSON: Well, let us get what is wrong about this, if anything.
When was your last conversation with Göring in which you told him he would give orders to your successor but not to you?
SCHACHT: November 1937.
MR. JUSTICE JACKSON: Now, the question as to the duties of the job has nothing to do with relation to time, has it? That is, the Plenipotentiary for War Economy, the disagreement between you and Göring, and in order to make it perfectly clear I will read this question and answer to you again, and I am not concerned with time; I am concerned with your description of the job.
“Question: ‘Let us go into the duties of that job for a moment and see what he was trying to take away from you. Now, there are only two possibilities, as it has been explained to me; if I am wrong, correct me. One would be the preparation for a mobilization, and the other would be the actual taking charge of this in the event of war. Otherwise the post had no meaning. So the things you resisted his taking away from you, as I see it, were the right to be in charge of the preparation for mobilization and, secondly, the right to control in the event of war.’”
And you answered, “correct,” did you not?
SCHACHT: This difference...
MR. JUSTICE JACKSON: Can you answer me first as to whether you did give that answer to that question, that it was correct?
SCHACHT: Yes, the minutes are correct. And now I should like...
MR. JUSTICE JACKSON: All right.
SCHACHT: But now please let me finish.
MR. JUSTICE JACKSON: All right, go ahead with your explanation.
SCHACHT: Yes. Now I wish to say that that disagreement between Göring and myself had absolutely nothing to do with the conversation of November, and that it was not even a disagreement between Göring and myself. That disagreement which you have just read about occurred in January 1937, but it was not at all a difference of opinion between Göring and myself because I said right away, “Relieve me of the post of Plenipotentiary for War Economy and turn it over to Göring.” And the War Ministry, that is, Herr Von Blomberg, protested against this, not I. I was delighted to turn over that office to Göring.
MR. JUSTICE JACKSON: Is there anything in writing about that, Dr. Schacht?
SCHACHT: The documents which you have submitted here. I would like to ask my counsel to look for these documents and to present them during the re-examination. They have been submitted by the Prosecution.
MR. JUSTICE JACKSON: Now, is it not a fact that your controversy with Göring was a controversy of a personal character, between you and him, for control and not a controversy as to the question of armament? You both wanted to rearm as rapidly as possible.
SCHACHT: I do not want to continue that play with words as to whether it was personal or anything else, Mr. Justice. I had differences with Göring on the subject; and if you ask whether it was on armament, speed, or extent, I reply that I was at greatest odds with Göring in regard to these points.
I have never denied that I wanted to rearm in order to gain equality of position for Germany. I never wanted to rearm any further. Göring wanted to go further; and this is one difference which cannot be overlooked.
MR. JUSTICE JACKSON: Now I do not want to play upon words; and if you say my reference to it as personal is a play upon words, you force me to go into what you told us about Göring.
Is it not a fact that you told Major Tilley this?
“Whereas I have called Hitler an amoral type of person, I can regard Göring only as immoral and criminal. Endowed by nature with a certain geniality which he managed to exploit for his own popularity, he was the most egocentric being imaginable. The assumption of political power was for him only a means to personal enrichment and personal good living. The success of others filled him with envy. His greed knew no bounds. His predilection for jewels, gold and finery, et cetera, was unimaginable. He knew no comradeship. Only as long as someone was useful to him did he profess friendship.
“Göring’s knowledge in all fields in which a government member should be competent was nil, especially in the economic field. Of all the economic matters which Hitler entrusted to him in the autumn of 1936 he had not the faintest notion, though he created an immense official apparatus and misused his powers as lord of all economy most outrageously. In his personal appearance he was so theatrical that one could only compare him with Nero. A lady who had tea with his second wife reported that he appeared at this tea in a sort of Roman toga and sandals studded with jewels, his fingers bedecked with innumerable jewelled rings and generally covered with ornaments, his face painted and his lips rouged.”
Did you give that statement to Major Tilley?
SCHACHT: Yes.
MR. JUSTICE JACKSON: Yes. And you say you had no personal differences with Göring?
SCHACHT: Mr. Justice, I ask here again that the different periods of time should not be confused. I found out about all these things only later and not at the time of which you speak, that is, the year 1936.
MR. JUSTICE JACKSON: Do you dispute the testimony of Gisevius that in 1935 he told you about Göring’s complicity in the whole Gestapo setup?
SCHACHT: I have testified here that I knew about the Gestapo camps which Göring had set up and said that I was opposed to them. I do not at all deny that.
MR. JUSTICE JACKSON: But your friendship continued despite that knowledge.
SCHACHT: I have never had a friendship with Göring.
MR. JUSTICE JACKSON: Well...
SCHACHT: I surely cannot refuse to work with him, especially as long as I do not know what kind of a man he is.
MR. JUSTICE JACKSON: All right. Let us take up foreign relations, about which you have made a good deal of complaint here. I think you have testified that in 1937 when you were doing all this rearming, you did not envisage any kind of a war, is that right?
SCHACHT: No, what you are saying, Mr. Justice, is not correct. In 1937 I did not do everything to rearm; but from 1935, from the fall of 1935 on, I tried everything possible to slow down the rearming.
MR. JUSTICE JACKSON: All right. I refer you to your interrogation of 16 October 1945, and ask whether you gave these answers to these questions:
“Question: ‘Let me ask you then, in 1937 what kind of war did you envisage?’
“Answer: ‘I never envisaged a war. We might have been attacked, invaded by somebody; but even that I never expected.’
“Question: ‘You did not expect that. Did you expect a possibility of a mobilization and concentration of economic forces in the event of war?’
“Answer: ‘In the event of an attack against Germany, certainly.’
“Question: ‘Now, putting your mind back to 1937, are you able to say what sort of an attack you were concerned with?’
“Answer: ‘I do not know, Sir.’
“Question: ‘Did you have thoughts on that at the time?’
“Answer: ‘No, never.’
“Question: ‘Did you then consider that the contingency of war in 1937 was so remote as to be negligible?’
“Answer: ‘Yes.’
“Question: ‘You did?’
“Answer: ‘Yes.’” (Document Number 3728-PS)
Did you give those answers?
SCHACHT: I have made exactly the same statements as found in this interrogation, here before the Tribunal.
MR. JUSTICE JACKSON: Now, you testified that you tried to divert Hitler’s plan which was to move and expand to the East—you tried to divert his attention to colonies instead.
SCHACHT: Yes.
MR. JUSTICE JACKSON: What colonies? You have never specified.
SCHACHT: Our colonies.
MR. JUSTICE JACKSON: And where were they located?
SCHACHT: I assume that you know that exactly as well as I do.
MR. JUSTICE JACKSON: You are the witness, Dr. Schacht. I want to know what you were telling Hitler, not what I know.
SCHACHT: Oh, what I told Hitler? I told Hitler we should try to get back a part of the colonies which belonged to us and the administration of which was taken away from us, so that we could work there.
MR. JUSTICE JACKSON: What colonies?
SCHACHT: I was thinking especially of the African colonies.
MR. JUSTICE JACKSON: And those African colonies you would regard as essential to your plan for the future of Germany?
SCHACHT: Not those, but generally any colonial activity; and of course, at first, I could only limit my colonial desires to our own property.
MR. JUSTICE JACKSON: And your property, as you call it, was the African colonies?
SCHACHT: Not I personally called them that. That is what the Treaty of Versailles calls them—“our property.”
MR. JUSTICE JACKSON: Any way you wish it, you wanted the colonies you are talking about.
SCHACHT: Yes.
MR. JUSTICE JACKSON: You considered that the possession and exploitation of colonies was necessary to the sort of Germany that you had in mind creating?
SCHACHT: If you would replace the word “exploitation” by “development,” I believe there will be no misunderstanding, and to that extent I agree with you completely.
MR. JUSTICE JACKSON: Well, by “development” you mean trading, and I suppose you expected to make a profit out of trade?
SCHACHT: No, not only “trade” but “developing the natural resources” or the economic possibilities of the colonies.
MR. JUSTICE JACKSON: And it was your proposal that Germany should become reliant upon those colonies instead of relying on expansion to the East?
SCHACHT: I considered every kind of expansion within the European continent as sheer folly.
MR. JUSTICE JACKSON: But you agreed with Hitler that expansion, either colonial or to the East, was a necessary condition of the kind of Germany you wanted to create.
SCHACHT: No, that I never said. I told him it was nonsense to undertake anything toward the East. Only colonial development could be considered.
MR. JUSTICE JACKSON: And you proposed as a matter of policy that Germany’s development should depend on colonies with which there was no overland trade route to Germany and which, as you knew, would require a naval power to protect them.
SCHACHT: I do not think that at all—how do you get that idea?
MR. JUSTICE JACKSON: Well, you do not get to Africa overland, do you? You have to go by water at some point, do you not?
SCHACHT: You can go by air.
MR. JUSTICE JACKSON: What was your trade route? You were thinking only of air developments?
SCHACHT: No, no. I thought of ships also.
MR. JUSTICE JACKSON: Yes. And Germany was not then a naval power?
SCHACHT: I believe we had a merchant marine which was quite considerable.
MR. JUSTICE JACKSON: Did your colonial plan involve rearmament by way of making Germany a naval power to protect the trade routes to the colonies that you were proposing?
SCHACHT: Not in the least.
MR. JUSTICE JACKSON: Then your plan was to leave the trade route unprotected?
SCHACHT: Oh, no. I believed that international law would be sufficient protection.
MR. JUSTICE JACKSON: Well, that is what you disagreed with Hitler about.
SCHACHT: We never spoke about that.
MR. JUSTICE JACKSON: Well, in any event he rejected your plan for colonial developments?
SCHACHT: Oh, no. I have explained here that upon my urgent request he gave me the order in summer 1936 to take up these colonial matters.
MR. JUSTICE JACKSON: Did you not give these answers in your interrogation, Dr. Schacht?
“Question: ‘In other words, at the time of your talks with Hitler in 1931 and 1932 concerning colonial policy, you did not find him, shall we say, enthusiastic about the possibility?’
“Answer: ‘Neither enthusiastic nor very much interested.’
“Question: ‘But he expressed to you what his views were alternatively to the possibility of obtaining colonies?’
“Answer: ‘No, we did not go into other alternatives.’”
Did you give those answers?
SCHACHT: Certainly.
MR. JUSTICE JACKSON: Now, after the Fritsch affair, at least, you knew that Hitler was not intent upon preserving the peace of Europe by all possible means.
SCHACHT: Yes, I had my doubts.
MR. JUSTICE JACKSON: And after the Austrian Anschluss you knew that the Wehrmacht was an important factor in his Eastern policy?
SCHACHT: Well, you may express it that way. I do not know exactly what you mean by it.
MR. JUSTICE JACKSON: Well, do not answer anything if you do not know what I mean, because we will make it clear as we go along. Except for the suggestion of colonies you proposed no other alternative to his plan of expansion to the East?
SCHACHT: No.
MR. JUSTICE JACKSON: Never at any Cabinet meeting or elsewhere did you propose any other alternative?
SCHACHT: No.
MR. JUSTICE JACKSON: Now, as to the move into Austria, I think you gave these answers:
“Question: ‘Actually Hitler did not use the precise method that you say you favored?’
“Answer: ‘Not at all.’
“Question: ‘Did you favor the method that he did employ?’
“Answer: ‘Not at all, Sir.’
“Question: ‘What was there in his method that you did not like?’
“Answer: ‘Oh, it was simply overrunning, just taking the Austrians over the head—or what do you call it? It was force, and I have never been in favor of such force.’”
Did you give those answers?
SCHACHT: Yes.
MR. JUSTICE JACKSON: Now, you have made considerable complaint here that foreigners did not come to your support at various times in your efforts to block Hitler, have you not?
SCHACHT: Certainly.
MR. JUSTICE JACKSON: You knew at the time of the Austrian Anschluss the attitude of the United States towards the Nazi regime, as expressed by President Roosevelt, did you not?
SCHACHT: Yes.
MR. JUSTICE JACKSON: And you knew of his speech suggesting that the Nazi menace ought to be quarantined to prevent its spread?
SCHACHT: I do not remember; but I certainly must have read it at that time, if it was published in Germany, as I assume it was.
MR. JUSTICE JACKSON: Goebbels let loose a campaign of attack on the President as a result of it, did he not?
SCHACHT: I assume I read that.
MR. JUSTICE JACKSON: As a matter of fact, you joined in the attack on foreigners who were criticizing the methods, did you not?
SCHACHT: When and where? What attacks?
MR. JUSTICE JACKSON: All right. After the Austrian Anschluss, when force was used, with your disapproval, you immediately went in and took over the Austrian National Bank, did you not?
SCHACHT: That was my duty.
MR. JUSTICE JACKSON: Yes. Well, you did it.
SCHACHT: Of course.
MR. JUSTICE JACKSON: And you liquidated it for the account of the Reich.
SCHACHT: Not liquidated; I merged it, amalgamated it.
MR. JUSTICE JACKSON: I beg your pardon?
SCHACHT: Amalgamated.
MR. JUSTICE JACKSON: Amalgamated it. And you took over the personnel?
SCHACHT: Everything.
MR. JUSTICE JACKSON: Yes. And the decree doing so was signed by you.
SCHACHT: Certainly.
MR. JUSTICE JACKSON: Yes. And you called the employees together on 21 March 1938.
SCHACHT: Yes.
MR. JUSTICE JACKSON: And made a speech to them.
SCHACHT: Yes.
MR. JUSTICE JACKSON: And did you say the following among other things...
SCHACHT: Certainly.
MR. JUSTICE JACKSON: Well, you have not heard it yet.
SCHACHT: Yes, I heard it during the case of the Prosecution.
MR. JUSTICE JACKSON: Well, I would like to quote some of it to you and remind you of it.
“I think it is quite useful if we recall these things to our mind in order to expose all the sanctimonious hypocrisy exuding from the foreign press. Thank God, these things could after all not hinder the great German people on their way, for Adolf Hitler has created a communion of German will and German thought. He has bolstered it up with the newly strengthened Wehrmacht, and he has thereby given the external aspect to the inner union between Germany and Austria.
“I am known for sometimes expressing thoughts which give offense; nor would I care to depart from this custom today.”
“Hilarity” is noted at this point in your speech.
“I know that there are even here in this country a few people—I believe they are not too numerous—who find fault with the events of the last few days. But nobody, I believe, doubts the goal; and it should be said to all hecklers that you cannot satisfy everybody. There are those who say they would have done it in some other way, perhaps, but strange to say they did not do it”—and in parentheses the word “hilarity” appears again. Continuing with your speech—“it was done by our Adolf Hitler (Long, continued applause); and if there is still something left to be improved, then those hecklers should try to bring about these improvements from within the German Reich and the German community and not disturb it from without.” (Document EC-297)
Did you use that language?
SCHACHT: Yes.
MR. JUSTICE JACKSON: In other words, you publicly ridiculed those who were complaining of the methods, did you not?
SCHACHT: If that is the way you see it.
MR. JUSTICE JACKSON: Then you also, in addressing the personnel of the Austrian National Bank, which you were taking over, said this:
“I consider it completely impossible that even a single person will find a future with us who is not wholeheartedly for Adolf Hitler. (Loud, continued applause; shouts of ‘Sieg Heil’).”
Continuing with the speech:
“Whoever does not do so had better withdraw from our circle of his own accord. (Loud applause).”
Is that what happened?
SCHACHT: Yes, they all agreed, surprisingly.
MR. JUSTICE JACKSON: Now, had the Reichsbank before 1933 and 1934 been a political institution?
SCHACHT: No.
MR. JUSTICE JACKSON: Had politics been in the Reichsbank?
SCHACHT: Never.
MR. JUSTICE JACKSON: Well, on this day, speaking to its employees, you said this, did you not?
“The Reichsbank will always be nothing but National Socialist, or I shall cease to be its manager. (Heavy, protracted applause).”
Did that happen?
SCHACHT: Yes.
MR. JUSTICE JACKSON: Now, Sir, you have said that you never took the oath to Hitler.
SCHACHT: Yes.
MR. JUSTICE JACKSON: I ask you if this is what you, as head of the Reichsbank, required of the employees whom you were taking over in Austria; and I quote:
“Now I shall ask you to rise. (The audience rises.) Today we pledge allegiance to the great Reichsbank family, to the great German community; we pledge allegiance to our newly arisen, powerful Greater German Reich, and we sum up all these sentiments in the allegiance to the man who has brought about all this transformation. I ask you to raise your hands and to repeat after me:
“I swear that I will be faithful and obedient to the Führer of the German Reich and the German people, Adolf Hitler, and will perform my duties conscientiously and selflessly. (The audience takes the pledge with uplifted hands.)
“You have taken this pledge. A bad fellow he who breaks it. To our Führer a triple ‘Sieg Heil’.”
Is that a correct representation of what took place?
SCHACHT: The oath is the prescribed civil service oath and it is quite in accordance with what I said here yesterday, that the oath is made to the head of the state just as I have stated before too: “We stand united before the German people”—I do not know exactly what the German expression is. I hear your English version here. That oath is exactly the same.
MR. JUSTICE JACKSON: I have referred to Document EC-297, Exhibit USA-632, in the course of this. That is the exhibit I have been using.
So you say that was to an impersonal head of state and not to Adolf Hitler?
SCHACHT: Yes. One obviously cannot take an oath to an idea. Therefore, one has to use a person. But I said yesterday that I did not take an oath to Herr Ebert or to Herr Hindenburg or to the Kaiser, but to the head of State as representative of the people.
MR. JUSTICE JACKSON: You told your employees that all of the sentiments of this oath were summed up in the allegiance to the man, did you not?
SCHACHT: No.
MR. JUSTICE JACKSON: Is that not what you said?
SCHACHT: No, that is not correct. If you read it again, it does not say to the man but to the leader as the head of State.
MR. JUSTICE JACKSON: Well, no matter what you took the oath to...
SCHACHT: [Interposing.] Excuse me. There is a very great difference.
MR. JUSTICE JACKSON: Well, we will get to that. Whatever you took the oath to, you were breaking it at the very time, were you not?
SCHACHT: No. I never broke the oath to this man as representative of the German people, but I broke my oath when I found out that that man was a criminal.
MR. JUSTICE JACKSON: When you plotted to cause his death?
SCHACHT: Yes.
MR. JUSTICE JACKSON: Do you want to explain to the Tribunal how you could cause the death of Adolf Hitler without also causing the death of the head of the German State?
SCHACHT: There is no difference because unfortunately that man was the head of the German nation.
MR. JUSTICE JACKSON: You say you never broke the oath?
SCHACHT: I do not know what you want to express by that. Certainly I did not keep the oath which I took to Hitler because Hitler unfortunately was a criminal, a perjurer, and there was no true head of State. I do not know what you mean by “breaking the oath,” but I did not keep my oath to him and I am proud of it.
MR. JUSTICE JACKSON: So you were administering to your employees an oath which you at that moment were breaking and intended to break?
SCHACHT: Again you confuse different periods of time, Mr. Justice. That was in March 1938 when as you have heard me say before, I still was in doubt, and therefore it was not clear to me yet what kind of a man Hitler was. Only when in the course of 1938 I observed that Hitler was possibly walking into a war, did I break the oath.
MR. JUSTICE JACKSON: When did you find him walking into a war?
SCHACHT: In the course of 1938 when, judging from the events, I gradually became convinced that Hitler might steer into a war, that is to say, intentionally. Then only did I break my oath.
MR. JUSTICE JACKSON: Well, you stated yesterday that you started to sabotage the government in 1936 and 1937.
SCHACHT: Yes, because I did not want excessive armament.
MR. JUSTICE JACKSON: And we find you administering an oath to the employees to be faithful and obedient.
Now, I ask you if you did not make this statement in interrogation:
“Question: ‘But you make this statement at the end of the oath, after everybody has raised his hand and made his oath. Did you say the following, “You have taken this pledge. A bad fellow he who breaks it”?’
“Answer: ‘Yes, I agree to that and I must say that I myself broke it.’
“Question: ‘Do you also say that at the time that you urged this upon the audience, that you already were breaking it?’
“Answer: ‘I am sorry to say that within my soul I felt very shaken in my loyalty already at that time, but I hoped that things would turn out well at the end.’”
SCHACHT: I am glad that you quote this because it confirms exactly what I have just said; that I was in a state of doubt and that I still had hope that everything would come out all right; that is to say, that Hitler would develop in the right direction. So it confirms exactly what I have just said.
MR. JUSTICE JACKSON: Well, I am sure we want to be helpful to each other, Dr. Schacht.
SCHACHT: I am convinced that both of us are trying to find the truth, Mr. Justice.
MR. JUSTICE JACKSON: Now, you remained in the Reichsbank after this Anschluss, of course?
SCHACHT: Yes.
MR. JUSTICE JACKSON: And you remained there until later—until January 1939, if that is the date?
SCHACHT: Yes.
MR. JUSTICE JACKSON: Now, after this Anschluss, the mefo bills which had been issued began to become due, did they not, in 1938 and 1939?
SCHACHT: No, the maturity date of the first mefo bills must have been at the earliest in the spring of 1939. They had all been issued for 5 years and I assume that the first mefo bills were issued in the spring of 1934, so that the first mefo bills became due in the spring of 1939.
MR. JUSTICE JACKSON: Now, this is the question and the answer. Correct me if I am wrong.
“Question: ‘Well, did you in the Reichsbank utilize funds which were available? Let me put it this way: As these mefo bills became due, what did you do about them?’
“Answer: ‘I asked the Minister of Finance whether he could repay them, because after 5 years he had to repay them, some in 1938 or 1939, I think. The first mefo bills would have become due for repayment and of course he said, “I cannot.”’”
You had that conversation with the Finance Minister while you were still President of the Reichsbank?
SCHACHT: Mr. Justice, I said that throughout our financial dealings we became somewhat worried as to whether we would get our bills paid back or not. I have already explained to the Tribunal that in the second half of 1938 the Finance Minister got into difficulties and he came to me in order again to borrow money. Thereupon I said to him, “Listen, in what kind of a situation are you anyway for you will soon have to repay the first mefo bills to us. Are you not prepared for that?” And now it turned out, that was in the fall of 1938, that the Reich Finance Minister had done nothing whatever to fulfill his obligation to meet payment of the mefo bills; and that, of course, in the fall of 1938, made for exceedingly strained relations with the Reich Finance Minister, that is, between the Reichsbank and the Reich Finance Minister.
MR. JUSTICE JACKSON: Now, taxes did not yield any sufficient revenue to discharge those bills, did they?
SCHACHT: Yes; I explained already yesterday that the risk which was taken in the mefo bills, which I have admitted from the very beginning, was not really a risk if a reasonable financial policy were followed; that is, if from 1938 on, further armament had not continued and additional foolish expenditures not been made, but if instead, the money accruing from taxes and bonds had been used for meeting the payment of the mefo bills.
MR. JUSTICE JACKSON: All I am asking you at the present moment, Dr. Schacht, is whether these bills could not have been paid out of the revenue from taxes.
SCHACHT: Surely. Yes.
MR. JUSTICE JACKSON: They could have?
SCHACHT: Of course, but that was the surprising thing, they were not repaid; the money was used to continue rearming. May I add something in order to give you further information?
MR. JUSTICE JACKSON: No, I am really not concerned with the financing; I am merely concerned with what kind of a mess you were in at the time you resigned.
SCHACHT: Yes.
MR. JUSTICE JACKSON: The mefo bills were due and could not be paid?
SCHACHT: Shortly.
MR. JUSTICE JACKSON: They were shortly to mature?
SCHACHT: Yes, but they could be paid. That is a mistake if you say that they could not be paid.
MR. JUSTICE JACKSON: Well, they could not be paid out of the current year’s taxes, could they?
SCHACHT: Yes, indeed. You are not interested and do not want me to tell you, but I am quite ready to explain it.
MR. JUSTICE JACKSON: Well, you have explained it pretty well to us.
SCHACHT: You have just told me you were not interested.
MR. JUSTICE JACKSON: Your subscriptions to the Fourth Reich Loan of 1938 had produced unsatisfactory results, had they not?
SCHACHT: They were hardly pleasing. The capital market was not good.
MR. JUSTICE JACKSON: And you have reported on the loan that there had been a shortage in the public subscription? And the result had been unsatisfactory?
SCHACHT: Yes.
MR. JUSTICE JACKSON: Now, did you not make this answer to the interrogator’s question:
“Question: ‘But I am asking you whether during that period from 1 April 1938 to January 1939 you did not continue to finance armaments?’
“Answer: ‘Sir, otherwise these mefo bills had to be refunded by the Reich, which they could not be, because the Reich had no money to do it; and I could not procure any money for refunding because that would have had to come from taxes or loans. So I had to continue to carry these mefo bills and that, of course, I did.’”
Did you give that answer?
SCHACHT: Yes, that was quite in order—kindly let me speak, would you not—because the Finance Minister did not make his funds available for the repayment of the mefo bills, but instead gave them for armaments. If he had used these funds to pay the mefo bills, everything would have been all right.
MR. JUSTICE JACKSON: And you carried the mefo bills which let him use current revenues to continue the plans of rearmament after 1938, did you not?
SCHACHT: Mr. Justice, this was the situation. A large part of the mefo bills was already on the financial and capital market. Now, when that market was too heavily burdened by the government, then the people brought in the mefo bills to the Reichsbank, for the Reichsbank had promised to accept them. That, precisely, was the great obstruction to my policy. The Reich Finance Minister financed the armament instead of honoring the mefo bills as he had promised.
MR. JUSTICE JACKSON: Now, it was under those circumstances that you took a position which would result in your retirement from the Reichsbank?
SCHACHT: Yes.
MR. JUSTICE JACKSON: Now we come to Czechoslovakia. Did you favor the policy of acquiring the Sudetenland by threat of resort to arms?
SCHACHT: Not at all.
MR. JUSTICE JACKSON: I think you characterized the manner in which the Sudetenland was acquired as wrong and reprehensible.
SCHACHT: I do not know when I could have done that. I said that the Allies, by their policy, gave the Sudetenland to Hitler, whereas I always had expected only that the Sudeten Germans would be given autonomy.
MR. JUSTICE JACKSON: Then you approved of Hitler’s policy in handling the Sudetenland situation? Is that what you want to be understood as saying?
SCHACHT: I never knew that Hitler, beyond autonomy, demanded anything else.
MR. JUSTICE JACKSON: Your only criticism of the Czechoslovakian situation relates to the Allies, as I understand you?
SCHACHT: Well, it also applies to the Czechs, maybe to the Germans too; for goodness sake, I do not want to play the judge here.
MR. JUSTICE JACKSON: Well, now on 16 October 1945, in Exhibit USA-636, Document 3728-PS, I ask if you did not make these replies to questions:
“Question: ‘Now, I am coming back to the march against Czechoslovakia which resulted in the appeasement policy, Munich, and the cession of the Sudetenland to the Reich.’
“Answer: ‘Yes.’
“Question: ‘Did you at that time favor the policy of acquiring the Sudetenland?’
“Answer: ‘No.’
“Question: ‘Did you favor at that time the policy of threatening or menacing the Czechs by force of arms so as to acquire the Sudetenland?’
“Answer: ‘No, certainly not.’
“Question: ‘Then I ask you, did it strike you at that time, did it come to your consciousness, that the means which Hitler was using for threatening the Czechs was the Wehrmacht and the armament industry?’
“Answer: ‘He could not have done it without the Wehrmacht.’”
Did you give those answers?
SCHACHT: Yes.
MR. JUSTICE JACKSON: Continuing:
“Question: ‘Did you consider the manner in which he handled the Sudeten question wrong or reprehensible?’
“Answer: ‘Yes.’
“Question: ‘You did?’
“Answer: ‘Yes, Sir.’
“Question: ‘And did you have a feeling at that time, looking back on the events that had proceeded and in your own participation in them, that this army which he was using as a threat against Czechoslovakia was at least in part an army of your own creation? Did that ever strike you?’
“Answer: ‘I cannot deny that, Sir.’”
SCHACHT: Certainly not.
MR. JUSTICE JACKSON: But here again, you turned in to help Hitler, once he had been successful with it, did you not?
SCHACHT: How can you say such a thing? I certainly did not know that Hitler would use the army in order to threaten other nations.
MR. JUSTICE JACKSON: After he had done it, you turned in and took over the Czech bank, did you not?
SCHACHT: Of course.
MR. JUSTICE JACKSON: Yes. You followed to clean up economically just so far as Hitler got the territory, did you not?
SCHACHT: But I beg your pardon. He did not take it with violence at all. The Allies presented him with the country. The whole thing was settled peacefully.
MR. JUSTICE JACKSON: Well, we have your testimony on the part the Wehrmacht played in it and what part you played in the Wehrmacht.
SCHACHT: Yes, I have never denied that.
MR. JUSTICE JACKSON: No. What I mean is this, referring to your interrogation of 17 October (Exhibit US-616):
“Question: ‘Now, after the Sudetenland was taken over by the Munich agreement, did you, as the President of the Reichsbank, do anything about the Sudeten territory?’
“Answer: ‘I think we took over the affiliations of the Czech Bank of Issue.’
“Question: ‘And you also arranged for the currency conversion, did you not?’
“Answer: ‘Yes.’”
That is what you did after this wrong and reprehensible act had been committed by Hitler, did you not?
SCHACHT: It is no “wrong and reprehensible” act “committed” by Hitler, but Hitler received the Sudeten German territory by way of treaty and, of course, the currency and the institute which directed financing had to be amalgamated with this field in Germany. There can be no talk of injustice. I cannot believe that the Allies have put their signature to a piece of injustice.
MR. JUSTICE JACKSON: So you think that everything up to Munich was all right?
SCHACHT: No. I am certainly of a different opinion. There was much injustice.
MR. JUSTICE JACKSON: Were you in this Court when Göring testified to his threat to bomb Prague—“the beautiful city of Prague”?
SCHACHT: Thanks to your invitation, I was here.
MR. JUSTICE JACKSON: Yes. I suppose you approved that use of the force which you had created in the Wehrmacht?
SCHACHT: Disapproved; disapproved under all circumstances.
MR. JUSTICE JACKSON: You did not think that was right dealing, then?
SCHACHT: No, no, that was an atrocious thing.
MR. JUSTICE JACKSON: Well, we have found something we agree on, Doctor. You knew of the invasion of Poland?
SCHACHT: Yes.
MR. JUSTICE JACKSON: You regarded it as an unqualified act of aggression on Hitler’s part, did you not?
SCHACHT: Absolutely.
MR. JUSTICE JACKSON: The same was true of the invasion of Luxembourg, was it not?
SCHACHT: Absolutely.
MR. JUSTICE JACKSON: And of Holland?
SCHACHT: Absolutely.
MR. JUSTICE JACKSON: And of Denmark?
SCHACHT: Absolutely.
MR. JUSTICE JACKSON: And of Norway?
SCHACHT: Absolutely.
MR. JUSTICE JACKSON: And of Yugoslavia?
SCHACHT: Absolutely.
MR. JUSTICE JACKSON: And of Russia?
SCHACHT: Absolutely, sir; and you have left out Norway and Belgium.
MR. JUSTICE JACKSON: Yes; well, I got to the end of my paper. The entire course was a course of aggression?
SCHACHT: Absolutely to be condemned.
MR. JUSTICE JACKSON: And the success of that aggression at every step was due to the Wehrmacht which you had so much to do with creating?
SCHACHT: Unfortunately.
MR. JUSTICE JACKSON: Now, I intend to take up another subject and perhaps it would be ... it is almost recess time.
THE PRESIDENT: We will adjourn now.
[A recess was taken.]
MARSHAL (Colonel Charles W. Mays): If it pleases the Tribunal, the report is made that Defendant Von Neurath is absent.
MR. JUSTICE JACKSON: Dr. Schacht, in your direct testimony you made reference to a film, which was taken and exhibited in Germany for propaganda purposes, of your demeanor on the occasion of Hitler’s return after the fall of France.
SCHACHT: May I correct that? Not I, but my counsel, spoke of this film; and it was not mentioned that it was used for propaganda purposes. My counsel merely said that it had been run in a newsreel, so it probably was shown for about one week.
MR. JUSTICE JACKSON: I will ask to exhibit that film to the Tribunal. It is a very brief film, and the movement in it is very rapid. There is very little of translation involved in it, but the speed of it is such that for myself I had to see it twice in order to really see what it is.
THE PRESIDENT: Do you want to put it on now?
MR. JUSTICE JACKSON: I would like to put it on now. It will take only a moment, and Dr. Schacht should be placed where he can see it for I want to ask him some questions and [Turning to the defendant] particularly I may ask you to identify the persons in it.
I will ask, if I may, to have it shown twice, so that after all has been seen you can once more see it.
THE PRESIDENT: Certainly.
[Moving pictures were then shown.]
MR. JUSTICE JACKSON: I think that I, in mentioning this exhibit which I wish to offer in evidence, spoke of it as a “propaganda film.” That was not the language of Dr. Dix. Dr. Dix described it as a “weekly newsreel” and as a “weekly film.”
[Turning to the defendant.] While our memory is fresh about that, will you tell the Court as many of the defendants as you recognized present in that picture?
SCHACHT: In glancing at it quickly I could not see exactly who was there. However, I should assume that almost all were present—I say that from memory, not from the film—either in Hitler’s retinue or among those who received him.
MR. JUSTICE JACKSON: While you were still President of the Reichsbank and after the action in taking over the Czechoslovakian Bank you made a speech, did you not, on 29 November 1938?
SCHACHT: Yes.
MR. JUSTICE JACKSON: It is Document EC-611, Exhibit USA-622. I am advised that the film became Exhibit USA-835, and before I pass from it I would like to offer the statement as to the personality of Hermann Göring, which is Document 3936-PS, as Exhibit USA-836.
[Turning to the defendant.] In this speech of 29 November 1938, Dr. Schacht, if I am correctly informed—and by the way, it was a public speech was it not?
SCHACHT: Inasmuch as it was made before the German Academy. It was entirely public, and if it passed the censorship it certainly was also mentioned in the papers. It was public; anyone could hear it.
MR. JUSTICE JACKSON: You used this language, did you not?:
“It is possible that no bank of issue in peace times has carried on such a daring credit policy as has the Reichsbank since the seizure of power by National Socialism. With the aid of this credit policy, however, Germany has created an armament second to none, and this armament in turn has made possible our political successes.” (Document EC-611)
Is that correct?
SCHACHT: That is absolutely correct, and—would you please mind letting me talk in the future? That is correct and I was very much surprised that it was necessary to do this in order to create justice in the world.
MR. JUSTICE JACKSON: The taking over of Czechoslovakia representing your idea of justice?
SCHACHT: I have already told you that Germany did not “take over Czechoslovakia,” but that it was indeed presented to Germany by the Allies on a silver platter.
MR. JUSTICE JACKSON: Are you now saying that that was an act of justice, or are you condemning it? I cannot get your position, Doctor. Just tell us, were you for it? Are you today for it, or against it?
SCHACHT: Against what? Will you please tell me against what and for what?
MR. JUSTICE JACKSON: Against the taking over of the Sudetenland by the method by which it was done.
SCHACHT: I cannot answer your question for the reason that, as I said, it was no “taking over,” but was a present. If someone gives me a present, such as this, I accept it gratefully.
MR. JUSTICE JACKSON: Even though it does not belong to them to give?
SCHACHT: Well, that I must naturally leave up to the donor.
MR. JUSTICE JACKSON: And although it was taken at the point of a gun, you still would accept the gift?
SCHACHT: No, it was not taken “at the point of a gun.”
MR. JUSTICE JACKSON: Well, we will pass on to your speech. Did you say also:
“Instead of a weak and vacillating government a single, purposeful, energetic personality is ruling today. That is the great miracle which has happened in Germany and which has had its effect in all fields of life and not last in that of economy and finance. There is no German financial miracle. There is only the miracle of the reawakening of German national consciousness and German discipline, and we owe this miracle to our Führer, Adolf Hitler.” (Document EC-611)
Did you say that?
SCHACHT: Certainly. That was what I was so greatly astonished at.
MR. JUSTICE JACKSON: As Minister without Portfolio, what did your Ministry consist of?
SCHACHT: Nothing.
MR. JUSTICE JACKSON: What employees did you have?
SCHACHT: One female secretary.
MR. JUSTICE JACKSON: What space did you occupy?
SCHACHT: Two or three rooms in my own apartment which I had furnished as office rooms.
MR. JUSTICE JACKSON: So the government did not even furnish you an office?
SCHACHT: Yes, they paid me a rental for those rooms.
MR. JUSTICE JACKSON: Oh, and whom did you meet with as Minister without Portfolio?
SCHACHT: I do not understand. Whom I met with?
MR. JUSTICE JACKSON: Well, did you have any meetings? Did you have any official meetings to attend?
SCHACHT: I have stated here repeatedly that, after my retirement from the Reichsbank, I never had a single meeting or conference, official or otherwise.
MR. JUSTICE JACKSON: Did anybody report to you, or did you report to anybody?
SCHACHT: No, no one reported to me, nor did I report to anyone else.
MR. JUSTICE JACKSON: Then I take it that you had no duties whatever in this position?
SCHACHT: Absolutely correct.
MR. JUSTICE JACKSON: And you were Minister without Portfolio, however, at the time that Hitler came back from France, and you attended the reception for him at the railway station? And went to the Reichstag to hear his speech?
SCHACHT: Yes.
MR. JUSTICE JACKSON: Now, notwithstanding your removal as President of the Reichsbank, the government continued to pay you your full salary until the end of 1942, did it not?
SCHACHT: I stated yesterday that that is not correct. I received my salary from the Reichsbank, which was due to me by contract, but a minister’s salary was not paid to me. I believe that as Minister I received certain allowances to cover expenses, I cannot say that at the moment; but I did not receive a salary as a Minister.
MR. JUSTICE JACKSON: Well, I will return to your interrogation of 9 October 1945 and ask you whether you gave these answers to these questions on that interrogation:
“Question: ‘What salary did you receive as Minister without Portfolio?’
“Answer: ‘I could not tell you exactly. I think it was some 24,000 marks, or 20,000 marks. I cannot tell you exactly, but it was accounted on the salary and afterward on the pension which I got from the Reichsbank, so I was not paid twice. I was not paid twice.’
“Question: ‘In other words, the salary that you received as Minister without Portfolio during the period you were also President of the Reichsbank was deducted from the Reichsbank?’
“Answer: ‘Yes.’
“Question: ‘However, after you severed your connection with the Reichsbank in January 1939, did you then receive the whole salary?’
“Answer: ‘I got the whole salary because my contract ran until the end of June 1942, I think.’
“Question: ‘So you received a full salary until the end of June 1942?’
“Answer: ‘Full salary and no extra salary, but from the 1st of July 1942 I got my pension from the Reichsbank, and again the salary of the Ministry was deducted from that, or vice versa. What was higher, I do not know; I got a pension of about 30,000 marks from the Reichsbank.’”
And on 11 July 1945, at Ruskin, you were questioned and gave answers as follows:
“Question: ‘What was the date of your contract?’
“Answer: ‘From 8 March 1939, 1940, 1941, 1942. Four years. Four years’ contract.’
“Question: ‘You were really then given a four-year appointment?’
“Answer: ‘That is what I told you. After 1942 I got a pension from the Reichsbank.’
“Question: ‘What was the amount of your salary and all other income from the Reichsbank?’
“Answer: ‘All the income from the Reichsbank, including my fees for representation, amounted to 60,000 marks a year, and the pension is 24,000. You see, I had a short contract but a high pension. As Reich Minister without Portfolio, I had another, I think also 20,000 or 24,000 marks.’”
Now, is that correct?
SCHACHT: The salaries are stated on paper and are correctly cited here and I have indeed claimed that I was paid by one source only. I was asked, “What salary did you receive as Reich Minister?” I stated the amount, but I did not receive it, as it was merely deducted from my Reichsbank salary. And the pension, as I see here, is quoted wrongly in one case. I believe I had only 24,000 marks’ pension, while it says here somewhere that it was 30,000 marks. In my own money affairs I am somewhat less exact than in my official money affairs. However, I was paid only once, and that is mainly by the Reichsbank up to—and that also has not been stated here correctly. It was not the end of 1942, but the end of June 1942, that my contract expired. Then the pension began and it too was paid only once. How those two, that is, the Ministry and Reichsbank, arranged it with each other is unknown to me.
MR. JUSTICE JACKSON: Well, you were entitled to a salary and a pension both, and one was offset against the other; is that what you mean? And that arrangement continued as long as you were a part of the regime?
SCHACHT: It is still in effect today. It has nothing to do with the regime. I hope that I shall still receive my pension; how else should I pay my expenses?
MR. JUSTICE JACKSON: Well, they may not be very heavy, Doctor.
When General Beck resigned, he asked you to resign, did he not?
THE PRESIDENT: Just a minute; it is quite unnecessary for anyone present in Court to show his amusement by laughter.
MR. JUSTICE JACKSON: Were you asked to resign when General Beck resigned?
SCHACHT: No, he did not say that.
MR. JUSTICE JACKSON: Have you in mind the testimony given by Gisevius here?
SCHACHT: Yes. It was a mistake on the part of Gisevius.
MR. JUSTICE JACKSON: Oh, well, in any event, when General Beck resigned, it was called sharply to your attention?
SCHACHT: He paid me a visit and told me about it a few days before his retirement. I assume that was about the end of August or the beginning of September of 1938.
MR. JUSTICE JACKSON: And you say that no proposal was made to you at that time that you should resign along with Beck?
SCHACHT: No, nothing was said about that. Beck saw me in my room; he did not mention anything of this sort, and it was not discussed by us.
MR. JUSTICE JACKSON: Did it ever occur to you that resignation would be the appropriate way of expressing your protest against these things which you now say you disapprove?
SCHACHT: No, I do not at all believe that a resignation would have been the means to achieve that which had to be done, and I also regretted it very much that Beck retired. That which happened, Mr. Justice, was caused by an entirely false policy—a policy that partly was forced upon us, and partly, I am sorry to say, was not handled properly by us. In February, Neurath was dismissed. In the fall Beck stepped out; in January 1939 I was dismissed. One after the other was gotten rid of. If it had been possible for our group—if I too may now speak of a group—to carry out a common action, as we hoped for and expected, then that would have been an excellent thing. However, these individual retirements served no purpose whatsoever; at least, they had no success.
MR. JUSTICE JACKSON: You felt that Beck should have stayed at his post and been disloyal to the head of the State?
SCHACHT: Absolutely.
MR. JUSTICE JACKSON: And, in all events, you continued in every public way throughout the period, until the fall of France, to hold yourself out as a part of the government and a part of the regime, did you not?
SCHACHT: Well, I never considered myself a part of the regime exactly, because I was against it. But, of course, ever since the fall of 1938 I worked towards my own retirement, as soon as I saw that Hitler did not stop the rearmament but continued it, and when I became aware that I was powerless to act against it.
MR. JUSTICE JACKSON: Well, when did you start working towards your own retirement?
SCHACHT: Pardon me; I did not understand—to work towards what?
MR. JUSTICE JACKSON: When did you start working towards your own retirement from office.
SCHACHT: After Munich and after we realized that we could no longer expect disarmament or a stopping of rearmament by Hitler and that we could not prevent a continuation of the rearmament; so, within the circles of the Reichsbank Directorate, we began to discuss this question and to realize that we could not follow the further course of rearmament. That was the last quarter of 1938.
MR. JUSTICE JACKSON: And all of these events of which you disapproved never were of sufficient consequence to cause you to resign and withhold a further use of your name from this regime?
SCHACHT: Until then I had still hoped that I could bring about a change for the better; consequently I accepted all the disadvantages entailed with my remaining in office, even facing the danger that some day I might be judged, as I am today.
MR. JUSTICE JACKSON: You continued to allow your name to be used at home and abroad despite your disapproval, as you say, of the invasion of Poland?
SCHACHT: I never was asked for my permission, and I never gave that permission.
MR. JUSTICE JACKSON: You knew perfectly well, did you not, that your name meant a great deal to this group at any time and that you were one of the only men in this group who had any standing abroad?
SCHACHT: The first part of your statement I already accepted yesterday from you as a compliment. The second part, I believe, is not correct. I believe that several other members of the regime also had a “standing” in foreign countries, some of whom are sitting with me here in the prisoners’ dock.
MR. JUSTICE JACKSON: Any foreign observer, who read affairs in Germany, would have obtained the understanding that you were supporting the regime continuously until you were deprived of the office of Minister without Portfolio, would they not?
SCHACHT: That is absolutely incorrect. As I have stated repeatedly yesterday and also during my direct examination, I was always referred to in foreign broadcasts as a man who was an opponent of this system, and all my numerous friends and acquaintances in foreign countries knew that I was against this system and worked against it. And if any journalist can be mentioned to me today who did not know this, then he does not know his business.
MR. JUSTICE JACKSON: Oh, do you refer to the letter which you wrote to the New York banker Leon...?
SCHACHT: Leon Fraser.
MR. JUSTICE JACKSON: Now, at the time you sent that letter to Switzerland, there was a diplomatic representative of the United States in Berlin, was there not?
SCHACHT: Yes.
MR. JUSTICE JACKSON: And you knew he had a pouch communication at least once a week and usually once a day with Washington?
SCHACHT: Yes, I did not know it, but I assumed it.
MR. JUSTICE JACKSON: And, if you wanted to communicate with the Government of the United States or with an official of the United States, you might have communicated through the regular channels?
SCHACHT: I did not desire to communicate with the American Government or with an American official. I merely desired to re-establish my connection with a friend who had invited me in January to come to the United States, and I made reference to this previous correspondence between him and me in January.
MR. JUSTICE JACKSON: That disposes of the Fraser matter then.
Now, Dr. Schacht, while you were Minister without Portfolio, aggressive wars were instituted, according to your testimony, against Poland, against Denmark and Norway in April of 1940, against Holland and Belgium in May of 1940; in June there was the French armistice and surrender; in September of 1940 there was the German-Japanese-Italian-Tripartite Pact; in April of 1941 there was an attack on Yugoslavia and Greece, which you say was aggressive; in June of 1941 there was the invasion of Soviet Russia, which you say was aggressive; on 7 December 1941 Japan attacked Pearl Harbor, and after the attack declared war on the United States; on 8 December 1941 the United States declared war on Japan, but not on Germany; on 11 December 1941, Germany and Italy declared war on the United States; and all of these things happened in the foreign field and you kept your position as Minister without Portfolio under the Hitler Government, did you not?
SCHACHT: Mr. Justice...
MR. JUSTICE JACKSON: Did you not and is that not a fact?
SCHACHT: Yes, and I wish to add something to this. From dozens of witnesses who have testified here, and from myself, you have heard again and again that it was impossible unilaterally to retire from this office because, if I was put in as a minister by the head of a government, I could also be retired only with his signature. You have also been told that at various times I attempted to rid myself of this ministerial office. Besides the witnesses’ testimony from countless others, including Americans, to the effect that it was well known that Hitler did not permit anyone to retire from office without his permission. And now you charge me with having remained. I did not remain for my pleasure, but I remained because I could not have retired from the Ministry without making a big row. And almost constantly, I should say, I tried to have this row until finally in January 1943 I succeeded; and I was able to disappear from office, not without danger to my life.
MR. JUSTICE JACKSON: Well, I will deal with your explanation later. I am now getting the facts.
You did not have an open break with Hitler, so that you were not entirely out of office until after the German offensive broke down in Russia and the German armies were in retreat and until after the Allies had landed in Africa, did you?
SCHACHT: The letter by which I brought about the last successful row is dated 30 November 1942. The row and its success dates from 21 January 1943, because Hitler and Göring and whoever else participated in discussing it, needed 7 weeks to make up their minds about the consequence of my letter.
MR. JUSTICE JACKSON: Then by your letter it plainly shows that you thought the ship was sinking, was it not; that means that the war was lost?
SCHACHT: My oral and written declarations from former times have already shown this. I have spoken here also about this. I have testified on the letter to Ribbentrop and Funk; I have presented a number of facts here which prove that I never believed in the possibility of a German victory. And my disappearance from office has nothing whatsoever to do with all these questions.
MR. JUSTICE JACKSON: Now, meanwhile, while you were remaining as Minister without Portfolio because you thought it might be dangerous to resign, you were encouraging the generals in the army to commit treason against the head of the State, were you not?
SCHACHT: Yes, and I should like now to make an additional statement to this. It was not because of threatening danger to my life that I could not resign earlier. For I was not afraid of endangering my life because I was used to that ever since 1937, having constantly been exposed to the arbitrariness of the Party and its heads.
Your question as to whether I tried to turn a number of generals to high treason, I answer in the affirmative.
MR. JUSTICE JACKSON: And you also tried to get assassins to assassinate Hitler, did you not?
SCHACHT: In 1938 when I made my first attempt, I was not thinking as yet of an assassination of Hitler. However, I must admit that later I said if it could not be done any other way, we would have to kill the man, if possible.
MR. JUSTICE JACKSON: Did you say, “We will have to kill him,” or did you say, “Somebody else will have to kill him,” Dr. Schacht?
SCHACHT: If I had had the opportunity I would have killed him, I myself. I beg you therefore not to summon me before a German court for attempted murder because in that sense I am, of course, guilty.
MR. JUSTICE JACKSON: Well, now, whatever your activities, they were never sufficiently open so that the foreign files in France, which you say were searched by the Gestapo, had an inkling of it, were they?
SCHACHT: Yes, I could not announce this matter in advance in the newspapers.
MR. JUSTICE JACKSON: And the Gestapo, with all its searching of you, never was in a position to put you under arrest until after the 20 July attack on Hitler’s life?
SCHACHT: They could have put me under arrest much earlier than that if they had been a little smarter; but that seems to be a strange attribute of any police force.
MR. JUSTICE JACKSON: And it was not until 1943 that the Hitler regime dismissed you? Until that time apparently they believed that you were doing them more good than harm?
