Hjalmar Schacht

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Hjalmar Schacht
Hjalmar Schacht.jpg
Reichsminister of Economics
In office
3 August 1934 – 26 November 1937
PresidentAdolf Hitler (as Führer)
ChancellorAdolf Hitler
Preceded byKurt Schmitt
Succeeded byHermann Göring
General Plenipotentiary for War Economy
In office
21 May 1935 – 26 November 1937
Preceded byOffice established
Succeeded byWalther Funk
President of the Reichsbank
In office
12 November 1923 – 7 March 1930
Preceded byRudolf E. A. Havenstein
Succeeded byHans Luther
In office
17 March 1933 – 20 January 1939
Preceded byHans Luther
Succeeded byWalther Funk
Reichsminister without Portfolio
In office
26 November 1937 – 22 January 1943
Personal details
Horace Greeley Hjalmar Schacht

(1877-01-22)22 January 1877
Tinglev, German Empire
Died3 June 1970(1970-06-03) (aged 93)
Munich, West Germany
Resting placeMunich Ostfriedhof
Political party
Luise Sowa
(m. 1903; died 1940)
(m. 1941)
ChildrenCordula Schacht[1]
ProfessionBanker, economist

Hjalmar Schacht (born Horace Greeley Hjalmar Schacht; 22 January 1877 – 3 June 1970, German pronunciation: [ˈjalmaʁ ˈʃaxt]) was a German economist, banker, centre-right politician, and co-founder in 1918 of the German Democratic Party. He served as the Currency Commissioner and President of the Reichsbank under the Weimar Republic. He was a fierce critic of his country's post-World War I reparations obligations. He was arrested by the Gestapo in the summer of 1944.

He served in Adolf Hitler's government as President of the Central Bank (Reichsbank) 1933–1939 and became Minister of Economics (August 1934 – November 1937).

While Schacht was for a time feted for his role in the German "economic miracle", he opposed Hitler's policy of German re-armament insofar as it violated the Treaty of Versailles and (in his view) disrupted the German economy. His views in this regard led Schacht to clash with Hitler and most notably with Hermann Göring[citation needed]. He was dismissed as President of the Reichsbank in January 1939. He remained as a minister without portfolio, and received the same salary, until he was fully dismissed from the government in January 1943.[2]

In 1944, Schacht was arrested by the Gestapo after the assassination attempt on Hitler on 20 July 1944 because he allegedly had contact with the assassins. Subsequently, he was interned until the end of the Third Reich in the concentration camps Ravensbrück and later at Flossenbürg. In the last days of the war, he was one of the 134 special and clan prisoners[a] who were transported by the SS from Dachau to South Tyrol. This location is within the area named by Himmler the "Alpine Fortress", and it is speculated that the purpose of the prisoner transport was with the intent of holding hostages. They were freed in Niederdorf, South Tyrol, in Italy, on 30 April 1945.[4]

Schacht was tried at Nuremberg, but was fully acquitted over Soviet objections; later on, a German denazification tribunal sentenced him to eight years' hard labor, which was also overturned on appeal.

In 1955, he founded a private banking house in Düsseldorf. He also advised developing countries on economic development.

Early life and career[edit]

Schacht was born in Tingleff, Prussia, German Empire (now in Denmark) to William Leonhard Ludwig Maximillian Schacht and baroness Constanze Justine Sophie von Eggers, a native of Denmark. His parents, who had spent years in the United States, originally decided on the name Horace Greeley Schacht, in honor of the American journalist Horace Greeley. However, they yielded to the insistence of the Schacht family grandmother, who firmly believed the child's given name should be Danish. After completing his Abitur at the Gelehrtenschule des Johanneums, Schacht studied medicine, philology, political science, and finance at the Universities of Munich, Leipzig, Berlin, Paris and Kiel[5] before earning a doctorate at Kiel in 1899 – his thesis was on mercantilism.[6][7]

He joined the Dresdner Bank in 1903. In 1905, while on a business trip to the United States with board members of the Dresdner Bank, Schacht met the famous American banker J. P. Morgan, as well as U.S. president Theodore Roosevelt. He became deputy director of the Dresdner Bank from 1908 to 1915. He was then a board member of the German National Bank [de] for the next seven years, until 1922, and after its merger with the Darmstädter und Nationalbank (Danatbank), a board member of the Danatbank.

