Walter Funk 1

August 18, 1890: Walter Emanuel Funk is born into a merchant family in Danzkehmen, East Prussia.

1916: Funk joins the infantry but is discharged as unfit for service due to "a bladder ailment."

1919: Funk weds Luise Schmidt-Sieben.

1920: Funk goes to work for Alfred Hugenberg's financial newspaper, the Berliner Borsenzeitung, as editor-in-chief.

From Funk's IMT testimony: The tendency of the paper was somewhere between the Center and the Right. The newspaper was not tied to any party. An old Berlin family of publishers owned it. [On the Jewish Question I was] absolutely neutral. It [the Berliner Borsenzeitung] did not deal in any way with the Jewish question. I had a lot to do with Jews. That was in the nature of my profession. Every day at the stock exchange I was together with 4,000 Jews.

Note: The source for most items is the evidence presented to the International Military Tribunal (IMT) at the first Nuremberg Trial, between November 21, 1945 and October 1, 1946. As always, these excerpts from trial testimony should not necessarily be mistaken for fact. It should be kept in mind that they are the sometimes-desperate statements of hard-pressed defendants seeking to avoid culpability and shift responsibility from charges that—should they be found guilty—could possibly be punishable by death.

February 24, 1920: The 25 Points of the NSDAP Program, composed by Adolf Hitler and Anton Drexler, are publicly presented.

From Funk's IMT testimony: 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.

May 1921: The "London ultimatum" demands reparations in gold or foreign currency to be paid in annual installments of 2,000,000,000 (2 billion) Gold Marks plus 26 percent of the value of Germany's exports. The first payment will be paid when due in August 1921. This is the beginning of an increasingly rapid devaluation of the Mark, which will fall to less than one third of a cent by November 1921. The total reparations demanded is 132,000,000,000 (132 billion) Gold Marks which is far more than the total German gold or foreign exchange.

December 1922: Poincaré writes to the French ambassador in London:

Judging others by themselves, the English, who are blinded by their loyalty, have always thought that the Germans did not abide by their pledges inscribed in the Versailles Treaty because they had not frankly agreed to them. ... We, on the contrary, believe that if Germany, far from making the slightest effort to carry out the treaty of peace, has always tried to escape her obligations, it is because until now she has not been convinced of her defeat . . . . We are also certain that Germany, as a nation, resigns herself to keep her pledged word only under the impact of necessity.

January 11, 1923: The French, under Poincaré, occupy the Ruhr to extract the reparations payments from Germany, and to maintain the sanctity of the Versailles treaty

April 20, 1923: Streicher founds, and becomes editor of, the racist newspaper Der Stuermer (The Stormer), subtitled: "A German Weekly in The Struggle for Truth."

November 9, 1923: The Beer Hall Putsch (also known as the Munich Putsch, but in German referred to as the Hitlerputsch or the Hitler-Ludendorff-Putsch), a failed attempt at revolution by Hitler occurs. 100 soldiers open fire on Hitler and his companions as the march through Munich. Four state police officers and 16 Nazis will lose their lives. Hitler will subsequently stand trial, and be convicted, for treason and spend 6 months in jail. This is the origin of the Blutfahne (blood-flag), and will be commemorated on this day annually as a Nazi holiday.

[For a detailed and documented account see, The Hitler Putsch.]

From Funk's IMT testimony: I do not know whether I received invitations [to the Putsch commemorations]; 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.

May 1924: In the German Federal election, the Nazis receive 1,918,300 votes. 6.5% of the electorate vote for Hitler's party, giving him 32 seats in the Reichstag.

December 1924: In the German Federal election, the Nazis receive 907,300 votes. 3.0% of the electorate vote for Hitler's party, giving him 14 seats in the Reichstag.

May 1928: In the German Federal election, the Nazis receive 810,100 votes. 2.6% of the electorate vote for Hitler's party, giving him 12 seats in the Reichstag.

September 1928: 650,000 German workers are officially unemployed.