SCHACHT: I do not know what they believed at that time, hence I ask you not to question me about that. You will have to ask somebody from the regime; you still have enough people here.
MR. JUSTICE JACKSON: You have now contended that you knew about the plot of 20 July on Hitler’s life?
SCHACHT: I knew about it.
MR. JUSTICE JACKSON: You knew that Gisevius says you did not know about it?
SCHACHT: I already stated yesterday that I was informed not only of Goerdeler’s efforts but that I was thoroughly informed by General Lindemann, and the evidence of Colonel Gronau has been read here. I also stated that I did not inform my friends about this, because there was a mutual agreement between us that we should not tell anyone anything which might bring him into an embarrassing situation in case he were tortured by the Gestapo.
MR. JUSTICE JACKSON: Do you recall that Gisevius said that there were only three civilians that knew about that plot which was carefully kept within military personnel?
SCHACHT: You see that even Gisevius was not informed on every detail. Naturally, he cannot testify to more than what he knew.
MR. JUSTICE JACKSON: And so, Dr. Schacht, we are to weigh your testimony in the light of the fact that you preferred, over a long period of time, a course of sabotage of your government’s policy by treason against the head of the State, rather than open resignation from his cabinet?
SCHACHT: You constantly refer to my resignation. I have told you and proven that no resignation was possible. Consequently your conclusion is wrong.
MR. JUSTICE JACKSON: All right! Now let us see. In your interrogation on 16 October 1945, Exhibit USA-636, some questions were asked you about the generals of the Army, and I ask you if you were not asked these questions and if you did not give these answers:
“Question: ‘I say, suppose you were Chief of the General Staff and Hitler decided to attack Austria, would you say you had the right to withdraw?’
“Answer: ‘I would have said, “Withdraw me, Sir.”’
“Question: ‘You would have said that?’
“Answer: ‘Yes.’
“Question: ‘So you take the position that any official could at any time withdraw if he thought that the moral obligation was such that he felt he could not go on?’
“Answer: ‘Quite.’
“Question: ‘In other words, you feel that the members of the General Staff of the Wehrmacht who were responsible for carrying into execution Hitler’s plan are equally guilty with him?’
“Answer: ‘That is a very hard question you put to me, Sir, and I answer, “yes”.’”
You gave those answers, did you not? Did you give those answers?
SCHACHT: Yes, and I should like to give an explanation of this, if the Tribunal permits it. If Hitler ever had given me an immoral order, I should have refused to execute it. That is what I said about the generals also, and I uphold this statement which you have just read.
MR. JUSTICE JACKSON: I am through with him, Your Honor, except that I would like to note the exhibit numbers. The petition to Hindenburg referred to yesterday is 3901-PS, and will become Exhibit USA-837. The Von Blomberg interrogation of October 1945 is Exhibit USA-838.
DR. HANS LATERNSER: (Counsel for General Staff and High Command of the German Armed Forces): Mr. President, I request that the statement of the Defendant Schacht insofar as it was cited and becomes part of the minutes be stricken from the record. The question, as I understood it, was whether he considered the General Staff to be just as guilty as Hitler. This question was answered in the affirmative by the Defendant Schacht in this examination. The question and the answer—the question to begin with is inadmissible and likewise the answer because a witness cannot pass judgment on this. That is the task of the Court. And for this reason I request that this testimony be stricken from the record.
MR. JUSTICE JACKSON: May it please the Tribunal, I do not, of course, offer this opinion of Schacht’s as evidence against the General Staff or against any individual soldier on trial. The evidence, I think, was as to the credibility of Schacht and as to his position. I do not think that his opinion regarding the guilt of anybody else would be evidence against that other person; I think that his opinion on this matter is evidence against himself in the matter of credibility.
THE PRESIDENT: Yes, Dr. Dix.
DR. RUDOLF DIX (Counsel for Defendant Schacht): The question by Justice Jackson was not whether Schacht considered the generals guilty, but the question was whether it was correct that Schacht, in an interrogation previous to the Trial, had given certain answers to certain questions. In other words, it was a question about an actual occurrence which took place in the past and not a question about an opinion or a judgment which he was to give here. As Schacht’s counsel, I am not interested in this passage being stricken from the record, except to the extent that these words remain: “I, Schacht, would never have executed an immoral order and an immoral demand by Hitler.” So far as the rest of this answer of Schacht is concerned I, as his defense counsel, declare that it is a matter of indifference to me.
DR. LATERNSER: Mr. President, after the declaration of Justice Jackson, I withdraw my objection.
MAJOR GENERAL G. A. ALEXANDROV (Assistant Prosecutor for the U.S.S.R.): Mr. President, may I begin my cross-examination?
THE PRESIDENT: Yes.
GEN. ALEXANDROV: Defendant Schacht, when answering the questions put to you by your counsel, you informed us of the circumstances under which you first became acquainted with Hitler and Göring. You even remembered a detail such as the pea soup with lard which was served for supper at Göring’s house.
What I am interested in now are some other particulars, rather more relevant to the case, of your relations with Hitler and Göring. Tell me, on whose initiative did your first meeting with Hitler and Göring take place?
SCHACHT: I have already stated that my friend, Bank Director Von Stauss, invited me to an evening in his home so that I might meet Göring there. The meeting with Hitler then took place when Göring asked me to come to his home—that is, Göring’s home—to meet Hitler.
GEN. ALEXANDROV: For what reasons did you, at that time, accept the invitation to meet Hitler and Göring?
SCHACHT: The National Socialist Party at that time was one of the strongest parties in the Reichstag with 108 seats, and the National Socialist movement throughout the country was extremely lively. Consequently, I was more or less interested in making the acquaintance of the leading men of this movement whom up to then I did not know at all.
GEN. ALEXANDROV: But you declared that you were invited by Göring himself. Why did Göring especially invite you?
SCHACHT: Please ask Herr Göring that.
GEN. ALEXANDROV: Did you not ask him yourself?
SCHACHT: Herr Göring wished me to meet Hitler, or Hitler to meet me.
GEN. ALEXANDROV: What for? With what aim in mind?
SCHACHT: That you must ask Herr Göring.
GEN, ALEXANDROV: Do you not think that Hitler and Göring intended—and not unsuccessfully at that—to inveigle you into participating in the fascist movement, knowing that in Germany you were an economist and financier of repute who shared their views?
SCHACHT: I was uninformed about the intentions of these two gentlemen at that time. However, I can imagine that it was just as much a matter of interest for these gentlemen to meet Herr Schacht as it was for me to meet Herr Hitler and Herr Göring.
GEN. ALEXANDROV: Then it was a matter of purely personal interest; or were other considerations involved, of a political nature? You yourself understood that your participation in the fascist movement would be of advantage to Hitler, inasmuch as you were a well-known man in your own country?
SCHACHT: As far as I was concerned, I was only interested in seeing what kind of people they were. What motives these two gentlemen had are unknown to me, as I have already stated. My collaboration in the fascist movement was entirely out of the question, and it was not given...
GEN. ALEXANDROV: Tell me, please...
SCHACHT: Please let me finish. My collaboration was not given before the July elections of 1932. As I have stated here, the acquaintance was made in January 1931, which was 1½ years before these elections. Throughout these 1½ years no collaboration took place.
GEN. ALEXANDROV: Tell me, was your acquaintance with Hitler and Göring exclusively limited to these meetings, or had you already met them before Hitler came into power?
SCHACHT: Until July 1932 I saw Hitler and Göring, each of them, perhaps once, twice, or three times—I cannot recall that in these 1½ years. But in any case there is no question of any frequent meetings.
GEN. ALEXANDROV: Then, how do you explain your letter to Hitler of 29 August 1932 in which you offered your services to Hitler? You remember this letter?
SCHACHT: Yes.
GEN. ALEXANDROV: How do you explain it?
SCHACHT: I have spoken about this repeatedly. Will you be so kind as to read it in the record?
GEN. ALEXANDROV: Please repeat it once more, briefly.
THE PRESIDENT: If he has been over it once, that is sufficient.
GEN. ALEXANDROV: When, and by whom were you first invited to participate in the future Hitlerite Government and promised the post of President of the Reichsbank?
SCHACHT: The President of the Reichsbank did not hold a position in the government, but was a high official outside the government. The first time that there was any talk in my presence about this post was on 30 January 1933, when I accidentally ran into Göring in the lobby of the Kaiserhof Hotel, and he said to me, “Ah, there comes our future President of the Reichsbank.”
GEN. ALEXANDROV: When answering the questions of your counsel, you declared that the fascist theory of race supremacy was sheer nonsense, that the fascist ideology was no ideology at all, that you were opposed to the solution of the Lebensraum problem by the seizure of new territories, that you were opposed to the Leadership Principle within the Fascist Party and even made a speech on this subject in the Academy of German Law, and that you were opposed to the fascist policy of exterminating the Jews.
Is this right? Did you say this when answering the questions put by your counsel?
SCHACHT: Yes, we both heard it here.
GEN. ALEXANDROV: Well, then tell me, what led you to fascism and to co-operation with Hitler?
SCHACHT: Nothing at all led me to fascism; I have never been a fascist.
GEN. ALEXANDROV: Then what induced you to co-operate with Hitler since you had adopted a negative attitude toward his theories and the theories of German fascism?
THE PRESIDENT: General Alexandrov, he has told us what he says led him to co-operate with Hitler. I think you must have heard him.
GEN. ALEXANDROV: But it did, in fact, take place?
[Turning to the defendant.] In reply to a question by your counsel as to why you did not emigrate, you stated that you did not wish to be a simple martyr. Tell me, did you not know the fate which befell Germany’s outstanding personalities, who held democratic and progressive ideas when Hitler came to power? Do you know that they were all exiled or sent to concentration camps?
SCHACHT: You are confusing things here. I did not answer that I did not want to be a martyr to the question of whether I wanted to emigrate; but I said, “Emigrants—that is, voluntary emigrants—never served their country,” and I did not want to save my own life, but I wanted to continue to work for the welfare of my country.
The martyr point was in connection with a question following, as to whether I expected any good to have resulted for my country if I had died as a martyr. To that I replied, “Martyrs serve their country only if their sacrifice becomes known.”
GEN. ALEXANDROV: You related it somewhat differently. I shall, nevertheless, repeat my question.
THE PRESIDENT: I would be very grateful if you would repeat this question.
GEN. ALEXANDROV: Do you know the fate which befell the foremost men of Germany, men who held progressive and democratic ideas when Hitler came to power? You know that all these people were either exiled or sent to concentration camps?
SCHACHT: I expressly stated here that when I spoke of emigrants I meant those who were in exile, who did not leave the country under compulsion but left voluntarily—those are the ones I was speaking about. The individual fates of the others are not known to me. If you ask me about individual persons, I will tell you regarding each one of these people, whether I know his fate or not.
GEN. ALEXANDROV: The fate of these great men is universally known. You, one of the few outstanding statesmen in democratic Germany, co-operated with Hitler. Do you admit this?
SCHACHT: No.
GEN. ALEXANDROV: You testified—and I am obliged to refer once again to the same question—that the entry in the Goebbels diary of 21 November 1932 was false. Once again I remind you of this entry which Goebbels wrote, and I quote:
“In a conversation with Dr. Schacht I found that he fully reflects our viewpoint. He is one of the few who fully agrees with the Führer’s position.”
Do you continue to say that this entry does not conform to reality?
This is the question which I am asking you.
SCHACHT: I have never claimed that this entry was false. I only claimed that Goebbels got this impression and he was in error about it.
GEN. ALEXANDROV: But according to your statement this entry does not conform to reality, to your attitude toward Hitler’s regime. Is that the case or not?
SCHACHT: In the general way in which Goebbels represents it there, it is wrong; it is not correct.
GEN. ALEXANDROV: Why did you not lodge a protest? After all, Goebbels’ diary, including this entry, was published.
SCHACHT: If I would have protested against all the inaccuracies which were printed about me, I would never have come to my senses.
GEN. ALEXANDROV: But do you not see, this is not exactly an ordinary excerpt from Goebbels’ diary—and he was rather an outstanding statesman in fascist Germany—for he describes your political views; and if you were not in agreement with him it would have been appropriate for you, in some way or other, to take a stand against it.
SCHACHT: Permit me to say something to this. Either you ask me—at any rate I should not like to have here a two-sided argument if it is only one-sided. I say that the diary of Goebbels is an unusually common piece of writing.
GEN. ALEXANDROV: The witness, Dr. Franz Reuter, your biographer and close friend, in his written affidavits of 6 February 1946, presented to the Tribunal by your counsel as Document Schacht-35, testified to the following: “Schacht joined Hitler in the early thirties and helped him to power...”
Do you consider these affidavits of the witness Dr. Franz Reuter as untrue, or do you confirm them?
SCHACHT: I consider them wrong.
GEN. ALEXANDROV: How far did you personally participate to help bring 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.
SCHACHT: 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 quite some time. As to finances and the industrial meetings of February 1933, that has profusely been gone into.
GEN. ALEXANDROV: What particular role did you play in this conference?
SCHACHT: This, too, has been discussed in detail. Please read about it in the record.
GEN. ALEXANDROV: I have already familiarized 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 4 June 1945. This is Document Number 2828-PS. I quote Defendant Funk’s testimony:
“I was at the meeting. Money was not demanded by Göring but by Schacht. Hitler left the room, then Schacht made a speech asking for money for the election. I was only there as an impartial observer, since I enjoyed a close friendship with the industrialists.”
Does this testimony of the Defendant Funk represent the truth?
SCHACHT: Herr Funk is in error. Document D-203 has been presented here to the Court by the Prosecution...
GEN. ALEXANDROV: But...
SCHACHT: Please do not interrupt me. The Prosecution has submitted this document, and this document shows that Göring directed the request for financial aid and not I.
GEN. ALEXANDROV: In this connection Defendant Funk declared that this speech was made by you and not by Göring. I ask you now, which statement represents the truth?
SCHACHT: I have just told you that Herr Funk is in error and that the evidence of the Prosecution is correct.
GEN. ALEXANDROV: Then what part did you play in connection with this conference?
SCHACHT: This, too, I have already stated in detail, I am...
THE PRESIDENT: The Tribunal has already heard a long cross-examination and it does not desire to hear the same facts or matters gone over again. 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-examination?
GEN. 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 30 or 40 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.
GEN. 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.
GEN. ALEXANDROV: Do you admit that, while acting as President of the Reichsbank and as Minister of Economics and Plenipotentiary for War Economy, you played a decisive part in preparing the rearmament of Germany and consequently, in preparing for a war of aggression?
SCHACHT: No, I categorically deny that.
GEN. ALEXANDROV: You were Plenipotentiary for War Economy?
SCHACHT: Well, we have spoken about that here ten times already.
GEN. ALEXANDROV: 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.
GEN. 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 Plenipotentiary for War Economy?
SCHACHT: I have just stated that I do not understand the question—for what duration? All this has certainly been stated here already.
THE PRESIDENT: We have got the date when he became Plenipotentiary for War Economy and the date when he ceased to be.
GEN. ALEXANDROV: I should like to remind you of the duties imposed on you as Plenipotentiary by the Reich Defense Act of 21 May 1935. I shall quote a brief excerpt from Section 2 of this law, entitled “Mobilization”:
“Point 1: For the purpose of directing the entire war economy the Führer and Reich Chancellor will appoint a Plenipotentiary for War Economy.
“Point 2: It will be the duty of the 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 Labor Minister, the Chief Reich Forester, and all other Reich officials directly subordinate to the Führer 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 Plenipotentiary for War Economy shall have the right to enact public laws within his official jurisdiction which may differ from existing laws.”
You admit that this law gave you extraordinary powers in the sphere of war economy?
SCHACHT: This document is before the Court and I assume that you have read it correctly.
GEN. ALEXANDROV: I am not asking you whether I have read this 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? Do you admit that?
SCHACHT: I had exactly the full powers which are described in the law.
GEN. ALEXANDROV: Do you admit that these were not ordinary powers, but quite extraordinary powers?
SCHACHT: No, I will not admit this at all.
GEN. ALEXANDROV: In other words, you considered that the Reich Defense Law of 21 May 1935 was just an ordinary law?
SCHACHT: It was simply an ordinary law.
GEN. ALEXANDROV: And you also considered the functions imposed on you by this law as Plenipotentiary for War Economy ordinary functions?
SCHACHT: As very common regulations which are customary with every general staff.
THE PRESIDENT: The Court will adjourn now.
[A recess was taken.]
Afternoon Session
THE PRESIDENT: Yes, General Alexandrov.
GEN. 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.
Defendant Schacht, on 21 May 1935 the Reich Government made a decision with regard to the Reich Defense Council. The decision was as follows, citing Point 1:
“It is the will of the Führer 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 Führer 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 wars?
SCHACHT: No, Mr. Prosecutor, I definitely do not admit that.
GEN. ALEXANDROV: On the 4th of March 1935, in your speech at the Spring Fair in Leipzig, you said the following, citing Exhibit Number USA-627 (Document Number EC-415):
“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 economic 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 Führer, and I shall neither do nor say anything which he has not approved. Therefore, the guardian of economic reason is not I but the Führer.”
Do you confirm this speech you made at the Spring Fair in Leipzig?
SCHACHT: 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 as long as his policies agreed with mine; afterwards I was not, and left.
GEN. ALEXANDROV: I have no more questions, Your Honor.
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.
During the cross-examination, the New Plan was again dealt with without Dr. Schacht’s 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?
SCHACHT: 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 exports.
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 on 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 exports.
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 German 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 to state here briefly that Germany, against my advice, had within five years contracted as large a foreign debt as the United States had throughout the 40 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.
We now hit the bottom. 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 this 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 creditors.
To meet this development, I looked for a way out 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.
DR. DIX: 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.
SCHACHT: Absolutely nothing.
DR. DIX: In this connection, can you give an estimate as to what percentage of German economic production was armament production?
SCHACHT: 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, 1934-35, 1935-36, 1936-37 and so on, amounted respectively to 5,000 million Reichsmark, 7,000 million Reichsmark and 9,000 million Reichsmark; that is the estimate of experts. The production of the entire German economy during these years could be estimated approximately at 50-60,000 million 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 10 to 15 percent of the entire German economy during the years when I had anything to do with it.
DR. DIX: Then, in the course of the cross-examination, there came up the question of your willingness or unwillingness to give up the office of Plenipotentiary for War Economy, and in order to prove your statement that General Von Blomberg did not wish you to give up that office, you referred to a document which has been submitted by the Prosecution. I am referring to Document EC-244, and it is a letter from the Reichswehr Minister, Von Blomberg, to Hitler, of 22 February 1937. It has already been read, so there is no need to do so now. May I only point out that in the last paragraph Blomberg expressed the desire that the Führer would direct or get the Reichsbank president to remain in office, so that covers the statement made by Schacht. Furthermore, in the course of cross-examination by Mr. Justice Jackson, mention was made of your credibility concerning the statement on your colonial aspirations; and from the point of view of colonial policy without mastery of the sea—Germany had not the mastery of the sea—can Germany have any colonial problems? That was the question and answer; and in that connection I would like to ask you: Did Germany have colonies before 1914?
SCHACHT: Yes.
DR. DIX: Before 1914, or let us say between 1884 and 1914, that is, the time when Germany had colonial possessions, did Germany have mastery of the sea, especially as compared with Great Britain?
SCHACHT: No, in no way.
DR. DIX: That covers it. Then there is another problem from the point of view of the credibility of your statements: Mention has been made of the ethical conflicts concerning your oath to Hitler, as head of the State, as you say, and the intentions which you have revealed to overthrow Hitler, even to kill him. Do you not know of many cases in history where persons holding high office in a state attempted to overthrow the head of the state to whom they had sworn allegiance?
SCHACHT: I believe you find these examples in the history of all nations.
THE PRESIDENT: Dr. Dix, we are not concerned with past history, are we? You do not think the question of whether there are historical instances is a legitimate question to put to this witness?
DR. DIX: Then I will not pursue that point any further; it is argumentation and maybe I can use it later in my final pleadings.
Now, returning to the question of colonies, is it not correct that, apart from your personal colonial aspirations, Germany, the Reich Government, had prepared officially for the acquisition of her colonies and later their administration; and was not there a colonial policy department until 1942 or 1943 or thereabouts?
SCHACHT: Well, it is set out explicitly in the Party program that the colonial demands are part of the Party program. Of course, the Foreign Office also concerned itself with it and I believe also in the Party there was a colonial policy department.
DR. DIX: Under Ritter Von Epp?
SCHACHT: Yes, under Ritter Von Epp.
DR. DIX: Then concerning the question of the mefo bills, I only want to summarize: Did you mean to imply that the mefo bills were to serve as a brake on rearmament, because the signature of the Reich to these bills, that is of the Reich Government, was binding for their repayment?
SCHACHT: You see, I said very clearly that the limitation of the mefo bills to 5 years, and making them mature in 5 years, would automatically put a brake on armament.
DR. DIX: Furthermore, Mr. Justice Jackson dealt with the point that the name of Schacht, when he retained office as Minister without Portfolio, had a propaganda value in favor of the Nazi regime abroad and therefore served the aggressive intentions and their execution. In this connection and in order to shorten the presentation of my documents, may I read from my document book, Exhibit 37(a), Document Schacht-37(a); that is, the English text is on Page 157 and the German on Page 149. On Page 5 of that long affidavit Huelse states:
“The foreign press drew from the dismissal”—that is, the dismissal as Reichsbank President in 1939—“the correct conclusions and interpreted it as a warning signal. In this connection in repeated conversations, even at the end of 1938, and in agreement with Dr. Schacht, I spoke with representatives of foreign issuing banks, whom I had met at board meetings of the Bank for International Settlement, and I informed them that the resignation of Schacht and individual members of the Reichsbank Directorate meant that things in Germany were following a dangerous path.”
Furthermore, the Prosecutor for the Soviet Union has accused Dr. Schacht, because in the biography of Reuter it is stated expressly that Schacht assisted the regime during the stage of the struggle for power. At any rate, that is the substance. That is correct as a quotation from Reuter’s book, but there is something else. I believe we still have to submit Exhibit 35 (Document Schacht-35), Page 133 of the English text and 125 of the German, and there we find on the second page of that long affidavit the following sentences, which limit the authenticity of that biography and prove it to be a biased piece of writing. Reuter says in this affidavit, and I quote:
“I had a biography of Dr. Schacht published twice, first at the end of 1933 by the Publishing House R. Kittler in Berlin, and at the end of 1936 by the German Publishing Institute in Stuttgart. Besides its being a factual presentation of his life and his work, it also served the purpose of shielding him from his attackers. Therefore the principles of purely objective historical research are not applicable to this publication, because defensive views required by the situation at the time has to be taken into consideration.”
This must be known and read before one can estimate the evidential value of that biography.
And that concludes my questions.
THE PRESIDENT: The defendant can then retire.
DR. DIX: I now call the witness Vocke with Your Lordship’s permission.
[The witness Vocke took the stand.]
THE PRESIDENT: Will you state your full name?
WILHELM VOCKE (Witness): Wilhelm Vocke.
THE PRESIDENT: Will you repeat this oath after me: I swear by God—the Almighty and Omniscient—that I will speak the pure truth—and will withhold and add nothing.
[The witness repeated the oath in German.]
THE PRESIDENT: You may sit down.
DR. DIX: Herr Vocke, you were a member of the Directorate of the Reichsbank. When did you enter the Reichsbank Directorate, and when did you resign from it?
VOCKE: Reich President Ebert appointed me a member of the Reichsbank Directorate in 1919, and Hitler dismissed me from office on 1 February 1939. Therefore, I was for about 20 years a member of the Reichsbank Directorate, and for 10 of these years I was under Schacht.
DR. DIX: Excuse me, but I must ask you, were you a member of the Party?
VOCKE: No.
DR. DIX: Were you a member of the SA?
VOCKE: No.
DR. DIX: Were you a member of the SS?
VOCKE: No.
DR. DIX: Were you a sponsoring member of the SA or SS?
VOCKE: No.
DR. DIX: You had no connection with the Party?
VOCKE: No.
DR. DIX: When did you meet Schacht?
VOCKE: In 1915. I merely made his acquaintance then, but it was not until he became Reichsbank Kommissar and Reichsbank President, that I came to know him better.
DR. DIX: I come now to the period of the first Reichsbank presidency of Schacht, that is, the year 1923. At that time what was the attitude of the Reichsbank Directorate to the candidature of Schacht as Reichsbank President?
VOCKE: A disapproving attitude.
DR. DIX: And for what reason?
VOCKE: We wanted Helferich as candidate for the presidency of the Reichsbank, because Helferich, in close co-operation with the Reichsbank, had created the Rentenmark and stabilization of currency.
But as reason for our disapproval of Schacht, we mentioned an incident contained in Schacht’s dossier which referred to his activity under Herr Von Jung in 1915. According to this, Schacht, who had come from the Dresdner Bank, had rendered assistance to the Dresdner Bank which Von Jung did not consider quite correct, and that was the reason for Schacht’s dismissal at that time.
The Reich Government, however, did not heed the criticism which we made against Schacht, and as Minister Severing told me recently, he followed the proverb, “It is not the worst fruit which is eaten by worms,” and Schacht was appointed President.
DR. DIX: So that Schacht came to you as President, and he must have known that the Directorate did not want him, or at any rate wanted somebody else. Therefore, I assume the question is in order as to what the relations were among that group, that is, the Reichsbank Directorate and the new President.
VOCKE: Schacht took up his office in January 1924. He called us all to a meeting in which he spoke very frankly about the situation, and this was the substance of what he said: Well, you disapproved of me for President because I stole silver spoons; but now I am your President, and I hope that we will work together, and we will get to see eye to eye—that was the expression used by Schacht—however, if one or another of you feels that he cannot work with me, well, then he will have to take the consequences, and I will gladly assist him to find another position.
Our relations with Schacht soon became good and we worked together successfully. It was very good to work with Schacht. We quickly recognized that he was an unrivalled expert in his and our branch, and also in other respects his conduct was beyond reproach. He was clean in his dealings and there was no nepotism. Neither did he bring with him any men whom he wanted to push. Also he was a man who at all times tolerated controversy and differing opinions—he even welcomed them. He had no use for colleagues who were “yes men.”
THE PRESIDENT: There is neither any charge nor any issue about this.
DR. DIX: That is quite correct, Your Lordship, but I thought it would be helpful to touch upon these things. But we are now at the end, and will come to the Reichsbank presidency from 1933 on.
[Turning to the witness.] After his short period of retirement Schacht again became President of the Reichsbank in 1933. Did you have any conversations with him about his relations to Hitler and to the Party?
VOCKE: Yes.
DR. DIX: Would you like to describe to the Tribunal the kind of statements Schacht made to you?
VOCKE: First, I would like to mention two conversations which I remember almost word for word. During the period when Schacht was not in office, that is about three years, I hardly ever saw him, maybe three or four times at occasions at the Wilhelmstift. He never visited me, nor did I visit him, except once, when Schacht came into the bank—maybe he had some business there—and visited me in my office. We at once...
DR. DIX: When was that?
VOCKE: That must have been in 1932, a comparatively short time before the seizure of power. We immediately began to speak about political questions, about Hitler and Schacht’s relations to Hitler. I used that opportunity to warn Schacht seriously against Hitler and the Nazis. Schacht said to me: “Herr Vocke, one must give this man or these people a chance. If they do no good, they will disappear. They will be cleared out in the same way as their predecessors.”
I told Schacht: “Yes, but it may be that the harm done to the German people in the meantime will be so great that it can never be repaired.”
Schacht did not take that very seriously, and with some light remark, such as: You are an old pessimist, or something like that, he left.
The second conversation about which I want to report took place shortly after Schacht’s re-entry into the bank. It was probably in March 1933, or the beginning of April. Schacht at that time showed a kind of ostentatious enthusiasm, and I talked to him about his relation to the Party. I assumed that Schacht was a member of the Party. I told him that I had no intention of becoming a member of the Party, and Schacht said to me: “You do not have to. You are not supposed to. What do you think? I would not even dream of becoming a member of the Party. Can you imagine me bending under the Party yoke, accepting the Party discipline? And then, think of it, when I speak to Hitler I should click my heels and say, ‘Mein Führer,’ or when I write to him address him as ‘Mein Führer.’ That is quite out of the question for me. I am and remain a free man.”
That conversation took place and those words were spoken by Schacht at a time when he was at the apex of a rapprochement with Hitler, and many a time I have thought about it, whether it was true, and remained true, that Schacht was a free man.
As things turned out, after a few years Schacht was forced to realize to his sorrow that he had lost a great deal of his freedom, that he could not change the course of the armaments financing scheme, upon which he had embarked, when he wished to do so; that it had become a chain in the hands of Hitler and that it would take years of filing and tugging for it to break.
But, in spite of that, his words were true inasmuch as they reflected the inner attitude of Schacht towards Hitler. Schacht never was a blind follower. It was incompatible with his character, to sign himself away to somebody, to sell himself and follow with blind devotion.
If one should seek to characterize Schacht’s attitude to Hitler thus: My Führer, you command, I follow; and if the Führer ordered him to prepare an armament program: I will finance an armament program, and it is for the Führer to decide to what use it shall be put, whether for war or peace—that would be incompatible with Schacht’s attitude and character. He was not a man who thought along subaltern lines or who would throw away his liberty; in that Schacht differed fundamentally from a great many men in leading political and military positions in Germany.
Schacht’s attitude, as I came to know it from his character and from his statements, could be explained somewhat as follows: Schacht admired this man’s tremendous dynamic force directed towards national aims, and he took account of this man, hoping to use him as a tool for his own plans, for Schacht’s plans towards a peaceful political and economic reconstruction and strengthening of Germany. That is what Schacht thought and believed, and I take that from many statements made by Schacht...
DR. DIX: That, I think, 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 transpired in the course of conversations, or whether you noticed anything about Schacht’s activities and work which would justify such a reproach.
VOCKE: 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 million gold mark credit which was repaid in 1933. Luther, when the Reichsbank cover disintegrated in the crisis...
DR. DIX: May I interrupt for the information of the Tribunal: Luther was Schacht’s predecessor.
VOCKE: ...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 Basel. 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 10 or 12 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 honor is our last asset. The banks which have helped us shall not lose a single pfennig.
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 purpose 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 that Schacht would understand me, and he did understand me immediately. He agreed with me and repaid that credit without hesitation. It never entered his head for what other purpose one might use that enormous sum of gold, 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 million gold marks.
As to the second incident, I cannot give the exact date, but I believe it was in 1936. The Reichsbank received a letter from the Army Command 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 Army Command had decided to evacuate the frontier areas and to confine itself to a central zone which could be defended under all circumstances. I still remember from the map which was attached to the letter that the line of defense 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 the greatest 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: 1936, I understood him to say that. Perhaps it is better that he should give you the date.
VOCKE: 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 rather relevant. May the witness continue?
THE PRESIDENT: Yes.
VOCKE: The line of defense 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.
The Reichsbank was shocked to hear 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 racing ahead and more and more money was being put up, Schacht asked for the support of the German professors of economy 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, Huelse, Dreyse, 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 offer. The newspapers are lying in order to lull the German people to sleep. The Poles have been attacked. Henderson did not even receive the offer, 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 made by quacks. The money has been wasted without point or plan.”
To the retort: “But we have an air force which can make itself felt,” Schacht said: “The air force does not decide the outcome of a war, the ground forces do. We have no heavy guns, no tanks; in three weeks the German armies in Poland will break down, and then think of the coalition which still faces 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.
DR. DIX: 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?
VOCKE: No, never.
DR. DIX: What was Schacht’s basic attitude to the idea of a war; did he ever mention that to you?
VOCKE: 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 partly even 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, Romania, and Czechoslovakia.
DR. DIX: Schacht made these statements?
VOCKE: 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.
DR. DIX: 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?
VOCKE: 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...
DR. DIX: 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.
VOCKE: Yes. Schacht said a foreign policy without armament was impossible in the long run. 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 defenseless in the midst of armed nations. He was not thinking of definite attack from any side, but he said that in every country there was a militarist party which might come to power today or tomorrow, and a completely helpless Germany, surrounded by other nations, was unthinkable. It was even a danger to peace because it was an incentive to attack her one day. Finally, however, and principally Schacht saw in armaments the only means of revitalizing 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 revitalized. Only in that way, he hoped, could unemployment be tackled.
DR. DIX: Now, events led to the militarization of the Rhineland, the reintroduction 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?
VOCKE: Not in the sense of your question. Schacht did speak to me about the incidents when the Rhineland was reoccupied, that is to say, he explained to me how 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 how he was only prevented in this by Herr Von Neurath, who said to him: “I was against that step, but now that you have 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.
DR. DIX: What were Schacht’s principles and ideas in foreign policy and how did these line up with his attitude to Hitler’s foreign policy?
VOCKE: 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 1928-29 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 am 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, with regard to 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-Shek, 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.
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 disapproved of Ribbentrop being sent to London and actively opposed this plan.
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 the weakest partner.
With regard to Austria, I know only that Schacht thought highly 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’s, 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 England, France, et cetera, whereby these powers should purchase part of the Portuguese colony of Angola and transfer it to Germany, who would not 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.
DR. DIX: Well, we can leave out the individual examples. The late Field Marshal Von Blomberg made a statement to the effect that the Reichsbank received every year from the Reichswehr Ministry a written communication about the state of the armaments. Do you, who were a member of the Directorate, know anything about this communication?
VOCKE: No, I have never heard anything about it.
DR. DIX: From the whole of your experience in the Reichsbank and your experience with 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?
VOCKE: It may be, but I consider it highly improbable.
DR. DIX: Now, when did Schacht start to try to stop the financing of armaments and thereby check rearmament; and, if he did try, and if you can affirm it, what were his reasons?
VOCKE: Schacht made the first attempts to limit armaments, I believe, about 1936, when economy was running 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.
DR. DIX: And do you know from your own experience what these attempts were?
VOCKE: 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 Göring, 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, and 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.
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, perpetual credit, so to speak, 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 the dismissal of Schacht.
DR. DIX: Well, Herr Vocke, for an outsider the motive for stopping the financing of armaments might 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?
VOCKE: Yes. At any rate, in 1938 the feeling that this tremendous armaments program which had no limits would lead to war became stronger and stronger, especially after the Munich Agreement. In the meantime Schacht had realized, 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 program and warmongering by every possible means. These means, of course, were only financial, such as the sabotage, et cetera, as I have already described. The final resort was the memorandum by which Schacht forced his resignation.
DR. DIX: We will speak later about that. May I ask you another question? The Tribunal knows about the method of financing this credit, namely, by mefo bills, so you need not say anything about that. What I want to ask you is now, in your opinion as a lawyer, could the financing of armaments by these mefo bills be reconciled with banking law?
VOCKE: The mefo bills and the construction of that transaction had, of course, been legally examined beforehand; and the point of their legality had been raised with us, and the question as to whether these bills could be brought under banking law had been answered in the affirmative. The more serious question, however, was whether these bills fulfilled the normal requirements which an issuing bank should demand of its reserves. To that question, of course, the answer is definitely “no.”
If one asks, why did not the bank buy good commercial bills instead of mefo bills, the answer is that at that time there had been no good commercial bills on the market for years—that is, since the collapse due to the economic crisis. Already under Brüning schemes for assisting and restoring economy and credit had been drawn up, all of which followed similar lines, that is, they were sanctioned according to their nature as normal credits along the lines of a semipublic loan; for the Bank was faced with the alternative of standing by helplessly and seeing what would happen to the economy or of helping the Government as best it could to restore and support the economy. All issuing banks in other countries were faced with the same alternative and reacted in the same manner. Thus the armaments bills, which, economically speaking, were nothing more than the former unemployment bills, had to serve the same purpose. From the point of view of currency policy the Reichsbank’s reserves of old bills, which had been frozen by the depression, were again made good.
All the regulations under banking law, the traditional regulations concerning banking and bills policy, had only one aim, namely, to avoid losses.
DR. DIX: I believe, Herr Vocke, it will be sufficient for the Tribunal if you could confirm that in the end the legal experts of the Reichsbank pronounced the mefo bills to be legal. The reasons for this, if Your Lordship agrees, we can omit.
Now we come to the memorandum which you have already mentioned. I want you to describe to the Tribunal the reasons which caused the Reichsbank Directorate, with Schacht at the head, to submit that memorandum to Hitler, and what the tactical purposes were which the Directorate, and therefore Schacht, hoped to achieve by that memorandum.
VOCKE: If we had been able to speak frankly, of course, we would have said: You must stop armaments. But the Reichsbank itself could not do this. Instead, we had to limit ourselves to the question of our responsibility for the currency. Therefore, the Reichsbank memorandum dealt with the question of currency. It said: If the financing of armaments is continued, German currency will be ruined and there will be inflation in Germany.
The memorandum also spoke of limitless credits, of unrestrained expansion of credits, and unrestrained expenditure. By expenditure we meant armaments. That was quite clear.
THE PRESIDENT: We have all seen the memorandum, have we not?
DR. DIX: He is not speaking about the contents of the memorandum, but of the reasons, the tactical reasons.
[Turning to the witness.] You understand, Herr Vocke, the Tribunal knows the text of the memorandum, so please confine yourself to what I have asked you.
VOCKE: The memorandum had to deal with the question of currency, but at the same time, we made quite clear what we wanted: Limitation of foreign policy. That shows clearly what we wanted: Limitation of expenditure, limitation of foreign policy, of foreign policy aims. We pointed out that expenditure had reached a point beyond which we could not go, and that a stop must be put to it. In other words, the expenditure policy, that is the armaments program must be checked.
DR. DIX: Now tell us, did you anticipate the effect that that memorandum would have on Hitler? What did you expect, tactically?
VOCKE: Either the memorandum would result in a halt of this intolerable expenditure which had brought us to ruin—for at the end of 1938 there was no more money available, instead there was a cash deficit of nearly 1,000 million. That had to be faced, and the Minister of Finance was on our side. If this was not recognized, then the smash would come and we would have to be released. There was no other alternative. We took the unusual step of getting the whole Directorate to sign this document.
DR. DIX: That, in my experience, is quite unusual, because generally an official document of the Reichsbank is signed by the President or his deputy, is it not?
VOCKE: That is true. We wanted to stress that the entire Directorate unanimously approved this important document which was to put an end to armaments.
DR. DIX: That, Witness, is clear. Have you any reason for believing that Hitler recognized that fact?
VOCKE: Yes, Hitler said something to the effect that that would be “mutiny.” I think that is the word they use in the Army. I have never been a soldier, but I think that when a complaint is signed by several soldiers, it is looked upon as mutiny. Hitler had the same ideas.
DR. DIX: Yes, something like that does exist. But you were not present there. Who told you about that expression “mutiny”?
VOCKE: I cannot remember that any more. I believe it was Herr Berger of the Finance Ministry. But I cannot say exactly.
DR. DIX: So there was talk about this expression in ministerial circles?
VOCKE: Yes.
DR. DIX: Now, that memorandum also contained a compliment to Hitler, a reference to his success in foreign policy.
VOCKE: Yes, Schacht had adopted the habit of using flattery in his dealings with Hitler. The greater an opponent of the Hitler regime Schacht became, the more he made use of this flattery. Therefore, in that memorandum, at any rate at the beginning where he spoke of Hitler’s successes, he also used those tactics.
DR. DIX: And what was the consequence of that memorandum? Please tell us briefly.
VOCKE: The result was that first Schacht was dismissed, then Kreide and Huelse, then I, Erhard, and Lessing. The result, however, was that they knew abroad what things had come to in Germany. My colleague Huelse had made unequivocal statements in Basel, and said that if we should be dismissed, then our friends would know to what pass things had come.
DR. DIX: Did Herr Huelse tell you that?
VOCKE: Yes, Huelse told me that.
DR. DIX: Your Lordship, shall we make a short pause here? I have not much more, but I still have the documentary evidence.
THE PRESIDENT: How much longer do you think you will take before you finish?
DR. DIX: It is very short and then the documentary evidence is also very short. Shall I continue?
THE PRESIDENT: The Tribunal will adjourn.
[A recess was taken.]
DR. DIX: Now, Witness, you have described to the Tribunal how that dismissal of Schacht and yourself came about. Why did Schacht not take that step before? Did he talk to you about it?
VOCKE: No. Throughout the years 1936 and 1937 we could not make up our minds. At first there was still hope that Hitler would steer a reasonable course as a statesman. Finally, in 1938, we reached a crisis, particularly in connection with the Munich Agreement and then after the Munich Agreement. Then, indeed, there was real anxiety that things would lead to war, and we then saw that we had to force the decision.
However, one has to consider the following: As a bank we could not bring up political or military arguments or demands which were not within our competence. The danger of inflation, which we had stressed in that memorandum, did not show until 1938, when the note circulation during the last ten months had increased enormously—more than throughout the five preceding years.
DR. DIX: So that it was not until that year that, let us say, a pretext, a means, was found to take that leap?
VOCKE: Yes.
DR. DIX: Now I will end with a general question. The high intelligence of Dr. Schacht is not disputed—that he was disappointed in Hitler and deceived by him, he says himself. You yourself, with your knowledge of Schacht’s personality must probably have had your own ideas as to how this mistake on the part of Schacht could be explained, how he could have been so deceived. Therefore, if the Tribunal permits, I should be grateful if you could give us your personal impressions about it, but...
MR. JUSTICE JACKSON: Your Honor, may I make an objection? I do not understand how the operations of Dr. Schacht’s mind can be explained by someone else. I have had no objection to any facts which this witness has known. We have even let him detail here at great length private conversations. However, speculation on Schacht’s mental operations, it seems to me, is beyond the pale of probative evidence.
THE PRESIDENT: Dr. Dix, as I think I have said before, you cannot give by one witness the thoughts of another man; you can only give his acts and his statements.
DR. DIX: Yes, Your Lordship. When I put the question, I said “if the Tribunal permits.” I, too, was aware of the question of admissibility...
THE PRESIDENT: You have the answer now: The Tribunal does not allow it.
DR. DIX: Then we will leave that question. May I ask Your Lordship this? Of course, I can still put questions about the treatment of the Jews by Schacht. I personally think that this chapter has been dealt with so exhaustively that it is not necessary for this witness to give us more examples of the attitude of Schacht. I would only ask to be permitted to put the same question concerning the Freemasons, because nothing has been stated about that.
[Turning to the witness.] Do you know anything about the treatment of Freemasons or the attitude of Schacht to Freemasons?
VOCKE: Yes. The Party demanded that the Freemasons should be eliminated from the Civil Service. Schacht said: “I refuse to let anybody tell me what to do. Everybody knows that I myself am a Freemason; how can I take action against officials simply because they belong to the Order of Freemasons?” And as long as Schacht was in office he kept Freemasons in office and promoted them.
DR. DIX: Now, one last question. Do you know whether Schacht ever received any gifts or had any economic advantages during Hitler’s time beyond his regular income as an official?
VOCKE: No; that was quite out of the question for Schacht. Besides, he was never offered gifts. In all his dealings, as far as money was concerned, he was absolutely clean and incorruptible. I can give examples. For instance, when he left in 1930 he reduced his pension to less than half the pension of the vice president or of any board member. He said: “These people have devoted their whole life to the bank, whereas I have given only a few years incidental service.” I could give more examples of Schacht’s absolute correctness in that respect.
DR. DIX: I believe, if the Tribunal does not wish so, it will not be necessary to give further examples. That brings me to the end of my interrogation of this witness.
THE PRESIDENT: Does any other counsel for the defense wish to ask any questions?
DR. GUSTAV STEINBAUER (Counsel for Defendant Seyss-Inquart): Witness, do you remember the financial-political measures on the occasion of the annexation of Austria in March 1938; that is to say, in general terms?
At that time two laws were issued, both of 17 March 1938, one concerning the conversion of schillings into marks, and the other for the taking over of the Austrian National Bank by the Reichsbank.
Dr. Schacht, as a witness, stated yesterday that on 11 March he was asked what exchange rate he would consider correct in the event of an entry into Austria, and he answered that question by saying that according to the latest market rate two schillings for one Reichsmark would be correct.
After the Anschluss, my client, Dr. Seyss-Inquart, objected to the under-valuation of the schilling, and he succeeded in getting the schilling converted at 1.50 to the Reichsmark. Is that correct?
VOCKE: Before the entry into Austria I had not heard of any ratio being fixed by the Reichsbank Directorate. They were entrusted with that question only after the entry into Austria, and as experts and bankers they proposed a ratio which was in accordance with the conditions; and only a slight modification was made for the exchange. It was for the Government to make concessions, if it wanted to win over the Austrian population or make it favorably inclined.
DR. STEINBAUER: The second law deals with the Austrian National Bank. The witness Dr. Schacht has said today that the Austrian National Bank was not liquidated, but—as he expressed himself—amalgamated. I have looked up that law and it states expressly in Paragraph 2 that the Austrian National Bank was to be liquidated. That is Document Number 2313-PS. Now I ask you, Witness, do you know anything about it? Was the Austrian National Bank left in function as an issuing bank, or was it liquidated?
VOCKE: The right to issue notes in Austria, of course, went to the Reichsbank, which, as far as I know, took over the Austrian National Bank in Vienna and carried it on. I do not remember any details. My colleague Kesnick took care of that.
DR. STEINBAUER: But maybe you will remember if I quote from the official reports of the Austrian National Bank that the gold reserve of the Austrian National Bank in March 1933 amounted to 243 million schillings in gold and the foreign currency reserve to 174 million schillings, which means that roughly over 400 million schillings in gold were taken over by the Reichsbank from the Austrian National Bank.
VOCKE: I do not recall these facts any more; but if it was done, it was done by law, by the Government.
DR. STEINBAUER: Yes. I have that law of 17 March. I just wanted to correct a mistake which Herr Schacht must have made today unintentionally. The law he himself signed says “shall be liquidated.” I have no other questions.
DR. LATERNSER: Witness, you said earlier that the fundamental difference between Dr. Schacht and the high military leaders was that he remained a free man in his attitude to the regime. I want to ask you now, since that statement seems to imply an opinion of the high military leaders: Which of the high military leaders do you know personally?
VOCKE: Not a single one.
DR. LATERNSER: Then would you maintain that opinion?
VOCKE: In our circle of the Reichsbank Herr Keitel and other gentlemen were considered too servile and too acquiescent toward Hitler.
DR. LATERNSER: But since you had no personal acquaintance with these people do you think that you can express a somewhat critical opinion on them, as you have done?
VOCKE: Yes, I think so.
DR. LATERNSER: I have no further questions.
THE PRESIDENT: Do any of the other counsel wish to cross-examine?
MR. JUSTICE JACKSON: Witness, when you met Dr. Schacht first, as I understood it, it was on the occasion of an official visit which you paid to Von Lumm in Brussels?
VOCKE: Yes.
MR. JUSTICE JACKSON: During the first years of the first World War?
VOCKE: Yes.
MR. JUSTICE JACKSON: Schacht then held some position on Von Lumm’s staff?
VOCKE: Yes.
MR. JUSTICE JACKSON: What was his position, Schacht’s?
VOCKE: I cannot say that. He was just one of the staff. How I came to meet him was that on one occasion when I was sent to Brussels to discuss something with Von Lumm, the latter took the opportunity to introduce his collaborators and among them was Schacht. We were merely introduced.
MR. JUSTICE JACKSON: And what was Von Lumm’s position? What was he doing in Brussels?
VOCKE: He was Commissioner for Banking with the General Command.
MR. JUSTICE JACKSON: General Command of the German Army?
VOCKE: Commissioner for the Banks with the Occupation Army.
MR. JUSTICE JACKSON: Named by Germany.
VOCKE: Without doubt.
MR. JUSTICE JACKSON: Well, he was a German, not a Belgian?
VOCKE: Yes, he was a German.
MR. JUSTICE JACKSON: Now, some time after that Schacht was dismissed by Von Lumm, was he not?
VOCKE: Yes.
MR. JUSTICE JACKSON: And you had a discussion with Von Lumm about that and also you had one with Schacht about it, did you not? Tell me whether you had the visit...
VOCKE: I read the official reports in Berlin about the dismissal of Schacht. I was working in the Reich Office of the Interior. I only spoke about these things with Schacht when he became Reichsbank President and he spoke to me about it one day.
MR. JUSTICE JACKSON: Now, before Schacht went on the staff of Von Lumm, he was director of the Dresdner Bank.
VOCKE: Yes.
MR. JUSTICE JACKSON: And the dismissal was because Schacht had delivered to that bank a considerable amount of Belgian francs.
VOCKE: Yes. I do not know how large that amount was.
MR. JUSTICE JACKSON: But it was considerable.
VOCKE: Maybe.
MR. JUSTICE JACKSON: And that, Von Lumm thought, gave to the Dresdner Bank an advantage which was incompatible with Schacht’s duties as a public official?
VOCKE: That, at any rate, was Von Lumm’s view. He took a very serious view, which Schacht, not being a civil servant, could not quite appreciate.
MR. JUSTICE JACKSON: And Von Lumm called a meeting and reproached Schacht?
VOCKE: Yes.
MR. JUSTICE JACKSON: Schacht then gave an answer to Von Lumm which Von Lumm considered was not sincere, but was merely a lie?
VOCKE: Yes. That was Von Lumm’s point of view.
MR. JUSTICE JACKSON: Now, that is what Von Lumm told you about?
VOCKE: That was in the written report which I have read.
MR. JUSTICE JACKSON: Now, when you came to talk to Schacht about it and about his answer to Von Lumm, Schacht told you that it was perhaps not quite an open answer, but not a lie?
VOCKE: Yes.
MR. JUSTICE JACKSON: However, having heard both sides of it, you along with all of the other directors of the Reichsbank were opposed to Schacht’s appointment as President, as you have testified.
VOCKE: Yes.
MR. JUSTICE JACKSON: And you took the view, along with all the other directors, that the behavior of Dr. Schacht in the Belgian bank affair was not quite fair and not quite correct?
VOCKE: Yes.
