"Warmest congratulations to the Fuhrer in the name of the bishops and the dioceses in Germany with fervent prayers which the Catholics of Germany are sending to heaven on their altars."
It's reasonable bet that Pious XII wanted to ensure that the money from a cash strapped Reich fighting a super war would not dry up.
During the war the Vicar of Christ was an exemplar of conflicted and contradictory policies and thinking. He played with opposing Hitler to the point of dabbling in a plot against him with the British a violation of the canon against directly opposing tyrants as well as the neutrality of the Vatican nation -- while agreeing with the main Nazis project to destroy the Soviet Union. The self inflated Pious XII imagined he as God's main man on earth could negotiate with Hitler and the allies to end the war at least in the west, perhaps on terms that would allow the godly war against atheistic communism to continue. Despite his heavenly connections, he did not understand that the increasingly crazed Hitler was so pathological that he and his regime of horrors could only be stopped by an extermination campaign of counter conquest via brute military force of the kind Stalin was deploying against him (and only the Red Army was large enough to defeat Germany). How could the future candidate for saint be so obtuse to think that Hitler would agree to willing end of the war when doing so would put the great dictator at high risk of be deposed, exposed and executed? Or did Pacelli see a post war Hitler remaining unpunished and in control of Germany -- like Franco in Spain -- after the war came to a negotiated end? Someone else not deserving sainthood either but much more grounded Roosevelt, knew the score -- he demanded for unconditional surrender at Casablanca as the similarly realist Churchill happily went along.
By the norms of the time a standard anti-Semite -- except for those who converted to the one true faith -- Pious XII did not approve of the genocide he knew was underway to at least some extent via the extensive church intelligence network (likewise most Germans would have objected to the scale of the Holocaust if they entirely knew, that's one reason the regime hid it the project). In 1942 he issued a Christmas statement against Nazis atrocities that perturbed Hitler and company and gave some encouragement to the victims, but it was too bland, indirect and nonspecific to have the needed impact. Far from constantly warning about Nazis terror, to the dismay and anger of many further statements were not released in 1943 and 44 as the Holocaust reached its fantastic heights. When Germans began to remove Jews from Italy to send to the death camps the reaction of Pacelli was again mixed. Many Jews were successfully hidden by Catholic clerics and civilians some in the Vatican -- but over a thousand were deported without the Pope publicly protesting, or showing up at the train station to try and put a stop to the deadly transport.
Defenders of Pious XII fall back on two defenses to try to explain the mediocre performance of their saint-to-be. He would have been under direct threat if he had more directly opposed Hitler, and the Fuhrer would have targeted Germans Catholics like he did the Jews et al. Concerning the direct threat to the Pope, so what? One hopes the Vicar of Christ was not afraid to risk his freedom or even life in the defense of others.
As for the supposed threat to Catholics, it is hard to overemphasize how just plain ignorant this proposition is. Many imagine Hitler was free to do whatever he wished, but being a dictator is such a perpetually dangerous business that tyrants must carefully watch their every step lest it come back to harm or kill them. Hitler could pick on German Jews because the classic "others' made up a mere 1% of the population -- they were vulnerable and expendable. For the Austro-German Catholic Hitler to go after his fellow Austro-German Catholics would have been ethno-suicide directly contrary to his own beliefs and schemes. The two main points of his regime were too elevate all Deutsch Aryans Catholic and Protestant to the near godhood inherent to the race -- not to oppress or eliminate a big chunk of them -- and to use the limited numbers of Germans to conquer an super slave empire extending from the French frontier to the Urals. How was this supposed to work in practical logistical terms if the around 20 million German Catholics were somehow corralled and dealt by the 50 million followers of Luther? All the more so because many Protestants would not have gone along with targeting Catholics; an ecumenical Catho-Lutheran coup more effective than the nearly successful 44 plots would have been a serious possibility. Bad treatment of the third of Germans who were Catholics would have shrunk Hitler's desperately pressed army by the same amount and wrecked his dreams of conquests while leaving the nation vulnerable to attack, and would have risked an outright civil war because Catholic officers and soldiers had lots of weapons. Once the USSR was defeated Adolf needed every German to keep the huge Slavic population in their place as slaves (the central goal in Hitler's inane scheme was its fatal flaw, trying to hold Russia/Ukraine would have been Germany's Vietnam-Afghanistan on a vast scale). The need for as many Aryans as possible was why Hitler banned abortions and favored big German families Catholic and Protestant. Even going after the Pope down in Rome would have outraged the Catholic portion of his nation and army, crippling military moral at best and risking mutiny (the BBC and Soviet broadcasts would have made sure Germans knew what was happening), and gutted his war project. Socio-political historians have shown that Hitler ran a "popular dictatorship' that depended upon a high level of popular support to survive (as it was he barely lived through a long series of assassination attempts). The myth that a small Nazis clique captured a nation and forced an oppressed population to do things against popular will is bogus. The Gestapo was small by the standards of totalitarian states, surviving records show it relied on casual civilian informants to keep malcontents in line. Hitler was far less free to do what he wanted than most think, and he had to be very careful not to go to far against his fellow church members.
Protected by German Catholic and world opinion, Pious XII was much freer to take on Hitler than the reverse. We will never fully know what would have happened had Pacelli issued ringing denouncements of Hitler, and it is true that the Fuehrer would not have personally cared if he were excommunicated for wiping out Jews and the like. But a stark rejection by Pacelli and exposure of the Holocaust machine would have done grave and perhaps crippling damage to the Nazi regime. This may help explain why Pious XII avoided being too explicit -- doing so would have demoralized the Catholic soldiers fighting atheistic Stalinism. Apologists argue that the Nazis really were close to seizing the Pope if he dared go to far. But Hitler never actually dared touch the Pious because Adolf understood that doing so would have shortened the war by speeding up the collapse of Germany, forcing Hitler to kill himself in 43 or 44. It is in that sense it is too bad Pacelli was probably unable to get himself seized by Hitler even if he tried, doing so could have saved a few million.
Again it comes to the money. If Hitler did not need to keep Germany's and the world's Catholics and the international community thinking that the Pope accepted the existence of his regime, then why didn't he cut off the church megapayments when he desperately needed all available cash for the war as it went bad and the noose tightened around his neck? Because Hitler DID fear the condemnation of the man he not only could not touch, but had to buy off. In other words, keeping the Papal criticism sufficiently low was less costly to the war and extermination efforts than sending the churches all the money. And why did Pious XII never reject the transfers of tax revenues from Hitler's treasury -- much of which was looted from the Jews and conquered peoples, and made upon the backs of slaves who suffered under deadly circumstances -- as a moral protest? He did quite the opposite, being careful to never say or do anything that would cause his financial benefactor Hitler so much discomfiture that he cut off the funds. Instead the birthday greetings continued. Whatever the exact motives of both, it was craven mutual back scratching.
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