Worse still, the Third Reich was not merely losing America, it was losing German America.79 The president of the Deutschen Ausland-Instituts, Dr Strolin, reported on his return from a lengthy trip to the United States that the vast majority of German-Americans, even including those who attended cultural events, were no friends of the new Germany. This was the result partly of the ‘dominating influence of the Jews’ in places like New York, he claimed, but also of the more or less universal US antipathy to ‘militarism’, the suppression of press freedoms and the generally ‘different world view’ of Americans, including German-Americans.80 In May 1937, the Third Reich was reminded of this breach when Cardinal Mundelein of Chicago, whose father was of German descent, took time out from attacking Hollywood filth and extramarital sex to lambast Hitler, particularly his treatment of the Catholic Church there; German diplomatic protests proved to be of no avail.
The Führer’s relations with most other powers remained reasonably good throughout most of 1937. This was partly due to the fact that Hitler continued to tread carefully in the matter of German minority rights, and the role of German citizens abroad. He distinguished carefully between Volksdeutsche, whom he defined as those of German descent, but citizens of another state, and Auslandsdeutsche, citizens of the Reich residing in foreign parts who were under the umbrella of the Auslandsorganization.81 Relations with Poland remained particularly warm, at least at the diplomatic level. When a special four-volume edition of the late Marshal Piłsudski’s orders and speeches appeared in early 1937, the list of subscribers was headed by the Polish president, the marshal’s widow and Hitler.82 In May 1937, he instructed Ribbentrop ‘that the overall Polish-German relationship should not be exposed to serious strain on account of minority questions’.83 To be sure, Hitler was critical of Poland in private. ‘With Poland [there is] no love-match,’ he had told Goebbels, ‘but a relationship based on reason [which] has enabled our rearmament’.84 Even so, there is no evidence that Hitler was planning an attack on Poland either at the time or in the future.
Hitler sought to rally Europe, or at least the authoritarian states, behind him by casting himself as a bulwark against the Soviet Union. He repeatedly played the Bolshevik card in his discussions with Hungary, Romania and other powers, urging them to patch up their differences, a strategy which continued until 1945.85 Despite this rhetoric, there is no evidence that after a brief moment of anxiety in 1936 Hitler privately considered the Soviet Union an imminent military threat at this point. Outside of Spain, therefore, the struggle was waged on the ideological and propagandistic plane. This is why Hitler emphasized the importance of the Paris International Exhibition in the summer of 1937, which he saw as an opportunity to showcase the attractions of National Socialism to a world audience, especially Europeans.86 He took a keen interest in the German pavilion, which was co-designed by Speer. Hitler’s aesthetic priorities became clear when he rejected the request of the Economics Ministry to send representatives to those discussions.87 Speer was aware of the Soviet designs when he was drawing up his own, and the intensity of the competition was surely heightened by the fact that his rival was a Jew from Odessa.88 In the end, the Soviet and the Nazi pavilions directly faced off against each other on the majestic Trocadéro Esplanade in what was widely seen as a dramatic clash of the two systems.89
For all the surface stability, Hitler faced increasing domestic and international challenges throughout 1937. Economically, the most serious was the crisis of his standard of living project, which had been designed not merely to strengthen the regime at home, but to inoculate the German people against the appeal of Anglo-American consumerism, and to provide the basis for German racial improvement. These efforts were epitomized by an exhibition in Düsseldorf in the summer of 1937, held simultaneously with the Paris fair, entitled ‘A Nation of Workers and Creators’.90 This was intended to highlight the economic growth since Hitler took power, the merits of self-sufficiency and the range of products now available to German consumers, including the Coca-Cola dispensed from a reconstructed bottling plant. Among the local talent showcased was the German company Henkel; Hitler himself visited their pavilion and was photographed amid a display of washing powder and washing machines.91 One wonders whether he remembered his remarks to Hess about the need to bring modern conveniences to the German people back in the 1920s. Likewise, Hitler maintained a keen interest in the Volkswagen project, choosing the site of the planned factory at Fallersleben (christened Wolfsburg).92
In truth, however, Hitler was losing the standard of living battle.93 The Führer might, as he never tired of claiming, have dealt with the unemployment problem better than FDR, but he was nowhere near matching the American Dream. The figures spoke for themselves. After six years of Hitler, about half of all Germans owned a radio set, as opposed to 68 per cent of Britons and 84 per cent of Americans.94 The Volkswagen was in difficulty, as German industry struggled to come up with a car which was also profitable;95 the task was passed on to the German Labour Front. For all the sound and fury about motorization, in fact, no civilian Volkswagen ever made it to the Volk. Despite all the increased industrial activity, wages did not rise much.96 Overall, the German standard of living, even after Hitler’s economic ‘miracles’, was a third lower than that of Britain, partly due to inferior productivity.97 Hitler effectively conceded defeat in a speech in May 1937. He began to emphasize sufficiency in basic goods and developed a theory of excess.98 Hitler warned against inflation, and–no doubt aware of the Anglo-American advantage in productivity–linked wage increases to increased productivity. He urged German workers to travel abroad as tourists to see how well off they were themselves, but the comparisons he made were with Soviet poverty, which he could easily outperform, rather than Anglo-American prosperity, which he had no hope of matching.