April 16, 1929: The president of the Reichsbank, Hjalmar Schacht, speaks at the Paris conference in connection with reparations:

Germany can, as a whole pay, only if the Corridor and Upper Silesia will be handed back to Germany from Polish possession and if, besides, somewhere on the earth, colonial territory will be made available to Germany.

From Funk's IMT testimony: 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) 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 Lebensproblem) 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 Baghdad 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.

Lebensproblem) 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 that 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.

September 1929: 1,320,000 German workers are officially unemployed.

October 1929: An economic Crash on Wall Street begins the Great Depression.

September 1930: 3,000,000 German workers are officially unemployed.

September 1930: In the German Federal election, the Nazis receive 6,409,600 votes. 18.3% of the electorate vote for Hitler's party, giving him 107 seats in the Reichstag.

Early 1931: Funk meets Hitler for the first time.

From Funk's IMT testimony: Gregor Strasser ... arranged my first meeting with Hitler. Not until much later, in Berlin, did I meet Hermann Göring. Apart from them I had very few acquaintances in the Party at that time and played no role in it myself.

My first conversation with Adolf Hitler was very reserved. That was not surprising as I came from a world that 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 Führer 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."

A certain Dr. Wagner directed the economic policy section of the Reich Party Directorate. I was not invited to political talks. A close connection with the Fuehrer—or a closer connection with the Führer—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 Führer 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 Führer 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.

Summer 1931: Funk, described by William Shirer as a "greasy, shifty-eyed, paunchy little man" with a face that would look natural "on a frog," gives up a lucrative job as editor of the Berliner Borsenzeitung, and joins the Nazi Party (under the sponsorship of Gregor Strasser, to whom he becomes financial advisor). Funk becomes a vital contact man between the party and a number of important business leaders. On the basis of his past work his personal relations to the German economic leaders are broad and far-reaching. He is now able to enlist them in the service of Hitler and not only to answer their questions authoritatively but to convince them and win their backing for the Party. (Shirer)

From Funk's IMT testimony: [I resigned as editor in chief of the Berliner Borsenzeitung because] I was convinced that the National Socialist Party would come to power in the Government, and I felt called upon to make my own political and economic opinions heard in the Party.

The German nation at that time was in sore distress, spiritually as well as materially. The people were torn by Party and class struggle. The Government, or rather the governments, had no authority. The parliamentary system was played out, and I myself, for 10 or 12 years before that, had protested and fought publicly against the burden of the Versailles reparations, because I was convinced that those reparations were the chief cause of the economic bankruptcy of Germany. I, myself, have fought all my life for private enterprise, because I was convinced that the idea of private enterprise is indissoluble [and] bound up with the idea of the efficiency and worth of individual human beings. I have fought for the free initiative of the entrepreneur, free competition, and, at that time in particular, for putting an end to the mad class struggle, and for the establishment of a social community on the basis of the industrial community. All those were ideas to which I found a ready response in my conversations, particularly, with Gregor Strasser. Gregor Strasser at that time was leader of the Reich Organization Office of the National Socialist Party and was generally considered to be the second man after Adolf Hitler.

June 20, 1931: Realizing that Austria and Germany are on the brink of financial collapse, U.S. President Herbert Hoover proposes a one-year world moratorium on reparations and inter-governmental debt payments. Britain quickly accepts this proposal, but Premier André Tardieu of France meets it with stiff resistance and seventeen days of delay. During this delay the situation in Germany as well as renewed fears of hyperinflation result in a countrywide bank run, draining some $300,000,000. As a result, all German banks have to close temporarily.

From Funk's IMT testimony: 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 Reichsmarks 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.

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 Führer 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.

September 1931: 4,350,000 German workers are officially unemployed.

From Funk's IMT testimony: 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 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.

July 1932: In the German Federal election, the Nazis receive 13,745,800 votes. 37.4% of the electorate vote for Hitler's party, giving him 230 seats. Funk is elected a Reichstag deputy.

From Funk's IMT testimony: [I was a National Socialist deputy of the Reichstag] for just a few months. 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 Führer, only the old Party members would receive mandates; and I had received a state position in the meantime . . . .

