Hitler and His Secret Partners: Contributions, Loot and Reward, 1933-1945

This is the full story of the financial calculation, exploitation, and greed at the core of the Third Reich, and of an amassed legacy that continues to make headlines with the recent emergence of Nazi accounts in Swiss banks.

Chapter 1: Financing the 1933 Elections
On the cold winter weekend of January 28, 1933, Germany was officially without a government. Chancellor Kurt von Schleicher and his cabinet had resigned on Saturday afternoon, and eighty-six-year-old President von Hindenburg had not yet appointed a new chancellor. A nervous tension spread over Berlin. Everyone waited for news; most felt Germany was at an historic turning point.
Who would be the next chancellor? Hitler -- the leader of the largest party, the Nazis, who pledged to destroy democracy? Papen -- the aristocratic horseman who had been chancellor before Schleicher, but who had no popular following? Perhaps Schleicher again, if he could persuade the Social Democrats, the second largest political party in the country, to join him in a coalition? Governing Germany in the middle of an economic depression with nine million unemployed was not an enviable task. The country had just had three different chancellors in rapid succession. By tradition, the leader of the largest party was usually appointed chancellor. But the Nazis had been the largest party for over a year, and so far intrigues and political maneuvering had succeeded in keeping Hitler out of power. Everyone guessed what a Hitler government would mean. He had not kept his militarism, anti-Semitism, and dictatorial ambitions a secret.
Political intrigues were so numerous that weekend that no one really knew what was going on. Sensational rumors were being spread throughout the city. Some said an army coup was imminent, that Schleicher and the generals were about to abduct President von Hindenburg and declare martial law. There were also rumors of an armed Nazi uprising and a general strike by the socialist workers.
Hitler and Hermann Goering, the second most powerful man in the Nazi party, stayed up all night on Sunday, January 29, trying to figure out what Hindenburg might do. It was not until after 10 A.M. on Monday that Hitler received a summons to the president's office. Even at that point, the Nazis were not certain whether Hitler would be appointed chancellor or Hindenburg would ask him to serve as vice-chancellor.
Across the street from the Chancellery, in the Kaiserhof Hotel, Hitler's lieutenants were waiting, unsure of what was going on. Goebbels, the Nazi propaganda chief, said:
In the street the crowd stands waiting between the Kaiserhof and the Chancellery. We are torn between doubt, hope, joy and despair. We have been deceived too often to be able, wholeheartedly, to believe in the great miracle. [S.A.] Chief of Staff Roehm stands at the window (with binoculars) watching the door of the Chancellery from which the Fuehrer [the leader, Hitler] must emerge. We shall be able to judge by his face if the interview was a success. Torturing hours of waiting. At last, a car draws up in front of the entrance. The crowd cheers. They seem to feel that a great change is taking place....
A few moments later, he is with us. He says nothing. His eyes are full of tears. It has come! The Fuehrer is appointed Chancellor. He has already been sworn in by the President of the Reich. All of us are dumb with emotion. Everyone clasps the Fuehrer's hand....Outside the Kaiserhof, the masses are in a wild uproar....The thousands soon become tens of thousands. Endless streams of people flood the Wilhelmstrasse. We set to work...at once.
Hitler's victory was not a complete one by any means. He had been appointed chancellor in a coalition government. Papen was to be his vice-chancellor, and all the powerful cabinet posts were held by Papen's conservative allies, rather than the Nazis. But at the moment, Hitler's followers weren't worried about the details; for them the only thing that mattered was that Hitler was chancellor. They had come to power! All day, crowds gathered in the square outside the Kaiserhof Hotel and the Chancellery.
At dusk Nazi storm troopers in their brown uniforms gathered in the Tiergarten park, along with men of the Stahlhelm, an ultranationalistic veterans' organization, for a torchlight victory parade through the center of Berlin. As soon as it was dark, they came marching by the thousands through the Brandenburg Gate, carrying swastika flags and the black, white, and red flags of the German empire. Bands marched between the units, beating their big drums as the men sang old German military songs. But as each band came to the Pariser Platz, where the French embassy was located, they stopped whatever they were playing and, with an introductory roll of drums, broke into the tune of the challenging war song "Victorious We Will Crush the French."
The torches carried by the marchers glowed hypnotically in the darkness. To foreign witnesses, it was a frightening sight. "The river of fire flowed past the French Embassy," Ambassador François-Poncet wrote, "whence, with heavy heart and filled with foreboding, I watched this luminous wake." Liberal Germans found it an "ominous sight." It was, wrote one German reporter, "a night of deadly menace, a nightmare in...blazing torches."
