LOUIS P.

LOCHNER
__.._...
,;,--

TYCOONS and TYRANT

German Industry from
Hitler to Adenauer

HENRY REGNERY COMPANY

Chicago 1954
Copyright 1954 by Henry Regnery Company, Chicago, Illinois. Copy-
right under International Copyright Union. Manufactured in the
United States of America. Library of Congress Catalog Card Number:
54-10443
 G. L .
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\..,: ~\.'1.

FOfe\vord

h e task undertaken in this book is that of presenting

as factual a picture as possible of the relationship be-
tween German industry on the one hand and the German
government and German political parties on the other,
during the period of Adolf Hitler~s rise and accession to
power and during Chancellor Adenauer's first term.
The main emphasis will be on so-called heavy industry
because of its transcendent importance in the economy
of western Europe. But a tour d'horizon is also taken of
the rest of Germany~s complicated and intricate eco-
nomic apparatus.
Certain assumptions concerning German industry
have become firmly fixed in the minds of millions. They
may be summed up as follows:
German industry placed Hitler in the saddle;
German industry supported Hitler because he prom-
ised to abolish the trade unions;
German industry wanted war and conspired with
Hitler to provoke it;
German industry offered no resistance to Nazism.
My interest in ascertaining the facts regarding these
assumptions stems from the circumstance that I became
intimately acquainted with Germany as staff member
and for fourteen years chief of the Berlin Bureau of The
Associated Press of America. I had cultivated contacts
in every direction and had met persons in key positions
everywhere during my twenty-three years in the country
of my forebears. My knowledge of Germany had been
further augmented during my service as war correspond-
ent and later as a member of the Herbert Hoover Eco-
v
 TYCOONS AND TYRANT

nomic Mission to Germany and Austria appointed by

President Truman in 1947.
Preliminary inquiries indicated that the most complete
documentation for my studies existed in the archives of
the Industrie- und Handelskammer of Essen. This or-
ganization was willing to grant me unrestricted access
to its voluminous material. I was further assured that
my friends of prewar days and the authorities of the
young German Federal Republic would cooperate in
every way possible.
I decided first to saturate myself with the basic facts
and questions involved, and spent several months delv-
ing into the Essen records. These yielded many an inter-
esting fact never previously published. The dust which
had settled on many folders seemed to signify that much
of this material was headed for oblivion unless someone
took the trouble to exploit it.
My newspaper experience has taught me the value of
the personal interview, the man-to-man give-and-take
of conversation and discussion. I therefore next went
on a series of journeys to leading German centers, visit-
ing, among others, Bonn, Berlin, Hamburg, Bremen,
Cologne, Krefeld, Frankfurt, Munich, Mannheim, Augs-
burg, N iirnberg, Heidelberg, Stuttgart, Friedrichshafen,
and especially the industrial cities of the Ruhr-Duis-
burg, Dusseldorf, Dortmund, Miilheim, Gelsenkirchen,
Wuppertal, besides Essen. The fact that the Department
of State during the summer of 1953 sent me to some
thirty German cities to address audiences in German in
our America Houses further contributed to my under-
standing of the German scene.
I was primarily concerned about meeting two types
of men: one, the rapidly dwindling number of captains
of industry in the age groups around and beyond seventy
who had been in commanding positions before and dur-
vi

~ ·.
 FOREWORD

ing the Hitler regime; the other, the leaders of the young
generation whose attitude will determine the course of
German industry in the years ahead.
Among the representatives of the older generation to
whom I spoke were the following (since nearly every-
body in Germany in a responsible position holds a doc-
tor's degree, the reader may assume that all persons
mentioned in this foreword should be addressed Herr
Doktor): Hugo Eckener, John Alfred Edye, Friedrich
Flick, Abraham Frowein, Theo Goldschmidt, Ludwig
Kastl, Hermann Kellermann, Leisler Kiep, Clemens
Lammers, Richard Merton, Georg Miiller-6rlinghausen,
Alfred Petersen, Albert Pietsch, Paul and Hermann
Reusch, Paul Walter Rohland, Albert Schafer, Martin
Sogemeier, Friedrich Spennrath, Hugo Stinnes Jr., Fritz
Ter Mer, and Gustav Winkler, as well as available mem-
bers of the former Krupp management, Alfried Krupp
von Bohlen, Fritz von Bulow, Arno Griessmann, Fried-
rich Janssen, Karl Pfirsch, and Baron Tilo von Wil-
mowsky.
Of younger industrial leaders I visited, among others,
Erik Blumenfeld, Berthold von Bohlen, Vicco von Biilow-
Schwante, Felix Ehrmann, Gotthard von Falkenhausen,
Fritz Gummert, Fritz Wilhelm Hardach, Hermann
Hobrecker, Max Ilgner, Heinrich Kost, Hans-Helmut
Kuhnke, Ferdinand Porsche Jr., Emil Pouplier, Ernst
von Siemens, Rudolf von Waldthausen.
Visits to Bonn resulted in informative talks and illu-
minating discussions with President Theodor Heuss,
Chancellor Konrad Adenauer, Minister of Economics
Ludwig Erhard, Finance Minister Fritz Schaffer, For-
eign Secretary of State Walter Hallstein, and with var-
ious departmental heads including Felix von Eckardt,
Otto Lenz, and Rudiger Schmidt.
I also sought information from political leaders, past
vii
 TYCOONS AND TYRANT

and present, not now in the Bonn government-men like

Karl Arnold, Heinrich Bruning, August Dresbach, Willi
Eichler, Ernst Lemmer, Paul Lobe, Hans von Raumer,
Ernst Reuter, Carl Christian Schmid, Carlo Schmidt,
Friedrich Stampfer, and Karl Strolin.
Economic experts, writers on economic subjects, legal
counsel for large corporations, archivists, executive di-
rectors and secretaries of chambers of commerce, con-
fidential secretaries, and technical heads in industrial
undertakings further contributed to my knowledge.
Among these I recall the names of Hellmut Bauer, Curt
Bley, Professor Gotz Briefs, Eugen Bunzl, Heinrich
Butefisch, Father Marcus Corman, Pastor Arnold Dan-
neumann, Pastor Johannes Dohring, Professor Walther
Ddiwes, Carl Driever, Heinrich Droste, Curt Duisberg,
Hans Fetzer, Professor Hans Ficker, Hans Flachsner,
Friedrich Ernst, Heinrich Gattineau, Ferdinand Harecke,
Paul Hansen, August Heinrichsbauer, Jacob Herle, Pro-
fessor Kurt Hesse, Lorenz Hocker, Walter Hoffmann,
Rolf M. Hoppe, Walter Hummelsheim, Gunther Joel,
Martin Johannsen, Otto John, Franz Kaufhold, Arthur
Klotzbach, Otto Kranzbiihler, Wolfgang Kuster, Erich
Lichtenstein, Bishop Hanns Lilje, Charlotte Ludwig,
Friedrich Wilhelm Mewes, Eugen Mundler, Maximilian
Muller-Jabusch, Heinz Nagel, Otto Fr. Petersen, Wolf-
gang Pohle, Professor Albert Prinzing, Hans Rechenberg,
Eggert Reeder, Fritz Sanger, Erich Schneyder, Paul
Sethe, Bernhard Skrodzki, Johannes Schafer, August
Schmidt-Hopker, Gustav Schwartz, Wilhelm Steinberg,
Josef Winschuh, H. D. von Witzleben, Helmuth Wohl-
that, Hugo Wriezner, and Manfred Zapp.
To all these and any whom I should have mentioned
but inadvertently omitted I extend my heartfelt thanks.
LOUIS P. LOCHNER

viii
 Contents

Foreword v
Chapter
1. Confusions and Doldrums of the Early
Thinaes 1
2. Attitudes toward Adolf Hitler 10
3. Dominant Figures in German Industry 29
4. Hitler's Industrieklub Speech 79
5. German Industry and Hitler's Finances 91
6. German Industrialists and the Trade Unions 125
7. A Brief Political Honeymoon 136
8. "Gleichschaltung" of German Industry 153
9. Disillusionment at Home; Cheers Abroad 170
10. Did German Industry Want War? 188 o/

11. Compliance and Resistance 212

12. Forced Labor, Spoliation, and Scorched Earth 285
13. Whither German Indus~r? 257 ~
14. America and the Federal Republic of
Germany 283
~-
Index 295
.......
Tycoons and Tyrant
 CHAPTER ONE

Confusions· and Doldrums

of the Early Thirties

h e attitudes and actions of Gennan industry imme-

diately before and during Adolf Hitler's dictatorial reign
can be understood only if one recalls the situation which
the German people at large faced in the early thirties.
The financial crash in New York of October 1929
which ushered in our Great Depression had had espe-
cially grave repercussions in Germany, tied as she was
to the American economy. Huge loans had been granted
by Wall Street, with the aid of which the German rep-
arations payments and the Reich's postwar reconstruc-
tion projects were largely financed.
Parliamentary government was already in dire straits.
The acrimonious debate over the adoption of the Young
Plan for the definitive settlement of German reparations
had reached a new low in political fanaticism, coupled
with character assassination of the opponent. Even the
aged second president of the Weimar Republic, Field
Marshal Paul von Hindenburg, was not exempt from
calumny. Gustav Stresemann, the outstanding German
. foreign minister of the period, had died on October 3,
1929. In the hope of forestalling chaos, Hindenburg
early in 1930 had prevailed upon the new leader of the
1
 TYCOONS AND TYRANT

Catholic Centrist Party, Dr. Heinrich Briining, to accept

the position of chancellor of the Reich. This self-effac-
ing, studious, ascetic, then forty-four-year-old bachelor,
whose principal relaxation consisted in reading books on
economics, subjected his country to an austere program
of deflation which netted him the cruel epithet of
'nunger chancellor."
Conditions in the Reichstag, or parliament, were too
hectic to render orderly legislative process possible.
Unpredictable ballot combinations of the deputies rep-
resenting twelve political parties 1 upset all prognosti-
cations. So bitter was the enmity, for instance, of both
the National Socialists of the right and the Communists
of the left toward the Briining government that these
two archenemy parties occasionally joined hands to vote
down measures proposed by the hard-working chan-
cellor.
Briining saw no other recourse for saving German
democracy except the paradoxical one of invoking a
dictatorial device essentially repugnant to him. Article
48 of the Weimar Constitution authorized the president
of the Reich in times of national emergency temporarily
to suspend a number of fundamental rights guaranteed
by the constitution. With the president"s blessing, Brun-
ing enacted a number of sorely needed measures by
presidential decree rather than by legislative approval.
This is not the place to enlarge upon the disgusting
intrigues by which distrust in his sagacious chancellor
was sown in the breast of the senile field-marshal pres-
ident. Suffice it to say that Briining was booted out of
office on May 30, 1932, just as he was about to succeed
at home and abroad. The two chancellors who followed
1. Actually thirty-six political parties then existed in Germany but
only twelve of them marshaled enough strength to elect national
deputies.
2
 THE EARLY THIRTIES

him in quick succession, Franz von Papen in June and

Kurt von Schleicher in December, were equally unable
to cope with the difficulties.
As an incompetent Reichstag muddled along without
getting anywhere, the people grew more and more dis-
gusted and despondent. Election after election and
Reichstag dissolution after dissolution brought no clear-
cut mandate to any party to take the lead.
Under the proportional representation system of the
Weimar Constitution, seats in the legislative bodies were
allotted on a pro rata basis of the votes cast. Deputies
were not chosen directly by their constituents, but each
party registered a list of candidates larger than the num-
ber of deputies it could reasonably expect to see elected.
The party bureaucracy determined the order in which
its candidates were placed on the ticket. Naturally,
"safe" places were assigned to those whom the party
machine deemed most important. A candidate's name
could either be registered as that of a deputy-at-large
or as representing a geographical district, or both. The
party bureaucracy decided, after the results were in,
which of the two possible mandates the successful can-
didate was to accept, and into which place the man next
on the list was to move. It was a complicated system
which, every time it was used, enlarged the chasm be-
tween the political party machines and the electorate.
The voters had merely the choice of parties for which
to vote, but could not hold the individual representative
responsible. It is not too harsh to assert that the Weimar
Republic, despite its democratic constitution as drafted
in 1919 during the uneasy days following a lost war by
well-meaning, convinced liberals, had not developed
into a model democracy. Here was a state, in which the
bureaucracy became as powerful as in the Franklin D.
Roosevelt era in America, suddenly and without prep-
S
 TYCOONS AND TYRANT

aration catapulted into a republican form of government.

Officialdom continued to dominate not only in govern-
ment but also in the political parties, in the trade unions,
7
and in their opposite numbers, the employers various
organizations.
The word amtlich (official), a magic one for insuring
obedience and discipline on the part of Germans in vir-
tually every walk of life, had lost little of its glamor when
the young German Republic succeeded the imperial re-
gime. Nor has it, for that matter, been divested of its
potency even today. Anything labeled amtlich ( espe-
cially if delivered by anyone in uniform), whether issued
by a government office, a trade union headquarters, a
7
stamp collector's secretariat, or a Iadies sewing circle
treasurer, somehow seems to elicit at least respect, if not
obedience and compliance.
Party doctrines altogether too often commanded
higher loyalty on the part of the chosen representatives
of the people than did responsibility for the common
good. Fraktionszwang (compulsory voting by all dep-
uties of a given party as the majority agreed or as the
floor leader was authorized to demand) meant that a
deputy might be forced to vote against his own con-
science on pain of exclusion from his party. The Centrist
deputy, Adam Stegerwald, former Prussian premier and
later Reich minister of labor, apostrophized the Reichs-
tag as an I nteressentenhaufen, meaning a herd repre-
senting not principles, but special interests.
Germans generally were disgusted at the failure of
parliamentarism as such. They had also, however, lost
faith in the leadership of the bodies created by them-
selves for the protection of their special interests-the
trade unions, for instance. Not that these were corrupt;
they had merely become too bureaucratic, also in a sense
4
 THE EARLY THIRTIES

too obese, for prompt, energetic action in moments of

crisis.
The Social Democratic and Centrist Parties, which,
more than any others, had carried the heavy load of
responsibility for the administration of the struggling
Weimar Republic, had grown tired, just as American
political parties grow tired if in office too long, and
proved barren of constructive ideas that could fill the
masses with new hope. The bourgeois parties to right
of center, both democratic and conservative, were de-
bilitated by internecine strife and misdirected energies.
The cry for the ustrong armn became more and more
persistent as men of affairs saw their interests increas-
ingly jeopardized by progressive political chaos.
Industry was in the doldrums. Countless undertakings
either closed down altogether or employed labor on a
part-time basis only. The number of jobless rose to a new
high of between six and seven million willing hands who,
instead of doing constructive work, spent dreary hours
standing in line to receive a meager dole. It was a period
of hopelessness, listlessness, and despair. Communism
was dangerously on the increase.
The near-chaos of the time bore down severely upon
the Ruhr region. Coal kept piling up at pit after pit in
this heart of German industry. Operators were at their
wits, end what to do with their kumpels.2
Coal, it must be remembered, forms the basis of the
industrial structure of the Ruhr. Even today, Western
Germany still has thirty-five per cent of Western Eu-
rope,s reserves of coal and seventy per cent of the re-
serves of coking coal. Nowhere else in all Europe is such
good coking coal to be found.
Resting upon the great advantage of cheap coke and
2. Colloquial German for coal mine workers.
5
 TYCOONS AND TYRANT

gas, a second great industry-steel-came to be almost

synonymous with the Ruhr.
Six great iron and steel undertakings dominated the
Ruhr: the Vereinigte Stahlwerke, a merger of seven
major groups of basic (Thomas), open-hearth and elec-
tric-furnace steel producing concerns; the Krupp Con-
cern, internationally best known and erroneously asso-
ciated in the lay mind with cannon manufacture only;
the Cute Hoffnungshiitte Aktienverein fiir Bergbau und
Hiittenbetrieb, with a tie-up, in addition to its far-flung
activities in the Ruhr region, with the Maschinenfabrik
Augsburg-Niirnberg, briefly known as M.A.N., in South-
em Germany; the Roesch Aktiengesellschaft of Dort-
mund; the Klockner-Werke Aktiengesellschaft, like
Krupp~s a family concern; and the Mannesmann-Roh-
renwerke, chiefly devoted to the production of steel tubes.
Besides these six giants there were two other concerns,
with considerable holdings in the Ruhr but their main
interest elsewhere: those of Otto Wolff and Friedrich
Flick.
The combined Ruhr region output of these eight un-
dertakings at the beginning of World War II was sixteen
million tons of steel. To assure themselves of a contin-
uous supply of the high-grade coal and the iron ore
necessary for quality production, each of them acquired
extensive coal and iron mines.
This gigantic industry was in a precarious condition
in the early thirties. One blast furnace after another had
to be blown out for lack of orders. Naturally, the morale
of both workers and employers sank daily. The West-
phalians are a hard-working, plodding, level-headed
people. They are rather set in their ways, thick-headed,
coolly reasoning, hence not an easy prey to political agi-
tators. Now, however, the jobless masses, with much
6
 THE EARLY THIRTIES

time on their hands, began to listen more and more to

44
the clever pleas of communist spellbinders to cast out
the Schlotbarone.'' a
The third powerful industry of the Ruhr was the
chemical. As Professor Norman J. G. Pounds has pointed
out:
The chemical industry derives directly from the by-
product distillation of coal-gas. The resources of the Ruhr
coalfields are greater than those of any other in Western
or Central Europe with the possible exception of the Upper
Silesian [now behind the Iron Curtain].•
The numerous chemical factories, many of them mem-
bers of the IG Farben trust, were also drawn into the
vortex of the Great Depression.
When one remembers that the three principal indus-
tries of the Ruhr were concentrated within an area of
less than two hundred square miles, and that among
them they normally employed 567,000 men, it is not
difficult to see with what political, economic and social
tensions the atmosphere was laden during the period
under discussion. Disturbances instigated by radicals of
the extreme left and right became the order of the day.
The situation in Germany cast its shadows over the
rest of the European continent. For, as John Maynard
Keynes, relentless critic of the Treaty of Versailles, em-
phasized in a course of lectures at Cambridge Univer-
sity as early as 1919, Germany and the other countries
of Europe were inextricably mutually dependent. As he
put it:
3. Literally "Smokestack Barons," meaning, of course, the owners
of the industrial plants whose high chimneys dominate the landscape
of the Ruhr region.
4. Norman J. G. Pounds, The Ruhr (Bloomington, Ind.; Indiana
University Press, 1952), p. 135.
7
 TYCOONS AND TYRANT

Round Germany as a central support the rest of the

European economic system grouped itself, and on the pros-
perity and enterprise of Germany the prosperity of the rest
of the continent mainly depended. The increasing pace of
Germany gave her neighbors an outlet for their products,
in exchange for which the enterprise of the German mer-
chant supplied them with their chief requirements at a low
price. The statistics of the economic interdependence of
Germany and her neighbors are overwhelming.~
Small wonder, then, that letters kept pouring in from
outside Germany from businessmen, inquiring of their
German friends when stable political conditions were
likely to be re-established, so that normal export and
import relations might again prevail. To these anxious
questions German industry had no answer.

Into this situation of confusion, hopelessness and de-

spair burst the raucous voice of a rabble-rouser and
demagogue with a remarkable faculty for being all
things unto all men: Adolf Hitler. His techniques
seemed so uncouth, his logic so faulty, his platitudes
so insufferable, his manners so boorish, his record of
personal achievement so blatantly nonexistent, his ed-
ucational background so spotty, his misrepresentation
of historic facts so preposterous, and the rituals which
he created for his movement so ludicrous, that the ma-
jority of dependable democrats, including the intellec-
tual strata in the trade unions and the Social Democratic
party, failed to take him seriously until it was too late.
By the time they awoke from their blissful dream that
Hitler was more or less a Charlie Chaplin-like comic
figure, he had built up the most powerful political move-
ment in modem history.
5. John Maynard Keynes, The Economic Consequences of the
Peace (New York, Harcourt, Brace & Howe, 1920), p. 16.
8

II'- .
 THE EARLY THIRTIES

Alan Bullock has rendered a unique service to all of

us by portraying Hitler as the demon he really was. 6
I have had many opportunities to speak to Hitler, to
observe him at close range, and to watch him in action.
I find Bullock's analysis of Der Fuhrer the most enlight-
ening and convincing that has yet been published. To
understand Hitler's rise and reign, one must discard pre-
conceived notions and frankly admit that Hitler in his
way was a genius-an evil, amoral genius whose in-
creasing megalomania subsequently led to insanity, but
nevertheless a genius in whom lived a veritable demon
who imbued him with a dynamism plus a depravity
which knew no bounds.
For a man of his type, with his oratorical gifts, coming
into the situation which the German people faced in the
early thirties it was not difficult to capitalize on the short-
comings of the Weimar Republic and the failure on the
part of foreign governments to give this young, strug-
gling republic the necessary encouragement. Masses in
despair are always ready to look for a Messiah, as we
saw in the case of Louisiana and its Huey Long. And
even the intellectuals in a nation are carried off if, in
times of instability and insecurity, someone with intu-
itive knowledge of the proper psychological approach
can present himself as the potential savior. Intellectuals
seem to be easily impressed by a man of overweening,
seemingly inexhaustible energy-the Tatenmensch.
Adolf Hitler conjured up the beatific future of a nation
united, free from political party strife, free from class
war, free from the specter of unemployment, free from
foreign interference, proudly assuming its "proper place"
in the comity of nations.
6. Alan Bullock, Hitler, a Study in Tyranny (London, Odhams
Press Limited, 1952).
9
CHAPTER TWO

Attitudes toward
Adolf Hitler

h e Reichstag election of September 1930 proved an

eye opener for many a somnolent German burgher. The
movement headed by Adolf Hitler, whom most politi-
cians had failed to take seriously, emerged as the second
largest party in the federal parliament. Instead of the
negligible twelve seats-in a gremium of 470-held since
1929, the National Socialists could now occupy 107 seats.
The striking nature of this upset is indicated by the fact
that only two years previously the Social Democrats had
emerged as the strongest political party and for the first
time since the adoption of the Weimar Constitution had
seen one of their number, Hermann Miiller, in the chan-
cellor's seat.
From now on nobody could write the Nazis off as a
noisy minority of crackpots. Their movement, it was
evident, had spread its roots widely into many sections
of Germany. Germans in all walks of life had to clarify
their attitudes toward the strange lance corporal of Aus-
trian birth who parted his hair on the right side, spoke
a Bavarian summer resort dialect, worked himself into
a frenzy of passion as he harangued his audience by the
hour, and made the bombastic salutation, ccHeil Hitler,"
10
 ATTITUDES TOWARD ADOLF HITLER

obligatory for his six and a haH million followers and

later for a nation of sixty-five millions.
The seH-styled Fuhrer, or leader, proved his political
acumen by the very name he gave his party: National
Socialist. A brilliant synthesis of contrasts hitherto re-
garded as mutually exclusive! It caught the ear of men
and women in every social class and of every political
faith.
Hitler offered a spiritual home to all those many
workers of the hand and brain who were dissatisfied
with the internationalism of the two large proletarian
parties of the left. These primitive patriots included
millions of veterans. For them he had a special message:
"I am one of you. I have fought in the trenches as you
have. I am not a brass hat but a combat veteran like
yourselves. I am the Unknown Soldier.''
"Maybe he'll understand our problems better than the
intellectuals and blue-bloods who have thus far ruled
us," many of them commented. "He is a Frontschwein
like the rest of us."
For the disgruntled bourgeoisie he also had a special
message: "All our ills stem from the Treaty of Versailles
which an insidious group of internationalists, mostly
Jews, foisted upon us by their perfidious signatures. I
shall not only rescind Versailles but cleanse our public
life of traitors."
He could always be sure of working his audience up
into unreasoning white-heat emotion by vitriolic attacks
on Versailles. Additional thousands upon thousands who
considered themselves too good to attend his noisy dem-
onstrations secretly vowed they would cast their ballots
for this valiant challenger of a treaty which symbolized
German defeat and continuous humiliation.
With his rare capacity for being all things unto all
11
 TYCOONS AND TYRANT

men, Hitler even knew how to lure into his camp the
many thousands of Germans who retained their loyalty
to monarchism and had never been reconciled to the
Weimar Republic. He promised, as I know, both the
German Crown Prince Wilhelm and the Bavarian Crown
Prince Rupprecht that he would restore the monarchy
if placed in a position of power. Both were beguiled
by his asseverations, only to learn later, like so many
others, that they had been cheated. Meanwhile, how-
ever, word seeped through monarchist circles that the
energetic, powerful young leader of the Nazi Party
would accomplish what the superannuated field-marshal
president had so disappointingly failed to do.
7
Hitler s inroads even upon the masses which had thus
far chiefly supported the Social Democratic and Catholic
Centrist Parties and their respective trade unions, the
Allgemeine Deutsche Gewerkschafts-Bund (General
Federation of Trade Unions) and the Christliche Ge-
werkschaften ( Christian Trade Unions), were amazing
and threw consternation into the ranks of their leaders.
Friedrich Stampfer, Social Democratic member of the
Reichstag and editor-in-chief of the Vorwiirts, late in the
autumn of 1932 visited the Soviet Russian ambassador,
Leo Chinchuk. He appealed to him to talk sense into
the heads of the German Communists and to persuade
them to join in the fight against Hitler. Chinchuk prom-
ised to think the matter over, meaning he would consult
Moscow. Some days later his press liaison officer, B.
Vinogradov, brought the reply: "Sorry, but Nazism must
first come into power before Communism can triumph."
The executive committee of the Social Democratic
Party addressed a confidential inquiry to the General
Federation of Trade Unions, asking whether, to forestall
a coup by Hitler, they would declare a general strike
12
 ATTITUDES TOWARD ADOLF HITLER

as they had so successfully done to checkmate the Kapp

Putsch in 1921. The answer was: a careful analysis of
the membership showed that about one-third had in the
course of the Great Depression swung politically into
the Communist camp; another third was already march-
ing behind the Nazi swastika; only one-third remained
true to the Social Democratic colors. A general strike
was out of question. For, to be successful it demanded
the solidarity of all members. If it failed, the last bul-
wark against labor radicalism-the middle-of-the-road
socialists, who still held the key positions in the trade
union hierarchy-would be swept aside.
.J
After this rebuff by the central organization, the Social
Democrats inquired of the trade union leaders in Saxony,
regarded as the most radical of all the federated German
states, whether they at least would call a general strike.
They, too, replied in the negative. With almost seven
million unemployed in Germany, they pleaded, it would
be easy to hire strike breakers, so that expectations built
around labor's most powerful weapon would be rendered
illusory.
Both groups to whom the Social Democrats addressed
themselves made the further point that their followers
possessed no arms, whereas the Nazis in their street
brawls, their notorious Potempa murder,1 and in various
beer hall clashes had proven that they were somehow
in possession of combat instruments of all sorts. The
trade unions considered it suicidal to fight with weapons
so palpably unequal.
For many Social Democratic leaders, tired and spent
1. On August 9, 1932, five Nazis in cold blood murdered a Com-
munist named Pietrzuch at Potempa, a village in Silesia. The murder
in itself was nothing unusual in those days; it came to be a cause
celebre, however, when Hitler telegraphed the murderers, assuring
them of his solidarity.
13
 TYCOONS AND TYRANT

as they already were from long years of struggle against

enemies of the Weimar Republic on the right and left,
the negative attitude of organized labor was the last
straw. Broken in spirit, they now began to adjust their
thoughts to the facts as they saw them. As convinced
democrats, they argued, we must not oppose the will of
the people. If Nazism is what they want, let Hitler have
a try. The rules of the democratic game demand that
the strongest party furnish the chancellor. If Hitler's
party should come out on top, we as good democrats
must bow to the inevitable. This sort of rationalization
made it easy for Joseph Gobbels later to boast taunt-
ingly, "We made use of the instrumentalities of democ-
racy to run democracy out of business."
By way of further assuaging their consciences, many
Social Democrats deluded themselves with soporifics like
the following: uln a few months the Nazis will have
shown that they can't govern," or "Just let Hitler try-
he'll soon end disastrously," or"Auch die Nazis konnen
nur mit Wasser kochen'' ("The Nazis, too, can cook only
with water"), meaning that despite all their big talk they
would have to bow to common sense.
Looking back upon this period with the eyes of a loyal
Social Democrat who fought Nazism to the bitter end
and was one of the first to be put into a concentration
camp, Paul Lobe, former Reichstag president, or speaker,
sadly and somewhat ironically admitted in his memoirs:
During those weeks the political parties, including the
Social Democratic, and the trade unions can hardly be said
to have given overwhelming proof of circumspection and
valor. The question as to whether the sneaking into power
of the Nazis might be averted by forceful resistance was
a highly controversial one. The majority of our adherents
expected active resistance, but the leaders were convinced
14
 ATTITUDES TOWARD ADOLF HITLER

of the uselessness of a definitely expectable blood bath.

The resulting inactivity was shared by all parties. 2
In a personal chat with me Paul Lobe recalled, as
a characteristic sign of the times, how Otto Wels, chair-
man of the German Social Democratic Party, wistfully
expressed his hope that the rightist Stahlhelm would suc-
cessfully resist Hitler's seizure of power, while Siegfried
von Kardorff, a rightist vice-president of the Reichstag
at the same time, said he hoped the leftist Reichsbanner
would deliver a knock-out blow to the Nazis! a
Adam Stegerwald, minister of labor in the Bruning
cabinet and former Prussian premier, had long been
the universally respected president of the Christliche
Gewerkschaften. His organization of mostly Catholic
laborers, like the socialist-dominated General Federa-
tion, was daily losing members as the Nazi movement
swept everything before it. He decided upon a course of
action quite different from that of the socialists. He be-
lieved in pouring water into the Nazi wine by the in-
filtration of non-Nazis into the Hitler movement. He
therefore went so far as to suggest that the Christian
Trade Unions join the Nazis en 11UlSse.
What happened next was amusingly told by Jakob
Reichert, executive director of the W irtschaftsgruppe
Eisen (Economic Group representing the Iron Indus-
try), in the course of his testimony under oath in the
Flick trial in Niirnberg: •
2. Paul Lobe, Erinnerungen eines Reichstagspriisidenten (Berlin-
Grunewald; Arani Verlags-G.m.b.H., 1949), p. 147.
3. The Stahlhelm, or Steel Hehnet, was a conservative veteran's
organization comparable to the American Legion; the Reichsbanner
a uniformed formation of defenders of the Weimar Republic and its
black-red-gold flag.
4. Military Tribunal No. IV, Case V, Minutes of the Session of
August 28, 1947, 9:30 to 12:30 hours. Cross Examination of Witness
Jakob Reichert by Attorney Otto Kranzbiihler.
15
 TYCOONS AND TYRANT

When the archbishop of Breslau, then the ranking

Catholic cardinal in Germany, learned of Stegerwald,s
intentions, he summoned him. The labor leader, obey-
ing the call, found himseH face to face not only with
the cardinal but with a number of other clerical dig-
nitaries. Stegerwald tried hard to convince these men
of the cloth that the thing to do was to join the Hitler
camp.
The clerics remained unconvinced. Stegerwald now
played his last card. "This opportunity comes to us only
once," he warned. "If we fail to connect now [wenn wir
den Anschluss versiiumen], we shall have missed a
unique opportunity.',
To this the venerable cardinal, according to Reichert,
riposted drily: "Adam Stegerwald, we would then find
ourselves in good company. Jesus Christ, too, was taken
upon a high mountain by the devil and shown all the
kingdoms of the world and the glory of them. He, too,
failed to connect.,,
That brought Stegerwald to his senses. He became a
staunch opponent of Hitler. American Military Govern-
ment in 1945 appointed him Regierungspriisident for
the Wiirzburg area until his death in December 1945.
While by no means all Centrist Party leaders were
ready to go as far as Stegerwald, there was a widespread
feeling among them that Hitler should be given govern-
mental responsibility which, it was hoped, would have
a sobering effect upon him. Chancellor Bruning with the
approval of his Centrist colleagues therefore repeatedly
sounded the Nazi Fuhrer out on the possibility of his
entering a coalition cabinet. Bruning,s efforts failed.

Another major political group which eyed the rise of

Nazism with apprehension was the German National
People's Party ( Deutsch-NatioMle Volkspartei). Under
16
 ATTITUDES TOWARD ADOLF HITLER

Alfred Hugenberg's disastrous leadership this conserva-

tive organization was falling to pieces. One faction had
already split off, adding to the plethora of political
groups still another, the German Conservative Party
( Deutsch-Konservative Partei), with Gottfried Trevi-
ranus at its head. The Nazi steamroller threatened to
wipe out the rest.
Hugenberg had been chairman of the board of direc-
tors of the Krupp Concern from 1909 to 1918 but had
violated a hallowed Krupp tradition of keeping out of
politics by beginning in 1917 to buy up all sorts of news-
papers and news services. He was eased out, acquired
the impecunious Lokal-Anzeiger of Berlin, and thus be-
gan a career in the German capital which soon made
him a powerful publisher, owner of Germany's greatest
motion picture concern, the UFA, and chairman of the
German National Party. He was the prototype of the po-
litically retarded German businessman. Stocky, bristle-
haired, he was always a somewhat incongruous figure
with his bobbing cutaway coat-tails and his upward-
turned moustache of a former imperial drill-sergeant.
Hugenberg felt confident he could harness Hitler to
his own chariot. Like so many unpolitical Germans of
means he believed everything could be done with
money. He recognized that Der Fuhrer had one element
indispensable to political success: Hitler could deliver
the masses while he himself exuded no human appeal
whatsoever. On the other hand, Hugenberg had nothing
but contempt for the rabble in Hitler's entourage which
in his opinion could never administer a state. "Let Hitler
supply the masses," he privately assured his followers.
''We'll supply the brains.''
To doubting Thomases among Hugenberg's conserv-
atives the reassuring appraisal went down the line, "The
17
 TYCOONS AND TYRANT

Nazis are like young, unfermented wine; after fermen-

tation they'll settle down all right."
To forestall a possible Centrist-Nazi coalition, Hugen-
berg arranged for a joint meeting of nationalists of all
shades at Harzburg, a watering place in the Harz Moun-
tains, on October 11, 1931, to which he invited Hitler
and his uniformed marching columns. To all of us who
attended the Harzburg rally as observers it was obvious
that Hugenberg had miscalculated; Hitler was quite
willing to use Hugenberg, but he would not be used by
the boss of the German National Party. A week later
Der Fuhrer put on a show of his own at Brunswick which
clearly indicated where the real strength in the nation-
alist camp lay.

German industrial leaders were much slower in ac-

quainting themselves with Adolf Hitler and his move-
ment than were the middle-and-working-class masses.
There were a few exceptions : in Bavaria, the owner of
an electro-chemical plant, Albert Pietsch, staked Hitler
with a thousand marks (about $250) from time to time
as early as 1923. Carl Bechstein, piano manufacturer,
and Kommerzienrat Hugo Brockmann of Munich, pub-
lisher of Houston Stewart Chamberlain's works, also
helped the Nazis financially. But they were "small fry''
in the industrial world. In the Ruhr, the most wealthy
shareholder in the United Steel Works, Fritz Thyssen,
embraced the Nazi faith in the early thirties and per-
suaded another Ruhr tycoon, the aged Emil Kirdorf,
to ally himself with the master of the Brown Shirts.
Generally speaking, however, the industrialists did
not take an interest in Hitler until after the Reichstag
elections of 1930 had visibly demonstrated that this tem-
pestuous person deserved more careful attention.
The industrialists had been traditionally disinterested
18
 ATTITUDES TOWARD ADOLF HITLER

in politics. To brief them on political situations and

trends, they relied, if at all, on their special reporters,
or Referenten, on the whole a poorly paid species who
were mere appendices to their concerns. Why bother
personally? It was more important to the tycoons to
manage their profitable enterprises than to hear or read
about the endless talk in the Reichstag, which struck
them as a badly organized business. Politics to them
was a more or less necessary evil. Many, probably most
of them, belonged nominally to one of the many polit-
ical parties. But they took an active hand in politics only
for limited purposes. By and large they were congen-
itally indifferent to politics.
Least of all did they bother to study Mein Kampf-
a mistake which they shared with millions of other Ger-
mans as well as foreigners. 5
When the tycoons finally became alerted, they began
to look for Hitler's economic program. This was, at best,
unclear. Hitler was never concerned about economics.
Though uncannily clever at making money and Iavish
in spending it, he never bothered to learn the how, why
and wherefore of economic processes. If sound economic
objections were advanced against this or that pet project
of his, he replied to his experts, as he did to all other
doubters of the practicality of his measures, ccEs muss,
weil es muss'' C'It must [be done] because it must").
He was careful not to commit himself personally to any
definite economic creed. He preferred to discuss finance
and business and production in non-binding generalities.
But an economic screwball, Gottfried Feder, had
gained his ear to the extent that Hitler placed him in
charge of the economics section of the Nazi Party. Feder
5. Neville Chamberlain boasted that he had never read one line
of M ein Kampf, although an English translation was available.
19
 TYCOONS AND TYRANT

clung to the medieval precept that it is immoral to charge

interest. The tycoons were alarmed, lest he be hoisted
into a position to put his theories into effect.

Two Nazis, one of them close to the top in the hier-

archy, the other a successful journalist, seemed to have
sensible ideas: Gregor Strasser, chief Nazi Party organ-
izer, was a moderate labor leader with an excellent grasp
of business and industry. He had been one of Hitler's
earliest followers and was usually to be found on the
side of sanity and moderation. To the industrialists it
seemed reasonable to give him an occasional lift and
thereby strengthen his position vis-a-vis the Hwild menn
in Hitler's entourage.
Walther Funk was the chief editor of the conservative
Borsenzeitung of Berlin, a daily newspaper devoted to
finance, business and industry. He had joined the Hitler
ranks secretly, continued in his job as many other Nazis
did, and on the side published an economic news service.
While embracing most of the tenets of Nazism, he still
remained more or less of a "regular'' in economics. His
news service, therefore, seemed to deserve the support
of the business world as a counterweight to the rad-
icalism of Gottfried Feder.6
Both Strasser and Funk received modest subsidies
from industrialists-not big money, but enough to enable
them to make their ideas known to their fellow Nazis
in the hope of influencing them in the direction of eco-
nomic moderation.

Up in Berlin there was a man whom every captain of

industry knew and who considered himself as versatile
in politics as he was in economics: the "financial wizard"
6. Funk was condemned as a war criminal at Niirnberg and
sentenced for life.
20
 ATTITUDES TOWARD ADOLF HITLER

Hjalmar Schacht. "He must know what it's all about,''

said many a leading industrialist. "He has contacts every-
where; what does he think about Hitler?'" they asked
each other.
Schacht, a founder of the German Democratic Party
and a potential candidate for the Reich presidency, had
resigned as president of the Reichsbank in 1930, had
attended the Harzburg conclave of the "national oppo-
sition,'" and now was a frequent caller at the Hotel Kai-
serhof in Berlin, Hitler's headquarters within a stone's
throw of the Reich Chancellery. This crafty, wily ex-
president of Germany"s central bank of issue picked
Hitler as a winner and hitched his wagon to the fast-
moving Nazi comet on the German political firmament.
Schacht had written Hitler as early as August 29,
1932, in part as follows:
My letter is to serve no other purpose save that of assur-
ing you of my unchanging sympathy in a time of serious
retardation. I know that you are not in need of comforting
words ... . What you may appreciate during these days,
however, is a word of most sincere fellow-feeling. Your
movement is borne onward by such convincing truthfulness
and necessity that victory in one form or another simply
cannot fail to come. . . .
Wherever my work may lead me in the near future-you
may count upon me as your dependable assistant. 7
On November 12, 1932, he had written to the Nazi
leader:
Permit me to extend my special congratulations to you
for the firm attitude which you took immediately after the
election. There is no doubt in my mind but that develop-
ments can end in but one thing-your chancellorship. . . .
7. H. R. Bemdorff, General zwischen Ost und West (Hamburg:
Hoffmann und Campe Verlag, 1952), p. 218.
21
 TYCOONS AND TYRANT

I am filled with confidence because the entire present

system is bound to run into a dead end.
In his memoirs 8 Schacht apparently found no space
for any reference to these letters.
The strongest trait in Schacht's character, it seemed
to those of us who knew him well, was his ambition.
He hoped to become the savior of Gennany after the
failure of the Nazi experiment. There is good reason,
therefore, to believe that his devotion to Hitler was not
as naive as appears on the surface. The two letters cited
should perhaps be read in the light of his ambitions.
All the world knows by this time that Schacht, like
Thyssen, later rued the day on which he turned his back
on his own past and lent his talents and his high intel-
ligence to the antidemocratic, antirepublican movement
of an ambitious autocrat like himself. He fought the
Nazi hierarchy as Hitler's Reichsbank president and
minister of economy, opposed financial measures which
he deemed deleterious to Gennan economy, and subse-
quently joined the group which worked for the over-
throw of Hitler and his satellites. The end of the Nazi
regime found him in a concentration camp. The Ni.im-
berg judges acquitted him.
But the fact is undeniable that Schacht's attitude at
this time had a tremendous repercussion in a confused,
groping business world. His espousal of the Hitler cause
won his new master many a disciple.
Some cautious industrial leaders, to be on the safe
side, continued their membership in the Gennan Peo-
ple's or the Gennan National Parties but at the same
time quietly acquired identification cards attesting that
they were members of the National Socialist movement.
8. Hjalmar Schacht, Account Settled, translated by Edward Fitz-
gerald (London; C. Weidenfeld & Nicolson, 1949) .
22
 ATTITUDES TOWARD ADOLF HIT L ER

Some contented themselves with delegating one mem-

ber of their directorate to join up with the Nazis and
thus both to act as a listening post and as evidence,
should Hitler come to power, that "they had always been
for him." But these were the exceptions.

On November 6, 1932, during the brief chancellorship

of Franz von Papen, the German people once again went
to the polls as a result of another one of the many dis-
solutions of the Reichstag which characterized this tur-
bulent period. For the first time since Hitler's phenom-
enal success at the polls in September 1930, his party
lost heavily. Nazi seats in the Reichstag were reduced
from their all-time high of 230 out of 608 in the July
1932 election to 196 out of 584, a percentage drop from
37.3 to 33.1.
Soon after the election, Wilhelm Karl Keppler, one of
Hitler's principal economic advisers at the time, hoped
to bolster the Nazis' declining fortunes by drafting a
letter which urged Hitler's appointment as chancellor.
He proposed that it be addressed to President von Hin-
denburg and signed by leading tycoons. This brain wave
had consequences not envisaged by him: it played an
important part in the chief Niirnberg war crimes trial 9
and cropped up again during the 1953 Bundestag elec-
tion. In both instances it was exploited as alleged proof
that German industry was determined to foist Hitler
upon an unwilling Hindenburg.
The letter proposed by Keppler read as follows:
Your Excellency, most highly respected Herr Reichspriisi-
dent:
The undersigned, like Your Excellency imbued with a
passionate love for the German people and the Fatherland,
9. Proceedings, Vol. XXXIII, pp. 531-533.
23
 TYCOONS AND TYRANT

-have welcomed with great hopes the fundamental change

in the conduct of government for which Your Excellency
has cleared the way. Together with Your Excellency we
affirm the necessity for a government independent of par-
liamentary partisanship, such as finds expression in the idea
of a presidential (priisidial) cabinet as formulated by Your
Excellency.10
The result of the Reichstag election of November 6 has
demonstrated that the present cabinet, whose honest inten-
tions are doubted by no one among our German people,
has not found sufficient support for the course it proposed
to pursue, whereas on the other hand the goal to which
Your Excellency has pointed is supported by a majority of
_ the German people, if one excepts, as must be done, the
state-negating Communist Party. Not only the German Na-
tional People's Party and a number of smaller groups closely
allied to it, but also the National Socialist German Workers'
Party is in principle opposed to the parliamentary party
regime which has prevailed hitherto and has thereby af-
firmed the goal envisaged by Your Excellency.
We regard this result as extremely gratifying and consider
it unthinkable that the realization of your aims should now
fail because a method which has been found ineffective is
permitted to continue.
It is obvious that an oft-repeated dissolution of the Reichs-
tag, with the increasing tensions entailed in new elections
preceded by ever more acrimonious party strife, must nec-
essarily throw obstacles in the way of not only political but
also of all economic equilibrium and stability. It is equally
clear, however, that any change in the constitution that is
10. Hindenburg's idea of a Priisidialkabinett was somewhat anal-
ogous to the American system, whereby the members of the cabinet
are responsible, after their confirmation by the Congress, to the pres-
ident and not to the legislative branch. In most European parliaments
a member of a cabinet can be disavowed personally by a non-con-
fidence vote, whereupon he automatically resigns. In the old German
Reichstag of the Weimar Republic the members of a coalition cabinet
usually took their orders from their respective parties.
24
 ATTITUDES TOWARD ADOLF HITLER

not supported by widest currents of the people will have

even worse economic, political and spiritual effects.
We therefore feel ourselves in conscience bound most
respectfully to implore Your Excellency to reorganize the
Reichs cabinet in such a manner for achieving the end which
we all affirm that the greatest possible popular support may
be vouchsafed to the cabinet.
We believe ourselves to be free from any narrow, partisan-
political attitude. In the national regeneration which is now
taking hold of our nation we see the hopeful dawn of a
period which will rear the indispensable foundations for a
resurgence of German economy by the elimination of class
differences. We are aware that this resurgence will demand
many more sacrifices. We believe that these sacrifices will
be made willingly only if the largest element in this national
movement is made to share in the government in a leading
position.
By entrusting the headship of a presidia! cabinet made
up of the best possible talents and personalities to the leader
of the largest national group, the dross and shortcomings
that necessarily cling to every mass movement will be elim-
inated and millions of men and women who are today stand-
ing off on one side will be swept along into positive par-
ticipation.
In full trust in Your Excellency's wisdom and Your Excel-
lency's espousal of Volksverbundenheit, 11 we send our most
reverential greetings.
An American investigator testified at Niimberg that
a copy of this document had been found in the ruins
of the Cologne banking house of I. H. Stein in which
Baron Kurt von Schroder was a partner. Two scraps of
paper, he reported, were attached to it, each containing
a pencilled list of names, one of forty, the other of thirty-
11. There appears to be no English equivalent for this word, which
denotes a consciousness of belonging to or being a part of the same
people, and of all sharing good and evil with each other.
25
 TYCOONS AND TYRANT

four business tycoons, many being identical on both lists.

Some of the names had crosses before or after them,
some were followed by an initial, several bore a question
mark.
It is definitely known that Hjalmar Schacht signed
the draft. Carl Friedrich von Siemens and Paul Silver-
berg, whose names appeared on both lists, refused to
have anything to do with it and opposed the whole
project. Yet their names were publicized as alleged
signers. A thorough search of the Krupp archives has
failed to produce any evidence that Gustav Krupp von
Bohlen received the letter or that he signed it. Men like
August Thyssen, August Rosterg, Friedrich Reinhardt,
and Kurt von Schroder/ 2 whose names also are included
on both lists, may well have signed. The appearance of
most of the other names on the lists is difficult to explain.
Was the letter ever sent to President von Hindenburg?
No proof has been furnished that it was. If it was ac-
tually sent, who were the signatories? Schacht has re-
cently stated in answer to a direct question that only a
few tycoons were willing to endorse the document. It
is more than unlikely that Paul Reusch, Albert Vogler,
and Robert and Carl Bosch lent their names to the
Keppler venture.
But supposing the letter was dispatched. Why did not
the versatile Joseph Gobbels see fit to use that fact in
his propaganda? He would not have hesitated to claim
that all industrialists were behind Hitler, even though
only three or four signatures were affixed. But he could
not have dared publicize a letter that was never sent.
Thus the Keppler-drafted letter loses its value as al-
leged proof of the attitude of German industry.
12. Cf. Index for references to the personalities and careers of the
tycoons mentioned in this and the following paragraph.
26
 ATTITUDES TOWARD ADOLF HITLER

The question remains, however, how could it happen

that Keppler took this bold initiative? He must have had
good reasons. These can readily be found in the fact that
business and industrial leaders were convinced that Ger-
many was facing imminent disaster which could not be
averted by traditional expedients, as it was unparalleled
in scope.
It is difficult now, some twenty years later, to recap-
ture the spirit of gloom and panic which then prevailed.
I have asked all available "old-timers, in the German
industrial world about their feelings and attitudes late
in 1932. All insist that no thought was further from their
minds than that of making Hitler dictator; they were not
even sure that the Nazi Fuhrer would measure up to the
requirements of the hour. But at least he was an implac-
able foe of communism. Moreover, nobody else in Ger-
many seemed to have authority commensurate with his.
These men felt confident that Hitler's boisterous min-
ions would settle down and behave, once their leader
was entrusted with the chancellorship. For, the Social
Democrats, too, who in the Kaiser's day had been re-
garded as the "wild men" of the time, had become rea-
sonable and statesmanlike once they were saddled with
responsibility in the Weimar Republic. What the tycoons
wanted was stable political conditions. Something had
to be done-and Hitler promised to do it. Anything for
a change-and Hitler promised that change. They feared
communism-and Hitler promised to eradicate it.
The cry for a change in Germany was not very dif-
ferent from the cry for a change in the United States
which in 1932 brought to the fore a Franklin D. Roose-
velt and in 1952 a Dwight D. Eisenhower.