MR. JUSTICE JACKSON: Now, when Dr. Schacht came back to the Reichsbank under the Nazi regime, as I understand it, there was a good deal of resentment and reserve against him on the part of the Reichsbank Directorate, because he “in our eyes then was a Nazi. He was in close touch with Hitler and kept some things secret from us, his colleagues.” That is correct, is it not?
VOCKE: I could not say that. It is true there was a feeling against Schacht. As I explained before, because we had assumed, and I had assumed—though we were wrong about it—that he was a Nazi. It is possible that Schacht did keep things secret from us, but at any rate I do not know whether he did, or what those things were.
MR. JUSTICE JACKSON: Now, did you not say in a statement that he was in close touch with Hitler and kept some things secret from “us, his colleagues”?
VOCKE: I do not know whether he kept things secret from us. It is possible, but I could not prove it.
MR. JUSTICE JACKSON: Is it not true that years later, when already some fatal moments were reached in the currency system, circulation, price and wages system, “rumors came to our ears through semiofficial channels that Dr. Schacht had given Hitler the promise to finance armaments”? Did you not say that?
VOCKE: That Schacht had given the promise to Hitler? Well, in certain circles there were rumors of that nature. Whether it is true I could not say.
MR. JUSTICE JACKSON: Now, you felt after the Munich Agreement and after Hitler’s speech at Saarbrücken that that destroyed all hopes of peace, did you not?
VOCKE: Yes.
MR. JUSTICE JACKSON: And from that date, together with Pilseck, you did all in your power to persuade Schacht that a decision had to be forced?
VOCKE: Yes.
MR. JUSTICE JACKSON: Dr. Schacht agreed with you, but hesitated to take the decisive step?
VOCKE: Yes. He said—Schacht was not against it in principle, but he wanted to decide himself when our memorandum should be submitted, and as this memorandum was to be signed by all of us, and each one of us wanted to make corrections, the handing in of this memorandum was delayed from October until 7 January.
MR. JUSTICE JACKSON: The agreement was prepared by you and Pilseck?
VOCKE: Yes.
MR. JUSTICE JACKSON: And you approached Dr. Schacht again and again on it?
VOCKE: Yes.
MR. JUSTICE JACKSON: And he kept the draft all this time and told you that he was in doubt about the best moment to bring it before Hitler?
VOCKE: Yes.
MR. JUSTICE JACKSON: And it was not until Hitler refused to see him at Berchtesgaden that he finally sent him the memorandum?
VOCKE: That I do not know. I have heard here for the first time that Hitler refused to receive Schacht at Berchtesgaden. It may be. I only heard that Schacht was at Berchtesgaden, and after his return, according to my recollection, he talked about his meeting with Hitler and that now the moment had come to send him the memorandum.
MR. JUSTICE JACKSON: Well, your memorandum is the only source of my information, and according to my translation it says: “Finally, in December 1938, he resolved to sign it after a last attempt to speak with Hitler in Berchtesgaden.”
VOCKE: Yes.
MR. JUSTICE JACKSON: At that time, there was something of a financial crisis.
VOCKE: Yes.
MR. JUSTICE JACKSON: Considerable difficulty, inflation was just around the corner, as you might say.
VOCKE: The Government was confronted with the 3,000 million mefo bills which were about to fall due and which had to be covered, and the Minister of Finance had a cash deficit of 1,000 million. The Minister of Finance came to see us and asked us to tide it over, because otherwise he could not pay the salaries on 1 January. We refused. We did not give him a single pfennig. We told him that the best thing that could happen would be that bankruptcy should become manifest in order to show how impossible it was to continue this system and this policy. He then received money from private banks.
MR. JUSTICE JACKSON: And you and Huelse, particularly Huelse, had long warned against this course of the Reichsbank, is that not true?
VOCKE: No, that is not true.
MR. JUSTICE JACKSON: Had not you and Huelse, long before this, warned that this mefo business would end up in trouble?
VOCKE: Of course, the Reichsbank had for years fought against the mefo bills, which were to mature in March 1938, and from then on the Reichsbank did not give any more armament credits.
MR. JUSTICE JACKSON: Now, after his dismissal from the Reichsbank, you very frequently discussed matters with Schacht and you found that he had turned very bitter against the Government. Is that not true?
VOCKE: I did not have frequent meetings with Schacht. We met every few months in the beginning and then, when Schacht went to Guehlen, our meetings stopped; I saw him there only once or twice. But it was not only after his dismissal that Schacht became a bitter enemy of Hitler, but he had been that during the whole of 1938.
MR. JUSTICE JACKSON: And you said, “I think in his heart he hoped he would be called after Hitler’s defeat to help build a new and better order of things in Germany”?
VOCKE: Certainly. Schacht spoke to me in Guehlen about the men who would have to come after Hitler had been finally overthrown, and in conversation we mentioned the ministers who then could save Germany from despair, and Schacht was certain that he also would be called in to assist.
MR. JUSTICE JACKSON: No further questions, Your Honor.
THE PRESIDENT: Do any of the other Prosecution Counsel want to cross-examine?
DR. DIX: Herr Vocke, in reply to the questions of Mr. Justice Jackson, you have explained the attitude and the statement of Herr Von Lumm about the incident in Brussels. You also told the Tribunal about the statement by Minister Severing, which he made about that incident not so long ago.
VOCKE: Yes.
DR. DIX: Did you not also speak to the President of the Supreme Court of the Reich, Simons, who was at that time in the Foreign Office and knew the case very well? Did you not speak to him about that case?
VOCKE: Yes, I spoke to him and Ministerial Director Lewald. At that time I was a young assistant judge.
DR. DIX: You will have to tell the Tribunal who Lewald was.
VOCKE: It is correct that I spoke to Simons, who later became President of the Supreme Court of the Reich, and to His Excellency Lewald, who later became Undersecretary of State in the Reich Office of the Interior, about these matters which came officially to my knowledge in my capacity as expert in the Reich Office of the Interior.
Both gentlemen smiled at the self-important attitude of Von Lumm who made mountains out of mole hills, and also at the misfortune of Herr Schacht. They smiled benevolently and saw the whole thing as a tremendous exaggeration.
DR. DIX: Thank you, that is enough. I have no further questions.
However, if the Tribunal will permit me, I should like to point out that Schacht mentioned here that on 2 January 1939 he spoke at great length to Hitler, in Berchtesgaden. I do not know whether I am confusing that with a statement made by a witness or with a statement made by him. I just wanted to point it out. If he were still sitting here as a witness, he could tell us about it.
Your Lordship, I bring that up because it was stated by Mr. Justice Jackson that Hitler did not receive Schacht in Berchtesgaden and that that was the cause of Schacht’s decision to forward that memorandum. I only mention, as this witness here cannot know it, that Schacht did speak to Hitler. If he did not say so this morning or yesterday, he will say it at any time.
I cannot remember now. Sometimes one confuses private information with what one has heard in the courtroom.
THE PRESIDENT: Put the microphone where the Defendant Schacht can speak from there and ask him the question.
[The microphone was placed before the defendant.]
DR. DIX: Dr. Schacht, you have witnessed the cross-examination. Would you like to tell the Tribunal what happened?
SCHACHT: When I spoke here I said that I had a long conversation on 2 January 1939 with Hitler at Berchtesgaden on the Obersalzberg, and that after that conversation, in which the suggestion was put to me to create an inflation, I considered that the time had come to take that step which the Reichsbank afterwards took, to dissociate itself from Hitler and his methods.
[The microphone was returned to the witness.]
THE PRESIDENT: There is one question I want to ask you, Witness. Did the Defendant Schacht ever tell you that he had been appointed Plenipotentiary General for War Economy?
VOCKE: Yes.
THE PRESIDENT: When?
VOCKE: Well, I believe he was appointed to that office in 1935. I believe that is the date. I could not say for certain.
THE PRESIDENT: I did not ask you when he was appointed. I asked you when he told you.
VOCKE: I cannot recall that because we had nothing to do with these things. I only know that either in 1935 or 1936—I believe it was 1935—he received such an appointment.
THE PRESIDENT: Yes. The question I asked you was: Did the Defendant Schacht ever tell you that he had been appointed?
VOCKE: Yes.
THE PRESIDENT: When did he tell you?
VOCKE: I think in 1935.
THE PRESIDENT: The witness can retire.
DR. DIX: May I put one last question to this witness?
Witness, did you have any idea of the importance of that office?
VOCKE: No. I never heard that Schacht had done anything in that function except that he had special letter headings for this. His activity in the Reichsbank continued in the same way as previously, without his selecting a staff for that office, and without—at least as far as my knowledge goes—his using the premises and facilities of the Reichsbank for this new office.
DR. DIX: Have you any knowledge as to whether he had a separate office or a separate staff for carrying on his activity as Plenipotentiary?
VOCKE: You mean commissioner general for armaments?
DR. DIX: Plenipotentiary for War Economy.
VOCKE: No, he had no separate office, and as I have said before, as far as I know he never had a staff.
THE PRESIDENT: The witness can retire.
[The witness left the stand.]
DR. DIX: May I begin with my documents? I can make the presentation of documents very brief and I am sure that I will conclude it before the end of the session, because I had an opportunity to submit a large portion of my documents during the interrogation of witnesses. May I make the general request that judicial notice be taken of everything I have not read and everything I do not propose to read. In this connection, I should like to point out that the entire contents of my document book have, with one exception, either been submitted or will be submitted now as exhibits. The exception, the document which has not been submitted, is Exhibit Number 32. That is the frequently mentioned article of the Basler Nachrichten of 14 January 1946, which, for the reasons mentioned yesterday, has not been and will not be submitted by me.
I come now to Volume I of my document book, to the exhibits which have not yet been submitted; that is, first Exhibit Number 5 (Document Schacht-5) Adolf Hitler’s Reichstag speech of 23 May 1933. That exhibit was read by Schacht in the course of his interrogation and is now being submitted.
I further submit Exhibit Number 23 (Document Schacht-23), the letter from Schacht to Hermann Göring, of 3 November 1942. Although that letter has been submitted by the Prosecution, we submit it again, and for the following reasons: In the copy which was submitted by the Prosecution, the date and the year were left out and, of course, as it has been translated literally, also in our copy. However, a confirmatory note by Professor Kraus based on the testimony given by Schacht has enabled us to make a note on it to the effect that it must be the letter of 3 November 1942, because it was that letter which caused the dismissal in January 1943. It is only submitted in order to make it easier for the Tribunal to ascertain the date. That was Exhibit Number 23.
Then I wish to submit Exhibit Number 27 (Document Schacht-27). I am not going to read it; I only ask that judicial notice be taken of it. That is the address given by Dr. Schacht at the celebration meeting of the Reich Economic Chamber in January 1937.
Then I submit Exhibit Number 29 (Document Schacht-29), excerpts from the book by Gisevius, which we want to put into evidence, and I ask you to take judicial notice. I will not read anything.
Exhibit Number 33 (Document Number Schacht-33) in my document book is a letter from a certain Morton, a former citizen of Frankfurt-on-Main, who emigrated to England, a man who was highly respected in Frankfurt. The letter is directed to the Treasury Solicitor in England and we have received it here from the Prosecution. I also ask that judicial notice be taken of its contents and want to read only one sentence on the last page. I quote:
“I last heard from Schacht indirectly. Lord Norman who was then Mr. Montague Norman, Governor of the Bank of England, told me confidentially in 1939 shortly before the outbreak of the war, that he had just come back from Basel where he had seen Schacht who sent me his greetings. Lord Norman also told me that Schacht, who had returned to Germany from Basel, was in great personal danger as he was very much in disgrace with the Nazis.”
That concludes Volume I of my document book and I pass on to Volume II, which begins with the affidavits. I must go through the individual affidavits, but I shall not read any.
The first is Exhibit Number 34 (Document Schacht-34), which has frequently been quoted, the affidavit of the banker and Swedish Consul General, Dr. Otto Schniewind, who is at present in Munich. It is a very instructive and very exhaustive affidavit and in order to save time—there are 18 pages which would take up a lot of time—I will confine myself to what I have read from this affidavit; I ask the Tribunal to take judicial notice of the remainder. It has already been submitted.
However, I still have to submit Exhibit Number 35 (Document Schacht-35), which has not yet been submitted. I beg your pardon, but it has been submitted before. It is the affidavit of Dr. Franz Reuter. I submitted it when I spoke here about the biased nature of this biography. I ask you to take judicial notice of the rest of this affidavit.
The next Exhibit Number 36 (Document Schacht-36) is an affidavit by Oberregierungsrat Dr. Von Scherpenberg, formerly Embassy Counsellor at the Embassy in London, afterwards departmental chief at the Foreign Office and now at the Ministry of Justice in Munich, the son-in-law of Dr. Schacht. I have read a passage and I ask that judicial notice be taken of the unread portion.
The next is Exhibit Number-37(a) (Document Schacht-37(a)). It has been submitted. Here also a passage on Page 154 of the German text has been read, about the warning signal given abroad when Schacht resigned as Reichsbank President. I ask that judicial notice be taken of the remainder.
The next affidavit is by the same gentleman, who was also a colleague of Dr. Schacht in the Reichsbank Directorate at the same time as the witness Vocke, whom we have just heard. I submit it. There is no need to read anything. I only ask you to take judicial notice of its contents.
The next affidavit, Exhibit Number-37(c) (Document Schacht-37(c)) is by the same gentleman and has already been submitted. I ask you to take judicial notice of its contents. There is no need to read anything.
The next is Exhibit Number 38 (Document Schacht-38), an affidavit by General Thomas. It has not been submitted yet, and I submit it now and ask to be permitted to read one passage, beginning on the first page; that is Page 172 of the English text and Page 164 of the German text:
“Question: Schacht claims to have influenced Blomberg to delay rearmament. Can you give any information on this matter? When was it?
“Answer: I was Chief of the Army Economic Staff, that is the Army Economic and Armament Office at the High Command of the Wehrmacht (OKW) from 1934 to the time of my dismissal in January 1943. In this capacity I had connection with the Reich Minister of Economics and Reich Bank President Hjalmar Schacht. Up till 1936 Schacht undoubtedly promoted rearmament by making available the necessary means. From 1936 on he used every opportunity to influence Blomberg to reduce the tempo and extent of rearmament. His reasons were as follows:
“1. Risk to the currency.
“2. Insufficient production of consumer goods.
“3. The danger to the foreign policy, which Schacht saw in excessive armament of Germany.
“Concerning the last point he frequently spoke to Blomberg and me and said that on no account must rearmament be allowed to lead to a new war. These were also the reasons which led him to hold out to Blomberg in 1936 and again in 1937 the threat that he would resign. On both of these occasions I was delegated by Blomberg to dissuade Schacht from carrying out his threat to resign. I was present during the conference between Blomberg and Schacht in 1937.”
I ask you to take judicial notice of the remainder of that affidavit by General Thomas.
The next Exhibit is Number 39 (Document Schacht-39); parts of it have been read, that is to say, the part Schacht played in the incident of the 20th of July together with General Lindemann; it is the affidavit by Colonel Gronau. I ask the Tribunal to take judicial notice of the remainder.
The same applies to the next Exhibit Number 40 (Document Schacht-40). That is a sworn statement, also by a colleague of Schacht in the Ministry of Economics, Kammerdirektor Asmus, now in retirement. I have also read parts of this already, namely, the passages concerning the happenings at the time of the dismissal as Minister of Economics; and I ask you to take judicial notice of the remainder.
Then we come to Exhibit Number 41 (Document Schacht-41), which is the affidavit by State Secretary Carl Christian Schmid, also in retirement. I have not yet read anything and I ask to be permitted to read two passages.
The first one is on Page 182 of the German text; Page 190 of the English text:
“When the Brüning Cabinet, which had been arranged by General Von Schleicher...”—That is not legible. I think that should be different, but it is not legible.—“When that was torpedoed by Schleicher himself, Schacht considered the early appointment of Hitler as head of the Government to be unavoidable. He pointed out that the great mass of the German people said ‘Yes’ to National Socialism, and that the Left as well as the Center had come to a state of complete passive resignation. The short life of the transition cabinets of Papen and Schleicher was clear to him from the very beginning.
“Schacht decisively advocated the co-operation in National Socialism of men experienced in their respective fields, without acceptance of its program as a whole, which he always referred to ironically, later frequently calling it ‘a really bestial ideology’ in conversation with me; but he held that the influencing of developments from important inner power positions was an absolute patriotic duty, and he strongly condemned emigration and the resort to easy armchair criticism.”
And then on Page 184 of the German text, 192 of the English text, two very short passages:
“I recall numerous talks with Dr. Schacht in which he stated that war was an economic impossibility and simply a crazy idea, as, for instance, when he was in Mülheim at the house of Dr. Fritz Thyssen, who was closely associated with Göring and Hitler before 1933 but was in strong opposition from 1934 on and also opposed any idea of war as madness.”
And, then, further down on the same page, only one sentence:
“When Schacht spoke to me he used to refer ironically to the Himmler-Rosenberg Lebensraum plans against Russia as an example of the mad presumption of extremist Party circles. Schacht’s special fad was an understanding with England,”
and so on; and I ask you to take judicial notice of the remainder of the document.
The same applies to the whole of Exhibit Number 42 (Document Schacht-42), an affidavit by the director of the Upper Silesian Coke Works, Berckemeyer.
I come now to Exhibit Number 43 (Document Schacht-43). That has already been submitted and read in part. It is the correspondence between the publisher of Ambassador Dodd’s Diary and Sir Nevile Henderson. I ask you to take judicial notice of the part not yet read, and whatever comes after Exhibit 43 has been submitted. I ask you to take judicial notice of its contents, and I forego the reading of it.
That brings me to the end of my presentation in the case of Schacht.
THE PRESIDENT: Now the Tribunal will continue the case against the Defendant Funk.
DR. FRITZ SAUTER (Counsel for Defendant Funk): Mr. President, with your permission I call first the Defendant Dr. Funk himself to the witness box.
[The Defendant Funk took the stand.]
THE PRESIDENT: Will you state your full name, please?
WALTER FUNK (Defendant): Walter Emanuel Funk.
THE PRESIDENT: Will you repeat this oath after me: I swear by God—the Almighty and Omniscient—that I will speak the pure truth—and will withhold and add nothing.
[The defendant repeated the oath in German.]
THE PRESIDENT: You may sit down.
DR. SAUTER: Mr. President, may I begin with one observation: The Defendant Funk has been a sick man for many years now, and before he came into the prison he had been in hospital for some time. He was supposed to undergo an operation, which, however, due to conditions at the time, could not be carried out. He still is under medical treatment. In consideration of that fact, and because the defendant is extremely anxious to conclude his own interrogation as soon as possible, I shall put only those questions to the defendant which are absolutely necessary to give you a clear picture about his person and his activities.
[Turning to the defendant.] Witness, when were you born?
FUNK: On 18 August 1890.
DR. SAUTER: So you are now 56?
FUNK: Yes.
DR. SAUTER: First, I want to put to you the most important particulars of your life, and to simplify matters you may answer only with “yes” or “no.”
You are 56 years old. You were born in East Prussia?
FUNK: Yes.
DR. SAUTER: You come from a merchant’s family in Königsberg?
FUNK: Yes.
DR. SAUTER: Then you studied in Berlin at the university, law and political science, literature and music. You also come from a family which has produced a number of artists.
FUNK; Yes.
DR. SAUTER: During the World War you were first in the Infantry, and in 1916, because of a bladder ailment, you became unfit for service?
FUNK: Yes.
DR. SAUTER: Then you became an editor with several large newspapers, and you told me that for a long time you could not make up your mind whether to become a musician or a journalist. Then you decided for the latter, and in 1922, I believe, you became editor in chief of the Berliner Börsenzeitung. Is all that correct?
FUNK: Yes.
DR. SAUTER: Now perhaps you will tell us what were the political tendencies of that paper on which you worked for about ten years as editor in chief?
FUNK: The tendency of the paper was somewhere between the Center and the Right. The newspaper was not tied to any party. It was owned by an old Berlin family of publishers.
DR. SAUTER: What was the attitude of that paper to the Jewish question before you took on the editorship and during the time when you were editor in chief?
FUNK: Absolutely neutral. It did not deal in any way with the Jewish question.
DR. SAUTER: From an affidavit by Dr. Schacht, I have seen that at that time—that is to say, during the twenties—you moved in circles which were also frequented by Jews, and where economic and political matters, such as gold currency, et cetera, were often discussed. Is that correct?
FUNK: I do not know anything about that.
DR. SAUTER: Dr. Schacht has asserted that in an affidavit of 7 July 1945 (Document Number 3936-PS).
FUNK: I had a lot to do with Jews. That was in the nature of my profession. Every day at the stock exchange I was together with 4,000 Jews.
DR. SAUTER: Then in 1931 you resigned your post as editor in chief?
FUNK: Yes.
DR. SAUTER: What were the reasons for that?
FUNK: I was convinced that the National Socialist Party would come to power in the Government, and I felt called upon to make my own political and economic opinions heard in the Party.
DR. SAUTER: Would you like to explain a little more in detail what kind of opinions you had, Dr. Funk, especially concerning the clashes between parties, between classes at that time?
FUNK: The German nation at that time was in sore distress, spiritually as well as materially. The people were torn by Party and class struggle. The Government, or rather the governments, had no authority. The parliamentary system was played out, and I myself, for 10 or 12 years before that, had protested and fought publicly against the burden of the Versailles reparations, because I was convinced that those reparations were the chief cause of the economic bankruptcy of Germany. I, myself, have fought all my life for private enterprise, because I was convinced that the idea of private enterprise is indissolubly bound up with the idea of the efficiency and worth of individual human beings. I have fought for the free initiative of the entrepreneur, free competition, and, at that time in particular, for putting an end to the mad class struggle, and for the establishment of a social community on the basis of the industrial community.
All those were ideas to which I found a ready response in my conversations, particularly, with Gregor Strasser.
DR. SAUTER: Who was Gregor Strasser, would you tell the Tribunal briefly?
FUNK: Gregor Strasser at that time was leader of the Reich Organization Office of the National Socialist Party and was generally considered to be the second man after Adolf Hitler. I have...
THE PRESIDENT: This is the time to break off.
[The Tribunal adjourned until 4 May 1946 at 1000 hours.]
ONE HUNDRED AND TWENTY-FIRST DAY Saturday, 4 May 1946
Morning Session
[The defendant resumed the stand.]
DR. SAUTER: Mr. President, may I continue the examination of the Defendant Funk?
Dr. Funk, yesterday you gave us a brief account of your life, told us that you are 56 years of age, that you have been married for 25 years, that you were editor of the Berliner Börsenzeitung for 10 years; and in conclusion you told us yesterday what your convictions were regarding the future development of Germany.
Perhaps you can again tell us something of your viewpoint, since you were interrupted by the recess yesterday and since your health was in such a poor state yesterday evening that you could scarcely remember what you had told the Court. Well, what were your views on Germany’s economic prospects at the time when you entered the Party? Perhaps you can go over it briefly again.
FUNK: At that time Germany was in the midst of a very difficult economic crisis. This crisis was caused chiefly by the reparations, the way in which these reparations had to be paid, and by the inability of the governments then in office to master the economic problems. The most disastrous feature of the reparations policy was that German mark credits in immense sums were transferred to foreign countries without receiving any equivalent in return. As a result there was a tremendous surplus and over-pressure of Reichsmark abroad. It led to inflation in Germany and the countries with stable currencies bought Germany out. German industry incurred heavy debts and consequently came temporarily under foreign control; German agriculture became indebted. The middle classes, who were the chief representatives of German culture, were impoverished. Every third German family was unemployed, and the Government itself had neither the power nor the courage to master these economic problems. And these problems could not be solved by means of economic measures alone. The first essential was the presence of a government possessing full authority and responsibility; and then the development of a unified political will among the people.
The National Socialists at that time captured 40 percent of the seats in the Reichstag; the people streamed to this Party in ever-increasing millions, especially the young people who were animated by idealism. The fascinating personality of the Führer acted as a giant magnet. The economic program of the Party itself was vague; and in my opinion it was drawn up mainly with an eye for propaganda purposes. There were lively arguments about it in Party circles with which I came in contact in 1931.
At that time, therefore, I decided to give up my position as editor of a paper with a large circulation among the middle classes and to start on my own by editing an economic and political news service which went to the most diverse sections of economy, to leading Party circles as well as to economically interested parties siding with the German National Party, the People’s Party, and even the Democrats.
DR. SAUTER: Dr. Funk, you said before, approximately, that according to the opinion you expressed in 1931, only a government with full authority and full responsibility, that is, only a strong state and a unified political will, could lead Germany out of the crisis of that time, which was, of course, merely a part of the world crisis. Did you at that time ever reflect as to whether the Leadership Principle which was later developed to an increasing extent—whether this Leadership Principle could be made to harmonize with your ideas of economic policy? Or, putting it negatively, did you at that time anticipate great wrongs as a result of this Leadership Principle?
What can you say on this point?
FUNK: As to a principle of government, well, that is, a Leadership Principle, one can never say a priori whether it is good or bad. It depends on existing circumstances and, above all, on those who do the governing. The democratic-parliamentary principle had not been successful in Germany. Germany had no parliamentary and democratic tradition, such as other countries had. Conditions, finally, were such that when the government made decisions, the few votes of the economic party were decisive; and these were mostly bought. Therefore, another principle had to be made the dominant one; and in an authoritarian government, if those who bear the authority and the responsibility are good, then the government also is good. The Leadership Principle meant, in my opinion, that the best men and the best man should rule and that authority would then be exercised from above downwards and responsibility from below upwards. And in conversations with Hitler and other leading personalities of the Party in 1931 and, as I said, from the faith and enthusiasm which the German people brought to this political movement, I formed the opinion that this Party would have to come into power and that through it alone salvation could come. I, myself, wanted to put my own economic ideas into practice in this Party.
DR. SAUTER: Dr. Funk, you have just been speaking of the personality of Hitler. Through whom did you meet Hitler?—that is, who were persons in the Party by whom you were first won over to the Party?
FUNK: Chiefly, Gregor Strasser, as I said yesterday, who arranged my first meeting with Hitler. Not until much later, in Berlin, did I meet Hermann Göring. Apart from them I had very few acquaintances in the Party at that time and played no role in it myself.
DR. SAUTER: When you met Hitler what impression did he make on you at that time? I should like to say beforehand, you were at that time—1931, I think—a mature man of over forty. What impression did you have at that time of Hitler’s personality and aims, et cetera?
FUNK: My first conversation with Adolf Hitler was very reserved. That was not surprising as I came from a world which was entirely strange to him. I immediately received the impression of an exceptional personality. He grasped all problems with lightning speed and knew how to present them very impressively, with great fluency and highly expressive gestures. He had the habit of then becoming absorbed in the problems, in long monologues, so to speak, in this way lifting the problems to a higher sphere. At that time I explained to him my economic ideas and told him especially that I upheld the idea of private property, which for me was the fundamental tenet of my economic policy and which was inseparable from the concept of the varying potentialities of human beings. He, himself, heartily concurred with me and said that his theory of economics was also based on selectivity, that is, the principle of individual productivity and the creative personality; and he was very glad that I wanted to work on those lines in the Party and to arrange contacts and support for him in the economic field—which I actually did. In the meantime, however, my relations with the Führer became no closer then, because he said to me himself, “I cannot, at present, commit myself to an economic policy; and the views expressed by my economic theorists, such as Herr Gottfried Feder, are not necessarily my own.”
The economic policy section which existed at that time was directed by a Dr. Wagner.
DR. SAUTER: The economic policy section of what? Of the Reich Party Directorate?
FUNK: The economic policy section of the Reich Party Directorate was directed by a certain Dr. Wagner. I was not invited to political talks. A close connection with the Führer—or a closer connection with the Führer—I really had only in the year 1933 and the first half of 1934, when, as press chief of the Reich Government, I reported to him regularly. At that time it once even happened that he suddenly interrupted the press conference, went into the music room with me, and made me play the piano for him.
Then our relations became a little cooler again, and when I became Minister of Economics the Führer kept me more and more at a distance—whether he had special reasons for this, as Lammers testified here, I do not know. During my office as Minister, I was called in by the Führer for consultations perhaps four times—five at the most. But he really did not need me because his economic directives were given to the Reich Marshal, the responsible head of economic affairs, and later, from 1942 on, to Speer, since armament dominated the entire economy; and, as I said, I had close connections with him only in 1933 and in the first half of 1934 until the death of Reich President Von Hindenburg.
DR. SAUTER: Dr. Funk, you have got a long way ahead. We would like to return now to 1931 or 1932, to the time when you entered the Party. When was that?
FUNK: In the summer of 1931.
DR. SAUTER: The summer of 1931. You have already told the Court that you did not object to the Leadership Principle for the reasons you have stated.
FUNK: No, on the contrary, the Leadership Principle was absolutely necessary.
DR. SAUTER: On the contrary, you considered the Leadership Principle necessary for the period of emergency that then obtained. Now, I would be interested in knowing: There were other points of view, of course, also represented in the Party program which worked out unfavorably later on and have, in the course of this Trial, been used extensively against the defendants. I point out one example, for instance, the slogan of “Lebensraum”; you have heard it again and again during this Trial. The Defendant Dr. Schacht dealt with this problem also. Perhaps you can give us briefly your own position on this problem and on this question?
FUNK: The problem of living (Lebensproblem) is no slogan; and the problem of living was really a problem for the German people at that time. By “Lebensproblem”...
DR. SAUTER: You mean “Lebensraum”?
FUNK: ...or “Lebensraum”—I did not mean the conquest of foreign countries at that time; the thought of war was just as strange to me as it was probably to most other Germans. By “Lebensraum” I meant the opening up of the world for the vital interests of Germany, that is, the participation of the German people in the profitable utilization of the world’s goods of which there was a superabundance.
Whether that was to be done by colonies, or concessions, or international trade agreements, I did not trouble to find out at that time.
The expansion of Germany in the world economy before the first World War was the decisive factor which determined me to become an economic journalist. The participation of Germany in the Rumanian petroleum industry, the concession of the Bagdad Railway, the growing German influence in South America, in China, generally in the Far East—all this inspired me very much. At that time already I became acquainted with such men as Franz Günther of the Discount Bank, Arthur Von Gwinner of the Deutsche Bank, Karl Helferich, the big Hamburg importer, Witthöft, and many other German economic pioneers, and started on my profession with all the enthusiasm of the young journalist.
“Lebensraum” was thus for me at that time the fulfilling of these economic claims, that is, Germany’s participation in the world’s goods and the abolition of the restraints which hemmed us in on all sides. It was sheer nonsense that Germany on her part should have to pay reparations and debts while the creditor nations on their part refused to accept payment in the only form possible, that is, payment in goods and products.
That period marked the beginning of a great wave of protective tariffs in the world. I recall the American economic policy at that time; I recall the Ottawa agreements, and this mistaken economic policy led to a world economic crisis in 1929 and 1930 by which Germany also was badly hit.
DR. SAUTER: Dr. Funk, have you finished? [The defendant nodded assent.]
Dr. Funk, the Prosecution in their trial brief have contended that you participated in the formulation of the Nazi program. What can you tell us about that?
FUNK: I do not know what the Prosecution understands by Nazi program.
DR. SAUTER: I think—the Party program.
FUNK: That is quite impossible. The Party program, as far as I know, was formulated in 1921. At that time I did not know anything about National Socialism or of Adolf Hitler.
DR. SAUTER: Witness, the Prosecution has further accused you of setting up the so-called reconstruction program, the economic reconstruction program of 1932, that is, a program for the rehabilitation of German economic life. Is it correct that you established this economic reconstruction program?
FUNK: In 1932 I compiled for a speech by Gregor Strasser some points for an economic program which Strasser himself marked as originating from me. He passed these on to the various Party offices as instructions and propaganda matter.
This economic reconstruction program, which in the words of the Prosecution was to become the economic bible for the Party organizers, is, I believe, in no way revolutionary or even sensational; and it could, I believe, be adopted and accepted by every democratic government. I believe it is pointed out in a book from which the Prosecution has taken various bits of information.
DR. SAUTER: Perhaps it is printed, Witness, in the book by Dr. Paul Oestreich which has been repeatedly quoted. This book contains your biography under the title, Walter Funk, A Life for Economy, and has been used by the Prosecution under Document 3505-PS, Exhibit USA-653.
Dr. Funk, I have the text of this program before me.
FUNK: Please read it.
DR. SAUTER: The whole program covers half a page only and in the main sets forth really nothing which might be considered as characteristic of National Socialist trends of thought?
FUNK: Well, at that time I was not yet a National Socialist or, at least, but quite a young member of the Party.
DR. SAUTER: This economic reconstruction program must be actually read in order to convince oneself how little it contains of the characteristic National Socialist demands. This is a program which Funk says might be accepted by almost any liberal or democratic or other bourgeois party. The program is called, “Direct creation of employment through new State and private investments.” That is the first demand. Then productive providing of credit by the Reichsbank but no inflation, rather the re-establishment of a sound currency and a sound financial and credit economy to promote production.
General lowering of rates of interests paying attention to individual conditions of the economy. Creation of a foreign trade office and a central foreign exchange office. Reorganization of economic relations with foreign countries, giving preference to the vital necessities of the domestic market but with special attention to the export trade absolutely necessary for Germany. Restoration of sound public finances, including public insurances. Abolishment of the untenable methods of balancing the budget. State protection for agriculture. Reorganization of the system of house and land ownership in accordance with the principles of productivity and national health. Expansion of the German raw material basis, the establishment of new national industries and trades, organization of manufactories on the basis of technical innovations. That is all, which is comprised in this so-called economic reconstruction program.
FUNK: This program was to be, as the Prosecution has said, the official Party dogma on economic matters. I would have been glad if the Party had professed these principles. In later years I had great difficulties with these various Party offices in connection with my basic attitude on economic policy. I was always considered, even in Party circles, as a liberal and an outsider...
DR. SAUTER: A liberal?
FUNK: Yes. I combated all tendencies towards collectivism; and, for this reason, I constantly came into conflict with the Labor Front. I was supported, especially in my views regarding private property, by Reich Marshal Hermann Göring. Even during the war, he had parts of the Hermann Göring Works denationalized at my suggestion. I was an opponent of a nationalized economy because a nationalized economy will always produce only average results. Nationalized economy means sterile economy. An economy which is without keen competition and individual rivalry will remain stagnant and will achieve but average results. The Führer had, formerly, always agreed enthusiastically with these principles of mine. And it was a great disappointment to me when finally, in the last years, the Führer turned so sharply against the bourgeois world for that meant practically that the whole of my life’s work had failed.
THE PRESIDENT: Dr. Sauter, the Tribunal thinks he might get on to something more important than his view on state economy and private enterprise.
DR. SAUTER: Yes, Mr. President.
[Turning to the defendant.] Dr. Funk, you know that it was precisely on account of the big problem of unemployment at the time that Hitler was able to grasp power. What plans did you have for the elimination of unemployment, since you knew that just that very promise...
THE PRESIDENT: Dr. Sauter, we have heard nearly all the defendants on the conditions which obtained in Germany at that time. And there is no charge against these defendants for German economy between the years 1933 and 1939.
DR. SAUTER: Mr. President, I wanted to ask the Defendant Dr. Funk just how he thought that unemployment could be abolished; for from the testimony of other defendants, I gathered that they planned to eliminate it by other means, such as rearmament, and so forth. As far as I know, this was not so in his case; and I think that in judging the Defendant Funk, the question of how he proposed to handle the elimination of unemployment, whether by rearmament or by some other means, is of some importance. I do not think it will take much time, Mr. President. The Defendant Funk, I am sure, will be very brief.
Perhaps he can...
THE PRESIDENT: He can answer that in a sentence, I should think.
DR. SAUTER: Herr Funk, be as brief as possible.
FUNK: If I am to answer this in one sentence, I can say only that at that time I envisioned the elimination of unemployment by a very precise plan, but at any rate without rearmament, without armament...
DR. SAUTER: But, instead?
FUNK: By methods which I would have to explain. But in any event, armament never came into question then...
DR. SAUTER: But—can you perhaps tell us in a few telling words?
FUNK: First of all, opportunities to work were offered everywhere so to speak. It was imperative to set up a large-scale road-building program in Germany; it was necessary to revitalize the engine industry, especially the automobile industry, which, of course, had to be appropriately protected. An extensive house building program was needed; hundreds of thousands of houses were required...
DR. SAUTER: In short...
FUNK: Agriculture lacked mechanization and motorization.
I should like to give here, however, only two figures, two ratios, which throw light on the whole situation. Up to the war two-thirds of Germany’s total production went to private consumption and only one-third for public needs. Up to that point, therefore, the armament industry did not play a decisive role.
DR. SAUTER: Dr. Funk, now we will turn to another chapter.
You will remember that the Prosecution contended in their trial brief that the evidence against you was largely circumstantial. I assume, therefore, that it was based upon your offices rather than your actions. For this reason I should be interested to know which Party offices you held during the period which followed.
FUNK: Only once, in the year 1932...
DR. SAUTER: That is to say in the Party—not government offices.
FUNK: I understand. Only in the year 1932, and then for only a few months, did I receive Party assignments, because Gregor Strasser wanted to set up for me an office of my own, for private economy. This office, however, was dissolved a few months later when he himself resigned from the Party and from his offices. Then in December 1932 I was instructed to take charge of a committee for economic policy.
DR. SAUTER: In December 1932?
FUNK: Yes. And in February 1933, that is, 2 months afterwards, I gave up this office again. Both assignments were unimportant and never really got going in the short time they lasted. All the gentlemen in the dock who were in leading positions in the Party at that time can confirm this. I never had any other Party office; so that after 1933 I received no further assignments from the Party and no Party office either.
DR. SAUTER: Then this so-called Office for Private Economy (Amt für Privatwirtschaft), if I understood you correctly, existed for just a few months in the year 1932 but did not actually function. And in December 1932 you were made head of the other office, the Committee for Economic Policy as it was called. Then a month later, in January 1933...
FUNK: February 1933.
DR. SAUTER: February 1933, shortly after the seizure of power, you gave up this so-called office. Is that correct?
FUNK: Yes.
DR. SAUTER: Now for your connection with the Party. Were you a member of any organization of the Party—SA, SS, or any other section of the Party?
FUNK: I never belonged to any organization of the Party, neither SA nor SS, nor any other organization; and as I have already said, I did not belong to the Leadership Corps.
DR. SAUTER: You did not belong to the Leadership Corps?
FUNK: No.
DR. SAUTER: You know, Dr. Funk, that the Party functionaries, that is, the Party veterans, and so forth, met annually in November at Munich. You have yourself seen a film showing this anniversary meeting.
Were you ever invited to these gatherings on 8 and 9 November?
FUNK: I do not know whether I received invitations; it is possible. But I have never been at such a gathering, for these meetings were specially intended for old Party members and the Party veterans, in commemoration of the March on the Feldherrnhalle. I never participated in these gatherings, as I was averse to attending large gatherings. During all this time I attended a Party rally only once, just visiting one or two functions. Mass gatherings always caused me physical pain.
DR. SAUTER: Witness, did you receive the Golden Party Badge, after you became Minister for Economics?
FUNK: No; I received that when I was still press chief of the Reich government.
DR. SAUTER: You did not get it as Minister?
FUNK: No.
DR. SAUTER: How long were you a National Socialist deputy of the Reichstag?
FUNK: For just a few months.
DR. SAUTER: From when to when?
FUNK: From July 1932 to February 1933. I did not get another seat, because the Chairman of the Party, the chairman of the parliamentary group, Dr. Frick, informed me that, by a directive of the Führer, only the old Party members would receive mandates; and I had received a state position in the meantime.
DR. SAUTER: Witness, in regard to the laws which are of particular importance in this Trial, such as the Enabling Act, which practically eliminated the Reichstag; the law forbidding political parties; or the law for the unity of Party and State—in respect to all these laws, which were in preparation for later developments, were you still a member of the Reichstag at that time or had you already ceased to be one?
FUNK: I was no longer a Reichstag deputy. But even so, I considered these laws necessary.
DR. SAUTER: That is another question. But you were no longer a Reichstag deputy?
FUNK: No; and I was not a member of the Cabinet, either.
DR. SAUTER: Dr. Funk, we have frequently seen and heard of an affidavit by the American Consul General, Messersmith, dated 28 August 1945, Document 1760-PS. He says in the passage which concerns you:
“He had been the editor of one of the leading financial journals in Berlin before the Nazis came in and had very little open Nazi sympathy when they did come in.”
He goes on to say:
“...later he became an ardent Nazi and one of their most effective instruments because of his undoubted capacities in various fields.”
That is what the American Consul General, Messersmith, says about you. I should like to remind you of another passage from the book by Dr. Oestreich, which I have already mentioned and which has the title Walter Funk, A Life for Economy. That is 3505-PS, which has already been used and submitted in these proceedings.
In this book the author says that the assignments given to you by the Party, even if they covered a period of a few months only, might be regarded as particularly important.
What can you tell us about these two quotations?
FUNK: I have already stated that I declared myself for the Party and took up my Party work with enthusiasm. I was never attached to the propaganda organization, as has been asserted by Mr. Messersmith. I cannot remember that I ever knew Mr. Messersmith at all; nor do I remember discussing Austria with him, which he also asserts.
DR. SAUTER: Nor the Anschluss of Austria to Germany?
FUNK: I cannot remember that, although of course I considered the union of Germany and Austria necessary; but I do not recall discussing it with Mr. Messersmith.
As far as Dr. Paul Oestreich’s book is concerned, I am sorry that the Prosecution has used this book as a source of information. Mistakes have arisen which could have been avoided and which I would not have to refute here now. Oestreich was a man who was quite outside the Party.
DR. SAUTER: What was he?
FUNK: He owned a German newspaper in Chile, and for some years he was political editor of the Berliner Börsenzeitung.
DR. SAUTER: Political editor?
FUNK: First of all, he naturally wanted to secure a market for his book; and for that reason he exaggerated the importance of my position in the Party. He may have thought that in this way he would do me a particular favor. In any case, as things have been described there, they are not correctly stated.
DR. SAUTER: Witness, in Document Number 3563-PS, submitted by the Prosecution, there is a statement to the effect that you, Dr. Funk, were described in several publications as Hitler’s adviser on economic policy; and in another passage you are said to be Hitler’s “Wirtschaftsbeauftragter” (Economic Plenipotentiary). Was this a Party office, or what precisely was meant by this term? What functions is it supposed to indicate?
FUNK: It was neither a Party office nor a Party title. The press frequently called me so on account of my activity on behalf of the Party in 1932, and it was obviously adopted by writers from the newspapers. But it was neither an office nor a title. It is really nonsense to consider my activities at that time so important; for if they had actually been of importance, I should certainly have retained these offices when the Party came to power.
The Reich Minister for Food and Agriculture was also a Reichsleiter; State Secretary Reinhardt, of the Finance Ministry, was the head of the Department for Financial Policy in the Reich Party Directorate (Reichsleitung), et cetera. But there never was a “Reichsleiter für die Wirtschaft.” When the Party came to power I left the Reichstag and all Party organizations.
DR. SAUTER: Dr. Funk, a Reich Economic Council of the Party—I repeat the term: Reich Economic Council of the Party—has been mentioned once or twice in the course of this Trial. What do you know about your part in this Party organization and about the duties and domain of this Party organization?
FUNK: I had to think for a long time before I could remember this group at all, especially as neither Hess, Rosenberg, nor Frank remembered anything of the kind. But I remember dimly that Gottfried Feder had a Circle of people whom he used to call in for consultation and to which he gave the rather pompous name of “Reich Economic Council of the Party.” After the seizure of power this group ceased to exist. I never attended any of its sessions, and I was very much surprised to learn from the Indictment that I was supposed to have been the deputy chairman of this group. This group was of no importance whatsoever.
DR. SAUTER: You mentioned Gottfried Feder.
FUNK: He was responsible for the economic program and tenets of the Party from its establishment until it came to power.
DR. SAUTER: So he was the economic theorist of the Party from its foundation until it came to power?
FUNK: Yes. Dr. Wagner and Keppler overshadowed him later on. Keppler was always given the title of Economic Adviser to the Führer in public.
DR. SAUTER: Dr. Funk, if I understood you correctly, the persons whom you mentioned just now are those whom you consider as the economic advisers of Hitler?
FUNK: No, that is wrong.
DR. SAUTER: Well?
FUNK: Hitler did not allow anyone to advise him, especially on economic matters. These were merely the men who dealt with problems of economic policy in the Party leadership, both before and after my time.
DR. SAUTER: Also from the publicity angle, like Gottfried Feder?
FUNK: He did a good deal of writing; he treated the problem of the lowering of the rate of interest, for example, in great detail.
DR. SAUTER: Dr. Funk, those were your real or supposed Party offices. Now I turn to your State offices. After the seizure of power—that is, at the end of January 1933—you became press chief under the Reich Government. In March 1933, when the Propaganda Ministry was created, that being a State Ministry, you became State Secretary in this Propaganda Ministry under Minister Goebbels. How did that come about?
FUNK: May I give a short summary of these matters?
DR. SAUTER: One moment...
FUNK: It would go much faster than asking each question separately.
DR. SAUTER: Then I would ask you to consider at the same time the question of why you entered the Propaganda Ministry and were made press chief of the Reich Government, although you were usually always occupied with economic questions.
FUNK: The Reich Marshal has already stated in his testimony; firstly, that he never knew that I had been active in the Party at all before 1933, and secondly, that, as he himself rightly believed, my appointment as press chief of the Reich Government came as a complete surprise. On 29 January 1933 the Führer told me that he had no one among the old Party members who was intimately acquainted with the press and that he, therefore, wanted to ask me to take over the position of press chief, especially as this appointment involved regular reports to the Reich President. The Reich President knew me and, as I may mention again later on, very much liked me. I was often a guest at his home and was on friendly terms with his family.
DR. SAUTER: That is, Hindenburg?
FUNK: Yes, Hindenburg.
These were the reasons which prompted Hitler to make me press chief of the Reich Government. The press chief of the Reich Government was also a ministerial director in the Reich Chancellery, and I did not like the idea of suddenly becoming a civil servant, for I never had any ambitions in that direction. But I accepted the appointment, influenced by the general enthusiasm of that period and in obedience to the Führer’s summons.
I gave regular press reports to him, in the presence of Lammers. These conferences went on for a year and a half only, until the death of the Reich President, after which they stopped. The Führer issued instructions to the press through the Reich press chief of the Party, Dr. Dietrich, who was later also made a State Secretary in the Propaganda Ministry.
When the Propaganda Ministry was founded the Führer asked me to organize this ministry, so that Goebbels would not have to deal with problems of administration, organization, and finance. Then the Press Department of the Reich Government, of which I had so far been in charge, was incorporated in the Propaganda Ministry and placed under the direct control of Goebbels. It also had its own special chief.
From that time on—that is, after only 6 weeks activity as press chief of the Reich Government—my activities regarding the information and instruction of the press were at an end. From then on this was done by Goebbels himself, who generally drew a sharp line between the political and administrative tasks of the Ministry. He brought with him his old collaborators from the propaganda leadership of the Party to look after propaganda.
My services were not required for political propaganda. Goebbels took care of it through the Party organ, of which I was not a member. I had, for instance, as Chairman of the Supervisory Council, to be responsible for the finances of the German Broadcasting Corporation—a matter of a hundred million—but I never broadcasted propaganda speeches. Nor did I speak at any of the big State or Party rallies. Naturally, I fully appreciated the importance of propaganda for state leadership and admired the truly gifted manner in which Goebbels conducted his propaganda; but I myself played no part in active propaganda.
DR. SAUTER: Then, if I understood you correctly, your functions in the Propaganda Ministry, which was, of course, a state ministry, were of a purely administrative and organizational nature; and you left the actual propaganda to the Minister, Dr. Goebbels, and the people he brought into the Ministry from the Party propaganda instrument. Is that correct?
FUNK: Yes. Goebbels naturally claimed the exclusive right to dispose of all propaganda material. I did not appear beside him in the field of propaganda at all; and other considerable restrictions were imposed on my position as State Secretary by the fact that many assignments, looked after in other ministries by the State Secretary, were in this case taken care of by Goebbels’ expert, Hahnke, who was later made State Secretary and Gauleiter.
DR. SAUTER: Hahnke?
FUNK: Yes. I do not believe that during the entire period of my activity in the Propaganda Ministry I signed even three times as Goebbels’ deputy. One of these signatures has been nailed down by the Prosecution. It is a signature appended to an order for the execution of a directive and fixing the date on which it is to come into force.
DR. SAUTER: What kind of directive was that?
FUNK: The decree for the application of the law of the Reich Chamber of Culture. The Reich Cabinet decreed legislation in connection with the Reich Chamber of Culture. I was not a member of the Reich Cabinet; but as State Secretary to the Propaganda Ministry I was, of course, formally responsible, and naturally I promoted propaganda, as did everyone else who occupied a leading position in the official or the intellectual life of Germany. The entire cultural life of the nation was permeated with this propaganda in a measure appropriate to the overwhelming, fundamental significance which was rightly attached to propaganda in the National Socialist State.
DR. SAUTER: Dr. Funk, the Prosecution has held you responsible for laws decreed during your term of office as press chief of the Reichsregierung. I refer, for instance, to the laws submitted under Documents Number 2962-PS and 2963-PS. These are the laws well known to you and which concern the abolition of civil rights in Germany and the abolition of the parliamentary form of government. I ask you to explain, what did you have to do with these laws? Did you as press chief under the Reich Government have any influence on the contents and promulgation of these laws?
FUNK: No. This question has already been answered in the negative by both the Reich Marshal and Dr. Lammers. All I had to do was to pass on the contents of these laws to the press, in accordance with instructions given to me by the Führer.
DR. SAUTER: So you were surely present at the sessions of the Reich Cabinet...
FUNK: Yes.
DR. SAUTER: And you took note of the deliberations and resolutions of the Reich Cabinet...
FUNK: Yes.