Schacht was a freemason, having joined the lodge Urania zur Unsterblichkeit in 1908.[8]

During the First World War, Schacht was assigned to the staff of General Karl von Lumm (1864–1930), the Banking Commissioner for Occupied Belgium, to organize the financing of Germany's purchases in Belgium. He was summarily dismissed by General von Lumm when it was discovered that he had used his previous employer, the Dresdner Bank, to channel the note remittances for nearly 500 million francs of Belgian national bonds destined to pay for the requisitions.[9]

After Schacht's dismissal from public service, he had another brief stint at the Dresdner Bank, and then various positions at other banks. In 1923, Schacht applied and was rejected for the position of head of the Reichsbank, largely as a result of his dismissal from Lumm's service.[9]

Rise to president of the Reichsbank[edit]

Reichsbank President Schacht

Despite the blemish on his record, in November 1923, Schacht became currency commissioner for the Weimar Republic and participated in the introduction of the Rentenmark, a new currency the value of which was based on a mortgage on all of the properties in Germany.[10] Germany entered into a brief period where it had two separate currencies: the Reichsmark managed by Rudolf Havenstein, President of the Reichsbank, and the newly created Rentenmark managed by Schacht.

After his economic policies helped battle German hyperinflation and stabilize the German mark (Helferich Plan), Schacht was appointed president of the Reichsbank at the requests of president Friedrich Ebert and Chancellor Gustav Stresemann.

In 1926, Schacht provided funds for the formation of IG Farben. He collaborated with other prominent economists to form the 1929 Young Plan to modify the way that war reparations were paid after Germany's economy was destabilizing under the Dawes Plan. In December 1929, he caused the fall of the Finance Minister Rudolf Hilferding by imposing upon the government his conditions for obtaining a loan.[6] After modifications by Hermann Müller's government to the Young Plan during the Second Conference of The Hague (January 1930), he resigned as Reichsbank president on 7 March 1930. During 1930, Schacht campaigned against the war reparations requirement in the United States.[6]

Schacht became a friend of the Governor of the Bank of England, Montagu Norman, both men belonging to the Anglo-German Fellowship and the Bank for International Settlements. Norman was so close to the Schacht family that he was godfather to one of Schacht's grandchildren.[11]

Involvement with the NSDAP and government[edit]

By 1926, Schacht had left the small German Democratic Party, which he had helped found, and began increasingly lending his support to the Nazi Party (NSDAP), to which he became closer between 1930 and 1932. Though never a member of the NSDAP, Schacht helped to raise funds for the party after meeting with Adolf Hitler. Close for a short time to Heinrich Brüning's government, Schacht shifted to the right by entering the Harzburg Front in October 1931.[6]

Schacht's disillusionment with the existing Weimar government did not indicate a particular shift in his overall philosophy, but rather arose primarily out of two issues:

  • his objection to the inclusion of Socialist Party elements in the government, and the effect of their various construction and job-creation projects on public expenditures and borrowings (and the consequent undermining of the government's anti-inflation efforts);[12]
  • his desire to see Germany retake its place on the international stage, and his recognition that "as the powers became more involved in their own economic problems in 1931 and 1932 ... a strong government based on a broad national movement could use the existing conditions to regain Germany's sovereignty and equality as a world power."[13]

Schacht believed that if the German government was ever to commence a wholesale reindustrialization and rearmament in spite of the restrictions imposed by Germany's treaty obligations, it would have to be during a period lacking clear international consensus among the Great Powers.

After the July 1932 elections, in which the NSDAP won more than a third of the seats, Schacht and Wilhelm Keppler organized a petition of industrial leaders requesting that president Hindenburg appoint Hitler as Chancellor. After Hitler took power in January 1933, Schacht won re-appointment as Reichsbank president on 17 March.

