Messersmith, G.S., Berlin. To William Phillips, Washington.
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University of Delaware Library, Museums and Press
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Returned ten days ago from U.S.; situation in Germany worse than in December; much discontent; prices higher, income down; dissension among party leaders; increased activity in industry, but most of it armaments or uniforms; exports greatly decreased, and unfavorable trade balance makes it difficult to import needed raw materials; Reichswehr still untouched by Nazi movement; commander-in-chief [Werner] von Fritsche and other high ranking officers feel that present state of affairs cannot continue; some talk of Reichswehr establishing military government, with parliamentary background, and perhaps [Heinrich] Bruening to head it; Germany anxious for trade agreement with U.S.; U.S. should not be rushed into agreement, nor extend credit; devaluation of mark almost a certainty; German press announces some concentration camps abolished and many prisoners released; actually, number of camps reduced as economy measure, and prisoners merely transferred to other camps; pleased with appointment to Vienna as it will keep him near to old friends and in touch with situation followed closely for some years.