Chasing Gold: The Incredible Story of How the Nazis Stole Europe's Bullion (15 page)

Schuschnigg played for time by explaining that under the Austrian constitution only the president had the power to accept the agreement and carry it out. Hitler exploded and ran to the door, shouting to General Wilhelm Keitel, the Supreme Commander of the Armed Forces and a Führer favorite, to join him. Turning to Schuschnigg, Hitler bellowed, “I shall have you called later.” Once outside the room, Hitler smiled and told the general that he had no orders to give him. Keitel was simply a bit player in a
pièce de théâtre
to scare the Austrian chancellor.

After letting his guest stew for half an hour, Hitler sent Schuschnigg a message saying that he wanted to see him. When the Austrian arrived, the Führer said, “I have decided to change my mind—for the first time in my life. But I warn you. This is the very last chance. I have given you three additional days to carry out the agreement.”

Schuschnigg returned to Vienna, and Austrian political leaders wrestled with how to avoid the inevitable. On February 15, the deadline, the government finally gave in. The next day Vienna granted an amnesty to all Nazis and reorganized the cabinet to include Nazi representatives. Five days later, Hitler made a speech to the Reichstag, thanking Austrians for the concessions and for agreeing to new and closer relations between the two countries. At the same time, he issued an ominous warning: “Over 10 million Germans live in two of the states adjoining our frontiers . . . It is unbearable for a world power to know there are racial comrades at its side who are constantly being afflicted with the severest suffering for their sympathy or unity with the whole nation.” That was a none-too-subtle reference to the seven million Austrians and three million Sudeten Germans residing in Czechoslovakia.
⁸

Hitler named Wilhelm Keppler his commissioner for Austrian affairs. He was already
Statβecretär
, the number-two position, at the foreign ministry. Keppler was a veteran Nazi and member of the much-feared
Schutzstaffel
. He had joined the party in 1927 and by 1931 was an economic advisor to Hitler. While working at the Reich Chancellery, Keppler formed a group made up largely of business leaders called the
Freundeskreis der Wirtschaft
(Friends Economic Circle). Göring considered him weak, but Hitler liked him. In early March he made a first visit to Vienna in his new role. While there, he met with leading Nazis and with Schuschnigg. Upon his return to Berlin, Keppler briefed Hitler, who was pleased with how things were going.

On the morning of March 8, however, a top Austrian Nazi called Keppler with the rumor that Schuschnigg was going to hold a plebiscite on the question of union with Germany. The information was immediately passed along to Hitler, who doubted it but nonetheless told Keppler to take a government plane back to Vienna and check things out on the ground.

The scuttlebutt was correct. On the evening of March 9, Schuschnigg announced at a rally in Innsbruck that a national plebiscite would be held the following Sunday, only four days later. The Austrian people would be asked to respond either
Ja
or
Nein
to one question: “Are you for a free, German, independent and social, Christian and united Austria, for peace and work, for the equality of all those who affirm themselves for the people and Fatherland?”
⁹

When Hitler learned of the referendum, he blew up and ordered that plans for an invasion of Austria be drawn up immediately. The vote had to be stopped! The Führer immediately called Göring, who was relaxing at his Carinhall retreat. As they discussed next moves over the phone, it quickly became clear that Germany would respond militarily. Keppler returned from Vienna to get a lay of the land, while Göring left for Berlin.

The following day was hectic in both Berlin and Vienna. Göring’s worries about Keppler had been born out, and the report he presented to Hitler at 10:00 A.M. was a masterpiece of indecision. The Austrian Nazis could not agree on a clear strategy, and he sided with moderates who wanted to let events play themselves out. That was not good enough for Hitler, who had built up a great army and now wanted to use it.