President von Hindenburg at the time of the Keppler

letter was not yet sufficiently softened up to hand over
27
 TYCOONS AND TYRANT

the reins of government to that "Bohemian corporal who

at best might be a postmaster-general," as he once ex-
pressed himself. Hence, when Papen failed, he appointed
General Kurt von Schleicher chancellor. Only after this
military politician had also suffered shipwreck did the
"court camarilla'' surrounding the senile octogenarian,
whose ranks had never ceased to include the crafty
Papen, persuade him to tum to the Nazis.
Did industry "put Hitler in the saddle"? Hitler had
been in the saddle for quite some time before the in-
dustrialists ever got around to him, and was riding high
when they began to occupy themselves with him. His
movement before 1933 was essentially one of the "little"
people, not of the top strata of society. Hitler would
inevitably have attained his goal without the industrial-
ists. Their actual financial help will be examined in
Chapter Five.

28
CHAPTER THREE

Dominant Figures
in German Industry

Publicists have an understandable passion for simplify-

ing events and personalities. They typify them even more
drastically when dealing with contemporary history and
living individuals.
Thus German industrialists become a monolithic group
which is ruthless, bellicose, given to intrigue, uncul-
tured, devoid of idealism, and devoted solely to business
and the amassing of fortunes, at which they are masters.
It is important, before we proceed further, to test the
verity of this cliche by prying somewhat into the lives
of a representative number of the men who were top
leaders in German industry during the period under dis-
cussion. Upon them rested the chief responsibility for
the industrial sector of German life; as they acted, so
were thousands of their lesser colleagues also likely to
act.
What sort of men were they? What backgrounds did
they have? What "made them tick"? What was their
concept of authority, of leadership, of responsibility for
the common good? What was their sense of duty toward
the community? What interests besides commercial did
they have?
29
 TYCOONS AND TYRANT

The sketches which follow contain many an answer

to these questions. My selection of eleven representative
(~erman tycoons was dependent on finding authentic
sources. It is therefore by no means exhaustive.
Gustav Krupp von Bohlen und Halbach
Almost automatically, the first name that comes to
mind is that of Krupp von Bohlen und Halbach ( 1870-
1950). There are good reasons for this. He was the hus-
band of Bertha Krupp. Her great-grandfather, grand-
father, and father had in the course of three generations
built up one of the most powerful industrial empires in
Europe. The senior of each generation of Krupps became
known as The Cannon King ( Der Kanonenkonig).
Krupp steel, not only for guns but for other purposes,
was of exemplary quality, and the three-ring trade mark
of the firm was a guarantee of excellence.
In the belief that the standard of Krupp products
could best be maintained by the continued concentra-
tion of industrial power and responsibility in one hand,
Alfred Krupp, the second-generation head, left a will in
1887 according to which the Krupp Concern was to
remain indivisible and the oldest descendant the sole
owner (with the moral obligation of looking after the
rest of the family) . The provisions of this will were re-
affirmed by Adolf Hitler in 1943 in the so-called Lex
Krupp.
Bertha Krupp, daughter of third-generation Friedrich-
Alfred, in 1902 became the sole owner, the only other
issue being a younger sister. This meant that the name
of Krupp was likely to die out with the fourth-genera-
tion proprietress. But Kaiser Wilhelm II came to the
rescue: a young nobleman named Gustav von Bohlen
und Halbach, who proved acceptable as suitor, was per-
mitted to precede his family name by his wife's. Gustav
30
 FIGURES IN GERMAN INDUSTRY

von Bohlen, incidentally, was a great grandson of Brig-

adier General William Henry Charles Bohlen, who fell
in battle at the Rappahannock in 1862 while fighting on
the side of the Union in our Civil War. The young bride-
groom in 1906 became Gustav Krupp von Bohlen und
Halbach, and his oldest son is today legally called Alfried
Krupp von Bohlen und Halbach.
Gustav Krupp von Bohlen was a strange figure in the
German industrial world. Trained for a diplomatic ca-
reer, without any experience in business, he was sud-
denly placed at the head of a gigantic concern in a
highly competitive industry. His opposite numbers in
the industrial world round about him were either men
whose fathers or who themselves had created their mini-
ature empires, or men of science whose inventive genius
was put to industrial use, or at least men who had grown
up in the atmosphere, practices, and conventions of the
commercial world.
Bohlen was not an entrepreneur; he was an adminis-
trator of his wife's fortune. He had to learn how to man-
age the Krupp Concern the hard way, by familiarizing
himself with processes strange to him, and by regulating
his life so austerely and so much in time-clock fashion
that he impressed some people as an automaton rather
than as a being with flesh and blood and human reactions
and affections.
The fact that he considered himself merely as the
trustee of his wife~s fortune and not as an entrepreneur
( U nternehmer) in his own right led him to be extremely
cautious. He shied away from anything that might in
the end damage the Krupp interests. His awareness that
he did not stem from industry seems to have made him
inwardly rather diffident, with somewhat of an inferior-
ity complex which, however, he managed by great will
power to hide successfully.
31
 TYCOONS AND TYRANT

A product of the rigid German civil service, he had

an amazing, almost incomprehensible respect for author-
ity and duty. He was as loyal to the blue-blooded Kaiser
Wilhelm II as he was to the socialist Friedrich Ebert,
as obedient to the conservative-monarchist Field Mar-
shal Paul von Hindenburg as he was to the National
Socialist Adolf Hitler. When, in the early days of the
Weimar Republic, someone during a reception at his
home made disparaging remarks about "that saddle-
maker Ebert," the otherwise self-possessed host flared
up and declared he would not stand for an insult to the
chief of state. When, years later, Carl Bosch of IG Far-
ben in a private gathering charged the Nazi regime with
corruption, Bohlen left the gathering, protesting that he
objected to this affront to the Fuhrer of Germany.
It was not alone his training in the imperial civil serv-
ice that partly explains his egregious respect for author-
ity: Krupp von Bohlen tried literally to live up to the
Biblical injunction, "Let every soul be subject unto the
higher powers." The thought of questioning any order
by constituted authority seems never to have occurred
to him. His failure to discern that commands issued by
human ukase in contravention of God's Ten Command-
ments are null and void led him into tragic errors. Only
when one is aware of the authority complex in Krupp
von Bohlen can one understand how his only comment,
when Fritz Thyssen offered his condolences for the sol-
dier>s death of one of the Essen magnate>s sons, was,
''My son has had the honor to die for the Fuhrer.''
This entrepreneur-by-accident was not without per-
sonal courage. In January 1923 the French had occupied
the Ruhr. On March 31 there was a clash on the Essen
premises of the Krupp Concern between some workers
and the French occupation army. A French lieutenant
with eleven poilus started to occupy the plant in which
32
 FIGURES IN GERMAN INDUSTRY

trucks were manufactured, and to seize some motor cars

about to start on a routine trip to distribute the weekly
pay envelopes. A melee resulted, in the course of which
thirteen Krupp apprentices were killed and a score
wounded. The head of the concern attended the funeral
services and twice testified on behaH of his workers dur-
ing hearings conducted by the French.
Krupp von Bohlen happened to be in Berlin attending
a meeting of the Prussian State Council toward the end
of April, when he received a third summons from the
French occupation authorities. He decided to return to
Essen immediately. Various members of the council
urged him not to go, as he was certain to be arrested.
4
' It is my duty to stand by my men," Krupp insisted.

In Essen he was seized on May 1, immediately after

reporting to the French, and charged with having in-
stigated the urebellion." The French condemned him to
fifteen years imprisonment in Dusseldorf. He had to
serve only a few months, because the German Govern-
ment had meanwhile given up passive resistance. On
his return to his concern the workers received him like
a conquering hero.
Bohlen's unquestioning obedience to authority was
matched by his passionate devotion to duty. His first
and foremost duty as he conceived it was to his country.
Fervently nationalistic and patriotic, he thoroughly be-
lieved in the creed, "My country right or wrong."
Ranking immediately behind his duty to his father-
land was his duty to the Krupp family, the Krupp tra-
dition, the Krupp Belegschaft (workers and employees),
the famed Krupp social projects, such as housing, hos-
pital care, pensions, workers' insurance.
Third in line of duty were the numerous honorary
positions to which he was elected. Chief of these was
33
 TYCOONS AND TYRANT

the presidency of the Federation of German Industries

( Reichsverband der deutschen I ndustrie) , which he
headed from 1931 to 1934.
His 139,259 workers respected him highly. To be a
Kruppianer almost made one a member of a cult. Gustav
von Bohlen, who seldom showed emotion, broke into
tears when his wife, Bertha, visited him for the first time
in the Dusseldorf jail, not in self-pity, but touched at
the thought that "Well, Bertchen, now I have really and
truly become a Kruppianer.~'
The relationship to his workers, however, was not a
relaxed, informal, chummy one, but rather that of de-
voted subjects to their fatherly ruler. True, he listened
patiently to the views and complaints of those who
worked for him, but there was usually an air of formality
about him. It was simply unthinkable that anybody
should slap him familiarly on the shoulder and say,
"Hello Gus, old chap!" He was almost always The
Presence.
In his business relations he was scrupulous to the nth
degree about contracts. His associates remember in-
stance after instance when he disregarded legal advice
to annul a contract which proved unfavorable to the
firm. "A contract is sacred to me," he was wont to ob-
serve. The Treaty of Versailles, too, was a binding con-
tract as far as the fourth-generation Kanonenkonig was
concerned. 1
His colleagues esteemed him for his fairness and his
ability at adjusting differences. Most of them were ro-
bust, strong-willed, unyielding and uncompromising in-
dividualists; they felt relieved to have a man at the head
of their national federation who always remained a gen-
tleman, never lost his temper, weighed every proposal
1. Cf. Chapter Ten, p. 205.
34
 FIGURES IN GERMAN INDUSTRY

carefully, and was always ready to work out a compro-

mise. He was not at all the belligerent type.
His colleagues, too, lived somewhat in awe of him.
He was the uncrowned monarch of the Ruhr. An invi-
tation to the Krupps in the colossal architectural struc-
ture of two hundred rooms, Villa Hugel outside Essen,
was like a royal command.
Once during my tenure as correspondent for The
Associated Press in Germany I was invited to the Villa
Hugel for lunch. Our car arrived at the front entrance
at exactly 13:29 hours. One minute later we journalists
were invited into the huge reception room, where our
host and hostess devoted ten minutes to becoming ac-
quainted with their guests.
Exactly at 13:40 the high doors of the dining room
were flung open and we were ushered in. A simple lunch
with a minimum of conversation followed. Time al-
lowed: 30 minutes.
At 14:15 we found ourselves in a lounge sipping coffee
and a liqueur. Time allowed: 15 minutes. Good-by,
thank you, and Auf Wiedersehen. Departure at exactly
14:30. It was all very correct.
Industrialists who have been evening guests at Villa
Hugel tell me that a servant quietly approached the in-
vitees at 22 hours to inform them, "Your car is at the
entrance.'' Overnight guests have reported that they had
to request that their breakfasts be brought to their bed-
rooms or else join the family promptly at 7: 15. If they
came later, they found the dining room doors closed.
Bohlen was no more exacting upon his guests than he
was upon his family and himself. He never smoked. He
was almost a teetotaler, who took a few sips of wine
merely as a courtesy to his guests or hosts. His life was
regulated to the minute. His only relaxation was a brief
35
 TYCOONS AND TYRANT

canter on horseback and an occasional rest on his estate

in Austria.
His children were brought up in reverence rather than
affection for their progenitor. Many an older industrialist
has assured me that the oldest son, Alfried, was a
changed man when not under paternal observation.
"Children must be seen, not heard"-this dictum was still
in force on Villa Hugel with reference to the five sons
and two daughters of Bertha and Gustav.
As the sons grew up and, returning from their studies
at the university, dared evince an interest in political
occurrences, the head of the family interrupted them
with ~'Hier wird nicht politisiert~ C'Politics is taboo
7

here").
Like many monarchs who sense potential rivals in
their oldest sons, this industrial king, too, failed to take
his "crown prince,'' Alfried, into his confidence. When,
therefore, beginning about 1939, progressive arterio-
sclerosis befell Gustav Krupp von Bohlen and it became
necessary in 1943 to place Alfried in charge of the Krupp
interests, the young man was caught rather unprepared,
although he had worked in the concern since 1935.
Bohlen's strange relationship to Hitler, often puzzling
to friend and foe alike, can be understood only, I be-
lieve, when projected against the personal and family
background which I have attempted briefly to sketch.
It appears further that Gustav Krupp von Bohlen was
quite uncommunicative concerning many matters which
he personally decided. Had he sought advice, he could
have avoided mistakes which made him seem like a
"babe in the woods" in political matters. Not that he
thought his judgment unerring: he felt he must shoulder
responsibility for such decisions alone.
As examples of his seeming naivete I would mention
the following, inter alia:
36
 FIGURES IN GERMAN INDUSTRY

Krupp von Bohlen decided to fill a vacancy in the

directorate by appointing Karl Goerdeler, former mayor
of Leipzig and former Reich price stabilizer, to this po-
sition because of his long administrative experience.
Everybody with only an inkling of politics, however, was
aware that Goerdeler was not only an avowed anti-Nazi,
but was the head of an active resistance movement. Yet
Bohlen humbly asked Hitler's permission to appoint him,
and seemed puzzled when Der Fuhrer turned thumbs
down.
He next sought Goerdeler's advice as to whom else
to appoint. The former mayor suggested Ewald Loser,
a man secretly slated by the German resistance for
finance minister in the event of a successful coup d'etat.
Bohlen acted on this advice, blissfully unaware of Loser's
anti-Nazi connections. Loser was arrested by the Ge-
stapo for complicity in the July 20, 1944, plot against
Hitler's life.
As the Gestapo became more and more ubiquitous,
it seemed desirable to delegate a trusted official at
Krupp's to act as a buffer between the management and
Rimmler's secret police. Bohlen's choice fell, of all peo-
ple, upon gentle, conciliatory Fritz von Biilow, a cul-
tured, sensitive man, then in charge of the Krupp Berlin
office. That a man of his temperament was not a match
for Rimmler's bullying minions, should have been ob-
vious. The prosecution pictured Biilow, a man whose
personal integrity was beyond suspicion, to the Niim-
berg court as one of the most heinous of industrial crim-
inals because his signature was affixed to a number of
Krupp directives initiated and peremptorily demanded
by the Gestapo which he did not have the authority to
resist.
These three examples should suffice to illustrate my
point. They should be kept in mind when, further on,
37
 TYCOONS AND TYRANT

we learn of Krupp von Bohlen's role in the Gleichschal-

tung, or transformation to conform to the Nazi pattern,
of the Reichsverband der deutschen I ndustrie, and in
the dissolution of a unique, small organization of top
Ruhr industrialists known as the Ruhrlade; also, when
we note his pained surprise at being demoted to head
only one of seven economic departments set up under
the Nazis in place of the all-embracing Reichsverband
der deutschen I ndustrie of which he had been the de-
voted president.
Carl Duisberg
A second name which comes to mind readily when
leading German industrialists are discussed is that of
Carl Duisberg ( 1861-1945), founder of the chemical
trust known as IG Farben, the full official name of which
is I nteressen-Gemeinschaft Farbenindustrie Aktienge-
sellschaft.
Carl Duisberg, whom the English chemist, Henry E .
Armstrong, in an obituary tribute on the occasion of his
death at the age of eighty-four in 1945 described in the
London Times as "the greatest industrialist which our
contemporary world possessed," was born September 29,
1861, the son of a ribbon manufacturer in Barmen, West-
phalia. His father wanted him to take over his business
as he grew to manhood, but the son from early child-
hood on insisted he wanted to be a chemist. Neither
parent knew just what that meant, but his mother had
faith in her boy and saved all earnings from a truck
garden which she assiduously cultivated to enable him
to go to college and study chemistry.
Young Carl obtained his degree of Doctor of Chemis-
try at Jena University at the age of only twenty and
became scientific assistant at Jena for a year. Through
the intervention of his mother, who had gone to school
38
 FIGURES IN GERMAN INDUSTRY

with Friedrich Bayer, founder of the Bayer Chemical

Works ( Bayer's Aspirin, etc. ) , he was added a year later
to the staff of the Bayer company at Elberfeld.
From now on his rise was rapid. Several discoveries
of his in the chemical field were so successful financially
that the Bayer Concern, then struggling desperately for
its existence, came out of the red into the black and a
larger plant became necessary. Duisberg was assigned
the task of planning and supervising the erection of the
new project.
It was then that Duisberg's rare talents as an organizer
and as a man with a social conscience became evident.
He chose a little fisherman's village, Leverkusen-on-the-
Rhine, as the site. With characteristic thoroughness he
first wrote out a careful treatise on just how the new
plant was to be built. This treatise, written in 1895, is
still a standard work for German entrepreneurs.
Duisberg's central idea was that the human being is
the most precious item about a factory. All workers in
a plant must have a feeling of "belonging," of being
conscious that this is their plant, the scene of their life's
work. Above all, the chemists working there must be
given laboratories that will make work a joy and stim-
ulate them to joint effort. He therefore departed from
the usual system of having each chemist work for him-
self in the seclusion of his little laboratory, and decided
they should work in common ~~blocks" with only their
laboratory tables separating them. He believed that
chemists working for the same concern, but each occu-
pied with his special task, would soon take a lively in-
terest in each other's work if grouped in open rooms.
He foresaw that scientific discussions would result, and
that the chemists would fructify each other, so to speak,
by mutual friendly suggestions.
39
 TYCOONS AND TYRANT

He also believed strongly in beautifying places of

work. He had a special love for sculpture and painting,
as well as for landscape gardening. Hence, Leverkusen
became a model factory as regards outward appearance.
"Applied science can be beautiful,'' he often said.
But he also believed-and saw to their introduction-
in many things of a social nature that seemed almost
revolutionary in his day: attractive workers' homes, care
of expectant mothers, sports places, swimming pools,
and social insurance. Like a number of other far-sighted
German industrialists he built his home amidst the
Leverkusen project, so that the workers and employees
and scientific collaborators might have ready access to
him and realize that he really and truly considered him-
self a part of the undertaking, not merely a distant, un-
approachable boss.
Duisberg became an enthusiastic globetrotter, for he
found that in visiting chemical plants elsewhere he could
pick up many worth-while ideas. This was especially
true of his trips to the United States, from where he
returned brimful of suggestions and ideas for improve-
ment.
Above all, he realized from these journeys that scien-
ti6.c progress in the field of chemistry could best be made
by the constant interchange of information. "The world
is the chemist's field of activity," was another favorite
saying of his.
From this realization sprang his ambitious plan of
uniting as many chemical concerns in Germany as pos-
sible. It was distinctly not a desire for power that
prompted him to build up the big IG Farben trust, but
rather his awareness as a scientist that research could
be advanced so much better if all facilities were pooled,
and his recognition as an administrator and organizer
that there was much duplication of effort, waste of
40
 FIGURES IN GERMAN INDUSTRY

money, especially on the purchasing side of materials,

and unnecessary competition.
His dream became a partial reality before the out-
break of the First World War, when his 1904 expose for
the unification of the chemical industry led to the fusion
of the Badische Anilin- und Soda-Fabrik of Ludwigs-
hafen, the Aktien-Gesellschaft fur Anilinfabrikation
(AGFA) of Berlin, and the Farbenfabrik Bayer and Co.
of Leverkusen. But the complete realization came only
in 1925, after the lessons of the war had been learned
and chemists generally had grasped the fact that such
projects as hydration and the manufacture of artificial
rubber and plastics could be made commercially possible
only if research facilities and marketing were made joint
enterprises. IG Farben became a fact in 1925.
The thought of creating a monopoly never entered his
mind. He insisted, for instance, that for every factory
in the big merger that handled a certain product, a sec-
ond one must be built, so as to avoid scientific stagnation
due to monopoly. The two factories should in friendly
rivalry keep improving their product.
Duisberg was now 64 years old and felt that a younger
man should head this tremendous concern. Carl Bosch
was therefore chosen general manager, while Duisberg
himself became chairman of the board of directors. He
also accepted the honorary position of president of the
Reichsverband der deutschen Industrie, the office which
in 1931 he handed over to Krupp von Bohlen.
Theo Goldschmidt, president of the Chamber of In-
dustry and Commerce of Essen and himself a world-
famed chemist, has credited Duisberg with "bringing
about the marriage between science and technical mass
production in the chemical industry."
One of the greatest public services which Carl Duis-
berg rendered his country was that of founding the
41
 TYCOONS AND TYRANT

Economic Aid to the German Student Body ( Wirt-

schaftshilfe der deutschen Studentenschaft). Attend-
ance at universities took a disastrous drop in Germany
after World War I, due chiefly to the impoverishment
of the solid middle class. Duisberg persuaded the gov-
ernment to set up a special loan bank to enable academic
aspirants to study, repaying at reasonable rates after
graduation. He also solicited private funds for establish-
ing scholarships, setting up student homes with low rent
charges, installing student cafeterias with inexpensive
but wholesome food, organizing job possibilities, and
even providing opportunities for German students to
work in industrial plants in America for two years to
fit them for executive positions later in Germany. He
was tireless in approaching industrialists, bankers, trans-
portation companies, and rich farmers for contributions
to the Wirtschaftshilfe.
Duisberg was a prime mover in founding the Emer-
gency Federation of German Science (Notgemeinschaft
der deutschen W issenschaft), a central, all-comprehen-
sive organization for the furtherance of German re-
search. He was also a senator of the Kaiser Wilhelm
Society for the Advancement of Science and president
of the Association of German Chemists.
Duisberg's attitude toward Hitler and Nazism was one
of extreme scepticism. As he was no longer in active
management, however, he was spared many of the dif-
ficulties that his younger colleagues encountered.
Carl Bosch
Carl Bosch ( 1874-1940), head of the IG Farben Con-
cern from 1925 until his death in April, 1940, was a
scientist first and foremost, and an industrialist only
incidentally. In the United States he would probably
have headed one of the great scientific foundations
42
 FIGURES IN GERMAN INDUSTRY

rather than, let us say, the Dupont Concern. He was a

tireless inventor, one of the world's top scientists, who
at the same time had to occupy his mind with a thousand
and one details of practical business administration.
A native of Cologne, he went upon completion of
his high school course to Silesia, where he served as a
molder's, mechanic's and carpenter's apprentice in the
Marienhiitte, a big smelting concern. Next he attended
the Technische Hochschule Charlottenburg to study
machine construction and smelting. He really found
himself, however, only when he majored in chemistry
at the University of Leipzig. In April 1899, after having
earned his Ph.D. and after doing a year of practical
laboratory work at his Alma Mater, he entered the serv-
ices of the Badische Anilin- und Sodafabrik at Ludwigs-
hafen-on-the-Rhine as chemist.
From now on his rise was phenomenal. It was he who
developed Prof. Fritz Haber's process for making syn-
thetic ammoniac into one of the greatest chemical un-
dertakings of Germany. The synthetic nitrogen plant
near Merseburg, known the world over as the Leuna-
Werk, is his creation, as is the nitrogen plant at Oppau.
From synthetic nitrogen it was but a step for him to
manufacture synthetic fertilizer. No one fought harder
than he for investing unheard-of sums to make possible
large-scale production of synthetic gasoline. Wholesale
production of synthetic rubber ( Buna), although not
invented by Carl Bosch, was made possible because of
the economical manufacturing processes developed by
him.
Bosch was rather bored with matters of business and
organization, yet he proved again and again that he also
had a knack for these indispensable concomitants of
industry. Indeed, he often surprised his co-workers by
43
 TYCOONS AND TYRANT

his keen analysis and sure judgment of commercial sit-

uations.
By the time the Badische Anilin- und Sodafabrik
merged with other German chemical concerns, Bosch's
reputation was already so outstanding that he seemed
a ''naturar' to succeed Carl Duisberg as general manager
of IG Farben.
Carl Bosch had the universality of a Renaissance man.
His interests encompassed astronomy, botany, entomol-
ogy, geology, conchology, and music.
Carl Bosch, like his uncle, Robert, was one of the first
German entrepreneurs to put the eight-hour day into
practice, and when the Great Depression came in 1930
and many other concerns sought to meet it by dismissing
unnecessary help, amazed everyone by instituting the
five-day week.
He kept up the policy of his predecessor, Duisberg,
of building settlements with roomy, airy houses for his
workers, and rewarded all who had rendered outstand-
ing service by a special Christmas bonus. He had the
rare quality of listening, but was relentless in insisting
that his associates stick to the point.
Bosch took a deep interest in a Franco-German under-
standing and favored the co-operation of Aristide Briand
and Gustav Stresemann. He was interested in the Pan-
European movement of Count Richard Coudenhove-
Kalergi and saw to it that the IG participated financially
in a committee of economists in support of this move-
ment.
On the whole, however, politics did not intrigue him.
But when the Nazis started their persecution of the Jews,
he fought with every ounce of energy against the dis-
missal of Jewish scientists, and did not hesitate to tell
Hitler what he thought about race discrimination. Der
Fuhrer angrily beat the devil's tattoo on a window pane,
44
 FIGURES IN GERMAN INDUSTRY

then turned on his heels and left Bosch standing alone

in the study of the chancellery. Bosch never got over
his disappointment at Hitler~s insistence that his closest
collaborator, Dr. Ernst Schwarz, be removed because of
his "non-Aryan" background. He also protested against
the dismissal of Arthur von Weinberg, an outstanding
German-Jewish chemical scientist, head of the Casella
Company which fused with IG Farben.
As chairman of the board of the Kaiser Wilhelm So-
ciety for the Advancement of Science Carl Bosch resisted
all attempts to introduce Nazi politics into this world-
famed institution, and did everything within his power
-though in vain, for the Nazi decrees were inexorable-
to keep the Jewish scientists James Franck, Max Born,
and M. von Goldschmidt on its staff.
Bosch was outspoken about his aversion to Hitler long
before the Nazi chieftain came into power. In talks with
friends he referred to him as "that charlatan." One of
Hitler's economic advisers, Wilhelm Karl Keppler, be-
gan to assemble material against ~im and Hermann
Bucher, head of the German General Electric Company
( AEG), to be used for throwing these two men out of
their jobs as soon as the Nazis were in control. A mem-
ber of the Gestapo, however, who for some reason or
other was beholden to Bucher, one evening came to
bring his benefactor the dossiers concerning Bosch and
Bucher. The dossiers were burned in Bucher~s home.
Keppler looked in vain for the incriminating material.
As chairman of the board of the Deutsche Museum
in Munich it devolved upon Bosch on one occasion to
deliver a speech of welcome. That meant paying a trib-
ute to Hitler. The night before he told friends, "I just
can't deliver such a speech." So they suggested he should
claim illness and let his deputy speak. He agreed.
45
 TYCOONS AND TYRANT

The next morning he arrived-intoxicated. His friends

were unable to dissuade him from taking the chair.
Instead of praising the Fuhrer and his wondrous works,
Bosch launched into a defense of freedom and inde-
pendence of science from government. Hitler was men-
tioned only casually, and then in a rather derogatory
way. One Nazi after another left the hall demonstra-
tively in protest. The fact that Bosch had spoken in an
inebriate condition, hence was considered politically ir-
responsible, saved him from arrest. But the impression
was undeniable that Bosch had spoken his real feelings
about the regime.
The only concession he made to the Nazis was that
of agreeing that Dr. Carl Krauch, one of his finest tech-
nicians and his later successor as the head of IG Farben,
be "loaned" to Goring's Four-Year-Plan organization for
rendering Germany independent of foreign aid. His mo-
tive was that which obtruded itself fatally upon so many
other Germans-"um Schlimmeres zu verhuten,, ( Hto
prevent something worse").
His disappointn1ent in the turn that events were tak-
ing in Germany under Nazism led him more and more
to neglect his scientific researches and to seek forgetful-
ness in alcohol.
The thought that a life's work dedicated to peaceful
endeavor, to the production of goods intended to make
living more graceful, health more perfect, international
co-operation more efficient, was now perforce at the
mercy of a tyrannical war lord unbalanced him. His
friend, Hermann Bucher, has described this intellectual
giant's tragic collapse in these terms :
During the years before his death ( 1940) it became an
idee fixe with him that it was he himself who, without want-
ing it, had made Hitler's policies possible. For, without a
46
 FIGURES IN GERMAN INDUSTRY

synthetic nitrogen, benzene and rubber industry-in other

words, \vithout his personal achievement of a lifetime, of
which he believed that he had rendered a service to human-
ity-the insanity of this war would not have been possible.
He [Bosch] had striven for the good, but had given the evil
-he regarded Hitler as the personification of the Evil Prin-
ciple-its tools.
This notion caused him great suffering, both physical
and psychic. The thought of the uselessness of all his
efforts caused him to lose all interest in his job. He neg-
lected his work at least in the sense that he no longer
attended to it with energy and enthusiasm as before.
Scientific questions, the solutions of which he formerly
followed most actively, no longer interested him. For
months, sometimes for a whole year, he failed to visit
laboratories to which he had previously come regularly.
He took to drink under a sort of psychic compulsion.
Bosch became shy and unsociable and fell ill. He died
a lonely man. I am convinced that he had lost all will
to live and went to pieces due to the idiosyncrasy which
I have described and from which he found no escape.
Robert Bosch
Carl Bosch had an uncle, Robert Bosch of Stuttgart,
whose name will always be associated with the spark
plug and other accessories of the automotive industry.
Robert Bosch ( 1861-1942) was the son of an inn-
keeper at Albeck near Ulm, Wiirttemberg, who also
owned a patch of farm land and a small brewery, all
of which he sold in 1869 to move to the big city, Ulm.
After completing high school at Ulm and his mechanic's
apprenticeship in Ulm and Cologne, young Robert was
sent to the Technical University at Stuttgart to study
engineering.
From his mother, who was deeply interested in the
47
 TYCOONS AND TYRANT

fate of the workers, he inherited a social conscience

which was destined somewhat later to make him a pi-
oneer (together with his nephew, Carl) in establishing
the eight-hour day and Saturday afternoons off in his
plants. He received further stimulation for his social and
political thinking from the discussions he heard as a boy
in the Albeck tavern. His family had joined the rebels
of 1848 and his father had done two years' prison as a
political subversive.
A further decisive influence in his life was the drunken
master mechanic to whom he was assigned as a me-
chanic's apprentice. This master, an able optician, tele-
graph and telephone repair man, and watchmaker when
sober, failed utterly as a teacher and as an example to
his underlings. Robert Bosch always remembered these
unhappy years and was concerned throughout his event-
ful life about the decent bringing up of young mechanics.
During his military service in 1881 he found to his
satisfaction that he excelled in athletics. This fact en-
couraged him to keep up sports throughout his life.
Added to his passion for gymnastics was that for hunt-
ing, to which his father was also devoted. Young Robert
proved one of the best marksmen in Wiirttemberg.
As a young man of twenty-three he undertook his first
journey to the United States. The diary he kept indi-
cated that he was a keen observer and had an open
mind. He derived much profit from working for Sigmund
Bergman, one of Thomas A. Edison's men, and of meet-
ing Edison himself. He also made his first contact with
trade unions and took favorably to the socialist ideas
of the Knights of Labor. Many more visits to America
were later to follow, especially when the Robert Bosch
Magneto Company was formed at Springfield, Mass.,
and when, after World War I, he fought stubbornly and
48
 FIGURES IN GERMAN INDUSTRY

successfully for the return of his plant seized by the

Alien Property Custodian.
The stay in the United States was followed by a year
in England, where he worked in the British plant of the
Siemens Concern. After taking jobs in Magdeburg and
various other cities of northern Germany, Robert Bosch
at the age of twenty-five opened a shop for precision
tools and electrotechnics in Stuttgart. It was in this shop
that his famous magneto ignition was developed begin-
ning in 1887 which was soon to sell all over the world,
as it coincided with the great expansion of the auto-
motive industry.
The chief secret of Bosch,s success with his magneto
and the many other inventions which followed was his
insistence on absolute precision in workmanship. He also
discerned from the beginning that it was quite as lucra-
tive to manufacture automobile parts as it was to turn
out cars. To all suggestions that he engage in car build-
ing himself he replied wisely, "Do you think I want to
anger my customers by entering into competition with
them?,, A third factor is indicated in his favorite say-
ings, "It is better to lose money than the confidence of
your customers,,, and, "I don,t pay good wages because
I have lots of money, but I have lots of money because
7
I pay good wages., With the latter observation he antic-
ipated Henry Ford, one of his best customers.
Bosch was sincerely concerned about affording his
workers social security, healthy working conditions, and
conscientious training. He therefore regarded the claims
of the Nazis that they were opening a new era for the
common man with contempt. He was willing to match
any Nazi installation for the benefit of the workers with
similar ones long in use in his own plants.
This is not the place to consider the numerous Bosch
products in the way of automotive accessories, except
49
 TYCOONS AND TYRANT

to indicate a few of the principal ones: the claxon, the

direction indicator, the adjustable wrench, the wind-
shield wiper, the movable spotlight, the electric instal-
lations for the German Volkswagen. By 1924, Bosch had
sales organizations in twenty-one countries.
Like his nephew, Carl, Bosch was interested in
Franco-German understanding, as well as in the Pan-
European movement of Count Richard Coudenhove-Ka-
lergi, which he supported generously. To his Alma Ma-
ter, the Stuttgart Technical University, he donated one
million marks, and to the State of Wiirttemberg thirteen
millions for digging the Neckar Canal. While giving lib-
erally to many other causes, especially in the field of
education, he could bluntly refuse to contribute to a
project, however worthy, whose necessity he could not
see.
Straightforwardness and bluntness of expression were
so marked a characteristic of his that he considered him-
self a poor chairman and therefore turned down count-
less offers to head this or that society. One of the few
exceptions was that of presiding for twelve years over
the Wiirttemberg Industrialists Federation. He also ac-
cepted membership in the Priisidium (executive board)
of the Reichsverband der deutschen Industrie, where his
voice was often raised in favor of social justice.
All his life he was a rebel against conventionality; he
was in every sense of the word an individualist. His long,
flowing beard made him conspicuous. Swabian to the
core, he encouraged Swabian writers and was a devotee
of Swabian folklore. One of his main hobbies was a model
farm.
Hitler and Robert Bosch had a profound dislike for
each other. At their first meeting in September 1933, Der
Fuhrer angered Bosch by asking him at the outset,
50
 FIGURES IN GERMAN INDUSTRY

<<What do you want?" to which Bosch replied, "I don't

want anything-you asked me to come." After an embar-
rassing silence Bosch remarked, "You must feel rather
queer to be sitting in the chair of Bismarck."' Hitler
walked to a window furiously and beat a tattoo on the
pane, a characteristic gesture of his when angry, until
he had sufficient control of himself to continue the brief
interview. Bosch's later comment concerning this only
meeting a deux was, "He claims to be a statesman and
doesn't know what justice is." After that their few occa-
sional meetings were strictly formal. Invariably, Bosch
would greet Hitler with the customary South German
salutation, "Griiss Gott, Herr Hitler" ("God's greetings
to you, Mr. Hitler"), instead of the obligatory, "H eil,
mein Fuhrer.'' He declined consistently to attend the
annual Niirnberg rally of the Nazi Party.
When World War II broke out, he wrote to a friend,
Johannes Hieber:
"I'm glad the war has come. Ifs the only way to get
rid of those criminals.'' 2
He clearly foresaw that Hitler's declaration of war on
the United States presaged Germany's defeat.
Friedrich Flick
"Collector of Industrial Participations" is a term his
enemies applied to Friedrich Flick ( 1883-19-), head
of the Flick Concern. "One of the greatest steel men"
is the rejoinder of his friends and associates.
There is some truth in both statements. In a sense he
was a counterpart of the elder Hugo Stinnes-restless,
full of energy and initiative, forever acquiring and sell-
ing industrial properties and shares, getting in and out
2. Theodor Heuss, Robert Rosch-Leben und Leistung (Stuttgart
and Tiibingen; Rainer Wunderlich Verlag, 1946) , p. 684.
51
 TYCOONS AND TYRANT

of combines. He differed from the senior Stinnes, how-

ever-and this is where the praise of his friends has its
place-in that he never went beyond iron, steel and coal,
whereas Stinnes during the great inflation period seemed
to be ready to buy anything that was for sale besides
steel and coal companies. 8
Friedrich Flick, now a vigorous septuagenarian whom
imprisonment as a ccwar criminal'' has not been able to
break, knows steel and what is needed for its produc-
tion inside out. Born July 10, 1883, in Kreutztal, a small
town in what is known as the Siegerland, a section of
Westphalia to the southeast of the Ruhr region, a
farmer's son, he became interested in iron mining, of
which there was much in the neighborhood. His father
had many connections with the miners. From early man-
hood on young Friedrich had the desire to become asso-
ciated with iron and steel. With a decided flair for finan-
cial operations, however, he interested himself in the
commercial side of this growing industry.
His training, accordingly, after finishing high school
was not, as was the case with some of the other tycoons
in the heavy industries, along engineering or applied
sciences lines, but on the commercial side. He served his
apprenticeship in the business administration of the
Bremerhiitte, a steel company at Weidenau, Westphalia,
and after doing his military service in Kassel, went to
the School of Commerce (of university grade) at Co-
logne.
In 1907 he returned to Bremerhiitte as a full-time
employee and although only twenty-four years old, so
distinguished himself that his firm the same year made
him Prokurist, i.e. its deputy on the business side with
the right to sign checks, contracts, etc., in the firm's
3. Cf. Chapter Six, p . 126.
52
 FIGURES IN GERMAN INDUSTRY

name. It was sensational in those days for any company

to show such a trust in so young a man.
Five years later he was called into the Vorstand (man-
aging board) of the Eisenindustrie zu Menden und
Schwerte A.G., again an unusual achievement consid-
ering his age.
But his truly exceptional career began fully in 1915,
when he became a member of the Vorstand of A.G.
Charlottenhiitte in Niederschelden, one of the leading
steel concerns of the Siegerland. Here he was given a
free hand. He found that, on the one hand, the neces-
sities of war demanded a concentration of production,
and on the other, that the companies of the Siegerland
were in danger of being swallowed by the expanding
industries of the Ruhr. He succeeded in persuading a
number of smelters, iron ore mines, rolling mills~ and a
railway car manufacturing concern to merge with the
Charlottenhiitte, which remained the core of his under-
takings until its fusion in 1934 with the Central German
Steel Works, of which he became chairman of the board.
Flick tried to acquire enough iron ore and coal mines
to make himself independent as far as raw materials were
concerned, but the Ruhr industrialists were stronger
than he and prevented this. So he turned east. The Char-
lottenhiitte in 1919-20 acquired a majority of the shares
of the Bismarckhiitte in Silesia, which happened to pos-
sess ore mines in the Siegerland and the Harz Moun-
tains. A little later he also acquired the Upper Silesian
Iron Industry Company.
During the early twenties Hugo Stinnes Sr. had be-
come a big factor in the Ruhr heavy industry. He was
now the dominant figure in the Rhein-Elbe Union. Some-
how Flick managed to acquire a large share participa-
tion in the Rhein-Elbe Union and the Linke-Hoffmann
53
 TYCOONS AND TYRANT

Concern, thereby gaining access to two much-needed

commodities-coal and scrap iron.
The economic crisis following the stabilization of the
Reichsmark in 1923 necessitated new concentrations and
mergers. In the east, the Oberschlesische Hiittenwerke
(Upper Silesian Steel Works) were founded by a mer-
ger in which the Charlottenhiitte holdings in the east
participated. In the west the colossal United Steel Works
were founded with the Rhein-Elbe Union as a core.
Flick merged most of his western companies with United
Steel.
As active a man as he could not be happy, however,
thus to be merely a rich man with nothing to do except
sit on boards of directors. He craved personal produc-
tion. Hence, by 1931, he was completely out of United
Steel again, acquired coal and lignite mines in the Prov-
ince of Anhalt and near Essen, bought several additional
steel plants in Saxony and Lubeck, and dug for iron ore
in Bavaria and Thuringia, besides going in for railway
car and machinery manufacture. The Friedrich Flick
Concern was now a fact.
One of his outstanding contributions to the steel in-
dustry was his extensive use of steel shavings in blast
furnaces. Another was his early realization of the impor-
tance of scrap metal to the steel industry.
Friedrich Flick brought both concentration and devo-
tion to the numerous tasks that management of so large
a concern entailed. His capacity for working over moun-
tains of reports was a constant source of amazement to
his assistants, who stood rather in awe of his striking,
forceful personality. Tall, slim, with a somewhat droop-
ing mouth that often seemed like a sneer to those who
did not know him well, he demanded much of his asso-
ciates, but in return was generous, giving liberally to all
sorts of worth-while causes. Also, he saw to it that his
54
 FIGURES IN GERMAN INDUSTRY

workers had good housing and proper social security.