In 1932, and this is the only year which we need consider in connection with Party activities on my part, because I was not active in the Party before or after this year. I did arrange discussions between Hitler and leading men of industry, whom I can name. But other men also acted in that capacity; for example, State Secretary Keppler.

1932: Funk becomes a member of the Reich Economic Council of the Party.

From Funk's IMT testimony: 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.

[Gottfried Feder] was responsible for the economic program and tenets of the Party from its establishment until it came to power. Dr. Wagner and Keppler overshadowed him later on. Keppler was always given the title of Economic Adviser to the Fuehrer in public. 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. [Gottfried Feder] did a good deal of writing; he treated the problem of the lowering of the rate of interest, for example, in great detail.

From Göring's IMT testimony: Before the seizure of power I was acquainted only with Funk's activity as editor of the [Berliner] Borsenzeitung, which I have already mentioned. And as such I heard him repeatedly mentioned in economic circles. Only after the seizure did I hear at all of Funk's having been in the Party and of his relationship with it. Thus, his Party activity could not have been of such tremendous significance or he would have come to my attention in some way. So far as his information service is concerned, whether he favored the Democrats or the People's Party, I know nothing about that.

September 1932: 5,102,000 German workers are officially unemployed.

November 1932: In the German Federal election, the Nazis receive 11,737,000 votes. 33.1% of the electorate vote for Hitler's party, giving him 196 seats in the Reichstag.

December 1932: Funk becomes chairman of the Committee on Economic Policy of the Nazi Party.

From Funk's IMT testimony: 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 [Walter Funk, A Life for Economy by Dr. Paul Oestreich] from which the Prosecution has taken various bits of information. Well, at that time I was not yet a National Socialist or, at least, but quite a young member of the Party. [Note: Funk had been a Nazi since mid-1931.]

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. 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 Göring. Even during the war, he had parts of the Hermann Göring 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 Führer 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 Führer turned so sharply against the bourgeois world for that meant practically that the whole of my life's work had failed . . . .

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 (Amt fur Privatwirtschaft). 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 . . . .

It [Chairman of the Committee on Economic Policy of the Nazi Party] 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.

January 1933: 6,100,000 German workers are officially unemployed.

From Funk's IMT testimony: 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 [but instead] by methods which I would have to explain. But in any event, armament never came into question then. First of all, opportunities to work were offered everywhere so to speaks It was imperative to set up a large-scale road-building 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. 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.

January 31, 1933: Adolf Hitler becomes Chancellor of Germany. [See, Hitler’s Rise To Power.]

From Göring's IMT testimony: I am well acquainted with the circumstances of Funk's appointment as Reich Press Chief. After the Reich Cabinet had been sworn in, the new Reich Press Chief was to be appointed. We were in a room of the Kaiserhof Hotel, and the Führer did not want anyone from the press organization who was a full Party member, but someone who had had some previous press experience yet had not been so prominent in the Party or bound to it. I do not know exactly who mentioned the name of Funk. But I do know that he then said, "Good!" Funk was summoned, and I believe that it was a great surprise for him. I had that impression. The Reich Press Chief had at the time, when Hindenburg was still Reich President. The Reich Press Chief had no influence of any sort on the decisions of the Reich Cabinet, for his task was of a different nature.

From Funk's IMT testimony: 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 Führer 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 [Hindenburg]. 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.

These were the reasons that prompted Hitler to make me press chief of the Reich Government. The press chief of the Reich 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 Führer'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 Führer 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.

February 26, 1933: Schacht arranges a meeting of the Association of German Industrialists; they will raise 3 million marks for the Nazi Party in the forthcoming election. Among those who address the industrialists is Göring, who states:

The sacrifices which are required would be so much easier for industry to bear, if it knew that the election of 5 March would surely be the last one for the next 10 years, probably even for the next 100 years.

From Funk's IMT testimony: I was at the meeting. Money was not demanded by Göring, but by Schacht. Hitler left the room, then Schacht made a speech asking for money for the election. I was only there as an impartial observer, since I enjoyed a close friendship with the industrialists . . . . I said that Schacht after addresses by Göring and Hitler made a brief speech, and that he asked those present to, so to say, go to the cashier and subscribe, that is, raise money for the election fund. He took over the collection.

