[The defendant resumed the stand.]
DR. SAUTER: Mr. President, may I continue the examination of the Defendant Funk?
Dr. Funk, yesterday you gave us a brief account of your life, told us that you are 56 years of age, that you have been married for 25 years, that you were editor of the Berliner Borsenzeitung for 10 years; and in conclusion you told us yesterday what your convictions were regarding the future development of Germany.
Perhaps you can again tell us something of your viewpoint, since you were interrupted by the recess yesterday and since your health was in such a poor state yesterday evening that you could scarcely remember what you had told the Court. Well, what were your views on Germany's economic prospects at the time when you entered the Party? Perhaps you can go over it briefly again.
FUNK: At that time Germany was in the midst of a very difficult economic crisis. This crisis was caused chiefly by the reparations, the way in which these reparations had to be paid, and by the inability of the governments then in office to master the economic problems. The most disastrous feature of the reparations policy was that German mark credits in immense sums were transferred to foreign countries without receiving any equivalent in return. As a result there was a tremendous surplus and overpressure of Reichsmark abroad. It led to inflation in Germany and the countries with stable currencies bought Germany out. German industry incurred heavy debts and consequently came temporarily under foreign control; German agriculture became indebted. The middle classes, who were the chief representatives of German culture, were impoverished. Every third German family was unemployed, and the Government itself had neither the power nor the courage to master these economic problems. And these problems could not be solved by means of economic measures alone. The first essential was the presence of a government possessing full authority and responsibility; and then the development of a unified political will among the people.
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The National Socialists at that captured 40 percent of the seats in the Reichstag; the people streamed to this Party in ever increasing millions, especially the young people who were animated by idealism. The fascinating personality of the Fuehrer acted as a giant magnet. The economic program of the Party itself was vague; and in my opinion it was drawn up mainly with an eye for propaganda purposes. There were lively arguments about it in Party circles with which I came in contact in 1931.
At that time, therefore, I decided to give up my position as editor of a paper with a large circulation among the middle classes and to start on my own by editing an economic and political news service which went to the most diverse sections of economy, to leading Party circles as well as to economically interested parties siding with the German National Party, the People's Party, and even the Democrats.
DR. SAUTER: Dr. Funk, you said before, approximately, that according to the opinion you expressed in 1931, only a government with full authority and full responsibility, that is, only a strong state and a unified political will, could lead Germany out of the crisis of that time, which was, of course, merely a part of the world crisis. Did you at that time ever reflect as to whether the Leadership Principle which was later developed to an increasing extent-whether this Leadership Principle could be made to harmonize with your ideas of economic policy? Or, putting it negatively, did you at that time anticipate great wrongs as a result of this Leadership Principle?
What can you say on this point?
FUNK: As to a principle of government, well, that is, a Leadership Principle, one can never say a priori whether it is good or bad. It depends on existing circumstances and, above all, on those who do the governing. The democratic-parliamentary principle had not been successful in Germany. Germany had no parliamentary and democratic tradition, such as other countries had. Conditions, finally, were such that when the government made decisions, the few votes of the economic party were decisive; and these were mostly bought. Therefore, another principle had to be made the dominant one; and in an authoritarian government, if those who bear the authority and the responsibility are good, then the government also is good. The Leadership Principle meant, in my opinion, that the best men and the best man should rule and that authority would then be exercised from above downwards and responsibility from below upwards. And in conversations with Hitler and other leading personalities of the Party in 1931 and, as I said, from the faith and enthusiasm which the German people brought to this political movement, I formed the opinion that this Party would
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have to come into power and that through it alone salvation could come. I, myself, wanted to put my own economic ideas into practice in this Party.
DR. SAUTER: Dr. Funk, you have just been speaking of the personality of Hitler. Through whom did you meet Hitler?-that is, who were persons in the Party by whom you were first won over to the Party?
FUNK: Chiefly, Gregor Strasser, as I said yesterday, who arranged my first meeting with Hitler. Not until much later, in Berlin, did I meet Hermann Goering. Apart from them I had very few acquaintances in the Party at that time and played no role in it myself.
DR.SAUTER: When you met Hitler what impression did he make on you at that time? I should like to say beforehand, you were at that time-1931, I think-a mature man of over forty. What impression did you have at that time of Hitler's personality and aims, et cetera?
FUNK: My first conversation with Adolf Hitler was very reserved. That was not surprising as I came from a world which was entirely strange to him. I immediately received the impression of an exceptional personality. He grasped all problems with lightning speed and knew how to present them very impressively, with great fluency and highly expressive gestures. He had the habit of then becoming absorbed in the problems, in long monologues, so to speak, in this way lifting the problems to a higher sphere. At that time I explained to him my economic ideas and told him especially that I upheld the idea of private property, which for me was the fundamental tenet of my economic policy and which was inseparable from the concept of the varying potentialities of human beings. He, himself, heartily concurred with me and said that his theory of economics was also based on selectivity, that is, the principle of individual productivity and the creative personality; and he was very glad that I wanted to work on those lines in the Party and to arrange contacts and support for him in the economic field- which I actually did. In the meantime, however, my relations with the Fuehrer became no closer then, because he said to me himself, "I cannot, at present, commit myself to an economic policy; and the views expressed by my economic theorists, such as Herr Gottfried Feder, are not necessarily my own."
The economic policy section which existed at that time was directed by a Dr. Wagner.
DR. SAUTER: The economic policy section of what? Of the Reich Party Directorate?