He supported all political parties that opposed commu-
nism.•
Of all German top tycoons he has perhaps the fewest
hobbies. Even when he doodles he, always a business-
man, adds figure upon figure. He finds relaxation in play-
ing with his grandchildren, whose exploits he narrates
proudly.
With dozens of other German industrialists he sat for
months in the prison of the American Occupation Forces
at Landsberg. He was indicted with five of his associates
for war crimes and crimes against humanity in exploit-
ing slave labor. He was cleared of the charge of having
committed war crimes but found guilty of using slave
labor. He received a seven-year sentence on December
22, 1947, but was released by United States High Com-
missioner John McCloy on February 3, 1951, together
with other German industrialists. 5
During his trial a number of character witnesses, in-
cluding men now in high office in the Adenauer Govern-
ment who cannot possibly be charged with being Nazi
sympathizers, testified that Flick had been outspoken
in his denunciation of Nazism. Somehow his personality
so impressed his American guards that they permitted
him to hold directors' meetings of his concern inside the
prison. He was the only entrepreneur accorded this
privilege.
After his release Flick resumed personal management
of his companies with a vigor which few others could
muster. His spirit was unbroken, his mental agility even
now shows no signs of weakening. Facts and figures are
stored safely in his encyclopedic mind. His snow-white,
abundant hair, his ruddy, healthy complexion, his youth-
4. Cf. Chapter Five, p. 92.
5. Cf. Chapter Twelve, p. 250.
55
 TYCOONS AND TYRANT

ful, blue eyes, big, generous ears and prominent nose

make him conspicuous in any gathering or group.
Albert Vogler
The sharp eye of Hugo Stinnes Sr. picked a young
engineer named Albert Vogler ( 1877-1945), then em-
ployed by the Georgsmarienhi.itte, a steel concern at
Osnabri.ick, as a coming man and offered him a direc-
torship in the Dortmund Union iron and steel combine.
It was most unusual to place a man of only twenty-seven
in so high a position. But Stinnes was right-Albert
Vogler showed unusual organizing and rationalizing tal-
ents and within a short time pulled the Dortmund Union
out of the red.
The son of a simple miner, Vogler, born at Essen-
Borbeck February 8, 1877, studied machine building
and construction at the Technical University of Karls-
ruhe.
So successful was he in reorganizing the Dortmund
Union that Stinnes in 1915 offered him the post of gen-
eral manager of the German-Luxembourg Mining and
Steel Manufacturing Company. His meteoric career at-
tracted wide attention, with the result that the Verein
deutscher Eisenhiittenleute (Association of German Iron
Works Owners) in 1916 elected him president of their
organization. For nearly twenty years Vogler continued
to head this group, which was regarded as one of the
most eminent associations of technical experts in Ger-
man economic life.
The German iron and steel industry of the Rhineland
and Westphalia, as already indicated, was in a bad way
after the lost war of 1914-1918. Steel production had
dropped from eighteen million tons to six millions. Tech-
nically the German concerns were not up to standard,
as all energies had gone into feeding arms to the battle
56
 FIGURES IN GERMAN INDUSTRY

front. There seemed to be but one solution: rationaliza-

tion by merger. Albert Vogler was a pioneer in advocat-
ing such a bold step. His viewpoint prevailed, and he
was selected as the first director-general of the V erein-
igte Stahlwerke (United Steel Works) when this com-
bine was perfected in 1926. He held this position for
ten years and then yielded it to his friend and deputy,
Ernst Poensgen, with himself becoming chairman of the
board.
While the merger of leading steel and coal companies
was in progress, Vogler found time for about a year to
preside over the Rhenish-Westphalian Coal Syndicate.
He had already become a member of the German Re-
public>s Reichstag from its inception in 1919, and con-
tinued to serve in this capacity for twenty-six years.
Besides Hugo Stinnes and Carl Friedrich von Siemens
he was one of the few tycoons who entered the Reichs-
tag after the abolition of the monarchy.
Vogler>s life's work was that of bringing order out of
chaos in the steel industry. In this he succeeded so well
that he was able to report to the stockholders at the
height of the depression in 1933 that at last, after six
years of intensive reorganization, of concentrating on
revenue-earning production, of abandoning nonprofit-
able coal pits, and of eliminating plants that were run
at a loss, United Steel with its two hundred thousand
workers was producing at a profit.
Although he never joined the Nazi Party, he compro-
mised to the extent of letting Adolf Hitler place him on
the list of candidates for his yes-men Reichstag, which
of course meant his election. It appears that he believed
by going along he might avert excesses. Vogler remained
a Reichstag member to the end, a conspicuous figure
because in the closing years of the Nazi regime he was
the only deputy who wore no uniform. Qualms of con-
57
 TYCOONS AND TYRANT

science seem to have made him decide upon this form

of demonstration.
In August 1939, he visited Hermann Goring to lay
before him a report which his company had received
from America, according to which a war with England
would inevitably draw the United States into the con-
flict on Britain's side. The report further emphasized that
American industry was so superior to the German that
the Reich would simply be overpowered by tanks and
aircraft. Goring refused to take the report seriously.
C(You seem to believe," he said, "that an American can
land on a coast on which German soldiers are on guard.,
Always interested in scientific progress and an ardent
supporter of the Kaiser Wilhelm Society for the Ad-
vancement of Science, he was chosen president as the
fourth man to be awarded this honor-after Adolf von
Harnack the theologian, Max Planck the physicist, and
Carl Bosch the chemist. He had planned to spend his
declining years in the Berlin suburb of Dahlem, the seat
of the Institute, where he hoped especially to work with
scientists Adolf Butenant (biological chemistry), Otto
Hahn (radioactivity), and Werner Heisenberg ( theoret-
ical physics).
He had also hoped to complete his researches, cover-
ing many years, in the field of workers' participation in
the profits of the companies in which they are employed.
He had worked out a comprehensive plan for profit-
sharing by employees, which he intended to push vig-
orously after the war.
It was not to be. On Aprill4, 1945, a small group of
conquering soldiers entered his home near Dortmund
via his wine cellar, to the contents of which they helped
themselves. Feeling high they began to molest Mrs.
Vogler. When her husband tried to protect her, they
58
 FIGURES IN GERMAN INDUSTRY

beat him up and dragged him to their jeep. Vogler swal-

lowed poison. A few minutes later he was dead.
Ernst Poensgen
Ernst Poensgen (1871-1949), director-general and
later chairman of the board of the V ereinigte Stahlwerke
(United Steel Works), was one of the most liberal and
international-minded leaders that the German steel in-
dustry has produced. He was an entrepreneur by pre-
dilection and inheritance. For, his forbears had for
centuries possessed iron foundries, wiredrawing mills,
smelters, and rolling mills in the Eifel Mountains, and
in 1860 had settled with most of their skilled workers
in Dusseldorf, where they founded the Poensgen Steel
Tube and Iron Rolling Mills.
Ernst as the oldest of ten children was trained by his
father, Carl, and later in various technical universities,
to become his associate and successor. He was one of the
moving spirits during the negotiations for the founding
of United Steel and in 1936 became its director-general.
Poensgen never held a narrow view regarding his
work and position. In fact, some shareholders of United
Steel at times criticized him privately for being so fair
to his competitors as to seem to neglect the specific in-
terests of his firm. His view, however, was a long one
and the concessions he was willing to make were calcu-
lated to help the steel industry as a whole. This was true
not only on a national, but also and especially on an in-
ternational basis.
He thus became the prime mover in the creation in
1926 of the Continental Steel Cartel, a forerunner of the
coal and iron international co-operation envisaged in the
Schuman Plan. 6 Despite certain strains that still existed
6. Cf. Chapter Ten, p. 190.
59
 TYCOONS AND TYRANT

as an aftermath to World War I he managed to secure

the confidence of his Belgian, French and Luxembourg
colleagues, and so enthused his British opposite numbers
that he was elected an honorary member of the British
Iron and Steel Institute.
"We were of the opinion," he wrote later, "that the
international cartels would contribute essentially to in-
ternational understanding and to the safeguarding of
~~

peace.
Poensgen only very rarely lost his temper. One such
occasion was supplied by Goring~s sending a secret tele-
gram to a number of industrialists forbidding them to
stand by their expressed promise to support Poensgen
in his opposition to the erection of the uneconomical
Hermann Goring Werke at Salzgitter.1 On learning of
the telegram, he slammed the door with a bang and left
his office.
At all sessions his was the voice of conciliation and
useful compromise. His Rhenish humor helped him to
relieve tension and his hobby, sports, kept him fit and
elastic.
Often, when divergent interests seerned to preclude
any solution, he would leave the meeting and clear his
brains by rowing on the Rhine. In the solitude of his
skiff he then evolved an acceptable con1promise. Mean-
while in the smoke-filled conference room of the Stahl-
hot in Dusseldorf, headquarters of the German steel
interests, his colleagues had talked themselves hoarse
and were weary and anxious for someone to point the
way out of the impasse. Usually they then voted unani-
mously for the resolution which Poensgen had drafted
in his boat.
His gift as a mediator attracted attention beyond steel
7. Cf. Chapter Nine~ p. 175.
60
 FIGURES IN GERMAN INDUSTRY

circles. Poensgen was elected a member of the govern-

ing board of the International Chamber of Commerce,
a member of the Reichswirtschaftskammer (Federal
Economic Chamber), of the Langnamverein (Long
Narne Society) for the safeguarding of the interests of
industry, 8 and other organizations. He always stood
for freedom of the personality and never wanted the
heads of organizations tied down by rules and regula-
tions which hemmed in initiative.
For many years he was president of the Northwest
German Employers' Federation. Here he became thor-
oughly aware of the tremendous importance of the so-
cial question. He stood adamantly in favor of mutual
recognition of the trade unions and the employers' or-
ganizations as the bue representatives of their respec-
tive interests, and protested publicly when in 1933 the
Nazis seized and dissolved the trade unions.
He became increasingly unbearable for the Nazis
who, however, for years hesitated to remove him from
his powerful position since they knew of his indispensa-
bility. By 1942, however, they finally forced his resigna-
tion.
His services to his native city were numerous. Many
sports fields in the Dusseldorf area owe their existence
to Ernst Poensgen. He was an ardent patron of the Dus-
seldorf Theater.
Paul Reusch
A Swabian who became a Ruhr tycoon is Paul Reusch
( 1868-19-), one of the few living top leaders in pres-
s. The official name was V erein zur W ahrung der gemeinsamen
wirtschaftspoliti.schen Interessen im Rheinland und Westfalen ( Asso-
ciation for the Safeguarding of Common Economic Interests in the
Rhineland and Westphalia). It was not long before everybody called
the organization the Long N arne Society for short.
61
 TYCOONS AND TYRANT

ent-day German industry whose careers date back to

the Weimar Republic. At eighty-six he is still going
strong, a wise old man to whom many tum for advice,
who has had the good sense with progressing age to
hand his major holding, the Cute Hoffnungshiitte of
Oberhausen, over to his able son Hermann while him-
self continuing to direct several subsidiary enterprises
near his home outside Stuttgart.
His retirement to his beautiful estate, the Katarinen-
hof, was not altogether voluntary. His residence in
Oberhausen was destroyed by air action. There was
nothing to hold him in the Ruhr region after that, for
the Nazis had insisted upon his removal and that of his
son from the Cute Hoffnungshutte in 1942 because of
their continued opposition to the regime. So he built
himself a new abode in Stuttgart, but this, too, was laid
in ruins. His vacation home with its spacious meadows,
wooded groves, and a beautiful garden studded with
sculptures of the great men in Germany's past then be-
came his permanent residence.
Paul Reusch was born February 9, 1868, in Konigs-
bronn, a small Wurttemberg town where his father was
a mining expert. He attended the Technische Hoch-
schule of Stuttgart, specializing in mining and steel. He
next gained practical experience as an engineer in the
Tyrol, in Budapest, Hungary, and in Witkowitz, Mora-
via, and in 1901 was invited by the Krupp Concern to
become director of the Friedrich-Wilhelmshiitte in Miil-
heim-on-the-Ruhr.
Four years later he accepted an attractive post with
the Cute Hoffnungshiitte, and by 1908 advanced to the
position of chairman of the V orstand, in other words, to
the top command post. His efficiency is demonstrated by
the fact that the number of employees rose from nine-
teen thousand at the time he joined the concern to
62
 FIGURES IN GERMAN INDUSTRY

eighty thousand in the mid-twenties. He had come into

the Ruhr community an unknown man, without connec-
tions or relatives or friends, called by Krupp solely be-
cause of his ability, but in a few decades emerged as
one of the most important German industrialists.
"People don,t read history enough, is his comment to-
day when asked how he managed to pull his company
through the many economic crises with which Germany
has been faced since losing World War I. Himself a dili-
gent student of the past, he sensed what must be done
to outlast inflationary periods, depressions, and artificial
booms.
Tall, spare, forceful, amazingly frank in his expression
of views and opinions, Paul Reusch was and still is today
a figure whose blunt criticism is feared by those at whom
it is aimed. Unlike many industrialists he considered it
his duty to serve in public and semi-public bodies such
as the city council of Oberhausen, the chamber of com-
merce of Duisburg, the Reichsverband der deutschen
Industrie, and the Bank for International Settlements at
Basle. For many years he was president of the powerful
Long Name Society and of the Northwest Group of
German Iron and Steel Industrialists.
A pronounced foe of the labor unions, he nevertheless
approved of the efforts of Hugo Stinnes Sr. to bring
trade unions and employers' federation leaders to-
gether.9
Reusch loved to surround himself with artists, au-
thors, and men of science. Many an artist was helped by
a commission from the wealthy industrialist to paint a
picture or sculpt a statue.
Dearest to his heart was and is the Deutsche Mu-
seum in Munich, founded by his close friend Oskar von
9. Cf. Chapter Six, p. 129.
63
 TYCOONS AND TYRANT

Miller. For many years he has been a member of the

governing board.
Though not a politician, Paul Reusch nevertheless ob-
served political life closely, and enthusiastically joined
the Bund zur Erneuerung des Reichs (Society for the
Regeneration of the Reich) founded by former Chan-
cellor and Ambassador Hans Luther. This organization
put a great amount of energy into the effort to convince
the German people and the politicians that the electoral
system of the Weimar Republic was a serious digression
from common sense.10
Reusch never concealed his aversion to Nazism. The
same fearlessness which he evinced in his business deal-
ings he now showed in his encounters with Nazis from
Hitler down to the smallest ward heeler. They found
him more than embarrassing, but had to wait until1942,
after the last ties with the western world had been sev-
ered, before they dared force him into private life. Dis-
missal was immediate, without warning, and the press
was forbidden ever to mention his name again.
Hermann Bucher
A plant pathologist as head of the colossal Allgemeine
ElektriziUitsgesellschaft ( AEG) -General Electric Com-
pany-of Germany! Many German industrialists rubbed
their eyes in wonderment when Hermann Bucher, scien-
tist and diplomat, became the successor of Emil Rathe-
nau, the founder, and Walther, his son, in 1928.
Nothing in his early youth had indicated such a turn
in his life. Born August 28, 1882, in Kirberg, County of
Wiesbaden, as the eighth child of an artisan, young Her-
mann was destined by his father to become a gardener's
apprentice. Hermann's imagination had been fired, how-
10. Cf. Chapter One, p. 3.
64
 FIGURES IN GERMAN INDUSTRY

ever, by the stories of foreign lands which his father's

journeymen told. He wanted to acquire an education
and see the world. He therefore wrote his uncle, Karl
Bucher, Professor of economics at Leipzig University,
imploring him to persuade his parents to let him study.
Uncle Karl's eloquence bore fruit.
The nearest Gymnasium, approximately equivalent to
an American senior high school, was the Philippinum at
Weilburg. On more than one occasion he celebrated the
beginning or end of a vacation period by walking all
the way from Weilburg to Kirberg and vice versa, a dis-
tance of about nineteen miles. On his arrival home with
burning feet, his mother, who was one of the greatest
influences in his life, invariably poured him a big glass
of delicious sour milk to revive his spirits.
As Gymnasiast Hermann Bucher was not a star pupil
except in the studies which interested him especially-
botany and geography. He was never seen except with
a big pipe emitting clouds of smoke, arguing with his
teachers in a manner that exasperated them, and even
daring in his senior year to espouse the cause of Social-
ism. Possessed of a beautiful bass voice, he joined the
Gesangverein Keuchhusten (Whooping Cough Singing
Society) , which was as devoted to drinking as it was to
singing.
From Weilburg he went to Leipzig University. He
was anything but a bookworm and repeatedly engaged
in student duels ( Mensuren). Nevertheless he was grad-
uated with highest honors-summa cum laude-in 1906.
His doctor's dissertation, dealing with botanical re-
search, was dedicated to his mother.
The German Colonial Office sent him to the Agricul-
tural Experiment Station at Victoria, in the Cameroons,
a Western African German Protectorate, as plant pa-
thologist. From there he was sent to Java and Sumatra
65
 TYCOONS AND TYRANT

to study Dutch agricultural and botanical methods. On

the occasion of his thirtieth birthday he was promoted
to Regierungsrat (government counsellor) as the young-
est man to hold this title. Tropical fevers, however,
forced him to abandon his colonial career. He was trans-
ferred to the Colonial Office at Berlin as chief expert on
tropical agriculture.
When, at the end of 1914, the grasshopper plague in
Turkey threatened to interfere seriously with food sup-
plies to embattled Germany, Bucher vvas sent to the
Ottoman Empire to assist the Turkish nninistry of agri-
culture in fighting the scourge. His experience was later
summarized in a brochure entitled, "The Grasshopper
Plague and How to Fight It." Bucher became the Turk-
ish agricultural minister's right hand until the end of
the war.
In 1919 a further important \Vork of his was pub-
lished: "The Oil Palm." Although Germtany had mean-
while lost the war and with it her cololflies, Bucher, in
collaboration with his life-long friend, DJr. E. Fickendey,
decided to publish the story of their investigations and
findings because, he said, "it would benefit the former
enemy" and because "it would in part answer the ques-
tion as to whether the Germans knew how to colonize."
In 1920 Bucher was invited to become Expert-
General in the Division of Economic Afl:airs of the new
German Foreign Office. His job was to deal with foreign
trade policies, and especially with economic and finan-
cial questions arising from the Treaty o:f Versailles and
from Germany's reparations obligations.
In 1921 the Reichsverband der deutschen Industrie
offered him the position of executive director. The idea
of working without governmental and bureaucratic in-
terference intrigued him. In his new job he was espe-
66
 FIGURES IN GERMAN INDUSTRY

cially interested in promoting peace between capital

and labor.
In one of the first speeches delivered during his four
years with the Reichsverband he said:
As far as I am able to exert any influence I shall always
champion the idea that the entrepreneurs should strive for
industrial peace . . . . I favor strong trade unions, because
I have learned by experience that I am always better off
when I have an opposite number who is sure of himself
than when I am dependent upon incalculable imponder-
ables.
In 1925 the IG Farben chemical trust enlisted him in
its services; in 1928 the AEG gave him a commanding
position which soon led to the chairmanshi]? of the man-
agement board. He was now the top boss-and for
twenty years remained such-of a concern dealing with
electricity, a branch of knowledge new to him.
The company, virtually on the rocks financially, under
his leadership soon was pulled out of the red. Above all,
he was able to transmit to workers, employees, and col-
laborators a feeling of security and pride in their com-
pany.
For many years the AEG had maintained an exchange
of patents and inventions with the General Electric
Company of America. This relationship, begun by Emil
Rathenau in 1883, was interrupted by World War I but
resumed soon after peace had been declared. Bucher
helped further to develop and deepen it.
He took a deep interest in scientific research and
enthusiastically supported the N otgemeinschaft der
deutsches Wissenschaft and the Max Planck (formerly
Kaiser Wilhelm) Gesellschaft zur Forderung der Wis-
senschaften.
When the Nazis took over, he made no secret of his
67
 TYCOONS AND TYRANT

disgust at their practices, and often had to be warned

by friends not to be so outspoken in the presence of
strangers. That there were spies among 1these strangers
would seem to be indicated by the fact that Ernst Kal-
tenbrunner, Rimmler's right hand in the SS, had marked
him for execution after the July 1944 attetnpt on Hitler's
life. Biicher's name was removed from the list of purgees
only at the insistence of Albert Speer.
Bucher returned from his only conference with Hitler
in 1934 with the words: "There's nothing one can do
with that fellow ( Kerl) . He won't listen to anyone.
Common sense arguments carry no weight with him."
The smashing of Jewish shops, the burning of syna-
gogues and the wholesale arrests of German Jews in No-
vember 1938 so offended Biicher's sense of justice that
he told his board of directors he doubtedl whether Ger-
many could still be called a cultured nation. He then
continued :
Gentlemen, if anyone in this undertaking now attempts
to seize upon this occasion to purchase Jewish properties
for the AEG I'll dismiss him without notice.
When it proved no longer possible for him to retain
Jewish employees because of the Niirnberg laws, Biicher
saw to it that each dismissed person was given proper
severance pay and, whenever possible, a position in
some foreign country.
He had the courage to call Hitler and Goring H asar-
deure (adventurers) in a public speech. Early in the
war he expressed the opinion that Germany would lose.
He accepted war contracts only when forced by the
regime, and acquired no plants abroad except two that
had formerly belonged to the AEG and ·which he now
paid for fully and to the satisfaction of the sellers. De-
spite heavy Nazi pressures the AEG under his leadership
68

r ·
 FIGURES IN GERMAN INDUSTRY

even during the war devoted only 11 per cent of its ef-
forts to war production.
Biicher was tall, strong, with a generous mouth, white
hair, dark mustache, and expressive hands.
Although the entire AEG Works Council testified that
Biicher had never been a Nazi, he was prevented by the
Allies until1948 from engaging in any industrial enter-
prise whatsoever. In the early days of the Occupation,
when the HMorgenthau boys" held sway in many depart-
ments of Military Government, all Hcapitalists" were
suspect.
Death overtook Hermann Biicher on July 14, 1951.
Carl Friedrich von Siemens
Carl Friedrich von Siemens, head of two huge electri-
cal concerns, Siemens & Halske and Siemens & Schuck-
ert, was as much at home in the English speaking world
as he was in his native Germany. He was born in Berlin-
Charlottenburg on September 5, 1872, a late child-the
sixth and last-of a famous father, Werner von Siemens,
founder of the Siemens industrial and banking dynasty.
Young Carl Friedrich's adolescent years were spent
like those of many youths of wealthy parents: he be-
came more or less of a gay blade and had to be liberated
by an older brother from a Hgold digger" marriage; he
went to England and the United States in 1893 to take
in the Chicago World's Fair and the Yellowstone Park;
he did his year's military service with the swanky Fif-
teenth Uhlans at Strassburg; he attended the Technical
University at Munich; in 1898 he married a rich Berlin
brewer's daughter.
Then came the great change: joining the management
staff of Siemens & Halske in 1899 he suddenly sobered
up completely and for the next forty-five years was inti-
mately identified with the Siemens business empire.
69
 TYCOONS AND TYRANT

The Paris Exposition of 1900 and his services on the

board of directors of Siemens Brothers of London begin-
ning in 1901 greatly widened his understanding and
outlook and, together with his American experience,
gave him a broad insight into international conditions.
England~s architecture and landscape gardening capti-
vated him. He applied both when Siemenstadt, a huge
labor settlement on the outskirts of Berlin, was founded.
Carl Friedrich's rise was rapid: in 1906, at the age of
only thirty-four, he was promoted to manager of a new
London concern, the Siemens Brothers Dynamo Works,
Limited.
Extensive travels in the United States, where he made
a close study of the Niagara Power Plant and the Wes-
tinghouse and General Electric Companies, and in the
Orient developed a keen sense of realizing what other
nations and peoples wanted and needed in the way of
electrical supplies. He advocated bringing young men
from non-German plants of Siemens to Germany and
sending German employees abroad.
Although possessed of a fine sense of humor and en-
dowed with a marked ability to tell stories charmingly,
he was most reluctant to speak in public and overcame
this impediment by sheer will power only when his in-
dustrial position and his official career made public ap-
pearances inevitable.
He became chairman of the board of Siemens &
Schuckert in his fortieth year. During World War I, after
a frustrating stint as chauffeur in the German army, the
government appointed him co-ordinator of the electro-
technical industry. In spite of this official position he
sharply opposed the annexationist aims of the V aterland
Partei backed by Ludendorff and Hugenberg.
In the performance of his task as co-ordinator he be-
70
 FIGURES IN GERMAN INDUSTRY

came aware that few German industria]!ists had any

knowledge of practical politics. From then on he advo-
cated greater participation of men of affairs in the life
of the nation, especially after the imperial regime had
given place to the Weimar Republic, and set an example
by accepting the nomination of the German Democratic
Party for the Reichstag. He retained his seat in the post-
war German federal parliament until requested by the
government to become a member of the board of the
German Reichsbahn, or federal railways, in 1924. The
board unanimously elected him chairman. Under the
circumstances this was a high tribute to his integrity.
The young German republic had no sooner begun to
function, than his oldest brother, WilheJlm, who had
been almost like a father to him, died in 1919. Carl
Friedrich succeeded him as head of the Siemens under..
takings and for the next twenty-two years was one of
the eminent figures in German economic life.
He was careful to continue and expand tl~e social poli-
cies of his father and brother. Model workers' homes in
garden colonies with detached houses, playgrounds and
TB sanatoria for children, hobby shops and club houses
for the grownups, a rational and scienti£ic system for
arriving at proper pay for his almost sixty thousand em-
ployees, the introduction of a system of visiting indus-
trial nurses, the stretching of work during slack periods-
these were some of the achievements of his industrial
. ,
" reign.
Though not opposed to trade unions he, at the same
time, fought their idea that merely years of service, ir-
respective of efficiency, must determine wages, vacation
time, severance pay, and allied matters. He acknowl-
edged the workers' right to strike but was opposed to
purely political walk-outs.
71
 TYCOONS AND TYRANT

His attitude toward democracy was expressed in these

words when he was campaigning for the Reichstag in
1920:
In a real democracy every human being must respect his
fellow man; he must respect his achievements and his hon-
est opinions, whether he be on the same plane with him or
a subordinate. . . . The right to criticize freely and inde-
pendently, even when the state or his own organization is
involved, seems to me to be an essential characteristic of
democracy and to be inextricably connected with the free-
dom of the individual and the democratic structure of a
state.
Within his various plants, however, politics was taboo,
even when the Nazis took over and tried to convert
every shop into a propaganda cell.
At an early stage Carl Friedrich, unlike many of his
colleagues, became aware of the implications of Nazism.
Speaking in 1931 before a closed meeting of General
Electric executives in New York, he pointed out that
Hitler was a dangerous man because he appealed to the
unselfishness, the patriotism and the nationalism of his
listeners. "Too few people realize that Hitler is drawing
idealists from all sections of the population to his ban-
ner,'' he observed. He made it quite clear that industri-
alists like himself were opposed to Hitler, but that this
circumstance must not blind one to the fact that the
Nazi leader was a power.
Hitler and Siemens never clicked. When Carl Fried-
rich was compelled to visit Der Fuhrer in his capacity
of chairman of the German Railways Board, Adolf Hit-
ler gave him an hour's monologue on politics without in
any way touching upon the problems of the railway,
then curtly dismissed him.
Just as soon as the Nazis began to interest themselves
in the Reichsbahn, friction developed between Siemens
72
 FIGURES IN GERMAN INDUSTRY

and the Hitlerites. Politics had been kept out of the

Reichsbahn management; the Nazis insisted upon politi-
cal control here as everywhere. Three members of the
governing board as well as the director of the financial
section were Jews; the Nazis insisted upon their re-
moval. By 1934 Siemens had resigned. He :found further
resistance useless. Nazi strength was overpowering.
Many Jews held positions of trust in the Siemens Con-
cern. Carl Friedrich did everything feasible to retain
them, but when he failed, gave them fine letters of char-
acter to foreign electrical concerns and generous sever-
ance pay.
Von Siemens consistently declined inviltations to at-
tend the annual Nazi Party rally at Ni.irnberg.
His outspoken opposition to Hitler and Nazism re-
sulted in considerable friction also between himself and
a number of other German tycoons, who believed in
handling the Nazis cautiously. Relations became espe-
cially strained with the Reichsverband der deutschen
Industrie, which with Krupp von Bohlen at the head was
pursuing a more conciliatory policy toward the new re-
gime, only to be dissolved in due time.
When the Nazi regime compelled indus1try to engage
widely in arms production, Siemens was careful to or-
ganize temporary subsidiary companies to handle most
of these contracts, in order that his two principal con-
cerns be not tainted with the term "defen:se plant" but
be enabled to resume full-time peace production at the
earliest possible moment. He thus succeeded in restrict-
ing war production at Siemens & Halske to eighteen per
cent of the total output and at Siemens & Schuckert to
11.9 per cent. He also refused to tum his plants over to
purposes other than electrical goods manufacture. Even
when threatened by Air Marshal Erhard ~1ilch to have
him shot for sabotage he was not impressed.
73
 TYCOONS AND TYRANT

To a relative, Professor Georg Siemens, he wrote:

If only we had no Wehrmacht contracts! I'd a hundred
times rather deliver motors, radio sets, vacuum cleaners,
telephones and similar harmless things needed in daily life
to the consumers and figure out how electrical energy can
be produced and distributed more advantageously, than to
manufacture this stuff which in the last analysis is only an
accessory to destruction.
Nazi Labor Leader Ley, visiting a Siemens plant one
day during the war, gave vent to his anger in these
words: ~~This factory is a filthy hole: nobody saluted me
with 'Heil Hitler.' It is a Jewish-democratic outfit."
Though not himself a man of science but rather an
organizer and entrepreneur, Carl Friedrich von Siemens
was a generous donor to the Emergency Federation of
German Science and for fourteen years headed its Stif-
terverband (Organization of Founders).
Busy though he was, he nevertheless took time out
for recreation. "Acquire hobbies" was his advice, oft
repeated, to his only son Ernst. In England he had be-
come an enthusiastic polo player and yachtsman, in Ger-
many he added tennis and hunting to his recreations.
Music, on the other hand, had no attraction for him.
When death came to Carl Friedrich von Siemens on
July 7, 1941, no message of condolence arrived from
Adolf Hitler, no wreath was sent on his behalf, and no
Nazi Party member as such represented the Hitler
movement at the obsequies. Dr. Julius Dorpmiiller,
minister of transportation, was permitted to pronounce
a brief eulogy, not as a cabinet minister of the Nazi re-
gime, but solely as head of the German Federal Rail-
ways whose chairman of the board the deceased had
been for nearly ten years.
74

,.
 FIGURES IN GERMAN INDUSTRY

Fritz Thyssen
Fritz Thyssen ( 1873-1948) is remembered as the man
who gave more money to Hitler and his Party than any
other individual. That he later broke with the Fuhrer
with dire consequences to himself has received little
publicity. Nor are the reasons for both his fervent ad-
herence to and subsequent apostasy from Nazism gener-
ally known.
An unkind fate made Fritz Thyssen the perennial
cccrown prince"-until his fifty-third year-of the Thyssen
steel empire centered in Miilheim-on-the-Ruhr. His
were all the frustrations and disappointments common
to sons of dominating sires. His father, August, kept
him busy attending advanced technical schools in Bel-
gium, England and Berlin, partly to keep him away
from the business which he himself insisted upon ad-
ministering until the end of his days. He seemed re-
lieved when the son, finding himself superfluous at
home, went on extensive travels to North and South
America, India, the Near and Far East, and the Balkan
countries.
His father, a diminutive, bony, self-made man from
the farm, was a hard-headed, two-fisted entrepreneur to
whom his enterprise was everything and whose intellec-
tual horizon was limited to the boundaries of his indus-
trial empire. He died at the age of eighty-four in 1926.
That same year the greatest German steel combine, the
United Steel Works ( Vereinigte Stahlwerke), became a
fact. The Thyssen interests were the principal compo-
nent in the merger. Fritz Thyssen was chosen chairman
of the board, a position which he held until 1936.
Unlike his father, over whom he always towered
rather absurdly with his six feet height, Fritz Thyssen
was the contemplative type. Although his brains by no
75
 TYCOONS AND TYRANT

means matched his immense body-a faet of which he

was painfully aware-he was given to speculation and
pondering. He was sensitive to matters oJf religious faith
and conviction, and seemed forever to be looking for
causes that he might advance. He was not, however, a
man of superior acumen and penetration.
When the French occupied the Ruhr in 1923, Thys-
sen, unlike many other industrialists, remained at his
post and helped organize the passive resistance. He was
arrested by the occupation authorities, charged with in-
ducing organized labor to resist and to sabotage, and
with disobeying French military orders under martial
law. His defense culminated in the fearless sentence:
"I am a German and I refuse to obey French orders on
German soil." He was acquitted.
It is not surprising that Fritz Thyssen, who came into
contact with the Nazi movement for the first time in
1928 through Rudolf Hess, fell under the spell of Adolf
Hitler. Ardent Catholic that he was, Thyssen had been
deeply impressed with the encyclicals of ]Popes Leo XIII
and Pius XI, in which these pontiffs pleaded for better
social relations. Pius XI advocated a form of government
known as the Corporate State ( Stiindestaat) .11• Hitler
indicated to Thyssen that he favored it, only to renege
later as he did on so many other opportunistic promises.
Thyssen was a fervent nationalist to whom the Treaty
of Versailles was anathema. Hitler's chielf stock-in-trade
was his denunciation of the treaty.
Thyssen felt strongly that the Young Plan for the
regulation of German reparations was a mistake. Hitler
ranted against it in terms of greatest vehemence. "I fi-
nanced the National Socialist Party for a single, definite
reason," Thyssen wrote later. "I financed it because I
11. Cf. Chapter Nine, p. 173.
76
 FIGURES IN GERMAN INDUSTRY

believed that the Young Plan spelled catastrophe for

Germany.'' 12
Thyssen was a convinced monarchist. Hiitler gave him
and many others the definite impression that he would
restore the Kaiserreich.
Thyssen feared communism would overrun the V a-
terland and believed parliamentary democracy was un-
able to prevent its spread. Hitler impressed him with his
insistence that dictatorial measures were necessary to
ban communism.
Thyssen was notoriously a poor speaker. He had diffi-
culty getting his ideas across to others. Hitler was a
spellbinder. This fact fascinated the Miilheim tycoon.
Hitler, in short, seemed to stand for the things in
which Thyssen believed and which the Weimar Repub-
lic in his opinion failed to support. His motives, however
mistaken, were idealistic. And as they were idealistic,
he soon began to doubt, once the Nazis held sway and
failed to live up to his expectations.
His role in helping Hitler in the early stages of his
bid for power was no doubt an exceedingly important
one. At a time when every pfennig counted, Thyssen
gave liberally to the Nazi cause. He was instrumental
in making contacts for Hitler with influential industri-
alists. He was the prime mover in bringing Der Fuhrer
to the Dusseldorf I ndustrieklub, and before this potent
body for the first time openly declared himself a fol-
lower of Adolf Hitler. 1 8 He persuaded Alfred Hugenberg
that the Nazi Party was a movement of the right despite
its radicalism and therefore entitled to al slice of the
funds which Hugenberg received from various sources
12. Fritz Thyssen, I Paid Hitler (London; Hodde:r and Stoughton,
Ltd., 1941. Published in conjunction with Cooperative Publishing
Company, New York), p. 87.
13. Cf. Chapter Four, p. 86.
77
 TYCOONS AND TYRANT

for supporting the election campaigns of the conserva-

tives.
Thyssen definitely had a social conscience. He was
opposed to the elimination of the trade unions as the
rightful representation of the workers as he was to the
persecution of the Jews, and told Hitler so to his face.
In fact, he resigned his honorary office of Prussian State
Counsellor ( Staatsrat), to which Hermann Goring as
Prussian Prime Minister had appointed him, in 1938, in
protest against the treatment accorded Carl Christian
Schmid, Regierungspriisident in Dusseldorf, whom a
mob of Nazis removed forcibly from office merely be-
cause he had a Jewish wife.
Even when he still had faith in Hitler he helped many
German officials financially who were removed by the
Nazis because they had served the Weimar Republic.
Robert Lehr, minister of the interior in the first Aden-
auer government, was among the many who testified in
the Thyssen denazification proceedings of the State of
Hesse that the tycoon had protested vigorously against
his, Lehr's, arrest in 1933 when he was lord mayor of
Dusseldorf. Immediately after Lehr was finally dis-
missed in 1934, Thyssen gave a party in honor of Dr.
and Mrs. Lehr at his home.
As he became progressively more disillusioned about
Nazism, Thyssen demonstratively increased his gifts to
Catholic churches, convents and schools.
His most courageous act-he was a fearless man who
stood up for what he believed in-was that of opposing
Hitler's declaration of war on Poland on September 1,
1939. This final, open break is described later.u The
ardent Nazi had become a penitent sinner.
14. Cf. Chapter Eleven, pp. 230-32.

78
CHAPTER FOUR

Hitler's lndustrieklul)
Speech

S eldom has a platform appearance by a prominent

politician been wrapped in such a maze of fables and
legends as the address given on January !~7, 1932, by
Adolf Hitler in the lndustrieklub of the capital of Rhine-
land-Westphalia, Dusseldorf. This club chiefly com-
prised the leaders of industry of the Ruhr region, but
also included bankers, corporation lawyers:, editors and
publishers, engineers and government officials in the
higher brackets.
Speakers appeared regularly, and a wide range of
subjects, chiefly dealing with economic and cultural
affairs, was covered by them, as they are in any club
which arranges for luncheons or dinners addressed by
invited guests. Party politics, however, was taboo. The
members insisted that the club was not to become a
political debating society.
Hitler's appearance before this group has been con-
sistently represented as though the Industrieklub had
deliberately furnished Hitler the platform for acquiring
respectability with the lords of coal, iron and steel. As
a result of his oratorical triumph-so the legend runs-
truly big money now began to flow in unlinflited quanti-
79
 TYCOONS AND TYRANT

ties. The celebrated letter to President von Hindenburg

some nine months later, signed by Schacht, and alleg-
edly by Krupp, Siemens, and other tycoons, 1 is cited as
one of the many results of this magic performance.
What are the facts in the case?
Sometime late in the autumn of 1931 the officers of
the Industrieklub invited Max Cohen-Reuss, a Social
Democratic Reichstag deputy, as guest speaker. Cohen-
Reuss was then a member of the Reichswirtschaftsrat
(Reich Economic Council), an unofficial advisory body
of the government, and had been a member of the
Workers' and Soldiers' Council during the brief revolu-
tion of 1918. He was expected to discourse on the work
of the Reichswirtschaftsrat, in which all political parties
were represented. Instead, he launched into pure polit-
ical propaganda.
Usually a transcript of the addresses was sent to the
membership. Not so the Cohen-Reuss speech. It was
regarded as having violated the politics-taboo rule.
A number of members, among them Fritz Thyssen,
protested. Thyssen argued that, in order to restore the
equilibrium, some representative of the right must offset
this excursion into a forbidden field by an exponent of
the left. He had a positive suggestion: Nazi Organizer
Gregor Strasser, of whom various industrialists spoke
very highly as holding sane views regarding the German
economic crisis.
Nobody, not even Fritz Thyssen, suggested Hitler.
The executive board of the club, placed in the defen-
sive by Cohen-Reuss' faux pas, agreed to invite Gregor
Strasser to speak on January 27. But this was to be pos-
itively the last political lecture.
Some days later Thyssen went to Berlin on business,
1. Cf. Chapter Two, p. 26.
80
 HITLER ' S INDUSTRIEKLUB SPEECH

where also Adolf Hitler, now a frequent visitor to the

Reich's capital, happened to be. As befits an enthusiastic
neophyte, Thyssen proudly reported to him that he had
managed to secure an opening for Strasser with the
swanky Industrieklub.
CCI'll come there myself and speak in Strasser's place,"
Der Fuhrer ruled.
And that's how it happened that an invitation went
out to all members to hear Adolf Hitler give an address
as a guest of the Dusseldorf Industrieklub.
Much has been made of the fact that the attendance
was larger than usual. This was the first opportunity
many industrialists had for getting a close view, in their
own familiar surroundings, of a man about whom they
had heard so much and who commanded so much space,
overwhelmingly unfavorable, in the newspapers which
they were accustomed to read. There is nothing ex-
traordinary about so many following the call of curiosity.
Busy men of affairs are not the type to run to turbulent
mass meetings. To attend a dinner preceded by an
address, however, might prove both relaxing and stim-
ulating.
The majority of the members had hitherto voted for
the candidates of the Deutsche V olkspartei of the late
Gustav Stresemann which endorsed the government's
policy of fulfillment of international obligations and of
an understanding with the former enemies. If they were
not Stresemann adherents, they belonged to the German
Nationals, the Democrats, the Conservatives, the Eco-
nomic Party, or one of the minor political "splinter"
groups of the right. Some of them were quite active in
the Franco-German Committee ( Comite Franco-Alle-
mand). With the exception of Fritz Thyssen and possi-
bly a few others there were no avowed Nazis among the
81
 TYCOONS AND TYRANT

four or five hundred men who turned out that night of

January 27, 1932.
In order to reconstruct the sequence of events on that
much-quoted evening I have gone to great lengths to
trace, in localities as far apart as Essen and Dusseldorf
in the Ruhr district, Miessbach in the Upper Bavarian
Mountains, Stuttgart in South-German Wiirttemberg,
and Berlin, the relatively small group of men still alive
who were eye witnesses to Hitler's performance. I
prodded them with questions and challenged them with
assertions made by writers who, it turned out, appar-
ently never bothered to ascertain the facts.
Moreover, I read the sworn affidavits of a number of
men of great integrity and high moral principles, offi-
cially cleared as untainted by Nazism, who testified con-
cerning their impressions of the Industrieklub speech for
purposes of the Niirnberg trials, and I perused many
pages of testimony on this point by some of the defend-
ants themselves.
The composite picture thus derived looks as follows:
The audience was not a little surprised and mostly
chagrined when at Hitler's approach bullying voices
were suddenly heard at the entrance to the hall, shout-
ing, ccAlles aufstehen'' ("Everybody get up") . Some, flab-
bergasted, actually rose. Some made the semblance of a
gesture of rising in unwilling conformity. Some remained
seated.
Hitler strode to the rostrum amidst stony silence, fol-
lowed by the chairman of the evening, Fritz Thyssen,
and a score of brown-shirted Nazis who decorated them-
selves behind their Fuhrer as a sort of stage back-drop.
Der Fuhrer wore an ill-fitting cutaway coat and striped
trousers, an attire in which he always somehow looked
incongruous.
82
 HITLER ' S INDUSTRIEKL UB SPEECH

For the first hour of the hundred-and-tw•enty-minute

harangue he droned platitudes and opinions and theories
which failed to evoke a single approving handclap. Their
trend may be gleaned from the following fe\v sentences,
which give the essence of what Hitler, always a mara-
thon talker, served up with many a repetition:
I deem it of prime importance to break oncte and for all
with the view that our destiny is conditioned by world
events . . . . There is nothing that has been brought forth
by the will of man that cannot in turn be altered by another
human will. . . .
It is therefore wrong to say that foreign politics shapes
a people. No, peoples arrange their relations to the world
about them in consonance with their innate forces and ac-
cording to the measure in which their education enables
them to bring those forces into play.
There are . . . two . . . closely related factors which
we can discern time and again in periods of national decline:
one, the substitution of a levelling idea of the supremacy of
mere numbers-democracy-for the conception of the value
of the personality; the other, the negation of the value of
a people, the denial of any difference in the innate capacity,
the achievement, etc., of individual peoples. . . .
Internationalism and democracy are inseparable concep-
tions. It is but logical that democracy, which . . . denies
the special value of the individual and substitutes for it a
value representing the sum of all individualities-a purely
numerical value-must . . . in the life of all peoples . . .
result in internationalism. Broadly speaking it i:s maintained
that peoples have no innate values, but, at the most, it may
be admitted perhaps that there are temporary differences
in education. There is no essential difference in value [it
is held] between Negroes, Aryans, Mongolians, and Red-
skins. . . .
Rule of the people means that a people should allow itself
to be governed and led by its most capable individuals, by
those who are born to the task, and not that an accidental
83
 TYCOONS AND TYRANT

majority which of necessity is alien to these: tasks should be

permitted to administer all spheres of life. Thus [if the latter
view is accepted] democracy will in practice lead to the
destruction of a people's true values. . . ..
To sum up the argument: I see two diametrically opposed
principles: the principle of democracy which, wherever it
is allowed to have practical effect, is the principle of de-
struction; and the principle of the authority of a personality
which I would call the principle of acco:mplishment, be-
cause the achievements of the past-all hutnan civilizations
-are conceivable only if the supremacy of this principle is
admitted ... .
The settlement of the North American continent is . . .
not the consequence of any claim of supexior right in any
democratic or international sense; it was the result of a
consciousness of right rooted solely in the conviction of the
superiority and therefore the right of the white race .. . .
The white race, however, ... can maintain its position
only as long as the difference in the standard of living in
different parts of the world continues to e:xist.
But Hitler, though obviously ill at ease and apparently
nettled, was not thrown off balance by the initial frosti-
ness of his listeners. He was accustomed to penetrate
hostile audiences, even though the proeess might be a
slow one.
The Eher Verlag, official publishing house of the Nazi
movement, undertook to print Hitler's speech in pam-
phlet form when the Industrieklub, deemting the address
to be a political one, failed to send the text to the mem-
bers as was otherwise the custom. There is no reason to
suppose that the Eher Verlag would be sparing in its
insertion of words like CCBeifalt' ("applause") or celeb-
hatter Beifall" ("animated applause") or ~~starker Bei-
falf' ("strong applause") or "Bravo!" It is not until one
reaches page nineteen of this thirty-one page pamphlet
that there is the first mention of ~~Beifall."
84
 HITLER ' S INDUSTRIEKLUB SPEECH

Hitler had been discoursing on his themry that eco-

nomic collapses are always preceded by breakdowns of
the state, and not vice versa; also, that business can
flourish only if a prosperous, mighty state has first been
created. Those who claim that the Versailles Treaty
''according to general opinion" is the source of Ger-
many's misfortune, he said, are wrong.
"No," he cried out, "not 'according to general opin-
ion,' but in the opinion only of those who share the guilt
of concluding it."
It is here he got his first hand. Denouncing the Treaty
of Versailles was popular in those days.
"This Treaty," Hitler continued, "is but the conse-
quence of our slowly progressive spiritual confusion and
aberration of mind." He then developed one of his pet
theories, that of the superiority of the ~Jordic race.
Germany, he declared, owed its rise to the fact that it
was reared by Nordic men. Hence, all that was needed
to restore the Fatherland to political power was "the
regeneration of the German Volkskorper [race]."
This veiled reference to the necessity of removing
non-Nordic elements was again received in silence.
A few minutes later, however, he drew the first "ani-
mated applause" when he denounced communism. Here
are the words which provoked this applause:
It is inconceivable that a strong and healthy c:;ermany can
be created if fifty per cent of its nationals are oriented in
the direction of bolshevism and fifty per cent in the direc-
tion of nationalism! (Very true!) We just can't get around
solving this problem! (Animated applause.)
Hitler had put his best foot forward with this unusual
audience which differed so vastly from the type of mass
meeting in which he reveled. He was car~eful to cast
aside his beer hall agitator's manners and to attempt to
85
 TYCOONS AND TYRANT

sell himself to this powerful group as a man with sane

economic and patriotic ideas. He artfully dodged com-
mitting himself to any specific economtic program. He
merely alluded to racial regeneration ',vithout foaming
at the mouth as he otherwise so often did when he
worked himself up into a passion against the Jews. He
refrained from demanding the abolition of the trade
unions and merely pleaded for harmony between capital
and labor. He pulled at the heartstrings of his hearers
by conjuring up the vision of a Volksgemeinschaft, or
confraternity of all Germans, in which all would be work-
ing for the common good, and for restoring Germany
to its rightful place in the sun.
Everi so, Albert Vogler, director-general of the big
United Steel Works, rose to reply with some critical re-
marks he had prepared. Fritz Thyssen:. by an irony of
fate chairman of the board of the United Steel Works,
refused to recognize Vogler and delivered the thanks of
the audience and of the Industrieklub in terms so laud-
atory of Hitler and his movement that everybody now
knew that he had left the German National Party of
Alfred Hugenberg and joined the Nazils. As if to leave
no possible doubt about it, he tried to end his closing re-
marks with "Heil Hitler," but somehow became tongue-
tied or tongue-twisted, for what the audience heard with
some amusement was, "Heil, Herr Hitl~er.''
The Eher Verlag version of the speech ends with the
words in brackets, cc ( Stiirmischer, langanhaltender Ap-
plaus) ."Most of the men I interrogated denied the final
applause was ccstormy and long-enduring." Some few
asserted it was, indeed, loud and prolonged. Both ver-
sions are credible. Hitler was a spellbinder of rare
ability. His oratorical gifts were unusual. I have often
seen people carried off by Hitler's eloquence-people
who later asked themselves, "What did he actually say?"
86
 ,
HITLER S INDUSTRIEKL UB SPE:ECH

and then discovered that there were many contradic-

tions, inaccuracies and evidences of confused thinking
which they had not noticed while under the ban of an
almost hypnotic influence which he exerted as he spoke.
All whom I questioned, however, agreed that Hitler,s
personal publicity chief, Otto Dietrich, who fairly
drooled at every utterance of his master, was absolutely
wrong when in his dithyrambic description of Hitler,s
climb to power he asserted that one could feel how "the
hearts [of the listeners] began to warm up, their eyes
clung to the lips of the Fuhrer, their faces began to
redden.', 2
Hitler apparently did not detect the reddening faces
and the clinging eyes either, for he stalked out of the
hall without remaining for the dinner ,which other
speakers usually attended as a matter of course. He
preferred to eat alone with Thyssen.
The members as they dined now took the speech
apart and analyzed it with the cool soberness charac-
teristic of hard-headed men of affairs. Some found Hit-
ler,s ideas vague and impractical from a business point
of view. Some thought his strictures on foreign powers
and the government at home contained many good
points. Some said they had been bored. Somle found him
unusually interesting as a personality. But after thus
stripping the speech most listeners were willing merely
to credit Adolf Hitler with unusual forensic talents.
Three liberal, democratic dailies which favored
neither Big Business nor the Nazis, sent reporters to
cover the meeting. The Berliner Tageblatt wrote :
The speech was received with decidedly divided impres-
sions by the listeners. Several prominent industrial leaders,
2. Otto Dietrich, Mit Hitler an die Macht (Munich; Eher Verlag,
1934)' p . 48.
87
 TYCOONS AND TYRANT

especially, expressed grave misgivings about the economic

views and, above all, the opinions regarding the foreign
policy of Hitler.
The V ossische Zeitung, also of Berlin, remarked:
On the whole the reception accorded the arguments of
Hitler was strikingly reserved.
The Kolnische Volkszeitung of Cologne spoke of Hit-
ler as "a pure fool, but dangerous,n and continued:
It would be a case of underestimating [the intelligence
of] the Dusseldorf Industrieklub and the majority of its
industrialist members if one were to speak of Hitler's per-
formance as having made an impression. It is more to the
point to say that the majority were shaken by a feeling of
emptiness.
Far from coming into the Hitler camp with flying
colors as a result of the January 27 speech, the Indust·rie-
klub during the ensuing months had as guest speakers
Karl Gordeler, lord mayor of Leipzig, Johannes Popitz,
Prussian minister of finance, Ulrich von Hassell, German
ambassador to Rome, and Otto Gessler, former Reich
minister of defense. Gordeler, Popitz and Hassell paid
with their lives for sharing in the plot to overthrow
Hitler; Gessler was a victim of continuous Nazi perse-
cution during the ensuing years. The Hitler address had
been nothing more than an incident for the club.
Nevertheless, the mere fact of his appearance before
so distinguished and important a group added to his
prestige. And Thyssen's public avowal of fidelity to the
Nazi chieftain cannot but have made an impression upon
some of his business and financial peers.
Is it true, however, that from then on large contri-
butions from industry flowed into the Nazi till, which
is the real touchstone of Hitler's success? Fritz Thyssen
88
 HITLER ' S INDUSTRIEKL UB SPEECH

seems to have thought so to some extent. In the auto-

biography ascribed to him 8 we find the following sen-
tence:
As a result of the address, which created a deep impres-
sion, a number of larger contributions from heavy-industry
sources flowed into the treasury of the Nazi Party.
I used the phrase, "the autobiography ascribed to"
Fritz Thyssen, designedly. As was brought out in the
Thyssen denazification trial in Hesse, this book was
"ghosted" by the American Emery Reves, who visited
the industrial magnate, then a refugee at Monte Carlo,
during the first half of 1940. A gentleman's agreement
was made that publication of this effort would not take
place except with Thyssen's expressed approval. Accord-
ingly, the first chapters were submitted to and carefully
worked over by the tycoon. Then, when the vicissitudes
of war made contact between author and "ghost" dif-
ficult, Reves went ahead and published the book with-
out showing the majority of the chapters to their "au-
thor" and without his approval.
Thyssen thereupon insisted that the book did not
present his views and attitudes correctly. While interned
at Niirnberg, he had managed to secure a copy of it,
which he marked up carefully. His friend, Jakob W.
Reichert, had an opportunity to examine his marginal
notes. Reichert testified that a question mark had been
placed by the ccauthor" opposite the assertion concerning
the Bow of sizeable contributions by industrialists after
the I ndustrieklub speech.
Not one of the many writers who have asserted that
Hitler's Industrieklub address started big money from
3. Fritz Thyssen, I Paid Hitler (London; Hodder and Stoughton,
Ltd. Published in conjunction with Cooperative Publishing Company,
New York), p. 101.
89
 TYCOONS AND TYRANT

the Ruhr rolling has produced one shred of evidence.

The fact is that the Nazi movement was nearly bankrupt
by the end of the year 1932. Hitler was millions in the
red.'
Hitler, at bay, then had a brilliant iidea which cost
little money and was likely to net him a new prestige:
he decided to concentrate the entire force of his impet-
uous movement upon the tiny state of Lippe, where
Landtag elections were scheduled for January 15, 1933.
He calculated shrewdly that the other parties would not
bother much about so unimportant an area of only a hun-
dred sixty-five thousand population, wilth ninety thou-
sand qualified voters. His easy success, however, he fig-
ured, could be used by his efficient propaganda machine
to put forward the noisy claim that the Nazi Party was
again on the march to success. The psyehological uplift
given the Hitler movement by the Lippe election proved
a decisive offset to his party's staggering debts.
4. Cf. Chapter Five, p. 120.