These trends were aggravated by the economic bottlenecks produced by rearmament, which competed for resources not only with consumption but also with culture. All three fronts mattered to Hitler, as they were all theatres in the one struggle against Anglo-American capitalism. What distinguished them was the question of timing. Consumption and culture were part of a long-term racial vision; rearmament was geared to a much shorter-term strategy. Ideally, Hitler wanted to advance in all three theatres simultaneously, but that was increasingly difficult as the demand for raw materials grew. He found himself arbitrating so many requests to balance the allocation of steel for armaments with that for the construction or renovation of theatres, opera houses and other buildings that in May 1937 he requested a list of all urgent building plans which required the use of steel.99 Two months later, Hitler was told that if he authorized the expansion of the Schiller Theater in Berlin, he would have to reduce the steel allocation to others, including the Wehrmacht.100 Hitler’s reaction then was to approve the plans for the theatre with ‘immediate effect’ and demand more steel overall, threatening to take the matter out of the remit of the Four Year Plan and into his own hands. For now, consumption and culture retained their importance alongside rearmament, and in some cases trumped narrowly military priorities, but soon one or more of them would have to give way.
The immediate consequence of all this was further to undermine the position of Schacht, who felt that he was being asked to do the impossible, and who was simply regarded as a failure by Hitler. His presidency of the Reichsbank was renewed in mid March 1937, but the Führer reduced the extension of his term from the four years envisaged in the draft of the announcement to a mere twelve months. Schacht was on notice. Hitler’s main motivation in keeping him on was to reassure the outside world. When Schacht tried to extract a promise not to issue any more inflationary MEFO bills, which would have endangered Hitler’s rearmament plans, the Führer bridled. There was a furious exchange, and when Schacht stood his ground, Hitler gave way in part.101 Throughout the summer Schacht protested, obstructed and generally dragged his heels. In a letter copied to Hitler he warned that ‘one cannot either bake bread or cast cannon with paper’.10
2 A visibly unnerved Hitler summoned him at once to the Obersalzberg. The interview was unproductive. Schacht once again offered to resign, but Hitler still needed him to cover his rearmament programme abroad.
Worrying though the economic situation was, Hitler perceived the main threat to his authority in 1937 to come from another quarter, namely organized religion. He was horrified to be told by his intelligence services in late March 1937 that Pope Pius XI was about to issue a blistering encyclical. It had been in gestation for several months, during which the ailing pontiff consulted with the German church about the growing menace of Nazism.103 Entitled ‘With Burning Concern’, the encyclical was signed on 14 March 1937, and read from German pulpits on Palm Sunday, 21 March 1937. It condemned the regime’s ‘open and covert’ attacks on the Church, and the ‘illegal and inhumane’ pressure exerted against believers. It also struck at the very root of Hitler’s ideology, attacking ‘race and blood’ as ‘false coins’ which ‘do not deserve Christian currency’, and rejected repressive ‘human laws’ which were so ‘in contradiction with the natural law’ as to be ‘vitiated with a taint which no force, no power can mend’. For Hitler, there was no doubt about it. He was under attack from Roman Catholicism, a threat which might be domestic in manifestation but international in origin.