Schacht (left) at a meeting in the Reichsbank transfer commission in 1934

In August 1934 Hitler appointed Schacht as Germany's Reichsminister of Economics. Schacht supported public-works programs, most notably the construction of autobahnen (highways) to attempt to alleviate unemployment – policies which had been instituted in Germany by von Schleicher's government in late 1932, and had in turn influenced Roosevelt's policies. He also introduced the "New Plan", Germany's attempt to achieve economic "autarky", in September 1934. Germany had accrued a massive foreign currency deficit during the Great Depression, which continued into the early years of the Third Reich. Schacht negotiated several trade agreements with countries in South America and southeastern Europe, under which Germany would continue to receive raw materials, but would pay in Reichsmarks. This ensured that the deficit would not get any worse, while allowing the German government to deal with the gap which had already developed. Schacht also found an innovative solution to the problem of the government deficit by using mefo bills. He was appointed General Plenipotentiary for the War Economy in May 1935 by provision of the Reich Defense Law of 21 May 1935[14] and was awarded honorary membership in the NSDAP and the Golden Party Badge in January 1937.

Schacht disagreed with what he called "unlawful activities" against Germany's Jewish minority and in August 1935 made a speech denouncing Julius Streicher and Streicher's writing in the Nazi newspaper Der Stürmer.[15]

Schacht and Hitler in 1936

During the economic crisis of 1935–36, Schacht, together with the Price Commissioner Dr. Carl Friedrich Goerdeler, helped lead the "free-market" faction in the German government. They urged Hitler to reduce military spending, turn away from autarkic and protectionist policies, and reduce state control in the economy. Schacht and Goerdeler were opposed by a faction centering on Hermann Göring.[16]

Göring was appointed "Plenipotentiary for the Four Year Plan" on 18 October 1936, with broad powers that conflicted with Schacht's authority. Schacht objected to continued high military spending, which he believed would cause inflation, thus coming into conflict with Hitler and Göring.

In 1937 Schacht met with Chinese Finance Minister Dr. H. H. Kung. Schacht told him that "German-Chinese friendship stemmed in good part from the hard struggle of both for independence". Kung said, "China considers Germany its best friend ... I hope and wish that Germany will participate in supporting the further development of China, the opening up of its sources of raw materials, the upbuilding of its industries and means of transportation."[17]

In November 1937 he resigned as Reichsminister of Economics and General Plenipotentiary at both his and Göring's request. He had grown increasingly dissatisfied with Göring's near-total ignorance of economics, and was also concerned that Germany was coming close to bankruptcy. Hitler, however, knew that Schacht's departure would raise eyebrows outside Germany, and insisted that he remain in the cabinet as minister without portfolio. He remained President of the Reichsbank until Hitler dismissed him in January 1939. He remained as a Reichsminister without Portfolio, and received the same salary, until he was fully dismissed in January 1943.

Following the Kristallnacht of November 1938, Schacht publicly declared his repugnance at the events, and suggested to Hitler that he should use other means if he wanted to be rid of the Jews.[18] He put forward a plan in which Jewish property in Germany would be held in trust, and used as security for loans raised abroad, which would also be guaranteed by the German government. Funds would be made available for emigrating Jews, in order to overcome the objections of countries that were hesitant to accept penniless Jews. Hitler accepted the suggestion, and authorised him to negotiate with his London contacts. Schacht, in his book The Magic of Money (1967), wrote that Montagu Norman, governor of the Bank of England, and Lord Bearstead, a prominent Jew, had reacted favourably, but Chaim Weizmann, leading spokesman for the Zionist movement in Britain, opposed the plan.[19] A component of the plan was that emigrating Jews would have taken items such as machinery with them on leaving the country, as a means of boosting German exports.[20] The similar Haavara Agreement had been signed in 1933.