90
CHAPTER FIVE

German Industry
and Hitler~s Finances

Political contributions by business corporations were a

standard practice in the days of the Weimar Republic.
The idea of subsidizing political parties was started by
Walther Rathenau, the ill-fated Jewish foreign minister
whom forerunners of the Nazis murdered in cold blood
on June 24, 1922. Rathenau as head of the powerful AEG
(Allgemeine Elektrizitiits-Gesellsclwft or General Elec-
tric Company) set the example for his industrialist col-
leagues to support, each according to his predilection,
political parties of every hue and description, even as
far to the left as the Social Democrats, provided they
gave proof of their determination to combat communism.
Just what the size of all these subsidies was will never
be known. Nowhere in the world, it seems, are state-
ments of campaign contributions paragons of honesty.
Subsidies might, for instance, take the form of adver-
tising space taken in a political party organ, for which
a fancy price was paid. It might be in the form of finan-
cial assistance to a party-building project so large that
both the project could become a reality and a handsome
sum left over for lining the campaign chest. In the books
of the donors this gift was entered merely as tax-free
aid to a worthy cause.
91
 TYCOONS AND TYRANT

It so chances that a defendant in one of the three

Niirnberg trials of German industrialists, Friedrich Flick,
was particularly frank and explicit regarding his grants
to political parties. The court which tried him seemed
especially interested in ascertaining to what extent Flick
helped to finance Hitler. The defendant made no bones
about having given money to the Nazis; he was a man
who gave liberally to all sorts of causes. If the right
approach was made to him, he would write out a check
without bothering much as to who was to be the benefi-
ciary. He denied vigorously, however, that the Nazis re-
ceived a greater share of his wealth than did other po-
litical parties. Quite the contrary: he asserted that up
to the last possible moment he contributed especially
heavily to the parties which in his estimation would
prevent Hitler's rise to power.
In proof of this statement he submitted a detailed list
of political subsidies during the critical year of 1932.
His tabulation follows:
For the Hindenburg election (payment in
Berlin) RM 450,000
For the Hindenburg election (payment in
Riesa) RM 500,000
To Briining, November RM 100,000
To Schleicher, July RM 120,000
To Hugenberg, July RM 30,000
To Von Papen, October RM 100,000
To the NSDAP (Nazi Party), estimated RM 50,000
To the Democrats and parties of the left,
estimated RM 100,000
To other parties of the middle, estimated RM 50,000
RM 1,500,000 1
1. On March 13, 1932, the German people had the choice of voting
for a second term for Hindenburg or else for Hitler as the main pres-
idential candidates, the third aspirant being Ernst Thalman, commu-
92
 INDUSTRY AND HITLER ' S FINANCES

Explaining the significance of his political subsidies,

Friedrich Flick presented the following analysis:
The parties of the middle received:
Presidential election (campaign) RM 950,000
Bruning and other middle parties RM 150,000
Schleicher RM 120,000
RM 1,220,000 or 81.8%

The parties of the right received:

Hugenberg RM 30,000
Papen (if one considers him as
belonging to the right) RM 100,000
RM 130,000 or 8.7%

The parties of the left received: RM 100,000 or 6.7%

The NSDAP (probaby too high an

estimate) : RM 50,000 or 2.8%
The trial, incidentally, brought out the fact that Flick
at the time under discussion was a member of Strese-
mann's German People's Party, but never took an active
hand in party work. In a letter to Alfred Hugenberg,
dated July 19, 1932, however, he observed, "Only
through a strong, nationalist, bourgeois group shall we
be able to prevent the NSDAP [Nazi] movement from
sooner or later getting out of hand.,
Throughout the trial one character witness after an-
other, including men now high in the Bonn government,
nist. Hindenburg defeated Hitler, but failed by 0.4 per cent from
obtaining the absolute majority required by the Weimar Constitution.
A second selection had to be held on April 10, and this time Hinden-
burg was sustained by 53 per cent of the voting electorate. Bruning,
Von Schleicher, Hugenberg, and even Von Papen at that time were
considered key figures for at least putting the brakes on Hitler, if
not to bring him to a full stop.
93
 TYCOONS AND TYRANT

testified that Flick was outspoken in his denunciation of

Nazism. And yet, as we see from the tabulation of his
gifts, he diverted a part of his wealth to the Nazi Party
chest.
We may well question the ethics of such conduct. For
the moment, however, we are concerned with the basic
facts of industrial practices regarding the Nazis and
other political parties.
Friedrich Flick was typical, as we have already seen,
of a large number of industrial leaders of the time. That
they contributed to this or that political party or, as
happened more frequently, to various parties, did not
necessarily mean that they endorsed the political creed
of the recipient, or had any abiding interest in the va-
garies of politics.
It is easy to understand, for instance, why certain
breweries helped finance the SPD ( Social Democratic
Party) . Beer was the inexpensive drink of the "little
man.u It would probably have been suicidal to the
brewers to have word passed around among the workers
that they refused to help the party of the toilers!
It is equally easy to understand why the heads of huge
iron and coal concerns, in which many thousands of
workers had already embraced the Nazi faith, thought
it smart business to make a gesture to the brown-shirted
collectors for the Hitler treasure chest.
We are here dealing with human weakness, or selfish-
ness, or both, and with lack of principle, but not with
a political act of identification with this or that move-
ment or party. ccWir wollten unsere Ruh' haben'' (mean-
ing: "We didn't want to be bothered" or "We wanted
to be able to attend to our jobs without being dis-
turbed") was a stock explanation given by many indus-
trial leaders for their political subsidies. They regarded
94
 INDUSTRY AND HITLER ' S FINANCES

the National Socialists as a bona fide political party

rather than a revolutionary movement of portentous
potentialities.
Given these contribution practices, how did the Nazis
profit from them? What industrialists SU]pported them
financially?
The name which immediately comes to mind first is
that of Fritz Thyssen. There seems to be no doubt that
he gave Hitler more money at a time when it counted
most than any other individual. Emery B~eves has him
say in I Paid Hitler that he gave one 11nillion marks.
Thyssen on reading the Reves-ghosted book, placed a
question-mark alongside this assertion, 2 and in a letter
dated February 28, 1948, and addressed to the Hesse
Denazification Court expressly denied giving so large a
sum. He did, however, make the following admissions
during his denazification trial:
He was the first and for quite some time the only steel
industrialist who came under the spell of: Adolf Hitler
and supported his movement financially. A.s early as Oc-
tober 1923, during a visit to the home of IGeneral Erich
Ludendorff, he gave one hundred thousand gold marks
(about $23,810) to the general to distribute between
the Nazi movement and the Freikorps Oberland, an ag-
gressive Bavarian paramilitary organization.
About five years later the Nazis, who had not heard
from him again, sought contact with him through Rudolf
Hess. They had meanwhile contracted to buy their
Brown House, the rather palatial headquarters building
for the movement at Munich, and were hoping Thyssen
"would pick up the tab." This he declined to do, but on
his responsibility a Dutch bank loaned the money for
2. Cf. Chapter Four, p. 89.
95
 TYCOONS AND TYRANT

the purchase. When the Nazis failed to meet their ob-

ligations in this deal, Thyssen quietly paid the bal-
ance due the Dutch bani<. It amounted to RM 150,000
( $35,715).
About this time-1930 or 1931-Thyssen struck up a
friendship with Hermann Goring, who seems to have
"touched,, him successfully both for the party and for
his personal financial needs, such as the rent for a
swanky apartment. Testimony during the trial indicated
that three donations of RM 50,000 each ( $35,715 alto-
gether) were made to Goring.
A subsidy of RM 100,000 ( $23,810) to Editor Walther
Funk was contributed beginning in 1932 in the hope
that this financial writer's relatively conservative Na-
tiona! Socialist W irtschaftszeitung (Economic News)
might have a decisive influence upon party economic
policies and counteract the wild ideas of men of the
Gottfried Feder and Otto Wagener type.
This contribution had a previous history: one day in
1932 Funk turned up in Dusseldorf to beg for RM
100,000. Thyssen, momentarily short of cash, requested
Ludwig Grauert, executive director of the Northwest
German Employers' Federation, to make this sum avail-
able to Funk-a request to which Grauert acceded after
telephoning the vice-president of the Federation. When
this action was reported to the full board, it was sharply
disavowed. Grauert was reprimanded and threatened
with dismissal, which was averted, however, when Thys-
sen agreed to repay the sum in full. A resolution was
passed that no political contributions must henceforth
be made from the funds of the Federation.
Thyssen in his marked copy of I Paid Hitler placed
no question-mark behind an assertion ascribed to him,
according to which Hitler in the early days of his move-
96
 ,
INDUSTRY AND HITLER S FINANCES

ment "obtained the help of several industrialists, par-

ticularly that of Herr Minoux of the Stinnes firm.'' 8
Inasmuch as the name of Minoux has apparently fig-
ured nowhere in the many affidavits, interrogations, and
writings dealing with later periods of IIitler's career,
Thyssen was right in identifying the forrner Stinnes di-
rector only with the beginning of the Nazi movement.
He also corroborated that Hitler's early financial "angels"
included Carl Bechstein of Berlin and l(ommerzienrat
Hugo Brockmann of Munich.'
Thyssen failed to mention Albert Pietsch, the head
and principal owner of the Elektroche1nische W erke
Miinchen A.G. of Hollriegelskreuth near Munich, who
was one of Hitler's very earliest backers. In fact, Pietsch
gave Hitler his first thousand marks when he emerged
from Landsberg prison in December 1924: after his un-
successful Munich Beer Cellar putsch of November
1923. Pietsch was attracted, as he told recent visitors,
by Hitler's fascinating oratory and his uncompromising
attitude toward socialism and communism. From time to
time he gave Hitler a financial lift. Altogether his sub-
sidies did not compare even faintly with those of Thys-
sen, but to a man who left prison virtually penniless this
financial encouragement must have seem~ed impressive.
In the absence of any evidence to th4e contrary we
must conclude that there was only one other leader be-
sides Thyssen in the heavy industries' group who em-
braced the Hitler faith at an early date. He was Emil
Kirdorf, founder and executive director of the Rhenish-
3. Friedrich Minoux, a banker and later wholesatle dealer in coal,
for a number of years in the twenties was director-general of the
Stinnes Concern, and was picked by Ludendorff as possible head of
a "directorate" which was to take the place of the: Weimar govern-
ment. Minoux would have no part of this. By October 1923 he had
also severed his connection with Stinnes.
4. Cf. Chapter Two, p. 18.
97
 TYCOONS AND TYRANT

Westphalian Coal Syndicate, and a friend of Walther

Funk. Kirdorf had no use for the Weimar Republic, was
a Wotan worshiper and a pugnacious individual-just
the sort of person to whom Hitler's aggressiveness and
hostility to the established churches and to the Weimar
Republic might well appeal. A Nazi enthusiast since
1923, he met Hitler for the first time in 1927.
Kirdorf at the time under discussion, however, was
an octogenarian whose influence was no longer great,
so that his relation to Nazism did not carry nearly as
much weight as did that of Thyssen. Besides, he was not
a rich man as millionaires go-merely the recipient of a
handsome salary. His effort in 1930 to win Ruhr indus-
trialists over to the Nazi cause by inviting some twenty
of them to hear a four-and-a-half-hour harangue by
Hitler at his home, the Streithof, proved a Hat failure.
The arguments of Der Fuhrer were mercilessly picked
to pieces by his listeners, especially Ernst Poensgen.
One legend regarding Kirdorf still persists. It is to
the effect that Kirdorf was instrumental in persuading
the powerful Rhenish-Westphalian Coal Syndicate
( RWKS) in 1931 to set aside fifty pfennigs (about
twelve cents) per ton of coal sold, as a continuing sub-
sidy to the Nazi Party. If true, this would have meant a
steady annual income of RM 60,000,000 (about $14,-
285,700) for the Nazis.
After rumors of this alleged deal had circulated for
years, the charge against the RWKS was given serious
attention in July 1947, when Hugo Stinnes Jr. faced a
denazification court. Some two hundred members of the
Works Council of the Stinnes Concern alleged that their
employer had voted in favor of the Kirdorf proposal as
a member of the directorate of the RWKS.
Stinnes replied categorically that the RWKS had not
98
 INDUSTRY AND HITLER ' S FINANCES

contributed one pfennig to the Nazi movement or to

Hitler before his seizure of power in 1933.
To Stinnes' aid came Albert Janus of Essen-Relling-
hausen, who from 1893 until the liquidation of the
RWKS by the British Military Government in Septem-
ber 1945 had served successively as a member of the
management board, as director-general, and as a mem-
ber of the board of directors. Janus issued a statement to
the press, pointing to his long service in the RWKS and
his intimate knowledge of its operations, and branding
the charge about the fifty pfennigs as cccompletely un-
tru e."
To this the cynic may reply, ccNaturally Stinnes and
Janus would issue denials; what else did you expect?''
Stinnes and Janus, however, drew support from an
unexpected quarter: the Works Council of the North
German Coal Distributing Office (the Military-Govern-
ment-controlled successor to the RWKS) felt that the
unwarranted charge cast a reflection upon the Works
Council members of the RWKS, composed of represen-
tatives of the miners. As these members had had access
to the books of the syndicate, they would have been
derelict in their duties if they had either failed to de-
tect that sixty million marks per year were flowing into
Hitler's coffers, or if, having discovered this huge diver-
sion of funds, they had not objected. The following state-
ment was therefore released to the press on August 5,
1947:
The workers and employees of the Rhenish-Westphalian
Coal Syndicate, which was dissolved on October 1, 1945,
were with certain exceptions taken over into the North Ger-
man Coal Distribution Office. In order not to endanger the
good reputation of NGCDO, the Works Council feels im-
pelled to issue the following declaration:
99
 TYCOONS AND TYRANT

Affidavits were taken from those workers and employees

who without interruption served the RWKS and the present
NGCDO from times before National Socialism until today,
and who either had unhampered access to the books or on
orders from the then Board of Directors of the RWKS car-
ried through the collection and calculation of assessments.
It is [herewith] established that the rumors recurring again
and again in the press about a special assessment by the
RWKS in favor of the Nazi Party are without any founda-
tion whatsoever.
(Signed)
THE WoRKs CoUNCIL oF THE NGCDO
One would have thought that this testimony by the
representatives of the workers themselves, among whom
were two communists, would bury the canard once and
for all. But such was not the case.
The Berlin communist paper, Neues Deutschland
("New Germany'' ), on August 8, 1947, claimed now that
the assessment in Hitler's favor was five and not fifty
pfennigs, and that it was arrived at in the course of a
secret directors' meeting. It became a matter of public
knowledge, however-so the new version ran-through
the accident that the State of Prussia owned some of the
coal mines and therefore was compelled to meet its quota
of the assessment. This situation, the newspaper averred,
had at the time given rise to debate in the Prussian
parliament.
Again Dr. Janus categorically denied that any Coal
Syndicate money whatsoever or on whatever basis had
been given Hitler or his movement before the Nazi sei-
zure of power. The two chairmen of the board of RWKS
who succeeded each other between 1935 and the dis-
solution of the syndicate, Hermann Kellermann and
Herbert Kauert, as well as the vice-chairman through-
out this period, Willi Huber, and six members of the
100
 :J
INDUSTRY AND HITLER S FINANCES

board and two deparbnental experts also solemnly af-

firmed that all stories of alleged Coal Syndicate subsidies
to Hitler before 1933 were completely unfounded.
Dr. Janus challenged Neues Deutschland to produce
even a shred of evidence for its allegation. He demanded
to know in what session of the Prussian Landtag the
alleged debate had taken place. The newspaper never
replied.
On the face of things the charge looks silly. For, the
State of Prussia throughout almost the entire life of the
Weimar Republic was a Social Democratic stronghold.
In the struggle between the parties of the right and the
left, no better political boon could have come to the
Social Democrats in the Prussian government than to
discover an attempt by the ''capitalist;,;, directorate of
the RWKS to divert money earned by the various coal
operators, including the State of Prussia, to Hitler by
way of a fifty or five pfennig assessment. Strange that
only in 1947, fifteen years later, the communists should
discover this brazen-faced steal of Prussian state funds!
Although the sixty million assessment has been proven
a myth, this does not mean that no support was given
Hitler before 1933 from the mine operators other than
Thyssen and Kirdorf. According to August Heinrichs-
hauer, one of the best known public relations men of
German heavy industry, a steady monthly subsidy of
altogether RM 10,000 ( $2,381) was entrusted to Gregor
Strasser for the use of the Nazi Party. The money did
not come out of the general treasury of the RWKS, but
individual mining concerns or individual operators dug
into their pockets to raise this sum. I have not been able
to identify these sources.
As Heinrichsbauer explained: 15
5. A. Heinrichsbauer, Schwerindustrie und Politik (Essen-Kett-
wig; West Verlag, 1948), pp. 39, 40.
101
 TYCOONS AND TYRANT

In making these payments the mining industry reasoned

that contact must be established and maintained continu-
ously with the [Nazi] Party, and that this could be best done
by steady subsidies. It was believed that fthe Party could
count on a considerable increase in membership because
of the deepening economic crisis, as a result of communist
propaganda for a civil war, and in view oif the ever more
evident failure of the parliament, the government, etc.; it
would be dangerous to leave a party that haLd so many dep-
uties who were trained only in propaganda and not in con-
structive work and responsibility, to its OV'm designs. . . .
There were no political scruples against taking that sort
of an interest, inasmuch as relations (including financial)
were maintained with other parties also, and as the avowed
program of the NSDAP (job creation, community spirit,
premium placed upon efficient pedormance, peaceful revi-
sion of the Versailles Treaty, etc.) seemed to be one to
which everybody could subscribe.
It was considered opportune, however, not to place the
subsidies in the hands of the party executives, as there could
then be no check-up on the uses to which they were put,
but rather someone should be selected in whose political
common sense and honest administration of funds one could
have confidence and with whom one might, if necessary,
have a word. Gregor Strasser, Reich organizer for the Nazi
Party, who enjoyed a splendid reputation in the region,
seemed the proper person. . . .
Accordingly, beginning in the spring of 1931 a monthly
sum of RM 10,000 ( $2,381) was placed att Strasser's dis-
posal. The chief argument for this form of subsidy was the
desirability of consciously strengthening the hands of per-
sons and offices within the Party whose views were in con-
tradiction to those of men like Gobbels and Goring. . . .
After it had become evident that there was practically no
possibility of limiting the influence of Nazism from the out-
side, there remained no other course save that of continuing
the effort to contain the movement within proper bounds
by influencing it from within.
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 INDUSTRY AND HITLER ' S FINANCES

Heinrichsbauer then pointed out that the mine oper-

ators saw in the Nazi movement a powerful counter-
weight to communism, which during the ]period of de-
pression constituted "an acute danger." Als:o, in Strasser
they believed to have picked the man who would be
ready to work in co-operation with other parties. The
coal industry, he insisted, never wanted one single party
to govern dictatorially.
We have already spoken of Funk and his: W irtschafts-
zeitung, which Thyssen financed beginning in 1932.
About a year earlier he had started a politico-economic
news service. To this undertaking, accordling to Hein-
richsbauer, a group of mine operators con1tributed $500
to $750 monthly.
Hitler's request to help buy the RM 300,000 Brown
House and to establish a Nazi training school was turned
down cold by them.
For the 1931 Reichstag election, Heinrichsbauer re-
calls, Hitler was given RM 100,000 ( $23,810) by coal
industrialists, but this amount was considerably lower,
he insists, than what was given to other ]parties of the
right. Since Strasser's influence from then on was wan-
ing, no money was given the Nazis by the:se sources for
the 1932 election.
Some money, according to Heinrichsbauer, flowed
into the Essen Natio1Ullzeitung and into the local Nazi
headquarters of Essen. This money was contributed by
local coal operators and did not exceed ~11,700 for the
years 1931--32. Heinrichsbauer concludes:
The moneys from coal industry sources about which I
have knowledge for the years 1930 to 1932 Vlrere not essen-
tially in excess of-1 estimate-a total of RM ~)()0,000 (about
$120,000) to RM 600,000 ( $144,000). This includes the pay-
ments made to Strasser and Funk.
103
 TYCOONS AND TYRANT

Independently of these payments, funds were diverted

in 1931 or 1932 to my knowledge two or three times for
[Nazi] Party purposes. These stemmed fron1 the Northwest
Employers~ Federation (without the approval, however, of
the president, Ernst Poensgen), and totalled RM 200,000 to
RM 300,000, of which RM 100,000 constitut~ed a loan to the
Nationalzeitung and another amount a subsidy for the 1931
election.
The sum total of coal industry subsidies to the Nazi
movement can only have been a minor item for a mass
movement such as the Nazi Party was when industry
began to take it seriously. In Germany, no less than in
the United States, election campaigns were a costly
matter. Ludwig Grauert, Reichstag candidate for the
V olkskonservative Party, testified, for instance, that his
bid for a seat in the Reich's highest legislative body cost
RM 380,000, or about $90,000. The N'azi Party also
needed huge sums for purposes beyond the financing
of election campaigns. The uniformed Brown (SA) and
Black ( SS ) Shirts, for instance, had to be maintained.
Legal fees for the many trials in which Nazis became
involved had to be raised.

The steel industry as such-i.e., the organization rep-

resenting its interests-did not divert naoney from its
financial chest to Nazism. Thyssen and, to a minor ex-
tent, Kirdorf did. Ernst Poensgen, former president of
the Federation of German Iron and Steel Industrialists,
a proven opponent of Nazism, has stated that with the
exception of the RM 100,000 which were demanded of
Grauert by Thyssen,6 no contributions were made to
Hitler or his movement by the steel industry.7
6. Cf. Chapter Five, p. 96.
7. Ernst Poensgen, Hitler und die RuhrindustrieUen: Ein Ruckblick.
An eighteen-page expose for private circulation.
104
 INDUSTRY AND HITLER ' S FIN AlNCES

As a little side-light on the attitude of tl~e big lords

of steel it may be noted that no picture of Hitler ever
was displayed in the auditorium of the Stahlhof, the
national headquarters of the steel federation in Dussel-
dorf. After Hitler became the master of Germany, the
demand to display his likeness in the hall ]in which all
membership meetings of the federation were held, be-
came increasingly strong. The executive board under
the leadership of Poensgen artfully side-stepped the
issue by remodeling the auditorium with wood paneling
on which neither a painting nor an engraving would
have looked good.
It is also an interesting fact that Max Schlenker, the
Geschiiftsfuhrer (executive director) of the North-West
Group of the Federation of German Iron and Steel In-
dustrialists, was forced out of his position immediately
after the Nazis took over in 1933, on the ~~rounds that
he was "unbearable for the Party."'

One unusual group of persons, chiefly from industry,

which gave money to certain Nazi undertakings, was
that known variously as Freundes-Kreis (Circle of
Friends), Keppler-Kreis or Rimmler-Kreis. Its origin
and purpose follows:
In 1932 Wilhelm Karl Keppler, originally a small in-
dustrialist, was appointed by Hitler as his economic
adviser. Hitler felt that, as the time approached when
he might come into his own as chancellor, he should
know at least something about economics. According
to Keppler's own sworn testimony Hjalmar Schacht per-
sistently offered to become the Nazi Party's economic
expert, but Hitler somehow did not click suffiiciently with
him (although he later used him in many ways) to bring
him into so close a relationship with himself. Instead,
Keppler was chosen.
105
 TYCOONS AND TYRANT

Keppler stated during. the hearings in Niirnberg that

he, too, still had lots to learn about business, finance
and industry. So he asked twelve people to form a little
Circle of Friends from the Economy ( Freundes-Kreis der
W irtschaft) for the purpose of discussing economic af-
fairs informally, without definite programs and with no
minutes taken. On Hitler's authority he explained that
these Friends were to discuss and advise him (Keppler)
on two things: how to solve the problem of unemploy-
ment and how to get business and industry going again.
The original twelve of the Circle of Friends comprised
Hjalmar Schacht, Baron Kurt von Schroder, the Cologne
banker, August Rosterg, potash magnate, Count Gott-
fried von Bismarck, agricultural expert and grandson of
the Iron Chancellor, Otto Steinbrink, of the Flick con-
cern, Albert Vogler, of United Steel, Attorney Heinrich
Schmidt, representing a number of Hanover industrial
firms, Ewald Hecker, of Ilseder Hiitte (steel concern),
Rudolf Bingel, of Siemens & Halske, Emil HelHerich, of
the Hamburg-America Line, Emil Meyer, of the Dres-
dener Bank, and Friedrich Reinhardt, of the Commerz-
und Privatbank.
These twelve men on May 18, 1932, came to the Hotel
Kaiserhof, Berlin, to meet Hitler, who gave one of his
usual monologues fitted to the particular audience he
was addressing. About once a month these men met at
dinner around a big table and later sat for coffee and
liqueurs at small tables to discuss questions of mutual
interest. At that time no collections were taken. Keppler
emphasized throughout that he was anxious to learn the
viewpoints of the Circle of Friends, which he would,
as occasion presented itself, communicate to Hitler.
Der Fuhrer, who met with them only once, gave
orders that the Friends were to be invited regularly to
the big party conventions in Niirnberg and to the me-
106
 ,
INDUSTRY AND HITLER S FINANCES

morial exercises for the "martyrs" of the abortive Nazi

putsch of 1923 on November 9 of each year. Since he
reserved his own personal invitations only for the chosen
few, he had these bids issued in the name of the chief
of the SS, Heinrich Rimmler.
One of Rimmler~s first acts upon becoming acquainted
with the Circle of Friends was that of inviting them to
visit the concentration camp at Dachau. That is, they
were naturally not shown the gruesome aspects of it.
They were taken through the pottery and chinaware
factory which Rimmler had established, and in which
the more favored camp inmates worked under relatively
good conditions. Rimmler thus wanted to impress the
Friends with the fact that conditions were not as bad
as the hostile press pictured them to be. "I am not a
terrorist," he told the visitors.
Keppler and Rimmler's adjutant, Fritz Kranefuss, en-
countered one difficulty at the Niirnberg rallies: they
would regularly set aside special chairs for the Circle
of Friends, only to find that nobody paid attention to
these "reserved'' signs. Kranefuss then hit upon the sav-
ing idea of marking the section "Circle of Friends of
SS-leader Rimmler." That worked. But from there on,
according to Keppler, the name "Circle of Friends of
Rimmler" also stuck and the group became known as
such.
Rimmler appeared only on rare occasions, but then,
according to Franz Hayler, one of the later members,
"showed his second face," which was that of a harmless,
interested citizen who was anxious to learn what troubles
and worries the Friends had. 8 Though the Circle was
increased gradually by Keppler, it appears never to have
8. Franz Hayler was in charge of German retail trade after com-
merce and industry in February 1934 were divided into Reich groups.
Cf. Chapter Eight, p . 168, and Chapter Twelve, p. 239.
107
 TYCOONS AND TYRANT

exceeded thirty-six. Many men from Germany's eco-

nomic life, he claimed, tried to crash the gates, but he
and with him later Kranefuss invited only such men as
they deemed "worthy" of the honor.
Some members testified later that they joined in the
hope of learning some things they could not find out in
any other way. They were disappointed. The regime
pumped them but revealed no secrets its~elf. Some joined,
when invited, as a sort of personal insurance, just as
firms in the United States will sometimes pay bribes to
rotten city administrations for their protection. Some
hoped to exert a modicum of economic: influence.
Among prominent men in the German economy who
in the later years were invited and accepted were Fried-
rich Flick, Heinrich Biitefisch, of IG Farben, Hans Walz,
of the Robert Bosch Company, Karl Lindemann, of the
North German Lloyd, Kurt Schmitt, of the Allianz Insur-
ance Concern, Ritter von Halt, of the Deutsche Bank,
Hellmuth Rohnert, of Rheinmetall-Borsig, and Karl
Blessing, representing German-Russian oil interests.
The members of the Circle of Friends were naturally
flattered to have ring-side seats, as it \Vere, during the
week's festivities, parades, pageants, and demonstrations
that followed each other with dizzying rapidity at Niirn-
berg each September. They felt they must do something
to show their appreciation. They therefore made in-
quiries as to Rimmler's pet projects and! learned that he
was organizing an expedition to Tibet, that he was reviv-
ing a Germanic cult at the shrine of Emperor Heinrich I
in the cathedral at Quedlinburg, and that he was de-
voted to archaeological studies.
They decided, therefore, after Himmller had become
minister of the interior in addition to being head of the
SS, to offer him a purse for advancing; his hobbies. It
108
r'-
 ~

INDUSTRY AND HITLER S FINANCES

amounted to one million marks annually for 1941, 1942

and 1943.
Keppler vigorously denied, however, that any money
considerations entered into the selection of the original
twelve who constituted the Freundes-Kreis der Wirt-
schaft before Hitler~s accession to power and the first
years thereafter.

Of individual coal, iron and steel tycoons who for

various reasons appear to have supported Hitler before
he became chancellor I have also in my researches run
across the following names so frequently and from so
many different sources that one cannot escape the con-
clusion that these men at various times opened their
purse strings for the Nazis before Hitler~s accession to
power: Herbert Kauert, son-in-law of Emil Kirdorf,
Ernst Tengelmann, manager of the Essen Steinkohlen
A. G. (Essen Bituminous Coal Co., Ltd. ) and his sons,
Walter and Wilhelm, Otto Steinbrink, plenipotentiary
representative of the Friedrich Flick Company in Berlin,
and Otto Wolff, the Cologne industrialist. One much-
mentioned steel king, Hermann Roehling of the Saar
Valley, did not support the Nazis substantially until
1935. Concerning Albert Vogler, president of the V erein
deutscher Eisenhuttenleute (Association of Iron Works
Owners) opinion varies. Some believe he helped Hitler
financially before 1933; some only after his accession to
power. His attitude during Hitler's Industrieklub speech
makes financial support before 1933 seem dubious.9
That about exhausts the list. But considering the great
number of leaders of Germany~s big business, is it fair
to say THE German industry supported the Nazis deci-
sively and thereby helped to put him over? This group
9. Cf. Chapter Four, p. 86.
109
 TYCOONS AND TYRANT

can easily be offset by the equally important names of

Krupp von Bohlen, Paul Reusch and son ]Hermann, Peter
Klockner, Ernst Poensgen, Heinrich Bierwes, director-
general of Mannesmann, and Ludwig Kastl, none of
whom helped place Hitler in power. In industry, as
everywhere else, the situation cannot be described in
the simple terms of black and white; there were many
shades in between.
Very little authentic information, for instance, is avail-
able concerning the thousands of little industrial con-
cerns that flourished in Germany. Their importance to-
day is seen from the fact that in the present Federal
German Republic roughly one-half of the industrial
workers are employed in small-sized individual plants
and factories and only the other half in the heavy in-
dustries centering in Westphalia and the Rhineland. The
Western Allied governments were apparently so deter-
mined about breaking up the large German coal, iron,
steel, and chemical combines, and to prove that their
leaders were criminals, that little attention was paid to
the smaller concerns.
To what extent the "little fellows:>) p:aid money into
Nazi coffers will in all likelihood never become known.
Nor has the story been authentically tolld as to the ex-
tent of foreign aid given the moveme](lt. In an open
letter published in Rudolf Pechel's monthly magazine,
Deutsche Rundschau, in July 1947 For:mer Chancellor
Heinrich Bruning made the following statement:
One of the chief factors which determined the rise of
Hitler ... was the fact that he received large sums of
money from abroad in 1923 and later.
It is generally believed that Sir Henry Deterding, the
Dutch oil king, who owned an estate in Mecklenburg
and supported all anticommunist mov~ements, helped
110
 INDUSTRY AND HITLER ' S FINANCES

Hitler in a big way. It is alleged he gave as much as

ten million marks in the course of the years. I have been
unable to find concrete evidence to prove this point.10
While I was AP correspondent in Berlin it was further
rumored that Lord Rothermere helped Hitler's foreign
press chief, Ernst F. S. ( "Putzi'') Hanfstaengl, finan-
cially, apparently to build up his public relations section.
But here, again, proof is lacking.
Dr. Bruning declined to elaborate on his 1947 state-
ment, as he does not desire at this stage of international
negotiations to introduce a further controversial element.
It is known, however, that he expects within another
year to finish his memoirs. His revelations concerning
the sources of Hitler's income before 1933, on which he
as the then chief of the German government can speak
more authoritatively perhaps than any other living be-
ing, may well prove sensational For, in addition to mak-
ing the charge of foreign aid to Hitler, he also said in
his Open Letter:
The financing of the Nazi Party, partly by persons of
whom one would least have expected that they would sup-
port it, is a chapter in itself. I have never spoken publicly
about it, but in the interests of Germany it may become
necessary to do so.
Certain bankers, especially, according to Bruning,
helped Hitler. Referring to a group of influential people
who wanted Hindenburg to include the Hitlerites in the
government in 1932, Bruning wrote:
This latter group included a number of bankers who ex-
erted a special influence upon the president. . . . At least
one of them, it was known, had since October 1928 lavishly
10. Walter Gorlitz and Herbert A. Quint in their Adolf Hitler-
eine Biographie (Stuttgart, Steingriiben Verlag, 1952), p. 279, merely
rder to Deterding as one of a number of financial backers.
111
 TYCOONS AND TYRANT

supported the treasuries of the Nazis and the Nationalist

Parties with money. He died shortly after the Nazis came
into power. . . . These same bankers in the autumn of 1930
tried to influence Ambassador Sackett 11 against my govern-
ment and in favor of the Nazi Party.
Walther Funk, Hitler's last minister of economics and
Reichsbank president, in the course of an interrogation
while awaiting trial identified the following bankers as
having been close to the Nazi Party:
Baron Kurt von Schroder, co-owner of the I.H. Stein
Bank of Cologne, former general staff officer, member
of the H errenklu.b and a friend of Franz von Papen;
Heinrich von Stein, principal owner of the I. H. Stein
Bank;
Otto Christian Fischer, of the Reichskredit-Gesell-
schaft;
Friedrich Reinhardt, of the Commerzbank; and
Emil Georg von Stauss, of the Deutsche Bank.
The role of Reichsbank President Hjalmar Schacht has
already been explained. 12

The situation within the chemical industry was an in-

teresting one: We have already learned of the opposi-
tion of Carl Duisberg and Carl Bosch to Nazism.u Even
under these two men, however, there were some devo-
tees on the board of directors of IG Farben who es-
poused the Nazi cause. There is no proof, however, that
they prevailed upon their colleagues to lend financial
support before 1933.
11. Frederick M. Sackett, former Republican Senator from Ken-
tucky, was President Herbert Hoover's ambassador to Germany 1929
to 1933. He died in 1941.
12. Cf. Chapter Two, p. 21.
13. Cf. Chapter Three, pp. 42 and 45.
112
 INDUSTRY AND HITLER ' S FINANCES

Whatever IG Farben's role was after 1933, it seems

certain from the records which I have examined that this
concern did not help finance Hitler before his accession
to power. The source through which political contribu-
tions were made by this trust in the late twenties and
early thirties was W. F. Kalle, head of Kalle & Co. of
Wiesbaden, a subsidiary of IG Farben. Kalle was a dep-
uty both in the Reichstag and the Prussian Landtag, and
a leading member of the managing board (Vorstand)
of the German People's Party. The annual subsidies to
political parties by IG Farben through Kalle were:
Approximate
RM
To the German People's Party 200,000
To the German Democratic Party 30,000
To the German Centrist Party 50,000
To Member organizations, German People's
Party 200,000
To Member organizations, German Democratic
Party 50,000
To Member organizations, German Centrist
Party 70,000
For the Hindenburg Election 1932 1,000,000
IG Farben always prided itself on the fact that none
of its officers or directors attended the famous Dussel-
dorf Industrieklub meeting.
Konrad Heiden has claimed that Hind enburg's elec-
tion campaign was paid for chiefly by "the banks, the
big industrialists, and Geheimrat Duisberg of the IG"
and gave as his deliberate opinion that "the three big
industrialists, by the way, who can boast of the most
solid and powerful accomplishments of the postwar [i.e.
World War I] era, Carl Duisberg and Carl Bosch of the
IG and Carl Friedrich von Siemens, the head of the
113
 TYCOONS AND TYRANT

combine with the same name, did not support Hitler,

but rather opposed him., 14
During the years when Hitler was gathering more and
more followers under his banner, IG Farben enabled the
liberal Frankfurter Zeitung to continue by covering its
sizable deficit, thereby enabling it to sustain its liberal
tendencies even under Hitler-at least for a while. With-
out attempting in any way to influence this famed daily,
the IG directors considered it essential that a newspaper
with such outspoken democratic tendencies and with
such importance to the business and industrial world
should continue. The Farben Concern later also sup-
ported the Frankfurter N achrichten. 15
After the Nazis came into power, of course, IG Farben
like all other German industrial concerns was compelled
to contribute to Nazi causes.

Another important German industry was that of elec-

tric machinery. The names of Ernst von Borsig, of the
Borsig machines and locomotives works, Carl Friedrich
von Siemens, of the Siemens Concern, makers of electric
goods, Hermann Bucher, of the General Electric Com-
pany ( AEG), all of them of Berlin, and Robert Bosch
of sparkplug fame, Stuttgart, naturally loom large. Of
these, none joined the Hitler camp; all of them were
determined opponents. The large Bavarian concern,
M.A.N. (Maschinenfabrik Augsburg-Niirnberg), manu-
facturers especially of propulsive machinery for sea-
going vessels, also remained outside the Nazi orbit and
did not contribute to Hitler's cause. Its head, Otto
Meyer, was an uncompromising anti-Nazi.
14. Konrad Heiden, Adolf Hitler; Das Zeitalter der Verantwort-
ungslosigkeit: A Biography (Zurich; Europa Verlag, 1936), pp. 286
and 312.
15. Chapter Eleven, p. 223.
114
 ,
INDUSTRY AND HITLER S FINANCES

A number of writers who have tried to look into Hit-

ler's finances have asserted that German industrialists
resumed their alleged contributions to the Nazi Party,
withdrawn after Hitler's failure in the November 1932
elections, as a result of the mysterious meeting between
Adolf Hitler and ex-Chancellor von Papen at the home
of Banker von Schroder in Cologne. This meeting took
place on January 4, 1933, during the brief chancellorship
of General Kurt von Schleicher. Not one of these writers
has furnished any proof for his contention. We must
therefore leave this question open.
I am not ruling out a possibility that industrial aid to
Hitler during January 1933 may have been resumed; I
am merely unwilling to accept it on mere hearsay. I am
equally unwilling to accept the contrary view merely
because Baron von Schroder told the tribunal of the
Niirnberg court which tried Friedrich Flick that not a
word was said during the January 4 meeting about the
financial position of the Nazi Party nor about financial
aid to the party by heavy industry. 16
In any case, in that month of January 1933 political
considerations were paramount. Far more important
than finances was the alliance struck up between Hitler
and Papen, with Papen undertaking the delicate task of
bringing senile President von Hindenburg around to
acceptance of Hthe Bohemian corporal." Hitler was jus-
tified in calculating that, once der Alte (the Old Man)
was won over, his financial worries were at an end.
Summing up: some industrialists did contribute-
some of them heavily-to the Hitler cause during his
ascendancy. Was this financial support decisive for Der
Fiihrer"s success in reaching the goal of his ambitions,
16. Cf. Chapter Seven, p . 138.
115
 TYCOONS AND TYRANT

as the cliche would have it? Might he have attained his

ends without the support of these circles?
This whole question might very well have been an-
swered beyond the peradventure of doubt had the
innumerable searches of Nazi headquarters, Nazi safes,
Nazi hide-outs yielded one of the most important finds
of all: the accounts of the national treasurer of the
NSDAP, Franz Xaver Schwarz. In his office were assem-
bled all the data concerning the sources of the Nazi
Party's income. It may safely be assumed that every
pfennig was booked as to its origin with the same metic-
ulous care with which, in another section of the huge
Party palace on the Konigsplatz of Munich, the records
of every individual who joined the Party were kept.
Treasurer Schwarz's accounts have never been found.
This is one of the main mysteries surrounding the last
days of the Nazi regime.
Were all these records purposely destroyed? Not un-
likely. We do know that as far as the Party membership
cards and files were concerned, they were carted to a
Munich paper manufacturer's establishment with orders
to tear them to shreds for re-use in the making of pulp,
but that the manufacturer had them dumped on an im-
mense empty floor of his largest hall. Moreover, to hide
them from possible Gestapo agents, he had them cov-
ered with inoffensive discards of outdated mimeo-
graphed form letters, printed blanks, smudgy cast-offs
from pages of books in process of printing, and the like.
Then, when the American troops conquered Bavaria,
this man alerted our security officers to the significant
material underneath all the innocuous documents. It
was thus that the Party records were recovered. It so
chanced that I accompanied the American security offi-
cer to the plant when they were seized.
116
 INDUSTRY AND HITLER ' S FINANCES

It may, therefore, very well be that some other firm

was given orders to destroy the Schwarz records and
that this firm complied.
But although the records had vanished, Xaver
Schwarz was still alive.17 One American interrogator
after another visited him. Every conceivable approach
was used by these men to extract pertinent information
from their "victims." This information was kept strictly
secret. It became public property only if it chanced to
be introduced in the various War Crimes Trials.
With three trials devoted exclusively to industrialists,
it stands to reason that the interrogators made every ef-
fort to pry loose information that would incriminate
German Big Business. Not only was that their assigned
job, but it was one which many of them pursued with
a particular relish. For, let us remember that some of
these young interrogators wearing Uncle Sam's uniform
were leftists, "pinkos," and worse. 1 8 It was natural for
them to want to "get" the prominent exponents of ''capi-
talism'' who were under indictment.
Significantly, of the thousands of pages of interroga-
tions, testimony, affidavits, and letters which were intro-
duced in the course of the I ndustrieprozesse as well as
during the first, or major, trial of top criminals, no evi-
dence concerning the industrialists was introduced as
coming from the Nazi Party Treasurer's office or from
Xaver Schwarz himself. It was the practice of the top
Nazis, of whom Schwarz was one, when captured to
unload all responsibility for their actions upon others.
It would have been natural for Schwarz to curry favor
17. He died in 1946.
18. Two of them, Kurt Ponger and Otto Verber, were later arrested
in Vienna charged with being Soviet spies and hurried off to America.
They were given long sentences.
117
 TYCOONS AND TYRANT

with his interrogators by pointing an accusing finger at

the big industrialists. The fact that he did nothing of
the sort would seem to indicate that money from indus-
try did not play the role in the Hitler scheme of things
that is commonly assumed.
Professor Kurt Hesse of the Academy for World Trade
at Frankfurt-am-Main, formerly of the faculty of Berlin
University, spent much time trying to throw light upon
the sources of Hitler's income before 1933. In an expose
describing his findings, 19 Hesse asserts:
According to the testimony of a deputy of the Reich
Treasurer of the NSDAP, c'the Party during the period be-
fore 1933 was financed first and foremost by means of mem-
bership dues and collections within their own ranks.''
Are we to attach credence to the words of the
deputy? 20
One trait of AdoH Hitler's which has rarely been com-
mented upon was his unusual ability for raising funds
in small amounts from the great masses of the people,
much as our Five and Ten Cent stores stay in profitable
business because of the multitude of small sales. Hitler
thoroughly believed that the acid test of one's convic-
tion is the willingness to part with cold cash. He there-
fore placed a sales tag on everything-membership dues,
admission fees to meetings, party buttons, emblems,
banners, streamers, pamphlets, brochures, books, news-
papers, periodicals, uniforms, photos, engravings, paint-
ings, insignia of rank, and what have you. The Zeug-
meisterei, or clothing department, for instance, of the
19. Die politischen Anklagen gegen die deutschen Industriefuhrer.
A private paper.
20. I have definite reasons for my personal conviction that the
alleged "deputy" was none other than Xaver Schwarz himseH.
-L. P. L.
118
 INDUSTRY AND HITLER ' S FINANCES

Party in due time amounted to Big Business. In addition,

there were collections of every conceivable hue and
color and for every thinkable sub-cause within the
greater Nazi cause.
Hitler thus was a shrewd and smart m.oney maker
who missed no opportunity to convert the enthusiasm
he had whipped up into hard cash.
The awareness that Hitler's hold on the masses
yielded not only millions of votes but also, in the aggre-
gate, vast sums of money, led Peter Druclker, Vienna-
born London economist, to observe as early as 1939:
The really decisive backing came from sections of the
lower middle classes, the farmers, and the ~1orking class,
who were hardest hit by the demoniac nature and by the
irrationality of society. As far as the Nazi Party is concerned,
there is good reason to believe that at least three quarters
of its funds, even after 1930, came from the weekly dues,
paid especially by the unemployed and by farmers, and
from the entrance fees to the mass meetings; from which
members of the upper classes were always conspicuously
absent. 21
Kurt Stechert, a German publicist with strong lean-
ings toward democratic socialism, supported this view
in his book, How Was It Possible? 22 He wrote in 1945:
"The wide-spread assumption that German big industry
supported the Hitler party is objectively vvrong."
Clemens Lammers of Berlin, a member of the board
of directors of the Reichsverband der deutschen Indus-
trie, who opposed its liquidation by the Nazis to the very
end; a man on terms of friendship with Pope Pius XII,
21. Peter Drucker, The End of Economic Man (London; Guild
Books, 1939), p. 105.
22. Kurt Stechert, "Wie war das moglich? Der Ursprung des Drit~
ten Reiches in historischer und soziologischer Beleuchtung (Stock~
holm; Bermann-Fischer Verlag, 1945) .
119
 TYCOONS AND TYRANT

and whose anti-Nazism was so well kno.,Nll in American

official circles that General Lucius V. (~lay made him
his special adviser on economic matters, testified in
Niirnberg on January 20, 1948: "The assumption that
German industry, especially big industry in its entirety,
supported Hitler in seizing power is a legend." 23
Walter Gorlitz and Herbert A. Quint, who wrote the
first comprehensive biography of Hitler in the German
language, arrived at the conclusion that '"one really can-
not say that Hitler was 'made~ by German big industry
to realize their expansionist plans." 24
Norman J. G. Pounds felt impelled to write: ''Hitler's
debt to the industrialists has in general been greatly
exaggerated." 25
Joseph Gobbels entered in his diary under dates of
November 11 and December 22, 1932:
Received a report on the financial situatlion of the Berlin
organization. It is hopeless. Nothing but debts ana obliga-
tions, together with the complete impossibility of ol taining
any reasonable sum of money after this defeat.. ..
We must cut down salaries of our Gauleiters, as (•ther-
wise we cannot manage with our finances.:~s
Alan Bullock wrote :
This was the time when S.A. men we:re sent into the
streets to beg for money, rattling their boxes and asking pas-
sers-by to spare something ((for the wicked Nazis." Konrad
Heiden speaks of debts of twelve million marks, others of
twenty millions.27
23. International Military Tribunal, Case VI, IG Farben.
24. Op. cit., p. 257.
25. Op. cit., p. 250.
26. Joseph Gobbels, Vom Kaiserhof zur Reichskanzlei (Munich;
Eher Verlag, 1934), pp. 200 and 225.
27. Op. cit., p. 219.
120
..
 INDUSTRY AND HITLER ' S FINANCES

And finally Former Chancellor Briining on August 24,

1948, testified at Munster in Westphalia:
The sums placed at the disposal of the NSDAP from these
sources 28 cannot have exercised any determining influence
upon the expansion of the NSDAP, for after the presidential
election campaign and again in 1933 it had s~everal million
Reichsmark of debts.
This cumulative testimony indicates that financial
subsidies by Gennan industrialists were not a decisive
factor in putting Hitler over. Whatever their support, it
cannot possibly have matched either the surns constantly
raised by the Nazis among the common folk in the man-
ner indicated, or the subventions which the industrial-
ists gave to other political parties.
Besides, their gifts did not place them :in a position
to determine Hitler's political fortunes. Without an elec-
trifying idea and a dynamic leader a mass movement
cannot succeed. National Socialism appealed to both
the national and social instincts of the German people
and had as leader a man with compelling magnetism
and unbounded energy.
At the very time when the popular legend had tycoons
pouring money into the Nazi exchequer in great quan-
tities, one section of them were, according 1to Heinrichs-
hauer, subsidizing the new Conservative Party of Gott-
fried Treviranus Hto an extent equalled by no other party
before or after." This party failed miserably because its
program was too highbrow and its leaders meant noth-
ing whatsoever to the masses.
Money is not a determining consideration when it
comes to a mass appeal. We have had nun1erous exam-
ples in American politics when a ground--swell, grass-
28. Meaning the Ruhr industrialists.
121
 TYCOONS AND TYRANT

roots movement triumphed although fighting against

overwhelming financial odds.