Retaliation was swift. Distribution of the encyclical was banned.104 A stiff note was sent to the Vatican.105 Relations cooled dramatically.106 When German academics were invited to the opening of the Papal Academy of Sciences in Rome, Hitler banned them from attending in light of ‘the current attitude of the Holy See towards the German Reich’.107 It was the German Catholic Church, however, which bore the brunt of the Führer’s wrath. ‘We will never accept,’ Hitler warned in a speech in late April 1937, ‘that anything should place itself above the authority of [the state] not even a church.’108 In 1937, the Gestapo, especially Reinhard Heydrich, spent much more time investigating the ‘black’, that is clerical, threat than the ‘red’ menace of social democracy and communism, which had by then been largely crushed.109 Likewise, the Propaganda Ministry considered the struggle against the Catholic Church the ‘most important domestic political confrontation’.110
The regime’s main strategy was to discredit the church as an institution. Hitler urgently instructed the Justice Ministry to resume legal proceedings against alleged clerical child abusers, which had been largely suspended in the interests of good relations.111 He authorized the use of material gathered during the court cases for political purposes by local Gauleiter.112 Goebbels–at Hitler’s direct instigation–exploited the propaganda opportunities mercilessly, dragging the church through the mud at every opportunity, in newspaper articles and radio broadcasts. Almost daily, Germans were treated to lurid accounts of clerical sexual abuse, not all of them invented. The Führer himself was more restrained in his remarks, but made unmistakable references to the trials in his own speeches.113 The regime also pressurized the Catholic milieu in general. Sometimes tensions spilled over into violence, for example in July 1937, when participants in a Corpus Christi procession in the strongly Catholic Ermland region of East Prussia resisted police trying to confiscate the flag of a Catholic youth association.114 Hitler was on the verge of plunging Germany into a new Kulturkampf.
For all his sound and fury, Hitler was anxious to avoid a complete breach with the Catholic Church for as long as possible. This was partly because he feared the international influence of the Vatican, and partly because he did not want to alienate German Catholics from the Volksgemeinschaft and drive them into the hands of the external enemy. ‘According to confidential sources,’ the Italian ambassador to the Vatican reported in June 1937, ‘Hitler has affirmed the need to avoid confessional wars and his determination that the German people not be divided into two separate religious parties.’115 Towards the end of July 1937, Hitler ordered a sudden end to the prosecution of alleged clerical child abusers.116 In the autumn, he considered a plan to abolish all religious holidays, but thought better of it, on the grounds that it was ‘not appropriate at present’. By the end of the year, Hitler had re-established an uneasy truce with the Roman Catholic Church.
One of the reasons why Hitler was so anxious about the power of the Catholic Church was because he saw the Vatican as allied to the Habsburg cause in Austria. The Führer was unsettled by the increased activity of the restorationist movement there. In mid January 1937, he was confronted with a warning from Papen in Vienna about the growth of the legitimist cause, which was focused on the young Otto von Habsburg, son of the last emperor, Karl, and a serious political figure in his own right.117 Not long afterwards, Göring met with Mussolini in Rome and told him that Germany would never tolerate a ‘Habsburg Restoration’ in Austria in any form.118
What Hitler was worried about here was not Habsburg armies, but the power of the legitimist idea, which he regarded as a direct challenge to his own imperial authority. He knew that insignia of the old Holy Roman Empire were in Vienna and could be used to underpin claims in the Reich. Hitler saw himself as the culmination of all the strands of German history. He contained and resolved a multitude of contradictions. The great picture window on the Berghof looked out on the Untersberg in which–as Hitler liked to tell guests119–the court of the emperor Charlemagne, or as in some accounts of Barbarossa, was asleep and waiting for the last epic battle to establish a new Reich. German political history, on his reading, had ended in 1933, now Otto von Habsburg threatened to drag Germans back into the past. Quite apart from being a representative of a loathsome dynasty, Otto was a menace to Hitler’s entire imaginative project. The effect of all this was to enhance Hitler’s fears of an international Catholic conspiracy against him, to increase his desire to reach an understanding with Italy, Hungary and other powers affected by the Habsburg threat, and to strengthen his determination to settle the Austrian question as soon as possible. The skeletal military contingency plan against Austria drawn up in late June 1937 was thus logically given the code name ‘Otto’.120
