The Battle of Britain Five Months That Changed History, May—October 1940 by James Holland (z-lib.org).epub

had known each other for some time; Milch had even helped Göring secure
employment during the 1920s. Furthermore, Lufthansa had supported Hitler
during his election campaign, providing him with flights all over Germany.
Yet Göring also recognized that in Milch he had found a man who not only
had a deep and expert knowledge of aviation and business, but who also
had a rare talent for organization.
Milch did not waste any time. Although Göring had cleared the path for
financing the Luftwaffe, it was Milch, together with Dr Hjalmar Schacht,
then President of the Reichsbank, who hatched the plan to make it happen.
Together, they found an old skeleton company, called the Metal Research
Company, of which Schacht and Milch became directors. This cover
company was then guaranteed by the Reichsbank and used to finance the
growth of the Luftwaffe with its own bills of exchange. These were
effectively a form of banknotes, a kind of IOU, but which, because they
were guaranteed by the Reichsbank, were of effective value. The bills were
given a validity of three months, but as soon as that time was up the
Reichsbank extended them another three months, and another three months
again and so on. They could also be cashed in early at the Reichsbank or
they could be used as a form of payment to selected industrial concerns. It
was hardly legal, but it worked, and it enabled Milch to plan a rapid and
vast rearmament programme.
Key to this was the expansion of the aircraft industry. The main players
were Junkers, Heinkel, Focke-Wulf, Arado, Dornier and the Bavarian
Aircraft Company (later Messerschmitt). Milch sent the then Colonel Albert
Kesselring to inspect the Heinkel works on the Baltic Coast. On the basis of
Kesselring’s visit, Heinkel were asked to open a much larger new factory at
Rostock. Professor Willi Messerschmitt’s Bavarian Aircraft Company was
also given large orders to aid expansion. Only Professor Junkers was
digging in his heels. A confirmed pacifist, he repeatedly resisted attempts
by Milch and Göring to hand over the patents of his designs and control of
his aircraft factories. But eventually, after threats of being prosecuted for
treason, the ageing inventor and designer agreed, in October 1933, to hand
over 51 per cent of his companies to the Reich. A major obstacle to
progress had been overcome.
Plans for the establishment of a dozen specialized air-training schools
for fighter and bomber pilots, bomb aimers, observers and air gunners were
also drawn up and were to be completed within a year. Factories making