From Schacht's IMT testimony: Herr Funk is in error ... Göring directed the request for financial aid, and not I.

March 1933: In the German Federal election, the Nazis receive 17,277,000 votes. 43.9% of the electorate vote for Hitler's party, giving him 288 seats in the Reichstag.

1933: The Frankfurter Zeitung, one of the few democratic papers of the time, is initially protected by Propaganda Minister Goebbels after the seizure of power by the Nazis, because it is convenient for propaganda abroad. Hitler will ban the newspaper in 1943.

From Funk's IMT testimony: We did not talk about [leaving the newspaper in status quo because of its vast influence abroad] at that time. That issue came up later. It came when the Führer demanded that almost all leading daily newspapers should either be taken over by the Party or merged with Party papers. And on that occasion I succeeded in having exception made for the Frankfurter Zeitung, and the Frankfurter Zeitung continued to exist for a long time. But that was much later. Here, in fact, the only reason was to help a few Jewish editors. It was a purely humane reason ... it was always my opinion that the Frankfurter Zeitung should remain as it was.

March 13, 1933: Funk steps down from his now meaningless Reichstag position and is made State Secretary of the Third Reich and Chief Press Officer at the newly established Ministry of Propaganda under Josef Goebbels. In this capacity he is Goebbels' chief aide. From the decree defining the duties of the Minister of Propaganda:

[The Minister has] jurisdiction over the whole field of spiritual indoctrination of the nation, of propagandizing the State, of cultural and economic propaganda, of enlightenment of the public at home and abroad; furthermore, he [Goebbels] is in charge of all institutions serving these purposes.

From Göring's IMT testimony: He [Funk] became State Secretary because the Propaganda Ministry took over as its main function the press and the handling of press matters. Purely propaganda activities were carried on from the beginning by Goebbels himself, who was at the same time Propaganda Chief of the Party. Funk was appointed chiefly to organize the ministry as such, and in particular to handle economic matters of the press, that is, the acquisition of press organs, by purchase, subsidy, et cetera. His specialized knowledge was mainly utilized in this field.

From Funk's IMT testimony: When the Propaganda Ministry was founded the Führer 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 broadcast 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.

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 the fact that many assignments, looked after in other ministries by the State Secretary, were in this case taken care of by Goebbels' expert, Hanke, who was later made State Secretary and Gauleiter . . . .

I had quite a large task, and that was the direction of an extensive cultural and economic concern. I stated that here. It consisted of film companies, theaters, orchestras, the German Trade Publicity Council, and the administration of the entire German radio, an undertaking worth a hundred millions, that is to say, a very extensive activity, an organizational, economic and financial activity. But Goebbels took care of propaganda solely and exclusively.

From Walter Funk, A Life for Economy by Dr. Paul Oestreich (Central Publishing House of the NSDAP, 1941): No less important than Funk's accomplishments in the programmatic field in the years 1931 and 1932 was his activity of that time as the Führer's liaison man to the leading men of the German economy in industry, trade, commerce and finance. On the basis of his past work, his personal relations to the German economic leaders were broad and extensive. He was now able to enlist them in the service of Adolf Hitler, and not only to answer their questions authoritatively, but to convince them and win their backing for the Party. At that time, that was terribly important work. Every success achieved meant a moral, political, and economic strengthening of the fighting force of the Party and contributed toward destroying the prejudice that National Socialism is merely a party of class hatred and class struggle . . . .

Besides, Funk had a special duty from his Ministry received the task to take care of the cultural life. In this position he organized quietly a tremendous concern which represented an investment of many hundreds of millions. In close co-operation with the Reich Leader of the Press, Max Amman, the economic fundamentals of the German press were reconstructed according to the political necessities. The same took place in the film industry and in other cultural fields.

From Funk's IMT testimony: I have already stated that I declared myself for the Party and took up my Party work with enthusiasm. 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. He owned a German newspaper in Chile and for some years he was political editor of the Berliner Borsenzeitung. 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 . . . . 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.