Amidst all this, Hitler had not given up his plans to secure Lebensraum for the German people. It was central to his entire economic theory. Once again, his main point of reference remained the global powers, especially the United States. The Americans not only had plenty of space, it was also very fertile. In the Mississippi Delta, he argued in May 1937, ‘a people could live there in plenty’, provided there was no flooding, a reference to the catastrophic floods there that decade, and another sign that the Führer was well aware of events across the Atlantic. The Germans, by contrast, had no space. Reprising themes familiar from earlier speeches, Hitler claimed that they lived jammed together in a tiny area, while the Russians, the British and especially the North Americans lived in ‘superfluity’.121 ‘Our living space is too small,’ he reiterated a few months later, and needed to be supplemented by ‘colonies’.122 This meant lifting the Germans out of their current position as ‘a people which did not belong to the exclusive ranks of the global propertied elite’. 123 Germany, Hitler effectively argued, picking up a theme from his 1920s rhetoric, was still part of the global proletariat.
The purpose of food, Flann O’Brien once said, is to ‘keep people alive and in their own country’. With this in mind, the Third Reich had sought self-sufficiency from the very beginning, but the limits of greater agricultural productivity were clear by 1937. Yearly ‘battles of production’ had increased output substantially, perhaps as much as by a third. Now the law of diminishing returns applied. It was against this background that in February 1937 Hitler instructed the Ministry of Agriculture to start planning the settlement of lands beyond the current borders of the Reich.124 He announced that ‘the final non-negotiable aim for us is a Great Reich’, which would ‘establish and secure the future food supply of Germany’.125 The area under consideration was Czechoslovakia and, especially, Ukraine. It emphatically did not include, at this point, Poland, whose diplomatic and military cooperation was vital to any campaign against the Soviet Un
ion.
There was as yet no timetable, no sense of immediate urgency about these plans. ‘The Zugspitze [Germany’s highest mountain] cannot be climbed in one step,’ he warned, ‘one takes one step at a time, but we are pretty much halfway up.’ ‘Only a short time has passed,’ Hitler continued, ‘but I have planned the work of this movement over a longer timescale, and the final implementation of the programme will take as long as it takes until we have raised a generation in Germany which has completed our schooling.’126 These were generic exhortations, designed to prevent the German people from settling down, setting them ever newer tasks to rejuvenate the race. ‘So long as you carry out ambitious projects,’ he proclaimed, ‘you will remain young.’ A few months later, Hitler conceded that his plans were a ‘project for the future’. There was no sense at all of when the second half, or the last third, of the programme would be completed, when the ‘final objective’ would be reached, but the general sense conveyed was that of a generational struggle which would last many decades and perhaps centuries.
In the course of 1937, the new National Socialist year unfolded one last time as Hitler worked through the calendar of invented traditions. The press followed his progress as he switched between the Imperial Chancellery, his Munich flat and the Obersalzberg. It culminated that autumn in a long Indian summer of festivals, rallies and visits. Spurning an invitation to the 700th anniversary of the founding of Berlin, Hitler set off for Bayreuth. He then went on to the party rally at Nuremberg, where he delivered a series of keynote speeches. Germany was now much more secure, the Führer claimed, partly because it had allies such as Italy and Japan, but mainly because of its ‘systematic racial policy’. This, Hitler averred, was ‘creating the new human being’, a perhaps deliberate echo of the Soviet ambition to create ‘the new man’. These new people were not merely more numerous–he emphasized the ‘growing number of births’–but also better-looking. ‘How beautiful our girls and boys are,’ Hitler continued, ‘how glowing is their glance, how healthy and fresh is their posture, how splendid are the bodies of the hundreds of thousands and millions, which are schooled and nurtured by our organizations’. In short, Hitler celebrated ‘the rebirth of a nation through the conscious breeding of a new type of human being’.127
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