12**5 AMSKICAN COKSOLATS OEfflSRAI, Sarlif*$ Sarsnany, lay ftj 1933*

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1 ,u 12**5 AMSKICAN COKSOLATS OEfflSRAI, Sarlif*$ Sarsnany, lay ftj 1933* 5OBJECTt THE HONORABLE tlnaartainty a to dovalopaaant* In tha /. aaonojrle and flaamsiai attestation in Uaraiatry* THK SECRETARY OW STATE WASKIRGTOlt SIR i I hava tha honor t rofor to -my dea^afeah So* 1258 of In *hleh 1 lnfajrraad tha fca.-art^ar.t that, all th information whiah was availahla to tha Consul**** Gena»l tssdicatad that tha lea-dor a -sf tha Sational* Socialist party end of tha prosont CSovarnmant In 3 rs«??y had no definite aa<*»o»i and financial pro^raa, bat that thay wo.ro drifting with tha tida homing that favorahla davaloj^manta la tha -Internal and axtarnal litnation sight b aalsai f* tlssa to titm to aafciafy tha raagaoii to wham «u«h varying and axtravagant oroailaaa hava hoan mada. Tha muah haraldal ar-aach of tha Cha«ealIor OR May 1 # In whloh tha! *$ awaltad aaononiie pra^ts of tha Ckrvornstant and of tha i?arty»aa to ho aanounaad» again aontainad nothing now as ha«alroady haa* raportat! to tha Da*,artaant by tha ikbaisey aod by th!» Consul! 3 -'oral In it d»patch So* 1898 of lay 9» 19S3» Th ra at Indlaatlona atnsln** to u«constants y In tsar eonarat four to tha affact that V not

2 not only does the Government not have a program, but that Individual effort by the masses, trade organizations and all sorts of organized groups is endeavoring to force action on the Government of a radical nature which the leaders of the party, now grown more moderate, do not wish to see carried through. The outstanding development of the last few weeks in the German situation has been that the leaders of the party, which is merely another way of saying those in control of the Government, have grown more moderate, while the secondary leaders of the masses have if anything grown more radical. Of the primary leaders the Chancellor, Mr. Hitler, and Minister Goering have undoubtedly grown more moderate and are to a certain extent appalled by the pressure which is coming to them from the bottom to do various things which, they know involve not only economic ruin for the country, but political ruin for the party. Dr. Goebbels, the Minister of Propaganda, has been more impervious to moderating influences and remains of the three primary leaders the one who is definitely radical and reactionary. There is reason to believe that the Chancellor and Minister Goering have come to a realization that not only great mistakes have been made already but that grave mistakes equally dangerous may again be made. One of the immediate associates of Minister Goering stated to me recently: "We know that we have done very foolish things and we know that we cannot afford to do any more of them.* He was referring to the mistakes which had been made in the

3 «NSN» tine persecution of the Jowe and wee assuring e that the treaty obligations of Qmwmnj with regard to the protection of foreign buslassfi a**d capital would lr# carried throat la sptte of the difficulties ceasing from the bottom in this connection* In G#&mr to understand the present situation In uermn.y one must realise that while the higher loaders of tli party have abs^l^to and complete control of the Govoriment and of the country* they are not la a position to for certain decisions w?ileh are contrary to the wishes and the will of the assesses and the interned!cry loader a* Tbay aretoolag haunted ev#.ry day toy the /^^ of tha pro»leea which they made a. the 'leaders of ft party which w g endeavoring to secure power* Iff they aro being asked to s&eet the** promises* fust as in th beginning* that la isssed lately after March & 9 every individual laembor of th Sstlewal-Eocisllct party wh^ had a grievance against a neighbor or ft competitor or a privet, grudge of airy kind triad to work it oat by having physical injury or i*apriwon»ea%- Inflicted on s^ch persons through the party organlaation, to now very business sura* every art let* every profess lonal ssan* every trade organisation with grievances is trying to carry out its own little revolution ysn&er the protection of tb«**national* revelation-, there Is mmh, reason to believe that Messrs* 8'ltler and (Jeering are seriously disturbed over this* At first th " wsre in complete sympathy with their nsny sdherents and wished to let the have an opportunity to work out t'wir grievances* as th days have

