The Ambassador in Germany (Dodd) to the Secretary of State

No. 3120

Sir: Referring to the Embassy’s telegram No. 313 of October 24, 1 p.m.,33 I have the honor to transmit a translation of a communiqué issued by the Deutsches Nachrichtenburo under date of October 23, 1936,33 which incorporates the most important parts of the decree of’ the same date concerning the execution of the Four Year Plan. This decree is issued by Goering in his new capacity of “Commissioner for the Four Year Plan” and establishes the broad outlines of the organization through which the execution of this policy is contemplated.

It will be observed that Dr. Keppler, former special adviser to Hitler on economic matters, will be charged with the planning and carrying out of the manufacture of industrial fats and in addition will act as personal adviser to Goering on questions relating to the production of German raw materials. As has been pointed out in recent telegrams, [Page 157] Dr. Keppler is generally considered to represent the views of left-wing Party economists who favor the promotion of German economic autarchy at all costs and who are believed to have induced Hitler to bring forth this policy at Nuremberg, probably without prior consultation with Dr. Schacht. The latter, it will be noted, is not mentioned in the decree but as “financial matters” and the “distribution of raw materials” will be handled in collaboration with Reich Ministry of Economics, it is reasonable to assume that adequate provision has thereby been made to receive the views of Dr. Schacht. That these views, particularly as they may relate to the necessity of foreign trade for Germany, will not entirely coincide with Dr. Keppler’s is a foregone conclusion. Consequently, it is generally expected in Berlin that a conflict between these two personalities will sooner or later ensue over the development of the Four Year Plan, particularly in such fields where increased costs may lead to diminishing exports.

In this connection it is interesting to note that the section entitled “Production of German Raw Materials and Producers’ Goods” will be under the direction of an army officer, Lt. Colonel Loeb of the General Staff. In many respects this can be considered to be the most important section of the new organization and that it should be entrusted to [a] military official is witness to the interest which the Army is taking in this policy. On the other hand, Dr. Schacht through his policy has been able to provide the necessary raw materials for the rearmament program and is generally considered to enjoy the confidence and support of the War Ministry. It may well be that in the execution of this program the Army will act as a balance-wheel between conflicting viewpoints. As a general policy, it would no doubt favor making Germany as completely self-sufficient as possible or more particularly to provide the equipment for possible self-sufficiency in time of war. However, in face of the many natural difficulties involved in this undertaking, it is not to be assumed that the Army is now prepared to scrap Schacht’s policy which has provided it with the necessary material in favor of a plan whose immediate and complete success is by no means assured. Therefore, its position is seen to be a middle one.

Finally, it will be noted from the decree that new departments will only be established where absolutely necessary. This is taken to mean that there will be no new and elaborate organization set up which will be dominated by Party officials determined to push the program through at any cost. Also, by the same token, Dr. Schacht, through the Reichsbank and the Ministry of Economics, will continue his influential role in the formulation of German economic policy. This opinion, that Schacht’s prestige and influence have not been diminished by recent events, is freely expressed by many well-informed persons [Page 158] in Berlin who also believe that the transfer of Keppler and his subordination to Goering will eventually serve to strengthen the influence of the Reichsbank President.

Respectfully yours,

William E. Dodd
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