While Hitler repeatedly declared that Germany had no territorial claims with France, propaganda for the restitution of colonies intensified towards England. Hitler, however, was careful not to repeat the mistake of William II, starting a naval race with England. Von Ribbentrop was in charge of the colonial question, appointed ambassador to London in August 1936, but his conversations with the British minister Halifax did not bring practical results. England declared itself willing to introduce an open door regime into its colonies, not to transfer territories. Colonial propaganda intensified after the meeting of Hitler and Mussolini and a special office was set up for this purpose in October 1937.
This foreign policy was supported by formidable military preparation. On April 28, 1936, General Göring was charged with controlling, with full powers over the entire state administration, all measures relating to the exchange of foreign exchange and the importation of raw materials. Furthermore, for the purposes of the internal production of raw materials and food, Hitler announced on January 30, 1937 a four-year plan, the execution of which was entrusted to Göring, appointed commissioner (March 24, 1937).
In his speech to the Reichstag on February 20, 1938, Hitler could present the following picture of the achievements made by the regime over the five years in the economic field: a total national income rose to 68 billion marks (in 1932: 45.2 billion), while the cost of life had increased by only 4%; an industrial production exceeding 75 billion (in 1932: 37.8); an agricultural production exceeding 12 billion (in 1932: 8.7); unemployment dropped from 6.5 million to 470,000; imports rose from 4.2 billion to 5.5, exports from 4.9 to 5.9; deposits with savings banks rose from 11.4 billion to 16.1; the interest rate on short-term loans increased from 6.23% to 2.93%, and on long-term loans from 8.8% to 4.5%; the revenues of the Reich increased from 6.6 billion to over 17 billion; an increase in the production of hard coal from 104.7 million tons to 184.5, of lignite from 122.65 to 184.07, of steel from 9660 to 19.207, of cast iron from 1.4 to 3.7, of iron from 1.3 to 9.6, etc.; an increase in motor vehicles from one and a half million to three million; an increase in maritime traffic from 36 million tons to 61 million; a 47% increase in freight traffic on railways and 54% in overall rail operation; a grandiose development of road construction on which 1450 million marks were spent in 1937 (in 1932: 440); the construction, in 1937, of 340,000 homes. In the social field Hitler could point out: tariff guarantees, paid holidays, insurance of the right to work, insurance of a minimum income, connection of earnings with returns,
A major school reform, including all grades of schools, from elementary to university, was implemented by Minister Rust.
A sensational reform in the army high command, on February 4, 1938, marked the definitive centralization of power in the hands of Hitler and the elimination of the old conservative elements from the command posts. Marshal von Blomberg, Minister of War (the post had been restored on 22 May 1935) and commander-in-chief of the armed forces, and General von Fritsch, commander of the army, withdrew. Hitler directly assumed the supreme command, assisted by a “Higher Command of the Armed Forces”, headed by General von Keitel, with the rank of minister and the functions of Minister of War. Göring, commander of the air force, was promoted to marshal. At the same time the Foreign Minister von Neurath was replaced by von Ribbentrop, but was placed at the head, as a minister without portfolio, of a “private council” for foreign policy. The Ministry of Economy, formerly held by Schacht, was employed by Funk. The movement was followed by a series of changes in military high command and important diplomatic headquarters. On March 3, the commanders of the army and fleet, General von Brauchitsch and Admiral K. Raeder, were authorized to take part, with the rank of ministers, in cabinet meetings.
According to loverists, the movement, which was placed in relation by the foreign press with alleged conspiracies of generals, should probably be placed in relation to the precipitate of the Austrian question. By now safe from any threat to the western frontier, Germany had been able to gravitate towards the Danube area. After Mussolini, seriously engaged in the Mediterranean, declared that Italy did not intend to remain petrified at the Brenner Pass, the fate of Austria seemed decided. However, the German-Austrian agreement of 11 July 1936 was reached, in which the two parties declared their intention to re-establish friendly relations between the two German states and guaranteed mutual non-interference in internal affairs. The tension, which existed since the time of the putsch attemptNazi in Austria and the killing of the Austrian Chancellor Dollfuss, seemed to have to be mitigated. In reality, the agreement did not bear the hoped-for results: the Nazi agitations in Austria continued, vigorously repressed by the Schuschnigg government, which was trying to reawaken the Austrian conscience in the populations. On February 12, 1938, an attempt was made to compromise: Chancellor Schuschnigg, who met Hitler at Berchtesgaden (see austria, App.), He undertook to adopt a policy of conciliation towards the Austrian Nazi elements. Indeed, a few days later, he reconstituted his government, entrusting the Nazi trustee Seyss-Inquart with the Ministry of the Interior. However, Schuschnigg’s own speech to the Austrian diet on February 24 revealed that the situation was far from clear. A desperate attempt by the Austrian chancellor to save independence by means of a plebiscite provoked a prompt reaction from Hitler. On 11 March, following an ultimatum, Chancellor Schuschnigg left the government that was being taken over by Minister Seyss-Inquart. Hitler sent a message to Mussolini on March 12, in which he highlighted the reasons that had prompted Germany to act in regard to Austria, and crossed the border. Meanwhile, the German troops marched towards Vienna, entering the ancient capital on the morning of 13 March. An Austrian constitutional law sanctioned the immediate union of Austria to the Reich. On March 14, Hitler made his solemn entry into Vienna and received the loyalty oath of the Austrian army. On 10 April a plebiscite sanctioned the definitive incorporation of Austria into the great German Reich (see alsoaustria, App.).
In May 1938 the visit of A. Hitler, welcomed with triumphal honors in Italy (in Rome, Naples and Florence, 3-9 May), confirmed the Italo-German agreement and the Rome-Berlin axis. In the last decade of the same month, a dangerous tension arose with Czechoslovakia, over the question of the Sudetic Germans (see Czechoslovakia, App.).