DR. SAUTER: That was the reason of your presence there; but your sole duty—and please tell me if I am correct—was to inform the press, after the cabinet sessions, of the decisions made? Is that correct?
FUNK: Yes, that is correct.
DR. SAUTER: So you had no influence on the drafting or on the contents of the laws, nor on the voting? Is that right?
FUNK: Yes, that is right. I had neither a seat nor a vote in the Cabinet.
DR. SAUTER: Were you responsible for the press policy of the Reich Government—and I stress: the Reich Government and not the Party?
FUNK: I have already said that I received my instructions for the press from the Führer; that went on for 6 weeks. Then Dr. Goebbels took charge of press policy.
DR. SAUTER: You have already said that the press reports to Reich President Von Hindenburg ended with his death in August 1934?
FUNK: Yes.
DR. SAUTER: And also, from the same date, your press reports to Hitler, who was then Reich Chancellor, is it not so?
FUNK: Yes, that is correct. Reich President Hindenburg had died in the meantime.
DR. SAUTER: And afterwards the Reich press chief, that is the Party official, Dr. Dietrich, tended more and more to occupy your place?
FUNK: Yes, Dr. Dietrich was one of the Führer’s closest collaborators; and through him the Führer gave his instructions to the press.
DR. SAUTER: Dr. Funk, the book by Dr. Oestreich, 3505-PS, Exhibit USA-653, which we have already dealt with, contains the following quotation on your press policy; and I quote:
“Many of the journalists who worked in Berlin and the provinces are grateful to Funk for the way in which he attended to their wishes and their complaints, especially during the transition period.
“Funk is responsible for the much-quoted saying that the press must not be a ‘barrel-organ,’ with which he protested against the uniformity”—to use a German word, the one-sided modeling and leveling—“of the press and demanded individuality for it. But he also protected the press from efforts made by various offices to ‘grind their own ax....’”
Is that correct?
FUNK: Yes; I probably did write that; and that was my opinion. So far as it lay within my power, I tried to protect the press from standardization and arbitrary treatment, especially at the hands of the government offices.
DR. SAUTER: You have already said, I believe, that you took no part in the political direction of the Propaganda Ministry—I stress, the political direction of the Propaganda Ministry—or in the actual work of propaganda. Is that correct?
FUNK: Yes, that is correct.
DR. SAUTER: Mr. President, I turn now to a new complex. Do you wish to have the recess now, Your Honor?
THE PRESIDENT: I think we will go straight on. We are going to adjourn at 12 o’clock.
DR. SAUTER: Witness, I come now to your attitude on the question of anti-Semitism. I do so because you are held more or less responsible, along with others, for the excesses committed against the Jews. Will you tell us on what principles your attitude was based?
FUNK: I was never anti-Semitic on the basis of racial principles. At first I thought that the anti-Semitic demands of the Party program were a matter of propaganda. At that time the Jews in many respects held a dominant position in widely different and important fields of German life; and I myself knew many very wise Jews who did not think that it was in the interest of the Jews that they should dominate cultural life, the legal profession, science, and commerce to the extent that they did at the time...
The people showed a tendency toward anti-Semitism at that time.
The Jews had a particularly strong influence on cultural life and their influence seemed to me particularly dangerous in this sphere because tendencies which I felt to be definitely un-German and inartistic appeared as a result of Jewish influence, especially in the domain of painting and music. The law concerning the Reich Chamber of Culture was created, radically excluding the Jews from German cultural life but with the possibility of making exceptions. I applied these exceptions whenever I was in a position to do so. The law, as I have stated, was decreed by the Reich Cabinet, which bears the responsibility for it. I was at that time not a member of the Cabinet. During the period of my activities in the Propaganda Ministry, I did what I could to help the Jews and other outsiders in cultural life.
Everyone who knows me from my activities during that period can and must testify to that.
DR. SAUTER: I have submitted two affidavits in my document book; Documents Number Funk-1 and 2. The first was made by the editor of the Frankfurter Zeitung, Albert Oeser; and the second by a lawyer, Dr. Roesen. I ask you to take judicial notice of both these documents. The first affidavit proves that the Defendant Funk took a great deal of trouble to protect the interests of the above-mentioned Albert Oeser, the editor of the Frankfurter Zeitung, and those of a number of the staff of this newspaper, although by doing so he was endangering his own position. In particular, he persisted in retaining members of the staff who were not of Aryan descent and who, therefore, in accordance with the intentions of the Party, should no longer have been employed.
FUNK: It was not in accordance with the intentions of the Party, but in accordance with the law passed for the Chamber of Culture that they were no longer to be employed.
DR. SAUTER: In accordance with the law passed for the Chamber of Culture, also.
Then Document Number 2 of the document book, an affidavit made by Dr. Roesen, who confirms that the Defendant Funk also intervened, for instance, on behalf of the family of the composer, Dr. Richard Strauss, and his non-Aryan grandchildren and by so doing incurred certain personal danger. These are just a few examples; but the defendant can probably tell you of other cases in which he looked after people’s interests.
THE PRESIDENT: What exhibit number are you offering those as?
DR. SAUTER: Numbers Funk-1 and 2 in the document book. I have submitted the originals.
THE PRESIDENT: 1 and 2?
DR. SAUTER: 1 and 2.
[Turning to the defendant.] Dr. Funk, I have just said that perhaps you could—quite briefly—give us some more examples of cases where you used your official position to protect intellectuals and artists, whose views had got them into difficulties.
FUNK: Richard Strauss is a special case. That most remarkable living composer found himself in great difficulties on account of a libretto written by the Jew, Stefan Zweig.
I succeeded in having Richard Strauss again received by the Führer, and the whole affair was dismissed.
Dr. Wilhelm Furtwängler found himself in similar difficulties because he wrote an article praising the composer Hindemith; and composers with Jewish wives, such as Lehar, Künnecke, and others who were always in difficulties because of their efforts to evade the ban placed on the performance of their works. I always succeeded in getting permission for these composers to have their works performed.
THE PRESIDENT: The defendant can say that he helped hundreds of Jews, but that does not really destroy the fact that he may have acted hostilely by signing decrees against the Jewish race—his helping a few Jewish friends. Anyhow, I do not think that it need be gone into any detail.
DR. SAUTER: We are of the opinion, Mr. President, that in order to judge the character and personality of the defendant, it may be important to know whether he signed decrees which were in any way anti-Semitic because as an official he considered himself bound by his oath to carry out the law of the land, or whether he signed them because he himself was an anti-Semite who wished to persecute Jewish citizens and to deprive them of their rights, and for this reason only...
THE PRESIDENT: Dr. Sauter, the Tribunal thinks that you have made the point quite clearly that he helped Jewish friends, but it isn’t a question which need be gone into in detail.
DR. SAUTER: I come now, in any case, Mr. President, to another point. I want to ask the defendant how his activities in the Propaganda Ministry developed in later years.
FUNK: In exactly the same direction that I have described here. By degrees I came to be in charge of a large cultural economic concern—film companies, broadcasting corporations, theaters. I was director and chairman of the supervisory board of the Philharmonic Orchestra and on the Council of German Economy, which dealt collectively with the economic activities in the entire economic field at home and abroad with the active participation of the economy itself. Those were the main parts of my work.
DR. SAUTER: Witness, the Prosecution has submitted under Document Number 3501-PS an affidavit by the former Reich chief of the press—I believe—Max Amann, in regard to your activities in the Propaganda Ministry. I want to refer to this now. In that affidavit, we find the statement that Dr. Funk—and I quote literally:
“...was to all intents and purposes Minister in the Propaganda Ministry...”—And it says further on—and I quote again—“Funk exercised complete control over all means of expression in Germany: press, theater, radio, and music.”
Now, I ask you to comment on that; but you can do so quite briefly because I have already submitted an affidavit by Max Amann to the contrary to which I will refer later.
FUNK: Amann knew the Ministry only from the outside; and, therefore, he had no exact knowledge of its internal affairs. My work was done in the manner I have described. It is completely absurd to assert that under a Minister such as Dr. Goebbels the Ministry could have been led by someone else who was not the Minister.
Dr. Goebbels assumed such exclusive and all-embracing functions in the field of propaganda that he dwarfed everyone else.
DR. SAUTER: Mr. President, I have submitted an affidavit by that same former Reichsleiter Amann, dealing with the same subject, in the appendix to the Funk Document Book, under Document Number Funk-14—that will be Exhibit Number 3—and I ask you to take judicial notice of this affidavit. I do not think I have to read it. I administered that affidavit in the presence of and with the co-operation of a member of the Prosecution. The essential part of this affidavit of 17 April 1946 is that Reichsleiter Max Amann also admits that Funk had nothing to do with propaganda as such. That is to say, he did no broadcasting and indulged in no propaganda speeches but was mainly concerned with the organization and administration of the Ministry. Now, Mr. President, I come to the defendant’s position as Reich Minister of Economics.
[Turning to the defendant.] Dr. Funk, you were State Secretary in the Propaganda Ministry until 1937. At the end of November 1937 you became Reich Minister of Economics, after your predecessor, Dr. Schacht, had left that post. Can you tell us with the necessary brevity—of course—how that change took place and why you were called to that post?
FUNK: That took me completely by surprise, too. During a performance at the opera, the Führer, who was present, took me aside in the vestibule during an interval and told me that the differences between Schacht and Göring could no longer be bridged and that he was therefore compelled to dismiss Schacht from his office as Minister of Economics and was asking me to take over the post of Minister of Economics, as he was very well acquainted with my knowledge and experience in the field of economics. He also asked me to contact Reich Marshal Göring who would explain everything else.
That was the only conversation which I had with the Führer on the subject.
DR. SAUTER: And then you spoke to Göring himself? Will you tell us about that?
FUNK: Then I went to the Reich Marshal who told me that he had really only intended to put a state secretary in charge of the Reich Ministry of Economics but that later he decided that the extensive machinery of the Four Year Plan should be merged with the machinery of the Ministry of Economics. However, the minister would have to work in accordance with his directives and in particular the plenipotentiaries for the individual decisive branches of economy would be maintained and would receive their directives directly from the Delegate for the Four Year Plan. In order to proceed with the necessary reorganization, the Reich Marshal himself took over the direction of the Reich Economic Ministry; and in February 1938 he transferred it to me.
DR. SAUTER: So Göring himself was to all intents and purposes the head of the Reich Ministry for Economics for a period of about 3 months.
FUNK: The reorganization was effected under his control. The control of economic policy was in his hands then as well as later.
The main control offices under the Four Year Plan were maintained; for instance, the Foreign Currency Control Office, which gave directives to the Reichsbank; there was the Food Control Office, which gave directives to the Food and Agriculture Ministry; the Allocation of Labor Control Office, which gave directives to the Labor Ministry; and also the plenipotentiaries for the separate branches of economics: coal, iron, chemicals, et cetera, which were under the direct control of the Delegate for the Four Year Plan. Some offices were also transferred in this way to the Ministry of Economics from the Four Year Plan, which continued to function quite independently. They included the Reich Office for Economic Development and Research, which was under the direction of Professor Strauch, and the Reich Office for Soil Research, directed by State Secretary Kempner, mentioned here in connection with Slovakia and Austria.
I tried to restore the independence of these offices. I am still in ignorance of what these offices did. In any case, they thought themselves responsible to the Four Year Plan rather than to the Minister of Economy.
DR. SAUTER: Dr. Funk, the essential point of what you have just said seems to me to be that you received the title of minister but that in reality you were not a minister, but might have had the position of a state secretary and that your so-called Ministry of Economics was completely subordinated to the directives of the Four Year Plan—your Codefendant Göring in other words—and was compelled to follow these directives.
Did I understand it correctly?
FUNK: The latter point is correct. The Reich Marshal has clearly expressed and confirmed that here. But the first statement is not correct because formally, at least, I held the position of minister, which involved a gigantic administrative domain to which the Reich Marshal, of course, could not pay attention. The very purpose of the reorganization was that the Reich Marshal reserved for himself the direction and control of economic policy in the most important and decisive matters and gave me corresponding directives, but the execution of these was naturally in the hands of the Ministry and its organizations. But it is true that the position of minister, in the usual meaning of the term, did not exist. There was, so to speak, a higher ministry. But that has happened to me all my life. I arrived at the threshold, so to speak; but I was never permitted to cross it.
DR. SAUTER: That is not the case as far as this Trial is concerned.
Dr. Funk, the Prosecution asserts that, although you were not really a minister with the usual responsibility and independence of a minister, you, as Dr. Funk, Reich Economic Minister, still exercised supervision over those parts of the German economy which were grouped under war and armaments industry, that is, in particular, raw materials and manufactured materials as well as mining, the iron industry, power stations, handicrafts, finance and credit, foreign trade and foreign currency. I refer you, Dr. Funk, to the statements on Page 22 of the German translation of the trial brief, which I discussed with you several days ago.
FUNK: That is formally correct. But I have already explained how matters really were. I had nothing to do with the armament industry. The armament industry was at first under the High Command of the Armed Forces, under the Chief of the Armament Office, General Thomas, who was a member of Schacht’s conspiracy, of which we have heard here. The Armament Minister Todt, who was appointed in 1940, at once took over from me the entire power economy; and later on I turned over all the civilian production to Armament Minister Speer.
DR. SAUTER: What do you mean by civilian production?
FUNK: Coal, chemicals, consumer, and other goods. The main production branches in that field already mentioned here were, as I said before, under the Delegate for the Four Year Plan. Thus it came about that the Ministry of Economics gradually became a new Ministry of Commerce, which dealt only with the distribution of consumer goods.
DR. SAUTER: Mr. President, perhaps we might let him go on for a few seconds longer; because I would then come in a second to the subject of the Reichsbank President.
THE PRESIDENT: Certainly.
DR. SAUTER: Will you please continue briefly? You stopped. I believe you wanted to say more about manpower, gold, and foreign currency—about the competent authorities there.
FUNK: The Foreign Currency Control Office under the Four Year Plan was the competent authority for that; and the Reichsbank had to act in accordance with its directives—in my time, at least.
DR. SAUTER: And the direction of foreign trade?
FUNK: That was in the hands of the Foreign Office. The Minister for Foreign Affairs obstinately laid claim to that.
DR. SAUTER: And what did the Ministry of Economics do?
FUNK: The Ministry of Economics and the Reichsbank attended to the technical execution in this sphere, that is, the technical execution of clearing agreements, balances, et cetera.
DR. SAUTER: Mr. President, I come now to a separate theme. I should like now to discuss his position as President of the Reichsbank. I believe it might be a good moment to adjourn.
THE PRESIDENT: The Court will adjourn.
[The Tribunal adjourned until 6 May 1946 at 1000 hours.]
ONE HUNDRED AND TWENTY-SECOND DAY Monday, 6 May 1946
Morning Session
[The Defendant Funk resumed the stand.]
DR. SAUTER: Mr. President, I will continue my questioning of the Defendant Dr. Funk. On Saturday we were discussing the appointment of Dr. Funk as Reich Minister of Economics and now I turn to his appointment as President of the Reichsbank.
Witness, I believe it was in January 1939 when you also became President of the Reichsbank as successor to Dr. Schacht. How did that appointment come about?
FUNK: I had just returned from a journey about the middle of January 1939. I was called to the Führer and found him in a state of great agitation. He told me that the Reich Minister of Finance had informed him that Schacht had refused the necessary financial credits and that consequently the Reich was in financial straits. The Führer told me, in great excitement, that Schacht was sabotaging his policies, that he would not tolerate the Reichsbank’s interference with his policies any longer and the gentlemen in the Reichsbank Directorate were utter fools if they believed that he would tolerate it. No government and no chief of state in the world could possibly make policy dependent on co-operation or non-co-operation of the issuing bank.
The Führer further declared that from now on he himself, on the suggestions and demands of the Reich Minister of Finance, would fix all credits to be given by the Reichsbank to the Reich. He had given Lammers instructions to formulate a decree, together with the Reich Minister of Finance, by which the status of the Reichsbank, as established by the provisions of the Treaty of Versailles, would be changed, and whereby the terms for the granting of credits to the Reich would be determined by himself alone in the future.
The Führer further said that he was asking me to take over the direction of the Reichsbank, whereupon I replied that I would be glad to comply with his wish, but that first of all I had to have confirmation from him that the conditions for stabilization of currency would be maintained.
The opinion, which was voiced here by a witness, that inflation would be brought about through a further grant of credits at that time is wrong and totally untenable. Although 12,000 millions of credit can have an inflationary effect, 20,000 millions of credit will not necessarily tend toward inflation if the state has the necessary authority to stabilize prices and wages and to carry out the regulation and administration of prices, and if the people maintain the proper discipline in this respect, and if, finally, the money which as a result of increased credits represents excess purchasing power is diverted through taxes or taken up through loans; then, as far as the currency is concerned, there is absolutely no danger.
It is a fact that the Reichsmark, up to the final collapse, was kept on a stable basis. As far as the essentials of life are concerned, the purchasing power of money in Germany was secure. Of course, its value was limited insofar as consumers’ goods were produced only on a very limited scale, for almost all production was turned over to armaments.
DR. SAUTER: Dr. Funk, have you concluded?
FUNK: Just one moment, please. I believe this is a very important question.
In other countries as well, large credits were issued during the war which did not in any way cause an inflation. The national debt in the United States as well as in England was relatively, and in part even absolutely, higher than that in Germany. And in these countries, too, a correct financial policy overthrew the old thesis that a war would, of necessity, bring about the destruction of the monetary value.
The German people, up to the very end, until the terrible collapse, maintained admirable discipline. Money as a function of the state will have its value and currency will function so long as the state has authority to maintain it on a stable basis, to keep the economy under control, and as long as the people themselves maintain the necessary discipline.
Thus I took over this office not with the knowledge that Germany was now entering an inflation period but, on the contrary, I knew well that through maintenance of a suitable governmental policy the currency could be protected, and it was protected. However, the basic difference between Schacht’s position and my position lay in the fact that during Schacht’s time the Reichsbank could determine the granting of credits to the Reich, whereas this authority was taken from me, and the responsibility for domestic finances, therefore, was turned over to the Minister of Finance or of course to the Führer himself.
DR. SAUTER: Dr. Funk, I have another question. Perhaps, despite your poor state of health today, you might be able to speak a little more loudly so that the stenographers might understand you more easily. Please try, and we will make this as brief as possible.
Witness, then in addition to these offices of yours which we have discussed up to now, you finally had a further office as successor of Dr. Schacht, namely, that of Plenipotentiary General for Economy. Can you give us some details of your view in this connection in order to clarify your situation, your activity, and your achievements?
FUNK: This of all the positions I had was the least impressive. As the Reich Marshal correctly stated, and as Dr. Lammers confirmed, it existed merely on paper. That, too, was an essential difference between the position which Schacht had and the one which I had.
Schacht had been appointed Plenipotentiary General for War Economy. I, on the other hand, was the Plenipotentiary General for Economy. According to the Reich Defense Law of 1938, the Plenipotentiary General for Economy was to co-ordinate the civil economics departments in preparing for a war. But, in the meantime, these economic departments had been subordinated to the Delegate for the Four Year Plan, and I, as Plenipotentiary General for Economy, was also subordinate to the Delegate for the Four Year Plan.
Consequently, there was confusion and overlapping in matters of competence and authority as they had been laid down formally. The result was a directive of the Führer just a few months after the beginning of the war which de jure and formally transferred the authority of the Plenipotentiary General for Economy, as far as the civil economic departments were concerned, to the Delegate for the Four Year Plan.
DR. SAUTER: When was that?
FUNK: That was in December of 1939. There remained only a formal authority to issue directives, that is, I could sign directives on behalf of the five civil economic departments, which, according to the Reich Defense Law, were subordinate to the Plenipotentiary. I retained authority over the Ministry of Economics and the Reichsbank, which I had in any case.
DR. SAUTER: But you were subordinate even in these functions to the Delegate for the Four Year Plan; is that correct?
FUNK: Yes, like all civil economic departments. Only with the Ministry of Economics itself did I have a closer connection.
DR. SAUTER: Witness, in August 1939, that is, immediately before the beginning of the Polish campaign, you in your capacity as Plenipotentiary General for Economy summoned the civil economic offices to a meeting for discussions, and Document 3324-PS refers to this meeting. It seems to me important that you define your attitude on this point also, and especially with reference to the fact that apparently your letter to Hitler, dated 25 August, was a result of this meeting. This matter is mentioned in your trial brief on Page 24. Will you comment on it?
FUNK: In Schacht’s time there existed an office for the Plenipotentiary General for Economy, and a working committee was set up which consisted of the representatives of the various economic departments, as well as of the Ministry of the Interior, the Plenipotentiary for Administration, the OKW, and above all, of the Four Year Plan.
When Schacht resigned, the direction of this committee and of the office of the Plenipotentiary for Economy was transferred to Dr. Posse, his former State Secretary, whereas under Schacht State Counsellor Wohlthat had headed the office and the committee. These people, of course, had constant consultations, in which they discussed measures necessary in the economic sphere for waging war. And this was the organization of the Plenipotentiary for Economy which I dealt with in my speech in Vienna which had been mentioned here. It existed alongside the Four Year Plan, and in the main was charged with a smooth conversion of the civilian economy into a war economy in the case of war, and with the preparation of a war economy administration.
When, in August of 1939, there was a threat of war with Poland, I called together the chiefs of the civil economic departments, as well as the representatives of the Four Year Plan, and, in joint consultation, we worked out measures necessary for converting the civilian economy into a war economy in the case of a war with as little disturbance as possible.
These were the proposals which I mentioned in my letter to the Führer dated 25 August 1939, at a time when the German and Polish Armies already faced each other in a state of complete mobilization.
It was, of course, my duty to do everything to prevent dislocations of the civilian economy in the case of a war, and it was my duty as President of the Reichsbank to augment gold and foreign exchange assets of the Reichsbank as much as possible.
This was necessary first of all because of the general political tension which existed at the time. It would also have been necessary if war had not broken out at all, but even if only economic sanctions had been imposed, as was to be expected from the general foreign political tension which existed at the time. And it was equally my duty, as Minister of Economics, to do everything to increase production.
But I did not concern myself with the financial demands of the Wehrmacht, and I had nothing to do with armament problems, since, as I have already said, the direction of peacetime as well as war economy had been turned over to the Delegate for the Four Year Plan.
The explanation for the fact that at that time I kept aloof from the work of that committee is the following:
I personally did not believe that there would be war, and everyone who discussed this subject with me at that time will confirm this. In the months before the beginning of the war I concentrated my entire activity on international negotiations for bringing about a better international economic order, and for improving commercial relations between Germany and her foreign partners.
At that time it was arranged that the British Ministers Hudson and Stanley were to visit me in Berlin. I myself was to go for negotiations to Paris where, in the year 1937, I had come to know some members of the Cabinet when I organized a great German cultural fête there.
The subject of short-term foreign debts had again to be discussed and settled—the so-called moratorium. I had worked out new proposals for this, which were hailed with enthusiasm, especially in England. In June of 1939, an international financial discussion took place in my offices in Berlin, and leading representatives of the banking world from the United States, from England, from Holland, France, Belgium, Switzerland, and Sweden, took part in it.
These discussions led to results which satisfied all parties. At the same time I carried out the exchange or transfer of Reichsbank assets in foreign countries. This exchange of gold shares also was considered very fair and satisfactory in foreign banking circles and the foreign press.
In June of that year I went to Holland to negotiate trade agreements. I also participated in the customary monthly discussions of the International Clearing Bank at Basel as late as the beginning of July 1939, and despite the strong political tension which existed at the time I was convinced that a war would be avoided and I voiced this conviction in all my discussions, at home and abroad. And this is why during those months I was barely interested in the discussions and consultations on the financing of the war and the shape of war economy.
I had, of course, given instructions to the Reichsbank to use its available economic assets abroad as far as possible to obtain gold and generally to increase our foreign assets. But in the few months of my activity in this sphere before the war, the success of this endeavor of mine was slight. Our gold assets and foreign assets, as they were turned over to me by Schacht, remained on the whole unchanged until the war.
In my questionnaire to the Reichsbank Vice President, Puhl, I requested enlightenment on these transactions, since the Directorate of the Reichsbank and its managing director who, at that time, was Puhl, are bound to have information on this matter. The answer to this questionnaire, I am sorry to say, has not as yet arrived.
DR. SAUTER: Witness, you gave these details obviously to show that despite the political tension at the time you did not even think seriously of war.
FUNK: Not until August 1939.
DR. SAUTER: Now, in the course of these proceedings, we have heard about a series of discussions which Hitler had with generals and other personalities, and which concerned military and political matters. All these were discussions which we must say today stood in closest connection with preparations for war.
At which of these discussions were you present, and what did you gather from them?
FUNK: I was never called into political and military discussions, and I did not participate in any of these discussions which were mentioned here in connection with the charge of planning an aggressive war, so far as discussions with the Führer are concerned. I was also not informed about the contents of these discussions. And as far as I can remember, I was hardly ever present at the discussions with the Reich Marshal, when they dealt with this topic.
I have been confronted here with a meeting which took place in October of 1938.
DR. SAUTER: 14 October 1938? I can tell you the document number. It is 1301-PS.
FUNK: Yes.
DR. SAUTER: Were you present at that meeting?
FUNK: No.
DR. SAUTER: That was the meeting...
FUNK: Yes, that was the meeting in which, according to the indictment against me, Göring pointed out that he had been instructed by the Führer to increase armament to an abnormal extent. The Luftwaffe was to be increased fivefold, as speedily as possible.
The Prosecutor, according to the official record (Volume V, Pages 163, 164), asserts that, in this discussion, Göring addressed me in the words of a man who was already at war. I was not even in Germany those days but in Bulgaria, and consequently I could not participate in this meeting.
DR. SAUTER: Mr. President, as proof of the fact that the Defendant Funk was not in Germany at the time of this discussion with Göring on 14 October 1938 I have submitted several documents in the Document Book Funk; they are extracts from the Völkischer Beobachter, Numbers 5, 6, 7, and 8 of the Funk Document Book. These documents are submitted chiefly because they show that in fact from 13 October 1938 until 15 October 1938 Funk was at Sofia in Bulgaria, and therefore could not have been present at the Göring meeting on 14 October 1938.
What Funk said in Bulgaria about economic relations I need not read in detail. But I would like to refer especially to his speech of 15 October 1938, Funk Document Book Number 7, in which the Defendant Funk, particularly in the first paragraph, declared publicly that the thought of an economic union between the German economy and the Southeastern European economy was in his mind, and in which Funk quite definitely rejected a one-sided dependence of the economy of the southeastern states on the economic system of Germany.
Therefore I beg the Tribunal to take judicial notice of these documents as evidence and in order to save time I will not go into them further.
Witness, under Document Number PS-3562 the Prosecution has submitted a document dealing with a conference on 1 June 1939. You yourself did not attend this meeting, but according to the list of those present several representatives of your Ministry were there, as well as the representative of the Reichsbank. At this meeting the probable financial needs of the Reich in case of a war, the productive capacity of the Germany economy, and that of the Protectorate in case of a war were discussed. There is a marginal note in this record which says that the record was to be submitted to you. Can you state very briefly whether this was actually done?
FUNK: No, it was not done. I have the document here. If this record had been submitted to me I would have affixed my initials “W. F.” to it. Besides, this document deals with the continuous discussions, which I have already mentioned, about the financing of the war, and the measures to be taken in the field of civilian economy in case of a war. The decisive measures for the financing were naturally prepared by the Reich Minister of Finance, and these measures were discussed at length in this conference at which the question of meeting the expenses through taxes was one of the chief topics. In any event, a variety of such discussions was carried on continuously at that time among the representatives of the various departments, and they took place in the office of the leading staff of the Plenipotentiary for Economy. By chance I have now found this name which earlier I could not remember: this was the institution—the committee—which was founded in the days of Schacht and was later continued.
DR. SAUTER: Dr. Funk, on 30 March 1939 you made a statement of your program in a speech before the Central Committee of the Reichsbank.
I have included these excerpts from the speech which have a bearing on this Trial in the Funk Document Book under Number 9. I am coming back to this speech because it was delivered before the Central Committee shortly after the defendant assumed his office as President of the Reichsbank, and represents his program as President of the Reichsbank in connection with various matters which have played a part here.
Dr. Funk, perhaps with just a few brief words you might give us the essential relevant points of your speech, insofar as the Prosecution is interested in them.
FUNK: I do not believe I need do that. I briefly mentioned a while ago that in these months I carried on international discussions about the necessity for a new order in international economic relations, and that I also pointed out Germany’s readiness to play a positive part. Therefore, I do not think I need read anything more from this speech; it is only meant to show that at that time I did not work on preparations for war but endeavored to bring about international economic understanding, and that these, my efforts were recognized publicly in foreign countries, especially in England.
DR. SAUTER: This intention to establish favorable and confident relations with foreign countries, that is, with their financial and economic circles, was, I am sure, a deciding factor in a later measure to which you already referred a little while ago, namely that compensation to foreign shareholders in the Reichsbank, who, I believe, existed chiefly in England, Holland, and Switzerland, was assessed and paid in a particularly loyal manner.
FUNK: Yes, I have stated that already.
DR. SAUTER: Dr. Funk, you mentioned earlier a letter which you wrote to Hitler. This letter would be interesting to me insofar as I would like to know just why you wrote it, and why in it you spoke of “your proposals,” even though in the main they were concerned with things which did not actually originate with you. Perhaps you will say a few words about this letter.
FUNK: The tone and contents of this letter can be explained from the general mood which existed everywhere in Germany at that time. Beyond that it is a purely personal letter to the Führer: In it I thanked him for his congratulations on my birthday. For this reason the letter is a little emphatic in its style. When I spoke of “my proposals,” this may be traced back to the fact that I had personally some time before explained to the Führer what measures would be necessary if a war broke out. And in the main, those were the measures which were adopted later as a result of conferences with the other economic offices, and to which I referred in this letter. Thus it was not quite correct for me to say “my proposals.” I should really have said, “The proposals worked out together with the other economic offices.”
DR. SAUTER: Dr. Funk, have you concluded?
FUNK: No. I would like to explain this whole letter with just a few words, since it is apparently one of the pillars of the Prosecution’s case against me.
As I have said, it was the time when the two mobilized armies faced each other. It was the time when the entire German people were in a state of great excitement because of the constant provocations and the ill-treatment of the German population in Poland. I personally did not believe that we would actually have war, for I was of the opinion that diplomatic negotiations could again be successful in preventing the threat of war and indeed in avoiding war itself. After the Führer’s almost miraculous successes in foreign policy, the heart of every true German had to beat faster in the expectation that in the East also Germany’s wishes would be fulfilled; that is, that my separated home province of East Prussia would be reunited with the Reich, that the old German city of Danzig would again belong to the Reich, and that the problem of the Corridor would be solved.
The overwhelming majority of the German people, including myself, did not believe that this question would end in war. We were rather convinced that England would be successful in exerting pressure on Poland so that Poland would acquiesce in the German demands on Danzig and the Corridor and would not bring on a war. The testimony of the witness Gisevius must have made clear to everyone in the world that England did nothing at that time to exert a soothing and conciliatory influence on Poland. For if the British Government knew that a conspiracy existed in Germany in which the Chief of the General Staff, the Chief of the OKW, the Chief of German Armament and other leading military personalities and generals were involved, and that an overthrow had been prepared for the event of war, then the British Government would have been foolish indeed if they had done anything to assuage and conciliate Poland. The British Government must have been convinced that if Hitler should go to war, a coup d’état, a revolution, an overthrow would take place, and that, in the first place, there would be no war and, secondly, that the hateful Hitler regime would be removed. Nobody could hope for more.
DR. SAUTER: Dr. Funk, we do not want to talk politics, but rather return to this letter of 25 August 1939. May I repeat the number, 699-PS. Let us at present deal only with this letter. If I understood you correctly, I can summarize your testimony as follows: This rather enthusiastic letter to Hitler was written because you were hopeful that Hitler would succeed in reuniting your home province of East Prussia with the Reich, and would now finally settle the Corridor problem without a war. Did I understand you correctly?
FUNK: Yes, but at the same time I feel I must state that I on my part did everything to ensure that in the event of war, peacetime economy would without disturbance be converted into a war economy. But this was the only time at which, as Plenipotentiary for Economy, I was active at all with regard to the other economic departments and the fact that I referred to my position in this letter may be explained quite naturally, because I was proud that I had for once done something in this official position—for every man likes to be successful.
DR. SAUTER: Dr. Funk, we are still concerned with the question of whether you knew of Hitler’s intent to bring about a war, especially to wage aggressive war and to make conquests through aggressive wars. I would like to put to you a few questions which, for the sake of simplicity, you can answer with “yes” or “no”; I would like to know only whether your knowledge and your presentiment agree with the statements made by a few witnesses and some codefendants.
For example, Reich Minister Lammers testified that you found it especially difficult to see Hitler at all, that an audience was granted you only once in a long while, and that even on one occasion I believe you waited for days with Lammers at headquarters for the promised audience, and that you had to leave again without having gained admittance. Is that correct?
FUNK: Yes, I am sorry to say.
DR. SAUTER: Now a further question: We have been confronted with several documents which say explicitly—I believe they are records of Lammers—that the Reich Minister of Economics, and at one time also the Reich Foreign Minister, had requested to be called in to these discussions, that Minister Lammers did his best to bring this about, but that Hitler did not allow it, that he expressly barred you and the Reich Foreign Minister from attending these discussions even though you pointed out that important matters of your department were being dealt with. Is that correct? Perhaps you can answer with just “yes” or “no.”
FUNK: The meeting which you mention is concerned with the deployment of labor. I myself had no direct connection with that, and the Foreign Minister probably did not have any marked interest in it either. So I assume that for these reasons the Führer did not need me, for as I said yesterday his directives for the conduct of economy were given, up to the year 1942, to the Reich Marshal as the man responsible for that field, and after 1942 the directives were given to Speer, because from that date on armaments dominated the entire economic life, and all economic decisions, by express order of the Führer, had to give way to armament needs.
DR. SAUTER: Dr. Lammers, in his testimony on 8 April, stated—I quote:
“The Führer objected many times, namely against Funk. There were various reasons for objecting to Funk. Hitler was skeptically inclined toward Funk and did not want him.”
Thus for the testimony of the witness Dr. Lammers. Can you explain why Hitler was disinclined toward you?
FUNK: No, only by the objective explanation that he did not need me.
DR. SAUTER: In other words, he considered any discussions with you superfluous.
FUNK: Yes.
DR. SAUTER: Witness, in connection with the topic of aggressive wars, I would be interested in the following: In the Indictment, on Page 30 of the German trial brief, it is set forth that you personally and through your official representatives, that is you personally as well as through the representatives who were appointed by you, participated in the preparation for the aggressive war against Russia, and as the sole proof for this Document Number 1039-PS, Exhibit USA-146, is submitted. From this document it appears that you, Defendant, at the end of April 1941, allegedly had a discussion with Rosenberg—who was responsible for the Eastern Territories—about the economic questions which would arise if the plans for attack in the East were to be carried through. I ask you, Dr. Funk, to note the date of this discussion: the end of April 1941, just a short time before the beginning of the war against Russia. In order to refresh your memory I want to point out that at that time, that is, before the war against Russia, Rosenberg had already been nominated as Hitler’s plenipotentiary for the uniform handling of problems in the Eastern Territories. I am asking you now to define your position and to say whether it can be derived from this discussion that you participated in an aggressive war against Russia or its planning and preparation, and if you did participate, how?
FUNK: I knew nothing about an aggressive war against Russia. I was very much surprised when I learned from Lammers that the Führer had made Rosenberg plenipotentiary for Eastern European problems. Lammers stated here that he had me advised of this nomination for personal reasons, because he knew that I was very much interested in economic relations with Russia. Indeed, our mutual efforts, Russia’s as well as Germany’s, had succeeded in considerably expanding our trade relations; for in earlier times, that is, before the first World War, German trade with Russia had been the decisive factor in the balance of German trade and had amounted to several thousand million gold marks.
The Russians—I must say this here—furnished us grain, manganese ore, and oil very promptly, while our deliveries of machines lagged behind for the natural reason that the machines had first to be produced since the Russian orders were mainly for specialized machines. To what extent army supplies were sent to Russia, I do not know, as I did not deal with these.
And so I was surprised by the appointment of Rosenberg. He called on me for a short discussion in which he told me that the task given to him by the Führer also included handling of economic problems. Thereupon I placed a ministerial director in my ministry, Dr. Schlotterer, at Rosenberg’s disposal to work on these problems. And when the Ministry for Eastern Affairs was founded, as far as I know, in July, Dr. Schlotterer, with some of his colleagues, took over the direction of the economic department in Rosenberg’s Ministry. And simultaneously, as far as I remember, Dr. Schlotterer became a member of Economic Operational Staff East. This was the institution of the Four Year Plan which has been mentioned repeatedly here during the proceedings and which dealt with all economic problems in the Occupied Eastern Territories.
Beyond that, I had nothing to do with these matters. Naturally I asked Lammers as well as Rosenberg just what this signified, and both of them told me that the Führer was of the opinion that a war with Russia would become unavoidable, that along the entire Eastern Front the Russians had concentrated large reinforcements, that the discussions with Molotov, in which I had no part at all, had been unsatisfactory, that the Russians were making demands regarding the Baltic, the Balkan regions, and the Dardanelles, which could not be accepted by Germany, by the Führer. At any rate, this affair was as complete a surprise to me as to the German people, and I am convinced that this war was a great shock to the German people.
THE PRESIDENT: The witness spoke of July. Did he mean July 1940?
DR. SAUTER: As far as I know, July 1941.
THE PRESIDENT: You mean July 1941? That was after the war with Russia had begun. The witness can answer for himself, I suppose, can he not?
[Turning to the defendant.] Did you mean July 1940?
FUNK: The discussion with Rosenberg was at the end of April or the beginning of May 1941, and the Rosenberg Ministry was founded in July 1941.
DR. SAUTER: I now turn to a different point raised by the Prosecution. You are accused of having, as Reich Minister of Economics, committed punishable acts in connection with the criminal plan to persecute the Jews and to eliminate them from economic life. These are the happenings of November 1938. Will you therefore now describe your activity in this respect.
FUNK: May I ask the Tribunal to give me time for a rather detailed account on this topic. Then the points which we will treat later can be dealt with much more briefly. This is the charge of the Prosecution which really affects me most gravely.
When I took over the Ministry of Economics in February 1938, I very soon received demands from the Party, and especially from Goebbels and Ley, to eliminate the Jews from economic life, since they could not be tolerated. I was told that people were still buying in Jewish stores, and that the Party could not permit its members to buy in such stores; the Party also took offense at the fact that some high state officials, and in particular their wives, were still shopping in such stores. The sectional chairmen of the Labor Front refused to work with Jewish managers. There were constant clashes, I was told, and there would be no peace if the measures which had already been introduced here and there were not extended gradually to eliminate the Jews completely from economic life.
The Law for the Organization of National Labor, which was decreed under my predecessors and which was also carried through by them in agreement with the German Labor Front, had assigned political and Party functions also to domestic economy. The plant manager was also responsible to the Party and above all to the State.
Some Jewish managers readily succumbed to the pressure and sold their businesses and enterprises to people and at prices of which we did not approve at all. I had made private agreements with individual Jewish leading men in banking, heavy industry, and the big stores, and had thus brought about their withdrawal from positions in economic life. There was no peace, and we had to try within a certain time and in line with certain legal decrees to force back and gradually eliminate Jewish influence from economic life. In this connection, I personally always represented the view that, first of all, the process should be carried out slowly, with intervals of time; secondly, that the Jews should be given adequate compensation, and thirdly, that one might leave certain economic interests in their hands, especially their security holdings; and I particularly emphasized this in the meeting with Göring which has been mentioned here so frequently.
Now while these developments were taking shape, the terrible happenings of the night of 9-10 November 1938, originating in Munich, burst upon us and affected me personally very deeply. When I drove to my ministry on the morning of 10 November, I saw on the streets and in the windows of the stores the devastation which had taken place and I heard further details from my officials in the Ministry. I tried to reach Göring, Goebbels, and I think Himmler, but all were still traveling from Munich. Finally I succeeded in reaching Goebbels. I told him that this terror was an affront against me personally, that through it valuable goods which could not be replaced had been destroyed, and that our relations with foreign countries, upon which we were particularly dependent at this time, would now be disturbed noticeably.
Goebbels told me that I personally was responsible for this state of affairs, that I should have eliminated the Jews from economic life long ago, and that the Führer would issue an order to Reich Marshal Göring according to which the Jews would have to be completely eliminated from economic life; I would receive further details from the Reich Marshal. This telephone conversation with Goebbels was confirmed by him later, and witnesses will verify this.
The next day, 11 November, I was informed that there was to be a meeting on the 12th with Göring in his capacity as Delegate for the Four Year Plan, for the purpose of settling the Jewish problem. The Delegate for the Four Year Plan had given instructions to the Ministry to prepare a draft for a decree which was to be the basis of laws for the elimination of the Jews from economic life.
On the 12th this meeting, which has been discussed here frequently, took place. There was a discussion with the Reich Marshal in the morning at which the Gauleiter were present. The Reich Marshal was highly excited; he said that he would not tolerate this terror and that he would hold the various Gauleiter responsible for what had happened in their Gaue.
After this meeting I was therefore comparatively relieved, but at the meeting, of which the record has been read here several times, Goebbels very soon produced his very radical demands and thereby dominated the whole of the proceedings.
The Reich Marshal became increasingly angry and in this mood he gave way to the expressions noted in the record. Incidentally, the record is full of gaps and very incomplete. After this meeting it was clear to me that now indeed the Jews would have to be eliminated from economic life, and that in order to protect the Jews from complete loss of their rights, from further terror, attacks, and exploitation, legal measures would have to be decreed. I made provisions, and so did the Minister of Finance, the Minister of the Interior, the Minister of Justice, and so on, for the execution of the original decree of the Delegate for the Four Year Plan in which the transfer of Jewish businesses and Jewish shares to trustees was stipulated. The Jews were compensated by 3 percent bonds, and I always saw to it that, as far as the Ministry of Economics was involved in this, this decision was carried out faithfully and according to the law and that the Jews did not suffer further injustice. There was at that time certainly no talk of an extermination of the Jews. However, a plan for the organized emigration of the Jews was briefly discussed at that meeting. I personally did not participate in any way in the terroristic, violent measures against Jews. I regretted them profoundly and sharply condemned them. But I had to authorize the measures for the execution of those laws in order to protect the Jews against a complete loss of rights, and to carry through in an orderly manner the legal stipulations which were made at that time.
DR. SAUTER: Dr. Funk...
THE PRESIDENT: We had better adjourn now.
[A recess was taken.]
DR. SAUTER: Witness, before the intermission we last spoke of your activity concerning the decrees for the exclusion of Jews from economic life and you told us about the minutes of the session with Göring on 12 November 1938. That is Document Number 1816-PS.
You have already mentioned that the minutes of that conference were poorly edited and are full of omissions, but we can see from these minutes that you openly and definitely exerted a restraining influence and that you tried to save one thing or another for the Jews. I see, for instance, from the minutes that during the conference you repeatedly maintained that the Jewish stores should be reopened again speedily. Is that correct?
FUNK: Yes.
DR. SAUTER: You also pleaded, according to the minutes, that the Jews should be able to keep their shares and interests. That is shown in a question which you put. Is that correct?
FUNK: I have already said that I had thought, up to the time of that conference, that the Jews could keep their securities; and in the course of the conference I said that it was quite new to me that the Jews should also surrender the securities they possessed. Ultimately they got 3 percent government bonds in settlement, but they had to hand over all their shares and other interests.
I was also against a ruling of that kind because the Government would then take over a huge number of securities and the conversion of such securities was of course difficult.
DR. SAUTER: From the minutes it also appears that Heydrich was in favor of placing the Jews in ghettos, and you recall that the Prosecution has already mentioned that here.
What was your attitude, Dr. Funk, to Heydrich’s proposal at that time?
FUNK: I was against ghettos for the simple reason that I considered a ghetto a terrible thing. I did not know any ghettos, but I said that 3 million Jews can surely live among 70 million Germans without ghettos. Of course, I said that the Jews would have to move together more closely, and one would have to assist the other, for it was clear to me, and I also said so during the conference, that the individual Jew could not exist under the conditions which were now being created for him.
DR. SAUTER: In that connection, Mr. President, may I be permitted to point out two affidavits which I included in the Funk Document Book under Number 3 and Number 15, and may I ask you to take official notice of their complete contents as evidence?
Affidavit Number 3 in the document book, on Page 12 of the text, is one by the defendant’s wife, signed by her about the beginning of the Trial on 5 November 1945. From that affidavit, of which I shall summarize the essential passages, we can see that at the time of the excesses against the Jews in November 1938 the defendant, together with his wife and his niece, was in Berlin, and therefore not in Munich where the so-called “Old Fighters” were assembled and where Minister Dr. Goebbels quite suddenly and to the surprise of everyone gave the order for these Jewish pogroms. Frau Funk confirms in her affidavit that her husband, as soon as he heard of these excesses, called Dr. Goebbels over the telephone in great excitement and asked him:
“Have you gone crazy, Goebbels, to commit such outrages? It makes one ashamed to be a German. Our whole prestige abroad is being lost. I am trying day and night to preserve the national patrimony and you throw it recklessly out of the window. If this beastly mess does not stop immediately, I will throw everything overboard.”
That literally was the telephone conversation which at that time the defendant had from Berlin with Dr. Goebbels. And the remaining contents of that affidavit are concerned with intercessions which the defendant made for individual Jewish acquaintances. And, Gentlemen, there is a similar vein in the affidavit by Heinz Kallus, who was ministerial counsellor in the Ministry of Economics under the Defendant Funk.
I have submitted this affidavit as Number 15 of the Funk Document Book. It is dated 9 December 1945, and this witness also confirms that Funk was, of course, extremely surprised by these excesses, and that he thereupon immediately got in touch with the competent authorities in order to prevent further outrages.
Thus these affidavits largely confirm the account which the Defendant Funk himself has given. In connection with this affair concerning the Jews, I should like to return to Document Number 3498-PS, which can be found on Page 19 of the trial brief against Funk. That is a circular letter by Funk of 6 February 1939, published in the official gazette of the Reich Ministry of Economics, and from it I quote:
“To what extent and rate the authority of the Four Year Plan is to be used depends on instructions given by me in accordance with the directives of the Delegate for the Four Year Plan.”
I quote this because, here again, in an official publication of that time, the Defendant Funk expresses clearly that, in this field too, he had merely to obey and to execute the directives of the Four Year Plan. Is that correct, Dr. Funk?
FUNK: Yes.
DR. SAUTER: Dr. Funk, you said earlier that in keeping with your entire past and your basic principles, and in keeping with your entire philosophy, you considered as particularly severe the charge concerning the elimination of Jews from economic life. And in this connection I want to put to you that during an interrogation in Nuremberg on 22 October 1945, you finally broke into tears and told the interrogating officer, “At that time I should have resigned. I am guilty.” And this was quoted literally on one occasion in the course of the proceedings. Perhaps you can tell us how that remark and that breakdown on your part occurred which I find mentioned in the record.
FUNK: I had at that time just been brought from hospital into prison.
DR. SAUTER: Dr. Funk, one question...
FUNK: I did not know before that I had been accused of being a murderer and a thief and I do not know what else. I was sick for 9 or 10 weeks, and from the hospital bed I was brought here during the night. During those days my interrogations here started immediately. I must admit that the American officer who interrogated me, Colonel Murrey Gurfein, conducted the interrogation with extreme consideration and forbearance and again and again called a halt when I was unable to go on. And when I was reproached with these measures of terror and violence against the Jews I suffered a spiritual breakdown, because at that moment it came to my mind with all clearness that the catastrophe took its course from here on down to the horrible and dreadful things of which we have heard here and of which I knew, in part at least, from the time of my captivity. I felt a deep sense of shame and of personal guilt at that moment, and I feel it also today. But that I issued directives for the execution of the basic orders and laws which were made, that is no crime against humanity. In this matter I placed the will of the State before my conscience and my inner sense of duty because, after all, I was the servant of the State. I also considered myself obliged to act according to the will of the Führer, the supreme Head of the State, especially since these measures were necessary for the protection of the Jews, in order to save them from absolute lack of legal protection, from further arbitrary acts and violence. Besides, they were compensated and, as can be seen from the circular letter which you have just quoted, I gave strict instructions to my officials to carry out these legal directives in a correct and just way.
It is terribly tragic indeed that I in particular am charged with these things. I have said already that I took no part in these excesses against the Jews. From the first moment I disapproved of them and condemned them very strongly, and they affected me personally very profoundly. I did everything, as much as was within my power, to continue helping the Jews. I never thought of an extermination of the Jews, and I did not participate in these things in any way.
DR. SAUTER: Dr. Funk, as you are just speaking of the fact that you did not think of an extermination, an annihilation of the Jews, I want to refer to a document which has been quoted before: Number 3545-PS; it was submitted by the Prosecution. As you may recall, this is the photostat of the Frankfurter Zeitung of 17 November 1938, an issue which appeared only a few days after the incidents with which we are now concerned. In that issue of the Frankfurter Zeitung a speech of yours was published in which you deal with the legal measures for the exclusion of Jews from German economic life, and you will recall that the Prosecutor, in his speech of 11 January 1946, charged you, and I quote: “...that the program of economic persecution of the Jews was only part of a larger program for their extermination.”
And that is in conformity with a phrase in your trial brief which says that it was merely a part of, literally, “a larger program for the extermination of the Jews.” Now, in all the statements which you made during that time, I nowhere find an indication that you favored an extermination, an annihilation of the Jews, or that you had demanded it. What can you say about that view of the Prosecution?