This chapter is in the main concerned with establish-

ing the facts regarding financial support of Hitler by
German industry before the Nazi accession to power,
in other words, during the years when support was still
a voluntary matter.
The picture changed radically after January 1933.
From then on strong governmental pressure stood be-
hind incessant Nazi requests for money. i\ll sorts of Nazi
formations and institutions beleaguered! industry with
financial demands which snowballed frighteningly.
c'Voluntary,, gifts became obligatory tributes. The situa-
tion was rapidly getting out of hand.
Roland Brauweiler, executive director of the German
Employers' Federation, now proposed that this nuisance
be stopped by assuring the Hitlerites: of a definite
monthly contribution by industry for 1their charitable
and similar projects, on condition, however, that indi-
vidual solicitations must cease, and that all assessments
and solicitations of any kind must come to an end after
one year. The party agreed.
In this manner the Adolf Hitler Spende came into be-
ing. All branches of German business: life-industry,
trade, insurance, banking, and agriculture-contributed
on the basis of .5 per cent of the 1932 payments made
by each contributor for salaries and W'ages. It meant
thirty million marks for the Nazi Party chest. Bylaws
were adopted and Krupp von Bohlen appointed heacl
of the governing board of the Spende . .Rudolf Hess as
the Fiihrer,s deputy ordered all party formations and
subsidiaries to refrain from further solicitations from
Spende participants.
122
 ,
INDUSTRY AND HITLER S FINANCES

As to heeding Rudolf Hess' order, numerous letters in

the Krupp archives indicate that Bohlen was harassed
by firms which complained bitterly that the Nazis cir-
cumvented the order by having local and subsidiary for-
mations demand contributions for causes espoused by
themselves. The Hitler Youth, the Labor Front, the SA
and SS, the National Socialist Welfare-all acted as
though the Hess order were nonexistent.
The IG Farben Concern has assembled statistics to
show the relation between its "political contributions,n
meaning the Adolf Hitler Spende and the Winter Relief,
and its sales turnover. It did this in self-defense, because
the amount contributed seems large as an unrelated fig-
ure, amounting as it does to between 1,367,000 and
3,968,000 Reichsmark annually during 1933 to 1944.
Measured by sales of IG Farben products, however, the
contribution represented only .42 per cent of the com-
pany's sales turnover in 1933, .24 per cent in 1934, and
tapering gradually to as little as .10 per cent by 1944.
The Brauweiler project, which the industrialists had
looked upon as a measure of self-defense during the first
critical year of Nazi rule only, proved to be a trap which
they had unwittingly laid for themselves. The Nazis,
seeing how easy it was by this "voluntary" assessment
method to squeeze thirty millions out of industry,
promptly forgot their solemn undertaking to limit the
Spende to one year. They insisted year after year upon
its "voluntary" repetition and, indeed, its increase. Ernst
Poensgen estimated that the Adolf Hitler Spende was
gradually upped under pressure to sixty million Reichs-
mark.
The "voluntary" character of the Spende was given
the lie by Martin Bormann, Hitler's right-hand man for
party affairs. It appears that in October 1939, because
of the cost to German industry involved in converting
123
 TYCOONS AND TYRANT

plants into war production, the then customary monthly

amount of four million Reichsmark had not been sent
on time. On November 7, Bormann advised Krupp's
counsel that "I am absolutely of the opinion that this
amount must be collected from industry under compul-
sion if it should not be forthcoming voluntarily."

124

,.-·
CHAPTER SIX

German Industrialists
and the Trade Unions

A t first blush it may seem somewhat out of place to

discuss the relation of German industry to the trade
unions in a book devoted to tycoons and their relation
to a tyrant. As was pointed out in the Foreword, how-
ever, pundits have assiduously fostered the impression
that the German labor unions were a thorn in the flesh
of the tycoons, who therefore turned to Hitler to remove
it. Is this impression justified?
During the Weimar Republic, capital and labor in
Germany on the whole got along rather satisfactorily, at
least in comparison with other countries with large in-
dustrial populations. There was no featherbedding, no
racketeering, no closed-shop insistence. The political
thunder of mutual name-calling in the party dailies and
in the organs of the trade unions and employers' federa-
tions need not be taken too seriously. Both sides had to
keep their huge membership in line by harping on the
alleged aggressive designs of their opposite numbers.
The Revolution of 1918, followed by the abolition of
the monarchy, had brought the Social Democrats to the
top. Friedrich Ebert, a socialist, became the first President
of the Weimar Republic. The Social Democratic Party
125
 TYCOONS AND TYRANT

held important positions in cabinet after cabinet. The

trade unions, preponderantly Social Democratic, exer-
cised great influence in the struggling young republic.
At first the industrialists viewed the situation with a
jaundiced eye. Their fears were aggravated by the crea-
tion of an extra-parliamentary Committee on Socializa-
tion in 1919 which was to devise ways and means of
taking coal and later iron and steel out of private hands.
Fortunately for them the committee soon died a natural
death.
To the relief of the German bourgeoisie the Social
Democrats proved far less revolutionary than had been
expected. President Ebert emerged as a dependable sta-
bilizing influence. Men like Gustav Noske, minister of
defense, Carl Severing, the later minister of the interior,
and other leaders were quite as energetic in curbing
excesses of the left as they were in defending the rights
of the workers. Reichstag President Paul Lobe, another
Social Democrat, presided with unusual ability and fair-
ness over the often stormy sessions of the young repub-
lic,s parliament.
Towering above all other labor leaders as far as abil-
ity, shrewdness, and statesmanship was concerned, was
Carl Legien, president of the Allgemeine Deutsche Ge-
werkschaftsbund (German General Federation of Trade
Unions), which around 1920 had a membership of about
four million. Legien was the Samuel Gompers of Ger-
man labor.
In the world of industry, Hugo Stinnes attracted in-
ternational attention by his unorthodox methods of
industrial empire building. The Stinnes Concern became
a colossal undertaking of which nobody, not even the
owner himself, seemed to know its bounds. Stinnes was
forever on the go, restless, ambitious, full of energy, full
126
 INDUSTRIALISTS AND THE TRADE UNIONS

of ideas. With his thick, black Assyrian beard and his

cheap, simple clothes he was the cartoonists' delight.
Both Legien and Stinnes were members of the Reichs-
tag. Both were watched with keen interest by a col-
league, Hans von Raumer, a sagacious, scholarly man
with an intimate knowledge of politics and industry,
who had long given thought to the problem of improv-
ing worker-employer relations. Raumer was the execu-
tive director of the Central Federation of the German
Electro-Technical Industry, in which he had important
interests. He represented the German People's Party in
the Reichstag, and later, in 1923, became Reich Minister
of Economy.
During an hour's talk which I had with him in 1953,
Raumer said he had picked Legien and Stinnes as two
men who, if brought together, might become powedul
forces for industrial peace. He therefore invited both
to meet at his home for a heart-to-heart talk.
To the amazement of the Social Democrats and the
lords of industry, both accepted. It was the sort of thing
that simply was not done in those days. In general class
differences and political antipathies were still so strong
that a publisher, let us say, of a Democratic paper would
not think of inviting his colleague of a Conservative or-
gan to his home. At best the two might meet at the
Press Club, but even then they would hardly pick each
other as table companions. If a person traveling first
class on a railway took the Social Democratic Vorwii:rts
(Forward) out of his pocket, others in the compartment
were likely to snub him. The same thing might happen
to a passenger in a third class compartment who was
caught reading the ultra Conservative Preussische
Kreuzzeitung ( Prussian Iron Cross Newspaper) .
It was therefore no small thing that Raumer accom-
127

.....
 TYCOONS AND TYRANT

plished in bringing these two self-willed, politically op-

posed men together. The experiment was well worth
while: the evening ended with Legien and Stinnes in
full knowledge of each other~s philosophy and points
of view, cognizant of the justified claims of the interests
each represented, and mutually respecting each other,
for each had spoken with utter frankness and honesty.
This first meeting of the two pioneers in better em-
ployer-worker relations was followed by many subse-
quent ones.
Once as the two men sat together Stinnes urged
Legien to attend the christening of his latest ship in the
Hamburg ship yards. Legien accepted. As he arrived
at the wharf, he was rather ceremoniously conducted
to the high platform on which the speakers and special
guests were assembled. Imagine his surprise when the
words rang out, as the champagne bottle crashed against
the side of the stately vessel, "I christen thee Carl
Legien."
More important even than this accord between one
labor and one industrial leader was the fact that their
example found followers. When in October 1918 Stinnes
at a session of the Steel Industrialists~ Federation pro-
posed that the fight against the trade unions be aban-
doned and a co-operating working body with delegates
in equal numbers for labor and capital be created, the
proposal was adopted enthusiastically. This body be-
came known as the Deutsche Arbeitsgemeinschaft (its
official name was Zentral-Arbeitsgemeinschaft der ge-
werblichen und industriellen Arbeitgeber und Arbeit-
nehmer Deutschlands).
The agreement signed on November 15, 1918, be-
tween the national federations of the employers and the
workers was hailed as the Guarantor of Peace in Indus-
128
 INDUSTRIALISTS AND THE TRADE UNIONS

try. It recognized the trade unions as the accredited

representatives of labor, declared any limitation on the
freedom to organize unpermissible, pronounced the
eight hour day as the maximum work day, obligated the
employers to drop the so-called company unions, and
pledged both sides to regard trade union rates as the
basis for regulating conditions of work.
Even Paul Reusch, despite his many misgivings about
organized labor, told the writer in October 1952 that
"Stinnes and Legien found me in full accord with their
Arbeitsgemeinschaft. It was a great deed."'
One especially important advocate of the Arbeitsge-
meinschaft was Ernst von Borsig of locomotive construc-
tion fame, who had during World War I been instru-
mental in frequently bringing management and labor
together. He was for many years president of the Ger-
man Employers' Federation.
The Arbeitsgemeinschaft never had any clearly de-
fined functions, yet its moral influence was vast. The
fact that here labor and management met on a basis of
parity facilitated free, frank exchange of views on com-
mon problems.
Unfortunately a difference of opinion regarding hours
of work in the coal and heavy industries of Rhineland-
Westphalia early in 1924 led to the withdrawal of the
General Federation of Labor from the Arbeitsgernein-
schaft, which then ceased to have any practical value.
Nevertheless, this attempt to bring employers' and
workers' representatives together at a round table had
been successful long enough to lead to the creation of
a Federal Economic Council ( Reichswirtschaftsrat), an
advisory body to the government made up equally of
representatives of both groups. This council began its
sessions as a provisional institution in June 1920 even
129
 TYCOONS AND TYRANT

before the proper legislation had been passed. Somehow

the government never got around to anchoring this crea-
tion in law, but it continued nevertheless to meet and
advise the government throughout the Weimar Re-
public.
Thus a new and better chapter in capital-labor rela-
tions had been written and, as the years passed, the
trade unions and the employers' federations accepted
their opposite numbers as equal partners.
There were, quite naturally, stubborn fights regarding
wage scales, hours of work, conditions under which men
and women labored, pensions, insurance, and the like.
But these were carried out in full acceptance of the op-
posite number as the qualified and even indispensable
spokesman for his group.
As far as management was concerned, thoughtful
leaders soon noted that the great majority of the labor
bureaucracy constituted a powerful bulwark against
communistic radicalism. Union representatives were
amenable to reasonable compromise. Through their
Works Council delegates they had an insight into the
business conditions and problems of the various plants.
This knowledge made them more moderate.
In the years following World War I, many interna-
tional conferences dealing with economic matters took
place in Europe to arrive at such settlements as the
Dawes and Young Plans. To each of these meetings the
German government sent delegations composed of rep-
resentatives of both labor and management. These
worked harmoniously side by side, guided by their devo-
tion to their country's welfare. Peter Grassmann, vice-
president of the General Federation of Trade Unions, a
Social Democrat, was especially highly respected for his
grasp of the reparations problem.
130
 INDUSTRIALISTS AND THE TRADE UNIONS

The German worker has always shown a keen sense

for discipline and order. Wild strikes, provoked against
the will of the trade union leadership, were far less fre-
quent in Germany than they are, for instance, in our
country at this time. This meant that employers, once a
wage agreement had been signed, could rely upon the
unions to carry out their side of the bargain.
True, there were some industrialists who were out-
spoken opponents of the trade unions. Paul Reusch, as
previously indicated, was as bitter in his fight against
the unions as he later was in opposing Hitler. Emil Kir-
dorf was vehemently anti-labor union. On the other
hand, Fritz Thyssen regarded the trade unions as an
indispensable part of the German industrial setup.
Whatever individual opposition to trade unions there
may have been on the part of individual industrial lead-
ers, the fact remains that one looks in vain in any official
employers' organ for any demand to eliminate them.
Never at any time was a request for their liquidation
made to any department of government.
This does not preclude the existence of a trend within
industry toward criticizing the fact that so much time
was consumed in negotiations with the labor unions.
This trend failed to take into account the indispensa-
bility of accredited labor representation in modem in-
dustry.
If sympathies for the Nazi cause existed among some
industrialists, these were to a large extent generated by
hopes that life would become simpler if the Fuhrer-
prinzip (leadership principle) were to supplant demo-
cratic self-government in industry. But these latent,
often only subconscious sympathies found expression
only in moods and grumblings. They did not crystallize,
let alone lead to co-ordinated action. Nevertheless it is
131
 TYCOONS AND TYRANT

important to register them here. They weakened the

front against Hitler. They retarded realization of the
Nazi danger while there was still time.

The industrialists knew as well as did those of us who

were on duty as journalists at the time that the Commu-
nists regarded the Social Democrats as their principal
enemy. The Rote Fahne (Red Flag), official organ of
the Communist Party of Germany, on November 16,
1932, had written in reply to an invitation by the Social
Democratic Party to join in the fight against fascism,
"Our main blow is directed at the Social Democracy." 1
What interest, one may well ask, could thoughtful
industrial leaders have in desiring the abolition of the
socialist-controlled trade unions when Social Democracy
was regarded by the Communists as their No. 1 Enemy?
Besides being bulwarks against Communism, the
trade unions were looked upon as welcome time-savers
for company managements. Emil Pouplier, owner of a
middle-sized steel manufacturing plant, explained this
to me when I sat with him and about thirty workers in
a Bierstube of the small town of Burg, in the Ennepe
Valley of Westphalia:
In our modern plants it is next to impossible for the owner
or manager to receive every worker individually to fix his
wages, determine the conditions of his work, and the like.
We employers therefore welcomed the existence of repre-
sentative organizations of the workers whose delegates could
speak for the whole group.
The workers nodded assent. These hardy, tanned,
strong-fisted men had come together for their usual
1. Friedrich Stampfer, Die ersten vierzehn Jahre der Deutschen
Republik (Offenbach/Main; Bollwerk Verlag, Karl Drott, 1947), p.
609.
132
 INDUSTRIALISTS AND THE TRADE UNIONS

song-fest. They looked forward all week to the Saturday

evening when they could abandon themselves to singing
lustily and, I may add, beautifully in a male chorus of
which Emil Pouplier was the volunteer amateur con-
ductor. The happy group seemed to me to be an ex-
cellent example of an ideal worker-employer relation-
ship.
How well the sane elements in management realized
that the trade unions were the most dependable allies
in times of social crisis may be judged by the following
two incidents:
In April 1933, soon after the Nazis in a misleading
communique had claimed that the Reichsverband der
deutschen Industrie 2 had agreed to the acceptance of
two Nazi commissars to supervise its work, Gustav
Krupp von Bohlen suggested that contact be sought
with the top trade union officials with a view to saving
both the workers' and employers' organizations from
Nazi seizure. Among the men consulted by him were
Albert Vogler and Ernst Brandi of United Steel and
Fritz Springorum of the Hoesch Concern. Krupp's pro-
posal was that an Arbeitsgemeinschaft along the lines
of that existing for the whole Reich be duplicated spe-
cifically for the heavy industry of the Ruhr. Vogler and
Brandi agreed with him in principle, but on inquiry
found that the unions had already become so weakened
and Nazi-infiltrated that the hour had passed for the
realization of such a project. 8
This happened only a few weeks before the coup
d'etat of Robert Ley, the later head of the German
Labor Front, who on May 2, 1933, with his henchmen
raided trade union headquarters throughout Germany,
seized their books and especially their assets amounting
2. Cf. Chapter Eight, p. 159.
3. A. Heinrichsbauer, op. cit., p. 64.
133
 TYCOONS AND TYRANT

to more than one hundred million marks, arrested thou-

sands of labor officials, and liquidated the German Gen-
eral Federation of Trade Unions.
This highhanded action created consternation in the
ranks of the industrial leaders. They rightly feared that
the wiping out of the existing collective representation
of labor would be followed by the forced elimination
also of the collective representation of the employers
and the seizure of their treasuries.
A meeting followed at the home of Carl Friedrich
von Siemens of Berlin. Apparently the participants did
not know the full extent of Ley's action. For, Geheimrat
Hermann Bucher volunteered to establish contact with
Theodor Leipart, the successor of Carl Legien, and
Fritz Tarnow, economic expert of the General Federa-
tion of Labor and president of the Wood Workers'
Union. Hitler or no Hitler, Ley or no Ley-so the dis-
cussion ran-the established organizations of employers
and organized labor must continue as opposite numbers.
After the meeting adjourned, Bucher had to learn to
his dismay that his proposal came too late-the labor
leaders already sat behind the barsl
The trade unions, too, had been in blissful ignorance
of the planned blow at their existence. They had even
been hopeful that their organizations could be fitted
into the new scheme of things. Hence, they had urged
their members to take part in the traditional May Day
celebrations throughout the Reich, during which mil-
lions of toilers were herded together on huge parade
fields as they listened to a broadcast address which Hit-
ler delivered in Berlin.
The very next day they were stunned to learn that
the Nazis had taken over the trade unions and all their
assets. Self-government in industry had come to an end.
Factories and plants were now overrun by political
134
~·
 INDUSTRIALISTS AND THE TRADE UNIONS

commissars who issued stupid orders which interfered

seriously with business. The merits of an undertaking
were now judged by the number of Nazi flags displayed
or the intensity of the n9ise produced by shouting "Heil
Hitler." Workers and employers were soon to be forced
into the strait jacket of the totalitarian German Labor
Front.

135
CHAPTER SEVEN

A Brief Political
Honeymoon

January 1933 was a fateful month for Germany, and,

indeed, the world. Fifty-nine-day Chancellor Kurt von
Schleicher had staked everything on provoking a split
within the Nazi ranks by offering Gregor Strasser the
vice-chancellorship in his cabinet. The attempt failed.
Hitler got wind of it before Strasser could act, "with the
result that Hitler 'disciplined' his erring lieutenant and
stripped him of his party offices, though he had been
amongst the oldest members of the movement.'' 1
The crafty von Papen had foreseen von Schleicher's
failure and, as already pointed out, on January 4 had
secretly met Hitler at the home of Banker von Schroder
in Cologne. As he represented the situation in his mem-
oirs, Papen feared that a split in the Nazi ranks would
drive the radicals into a coalition with the extreme left.
He thought the better way was to keep the Nazis to-
gether and to load them down with responsibility by
taking them into the govemment.2
1. John W. Wheeler-Bennett, Hindenburg the Wooden Titan
(London; Macmillan and Co., Limited, 1936), p . 428.
2. Franz von Papen, Memoirs (London; Andre Deutsch, 1952),
p. 226.
136
 A BRIEF POLITICAL HONEYMOON

Papen deceived himself in thinking he could manage

Hitler, all the more so since Hitler artfully played the
roie of a moderate. Der Fuhrer was ready to accept
Papen or even Schleicher as vice-chancellor in a cabinet
headed by himself. He was content "merely" to appoint
Nazis to the offices of Reich minister of the interior and
Prussian minister of the interior. He seemed rather in-
different to other cabinet positions.
Jubilantly, Papen later told his friends, "We have
hired Hitler'' ( ~~wir haben Hitler engagiert") . Both he
and Alfred Hugenberg, who entered Hitler's coalition
cabinet by the end of January, thought they were old
hands at politics. Hitler easily outsmarted them. He
asked himself realistically where the real power would
be centered once he became chancellor. The answer
was : control of the federal ministry of the interior meant
control of the vast administrative apparatus of the
Reich; control of the Prussian ministry of the interior
meant above all control of the police in two-thirds of
Germany. Hugenberg when invited into the proposed
coalition deemed it all-important that he should head
the ministry of economics, for then he could-so he
thought-steer a sane economic course. Hitler raised no
objection; he knew that from his three key positions he
could nullify any act of Hugenberg's that might not
meet with his approval.
There was one other position of power: the defense
ministry. Papen at Cologne, according to Paul Sethe of
the Frankfurter Allgemeine Zeitung, 3 urged the appoint-
ment of General Werner Baron von Fritsch, chief-of-staff
of the army, as minister of defense. Hitler ignored the
suggestion; Papen did not insist. When the first Hitler
3. "Was Hitler besser wusste," editorial in the Frankfurter Allge-
meine Zeitung, Frankfurt-am-Main, September 23, 1952.
137
 TYCOONS AND TYRANT

cabinet was announced on January 30, the name of a

hitherto rather obscure general, Werner von Blomberg,
appeared as that of the new Reich minister of defense.
Hitler had met him through an ardent Nazi army chap-
lain, Ludwig Muller, the later Reich Bishop, and had
easily enthused the general, an unsteady character, over
the Nazi cause. By the appointment of Blomberg the
last bastion of real power in the Weimar Republic was
won. Without batting an eye, Adolf Hitler solemnly
swore to uphold the republican constitution and, bow-
ing deeply, shook the hand of President von Hindenburg
in the Garrison Church of Potsdam.
Did German industry play an influential role in the
world-shaking event of January 4, 1933? The evidence
points to the contrary. Baron Schroder acted strictly on
his own in arranging for the Hitler-Papen meeting. It
was to have been kept a closely guarded secret. Even
Chancellor von Schleicher's intelligence service had no
knowledge of it. One enterprising newsman, however, of
the staff of the Tiigliche Rundschau of Berlin, got wind
of the meeting, hid somewhere opposite the Schroder
mansion with his cameraman, and the next day broke
the story, accompanied by snapshots of Hitler and Papen
entering or leaving the scene of their momentous con-
ference.
Von Papen, both in his memoirs and throughout his
trial at Niirnberg, has consistently declared the allega-
tion to be untrue that, as a result of his intervention,
the huge deficit of the Nazi Party was shouldered by
Rhenish-Westphalian industrialists in return for prom-
ised concessions by Hitler when he came to power. •
Von Papen's optimistic announcement, however, ''We
have hired Hitler,'' seeped quickly through the channels
4. Cf. Chapter Five, p . 115.
138
 A BRIEF POLITICAL HONEYMOON

of information which industry controlled and undoubt-

edly helped pave the way for the calm acceptance of
Hindenburg~s decision to appoint Hitler chancellor and
to take two other Nazis into the new government-
Wilhelm Frick as minister of the interior and Hermann
Goring as federal minister without portfolio but also as
Prussian minister of the interior.
One of the most important figures in industry, how-
ever, did take the bold step of warning the President
on the very eve of Hitler~s appointment against this con-
templated designation-Gustav Krupp von Bohlen und
Halbach.
Fritz Thyssen in I Paid Hitler 5 wrote as follows:
Until Hitler~s seizure of power Herr von Krupp was his
violent opponent. As late as the day before President von
Hindenburg appointed Adolf Hitler chancellor, he urgently
warned the old field marshal against such a course.
Hermann Biicher, too, has testified that von Bohlen
"had no use for Hitler~' during the years before his sei-
zure of power.

To the industrialists, as indeed to many Germans and

foreigners in all walks of life, the first Hitler cabinet
looked like a promising one, considering the prevailing
situation. It contained only three Nazis, and these were
flanked and encircled by Franz von Papen as vice-chan-
cellor; a diplomat of the old school, Baron Konstantin
von Neurath, as foreign minister; a scion of an ancient
family who had served Bruning and Papen well, Count
Lutz von Schwerin-Krosigk, as finance minister; a gen-
eral of impeccable manners, Werner von Blomberg, as
defense minister; a Catholic lay leader, Eltz von Ri.iben-
ach, as minister of transportation; the head of the mon-
5. Op. cit., pp. 103-104.
139
 TYCOONS AND TYRANT

archist Stahlhelm (Steel Helmet) veterans' organization,

Franz Seldte, as minister of labor; a conservative Bavar-
ian jurist, Franz Gurtner, as minister of justice; and old
Geheimrat Alfred Hugenberg himself, not exactly pop-
ular with the leading industrialists, but at least respected
by them, as minister of economics and of agriculture.
Were these men, the tycoons asked themselves, not ef-
ficient safeguards against any usurpation of power by
the young political upstart Hitler? And had he not sworn
to uphold the democratic Weimar Constitution? Above
all, the Grand Old Man of the Right, Field Marshal von
Hindenburg, was still the commander-in-chief of the
armed forces and with one word of command could
squelch any Nazi excess.
There is nothing astonishing in the fact that the in-
dustrialists tended to consider events in Berlin merely
as the advent of another cabinet cast in the usual form,
except that the circumstances surrounding its appoint-
ment were a little more unusual and the person ap-
pointed to head it more colorful. Here was a man at
least who seemed ready to take personal responsibility
and expected all members of the cabinet to do likewise.
The end had come of anonymous government by polit-
ical party bureaucracies. This man seemed determined
to attack the problem of unemployment vigorously.
''Give me four years' time/' he said on the evening of
January 31 in his first nation-wide radio broadcast after
his appointment as chancellor, "and unemployment will
be a thing of the past." Jobs for all-what a boon to a
despairing industry!
The radio address revealed other points of his pro-
gram. The new government, he asserted, would bring
about the spiritual and purposeful unity of the German
people. It would be guided by Christianity as the basis
of its morals, would restore the family as the foundation
140
 A BRIEF POLITICAL HONEYMOON

of civic life, would re-establish reverence for tradition.

The proposed four year plan for the elimination of un-
employment was to encompass both industry and agri-
culture. Communism was to disappear from Germany.
As to foreign relations, Hitler said he hoped general
disarmament would make any increase of Germany's
armed forces unnecessary, but meanwhile the army must
be so strengthened as to render it capable of defending
the fatherland effectively. Internationally, Germany
must regain her complete freedom, so that she might
again be an equal among equals in the comity of nations.
Already in his first official proclamation he made use
of one of his most successful tricks of demagogy: he
stressed the peaceful intentions of his regime. This em-
phasis upon peace, repeated by Hitler in season and out
of season, is often overlooked or at least its impact upon
German public opinion underrated.
What Hitler proposed in his radio proclamation
seemed, on the whole, to be a reasonable program to
which Germans of every political faith might subscribe.
The new minister of the interior, Wilhelm Frick, pledged
his word to the press that no interference with its free-
dom was contemplated. That, too, together with the ab-
sence of any indication that extreme anti-Semitic meas-
ures were in the offing, reassured many people includ-
ing Germany's tycoons that Hitler was, after all, not as
radical as they had feared.

Many of us Americans will recall how Franklin Delano

Roosevelt was cheered when, at the beginning of his
long administration, he wrought the seeming miracle of
putting a stop to the bank failures that had already taken
a terrible toll of economic life. It was only years later
that we found out that the new president had merely
pulled the plan which saved us from financial chaos out
141
 TYCOONS AND TYRANT

of the desk where his predecessor, Herbert Hoover, had

left it for him.
Adolf Hitler, too, seemed to work a miracle by his
government's plan for eliminating unemployment. The
author of the plan, however, was the Bruning govern-
ment. More specifically, the versatile Friedrich Minoux
in November 1930 had submitted to Chancellor Bruning
at the latter's request a twelve-point program, entitled,
uSuggestions for the :Elimination of Unemployment.n
These suggestions, together with similar ones from other
sources, were accepted almost in toto by the Bruning
cabinet, and found expression in a series of decrees
which the chancellor, under emergency powers granted
him via the president in accordance with the provisions
of Article 48 of the w~eimar Constitution, was about to
promulgate when he fell from grace and was compelled
to resign.
Minoux' authorship was known to German industry.
The fact that Hitler a•ccepted the plan of one of their
number could only assuage and abate any apprehensions
they were harboring concerning Hitler's personality.

Hitler, as nobody in Germany before him, understood

the importance of the available mass media of informa-
tion. In a thousand-and-one ways the nation was made
aware that a modern St. George had set out to slay the
dragon of unemployment. Loudspeakers in every factory
and on the big public squares, weekly news reels per-
sonally put together by Hitler and Gobbels, streamers
with the words, .uAll this we owe to our Fuhrer,'' dis-
played at every new construction, placards, fly-leaves,
leaflets, brochures, even sky-writing airplanes-all this
proclaimed the glory o:f the new regime. The masters of
coal and steel were thus automatically subjected to a
tremendous pressure of public opinion in case they dared
142
 A BRIEF POLITICAL HONEYMOON

criticize Hitler or take exception to any of his measures.

Hitler had hardly begun to put his plagiarized pro-
gram into effect, when Hermann Goring on his behalf
summoned a group of about twenty prominent indus-
trialists to come to Berlin on February 20, 1933. Place of
meeting: the palace of the Reichstag president; Goring
had succeeded Paul Lobe when the number of Nazi dep-
uties exceeded that of the Social Democrats. Hjalmar
Schacht because of his personal acquaintance with all
the "big shots, of industry functioned as master of cere-
monies; Adolf Hitler and Hermann Goring did the talk-
ing. Among the invited were Gustav Krupp von Bohlen
und Halbach, Albert Vogler, Georg von Schnitzler and
another representative of IG Farben, Ernst Tengelmann,
Essen coal magnate, Hermann Behrens, representing the
lignite interests, one representative each of General
Electric and Siemens, as well as several leading bankers
and topflight representatives of the metal, iron, and tex-
tile industries. On this occasion Krupp von Bohlen met
Hitler for the first time.
Hitler,s address was intended to reassure business.
Private enterprise, he promised, would be encouraged
by the new regime, and private property recognized.
Nothing was said about abolishing the labor unions nor
about ousting Jews from business, nor about rearma-
ment. I quote briefly from his half hour talk:
Private enterprise cannot be maintained in an era of
democracy; it is conceivable only when authority and per-
sonality constitute its supporting ideas. Whatsoever has been
created in the world in the way of positive, good and valu-
able achievement in the realms of economics and culture
rests solely on the importance of personality. The moment,
however, that the defense of what has been created as well
as the political administration thereof has been handed over
to a majority, it is hopelessly doomed.
143
 TYCOONS AND TYRANT

An impossible situation is created when one section of

a people favors private property while another denies it.
A struggle of that sort tears a people apart and the fight
continues until one section emerges victorious. . . .
It is not by accident that one man produces more than
another; the concept of private property is rooted in this
fact . . . . Human beings are anything but similar, and when
they are not led, they fall back into a most primitive pri-
mordial condition. . . .
As far as Wirlschaft [i.e., business and industry] is con-
cerned, I have but one desire, namely, that it may enter
upon a peaceful future on a parallel with our domestic re-
construction. . . . There will, however, not be domestic
peace unless Marxism has been terminated. It is here that
a decision must be brought about, no matter how hard the
fight.
When one considers that the twenty or twenty-five
men whom Goring had invited were carefully hand-
picked because of their financial potentialities, it may
be assumed that these words were music in the ears of
the listeners despite the slur on democracy. But Hitler
ended his remarks with turns of speech that should have
alerted them to something ominous, dangerous, and
revolutionary in the offing,-something that none of them
except a few radicals of the right desired, something that
they had until now done everything to prevent, some-
thing ugly and as inimical to private enterprise as it was
to all other forms of free expression: dictatorship.
This is what Hitler said in part toward the close of
his address :
We are now about to hold the last election. No matter
what the outcome, there will be no relapse ( Riickfall), even
if the pending election brings no decision. One way or the
other, if the election is not decisive, the issue must be settled
in another manner. I have evolved the idea of giving the
144
 A BRIEF POLITICAL HONEYMOON

people one more opportunity to decide upon its own fate.

. . . But if the election brings no solution, very well, Ger-
many won't go to pieces . . ..
There are only two possibilities: either the defeat of the
opponent [is brought about] by constitutional means (and
for this purpose this one more election), or a fight will be
waged with different weapons which will possibly demand
greater sacrifices. I should like to see it avoided. I trust that
the German people is conscious of the greatness of this hour,
which will be decisive for the next ten, yes, perhaps hun-
dred years.
Coming from a man who only twenty-two days pre-
viously had solemnly sworn to defend the Weimar Con-
stitution, these words should have registered with his
listeners as a blatant violation of his oath of office. But
once again Hitler cast a spell over his audience. At least,
nobody rose to dissent. Nobody challenged his avowal
that he would continue in power irrespective of the out-
come of the Reichstag election. Krupp von Bohlen had
even prepared a paper to voice certain objections.
Instead, he now thanked the new chief-of-government
and voiced approval of his general plans.
During my service of almost a quarter century in
Germany I have as a matter of journalistic duty attended
scores of mass meetings and smaller gatherings ad-
dressed by Adolf Hitler. I often came home after such
meetings saying that I just could not understand why
it was so, but the fact could not be denied that Hitler
somehow had an effect upon his audience that could
without exaggeration be called hypnotic. The rough,
unmusical voice which often broke, the ungrammatical
language used, the unfairness of his vitriolic attacks upon
his opponents, the lack of logic in his arguments, the
incessant repetition of shopworn cliches-all this was
forgotten once Hitler really got started. So on that eve-
145
 TYCOONS AND TYRANT

ning of February 20, jtoo, Hitler carried everything be-

fore him.
If Hitler's words did not alert the tycoons to the real
intentions of the Nazis, the remarks of Hermann Goring,
who followed his lord and master, should have done so.
True, he, too, began moderately, even more so than
Hitler himself. He felt confident, he said, that a period
of quiet development was in store for business ·and in-
dustry. No radical experiments would be undertaken in
the realm of economics. But to insure this quiet devel-
opment, it was necessary for the new coalition govern-
ment to emerge victorious in the March 5 election. As
the new government did not propose to use one pfennig
of the taxpayer's money for political purposes, it was
more necessary than ever that campaign funds be raised
in another manner.
Then came the giveaway. Goring ended his remarks
with these words:
The sacrifice asked for from industry will be the easier
to bear if it is realized that the election of March 5 will
be the last for ten years, in all likelihood, indeed, for one
hundred years.
Far from grasping the devastating significance behind
these words, these leaders of finance and industry
seemed relieved at the thought that this would mean
the end of campaign contributions. They seemed un-
aware that, in yielding to the demands of the two law-
breakers that night, th.ey were establishing a precedent
for Nazi blackmail that was to plague them for the next
thirteen years.
Hardly had Goring: sat down, when the voice of
Hjalmar Schacht was heard. It was the briefest but the
most expensive speech of the evening: ~~Und nun, meine
146
 A BRIEF POLITICAL HONEYMOON

Herren, an die Kasse'' ("And now, gentlemen, pony

up'').
The men thus mulcted agreed among themselves and
after consultation with Schacht that an election cam-
paign fund of three million marks (about $720,000)
would be raised by German industry, to be distributed
between the National Socialist, German National, and
the German People's parties according to their pres-
ent strength in the Reichstag. That is how the three
million marks campaign contribution of German indus-
try came into being.
Goring told an untruth to the industrialists when he
asserted that no taxpayer's money would be used for
the campaign. Every political meeting the Nazis now
held was declared a Staatsakt, an act of state, the costs
for which were accordingly paid from the public treas-
ury. Radio time, too, was made available at public ex-
pense, for the broadcasting stations were state property.
Minister of the Interior Frick had been even quicker
in giving the lie to his assurance that there would be
no interference with freedom of speech and the press.
On February 6 a decree was promulgated banning op-
positional meetings, demonstrations, and organs of the
press.
Seven days after the meeting at Goring's home, the
Reichstag went up in flames. I remember the night as
though it happened only yesterday. The chief corre-
spondents of the large American, British, French, and
Japanese news agencies with their wives happened to
be the dinner guests of the head of the official Ger-
man news agency, the Wolffsche Telegraphen Biiro
(W.T.B.). We had just finished the main course, when
our host, Dr. Hermann Dietz, was called to the tele-
phone. The jovial man returned to the table pale. ~~The
147
 TYCOONS AND TYRANT

Reichstag is aflame; evidently incendiarism," he an-

nounced.
""Cui bono?,, was the immediate question asked by
one of my colleagues. Yes, who stood to profit by this
act? The answer was unanimous: only the Nazis. What
we felt that evening was shared by people in Germany
generally-it was obviously the Nazis who caused the
fire in order to pin it on to the communists and then
have an excuse for smashing their organizations and
organs.
But Hitler went much further. The following day he
had Hindenburg sign a decree '"For the Protection of
the People and t4e State" which suspended the guar-
antees of individual liberty under the Weimar Consti-
tution, authorized the Reich government to take over
full powers in any federal state if necessary, and insti-
tuted the death penalty, or hard labor for life, for con-
spiracy to assassinate members of the government, or
even for ugrave breaches of the peace,-a hazy phrase
subject to willful interpretation. Said the decree:
Thus, restrictions on personal liberty; on the right of free
expression of opinion, including freedom of the press; on
the rights of assembly and association; violations of the pri-
vacy of postal, telegraphic and telephonic communications;
warrants for house searches; orders for confiscation as well
as restrictions on property are permissible beyond the legal
limits otherwise prescribed.
The German people accepted this sweeping decree
meekly, partly because they did not immediately grasp
its full significance, partly because they still believed the
blatant, omnipresent propaganda of the new Minister
for Public Enlightenment and Propaganda, Dr. Joseph
Gobbels, partly because they were filled with a new
hope that better times were coming, and partly because
148
 A BRIEF POLITICAL HONEYMOON

they thought this was merely a pre-election measure-

things would settle down after March 6 and normal con-
ditions would then be resumed.
There was an old saying with which most persons who
viewed Nazi excesses with misgivings assuaged their
consciences. I heard it repeated with maddening monot-
ony: ""Wo gehobelt wird, M fallen Spiihne~~ (literally,
"'Where there is planing, shavings fall"). It showed the
confused thinking of the period. For, when a carpenter
applies his plane, it is to improve and beautify and make
serviceable the rough wood that he is handling, but not
to destroy the object on which he is working. Each "shav-
ing," however, that the Nazis caused to fall was a pre-
cious item of human freedom and justice.
The sinking hopes of industrialists and others who
began to notice how they had been double-crossed by
the Hitlerites were raised somewhat by the results of
the March 6 election. Despite the costliest, most aggres-
sive and most intensive campaign ever conducted by
any political party in Germany, a campaign in which
the media for public information were overwhelmingly
under the control of the Nazis, Hitler and his minions
garnered only 43.9 per cent of the votes, or 288 Reichs-
tag seats out of a total of 647. Thanks to the political
ineptitude of Alfred Hugenberg, however, Hitler was
able to add the 52 seats of the German Nationalists to
his own for voting purposes, a fact which gave him a
bare majority.
What Hugenberg did not seem to realize, but what
the smart politician Hitler was quick to see, was the
fact that if the Communist Party were to be outlawed
and its 81 seats in the Reichstag declared null and void,
the Nazis would command a clear parliamentary ma-
jority even without the Nationalist votes. The 81 Com-
munist deputies were promptly excommunicated.
149
 TYCOONS AND TYRANT

In command of a majority, Hitler might well have

put through one bill after another. But he wanted all
power for himself, quickly. He drafted a unique law
which became known as the Enabling Act. Its official
title was Law for Alleviating the Distress of People and
Reich, the effect of which was nothing less than the de
facto abrogation of the Weimar Constitution and the
legal erection of a dictatorship without the formal de
jure abolition of the fundamental law of the land.
For this, however, he needed a two-thirds Reichstag
majority, as the Enabling Act represented an alteration
of the constitution. The Social Democrats alone had the
courage to stand up against Hitler and cast their 94
votes (some of their 120 deputies had already been
arrested by Goring's police) against the Act in the ses-
sion of March 23, 1933.6
The only other party which might have prevented a
two-thirds majority was the Catholic Center with its 73
deputies. We now know that the jitters-or was it the
credulity?-of one man, Prelate Ludwig Kaas, chairman
of his "fraction" (as each party group of deputies was
called) turned the scales in Hitler's favor. The Kaas
story is here told in some detail because it illustrates
how the Nazis used dubious devices to push their meas-
ures in feverish tempo:
The Centrist Party had agreed to vote for the Enabling
Act on condition that Hitler promise in writing, as he
had already done in verbal negotiations, never to use
the power conferred on him by the Enabling Act with-
out having first consulted President von Hindenburg.
As the hour of voting approached, Kaas inquired of
6. For a vivid description of the ceremony in the Potsdam Garrison
Church on March 21, to mark the opening of the Reichstag, see Alan
Bullock, op. cit., pp. 242-43.
150
 A BRIEF POLITICAL HONEYMOON

Hitler where the promis·e d letter was. Der Fuhrer re-

plied it had already left lhis office and was in the hands
of Minister of the lnterio1r Frick for delivery to the Cen-
trist ccfraction." Frick in turn solemnly assured Kaas on
the floor of the House that a messenger had brought the
letter to his ( Kaas') offiee.
The letter never was delivered. The Enabling Act now
was up for its third and final reading. Otto Wels, floor
leader of the Social Dernocrats, announced the opposi-
tion of his party as Storm Troopers outside the Reichstag
kept shouting, "We demand the Enabling Act, or there'll
be fire and murder."
Kaas was next to sta1te where his party stood. All
parties, or at least the 1najor ones, had made unified
voting by their "fraction" mandatory. Kaas, prevented
by Hitler's uniformed fonmations from going to his office
and, unable for the same reason to call his "fraction"
together for a final caucus, had to decide what to do
and thereby commit seventy-three votes one way or the
other.
The Centrist leader a1nid a hushed silence declared
his party would vote for the Enabling Act. Hitler had
his two-thirds majority.
How explain Kaas' action? Evidently he had hoped
the Reichstag could retain at least a modicum of its
constitutional powers. As: yet the depravity of the Nazi
leader and his lieutenants was not completely realized.
Moreover, Kaas, a Jesuit prelate, had heard Hitler de-
clare in his opening argument on the Enabling Act that
"the national government regards the two Christian de-
nominations [Konfessionen] as the most important fac-
tors for the preservation of our national character
[Volkstum] ." Hitler had once again been careful to pre-
sent himself in a conciliatory role:
151
 TYCOONS AND TYRANT

The government will only make use of these powers in

so far as they are essential for carrying out vitally necessary
measures. Neither the existence of the Reichstag nor that
of the Reichsrat is menaced. The position and rights of the
President remain unaffected. It will always be the foremost
task of the government to act in harmony with his aims.
The separate existence of the federal states will not be done
away with. The right of the churches will not be diminished,
and their relationship to the state will not be modified. The
number of cases in which a compelling necessity exists for
having recourse to such a law is in itseH a limited one. All
the more, however, the government insist upon the passing
of the law. They prefer a clear decision.1
A full, unrestrained dictatorship was now Hitler's.
The brief political honeymoon was over.
7. The English text is taken from Norman H. Baynes, The Speeches
of Adolf Hitler {London and New York; Oxford University Press),
I., 420.