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FUNK: The economic policy section of the Reich Party Directorate was directed by a certain Dr. Wagner. I was not invited to political talks. A close connection with the Fuehrer-or a closer connection with the Fuehrer-I really had only in the year 1933 and the first half of 1934, when, as press chief of the Reich Government, I reported to him regularly. At that time it once even happened that he suddenly interrupted the press conference, went into the music room with me, and made me play the piano for him.
Then our relations became a little cooler again, and when I became Minister of Economics the Fuehrer kept me more and more at a distance-whether he had special reasons for this, as Lammers testified here, I do not know. During my office as Minister, I was called in by the Fuehrer for consultations perhaps four times-five at the most. But he really did not need me because his economic directives were given to the Reich Marshal, the responsible head of economic affairs, and later, from 1942 on, to Speer, since armament dominated the entire economy; and, as I said, I had close connections with him only in 1933 and in the first half of 1934 until the death of Reich President Von Hindenburg.
DR.SAUTER: Dr. Funk, you have got a long way ahead. We would like to return now to 1931 or 1932, to the time when you entered the Party. When was that?
FUNK: In the Summer of 1931.
DR. SAUTER: The summer of 1931. You have already told the Court that you did not object to the Leadership Principle for the reasons you have stated.
FUNK: No, on the contrary, the Leadership Principle was absolutely necessary.
DR.SAUTER: On the contrary, you considered the Leadership Principle necessary for the period of emergency that then obtained. Now, I would be interested in knowing: There were other points of view, of course, also represented in the Party program which worked out unfavorably later on and have, in the course of this Trial, been used extensively against the defendants. I point out one example, for instance, the slogan of "Lebensraum"; you have heard it again and again during this Trial. The Defendant Dr. Schacht dealt with this problem also. Perhaps you can give us briefly your own position on this problem and on this question?
FUNK: The problem of living (Lebensproblem) is no slogan; and the problem of living was really a problem for the German people at that time. By "Lebensproblem"...
DR.SAUTER: You mean "Lebensraum"?
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FUNK: . . . or "Lebensraum"-I did not mean the conquest of foreign countries at that time; the thought of war was just as strange to me as it was probably to most other Germans. By "Lebensraum" I meant the opening up of the world for the vital interests of Germany, that is, the participation of the German people in the profitable utilization of the world's goods of which there was a superabundance.
Whether that was to be done by colonies, or concessions, or international trade agreements, I did not trouble to find out at that time.
The expansion of Germany in the world economy before the first World War was the decisive factor which determined me to become an economic journalist. The participation of Germany in the Rumanian petroleum industry, the concession of the Bagdad Railway, the growing German influence in South America, in China, generally in the Far East-all this inspired me very much. At that time already I became acquainted with such men as Franz Gunther of the Discount Bank, Arthur Von Gwinner of the Deutsche Bank, Karl Helferich, the big Hamburg importer, Witthoft, and many other German economic pioneers, and started on my profession with all the enthusiasm of the young journalist.
"Lebensraum" was thus for me at that time the fulfilling of these economic claims, that is, Germany's participation in the world's goods and the abolition of the restraints which hemmed us in on all sides. It was sheer nonsense that Germany on her part should have to pay reparations and debts while the creditor nations on their part refused to accept payment in the only form possible, that is, payment in goods and products,
That period marked the beginning of a great wave of protective tariffs in the world. I recall the American economic policy at that time; I recall the Ottawa agreements, and this mistaken economic policy led to a world economic crisis in 1929 and 1930 by which Germany also was badly hit.
DR. SAUTER: Dr. Funk, have you finished? [The defendant nodded assent.]
Dr. Funk, the Prosecution in their trial brief have contended that you participated in the formulation of the Nazi program. What can you tell us about that?
FUNK: I do not know what the Prosecution understands by Nazi program.
DR.SAUTER: I think-the Party program.
FUNK: That is quite impossible. The Party program, as far as I know, was formulated in 1921. At that time I did not know anything about National Socialism or of Adolf Hitler.
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DR. SAUTER: Witness, the Prosecution has further accused you of setting up the so-called reconstruction program, the economic reconstruction program of 1932, that is, a program for the rehabilitation of German economic life. Is it correct that you established this economic reconstruction program?
FUNK: In 1932 I compiled for a speech by Gregor Strasser some points for an economic program which Strasser himself marked as originating from me. He passed these on to the various Party offices as instructions and propaganda matter.
This economic reconstruction program, which in the words of the Prosecution was to become the economic bible for the Party organizers, is, I believe, in no way revolutionary or even sensational; and it could, I believe, be adopted and accepted by every democratic government. I believe it is pointed out in a book from which the Prosecution has taken various bits of information.
DR. SAUTER: Perhaps it is printed, Witness, in the book by Dr. Paul Oestreich which has been repeatedly quoted. This book contains your biography under the title, Walter Funk, A Life for Economy, and has been used by the Prosecution under Document 3505-PS, Exhibit USA-653.
Dr. Funk, I have the text of this program before me.
FUNK: Please read it.
DR. SAUTER: The whole program covers half a page only and in the main sets forth really nothing which might be considered as characteristic of National Socialist trends of thought?
FUNK: Well, at that time I was not yet a National Socialist or, at least, but quite a young member of the Party.
DR. SAUTER: This economic reconstruction program must be actually read in order to convince oneself how little it contains of the characteristic National Socialist demands. This is a program which Funk says might be accepted by almost any liberal or democratic or other bourgeois party. The program is called, "Direct creation of employment through new State and private investments." That is the first demand. Then productive providing of credit by the Reichsbank but no inflation, rather the re-establishment of a sound currency and a sound financial and credit economy to promote production.