FUNK: Never in all my life, orally or in writing, have I demanded an extermination or annihilation of the Jews or made any statement to that effect. Apparently this is an utterance of the Prosecutor, which, in my opinion, is based only on imagination or the state of mind in which he has viewed the things from the beginning. I myself have never advocated the extermination of the Jews and I did not know anything of the terrible happenings which have been described here. I did not know anything. I had nothing to do with them; and afterwards, as far as I recall, I never took part in any measures against the Jews, since these matters were no longer dealt with in my departments. With the exception of these legal measures, these executive orders, I do not believe that within my departments I ever again authorized anything further connected with Jewish affairs.
DR. SAUTER: Is it correct, Dr. Funk, that in connection with the carrying out of these directives which you had to issue, you yourself intervened on behalf of a large number of individuals who had to suffer under these directives and who approached you personally for aid, and that you did this in order to mitigate the effect of these decrees?
FUNK: I saw to it that these directives were followed in a fair way and according to the laws. However, the carrying out of these decrees was the responsibility not of the Ministry but of the district president and of the offices dependent on the Gauleiter in the Reich. Many complaints reached me about the manner in which Aryanization was carried out, and my officials will confirm that I intervened in every case when I was informed of such abuses. I even dismissed an official of that department when I heard of incorrect behavior; later I also parted with the department head.
DR. SAUTER: Why?
FUNK: Because these abuses had occurred. Just as previously I had done everything in my power to aid the Jews to emigrate by making foreign currency available to them, so now, in carrying out these directives, I did everything in my power within the scope of possibility to make things bearable for the Jews.
DR. SAUTER: Mr. President, this question as to what Funk’s attitude was in practice toward the carrying out of these decrees which he himself as an official had to issue—this question I have also treated in a questionnaire approved by you, which has been submitted to the former State Secretary Landfried. That questionnaire was returned some time ago but it was discovered that a wrong questionnaire had been sent out by the office, and the correct answer was received only on Saturday. It is now being translated and I assume that this correct answer, this testimony of State Secretary Landfried, will be submitted to you in the course of the day and that it can then be entered in the appendix as Document Number 16. I presume, nevertheless, that there will be no objection to my reading the short answer of the witness Landfried in connection with this matter. Herr Landfried was from 1939 to 1943 state secretary...
THE PRESIDENT: Has the Prosecution seen the document?
DR. SAUTER: Yes, the Prosecution has the document.
MR. THOMAS J. DODD (Executive Trial Counsel for the United States): We haven’t seen this document. We have seen the German text. I don’t read German and I haven’t had an opportunity to read it. It hasn’t been translated.
THE PRESIDENT: The document can be submitted after the Prosecution has seen it. You needn’t submit it at this moment. Have you any other witness or not?
DR. SAUTER: Not in connection with this topic.
THE PRESIDENT: No, no, but are there any other witnesses at all?
DR. SAUTER: One witness, Dr. Heidler, but for other subjects.
THE PRESIDENT: And presumably the defendant will be cross-examined.
DR. SAUTER: Yes.
THE PRESIDENT: These documents will be translated by then.
DR. SAUTER: Yes. Mr. President, if you so desire, then I will have to submit that document later, separately.
THE PRESIDENT: Yes.
DR. SAUTER: Dr. Funk, I come now to an accusation which, according to my knowledge, has not been mentioned in the trial brief yet; it concerns the problem of the occupied territories, that is, the spoliation of the occupied territories, costs of occupation, clearing systems, stabilization of currency, and the like. The Prosecution asserts that you actively participated in the program of criminal exploitation in the occupied territories. That can be found in the record of the proceedings on 11 January 1946 (Volume V, Page 167). That accusation is not further specified, but in the session of 21 February (Volume VIII, Page 60) there is a mere reference to a decree of the Reich Minister for the Occupied Eastern Territories, the Defendant Rosenberg. That decree was submitted by the Prosecution as Document Number 1015-PS; it is a decree by the Minister for the East, Rosenberg, to the Reich commissioners in the Occupied Eastern Territories. The decree informs the Reich commissioners of the task of the Einsatzstab Rosenberg—it has already been mentioned here on several occasions—namely, that of safeguarding objects of cultural value. I think I may assume that the Reich Ministry of Economics had nothing to do with cultural treasures as such. But—and that is very peculiar—it appears from Rosenberg’s letter of 7 April 1942 that a copy of it went not only to various other offices but also to you, that is to say, to the Reich Minister of Economy. And from that fact—apparently from that fact alone—the Soviet prosecutor has deduced the charge that you actively participated in the spoliation of the occupied territories. I had to explain the connection in such detail in order to show exactly with what we are dealing. Can you speak quite briefly about it?
FUNK: Up to the time of this Trial I did not even know what the Einsatzstab Rosenberg was, what its tasks were, what it was doing. I have no knowledge that the Ministry of Economics had anything at all to do with the safeguarding of cultural treasures. I cannot say anything about it.
DR. SAUTER: You cannot say anything about this?
FUNK: No, not with regard to the Einsatzstab Rosenberg. About the policy in the occupied territories, I can say a great deal...
DR. SAUTER: That does not interest us now.
FUNK: But you will probably want to hear that later.
DR. SAUTER: Then, Dr. Funk, in the questionnaire sent to Dr. Landfried which I have mentioned before, I asked five or six questions concerning your attitude to the economic policies in the occupied territories. I also put questions to him on whether you had given directives to the military commanders or the Reich commissioners for the occupied territories, or the heads of the civil administration in Alsace-Lorraine, and so on. Furthermore, I asked whether it is correct that economic directives also for the occupied territories did not come from you as Reich Minister of Economics but from the Delegate for the Four Year Plan. Then I asked about your attitude toward the question of exploitation of occupied territories, particularly in the West, the black market, devaluation of currency, and the like.
I cannot read the statements of the witness Landfried at this moment, because, through an error in the office, the answers from Landfried arrived only last Saturday. Since your personal testimony is now being heard, do you yourself wish to add anything to these questions, or would you just like to underline what I shall submit to the Tribunal as soon as I have received the translation? I put this question because it is practically the last opportunity for you to refer to these subjects.
FUNK: I should like to state my position on various matters, but the details of these problems can naturally be better explained by the state secretaries than by myself.
Concerning the directives to occupied territories, the Reich Marshal, as well as Reich Minister Lammers, has stated here that I, as Reich Minister for Economics, had no authority to issue instructions. The Reich Marshal, during his testimony here, stated, and I marked it down, “For the directives and the economic policies carried out by the Minister of Economics and Reichsbank President Funk, the responsibility is fully and exclusively mine.”
And concerning the occupied territories, he also said that if I had issued special instructions in the course of official business between the ministry and the administrative offices in the occupied territories, then they derived from the general directives of the Reich Marshal and, as he said, were always based on his personal responsibility.
The position was that directives to the occupied territories in the economic field could only be given by the Delegate for the Four Year Plan. The carrying out of economic policy was the task of the military commanders or the Reich commissioners who were directly subordinate to the Führer. The military commanders, as well as the Reich commissioners, had under them officials from the various departments; among them, of course, also officials from the Ministry of Economics and the Reichsbank; and even private enterprise was represented. There was, of course, close co-operation between the offices of the military plenipotentiaries, the Reich commissioners, and the representatives of the various home departments, with the exception of occupied territories in Russia where the Reich commissioners were subordinate to a special minister, that is, the Reich Minister for the Occupied Eastern Territories. This was an exception, but if we as a ministry wanted to have anything done by the military commanders or the Reich commissioners, we had to make a request or procure an order from the Delegate for the Four Year Plan.
The same applies to the heads of the civil administration in Alsace-Lorraine and in other territories where a civil administration had been set up. Here also, the numerous departments of the Ministry of Economics and the Reichsbank had no direct authority to issue directives.
However, I emphasize again that of course close official contact existed between the directing authorities in the occupied territories and the respective departments in Germany.
I myself—and witnesses will confirm this in questionnaires still outstanding, or in person—made the greatest efforts to protect the occupied territories from exploitation. I fought a virtually desperate struggle throughout the years for the maintenance of a stable currency in these territories, because again and again it was suggested to me that I should reduce the exchange rate in the occupied territories so that Germany could buy more easily and more cheaply in these countries; I did everything that could be thought of to maintain economic order in these territories. In one case, in Denmark, I even succeeded, in the face of opposition from all other departments, in raising the value of the Danish krone, because the Danish National Bank and the Danish Government requested it for justifiable reasons.
I opposed the increase of occupation costs in France in 1942 as well as in 1944. The memorandum of the Reichsbank which I authorized was quoted here by the American Chief Prosecutor.
The occupation costs were determined not by the Minister of Economics and the President of the Reichsbank but by the Minister of Finance and the Quartermaster General—in other words, by the highest Wehrmacht commands—and in the case of France, Denmark, and other countries, also by the Minister for Foreign Affairs.
Therefore, I did whatever I could possibly do—whatever was within my power—to keep the economy of the occupied territories in good order. I was successful finally in persuading the Reich Marshal to issue a decree which prohibited all German personnel from buying on the black market; but that happened only after many abuses in this respect had already occurred.
I want to emphasize also that I considered it necessary for the maintenance of order in the occupied territories that social life there should not be disturbed, and that, therefore, as a matter of principle I was always against the forced or excessive deportation of foreign workers from the occupied territories to Germany.
I also expressed this in a conference with Lammers, which has been mentioned here. My state secretaries can confirm that. On the other hand it was naturally clear to me that Sauckel was in a very difficult, indeed desperate, situation. Again and again manpower for German economy was demanded of him. But, particularly after I had turned over the entire civil production to Speer and engaged in central planning, it was not only not to my advantage, from the point of view of my work, that manpower was brought to Germany from abroad, but it was indeed in my interest that the workers should remain in the occupied territories since the production of consumer goods had been transferred to a large degree to these territories; for as minister responsible for providing consumer goods to the population I had a great interest in seeing that orderly work should be done in the occupied territories and that no economic or social disturbances should occur.
I believe, however, that it will be more to the purpose if my two state secretaries and the Vice President of the Reichsbank, the acting Director of the Reichsbank, Puhl, make detailed statements on these problems, because they were more closely connected than I with carrying matters into practice.
If the accusation is made against me that with the aid of the clearing arrangements we spoliated occupied territories and foreign countries, I can only say that the clearing arrangement was not originally introduced by us in our dealings with the occupied territories or during the war, but that it was the normal method of trade between Germany and her business partners. It was a system which had been forced upon us—and that has been pointed out by Schacht—when other nations resorted to using the proceeds of German exports for the payment and amortization of German debts.
At all times, however, I have emphasized that the clearing debts were real debts for merchandise, and that is important. I have said again and again that this clearing debt was a genuine debt of the Reich and would be repaid at the rate, the purchase value which was in force at the time when we entered into these obligations. I especially stated that, in detail and as clearly as possible, in my last speeches in Vienna in March 1944, and in Königsberg in July 1944.
Beyond that, in July, I made the suggestion that after the war the clearing debt should be transformed into a European loan, so that it should not remain on the narrow plain of a bilateral exchange of goods but be effectively commercialized; from this can be seen distinctly that I always considered that clearing debt a genuine debt, so that the nations in the occupied territories who had such claims on Germany could and would be satisfied with the war—and, as I constantly emphasize, at the same rates that existed at the time when the debt was incurred. If, however, the countries would have had to pay reparations on the basis of peace treaties, then these reparations of course, quite reasonably, could only have been paid in goods; and then, equally reasonably, it would have been possible to create a balance between German debts and German claims.
But I never left any doubt about the fact that the clearing debt was to be considered a true debt. Therefore, I have to reject the accusation that with the aid of the clearing system we exploited the occupied territories. And I have to reject even more strongly the accusation that I share responsibility for the burden of unbearable expenses, particularly occupation costs and other outlays of money, which were imposed on the occupied territories. It can be proved that I always objected to excessive financial burdening of the occupied territories. The witnesses will later testify and confirm this.
DR. SAUTER: Mr. President, the defendant has referred to two speeches which he made in Vienna and in Königsberg. These are two addresses which deal in part with the subject of clearing debts, and in part also with the defendant’s favorite subject of a European economic union between Germany and her neighbor nations, that is to say, an economic union on the basis of full equality.
In the interest of time, may I just ask that judicial notice be taken of these speeches, the essential content of which has been stated partly by the defendant and partly by me: The speech of the defendant at Vienna on 10 March 1944, Number 10 in my document book, and the speech in Königsberg on the occasion of the 400th anniversary of the university of his home province, on 7 July 1944, Number 11 in my document book.
MR. DODD: Mr. President, if this Document Number 11 is offered by the defense for the purpose of showing what this defendant’s policy was toward the occupied countries, then I think it is proper for me to point out that the speech did not refer to the occupied countries but rather to the satellite states of Germany.
DR. SAUTER: Mr. President, may I also call attention to Document Number 3819-PS, which has already been submitted by the Prosecution. That is the record, which the defendant has mentioned, of the meeting with Minister Lammers on 11 July 1944.
According to this record, the Defendant Funk was present at that meeting, and mention is made of him in one sentence only; I quote, on Page 8 at the bottom: “Reich Minister Funk expects considerable disturbances of production in non-German territories in case of ruthless raids.”
This sentence, if taken from its context, is difficult to understand, but viewed in its proper connection, it makes it clear that the Defendant Funk wanted to warn against violent action in the recruitment of foreign workers for German production and for German armaments. He warned against any violent measures—against raids, as they are called in the protocol, because thereby, in his opinion, production in the occupied territories would be disturbed.
Then, Mr. President, may I mention another document. It is Document Number 2149-PS, and it contains the following: A statement of the Reichsbank, dated 7 December 1942, “concerning the question of increasing French contributions to occupation costs.”
May I say in advance that the cost of occupation in France was increased, but not upon the suggestion of the Defendant Funk and not with his approval, but in spite of his protest. And this statement to which the Defendant Funk has referred, and which I have just quoted—it is dated 11 December 1942—lists in detail the reasons why Funk and his Reichsbank very definitely protested against any increase in the cost of occupation.
In this connection, may I be permitted to question the Defendant Dr. Funk on the cost of occupation in Greece.
[Turning to the defendant.] Did you hear the testimony of the witness Dr. Neubacher, who was Minister to Romania and Greece, and who confirmed that there, also, you tried to reduce the cost of occupation?
THE PRESIDENT: Are you going to be much longer?
DR. SAUTER: Yes, I believe, Mr. President, it would be better if we adjourned now. I still have to put a few questions.
[The Tribunal recessed until 1400 hours.]
Afternoon Session
THE PRESIDENT: The Tribunal will adjourn this afternoon at half-past four.
DR. SAUTER: Witness, I would like to return to the question of the so-called spoliation of the occupied countries. As Reich Minister of Economics, which you were at the time, you can certainly inform us from your personal experience and observation of the contribution of the occupied territories to Germany’s war effort.
FUNK: The achievements of the occupied territories for the joint carrying on of the war were without doubt of great significance. I have always regarded the occupied territories synchronized with the total German economy as one great productive organism for carrying on the war, which would lead to a new order in Europe. Usually the same basic economic principles applied in the occupied countries as in Germany. In 1944 I had statistics compiled to show just how much the occupied countries had produced for the war effort in the 3 years of 1941, 1942, and 1943, and we reached the figure of 90,000 million Reichsmark. That is certainly an extraordinarily high figure, but one must not forget that the currencies of the various countries were converted into Reichsmark. That is, the reduced purchasing power of the various currencies is not expressed in these figures. In truth, therefore, the production is lower than these Reichsmark figures might show.
At the same time Germany utilized at least two-thirds of her entire production, that is, about 260,000 million marks worth, for the European war effort, in other words, almost three times as much as the occupied countries. Almost up to the time of the invasion I succeeded, in the case of France, in regulating the financial and monetary system and thus also the economic and social order to such an extent that, at the end of the German occupation, French finances were actually much healthier than German finances, and if it had not been for the circumstances resulting from the elementary impact of the war, France would have been able to construct a healthy monetary system on this basis.
My statistics are confirmed to a certain degree by a document which was submitted here. This is Exhibit RF-22 (Document Number F-515), and deals with the French deliveries to Germany. It is an official report to the French Government about forced labor in France. In this report there are tables on Pages 38, 39, and 40 showing the amount of French deliveries to Germany in proportion to the entire French production. These figures show that out of the entire French production with which we are dealing, in these three years an average of 30 to 35 percent was sent to Germany for the joint war effort. In some fields, and especially those which are necessary for the provisioning of the French population, such as textiles, pharmaceutical supplies, gas, electricity, and so forth, these figures are considerably lower and in some cases amount to only 5 or 6 percent. But as an economist I admit without hesitation that if these matters are not regarded from the point of view of the joint carrying on of the war and the joint economic relationship, a deduction of 35 percent means a lot and must naturally have serious repercussions for the entire economy.
I have no specific figures at hand for the Russian territories. The Ministry of Economics itself was entirely excluded from the war economy of these territories; we merely attempted to allow certain firms or companies to operate in these territories as private enterprises there, that is to say, they were to buy and sell at their own risk. I did not participate otherwise in the management of these regions outside of the fact that I was chairman of the supervisory board of the Continental Oil Company, which operated in these regions in conformity with the provisions of the Four Year Plan and the orders of the Wehrmacht. But I personally, as chairman of the supervisory board, had only to manage the financial affairs of this company.
DR. SAUTER: Witness, at the end of this morning’s session you spoke of the so-called Central Planning Board, a body about which we have heard a good deal. You stated, although quite briefly, that as Minister of Economics you had no interest in the fact that foreign workers were transported to Germany, no matter whether for armament or other purposes. Did I understand you correctly?
FUNK: That applies to the time when I became a member of the Central Planning Board.
DR. SAUTER: When was that?
FUNK: I was called into the Central Planning Board in the fall of 1943, when I turned over all production matters to Speer and when, for the first time, on 22 November 1943 I attended a session of the Board. At that time I not only had no interest in having foreign workers brought to Germany but actually, from the economic aspect, I wanted to have the workers remain abroad, for the production of consumer goods had, to a large extent, been shifted from Germany to the occupied countries so that in other words this production, that is, French production or Belgian production, could work unhindered for the German populace; I did not want the workers taken away, and particularly I did not want them to be taken away by force, for in that way the entire order and the whole social life would be disturbed.
Before that time, as Minister of Economics, I was naturally interested in seeing that the German economy had workers. However, these questions were not dealt with in the Ministry of Economics, but either in the Four Year Plan, where a Plenipotentiary General for Labor had been active from the beginning...
THE PRESIDENT: [Interposing.] Surely we heard all this this morning. It was all given this morning.
DR. SAUTER: In connection with the Central Planning Board, perhaps I might refer to one more document, Mr. President.
[Turning to the witness.] And this, Witness—and please confine your answer to this letter only—is a letter which you once wrote to Field Marshal Milch and which was submitted, I think, by the French Prosecution as Exhibit RF-675, (Document Number RF-675). In this letter, Herr Funk, you apologized for participating so very infrequently in the meetings of the Central Planning Board. And at that time you sent two experts from your ministry to the session, that is, two experts in the field of administrating civilian supplies and of the export trade. As deputy of your State Secretary, Dr. Hayler, who will be called later as a witness, a certain Ohlendorf participated at this meeting of the Central Planning Board. You have already seen this man, Ohlendorf, in this courtroom on the witness stand. I should be interested to know what were the functions of this man Ohlendorf who apparently belonged to your ministry.
FUNK: As far as the negotiations of the Central Planning Board were concerned, I was essentially interested only in the fact that in that meeting the necessary raw materials were allocated for the administration of consumer goods and the export trade. For that reason Ohlendorf and two other experts for the administration of consumer goods and the export trade were sent to the meeting. Ohlendorf was brought into my Ministry by State Secretary Hayler. Before that I had only known Ohlendorf vaguely from one or two meetings and I had had an extraordinarily favorable impression of him, for he had an extremely lucid mind and could always express his thoughts in a most impressive way. Before that time I didn’t even know that Ohlendorf had another position in the Reich Security Main Office, for he was introduced to me as a manager of the Main Organization for German Trade. Hayler was the chief of this organization, of the Reichsgruppe Handel, and Ohlendorf was his manager and was introduced to me as such. Therefore I had no objections to Ohlendorf being brought into the ministry and taking over that field which corresponded to his private business activities up to now—the province of administration of consumer goods.
Then through Hayler I discovered that Ohlendorf was active also in the RSHA—or whatever the name is—as an office chief in the SD. However, I took no exception to this activity, for I was not fully acquainted with these assignments and in any case I was not convinced that anything was taking place which was unacceptable for the Ministry. Ohlendorf was active chiefly as manager of the Reichsgruppe Handel. As far as I know, he only had an auxiliary occupation in the RSHA, or however it was called. Naturally I was very much affected and painfully surprised when I heard here about assignments which Ohlendorf with his “Einsatzstab” had had in previous years in Russia. I had never heard one word about this activity of Ohlendorf. He himself never mentioned these things to me and until this time I did not know the type of assignments such “Einsatzstäbe” had.
Ohlendorf never talked about his activity in the SD. Hayler, who knew him much better and more intimately than I did, is better qualified to give information. In any event I knew nothing of this activity of Ohlendorf, which after all he had carried on in years prior to this date, and I was very much affected to find that this man had done such things.
DR. SAUTER: Witness, I must ask you to state your position in regard to the testimony given by another witness, whom we have seen and heard in this courtroom. This witness is Dr. Blaha, who made a report in this courtroom about the conditions in the concentration camp at Dachau and who testified—as you probably will recall—that in and around Dachau it was common talk that the Reich Minister of Economics, Dr. Funk, had also been present at one of these official visits to the camp. As you recall, this witness replied to my question that he himself had not seen you, but that your name had been mentioned in this connection by other inmates. Were you ever at Dachau or at any other concentration camp?
FUNK: No, I was neither at Dachau nor in any other concentration camp.
DR. SAUTER: Can you say that with a clear conscience under your oath?
FUNK: Yes.
DR. SAUTER: The witness, Dr. Blaha, has also testified to the fact that this inspection of Dachau took place following a discussion among the finance ministers which had taken place at Berchtesgaden or Reichenhall, or somewhere in that vicinity. Therefore I ask you: Did you ever participate in a meeting of finance ministers, or at least at the time Blaha claims?
FUNK: No, I never participated in a meeting of finance ministers, because I myself was never such a minister. And at that time I did not participate in any international discussions at all. No.
DR. SAUTER: Dr. Funk, as far as your health is concerned, this is not a good day for you. You have complained about the bad pains which you are suffering today. Consequently, I do not wish to put any further questions to you, except one in conclusion, which I am sure you will be able to answer briefly.
Why did you remain in your office as Reich Minister of Economics and as President of the Reichsbank until the very end?
FUNK: I considered myself bound to remain in this position as long as I could, in order to serve and be of use to my people. It was precisely during the last few years of the war that my position was a very difficult one. The administration became greatly disorganized and I had to make exceptional efforts in order to procure supplies for the people, especially those who had been bombed out. I continually had to protect the supplies and supply depots from arbitrary seizures by the Gauleiter. In the case of one Gauleiter, I had to call the police. I did not follow the “scorched earth” policy which the Führer had decreed, so that even after occupation by the enemy powers the supplies which were left could be used by the German people.
I had had instructions from the Führer to issue a decree according to which the acceptance of allied invasion currency would be high treason and punishable by death. I did not issue that decree. I made every effort to prevent State property and State money from being destroyed and wasted. I saved the gold deposits and foreign exchange deposits of the Reichsbank which were in the greatest danger. Briefly, until the last minute I believed it was my duty and responsibility to carry on in office and to hold out until the very end. Especially when we Germans learned that, according to the Morgenthau Plan, the status of the German people was to be degraded into that of shepherds and goatherds; that the entire industry would be destroyed, which would have meant the extermination of 30 million Germans. And especially after Churchill had declared personally that the German people would suffer from hunger and that epidemics would break out, only one thing was possible for me and for every decent German, and that was to remain at his post and do everything within his power in order to prevent this chaos.
I had no talent for being a traitor or a conspirator, but I always loved my fatherland passionately and my people as well, and up to the end I tried to do everything possible to serve my country and my people and to be of use to them.
DR. SAUTER: Mr. President, perhaps in connection with this alleged visit to a concentration camp I might refer to a questionnaire which we received from the witness Dr. Schwedler, and which is found in the supplementary volume for the Funk case as Document Number 14. This affidavit, of the contents of which I would like to have you take official notice, essentially confirms that, since 1 February 1938, the witness Dr. Schwedler was the daily companion of the Defendant Funk; that Dr. Funk never visited a concentration camp; and that the witness would have to know of it if it were the case.
With these words, Mr. President, I conclude my examination of the Defendant Funk. I thank you very much.
THE PRESIDENT: Do any of Defendants’ Counsel wish to ask questions?
Dr. Sauter, you said you were referring to an affidavit of Dr. Schwedler? Which was Number 14? You said you were referring to Dr. Schwedler’s affidavit which you said was Number 14 in your supplementary book. It does not seem to be in ours.
DR. SAUTER: I beg your pardon, Mr. President, it is Number 13. I made a mistake. It is Number 13; in the supplementary volume, Number 13, Dr. August Schwedler. It is a questionnaire.
DR. OTTO NELTE (Counsel for Defendant Keitel): Witness, I have one question which I would like to put to you. The Prosecution has accused the Defendant Keitel as chief of the OKW, you as Plenipotentiary for the Economy and Minister Frick as Plenipotentiary for Administration, on a common ground. The men in these three offices are mentioned in the Reich Defense Law of 1938. Undoubtedly, they probably exerted certain functions which might be of significance. The Prosecution in this connection spoke of a Three Man College and attributed much authority and significance to this Three Man College in connection with the point the Prosecution is making of the planning and preparation of aggressive wars.
Now I ask you: Was there such a Three Man College and what were the functions of these three offices which have been mentioned, according to the Reich Defense Law?
FUNK: Due to the confusion reigning in the German administration we ourselves could scarcely keep things straight; so it is not surprising if the Prosecution is in error on this point. I myself never heard of this three-man committee or Three Man College until this proceeding. I did not know that I belonged to such a three-man committee or Three Man College or triumvirate or anything else. On the basis of the Reich Defense Law similar powers were given to the Chief of the OKW, to the Plenipotentiary for Administration and to the Plenipotentiary for Economics. These three, in deviation from the existing laws, could issue directives in which they had mutually to participate.
But it was the purport of this order that these directives could only be of a subordinate nature, which on the whole applied solely to the sphere of activity of the offices involved. Legislation for more important matters was made either by the Ministerial Council for Defense of the Reich—later only by way of circulating the bill from one minister to the other—or by Führer decrees. As far as I know there were only three, four, or five meetings of this body. Later, the decrees of the Führer were the real, the essential way of issuing laws. They were issued by the Führer personally, and the offices involved were frequently only informed of the same. Therefore the three-man committee is only a fiction.
DR. NELTE: Thank you. I have no further questions.
DR. DIX: Dr. Funk, you spoke of the law for the regulation of national labor and you said that that law was issued under your predecessor. You spoke about “my predecessor.”
FUNK: No, you are wrong; I said “predecessors.”
DR. DIX: Predecessors. Can you tell the Tribunal under which Reich Minister of Economics that was issued?
FUNK: This law was issued under Reich Minister of Economics Dr. Schmitt, as far as I remember. And the subsequent agreement with the German Labor Front probably took place in part under Schacht. I particularly remember the so-called Leipzig Resolutions.
DR. DIX: Then you also mentioned that there was an office subordinate to Schacht as Plenipotentiary for War Economy. You will remember that the witness Vocke denied the existence of such an office of Schacht’s as Plenipotentiary of War Economy, and Schacht did the same thing. Which office did you mean? Describe the office that you mean.
FUNK: It was not an office in the sense in which it might have been interpreted here. It was a committee of experts of the various departments which was led by the representative of the Plenipotentiary for War Economy, who was Schacht, and later by my representative as Plenipotentiary for War Economy. Under Schacht’s term of office it was State Counsellor Wohlthat and in my term of office it was Schacht’s former State Secretary, Posse.
DR. DIX: Certainly. Now is it identical with the working committee which originated on the basis of the old Reich Defense Law and which existed before 1933?
FUNK: I am not familiar with that.
DR. DIX: In any event, this working committee was composed of the various departments?
FUNK: Yes.
DR. DIX: Together with the OKW?
FUNK: With the OKW, with the Ministry of the Interior, and later, with the decisive participation of the Four Year Plan representative.
DR. DIX: And the expert for Schacht during Schacht’s term was Dr. Wohlthat?
FUNK: As far as I know, yes.
DR. DIX: Then one more question. You talked about the so-called triumvirate with reference to a question by my colleague for the Defendant Keitel. The creation of the triumvirate, this activity which you have described, was after Schacht’s time, I believe.
FUNK: Yes, I believe so. But there was no activity.
DR. DIX: No.
FUNK: I never participated in any session of the so-called Three Man College.
DR. DIX: No. You said it was a fiction.
FUNK: Furthermore, no meeting of these three men ever took place.
DR. DIX: No; you said it was a fiction.
DR. ROBERT SERVATIUS (Counsel for Defendant Sauckel): I have a question regarding the wages of the foreign workers. Did Sauckel make any special efforts in connection with the transfer of the wages? Do you know anything about that?
FUNK: Yes. Sauckel insisted very frequently at the Reichsbank and the Reich Ministry for Economics that there should be a large-scale transfer of wages to foreign countries and the occupied territories. Naturally we were in a very difficult position here, because especially in the southeastern European countries the currencies had been greatly devaluated, and the purchasing power of German money had sunk considerably, whereas I maintained the stable rate of exchange so that the inflationary tendencies in these countries would not be strengthened and result in complete economic chaos through the fault of the currency control. Therefore we had to make additions to the payments to make up somewhat for the devaluation of the money in the occupied and other countries. Altogether, considerable sums were transferred. I would estimate these sums to be at least 2,000 million Reichsmark.
DR. SERVATIUS: Do you know whether Sauckel tried to do something about the clothing for foreign workers? Was anything done?
FUNK: He made considerable efforts, and this was particularly hard on the Ministry of Economics, because with the small amount of raw materials which the Central Planning Board had made available this Ministry had to take care of the population, and through the ever growing number of people bombed out we received ever greater demands for supplies. Yet, in spite of that, we tried to comply with the demands of Sauckel as far as possible, but of course we could not do so entirely.
DR. SERVATIUS: To what extent was clothing material delivered? Can you give any figures?
FUNK: No, I cannot.
DR. SERVATIUS: Do you know anything about Sauckel’s attitude towards Himmler, since, according to the Prosecution, he collaborated with him?
FUNK: I remember one particular incident. When I had fled to Thuringia with my gold reserve and the rest of my foreign exchange I called on Sauckel one evening; State Secretary Keppler, who has been mentioned here frequently, was also present.
In the course of the conversation Sauckel and Keppler got into a terrific dispute with Himmler. Sauckel told Himmler quite plainly that he had destroyed the administrative unity in Germany; that he was mainly responsible for the disorganization of the German administration, for through the SS he had created a state within a state. Sauckel said further, “How can the people keep discipline if the top men of the Reich themselves cannot keep discipline?”
DR. SERVATIUS: I have no further questions.
DR. EGON KUBUSCHOK (Counsel for the Defendant Von Papen): Is it true that after Von Papen’s speech at Marburg in June 1934 Hitler asked you to go to Reich President Von Hindenburg at his country estate in Neudeck and to tell him the following:
Vice Chancellor Von Papen, because he was forbidden to make his speech public, had asked to be allowed to resign. This resignation would have to be granted, because Von Papen through his speech at Marburg was guilty of a severe breach of Reich Cabinet discipline.
FUNK: When Reich President Von Hindenburg was at his estate at Neudeck he frequently invited me to visit him. I have already mentioned that I associated with him on familiar terms. A visit like this took place when the matter of the Von Papen speech at Marburg arose, and the Reich Marshal suggested to the Führer, as far as I recall, to have me inform the Reich President about this incident. The Führer had me do this, and I told the Reich President that a conflict had arisen between the Führer and Von Papen because of a certain speech. I did not know the contents of this speech, since in the meantime its publication had been forbidden. Then the Reich President simply replied, “If he does not maintain discipline, then he must be prepared to take the consequences.”
DR. KUBUSCHOK: Thank you.
DR. HEINZ FRITZ (Counsel for Defendant Fritzsche): Witness, when and where did you meet your Codefendant Fritzsche?
FUNK: When he was active in the press section of the Propaganda Ministry. One day he appeared before me and wanted money for “Transocean,” and I granted him this money.
DR. FRITZ: You were State Secretary in the Propaganda Ministry at that time?
FUNK: Yes.
DR. FRITZ: That was in what year?
FUNK: That must have been in 1933 or 1934.
DR. FRITZ: When he came to you, did you know what position Fritzsche had in the Propaganda Ministry at that time?
FUNK: I knew that he was in the press section.
DR. FRITZ: Was this a leading position which he had? Was he perhaps head of a department?
FUNK: No. At that time the head of this department was Dr. Hahnke as far as I remember. Later it was Berndt.
DR. FRITZ: Could you observe whether Fritzsche was in any close contact with Dr. Goebbels?
FUNK: I was never called in to attend any of the discussions which Dr. Goebbels had daily with his experts. That was done through his personal assistant, Dr. Hahnke who later became State Secretary. But since Fritzsche was not the head of a department I assume that he was not called in to these discussions either. As far as I know mostly the heads of departments were called to these discussions, but certainly not Fritzsche.
DR. FRITZ: Then according to your knowledge, in your capacity as State Secretary at that time, he was not one of the closer collaborators of Dr. Goebbels, if I understood you correctly.
FUNK: At that time I do not believe so. Of course, I do not know what took place later.
THE PRESIDENT: The Prosecution?
MR. DODD: Witness, can you hear me?
FUNK: Yes.
MR. DODD: We have listened to your testimony since late Friday afternoon, and, as we understand it from your statements, you admit none of the charges made against you in the Indictment in any degree, with possibly one exception; I am not clear as to whether or not you were making an admission this morning with respect to your part in the persecution of the Jews. Would you tell us now whether or not you intended to admit your own guilt or the part that you played in the persecution of the Jews?
FUNK: I said this morning that I had a deep sense of guilt and a deep sense of shame about the things which were done to the Jews in Germany, and that at the time when the terror and violence began I was involved in a strong conflict with my conscience. I felt, I could almost say, that a great injustice was being done. However, I did not feel guilty in respect to the Indictment against me here, that is, that according to the Indictment I was guilty of Crimes against Humanity because I signed the directives for carrying out laws which had been issued by superior offices—laws that had to be made so that the Jews would not be entirely deprived of their rights, and so that they would be given some legal protection at least in regard to compensation and settlement. I am admitting a guilt against myself, a moral guilt, but not a guilt because I signed the directives for carrying out the laws; in any event not a guilt against humanity.
MR. DODD: All right. That’s what I wanted to thoroughly understand. You also told the Tribunal, that you—I think you used the expression “often at the door but never let in,” and I understand that to mean that in your own judgment you were really a little man in this Nazi organization. Is that so?
FUNK: Yes...
MR. DODD: All right. That’s an answer. You might want to explain it later, but for the present purposes that will do.
FUNK: May I give an explanation to this. I wanted to state that in the position I held, there were always higher authorities which made the final decision. That was the case in all the positions I held in the State.
MR. DODD: Well, let’s both examine some of the evidence, and see whether or not you were in fact always subordinated and always a little man who didn’t get in.
First of all, there’s one matter that I do want to clear up before going into the general examination. You recall when the Defendant Schacht was on the stand, he told the Tribunal that after he left the Reichsbank he had an office in his apartment, is that so?
FUNK: Yes, he said that.
MR. DODD: Now of course you have told us, on another occasion, that he continued to have an office in the Reichsbank. Isn’t that so?
FUNK: I don’t know whether I said and where I said that, but it may be so. I was informed, at the time when he resigned, that he still went to the Reichsbank rather frequently, and that a room was reserved there for him. In addition he still had some personnel, a secretary whom he had taken with him from the Reichsbank—and that is all I know.
MR. DODD: Another question. You told us, on another occasion, that he had an office in the Reichsbank where he worked on certain bank data and where he still kept in touch with you every now and then. Isn’t that so? Do you remember telling us that or not?
FUNK: No, it wasn’t like that. Schacht seldom...
MR. DODD: If you don’t remember, then I perhaps can help you a little bit. Do you remember being interrogated by Major Hiram Gans of the United States Army on June 2, 3, and 4 of 1945? Do you remember that? You know who was there—Göring was there, Von Krosigk was there, Lammers was there....
FUNK: Yes.
MR. DODD: All right. You were asked this question, weren’t you, or rather, preceding this answer there were some questions?
Question: “Did Schacht retain any governmental position after his dismissal as President of the Reichsbank?” Then Göring put in an answer: “Reich Minister.” Then another question: “Did he have any functions?” Göring again answered: “He remained Minister without Portfolio.” Then another question: “Were there any Cabinet meetings he attended?” Göring answered again: “There were no Cabinet meetings at that time.” Question: “Then it was purely honorary?” Göring said: “Practically.”
Then you interposed with this statement (Funk is speaking): “Schacht, after his dismissal, kept an office in the Reichsbank, where he worked on statistical data of the Reichsbank and where he still kept in touch with me every now and then.” Question: “How long did this last?” Answer: “This lasted until Schacht’s dismissal as Minister, probably in 1943.”
You made those answers, that answer, did you not?
FUNK: That is not correct. I did not express myself that way. I said only that I had been informed that he came to the Reichsbank frequently, that there was a room reserved for him and that he very seldom spoke to me. He seldom called on me. That was not translated correctly.
MR. DODD: You know what I am reading from, do you not? You know this Document, Number 2828-PS?
FUNK: No.
MR. DODD: Parts of this are already in evidence as Exhibit USA-654. And later, in another form, I shall submit this part which I have just read.
Counsel Sauter, for you, this morning referred to a letter which you had written to Hitler, I believe it was in 1939, a very fulsome letter which you said was somewhat due to the general feeling at the time and also to the fact that it was about your 50th birthday. Is that so? There was another reason for your writing that letter in connection with your birthday, wasn’t there? Do you know to what I refer?
FUNK: Yes.
MR. DODD: You received 520,000 Reichsmark from Hitler as a birthday present?
FUNK: No, that is not correct.
MR. DODD: Didn’t you receive a present from Göring and Goebbels...
FUNK: Yes...
MR. DODD: Wait a minute till I get through—you don’t seem to remember—you received a present from Göring and Goebbels in the first instance which had been made up of 250,000 Reichsmark from leading businessmen in Germany and 270,000 Reichsmark which came out of special accounts maintained by Göring and Goebbels. Then Hitler heard about that and ordered you to return that money because of the fact that some of it came from industry, and he himself gave you a so-called donation to the sum of 520,000 Reichsmark, isn’t that so?
FUNK: The first is not correct, but the latter is correct. But may I explain the details; they are of a completely different nature.
MR. DODD: Go ahead.
FUNK: On my fiftieth birthday the President and Directorate of the Reich Chamber of Economics, the chief organization of the entire German economy, called on me and declared that because of my more than 20 years of service to German economy they wanted, with the approval of the Führer, to make me a gift of an estate in Bavaria. That was a doubtful present, for later I had much worry and trouble because of it. A large house was built there because, as I was told, the Führer had said that he also wanted me to work there. The taxes were so high, however, that I could not pay them, nor the remaining construction costs, either. Thereupon I did not appeal to Göring, but Göring heard about it and had 300,000 Reichsmark given to me in order to help me out of my financial straits. I did not receive any money from Goebbels, but with the approval of Goebbels the film corporation joined the Chamber of Economics in giving me this money. When the Führer heard of the difficulties I had in paying taxes and making other payments he put a sum of 500,000 Reichsmark at my disposal. With the other money I received I made two donations, one of 500,000 Reichsmark to the Reichsbank for the families of the members of the Reichsbank killed during the war and another of 200,000 Reichsmark to the Reich Ministry of Economics for the families of members of that office who died in the war. I was able to live in, and pay for the upkeep of, this large house and grounds only because I had a relatively large income. However, from the beginning, when I saw the tremendous costs and expenses connected with it particularly in taxes, et cetera, I decided, in agreement with my wife, that after my death this estate should again be donated either to the Reichsbank or to my East Prussian homeland. I also discussed this several times with the Reichsbank Directorate.
MR. DODD: I am not much concerned with what you did with it, I only want to know if you got it. And you got it, didn’t you? You got 520,000 Reichsmark.
FUNK: Yes.
MR. DODD: You also made a present out of public funds on your own account to the Defendant Frick on one occasion, didn’t you? Didn’t you give Frick a birthday present of 250,000 Reichsmark on 12 March 1942?
FUNK: That I don’t know.
MR. DODD: You don’t remember? You don’t remember that? Do you know anything about the other gifts that were given to any of these other defendants out of public funds, either through your position as President of the Reichsbank or as an important functionary of the Nazi Party? Do you know anything about these other men and what they have got from the public treasury?
FUNK: These moneys were not given by me. They were given from the fund of the Führer by Lammers. I did not dispense such moneys.
MR. DODD: They were public funds, were they not? They did not come from anywhere else except the public? You don’t know then that Rosenberg got 250,000 Reichsmark? Did you know that?
FUNK: No.
MR. DODD: In January 1944; you were then President of the Reichsbank?
FUNK: Yes, but these moneys never came from the Reichsbank. These were moneys from funds which were administered by Lammers and I assume that the moneys came from the Adolf Hitler donation or from other funds. But the Reichsbank had nothing to do with these funds.
MR. DODD: Do you know that Von Neurath got 250,000 Reichsmark on 2 February 1943? Do you know anything about that? You were the President of the Reichsbank then.
FUNK: I know nothing about that.
MR. DODD: You heard about Lammers and his 600,000 Reichsmark. You know that Keitel got 250,000 Reichsmark on 22 September 1942. You never heard about that?
FUNK: The Reichsbank had nothing at all to do with these things.
MR. DODD: You know that Von Ribbentrop got 500,000 Reichsmark on 30 April 1943. You never heard of that? General Milch got 500,000 Reichsmark in 1941; none of these things ever came to your attention?
FUNK: I never had anything to do with these matters. They were Lammers’ concern and the money did not come from the Reichsbank.
MR. DODD: Now, I understood you to say that you were not the economic advisor in fact to Hitler or to the Nazi Party of the early days. That is in your own judgment you were not. It is a fact, however, that you were generally regarded as such by the public, by industrialists, by Party members and the high Party officials. Is that not so?
FUNK: I was called that, as I said here, on the basis of my activity in 1932. I acted as a mediator in conversations between the Führer and some leading economists and for a short while carried out the activity in the Party which has been described here.
MR. DODD: You have called yourself the economic advisor on occasion, have you not? At least on one occasion, during an interrogation, did you not refer to yourself as the economic advisor for the Party? You remember that?
FUNK: No.
MR. DODD: I think you will agree that you were generally recognized as such, but the really important thing is that the public thought you were.
FUNK: I have testified here that I was called that by the press and from the press this designation apparently went into record. I did not use this term myself.
MR. DODD: Were you the principal contact man between the Nazi Party and industry in the very early days?
FUNK: In 1932, and this is the only year which we need consider in connection with Party activities on my part, because I was not active in the Party before or after this year. I did arrange discussions between Hitler and leading men of industry, whom I can name. But other men also acted in that capacity; for example, State Secretary Keppler.
MR. DODD: I am not asking you about other men, I am asking you whether or not you were not a principal contact man. Actually you were encouraged by industry, were you not, to become active in the Party?
FUNK: Yes.
MR. DODD: You acted as a go-between for the Nazis and the big business in Germany.
FUNK: It did not take up much time, but I did it.
MR. DODD: Whether it took much of your time or not, that doesn’t interest us. It took a little bit of your time. That’s what you were doing?
FUNK: Yes.
MR. DODD: You remember Document Number EC-440 perhaps. It is really a statement that you made and prepared on the relationship of German industry to the Party in the National Socialist leadership of the State. You remember that paper you drew up on 28 June 1945? You may recall that you yourself said, “Keppler, who later became State Secretary, and who served as economic advisor to the Führer before me....” You used that terminology. You recall that?
FUNK: Keppler?
MR. DODD: Yes, he was the advisor before you. You remember that?
FUNK: Yes.
MR. DODD: Now, in the Propaganda Ministry, if I understand you correctly, you want the Tribunal to believe that you were something of an administrative functionary and not a very important man, and you did not really know what was going on. Is that your position?
FUNK: No. I had quite a large task, and that was the direction of an extensive cultural and economic concern. I stated that here. It consisted of film companies, theaters, orchestras, the German Trade Publicity Council, and the administration of the entire German radio, an undertaking worth a hundred millions, that is to say, a very extensive activity, an organizational, economic and financial activity. But propaganda was taken care of solely and exclusively by Goebbels.
MR. DODD: Yes. You knew the policies and the purposes of the Propaganda Ministry; there isn’t any doubt about that?
FUNK: Yes.
MR. DODD: You knew that, did you not?
FUNK: Yes.
MR. DODD: All right. Now, we can pass on to one other matter that I referred to earlier, to clear up another matter. Do you recall that the Defendant Schacht, when he was on the stand, said, I believe, at that now famous meeting where a number of industrialists were gathered to greet Hitler, that he did not take up the collection? Schacht said he did not do it. I think he said that Göring did it or somebody else. Do you remember that testimony about Schacht on the stand? You remember being interrogated about that subject yourself?
FUNK: Yes.
MR. DODD: Do you remember what you told us at the time?
FUNK: Yes.
MR. DODD: What did you tell us?
FUNK: I said that Schacht after addresses by Göring and Hitler made a brief speech, and that he asked those present to, so to say, go to the cashier and subscribe, that is, raise money for the election fund. He took over the collection and said that the coal industry...
MR. DODD: Who?
FUNK: He said...
MR. DODD: Who was the one who took up the collection? I don’t understand whom you mean by “he.”
FUNK: Schacht.
MR. DODD: That’s all I wanted to know about that. When did you first learn that the uprisings of November 1938 were not spontaneous?
FUNK: On the morning of 9 November, on my way from my home to the Ministry, I saw for the first time what had taken place during the night. Before that I had not had the slightest hint that such excesses and terror measures had been planned.
MR. DODD: I think you misunderstood me. I did not ask you when you first came to know about the uprisings; I asked you when you first learned that they were not spontaneous; when you first learned that they were instigated and planned by somebody else.
FUNK: I only found out about that later.
MR. DODD: Well, how much later?
FUNK: I believe very much later. Later on there was much discussion about this matter and it was never clear just who had been the instigator of these measures of terror and violence and where the order had originated. We knew that it had come from Munich. We had learned that in the meantime on 9 November; but, whether it was Goebbels or Himmler, and to what extent the Führer himself participated in this measure, I was never able to find out clearly. From my telephone conversation with Goebbels, which I mentioned today, one thing was clear: The Führer must have known about this matter, for he told me that the Führer had decreed, and Göring also said this, that the Jews were completely to be eliminated from economic life. From this I had to conclude that the Führer himself knew about this matter.
MR. DODD: Now from that telephone conversation we can also see one other thing. You knew that Goebbels had started this business, did you not, and that was the day after it happened? You knew it was not spontaneous and that is why you called up Goebbels and got after him; is that not so?
FUNK: Yes.
MR. DODD: How many days later did you make that inflammatory speech about what should be done to the Jews? About six days afterwards, did you not? I am referring to the one that was published in the Frankfurter Zeitung; your counsel referred to it this morning.
FUNK: Yes, to begin with...
MR. DODD: And in that speech you tried to make it appear to the public that that was a spontaneous uprising, did you not?
FUNK: Yes.
MR. DODD: That was not true, was it?
FUNK: I did not know that at the time. At that time I still believed that it was really something favored by large elements of the population. Very much later I found out that routine machinery had been put in motion.
MR. DODD: Are you telling this Tribunal now that on the morning of your telephone call to Goebbels, when you in effect blamed him for these uprisings, you were not well aware then that he had started it? Is that your position?
FUNK: At that time I did not know who had started this regime of terror and how it had been carried through; that was entirely new to me.
MR. DODD: If you did not know who started it, you knew that somebody started it and that it was not spontaneous?
FUNK: Yes.
MR. DODD: And still in your speech of 15 November you tried to make it appear to the public that it was just an uprising on the part of the German people, did you not?
FUNK: I based that on the attempted assassination of—I do not know who he was; some attaché in Paris—and actually the attempt caused much agitation. There is no doubt of it.
MR. DODD: Now I think you understand my question, Witness. You said on that occasion, you used these words: “The fact that the last violent explosion of the indignation of the German people because of a criminal Jewish attack against the German people took place,” and so on, and you went on. You were trying to make it appear there that this was a spontaneous reaction of the German people, and I insist that you knew better and had known it for some days, had you not?
FUNK: But I did not know that that is what took place. I admit that I knew that an impulse had come from some office or other.
MR. DODD: Well, all right. When did you coin the expression “crystal week”? Do you know what that expression is; where it came from?
FUNK: “Crystal week?”
MR. DODD: Yes.
FUNK: Yes, I did use these words once in connection with this action.
MR. DODD: You coined the phrase.
FUNK: Because much was shattered.
MR. DODD: You are the fellow who started that expression. You are the man, are you not? that was your expression?
FUNK: Yes, I used it.
MR. DODD: And you were using it—because you made this Frankfurter Zeitung speech?
FUNK: I once characterized that action with that term, it is true, because much had been shattered.
MR. DODD: Now, let us move on a little bit to the well-known meeting of 12 November, when Göring and Goebbels and all of the other people made their remarks about the Jews and you said you were present. You did not make any objection that day to anything that was said, did you?
FUNK: No. I merely attempted to have certain things put through in order to save something for the Jews, for example, their securities and stocks. Then I managed to have the stores reopened, so that things would move less rapidly, and I did more, too.
MR. DODD: I understand that, but I thought this morning you were really pretty sensitive about the terrible things that had happened to the Jews, and you remember some of the suggestions that were made that day by Göring and Goebbels; they were pretty nasty things, were they not?