March 22, 1933: Dachau concentration camp opens near Munich, soon to be followed by Ravensbrück for women, Sachsenhausen near Berlin in northern Germany, and Buchenwald near Weimar in central Germany.

March 23, 1933: The Enabling Act (German: Ermächtigungsgesetz) is passed by Germany's Reichstag and signed by President Paul von Hindenburg. This is the second major step, after the Reichstag Fire Decree, through which Chancellor Adolf Hitler will legally obtain plenary powers and establish his dictatorship.

From Hans Heinrich Lammers' IMT testimony: [Funk in this capacity as Press Chief of the Reich Government did not exercise any influence on decisions made by the Reich Cabinet or on the contents of bills of the Reich Cabinet.] At the most, he may have had an influence from the journalistic point of view, that is, for an attractive title for a law, or some sort of popular wording, or something like that. But he did not vote on the contents of the laws. In his position as Press Chief, he was first Ministerial Director and then State Secretary; he had nothing to say about the contents. Funk and I, at the beginning, had as many as three to four meetings a week with the Fuehrer, and this lasted through the summer of 1933. During the winter the meetings became fewer, then became more frequent again, and ceased altogether in 1934, after von Hindenburg's death.

From Funk's IMT testimony: I was no longer a Reichstag deputy [when the Enabling Act was passed]. But even so, I considered these laws necessary. I was not a member of the Cabinet, either.

March 30, 1933: From an interview with Funk published in the Voelkischer Beobachter:

Propaganda is the most modern instrument of power and fighting weapon of state policy. The establishing of the Propaganda Ministry is vital, for the national political policy of the new State Leadership is to be the general good of the whole people. Therefore, the total political, artistic, cultural and spiritual life of the nation, must be brought on to one level and directed from one central point.

From a pamphlet entitled The Reich Ministry for Public Enlightenment and Propaganda, by Georg Wilhelm Mueller, an official of the Ministry of Propaganda: The Department Special Cultural Tasks [a department within the Ministry of Propaganda] serves mainly the purpose to remove the Jews from cultural professions. It reviews the political attitude of all artistic or cultural workers and cultural economic enterprise that are members of the seven individual chambers of the Reich Chamber of Culture [except the Reich Chamber of the Press], it has to supervise the removal of Jews in the entire field of the seven individual chambers and settles as highest authority all complaints and appeals of cultural workers whose membership was rejected by the Chamber because of lack of proof of Aryan descent. At the same time, it is the task of this department to supervise the activities of non-Aryans in the intellectual and entire cultural field, therefore, also the supervision of the only Jewish organization in the cultural field in the entire Reich territory, that is, the Jewish Kulturbund (Jewish Cultural Association).

In this way this department also cooperates with all other professional departments of the Ministry or the Chambers by consulting the local officials of the party, the State police offices, etc., and when supervising the Jewish 'cultural work' with the political police.

It is mainly the merit of this department to 1937 a department in the Managing Office of the Reich Chamber of Culture that the purge of the entire German cultural life from Jewish or other non-German influences was completely accomplished according to the assignments of the Minister.

From The Devils Disciples by Anthony Read: The forty-three-year-old Funk, with his background in financial journalism, was one of Hitler's most influential economic advisers, and the Fuehrer charged him with managing the finances, administration and organization of the new ministry "so that Goebbels will not have to bother" with these matters. Hitler clearly intended Funk to be a restraining influence, keeping an eye on his hot-headed young genius; Goebbels didn't mind—it brought a potential rival under his control, where he could keep an eye on him. And despite his unprepossessing appearance—he was short, paunchy and ugly—and his known penchant for heavy drinking and homosexual debauchery, Funk was amusing company and had a sharp and ready wit. Over the next four years he proved to be Goebbels' most valuable aide and supporter.

April 7, 1933: The Nazi Civil Service Act is passed, a law providing that all civil servants must be trustworthy—as defined by Nazi standards—and must also meet the Nazi racial requirements.

October 14, 1933: Germany withdraws from the International Disarmament Conference and the League of Nations.