General 1owering of rates of interests paying attention to individual conditions of the economy. Creation of a foreign trade office and a central foreign exchange office. Reorganization of economic relations with foreign countries, giving preference to the vital necessities of the domestic market but with special attention to the export trade absolutely necessary for Germany. Restoration of
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sound public finances, including public insurances. Abolishment of the untenable methods of balancing the budget. State protection for agriculture. Reorganization of the system of house and land ownership in accordance with the principles of productivity and national health. Expansion of the German raw material basis, the establishment of new national industries and trades, organization of manufactories on the basis of technical innovations. That is all, which is comprised in this so-called economic reconstruction program.
FUNK: This program was to be, as the Prosecution has said, the official Party dogma on economic matters. I would have been glad if the Party had professed these principles. In later years I had great difficulties with these various Party offices in connection with my basic attitude on economic policy. I was always considered, even in Party circles, as a liberal and an outsider...
DR. SAUTER: A liberal?
FUNK: Yes. I combated all tendencies towards collectivism; and, for this reason, I constantly came into conflict with the Labor Front. I was supported, especially in my views regarding private property' by Reich Marshal Hermann Goering. Even during the war, he had parts of the Hermann Goering Works denationalized at my suggestion. I was an opponent of a nationalized economy because a nationalized economy will always produce only average results. Nationalized economy means sterile economy. An economy which is without keen competition and individual rivalry will remain stagnant and will achieve but average results. The Fuehrer had, formerly, always agreed enthusiastically with these principles of mine. And it was a great disappointment to me when finally, in the last years, the Fuehrer turned so sharply against the bourgeois world for that meant practically that the whole of my life's work had failed.
THE PRESIDENT: Dr. Sauter, the Tribunal thinks he might get on to something more important than his view on state economy and private enterprise.
DR. SAUTER: Yes, Mr. President.
[Turning to the defendant.] Dr. Funk, you know that it was precisely on account of the big problem of unemployment at the time that Hitler was able to grasp power. What plans did you have for the elimination of unemployment, since you knew that just that very promise...
THE PRESIDENT: Dr. Sauter, we have heard nearly all the defendants on the conditions which obtained in Germany at that time. And there is no charge against these defendants for German economy between the years 1933 and 1939.
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DR.SAUTER: Mr. President, I wanted to ask the Defendant Dr. Funk just how he thought that unemployment could be abolished; for from the testimony of other defendants, I gathered that they planned to eliminate it by other means, such as rearmament, and so forth. As far as I know, this was not so in his case; and I think that in judging the Defendant Funk, the question of how he proposed to handle the elimination of unemployment, whether by rearmament or by some other means, is of some importance. I do not think it will take much time, Mr. President. The Defendant Funk, I am sure, will be very brief.
Perhaps he can...
THE PRESIDENT: He can answer that in a sentence, I should think.
DR. SAUTER: Herr Funk, be as brief as possible.
FUNK: If I am to answer this in one sentence, I can say only that at that time I envisioned the elimination of unemployment by a very precise plan, but at any rate without rearmament, without armament...
DR. SAUTER: But, instead?
FUNK: By methods which I would have to explain. But in any event, armament never came into question then...
DR.SAUTER: But-can you perhaps tell us in a few telling words?
FUNK: First of all, opportunities to work were offered everywhere so to speaks It was imperative to set up a large-scale roadbuilding program in Germany; it was necessary to revitalize the engine industry, especially the automobile industry, which, of course, had to be appropriately protected. An extensive house building program was needed; hundreds of thousands of houses were required...
DR.SAUTER: In short. . .
FUNK: Agriculture lacked mechanization and motorization.
I should like to give here, however, only two figures, two ratios, which throw light on the whole situation. Up to the war two-thirds of Germany's total production went to private consumption and only one-third for public needs. Up to that point, therefore, the armament industry did not play a decisive role.
DR. SAUTER: Dr. Funk, now we will turn to another chapter.
You will remember that the Prosecution contended in their trial brief that the evidence against you was largely circumstantial. I assume, therefore, that it was based upon your offices rather than
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your actions. For this reason I should be interested to know which Party offices you held during the period which followed.
FUNK: Only once, in the year 1932...
DR. SAUTER: That is to say in the Party-not government offices.
FUNK: I understand. Only in the year 1932, and then for only a few months, did I receive Party assignments, because Gregor Strasser wanted to set up for me an office of my own, for private economy. This office, however, was dissolved a few months later when he himself resigned from the Party and from his offices. Then in December 1932 I was instructed to take charge of a committee for economic policy.
DR.SAUTER: In December 1932?
FUNK: Yes. And in February 1933, that is, 2 months afterwards, I gave up this office again. Both assignments were unimportant and never really got going in the short time they lasted. All the gentlemen in the dock who were in leading positions in the Party at that time can confirm this. I never had any other Party office; so that after 1933 I received no further assignments from the Party and no Party office either.
DR.SAUTER: Then this so-called Office for Private Economy (Amt fur Privatwirtschaft), if I understood you correctly, existed for just a few months in the year 1932 but did not actually function. And in December 1932 you were made head of the other office, the Committee for Economic Policy as it was called. Then a month later, in January 1933...
FUNK: February 1933.
DR. SAUTER: February 1933, shortly after the seizure of power, you gave up this so-called office. Is that correct?