As the marchers came by the Chancellery, there were tumultuous cheers for Hitler, who stood in an open window saluting them. He was so excited that night, he could hardly stand still. He was raising his arm up and down heiling, smiling, and laughing so much, his eyes filled with tears. "It was an extraordinary experience," recalled Papen, who was standing behind Hitler. "The endless repetition of the triumphal cry: 'Heil, Heil, Sieg Heil!' rang in my ears like a tocsin." When Hitler turned to speak with Papen, his voice choked with emotion. "What an immense task we have set for ourselves, Herr von Papen -- we must never part until our work is accomplished." Hitler and Papen were much closer allies than anyone at the time imagined.
It was after midnight when the parade ended. Being too excited to sleep, Hitler, Goering, Goebbels, and a few other Nazis sat up talking for hours. They could hardly believe it had actually happened: they were in the Chancellery at last. That evening, Hitler said to Goebbels, "No one gets me out of here alive." It was one of the few promises he kept.
On the morning of January 31, Hitler's storm troopers gave the German people a glimpse of what Nazi rule would be like. All over Germany, thugs in brown shirts took possession of the streets and roughed up Communists, socialists, and Jews; they chased socialist mayors and officials out of government buildings and even broke into the private homes of their political enemies. When people complained to Papen, he laughed. "Let the storm troopers have their fling." Among his friends at the Herrenklub, an exclusive gentlemens club, he boasted: "We've hired Hitler." To a skeptic he replied: "What do you want? I have Hindenburg's confidence. Within two months we will have pushed Hitler so far in the corner that he'll squeak."
The facts seemed to support Papen's optimism. Not only did Papen have Hindenburg"s confidence, but in fact the old president had promised never to receive Hitler unless he was accompanied by his vice-chancellor. Papen also held the important post of minister-president of Prussia, Germany's largest and most powerful state. From the composition of the cabinet, it seemed all the real power was in the hands of the conservatives: the aristocratic General von Blomberg was minister of defense, Baron von Neurath, a career diplomat, was foreign minister, and the old archreactionary Hugenberg was both minister of economics and minister of agriculture. The Nazis were outnumbered six to two.
The two Nazis in the cabinet, Wilhelm Frick and Goering, held posts that were thought to be insignificant. Frick was minister of the interior, but he did not control the police, which in Germany was under the jurisdiction of the individual state governments. Goering was made minister without portfolio, but with the promise that he would be minister of aviation as soon as Germany had an air force. He was also named minister of the interior of Prussia, an office that did not receive much notice by the public but did control the Prussian police.
The aristocrats and gentlemen of the Right who made up the majority of Hitler's cabinet hated the concept of democracy even more than the Nazis did. These men belonged to the old ruling class of the kaiser's Germany. They wanted to regain their old position of supremacy, lost in 1918. They wanted to restore the monarchy, suppress the socialist unions, avenge the loss of World War I, and make Germany the dominant power in Europe. It was obvious why such reactionary nationalists helped put Hitler in power: their goals and his were very similar.
Few people knew the full extent of Papen's collaboration with Hitler. Historians have said he "did more than anyone else outside the Nazi party to help Hitler to power." Papen helped Hitler because he was trying to control him and use the Nazis for his own aims.
Papen was a handsome aristocratic-looking man with distinguished gray hair and an officer's mustache. From an impoverished family of the Westphalian nobility, he became a General Staff officer, a skillful horseman, and a man of great charm. After a successful marriage to the daughter of a wealthy Saar industrialist, he bought a large block of shares in the Center party's newspaper, Germania. For a short time in 1932, Papen was chancellor, but his government had no popular support. Papen believed it would be rather easy for an aristocratic officer like himself to manipulate a former corporal, like Hitler, and thus be able to use the Nazi's mass following to accomplish the aims of the upper-class conservative nationalists.
Hitler immediately began to outmaneuver his conservative colleagues. He reported to the cabinet that the Center party was making impossible demands and could not be counted on to form a coalition with the Nazis and the Nationalists that would have a majority in the Reichstag. Because of this situation, Hitler argued he would have to call for new elections. The only "demand" the Center party made was that Hitler promise to govern constitutionally, but none of the other members of the cabinet bothered to check Hitler's statement. They agreed to new elections on the condition that Hitler promise that the composition of the cabinet would not change regardless of the outcome of the voting.