1933: Funk is appointed Vice President of the Reich Chamber of Culture. Goebbels is its President and Funk its Vice President. By virtue of his dual position (Funk is also Chief Press Officer of the Ministry of Propaganda), Funk directly promotes two fundamental and related Nazi policies: (1) the regimentation of all creative activities in he interest of Nazi political and military objectives; (2) the elimination of Jews and dissidents from the so-called cultural professions. In addition, Funk also is appointed Vice-president of the Filmkreditbank. The Filmkreditbank is a government-controlled financing corporation which influences film production in the interests of the Nazi program by granting financial assistance in connection with only those films deemed desirable from the Nazi point of view.

From Funk's IMT testimony: I do not believe that during the entire period of my activity in the Propaganda Ministry I signed even three times as Goebbels' deputy. The Prosecution has nailed down one of these signatures. 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. 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 . . . .

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 anti-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. Everyone who knows me from my activities during that period can and must testify to that.

It was not in accordance with the intentions of the Party [that members of the staff who were not of Aryan descent should no longer have been employed], but in accordance with the law passed for the Chamber of Culture that they were no longer to be employed.

March 29, 1934: A system of forced corporate lending to the Reich is imposed on German business.

August 19, 1934 Gleichschaltung: Hitler becomes Führer und Reichskanzler, as 90% of the German electorate approves Hitler's merging the two offices of Chancellor and President.

June 30, 1934 Blutbereinigung: The 'Blood Purge' (Night of the Long Knives) occurs.

July 25, 1934: Austrian Chancellor Dollfuss is murdered by eight Austrian Nazis. A coup d'état fails, however, and order is soon restored. Kurt Alois Josef Johann Schuschnigg becomes Austria's new federal chancellor.

September 30, 1934: From a report of the Ministry of Economics, revealing concentration upon all the familiar wartime economic problems, including stockpiling, production of scarce goods, removal of industry to secure areas, fuel and power supply for war production, machine tools, control of wartime priorities, rationing, price control, and civilian supply:

With the establishment of the Reich Defense Council and its permanent committee, the Reich Ministry of Economics has been given the task of making economic preparation for war. There should really be no need to explain the tremendous importance of this task. Everyone remembers vividly how terribly the lack of any economic preparation for war hit us during the World War.

March 7, 1935: Hitler occupies the Rhineland.

March 16, 1935: Hitler's Germany institutes universal military service.

June 1935: Famed German composer and prominent conductor, Richard Georg Strauss, writes a letter to Stefan Zweig, in which he states:

Do you believe I am ever, in any of my actions, guided by the thought that I am 'German'? Do you suppose Mozart was consciously 'Aryan' when he composed? I recognize only two types of people: those who have talent and those who have none.

The letter to Zweig is intercepted by the Gestapo and sent to Hitler. Strauss is subsequently dismissed from his post as Reichsmusikkammer president.

From Funk's IMT testimony: 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 Führer, and the whole affair was dismissed. Dr. Wilhelm Furtwangler found himself in similar difficulties because he wrote an article praising the composer Hindemith; 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.

January 17, 1936: Göring delivers his famous 'guns versus butter' speech.

August 1936: Hitler appoints Ribbentrop ambassador to London. His main objective will be to persuade the British government not to get involved in Germany territorial disputes and, to work together against the communist government in the Soviet Union.

August 1936: From a memorandum by Hitler:

It is, above all, not the task of State economic institutions to rack their brains about methods of production. This does not concern the Ministry of Economics at all . . . . It is furthermore essential that German iron production be increased to the utmost. The objection that we are not in a position to produce the same cheap raw iron from German ore, which has only 26 percent of iron content, as from the 45 percent Swedish ores, is unimportant . . . The objection that, in this case, all the German smelting works would have to be reconstructed is also irrelevant and, in any case, this is none of the business of the Ministry of Economics . . . . I want to emphasize in this connection that, in these tasks, I see the only possible economic mobilization, and not in the curbing of the armament industry.
September 1936: Hitler announces the Four-Year Plan of self-sufficiency in Nuremberg and Goering is named Plenipotentiary of the Four-Year Plan.

