Berlin, June 14, 1934
Dear Mr. Messersmith:
I appreciate very much receiving your kind letter.
It wis good of you indeed to sit down and write me a long letter hy hand N
when you must have so many other things to do. The letter which I have
just received mentions the trip which you had on the Danube with the
Chancellor. You can imagine how much I miss having the opportunity of
hearing all about it and getting your reactions. You will bear with me if
I recall with a certain amount of pathos the memory of our past experinces
and association from which I derived so much satisfaction. However the
hope of seeing you in the not too distant future helps to fill up the
vacuum which I feel around me. you
I have been wondering again and again how I could write to/openly and
without fear of the letter being disturbed and in the last pouch I sent
a resume of the situation to you via Washington. It was in the form of
a letter addressed to Mr. Moffat, whom I know personally. A copy of it
is enclosed herewith. I am sending this letter to you with the courier
who is leaving Saturday for Brussels and Paris. The letter will be mailed
to you from Paris. Mr. White informed me today that a courier was soon
leaving; and in the future I will avail myself of every courier to send
you a personal letter. Besides I shall take the opportunity of getting as
much information together as I can. I shall always have a talk with
the Ambassador before concluding my letter and also with Mr. V/hite.
Besides you know that I have other contacts including the newspaper
men. Lochner and I are becoming pretty good friends, and he will give
me all he gets. I hope you will not think from the letter I sent to
Mr. Moffat that I was trying to imitate you; on the other hand you will
have some satisfaction in realizing that I have always tried to be an
apt scholar. I thought it good to try to keep up to a certain extent
the series of personal letters to somebody in the Department. After all
there may be something in them worth while.
Mr. Baerwald has been in to see me twice since you left and the letter
which I sent to Mr. Moffat contains part of the information which Mr.
Baerwald gave me, particularly about the metting of the generals of the
Eeichswehr at Bad Nauheim. Since writing that letter Mr. Baerwald has
been in a ggain. In the meantime he has spent a week in Paris. He seems
to have learned nothing new from his contacts here, except that Hitler
and Hindenburg have had a serious misunderstanding and that Hindenburg
has gone home to his estate in Neudeck in a huff. Baerwald also said
that the interview between Hitler and Mussolini which is now going on
was not altogether at the request of Hitler, but that Mussolini has become
somewhat alarmed at the rumored instability of the Hitler regime
on account of the economic and financial crisis and that Mussolini has
thought it about time to give Hitler a measure of real support fearing
the Italian Facistic ship might be on the defensive if the Hitler regime
should fall.
The financial and economic situation is getting steadily worse. As you
learned today the moratorium on the transfer of all debt interest including
the Young and Dawes loans has been declared effective July 1.
When I referred not long ago to the fact that what you had written to
Mr. Phillips had since been proved, I referred particularly to your advice
to the extent that nobody c&uld place any faith in this Government. You
said that we could not make any agreements with the present regime in
Germany. This was sensational^proved not long agao when Steere discovered
in a Swedish official publication the announcement of the fact that the
lard quota from there was 60% into Germany. It was supposed to be confidential
but some how o*r other it got into an official publication. This
after the solemn assurance f-om the Foreign Office that all quotas had
been fixed at 40 % like ours. The official prpof was shown to the Foreign
Office by our Embassy and the Foreign Office got red in the face and
admitted the hoax. The matter was telegraphed to Washington and a note
came in today about it; but I have not had time to get all the information
from Mr. White. We are presently to have a conference at the Embassy
about this.
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The Ambassador has been having a few rather intimite contacts with the
Minister of Commerce Herr Schmidt. LIr. White tells me that Schmidt let it
"be known to the Ambassador that the parting of the ways must come very
soon and that Hitler will have to decide whetherv or not he is going to
keep radicals like Goebels, Prick, Streicher and others, or whther he is
'going to separate himself from the men who are clamoring for a moderate
policy. I also understand that Schacht has insisted upon resigning but
it has been intimated to him that resignation would be regarded as
treason and that he could expect to be sent to a concentration camp if he
resigned. There is a great deal of unrest and the people are talking all
sorts of things. The increased exchange restrictions and the new embargoes
placed on shipments of lumber have thrown the ports of Hamburg and Bremen
into a panic; and a good deal of fear exists there as to the future of
those centers. The only thing that is thriving in Germany of course is
the industry which caters to certain classes of home trade. While the
foreign trade situation becomes worse the Nazis are succeeding in forcing
more people into the working processes; all of which is very unhealthful
because it is all artificial and on no solid basis.
The air is loaded with something which is supposed to happen in July. .
I believe this proceeds from the fact that new recruits are being taken
into the Eeichswehr (not from the S. A. ); that Rohm has taken a sick
leave ( which is variously interpreted); and thatvthe whole S. A. is to
have a vacation during July. This all gives rise to uneasiness; but I do
not believe there is anything of very special importance attached to these
three circumstances.