FUNK: Yes, I openly admitted that I was much shaken...
MR. DODD: Were you? Well...
FUNK: And that my conscience bothered me.
MR. DODD: All right. You went on after that and made your Frankfurter Zeitung speech and you carried out these decrees, even though your conscience was bothering you; is that so?
FUNK: But the decrees had to be issued. I have already emphasized that several times here. I had no pangs of conscience because the decrees were issued. I had pangs of conscience because of the reasons for them. But the decrees themselves—
MR. DODD: That is what I’m asking you about.
FUNK: But the decrees had to be issued. The reasons for them—yes; I admit that.
MR. DODD: You know Schacht said on the stand that if he had been the Minister of Economy he did not think those things would have happened? Do you remember him saying that here the other day, do you?
FUNK: Yes. He must have had very powerful and influential connections in the Party, otherwise he could not have been successful.
MR. DODD: You did not have these connections in the Party, did you? You were not in the Party, you were a Minister?
FUNK: No, I did not have these connections and I could not prevent these terror actions.
MR. DODD: Well, we will see about that. Your counsel has submitted on your behalf an affidavit from one Oeser, O-e-s-e-r; do you remember that man? O-e-s-e-r, do you remember him?
FUNK: Yes.
MR. DODD: Do you remember him?
FUNK: Yes.
MR. DODD: And his affidavit—interrogatory, I believe it was...
THE PRESIDENT: Mr. Dodd, we will adjourn for a bare 10 minutes.
[A recess was taken.]
MR. DODD: Witness, I was inquiring about this man Oeser when we recessed—O-e-s-e-r; do you recall him? He was one of your employees in the Frankfurter Zeitung, was he not?
FUNK: Yes, he was the chief of the Berlin administration office of the Frankfurter Zeitung, a respected journalist.
MR. DODD: Yes. You know, do you not, that you have an interrogatory or an affidavit from him, which you are submitting to this court; it is in your document book?
FUNK: He volunteered to do that.
MR. DODD: Well, I’m not asking you—that is all right—whether he did or not; I just wanted to establish that you know that he did.
FUNK: Yes.
MR. DODD: Now, in that affidavit, as I read it, Oeser maintains that you were really being quite decent about the Jews in that newspaper. Is that not so? Is that not the sense of it; that you saved them from dismissal and so on, you put them under the exceptions provided in the decrees?
FUNK: Yes.
MR. DODD: All right.
FUNK: I allowed quite a number of editors to come under these exceptions.
MR. DODD: Yes, I know. Now I want to ask you this: There was a real reason, other than decency towards Jews, for your conduct with reference to that particular paper, was there not?
FUNK: No.
MR. DODD: Well, now, wait a minute.
FUNK: I do not know these people personally.
MR. DODD: I do not say that you knew the people personally. I say that there was a reason, other than your feeling for Jews as people, but which you have not told the Tribunal about yet, another reason maybe.
FUNK: In the case of the editors of the Frankfurter Zeitung?
MR. DODD: Yes.
FUNK: No.
MR. DODD: Now, is it not a fact that you and probably Hitler, and certainly Goebbels, and some of the other higher-ups of the Nazi Party, decided that that paper should be left in status quo because of its vast influence abroad? Is that not true?
FUNK: We did not talk about that at that time. That issue came up later. It came when the Führer demanded that almost all leading daily newspapers should either be taken over by the Party or merged with Party papers. And on that occasion I succeeded in having exception made for the Frankfurter Zeitung, and the Frankfurter Zeitung continued to exist for a long time. But that was much later. Here, in fact, the only reason was to help a few Jewish editors.
MR. DODD: Well...
FUNK: It was a purely humane reason.
MR. DODD: You can answer this. I just wanted to get your answer on the record because I’ll have more to say about it later. Do I understand you to deny that it was your established policy to preserve the status quo of the Frankfurter Zeitung because of its influence abroad?
FUNK: No, it was always my opinion that the Frankfurter Zeitung should remain as it was.
MR. DODD: Well, was it for the reason that I suggest, because these people were well known in the financial world abroad, and you did not want to impair the usefulness of that paper abroad? That’s what I’m getting at, and I say that that is why you kept them on, and not because you felt badly about their plight as Jews.
FUNK: No, not in this case. In this case that was not the reason.
MR. DODD: Very well; now, with respect to your activities as the Plenipotentiary for Economy and their relationship to the wars waged against Poland and the other powers, I have some questions that I would like to ask you. Now I will tell you what it is about first, so you will be aware. You are not maintaining, are you, that your position as Plenipotentiary for Economy did not have much to do with the affairs of the Wehrmacht?
FUNK: Yes, I assert that. With the Wehrmacht...
MR. DODD: Now, I have in my hand here a letter which Von Blomberg wrote to Göring. Do you remember that letter? It is a new document and you have not seen it in this Trial, but do you remember any such letter?
FUNK: No.
MR. DODD: Well, I ask you to be handed Document Number EC-255.
[The document was handed to the defendant.] Mr. President, this becomes Exhibit USA-839.
[Turning to the defendant.] Now, in this letter from Von Blomberg, I am only concerned now with the last sentence, really. You will notice that Von Blomberg, in this letter, refers to the fact that Schacht had been appointed, but the last sentence says, or in the next to the last paragraph he first urges that you be appointed immediately, and that is underlined in his letter; and in the last paragraph he says:
“The urgency of unified further work on all preparations for the conduct of the war does not admit of this office being paralyzed until 15 January 1938.”
This letter, by the way, was written on 29 November 1937. Certainly Von Blomberg thought that the job that he was suggesting you for would have some very great effect upon the conduct of the war, did he not?
FUNK: That may be, but in the first place, I do not know about that letter and, secondly, I was not immediately appointed Plenipotentiary for Economy but only in the course of 1938. Quite some time after I had been appointed Minister for Economics I asked Lammers why my appointment as Plenipotentiary for Economy had taken so long; he replied that my relationship to the Delegate for the Four Year Plan had to be cleared up first. That was the reason why several months passed before I became Plenipotentiary for Economy, because it had to be ascertained that Göring had the decisive authority for war economy...
MR. DODD: You really do not need to go into all that.
FUNK: I do not know about that letter, and I have never spoken to Von Blomberg about the affair.
MR. DODD: All right. You do recall perhaps that the OKW, after you were appointed, made some objection about the amount of authority that you had. Do you remember that?
FUNK: No.
MR. DODD: Now, I am holding here another new document, Number EC-270, which I will ask that you be shown, which will become Exhibit USA-840. While you are waiting for it, I will tell you that it is a letter written on 27 April 1938. You will notice that in the first paragraph of this letter from the OKW it says that the interpretation which has been put on the decree of the Führer—the decree of 4 February 1938—does not correspond to the necessities of total warfare.
And then you go down to the third paragraph on that first page and you will find other objections with respect to your authority. Apparently at this time the OKW thought you had too much to do with what would be the war effort, and finally on the last page, Mr. Witness, if you will look at this paragraph, you will see this sentence—on the last page of the English, anyway; near the end of the letter this sentence appears:
“The war economy, which is subordinated to the Plenipotentiary, represents the economic rear area of the armaments industry.”
And I want you to observe carefully those words “armaments industry.”
And then it goes on to say:
“If this stage fails, the striking power of the Armed Forces becomes questionable.”
I ask that you pay attention to the words “armaments industry,” because I recall that this morning you said you had absolutely nothing to do with the armaments industry; but apparently the OKW thought that you did, on 27 April 1938. Is that not so?
FUNK: I do not know this letter either. I do not know the attitude of the OKW but I do know this: The OKW, especially the Codefendant Field Marshal Keitel, was of the opinion at that time that I, as Plenipotentiary General for War Economy, should assume the authority and competence of Schacht; but there was a conversation between the Reich Marshal and Field Marshal Keitel—Keitel confirmed this to me—in which the Reich Marshal clearly declared; “The war economy will not be turned over to Funk.” I can honestly and sincerely say that I did not have the slightest idea of all these things. I did not know what kind of position the OKW intended me to have. I never had that function because the administration for the armaments industry was never included in the Ministry of Economics. I do not remember the matter.
MR. DODD: All right. That is your answer. I suppose at the time you were also aware, as you told the Tribunal, that you were really subordinate to Göring and in a very inferior position about all of these things. Is that so?
FUNK: Yes.
MR. DODD: I am going to ask you to look at another Document, Number EC-271, which will become Exhibit USA-841, and this document consists of a letter which you wrote to Lammers, a letter which Lammers wrote to the Chief of the High Command, Field Marshal Keitel, and one or two other letters not pertinent for the purposes of this present inquiry. It was written on 31 March 1938, and I want you to turn to the second page because that is where your letter appears. The first page is just a letter of transmittal from Lammers to Keitel, but let us look at the second page. Have you got it?
FUNK: Yes.
MR. DODD: You are writing to Lammers and you say—I am not going to read the whole letter, but the second paragraph. You wrote to Lammers and you say among other things:
“On the occasion of a trip to Austria I have, among other matters, also talked to Field Marshal Göring about the position of the Plenipotentiary for War Economy. I pointed out in this conversation that, contrary to the attitude of the OKW, of which I was informed, the decree of 4 February 1938 concerning the leadership of the Wehrmacht did not change the position of the Plenipotentiary for War Economy.”
And you go on—aside from the fact that the decree applied exclusively to the command of the Armed Forces, and so on, and that especially the last paragraph of that decree stated that you were dependent upon instructions of the Führer—to say:
“Moreover, among the instructions of the Führer is included the decision of the Reich Government of 21 May 1935, according to which the Plenipotentiary for War Economy, in his sphere of duty as supreme Reich authority, is immediately subordinated to the Führer.
“General Field Marshal Göring assured me that my interpretation, as mentioned above, was correct in every respect and also corresponds with the Führer’s opinion. Thereupon I asked him to give me a brief written confirmation. Field Marshal Göring promised to grant this request.”
Now, you wrote that letter to Lammers, did you not, on 31 March 1938, “yes” or “no?”
FUNK: Certainly.
MR. DODD: All right. You were trying to have supreme authority and make yourself answerable only to the Führer and that is what this contest was about, and that is what Document Number EC-271 referred to and this is your answer to the OKW’s objection that you had too much power. This does not look like you were a little man, does it, Mr. Witness?
FUNK: Yes. I wanted to clarify the position, but later it was not clarified in that sense but in the sense that I was dependent upon the directives of the Reich Marshal. I wrote this letter in order to try to obtain a clarification, but I do not remember this letter in detail.
MR. DODD: You told Lammers...
THE PRESIDENT: Mr. Dodd, is not this letter that you have just read the very letter which is referred to in the letter which you put to him immediately before?
MR. DODD: Yes, Sir, it is. It referred to EC-271. I am sorry, I said 271, I meant 270.
THE PRESIDENT: GB Number 649/38 is the letter you just read. Will you look at the first paragraph of EC-270; the letter referred to there, criticizing, is the Defendant Funk’s letter you just read.
MR. DODD: Yes, it is, your Honor.
[Turning to the witness.] My point here, Mr. Witness, is that, you see, you told the Tribunal that you really just worked for Göring; that you did not have much to say about these things, but now we find that you were writing a letter asserting your supreme authority and saying now, “it is a fact that I am really only answerable to Hitler,” and, you see, those two are quite inconsistent. What have you got to say about that?
FUNK: Yes; in fact, I was never successful.
MR. DODD: Now, let us see if you were not. Now you turn another page in that document and you will find another letter from Lammers, written on 6 April 1938, and it is written to you, and he tells you that you are just right in what you understood to be your position; that you are indeed only subordinate to the Führer and that he has sent a copy of your letter to both Field Marshal Göring and the Commander of the OKW. Now, what do you say about that?
FUNK: I see from this that I tried at that time to achieve that post, but in fact I never succeeded because the Reich Marshal himself stated later that he would never turn over the war economy to me. The formal authority of the Plenipotentiary for Economy was turned over to the Four Year Plan by a decree of the Führer of December 1939.
MR. DODD: Well, is that your answer? Now, you also have told the Tribunal, as I understood you at least, that you really did not have much to do with the planning of any aggressive wars, and that your activities were restricted to regulating and controlling the home economy, so to speak. Now, actually on 28 January 1939, which was some months before the invasion of Poland, you were considering the use of prisoners of war, were you not?
FUNK: That I do not know.
MR. DODD: Are you sure about that? Now I will ask that you be shown another document, Number EC-488 which becomes Exhibit USA-842. This is an unsigned letter, a captured document from your files. This letter, by the way, was transmitted under the signature of Sarnow. You know who he was; he was your deputy. Now, this letter, dated 28 January 1939, says that its subject is “Re: Employment of Prisoners of War.” Then it goes on to say:
“Under the Reich Defense Law of 4 September 1938* I have the direction for the economic preparations for the Reich defense, except the armament industry.”
Then it goes on, “For the utilization of labor...” and so on. But what I want to call your attention to particularly is the sentence in the second paragraph which says:
“The deficit in manpower may force me to the employment of prisoners of war as far as possible and practical. The preparations, therefore, have to be made in close co-operation with the OKW and GBW. The offices under my jurisdiction will duly participate therein.”
Remember that communication?
FUNK: No, I have never seen that letter, and never signed it. But that letter belongs to the matters about which I spoke this morning. The office of the Plenipotentiary for Economy—moreover, I see “Plenipotentiary for War Economy” is scratched out—was continuously occupied with these things. I personally had nothing to do with it.
MR. DODD: Well now, that is rather playing with words. This was your Ministry that was making these suggestions, and your principal deputy who transmitted this letter, is that not so?
FUNK: No, that was...
MR. DODD: Now, you look up in the right hand corner of that letter and see if it doesn’t say “The Plenipotentiary for the Economy,” and then it gives the address and date.
FUNK: Yes, and it is signed “By Order: Sarnow.”
MR. DODD: That is right, and he was your principal deputy, was he not?
FUNK: No.
MR. DODD: What was he?
FUNK: He only worked in the office of the Plenipotentiary General. My main deputy, who was in charge of those things, was Dr. Posse.
MR. DODD: Well now, at any rate...
FUNK: As I have said before, I personally had nothing to do with these things whatsoever.
MR. DODD: It has just been called to my attention that if you say the man was Posse, then in the second paragraph of that letter you can find his name: “I can refer to the statements of Generaloberst Keitel, State Secretary Dr. Posse...” At any event, important people in your organization were involved in this thing, were they not?
FUNK: Certainly.
MR. DODD: All right. Now, you remember the Document Number 3562-PS. It was introduced here as Exhibit USA-662. It is the minutes of a meeting set out by Dr. Posse, your deputy, which discussed a memorandum for financing the war, and you talked about that this morning and you said that despite the fact that there is a note on it “to be shown to the Minister,” you never saw it.
FUNK: I would have had to initial it if I had seen it.
MR. DODD: Well, whether that is so or not, I am not concerned about right now. Instead, I want you to listen while I read an excerpt from it. If you would like to see the document you can have it, but I hardly think it is necessary. You recall that in that document one of your memoranda is referred to, is it not? Do you remember? Do you remember that Posse said:
“It was pointed out that the Plenipotentiary for Economy is primarily concerned with introducing into the legislation for war finance the idea of financing war expenditures by anticipating future revenues, to be expected after the war.”
FUNK: Yes.
MR. DODD: All right. That is all I have to ask about that document. We can move right along here.
Referring again to your own direct testimony, I understood you to tell the Tribunal that insofar as the war against Poland was concerned, you did not really know until some time in August that there was even a likelihood of war with Poland; some time in August you thought it would be settled by diplomatic means. Is that not so?
FUNK: In all probability not. For months there was a latent danger of war, but even in August one could see that it was imminent.
MR. DODD: Had you been planning or making economic plans for war with Poland for more than a year before the attack on Poland? You can answer that “yes” or “no.”
FUNK: I do not know.
MR. DODD: You mean you did not know whether you had or not? What do you mean by that kind of an answer? Do you not remember?
FUNK: I do not remember.
MR. DODD: All right. Then I can help you. There is a Document, Number 3324-PS, which is already in evidence. You must remember it; it is Exhibit USA-661. That is a speech that you made. Is that not so? Do you not remember saying in it that you had been planning in secret for well over a year for the war on Poland? Do you remember that? Would you like to see the document?
FUNK: Yes, please.
MR. DODD: The sentence is here:
“Although all the economic and financial departments were utilized in the tasks and work of the Four Year Plan, under the leadership of Field Marshal Göring, the war economic preparation of Germany on another branch has also been advanced in secret for years...”
Do you remember that?
FUNK: Yes, now I know.
MR. DODD: You will notice it says here “for well over a year,” and you went on to say this had been done under you. Is that true?
FUNK: Yes, that was the activity of the Plenipotentiary for civilian economy. I already explained that this morning.
MR. DODD: All right. Well, that is all right. I just wanted to get your answer...
FUNK: I did not speak of Poland.
MR. DODD: Well, that is the only war that was on when you made this speech. It was October 1939.
FUNK: The preparations were not made for a specific war, it was...
MR. DODD: All right.
FUNK: It was a general preparation.
MR. DODD: Now, actually you and Göring were even in a contest for power to some extent, were you not? Was the Göring door one of those that you were also trying to get in? You can answer that very simply. You told us you were trying to get in these various doors, but you would get up there and never get in. I now ask you if the Göring door was one of those.
FUNK: I do not believe that I was so presumptuous as to want to get Göring’s post. That was far from being my intention. I had very little ambition at all.
MR. DODD: I did not say that you wanted to get his post, but you wanted to get some of his authority, did you not? Or do you not remember? Maybe that is the solution.
FUNK: No.
MR. DODD: Well, your man Posse was interrogated here by representatives of the Prosecution and the document is Number 3894-PS. He was asked these questions:
“Question: ‘What was the nature of the conflict between the Plenipotentiary for Economy and the Four Year Plan?’
“Answer: ‘The struggle for power.’
“Question: ‘The struggle for power between Funk and Göring?’
“Answer: ‘The struggle for power between Funk and Göring, between Funk and the Ministry for Agriculture and the Ministry of Communications.’
“Question: ‘How was the struggle finally resolved?’
“Answer: ‘Never. It was a struggle always continuing under the surface.’”
Then we move on:
“Question: ‘Did Funk, who had very important powers as Minister of Economics and later as Reichsbank President and as Chief Plenipotentiary for Economy, actually exercise these powers?’
“Answer: ‘Yes. But the powers of Göring were stronger.’
“Question: ‘Nevertheless, Funk did exercise important powers?’
“Answer: ‘Yes, as President of the Reichsbank, Minister of Economics, and Plenipotentiary for Economy.’”
Posse was your chief deputy, was he not?
FUNK: Yes, but Posse’s position was somewhat apart. My deputy was Landfried, and in the Reichsbank, Puhl. They knew these things better than Herr Posse.
MR. DODD: Well, all right.
FUNK: They should know more about it than Posse.
MR. DODD: You do not think he really knew what he was talking about when he said you were in the struggle for power? Is that your answer?
FUNK: No.
MR. DODD: [Turning to the Tribunal.] That becomes Exhibit USA-843. We have not offered it up to now.
Now, Mr. Witness, I want to ask you about when you first heard of the impending attack on Russia. I understood you to tell the Tribunal that you heard about it some time—I think you said—in May. Is that right? Or June?
FUNK: When Rosenberg was appointed.
MR. DODD: Well, that is what we want to know. When Rosenberg, in April of 1941, was appointed, you knew then there was to be an attack on Russia, did you not? But this morning I do not think you made that clear. Is that not right, Dr. Funk?
FUNK: Yes, I said that the reason given us for that appointment was that the Führer considered a war with Russia to be possible.
MR. DODD: Yes, but you know what you told the Tribunal this morning. You said that Lammers sent you notice of Rosenberg’s appointment because of your interest in improving the trade relations with Russia. That is the answer you made this morning. Now, that was not so, was it?
FUNK: Yes, Lammers has said that here, too.
MR. DODD: I do not care what Lammers said. I am asking you now if it is not a fact that you were told by Lammers because you were to co-operate with Rosenberg in making ready for the occupation of those territories after the attack began. Now you can answer that very simply. Is that not true?
FUNK: No.
MR. DODD: Now, we will see. You know, on another occasion you have given another answer, by the way, I might say, parenthetically. Do you remember telling the interrogator that you first heard from Hess about the impending attack on Russia? Do you remember you gave that answer at one time as the source of your first knowledge? Do you remember telling us that?
FUNK: No.
MR. DODD: I’ll tell you about that in a minute. We will stay now on this Rosenberg business.
There is a Document Number 1031-PS and it is dated 28 May 1941, which would be a little more than a month after the Rosenberg appointment: “Top secret notes; meeting with Reich Minister Funk.” Do you know what you were talking about that day, about counterfeiting money for use in Russia and the Ukraine and the Caucasus? Do you remember it?
FUNK: No.
MR. DODD: You do not remember it? Well, you had better take a look at the Document. It is Number 1031-PS, which becomes Exhibit USA-844. Do you not remember the day that your Reichsbank Director Wilhelm said it should not appear that you were counterfeiting so-called ruble bills for use in the occupied countries? Rosenberg was at that meeting. It is a very short memorandum. Have you read it? Oh, it is on Page 4, I think, of the document that you have; I am sorry. Do you find it? It starts out: “In the Ukraine and the Caucasus, however, it would become necessary to maintain the present currency, the ruble...” and so on. You were talking about money problems in the territory that you expected to occupy, and that was, well, about a month before the attack and about a month after Rosenberg’s appointment, was it not? Can you not give me an answer?
FUNK: I have not found the passage yet. Yes, if these countries were conquered, it was necessary to deal with these questions.
MR. DODD: The point is that certainly by that time you knew about the impending attack on the countries that had to be conquered, did you not?
FUNK: I knew nothing of an attack. I only knew of an imminent danger of war.
MR. DODD: Well, all right, you have it your way. The important thing is that you were talking about using money in the Ukraine and in the Caucasus, and it happened about a month later.
FUNK: Yes.
MR. DODD: All right. There are quite a few questions I want to ask. I would like to close this examination before the adjournment time is due. Do you have anything you want to say to that? I only offered to show you that you had knowledge about the impending attack. You knew that something was going to happen in the East. That is all I wanted to ask. I think you will agree with that, will you not?
FUNK: Yes.
MR. DODD: All right.
FUNK: Since the appointment of Rosenberg—and I explained that quite clearly this morning—I knew that a war with Russia was threatening.
MR. DODD: We are all in agreement. We do not need to go further. I understood you to say this morning that you did not know. That is all right. I misunderstood you then. I now understand you to say that you did know it.
FUNK: I said quite clearly this morning that I was informed that the Führer was expecting a war with Russia, but I am not sure about this document, as to who has written it.
MR. DODD: Well, I do not know either. I can simply tell you that it was captured, among other documents, from Rosenberg’s files. I cannot tell you anything more about it. I think we can talk about something else, if you will permit me. I really do not think there is any need to go on with it.
FUNK: Yes, but it is important insofar as these things about the ruble have been attributed to me.
MR. DODD: I will say it is, too.
FUNK: It says here that I said that the use of the Reichskreditkassenscheine and the determining of the rate of exchange involved considerable danger. In other words, I was very doubtful in regard to the proposals made in this respect.
MR. DODD: All right. I am glad to have your observations about it. Now, I want to talk to you a little bit about when you took over the Reichsbank. Posse was your principal deputy in your Ministry of Economics, was he not?
FUNK: Landfried was my main deputy.
MR. DODD: And by the way, he was at the same meeting that we have just been talking about. Who was your principal assistant in the Reichsbank?
FUNK: Puhl.
MR. DODD: He was a holdover from the Schacht days, was he not?
FUNK: Yes.
MR. DODD: Did you induce him to remain? Did you ask him to remain?
FUNK: No.
MR. DODD: You said that you selected your personnel. That is what you told the Tribunal this morning.
FUNK: No. Puhl remained and also Kretschmann and Wilhelm.
MR. DODD: I am not interested in going through your roster of personnel. I am only asking—and I will tell you the purpose. Puhl was a reliable banking man, was he not? He was well known in the international banking circles. He had been offered a position in the Chase Bank in New York at one time, did you know that?
FUNK: No, I did not know that.
MR. DODD: Well, it is true. In any event, he was quite a man, and he is a reliable man, is he not?
FUNK: Yes.
MR. DODD: You asked for him as a witness, did you not?
FUNK: Yes.
MR. DODD: And you wanted him to come here because you believe him and you know he...
FUNK: Yes.
MR. DODD: Now, I want to talk a little bit about the gold in the Reichsbank. How much gold did you have on hand at the end of the year 1941, roughly? Do not give me a long story about it, because I am not too much interested. I am merely trying to find out if you were short on gold in 1941.
FUNK: The gold reserve which I took over amounted to about 500 million Reichsmark when I received the post of Schacht.
MR. DODD: Well, all right.
FUNK: It was increased in any substantial manner only by the Belgian gold, as far as I know.
MR. DODD: That is really—it is interesting to hear all about it, but I have another purpose in mind. From whence did you obtain gold after you took over? Where did you get any new gold reserves from?
FUNK: Only by changing foreign currency into gold, and then, after I took over the post, we got in addition the gold reserve of the Czech National Bank. But we mainly increased our reserve through the Belgian gold.
MR. DODD: All right. Now, of course, gold became very important to you as a matter of payment in foreign exchange. You had to pay off in gold along in 1942 and 1943, did you not? Is that so?
FUNK: It was very difficult to pay in gold.
MR. DODD: I know it was.
FUNK: Because the countries with which we still had business relations introduced gold embargoes. Sweden refused to accept gold at all. Only in Switzerland could we still do business through changing gold into foreign currency.
MR. DODD: I think you have established that you had to use gold as foreign exchange in 1942 and 1943 and that is all I wanted to know. When did you start to do business with the SS, Mr. Funk?
FUNK: Business with the SS? I have never done that.
MR. DODD: Yes, sir, business with the SS. Are you sure about that? I want you to take this very seriously. It is about the end of your examination, and it is very important to you. I ask you again, when did you start to do business with the SS?
FUNK: I never started business with the SS. I can only repeat what I said in the preliminary interrogation. Puhl one day informed me that a deposit had been received from the SS. First I assumed that it was a regular deposit, that is, a deposit which remained locked and which was of no further concern to us, but then Puhl told me later that these deposits of the SS should be used by the Reichsbank. I assumed they consisted of gold coins and foreign currency, but principally gold coins, which every German citizen had had to turn in as it was, and which were taken from inmates of concentration camps and turned over to the Reichsbank. Valuables which had been taken from the inmates of concentration camps did not go to the Reichsbank but, as we have several times heard here, to the Reich Minister of Finance, that is...
MR. DODD: Just a minute. Were you in the habit of having gold teeth deposited in the Reichsbank?
FUNK: No.
MR. DODD: But you did have it from the SS, did you not?
FUNK: I do not know.
MR. DODD: You do not know?
Well, now, if Your Honor please, we have a very brief film, and I think we can show it before we adjourn, and I would like to show it to the witness before I examine him further on this gold business in the Reichsbank. It is a picture that was taken by the Allied Forces when they entered the Reichsbank, and it will show gold teeth and bridges and so on in their vaults.
FUNK: I know nothing about it.
MR. DODD: I think perhaps before I show the film I would like—I think I can do it in the time; I do want to complete this this afternoon—to read you an affidavit from this man Puhl who, you told me a few minutes ago, was a credible, well-informed man and whom you called as a witness. This affidavit is dated 3 May 1946.
DR. SAUTER: Mr. President, I protest against the reading of this affidavit by Herr Puhl. This affidavit most probably—I’m not sure—was taken here in Nuremberg. We do not know its contents. The Prosecution surprises us today with an affidavit of which we know nothing, and within ten minutes a dozen documents are thrown at us, of which the Prosecution asserts they are only short documents, whereas, for instance, one affidavit among them contains twelve pages, I believe. It is quite impossible for us, in the course of the extreme speed at which this examination is taking place, to follow these statements and these documents. Therefore I have to protest against the use of an affidavit of that kind at this moment.
MR. DODD: Well, this affidavit was taken at Baden-Baden, Germany, on the 3rd day of May. We have been trying for a long time to put this part of this case together, and we have finally succeeded. Certainly we did not turn it over to Dr. Sauter, because we wanted to use it for just the purposes that I am trying to put it to now. And it is an affidavit of his assistant Puhl, whom he called as a witness and from whom he expects to have an interrogatory. It has to do with a very important part in this case. I might say that if we are permitted to use it, certainly Dr. Sauter will have a chance to re-examine on it and he will have all night to study it if he would like to look it over.
THE PRESIDENT: Mr. Dodd, are you wanting to cross-examine the witness about this document?
MR. DODD: Yes, I want to read it to him and I want to ask him a couple of questions about it. I want him to know it because it is the basis for two or three questions of cross-examination, and to impeach him for statements he has already made about the gold.
THE PRESIDENT: You may do that. But Dr. Sauter, of course, will be able, if he wishes to do so, to apply afterwards that the witness should be produced for cross-examination. And he will have time in which he can consider the affidavit and make any comments that he wants to about it.
MR. DODD: Very well, Your Honor.
DR. SAUTER: Mr. President, may I make just one statement? Today a case occurred where the Prosecution protested against the fact that a document was used of which the Prosecution had not previously received an English translation. The representative of the Prosecution told me he did not understand German, and therefore the document had to be translated. I am of the opinion that the Defense should get the same right as the Prosecution.
If one English document after the other is thrown at me without my having the slightest idea of the contents, then I cannot answer them. Difficulties are constantly increasing. For instance, I have received documents here which contain 12 pages. One sentence is read out of such a document. The defendant is not given time to read even one single further paragraph. I myself am not given time. And in spite of that it is expected that the defendant immediately explains one single sentence taken out of the context, without having the possibility of examining the document. That, in my opinion, is asking too much.
THE PRESIDENT: Dr. Sauter, you had a translation in German of nearly every document, if not every document. And you have also been given every opportunity to consider documents when they have been translated into German. And that opportunity will be given to you hereafter and if there are any documents which are being used in cross-examination now which are not in German, they will be translated into German, and you will have them then. But once the witness is under cross-examination, the documents may be used. If you want to re-examine upon the documents after you have them in German, you will be able to do so.
DR. SAUTER: Mr. President, we Defense Counsel also desire to further the proceedings and not to delay them. But it does not help me at all if, in a week or two, when I shall finally have been able to examine the documents thrown today on the table, I must turn to you, Mr. President, with the request to be permitted to question the witness again. We are glad once we are through with the examination of the witnesses. But we simply cannot follow Mr. Dodd’s method. I cannot follow, and the defendant cannot either. One cannot expect the defendant to explain an isolated sentence taken out of the context, if he had no chance to examine the document as a whole.
THE PRESIDENT: Mr. Dodd.
MR. DODD: May I proceed to examine on the document?
THE PRESIDENT: Mr. Dodd, have you got any objection to Dr. Sauter’s seeing the document?
MR. DODD: Yes, indeed I have. I think it would be a new rule. Ever since this Defense opened, we have presented and confronted documents for the purpose of impeaching the credibility of various witnesses, and used these documents, and it goes to the very foundation of cross-examination. If we have to turn such documents over to the Defense before we cross-examine, the whole purpose of cross-examination is gone.
THE PRESIDENT: Mr. Dodd, if you are putting the document in and putting it to the witness as a document, then his counsel is entitled, I should have thought, to have it at the same moment.
MR. DODD: We are perfectly willing to give him a German copy right now. It is here for him, if he wants to have it, and we were ready with it when we came in the courtroom.
THE PRESIDENT: In German?
MR. DODD: Yes, Mr. President.
THE PRESIDENT: I think the best thing will be for us to adjourn now, and then you will hand to Dr. Sauter when you use the document a translation of it in German.
MR. DODD: Yes; tomorrow morning, when we use it.
THE PRESIDENT: When you use it.
MR. DODD: Very well, Sir.
[The Tribunal adjourned until 7 May 1946 at 1000 hours.]
ONE HUNDRED AND TWENTY-THIRD DAY Tuesday, 7 May 1946
Morning Session
[The Defendant Funk resumed the stand.]
MR. DODD: Witness, you had a conference with Dr. Sauter last night after we recessed Court, did you not, for about an hour?
FUNK: Yes.
MR. DODD: Now we were talking yesterday, when the Tribunal rose, about the gold deposits in the Reichsbank, and I had asked you when you started to do business with the SS, and as I recall, you said you did not do any business with the SS. And then we went along a little further and you did say that the SS did deposit some materials, some property belonging to people in concentration camps. Do I properly understand your testimony to have been, in substance, as I have stated it?
FUNK: No. I said that Herr Puhl—I do not remember in what year—told me one day that a gold deposit had arrived from the SS and he also told me—and he said it somewhat ironically—it would be better that we should not try to ascertain what this deposit was. As I said yesterday, it was impossible in any case to ascertain what was deposited. When something was deposited, the Reichsbank had no right to look into it to see of what it consisted. Only later, when Herr Puhl made another report to me, did I realize that when he used the word “deposit” it was a wrong term; it was not a deposit but it was a delivery of gold. There is of course a great difference. I personally assumed that it concerned a gold deposit, that this gold consisted of gold coins or other foreign currency or small bars of gold or something similar, which had been brought in from the inmates of the concentration camps—everybody in Germany had to hand these things over—and that it was being handed to the Reichsbank, which would use it. Since you mentioned this matter, I remember another fact of which I was not conscious until now. I was asked about it during my interrogation, and during this interrogation I could not say “yes” to it because at that time I did not remember it. I was asked during my interrogation whether I had the agreement of the Reichsführer that the gold which was delivered to the Reichsbank should be utilized by the Reichsbank. I said I did not remember. However, if Herr Puhl makes such a statement under oath, I will not and cannot dispute it. It is evident that if gold were delivered which should come to the Reichsbank, then the Reichsbank had the right to utilize such gold. I certainly never spoke more than twice or at most three times to Herr Puhl about this matter. What these deposits or these deliveries consisted of and what was done with these deliveries, how they were utilized, I do not know. Herr Puhl never informed me about that either.
MR. DODD: Well now, let us see. You were not ordinarily in the habit, in the Reichsbank, of accepting jewels, monocles, spectacles, watches, cigarette cases, pearls, diamonds, gold dentures, were you? You ordinarily accepted that sort of material for deposit in your bank?
FUNK: No; there could be no question, in my opinion, that the bank had no right to do that, because these things were supposed to be delivered to an entirely different place. If I am correctly informed about the legal position, these things were supposed to be delivered to the Reich Office for Precious Metals and not to the Reichsbank. Diamonds, jewels, and precious stones were not the concern of the Reichsbank because it was not a place of sale for these things. And in my opinion, if the Reichsbank did that, then it was unlawful.
MR. DODD: That is exactly right.
FUNK: If that happened, then the Reichsbank committed an illegal act. The Reichsbank was not authorized to do that.
MR. DODD: And is it your statement that if it was done you did not know anything about it?
FUNK: No.
MR. DODD: You did not know?
FUNK: No.
MR. DODD: You were frequently in the vaults of the Reichsbank, were you not? As a matter of fact you liked to take visitors through there. I say, you were frequently in the vaults of the bank yourself?
FUNK: Yes, I was, where the gold bars were kept.
MR. DODD: I will come to the gold bars in a minute. I just want to establish that you were in the vaults frequently, and your answer, as I understand it, is “yes” that you were?
FUNK: It was the usual thing if someone came to visit us, particularly foreign visitors, to show them the rooms where the gold was kept and we always showed them the gold bars and there was always the usual joke as to whether one could lift a gold bar or not. But I never saw anything else there except gold bars.
MR. DODD: How heavy were these gold bars that you had in the vaults?
FUNK: They were the usual gold bars which were used in commerce between banks. I think they varied in weight. I think the gold bars weighed about 20 kilograms. Of course, you can figure it out. If one...
MR. DODD: That is all right. That is satisfactory. When you were in the vaults you never saw any of these materials that I mentioned a few minutes ago—jewels, cigarette cases, watches, and all that business?
FUNK: Never. I was in the vaults at the most four or five times and then only to show this very interesting spectacle to visitors.
MR. DODD: Only four or five times from 1941 to 1945?
FUNK: I assume so. It was not more often. I only went down there with visitors, particularly foreign visitors.
MR. DODD: Are you telling the Tribunal that as head of the Reichsbank you never made an inspection, so to speak, of the vaults, never took a look at the collateral? Did you not ever make an inspection before you made your certifications as to what was on hand? Certainly every responsible banker does that regularly, does he not? What is your answer?
FUNK: No, never. The business of the Reichsbank was not conducted by the President. It was conducted by the Directorate. I never bothered about individual transactions, not even gold transactions, or even about slight variations in the individual gold reserves, et cetera. If large deliveries of gold were expected, the Directorate reported to me. The Directorate conducted the business, and I believe the detailed transactions were probably known only to the director responsible for that particular department.
MR. DODD: Now, did you ever do any business with pawnshops?
FUNK: With what?
MR. DODD: Pawnshops. Do you not know what a pawnshop is? There must be a German word for that.
FUNK: Pfandleihe.
MR. DODD: Whatever it is, you know what they are, do you not?
FUNK: Where you pawn something.
MR. DODD: Yes.
FUNK: No, I never did any...
MR. DODD: All right, we will get to that a little later too. Right now, since you do not seem to recall that you ever had any or saw any such materials as I have described in your vaults, I ask that we have an opportunity to show you a film which was taken of some materials in your vaults when the Allied Forces arrived there.
[Turning to the President.] I would ask, Mr. President, that the defendant be permitted to come down, where he can watch the film, so that his memory will be properly refreshed.
THE PRESIDENT: Yes, you may have him brought down.
[Moving pictures were then shown.]
THE PRESIDENT: Mr. Dodd, at some stage, I take it, you will offer evidence as to where that film was made.
MR. DODD: Yes, I will. There will be an affidavit as to the circumstances under which the film was made, who was present, and why; but, for the information of the Tribunal, it was taken in Frankfurt when the Allied Forces captured that city and went into the Reichsbank vaults.
[Turning to the defendant.] Now, Witness, having seen these pictures of materials that were found in your Reichsbank vaults a year ago, or a little earlier than a year ago, you now recall that you did have such material on hand over a period of 4 or 5 years, 3 or 4 years, 3 years—I think actually a little longer than 3 years?
FUNK: I have never seen anything of this sort. I also have the impression that a large part of these things which were shown in the film came from deposits, because people, thousands of them, had locked deposits which they delivered to the Reichsbank, in which they put their jewels and other valuables, as we have just seen. Probably some were hidden valuables, which they should have given up, such as foreign money, foreign exchange, gold coins, et cetera. As far as I know we had thousands of closed deposits into which the Reichsbank could not look. I never saw a single item such as these shown in the film, and I cannot imagine where these things came from, to whom they belonged, and to what use they were put.
MR. DODD: Well, that is an interesting answer. I asked you yesterday, and I ask you again now, did you ever hear of anybody depositing his gold dentures in a bank for safekeeping? [There was no response.]
You saw that film, and you saw the gold bridgework, or mouth-plates, did you not, and the other dental work? Certainly nobody ever deposited that with a bank. Is that not a fact?
FUNK: As far as the teeth are concerned, this is a special case. Where these teeth came from I do not know. It was not reported to me, nor do I know what was done with those teeth. I am convinced that items of this sort, when they were delivered to the Reichsbank, had to be turned over to the Office for Precious Metals, for the Reichsbank was not a place where gold was worked. Neither do I know whether the Reichsbank even had the technical facilities to work this metal. I do not know about that.
MR. DODD: And not only did people not deposit gold teeth, but they never deposited eyeglass rims, did they, such as you saw in the picture?
FUNK: That is right. These things are, of course, no regular deposits. That goes without saying.
MR. DODD: And you saw there were some objects that obviously were in the process of being melted down. Practically the last scene in that film showed something that looked as if it had been in the process of being melted, did it not? You saw it?
Well, will you answer me, please, “yes” or “no”? Did you see it?
FUNK: I cannot say that exactly. I do not know whether they were melting it down. I have no knowledge of these technical matters. To be sure, now I see quite clearly what was not known to me until now, that the Reichsbank did the technical work of melting down gold articles.
MR. DODD: Well, now, let us see what your assistant, Mr. Puhl, says about that, the man who you told us yesterday was a credible gentleman, and whom you asked the Tribunal to call as a witness on your behalf. I am holding in my hand an affidavit executed by him on the 3rd day of May 1946 at Baden-Baden, Germany.
“Emil Puhl, being duly sworn, deposes and says:
“1. My name is Emil Puhl. I was born on 28 August 1889 in Berlin, Germany. I was appointed a member of the Board of Directors of the Reichsbank in 1935 and Vice President of the Reichsbank in 1939, and served in these positions continuously until the surrender of Germany.
“2. In the summer of 1942 Walter Funk, President of the Reichsbank and Reich Minister of Economics, had a conversation with me and later with Mr. Friedrich Wilhelm, who was a member of the Board of Directors of the Reichsbank. Funk told me that he had arranged with Reichsführer Himmler to have the Reichsbank receive in safe custody gold and jewels for the SS. Funk directed that I should work out the arrangements with Pohl, who, as head of the economic section of the SS, administered the economic side of the concentration camps.
“3. I asked Funk what the source was of the gold, jewels, bank notes, and other articles to be delivered by the SS. Funk replied that it was confiscated property from the Eastern Occupied Territories, and that I should ask no further questions. I protested against the Reichsbank handling this material. Funk stated that we were to go ahead with the arrangements for handling the material, and that we were to keep the matter absolutely secret.
“4. I then made the necessary arrangements with one of the responsible officials in charge of the cash and safes departments for receiving the material, and reported the matter to the Board of Directors of the Reichsbank at its next meeting. On the same day Pohl, of the economic section of the SS, telephoned me and asked if I had been advised of the matter. I said I would not discuss it by telephone. He then came to see me and reported that the SS had some jewelry for delivery to the Reichsbank for safekeeping. I arranged with him for delivery and from then on deliveries were made from time to time, from August 1942 throughout the following years.
“5. The material deposited by the SS included jewelry, watches, eyeglass frames, dental gold, and other gold articles in great abundance, taken by the SS from Jews, concentration camp victims, and other persons. This was brought to our knowledge by SS personnel who attempted to convert this material into cash and who were helped in this by the Reichsbank personnel with Funk’s approval and knowledge. In addition to jewels and gold and other such items, the SS also delivered bank notes, foreign currency, and securities to the Reichsbank to be handled by the usual legal procedure established for such items. As far as the jewelry and gold were concerned, Funk told me that Himmler and Von Krosigk, the Reich Minister of Finance, had reached an agreement according to which the gold and similar articles were on deposit for the account of the State and that the proceeds resulting from the sale thereof would be credited to the Reich Treasury.
“6. From time to time, in the course of my duties, I visited the vaults of the Reichsbank and observed what was in storage. Funk also visited the vaults from time to time.
“7. The Golddiskontobank, at the direction of Funk, also established a revolving fund which finally reached 10 to 12 million Reichsmark for the use of the economic section of the SS to finance production of materials by concentration camp labor in factories run by the SS.
“I am conversant with the English language and declare that the statements made herein are true to the best of my knowledge and belief.”
Document Number 3944-PS; it is signed by Emil Puhl and duly witnessed.
Mr. President, I would like to offer this affidavit as Exhibit USA-846 and the film as Exhibit USA-845.
[Turning to the defendant.] Now, Witness, having heard this affidavit from your close associate and your brother director of the Board of Directors of the Reichsbank, and the man who, you admitted yesterday was a credible and truthful man, what do you now say to this Tribunal about your knowledge of what was going on between your bank and the SS?
FUNK: I declare that this affidavit by Herr Puhl is not true. I spoke to Herr Puhl about the entire matter of these gold deposits, as I have repeatedly stated, three times at most, but I believe it was only twice. I never exchanged a word with Herr Puhl regarding precious stones and jewelry. It is incredible to me that a man who most certainly also carried out certain functions in his agreements with the SS—that is, with Herr Pohl—now tries to put the blame on me. On no account will I take this responsibility and I request that Herr Puhl be called here, and that in my presence he may declare in all detail when, where, and how he has spoken to me about these different items, and to what extent I told him what to do.
I repeat my statement that I knew nothing about jewelry and other deliveries from concentration camps, and that I have never spoken to Herr Puhl about these things. I can only say again what I said at the beginning, that Herr Puhl once told me that a gold deposit had arrived from the SS. I remember it now, it had escaped me as I did not pay too much attention to the entire matter. I remember that, urged by him, I spoke to the Reichsführer about whether the Reichsbank could utilize these items. The Reichsführer said, “Yes.” But at no time did I speak to the Reichsführer about jewelry and precious stones and watches and such things. I spoke only of gold.
Concerning what Puhl states about a financing scheme—I believe that goes back a number of years—I know Herr Puhl came to me one day and said that he was asked to give a credit for certain factories of the SS and somebody was negotiating with him about the matter. I asked him, “Is this credit secure? Do we get interest?” He said, “Yes, up till now they have had a credit from the Dresdner Bank and it must now be repaid.” I said, “Very well, do that.” After that I never heard anything more about this matter. It is news to me that this credit was so large, that it was made by the Golddiskontobank. I do not remember it, but it is entirely possible. However, I never heard any more about this credit, which Herr Puhl had given to certain factories. He always spoke about factories, about businesses; it was a bank credit which had previously been given by a private bank. I remember I asked him once, “Has this credit been repaid?” That was some considerable time later. He said, “No, it has not been repaid yet.” That is all I know about these matters.
MR. DODD: All right. Now, what do you know about this—one part of the affidavit you have not covered—what do you know about the last part that says you established a revolving fund for the SS for the building of factories near the concentration camps? Do you remember that? I read it to you. Puhl says, “The Reichsbank, at the direction of Funk, established a revolving fund which finally reached 10 to 12 million Reichsmark for the use of the economic section of the SS to finance production of materials by concentration camp labor in factories run by the SS.” Do you admit that you did that?
FUNK: Yes, that is what I just mentioned; that Herr Puhl told me one day, I believe in 1939 or 1940, that some gentlemen from the economic section of the SS had spoken to him regarding a credit, which until that time had been granted by the Dresdner Bank and which they would now like to have from the Reichsbank. I asked Herr Puhl, “Will we get interest; is the credit secure?” He said, “Yes.” So I said, “Give them this credit,” and later on I said just what I mentioned above. That is all I know about the matter. I know nothing more.
MR. DODD: Now, you also got a fee for handling these materials that you saw in the film, did you not, from the SS? The bank was paid for carrying on its part of this program?
FUNK: I did not understand that.
MR. DODD: I say, is it not a fact that you received payment from the SS over this period of more than 3 years for handling these materials which they turned over to you?
FUNK: I do not know about that.
MR. DODD: Well, you would know, would you not, as President of the bank, if you did receive payment? How could you help knowing?
FUNK: These were probably such small payments that no one ever reported them to me. I do not know anything about any payment from the SS.
MR. DODD: What would you say if I tell you that Herr Puhl said that the bank did receive payment during these years, and that there were altogether some 77 shipments of materials such as you saw here this morning? Do you say that is untrue, or do you agree with it?
FUNK: That might be quite true, but I was never informed about these things. I know nothing about it.
MR. DODD: Is it conceivable that you, as President of the Reichsbank, could not know about 77 such shipments and about a transaction that you were being paid to handle? Do you think that is a likely story?
FUNK: If the Board of Directors did not report to me about these things, I cannot have known about them, and I declare again quite definitely that I was not informed about these details. On one occasion I was told about a gold deposit of the SS which was brought to us. Later on it transpired that it was a delivery from the SS. And then I knew about this credit transaction. That is all I know about these matters.
MR. DODD: Now, let me tell you something that may help you a little bit. As a matter of fact, your bank sent memoranda to people concerning this material from time to time, and I think you know about it, do you not? You made up memoranda stating what you had on hand and whom you were transferring it to. Are you familiar with any such memoranda?
FUNK: No.
MR. DODD: Well, then you had better take a look at Document Number 3948-PS, Exhibit USA-847, and see if it refreshes your memory. That is 3948-PS.
[The document was handed to the defendant.]
Now, this document is a memorandum apparently addressed to the Municipal Pawn Brokerage in Berlin, and it is dated 15 September 1942. Now, I am not going to read all of it, although it is a very interesting document, but as you can see, the memorandum says, “We submit to you the following valuables with the request for the best possible utilization.” Then you list 247 platinum and silver rings, 154 gold watches, 207 earrings, 1,601 gold earrings, 13 brooches with stones—I am just skipping through; I am not reading all of them—324 silver wrist watches, 12 silver candle sticks, goblets, spoons, forks, and knives, and then, if you follow down here quite a way, diverse pieces of jewelry and watch casings, 187 pearls, four stones said to be diamonds. And that is signed “Deutsche Reichsbank, Hauptkasse” and the signature is illegible. Perhaps, if you look at the original, you might tell us who signed it.
FUNK: No, I do not know who signed it.
MR. DODD: You have the original?
FUNK: I do not know.
MR. DODD: Well, look at the signature there and see if you recognize it as the signature of one of your workers.
FUNK: It says—somebody from our cashier’s office signed it. I do not know the signature.
MR. DODD: Somebody from your bank, was it not?
FUNK: Yes, from the cashier’s department. I do not know the signature.
MR. DODD: Do you want this Tribunal to believe that employees and people in your bank were sending lists out to municipal pawn brokers without it ever coming to your attention?
FUNK: I know nothing at all about these events. They can only be explained in that things were apparently delivered to the Reichsbank which it was not supposed to keep. That is obvious.
