The statement is not true because of numerous reasons. The first being that most of the people that were performing the genocide were not insane at all. The second, bigger reason is that the German people actually thought that they are doing the right thing in order to secure themselves a better future.
To explain the second one more specifically. The social-nationalist party that was in charge of Germany in this period, with the infamous Adolf Hitler as its leader, managed to use the poverty and the terrible conditions in the country to convince the people that someone else is to blame for that. The someone else were actually the Jewish people. Hitler convinced the Germans that the Jews are holding most of the money in the country, they do not support the society, do not support the development of the country, are very greedy, and that they are the ones that stop the progress of the country. The Germans were in such a terrible state that in the eyes of the ordinary people it seemed logical to be it that, especially because big portion of the Jews had their own businesses. The Germans actually thought that they are destroying the people that hurt their country and their well being, not realizing that they have actually supported another greater evil.