4 -4 have gone em they h*v* realltad what lape«ible situations this is bringing about and how it 1 definitely prejudicing the eeoao&lc and politic*! situation In Germany, but wane we nay accept this to be trae I as forced to the conclusion that It is equally true that they do n-.it feel themselves able to fore noy decisions on their people tlllel will be a further disappointment to thosu the Chancellor la aware that the onfcaide»?w is considerably dlatorhad concerning th* plait of the Government* and. has therefore on several occasion ta&en tha opportunity to state that viersseny desire nothing more tnan peace* Is an Interview which ha gai?*» recently let Sari la. t kir John Pester, ehieh- h*«x as sore already been reported to tha Department* ha endeavored to give reassuring declarations* flfi rsae la CJersarsy tfe want through th* war wishes to go through this ext»riene# again..* is hopes that th revision of tha?raaty of Verse11la %ay fee reached through peaceful»eaiaa* ffce th -?ght of an overseas eatoaaaion of Gfamany has haaa give* up* tsormany does not wish to engage la a contest on fehe see with England* fne fata of Germany does not da-pond en colonies and dominions, but on her Eastern frontier * barge fortunes asoat disappear end unearned incomes tsaat h a at ***** In the fufc-jre there. will only he an aristocracy of labor* llork lessors v*inabl# than property. Svery yomg mmn irrespective of hie birth asuat spend «year In the compulsory labor eesp* Among Seraene all difference of claaeaa will be eliminated* The demoralising eye test of aid to the iniemployad

5 »&<» 'unemployed watt h&ve a» end end ssaefc tee eubafcittited by earned wagee Tbm Chancellor'a fcafcencafc with reepeet to Qwrmany'ss future not depending on col en lee or dominions* which wan interpreted in owe new&oapere to the effect that &erw*ny had no f«fc»re interest In colonies* mm% have caused g?e&t concern to certain giessbers of the party* f-0? 1 on the. days fol lowing the publication of the interview corrections appeared In ill press to the of feet fe'aat the Chancellor's state* *seats were not to be interpreted to tuesri that GersAny had a» Interest la colonies* bat rather that the Chancellor had ecayred Sir John Fester that Germany "would respect the oversea possessions of.i&glftnd*** The Chancellor's statement that large forties tntst disappear and that uaeetrned income* stist be cat down la one of the most direct atateaenta which he has tsftde a lace larch 5 showing the highly socialistic arai radical character of the real alas of the party. St» first declaration of the radical policies of the party wa«made by Minister -Goeriag in a speech alroady reporter! fco the Department* In which he said that In the rest too snwh emphasis had been placed on the purely national character of the 3fational8 eiati*sfc party and that he wished to emphasise te* see lei let character of Its i?reg,ra» He endeavored to distinguish between the social!at ate of ttiw present Government.la contradistinction to the rasrxsaie policies of the Social- Democratic

6 S ial*;>»»ocratl«partj pr&ri^aaly # powerful In Gertfsany and which the present overrent Is to ff ettt*ly loins oafc* the develapeteats* however* are ahsmlng steadily that the present 9->verBs$ent and the actional Social 1st party are more radical in their policies and aiw than any Socialist movement in Germany ha a heretofore dared to toe* I think it may h taken for granted that the present C*ov»ri«8 r*t and the party mm definitely aijfeibsfc large fortunes sod jmcerned ineojss, and almost any step in this direction isay he expected, la s speech held on May 4 by Obersrse* a'dent Bruckner af lower Slloeia at the opening of as agricultural machinery exhibition in Brealau he mad the definite statement that the large landed ftatatas Xxi. Qerssany mm% disappear* Be aald that by 1&60 all such larg estates would have diasp? eared in #er»?any» In pre vie-.* d «peteh e I have aad«it clear that th Government is definitely against big business* larg department stores* chain stores sm oneiric store «He now have the Chancellor* mt& that ^at larg fortunes remain la Serrmnv matt dieappear* and that unearned ineoises *»ust be greatly cut* While the declaration ofith regard to the disappearance of larg landed properties was Bade toy a secondary leader ia Silesia it is OR open secret that the cutting up of the large estates is a definite par% of the progress of who national* Socialist aovemeat* Of this ss^eeif however* little ha been said as th $ational» eeia2i»t party haa had s>iae of its strong g«-»pe>rt from Saet Prussia where

7 0m where t%* divlelon of $he*e eetatee would a*e$*se general antagonize* The Depertisent sm o«r people at hessa ntiat foe prepared for etarfcli'g aeonaetie detielopwente In Gensany for It 1 increasin&iy evident that the rea!j>r gra» ef tfe Befeieni&»SociaXi8fe party It highly radical and in many re»'a«et«ts no different frea* that placed* In *tl*ml fey the Corwianiet r#gte In lueala. That la many ways the higher Isadora* of the party wowxd like to moderate tlits py# pp«is t is* clear} tbat the ssacsoa e&d the inter?*s4i«iry leaders are jaafc at radical ae before and show no moderating tendency is equely clear* the great *ni&mxv?0tmlnti ae to hmt far the ere.moderating leaders at the tor can Influence the intermediary leader a and tine isaa^ee, or how far the radical bottom will influence the tap* cannot close one's eye«to the fact that, the movement is definitely towards radical smaanaree* One need only read the declarative of ne«like Dr. von, Rentelne, the new leader of the Heicheatand dee KMtutechen Handel** as pablianed in the "Berliner fagefolatt*. morning ia»«e of May It ie he who afc**nde between the Oevernraent arsd the variona trad organisations and indue trial organ! cat ions wh'eh have been recently placed completely «Mef 5etlonel«8oelallat domination* The intensely nationalletic and aocialietlc alma of >** von Hentclna era quite clear and unless he had the confidence of the higher leader«of the party he