Hitler’s only real concern was whether a military action against Austria would push Italy’s
Duce
Benito Mussolini to action. The Italian considered Austria to be his protectorate and a symbol that Rome was once again a world power. Hitler feared that if the Italians mobilized their army, France and Britain might take similar steps. In 1934, when Nazis killed the Austrian Chancellor Dollfuss, Mussolini had mobilized five divisions to forestall any German action. After the confrontation at Berchtesgaden, Schuschnigg instructed his military attaché in Rome to meet with the Duce and explain what had happened. Mussolini doubted the Germans would act, saying confidently, “This is something they will never do. We have Göring’s word of honor.” Il Duce also told the Austrian that the plebiscite was a mistake.
¹⁰

Meanwhile in Berlin, Hitler told General Wilhelm Keitel, the new Supreme Commander of the Armed Forces, that if the Austrians went ahead with the vote, he would invade. Keitel had Colonel Alfred Jodl bring him the Special Case “Otto” plans for an invasion of Austria. The report was skimpy and had been drawn up in case the Austrians tried to restore the monarchy headed by Otto Von Habsburg. “We have prepared nothing at all,” reported General Ludwig Beck, the head of the general staff.

When Beck met with Hitler, he told him bluntly, “I cannot take any responsibility for an invasion of Austria.” The Führer responded that his own
SS
troops could then carry it out. “They will march in with bands playing. Is that what the army wants?” Later Jodl sent a message to the armed forces telling them that if they encounter Czech troops during the invasion they should treat them as enemies, but any Italian ones should be “treated as friends.”
¹¹

The German generals didn’t need to worry about London or Paris. The new government of Neville Chamberlain was anxious to get along with Hitler, and once again a French government was falling. The French thought little of the new British prime minister, joking that his name as a pronunciation pun was “
J’aime Berlin
” or “I love Berlin.” During a rambunctious session of Parliament, Chamberlain said little more than, “I have no statement to make.” Ribbentrop traveled to London and met with both him and his new foreign secretary Lord Halifax. After the talks, the German sent a cable to Hitler saying, “England will do nothing in regard to Austria.”
¹²

In the early afternoon, Keppler was handed a message significantly addressed to him as
SS Gruppenführer
. It provided a list of the Austrian Nazis or party sympathizers who were now supposed to run the country. At the top was the name Dr. Arthur Seyss-Inquart. He was a trained lawyer who had grown up in the mixed ethnic area of the Austro-Hungarian Empire. He had been associated with the Austrian Nazi Party since 1931, but did not actually join it until the day after the
Anschluss
. In the Schuschnigg government he had held the crucial post of Minister of Security and Interior.

The Austrian government continued to organize the referendum that was now only three days away. Schuschnigg had a long talk that evening with Seyss-Inquart, who complained that he had not been informed in advance about the plebiscite. Since he didn’t have instructions yet from Berlin, he only argued about a few technical issues. At the end of the conversation, he said that his followers would vote for the referendum. Demonstrators both for and against the referendum filled the streets of Austria that night, and a whiff of civil war was in the air.

At 2:00 A.M. on March 11, the Berlin government issued Directive Number One for Operation Otto. It instructed the German army and air force to be ready to invade Austria at noon the following day “at the latest.” Hitler wanted to take action before the scheduled referendum.
¹³

At 5:30 that morning, the phone rang in Chancellor Schuschnigg’s bedroom. The Austrian chief of police informed him that German troops had closed the border at Salzburg, stopping rail traffic between the two countries. Military forces were also building up just over the border. An hour later, Schuschnigg headed for his office, but stopped at St. Stephen’s Cathedral to attend mass and pray for his country. As he sat in the last pew, the chancellor could only think of the phone call warning. By the time he got to his office, a telegram from the Austrian Consul General in Munich had arrived with the cryptic message, “Leo ready to travel.” The chancellor knew that meant the German army was preparing to invade.

At 11:30 A.M., Arthur Seyss-Inquart arrived at the Vienna chancellery with Edmund Glaise-Morstenau, the vice chancellor in Schuschnigg’s cabinet, who had just flown back from Berlin with a letter demanding that the plebiscite be put off for several weeks. In the early afternoon there ensued a series of threatening phone calls that involved Göring in Berlin, who was working out of a phone booth at the chancellery. He was now the puppet master, pulling strings from afar. Seyss-Inquart first presented Schuschnigg with Hitler’s order that the plebiscite be called off “within the hour.” The Austrian leader refused to comply, but went to see President Wilhelm Miklas, the head of state. The two finally agreed at 2:00 P.M. to comply with the German demand and cancel the referendum. Seyss-Inquart informed Göring by phone at 2:45.
¹⁴