152
CHAPTER EIGHT

~~ Gleichschaltung"
of German Industry

From the moment the Nazis took over, a little-known

word appeared in speeches, ordinances, decrees, edi-
torials, and letters. The Nazis had a veritable mania for
Gleichschaltung. Its meaning soon became evident:
everything in Germany, every phase of human life and
endeavor, every profession, every trade, even every
organization of stamp collectors or bird lovers, was to
be cast in the same mold. The very Fuhrer who had
preached to the industrialists that personality and indi-
vidual initiative must replace the "collectivism" of the
Weimar Republic now insisted that there was only one
way of life to be tolerated, only one interpretation of
one's calling or job permitted-the Nazi way, the Nazi
interpretation. Everything must be gleichgeschaltet.
I recall being invited to attend the opening of a Nazi
artists' club in Berlin, in the course of which the new
Fuhrer for the musicians attacked the old French motto,
~~L'art pour l'art" ("Art for Art's Sake"). Art, he stipu-
lated, like every other manifestation of human life, has
no right to exist for its own sake; it can exist only for
Nazism's sake, and must therefore be gleichgeschaltet.
I could not refrain from saying to a party member sit-
153
 TYCOONS AND TYRANT

ting next to me, after the speaker had finished, "But do

you think genius can ever be pressed into the same mold
as an ordinary person~? Is it conceivable to think of a
gleichgeschaltet Beethoven?"
To which this man, ,who was soon to become a justice
of the Supreme Discipllinary Court, replied, ccWell, then
we11 simply forego having a Beethoven.n
During the first three months of their regime, the
Nazis were rather cautious about German industry. They
seemed aware that they could not simply destroy a struc-
ture built up in decades of successful endeavor. They
also noted that German industry had excellent credit
and valuable connections in all parts of the world. The
success of Hitler,s chancellorship depended upon the
continuance of German exports. Accordingly, some ty-
coons were placed on the list of Reichstag candidates
without being asked for their consent. It was considered
clever Nazi politics to convey the impression of living
in harmony with the men who kept the German economy
going.
German industry,s central organization was the
Reichsverband der deutschen I ndustrie ( Reichsverband
for short) which had its counterpart in the National
Manufacturers Association of America and the Federa-
tion of British Indusbies of the Empire. Its thirty-six
directors, seven of the:m representing the heavy indus-
mes, were chosen as rtepresentatives, not of their firms,
but of their respective: branches of industry.
The Reichsverband at the time was headed by Gustav
Krupp von Bohlen und Halbach. He had been persuaded
late in 1931, during the Great Depression, to lend the
prestige of his name and firm to the honorary office of
president. All accounts agree that he was most reluctant
to accept. "It isn,t my line,n he said. "I don~t like to speak
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~' GLEICHSCHALTUNG '' OF GERMAN INDUSTRY

in public. I'm just not cut out to be the presiding officer

of so responsible an organization."
He evidently knew hiinself better than those who, like
Carl Duisberg of IG Farben, his predecessor, finally
overcame his misgivings by appealing to his sense of
duty. Often later he said to his most intimate associates,
"If only I hadn't taken it!"
Hindenburg's appointnaent of Hitler as chancellor was
quite a shock to him. But now his ingrained respect for
legality and authority once again asserted itself. Hinden-
burg had acted within ]~is constitutional rights in en-
trusting the highest political office to the leader of the
largest political party. F'rom now on Adolf Hitler was
the constituted authority to Krupp, and there was only
one thing to do, namely, to obey that authority. To him
this was not an about-face, but rather a self-evident
consequence of a changed political situation which de-
manded a change of loyalty. From now on he must be
loyal to Hitler-of this there was no doubt in his mind. 1
The directors of the Reichsverband were by no means
all of the same politica]l persuasion. There were anti-
Nazi bitter-enders like C;lemens Lammers, representing
the paper industry, and Georg Miiller-6rlinghausen,
representing textiles; middle-of-the-road compromisers
like Albert Vogler of lUnited Steel and Krupp von
Bohlen; ardent Nazis Hke Fritz Thyssen and Albert
Pietsch. All were united, however, in their dread of
socialization and of com1munism.
In the first session o.f the Reichsverband directors
after Hitler's seizure of power, on February 17, 1933,
nobody was in a position as yet to evaluate what all this
would lead to, nor, in fact, what it was. The new gov-
ernment was still looked upon as a parliamentary one,
1. Cf. Chapter Three, p. 3~~.
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 TYCOONS AND TYRANT

in which the Nazi party was merely the strongest. Inas-

much as a number of the directors had been summoned
by Goring to a meeting for ten days later in Berlin, and
as the purpose of this meeting, according to the invi-
tation, was to ccdiscuss economic questions," it was de-
cided to adjourn until the situation had clarified.
The second meeting was scheduled for March 23, the
day on which the Enabling Act was passed. It began
with a bitter attack on Bohlen and the executive director
of the Reichsverband, Geheimrat Ludwig Kastl, by Fritz
Thyssen for having shown crass political shortsighted-
ness in remaining aloof from Nazism all these years.
Clemens Lammers riposted that the continuation of free
enterprise was at stake and that it was the duty of the
Reichsverband to seek to preserve it.
The upshot of this clash of views was that a committee
headed by Lammers was appointed to draft a set of
principles for which the Reichsverband would stand in
view of the changed political situation, and that Krupp
von Bohlen and Carl Friedrich von Siemens were desig-
nated to seek a personal interview with Hitler.
Also, Dr. Kastl and his deputy, Jacob Herle, were
authorized to write Hitler, offering the co-operation of
the Reichsverband in the regeneration of Germany. It
was a strictly factual letter. Dated March 24, 1933, it
read:
The elections have supplied the basis for a stable govern-
ment and have thereby removed the disturbances which
resulted from the constant political fluctuations of the past
and which paralyzed economic initiative. To make possible
the necessary and energetic reconstruction of our country
it is essential that all elements which are willing to assist
in this task coordinate their efforts and cooperate with each
other. German industry, which considers itself an important
and essential factor for our national regeneration, is ready
156
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GLEICHSCHALTUNG OF GERMAN INDUSTRY

to cooperate effectively in the solution of this task, and the

Reich.roerband der deutschen I ndustrie, as its political rep-
resentation, will do everything possible to assist the Reich
government in its arduous task.
Five days before the Fuhrer received Krupp and
Siemens, representatives of the new government held
their scheduled meeting with a large group of tycoons
to discuss questions of economic policies and economic
organization. The government delegation urged simpli-
fication or consolidation of the numerous economic or-
ganizations. This looked like a reasonable proposal
which business and industry could handle through their
own organs of self-government.
The meeting of Bohlen and Siemens with Hitler on
April 1 appears from all accounts to have consisted in
the usual monologue by the Fuhrer which left no time
for discussion. It led to nothing concrete. But once again
Krupp von Bohlen was C2Lptivated by the persuasive per-
sonality of the Nazi chieftain.
Even as he was listening to the chancellor, however,
the first blow was struck at the Jews-a general boycott
which, although this tirne without implications of vio-
lence, nevertheless showed that Hitler meant to put his
anti-Semitic program through.
In Cologne, the mob called for the removal of Paul
Silverberg, president of the Cologne Chamber of Com-
merce, who represented the lignite coal interests in the
Reichsverband directorate. In Berlin, the withdrawal
from the Reichsverband board was demanded of Ed-
mund Pietrkowski, representing the chemical industry,
Hans Kramer, representing color printing, and Ernst von
Simson, of IG Farben. A.t the same time the Reichsver-
band was confronted by an ultimatum that Geheimrat
Ludwig Kastl, the executive director, must resign be-
157
 TYCOONS AND TYRANT

cause he was a ccreactionary." He had refused to display

the swastika Hag on the opening day of the Reichstag.
Otto Wagener, whom Hitler had entrusted with cer-
tain economic functions without, however, clearly de-
fining them, entered Kastl's office with his right-hand
man, Hans von Lucke, and with a German National
business leader named Alfred Moilers, and demanded
that the Reichsverband give visible evidence of its readi-
ness to adjust itself to the new situation. When Kastl
inquired wherein this visible evidence was to consist,
the trio put forth three concrete demands: removal of
all Jewish members from the board of directors, the res-
ignation of Kastl, and the establishment of a regular
liaison with the 'cnational movement.,
Kastl insisted he had no authority to act on his own
and tried again and again to reach Bohlen who, at that
moment, however, was closeted with Hitler. The three
emissaries then threatened to have the general offices
of the Reichsverband .occupied. To gain time, Kastl
agreed to remain inactive until the next session of the
board of directors. During luncheon hour he visited
Economics Minister Alfred Hugenberg who seemed
worried but would take no action. Bohlen when finally
reached refused to become excited, opined things would
straighten out all right in due time, approved of Kastl's
decision temporarily to withdraw from the management
of the Reichsverband, and agreed to have von Lucke
and Moilers act as liaison officers. He returned to Essen
the same day.
With the benefit of hindsight, Krupp's critics state
vehemently that he should have turned on his heels the
moment he was informed and gone back to the chancel-
lor's palace to demand another interview with Hitler
which, if unfavorable, should have been terminated by
his resignation. This resignation, they hold, would have
158
'' GLEICHSCHALTUNG '' OF GERMAN INDUSTRY

alerted the world to the dangerous course that the Third

Reich was pursuing.
His defenders, on the other hand, argue that the deli-
cate situation demanded patience and forbearance, and
that Bohlen alone could not do much, whereas joint
action by the full directorate might yet save the day.
Von Bohlen's situation was rendered additionally dif-
ficult by a mendacious eommunique which the NSDAP
publicity department now sent to the German press. It
claimed that the Priisidium (meaning the president, the
vice-presidents and the executive director) of the
Reichsverband had taken the following decision:
Dr. Hans von Lucke, a:s confidant ( V erlrauensmann) of
the NSDAP, and Alfred !vfollers, member of the Reichstag
and chairman of the Organization for a National Economy
and Working Unity, as confidant of German National eco-
nomic circles, have been received provisionally into the
executive management of the Federation of German Indus-
tries. The Pri:isidium and 1the executive management of the
Reichsverband are to undlergo a change of personnel. The
request of Geheimrat Kastl, until now a member of the
Pri:isidium as executive diirector, to go on leave has been
granted.
This announcement, 'with which the Nazis created
another fait accompli, vvas sugar-coated by a warning
to individual groups of Nazis that they must act only
in close collaboration with Lucke. But this was a mere
sop. Individual excesses:, especially against Jewish un-
dertakings, continued and it soon became obvious that
Wagener was not nearly as close to Hitler as he claimed
to be. He was in no position to check, for instance, the
Gobbels-controlled press, which denounced the Reichs-
verband as "liberalistic, Jew-infested, capitalistic, and
reactionary."
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 TYCOONS AND TYRANT

Bohlen hastily summoned the board of directors for a

meeting on April 6. He reported on the situation, includ-
ing his acquiescence in the appointment of Lucke and
Moilers as provisional liaison officers.
To everybody's surprise, of all directors the No. 1
industrialist Nazi, Fritz Thyssen, objected. Wagener and
his men, he argued, had absolutely no right to interfere
with the Reichsverband, and that industry must reject
all such ~~wild actions.'' As one who had attended the
March 27 meeting he insisted that the government had
agreed to postpone final action on industrial organization
until after an official commission had studied the entire
question during the ensuing six months. Albert Vogler
of United Steel and Carl Kottgen of the Siemens Con-
cern confirmed Thyssen's understanding.
This placed Krupp von Bohlen in an embarrassing
position. He had already made certain concessions and
commitments to Wagener and his men and felt he could
not as a matter of honor and integrity go back on his
word. Answering Thyssen he admitted having been in
ignorance of some of the facts presented, having erred
in the evaluation of other facts, and possibly having in
consequence taken some wrong steps. There was only
one thing to do, he declared: to resign as president.
But that was the last thing his fellow board members
wanted at this juncture. The resignation, they pointed
out to him, would be interpreted as indicating that he
stood on the side of illegality in contrast to his thirty-five
colleagues who were fighting the illegality of Wagener
and his men. It needed the combined efforts of Mi.iller-
Orlinghausen, Siemens, Lammers, Thyssen, Bucher, and
Friedrich Springorum to persuade Bohlen, who could be
very stubborn at times, to withdraw his resignation.
A communique then was issued calling attention to
160
' ' GLEICHSCHALTUNG ' ' OF GERMAN INDUSTRY

the agreement of March 27 with the government, and

stating that Krupp von Bohlen had been unanimously
empowered "to maintain the necessary contact with the
chancellor, the federal government and such persons as
might be designated by chancellor and government."
All matters dealing with organization problems, includ-
ing questions of personnel, would be handled within the
agreement of March 27.
That seemed to put Messrs. Wagener, Lucke and
Moilers in their places. Jacob Herle was able a little later
to report that the two liaison men were "attending only
to their own personal matters" in the rooms of the
Reichsverband. But-they were still there.
Meanwhile the Lammers committee had completed
its work and reported its findings to Bohlen.
On April 25 Bohlen submitted his own ideas for the
reorganization of the German industrial self-government
bodies to Hitler. They were largely based on those of
the Lammers special committee. In an accompanying
letter he stated that the Reichsverband was animated
by a desire to simplify the organizations representing
industry, but also by a readiness "to incorporate the
leadership principle into industry's representative
bodies." Here, his critics say, he overstepped his author-
ity; he had no right to commit his fellow directors to
the leadership principle ( Fiihrerprinzip ).
His proposals may be summed up as follows:
1. The simplification of government administration by
reduction of the bureaucratic apparatus should be paral-
leled by a similar simplification of the administration of
industrial organizations.
2. Economic common sense and political necessities
should be brought into consonance with each other.
3. The new organization of German industry should
become an effective instrument of industrial enterprise.
161
 TYCOONS AND TYRANT

To achieve that end it must remain free and self-gov-

erning.
Three days later Adolf Hitler once more received
Gustav Krupp von Bohlen. Exactly what happened
when these two men faced each other alone may never
become known. Did Bohlen once again fall under the
hypnotic influence of the Fuhrer? Did all critical anal-
ysis then leave him? Was he at all given a chance to
present the viewpoint of the Reichsverband directors?
Did he even attempt to do so? If yes, did Hitler threaten
Bohlen as he later did Chancellor Kurt von Schuschnigg
of Austria, President Emil Hacha of Czechoslovakia, or
King Leopold III of Belgium? The Enabling Act had
meanwhile been passed and Hitler could make good any
threat he pleased.
If indeed he threatened, what did the new dictator
say he would do? Arrest von Bohlen? That would not
have intimidated the head of the Krupp Concern. He
had voluntarily returned to Essen during the French
occupation after World War I, as we have already seen,
in the certain knowledge that he might be arrested. Seize
the Krupp plants? That was a formidable threat indeed.
Bohlen,s entire mature life had been devoted to preserv-
ing the Krupp industrial empire for the family into which
he had married. Dissolve the Reichsverband? He was as
committed to its preservation as he was to that of the
Friedrich Krupp Co., Ltd. He would rather have cut off
a hand than willfully betray a trust. Socialize industry?
To forestall such a calamity he might have felt justified
to make far-going concessions.
Or did Bohlen believe, as so many others did, that it
was better to bow before the storm in the hope it would
soon blow over? Did he reason, as men like Foreign
Minister Konstantin von N eurath-and there were many
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GLEICHSCHALTUNG ' ' OF GERMAN INDUSTRY

of them-did, that it was better to stick to one's post,

even though it meant compromise and conflict of con-
science, in order to prevent the radicals from taking
over? 2 CCUm Schlimmeres zu verhiiten'' ("To prevent
something worse from happening") -was that what ran
also through the Essen magnate's mind as he conferred
alone with the now mightiest man in western Europe?
We shall never know the answer. I have made every
effort to penetrate this darkness; to no avail. Bohlen was
an unusually uncommunicative person.
What we do know, however, is that the following
significant communique, issued without clearance by
either Krupp von Bohlen or the Reichsverband direc-
torate, appeared in the newspapers of May 4:
Following the interview which the Reich Chancellor
granted the President of the National Federation of German
Industries, Dr. Krupp von Bohlen und Halbach; following
the appointment by Federal Economics Minister Dr. Hugen-
berg of Messrs. Otto Wagener and Alfred Moilers, member
of the Reichstag, as federal commissars for the National
Federation of German Industries as well as for the rest of
the German economy with the exception of agriculture; and
following Dr. Wagener's nomination of Dr. von Lucke as
his deputy for matters connected with the National Feder-
ation, this Federation now publishes the following decla-
ration:
In conformity with the principles of the national govern-
ment, and at the same time in the interest of carrying out
the tasks facing the Reichroerband in a unified and rigid
manner which will in future prevent all individual moves,
the leadership principle will become effective in the follow-
2. Von Neurath visited American Ambassador Frederick M. Sackett
soon after accepting appointment to the Hitler cabinet to explain to
him that he was remaining in the government at the expressed wish
of President von Hindenburg in order to prevent a Nazi from filling
this important post.
163
 TYCOONS AND TYRANT

ing manner for the entire organization of industrial asso-

ciations :
In accordance with the decision of the Priisidium of April
6, whereby the president, Dr. Krupp von Bohlen und Hal-
bach, was unanimously empowered to prepare and carry
through the measures for simplifying and reorganizing the
industrial organizations, Mr. von Bohlen will use the ex-
traordinary powers granted him to :
1. Harmonize the economically desirable in the realm of
industrial organizations with the politically necessary;
2. Bring the new organization into consonance with the
political aims of the federal government and at the same
time render it so rational and powerful that in conformity
with the importance of industry it can become an effective
instrument of industrial economy within the framework of
the national, social and economic reconstruction.
This dual task encompasses not only the founding of a
new National Federation of German Industries (i.e., espe-
cially the carrying out of all necessary measures affecting
organization and personnel), but also includes the vast com-
plex of questions as to how the economy shall be subdivided
vocationally. The principal aim of economy and industry
in this connection must consist in eliminating all over-organ-
ization and in making the organization as simple and effec-
tive as possible, yet at the same time following most closely
in the footsteps of what is already in existence and preserv-
ing the valuable asset of free seH-govemment. Special advi-
sory committees are to be appointed for study of the various
problems, such as organization, vocational structure, ethical
concepts (which are indispensable also for economic life),
fiscal and credit policies, and taxation.
In recognition of the leadership principle Mr. von Bohlen
will personally become chairman of all committees, with
the proviso that he may name deputies, and will assume
responsibility for all decisions.
Upon conclusion of further negotiations with the federal
commissars and upon completion of the formulation of a
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GLEICHSCHALTUNG OF GERMAN INDUSTRY

final plan for the reorganization of the industrial organi-

zations, the bodies affected will be called together for a
special session.
I have quoted this lengthy and rather dry commu-
nique because of its far-reaching implications and to
point up that prevarication had been a principal weapon
of Nazism all these years.
There was no truth whatever in the statement that the
Reichsverband had published the declaration which
forms an essential part of the communique. No meeting
had been held of the Priisidium or the board of directors.
The first they knew about it was when they read it in
the newspapers.
It was also an untruth to claim that Krupp von Bohlen
"was unanimously empowered to prepare and carry
through" the reorganization. He was merely empowered
"to maintain the necessary contact" with the powers-
that-be. Not a word was said by the directors to indicate
he had power to commit his organization. In any case,
six months were to be devoted to study before any plan
of reorganization was to be put into effect.
The far-reaching consequences included :
1. The ~'provisional liaison men" were designated as
legally appointed permanent commissars. From the Nazi
viewpoint this meant that they were now the real mas-
ters of the Reichsverband. The board of directors was
powerless to remove them.
2. Krupp von Bohlen agreed to introduce the auto-
cratic leadership principle ( Fiihrerprinzip) into indus-
try in contravention of all tradition and in misinterpre-
tation of the mandate given him by his colleagues, there-
by abandoning the principle of self-government which
had thus far guided the representative organizations of
industry.
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 TYCOONS AND TYRANT

3. The capitulation by one of the most powerful

groups in German life before the power-seeking Nazi
bullies had a devastating effect upon the hopes of other,
less strong, organizations representative of other interests
in German life. These organizations kept hoping that
Gleichschaltung might yet be averted by united action.
It must be remembered that President von Hindenburg
was still alive and could act as a brake on Nazi tyranny.
Also, the cabinet was still composed of a majority of
non-Nazis.
On May 2 the great German trade unions had folded
up without an attempt at resistance; now, two days later,
announcement was made that their opposite number,
the largest of employers:. organizations, was about to go
out of existence also.
The board of direcltors of the Reichsverband never
met again. On May .22 its members were asked by
Bohlen as the new Fuhrer of industry to hand in their
resignations. Jacob Herle, who had succeeded Geheim-
rat Kastl as executive director, has stated that further
meetings of the old directorate were forbidden. One
wonders what would h:ave happened if it had met never-
theless to declare before the world that the communique
of May 4 was a fraud, and that Krupp had acted under
duress. Their failure 1to do so spelled the end of the
Priisidium, the board of directors, and the large Haupt-
ausschuss or main con1mittee.
Krupp von Bohlen:.s reorganization scheme was never
put into operation. U uder orders from the ministry of
economics, from which Dr. Hugenberg was booted out
on June 27, 1933,8 he created a new organization, the
3. Hugenberg had laid himself open to world criticism by a memo-
randum which he distributed surreptitiously to the press during the
World Economic Conference in London in June 1933, where he was
a member of the German delegation. In this memorandum he de-
166
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GLEICHSCHALTUNG '' OF GERMAN INDUSTRY

Reichsstand der deutschen I ndustrie (Reich Corpora-

tion of German Industry), in which the old Reichsver-
band was to constitute the politico-economic section and
the old Association of German Employers' Federations
( V ereinigung der deutschen Arbeitgeber-V erbiinde)
the socio-political section. But he had no sooner an-
nounced it with Hitler's approval, than Commissar Wage-
ner served notice that this new creation would be pro-
nounced null and void unless workers' organizations
were also included. The old trade unions, it should be
stated, after their seizure by Robert Ley were still func-
tioning after a fashion under Trustees of Labor. Before
this issue could be settled, Hitler's new minister of eco-
nomics, Kurt Schmitt, dismissed Commissar Wagener.
Besides, the German Labor Front, created by Ley, then
in process of formation, was soon to put an end to both
labor unions and employers' associations and to compel
workers and management to join this grotesque con-
struction as individuals.
On February 27, 1934, scarcely thirteen months after
the Nazis had taken over, the last vestige of Bohlen's
conception of a reorganized Reichsverband disappeared.
The Hitler government promulgated a Law for Prepar-
ing the Organic Superstructure of German Economy.
Schmitt was given dictatorial powers to build it. He de-
cided to do away with all existing organizations and to
group Germany's vast gewerbliche W irtschaft, meaning
dared bluntly that Germany would be compelled to seek Lebensraum
(living space) in the Ukraine. Foreign Minister von Neurath, head
of the German delegation (on which, it is interesting to note, labor
was not represented), demanded his immediate recall. From then on
Hugenberg's days in the cabinet were numbered. Der Fuhrer was
happy to be rid of another non-Nazi. In his place he appointed an-
other capitalist, Kurt Schmitt, head of a large insurance concern in
Munich. A personally decent man, Schmitt proved to be a melancholy
puppet of the regime.
167
 TYCOONS AND TYRANT

all phases of German e•conomy that had to do with busi-

ness, trade, manufacture, and industry, under twelve
heads, of which the firs1t seven were to embrace industry.
Number one of these seven industrial subgroups was
to comprise mining as vvell as steel and metal production.
Krupp von Bohlen was appointed Fuhrer of this first
group only.
Thus the president and later Fuhrer of the most pow-
erful industrial organization in Germany, if not in all
Europe, met the fate ·which dictators usually have for
those who Hdo not belong," but whom they find it con-
venient to use for a wrhile. He was demoted to leader
of only one out of seven industrial groups, which in turn
became but the major half of a superorganization of
twelve groups. Each of the Fuhrer of the twelve groups
had above him the higher ranking Fuhrer for the entire
superstructure, Philipp Kessler, head of the National
Federation of the Electro-Industry, and his deputy,
Count Rudiger von der Goltz. These two superstructure
Fuhrer, in tum, had ?\1inister of Economy Schmitt as
their superior Fuhrer.
Bohlen felt grievously hurt at the deal given him.
He had acted in good faith according to his lights in
accepting the role of Fuhrer of German industry, and
meant to use that role to retain just as much autonomy
for industry as possible. Instead, he found totalitarian-
ism hemming in indus:try on all sides. It was not long
before he resigned. On December 17, 1934, his successor
took over.

Whatever may have been the merits of Krupp von

Bohlen's tactics vis-a-v•i,s a situation which no German or
any other industrialist before him had had to face, now,
with hindsight as our guide, we can only state that his
compliance with Hitler's orders and the failure of the
168
''
GLEICHSCHALTUNG
,, OF GERMAN INDUSTRY

Priisidium of the Reichsverband to convene in protest,

even at the risk of arrest, wrote finis under German in-
dustrial autonomy.
Hermann Bucher of the AEG, who had known Gustav
Krupp von Bohlen intimately for many years, wrote as
follows on March 12, 194:8, in retrospect:
Gustav Krupp von Bohlen was president of the Reichs-
verband der deutschen Industrie at a decisive time. He was
universally respected not only as head of the House of
Krupp, but as an individual human being.
He possessed a pronoun•ced sense of duty, was affable,
courteous, well mannered, just, and incapable of intrigue,
in short, he had all those human virtues that are part and
parcel of a man of honor.
In normal times he was an outstanding president. He was,
however, not equal to meeting the conditions that devel-
oped in 1932/33. He was not a typical entrepreneur. He
found himself unable to s:hake off his bringing-up in an
Obrigkeitsstaat 4 and in his former career [of diplomat].
Instead, he considered hiinself-as he himself frequently
expressed it-the trustee of Jbis wife's fortune and the guard-
ian of the Krupp tradition. Although stubborn and seldom
influenced by third parties, he was not a fighter by nature.
After Hitler had attained power he subordinated himself
to him despite the fact that, as I know personally, he had
previously had no use for him. His was a tragic fate.
4. Meaning a state in which the government, the constituted au-
thority ( Obrigkeit), is supreme.

169
CHAPTER NINE

Disillusionment at Home;
Cheers Abroad

,-he unlimited powers conferred upon Adolf Hitler by

the Enabling Act were evoked with stunning rapidity
and soon led to widespread disillusionment. One prom-
ise after another was broken.
For instance, the Nazis had proclaimed again and
again that no civil servant should have a salary of more
than RM 1,000 (about $240) per month. Now leading
Nazi officials were not only receiving fat salaries, but
lavish expense accounts, plus the use of official cars and
luxurious homes.
Again, Hitler had promised to refrain from interfering
with the two Christian faiths-the Protestant and the
Catholic. Only a few months later over one thousand
clergymen were detained in concentration camps and
many churches were closed.
Nazi spellbinders had berated the guilds and trade
unions for not paying enough attention to apprentice-
ship, with the result, they claimed, that the German
H andwerk-the profession of handicraft-had lost its
reputation for excellence of workmanship. I recall how
my Berlin barber, who always prided himself on his ex-
acting training of his young assistants, returned enthusi-
170
 DISILLUSIONMENT AT HOME

astically from a meeting o:f his guild early in 1933 during

which a Nazi speaker had promised that handicraft
would rise to new heights under Hitler. It took only a
few weeks to disillusion him.
"Imagine," he said to n1e in disgust, ccthe head of our
guild, a man who came from the ranks of the barbers
like the rest of us, has been fired and a Nazi put in his
place! Well, I wouldn't tnind that if he were a better
man. But he's a former chauffeur who now suddenly
poses as our Fuhrer!"
Hitler had closed his first Reichstag speech with an
appeal to all people of good will to help in the rearing
of a new Germany. Thousands upon thousands of Ger-
mans took him at his word, only to find that they were
not wanted; membership in or pull with the Nazi Party
was necessary to obtain a good position.
The Hitler government had been distinctly appointed
as a coalition cabinet. Also, it was understood that the
existing political parties would continue to func-tion.
Hitler's first blow-the Reichstag fire-knocked the Com-
munist Party out of existence. In June 1933, the Social
Democratic Party was banned as an enemy of people
and state. Consistent pnessure applied to the Demo-
cratic, German People's and Centrist Parties resulted in
their folding up ccvoluntarily" in June and July. A series
of arrests of German National leaders made even Alfred
Hugenberg, coalition calbinet member for almost six
months, see the light and his party, too, vanished. On
July 14, Hitler issued a decree to the effect that the
Nazis were the sole politilcal party of Germany and that
the formation of any other party would be punished
heavily.
The list of broken protnises could be extended indefi-
nitely. Historians have c:atalogued them impressively.
Suffice it to say that the:se breaches of faith, together
171
 TYCOONS AND TYRANT

with such lawless acts as the Reichstag fire, the boycott

of Jewish stores and professional offices, the arrests with-
out warrants of thousands of dissenters on the flimsiest
charges, the suppression of many newspapers, the vic-
timization of the trade unions, and the wanton inter-
ference of the Nazis with every phase of human life
made many a thoughtful German shudder. The year
1933 marked not only the beginning of the Nazi regime,
but also of the movement to resist and abolish that re-
gime which culminated in the ill-fated attempt on Hit-
ler's life on July 20, 1944.
It would be folly to claim that this disillusionment
was general. As already pointed out, Hitler had cleverly
taken over the plans of his predecessors for job creation.
Hundreds of thousands of dole recipients were back at
work. For their leisure time a huge organization, Kraft
durch Freude (Strength through Joy), was created
which offered cheap entertainment, reduced-fare excur-
sions to interesting places abroad, and inexpensive vaca-
tions at choice resorts at home. While one often heard
complaints that there was too much regimenting of the
individual's leisure time, yet for many who had never
left their home surroundings the Nazi-sponsored trips
were a welcome change.
In the realm of industry it was especially the techni-
cians who were slow in recognizing what a heinous evil
Nazism really was. The reason was obvious: in a regime
in which money is no object, the architect, engineer,
inventor, or industrial scientist whose specialty coin-
cides with the needs of the regime can suddenly come
into his own and realize dreams which were hitherto
impossible of fulfillment because the financial support
was wanting. Men of this type are so obsessed with the
importance of their work that they will accept whatever
form of government enables them to carry on and de-
172

..,.,
 DISILLUSIONMENT AT HOME

velop their life's work. Mutatis mutandis, this was also

the psychological spur which in many instances ren-
dered the military amenable and even devoted to the
Nazi Party.
Paradoxically, the two leading industrialists who had
been Hitler's most ardent supporters in the days of his
struggle were among the first of their profession to be-
come disillusioned. Emil Kirdorf became so incensed
over the removal of his Jewish friend, Paul Silverberg,
from the presidency of the Cologne Chamber of Com-
merce 1 that he promptly invited himself as Silverberg's
house guest for a number of days, thereby demon-
strating his disagreement with Nazi anti-Semitism. He
followed his action up with a letter addressed to the
Rheinisch-W estfiilische Zeitung of Essen, from which
the following is quoted:
I regard the inhuman extent of continued anti-Semitic
persecution as a crime. A large number of persons who
served Germany well, and whose families have been citizens
here for centuries, have been dishonored in a cruel manner
and the ground taken from under their feet. . . . The stab
in the back which these valuable people received has been
a stab at me also. My hope, my faith is now gone of living
to see the day when we shall have a new, spotless, proud
Germany.
Fritz Thyssen, as also indicated, 2 had become an ar-
dent Nazi partly because he believed that Hitler would
create a form of government known as the Stiindestaat,
or corporate state, a state in the parliament of which
members would sit, not according to geographical loca-
tion or political party, but according to callings and pro-
fessions and trades. Such a Stiindestaat had been advo-
1. Cf. Chapter Eight, p. 157.
2. Cf. Chapter Three, p. 76.
173
 TYCOONS AND TYRANT

cated, as already intimated, by Pope Pius XI in the ency-

clical ccQuadragesimo tJ~nno/, of May 15, 1931. As a faith-
ful Catholic, Thyssen 1lloped through Hitler to make the
Pope's suggestion become a reality.
Hitler encouraged hlim. He instructed him to go ahead
with his plans for founding at Dusseldorf an I mtitut
fur Stiindewesen (Institute for the Study of the Corpo-
rate State), the director of which was appointed in con-
sultation with Rudolf Hess, Hitler's deputy. It was to
become the research center for later setting up the
Stiindestaat. Once in power, however, Hitler lost all in-
terest in a corporate st:ate and his minister of economics,
Kurt Schmitt, publicly disavowed the idea. In due time,
Thyssen's institute director was interned in the Dachau
concentration camp.
Thyssen's disillusionment subsequently turned into
active resistance to Nazism and ended in his flight from
Germany and in the confiscation of his huge fortune by
the man on whom in the course of years he had spent
approximately one mi1!lion marks. 8

Another big industriialist who at an early stage recog-

nized the disastrous game that Der Fuhrer was playing
was Ernst Poensgen, chairman of the board of United
Steel. He never fell under Hitler's spell. As he often put
it, "That man leaves 1ne completely cold." But he did
believe that the industrialists should, "um Schlimmeres
zu verhuten,'' accept posts within the Nazi administra-
tion of German econorny as long as that was possible.
When he realized th:at the Reichsverband der deutsch-
en Industrie had been gleichgeschaltet-brought into
conformity with Nazi totalitarianism-he quietly organ-
3. Sproch und Begriindum.g im Spruchkammeroerfahren gegen Dr.
h.c. Fritz Thyssen, p. 17.
174
 DIS ILL USIONl~ENT AT HOME

ized what became known as the Kleine Kreis, or small

circle, a group of seven rnanagers of the leading steel
concerns in the Ruhr. Its members were himself for
United Steel, Wilhelm Zangen for the Mannesmann
Rohrenwerke, Peter Klockner (and later his son-in-law,
Gunther Henle) for the Klockner Concern, Friedrich
Flick for the Friedrich Flick Kommandit-Gesellschaft,
Hermann Reusch (later c :eorg Li.ibsen) for Cute Hoff-
nungshi.itte, Arthur Klotzbach (later Ewald Loser) for
Krupp's, and Erich Tgahrt for the Hosch Concern.
The Kleine Kreis met about once a month to discuss
matters of common interest. In the confusion created
by inefficient and inexperienced Nazi commissars there
were many questions that needed confidential discussion
so as to preserve at least a :modicum of autonomy for the
steel industry. No records were kept, no resolutions
passed, no binding agreennents signed. It was all done
on a social basis of men with like interests meeting each
other informally, but it proved effective in putting a
brake on some of the wild projects which the Nazis tried
to advance.
On one matter all were agreed, namely, that the pro-
posed erection of the Hermann Goring Werke at Salz-
gitter represented unsound economics. The Ruhr indus-
trialists had for years had experts at work to determine
what might be done about the rather poor iron ore avail-
able in the Salzgitter region. Germany must import most
of her iron ore, so that any deposits anywhere within
the land naturally were thoroughly examined as to their
quality. Paul Pleiger, Hitler's appointee to set the Her-
mann Goring Werke going, was of the opinion that the
low-grade Salzgitter ore could be smelted profitably.
Goring had secured the services of an American engi-
neer, Herman Alexander Brassert, to applv a process
175
 TYCOONS AND TYRANT

developed at Corbin, England, by which poor ore could

be vastly improved. The Kleine Kreis objected on the
grounds that the capital investment would be out of all
proportion to the possibilities of the money market at
the time. Goring solved this problem by compelling all
steel-producing concerns to acquire shares in the Her-
mann Goring Werke which they were later forced by
the regime to sell at a big loss.
It is not surprising that the Party after this conflict
with the Kleine Kreis was none too well disposed toward
its members. Poensgen was subsequently dismissed from
his job, to be followed soon by Reusch, Henle, and
Tgahrt.
The Salzgitter case illustrates the fundamental con-
flict between industry and the Nazis. Hitler's demand
that industry place itself unconditionally at his service
was incompatible with the desire of industry to safe-
guard the standards of sane management and sound,
honest finance.

Another group of which Poensgen was likewise a

member, was no less critical of the development of
Nazism. That was the so-called Ruhrlade, ~ an aggrega-
tion not limited to steel producers. It had been called
into life late in the 1920's at the suggestion of Paul
Reusch. Reusch believed that the leading men of the
Ruhr Valley ought to meet socially and informally from
time to time to get to know each other better and occa-
sionally, as circumstances demanded, to agree on joint
action.
4. Originally Lade meant a drawer or container, such as a chest,
for putting things in safe keeping. The expression Ruhrlade purported
to indicate, not without an undertone of slight scorn plus envy by
industrialists not invited into their exclusive circle, that this group
harbored secrets safely stowed away in their uncommunicative hearts.
176
 DISILLUSIONMENT AT HOME

The Ruhrlade membership at the time the Nazis came

into power consisted of Paul Reusch, Fritz Thyssen,
Gustav Krupp von Bohlen, Albert Vogler, Ernst Poens-
gen, Peter Klockner, Fritz Springorum, Arthur Klotz-
bach, Paul Silverberg, Hermann Winkhaus, and Carl
Bosch. Occasionally also Hermann Bucher and Carl
Friedrich von Siemens, Berlin industrialists, were in-
vited to attend.
The group was strictly unofficial. But what the Ruhr-
lade said and discussed exerted great influence. Natu-
rally, the numerous measures introduced by the Nazi
regime found critical analysis by these men who knew
the economic situation of Germany intimately.
Characteristically, its sudden end came in 1938 be-
cause of Krupp von Bohlen's loyalty to whatever govern-
ment was in power. At a meeting held in the home of
Carl Bosch, someone raised the question of the corrup-
tion that was spreading far and wide in Nazi circles.
Bohlen was not willing to believe that there could be
any corruption in a party headed by Adolf Hitler. He
rose angrily to say that he did not propose to listen to
charges of this sort, and left the gathering.
The others then realized that the time had come to
discontinue their get-together, since evidently free dis-
cussion was no longer possible. The end of the Ruhr-
lade had come.

Among the large industrial concerns of Germany

there were some with especially advanced human rela-
tions. Friction over social welfare matters soon devel-
oped between them and the new regime. What hap-
pened at the Bosch factory in Stuttgart was typical.
When I visited the Bosch automobile accessories plant
in 1953, a number of employees still recalled the resent-
ment which they all harbored when delegates of the
177
 TYCOONS AND TYRANT

German Labor Front came to tell the management how

the workers should be treated.
"We didn't need these men around," they said. "In
fact, everything they mentioned was already part of
our regular set-up and had been so for years. These
outsiders merely made trouble."
The attitude of the Bosch people was shared by the
workers and employees of a large number of German
industrial undertakings as well as by their owners and
managers. Enthusiastic at first over the thought that
V olksgemeinschaft, the one-ness of everybody identified
with a plant or undertaking, was to develop even fur-
ther under Nazism, employees and employers alike be-
came disillusioned when they learned that the good
human relations which had grown organically and by
voluntary association of workers and their bosses were
now supplanted by something commanded from above
and carried out on orders barked out as on the drill
grounds.
Robert Ley within my hearing expressed his idea in
these crass words in the course of an address in Berlin,
~~Die V olksgemeinschaft muss exerziert werden" ("Com-
munity spirit must be drilled").
Before this growing disillusionment could become a
danger to the regime, Hitler and his henchmen saw to
it that all power was concentrated in their hands. Re-
sistance became more and more difficult. The Gestapo
meddled relentlessly. This meant that many a German
in industry and elsewhere resigned himself to making
the best of the situation by lying low. It meant that,
while conforming outwardly, he would keep his inner-
most thoughts to himself, hiding them even from mem-
bers of the family, and remaining forever conscious that
the walls had ears and the telephones had Rimmler's
microphones.
178
 DISILLUSIONMENT AT HOME

It still remained possible occasionally to outwit the

Nazis. The leadership principle, though proclaimed by
Bohlen, was by no means carried through completely in
industry. The Kleine Kreis, for instance, agreed on meas-
ures for the management of their concerns which they
carried out irrespective of directives from the top. In
industries other than steel, similar understandings were
informally arrived at which gave the Nazi bureaucracy
no end of trouble. The expression, ~~Die Industriellen
sind ein Haufen von Frondeuren~~ 5 ("The industrialists
are a bunch of <anti's' ~') , could be heard daily in Robert
Ley's German Labor Front headquarters, as I know
from my own visits there.
Although anti-Semitism was at the core of Nazi faith,
it must be remembered that the extreme measures
against the Jews were not invoked until late in 1938.
It was still possible for Jews to get out from under.
Hence, during the first period of the Nazi regime, many
Jews, foreseeing the unspeakable cruelties of later days,
began to leave the country. As was convincingly proven
during the Niirnberg industrial trials, many industrial-
ists, far from seeking to profit from the fate of their
Jewish colleagues, bought them out at fair prices, when
these unfortunates could no longer retain their holdings,
and even arranged with the Reichsbank for the transfer
of the purchase money into foreign currencies.
Men like Carl Bosch, Friedrich Flick, Walter Roh-
land, Paul and Hermann Reusch, and Director Albert
Schafer of the Phoenix Tire Works fought tenaciously
to keep their Jewish assistants and technicians, and for
a time succeeded. At Augsburg, in the administration
building of the M.A.N. ( Maschinenfabrik Augsburg-
5. "Frondeur" is an adaption of the French "fronde," a political
party during the minority of Louis XIV which opposed the govern-
ment and the court party.
179
 TYCOONS AND TYRANT

Niirnberg), noted for the manufacture of machinery for

naval vessels, the confidential secretary, a Jewess em-
ployed in a highly sensitive position, was retained
throughout the regime. This was, however, an excep-
tional case.
With the Enabling Act Hitler had legally become
Germany's undisputed dictator. Even so he did not go
into full gear immediately. For a considerable time
longer he continued to compromise in order to keep the
intricate economic machinery of the Reich running. This
was true even after he had quelled the alleged conspir-
acy of his most intimate friend, Ernst Rohm, head of
the brown-shirted SA ( Sturm-Abteilungen, i.e., Storm
Troops) on June 30, 1934. But while, terror-stricken,
nobody dared to question his rule, he engaged in new
and stringent acts of usurpation. He informed the as-
sembled Reichstag that he had taken over the functions
of the legislature as well as the judiciary, a clear viola-
tion of his oath of office.
This shock treatment seemed to condition the German
people for letting an equally appalling act of tyrrany
go unchallenged only a month later. President von Hin-
denburg's convenient death on August 2, 1934, embold-
ened the Fuhrer to declare himself both chief of state
and chancellor and by a surprise move to exact a per-
sonal oath of allegiance from the anned forces.
The decrees legalizing Hitler's usurpation bore the
signature not only of Hitler's radical party friends who
were members of the cabinet, but also those of the con-
servatives upon whom industry had counted to save
them from totalitarianism: Franz von Papen, Konstantin
von Neurath, Count Lutz Schwerin von Krosigk, Gen-
eral Werner von Blomberg, and Hjalmar Schacht.
Many Germans of good will, including a proportion-
180
 DISILLUSIONMENT AT HOME

ate number of industrialis:ts, were now caught in a trap

from which there seemed to be no escape. This was true
especially of those who, in the first enthusiasm of the
political honeymoon whi~ch followed Hitler's appoint-
ment as chancellor, and in reliance on his glib promises,
had joined the Nazi Party. They now found that it was
next to impossible to resign from it, unless one was will-
ing to become a martyr and head for a concentration
camp. Many decent men of high principles thus found
themselves-to change the figure of speech-enmeshed
in a monstrous web into '.vhich they had walked full of
hopes and ideals.

Hitler's true attitude to,.vard the German industrialists

was revealed in December 1936. He called them to-
gether in the former House of Lords in Berlin to enlist
their support for Hermann Goring's Four Year Plan for
Economic Self-Sufficiency. The address was nothing
short of an ultimatum to industry to exploit Germany's
natural resources, however poor they might be, and
whatever the cost, so that the Fatherland might become
independent of raw material imports from abroad.
A people, he claimed, tCan exist only on what it can
wrest from nature by its own efforts and on what it is
able to do with what it has thus pried loose. He would
give industry one more chance on its own initiative to
exploit natural resources hitherto considered unremu-
nerative-or else! "The word 'impossible' does not exist
for us," he cried out passionately.
I shall no longer stand for the capitalistic practice of
securing title to unremun4erative deposits of natural re-
sources and then abandoning them without putting them
to use. If necessary I'll have the state seize them in order
to make them available.
181
 TYCOONS AND TYRANT

His whole manner vvas that of an ill-tempered road

gang boss reading the riot act to his workers for not
having performed as he expected them to.
Hitler was preceded by Hermann Goring as head of
the Four Year Plan organization. For two hours the be-
medaled marshal harangued the assembly, exhorting,
cajoling, taunting. He postulated:
Business and industry do not exist for themselves, but
must serve the policies of the state. The aim of National-
Socialist policy is the vvelfare of the entire people. That
means, of course, that the antiquated liberalistic principles
of economic thinking can have no place in Nazi Germany.
He ended by urging; the industrialists to '"stick their
noses into the ground like truffle-hunting swine and sniff
for raw materials."

The date of Hitler's lblunt preachment to the captains

and scientists of indus1try, it should be noted, was De-
cember 17, 1936. It ushered in the period when Hitler
no longer thought it necessary to worry about foreign
opinion.
Earlier in the year he had received ample proof that
the disillusionment .,which was gradually seeping
through all ranks at hoJme was not being shared abroad.
On the contrary, there Hitler's stock was obviously
rising.
Athletic and sports enthusiasts from every section of
the world had hastened to Berlin to take part in the most
successful Olympic Games ever staged. A half-Jew,
Theodor Lewald, form~er undersecretary of the interior,
was permitted to remain at the head of the organizing
committee, thereby conveying the impression that anti-
Semitism wasn't as fierce in Germany as we of the foreign
press represented it to be. For the duration of the games
182

-
 DISILLUSIONMENT AT HOME

the most radical anti-Semites were restrained. The fight

against the churches was temporarily called off. The
Olympic Games of 1936 were hailed as marvels of or-
ganization. The credit went to Hitler-and the foreign
currency, lavishly spent by the visitors, into armaments.
Among the distinguished visitors to the games whom
Hitler entertained personally were Czar Boris III of
Bulgaria, the Crown Princes Gustav Adolf of Sweden,
Umberto of Italy, and Paul of Greece, British Under-
secretary for Foreign Affairs Sir Robert Vansittart, For-
mer British Navy Minister Lord Mansell, newspaper
publishers Viscount Kemsley and Lord Camrose of the
London Daily Telegraph, Polish State's Secretary Count
Szembek, Italian Propaganda Minister Dina Alfieri, and
Mussolini's two older sons. Count de Baillet-Latour,
chairman of the International Olympic Committee, in a
press release praised the ''grandiose framework and at-
mosphere of general sympathy, marred by no political
difficulties," which characterized the 1936 games.
Nor was this all. Late in 1935 and earlier during the
Olympic year the Fuhrer had received Philip Kerr Mar-
quis of Lothian, former secretary to Lloyd George, the
Marquis of Londonderry, former British minister of air,
even Arnold Toynbee, the noted historian, as well as a
delegation of American bankers. Egyptian and Greek
professors had paid him courtesy calls.
Also, Hitler had driven a wedge between Great Britain
and France by signing a naval agreement with England
the year before, and only a few months before the open-
ing of the Games had remilitarized the neutralized left
bank of the Rhine without drawing more than verbal
protest from the partners to the Treaty of Locamo.
Shortly after the completion of the Olympic Games,
Lloyd George's three-hour visit to Hitler at his mountain
home in Berchtesgaden attracted world-wide attention.
183
 TYCOONS AND TYRANT

The aged British statesman was enchanted. He stated

that he considered the Nazi Fuhrer a great man and was
himself ready to say ":Heil Hitler." 6 After his return to
London he expressed his enthusiasm in various press
interviews. To a representative of the Sunday Times he
said that "the German chancellor is a man of great un-
derstanding and of a fascinating gift of conversation,
whose honesty deeply impressed me." To the Daily Ex-
press he commented that Hitler was the George Wash-
ington of Germany, then continued: "One man has
worked this miracle. He is a born leader of men, a mag-
netic, dynamic personality.'' To the correspondent for
the Berlinske Tidende of Copenhagen he emphasized
that "formerly America has been considered the land
of unlimited possibilities-now it is Germany."" 7
Scarcely a year later Winston Churchill wrote in an
open letter addressed to Hitler and published in the
London Times: 8
Should national misfortune comparable to Germany's in
1918 ever befall England, I shall pray to God to send us a
man of your power of '\vill and spirit.
Lloyd George's journey through Germany was soon
followed by the first Italian state visit, that of Mussolini"s
son-in-law, Foreign Minister Count Galeazzo Ciano, and
an official Austrian visit by Foreign Minister Guido
Schmidt. During that autumn, also, a delegation of
French war veterans headed by Henri Pichot were the
guests of the corresponding Nazi organization.
6. Walter A. Gorlitz and Herbert A. Quint, Adolf H itler-eine Bio-
graphie (Stuttgart; Steingriilben Verlag, 1952), p. 462.
7. The quotations from press interviews are a retranslation into
English of the German versions in Das Archiv, N achschlagewerk
fur Politik, Wirtschaft, Kultur, September 1936. Published by Verlags-
anstalt Otto Stollberg, Berlin.
8. Requoted in Sonntagsbote, Cologne/Speyer, February 3, 1952.
184
 DISILLUSIONMENT AT HOME

In the late spring of the following year, 1937, busi-

nessmen from the four corners of the earth congregated
in Berlin to attend the world convention of the Interna-
tional Chamber of Commerce. The most lavish hospi-
tality shown since the days of Kaiser Wilhelm II was
offered the foreign guests by the Nazi regime. A fete
reminiscent of the Arabian Nights was staged by Propa-
ganda Minister Joseph Gobbels on Peacock Island near
Berlin which took the visitors' breath away. 9 Our Amer-
ican Thomas J. Watson, president of this world conven-
tion, and Fenterer Van Vlissingen, his Dutch successor,
received high decorations from Der Fuhrer. (When Hit-
ler declared war on the United States, Watson made
haste to return his. )
Once again the whole world and especially the Ger-
man people took note when it became known that Lord
Halifax, ostensibly coming to Berlin in a purely private
capacity in November 1937 to visit the annual Hunting
Exposition and to be Goring's guest at a hunt, had gone
to Berchtesgaden for a long conference with Hitler held
in the presence of Foreign Minister Konstantin von Neu-
rath, and that he had later visited Hermann Goring and
Joseph Gobbels for extended talks. The British govern-
ment was finally moved to inform the public that the
talks had been "purely exploratory." But it was also
admitted that Prime Minister Chamberlain and Foreign
Minister Anthony Eden had briefed Lord Halifax thor-
oughly before his departure for Germany.
Other men of fame made haste to pay their respects
to Hitler's Third Reich. The Duke and Duchess of Wind-
sor came to Nazi-land as the personal guests of Robert
Ley. Socialist George Bernard Shaw had kind words to
9. Cf. Louis P. Lochner, What about Germany? (New York; Dodd,
Mead & Co., 1942 ) , p. 79.
185
 TYCOONS AND TYRANT

say for the man who put the German socialists out of
business.
That same year, 1938, all the important ambassadors
accredited to Berlin accepted Hitler's invitation to attend
the annual party rally at Niimberg in September-all
except the United States Ambassador, William E. Dodd,
who was represented by a lower embassy official. The
role of British Ambassador Sir Nevile Henderson, who
had been accredited in the spring of 1938, was humili-
ating: day after day he was put off, although he had
urgent orders to confer with Hitler on the Czech crisis,
then reaching its acme. Der Fuhrer, he was told, was
too busy. This happened to the personal representative
of His Britannic Majesty!
It is scarcely possible to overrate the depressing effect
which the sentiment for Hitler of so many official or
otherwise influential persons in foreign countries had on
the scattered but ubiquitous groups of dissident, worried
Germans. These men and women had strong counter-
arguments to answer even without the adulation of for-
eigners: Hitler's persuasive protestation of his love for
peace, his avowed determination to achieve freedom and
greatness for Germany without bloodshed, his successes
in the field of foreign relations. All this seemed again and
again to prove him right. Foreign approval had a para-
lyzing effect upon the morale of Hitler's opponents at
home, and even at times made them doubt the sound-
ness of their judgment. Foreign acclaim seemed to estab-
lish that Hitler was a great leader, perhaps even Europe's
Man of Destiny.
The last hopes for softening and sobering up the Hitler
regime were dashed to the ground when Hitler per-
suaded British Prime Minister Neville Chamberlain,
French Premier Edouard Daladier, and Dictator Benito
Mussolini to agree to the partition of Czechoslovakia on
186
 DISILLUSIONMENT AT HOME

what has come to be known as the Munich Day of Ap-

peasement, September 3:0, 1938. "Peace in our time,"
exclaimed Chamberlain.
In the face of the cheers abroad, the disillusionment
at home gave place to dull resignation to the inevitable.

