862.00/3552
The Consul General at Berlin (Jenkins) to the Secretary of State
[Received November 15.]
Sir: I have now been in Berlin a year and have had some opportunity to observe the trend of political and economic developments. It seems to me that the situation existing today contrasts sharply in many respects with conditions a year ago, and for this reason the following outline of more important events during the year may be of interest to the Department.
When I arrived in Berlin last October the June 30th “blood purge” was fresh in the minds of the people and there seemed to me to be a general feeling of uncertainty and anxiety. It was generally understood that the Reichswehr stood somewhat aside from the Government and Party, and well-informed people feared an armed clash between the Reichswehr and the S. S. and remnants of the S. A. Rumors were persistently circulated to this effect and the possibility of another blood purge was suggested although nobody seemed to know exactly against whom it would be directed.
[Page 290]Up to that time Mr. Hitler had made no specific declaration of foreign policy. He was thought to be inexperienced in government and there was wide-spread anxiety amongst the German people as to the conduct of foreign affairs. I got the impression that Mr. Hitler’s prestige as the head of the State was low, especially amongst thoughtful, well-informed people.
The uncertainty of the economic situation also added to the feeling of unrest. There was evidence of a serious potato shortage and the people generally feared that imported necessities would become increasingly scarce during the winter because of Dr. Schacht’s stringent import regulations. Added to all these difficuties was the possibility of inflation. Many bankers and business men admitted privately that the economic situation was growing acute and expressed the opinion that Dr. Schacht’s plan to maintain the mark at par by drastic reduction of imports could not last through the winter. The German cotton mills were unable to obtain raw cotton from the United States because of the exchange situation, and it was also predicted that a shortage of petroleum products was imminent for the same reason.
The situation continued without improvement through December when the overwhelmingly favorable vote in the Saar in January seemed to put renewed life into the Party and the German people began to realize they had gotten through the winter without any really serious shortage of foodstuffs and other essentials. At the same time there had been no decline in the value of the mark and pessimistic bankers and business people had to admit Dr. Schacht would probably be able to carry on through the coming summer.
Toward the end of January Mr. Hitler suddenly called a meeting of leading Army officers and National-Socialist officials to take place in the Opera House in Berlin. Many of the officials were summoned by telegraph and could only reach the meeting by using airplanes. The greatest secrecy was maintained and to this day it is not generally known what actually took place in the Opera House. However, subsequent events seem to confirm the fact that a reconciliation was effected between the Army and the Party. It is believed that Mr. Hitler made it clear that the Army alone would be responsible for the defence of the Fatherland and that the S. S. and S. A. must abandon any thought of sharing this responsibility with the professional soldiers.
There were reports, probably well founded, that the Army was reassured in respect to the murder of General von Schleicher and his wife during the June 30th blood purge. In return for these considerations the Army is believed to have promised Mr. Hitler and the National-Socialists its complete support. From the Opera House meeting onward a marked change has been evident to all, even foreigners. [Page 291] The old spirit of the Army began to show itself again in the attitude of the officers. In spite of Party opposition the process of disbanding the S. A. was actively resumed and in a few weeks the brown uniforms almost disappeared from the streets of Berlin. Reports began to come in of wide-spread activity in the construction of airdromes and barracks and also in the reorganization of factories for the production of military supplies. It was evident that the German army was being enlarged and that an air force was in process of rapid creation.
These activities were the cause of grave concern to other European powers, but it was evident to even the casual observer that the German people were delighted with the new trend of events. In fact, the conservative groups felt that Mr. Hitler and the National-Socialists had actually turned to the right. However, subsequent events proved this assumption was erroneous.
Ground having been well prepared for it by that time, Mr. Hitler on March 17th made his famous declaration of the determination of the German Government to resume general compulsory military service and re-establish the Army. He added that from then on Germany’s honor would depend on her own might, and repudiated the military clauses in the League of Nations Treaty. This declaration met with the instant and wide-spread approval in Germany although some feared it might lead to war. The declaration added to Mr. Hitler’s growing prestige and popularity.
Two days later (on March 19th) Berlin went through a sham airplane attack, when all lights were put out and the German Government let it be known officially for the first time that it possessed military planes and intended to build a great many more. Hundreds of men in the new blue-gray uniform of the air force appeared in the streets, while a still further reduction in the number of S. S. and S. A. uniforms was observed.
On March 20th, the Reichstag assembled in Berlin at Mr. Hitler’s call to hear his speech on foreign relations. Although there was relatively little new in this speech, it afforded Mr. Hitler an opportunity to declare again the desire of the National-Socialist Government for peace with France and other powers, and to keep German armed forces out of the non-military zone on the French border and to avoid acts of aggression against the territory of neighboring states. Mr. Hitler’s earnestness and frankness made a deep impression on the Germans and foreigners alike, and added still more to his prestige in this country.
The naval agreement with Great Britain followed soon after, together with an announcement by the German Government of its plans for the building of a new fleet.
