How does Miss Gates explain why Hitler is able to treat Jews so poorly in Germany?

From the text:

“Hitler is the government,” said Miss Gates."

We said it. Then Miss Gates said, “That’s the difference between America and Germany. We are a democracy and Germany is a dictatorship. Dictator-ship,” she said. “Over here we don’t believe in persecuting anybody. Persecution comes from people who are prejudiced. Prejudice,” she enunciated carefully. “There are no better people in the world than the Jews, and why Hitler doesn’t think so is a mystery to me.”