FUNK: Yes.
DR. SAUTER: Now for your connection with the Party. Were you a member of any organization of the Party-SA, SS, or any other section of the Party?
FUNK: I never belonged to any organization of the Party, neither SA nor SS, nor any other organization; and as I have already said, I did not belong to the Leadership Corps.
DR. SAUTER: You did not belong to the Leadership Corps?
FUNK: No.
DR. SAUTER: You know, Dr. Funk, that the Party functionaries, that is, the Party veterans, and so forth, met annually in November at Munich. You have yourself seen a film showing this anniversary meeting.
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Were you ever invited to these gatherings on 8 and 9 November?
FUNK: I do not know whether I received invitations; it is possible. But I have never been at such a gathering, for these meetings were specially intended for old Party members and the Party veterans, in commemoration of the March on the Feldherrnhalle. I never participated in these gatherings, as I was averse to attending large gatherings. During all this time I attended a Party rally only once, just visiting one or two functions. Mass gatherings always caused me physical pain.
DR. SAUTER: Witness, did you receive the Golden Party Badge, after you became Minister for Economics?
FUNK: No; I received that when I was still press chief of the Reich government.
DR. SAUTER: You did not get it as Minister?
FUNK: No.
DR. SAUTER: How long were you a National Socialist deputy of the Reichstag?
FUNK: For just a few months.
DR. SAUTER: From when to when?
FUNK: From July 1932 to February 1933. I did not get another seat, because the Chairman of the Party, the chairman of the parliamentary group, Dr. Frick, informed me that, by a directive of the Fuehrer, only the old Party members would receive mandates; and I had received a state position in the meantime.
DR. SAUTER: Witness, in regard to the 1aws which are of particular importance in this Trial, such as the Enabling Act, which practically eliminated the Reichstag; the 1aw forbidding political parties; or the 1aw for the unity of Party and State- in respect to all these laws, which were in preparation for later developments, were you still a member of the Reichstag at that time or had you already ceased to be one?
FUNK: I was no longer a Reichstag deputy. But even so, I considered these laws necessary.
DR.SAUTER: That is another question. But you were no longer a Reichstag deputy?
FUNK: No; and I was not a member of the Cabinet, either.
DR.SAUTER: Dr. Funk, we have frequently seen and heard of an affidavit by the American Consul General, Messersmith, dated 28 August 1945, Document 1760-PS. He says in the passage which concerns you:
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"He had been the editor of one of the leading financial journals in Berlin before the Nazis came in and had very little open Nazi sympathy when they did come in." He goes on to say:
". . . later he became an ardent Nazi And one of their most effective instruments because of his undoubted capacities in various fields."
That is what the American Consul General, Messersmith, says about you. I should like to remind you of another passage from the book by Dr. Oestreich, which I have already mentioned and which has the title Walter Fun1c, A Life for Economy. That is 3505-PS, which has already been used and submitted in these proceedings.
In this book the author says that the assignments given to you by the Party, even if they covered a period of a few months only, might be regarded as particularly important.
What can you tell us about these two quotations?
FUNK: I have already stated that I declared myself for the Party and took up my Party work with enthusiasm. I was never attached to the propaganda organization, as has been asserted by Mr. Messersmith. I cannot remember that I ever knew Mr. Messersmith at all; nor do I remember discussing Austria with him, which he also asserts.
DR.SAUTER: Nor the Anschluss of Austria to Germany?
FUNK: I cannot remember that, although of course I considered the union of Germany and Austria necessary; but I do not recall discussing it with Mr. Messersmith.
As far as Dr. Paul Oestreich's book is concerned, I am sorry that the Prosecution has used this book as a source of information. Mistakes have arisen which could have been avoided and which I would not have to refute here now. Oestreich was a man who was quite outside the Party.
DR.SAUTER: What was he?
FUNK: He owned a German newspaper in Chile. and for some years he was political editor of the Berliner Borsenzeitung.
DR. SAUTER: Political editor?
FUNK: First of all, he naturally wanted to secure a market for his book; and for that reason he exaggerated the importance of my position in the Party. He may have thought that in this way he would do me a particular favor. In any case, as things have been described there, they are not correctly stated.
DR.SAUTER: Witness, in Document Number 3563-PS, submitted by the Prosecution, there is a statement to the effect that
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you, Dr. Funk, were described in several publications as Hitler's adviser on economic policy; and in another passage you are said to be Hitler's "Wirtschaftsbeauitragter" (Economic Plenipotentiary). Was this a Party office, or what precisely was meant by this term? What functions is it supposed to indicate?
FUNK: It was neither a Party office nor a Party title. The press frequently called me so on account of my activity on behalf of the Party in 1932, and it was obviously adopted by writers from the newspapers. But it was neither an office nor a title. It is really nonsense to consider my activities at that time so important; for if they had actually been of importance, I should certainly have retained these offices when the Party came to power.
The Reich Minister for Food and Agriculture was also a Reich letter; State Secretary Reinhardt, of the Finance Ministry, was the head of the Department for Financial Policy in the Reich Party Directorate (Reichsleitung), et cetera. But there never was a "Reichsleiter fur die Wirtschaft." When the Party came to power I left the Reichstag and all Party organizations.
DR. SAUTER: Dr. Funk, a Reich Economic Council of the Party-I repeat the term: Reich Economic Council of the Party- has been mentioned once or twice in the course of this Trial What do you know about your part in this Party organization and about the duties and domain of this Party organization?
