Fifteen years ago the diplomatic bricklayers at Versailles raised many a high wall around Germany. Since last year Nazi persecution of Jews and Communists has raised several new ones. Last week Prussia's Premier Hermann Willhelm Goring shouted: "The German nation needs room if it is not to suffocate. Germans, too, need air and sun."
Trade Wall. Sir Robert Mond, chairman of the British boycott committee, said last week at Samuel Untermyer's Yonkers, N. Y. home: "The boycott is highly successful. It is a stupendous uprising of outraged humanity. . . ."
How high this trade wall has grown was shown last week in a speech by Nazi Minister of Economics Kurt Schmitt. First he wheedled: ". . . The outside world should recognize that the gigantic efforts the German people and its leaders are making arise from great distress. It would be better if the searchlight were not thrown on our alleged mistakes and shortcomings. . . . Not through mutual throttling of trade or secret joy that things are going worse with our neighbors will the world be put right again."
Next came a double-barreled threat: "If foreign markets remain closed, not only shall we be unable to continue payment of the service on our foreign debts, but the outside world will not be able to sell to us raw materials in such amounts. Germany will find ways to make a virtue of necessity [i. e., paper clothes, acorn coffee, etc.]. Given the present state of our technical methods, it will be not a temporary measure of alleviation but a permanent transformation with immense consequences to world markets."
An angrier note was struck by Reich Commissioner for Justice Hans Frank before Berlin's American Chamber of Commerce: "No boycott will force us to our knees and the world might as well make up its mind that it is no longer dealing with the Germany of Versailles. . . . We have been called Huns and barbarians because we wanted to expand our constitution. Germany does not intend to interfere with the constitutions of other peoples and she will not tolerate foreign interference with her constitution."
Ignoring increases in internal production costs and in raw material imports, boycotters found in Germany's balance of trade figures proof that their campaign was working well. In January Germany's balance of trade showed a deficit of 22,200,000 marks; in February this had mounted to 34,600,000 marks; in March Germany stopped the decline with a small favorable balance, 3,400,000; but in April the deficit showed again, bigger than ever — 82,000,000 marks. Meanwhile the Reichsbank's gold coverage had dwindled to 4.6%. Last week the Nazi Government, responsive to the adverse trade pinch, reduced once more its total allotment of foreign exchange to private German importers. First fixed at 50% of the 1930-31 figure (one-half of normal) early this year, it had been cut to 35% for April, to 25% for May. Last week it all but vanished in the 10% figure for June. At the same time the Government was reducing utilization of reimbursement costs from 70% of the 1930-31 figure for April to 50% for May and last week to 20%.