That year of 1942—as all the historians point out—marked the high point of Axis expansionism. We have wiped much of it from our memories with the hindsighted rationalization that manpower and productivity made the Allied victory inevitable, but that was not necessarily the case in early 1942; the issue was still seriously in doubt before the strategic turning points at El Alamein, Stalingrad, Midway and the rest. Hitler and Mussolini and Tojo did have world conquest within their grasp for a brief while; it slipped quickly beyond reach but it was not inevitable that this happen.
Nevertheless, even in those months there were noticeable weaknesses, in the German system of conquest. In spite of their masses of imported slave laborers from the conquered nations, the Germans had a limited manpower of “pure Aryans” who were thereby qualified, according to the sick standards of Nazi bureaucracy, for service to the Fatherland. Limited manpower meant limited productivity, even in a nation as highly industrialized as the German Reich. Technological advances and the use of slave labor helped to offset these weaknesses but technology was hideously expensive and the German economy became daily more unstable because its real productivity never matched its monetary needs for financing the war.
The result was that Hitler was chronically broke. Theft—even the wholesale rape of national treasuries in the conquered lands—was not enough to feed the ravenous war machine. There were vital foreign products and raw materials which had to be imported from neutral trading countries. The neutrals always demanded hard currency and the Deutschmark was not considered a hard currency anywhere outside the Axis sphere. Hitler needed gold.
He thought he had it in 1938: five hundred and ten tons of gold that had belonged to the Spanish Republic. Most of it was earmarked by Franco for payment to Germany in return for Nazi aid in the Spanish Civil War. But the Republicans in Spain had followed the example set by the Russian monarchists: they had taken their gold into exile with them. It went from Barcelona to Odessa aboard several ships and was taken to Moscow “for safekeeping.”*
In 1940 the French treasury had been spirited to England via a roundabout route, a few jumps ahead of the blitzkrieg. The other occupied territories in Europe and Africa had no vast hoards of gold or hard currency with which to support Hitler’s needs. In the meantime steady inflation was doing morale no good on the home front and Berlin was increasingly hard pressed to meet its foreign-payment commitments.
Under those conditions it isn’t surprising that any rumor of billions of reichsmarks’ worth of gold bullion, no matter how far-fetched, would trigger an eager response among the leaders of the Third Reich.
In the Alexandria archives I found several directives from General Franz Halder, Hitler’s army chief of staff, to von Paulus and Guderian and other field commanders in the spring and summer of 1942, indicating Hitler’s avid interest in the Soviets’ treasure vaults in the Ural Mountains. I found one top-secret memorandum from Halder to OKH Headquarters Rostov, requesting a feasibility analysis for implementing a coordinated parachute and armored raid into the Urals. The memo suggested a meeting between von Paulus, Guderian and one of Goering’s visiting Luftwaffe generals; the suggested plan was to drop a parachute commando that would break open the Russian mountain vaults while one of Guderian’s crack Panzer units made a run across the Volga to rendezvous with the parachute team. Then the Soviet and Spanish treasure would be brought out of the USSR aboard armored troop carriers and tanks.
I found no record of any such meeting taking place, nor did I find any reply to this memo. One can guess what such a reply would have contained. The distances were far greater than Hitler seemed to imagine (and the pipe dream has an unquestionable flavor of Hitler about it; clearly it wasn’t Halder’s idea—he was too level-headed an old soldier). There was no possibility of getting an armored column that far behind Russian lines, nor was it likely that a paratroop invasion would have cracked the well-guarded Russian vaults. In fact I found no evidence that the Germans had any decent intelligence of the location, let alone the defenses, of the Soviet gold vaults.
In any case nothing came of it, but I did find a fair number of OKH directives urging the Wehrmacht to drive across the Don and the Volga in a spearhead aimed at the Urals. The gold vaults were mentioned several times among the various strategic reasons for pursuing this dubious plan. (The German army did in fact reach the banks of both rivers, but never crossed them.)
Then on September 12, 1942, Halder directed von Paulus to “proceed with an investigation” of the “reported Tsarist gold”—its validity, location and accessibility. In the light of later discoveries I decided that this directive was only supplementary to investigations that were already under way by Gestapo and SS officials, but this Halder cipher was the first reference to Kolchak’s gold I had come across and I felt a disturbing excitement.
Halder and the Fuhrer had a falling-out at about that time; Halder was relieved of his position as chief of staff on September 24 and was replaced by General Kurt Zeitzler, an arrogant youth from the Western Front who removed the last vestiges of Officer Corps dignity from the high office and became nothing more than a rubber stamp for Hitler. From that point forward in the history of the Third Reich, up to Guderian’s replacement of Zeitzler, the records of the C-of-S become much less enlightening and it isn’t surprising I didn’t find any further references to the gold in Zeitzler’s files. Very little of any importance went through his hands; for all practical purposes Hitler became his own chief of staff.
My next encounter with the gold was in a dispatch from Waffen SS Standartenführer Heinz Krausser which had been forwarded to Himmler in Berlin over the countersignature of Gruppenführer Otto von Geyr, with endorsements by various SS Sturmführeren and an Obergruppenführer. The dateline—September 13, 1942, Poltava—placed the writer in a town that had recently fallen into German hands on that date; and von Geyr, to whom it was addressed, was at that time in Kiev headquarters on the staff of a Waffen SS combat division. Krausser, the writer, evidently was a full colonel in command of a battalion of killers, Einsatzgruppe “E,” and therefore it was clear that von Geyr was not Krausser’s direct superior officer; both were members of the Waffen SS but there was a vast distinction between combat soldiers and Einsatzgruppen.
The Einsatzgruppen were battalion-strength (700 to 1,000 men) units of Gestapo, SD and Waffen SS commandos. They were originally under the direct control of Reinhard Heydrich and had been trained in the techniques of annihilation at a police academy on the Elbe at Pretsch. They had been indoctrinated chiefly in master-race ideology and the methods of genocide; the stated purpose of these murder battalions was the extermination of Jews in the conquered territories, under the authority of the Führer’s order of March 3, 1941, that the Jewish Question was to find its Final Solution in mass executions.
Krausser’s dispatch was attached to a dim carbon copy of a summary battalion report over his own signature which coldly spelled out the massacres of several thousand Russian Jews and summarized the incredible fact that over the past year this single Einsatzgruppe had murdered more than three hundred thousand Jews.* Krausser’s letter expressed pride in these accomplishments, mentioned that he hoped von Geyr was in good health—evidently they shared in-laws in common or were otherwise distantly related—and went on to explain in some detail the information he had unearthed concerning the Czar’s gold treasury.†