Resistance activities[edit]

Schacht was said to be in contact with the German resistance as early as 1934, though at that time he still believed the Nazi regime would follow his policies. By 1938, he was disillusioned, and was an active participant in the plans for a coup d'état against Hitler if he started a war against Czechoslovakia.[21] Goerdeler, his colleague in 1935–36, was the civilian leader of resistance to Hitler. Schacht talked frequently with Hans Gisevius, another resistance figure; when resistance organizer Theodor Strünck's house (a frequent meeting place) was bombed out, Schacht allowed Strünck and his wife to live in a villa he owned. However, Schacht had remained in the government and, after 1941, Schacht took no active part in any resistance.

Still, at Schacht's denazification trial (subsequent to his acquittal at Nuremberg) it was declared by a judge that "None of the civilians in the resistance did more or could have done more than Schacht actually did."[22]

After the attempt on Hitler's life on 20 July 1944, Schacht was arrested on 23 July.[6] He was sent to Ravensbrück, then to Flossenbürg,[6] and finally to Dachau. In late April 1945 he and about 140 other prominent inmates of Dachau were transferred to Tyrol by the SS, which left them there. They were liberated by the Fifth U.S. Army on 5 May 1945 in Niederdorf, South Tyrol, Dolomites, Italy.[23]

After the war[edit]

Schacht in an Allied internment camp, 1945

Schacht had supported Hitler's gaining power, and had been an important official of the Nazi regime. Thus he was arrested by the Allies in 1945. He was put on trial at Nuremberg for "conspiracy" and "crimes against peace" (planning and waging wars of aggression), but not war crimes or crimes against humanity.[24]

Schacht pleaded not guilty to these charges. He cited in his defense that he had lost all official power before the war even began, that he had been in contact with Resistance leaders like Hans Gisevius throughout the war, and that he had been arrested and imprisoned in a concentration camp himself.[25]

His defenders argued that he was just a patriot, trying to make the German economy strong. Furthermore, Schacht was not a member of the NSDAP and shared very little of their ideology. The British judges favored acquittal, while the Soviet judges wanted to convict.[26] The British prevailed and Schacht was acquitted. However, at a West German denazification trial, Schacht was sentenced to eight years hard labor. He was freed on appeal in 1948.

In 1950, Juan Yarur Lolas, the Palestinian-born founder of the Banco de Crédito e Inversiones and president of the Arab colony in Santiago, Chile, tried to hire Schacht as a "financial adviser" in conjunction with the German-Chilean community.[27] However, the plan fell through when it became news.[27] He served as a hired consultant for Aristotle Socrates Onassis, a Greek businessman, during the 1950s.[28]

Schacht (right) with Stafford Sands, while visiting the Bahamas in 1962

In 1953, Schacht started a bank, Deutsche Außenhandelsbank Schacht & Co., which he led until 1963. He also gave advice on economics and finance to heads of state of developing countries, in particular the Non-Aligned countries; however, some of his suggestions were opposed, one of which was in the Philippines by the former Bangko Sentral ng Pilipinas head Miguel Cuaderno, who firmly rebuffed Schacht, stating that his monetary schemes were hardly appropriate for an economy needing capital investment in basic industry and infrastructure.

Indirectly resulting from his founding of the bank, Schacht was the plaintiff in a foundational case in German law on the "general right of personality". A magazine published an article criticizing Schacht, containing several incorrect statements. Schacht first requested that the magazine publish a correction, and when the magazine refused, sued the publisher for violation of his personality rights. The district court found the publisher both civilly and criminally liable; on appeal, the appellate court reversed the criminal conviction, but found that the publisher had violated Schacht's general right of personality.[29]

Schacht died in Munich, West Germany, on 3 June 1970.


Schacht wrote 26 books[30] during his lifetime, of which at least four have been translated into English:

  • The Stabilisation of the Mark (1927) ([1])
  • The End of Reparations (J. Cape & H. Smith; 1931)
  • Account Settled/Abrechnung mit Hitler[31] (1949) after his acquittal at the Nuremberg Trials [32]
  • Confessions of the Old Wizard, (Boston: Houghton Mifflin, 1956) ([2])
  • The Magic of Money, (London: Oldbourne, 1967)
  • My First Seventy-Six Years (autobiography), (Allan Wingate, 1955; online) [33]