187
CHAPTER TEN

Did German Industry

Want War?

h e realization that war does not pay was by no means

common before the outbreak of World War I in 1914.
Sir Norman Angell had preached to deaf ears with his
revolutionary work, The Great Illusion, in which he
warned prophetically that the next war would spell ruin
for victor and vanquished alike. He could only comment
with a sigh, when taunted about the failure of his effort,
"We were not successful-we were merely right."
The War of 1914-18, however, proved to every indus-
trialist that peace is infinitely better for a country and
its business than war. It showed that modem warfare
has become costly beyond most pessimistic estimates.
Even for the winner it inevitably means severe taxes and
years of financial instability.
The horrifying pace with which weapons of destruc-
tion have been invented, perfected, and expanded has
led to a general realization that fortifications are no
longer impregnable, that distances are no hindrance to
advance in our motorized age, that the destruction
wrought by modern fire power can annihilate whole
cities.
More than that, during the First World War a new
188
 DID GERMAN INDUSTRY WANT WAR?

and terrible weapon was introduced which, as it devel-

oped in the years that followed, rendered the word
"security" almost meaningless. That terrible weapon was
aviation. Before the air was also harnessed to the pur-
poses of Demon Mars, arms plants located beyond the
reach even of fast-moving armies could continue to pro-
duce uninterrupted. Their workers could come and go
unmolested. Supplies could be brought by rail and water
unhindered. The air forces of belligerent nations have
changed all that.
During World War II and since its conclusion even
more ghastly weapons have been invented and developed
-the atomic and hydrogen bombs. Their mere mention
can send shudders down one's spine.
To assume blandly that German industry wanted w
and therefore supported the regime of Adolf Hitler is
to contend that the German industrialists are incredibl
stupid. If the experience of World War I was not suf-
ficient to open their eyes, then at least their observation
of the Civil War in Spain, in which the Iberian skies
were used by the air forces of half a dozen nations in-
cluding Germany as an experimental area, must have
taught them something about the terrors of aerial war-
fare for soldier and civilian alike.
To understand the position of German industry after
the defeat of 1918 certain basic truths should be re-
called:
I. The huge IG Farben combine of the German chem-
ical industries exported 57% of its products to foreign
countries. The volume of business is indicated by these
typical figures (they happen to be for 1928) : total sales,
RM 1,420,000,000 (about $340,000,000); of these, ex-
ports, RM 810,000,000 (about $193,800,000) .
IG Farben became a large share holder and in anum-
ber of cases the owner of the following undertakings:
189
 TYCOONS AND TYRANT

The Winthrop Chemical Co., Inc., the General Aniline

Works, Inc., and the Agfa-Ansco Co., all of America;
the Norsk Hydro-Elektrisk Kvaelstof Aktieselskab of
Norway; the IG Chemie Basel of Switzerland; and the
American IG Chemical Corporation of New York. It
drew vast revenues from the licenses it granted the
Standard Oil Development Company for the synthetic
production of various chemicals from coal, tar, and oil
according to IG Farben processes. It entered into a car-
tel arrangement with a Swiss and a French group where-
by the sections of the world in which each was to sell
its dyestuffs, unmolested by competition from the other
two, were agreed upon, a cartel which was later ex-
panded to include the Imperial Chemical Industries,
Ltd., of London. Mutually satisfactory contracts were
negotiated with chemical producers in Italy, Poland and
Czechoslovakia.
In short, if any concern in Germany was international
in scope and outlook, it was IG Farben. War could mean
but one immediate thing, namely, the seizure of foreign
holdings in countries at war with Germany, the stoppage
of license fees from and the drastic reduction of exports
to these countries.
2. The German producers of steel were united with
other European steel manufacturers, especially of
France, Great Britain, Austria, Czechoslovakia, Luxem-
bourg, Belgium, and the Saar, in the Continental Steel
Cartel (Internationale Rohstahlgemeinschaft), a com-
bine for fixing the production quotas for the member
groups and for eliminating ruinous competition.
This international cartel maintained friendly relations
with the United States producers of steel. American
observers took part in the European meetings of the later
thirties as welcome and honored guests.
At no time from the founding of this cartel in 1926
190
·-.
 DID GERMAN INDUSTRY WANT WAR?

until its last meeting at Liege, Belgium, in June 1939

did any of the national delegations express the slightest
apprehension lest the German members might be inter-
ested in promoting war. On the contrary, after Chamber-
lain had met Hitler in Bad Godesberg and Daladier had
joined Chamberlain, Hitler and Mussolini at Munich,
telegrams of felicitation were exchanged between the
German, British and French members that war had once
more been averted. Also, a few days later some twelvet
leading German industrialists met at the home of Carl:
Bosch. A feeling of profound relief that the threatening\
war had been forestalled was shared by all present.
3. The leaders of Germany's heavy industries were in
a better position than anyone of their compatriots to
estimate the chances of victory or defeat from the view-
point of production of raw materials available for arms
production. Guided by this knowledge, Ernst Poensgen,
Director-General of the United Steel Works, in January
1940 utilized the first opportunity for the industrialists
to present their point of view to the government in an
address before a group of government experts headed
by State Secretary of Economy Friedrich Walter Land- .
fried. That this opportunity came to Poensgen only five
months after Hitler had started World War II was not
his fault; Hitler ignored industry completely in his plans
for aggression.
Poensgen stated bluntly that in his opinion the United
States would enter the conflict sooner or later. Produc-
tion estimates must therefore take this factor into ac-
count. America's annual output of eighty million tons of
steel, he showed, made Germany's figure of twenty-one
and a half million look puny. He also dwelled on th~ :
scarcity of manganese, wolfram, chromium, and other
metals which Germany needed for producing high-grad
191
 TYCOONS AND TYRANT

steel. His listeners could draw but one conclusion: Ger-

many could not win the war.
His warning was disregarded. Most of Poensgen's in-
dustrial colleagues agreed with him, but on the side of
the government apparently only General Georg Thomas,
chief of the economic staff of the Supreme Command of
the W ehrmacht, took the same stand. 1
4. The leaders of German industry knew better per-
haps than anyone else that the stockpiling of strategic
materials is a prerequisite to waging a successful war.
Hitler, never an economist, did not worry about reserves.
He felt certain that a Blitzkrieg would end in a Blitzsieg.
It stands to reason that, had they been bent u on war
as is so commonly assumed, the German tycoons wou d
have done some stockpiling on their own, have soug t
to persuade Hitler that he must pay more attention to
this phase of preparation for war, and have yielded
readily to the professional proddings of General Thomas
for increasing defense production.
The contrary was the case.
In a lecture delivered October 15, 1937, before
1. General Thomas was the top economic expert of the W ehrmacht.
He was anything but a tool of Hitler's, and reserved his independence
of judgment both vis-a-vis the Teuton dictator and the German
industrialists. He .even went so far as to deliver public addresses and
hold press conferences which left no doubt about his views regarding
Germany's inability to engage in a major war. His opposition to Hit-
ler's aggressive plans resulted in his arrest as a defeatist in October
1944. Condemned to death at Dachau, he escaped execution only
by the arrival of the American troops late in April 1945. Then our
American interrogators took over and Thomas was flown to Naples,
Capri, and Adversa in Italy, thence to Versailles and back to Frank-
fort, Germany, where he was held as a war criminal and rushed off
to Wiesbaden. Because of his failing health he was subsequently taken
to an officers' hospital at Falkenstein in the Taunus Mountains. There
he wrote a fifteen page essay, entitled Gedanken u.nd Ereignisse
(Thoughts and Events), dated Falkenstein, July 20, 1945. He died
in the hospital on December 29, 1946.
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 DID GERMAN INDUSTRY WANT WAR?

the W ehrmachts-Akadernie at Berlin-Kladow, General

Thomas complained to his brother officers that he had
had the greatest difficulity before 1933 to awaken any
interest in defense preparations in German industrial
circles. They knew that defense preparedness rebounds
in heavy taxes.
He then presented a gloomy picture of Germany's 1
defense status. No hoarding of gold and foreign ex- ,
change was taking place, he charged, because Hitler had .:
proclaimed that work alone counts and that money is a ·
fiction. Plans to achieve :independence from foreign na-
tions as regards food-one of Hitler's pet ideas-were
doomed to failure, he said, as Germany never could
become self-supporting. Instead of 760,000 tons of steel
needed by the W ehrmacht annually for its defense
needs, only 300,000 tons were available; but the build-
ing of monumental edifices to glorify the Third Reich
continued unabated. Fr,ee enterprise and freedom of
research were being inteJrfered with, yet both were nec-
essary from a defense viewpoint. No plans whatever had
been made for the deployment of labor power in the
event of a war. In conclusion he pleaded for detailed
study of the economics of potential enemies, and lauded
Great Britain's excellent economic espionage system.
All this did not sound as though German industry were1
stockpiling in anticipation of, much less in the hope for,
a coming warl
From Thomas' statement of 1945 we learn further that
the general took pains during the months following the
Munich Day of Appease:m ent (September 30, 1938) to
establish personal contact with all industrial and busi-
ness leaders of consequence, to satisfy himself that he
was right in his pessimisltic outlook for Germany in the
event of war.
193
 TYCOONS AND TYRANT

"I encountered nothing but complete agreement with

my views in these days,," he wrote. He then continued,
a~~usingly :
Unfortunately I must today assert that, once the sun of
Hitler's grace began to shine on Dr. Todt and Herr Speer,2
a large number of these \\1irtschaftler [men of the economy]
completely reversed their positions, fell under the ban of
these new party big shots:, and enthusiastically agreed with
their war propaganda and psychosis of holding out to the
end. If the German people today rightly demand an ac-
counting of their top soldliers, this applies also to many in-
dustrial leaders who did not have the courage, although
convinced I was right, to jjoin me in stating clearly that they
regarded this war as senseless and as hopeless for Germany.
This is a serious accusation and must be weighed later
when we inquire into German guilt by omission. It
should be noted here, however, that the .intellectual and
moral collapse of these industrialists took place in the
·middle of the war rather than in the early days of ..the
Nazi regime when Hitler had not yet shown his ~.~~~
and when opposition might have been effective. In 1942
and 1943 there was not much else for a businessman or
a workingman to do than to howl with the wolves and
make the best of the circumstances beyond his control.
The question with which we are here concerned is
quite a different one, namely, whether German industry
wanted war and whether it had a hand in starting it.
Thomas absolves it oJf that charge. In another essay,
written July 19, 1946, and entitled, "Concerning the
Question of German Economy's Guilt" ("Um die Schuld-
frage der deutschen W irtschaft''), he wrote :
2. Fritz Todt, Inspector of General Construction, later Minister for
Armaments and Munitions, wats killed in an air accident early in 1942.
He was succeeded by Hitler's favorite architect, Albert Speer, who
was condemned as a war c1iminal at Niimberg and sentenced to
twenty years' imprisonment.
194
 DID GERMAN INDUSTRY WANT WAR?

German industry realized that only a pact with the west~­

and peace with the west could guarantee prosperity. . . .
Nowhere was there any desire for war. . . . Industry had no
expansionist desires . ... It never wanted a conflict ... .
Goring and Hitler were opposed to the big industrialists.
They thought secrets could not be kept by them . . . . But
as they had the basic products and the capital, Hitler
changed his mind. . . .
In 1937 Adolf Hitler insisted German preparations were
for defense only. They [the industrialists] had reason to
believe him. . . .
Germany entered [the war] relatively unarmed and would
have capitulated sooner except for the booty taken.
Telford Taylor indirectly confirms the absence of
stockpiling for preparedness by German industry 1n
these words: s
Amazingly enough, as General Thomas' memoirs reveal,
and as is confirmed by many other sources, the half-way
character of the economic mobilization persisted to a con-
siderable degree for nearly four years, and was not finally
turned to total mobilization until 1943, after the advent of
Albert Speer as Reich Minister for Armaments.
During the summer of 1938, in other words, one year
before Hitler started the Second World War, two hith-
erto unpublished reports were made by the Control Of-
fice for Iron and Steel ( Uberwachungsstelle Eisen und
Stahl) , an institution working secretly for the Reich
Ministry of Economy as an economic Gestapo. The first,
dated July 25, 1938, dealt with the possibilities of pro-
ducing pigiron and raw steel in case ore imports from
other countries should cease; the second, dated August
31, with the mobilization of iron reserves ( Eisenbe-
stiinde) in the event of war ( im A-Fall).
3. Telford Taylor, Sword and Swastika (New York; Simon and
Schuster, 1952), p . 323.
195
 TYCOONS AND TYRANT

These two reports bear evidence to the fact that Ger-

man heavy industry did nothing in the way of stockpiling
in order to be ready in the event of war.
The report of July 25 declared that
In the event of a stoppage of all ores from abroad, the
production of pigiron which at present is being produced
at the average [monthly] rate of 1.5 million tons and of raw
steel which at present is being produced at the average rate
of 1.85 million tons can be continued at the rate of about
300,000 tons less, but only for 3.9 months. . . . After 3.9
months all supplies of ores and slag stored throughout
the German Reich in the various smelting houses would
be exhausted. . . . After the fourth month, therefore, a
production of only 324,000 tons of pigiron could be
counted on. . . . Raw steel production would amount to
only 550-600,000 tons.
The second report, which dealt with the question of
what reserves in the way of native ores could be mobi-
lized in the event that Germany were cut off from for-
eign imports, observed that,
... including all available reserves, the requirement of
1.3 million tons could in the event of war be fulfilled for
6~ months. Upon the expiration of 6~ months only scarcely
one-half of the required 1.3 million tons could be obtained
from German sources.
The report emphasized, however, that even this figure
was optimistic in that it did not take into account the
possibility that enemy action might interfere with the
mining of indigenous ore.
The two secret reports show clearly that Germany was
woefully dependent upon other countries for iron and
steel production. As Jakob W. Reichert, executive direc-
tor of the Wirtschaftsgruppe Eisenschaffende Industrie
expressed it on the witness stand at Niirnberg.
196
 DID GERMAN INDUSTRY WANT WAR?

An industry which was 80% dependent upon foreign coun-

tries for its requirements of iron and manganese ores would \
have pursued a policy of .suicide had it worked to bring
about a war.
5. Hitler himself took pains to keep the industrial
leaders in the dark conce1ming his aggressive plans. His
first intimation that he intended to make war came in a
top-secret meeting on November 15, 1937, the details of
which have become knovvn through the publication of
the Hossbach Protocol. Friedrich Hossbach, then a ma-
jor, was selected to keep the minutes of this conclave
to which Hitler had asked only General von Blomberg
as minister of defense, (;eneral von Fritsch, Admiral
Erich Raeder and General Goring as heads of the army,
navy, and airforce, respecltively, and Baron von Neurath
as foreign minister.
Significantly, nobody representing industry was in-
vited. Only six men besides Hitler, five of them military
people, knew from Hitler's own lips that all of his pro-
testations of peace were l~es.
The following incident illustrates how carefully Hitler
kept his aggressive plans to himself:
Ferdinand Porsche, w·h o constructed the compact
Volkswagen (people's car) for which hundreds of thou-
sands of Germans were saving in a special account, went
to Hitler in October 1937 before building the huge fac-
tory at Wolfsburg near Brunswick ordered by the Nazi
regime. Porsche was aware that German preparedness
was being stepped up.
The question he put to Hitler was, in a nutshell, "Is
there any likelihood that the Volkswagen plant will be
converted into a defense plant?" He then gave his rea-
sons for the question. For one thing, he said, he was
planning to build the testing roads out of wood blocks
197
 TYCOONS AND TYRANT

and not of concrete or asphalt. If the plant was ultimately

to become a defense plant, it would become a coveted
target of enemy airforee, which would obviously dump
incendiary bombs on the wooden runways. If, however,
Hitler assured him that nothing but peace-time low-
priced cars were to be built, and that he foresaw no pos-
sibility of war, he, Pors,che, would proceed with his plans
for wooden testing roads.
Secondly, he said, for a peace-time plant it is proper
to build the windows perpendicularly. In defense plants,
however, the windows must be built at a slant, so that
the observers in enemy planes may not see what sort of
machinery or other equipment is inside a given building.
\ Adolf Hitler assuredl Porsche categorically there was
\ not the slightest danger of any war; he certainly was
\doing nothing in the vvay of planning for war; Porsche
{should carry on with his original plans.
No sooner had war been declared in September 1939,
than Hermann Goring seized the Volkswagen plant on
behalf of the Luftwaffe. The thousands of "little people"'
who had been saving for a Volkswagen never saw their
cars, and their accumtUlated bank credits for the in-
tended purchase were ·COnverted into war loans. Instead
of the Volkswagen, a sort of German equivalent for the
American jeep was designed and constructed.
6. The fact that defense production began to take an
· upward trend after Hitler in 1935 began to rearm was
not regarded by the industrialists as an indication that
Hitler was heading for war; it seemed a natural outcome
of his success at brushing aside the Treaty of Versailles
with impunity and restoring complete German sover-
eignty.
General Thomas contended: •
4. In his essay, Urn die Schuldfrage der deutschen Wirtschaft.
198
 DID GERMAN INDUSTRY WANT WAR?

It would be wrong not to concede to German industry

and its leaders that they had every reason to trust in the
honesty of Hitler's promises, to interpret rearmament as a
measure of defense only, and to regard it as their patriotic
duty to cooperate in this effort.
Ernst Poensgen in a statement written August 24,
1945, explained the attitude of United Steel toward in-
creased defense contracts in these terms:
The United Steel Works were permitted under the terms
of the Treaty of Versailles to manufacture guns at Bochum.
That this production would increase with the enlargement
of the army from 100,000 men to 400,000 seemed but natural.
Following the decision to build the W estwall 5 opposite the
Maginot Line, our Hoerde plant developed the casting of
armor-plate cupolas without nickel, which to everybody's
astonishment proved to be safer under fire than those with
nickel. Next Director-General Walter Borbet received orders
to manufacture guns. Inasmuch as the Bochum grounds and
the installations there were not suited, he bought the Hano-
mag Locomotive Factory at Hanover, which was lying idle
except for a small section used for building automobiles.
As far as I remember the only things manufactured there
until the outbreak of the war were antiaircraft guns and
possibly some few field-guns built according to drawings
from Krupp . . . .
I don't believe that a single bomb was made before the
outbreak of the war. 8 The factory for this purpose at Lan-
gendreer, an unoccupied plant, began operations only dur-
ing the second year of war and made one hundred pound
bombs; the heavier ones were developed even later else-
where. The building of tanks was begun at Hoerde in 1941,
as were also mines in Dusseldorf. All sorts of other things,
such as armor-plate, submarine parts, increased production
5. Known in the United States as the Siegfried Line.
6. Poensgen obviously refers only to plants under his control; some
defense plants, of course, were manufacturing bombs.
199
 TYCOONS AND TYRANT

of shells, etc., were tak,en up only later and the necessary

plants were erected during the war, partly with W ehrmacht
money.
I repeat: until the wa:r the increase in armaments seemed
to me quite plausibly to be intended solely for purposes of
defense. Besides, I be)j[eved Hitler and Ribbentrop were
merely bluffing with this rearmament and were hoping to
achieve political successes without loss of blood-a thing
they actually succeeded in doing at Munich and Codesberg.
7. Four times after the close of World War II, learned
Allied counsel did their level best to prove that leading
German industrialists contributed to the preparing, plan-
ning and waging of aggressive war and had formed a
conspiracy for that purpose.
First came the openilng trial of Goring, Hess, Ribben-
trop, et al., among whom Gustav Krupp von Bohlen was
to have sat as a representative of industry. He was, how-
ever, too ill to attend.
The Flick, IG Farben and Krupp industrial trials fol-
lowed. In all three the indictment included the charge
of conspiracy to bring about war.
The formidable list of prosecutors, research assistants,
and interrogators who :sought to establish the industrial-
ists' lust for war includes such names as U.S. Supreme
Court Justice Robert H:. Jackson, Brigadi~r General Tel-
ford Taylor, Josiah E . Dubois, Joseph Kaufmann, H.
Russel Thayer, Drexel A. Sprecher, Thomas E. Erwin,
and Charles S. Lyons.
In each of these trials the charge of war-mongering
on the part of the industrialists was thrown out as not
proven.

This chapter would be incomplete were I not to dis-

cuss the special role of the Krupp Concern in the period
between the two World Wars.
200
 DID GERMAN INDUSTRY WANT WAR?

Why Krupp? Because the name throughout the world

is synonymous with Cannon King. An explanation for
this epithet may be found in the fact that the Krupp firm
first attracted international attention through its exhi-
bition of huge gun barrels made of single pieces of steel
during the London and Paris World's Fairs of 1851 and
1855, respectively.
"Why is it that the onlly name mentioned when gun
making is discussed is that of Krupp?", a distinguished
British correspondent was asked in my presence by a
veteran member of the fi:rm.
"Quite simple-the word 'Krupp' is so short and so
easy to pronounce/' was the Englishman's reply.
This remark does not tell the whole story. Political
propaganda has succeeded in firmly implanting the idea
in the minds of western peoples that Krupp symbolized
aggressive Prussianism.
The present head of the firm, Alfried Krupp von
Bohlen, has given up trying to eradicate the odium-he
grins and bears it, resignedly.
In an authorized interviiew which he gave Ian Colvin
for publication in the London Sunday Express of March
22, 1953, the following husband-and-wife dialogue is
included:
The vivacious Vera [Mrs. Alfried von Bohlen] breaks in
with a remark: "Can't it be made plain that Krupp did not
only produce guns?"
"No," argues Krupp. "Everybody associates Krupp with
· guns, even the Germans."
Two facts are usually overlooked when the name of
Krupp is mentioned:
1. After the First World War and until Hitler ordered
rearmament, the Krupp ~Concern never devoted more
201
 TYCOONS AND TYRANT

than seven per cent of its output to armaments pro-

duction.
2. Before 1914, while armaments were a big item in
Krupp manufacture, they never became the main enter-
prise. Krupp concentrated chiefly on locomotives, rails,
and other railway equipment.
By the terms of the Treaty of Versailles, Germany
after 1918 was permitted a small army and a limited
number of weapons, which could be manufactured only
in plants designated by the Interallied Control Commis-
sion. At the request of the Social Democratic German
cabinet then in power, the Krupp Concern was author-
ized by the Control Commission to manUtfacture certain
heavy weapons of more than seventeen centimeter cal-
iber. Allied officers were regularly attached to the Krupp
plants to see to it that the stipulations of Versailles were
observed.
The remainder of the huge concern devoted its ener-
gies to the manufacture of peace-time goods, from loco-
motives to false teeth. Also, in the words of Professor
Pounds: 1
The Krupp firm produced high-quality steel and carried
on research in steel and steel structures. Steel of the kind
produced by Krupp 8 was used for many purposes besides
armaments and armor-plate, and metallurgical research
could be of as great a value for the manufa,cture of railway
locomotives as of tanks. It is highly probable that the re-
search developments of the Krupp firm w·ould have con-
tinued whether there was a prospect of Gernnan rearmament
or not.
The change-over from war to peace production in the
early twenties was by no means easy. There were months
7. Norman J. G. Pounds, op . cit., p. 248.
8. Especially Nirosta and Widia.
202

"·
 DID GERMAN INDUSTRY WANT WAR?

when even the Krupp Concern had acute financial

worries.
Oldtimers in the Krupp directorate whose veracity I
have no cause to doubt have assured me, different ones
at different times, that Krupp von Bohlen at the end of
the First World War seriously considered giving up arms
making altogether. Once again, however, hi:s attachment
to the Krupp tradition was stronger. Here were several
thousand skilled workers who knew how to make guns
as perhaps nobody else in Germany did. Was he to throw
them out of their jobs?
He decided to continue to manufactur•e arms on a
greatly reduced scale, but, scrupulous as always, gave
orders that nothing must be done in contravention of the
Treaty of Versailles.
Now, one German cabinet after another held that,
while only certain categories of arms might be manu-
factured, there was nothing in the treaty 1to forbid de-
signing and blueprinting of types which fell under the
Versailles ban. The government therefore commissioned
the Essen firm to make blueprints also for weapons
which presently could not be manufactured, especially
submarines and certain types of guns. Gustav Krupp von
Bohlen, always obedient, and relieved at least partly of
the problem of what to do with so many \vorkers, kept
up ballistic research and blueprinting of advanced types
of weapons, taking comfort in the thought that he was,
after all, merely doing his duty as a patriotic citizen.
Relation with the German Navy became esp•ecially close.
The fact that foreign powers, though knowing of the
government's commission to him, did not protest, seemed
to indicate that the official German interpretation was
correct. Krupp blueprints were actually used for the
construction of Dutch, Spanish, Finnish, and Turkish
submarines in their native shipyards.
203
 TYCOONS AND TYRANT

German legal minds, both in the government and in

industry, further held that there was Jrlothing in the
Treaty of Versailles to forbid preparations against the
time when its provisions might be rescinded. In other
words, the Krupp firm considered itself authorized to
plan for the day when it could again engage in the
armaments business without restrictions. This attitude
explains why Krupp von Bohlen in April1941 wrote in
the house organ of his company:
Everything within me, as with many other Germans,
revolted against the idea that the German people would
remain enslaved forever . . . . I never doubted one day a
change would come. . . . I wanted and had to maintain
Krupp, in spite of all opposition, as an armament plant-
although for the distant future.
In plain language, so long as he refrained from actually
manufacturing forbidden weapons, Krupp von Bohlen
felt justified to maintain his armament potential con-
sisting of a nucleus of skilled employees, and to keep
his armaments plants up-to-date in spite of the tempo-
rary financial losses entailed-all with an eye to the
future.
German legal minds saw a loophole in the Treaty of
Versailles whereby Krupp and other Gernnan firms could
engage in the armaments business outside their native
land without violating the treaty. They discovered there
was nothing to prevent Krupp from linking up with con-
cerns outside Germany, both by acquiring a financial
interest in them and by licensing them to use Krupp
processes and patents. At no time, however, did the for-
eign connections of Krupp supply the G~erman Reichs-
wehr with arms.
Probably the most profitable deal was that with the
Bofors Company, Ltd., of Sweden. The Essen firm in due
204
 DID GERMAN INDUSTRY WANT WAR?

time became its principal shareholder and major licensor.

Krupp could use the Bofors establishments as his ''guinea
pig" for testing new armmnents inventions. Krupp repre-
sentatives had the unlim.ited right to visit the Bofors
arms plants and to elicit any pertinent information.

How serious Krupp was about living up to the letter

of the Treaty of Versailles as interpreted by German
authorities is indicated by two incidents. Arno Griess-
mann, head of the Krupp Gruson Works at Magdeburg,
in 1927 was summoned to Essen to take over the Krupp
war materials division. H[e later described his meeting
with the Cannon King: 9
When I was about to assume my duties, Mr. Krupp von
Bohlen said to me, verbatinn: ''Herr Griessmann, I solemnly
pledge you personally on taking over the war materials di-
vision to see to it that nothing is done in the division which
has now been placed under you that violates the Treaty of
Versailles. Inform yourseH exactly through Herr Baur.n
Georg Carl Friedrich B:aur, a Krupp director who had
represented the firm in China, India, and in Krupp's ship-
building wharves at Kiel, had been assigned the task of
making a precise study of the Treaty of Versailles and
its interpretation as laid down in the German War Im-
plements Law, so that no violation might be committed
in the Krupp plant.
The second incident occurred when Hitler began
German rearmament in 1!935. Again I quote from Arno
Griessmann's memoirs:
When measures for reannament were begun under Hitler,
efforts by the Fuhrer and g:o vemment offices designated by
him soon began to try to persuade the Friedrich Krupp
9. Erinnerungen an He"n G:ustav Krupp v. Bohlen und Halbach,
a private paper.
205
 TYCOONS AND TYRANT

Company to manufacture arms forbidden by the Treaty of

Versailles. I recall frequent and ever more disagreeable ne-
gotiations in Berlin in the course of the years, in which the
demand became even more pressing for F.K. to "comply
with the wish of the Fuhrer.'' Reference ,.vas made again
and again to the fact that other firms were not so "thick-
headed'' and more ready to meet "the wishes of the Father-
land" in these matters. Whether these references were based
on fact I am in no position to judge; at any rate, I reported
them dutifully to Mr. Krupp von Bohlen. lie remained ad-
amant, saying: "What others are doing is: no concern of
mine. We can furnish our employees work and bread even
if we don't manufacture forbidden war imtplements."
The situation worsened until the following occurred:
General [Kurt] Liese, chief of the army ordnance office,
advised me one day that "the patience of the Fuhrer was
exhausted." I would receive an order, he said, to visit Gen-
eral von Blomberg, who would inform me in the name of
the Fiihrer that he was determined to take most extreme
measures in case Herr von Bohlen continued to refuse to
comply with the wishes of the government. That meant for
everybody in the know that he would connpel compliance
with his demand without Krupp von Bohlen.
I hastened to Essen immediately to report to Herr von
Bohlen, who was extraordinarily indignant about such ter-
roristic compulsion. We considered the situation. What was
to be done? If Herr Krupp von Bohlen kept up his resist-
ance in the face of this ultimatum, we had most certainly
to expect, knowing the situation intimately as we did, that
final power of decision at the Friedrich Krupp Company
would pass from Krupp von Bohlen to Hiitler or his ever
willing henchmen. Not only would the demands now under
discussion be fulfilled, but beyond that n•ew plans would
be executed concerning whose incredible extravagance I
was well informed through my negotiations of several years
in Berlin.
If Herr Krupp von Bohlen now yielded, t:he danger of an
occupation of the plant through Hitler or his deputies would
206
 DID GERMAN INDIUSTRY WANT WAR?

be averted. The control would remain with Herr von Bohlen.

Thus at least the possibility existed of acting as a brake on
senseless projects, and demands along those lines could be
held within bearable limits.
I received instructions to inform Herr von Blomberg dur-
ing the scheduled conference that Herr von Bohlen was
ready to give up his resistance to demands by the ordnance
office to this extent: he was willing to manufacture guns
of less than seventeen centimeter caliber within the possi-
bilities for manufacture as tJ'wy existed in his present plants.
[The italics are Griessmannts.]
Herr Krupp von Bohlen clung tenaciously to his deter-
mination to limit this conc4ession of his to the possibilities
afforded by the then existing plants.
One may well wonder .,what would have happened if
Bohlen had resisted the Nazi demand. As in the case of
the Reichsverband der de1Utschen Industrie, having said
''A'' Bohlen had also to say "B." It was not long before
the peremptory demand came to expand the Krupp
plants far beyond their rentability.
"Unfortunately the te:rroristic compulsion became
even stronger," Griessmann concludes, "and Herr von
Bohlen, yielding to this iterror, had to agree to these
plant expansions which he justly considered to be a mis-
take."
Hermann Goring testified in Niirnberg on August
22, 1946, that for Krupp to have refused to obey Hitler's
demands on his plant would have rendered him subject
to punishment for sabotage. "Nobody could refuse," he
held. Herr von Bohlen, he testified, had been exceed-
. ingly unwilling to accept war orders and had yielded
only for patriotic reasons. He added that after the First
World War Krupp had experienced great difficulties
converting from war production to peace-time, and did
not want to face a similar experience again.
207
 TYCOONS AND TYRANT

Goring can hardly be catalogued as a friend of

Bohlen's. Exasperated over the Essen entrepreneur's
lack of enthusiasm for defense orders he said to a Krupp
director derisively and in that uncouth gangster's lan-
guage of which he was fond, ccEuer oller Geheimrat
wilrde lie her Nachtpotte statt Kanonen 11Ulchen" ("Your
silly old Geheimrat would rather make chamber-pots
than guns") .
The Krupp directors in 1938 openly defied the Nazi
government when it demanded that the Germaniawedt,
Krupp's shipyard at Kiel, and the Krupp motor truck
factory ( Krawa) at Essen be put to work exclusively
for armament purposes. The shipyards had, in fact, al-
ready been taken over by the Navy and the motor truck
plant forbidden to continue peace-time production. In
this case both orders were rescinded.
But this was an isolated success. The pressures in-
creased and, as we have learned from Arno Griessmann,
Gustav Krupp von Bohlen felt he must comply.
However we rnay look upon Bohlen's ·yielding,
whether as an unheroic compliance or an inevitable con-
sequence of conditions then existing, there is no doubt
but that the head of the Krupp Concern was loath to
break an international treaty. This is corroborated by
General Thomas, who wrote concerning the attitude of
German industry towards Versailles: 10
It was especially big business, which these days is being
accused of helping along with preparations for war, which
had always emphasized the necessity of living up to the
military and political provisions of the Treaty of Versailles.
I myself, on orders of what then was the Reich War Min-
istry, twice visited Geheimrat Duisberg, the top man in
IG Farben, to interest the IG in developing military pro-
10. Um die Schuldfrage der deutschen Wirlschaft, p. 2.
208
 DID GERMAN INDUSTRY WANT WAR?

pulsive gases and explosives. Both times Geheimrat Duis-

berg declined on the grounds that the big concerns with
their international connections just could not open them-
selves to the charge of treaty breaking. The same view
prevailed in the great electric concerns.
Bohlen's personal view· on armaments was clearly
stated in an address delivered in November 1933 when
he had already become the Hitler-appointed Fuhrer of
German industry. In it he said:
German industry is convinced that peace, truly secured
by co-equal and simultaneous disarmament on the part of
all states, would give an impulse to the economic life of all
peoples such as can never be attained even approximately
by any orders whatsoever for armaments. 11
This utterance will imrnediately be challenged, I am
aware, by anyone who £allowed the Niimberg trials
closely. There a lecture ascribed to Gustav Krupp von
Bohlen was introduced as documentary evidence, in
which war, militarism, and the production of arms were
glorified. It also contained a tribute to Adolf Hitler
couched in superlatives w1hich make one wonder how a
man who was otherwise so sparing in his words could
ever have thought them up.
The lecture was to have been delivered at the Univer-
sity of Berlin, sometime late in 1943. It never was de-
livered. Why? Because, beginning in 1938, Bohlen's
hearing and sight and later his mind began to fail. A
condition developed which made the International Mili-
tary Tribunal in Ni.irnberg desist from producing him
in court. By that time he v;as mentally irresponsible.
His failing health was known to but few people. One
11. Otto Lehmann-Russbiildt, Deutsche General-Feldmarschiille
und ihr General-Geldmarschall ( Berlin-Grunewald; Schriftenreihe der
deutschen Liga fi.ir Menschenrechte, 1953), p. 16.
:209
 TYCOONS AND TYRANT

caller, now a high functionary in the Bonn government,

told me how he visited him at Bad Gast~ein in 1941 and
already then had the impression that the man was col-
lapsing mentally, and how this impression became a
certainty when early in 1944 he saw Bohlen on his Villa
Hugel estate near Essen. The mighty lord of the Krupp
empire was a pathetic sight: he was vvalking up and
down the grounds picking up pieces of enemy shrapnel
and carefully placing the iron splinters in a basket-to
help along the old metals collection of the government.
When the request came for Krupp to speak before the
students of Berlin University, it was thought possible that
he might be able to read a lecture prepared by a mem-
ber of his staff. By that time Nazi control of German
word and thought was already so complete that noun-
derling would have dared to write otherwise than in
terms of the usual cliches about the virtues of militarism
and the wonders wrought by Adolf Hitler. The lecture
written by the Krupp underling ran true to the pre-
scribed form. But: it was never delivered.

A paragraph from the findings of G~eneral Thomas

provides a fitting close to this chapter:
It must be made a matter of public reco1rd that Germany
entered upon the war quite insufficiently prepared from an
economic viewpoint, and that her economic collapse would
have occurred much earlier except for the fact that Hitler's
campaigns of conquest yielded the Wehnnacht tremendous
booty in the way of raw materials and fuels. The extensive
economic preparations for war which a new world conflict
demanded, such as hoarding synthetic fuels and rubber,
exploiting native metals, increasing potass:ium nitrate and
sulphuric acid production, securing an alurrlinum basis, aug-
menting crankshaft and ball-bearing manUtfacture, expand-
ing of high"grade steel super-plants, and s:imilar prepared-
210
 DID GERMAN INDUSTRY WANT WAR?

ness measures were virtually non-existent, but were for the

most part improvised only in the course of the war. This
fact of a lacking, broadly-conceived preparedness is in my
opinion proof positive that, generally speaking, German in-
dustry and its responsible leaders certainly did not foresee,
much less intend to bring about, a new world war.

2~11
CHAPTER ELEVEN

Compliance and Resistance

German tycoons, as we have seen, at first considered

Hitler~s rise to power as merely another in the many
changes of government in the turbulent thirties, except
that it took place more dramatically. They were given
no time to ponder over the full implications of Nazism.
A continuous rush of new ideas and conceptions set in,
which found expression in ever new orders, decrees and
laws with which the bewildered businessman had to
acquaint himself even as he was still trying to interpret
the meaning of the previous one. This was premeditated
by the Nazi usurpers and accounts in part for a confusion
which often led to co1mpliance.
Preoccupation with their own affairs in relation to the
New Order was paralleled by their habitual political in-
difference. They knew· in a general way that there were
concentration camps. These camps evidently were not
pleasure resorts-that much, too, they understood. But
as to just what was going on at Dachau, Oranienburg,
Buchenwald, and other places of degradation and terror
was no personal conce1m of theirs. Most of them believed
only Dachau and Oranienburg existed as concentration
camps. Arrests of leaders in business and industry, ex-
cept toward the end of the regime, were relatively few,
because Hitler was srnart enough to know that produc-
212
 COMPLIANCE AND RESISTANCE

tion had to continue if his dreams were to lbe realized.

It was quite possible for large concerns to persuade the
Gestapo to release a key employee or a ~rorker with
special skills by reason of his indispensability.
The big men of business and industry were caught off
balance by Hitler's quick moves to entrench himself and
his followers in power just as were Germans in other
walks of life. They did not even evince an esp,rit de corps
with their own kind. I have already referred to the sud-
den, brusque dismissal of Geheimrat Ludw·ig Kastl as
executive director of the Reichsverband de1· deutschen
Industrie. 1 It provoked no concrete action o:f protest; it
was merely regretted.
I have also referred to the dismissal of ~vlax Martin
Schlenker, "because he was unbearable for the Party,''
from his job as executive director of the Northwest
Group of German Iron and Steel Industrialists.2 Schlen-
ker happened in addition to be executive director of the
Langnamverein (Long N arne Society) .
When a snooping commission headed by Hans Gob-
bels, brother of the Nazi propaganda minister, could find
nothing incriminating against him other than that he
was not a National Socialist, Schlenker decided to fight
for his position. He received no support from 1the tycoons.
In a sworn affidavit he explained to the French Military
Government Court at Rastatt in February 1948: <Cin a
confidential meeting it developed, however, that the
leading industrial personalities did not have the courage
-or did not deem it opportune-to proceed contrary to
the wishes of the Party."
Paul Reusch, honorary president of the Langnam-
verein, it is true, took Schlenker to his estate near Stutt-
gart to ''celebrate" the ouster, but this was a personal
1. Cf. Chapter Eight, p. 159.
2. Cf. Chapter Five, p. 105.
213
 TYCOONS AND TYRANT

action of friendship by one member of a large board

of directors; Schlenker's dismissal evoked no official
protest.
Nor was the ejection of Paul Silverberg;, lord of lignite,
as president of the Cologne Chamber of Commerce and
as member of the board of the Reichsverband protested.
When one remembers what a multitude of political
parties Germany had before the advent: of Hitler, and
realizes that this was but a manifestation of a rather
common German Hang zur Eigenbrotelei (penchant for
going one's own separate way), the lack of solidarity
among the industrialists is not particullarly surprising.
They were as divided as the population that made up
the German Reich.
Some tycoons, like August Rosterg of the Potash
Syndicate, Otto Wolff of Cologne, or Ernst Tengelmann,
coal baron of Essen, appear to have come into the Hitler
camp with colors Hying as soon as his success seemed
assured. Others, like Albert Vogler of u·nited Steel and
Friedrich Springorum of the Roesch Concern, seem to
have trimmed their sails, albeit grudgingly, to the pre-
vailing political winds in order to save their business.
Some big concerns, like IG Farben, presented a be-
wilderingly mixed picture. On the one hand, the guiding
head, Carl Bosch, was most outspokenly anti-Hitler; on
the other, Director Heinrich Biitefisch, Heinrich Gatti-
neau, and Georg von Schnitzler held honorary ranks in
various Nazi formations. Their explanation is that any
IG Farben top official who had to deal "'ith the German
Labor Front had no choice except to join the Party or
resign.
The automotive industry, generally speaking, wel-
comed the Nazi regime. Hitler was determined to make
Germany automobile-minded and gave every possible
214
 COMPLIANCE AND RESISTANCE

encouragement to this industry, with the result that the

motor car business flourished as never before.
Theodor Heuss, now president of the Federal Repub-
lic of Western Germany, reported that by April 1933
Daimler-Benz (manufacturers of the Mercedes car),
Auto-Union, Opel and Bosch could report full employ-
ment. 8 At the Bosch Concern, the number of employees
and laborers rose within a year from 8,332 to 13,000.
Even foreign motor car •concerns like Ford or General
Motors thought it the part of wisdom to permit their
German subsidiaries to go down the ever narrowing,
autonomy-killing path of regimentation. Nor were they
the only non-German concerns which urged compliance
with Nazi orders upon their representatives in the Reich.
To cite a personal experience: our Associated Press setup
in Germany included a German limited company for the
sale of AP Photos. Technically, I was the manager of
this company, although it was understood between our
head office in New York and myself that I was to be its
top executive in name only, my duties as news corre-
spondent being far more ilmportant both to the AP and
me.
It was not long before the Propaganda Ministry re-
quested me to fill out a questionnaire to prove that I
was not Jewish. Infuriated at this manifestation of racial
discrimination, I asked my superiors what to do. They
replied that, so long as the anti-Semitic decrees of the
present German government were the law of the land,
and since our picture section was a German company,
I must comply.
It so chanced that our actual manager, our ace pho-
tographer, and our efficient sales lady who knew her way
about in every editorial office, were all three Jewish.
3. Theodor Reuss, Robert Bosch-Leben und Leistung (Stuttgart
und Ttibingen; Rainer Wunderlich Verlag, 1946) , p. 369.
!~15
 TYCOONS AND TYRANT

There was nothing I could do about it but dismiss these

three able, faithful employees; and our head office was
not ready to renounce its operations in (;ermany in pro-
test. The only thing I could do for thcem was to help
arrange for their emigration to the United States, where
they have fortunately established themselves well and
with our friendship unmarred.
Some bankers-if one considers them part of the in-
dustrial setup-like Hjalmar Schacht, Heinrich von Stein,
Kurt von Schroder, Emil Georg von Stauss, Otto Chris-
tian Fischer, and Friedrich Reinhardt supported Hitler
actively. They were, however, a minority. German
bankers, on the whole, viewed Hitler's economic course
with dismay, but considered themselves unable to op-
pose actively beyond warning earnestly against many
fiscal measures contemplated by the regime. The ranks
of anti-Nazis were rapidly thinned by the elimination of
all Jews from the banking business.
Many technicians, as already indicat~ed, were happy
over a regime that did not count the costs when it de-
sired technical achievement.'
A good example of the technician who could pursue
his professional hobbies to his heart's content was Walter
Rohland, known in industrial circles as "Panzer-Roh-
land" because of his special interest in tanks and ar-
mor plate. Rohland was the technical director of the
Deutsche Edelstahlwerke. (German High-Grade Steel
Works) at Krefeld when Hitler came into power. The
Fuhrer's decision to set aside the Treaty of Versailles
unilaterally in 1935 and to begin rearmament offered
Rohland his great opportunity to demonstrate his skill.
His relations with the Nazi Party were excellent. Even
Hitler summoned him occasionally for consultation. In
1942 Albert Speer, Minister for Armamtents and Muni-
4. Cf. Chapter Nine, p. 172.
216
 COMPLIANCE .AND RESISTANCE

tions, another technician attracted by Hitler's readiness

to give his ilk every encouragement, appointed Rohland
Deputy Fuhrer of the Iron Industry Group, one of the
new industrial compulsory organizations which had
meanwhile been formed by the Nazis.
Rohland explained his acceptance of this responsible
Nazi post to me in these words:
Speer demanded that I take it and said that if I failed
to do so, I would also lose n1y jobs in industry. Under these
circumstances there was no recourse except to make the best
of the situation. Hermann Roehling, who was appointed
Fuhrer of the Group, and I were certain that if we did not
accept the proffered posts, tnost certainly politicians would
be installed as leaders of our organization. That would have
increased the difficulties of industry considerably.
Rohland stated that technical men could express their
opinions to Hitler freely and that he would listen to
them, whereas politicians, officials, diplomats, and busi-
nessmen could not. At the same time he admitted that
technicians, like everybod)r else, had to carry out orders
of the various ministries, vvhether they considered them
practical or not.
It is a matter of record that Rohland wrote a vigorous
statement opposing the e1mployment of foreign forced
labor in Germany during the war. This statement will
be considered later. 5
The reason which the tank expert gave me for joining
the Nazi Party in 1933 is interesting:
In March of that year Gregor Strasser appealed to me,
saying: "This is the beginnJtng of the end. Criminals have
gained control of the Party. You and people like you will
be responsible for the inevitable debacle if you don't now
join up and help remove the praetorians. Are we to stand
5. Cf. Chapter Twelve, p. 24!2 .
.217
 TYCOONS AND TYRANT

idly by and let ourselves be overrun? It is your duty to join."