From Hans Heinrich Lammers' IMT testimony: The Four-Year Plan was set up in 1936, and it was extended in 1940 for another 4 years. These special powers which Herr Funk later surrendered to the Four-Year Plan were based on an agreement between Reich Marshal Goering and Minister Funk, an arrangement which, as far as I know, had the Fuehrer's approval.

February 27, 1937: From the files of the General Manager of German Broadcasting: Weinbrenner made the following statement: ... Dr. Goebbels reaches most of the important decisions only by agreement with Under-Secretary Funk.

From an affidavit signed by Max Amman, Reich Leader of the Press and President of the Reich Press Chamber: In carrying out my duties and responsibilities I became familiar with the operation and the organization of the Reich Ministry of Propaganda and Enlightenment. Funk was the soul of the Ministry, and without him Goebbels could not have built it up. Goebbels once stated to me that Funk was his "most efficient man." Funk exercised comprehensive control over all of the media of expression in Germany; over the press, the theater, radio, and music. As Press Chief of the Government and later as undersecretary of the Ministry, Funk held daily meetings with the Führer and a daily press conference in the course of which he issued the directives governing the materials to be published by the German press.

From Funk's IMT testimony: 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. [Max] Amman 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.

November 5, 1937 Hossbach-Konferenz: Hitler addresses Goering, Raeder, Neurath, and other military leaders.

November 26, 1937: Schacht steps down from his post as Minister of Economics and Plenipotentiary General for War Economy. He accepts appointment as Minister without Portfolio, a post he will hold until January 1943.

From Funk's IMT testimony: That took me completely by surprise, too. During a performance at the opera, the Führer, who was present, took me aside in the vestibule during an interval and told me that the differences between Schacht and Göring 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 Göring who would explain everything else.

That was the only conversation that I had with the Führer on the subject. 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. 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 . . . . 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.

November 29, 1937: From a letter from von Blomberg, who refers to the fact that Schacht has been relieved as Minister of Economics and Plenipotentiary General for War Economy and urges that Funk be appointed immediately, to Göring:

The urgency of unified further work on all preparations for the conduct of the war does not admit of this office being paralyzed until 15 January 1938.

From Funk's IMT testimony: That may be [that von Blomberg thought that the job that he was suggesting me for would have some very great effect upon the conduct of the war], but in the first place, I do not know about that letter and, secondly, I was not immediately appointed Plenipotentiary for Economy but only in the course of 1938. Quite some time after I had been appointed Minister for Economics I asked Lammers why my appointment as Plenipotentiary for Economy had taken so long; he replied that my relationship to the Delegate for the Four Year Plan had to be cleared up first. That was the reason why several months passed before I became Plenipotentiary for Economy, because it had to be ascertained that Göring had the decisive authority for war economy. I do not know about that letter, and I have never spoken to von Blomberg about the affair.

February 4, 1938: Hitler abolishes the Ministry of War, assumes direct command of the Armed Forces himself, and creates the OKW (Oberkommando der Wehrmacht). General von Brauchitsch becomes Commander-in-Chief of the Army and Wilhelm Keitel becomes the new head of the OKW. This weakens the traditional Army High Command (Oberkommando des Heeres, or OKH) which is now subordinated to the OKW.

February 4, 1938: The Reich Ministry of Economics undergoes a major reorganization. Its Ministry functions are integrated with the Four-Year Plan as the Supreme Command of the German military economy. Göring accomplishes the reorganization, in his capacity as Commissar for the Four-Year Plan by decree. Under this decree, the jurisdiction of the Economics Ministry is defined as covering the following fields of Germany's economy: German raw and working materials, mining, iron industry, power industry, handicrafts, finance and credit, foreign trade … and exports. As a result of this decree, sectors of the German economy which are strategic in the organization of war and armaments economy are placed under the immediate control of Funk.

Furthermore, the Reich Office for Economic Development, charged by the decree, with "research, planning and execution of the Four-Year Plan", is incorporated into the Reich Ministry of Economics. Similarly, the Reich Office for Soil Research and the Office of the Reich Commissar for the exploitation of Scrap Materials are made subject to that Ministry. Thus, it is clear that the reorganization decree concentrates significant responsibilities in the hands of Funk and thereby makes him one of the chief agents of economic mobilization during a decisive period.