  • Gustave Gilbert, an American Army psychologist, examined the Nazi leaders who were tried at Nuremberg. He administered a German version of the Wechsler-Bellevue IQ test. Schacht scored 143, the highest among the leaders tested, after adjustment upwards to take account of his age.[34]
  • When he stabilized the mark in 1923, Schacht's office was a former charwoman's cupboard. When his secretary, Fräulein Steffeck, was later asked about his work there. She described it as follows:
What did he do? He sat on his chair and smoked in his little dark room which still smelled of old floor cloths. Did he read letters? No, he read no letters. Did he write letters? No, he wrote no letters. He telephoned a great deal – he telephoned in every direction and to every German or foreign place that had anything to do with money and foreign exchange as well as with the Reichsbank and the Finance Minister. And he smoked. We did not eat much during that time. We usually went home late, often by the last suburban train, travelling third class. Apart from that he did nothing.[35]

Portrayal in popular culture[edit]

Hjalmar Schacht has been portrayed by the following actors in film, television and theater productions;[36]

Hjalmar Schacht appears in the following works of fiction:

  • In Nancy Mitford's 'The Pursuit of Love'(1945) Sir Leicester Kroesig is 'taken for a drive in a Mercedes Benz by Doctor Schacht'
  • Southern Victory Series, an alternate history epic by Harry Turtledove. Schacht cameos in Volume 7: The Victorious Opposition, as German Ambassador to the United States.

See also[edit]


  1. ^ "Clan prisoners" is a translation of the German-language term Sippenhäftlinge, which means those persons arrested because they were family members of other prisoners.[3]


