At the...meeting of senior officials called on August 20, 1935, President of the Reichsbank Dr. Schacht first of all described the worrying effects that German policy with regard to Jews was having on the economic situation by quoting specific examples. His account was climaxed by the observation that he was forced to entertain serious doubts whether in view of the increasingly radical trend in the policy on the Jews it would be possible to achieve the economic targets set by the Fuehrer, finding work for the unemployed and reconstruction of the Wehrmacht (and obtaining raw materials from abroad)... Schacht rejected any suggestion that he might be called pro-Jewish. All he was doing was to point out the results for his field of operations of irresponsible incitement against the Jews. Schacht was most sharply critical of the independent operations of certain Party agencies, the Labor Front, the National Socialist Trade and Crafts Association (NS-Hago), as well as the activities of Gauleiter Streicher.

Reich Minister of the Interior Frick supported Mr. Schachts criticism in general and had a memorandum read, which was directed to the Governments of the German Laender, which, in a sharp tone, demanded determined intervention by the police against illegal individual operations directed against Jews. Frick added the explanation that the police would remain absolutely passive if Party Organizations themselves carried out anti-Semitic operations. In that case, however, the responsibility would remain exclusively that of the Party.

Minister of State Wagner, as Representative of the Party, declared that the Party also disapproved of individual operations. But nevertheless the State must take the anti-Semitic mood of the population into account, and proceed with the gradual elimination of the Jews from the economy by means of legislation. This would reduce the unrest that now existed within the population.

Secretary of State von Buelow pointed out the importance of the Jewish Question in foreign affairs. Foreign affairs suffered considerably from the backlash following excesses against the Jews by irresponsible organizations. In view of the approaching Olympics, whose importance for foreign relations could not be overestimated, some arrangement must be made to prevent incidents such as that on the Kurfuerstendamm,* in consideration of the expected influx of foreigners.

It emerged from the discussion that, generally speaking, the Partys Jewish Program should be retained as to substance, but the methods applied be subjected to criticism. There would be legal measures to put a stop to the limitless growth of anti-Semitic activities on the part of irresponsible organizations and private individuals in every possible area of life. But at the same time there would be special legislation to control Jewry in certain areas, particularly in all economic matters; as for the rest, they were on principle to retain their freedom of movement.

No general and unified aim of German policy with respect to the Jews was produced by the debate. The arguments of Ministers responsible for various departments merely revealed that the Jewish Question made their political task more difficult. The observation made by Mr. Schacht that he would not be able to accept responsibility for the completion of the program of Reconstruction unless something were done about anti-Semitic excesses, sounded, in its various forms, like an ultimatum. But Mr. Schacht did not draw the conclusion that he must demand a radical change in the Partys Jewish Program, or even the methods by which it was carried out, for example, a ban on the Stuermer. On the contrary, he maintained the fiction of the 100-percent execution of the Jewish Program.

Both Mr. Schacht and the Party Representative pointed out during the debate that in this question there was a divergence in the basic attitudes of Party and State, which was significant in principle beyond the concrete question under discussion. The representatives of the departments in most cases pointed out practical disadvantages which developed in their areas, while the Party based the need for radical steps against the Jews on political-emotional and abstract-philosophical grounds.

Yad Vashem Archives, JM/2245.

* The reference is to anti-Semitic disturbances which occurred on July 15, on the Kurfuerstendamm, Berlin.