From Funk's IMT testimony: 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.

[By civilian production I mean] 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 Ministry of Commerce, which dealt only with the distribution of consumer goods. 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. [The direction of foreign trade] was in the hands of the Foreign Office. The Minister for Foreign Affairs obstinately laid claim to that. 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.

1938: Funk is appointed Chief Plenipotentiary for Economics (or, GBA).

From Hans Heinrich Lammers' IMT testimony: [Funk], as Minister of Economics, ... very rarely came to the Führer. At many conferences he was not consulted, even at conferences in which he ought to have been consulted. Quite often he complained to me about that. I tried in every way to do my best to include him in such conferences, but I did not always succeed. I informed Herr Funk that I had made the greatest effort to have him participate in these conferences; the Führer, however, had refused. Frequently the Führer made objections; those were various reasons in the case of Funk. He was skeptical about him and did not want him there.

From Funk's IMT testimony: This [GBA] of all the positions I had was the least impressive. As the Reich Marshal correctly stated, and as Dr. Lammers confirmed, it existed merely on paper. That, too, was an essential difference between the position that Schacht had and the one that I had.

Schacht had been appointed Plenipotentiary General for War Economy. I, on the other hand, was the Plenipotentiary General for Economy. According to the Reich Defense Law of 1938, the Plenipotentiary General for Economy was to co-ordinate the civil economics departments in preparing for a war. But, in the meantime, these economic departments had been subordinated to the Delegate for the Four-Year Plan, and I, as Plenipotentiary General for Economy, was also subordinate to the Delegate for the Four-Year Plan.

Consequently, there was confusion and overlapping in matters of competence and authority as they had been laid down formally. The result was a directive of the Fuehrer just a few months after the beginning of the war which de jure and formally transferred the authority of the Plenipotentiary General for Economy, as far as the civil economic departments were concerned, to the Delegate for the Four-Year Plan. That was in December of 1939. There remained only a formal authority to issue directives, that is, I could sign directives on behalf of the five civil economic departments, which, according to the Reich Defense Law, were subordinate to the Plenipotentiary. I retained authority over the Ministry of Economics and the Reichsbank, which I had in any case.

February 1938: Funk replaces Hjalmar Schacht as Reich Minister of Economics.

From Goering's IMT testimony: In discussing the Four-Year Plan I explained that after the resignation of Schacht, I personally directed the Ministry from November 1937 to February 1938, as far as I remember, although Funk had already been designated. I did this in order to integrate again into the Ministry of Economics the economic agencies outside the Ministry, which were involved in the Four-Year Plan. By freeing myself of this burden I was able to administer my directives with the Ministry as such. He [Funk] was appointed Plenipotentiary General only in 1938 due to the fact that it was only in 1938 that he actually took over the Ministry of Economics. According to an old regulation, the Plenipotentiary General for Economics was identical with the Reich Minister of Economics.

But at this time, during the last part of Schacht's term of office, that was just a matter of form, as I have already said; for I explained that from the minute when I actually took over the Four-Year Plan, I personally was de facto the Plenipotentiary General for Economics. I suggested that this office be abolished, but, as is often the case, some things remain purely for reasons of prestige, things which no longer have any real significance. The Delegate for the Four-Year Plan was the sole Plenipotentiary General for the entire German economy. Since there could not be two such men, the other existed only on paper.

Naturally, according to the plenary powers that were given me, he had to comply with my economic directives as far as the Ministry of Economics and the Reich Bank were concerned. That was a reason for the change, because I could not follow this procedure with Schacht, but from the beginning, Funk adopted an irreproachable attitude toward me in this respect. The directions or the economic policy which the Reich Minister of Economics and Reich Bank President Funk carried out are fully and entirely my exclusive responsibility.

[Next: Part Two, Click Here.]
[Part Five, 6/7/1945-5/31/1960.] [Part Four, 9/8/1942-5/1945.] [Part Three, 8/27/1939-8/20/1942.] [Part Two, 3/12/1938-8/25/1939.] [Part One, 8/18/1890-2/1938.]
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