After the Party was banned in the wake of the Beer Hall Putsch, Schwede became Kreisführer (County Leader) in Coburg for the Völkischer Block, a Nazi front organization active in Bavaria. He also joined the National Socialist Freedom Movement, another front organization, that in the 1924 Coburg city council elections managed to get 14.3% of the vote. This entitled them to 3 seats on the Council and Schwede took one of them. Shortly after the NSDAP ban lifted, Schwede rejoined on 30 March 1925, becoming the Party Ortsgruppenleiter (Local Group Leader) in Coburg, where there were about 800 members at that time, and the Bezirksleiter (District Leader) in 1928. That year he also secured a seat on the Kreistag (District Council) of Upper Franconia. In 1926, Schede founded Der Weckruf ("The Wake-Up Call"), the first Nazi propaganda newspaper at the local level in Germany. Here he ran an extra-parliamentary opposition with lurid articles about alleged "scandals" designed to destabilize the political system of the Weimar Republic. In 1928, the paper began a slander and harassment campaign against Abraham Friedmann, the Jewish General Director of the Coburg meat company Großmann AG. Friedmann was initially successful in fighting these attacks and managed to get the City Council to fire Schwede from his job at the Municipal Works in 1929. The outraged Nazis demanded Schwede's immediate reinstatement and when the city refused a petition began circulating to dissolve the City Council. On 5 May 1929 the recall passed with 67% of the vote. In the ensuing re-election campaign, which included public speeches in Coburg by Adolf Hitler himself, the Nazis won 43.1% of the popular vote and 13 of the 25 seats in June 1929. This was the first instance where the NSDAP held an absolute majority in a local government in Germany. At the newly elected Council's opening session, Schwede was promptly rehired to the Municipal Works. Schwede then managed to get himself elected, after the fifth try, as third deputy mayor (Bürgermeister) on 28 August 1930, becoming the first Nazi to reach such a position. In October 1930, Schwede was elected to the Bavarian Landtag, succeeding Hans Schemm, and would go on to become the chamber's First Vice-President in March 1932. Early in 1931 he was elected second Bürgermeister of Coburg and, on 16 November 1931, first Bürgermeister. Coburg became the first city in Germany to see the swastika flag raised