“Germany has too little living space for her population. She has made every effort, and certainly greater efforts than any other nation, to extract from her own existing small space, whatever is necessary for the securing of her livelihood. However, in spite of all these efforts the space does not suffice.” (EC-415)
Schacht had hoped, it is believed, that his desire for additional space for Germany would be realized without resort to war. In Austria, for example, he had authorized 200,000 Marks a month to be set aside for the National Socialists in Austria, hoping thereby to facilitate the absorption of Austria into Germany without war. But if Germany’s neighbors would not accede to the conspirators’ demands for additional space, Schacht was willing to go to war to fulfill those demands.
Thus, on 23 September 1935, Schacht told S. R. Fuller, Jr. at the American Embassy in Berlin:
“Colonies are necessary to Germany. We shall get them through negotiation if possible; but if not, we shall take them.” (EC-450)
In January 1937, Schacht, in a conversation with Ambassador Davies, impliedly threatened a breach of the peace unless Germany’s demands for colonies were met. The conversation is related as follows in a report under date of 20 January 1937, by Ambassador Davies to the Secretary of State:
“He [Schacht] stated the following: that the present condition of the Germany people was intolerable, desperate and unendurable; that he had been authorized by his Government to submit proposals to France and England which would (1) guarantee European peace; (2) secure present European international boundaries; (3) reduce armaments; (4) establish a new form of a workable League of Nations; (5) abolish sanctions with new machinery for joint administration; all based upon a colonial cession that would provide for Germany an outlet for population, source for food stuffs, fats and raw material. * * *” (L-111)
The inference was clear: without a colonial cession, peace could not be guaranteed. Equally clear was the inference that it would be Germany in its search for “Lebensraum” that would disturb the peace.
On 21 December 1937, Schacht indicated to Ambassador Dodd that he desired the annexation of neighboring countries, without war if possible, but with war, if necessary. The pertinent portion of Ambassador Dodd’s notes on this conversation are as follows:
“Schacht meant what the Army chiefs of 1914 meant when they invaded Belgium, expecting to conquer France in six weeks; i.e., domination and annexation of neighboring little countries, especially north and east. Much as he dislikes Hitler’s dictatorship, he, as most other eminent Germans, wishes annexation—without war if possible, with war, if the United States will keep hands off.” (EC-461)
(3) Schacht knew of Hitler’s plans to wage aggressive war and wilfully provided the means whereby such a war might successfully be waged. Whether or not Schacht personally favored war, it is clear that he at least knew that Hitler planned military aggression and that he was providing Hitler with the instrument by which those plans could be executed. Even before Hitler’s accession to power, Schacht knew from a reading of Mein Kampf that Hitler was bent upon expansion to the East by force of arms (3727-PS).