MR. DODD: Well, I would also like you to look at Document Number 3949-PS, which is dated 4 days later, 19 September 1942, Exhibit USA-848. Now, you will see this is a memorandum concerning the conversion of notes, gold, silver, and jewelry in favor of the Reich Minister of Finance, and it also says that it is “a partial statement of valuables received by our precious metals department.” Again I think it is unnecessary to read it all. You can look at it and read it, but the last two paragraphs, after telling what the shipments contained as they arrived on 26 August 1942, say:
“Before we remit the total proceeds, to date 1,184,345.59 Reichsmark to the Reichshauptkasse for the account of the Reich Minister of Finance, we beg to be informed under what reference number this amount and subsequent proceeds should be transferred.
“It might further be of advantage to call the attention of the responsible office of the Reich Minister of Finance in good time to the amounts to be transferred from the Deutsche Reichsbank.”
And again that is signed, “Deutsche Reichsbank, Hauptkasse,” and there is a stamp on there that says, “Paid by check, Berlin, 27 October 1942, Hauptkasse.”
FUNK: For this document, that is, this note to the Reich Minister of Finance, I believe I am able to give an explanation, and that is on the basis of testimony given here by witnesses who came from concentration camps. The witness Ohlendorf, if I remember correctly, and another one, have testified that the valuables which had been taken from the inmates of concentration camps had to be turned over and were delivered to the Reich Minister of Finance. Now, I assume that the technical procedure was that these things were first brought to the Reichsbank by mistake. The Reichsbank, however—and I keep repeating it—could do nothing with the pearls, jewelry, and similar items which are mentioned here, and therefore turned over these items to the Reich Minister of Finance or they were used for the account of the Reich Minister of Finance. That is apparent from this document. In other words, this merely is a statement of account sent by the Reichsbank for the Reich Minister of Finance. That is, I believe, the meaning of this document.
MR. DODD: Well, indeed, you did hear Ohlendorf say that these unfortunate people who were exterminated in these camps had their possessions turned over to the Reich Minister of Finance. I believe he testified to that effect here. Now, you also...
FUNK: That is what I heard here. These things were news to me. However, I did not know that the Reichsbank...
MR. DODD: You have told us that twice already.
FUNK: ...that the Reichsbank dealt with these matters in such detail.
MR. DODD: Are you telling us that you did not know they dealt with them in such detail, or that you did not know they dealt with them at all? I think that is important. What is your answer, that you did not know they went into them in such detail or that you did not know anything about it?
FUNK: I personally had nothing to do with it at all.
MR. DODD: Did you know about it?
FUNK: No.
MR. DODD: You never heard of it?
FUNK: I did not know at all that any jewelry, watches, cigarette cases, and so forth were delivered to the Reichsbank; that is news to me.
MR. DODD: Did you know that anything came from concentration camps to the Reichsbank? Anything at all?
FUNK: Yes, the gold, of course. I already said that.
MR. DODD: Gold teeth?
FUNK: I have said that—no.
MR. DODD: What gold from the concentration camps?
FUNK: The gold about which Herr Puhl had reported to me, and I assumed that these were coins and other gold which had to be deposited at the Reichsbank anyway, and which the Reichsbank could utilize according to the legal regulations. Otherwise, I know nothing about it.
MR. DODD: Just what did Himmler say to you and what did you say to Himmler when you had this conversation, as you tell us, about this gold from the concentration camp victims? I think the Tribunal might be interested in that conversation. What did he say, and what did you say, and where was the conversation held?
FUNK: I do not remember any more where the conversation was held. I saw Himmler very rarely, perhaps once or twice. I assume that it was on the occasion of a visit in the field quarters of Lammers, where Himmler’s field quarters were also located. It must have been there. On that occasion we spoke very, very briefly about that.
MR. DODD: Wait just a minute. Will you also tell us when it was?
FUNK: Possibly during the year 1943; it might have been 1944, I do not remember.
MR. DODD: All right.
FUNK: I attached no importance whatsoever to this matter. In the course of the conversation I put the question, “There is a gold deposit from you, from the SS, which we have at the Reichsbank. The members of the board of directors have asked me whether the Reichsbank can utilize that.” And he said, “Yes.” I did not say a word about jewelry or things of that kind or gold teeth or anything of that sort. The entire conversation referred only very briefly to this thing.
MR. DODD: Do you mean to tell us that an arrangement was made with your bank independently of you and Himmler, but by somebody in the SS and somebody in your bank—that you were not the original person who arranged the matter?
FUNK: That is right. It was not I.
MR. DODD: Who in your bank made that arrangement?
FUNK: Possibly it was Herr Puhl or maybe somebody else from the Reichsbank Directorate who made the arrangement with one of the gentlemen of the economic section in the SS. And I was only informed of it by Herr Puhl very briefly.
MR. DODD: Did you know Herr Pohl, P-o-h-l, of the SS?
FUNK: I imagine it was he. Herr Pohl never spoke to me about it.
MR. DODD: You do not know the man?
FUNK: I must certainly have seen him at some time, but Herr Pohl never spoke to me about these matters. I never spoke to him.
MR. DODD: Where did you see him, in the bank?
FUNK: Yes, I saw him once in the bank when he spoke to Puhl and other gentlemen of the Reichsbank Directorate during a luncheon. I walked through the room and I saw him sitting there but I personally never spoke with Herr Pohl about these questions. This is all news to me, this entire matter.
MR. DODD: Well, do you recall the testimony of the witness Hoess in this courtroom not so long ago? You remember the man? He sat where you are sitting now. He said that he exterminated between 2½ and 3 million Jews and other people at Auschwitz. Now, before I ask you the next question I want you to recall that testimony and I will point something out for you about it that may help you. You recall that he said that Himmler sent for him in June 1941, and that Himmler told him that the final solution of the Jewish problem was at hand, and that he was to conduct these exterminations. Do you recall that he went back and looked over the facilities in one camp in Poland and found it was not big enough to kill the number of people involved and he had to construct gas chambers that would hold 2,000 people at a time, and so his extermination program could not have got under way until pretty late in 1941, and you observe that your assistant and credible friend Puhl says it was in 1942 that these shipments began to arrive from the SS?
FUNK: No, I know nothing about the date. I do not know when these things happened. I had nothing to do with them. It is all news to me that the Reichsbank was concerned with these things to this extent.
MR. DODD: Then I take it you want to stand on an absolute denial that at any time you had any knowledge of any kind about these transactions with the SS or their relationship to the victims of the concentration camps. After seeing this film, after hearing Puhl’s affidavit, you absolutely deny any knowledge at all?
FUNK: Only as far as I have mentioned it here.
MR. DODD: I understand that; there was some deposit of gold made once, but no more than that. That is your statement. Let me ask you something, Mr. Funk...
FUNK: Yes; that these things happened consistently is all news to me.
MR. DODD: All right. You know you did on one occasion at least, and possibly two, break down and weep when you were being interrogated, you recall, and you did say you were a guilty man; and you gave an explanation of that yesterday. You remember those tears. I am just asking you now; I am sure you do. I am just trying to establish the basis here for another question. You remember that happened?
FUNK: Yes.
MR. DODD: And you said, “I am a guilty man.” You told us yesterday it was because you were upset a little bit in the general situation. I am suggesting to you that is it not a fact that this matter that we have been talking about since yesterday has been on your conscience all the time and that was really what is on your mind, and it has been a shadow on you ever since you have been in custody? And is it not about time that you told the whole story?
FUNK: I cannot tell more to the Tribunal than I have already said, that is the truth. Let Herr Puhl be responsible before God for what he put in the affidavit; I am responsible for what I state here. It is absolutely clear that Herr Puhl is now trying to put the blame on me and to exculpate himself. If he has done these things for years with the SS, it is his guilt and his responsibility. I have only spoken to him two or three times about these things, that is, about the things I have mentioned here.
MR. DODD: You are trying to put the blame on Puhl, are you not?
FUNK: No. He is blaming me and I repudiate that.
MR. DODD: The trouble is, there was blood on this gold, was there not, and you knew this since 1942?
FUNK: I did not understand.
MR. DODD: Well, I would like to ask you one or two questions about two short documents. It will take but a short time. You told the Tribunal yesterday that you had nothing to do with any looting of these occupied countries. Do you know what the Roges corporation was?
FUNK: Yes. I do not know in detail what they did. I know only that it was an organization which made official purchases for various Reich departments.
MR. DODD: This Roges corporation purchased on the black market in France with the surpluses from the occupation cost fund, did it not?
FUNK: I was against this type of purchases in the black market.
MR. DODD: I am not asking you whether you were for it or against it. I was simply asking you if it is not a fact that they did it.
FUNK: I do not know.
MR. DODD: All right. You had better take a look at Document Number 2263-PS, which is written by one of your associates, Dr. Landfried, whom you also asked for as a witness here and from whom you have an interrogatory. This is a letter dated 6 June 1942, addressed to the Chief of the OKW Administrative Office:
“In answer to my letter of 25 April 1942”—and so on—“100 million Reichsmark were put at my disposal from the Occupation Cost Fund by the OKW. This amount has already been disposed of except for 10 million Reichsmark, since the demands of the Roges (Raw Material Trading Company), Berlin, for the acquisition of merchandise on the black market in France, were very heavy. In order not to permit a stoppage in the flow of purchases which are made in the interest of the prosecution of the war, further amounts from the occupation cost fund must be made available. According to information from Roges and from the economic department of the Military Commander in France, at least 30 million Reichsmark in French francs are needed every 10 days for such purchases.
“As, according to information received from Roges, an increase of purchases is to be expected, it will not be sufficient to make available the remaining 100 million Reichsmark in accordance with my letter of 25 April 1942, but over and above this, an additional amount of 100 million Reichsmark will be necessary.”
It is very clear from that letter written by your associate Landfried that the Roges corporation, which was set up by your Ministry, was engaged in black market operations in France with money extorted from the French through excessive occupation costs, is it not?
FUNK: That the Roges made such purchases is true. These things have already been dealt with here in connection with the orders and directives which the Four Year Plan gave for these purchases on the black market. However, these are purchases which were arranged and approved by the state organization. What we especially fought against were the purchases without limits in the black market. I already mentioned yesterday that I finally succeeded in getting a directive from the Reich Marshal that all purchases in the black market were to be stopped because through these purchases naturally merchandise was withdrawn from the legal markets.
MR. DODD: You told us that yesterday. That was 1943. There was not much left in France on the black market or white market or any other kind of market by that time, was there? That country was pretty well stripped by that time, as is shown in the letters.
FUNK: In 1943 I believe a great deal was still coming from France. There was continuous production going on in France and it was considerable. The official French statistics show that even in 1943 large quantities of the total production were being diverted to Germany. These quantities were not a great deal less than in 1941 and ’42.
MR. DODD: Well, in any event I also want you to talk a little bit about Russia, because I understood you to say yesterday you did not have much to do with that. Schlotterer was your man who was assigned to work with Rosenberg, was he not?
FUNK: From the beginning I assigned Ministerial Director Dr. Schlotterer to Rosenberg, so that only one economic department, the competent department for the Minister for the Eastern Occupied Territories, would work in Russia, and not two.
DR. DODD: That is all I want to know. He was assigned. And he participated in the program of stripping Russia of machines, materials, and goods, which went on for some considerable period of time; you knew about it.
FUNK: No, that is not true. This man did not have this task. These transactions were handled by the Economic Department East which, I think, came under the Four Year Plan. As far as I know these transactions were not handled by Minister Rosenberg and certainly not by the Ministry of Economics.
MR. DODD: It is a different story on different occasions. I think the best way is to read your interrogation. On 19 October 1945 you were interrogated here in Nuremberg. You were asked this question:
“And part of the plan was to take machines, materials and goods out of Russia and bring them into Germany, was it not?”
And you answered:
“Yes, most certainly, but I did not participate in that. But in any case it was done.”
The next question:
“Question: Yes, and you yourself participated in the discussions concerning these plans, and also your representative, Dr. Schlotterer?
“Answer: I myself did not participate.
“Question: But you gave the power to act for you in that connection to Dr. Schlotterer?
“Answer: Yes; Schlotterer represented me in economic questions in the Rosenberg Ministry.”
FUNK: No, that is not true. This testimony is completely confused, because Schlotterer joined the Rosenberg Ministry. He became head of the economic department there. Also, this testimony is not true to this extent, since we certainly sent more machines into Russia than we took out of Russia. When our troops came to Russia everything had been destroyed, and in order to put the economy there in order, we had to send large quantities of machinery and other goods to Russia.
MR. DODD: Do you mean to say that you did not make these answers that I have just read to you when you were interrogated?
FUNK: Those answers are not correct.
MR. DODD: You know, it is very interesting that you told us yesterday that the answers to the questions put to you by Major Gans were incorrect. I posed another interrogation to you yesterday and you said that was incorrect. Now a third man has interrogated you, and you say that one is incorrect.
FUNK: No, I say what I said is wrong.
MR. DODD: Well, of course, that is what I am talking about.
FUNK: That is wrong.
MR. DODD: I will submit that interrogation in evidence; it is not in form to be submitted, but I would like to submit it a little later, with the Tribunal’s permission.
THE PRESIDENT: You will inform us, when you do, as to the number and so on?
MR. DODD: Yes, I will. I have no further questions.
THE PRESIDENT: Do any of the other prosecutors wish to cross-examine?
STATE COUNSELLOR OF JUSTICE M. Y. RAGINSKY (Assistant Prosecutor for the U.S.S.R.): After Mr. Dodd’s cross-examination I have a few supplementary questions to ask.
Defendant Funk, you testified yesterday that your Ministry at the time of the attack on the Soviet Union had very limited functions, and that you yourself were not a minister in the true sense of the word. In this connection I want to ask you a few questions regarding the structure of the Ministry of Economics. Tell me, are you familiar with the book by Hans Quecke, entitled, The Reich Ministry of Economics? Do you know about this book?
FUNK: No.
MR. COUNSELLOR RAGINSKY: You do not know? Are you familiar with the name of Hans Quecke?
FUNK: Hans Quecke?
MR. COUNSELLOR RAGINSKY: Yes. Hans Quecke. He was a counsellor in the Ministry of Economics.
FUNK: Quecke was a ministerial director in the Ministry of Economics.
MR. COUNSELLOR RAGINSKY: And he, of course, knew about the structure of the Ministry of Economics and about its functions. Am I right?
FUNK: Certainly. He must have known about that.
MR. COUNSELLOR RAGINSKY: I present this book in evidence to the Tribunal as Exhibit USSR-451, and you, Witness, will receive a photostat copy of the section of this book in order that you can follow me. Please open it at Page 65, last paragraph. Have you found the passage in question?
FUNK: I have not found it yet. I can only see...
MR. COUNSELLOR RAGINSKY: Page 65, last paragraph of the page.
FUNK: Yes.
MR. COUNSELLOR RAGINSKY: You have found it, yes?
FUNK: The structure of the Reich Ministry of Economics?
MR. COUNSELLOR RAGINSKY: It gives the structure of the Ministry of Economics as on 1 July 1941. Your permanent deputy was a certain Dr. Landfried. Is that the same Landfried whose testimony was presented by the Defense Counsel?
FUNK: Yes.
MR. COUNSELLOR RAGINSKY: I must ask you to follow the text:
“Landfried had under him a special department which was in charge of fundamental questions of supply of raw materials for the military economy.”
Defendant Funk, I am asking you...
FUNK: Just a moment. Where is that?
MR. COUNSELLOR RAGINSKY: It is in Section 2, Part II. Have you found it?
FUNK: No, there is nothing here about war economy. I do not see anything about war economy. Auslands-Organisation...
MR. COUNSELLOR RAGINSKY: Part II, Subparagraph 2.
FUNK: It says nothing about war economy here.
MR. COUNSELLOR RAGINSKY: I shall read the entire paragraph into the record. We shall get down to the Auslands-Organisation in good time.
FUNK: This is a special section.
MR. COUNSELLOR RAGINSKY: Yes, a special section.
FUNK: Directly subordinate to the State Secretary here is Section S, Special Section, basic questions of the supply of raw materials, basic questions of war economy, basic questions of...
MR. COUNSELLOR RAGINSKY: It is precisely about this war economy that I wish to speak. He was also in charge of the fundamental market policy and of economic questions in the border territories. The ministry consisted of five main departments. Am I right?
FUNK: Yes.
MR. COUNSELLOR RAGINSKY: The third main department was headed by Schmeer? Am I right?
FUNK: Yes.
MR. COUNSELLOR RAGINSKY: You had a special department entitled, “Elimination of the Jews from Economic Life.” That was in 1941? Am I right?
FUNK: Yes; that was the time we dealt with these matters; in that department the regulations for carrying out these orders were dealt with. We discussed them at length yesterday.
MR. COUNSELLOR RAGINSKY: Defendant Funk, I ask you to follow the text: “The fourth main department was headed by Ministerialdirektor Dr. Klucki, and this department was in charge of banks, currency, credit and insurance matters.” Is that a fact?
FUNK: Yes.
MR. COUNSELLOR RAGINSKY: I presume that you must know the structure of your own ministry and we need not waste time in further discussions. You must know that the fifth main department was headed by State Secretary Von Jagwitz. This department was in charge of special economic problems in different countries. The fifth section of this department attended to questions of military economy connected with foreign economy. Am I right?
FUNK: Yes.
MR. COUNSELLOR RAGINSKY: The same department dealt with special foreign payments as well as with the blocked deposits...
FUNK: I do not understand. This is the Foreign Trade Department. They merely dealt with the technical carrying-out of the foreign exports.
MR. COUNSELLOR RAGINSKY: Take the section dealing with foreign currencies. Have you found the passage?
FUNK: Yes.
MR. COUNSELLOR RAGINSKY: You have found that it deals with blocked deposits. Were you at all connected with the collaboration existing between your ministry and the Office of Foreign Affairs of the NSDAP? Is my question clear to you?
FUNK: Yes.
MR. COUNSELLOR RAGINSKY: And your ministry had a special section dealing with these matters?
FUNK: Only this office. That can be explained in this manner. The Under State Secretary, Von Jagwitz, who was the head of this main department, was also active in the Auslands-Organisation. He had created a liaison office for himself in the ministry to deal with economic questions which came to the ministry—to this department, which was the Export Department, the Foreign Department—via the Auslands-Organisation. This concerned Von Jagwitz only, who at the same time was active in the Auslands-Organisation and maintained a liaison office.
MR. COUNSELLOR RAGINSKY: Then we are to understand that the Foreign Political Department had special economic functions abroad, and that it co-operated with your ministry in this sense? Is that correct?
FUNK: No, that is not correct.
MR. COUNSELLOR RAGINSKY: Then why did this department exist?
FUNK: It was not a department, but the Under State Secretary, Von Jagwitz, was at the same time active in the Auslands-Organisation. I do not know in what position. He was active in the Auslands-Organisation before he was taken into the ministry by the Reich Marshal. Then he himself created a kind of liaison office between his department and the Auslands-Organisation. That is, frequently economists from abroad belonging to the Auslands-Organisation of the NSDAP came to Berlin, and these people came to Under State Secretary Von Jagwitz and discussed their business with him and they reported to him about their experience and knowledge of foreign countries. I do not know any more about it.
MR. COUNSELLOR RAGINSKY: You wish to convince us that this was the personal initiative of Von Jagwitz, and that you as minister knew nothing at all about it?
FUNK: Certainly, I knew about it. He did it with my knowledge, with my knowledge and approval...
MR. COUNSELLOR RAGINSKY: Please follow the text and you had better listen to what I want to say. I read the last paragraph which states:
“To the Main Department V is attached the office of the Auslands-Organisation with the Reich Ministry of Economics. This office secures the co-operation between the ministry and the Auslands-Organisation of the Nazi Party.”
This means that no mention is made of any private initiative of Von Jagwitz, as you tried to persuade us, but this department really was a part of your ministry. Have you found the passage?
FUNK: Yes. Herr Von Jagwitz had this liaison office and essentially it was limited to his person. It was a liaison office for collaboration with the Auslands-Organisation, which was a perfectly natural procedure in many cases. I do not see why this should be unusual or criminal.
MR. COUNSELLOR RAGINSKY: We shall come back to the question at a later stage. Mr. President, I should like to pass over to another part. Would it be convenient to have a short recess now? I have a few more questions to ask.
THE PRESIDENT: Very well; the Tribunal will recess.
[A recess was taken.]
MR. COUNSELLOR RAGINSKY: You mentioned yesterday that you were the Plenipotentiary for Economy, but not a plenipotentiary in the full sense of the word. Schacht was the true plenipotentiary and you were merely a secondary one. Do you remember your article entitled “Economic and Financial Mobilization”? Do you remember what you wrote at that time?
FUNK: No.
MR. COUNSELLOR RAGINSKY: Well, we are not going to waste any time on that question. I shall remind you of it. I submit to the Tribunal in evidence Exhibit USSR-452 (Document Number USSR-452), an article by Funk, published in the monthly journal of the NSDAP and of the German Labor Front, entitled “Der Schulungsbrief,” in 1939.
[Turning to the defendant.] You wrote at that time:
“As the Plenipotentiary for Economy appointed by the Führer, I must see to it that during the war all the forces of the nation should be secured also from the economic point of view.”
Have you found this passage?
FUNK: Yes, I have found it.
MR. COUNSELLOR RAGINSKY: Further on you wrote:
“The contribution of economy to the great political aims of the Führer demands not only a strong and unified direction of all the economic and political measures, but also above all careful co-ordination.... Industry; food, agriculture, forestry, timber industry, foreign trade, transport, manpower, the regulation of wages and prices, finance, credits must be coordinated, so that the entire economic potential should serve in the defense of the Reich. In order to fulfill this task, the authorities of the Reich in charge of these spheres are included in my authority in my capacity as Plenipotentiary for Economy.”
Do you confirm that this is precisely what you wrote in 1939?
FUNK: Yes.
MR. COUNSELLOR RAGINSKY: Is that question not quite clear to you?
THE PRESIDENT: He said, “Yes.”
FUNK: I said, “Yes”; I certainly wrote that.
MR. COUNSELLOR RAGINSKY: You confirm it. You know about the issue in June 1941 of the so-called “Green File” of Göring? It was read into the record here. These are directives for the control of economy or, rather, directives for the spoliation of the occupied territories of the U.S.S.R. How did you personally participate in the planning of these directives?
FUNK: I do not know that. I do not know any more whether or not I participated at all.
MR. COUNSELLOR RAGINSKY: You do not remember? How is it possible that these documents were planned without you, Reich Minister of Economics, the President of the Reichsbank, and Plenipotentiary for Economy and the armament industry?
FUNK: First, at that time I was no longer Plenipotentiary for Economy. I was never plenipotentiary for the armament industry. The powers of the Plenipotentiary for Economy, shortly after the beginning of the war, were turned over to the Delegate for the Four Year Plan. That has been repeatedly confirmed and emphasized and what I did personally at that time concerning economy in the Occupied Eastern Territories can only have been very, very little. I do not remember it because the administration of economy in the Occupied Eastern Territories was in charge of the Economic Staff East and the Delegate of the Four Year Plan, and that office, of course, co-operated with the Rosenberg Ministry for the Occupied Eastern Territories. Personally I remember only that, as I mentioned yesterday, in the course of time the Ministry of Economics sent individual businessmen, merchants, from Hamburg and from Cologne, et cetera, to the East in order to secure private economic activities in the Eastern Occupied Territories.
MR. COUNSELLOR RAGINSKY: Yes, we have already heard what “activities” you dealt with. Your name for spoliation is “private economic activities.” Do you remember the Prague Conference of December 1941—the meeting of the economic organization—or must I remind you of it?
FUNK: No.
MR. COUNSELLOR RAGINSKY: Not necessary?
FUNK: During the interrogations my attention was called by General Alexandrov to this speech, and I told him at that time already that there was a wrong newspaper report about me which I had rectified later or after a short time.
MR. COUNSELLOR RAGINSKY: Just a minute, Defendant Funk. You are slightly anticipating events. You do not yet know what I am going to ask you. First listen to me and then reply. You have informed the Tribunal that you never attended any meeting of Hitler’s at which the political and economic aims of the attack on the Soviet Union were discussed, that you did not know of any purpose and of any declared plans of Hitler for the territorial dismemberment of the Soviet Union, and yet you yourself declared in your statement that “the East will be the future colony of Germany,” Germany’s colonial territory. Did you say that the East would be the future colonial territory of Germany?
FUNK: No; I denied that in my interrogation. I immediately said, after this was presented to me, that I was speaking of the old German colonial territories. General Alexandrov can confirm that. He questioned me at that time.
MR. COUNSELLOR RAGINSKY: I have no intention of calling General Alexandrov as a witness. I am only asking you if you did say so; was it written as stated?
FUNK: No.
MR. COUNSELLOR RAGINSKY: You stated that you did not have to be reminded, but that is precisely what was mentioned in your speech, and I am going to quote verbatim from this speech:
“The vast territories of the eastern European region, containing raw materials which have not yet been opened up to Europe, will become the promising colonial territory of Europe.”
And exactly what Europe were you discussing in December 1941 and what former German territories did you wish to mention to the Tribunal? I am asking you.
FUNK: I have not said that. I said that I did not speak about colonial territories, but of the old colonization areas of Germany.
MR. COUNSELLOR RAGINSKY: Yes, but we are not speaking here of old territories; we are speaking here of new territories which you wished to conquer.
FUNK: The area had been conquered already. We did not have to conquer that. That had been conquered by German troops.
MR. COUNSELLOR RAGINSKY: No. It was not known that they were conquered, since you were already retreating from them.
You said that you were the President of the Continental Oil Company. This company was organized for the exploitation of the oil fields of the Occupied Eastern Territories, especially in the districts of Grozny and Baku. Please answer me “yes” or “no.”
FUNK: Not only of the Occupied Territories—this company was concerned with oil industries all over Europe. It had its beginnings in the Romanian oil interests and whenever German troops occupied territories where there were oil deposits, that company, which was a part of the Four Year Plan, was given the task by the various economic offices, later by the armament industry, of producing oil in these territories and of restoring the destroyed oil-producing districts. The company had a tremendous reconstruction program. I personally was the president of the supervisory board and I mainly had to do the financing of that company only.
MR. COUNSELLOR RAGINSKY: That I have already heard. But you have not answered my question.
I asked you if this company had as object the exploitation of the Grozny and Baku oil wells. Did the oil wells of the Caucasus form the basic capital of the Continental Oil Company?
FUNK: No.
MR. COUNSELLOR RAGINSKY: No? I am satisfied with your reply.
FUNK: That is not right. We had not conquered the Caucasus and therefore the Continental Oil Company could not be active in the Caucasus.
MR. COUNSELLOR RAGINSKY: All right. But Rosenberg at that time had already made a report on the conquest and exploitation of the Caucasus. Do you remember that here, before the Tribunal, a transcript of the minutes of a meeting held at Göring’s office on 6 August 1942 with the Reich Commissioners of the Occupied Territories was read into the record? Do you remember that meeting?
FUNK: Yes.
MR. COUNSELLOR RAGINSKY: Did you participate in this meeting?
FUNK: That I do not know. Did they speak about the oil territories of the Caucasus in that meeting? That I do not know.
MR. COUNSELLOR RAGINSKY: No, I do not wish to say anything as yet. I shall ask you a question and you will answer. I ask you: Did you participate in that meeting?
FUNK: I cannot remember. It may very well be.
MR. COUNSELLOR RAGINSKY: You do not remember?
FUNK: No.
MR. COUNSELLOR RAGINSKY: In that case you will be shown a document. It has already been submitted to the Tribunal, and was here read into the record. It is Exhibit Number USSR-170; it has already been presented. As stated at that meeting, the most effective measures for the economic spoliation of the Occupied Territories of the U.S.S.R., Poland, Czechoslovakia, Yugoslavia, and other countries were discussed. At this meeting Defendant Göring addressed himself to you. Do you remember whether you were present at that meeting or not?
FUNK: Yes, indeed. I remember that. But what Göring told me then refers to the fact that, a long time after the Russian territories had been occupied, we sent businessmen there to bring into those territories any goods that might interest the population. For instance it says here: “Businessmen must be sent there.... We must send them to Venice to buy up these things in order to re-sell them in the occupied Russian territories.” That is what Göring told me on that occasion. At least, that is what can be read here.
MR. COUNSELLOR RAGINSKY: I did not ask you about that, Defendant Funk. Were you present at that meeting or not? Could you answer that question?
FUNK: Of course. Since Göring talked to me, I must have been there. It was on 7 August 1942.
MR. COUNSELLOR RAGINSKY: Defendant Funk, you have replied here to certain questions asked by Mr. Dodd regarding the increase of the gold reserve of the Reichsbank; I should like to ask you the following question: You have stated that the gold reserves of the Reichsbank were increased only by the gold reserves of the Belgian Bank; but did you not know that 23,000 kilograms of gold were stolen from the National Bank of Czechoslovakia and transferred to the Reichsbank?
FUNK: I did not know that it had been stolen.
MR. COUNSELLOR RAGINSKY: Then what do you know?
FUNK: I stated explicitly here yesterday that the gold deposits had been increased mostly by the taking over of the gold of the Czech National Bank and the Belgian Bank. I spoke especially of the Czech National Bank yesterday.
MR. COUNSELLOR RAGINSKY: Yes, but I am not asking you about the Belgian Bank, but about the Bank of Czechoslovakia.
FUNK: Yes, I mentioned it yesterday. I said so yesterday...
THE PRESIDENT: He said that just now. He said that he had spoken about the Czechoslovakian gold deposits.
MR. COUNSELLOR RAGINSKY: Mr. President, he did not mention Czechoslovakia yesterday and I am asking him this question today. But if he replies to this question in the affirmative, I shall not interrogate him any further on the matter, since he will have confirmed it.
[Turning to the defendant.] I now pass on to the next question, to the question of Yugoslavia. On 14 April 1941, that is, prior to the complete occupation of Yugoslavia, the Commander-in-Chief of the German Army issued a directive for the occupied Yugoslav territories. This is Exhibit USSR-140; it has already been submitted to the Tribunal. Subparagraph 9 of this directive determines the compulsory rate of Yugoslav exchange—20 Yugoslav dinars to the German mark. And the same compulsory rate of exchange, which had been applied to the Yugoslav dinar, was also applied to the Reich credit notes issued by the Reich Foreign Currency Institute.
These currency operations permitted the German invaders to export from Yugoslavia at a very cheap rate various merchandise as well as other valuables. Similar operations were carried out in all the Occupied Eastern Territories, and I ask you: Do you admit that such operations were one of the means for the economic spoliation of the Occupied Eastern Territories?
FUNK: No.
MR. COUNSELLOR RAGINSKY: Very well.
FUNK: That depends on the relation of the exchange rate. In some cases, in particular in the case of France, I protested against the underevaluation...
MR. COUNSELLOR RAGINSKY: Excuse me just one minute, Defendant Funk. You have already spoken about France and I do not want to take up the time of the Tribunal unnecessarily. I think you ought to answer my question.
FUNK: At the moment I do not know what the exchange rate between the dinar and the mark was at that time. In general, insofar as I had anything to do with it—I did not make the directive; that came from the Minister of Finance and from the Armed Forces—insofar as I had anything to do with it I always urged that the rate should not differ too greatly from the rate which existed and which was based on the purchasing power. At the moment I cannot say what the exchange rate for dinars was at that time. Of course, Reich credit notes had to be introduced with the troops because otherwise we would have had to issue special requisition vouchers, and that would have been much worse than introducing an official means of payment, as is now being done here in Germany by the Allies, because working with requisition vouchers is much more disadvantageous and harmful for the population and the entire country than working with a recognized means of payment. We invented the Reich credit notes ourselves.
MR. COUNSELLOR RAGINSKY: In other words, you wish to state that you had nothing to do with it and that the entire matter rested with the Ministry of Finance. Then tell me please, are you aware of the testimony given by your assistant, Landfried, whose affidavit was submitted by your defense counsel? You will remember that Landfried stated and affirmed something totally different. He said that in the determination of exchange rates in the occupied territories yours was the final and determining voice. Do you not agree with this statement?
FUNK: When these rates were determined, I, as President of the Reichsbank, was of course consulted and, as can be confirmed by every document, I always advocated that the new rates should be as close as possible to the old rates established on the basis of the purchasing power, that is to say, no underevaluation.
MR. COUNSELLOR RAGINSKY: Consequently, the compulsory rate of exchange in the occupied countries was introduced with your knowledge and according to your instructions?
FUNK: Not on the basis of my directives. I was only asked for advice.
MR. COUNSELLOR RAGINSKY: Your advice?
FUNK: I had to give my approval. That is, the Reichsbank Directorate formally gave the approval, but...
MR. COUNSELLOR RAGINSKY: I am satisfied with your reply. I now go on to the next question. On 29 May 1941 the Commander-in-Chief in Serbia issued an order regarding the Serbian National Bank, which order has already been submitted as Exhibit USSR-135. This order liquidated the National Bank of Yugoslavia and divided the entire property of the bank between Germany and her satellites. Instead of the National Bank of Yugoslavia a fictitious so-called Serbian Bank was created, whose directors were appointed by the German Plenipotentiary for National Economy in Serbia. Tell me, do you know who was the Plenipotentiary for National Economy in Serbia?
FUNK: It was probably the Consul General Franz Neuhausen, the representative of the Four Year Plan.
MR. COUNSELLOR RAGINSKY: Yes. It was Franz Neuhausen. Was he a collaborator in the Ministry of Economics?
FUNK: No.
MR. COUNSELLOR RAGINSKY: He never worked in the Ministry of Economics?
FUNK: No.
MR. COUNSELLOR RAGINSKY: He never worked there?
FUNK: Neuhausen? No, he never worked in the Ministry of Economics.
MR. COUNSELLOR RAGINSKY: Was he a collaborator of Göring’s?
FUNK: Yes, that is correct.
MR. COUNSELLOR RAGINSKY: Well, he was a collaborator of Göring’s. Do you admit that such specific currency operations, as a result of which the Yugoslavian Government and its citizens were robbed of several million dinars, could not have been carried out without your participation and without the co-operation of the departments within your jurisdiction?
FUNK: I do not know in detail the directives according to which the liquidation was carried out and by which the new Serbian National Bank was founded, but it goes without saying that the Reichsbank participated in such a transaction.
MR. COUNSELLOR RAGINSKY: I want to ask you two more questions. Together with the unconcealed spoliation, consisting in the confiscations and requisitions which the German invaders carried out in the Occupied Territories of Eastern Europe, they also exploited these countries to the limit of their economic resources by applying various exchange and economic measures, such as depreciation of currency, seizure of the banks, artificial decrease of prices and wages, thus continuing the economic spoliation of the occupied territories. Do you admit that this was precisely the policy of Germany in the Occupied Territories of Eastern Europe?
FUNK: No.
MR. COUNSELLOR RAGINSKY: You do not admit this?
FUNK: In no way whatsoever.
MR. COUNSELLOR RAGINSKY: I now submit to the Tribunal Document USSR-453. This is a new document, consisting of notes on a conference held by the Reich Commissioner for the determination of prices on 22 April 1943. Price experts from all the occupied territories attended this conference. I shall now read into the record some excerpts from this document. It says on Page 2:
“The 5½ million foreign workers are composed of: 1½ million prisoners of war, 4 million civilian workers.”
The document further says:
“1,200,000 from the East, 1,000,000 from the former Polish territories... 200,000 citizens of the Protectorate... 65,000 Croatians, 50,000 remainder of Yugoslavia (Serbia)”—and so on.
Further this document also says in connection with the equalization of prices:
“Price equalization should be operated to the debit of the producer countries, that is, through the Central Clearing Office, which for the most part is to the advantage of the occupied countries.”
On Page 14 it is stated:
“These price deliberations were of no importance for the occupied territories, since the main interest did not lie in the welfare of the population but in the utilization of all the economic forces of the country.”
On Page 16 we find the following, excerpt:
“Concerning the Occupied Eastern Territories, Ministerial Counselor Roemer has stated that prices there are far below German prices, and so far the Reich has already reaped large import profits.”
Mention is made, on Page 19, of Germany’s clearing debt, which amounted to 9,300,000 marks. At the same time the clearing balance for Czechoslovakia showed a deficit of 2,000,000; for the Ukraine of 82,500,000; for Serbia of 219,000,000; for Croatia of 85,000,000; and for Slovakia of 301,000,000 marks.
And finally, on Page 22 of the document, it says:
“The prices in the Occupied Eastern Territories are kept at the lowest possible level. We have already realized import profits which are being used to cover Reich debts. Wages are generally only one-fifth of what they are in Germany.”
You must admit that the planned robbery perpetrated by the German invaders on so gigantic a scale could never have been carried out without your active participation as Minister of Economics, President of the Reichsbank, and Plenipotentiary for Economy?
FUNK: I must again stress that during the war I was no longer Plenipotentiary for Economy. But may I state my position to this document? First, there is the figure of the number of the workers which were brought from the occupied territories and other foreign countries into Germany. I have emphasized, myself, and it has been confirmed by other statements, that I was basically against bringing in foreign manpower from occupied territories to such an extent as to impair the economic order in those territories. I am not even speaking about recruitment of forced labor. I also opposed that. When an expert whom I do not know says that the deliberations about price policy were of no importance for the occupied territories, because the main interest did not lie with the welfare of the population but in the exploitation of economic forces, I must contradict that point of view. In any case, it is not my point of view. I do not know who the man was who said that, but it is a matter of course that a territory cannot produce well unless the economy is kept on a good footing and prices are fixed at a level which enables the people to exist and to maintain social order. So I have to oppose this point of view also. As far as the clearing debt is concerned, I explained yesterday in detail that the clearing system was in common usage for Germany, and that I have always recognized and confirmed that these clearing debts were genuine debts which, after the war, had to be repaid in the currency in which they were incurred, based on the purchasing power at that time. I do not see any spoliation here.
Moreover, I must again stress the fact that I was not competent for the economy in the occupied territories, that I had no power to give a directive there and that I participated only insofar as I detailed officials to individual offices, just as all other departments did, and that, of course, there was co-operation between these offices and the department at home. But I cannot assume responsibility for the economy in the occupied territories. The Reich Marshal definitely admitted that as far as economic questions are concerned, it was his responsibility.
MR. COUNSELLOR RAGINSKY: I understand. You collaborated, and now you do not wish to bear the responsibility. You say that the expert has made the statement. But do you remember your testimony which you gave on 22 October 1945?
FUNK: I do not know what interrogation...
MR. COUNSELLOR RAGINSKY: When you were asked about the compulsory mobilization of foreign workers you were also asked if you knew about it and if you had ever protested against it. Is that correct? You replied, “No, why should I be the one to protest against it?”
FUNK: That is not correct. I protested against the compulsory recruitment of workers and against so many workers having been taken out of occupied territory that the local economy could no longer produce. That is not correct.
MR. COUNSELLOR RAGINSKY: I have one last question to ask you. Do you remember an article published in the newspaper Das Reich, dated 18 August 1940, in connection with your 50th birthday? This article is entitled, “Walter Funk, Pioneer of National Socialist Economic Thought.” I shall read into the record a few excerpts from this article:
“From 1931 on, Walter Funk, as personal economic adviser and Plenipotentiary of the Führer for Economics, and therefore the untiring middleman between the Party and German economy, was the man who paved the way to the new spiritual outlook of the German industrialists.
“If in the outbreak of 1933 the differences which had existed for more than a decade in the public life of Germany between politics and economy, and especially between politics and the industrialists, disappeared overnight, if from the outset, the guiding rule of all labor has been an ever-increasing contribution towards a common end, this is due to the pioneering work of Funk, who since 1939 has directed his speeches and his writings to that end.”
And in the last paragraph of this article:
“Walter Funk remained true to himself because he was, and is, and will remain a National Socialist, a fighter who dedicates all his work to the idealistic aims of the Führer.”
The whole world knows what the ideals of the Führer were.
Do you admit that this article gives a correct appreciation of your personality and your activities?
FUNK: Generally, yes.
MR. COUNSELLOR RAGINSKY: I have no more questions to ask.
[Dr. Dix approached the lectern.]
THE PRESIDENT: What is it you wish to say, Dr. Dix?
DR. DIX: I have only one question for the witness, which was brought up by the cross-examination of Mr. Dodd. I could not put this question any sooner, since I am asking it only because of what Mr. Dodd said.
THE PRESIDENT: Yes, go on.
DR. DIX: Witness, Mr. Dodd has put to you a record of your interrogation, according to which Schacht, after leaving the Reichsbank, still had a room there. You have heard the testimony of Schacht here. He testified clearly that he did not have a room at the Reichsbank but that the Reich Government put a room in his apartment at his disposal and contributed to the rent, and that the Reich Government paid a secretary whom he took with him from the Reichsbank, but who was now paid by the Reich Government and not by the Reichsbank. That was the testimony of Schacht. By your answer given to Mr. Dodd it was not quite clear whether you have any doubt about the correctness of that statement by Schacht. I ask for your opinion.
FUNK: I do not know anything about the apartment of Dr. Schacht. I was told at the time that he still came frequently to the Reichsbank and that a room was reserved for him. If that information was not correct, then it is not my fault. I do not doubt that what Dr. Schacht said is correct. He must know the arrangements concerning his apartment better than I do.
THE PRESIDENT: Dr. Sauter, do you wish to re-examine?
DR. SAUTER: Mr. President, we have found this final questioning of the Defendant Dr. Funk harder to follow than the other cases, because the translation caused serious difficulties. I have to admit, frankly, that I have been able to understand only part of what has been said here. The defendant may probably have had the same difficulty and therefore I should like to reserve the right Mr. President, after I receive the stenographic record, to make one or two corrections, if the transcript should show this to be necessary. It has also been made more difficult for us, Mr. President, because in the course of cross-examination a large number of extensive documents was submitted to the Defendant Dr. Funk. We are gradually becoming used to those surprises. Moreover, the Defendant Funk was supposed to give answers to questions concerning documents which he had not issued which had nothing to do with his activities, which he...
THE PRESIDENT: Dr. Sauter, the Tribunal saw no sign at all of the Defendant Funk not being able to understand thoroughly every question put to him. And I think that therefore there is no reason for any protest on your behalf and you should go on to put any question you wish to put in re-examination—let us say, questions which arise out of the cross-examination.
DR. SAUTER: Mr. President, on our earphones, at least on this side, we could not understand quite a number of questions. Whether it applied to these particular earphones or to the entire apparatus I do not know.
THE PRESIDENT: Well, if the Defendant Funk did not understand any questions put to him, he could have said so. He did not say so. He answered all the questions from a logical point of view, perfectly accurately. You can ask him if you like, if he did not understand any of the questions put to him.
DR. SAUTER: Now, Herr Funk, the Prosecution among other things has put to you that you participated in the exploitation, the spoliation of France. In this connection is it correct that the merchandise, the consumer goods which came from France, were in many cases manufactured from raw materials which had come from Germany?
FUNK: Certainly. We continuously delivered coal, coke, iron, and other raw materials in France, so that they could produce goods—we delivered especially those raw materials which the French did not have in the country themselves. There was a very active exchange of production and a very close productive co-operation between the German and French economy. Even the same organizational methods were used.
DR. SAUTER: Dr. Funk, excerpts from an article which appeared on the occasion of your birthday have been read before. Do you know the author of that article?
FUNK: Yes, from the earlier years.
DR. SAUTER: Did he receive any factual material from you for that article?
FUNK: No.
DR. SAUTER: Did he not ask for it?
FUNK: No, I did not know anything about that article beforehand. I did not order a birthday article for myself.
DR. SAUTER: Precisely. So you did not know anything about that article and therefore, if I understand you correctly, there is no guarantee that what is said in this article is completely true.
FUNK: No. But I find that the tendency of the article is generally very good. The tendency...
DR. SAUTER: Witness, the American prosecutor confronted you yesterday with the matter of your negotiations with Rosenberg in the spring of 1941 and the fact that at that time, a few months before the march into Russia, you had these negotiations with Rosenberg. He apparently wanted to conclude that you had admitted, or wanted to admit, that you had known about the intention of Hitler to wage an aggressive war against Russia. You did not have a chance to say anything on this yesterday. Therefore I should like to give you another opportunity now to state very clearly what your belief was at that time concerning the intentions of Hitler in the spring of 1941, when you negotiated with Rosenberg, and what you knew about any possible causes for war before that time.
FUNK: As to the question of the American prosecutor, I did not understand it to mean that I knew anything about an aggressive war against Russia. The prosecutor spoke explicitly about preparations for war with Russia. I myself had already made it quite clear that I was completely surprised when the task was assigned to Rosenberg, and I was informed by Dr. Lammers as well as by Herr Rosenberg, that the reason for the assignment was that the Führer was expecting a war against Russia, because Russia was deploying large numbers of troops along the entire eastern border, because Russia had entered Bessarabia and Bukovina and because his negotiations with Molotov brought proof that Russia maintained an aggressive policy in the Balkans and the Baltic area, whereby Germany felt herself threatened. Therefore preparations had to be made on the part of Germany for a possible conflict with Russia. Also, concerning the meeting which the American prosecutor has mentioned, I said explicitly that the measures concerning currency which were discussed there were approved by me, because we created thereby stable currency conditions in the Occupied Eastern Territory. I was therefore opposed to the idea that the German Reichsmark, which the Russian population would not have accepted because they could not even read it, should be introduced there.
DR. SAUTER: Witness, the Soviet Russian prosecutor has pointed out again and again that you were not only Reichsbank President and Reichsminister of Economics, but also Plenipotentiary for Economy. You have corrected that already and pointed out that from the very beginning when you were appointed, your authority as Plenipotentiary for Economy was practically taken over by Göring, and that, I believe, in December of 1939, your authority as Plenipotentiary for Economy was also formally turned over to Göring.
MR. DODD: I wish to enter an objection not only to the form this examination is taking, but as to its substance. Counsel is in effect testifying himself, and he is testifying about matters that the witness testified to on direct examination, and it seems clear to us that this cannot be helpful at all to the Tribunal as a matter of re-direct examination.
THE PRESIDENT: Dr. Sauter, is it really proper for you to get the witness to go over again the evidence which he has already given? The only object of re-examination is to elucidate any questions which have not been properly answered in cross-examination. The witness has already dealt with the topics with which you are now dealing, in the same sense which you are now putting into it.
DR. SAUTER: I have repeated the statements only because I want to put a question to the witness now concerning a document which was submitted only yesterday, which had not been submitted until then, and to which I could therefore not take any position; and because the Soviet Russian prosecutor has again made the assertion here that the defendant also during the war was Plenipotentiary for Economy, although that is not correct. Mr. President...
THE PRESIDENT: I have heard myself the witness say over and over again that he was not the Plenipotentiary General for Economy during the war. He has repeatedly said that.
DR. SAUTER: But it has been repeated from this side. Mr. President, yesterday a document was submitted which bears the Document Number EC-488.
THE PRESIDENT: What is the document you want to deal with?
DR. SAUTER: Number EC-488. It was presented yesterday, and is a letter dated 28 January 1939. On the front page it is marked in large letters “Secret.” Here in the original is the heading, which is in capital letters, and it reads, “The Plenipotentiary for War Economy.” So much for the heading of the letter paper. Then the word “War” is crossed out, so that you can read only, “The Plenipotentiary for Economy.”
Therefore, before 28 January 1939 the title of Plenipotentiary for War Economy must have been changed to a new title, “Plenipotentiary for Economy.” I now ask that the defendant...
THE PRESIDENT: Yes, I see. The copy that we have before us has not got the word “War” in it at all.
DR. SAUTER: It can be seen on the photostat.
THE PRESIDENT: I see it. But what is the question you want to put?
DR. SAUTER: At the time when this letter was written, the Plenipotentiary was the Defendant Funk. I should like to ask to be permitted to put the question to him, how it can be explained that the title of his office—that is, Plenipotentiary for War Economy—was changed. The question would be how it could be explained that the title of his office, “Plenipotentiary for War Economy” had been changed to the new title, “Plenipotentiary for Economy.”
FUNK: The reason is...
DR. SAUTER: One moment, Dr. Funk, please.
THE PRESIDENT: I did not ask you to stop putting your question. You can put your question. Go on. What is the question?
DR. SAUTER: Go on, Dr. Funk.
FUNK: The reason was that according to the old Reich Defense Law, Schacht had been appointed Plenipotentiary for War Economy, and on the basis of this second Reich Defense Law, which appointed me, I was appointed Plenipotentiary for Economy, because at that time it was quite clear that the special tasks concerning war economy—that is to say, armament industry, war economy proper—could no longer remain with the Plenipotentiary for Economy, but that he had essentially to co-ordinate the civilian economic departments.
DR. SAUTER: In connection with that, Mr. President, may I call your attention to another document which was submitted yesterday. That is Number 3562-PS. Here the heading already has the correct new title, “Plenipotentiary for Economy.” That is no more “Plenipotentiary for War Economy,” and that is also a new document which was submitted only yesterday. Mr. President...
MR. DODD: Just to keep the record straight, Mr. President, that Document 3562-PS is in evidence, and it was submitted by Lieutenant Meltzer at the time he presented the case against the individual Defendant Funk.
THE PRESIDENT: Mr. Dodd, am I not right in thinking that the Defendant Funk stated from the outset in his examination in chief that he was appointed Plenipotentiary General for Economy?
MR. DODD: Yes, indeed, Sir. That is as I thoroughly understand it.
THE PRESIDENT: And you have not challenged that?
MR. DODD: We have not challenged the fact that he said so. But we do challenge the fact that he, in fact, was only for economy. We do maintain that he, in fact, had much to do with the war effort as the Plenipotentiary.
THE PRESIDENT: Yes. But he was not to be named that?
MR. DODD: No. And that Document EC-488 was not offered, anyway, for that purpose, but rather to show that the defendant was engaged in talking about what prisoners of war would do after an attack.
DR. SAUTER: Yesterday a document was produced about the interrogation of a certain Hans Posse. It is Document 3894-PS. The witness Hans Posse was formerly State Secretary in the Ministry of Economics and as such Deputy Plenipotentiary for Economy. That record has been submitted by the Prosecution in order to show that allegedly there was a struggle for power, as it says here, between Funk and Göring.