Twenty minutes later, Göring was back on the phone orchestrating a
coup d’état
in Vienna. He told Seyss-Inquart that he and all the Nazi cabinet ministers should resign. In another call less than an hour later, Seyss-Inquart told Göring that Schuschnigg was on his way to the office of the Austrian president to hand in his resignation. Göring responded that a new government had to be in place by 7:30. He added that the referendum also had to be cancelled and that Keppler would be returning to Vienna with the list of new cabinet members. Göring also said that military units would be arriving soon and would be at Seyss-Inquart’s disposal. He was also instructed to send Berlin a message asking for German troops to reestablish law and order in the country.

In the middle of a phone call, however, Göring learned that the Austrian president was refusing to appoint Seyss-Inquart. A furious Göring bellowed into the receiver that German forces in that case would march that night and, “Austria will cease to exist . . . There is no time now for jokes.”

While frantic phone calls between Berlin and Vienna continued, Prince Philip of Hesse at 10:25 P.M. telephoned Hitler from Rome. The prince said he had just left Mussolini’s office in the Palazzo Venezia with the news that the Duce “accepts the whole thing in a very friendly manner” and “sends his best regards.” Hitler was elated and asked the prince to “please let Mussolini know I will never forget him for this. . . . never, never, never, whatever happens.” The Führer also sent Mussolini an effusive cable repeating that message. The Nazis could now move in for the kill without facing military opposition.

Schuschnigg that evening went on Austrian radio and told his countrymen what had transpired, saying in conclusion, “President Miklas has asked me to tell the people of Austria that we have yielded to force since we are not prepared even in this terrible hour to shed blood. We have decided to order the troops to offer no resistance.” It was after midnight, when Seyss-Inquart drove his predecessor home through streets where Austrian Nazis were celebrating their victory.

While all the cabinet shuffling and threats were taking place over the phone, Reichsbank president Hjalmar Schacht was in Berlin participating in pre-invasion planning with the Wehrmacht’s economic staff. He had long been an advocate of a union between the two countries, arguing that Austria was too small to be economically viable, and merging its financial coffers with the Reichsbank would certainly be advantageous. Lt. Colonel Hans Wiedemann from Hitler’s office asked Schacht how currency policy for the united country should be handled. The central banker said the exchange rate should be fixed at one Reichsmark to two Austrian schillings, even though that country’s currency was trading at the time for about one mark to 1.1 schillings. The under-valuation of the Austrian currency made anything the Germans bought in Austria about half price, and that became the Nazi policy in all countries it later invaded. This manipulation of exchange rates became one of the most successful tools the Nazis had to exploit occupied countries throughout World War II. Occupying German soldiers lived like kings and shipped back home huge amounts of local products at bargain prices. That gave Germans both at home and in occupied nations a much higher standard of living, making the Nazi government even more popular.
¹⁵

At 8:45 that same evening, Hitler signed Directive No. 2 instructing German troops to begin entering Austria at daybreak the next morning. Only three minutes later, Göring dictated a telegram to Keppler that was to be given to Seyss-Inquart. It stated that he should send Hitler a message asking him “in order to prevent bloodshed . . . to send German troops as soon as possible.”
¹⁶

At daybreak on March 12, German units marched into Austria at six border crossings. They faced no opposition. By then Nazi paramilitary units were already on the streets of the Vienna, and Austrian Nazis were helping execute the country’s quick takeover. Wehrmacht planes flew over the capital dropping leaflets that read: “National Socialist Germany greets its possession National Socialist Austria and its new government in true indivisible union.”

That same day, Reichsbank director Karl Friedrich Wilhelm flew on a government plane to Vienna with instructions to oversee the financial takeover of Austria. He was under strict orders to insist on the Reichsmark-Austrian schilling exchange rate Schacht had set. When Wilhelm got to his hotel in a truck requisitioned from the national post office, he telephoned the Reichsbank in Berlin, and officials again repeated the order that the exchange rate should be one Reichsmark for two Austrian schillings. He was also told to be at the Vienna central bank the following morning at 11:00 to meet with the president and director general.