Nazi corruption

The regime’s departure from normative commitments bolstered not only radicalism but encouraged unprecedented degrees of corruption, patronage and outright embezzlement. In their first years in power, the National Socialists may never have tired of excoriating the alleged dishonesty of democratic politicians during the Weimar Republic, but they themselves flung the door to corruption wide open within their own ranks. This began with preferential treatment for long-standing party members in the procurement of jobs. Thanks to political favouritism, National Socialists poured into open positions in the civil service even though they sometimes lacked even the most basic qualifications. Moreover, city utilities—water, gas and electricity companies—and former union-owned and union-affiliated institutions like the Volksfürsorge insurance company or the GEG consumer cooperative became, in the words of the historian Frank Bajohr, “job-creation entities for National Socialists.”

The sense of personal entitlement and privilege flourished most at the top levels of the regime. “The degree and extent of corruption in the ruling class is without parallel,” complained Sebastian Haffner in 1940, looking back at the years 1933 to 1938, before he fled to Britain. Hitler led his underlings by poor example. In October 1934, a conscientious auditor determined that the chancellor owed 405,494.40 reichsmarks in taxes for the fiscal year 1933–34 alone. Munich Superior Financial President Ludwig Mirre was hastily summoned to Berlin where the state secretary in the Finance Ministry, Fritz Reinhardt, informed him that Hitler was exempt from taxes “due to his constitutional status.” In December, Mirre consequently instructed the head of Hitler’s local tax office: “All tax notifications in so far as they concern an obligation on the part of the Führer are by definition null and void…with that the Führer is exempt from taxes!” As an expression of gratitude for his “official help,” Mirre received a monthly raise of 2,000 reichsmarks and was named president of the Reich Financial Court in April 1935.

The tax-exempt dictator also had a plethora of funds into which he could dip to reward favourites and loyal vassals or to finance his private art collection. Among them were the Reich chancellor’s and (after Hindenburg’s death) the Reich president’s discretionary funds, with which he as the head of state could do as he pleased. Along with royalties from sales of Mein Kampf, which earned him 1–2 million reichsmarks a year, Hitler acquired another enviable source of income in 1937, when he was paid a percentage of the revenues brought in by stamps bearing his image. The annual resulting income was in the tens of millions—Reich Postal Minister Ohnesorge presented Hitler with a cheque every year on his birthday. Even more lucrative was the “Adolf Hitler donation of the German economy,” instituted in June 1933 at the suggestion of Gustav Krupp von Bohlen und Halbach. IT HAD EMPLOYERS PAYING A QUARTERLY TAX-DEDUCTIBLE DONATION OF 0.5 PER CENT OF THEIR WAGE COSTS INTO A PRIVATE ACCOUNT THAT HITLER COULD USE AS HE SAW FIT. Hitler appointed Martin Bormann to manage this account, and he used it, for instance, to cover part of the costs of expanding Haus Wachenfeld into a stately Alpine residence, the Berghof.

Most of Hitler’s paladins followed the lead of their Führer and had themselves declared exempt from taxes, acquired luxurious homes and set up special funds, foundations and secret bank accounts shielded from any public financial scrutiny. Göring—the Third Reich’s “second man”—may have been particularly conspicuous with his grandiose lifestyle, including his feudal estate “Carinhall” in Schorfheide, north of Berlin. But other leading figures in the regime were hardly slouches either when it came to unscrupulously abusing their positions for personal gain. Goebbels, one of the more vitriolic critics of “bigwigs” in the Weimar Republic, lived in splendid fashion in his villa on Schwanenwerder Island in Lake Wannsee and had a second home on Lake Bogensee, north of the capital. And despite bemoaning the corruption among the clique of Nazi leaders while writing his memoirs in Spandau prison, Albert Speer was a more-than-willing beneficiary of the system of patronage, concealing his rocketing income from the tax authorities and acquiring an estate in Oderbruch to go along with his large new house on Berlin’s Lichtensteinallee.

Functionaries lower in the party hierarchy, from the Gauleiter on down to the district and local leaders, exploited their respective networks in the same way as the top members of the regime. Wasting public resources, embezzlement, abuse of party funds, shameless greed and crass careerism were part of everyday reality. There was “no combating it,” Fritz Wiedemann reasoned in retrospect, because the Nazified press was not allowed to report on corruption and because Hitler covered up abuses committed by the party’s old guard: “This plague ate its way from the top to the bottom. What was allowable for the bigwigs was also all right for the little guy.”