However, I should like to quote to the witness a few other points from that record so that several other points can also be used as evidence:
Witness, State Secretary Hans Posse says, for instance—and I should like to ask whether this is still your opinion today—that is Document 3894-PS, Page 2 of the German translation, at the bottom of the page—he was asked, “How often did you report to Funk in connection with your duties as Deputy to the Plenipotentiary?”
The witness answered then, “The Plenipotentiary for Economy never really went into action.”
FUNK: I must repeat what I said again and again, and what has been confirmed by everybody who has been heard on that question. That was a post which was merely on paper.
DR. SAUTER: Then the witness was asked to what final end you, Dr. Funk, had worked.
It says, “Dr. Posse, is it correct that the office of Plenipotentiary for Economy was established to the final end of uniting all economic functions with a view to the preparation for war?”
Then the witness answered, “The purpose was what I have just said—to co-ordinate the various conflicting economic interests. But there was no talk about the preparation for war.”
And on the same page, on Page 4, at the bottom, the witness says, I quote:
“It is correct that the aim was to co-ordinate all economic questions, but the purpose was not to prepare for war. Of course, if war preparation should become necessary, it was the task of the Plenipotentiary for Economy to concern himself with these questions and to act as a co-ordinator.”
FUNK: Herr Posse was an old, sick man, whom I had put in this post. He was formerly State Secretary under Schacht, and when I took over the ministry, I received a new State Secretary through Göring who, unfortunately, later became insane. And then State Secretary Dr. Landfried came to me, and Posse, who formally was still in the Ministry of Economics as State Secretary, was without a job. Therefore I made him an executive officer attached to the Plenipotentiary for Economy.
Here, of course, he had constant difficulties from the very beginning. The High Command of the Armed Forces or the War Economy Staff wanted to reduce the authority of the Plenipotentiary, as can be seen from the letter which was presented yesterday. And the civilian economy department did not want to follow his directives because they already had been subordinated to and had to follow the directives of the Delegate for the Four Year Plan. Therefore, as a matter of fact, that unhappy Plenipotentiary for Economy held a post which to all intents and purposes existed only on paper.
THE PRESIDENT: Would this not be a convenient time to break off now?
[The Tribunal recessed until 1400 hours.]
Afternoon Session
DR. SAUTER: Mr. President, I have two more questions which I wish to put to the Defendant Dr. Funk.
[Turning to the defendant.] Dr. Funk, before the recess we stopped at Document 3894-PS, the testimony of your State Secretary Posse. I should like to read one passage on Page 7 of the German text and ask you whether you agree with it. The witness Posse was asked by the Prosecution whether he, as Deputy Plenipotentiary for Economy, knew about the international relations, especially about the war situation and so forth, and he says, on Page 7, in the middle:
“We never knew anything about the international situation and we never heard anything about it, and if the international situation was mentioned in our discussions we could always voice merely our personal opinions.”
And a few lines further down:
“We”—he means apparently himself and you, Dr. Funk—“We always hoped that there would be no war.”
Do you agree with this opinion of your former State Secretary Posse?
FUNK: Yes. I have said repeatedly that until the end I did not believe that there would be a war, and the same is true of my colleagues, and everyone who spoke to me at that time will corroborate this. Herr Posse was, of course, still less informed about political and military events than I was. Consequently, that also applies to him.
DR. SAUTER: Then I have a final question to put, Witness. You have seen the film which the Prosecution has presented. Now, you were the President of the Reichsbank. Consequently you are familiar, possibly only superficially with the conditions in the vaults of the Reichsbank, at least, I assume, in Berlin, if not in Frankfurt, where the film was taken; and you also know how, especially during the war, these items which had been deposited with the bank in trunks or packages and the like were safeguarded. Possibly, Dr. Funk, on the basis of your own knowledge of the conditions you can make a statement regarding this short film which we have seen.
FUNK: I was completely confused by this film and most deeply shocked. Photography and especially films are always very dangerous documents because they show many things in a light different from what they really are. I personally have the impression, and I believe the Prosecution will probably corroborate this, that all these deposits of valuables and this entire collection of valuable items came from the potassium mines where, at my instigation, all gold, foreign currency and other valuables of the Reichsbank had been stored away when, because of a terrific bombing attack on Berlin, we were no longer able to work in the Reichsbank. The Reichsbank building alone in this one raid on 3 February 1945 was hit by 21 high explosive bombs; and it was only by a miracle that I was able to reach the surface from this deep cellar together with 5,000 other people. Gold, foreign currency, and all other deposits of valuables were then taken to a potassium mine in Thuringia and from there apparently to Frankfurt, I assume. So this concerns, to a large extent, normal deposits by customers who had placed their valuables, their property, in these safe deposits which could not be got at by the Reichsbank. Consequently I cannot tell from this film which of these items were deliveries by the SS and which were genuine deposits. The Prosecutor certainly is correct when he says that no one would deposit gold teeth in a bank. It is, however, quite possible that certain functionaries of concentration camps made genuine deposits in the Reichsbank which contained such articles, to safeguard them for future use. I think that is possible. However, in conclusion I must say once more that I had no knowledge whatsoever of these things and of the fact that jewelry, diamonds, pearls, and other objects were delivered from concentration camps to the Reichsbank to such an extent. I knew nothing about it; it was unknown to me, and I personally am of the opinion that the Reichsbank was not authorized to do this kind of business. It is certainly clear from one document, which contains an account for the Minister of Finance, that most likely everything from the concentration camps was first brought to the Reichsbank and then the unfortunate officials of the Reichsbank had to sort it, send it on to the Minister of Finance—or rather to the pawnbroker who was under the Minister of Finance—and prepare a statement of account. Therefore, I must request that someone be examined on these matters—first of all Herr Puhl himself, and perhaps someone else who was concerned with these things—in order to explain what actually took place and above all, to show that I personally had no knowledge whatsoever of these matters except for the few facts which I myself have described to the Court.
DR. SAUTER: Mr. President, I have finished my interrogation of the Defendant Funk, and I should now like to ask permission to examine the only witness whom I can call at this time, the witness Dr. Hayler.
THE PRESIDENT: Very well.
MR. DODD: [Interposing.] Mr. President, may I raise one matter before the witness is excused? This Document 3894-PS, that we have quoted from and that the defendant has quoted from, contains a number of other quotations and I think it would be well if we submitted the whole document in the four languages; and I shall be prepared to do that so the Tribunal will have the benefit of the whole text. So far we have both been quoting from it, but I think it would be most helpful to the Court if it had the whole text.
And may we ask, Mr. President, shall we make arrangements or should I do anything about getting the witness Puhl here?
THE PRESIDENT: Dr. Sauter, have you any request to make with reference to the witness Puhl, who made an affidavit?
DR. SAUTER: Regarding the witness Emil Puhl I beg to request, Mr. President, that he be brought here for cross-examination. I was going to make that request in any case.
THE PRESIDENT: Yes, certainly, Dr. Sauter, the witness Puhl should be brought here. He will be brought here as soon as possible.
DR. SAUTER: Thank you.
THE PRESIDENT: Now the defendant can return to the dock.
[The witness Dr. Hayler took the stand.]
THE PRESIDENT: Will you state your full name?
HAYLER (Witness): Franz Hayler.
THE PRESIDENT: Will you repeat this oath after me: I swear by God—the Almighty and Omniscient—that I will speak the pure truth—and will withhold and add nothing.
[The witness repeated the oath.]
THE PRESIDENT: You may sit down.
DR. SAUTER: Dr. Hayler, how old are you?
HAYLER: 46 years.
DR. SAUTER: Are you a professional civil servant, or how did you get into the Ministry of Economics under Dr. Funk?
HAYLER: I was an independent business man and merchant and as such first became the head of the “Economic Group Retail Trade” within the organization of industrial economy. In this capacity I had very close contact with the Ministry of Economics. After Minister Funk had been appointed Minister for Economics I reported to him regarding the scope of my work, and on that occasion I made his acquaintance. When I was then put in charge of the “Reich Group Trade,” the working relations between the organization directed by me and the Ministry, especially between the then State Secretary Landfried and the Minister himself, became very friendly.
After the separation of the ministries in the autumn of 1943, the main task of the Ministry of Economics was to provide for the German people, that is, the civilian population. As head of the trade organization I was the person responsible for the sale of merchandise, that is, for the procurement of supplies, and during a conference with Minister Funk regarding the co-operation between trade and the Ministry, Herr Landfried, who was then State Secretary, made the suggestion that Minister Funk call me into his Ministry and make me his deputy. Herr Landfried believed that under the existing conditions he himself was not strong enough to carry out this difficult task since the Ministry had been deprived of its influence on production. Then, when Minister Funk told him in reply to his suggestion that he, Landfried, was the deputy of the Minister, Landfried replied that he could not continue to carry out these tasks and that he asked to be permitted to retire and proposed that I be his successor. About two or three weeks later I was put in charge of the affairs of the State Secretary.
DR. SAUTER: When was this conference?
HAYLER: This conference took place in October 1943; my appointment came on 20 November 1943.
DR. SAUTER: So that until the autumn of 1943, Dr. Hayler, you were employed in your organizations only in an honorary capacity?
HAYLER: Yes.
DR. SAUTER: That was, I think, retail trade?
HAYLER: Yes, trade.
DR. SAUTER: And as from 1943 you became official in the Reich Ministry of Economics in the capacity of State Secretary?
HAYLER: I became an official with this position of State Secretary on 30 January 1944.
DR. SAUTER: In this position you were one of the closest collaborators of Dr. Funk?
HAYLER: I was his deputy.
DR. SAUTER: Dr. Hayler, during a conference that we had on the day before yesterday, I discussed with you the question of whether the Defendant Dr. Funk was a particularly radical man or whether, on the contrary, he acted with moderation and consideration toward others. What do you have to say to this question which may have certain importance in forming an opinion on the personality of the Defendant Funk?
HAYLER: Funk is above all very human, and always has been. Radicalism is quite foreign to his entire character and being. He is more of an artist, a man of very fine artistic feeling and scholarly ideas. I believe one can say that at no time was he a doctrinaire or dogmatic. On the contrary, he was conciliatory and anxious to settle disputes. For this reason, in Party circles in particular, he was considered too soft, too indulgent, in fact he was accused many times of being too weak. He tried to protect domestic economy from political encroachment and from unnecessary severity; and because of his respect and his regard for enterprising endeavor and out of his own responsibility to economy and to the people, he fought against unnecessary intervention in various enterprises even during the war. He protected industry against mergers and closures. This finally led to his being deprived of the responsibility for production in the decisive phase of the war.
I recall from the time of my collaboration with him, when I was still in charge of the trade organization, that Funk on various occasions interceded for men in the industrial world who were in political difficulties. I believe, however, that because of these individual cases, such as his intervention on behalf of Consul General Hollaender or of Herr Pietsch, and because of his attempts to promote peace, he at that time had to expect grave consequences; also because of his intervention in the case of Richard Strauss, as is surely known, and in similar cases. I do not think these individual cases are of such importance as perhaps the following: After the catastrophe of 9 November 1938 the process of Aryanization was to be intensified in the Ministry of Economics; and at that time a few political men were forced upon the Ministry, especially Herr Schmeer. I remember distinctly that at that time Landfried in particular, as well as Funk, slowed down considerably this radicalization of the Ministry; and Funk and the Ministry were blamed for doing so.
After 8 and 9 November I once had a conference regarding the events of that date with Himmler, in which I voiced my complaints. Himmler on that occasion finally reproached both Funk and myself by saying, among other things:
“Finally, you people on the economic side and connected with the economic management are also to blame that things have gone too far. People like Herr Schacht cannot be expected to do anything except go slow all the time and oppose the will of the Party; but if you and Funk and all you people on the economic side had not slowed things down so much, these excesses would not have happened.”
DR. SAUTER: Yes, Dr. Hayler; another question. You also worked with Dr. Funk in matters concerning the economy of the occupied territories. Dr. Funk is accused of having played a criminal part in despoiling the occupied territories as well as in destroying their currency and economic systems. Could you enlighten the Court as briefly as possible on the Defendant Funk’s attitude and activities? As briefly as possible.
HAYLER: I believe two facts must be stated first of all: First, the influence of the Ministry of Economy on the occupied territories was relatively limited. Secondly, during the year in which I was in the Ministry these questions were no longer particularly important.
Generally speaking, the position was as follows: Funk was constantly accused of thinking more of peace than of war. The opinions he proclaimed both in his speeches and in print referred to a European economic policy; and I assume that these talks and publications or articles are before the Court.
DR. SAUTER: Yes, they are here.
HAYLER: Funk looked at the occupied territories from exactly the same point of view. He raised repeated objections to the over-exploitation of the occupied territories and expressed the view that wartime co-operation should form the basis of later co-operation in peace. His view was that confidence and willingness to co-operate should be fostered in the occupied territories during the war. He expressed the view that the black market cannot be combated by the black market and that, since we were responsible for the occupied territories, we must avoid anything likely to disturb the currency and economic system of these territories.
I think I remember that he also discussed the question with the Reich Marshal and defended his own point of view. He also repeatedly opposed unduly heavy occupation expenses, and always favored the reduction of our own expenditure, that is, of German expenditure in the occupied territories. In other words, he regarded the occupied territories in exactly the same way as other European countries; and this attitude is best illustrated by the speech he made in Vienna, I believe, in which he publicly acknowledged as genuine debts the clearing debts, the high totals of which were due mainly to differences in price, that is, inflationist tendencies, in the countries which delivered the goods.
DR. SAUTER: Dr. Hayler, the Defendant Funk is furthermore accused of playing a criminal part in the enslavement of foreign workers. This accusation applies particularly to the period during which you were a co-worker of Dr. Funk. Can you tell us briefly how Funk thought and acted in regard to this point?
HAYLER: There can be no question of Funk’s co-operation in questions regarding the employment of foreign labor at this time, but only within the scope of his responsibility in the Central Planning Board. But it remains to be seen whether the Central Planning Board was at all responsible for the employment of workers or whether the Central Planning Board did nothing more than ascertain the manpower needs of the various production spheres. However, regardless of what the tasks of the Central Planning Board may have been, Funk’s position in the Central Planning Board was the following:
Funk, as Minister of Economy, was responsible for the supplies for the civilian population and for export. In the period following the separation of the ministries, no additional foreign worker I believe was employed in the production of supplies for civilians or for export. On the contrary, Funk was constantly confronted with the fact that during that time German and foreign workers were continually being removed from the production of consumer goods and put into armament production. Consequently, I cannot imagine that an accusation of this sort can be made against Funk with reference to this period of time.
On this occasion I should like to emphasize another point which seems important to me. Provisioning the foreign workers was a very serious question. I believe that even Herr Sauckel will corroborate the fact that, when this question came up, Funk was at once ready—even though there was already a great scarcity of provisions for the German people due to many air raids and destructions—to release large quantities of supplies and put them at the disposal of the foreign workers.
DR. SAUTER: If I understand you correctly, he tried to see to it that the foreign workers who had to work in Germany were supplied as well as was possible with consumer articles: food, shoes, clothes, and so on.
HAYLER: Particularly shoes and clothing; Funk was not the competent authority for food.
DR. SAUTER: Shoes and clothing?
HAYLER: Yes, I have specific knowledge of this. And as a result Funk had considerable difficulty; for the Gauleiter, in view of the great scarcity of goods, did their best to secure supplies for the inhabitants of their own Gaue for whom they were responsible, and in so doing used every means which came to hand. Funk constantly had to oppose the arbitrary acts of the Gauleiter, who broke into the supply stores in their Gaue and appropriated stocks intended for the general use.
DR. SAUTER: Dr. Hayler, do you know whether Dr. Funk—I am still referring to the time when you worked with him—represented the viewpoint that the foreign worker should not be brought to Germany to work here but that rather the work itself should be taken from Germany into the foreign countries so that the foreign worker could perform his work in his home country and remain at home? Please answer that.
HAYLER: I know very well that Funk represented that viewpoint; and it is in accordance with his general attitude, for the political disquiet and dissatisfaction which accompany the displacement of such large masses of human beings temporarily uprooted was in opposition to the policy of appeasement and reconstruction which was definitely Funk’s goal.
DR. SAUTER: I now come to the last question which I wish to put to you, Dr. Hayler. When the German armies retreated and when German territories were occupied by enemy armies, difficulties arose regarding the supplying of these territories with money. At that time Hitler is supposed to have planned a law according to which the acceptance and passing on of foreign occupation money was to be punished even by death. I am not interested now, Dr. Hayler, in finding out why Hitler planned to do this; but I am interested in finding out, if you can tell me, how the Defendant Funk reacted to this demand by Hitler and what success he had.
HAYLER: Two facts can be established in regard to this point, which should be of interest to the Tribunal. I have rarely seen Funk as depressed as at that time, after he had received information about the so-called “scorched earth decree.” I believe he was the first minister to issue at that time two very clear decrees, one from the Ministry of Economics, in which he gave definite instructions that wherever German people were an administration of economy in some sort of form must remain; where it is necessary that people be provided for, the State must continue to provide for these people.
The second decree was issued at the same time by the President of the Reichsbank, in which he decreed that the money market had to be cared for by the remaining offices of the Reichsbank in the same way that economy was to be cared for.
Regarding your question itself, I recall very distinctly that the Führer himself, it was said, had demanded of the Ministry of Economics the issuing of a legal regulation according to which the acceptance of occupation money was forbidden to every German on pain of death. Herr Funk opposed this demand very energetically, I believe with the help of Herr Lammers. He himself telephoned headquarters repeatedly and finally succeeded in having the Führer’s directive withdrawn.
DR. SAUTER: Have you finished, Dr. Hayler?
HAYLER: Yes.
DR. SAUTER: Mr. President, I have no further questions to put to the witness.
THE PRESIDENT: Do the other Defendants’ Counsel wish to ask any questions?
[No response.]
Does the Prosecution wish to cross-examine?
MR. DODD: When did you join the Nazi Party, Mr. Witness?
HAYLER: Did I understand you correctly—when did I become a member of the NSDAP?
MR. DODD: That is right.
HAYLER: December 1931.
MR. DODD: Did you hold any offices in the Party at any time?
HAYLER: No; I never held office in the Party.
MR. DODD: You were the head of a trade group in 1938, the Reichsgruppe “Handel”?
HAYLER: I was the head of the Economic Group “Retail Trade” from 1934 on, and from 1938 on, head of the Reich Group “Trade.” This organization was a part of the organization of industrial economy and was under the Reich Ministry of Economics.
MR. DODD: Membership in the group that you were the head of was compulsory, wasn’t it?
HAYLER: Yes.
MR. DODD: When did you join the SS?
HAYLER: I joined the SS in 1933, in the summer.
MR. DODD: That was a kind of Party office, wasn’t it, of a sort?
HAYLER: No, it was not an office. I became connected with the SS because of the fact that in Munich 165 businessmen were locked up and because I knew Himmler from my student days—I had not seen him again until then—the businessmen in Munich asked me to intercede for them in the summer of 1933. But I had no office in the Party or in the SS.
MR. DODD: When did you become a general in the SS?
HAYLER: I never was a general in the SS. After I had been appointed State Secretary, the Reichsführer bestowed on me the rank of a Gruppenführer in the SS.
MR. DODD: A Gruppenführer—isn’t that the equivalent of a general in the SS?
HAYLER: Yes and no. In the SS there was the rank of Gruppenführer and there was the rank of Gruppenführer and general of the Police or of the Waffen-SS; but the Gruppenführer was not a general if it was only an honorary rank. This could easily be seen from our uniforms, because we did not wear a general’s epaulets or a general’s uniform.
MR. DODD: You know Ohlendorf pretty well, don’t you?
HAYLER: Yes.
MR. DODD: He worked for you at one time. He was under your supervision. Isn’t that so?
HAYLER: I worked with Ohlendorf from 1938 on.
MR. DODD: You know, he has testified before this Tribunal that he supervised the murdering of 90,000 people; did you know that?
HAYLER: I heard about that.
MR. DODD: Did you know about it at the time that it was going on?
HAYLER: No.
MR. DODD: Did you know Pohl, the SS man—P-o-h-l?
HAYLER: May I ask you for that name again?
MR. DODD: Pohl—P-o-h-l?
HAYLER: I do not remember knowing an SS man Pohl.
MR. DODD: Do you know a man called Obergruppenführer Pohl of the SS?
HAYLER: No—Yes, I know an Obergruppenführer Pohl. Obergruppenführer Pohl was the chief of the administrative office of the SS.
MR. DODD: Did you have conversations and meetings with him from time to time?
HAYLER: Officially I had a few conversations with Pohl. Usually they were very unpleasant.
MR. DODD: Well, that’s another matter. How often would you say, between 1943 and the end, the time of your surrender, that you met with Pohl to discuss matters of mutual interest between the SS and your own Ministry of Economics? Approximately, because I don’t expect you to give an accurate account, but about how many times, would you say?
HAYLER: I must give a short explanation about this. Between the...
MR. DODD: Give that afterwards. Give me the figure first.
HAYLER: Yes. Perhaps three or four times, perhaps only twice. I do not know exactly.
MR. DODD: Are you telling us three or four times a year or three or four times during the whole period between 1943 and 1945?
HAYLER: During my time in office, yes, three or four times; it was only one year.
MR. DODD: Did you talk to him about the Reichsbank’s or the Ministry of Economics’ co-operating in the financing of the building of factories near the concentration camps?
HAYLER: No.
MR. DODD: You know about that, do you?
HAYLER: No. This question was never discussed with me.
MR. DODD: What did you talk to him about?
HAYLER: A great controversy had arisen between the Ministry of Economics and the SS because after I had taken over the State Secretariat in the Ministry of Economics, Himmler had instructed me to turn over to the SS a factory which belonged to the Gau Berlin. I fought against this and did not obey Himmler’s instructions. The files about this must surely still be in existence. I then was instructed to discuss this matter with Pohl. In these conferences and in a personal conversation which Himmler requested and ordered, I still fought against Himmler’s instructions, because I was fundamentally against the SS having industrial enterprises of its own.
MR. DODD: Did you talk to the Defendant Funk about this difficulty with Himmler and Pohl?
HAYLER: Yes, because these difficulties resulted in Himmler’s writing me a letter in December in which he told me that he ceased to have confidence in me and that he had no desire to work with me any more. I reported this to the Defendant Funk in December.
MR. DODD: Did Funk tell you that his bank was helping Himmler out in the building of factories near the concentration camps?
HAYLER: I know nothing about that.
MR. DODD: You never heard of that before now?
HAYLER: Up until now I have never heard anything about Funk’s or the Ministry of Economics’ co-operation in the financing of such buildings or about anything of the sort.
MR. DODD: It is perfectly clear, I think, but I want to make certain, that from 1943 to 1945, while you were the deputy to Funk in the Ministry of Economics, the questions of purchasing on the black market, and so on, in the occupied countries ceased to be of any real importance, didn’t they? You said that; I understood you to say that a few minutes ago yourself.
HAYLER: In 1944—and my time in office virtually did not start until 1944, since in December I had a Ministry which was totally bombed out and we did not get started working again until January 1944—these questions were no longer of decisive importance, since a process of retrogression had already set in.
MR. DODD: All right. You also were, Mr. Witness, at the Vienna speech to which you referred, which was made in 1944; and it had nothing to do with the occupied countries but was directed only at the satellite states. Are you aware of that or not?
HAYLER: The speech in Vienna?
MR. DODD: Yes, the speech in Vienna in 1944.
HAYLER: Yes, it is true; I have already said that. Both the speech in Königsberg and the speech in Vienna did not deal directly with the occupied territories, but with Europe as a whole. I...
MR. DODD: Did it deal with the occupied territories directly or indirectly? Now, have you read that speech?
HAYLER: I heard the speech. Quite definitely it had nothing to do with them directly.
MR. DODD: Finally, in view of your testimony concerning Funk and what he thought about forced labor, you know, don’t you, that he took an attitude of unconcern about the forcing of people to come to Germany? Do you know that?
HAYLER: No.
MR. DODD: Well, you know he has said on interrogation that he didn’t bother his head about it, although he knew that people were being forced to go to Germany against their will. Are you aware of that?
HAYLER: No, I am not aware of that. I had with Funk...
MR. DODD: All right. If you did know it, would that make some difference to you; and would you change your testimony some?
HAYLER: I am not aware of the fact that Funk is supposed to have had this attitude or...
MR. DODD: Very well. Perhaps I can help you by reading to you from his interrogation of 22 October 1945, made here in Nuremberg. Among other things, he was asked these few questions and made a few answers:
“As a matter of fact, you were present at many meetings of the Central Planning Board, were you not?”
Funk answered and said:
“I was present at the meetings of the Central Planning Board only when something was required for my small sector; that is to say, something which had to do with the export and consumer goods industries as, for example, iron. I had to put up a fight on each occasion to get just a few thousand tons for my consumer goods industry.”
The next question was:
“Yes, but during those meetings you attended, you heard, did you not, discussions concerning forced labor?”
Funk answered: “Yes.”
“Question: ‘And you knew from those meetings that the policy was to bring in more and more foreign workers to the Reich against their will?’”
Funk answered: “Yes, certainly.”
“Question: ‘And you never objected to that, I take it?’”
Funk answered:
“No, why should I have objected? It was somebody else’s task to bring these foreign workers into the Reich.
“Did you believe it was legal to take people against their will from their homes and bring them into Germany?” was the last question that I want to quote to you. He answered: “Well, many things happen in wartime which aren’t strictly legal. I have never racked my brains about that.”
Now, if you know that to be his attitude from his statements made under oath on an interrogation here, would that change your view about Funk and would it cause you to change the testimony which you have given before the Tribunal here today?
HAYLER: I can testify only to those things which I myself know. I cannot remember any such statements by Funk. I do know and I remember distinctly that we frequently spoke about the occupied territories, about the later development in Europe which was to, and could, result from co-operation. We also spoke about the procuring of workers and that Funk fundamentally had a viewpoint different from the one that prevailed and that he was not in agreement with these things. I can merely repeat this and if you question me here as a witness, I can say only what I know.
MR. DODD: Did you go over all of your questions and answers with Dr. Sauter before you took the stand? You knew what you were going to be asked when you came here, didn’t you?
HAYLER: Dr. Sauter gave me an idea what he would question me about and what he was interested in.
MR. DODD: I have no further questions.
THE PRESIDENT: Do any other members of the Prosecution wish to cross-examine? Dr. Sauter, do you want to re-examine?
DR. SAUTER: No.
THE PRESIDENT: The witness can retire.
[The witness left the stand.]
DR. SAUTER: Mr. President, there are a few interrogatories missing, some of which have already arrived and are being translated. I request that at a later occasion, perhaps after the case against Defendant Schirach, I be permitted to read these interrogatories. And then, Mr. President, I should like to say something of a general nature. I have already read extracts from various documents and requested that all of them be admitted as evidence and I should like to repeat this request for all these documents. With that I shall have finished my case for Funk.
Mr. President, may I make another request of you at this moment, namely, that during the next few days the Defendant Von Schirach be excused from being present at the sessions in Court so that he can prepare his case. In his absence I shall look after his interests or else, when I am not here, my colleague Dr. Nelte will. Thank you very much.
THE PRESIDENT: Who is appearing for the Defendant Schirach?
DR. SAUTER: I am; and when I cannot be present, then Dr. Nelte will. One of us will always be in Court and look after his interests.
THE PRESIDENT: Yes, very well, Dr. Sauter. Now the Tribunal will adjourn for 10 minutes.
[A recess was taken.]
THE PRESIDENT: Dr. Sauter, there was a document which you didn’t refer to. I think it was an affidavit of a witness called Kallus. Were you offering that in evidence? It was an interrogatory of Heinz Karl Kallus.
DR. SAUTER: The Kallus interrogatory, Mr. President, has already arrived and at the moment it is in the process of translation, I shall submit it as soon as the translation has been received by the Prosecution.
THE PRESIDENT: Well, we have got a translation into English.
DR. SAUTER: I believe, Mr. President, that what you have is an affidavit by Kallus, and in addition there is a Kallus interrogatory, which is in process of translation and which I shall submit later.
THE PRESIDENT: This takes the form of an interrogatory, questions and answers, what I have in my hand. I am only asking whether you want to offer that.
DR. SAUTER: Yes, I offer that in evidence. I request that judicial notice be taken of it.
THE PRESIDENT: Very well; you gave it a number then, did you? What number will it be?
DR. SAUTER: Exhibit Number 5, if you please.
THE PRESIDENT: Very well.
DR. SAUTER: Thank you very much.
THE PRESIDENT: Now, Dr. Kranzbühler.
FLOTTENRICHTER OTTO KRANZBÜHLER (Counsel for Defendant Dönitz): Mr. President, first I should like to ask the permission to have a secretary, in addition to my assistant, in the courtroom, in order to facilitate the submission of documents.
With the permission of the Tribunal, I shall first submit a number of documents; and I shall use the document book of the Prosecution and the document books which I have submitted. These document books consist of four volumes. The table of contents is in Volume I and in Volume III.
In the first document of the document book of the Prosecution, Exhibit USA-12 (Document Number 2887-PS), I should like to correct an error in translation which may be of significance. It says there, in the German text, under “1939,” “Konteradmiral, Befehlshaber der Unterseeboote,” and that in the English text has been translated by “Commander-in-Chief.” The correct translation should be “Flag Officer of Submarines.” That point is of importance in regard to the fact that Admiral Dönitz, until his appointment as Commander-in-Chief of the Navy in 1943, was not a member of the group which the Prosecution terms criminal.
I should like to call the attention of the Tribunal back to Exhibit GB-190 (Document Number D-652 (a-b)). That is a sea-chart which the Prosecution has submitted. This chart shows the position of the German submarines to the west of England on 3 September 1939, and the Prosecution uses that chart as evidence for the question of aggressive war.
The Prosecution says, rightly, that these U-boats must have left their home bases at an earlier date. The first document, which I offer as Dönitz-1, is to prove, first, that this belongs in the category of measures resorted to in times of crisis such as were taken by every nation in Europe at this time, and that they were in no way preparatory measures for an aggressive war against England, because such a war was not planned.
I shall read from this document—document book, Page 1. It is an excerpt from the War Diary of the Naval Operations Staff of September 1939, and I read the entry of 15 August:
“Prepared (for Case White) the following measures:”
THE PRESIDENT: What page?
FLOTTENRICHTER KRANZBÜHLER: Page 1 of the document book, Volume I.
THE PRESIDENT: Yes.
FLOTTENRICHTER KRANZBÜHLER:
“15. 8. Prepared (for Case White) the following measures:
“On 15. 8. Spee and all Atlantic submarines ready to sail.
“On 22. 8. Transport Westerwald ready to sail.
“On 25. 8. Deutschland ready to sail.”
And then we find the list of these ships:
“21. 8. Report B-service about emergency measures of French fleet.
“23. 8. Report B-service: Continuation of French emergency measures of fleet to 3rd grade. English and French blockade measures off ports.
“25. 8. B-service reports: German and Italian steamers are being watched and reported by France.”
And then the instructions:
“31. 8. Arrival Order I of OKW for conduct of war: Forcible solution in the East, attack against Poland 1 September, 0445 hours. In the West responsibility for starting hostilities unequivocally to be left to England and France. Strictly respect neutrality of Holland, Belgium, Luxembourg, Switzerland. The western border not to be crossed. At sea no hostile actions or such that could be interpreted as hostile. Air Force only in defense.
“In case of opening of hostilities by Western Powers: Defense only, economical use of forces. Reserve start of aggressive operations. The army to hold the ‘Westwall.’ Naval economic war concentrated against England. To augment effect probable declaration of zones of danger. Prepare these and submit them. The Baltic to be safeguarded against enemy invasion.”
So far this document. With the next document, Dönitz-2, I should like to prove that the British submarines, too, were active before the start of the war and appeared in the Bay of Helgoland at the very beginning of the war. It is on Page 2 of the document book. I probably need only point out that as early as 1 September electric motor noises were heard in the Bay of Helgoland and that on 4 September several reports arrived concerning English submarines sighted in the Bay of Helgoland.
I come now to the document with reference to which Admiral Dönitz is accused of participating in the planning of the attack against Norway. That is Exhibit GB-83 (Document Number C-5). The Prosecution has submitted it as proof of the fact that Admiral Dönitz played a decisive part in the occupation of Norway. I shall refer to this document in more detail when examining the witness. I merely want to establish certain dates now. On the document—and I am about to submit the original to the Tribunal—there is a stamp which establishes when the document was received at the High Command. This stamp shows the date 11 October 1939.
THE PRESIDENT: You are speaking of GB-83?
FLOTTENRICHTER KRANZBÜHLER: Yes. And I refer now to Exhibit GB-81 (Document Number C-66), Page 6 of my document book. According to this the decisive report by Grossadmiral Raeder to the Führer had already been made on 10 October 1939, that is, a day before GB-83 was received at the High Command.
With the next document I should like to prove that considerations as to bases had nothing to do with the question of an aggressive war, as far as the Flag Officer of Submarines, Admiral Dönitz, was concerned. I am submitting Documents Dönitz-3 and Dönitz-4. They are on Page 3 and 5 of the Document Book. Dönitz-3 is a war diary of the Flag Officer of Submarines of 3 November 1939, and I read from the second paragraph, the 10th line from the top:
“At the same time Naval Operations Staff reports that there are possibilities for the establishment of a ‘Base North’ which seem to be very promising. In my opinion the immediate introduction of all possible steps in order to arrive at a clear judgment of the existing possibilities is of the greatest importance.”
And then there follows a discussion of the advantages and disadvantages of such a base, which is absolutely identical with the considerations mentioned in GB-83. It is a question of Murmansk in connection with Base North, as can be seen from Document Dönitz-4; and it is known that these considerations were in full accord with the Soviet Union.
Furthermore, I should like to show that the question of bases continuously comes up in enemy navies without reference to...
THE PRESIDENT: Dr. Kranzbühler, you are going a little bit fast over these documents and I am not quite sure that I am quite following what use you are making of them. This base mentioned in the report is Murmansk?
FLOTTENRICHTER KRANZBÜHLER: Yes; Murmansk. And I want to use it as proof, Mr. President, that the question of bases has nothing to do with the question of whether one wants to wage aggressive war with the country in which these bases are situated. The considerations as to Murmansk were taken in full accord with the Soviet Union, and in the same manner Admiral Dönitz took the question of Norwegian bases into consideration. That is the subject of my proof.
THE PRESIDENT: But the fact that Murmansk was suggested as a base, to be taken with the consent of the Soviet Union—if it was the case—doesn’t have any relevance, does it, to taking a base in Norway without the consent of Norway.
FLOTTENRICHTER KRANZBÜHLER: Mr. President, the relevancy seems to me to exist in the fact that Admiral Dönitz, as Commander of U-boats, in both cases received merely the order to state his opinion about bases in a certain country but that in the last analysis he had as little to say in the case of Narvik and Trondheim as in the case of Murmansk.
COLONEL Y. V. POKROVSKY (Deputy Chief Prosecutor for the U. S. S. R.): In Document Number 3, the one just being referred to by the defense counsel for the Defendant Dönitz, mention is definitely made of the northern bases; but nothing is said in this document of any plans of the Soviet Union. And to discuss, here and now, some plan or other of the Soviet Union is in my opinion quite out of order, since there are no plans of the Soviet Union in connection with the northern bases, and there never have been.
FLOTTENRICHTER KRANZBÜHLER: If the representative of the Soviet Union has any doubts that these bases were considered in full accord with the Soviet Union, then I shall prove that by calling a witness.
THE PRESIDENT: Anyhow, the document doesn’t say anything about it.
FLOTTENRICHTER KRANZBÜHLER: The document says nothing about it.
THE PRESIDENT: The Tribunal doesn’t think you ought to make statements of that sort without any evidence; and at the moment you are dealing with a document which doesn’t contain any evidence of the fact.
FLOTTENRICHTER KRANZBÜHLER: May I perhaps read Document Number Dönitz-4?
THE PRESIDENT: It is Dönitz-3, isn’t it?
FLOTTENRICHTER KRANZBÜHLER: I have already come to Dönitz-4. I had read from Dönitz-3. I shall now read from Dönitz-4 the entries for 17 April 1939:
“Commander of U-boats receives instructions from Naval Operations Staff to try out Base North. Naval Operations Staff considers the trying out of the base by U-36 due to sail within the next days, highly desirable. Supply goods for tanker Phoenizia in Murmansk going with fishing steamer to Murmansk on 22 November.”
It seems to me that this entry very clearly shows that that could have happened only in accord with the Soviet Union. Furthermore, I want to show that considerations as to bases...
THE PRESIDENT: Wait a minute. Dr. Kranzbühler, the Tribunal thinks you oughtn’t to make these observations on these documents which really don’t support what you are saying. Document Number 3, for instance, doesn’t bear any such interpretation, because it refers to attacks which it was suggested should be made against ships coming from Russian ports, in Paragraph 2. And equally the other document you referred to, Dönitz-4, on Page 5, doesn’t bear the interpretation which you are putting upon it.
FLOTTENRICHTER KRANZBÜHLER: Mr. President, I am afraid that the contents of both documents have been presented too quickly by me. For anyone who is familiar with such war diaries, many things are self-evident which otherwise are not so easy to understand.
Document Dönitz-3 states in that part which I have read that possibilities for the establishment of a Base North exist. These possibilities can be only political possibilities, because one can establish a base in a foreign country only if that country agrees. Document Dönitz-4 shows that the base in question is Murmansk and that this base is being tried out with a supply ship, a fishing steamer, and a U-boat. That convincingly shows in my opinion...
THE PRESIDENT: The objection the Tribunal was raising was to the statement by you that the Soviet Union had agreed, and these documents do not bear out any such statement.
FLOTTENRICHTER KRANZBÜHLER: I am of the opinion that in Document Dönitz-4 that can clearly be seen. It is not possible...
COL. POKROVSKY: I definitely protest against the fact that, apart from what has been stated in the documents, certain unfounded conjectures or assertions have been made with a view to interpreting the documents in the manner in which Dr. Kranzbühler has endeavored to interpret them from the initial stages of his defense. I do not belong to the category of fortune tellers and palmists. I cannot conjecture what hypothetical conclusions may be drawn from one or another of the documents. I am a lawyer and I am accustomed to operate with documents such as they appear, and I am accustomed to operate with the contents of a document such as they are expressed.
I consider that the Tribunal has quite correctly expressed to the defense counsel the absolute impossibility of drawing the conclusions he is attempting to reach, and I would ask that counsel for the defense be reminded of his duty to limit himself exclusively to such interpretations as may be deduced from the document.
SIR DAVID MAXWELL-FYFE (Deputy Chief Prosecutor for the United Kingdom): Your Honor, I would be grateful if the Tribunal would consider a general point of procedure. We have a number of objections to a considerable number of Dr. Kranzbühler’s documents. I have got out a short list grouping, as far as is possible, our objections, which I can hand to the Tribunal and, of course, to Dr. Kranzbühler, now. It is a matter for consideration by the Tribunal whether it would be useful to see that list before the Tribunal adjourns tonight, and maybe here tender certain observations of Dr. Kranzbühler upon them. Then the Tribunal might be able to give a decision with regard to certain of the documents before sitting again tomorrow and thereby save some time. I suggest that to the Tribunal for their consideration as perhaps the most profitable procedure under the circumstances.
THE PRESIDENT: Are you suggesting that at a certain point of time we should adjourn for the consideration of your list and then hear Dr. Kranzbühler on it?
SIR DAVID MAXWELL-FYFE: Yes.
THE PRESIDENT: That is what you suggest?
SIR DAVID MAXWELL-FYFE: Yes, Sir. I was going to explain my list, put my list to the Tribunal, and explain it; and then the Tribunal could hear Dr. Kranzbühler upon it and adjourn at whatever time it is suitable.
FLOTTENRICHTER KRANZBÜHLER: May I make a statement in that regard, Mr. President?
THE PRESIDENT: Certainly.
FLOTTENRICHTER KRANZBÜHLER: I do not agree with such a proceeding, Mr. President. Before this Tribunal I have said very little as defense counsel so far; but I am of the opinion that it is my turn now and that I have to be granted permission to submit my documents in that order in which I plan to and which I consider correct for my defense.
I ask the Tribunal just to imagine what would have happened if, before the presentation of their case by the Prosecution, I had said that I should like to speak about the relevancy of the documents of the Prosecution. I believe that this comparison shows that I should not have thought of proceeding in this way. I shall try, before submitting my documents, to explain their relevancy to a greater extent than I have thought necessary until now. But I ask the Tribunal to grant that I present my case now and to limit the Prosecution to making their suggestions when I submit my documents individually.
SIR DAVID MAXWELL-FYFE: The inconvenience of that course, My Lord, is that I shall then be interrupting Dr. Kranzbühler every two or three documents and making a specific objection to an individual document, which will take a great deal of time. I thought it would be more convenient if I indicated to the Tribunal my objections to the documents in the usual way by classes rather than individually.
I put it to the Tribunal to rule on whatever method they think would be most convenient for them. The last thing I want is to interfere with Dr. Kranzbühler’s presentation; but, on the other hand, the method that he suggests will mean individual objections, because, of course, an objection is useless if it is put in after Dr. Kranzbühler has developed the document. Or, if it is not useless, it is at any rate of very much less weight.
THE PRESIDENT: Dr. Kranzbühler, supposing that Sir David presents his objections to the documents now, whether in groups or in whatever way he likes, and you then answer him individually upon each document, pointing out the relevance in your view of each document; how does it harm you? The Tribunal will then consider your arguments and will rule upon them, and then you will know what documents the Tribunal has ruled out, and you can then refer to any of the other documents in any way you please.
The only object of it and the only effect of it is to prevent the Prosecution’s having to get up and interrupt, put on the earphones, and take the time for an individual objection to each document to which they wish to object as it turns up. I cannot see that it can interfere with you in the least.
FLOTTENRICHTER KRANZBÜHLER: Mr. President, I have no objection to the Prosecution’s stating their objections now. I merely wish to avoid my having to reply to each individual objection. If I am permitted to state my views when each individual document comes up, then I have no objection to the Prosecution’s stating their objections now to individual documents.
THE PRESIDENT: Sir David, the Tribunal would like you to state now your objections to these documents. They will then allow Dr. Kranzbühler to proceed with his discussion of the documents, answering your argument as to the admissibility of each document that you object to when he comes to it.
SIR DAVID MAXWELL-FYFE: If Your Lordship please. Will Your Lordship just allow me a moment to get my papers? I am afraid I have only the Prosecution’s objections in English, but it may help those of the Tribunal who do not understand English to have the numbers, at any rate, in front of them.
My Lord, the first group are documents which the Prosecution submits have no probative value. These are D-53. My Lord, the “D” in this case stands for Dönitz Document Book 53, Page 99; and D-49, Pages 130 and 131; D-51 and D-69.
My Lord, the first of these, D-53, is a letter from a prisoner-of-war camp, purporting to be signed by 67 U-boat commanders and in purely general terms. The Prosecution submits that that is not helpful, either from its form or from its material.
My Lord, D-49, which is at Pages 130 to 131, is again in entirely general terms and contains no indication of the moral or legal basis for the opinion expressed.
D-51 and D-69 are both newspaper reports.
THE PRESIDENT: Wait a minute, Sir David. 130? I have not got a Page 131. Is it an affidavit, or was it called an affidavit?
SIR DAVID MAXWELL-FYFE: Yes, My Lord.
THE PRESIDENT: “On the basis of the documents of the Navy Court archives at...”
Oh yes, I think the Document Book has got a bit out of order.
SIR DAVID MAXWELL-FYFE: Yes, My Lord, maybe so.
THE PRESIDENT: Is it a sworn affidavit by somebody or other?
SIR DAVID MAXWELL-FYFE: Yes, My Lord. 130 comes immediately before.
THE PRESIDENT: I have got it now, yes, 131 comes somewhere before 130.
SIR DAVID MAXWELL-FYFE: That is it, My Lord. It is an affidavit by a former fleet judge, and Your Lordship sees that the description which the Prosecution gives of it as being in entirely general terms is, I submit, justified by the wording of the document, and it is difficult to see the basis which the learned opponent seems to profess for his statements.
My Lord, D-51, Page 134, is an extract from the Völkischer Beobachter of March 1945, and the Prosecution submits that the topic on which it is is irrelevant to the matters developed against the Defendant Dönitz. Number 69 is another newspaper report from the same paper of 14 November 1939, giving a list of armed British and French passenger ships. Now, My Lord, the second group which we developed are those irrelevant documents, D-5, D-9, D-10, D-12, D-13, D-29, D-48, D-60, D-74.
Now, My Lord, the first of these, D-5, on the subject of Norway, seeks to introduce by way of a footnote a summary of the documents which the Tribunal dealt with when considering the documents in the case of the Defendant Raeder, with regard to which the Tribunal expressed its doubts, although it allowed them to be translated. The Tribunal will remember that with regard to the Dönitz documents it was thought convenient to have them translated without a preliminary argument. Now, My Lord, the same argument applies to a footnote, to a speech of the Defendant Von Ribbentrop, a summary of documents which came into German possession long after the speech of the Defendant Ribbentrop was made. The Prosecution submits it is irrelevant.
And the documents 9, 10, 12, and 13 deal with the rescue of Allied survivors in the years 1939 to 1941 inclusive.
THE PRESIDENT: Oh, yes.
SIR DAVID MAXWELL-FYFE: My Lord, that last statement, “and all apparently unsworn,” is an error. It ought to be that D-13 is apparently unsworn.
Now, My Lord, with regard to that the position is that whereas it is quite true that a nonrescue order was issued by the defendant before 27 May 1940, the really important period is round about 17 September 1942. It seemed to the Prosecution unnecessary to go into these details for the earlier period. There is no real doubt that there were some rescues. The only point which the Prosecution is putting against the defendant is that he did issue an order, which the Prosecution has proved, forbidding rescue when there was any danger.
THE PRESIDENT: What was the date you gave us, 17 November 1942?
SIR DAVID MAXWELL-FYFE: My Lord, the nonrescue order is before 27 May 1940. We cannot give the exact date, but we know from a reference in another order that it must have been before 27 May 1940. And the order with regard to the destruction of the crews of merchant ships is 17 September 1942.
Now, My Lord, the Document Number 29 contains four documents dealing with the evidence of the witness Heisig. The first purports to be an affidavit by a witness who speaks to the sort of statements the Defendant Dönitz usually made and does not remember what was said on the particular occasion referred to by the witness Heisig; and it contains a good deal of argument.
The second is a letter sent to counsel for the Defendant Dönitz, and, with the exception of one sentence, denying that the defendant spoke in the sense alleged by Heisig; the remainder of the statement which, of course, is unsworn, is either argument or is vague or irrelevant. The remaining two documents, both apparently unsworn, contain allegations against the character of the witness Heisig. The Tribunal will remember that no allegations were made against him; that there was no cross-examination in regard to his character when he gave his evidence. And the second deals with other lectures which are not those in question.
Now, My Lord, the next document, D-48, deals with the alleged good treatment of Allied prisoners in German Naval prisoner-of-war camps, on which subject no issue has been raised with this defendant. D-60, Page 209 deals with Italian- and French-declared danger zones, which, the Prosecution submits, has no relevance to those declared by the Germans. D-74 and D-60, Page 256, deal with the relationship between the British and French merchant marines and their respective navies; and the Prosecution submits that they are irrelevant as far as the British Navy is concerned, if they have any relevance cumulative of D-67.
Now, My Lord, the third group are details of the Contraband Control System and they are D-60, Pages 173 to 198; D-72; D-60, Pages 204 and 205 and Pages 219 to 225. My Lord, these documents deal with the details of the contraband control, what articles were contraband, declarations of different governments; and it is submitted that details of the contraband control are remote from the issues raised and entirely irrelevant. I do not think in the presentation against either of the Naval defendants questions of declarations of contraband were mentioned at all, certainly not in regard to the Defendant Dönitz; and, in the submission of the Prosecution, it’s really introducing matters which are, I am sure, not helpful to the problems of this case.
The fourth group, which can only be described in very general terms, are allegations against the Allies. My Lord, the general objection I set out in the first paragraph is this: Those documents consist of various allegations against the Allies; they appear to have little or no relevance to the issues and, if submitted, might necessitate the Prosecution’s seeking the facilities to rebut the allegations; in which case a large volume of evidence in rebuttal might be entailed.
Then I have isolated those which deal with allegations that the Allies did not pick up survivors; there are two: 43, 67; Pages 96 and 90. 31 and 32 deal with Allied attacks on German air-sea rescue planes; 33 accuses a Soviet submarine of sinking a hospital ship.
And three, Numbers 37, 38, and 40, the last being a newspaper report, allege that the Allies shot survivors. My Lord, the question of Allied treatment of survivors is dealt with exhaustively by extract from the German Naval Diary and, My Lord, that we are not objecting to because there it is important not as evidence of the facts stated but as evidence of the matters that had an effect on the German Naval Command. For that purpose I am quite ready that Dr. Kranzbühler should put them in and the Tribunal should consider them. And there is another document which deals with that point quite fully, and I am quite prepared to let that go in.
Then, My Lord, the remainder allege either ruthless actions or breaches of International Law by the Allies; and these are Number 19, Page 24, the Göring exhibit; Numbers 7 and C-21, Page 91; 47, Pages 120, 121, which is also a newspaper report; 52, 60, Pages 152 and 208; D-75, 81, 82, 85, and 89.
Now, as I understand the defense that is developed here—the allegation with regard to the order which we say sets out the destruction of survivors—it is not that it was a reprisal, but the defense is that the order did not mean destruction but merely meant nonrescue. On that basis it seems difficult, indeed impossible, to appreciate how these matters become relevant at all.
And similarly with regard to the order for shooting Commandos. The justification alleged for the order is set out in the order itself. I haven’t heard any defendant develop any justification of that order in giving evidence before the Tribunal. Every one of the defendants so far has said this order was given by Hitler and “whether we approved of it or not we had to carry it out.”