[Page 292]Mr. Hitler’s popularity and his evident determination to maintain peace with the outside world and encourage Dr. Schacht in his efforts to develop German industry and trade, led the conservatives to believe, as I have already mentioned, that Mr. Hitler had definitely allied himself with the right wing of the Party and could be relied upon in future to take the side of the industrial and commercial interests as against the more radical elements in the National-Socialist administration. The lull in the anti-Jewish movement appeared to confirm this opinion and many Jews were inclined to believe that the worst was over for them and that they could expect a gradual return to normal conditions.
However, this was all swept away with the anti-Jewish rioting in July. From this point on the Fuehrer began to show that he was by no means committed to the conservative point of view but on the contrary was inclined to stick by old Party members in their fight against the Jews. Admiral von Levetzow, the relatively moderate head of the Police Department in Berlin, was summarily removed from office, and Count von Helldorf was appointed in his stead. The latter is known as a radical with pronounced anti-Jewish tendencies. Dr. Goebbels, of the Propaganda Ministry, resumed his anti-Jewish attacks and at the same time turned his attention to the conservative elements, including old line Government officials whom he denounced as bureaucrats lacking in patriotism. Anti-Jewish activities increased all over the country.
Dr. Schacht saw the danger of this to business and industry and tried to stem the tide by a bold attack on the radicals in a speech he made at Koenigsberg in mid-summer. It was also reliably reported that he appealed directly to the Fuehrer to check the anti-Jewish trend. Dr. Goebbels, Dr. Schacht’s old enemy, retaliated by forbidding the newspapers to publish the more important sections of Dr. Schacht’s speech, and the latter was forced to distribute it privately through the Reichsbank and other agencies under his control.
In September, occurred the annual meeting of the National-Socialist Party at Nuremberg when Mr. Hitler took advantage of the occasion to call a meeting of the Reichstag to ratify still more stringent anti-Jewish laws. Although these laws have not yet been implemented by administrative regulations, they are everywhere being enforced by the Party against Jews and Jewish business concerns. The spirit of the Jewish people has been broken and they are now convinced that there will be no toleration for them in Germany as long as the National-Socialist Party remains in power.
When I came to Berlin, foreigners and many Germans still clung to the idea that the National-Socialist Party could not endure, and [Page 293] predicted the early collapse of the Hitler Government. I think I can say that few people entertain this thought today. The consensus of well-informed opinion now is that Mr. Hitler and the Nazi regime are firmly established. It is true many people are not in sympathy with the regime and would like to see it fail, but they can no longer predict its collapse. The Party as such is probably not as popular as it was last spring. The scarcity of fats and other necessities has caused widespread discontent amongst certain classes of the people, but there is little inclination to attach any blame to Mr. Hitler personally. Dr. Goebbels and other leaders have adroitly impressed upon people the idea that the shortage is due to the gigantic efforts of the Government to re-arm Germany and that the Germans must stand fast under their well-known discipline until the Fatherland is again re-armed and powerful.
A year ago many people were inclined to the opinion that the Army might some day turn against the Nazis through the influence of its conservative leaders, but no one is rash enough to suggest this now for it is realized that the Army has also undergone great changes in the past year. It is doubtful if the older officers are the unit for conservatism they once were, and many of the younger officers are definitely favorable to the National-Socialist regime. When Mr. Hitler made peace with the Army in the Opera House meeting he established himself firmly in control of the Government although he may have lost some popularity with the predominantly radical elements in his Party. Now that the Army has been won over he is again turning his attention to the Party. The Party is definitely anti-Jewish, and the Nuremberg laws and Mr. Hitler’s refusal to interfere to any extent with the Party’s anti-Jewish activities seem clearly intended to win back and consolidate Party support.
It seems to me that a fair summary of the situation in Germany today as compared with a year ago may be expressed somewhat as follows:
- 1)
- Mr. Hitler is now on good terms with the Army, which is receiving every possible consideration from the Government and in return can be expected to render loyal and full support to Mr. Hitler as its Commander-in-Chief. Mr. Hitler’s foreign policy is approved by the mass of the German people and has added to his prestige. At the same time the German people appreciate Mr. Hitler’s earnestness and undoubted patriotism.
- 2)
- The revival of extreme anti-Semitism is not popular in business circles, but since the Nuremberg meeting it has become evident that the anti-Jewish movement is deep-rooted in the National-Socialist Party and is now to be carried out without further delay or modification. The Jewish people in Germany recognize this and are preparing as best they can to meet the situation. The struggle between the Government and the churches seems to be approaching some sort of compromise or modus vivendi.
- 3)
- The shortage of fats and other necessities will continue to embarrass the Government and there may be some disturbances this winter but no serious disorders are anticipated.
- 4)
- Dr. Schacht’s stringent exchange and trade regulations are becoming more and more difficult of enforcement and modifications will probably be unavoidable in the relatively near future. However, the best informed opinion seems to be that Dr. Schacht has not yet reached the end of his resources and that no fundamental changes should be anticipated in the immediate future.
Respectfully yours,