FUNK: I had to think for a long time before I could remember this group at all, especially as neither Hess, Rosenberg, nor Frank remembered anything of the kind. But I remember dimly that Gottfried Feder had a circle of people whom he used to call in for consultation and to which he gave the rather pompous name of "Reich Economic Council of the Party." After the seizure of power this group ceased to exist. I never attended any of its sessions, and I was very much surprised to learn from the Indictment that I was supposed to have been the deputy chairman of this group. This group was of no importance whatsoever.
DR. SAUTER: You mentioned Gottfried Feder.
FUNK: He was responsible for the economic program and tenets of the Party from its establishment until it came to power.
DR.SAUTER: So he was the economic theorist of the Party from its foundation until it came to power?
FUNK: Yes. Dr. Wagner and Keppler overshadowed him later on. Keppler was always given the title of Economic Adviser to the Fuehrer in public.
DR. SAUTER: Dr. Funk, if I understood you correctly, the persons whom you mentioned just now are those whom you consider as the economic advisers of Hitler?
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FUNK: No, that is wrong.
DR.,SAUTER: Well?
FUNK: Hitler did not allow anyone to advise him, especially on economic matters. These were merely the men who dealt with problems of economic policy in the Party leadership, both before and after my time.
DR. SAUTER: Also from the publicity angle, like Gottfried Feder?
FUNK: He did a good deal of writing; he treated the problem of the lowering of the rate of interest, for example, in great detail.
DR. SAUTER: Dr. Funk, those were your real or supposed Party offices. Now I turn to your State offices. After the seizure of power-that is, at the end of January 1933-you became press chief under the Reich Government. In March 1933, when the Propaganda Ministry was created, that being a State Ministry, you became State Secretary in this Propaganda Ministry under Minister Goebbels. How did that come about?
FUNK: May I give a short summary of these matters?
DR. SAUTER: One moment . . .
FUNK: It would go much faster than asking each question separately.
DR. SAUTER: Then I would ask you to consider at the same time the question of why you entered the Propaganda Ministry and were made press chief of the Reich Government, although you were usually always occupied with economic questions.
FUNK: The Reich Marshal has already stated in his testimony; firstly, that he never knew that I had been active in the Party at all before 1933, and secondly, that, as he himself rightly believed, my appointment as press chief of the Reich Government came as a complete surprise. On 29 January 1933 the Fuehrer told me that he had no one among the old Party members who was intimately acquainted with the press and that he, therefore, wanted to ask me to take over the position of press chief, especially as this appointment involved regular reports to the Reich President. The Reich President knew me and, as I may mention again later on, very much liked me. I was often a guest at his home and was on friendly terms with his family.
DR. SAUTER: That is, Hindenburg?
FUNK: Yes, Hindenburg.
These were the reasons which prompted Hitler to make me press chief of the Reich Government. The press chief of the Reich
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Government was also a ministerial director in the Reich Chancellery, and I did not like the idea of suddenly becoming a civil servant, for I never had any ambitions in that direction. But I accepted the appointment, influenced by the general enthusiasm of that period and in obedience to the Fuehrer's summons.
I gave regular press reports to him, in the presence of Lammers. These conferences went on for a year and a half only, until the death of the Reich President, after which they stopped. The Fuehrer issued instructions to the press through the Reich press chief of the Party, Dr. Dietrich, who was later also made a State Secretary in the Propaganda Ministry.
When the Propaganda Ministry was founded the Fuehrer asked me to organize this ministry, so that Goebbels would not have to deal with problems of administration, organization, and finance. Then the Press Department of the Reich Government, of which I had so far been in charge, was incorporated in the Propaganda Ministry and placed under the direct control of Goebbels. It also had its own special chief.
From that time on-that is, after only 6 weeks activity as press chief of the Reich Government-my activities regarding the information and instruction of the press were at an end. From then on this was done by Goebbels himself, who generally drew a sharp line between the political and administrative tasks of the Ministry. He brought with him his old collaborators from the propaganda leadership of the Party to look after propaganda.
My services were not required for political propaganda. Goebbels took care of it through the Party organ, of which I was not a member. I had, for instance, as Chairman of the Supervisory Council, to be responsible for the finances of the German Broadcasting Corporation-a matter of a hundred million-but I never broadcasted propaganda speeches. Nor did I speak at any of the big State or Party rallies. Naturally, I fully appreciated the importance of propaganda for state leadership and admired the truly gifted manner in which Goebbels conducted his propaganda; but I myself played no part in active propaganda.
DR.SAUTER: Then, if I understood you correctly, your functions in the Propaganda Ministry, which was, of course, a state ministry, were of a purely administrative and organizational nature; and you left the actual propaganda to the Minister, Dr. Goebbels, and the people he brought into the Ministry from the Party propaganda instrument. Is that correct?
FUNK: Yes. Goebbels naturally claimed the exclusive right to dispose of all propaganda material. I did not appear beside him in the field of propaganda at all; and other considerable restrictions were imposed on my position as State Secretary by
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the fact that many assignments, looked after in other ministries by the State Secretary, were in this case taken care of by Goebbels' expert, Hahnke, who was later made State Secretary and Gauleiter.
DR. SAUTER: Hahnke?
FUNK: Yes. I do not believe that during the entire period of my activity in the Propaganda Ministry I signed even three times as Goebbels' deputy. One of these signatures has been nailed down by the Prosecution. It is a signature appended to an order for the execution of a directive and fixing the date on which it is to come into force.
DR.SAUTER: What kind of directive was that?
