While said by Holtermann (though in a different sense - saying that after Hitler, the SPD will have to clean up; rather than saying Hitler will radicalize the working classes by his grotesque behavior), it was more prominent as a KPD slogan in opposition to a united front with 'social fascists' (the SPD).
If anybody could find anything at all written in the 1930s saying it's a KPD slogan, and not just people decades later calling it "well known" with no source and only in English with no explanation what it was in German, that would be really cool.
I've found both of those before, the second one quotes it as "Herr Holtermann proudly predicted" so that doesn't work.
The first one based on Google Books is an unattributed chapter title, and searching doesn't find any German words for slogan or motto in it. And Rudolf Olden is prominent enough that I think someone would have cited it by now if he had a KPD attribution in there.
Why did the Marxists fail is the closest I've found, because he doesn't explicitly say who he's quoting. You can read this anthology version of it which unfortunately edits out the actual quote, but Olden is very critical of the SPD for acting like there was an electoral or legal solution to Nazis instead of planning for a civil war, so I really think he's quoting Holtermann.