8 he would sat hare b«en plaeed In this key position. s& situation %#**«t y It fall of anomallee* Xmed lately following the &Mn*el2e *e declaration that large Iortunee resist disappear and that oaearned Ineojsei? must b out* tereediately following the deetar«tion of various organisation* that the large department stores and Simla stores putt be gradually ellfislnsiess, elosely upon the aetion of various organtsatlorn e*llin& for legislation whleh would p«t oat of business sosae off the Isedlng export house* of Oereseny* end prsetleeiiw following the stete&ent already referred to thet the large estates mast be eot up» there eppeared an fcey 9 in preetleaily all of the aawe» papers throughout Germany a statement headed "Authoritative i>eelaration # All Interferon * in Business «tu*t be Stopped * The declsratl-sn Is resists is briefly te the following of feet? flaw German Government heeee interest thet business shall be definitely and honestly tranquiliieed* All rigorous Interfere now will haft to stop sad will be stepped so that bus ins ss shall be In the position it sake plena for the fitter and the neeessaj* stability wmeh it seeds be guarantee! to It* Bnaineew wen teegin to plan In a big way for the future-* 1%-:* who begin quickly will find the wuraest eseral op port fron the Severnpent* It Is altogether oat of ateord with tins $evero»* ><t, e ideas IX in business»ad business. elrolee any nervousness still prove!; * low that the asovossent against the trad union has h*mn carried through th > life of b sines eon be properly consolidate*! and hueinee* ear. work on the basis of e definite end clear future * The eery fact tfeet it was neeeesery for the,,- Qwveratent to issue en euthoritetlve deelaretloa thet business

9 eneineaa wag t fee mtdl % orbed la stiff i client te Indicate the oneertaiisty mhi«ii exiata in buslneaiu fhla dealara» ilen e.f the 3*&werr»Mmt will in s» way o,utat b-aineae beeatia ev#»fcfe-3e in the party itaelf «r# n$t r <» aaim»eja % it* These dee1 Bratiena h»**e pr f «i» far t be stere werda and every day there Is? farther eetion which t«?wsa to make baeineee uncertain and. afraldfe In several detpatehee I have staled that it is igtp^ttitele for anyeae hare in Oarasany to indicate what ' deval --'psant will be and ah at the future haia is store, fa the ^toii-nd that the?s n who are leading the Oevemjaent 4o net tbefbaelvea know whet they are gelng to do and that tfcelr para siall ilea and naraaters ar# each that they are enpafel if the meat unexpected aetiena* The development which teaira telcer? pl«c«tinea theae dcapctchea were written clearly Sad.leata th«f thia it tf*t# The aittlen in jastfe as uncertain now a«it was a. month «g«# " rewrote has bear, mad»ly In cm direction # that it can n # be definitely aid that,. tfclssovernaeat! fed? eel and highly cejeia? latle in ifca a.lr» am that the seat «?-> expected ac^aoisie use aa urea -*n«y b taken«it la new quite e3ear tnat it is the most extremely national, aovernnent wfcith mm can conceive f and that although it deairec very aarnaatly peace far the next fewyeara in order to eenitelidat* Its petition* there is on the ether hand very reason te toeilewt that enee the eoneollda* fcion is achieved "the new Germany* will etrivt In every way & it will en. the reat of the world* With a e-twitry

10 eeaatry with, woe!} highly natlonelieiic «a& e poorly fmw«ft.l«s Riliter1stie aims afd whieh 1* eoatew.-lsting putting inta Tfeet in &a«iaay an ecoa'raie e ys teetotal ly oat of aeeord with the eeoao&ie aysiesss prevail* ia.g assoas its neighbors In,.Europe and oversea, it l» impossible for the rent of the world to disowns <!!# srr«aste&t» quality of arssagaeata or any fs-rmn of eommerei*! faer aeoaaaie agreement, fhe ^reseat wutam yov-arnesent by its aetlms every day 1 f&aeiag itself in a position whare aueh matters caanot be discussed with it by ether natioa** It tmj he eventuaiiy timt the leader* of the aovernment and of the party will k»»w what they eea do mml what they cannot de» but for the present any discission with thess Is useless, heeau.se it la diseasing with people ^ha do aot thenselves know what they really wish to do or what they can do* la the course of a few oaths the situation say have to a eertela extent crystallised asi the actual coarse of avent* here say he sore definitely foresees, Yher# is so dictatorship as is so easwseniy assessed either of wm or of fchrac) individual** The masses are for the.eewest the dictator ia Germasy* end the??arty leaders are merely their spokeetsea. 'fhej are wery radically ia disagrcesenfe with mmh that the masses want, but fo» the ttopmnt and probably t^t mm tliae still they wil Ret he able to take mnj real action contrary to the will of the acesc** Eespaetf hily yours. 800 OSfttHP