FUNK: The decree for the application of the law of the Reich Chamber of Culture. The Reich Cabinet decreed legislation in connection with the Reich Chamber of Culture. I was not a member of the Reich Cabinet; but as State Secretary to the Propaganda Ministry I was, of course, formally responsible, And naturally I promoted propaganda, as did everyone else who occupied a leading position in the official or the intellectual life of Germany. The entire cultural life of the nation was permeated with this propaganda in a measure appropriate to the overwhelming, fundamental significance which was rightly attached to propaganda in the National Socialist State.
DR.SAUTER: Dr. Funk, the Prosecution has held you responsible for laws decreed during your term of office as press chief of the Reichsregierung. I refer, for instance, to the laws submitted under Documents Number 2962-PS and 2963-PS. These are the laws well known to you and which concern the abolition of civil rights in Germany and the abolition of the parliamentary form of government. I ask you to explain, what did you have to do with these laws? Did you as press chief under the Reich Government have any influence on the contents and promulgation of these laws?
FUNK: No. This question has already been answered in the negative by both the Reich Marshal and Dr. Lammers. All I had to do was to pass on the contents of these laws to the press, tin accordance with instructions given to me by the Fuehrer.
DR.SAUTER: So you were surely present at the sessions of the Reich Cabinet...
FUNK: Yes.
DR. SAUTER: And you took note of the deliberations and resolutions of the Reich Cabinet...
FUNK: Yes.
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DR. SAUTER: That was the reason of your presence there; but your sole duty-and please tell me if I am correct-was to inform the press, after the cabinet sessions, of the decisions made? Is that correct? '
FUNK: Yes, that is correct.
DR.SAUTER: So you had no influence on the drafting or on the contents of the laws, nor on the voting? Is that right?
FUNK: Yes, that is right. I had neither a seat nor a vote in the Cabinet.
DR. SAUTER: Were you responsible for the press policy of the Reich Government-and I stress: the Reich Government and not the Party?
FUNK: I have already said that I received my instructions for the press from the Fuehrer; that went on for 6 weeks. Then Dr. Goebbels took charge of press policy. ..
DR. SAUTER: You have already said that the press reports to Reich President Von Hindenburg ended with his death in August 1934?
FUNK: Yes.
DR. SAUTER: And also, from the same date, your press reports to Hitler, who was then Reich Chancellor, is it not so?
FUNK: Yes, that is correct. Reich President Hindenburg had died in the meantime.
DR. SAUTER: And afterwards the Reich press chief, that is the Party official, Dr. Dietrich, tended more and more to occupy your place?
FUNK: Yes, Dr. Dietrich was one of the Fuehrer's closest collaborators; and through him the Fuehrer gave his instructions to the press.
DR. SAUTER: Dr. Funk, the book by Dr. Oestreich, 3505-PS, Exhibit USA-653, which we have already dealt with, contains the following quotation on your press policy; and I quote:
"Many of the journalists who worked in Berlin and the provinces are grateful to Funk for the way in which he attended to their wishes and their complaints, especially during the transition period.
"Funk is responsible for the much-quoted saying that the press must not be a 'barrel-organ,' with which he protested against the uniformity"-to use a German word, the onesided modeling and leveling-"of the press and demanded individuality for it. But he also protected the press from efforts made by various offices to 'grind their own ax....' "
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Is that correct?
FUNK: Yes; I probably did write that; and that was my opinion. So far as it lay within my power, I tried to protect the press from standardization and arbitrary treatment, especially at the hands of the government offices.
DR.SAUTER: You have already said, I believe, that you took no part in the political direction of the Propaganda Ministry-I stress, the political direction of the Propaganda Ministry-or in the actual work of propaganda. Is that correct?
FUNK: Yes, that is correct.
DR.SAUTER: Mr. President, I turn now to a new complex. Do you wish to have the recess now, Your Honor?
THE PRESIDENT: I think we will go straight on. We are going to adjourn at 12 o'clock.
DR.SAUTER: Witness, I come now to your attitude on the question of anti-Semitism. I do so because you are held more or less responsible, along with others, for the excesses committed against the Jews. Will you tell us on what principles your attitude was based?
FUNK: I was never anti-Semitic on the basis of racial principles. At first I thought that the anti-Semitic demands of the Party program were a matter of propaganda. At that time the Jews in many respects held a dominant position in widely different and important fields of German life; and I myself knew many very wise Jews who did not think that it was in the interest of the Jews that they should dominate cultural life, the legal profession, science, and commerce to the extent that they did at the time . . .
The people showed a tendency toward anti-Semitism at that time.
The Jews had a particularly strong influence on cultural life and their influence seemed to me particularly dangerous in this sphere because tendencies which I felt to be definitely un-German and inartistic appeared as a result of Jewish influence, especially in the domain of painting and music. The law concerning the Reich Chamber of Culture was created, radically excluding the Jews from German cultural life but with the possibility of making exceptions. I applied these exceptions whenever I was in a position to do so. The law, as I have stated, was decreed by the Reich Cabinet, which bears the responsibility for it. I was at that time not a member of the Cabinet. During the period of my activities in the Propaganda Ministry, I did what I could to help the Jews and other outsiders in cultural life.
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Everyone who knows me from my activities during that period can and must testify to that.
