Hitler

endangered by putting the ‘dark’ side of the regime on view. Open anti-Jewish violence, such as had punctuated the previous summer, could not be permitted. With some difficulties, antisemitism was kept under wraps. The antisemitic zealots in the party had temporarily to be reined in. Other objectives were for the time being more important. Hitler could afford to bide his time in dealing with the Jews.
    The Olympics were an enormous propaganda success for the Nazi regime. Hitler’s Germany was open to viewing for visitors from all over the world. Most of them went away mightily impressed. Away from the glamour of the Olympic Games and out of the public eye, the contrast with the external image of peaceful goodwill was sharp. By this time, the self-induced crisis in the German economy arising from the inability to provide both for guns and butter – to sustain supplies of raw materials both for armaments and for consumption – was reaching its watershed. A decision on the economic direction the country would take could not be deferred much longer.
    II
    Already by spring 1936, it had become clear that it was no longer possible to reconcile the demands of rapid rearmament and growing domestic consumption. Supplies of raw materials for the armaments industry were sufficient for only two months. Fuel supplies for the armed forces were in a particularly critical state. Economics Minister Hjalmar Schacht was by now thoroughly alarmed at the accelerating tempo of rearmament and its inevitably damaging consequences for the economy. Only a sharp reduction in living standards (impossible without endangering the regime’s stability) or a big increase in exports (equally impossible given the regime’s priorities, exchange rate difficulties, and the condition of external markets) could in his view provide for an expanding armaments industry. He was adamant, therefore, that it was time to put the brakes on rearmament.
    The military had other ideas. The leaders of the armed forces, uninterested in the niceties of economics but fully taken up by the potential ofmodern advanced weaponry, pressed unabatedly for rapid and massive acceleration of the armaments programme. The army leaders were not acting in response to pressure from Hitler. They had their own agenda. They were at the same time ‘working towards the Führer’, consciously or unconsciously acting ‘along his lines and towards his aim’ in the full knowledge that their rearmament ambitions wholly coincided with his political aims, and that they could depend upon his backing against attempts to throttle back on armament expenditure. Reich War Minister Werner von Blomberg, Colonel-General Werner Freiherr von Fritsch, Commander-in-Chief of the Army, and General Ludwig Beck, Chief of the Army General Staff, were thereby paving the way, in providing the necessary armed might, for the later expansionism which would leave them all trailing in Hitler’s wake.
    Even so, the economic impasse seemed complete. Huge increases in allocation of scarce foreign currency were demanded by both the Ministry of Food and the Ministry of Armaments. The position could not be sustained. Fundamental economic priorities had to be established as a matter of urgency. Autarky and export lobbies could not both be satisfied. Hitler remained for months inactive. He had no patent solution to the problem. The key figure at this point was Göring.
    Hoping to keep the party off his back, Schacht helped persuade Hitler to install Göring at the beginning of April as Plenipotentiary for the Securing of the Raw Materials and Foreign Exchange Demands of the Reich. Göring’s brief was to overcome the crisis, get rearmament moving again, and force through a policy of autarky in fuel production. But by now Göring was in the driving-seat. Schacht was rapidly becoming yesterday’s man. In May, shocked at the new power-base that his own machiavellian manoeuvrings had unwittingly helped to create for Göring, the Economics Minister protested to Hitler. Hitler waved him away. He did not want anything more to do with the matter, he was reported as telling Schacht, and the Economics Minister was advised to take it up with Göring himself. ‘It won’t go well with Schacht for much longer,’ commented Goebbels. ‘He doesn’t belong in his heart to us.’ But Göring, too, he thought would have difficulties with the foreign-exchange and raw-materials issue, pointing out: ‘He doesn’t understand too much