New elections would provide Hitler with a chance to improve on the poor results the Nazis had received at the polls the past November. If the Nazis won a clear majority in the elections, they might be able to get rid of their coalition partners. Hitler had every reason to believe the election campaign would be a big success. The entire machinery of government, including the radio, was now under Nazi control and could be used for campaigning. The party had been flooded with new applicants for membership since he had become chancellor. In the cabinet meeting on February 2, Hitler discussed his preparations for the elections. Wilhelm Frick, the Nazi minister of the interior, proposed that the government set aside a million marks for the election campaign. Count von Schwerin von Krosigk, the minister of finance, rejected this suggestion. Hitler did not force the issue. He would have to get the money elsewhere.
The theme of the Nazi election campaign was to be the fight against communism. Hitler opened the attack in a late-night radio broadcast to the nation on February 1. He blamed the hard times Germany had gone through since 1918 on the Social Democrats, which had been the largest party in the Reichstag during most of those years. The Social Democrats, he reminded his listeners, were actually a Marxist party. "Fourteen years of Marxism," he said, "have ruined Germany; one year of bolshevism [communism] would destroy her. The richest and fairest territories of the world would be turned into a smoking heap of ruins. Even the sufferings of the last decade and a half could not be compared to the misery of a Europe in the heart of which the red flag of destruction has been hoisted." He went on to promise to put the unemployed back to work and save the peasants from bankruptcy.

On his fourth day in office, just after opening the election campaign, Hitler took time off to attend a very important dinner. He had been invited to the home of General von Hammerstein, chief of staff of the army, to meet the leading officers of the army and navy. In a speech that lasted almost two hours, Hitler explained his plans for rebuilding German military power.
The generals were the real power in Germany during the Weimar period. After World War II, many Germans tried to cover up the role certain members of the Officer Corps had played in helping to put Hitler in power. Many historians naively accepted this view, but the real story is quite different. Traditionally, the German Army ruled from behind the scenes and had the final "power to veto" any important issue. After the loss of World War I, the Versailles Treaty severely restricted the size of the German Army. The only way the generals could maintain mass training and develop new weapons was to finance private paramilitary units, like the Free Corps, with secret army funds.
Hitler not only began his career as an army agent, but even in the 1930s he was supported by a powerful faction in the army. Over several years, General von Schleicher, who was in charge of a secret informal political department of the army, funneled over ten million marks to Hitler. Why? Many military officers wanted an authoritarian government that could unify the nation. The people needed to be infused with a new spirit of patriotism because powerful interests were planning a war of revenge against the Allies. Naturally there was a division of opinion among the generals as to how much power to give Hitler.
Hindenburg originally had strong reservations about appointing a man from a lower-class background, like Hitler, chancellor. However, the aggressive action the Nazis took against Communists was admired by Hindenburg, and his relationship with Hitler rapidly improved.
One day, Hindenburg summoned Hitler when Papen was away from Berlin. Hitler informed the president that Papen was out of town and reminded him of the rule he (Hindenburg) had made, that the chancellor could visit him only when accompanied by the vice-chancellor. "The old gentleman [Hindenburg]," said Hitler, "replied that he wished to see me alone, and that in the future the presence of Papen could be regarded as unnecessary. Within three weeks, he had progressed so far that his attitude towards me became affectionate and paternal. Talking of the elections fixed for the 3rd of March, he said, 'What are we going to do if you fail to get a majority? We shall have the same difficulties all over again.'"
At the beginning of the election campaign, Hitler and Papen persuaded old President von Hindenburg to sign an emergency decree to protect law and order. The decree gave Nazi officials the right to prohibit public meetings. Newspapers could be suppressed if they "incited" civil disobedience or published "false" reports. The decree gave Hitler and Papen a very useful weapon in the election campaign.
There was certainly plenty of election violence. The Nazi storm troopers invaded the beer halls and bars where the Communists and Social Democrats held their meetings. There were fistfights and bloody street brawls with clubs and razor blades. During the election campaign, from January 30 to March 5, over seventy people were killed in political violence.
Where the use of violence was involved, Hermann Goering was the expert. Thus he played a decisive role in the first year of Hitler's government. Without Goering's drive and ruthlessness, Hitler might never have been able to transform his position as chancellor to that of dictator.
During the war, Goering had b...