DR. SAUTER: I have submitted two affidavits in my document book, Documents Number Funk-1 and 2. The first was made by the editor of the Frankfurter Zeitung, Albert Oeser; and the second by a lawyer, Dr. Roesen. I ask you to take judicial notice of both these documents. The first affidavit proves that the Defendant Funk took a great deal of trouble to protect the interests of the above-mentioned Albert Oeser, the editor of the Frankfurter Zeitung, and those of a number of the staff of this newspaper, although by doing so he was endangering his own position. In particular, he persisted in retaining members of the staff who were not of Aryan descent and who, therefore, in accordance with the intentions of the Party, should no longer have been employed.
FUNK: It was not in accordance with the intentions of the Party, but in accordance with the law passed for the Chamber of Culture that they were no longer to be employed.
DR. SAUTER: In accordance with the law passed for the Chamber of Culture, also.
Then Document Number 2 of the document book, an affidavit made by Dr. Roesen, who confirms that the Defendant Funk also intervened, for instance, on behalf of the family of the composer, Dr. Richard Strauss, and his non-Aryan grandchildren and by so doing incurred certain personal danger. These are just a few examples; but the defendant can probably tell you of other cases in which he looked after people's interests.
THE PRESIDENT: What exhibit number are you offering those as?
DR. SAUTER: Numbers Funk-1 and 2 in the document book. I have submitted the originals.
THE PRESIDENT: 1 and 2?
DR.SAUTER: 1 and 2.
[Turning to the defendant.] Dr. Funk, I have just said that perhaps you could-quite briefly-give us some more examples of cases where you used your official position to protect intellectuals and artists, whose views had got them into difficulties.
FUNK: Richard Strauss is a special case. That most remarkable living composer found himself in great difficulties on account of a libretto written by the Jew, Stefan Zweig.
I succeeded in having Richard Strauss again received by the Fuehrer, and the whole affair was dismissed.
Dr. Wilhelm Furtwangler found himself in similar difficulties because he wrote an article praising the composer Hindemith;
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and composers with Jewish wives, such as Lehar, Kunnecke, and others who were always in difficulties because of their efforts to evade the ban placed on the performance of their works. I always succeeded in getting permission for these composers to have their works performed.
THE PRESIDENT: The defendant can say that he helped hundreds of Jews, but that does not really destroy the fact that he may have acted hostilely by signing decrees against the Jewish race his helping a few Jewish friends. Anyhow, I do not think that it need be gone into any detail
DR. SAUTER: We are of the opinion, Mr. President, that in order to judge the character and personality of the defendant, it may be important to know whether he signed decrees which were in any way anti-Semitic because as an official he considered himself bound by his oath to carry out the law of the land, or whether he signed them because he himself was an anti-Semite who wished to persecute Jewish citizens and to deprive them of their rights, and for this reason only...
THE PRESIDENT: Dr. Sauter, the Tribunal thinks that you have made the point quite clearly that he helped Jewish friends, but it isn't a question which need be gone into in detail.
DR. SAUTER: I come now, in any case, Mr. President, to another point. I want to ask the defendant how his activities in the Propaganda Ministry developed in later years.
FUNK: In exactly the same direction that I have described here. By degrees I came to be in charge of a large cultural economic concern-film companies, broadcasting corporations, theaters. I was director and chairman of the supervisory board of the Philharmonic Orchestra and on the Council of German Economy, which dealt collectively with the economic activities in the entire economic field at home and abroad with the active participation of the economy itself. Those were the main parts of my work.
DR. SAUTER: Witness, the Prosecution has submitted under Document Number 3501-PS an affidavit by the former Reich chief of the press-I believe-Max Amann, in regard to your activities in the Propaganda Ministry. I want to refer to this now. In that affidavit, we find the statement that Dr. Funk-and I quote literally:
". . . was to all intents and purposes Minister in the Propaganda Ministry..."-And it says further on-and I quote again-"Funk exercised complete control over all means of expression in Germany: press, theater, radio, and music."
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Now, I ask you to comment on that; but you can do so quite briefly because I have already submitted an affidavit by Max Amann to the contrary to which I will refer later.
FUNK: Amann knew the Ministry only from the outside; and, therefore, he had no exact knowledge of its internal affairs. My work was done in the manner I have described. It is completely absurd to assert that under a Minister such as Dr. Goebbels the Ministry could have been led by someone else who was not the Minister.
Dr. Goebbels assumed such exclusive and all-embracing functions in the field, of propaganda that he dwarfed everyone else.
DR. SAUTER: Mr. President, I have submitted an affidavit by that same former Reichsleiter Amann, dealing with the same subject, in the appendix to the Funk Document Book, under Document Number Funk-l that will be Exhibit Number 3-and I ask you to take judicial notice of this affidavit. I do not think I have to read it. I administered that affidavit in the presence of and with the co-operation of a member of the Prosecution. The essential part of this affidavit of 17 April 1946 is that Reichsleiter Max Amann also admits that Funk had nothing to do with propaganda as such. That is to say, he did no broadcasting and indulged in no propaganda speeches but was mainly concerned with the organization and administration of the Ministry. Now, Mr. President, I come to the defendant's position as Reich Minister of Economics.
[Turning to the defendant.] Dr. Funk, you were State Secretary in the Propaganda Ministry until 1937. At the end of November 1937 you became Reich Minister of Economics, after your predecessor, Dr. Schacht, had left that post. Can you tell us with the necessary brevity-of course-how that change took place and why you were called to that post?
FUNK: That took me completely by surprise, too. During a performance at the opera, the Fuehrer, who was present, took me aside in the vestibule during an interval and told me that the differences between Schacht and Goering could no longer be bridged and that he was therefore compelled to dismiss Schacht from his office as Minister of Economics and was asking me to take over the post of Minister of Economics, as he was very well acquainted with my knowledge and experience in the field of economics. He also asked me to contact Reich Marshal Goering who would explain everything else.