The big campaign which was launched against critics and grumblers has
not been carried very far. It is like all the other Nazi programs: it
amounts to nothing. The seriousness of the situation is indicated however
by the fact that it was considered necessary to launch such a program.
I learn from Press reports that some of these speeches were not in
the usual Nazi defiant tone, nor threatening eaither; but apologetic and
begging people to have patience. The young fellows who have been foreed
onto the farms as Landgehilfe ar4 sowing a good deal of discontent in the
rural districts where I understand the farmers are getting awakened to the
real situation. The drouth has very much injured the crops, on account
of which there will be a tremendous shortage of fodder for the animals.
This resulted in a rush to unload the meat on to the markets; but at
once came out decrees controlling this panic. No appreciable rain has
fallen here for a long time and I an told by Christy that already 25 95 of
the crops have been lost. The drouth still continues. Heard reports #'£*ru,
- 3v -
for a long time by these most unfortunate people. One thing, however, is
sure : the Regime is not gaining ground in popular support. The uncomforatable
and uncongenial atmosphere that the terror and the forced
acquiescence are creating has "begun to seep down into the Yery commonest
walks of life. The rhapsodies of the leaders and the endless preaching
of Nazi doctrine have been served up to everybody"ad nauseam" and everybody
is sick of it. I went the other day to see the President of the
who fought four years in the war . He raged and swore
against the situation and said that he saw no salvation for Germany
unless she returned to a sane policy. Some of the officials I saw in the
Reichsbank act as if they would like to weep on my shoulder. Decent men
are ashamed and dazed by what has happened to this country. I feel very
often that men of standing who feel that they must do something to establish
their moral correctness vis-a-vis a visitor like myself are actually
constrained by some inv/ard impulsion of decency to say something which
reveals their position and attitude.
The work in the office is unusually heavy. Things pile on me from
every side and it seems that I shall never get through. I am so hard
pressed at time that at five o'clock I am fairly worn out. You know exactly
what I mean. At five o'clock I start to get my dossiers ready to begin
dictation early in the morning. I have often to thank you for making the
way open for me to dictate and not write. It has given rae a great deal
of freedom. The position of American trade is getting steadily more
precarious in Germany. Import restrictions are now so low as ten per
cent, through the divisen curtailments. An embargo has been just placed on
the imports of logs and lumber, and many valuable American cargoes have
been caught afloat. No warnings, no facilities. I am very busy working
on a number of protection cases. I believe that we have nearly reached
the bottom so far as American trade in this country is concerned. After
zero has been reached we shall probably have a period of readjustment and
perhaps begin to build up again; but this will only be possible if there is
a complete change in Government. I have little confidence in the so-called
moderation possibilities.
I made a special point of going to the Ambassador this afternoon in order
to get what information I could for this letter. He asked me how I was
intending to get the letter to you. I explained that I intended to utilize
the courier who was leaving tomorrow for Brussels and Paris. He said that
he had received a letter from you and was much obliged that I had called
Jiiar attention to the fact that a courier was leaving and that he would
make a point of writing to you. He did, however, discuss the situation
with me; but pointed out that there was nothing very special to report.
I mentioned that fact that I had heard that Mussolini had invited Hitler
because Mussolini was worried lest the Hitler regime would totter. The
Ambassador said that undoubtedly that was true because he had had confidential
word from Long in Rome that the situation in Rome a few days ago
was very tense; and that obviously both dictators understood the necessity
for mutual support. The Ambassador felt sure that the Austrian situation
was a major theme at the conversations. The Ambassador receives visits from
Riebentrop, who it appears talks very openly to the Ambassador. In view of
the fact that the Ambassador espressed his intention of writing to you
also by this courier I did not direct the conversation into order to be
further informed By ^the:-Ambassador. He asked whether or not I had heard of
anybody being appointed to your place in Berlin, and I told him of a message
which Mrs. Ray Fox sent to her husband in Berlin, which came in the
Department's Grey Code. " For Pox sunshine Jenkins slated all well Betty".
We had to decode the message completely as it was addressed "American Consul"
and signed "Hull" . Having two Foxes in the office we had to finish the
message before knowing to whom- it belonged. The Ambassador seems to want
no changes in the staff in Berlin; and told me that he wrote to the Department
two weeks ago asking that no changes be made. He said that the situation
in Germany is critical and that the Tatatus §uo" of the personell should
be maintained. I don't know what objection he should have to a new Consul
General; I am sure I have none. I shall certainly give any man who comes
here loyal support, and go on doing my job the best I can. I have not the
slightest illusionments about all these things; and while I appreciate the
Ambassador's high confidence in me I hope that his attitude will not lead
Washington to think that I am influencingnhim or scheming? as nothing would
be farther from the realities.
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