  1. ^ Alberge, Dalya (18 April 2015). "Random House told it should pay to quote Joseph Goebbels in biography". The Guardian. London, UK. Retrieved 16 May 2015.
  2. ^ Richard J. Evans, The Third Reich in Power 1933–1939. Penguin Books. ISBN 978-1-59420-074-8. p. 153, states that he had no role in government during World War II which is untrue[citation needed].
  3. ^ Schlingensiepen, Ferdinand (2010). Dietrich Bonhoeffer 1906-1945: Martyr, Thinker, Man of Resistance. A&C Black. p. 372. ISBN 9780567217554. Petropoulos, Jonathan (2008). Royals and the Reich: The Princes Von Hessen in Nazi Germany. Oxford University Press. p. 286. ISBN 9780195339277.
  4. ^ Peter Koblank: Die Befreiung der Sonder- und Sippenhäftlinge in Südtirol. Online-Edition Mythos Elser 2006.
  5. ^ "Horace Greely Hjalmar Schacht". Der Spiegel. 8 October 1958. Retrieved 6 March 2016.
  6. ^ a b c d e f Hjalmar SCHACHT, biography Archived 4 May 2006 at the Wayback Machine by Frédéric Clavert, author of a thesis on Schacht, Hjalmar Schacht, financier et diplomate 1930–1950, Univ. of Strasbourg, France, 2006 (in French, English, and German)
  7. ^ "Schacht, Hjalmar" in Munzinger Online/Personen – Internationales Biographisches Archiv, URL: http://www.munzinger.de/document/00000000515 (abgerufen am 2016-03-06)
  8. ^ Hjalmar Schacht, Confessions of the "Old Wizard", (Boston: Houghton Mifflin, 1956), 105.
  9. ^ a b Peterson, Edward Norman. Hjalmar Schacht: For and Against Hitler. Christopher Publishing House (Boston: 1954) pg. 24–31
  10. ^ Peterson, Edward Norman. Hjalmar Schacht: For and Against Hitler. Christopher Publishing House (Boston: 1954) pg. 49–62
  11. ^ Neil Forbes, Doing Business with the Nazis (2013), p. 117
  12. ^ Simpson, Amos E. Hjalmar Schacht in Perspective. Mouton Group (Paris: 1969) pg. 30–32
  13. ^ Simpson, Amos E. Hjalmar Schacht in Perspective. Mouton Group (Paris: 1969) pg. 179
  14. ^ Reich Defense Law of 21 May 1935 in UConn Library Archives and Special Collections, retrieved 24 December 2020.
  15. ^ "Nazi Conspiracy and Aggression Volume 2 Chapter XVI Part 12 Hjalmar Schacht". Avalon Project. Lillian Goldman Law Library. 2008. Retrieved 8 March 2019.
  16. ^ Kershaw, Ian. Hitler Nemesis. New York: Norton (2000). pages 18–20
  17. ^ Claude A. Buss (2007). War and Diplomacy in Eastern Asia (reprint ed.). READ BOOKS. p. 405. ISBN 978-1-4067-7514-3. Retrieved 21 May 2011.
  18. ^ Schacht, Hjalmar. The Magic of Money. Trans. by Paul Erskine. London: Oldbourne (1967). page 59
  19. ^ Schacht, Hjalmar (1967). The Magic of Money.
  20. ^ "Schacht Plan Exempted". The Montreal Gazette. 13 December 1938.
  21. ^ Gisevius, Hans Bernd (1998). To the Bitter End: An Insider's Account of the Plot to Kill Hitler, 1933–1944. New York: Da Capo Press. pp. 304–306. ISBN 0-306-80869-2.
  22. ^ Peterson, Edward Norman. Hjalmar Schacht: For and Against Hitler. Christopher Publishing House (Boston: 1954) pg. 340(in English)
  23. ^ Peter Koblank: Die Befreiung der Sonder- und Sippenhäftlinge in Südtirol, Online-Edition Mythos Elser 2006 (in German)
  24. ^ Biagi, Enzo (1983). La seconda guerra mondiale, una storia di uomini [The world war two, a history of men] (in Italian). Milan: Gruppo editoriale Fabbri. p. 2757.
  25. ^ Hjalmar Schacht case for the defence at Nuremberg trials
  26. ^ Taylor, Telford. The Anatomy of the Nuremberg Trials: A Personal Memoir. Alfred A. Knopf (New York: 1992) pg. 564–65
  27. ^ a b Aronsfeld, C. C. (8 September 1950). "Nazis in South America". The Wisconsin Jewish Chronicle. p. 3. Retrieved 31 December 2016 – via Newspapers.com. An effort to secure the immigration of Dr. Schacht, the former Ministry of Economy, was made by the Santiago German colony. They worked in league with the local Germany colony, whose President, Juan Yarur, one of the wealthiest industrialists in Chile, was to have engaged the doctor as "financial adviser." Timely publicity helped to frustrate the clever design.
  28. ^ Nathan J. Citino (2000). "Defending the 'postwar petroleum order': The US, Britain and the 1954 Saudi‐Onassis Tanker deal". Diplomacy and Statecraft. 11 (2): 146. doi:10.1080/09592290008406160. S2CID 154961797.
  29. ^ BGH 25 May 1954, BGHZ 13, 334; as summarized in "Fundamentals of European Civil Law", Martin Vranken, 1997.
  30. ^ "Archived copy". Archived from the original on 23 July 2011. Retrieved 14 November 2009.CS1 maint: archived copy as title (link)
  31. ^ National Library of Austria -- Bibliothek ID 2445978. The word Abrechnung has the literal meaning of deduct, however this can also mean to balance the books or to settle an account. Therefore Abrechnung mit Hitler best translates as Settling Accounts With Hitler (Which is a double entendre in German that is missing from the English title.)"Account Settled". Retrieved 9 March 2020.
  32. ^ The Nuremberg Trials{Nuremberg trials Der Nürnberg Prozesse -- Retrieved 2020-03-09
  33. ^ also Literary Licensing 2011, ISBN 978-1258126742
  34. ^ Gilbert, Gustave. Nuremberg Diaries. Da Capo Press (New York: 1947).
  35. ^ When Money Dies: The Nightmare of the Weimar Collapse Chapter 13: Schacht Archived 24 May 2009 at the Wayback Machine
  36. ^ "Hjalmar Schacht (Character)". IMDb.com. Archived from the original on 1 November 2015. Retrieved 20 May 2008.

Further reading[edit]

External links[edit]