That was the only conversation which I had with the Fuehrer on the subject.
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DR. SAUTER: And then you spoke to Goering himself? Will you tell us about that?
FUNK:-Then I went to the Reich Marshal who told me that he had really only intended to put a state secretary in charge of the Reich Ministry of Economics but that later he decided that the extensive machinery of the Four Year Plan should be merged with the machinery of the Ministry of Economics. However, the minister would have to work in accordance with his directives and in particular the plenipotentiaries for the individual decisive branches of economy would be maintained and would receive their directives directly from the Delegate for the Four Year Plan. In order to proceed with the necessary reorganization, the Reich Marshal himself took over the direction of the Reich Economic Ministry; and in February 1938 he transferred it to me.
DR. SAUTER: So Goering himself was to all intents and purposes the head of the Reich Ministry for Economics for a period of about 3 months.
FUNK: The reorganization was effected under his control. The control of economic policy was in his hands then as well as later.
The main control offices under the Four Year Plan were maintained; for instance, the Foreign Currency Control Office, which gave directives to the Reichsbank; there was the Food Control Office, which gave directives to the Food end agriculture Ministry; the Allocation of Labor Control Office, which gave directives to the Labor Ministry; and also the plenipotentiaries for the separate branches of economics: coal, iron, chemicals, et cetera, which were under the direct control of the Delegate for the Four Year Plan. Some offices were also transferred in this way to the Ministry of Economics from the Four Year Plan, which continued to function quite independently. They included the Reich Office for Economic Development and Research, which was under the direction of Professor Strauch, and the Reich Office for Soil Research, directed by State Secretary Kempner, mentioned here in connection with Slovakia and Austria.
I tried to restore the independence of these offices. I am still in ignorance of what these offices did. In any case, they thought themselves responsible to the Four Year Plan rather than to the Minister of Economy.
DR.SAUTER: Dr. Funk, the essential point of what you have just said seems to me to be that you received the title of minister but that in reality you were not a minister, but might have had the position of a state secretary and that your so-called Ministry of Economics was completely subordinated to the directives of the
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Four Year Plan-your Codefendant Goering in other words-and was compelled to follow these directives.
Did I understand it correctly?
FUNK: The latter point is correct. The Reich Marshal has clearly expressed and confirmed that here. But the first statement is not correct because formally, at least, I held the position of minister, which involved a gigantic administrative domain to which the Reich Marshal, of course, could not pay attention. The very purpose of the reorganization was that the Reich Marshal reserved for himself the direction and control of economic policy in the most important and decisive matters and gave me corresponding directives, but the execution of these was naturally in the hands of the Ministry and its organizations. But it is true that the position of minister, in the usual meaning of the term, did not exist. There was, so to speak, a higher ministry. But that has happened to me all my life. I arrived at the threshold, so to speak; but I was never permitted to cross it.
DR. SAUTER: That is not the case as far as this Trial is concerned.
Dr. Funk, the Prosecution asserts that, although you were not really a minister with the usual responsibility and independence of a minister, you, as Dr. Funk, Reich Economic Minister, still exercised supervision over those parts of the German economy which were grouped under war and armaments industry, that is, in particular, raw materials and manufactured materials as well as mining, the iron industry, power stations, handicrafts, finance and credit, foreign trade and foreign currency. I refer you, Dr. Funk, to the statements on Page 22 of the German translation of the trial brief, which I discussed with you several days ago.
FUNK: That is formally correct. But I have already explained how matters really were. I had nothing to do with the armament industry. The armament industry was at first under the High Command of the Armed Forces, under the Chief of the Armament Office, General Thomas, who was a member of Schacht's conspiracy, of which we have heard here. The Armament Minister Tort, who was appointed in 1940, at once took over from me the entire power economy; and later on I turned over all the civilian production to Armament Minister Speer.
DR. SAUTER: What do you mean by civilian production?
FUNK: Coal, chemicals, consumer, and other goods. The main production branches in that field already mentioned here were, as I said before, under the Delegate for the Four Year Plan. Thus it came about that the Ministry of Economics gradually became a new
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Ministry of Commerce, which dealt only with the distribution of consumer goods.
DR. SAUTER: Mr. President, perhaps we might let him go on for a few seconds longer; because I would then come in a second to the subject of the Reichsbank President.
THE PRESIDENT: Certainly.
DR. SAUTER: Will you please continue briefly? You stopped. I believe you wanted to say more about manpower, gold, and foreign currency-about the competent authorities there.
FUNK: The Foreign Currency Control Office under the Four Year Plan was the competent authority for that; and the Reichsbank had to act in accordance with its directives-in my time, at least.
DR.SAUTER: And the direction of foreign trade?
FUNK: That was in the hands of the Foreign Office. The Minister for Foreign Affairs obstinately laid claim to that.
DR. SAUTER: And what did the Ministry of Economics do?
FUNK: The Ministry of Economics and the Reichsbank attended to the technical execution in this sphere, that is, the technical execution of clearing agreements, balances, et cetera.
DR. SAUTER: Mr. President, I come now to a separate theme. I should like now to discuss his position as President of the Reich bank. I believe it might be a good moment to adjourn.
THE PRESIDENT: The Court will adjourn.
The Tribunal adjourned until 6 May 1946 at 1000 hours.7
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