Much of the effectiveness of Mother Night, like that of Slaughterhouse-Five and other Vonnegut novels, is based on the ironic tone in which the stories are narrated. Howard Campbell is a man who is clearly a war criminal, even if he has secretly been an American operative sending coded messages. Campbell is aware of his hypocrisy and the wrongs he has committed, yet he tells the story in a matter-of-fact way, at times as if almost amused by it.
Even the point deep into the novel when Campbell stops dead in the street and says he has no ability to go on, to continue with any movement or action, seems almost a parody of the thoughts that must occur to a suicidal person. There is a schism implied (as a subtext of the narrative) between the awesomeness of the evil committed by Campbell himself and the Nazis and the bizarre surface detail and tone of Campbell's telling of his story.
One has to ask if only a completely amoral person would become a propagandist for the Nazis under any guise or for any pretext, even if it were to help the Allies. The difference between pretending to be something and actually being something is blurred in Mother Night. It is another take on the illusion versus reality theme, but with the twist that Campbell himself does not seem deluded by it, or by what he has become.
The root of the term schizophrenia is "split mind," which applies not only to Campbell but others in the novel such as the American officer, Wirtanen, who recruits him. But in technical usage, the term refers to a category of mental illness that differs from the popularly-known "multiple personality" syndrome often shown in literature and film. In actual schizophrenia, the patient is disconnected from reality, perceiving the world in an aberrant manner, often with elaborate paranoid delusions.
Campbell outwardly does not seem psychotic. He appears to be rational in the way he tells his story, but the impression one gets is that a rational person, whose perception of the outer world is normal, would not have acted as he did. This is the deeper sense in which "schizophrenia" is applicable. The historical Nazis like Goebbels and Eichmann who appear in the narrative were not raving lunatics either, but only psychotics would have committed the crimes they did.
The epigraph of Mother Night is significant. It is a quotation from Walter Scott's The Lay of the Last Minstrel:
Breathes there the man with soul so dead,
Who never to himself hath said,
"This is my own, my native land"?
Campbell actually is such a man. That his soul has lived but has been "dead" is the most fundamental kind of "schizoid" quality he possesses.