So I joined.
By "praetorians'' he seems to have m.e ant the armed
formations of the movement, especially Rohm's Storm
Troops.
Another example of the technician ready to serve the
regime was Ferdinand Porsche, of whom more anon.
Rohland and Porsche apparently belonged to the group
of technicians who acted in good faith.
A more dangerous but small group was that described
by General Thomas in these words :
There was also a small circle of men who, either because
of technical enthusiasm or for egotistical reasons enthusi-
astically offered their services to Gorints plans for preparing
for war 6 and consciously supported his megalomaniacal
schemes. These men have incurred a grave co-responsibility.
Rather than warn Hitler and Goring against another con-
Hict with the far superior English-American economic po-
tential, they supported their infeasible plans and again and
again encouraged these two warmongers t:o hatch out new
[military-technical] projects aimed at goals which very soon
proved to be located in the states that were to be conquered.
These men, who in part belonged to big industry and com-
bined activity within the Four-Year Plan \Vith the manage-
ment of or the exertion of influence upon their concerns,
have weighed down these concerns with a guilt that was
probably not intended. 7
Thomas did not identify these men by name. After all,
they were only "a small circle."
6. Thomas may be referring to an address deUivered by Coring at
Stuttgart in August 1937 before the chiefs of German aircraft-pro-
ducing firms, in which he hinted broadly that their machines might
have to play an important role in a future war for which they had
to prepare. He did not go beyond a hint, however.
7. Um die Schuldfrage der deutschen Wi1-tschaft, by Georg
Thomas.
218
 COMPLIANCE AND RESISTANCE

What, then, were the possibilities for resistance and

wherein could it consist practically? The range of pun-
ishable offenses was wide, and extended from mere
criticism and failure to comply with orders all the way
to conspiracy for the overthrow of the regime by vio-
lence. Given the methods of a modem totalitarian state,
any manifestation within this range was bound to be
suppressed "brutallyn-the Nazis' favorite vvord-at the
slightest indication. To add to the difficulties of resist-
ance, Germany fell prey to the peculiar phenomenon
common to dictatorships which has been described as
atomization. By this is meant the isolation of individuals
from each other because of the omnipresence, real or
assumed, of a watchful and suspicious state police.
A recapitulation of the laws affecting industry which
were passed between 1933 and 1938 will show how
drastically the possibilities for resistance w~ere curbed:
The Reichstag's Enabling Act of March 24, 1933, made it
possible for Hitler to set aside the constitution: Nazi Gleich-
schaltung ended liberalism in industry.
The Economic Ministry's decree of February 27, 1934,
dissolving existing economic bodies spelled the doom of in-
dus trial self-government.
The Law for the Defense of the Realm of :M[ay 21, 1935,
plus a secret decree, herded industry into defense work
under terms which rendered failure to perform virtually
synonymous with traitorous sabotage.
The Four Year Plan decreed on October 13, 1936, estab-
lished the ascendancy of Goring over Schacht in the eco-
nomic realm and rendered innocuous this last b:rake on Nazi
economic tyranny. 8
8. The legalization of Goring's Four Year Plan marked the end of
a bitter fight which Schacht waged to avert the worst: consequences
of Nazi economic ineptitude. Goring had pretended to be on Schacht's
side, although under pressure from his party he discussed economic
affairs in more radical terms. In 1937 Schacht was ahle to report to
219
 TYCOONS AND TYRANT

The law of June 26, 1938, authorizing the Government

to dispose of labor power as it saw fit, opened the doors
for the inhumanities of slave labor exploitation for which a
number of leading industrialists were later punished by the
victorious allies.
Nevertheless, antidotes were developed to Nazi total-
itarianism.
One ruse used time and again was that of declining to
go into a Nazi-proposed project or to manufacture a
given article on the grounds either that the proper equip-
ment was wanting, or that the necessary labor power
was lacking, or that there was a dearth of money where-
with to finance the project, or that the plant was not
adapted to the sort of production desired.
But, as Clemens Lannmers testified in the IG Farben
trial on January 20, 1948:
The Nazi [control] staffs followed through consistently
on all these objections and removed them by state inter-
ference, for instance, in. that they ordered the necessary
finances to be made available, or the materials to be sup-
plied, or technical aid and the like to be furnished. . . .
I was in a position to observe this fight.
The ship-owners of :Hamburg, alerted by what hap-
pened to the Reichsverband and to a number of indus-
Hitler that he had secured the necessary foreign credits for German
rearmament. He now pressed for sane financing. Hitler did nothing
to support Schacht. Goring, who six months previously had been
appointed head of the Four Year Plan for Economic Self-Sufficiency,
told Schacht he needed certain powers now held by Schacht. He
pictured what he intended to do with these powers so artfully that
Schacht not only assented readily but left Berlin for Baden-Baden
in a happy mood, thinking he would be the real manipulator of the
Four Year Plan.
The next morning, he read in the newspapers that Goring was now
Germany's economic boss. Schacht's success with foreign credits, in-
cidentally, did much to confound those in the Ruhr region who still
were not reconciled to the Nazi regime.
220
 COMPLIANCE AND RESISTANCE

trial concerns, decided to :join the Nazi Party as a group.

In that way the usual excuse for imposing a commissar
lost its merit, namely, that non-Nazi undertakings
needed commissars to guide them onto the path of Nazi
righteousness.
"We were never bothered," the head of the oldest
shipping concern in Hamtburg told me. He continued:
We were left to ourselves-we were all regular members,
don't you knowl-and could give expression to our opinions
without fear of being denounced by a stool pigeon.
We were wonderfully supported by our ship captains who
were infuriated that Nazi commissars were placed on our
vessels to watch them. Captains are not the kind that get
scared. They kept the Nazi snoopers at bay and reported
to us on their moves.
In various Berlin industrial plants the managers would
from time to time go before their workers-under orders,
of course-to give them :a patriotic "pep talk'' and to
encourage them to work even harder for the war effort.
These men soon perfected a technique of mixing patri-
otic phrases with references to Hitler in such a way that
the listeners were led to believe Hitler could work
miracles.
They would say in effect:
There are those in our cornmunity who are growing weary
of the war and who are beginning to falter. Don't they re-
member that our Fuhrer has promised us the war will end
in a few months? Don't they realize that he is working
at a miracle weapon which will strike such terror into the
hearts of our enemies that they will capitulate? Just leave
everything to our Fuhrer; he knows all the answers.
No Party spy listening to such a performance could
object. Yet the effect of 1repeating these mouthings on
221
 TYCOONS AND TYRANT

every occasion was to make the listeners sick and tired

of promises that were not kept. Nobody in the Party hier-
archy, however, dared criticize this crafty approach by
the plant manager, for it would have been suicidal to
suggest that the Fuhrer was not the superman he was
represented to be.

A fine example of effective resistance was furnished

by the directors of Cute Hofinungshiitte, powerful Ober-
hausen steel concern, even after their nonconformist
chief, Paul Reusch, and his son Hermann had been re-
moved by the Nazis. A.t a time when many other under-
takings bowed to orders from above to acquire part or
total ownership of plants in occupied areas, or to help
themselves to enemy n1achinery as Ersatz for equipment
destroyed or incapacitated by air action, Cute Hofinungs-
hiitte sternly declined to acquire as much as a tool from
defeated enemy shops. Also, the director of Cute Hofi-
nungshiitte consistently refused to join the Nazi Party,
even after the dismissal of the Reusches.

In 1943, Albert Speer's Armaments and Munitions

Ministry demanded of the Krupp Concern that one of its
plants be transferred to Auschwitz, partly because in-
creasing air raids on western Germany made it desirable
for all important factories to move farther inland, partly
also because the unfortunate inmates of the notorious
Auschwitz concentraHon camp were considered good
reservoirs for inexpensive manpower. Krupp kept delay-
ing this assignment. 1rhe ministry came four times to
offer a concrete suggestion concerning the plant to be
transferred. Finally a peremptory order to move was
issued, which the Krupp Concern felt constrained to
obey.

222
 COMPLIANCE AND RESISTANCE

One man who stands out vividly in my memory of

those days is the foreign minister of Austria and later
ambassador to the United States, Karl Gruber, who dur-
ing World War II was an electrical engineer with the
AEG in Berlin. Gruber Inanaged slowly, patiently and
cautiously to "acquire" part after part from AEG supply
stocks for the construction of a private wireless station
with which he kept in contact with the Austrian resist-
ance movement. Had he been caught, he would have
ended on the gallows.
As in all totalitarian regimes, informing had become
rampant, often for reasons of revenge, often to secure
personal advantage. In industry, many frustrated career-
ists became ardent Nazis. It is, therefore, fair to regard
as a form of resistance the solidarity of members of
boards of directors and the loyalty of servants, anyone
of whom might have turned out to be a Nazi stool pigeon,
shown by their not reporting to the regime critical re-
marks made during board sessions.
Carl Bosch was particularly vehement in denouncing
Hitler whom he called a fool and other names. Although
most of his board members were technically Party mem-
bers (he himself never joined), and hence under obliga-
tion to report all subversive utterances, no one had the
meanness to denounce hi1m.
It may be noted in passing that IG Farben as late as
1936, when difficulties arose for the non-Nazi press,
spent sums totaling several hundred thousand Reichs-
mark to support the Frankfurter Nachrichten, which in
pre-Hitler days had been closely associated with the
German People's Party. Such support amounted to open
defiance of the Nazi regilme.
Hermann Bucher on mtore than one occasion had to
be warned by his fellow board members not to speak
so loud, lest someone outside the conference room de-
223
 TYCOONS AND TYRANT

nounce him. On one occasion, when one member of the

board referred to Hitler in glowing tenns, he bellowed,
"Stop talking about that criminal." Nobody reported
him.
Other industrial leaders also expressed their anti-Nazi
views freely in board meetings, but thes~e examples suf-
fice to demonstrate that beneath the bleaLk surface there
were many more businessmen in sympathy with the op-
ponents of Nazism than has commonly been supposed.
That there were no Judases on the boards of directors
of big concerns must be entered on the positive side of
German industry's ledger.
In the Judgment in the IG Farben trial the defendants
and their firm were given credit for resisltance to certain
Nazi demands in the following words:
The evidence shows clearly that Farben was constantly
under pressure to gather and furnish to the Reich informa-
tion concerning industrial developments and production in
foreign countries. Farben's reluctance to ccomply, even to
the full extent of information actually received, indicates a
lack of cooperation which negatives participation in a con-
spiracy or knowledge of plans on the part of Hitler to wage
aggressive war.
I shall now relate an alleged occurrence for which I
cannot furnish the proof because the document in ques-
tion was nowhere to be found despite voluminous cor-
respondence with persons considered li1kely to be able
to furnish a possible clue. My principal source, however,
is so certain of his facts that I feel safe in including the
happening as a likely fact in this survey . That source is
Richard Merton, head of the Metallgesellschaft of
Frankfurt-am-Main, who with his friend and associate
Alfred Petersen had to leave Germany for racial reasons
(he can thus hardly be accused of pro-Nazi proclivities).
In England he wrote an eight-page account of German
224

- -- - - - - - - -- -
 COMPLIANCE AND RESISTANCE

industry at the request of the British Government, in

which the following passage occurs:
I myself read (I believe it was in 1935) a confidential,
very clear and strongly critical, typewritten memorandum
of many pages, signed on behalf of the leading industrial
groups by Krupp, Bosch ( IG Farben), Siemens and others,
which they presented to Hitler and in it, as far as I remem-
ber, nothing was omitted that deserved criticism.
Dr. Merton has returned to Germany meanwhile and
resumed his place in the Metallgesellschaft. In view of
the importance of the memorandum, of which I had read
or heard nothing in all my researches and interrogations,
I visited the Frankfort industrialist and afterwards cor-
responded with him for months. Both he and I tried to
find someone who possessed a copy of the document.
One of the persons appealed to was AHried Krupp von
Bohlen. He knew nothing about the memorandum. I so
reported to Dr. Merton who pointed out that the docu-
ment was top secret, wherefore it was natural for a cau-
tious man like Gustav, the father, not to say anything
about it to Alfried, the son.
Then, one day, I received a letter from Frankfort, in
which Herr Merton stated in part:
I have written to one of the co-owners of the banking
house of X-, in whose office I had read the memorandum,
and asked him whether he remembered that expose. He re-
plied that he did and that it was quite possible that he him-
self had shown it to me. He supposed that his copy of the
memorandum had been given to a partner of his, now de-
ceased, by the late deputy chairman of the board of Siemens
& Halske, Friedrich Siemens.

This banker joined in the search for a copy of the

document which he remembered seeing, but he, too, was
unable to find one.
225
 TYCOONS AND TYRANT

Possibly it will turn up some day in the Pentagon at

Washington among the tons of documents captured by
the American forces. I can do no more than to state the
facts as I learned them. If indeed the meJmorandum was
written and presented-and I have no reason to doubt
Dr. Merton's word-it was a courageous piece of work.

In Southern Germany I found considerable evidence

pointing to active resistance to Nazism.
An interesting case history is that of the Maschinen-
fabrik Augsburg-Niirnberg, known as the M.A.N. If it
succeeded where most other concerns failed, this must
in part be ascribed to the fact that the German Navy
considered its construction of marine mtachinery as of
vital importance and therefore supported the manage-
ment in its efforts to keep Nazi influences out. But in
part the result achieved is due to the personal courage
of the parties concerned, beginning with the general
manager, Dr. Otto Meyer, who had a Jewish wife.
The Nazis requested he get a divorce. Meyer laughed
at them. They demanded that he remove the Jewish con-
fidential secretary of the concern. He bluntly refused.
The gray-haired secretary, as previously indicated, was
still at her job when I visited the plant in November
1952. Many other concerns, even those whose heads
were against the regime, sought to qualify as a Muster-
betrieb (model enterprise). M.A.N. made no such effort.
That was because the workers, no less than the manage-
ment, looked with scorn upon Ley's ~German Labor
Front.
It sounds hardly credible, but the fact remains that
only 4 per cent of the 12,000 workers at M.A.N. joined
the Nazi Party. The Works Council was as adamant in
insisting upon the retention of the Jewish secretary as
was the management. When Ley came to sell them the
226

~- ..
 COMPLIANCE AND RESISTANCE

idea of the German Labor Front, the comment among

the workers was, "What nerve to peddle such nonsense!"
Whenever any worker was arrested by the Gestapo
because of some unfortunate or thoughtless remark, the
management would intercede immediately and declare
he was indispensable because kriegswichtig (important
for the war effort). He was usually released. The man-
agement also did not hesitate to hire men who had been
dismissed from the Federal Labor Administration be-
cause they were regarded as politically untrustworthy.
When foreign forced labor was sent by the Government,
M.A.N. paid these workers the same wages as it did its
German employees. But the management refused to
accept concentration camp inmates as slave labor.
M.A.N. had good support from the Bavarian Em-
ployers' Federation at Munich, capital of the Nazi move-
ment. Geheimrat Eugen Bohringer, the president, was
an outspoken anti-Nazi. Eugen Bunzl, the executive di-
rector, was on the <<not wanted" list of the Nazis for
racial reasons. Bohringer resisted Bunzl"s removal. In
this he was supported, strangely enough, by one of the
oldest Nazis in industry, Albert Pietsch,9 as Bunzl him-
self told me. Later, when all employers' organizations
were dissolved, Pietsch saw to it that Bunzl was given
decent severance pay.
At the Porsche automobile plant in Stuttgart I ran into
an amusing episode indicating how Prof. Ferdinand
Porsche, designer of the Volkswagen, 10 practiced passive
resistance against Rimmler's SS.
Porsche, as happened not infrequently when the Nazi
regime wooed an industrial magnate whom it needed,
was given an honorary rank of Oberfiihrer in the SS on
the occasion of his sixty-fifth birthday in 1943. The in-
9. Cf. Chapter Five, p. 97.
10. Cf. Chapter Ten, p. 197.
227
 TYCOONS AND TYRANT

ventor-manufacturer did not even bother to acknowl-

edge the receipt of the appointment. C:onsidering the
times in which he lived, this in itself was an act of
courage.
With the appointment there was to go a personal pres-
ent from Heinrich Rimmler in the form o:f the SS Toten-
kopfring ( SS ring with a death's head) , into which a
personal dedication by Rimmler was to be engraved.
But before sending the ring, the jeweler had to have the
measurement of Porsche's finger. Porsche ignored re-
quest after request for information on this point. Four
letters written by SS officials in 1943 r4emained unan-
swered. A fifth one, early in February 1944, was a com-
bination of threat and of pleading that, despite his pre-
occupation with his work, which was fully understood
and appreciated, Porsche should please take care of
this detail. Yielding to the threat, Herr Porsche finally
supplied the information.
The next question which arose was thalt of an SS uni-
form. Porsche did not care to be idenUfied with the
Rimmler organization. He always found some excuse for
not seeing a tailor. The local SS leader, under pressure
from headquarters in Berlin, finally comrnissioned a gar-
ment maker named Watzli who had done work for
Porsche before, secretly to make an SS overcoat which
the professor might wear over his civilian suit. ~'Don't
mind the costs; do your best,n Watzli was admonished.
On the basis of earlier measurements the tailor then con-
structed the garment and delivered it to Porsche.
A few weeks later Gobbels called upon the whole na-
tion to part with such woolen garments as were not
absolutely needed and donate them to the war effort.
Porsche's contribution consisted-of the brand-new SS
overcoat!
228
 COMPLIANCE AND RESISTANCE

I have seen all the pertinent documents in this case.

In the early period of the Nazi regime, it appears,
Porsche had the ear of Hitler and could criticize freely
what some of the Party bosses were doing. As time went
on, however, Der Fuhrer isolated himself more and
more, and his evil shadow, Martin Bormann, saw to it
that, as far as possible, nobody known to have a critical
attitude could reach The Presence.
When foreign forced labor was foisted upon the
Porsche plant, as it was generally upon German factories
during the war, the professor insisted upon humane treat-
ment of these workers. His attitude toward Russian pris-
oners of war will be discussed in the ensuing chapter.11

In protest to the laws discriminating against the Jews,

by which even young Hebrews were ejected from their
schools, Robert Bosch at Stuttgart opened a number of
apprentice positions for them in his shops. A special
booklet issued for the fiftieth anniversary celebration of
the founding of his firm so offended Wiirttemberg offi-
cials and representatives of the Nazi Party, because it
contained no laudation of Hitler, that they returned their
invitations to the jubilee. When Hitler visited Stuttgart
in 1938 shortly after he had annexed Austria, Bosch
demonstratively refrained from congratulating him on
his coup.
For Robert Bosch, too, events proved stronger than
his personal wishes, and his concern became one of the
top defense plants in Germany during the war. The cele-
bration of his eightieth birthday on September 23, 1941,
brought an unusual conglomeration of speakers to-
gether: on the one hand Robert Ley, who announced
Hitler's appointment of Bosch as Pioneer of Labor, and
11. Cf. Chapter Twelve, p. 245.
229
 TYCOONS AND TYRANT

representatives of the Wiirttemberg Nazi government;

on the other Bosch's intimate friend Paul Reusch, known
opponent of the regime, Karl Gordeler, the titular head
of the resistance movement, and Hjalmar Schacht, now
also allied with the conspiracy against the regime.
Bosch's death early in 1942 spared him the grief of see-
ing most of his work laid in ruins by enemy bombs. But
it also spared him the continuous harassment which his
leading associates suffered after the abortive attempt on
Hitler's life on July 20, 1944, because their opposition-
and that of their late chief-was well known and their
implication in the plot was considered more than likely
since Gordeler had been frequently seen entering the
administration building.
Hugo Eckener, whom America fondly dubbed the
Columbus of the Air, minced no words in his Zeppelin
plant at Friedrichshafen as to what he thought of Hitler
and his regime. Like so many others in charge of im-
portant undertakings, he deemed it expedient, however,
to urge his son Knut to join the Nazi Party in order to
forestall the appointment of a commissar for the Zeppe-
lin works. Knut Eckener as manager of the plant re-
mained in control and he, his father and the staff of
faithful workers who had shared the ups and downs of
the Zeppelin projects could continue their work until
Hermann Goring had his revenge on the plain-spoken
old Doctor by ordering the destruction of the sole sur-
viving lighter-than-air, semi-rigid airship, the "Graf
Zeppelin."
Paradoxical as it may seem, one must also count Fritz
Thyssen among those who resisted Adolf Hitler and his
henchmen actively.
When Hitler called together his yes-men's Reichstag
on September 1, 1939, to inform it that he had decided
to "meet force with force" in Poland, Thyssen alone of
230
 COMPLIANCE AND RESISTANCE

all the six-hundred-odd members had the courage to

wire that he was against the war. He would have flown
to Berlin to cast his negative vote, he telegraphed, ex-
cept for the fact that he was in poor health and under
medical care at Bad Gastein near Salzburg.
He followed his telegram a few days later with a letter
to Goring, in which he stated, inter alia:
I am not only entitled, I am obliged to express my views,
particularly when I am convinced that Germany is being
led into grave disaster. . . . Now as before )[ am against
the war. As the war has already started, Germany ought to
try to put an end to it as soon as possible, for the longer
it lasts, the worse will be the peace terms for Germany. It
is not Poland that broke the pact with Germamy. . . .
In the meeting of the Reichstag on September I, approx-
imately one hundred members were absent. Their seats were
taken by Party officials. This I consider a mockery of the
constitution, against which I protest. I demand that the
German public be informed that as a member of the Reichs-
tag I have voted against the war. Should the1re have been
any more members who voted as I did, their votes, too, are
to be made public.
By this time Thyssen was across the German border,
beyond the reach of the Gestapo. As he explained in a
subsequent letter to Gauleiter Terboven, he had learned
from the events of June 30, 1934 (the so-called Rohm
revolt), what fate was in store for anyone: who dared
speak up against the regime. The Nazis revenged them-
selves in Thyssen's case by confiscating all his property
and other assets in Germany. The same Baron Kurt von
Schroder who had brought Hitler and Papen together
at his home was appointed trustee for the Thyssen
estate.
In a long final letter to Hitler, Fritz Thyssen wrote in
part:
231
 TYCOONS AND TYRANT

I want to recall to your mind the fact that when you sent
your Mr. Goring to the Holy Father in Rome and to the
Kaiser in Doom, his mission surely was not to prepare them
both for your impending alliance with communism. And
yet, you suddenly concluded this alliance, and you thus
committed an act that nobody would have condemned more
strongly than yourself. See pages 740-750 in your book Mein
Kampf.
Your new policy, Mr. Hitler, is driving (;ermany into an
abyss and the German nation into perdition. Tum back as
long as it is still possible. Your policy will terminate in a
finis Germaniae. Think of the oath you sw·ore in Potsdam.
Give back to the Reich a free parliament, give back to the
German nation freedom of conscience, freedom of thought,
and freedom of speech. Create anew the foundations which
are necessary to restore law and justice, vvhich will make
it possible to trust a German treaty again. Stop the useless
bloodshed and Germany will obtain peace with honor, and
will thus preserve her unity.
Hitler replied by canceling Thyssen's citizenship.
Later, when the Germans occupied all oJf France, Thys-
sen was seized on the Riviera and placed in a concen-
tration camp. By an irony of fate he was re-arrested by
American officers as an ardent Nazi. Whatever his guilt
in bringing Hitler to power, he was manly enough to
admit his mistake and to pay heavily for it.

Thyssen's action at the beginning of the war was paral-

leled toward the end by a group of men, at first enthusi-
astic followers of Hitler, who prevented the carrying out
of his scorched earth policy as he ordered it applied to
industrial plants. This will be discussed in its proper
place in the chapter following.
Bold men in industry did succeed in a1rresting Hitler's
nefarious course here and there. Many Jews were pro-
tected or helped out of the country by their Christian
232
 COMPLIANCE AND RESISTANCE

colleagues or employers. Many persons employed in in-

dustry who were arrested by the Gestapo were freed
again by their superiors or friends. Many tycoons simu-
lated acquiescence while at the same time scheming suc-
cessfully to contravene senseless or inhumane Nazi
orders.
This fragmentary account of resistance in German
industry shows that, on the whole, it was only the most
powerful and oldest captains of industry who could in-
dulge in the luxury of open defiance of Hitler. The exist-
ence of a ubiquitous state police postulates that, except
in rare instances, resistance must needs remain under-
ground. Any indication of it, be it ever so slight, is
quelled immediately. Men like Bosch or Biicher or
Krupp in their exalted positions could take a risk with
a certain probability of not being annihilated. For their
less influential colleagues physical destruction loomed as
the only alternative.
If heroism was shown it had to be anonymous. For
this reason, in judging the attitude of a population in a
totalitarian state, it is essential to avoid drawing conclu-
sions from the lack of external evidence as to the exist-
ence or non-existence of active opposition to tyranny.
The loyalty evinced in so many instances by others
toward men who willingly or unwittingly through some
word or deed exposed themselves to the wrath of the
regime justifies the assumption that the opposition to
Hitler encompassed broad strata of industrial manage-
ment and labor. In the overall appraisal of the period
it is wrong to paint in black and white only. Circum-
stances were as varied as is human psychology. One can-
not treat as negligible the cases of firmness in opposing
the regime and willingness to risk dire consequences
which have become a matter of record. They were symp-
233
 TYCOONS AND TYRANT

toms of a widespread anti-Nazi sentiment in German

industry.
In view of the facts presented, the comment of a high
official in Washington whom I consulted before leaving
for Germany in June 1952 assumes added significance.
This man served his country in a highly sensitive posi-
tion during the Roosevelt and Truman administrations
and has been retained by President Eisenhower. His
knowledge of Germany is intimate. He commented:
By and large, I believe German industry acted not dif-
ferently from the way American, British, French, or any
other industry would have acted under similar conditions.
The German industrial leaders were not worse than those
of other countries, but they faced a situation which the
leaders in no other industrialized nation had to face. They
did the best they could.

234

, ..
CHAPTER TWELVE

Forced Labor, Spoliation,

and Scorched Earth

By the time Hitler had declared war on Poland, there

was only one group left which could possibly bring an
end to the Nazi regime: the Wehrmacht. When one
studies the history of the plot to assassinate Der Fuhrer
which culminated in Colonel Claus Schenk von Stauffen-
berg>s abortive attempt of July 20, 1944, one is struck
by the fact that the civilians behind the conspiracy di-
rected their efforts chiefly at convincing Wehrmacht of-
ficers in strategic positions that it was their duty to save
the Fatherland-nobody else could.
We have already noted that the promulgation of the
Law for the Defense of the Realm in May 1935 was par-
alleled by a secret decree which was never published. 1
It placed all industry directly under a Plenipotentiary
for Economy and all civil service under a Plenipotentiary
for Administration. It was of brief duration, however,
for Hermann Goring was put in charge of the so-called
Four Year Plan the following year. He was given specific
authority "to issue decrees and general administrative
regulations and is empowered to give orders to all gov-
1. Cf. Chapter Eleven, p . 219.
235

..
--'
 TYCOONS AND TYRANT

ernment departments including the highest federal of-

fices.~'
Two years later, on June 6, 1938, Goring's dictatorial
powers were further increased by a Decree Regulating
the Procurement of Labor for Tasks of Importance to
the Policies of the State. It empowered him to dispose
of labor as he pleased, even though it ,w-as already en-
gaged elsewhere. He could thus bring to his knees any
recalcitrant entrepreneur who might wa1ilt to attempt to
fall behind in the defense effort, by silnply taking his
workers away from him, if not by other means.
As though the sweeping powers thus far granted were
not sufficient, Hitler on August 27, 193H-five days be-
fore he declared war-issued an ukase by which all eco-
nomic measures were to be determined by a central
authority operating regionally through functionaries
known as Defense Commissars. This "'as followed on
August 30 by a decree establishing a Council of Ministers
for the Defense of the Reich with powe1r to issue orders
having the validity of laws.
One would suppose that by this intricate command
structure the regime had fortified itself against any even-
tuality of opposition. But the worst was yet to come. It
will be recalled that Hitler had already taken personal
charge of the Nazi military effort. On April26, 1942, he
ordered his Reichstag to give him specifi.c powers of life
and death also over all German civilians. Hitler con-
trived to clothe each of his acts in legality. The law
which was passed without a word of discussion stated:
The F ilhrer must have all the rights demanded by him to
achieve victory. Without being bound by existing legal reg-
nations . . . [he] must be in a position with all the means
at his disposal if necessary to force every 1German to fulfill
his duty, whether he be a common soldier or an officer, low
236
_.,...- ...
• .A
 FORCED LABOR

or high official or judge, leading or subordinate functionary

of the Party, worker or employer. In case of violation of
these duties the Fuhrer is entitled, regardless of existing
rights, to mete out punishment and remove the offender
from his post, rank and position without introducing pre-
scribed procedures.2
Seldom in modem times has naked tyranny been
couched in such specific juridical language.. Hitler was
far too absorbed with running the war fro1n his lonely
hideouts, to which fewer and fewer people were ad-
mitted, to pay much attention to civilian life. His prae-
torians, therefore, arrogated the powers inherent in Hit-
ler's unique position to themselves. They rolled brutally.
Industry felt the heavy hand of absolutist dictatorship
no less than did other sectors of German life. The De-
fense Commissars saw to it that a representative of the
SD (Security Service of the Gestapo, i.e., Sicherheits-
Dienst) was placed in every plant to make sure that
there was no sabotage. As the world conflict progressed
and more and more Germans were sacrificed, plants
were again and again combed out for additional human
material to send to the fighting front. Plant managers
were often at their wits' end to fulfill the prescribed
production quotas (failure to achieve whlich entailed
dire punishment) when their skilled workers; were taken
away from them. While they had been able to effect the
release of their men when taken to concentration camps
during the early stages of the war, they could do nothing
to prevent the drafting into military service of employees
whom they considered indispensable for their plants.
Then began the period of which one of the most bril-
liant German defense attorneys, Rudolf Dix:, who func-
tioned in various Niirnberg trials, said in one of his
2. Nurnberg Documents 1,961-PS.
237
 TYCOONS AND TYRANT

pleas, ccThe Third Reich compelled everybody to do un-

godly things." These "ungodly things" comprised chiefly
two actions which were later adjudged in the Niim-
berg Military Trials as criminal: the employment and
inhumane treatment of "slave labor," and the spoliation
of foreign plants in conquered countries.
I am the last one to defend forced labor at the point
of the conqueror's bayonet, or the inhumane treatment
of anybody, friend or foe, or the acquisition, under the
euphemism of war booty, of industrial undertakings. But
I believe it only fair to try to recapture the situation
which the German industrialists faced from September
1939 to the end of the war, so that we may the better
understand-though not condone-the inhumanities of
this gruesome period and the seeming readiness to ag-
grandize at the expense of a defeated competitor.
- During the first two years of the war, Hitler's military
successes followed one after another with such dazzling
rapidity and with such negligible loss of men that the
problem of filling the gap in defense production plants
caused by the draft was not acute. After the first great
setback in Soviet Russia during the winter of 1941-42,
however, another look had to be taken at the man-power
situation.
Albert Speer, the new Minister for Armaments and
Munitions, found himself in hot water with the Gaulei-
ters in various regions, who had friends to protect from
the labor draft or, as happened in some cases, were
bribed by industrialists to leave certain men in non-
essential undertakings. These Gauleiters failed to deliver
the contingents expected from them. Speer therefore
craftily suggested to Hitler that a man of Gauleiter rank
be appointed Plenipotentiary-General for Man-Power.
Such a "toughie" was found in the person of bull-necked
Fritz Sauckel, the Gauleiter for Thuringia. Sauckel was
238
 FORCED LABOR

appointed in March 1942 with instructions to mobilize

the human material of the occupied areas for the Ger-
man defense industry so that it might take the place of
German labor urgently needed at the front as soldiers.
A phase in German history began of which Alfried
Krupp von Bohlen said in his interview in the London
Sunday Express of March 22, 1953: s
It was a terrible chapter. But we were compelled to accept
forced labor like other German industrialists. Under such
conditions bad things happened.
What could industry have done other than to accept
the foreign workers? A Rimmler decree making the em-
ployment of slave labor compulsory stated laconically
that anybody contravening it "would receive separate
treatment." That meant, to every German, "liquidation."
The twenty-page decree issued in Hitler's name was sig-
nificantly marked "not for publication."
Unless an entrepreneur was willing to be stood up
against the wall and shot for disobedience, he "became
the mere executing organ of a central offi.ce [that of
Albert Speer] which steered the production. . . . A
manager had no influence whatever upon the produc-
tion programs," as Franz Hayler 4 testified in the Fried-
rich Flick trial. Continuing, Dr. Hayler said:
The chairman of any board could nowise exert influence
upon the manner of employing labor nor upon the employ-
ment of foreign workers.
Similarly Jakob Reichert 11 replied emphatilcally, when
asked as a witness in the Flick trial, whether the indus-
trialists in his group had any possibility of exerting an
3. Cf. Chapter Ten, p. 201.
4. Tribunal IV, Case V, Dokumentenbuch III.
5. Cf. Chapter Ten, p. 196.
239
 TYCOONS AND TYRANT

influence upon the disposition of labor J?Ower, ccNo, not

the least, not the least.,
Walter Rohland, the cctank king,, testified that the
workers were assigned directly by the federal labor of-
fices and the Defense Commissars (under Sauckers
supervision).
Ernst Tengelmann, director-general of a number of
Ruhr coal mines, stated under oath that Sauckel and
his offices for the deployment of labor vvere responsible
exclusively for the allotment of foreign workers. Every
pit, he testified, had to report how much man-power it
was lacking, and the necessary number of workers was
then supplied. The only latitude for the mine operators
was that of deciding whether they wanted prisoners of
war or civilian foreign workers.
In short, there is no reason to doubt that forced labor
was imposed dictatorially by the regim~e. Industry had
no choice.
In this connection a passage from the judges' verdict
in the IG Farben trial is very much to the point:
The defendants here on trial have invoked what has been
termed the "defense of necessity." They say that the uti-
lization of slave labor in Farben plants w·as the necessary
result of compulsory production quotas im]posed upon them
by the government agencies, on the one hand, and the
equally obligatory measures requiring them to use slave
labor to achieve such production, on the other. Numerous
decrees, orders, and directives of the Labor Office have been
brought to our attention, from which it appears that said
agency assumed dictatorial control over the commitment,
allotment, and supervision of all available labor within the
Reich. Strict regulations prescribed almost: every aspect of
the relationship between employers and e:mployees. Indus-
tries were prohibited from employing or discharging la-
borers without the approval of the agency. Heavy penalties,
240
 FORCED LABOR

including commitment to concentration camps and even

death, were set forth for violations of these regulations. . . .
This tribunal is not prepared to say that these defendants
did not speak the truth when they asserted that in con-
forming to the slave labor program they had no other choice
than to comply with the mandates of the Hitler government.
There can be but little doubt that the defiant refusal of a
Farben executive to carry out the Reich production sched-
ule or to use slave labor to achieve that end would have
been treated as treasonous sabotage and would have re-
sulted in prompt and drastic retaliation. Indeed, there was
credible evidence that Hitler would have welcomed the
opportunity to make an example of a Farben leader.
The "defense of necessity" was therefore :admitted in
the IG Farben and Flick trials and a number of the in-
dicted men were acquitted of the slave labor charge; it
is inexplicable why it was ruled out in the ][(rupp trial.
The judges, of course, in all three industrial trials were
different.
But while permitting the "defense of necessity," the
judges did not permit the atrocities committed in the
IG Farben plants near Auschwitz to go unpunished.
They found that the treatment of workers there
was not entirely without inhumane incidents. ~Occasionally
beatings occurred by the plant police and supervisors who
were in charge of the prisoners while they were at work.
Sometimes workers collapsed. No doubt a condition of un-
dernourishment and exhaustion from long hours of heavy
labor was the primary cause of these incidents. Rumors of
the selection made for gassing from among those who were
unable to work were prevalent. Fear of this fate no doubt
prompted many of the workers, especially Jews, to continue
working until they collapsed.
The court accordingly found three of the IG Farben
defendants guilty of a crime against humanity.
241
 TYCOONS AND TYRANT

The foisting of "slave labor~" upon c;erman industry

did not occur without a struggle. Hermann Roehling and
Walter Rohland were Fuhrer and Deputy Fuhrer, re-
spectively, of the Iron Industry Group. Both vigorously
opposed the employment of foreign forced labor in Ger-
many.6 They urged that foreign labor he imported only
on a voluntary basis.
Rohland went a step farther. In every talk with Albert
Speer he sought to convince him that his viewpoint was
right. He then put all his arguments together in a report
which went the round of all Gauleiters a.nd was also sub-
mitted to Hitler~s aid, Martin Bormann.
During the Nfunberg trial of Friedrich Flick, Walter
Rohland gave a comprehensive resume of his report. He
said, in part:
As early as 1941 and again in 1942 I called the attention
of Messrs. Todt and Speer in an unmistakable manner to
the fact that it was essential under all circumstances to do
what was being done in England, America and Russia, viz.,
to make use only of our own nationals, of ~Germans, because
in that way alone would it be possible to bring the unfor-
tunate war to a relatively favorable conclusion. On the basis
of statistical material I pointed out that between 1935 and
1939 the number of civil service employees ( Beamten) had
increased by 1.9 millions, so that in this sector alone there
were vast reserves of human material available . . . . My
proposals, which were endorsed 100 per cent by my col-
leagues, unfortunately were not heeded.
When it became more and more evident in 1943 that the
calls for volunteers met with no response, and when the
attempt was begun to compel foreign workers to come to
Germany, I took issue in even sharper form with these
methods, being supported therein by my colleagues. No
conference with Speer passed by without my reverting to
this problem . . . .
6. Cf. Chapter Eleven, p. 217.
242
 FORCED LABOR

My report was divided into three parts. In the first I

turned unequivocally against the employment of foreign
workers on moral, ethical and economic grounds. I was will-
ing to approve of foreign labor only if employed on a com-
pletely voluntary basis. Morally and ethically forced labor
could not be justified, because in my opinion one cannot
and must not compel citizens of any enemy state to work
against their own fatherland. Various arguments of an eco-
nomic nature spoke against their employment.
In the second section of my report I tried to prove that,
if one included the prisoners of war, there were actually
enough workers and human beings in Germany who if
rightly deployed and allowing for proper production for
the civilian sector could satisfy all demands of industry. . . .
In the third part . . . I made practical proposals as to
the sectors from which Germans could be mobilized and
what methods should be employed in so doing. . . .
Copies of the report were sent to Sauckel, Ley and Gob-
bels. On Speer's advice I conferred with Sauckel and Ley
in December 1943 and January 1944. Here, too, no result
was achieved. Sauckel declared my ideas were utopian. Ley
demanded my immediate removal from all my offices and
from my job. Speer's intervention alone enabled me to keep
my position. . . .
Despite this rebuff I sent the Denkschrift to Bormann and
Goring. . . .
May I add that my report was also sent to at least twenty
of my colleagues; that all details were discussed with my
colleagues in the Ruhr; that all these men without excep-
tion approved of my stand and in every way supported me
in my rather dangerous undertaking.
The defense counsel in the course of the cross-exam-
ination posed this question:
I take it, then, that [German] industry not only did not
ask for the forced employment of foreign labor, but on the
contrary through you approached the government with pos-
243
 TYCOONS AND TYRANT

itive suggestions for doing away with slave labor, and that
these proposals failed of adoption by a personal decision
on the part of Hitler?
To this Rohland replied, "your interpretation in every
way corresponds with the facts.''
Rohland was overruled. Bormann rej'e cted the report
outright. The Gauleiters, under heavy pressure to see
the fulfillment of production quotas, thought they could
not forego foreign forced labor. Hitler sided with Bor-
mann and the Gauleiters. Fate took its evil course.
It goes without saying that German industry could
regard prisoner-of-war and civilian forced labor at best
only as a lesser evil compared with no labor at all. To
understand this fully, the structure of (;erman industry
must be taken into account: its reputation for quality of
workmanship and excellence of product stems partly
from the fact that the labor turnover in c;ermany is much
smaller than in many other industrialized countries.
Gennan concerns are proud of their Sta.mrrwrbeiter, i.e.,
ripened, experienced, reliable men and '.vomen who con-
stitute the core, or "stem," of the work~ers employed. It
was naturally a bitter pill which the entrepreneurs had
to swallow when these Stamrrwrbeiter and even their
more lately-arrived German workers vvere taken from
them to serve in Hitler's armed forces, and in their places
strangers conversing in foreign, often unfamiliar, tongues
were dumped into factories by the carload for the fore-
man to assign to jobs.
Undoubtedly there were heartless ernployers who ex-
ploited these unfortunates cruelly. That was inevitable
in Germany as it would have been in any other country.
It is also true, however, that a considerable number of
German industrial leaders did everything they could to
ameliorate the lot of their fellow humans who were as
244
 FORCED LABOR

little responsible for their assignment in G·ermany as

were these German employers for taking then1 on.
For instance, when the first consignment of Soviet
slave workers reached the Volkswagen plant at Wolfs-
burg, Ferdinand Porsche was appalled at the physical
condition of the men. He had every one of them exam-
ined by his company physicians and then gathered all
the medical reports in a book which he took to Hitler"s
GHQ.
~'Is it your desire that human beings should sink so
low?" he asked the astonished Fuhrer. lie actually
wangled an order out of him by which the ~7olkswagen
plant was authorized to feed the Russian workers as well
as the native Germans were fed.
I have taken pains to speak to Krupp workers em-
ployed in the Essen plants at the time when foreign
workers were assigned there by Sauckel. They assured
me that the foreigners were treated as well there as the
German workers. The Krupp attorneys submti tted volu-
minous material in evidence to prove this point, but the
judges, H. C. Anderson of Tennessee, Edward J. Daly
of Connecticut, and William J. Wilkins of the State of
Washington, denied the indicted Krupp executives the
"defense of necessity" and made no mention in the ver-
dict of the fact that the defendants had often endeavored
to better the lot of the foreign workers.
As an example the case of Friedrich Ihn, Jmember of
the Krupp directorate in charge of personnel, may be
cited. He was persecuted by the Gestapo for having
made large-scale purchases of vegetables from farmers
for feeding the foreign workers. Only the personal inter-
vention of Alfried Krupp saved him from arrest.

In the coal industry of Upper Silesia general protest

was raised against the employment of concentration
245
 TYCOONS AND TYRANT

camp inmates as miners. It must be 1remembered that

the concentration camps were filled not only with men
and women considered politically dangerous or upon
whose family trees racially undesirable scions had been
engrafted, but also of homosexuals, cri1minals and ne~er-
do-wells. The coal industry contended that it was a re-
flection upon an honored German profession to send
doubtful elements to work shoulder to shoulder with one
of the stablest elements in the Silesian population. The
operators won out and only relatively few concentration
camp inmates were allocated. These \\rere put to work,
however, not to dig coal but to perform such tasks as
helping to build a power plant.
Numerous affidavits were introduced during the Flick
trial to prove that an effort was made by the coal indus-
try of the Ruhr to treat the forced foreign labor, both
prisoner-of-war and civilian, as fairly as was possible
under the prevailing circumstances. A.s an example of
this endeavor, I quote from the sworn statement of Ernst
Tengelmann:
All foreigners were lodged in stone or wooden barracks.
In constructing their housing, special attention was paid to
health and livableness. All barracks had \VCs and lavatories.
The food was supplied by the Essen bituminous coal com-
panies. The meals were served in conr1munity kitchens.
Rations were determined by the governrnent and care was
taken that the authorized quantities were fully handed out
to the foreign workers and prisoners-of-\\l'ar. In addition to
the official rations, vegetables and potatoes were served. To
make sure that food was always available, installations for
drying vegetables were provided which \N'ere constantly in
use.
Medical care was provided by camp doctors. In all bar-
racks camps there were medical consultation rooms with
proper equipment. German nurses and medical assistants
246
 FORCED LABOR

were provided. In the case of Russian PWs, Russian medical

staff officers were used. In the event of serious illness, hos-
pital care was provided.
Among the foreign civilian workers there were a number
of families. These families, consisting of men, 'Women and
children, were permitted to remain together and to work in
the same pit. Greatest care was taken to insure the safe
delivery by expectant mothers. Small children were care-
fully looked after. Children received fresh milk and chil-
dren's food exactly the same as German children of like age.
Women were employed only in light surface work. The
administration always emphasized and issued instructions
to all who were charged with employment matters that PWs
and foreign workers were always to be treated decently and
humanely. 7
The evidence, of which this is a sample, convinced
the judges in the Flick case that "cruel and appalling
methods" of treatment were not applied in the Flick
Concern and that Friedrich Flick and his associates were
earnestly concerned to introduce measures "'calculated
to insure humane treatment and good working condi-
tions." The judgment continued:
This is substantiated by the fact that the plant managers
with whom the defendants had contact were d)[sposed and
determined to do whatever was in their power to provide
healthy quarters for these workers, to furnish them not only
better but also more plentiful food than was perrnitted under
the government regulations, and to give thern adequate
medical aid and sufficient leisure time and rec1reation.
It cannot be denied, nevertheless, that many a case is
on record to bear out the truth of Alfried :Krupp von
Bohlen's statement, "It was a terrible chapter. . . . Bad
things happened." I am here concerned, ho\~ever, that
7. Flick Document No. 32.
247
 TYCOONS AND TYRANT

those men in German industry be given proper credit

who sought to ameliorate the lot of the forced workers
assigned to them by a regime much m01re powerful than
themselves. The story of entrepreneurs and managers
in whose plants "ungodly things"' happened has been
told and retold in the trials and by the press, hence needs
no elaboration by me.
To give an impression of the nature of the pressures
applied, the following order by Fritz Sauckel, issued
April20, 1942, should serve well as an illustration:
All the men must be fed, sheltered and treated in such a
way as to exploit them to the highest possible extent, at
the lowest conceivable degree of expenditure.
The term ''slave work" is elastic. Thus, the American
government did not hesitate to tum over 320,000 Ger-
man prisoners-of-war to the French government for
forced labor in France. There they wo:rked under con-
ditions to which the American govemm~ent felt impelled
to direct the attention of the authorities in Paris. Also,
Proclamation No. 2 of the Control Council, issued Sep-
tember 20, 1945, in Article VI, subhead 19a, stipulated:
The German authorities will carry out, for the benefit of
the United Nations, such measures of restitution, reinstate-
ment, restoration, reparation, reconstruction, relief, and re-
habilitation as the Allied representatives mtay prescribe. For
these purposes the German authorities .. .. will provide
such transport, plant, equipment, and materials of all kinds,
labor, personnel, and specialist or other services, for use in
Germany and elsewhere, as the Allied representatives may
direct. (The italics are mine. )
The Russians promptly took advantage of this provi-
sion and sent 200,000 German workers to do forced labor
in the Soviet Union. They did not hesitate to compel
248
 FORCED LABOR

German women to work in Soviet mines and in steel

plants.

The spoliation of foreign plants is something of which

no regime which orders it and no concern which carries
out the order can be proud. The ccdefense of necessity"
was not admitted in the three Niimberg trials for de-
fendants charged with having participated in spoliation.
In the IG Farben trial, ten of the thirteen defendants
were accordingly found guilty of violating the Hague
Regulations of 1907; in the Krupp trial, six of the twelve
defendants; and in the Flick trial, one of the six de-
fendants.
Among many Germans whom I have encountered in
the course of my researches there is bitter resentment
over these verdicts. Not that they approve of spoliation.
Were spoliation condemned universally, the judgment
of the American Military Courts at Niirnberg would
probably be accepted as fairly and justly based on Article
46 of the Hague Regulations ("Private property must
be respected. . . . Private property cannot be confis-
cated''), and on Article 47 of the same regulations ("Pil-
lage is formally prohibited").
The questions asked of Americans are:
1. If "private property must be respected," why was
the sale of private German factories and other properties,
of patents, literary rights, and trade secrets pursued with
vehemence by the Office of Alien Property in Washing-
ton and halted only in 1953 as a result of the visit of
Chancellor Konrad Adenauer?
2. If "pillage is formally prohibited," how explain that
the wholesale carrying away by the victors of German
industrial installations which could not possibly be con-
sidered as being of military use was considered permis-
sible?
249
 TYCOONS AND TYRANT

What should Americans thus challenged answer other

than saying that two wrongs do not make a right?

Especially hurtful to American prestige was the fact

that Alfried Krupp von Bohlen was singled out for con-
fiscation of his entire possessions. It seemed incredible
that judges from the country that boasts of being the last
dependable bulwark of private enterprise and private
property should have arrived at such a verdict. To the
credit of the presiding judge, H . C. Anderson, it must
be said that he opposed the confiscation. He was out-
voted by his two associates.
John J. McCloy, who succeeded General Lucius Clay
as American High Commissioner in Germany, soon real-
ized the incongruity of the American position. He also
was aware that the judgments in the three industrial
trials were not beyond reproach. He therefore coura-
geously released the condemned industrialists on Febru-
ary 3, 1951, and ordered Krupp's fortune restored to
Alfried Krupp von Bohlen.
A howl of indignation went up, especially in England.
McCloy was represented as condoning Nazism. He did
nothing of the sort. No High Commissioner could have
been more earnest in his endeavor to give encourage-
ment to the democratic forces in Germany and to help
eradicate the last traces of Nazism than John J. McCloy.
His reasoning was clear and cogent. He argued :
This is the sole case of confiscation decreed against any
defendant by the Ni.irnberg courts. Even those guilty of
personal participation in the most heinous crimes have not
suffered confiscation of their property and I am disposed to
feel that confiscation in this single case constitutes discrim-
ination against this defendant unjustified by any considera-
tions attaching peculiarly to him. General confiscation of
property is not a usual element in our judicial system and
250
 FORCED LABOR

is generally repugnant to American concepts of justice.

I would point out that . . . I am making no judgements
as to the ultimate title to the former Krupp property. The
property of Firma Friedr. Krupp will be subject to AHC
Law Number 27, "Reorganization of the German Coal, Iron,
and Steel Industries," and is not affected by this decision.
Before the property was actually returned in April
1953, Alfried Krupp von Bohlen had to sign a pledge to
the Occupation Powers by which he promised to keep
forever out of the coal, iron, and steel industries in Ger-
many, to sell his holdings in these branches within five
years, and to confine himself to the manufacturing of
finished goods, the building of ships, railway locomo-
tives, motor trucks, and any other business ventures ex-
cept coal, iron, and steel production.
Typical of British criticism of McCloy's action were
Letters to the Editor in English dailies which held, for
instance, that "to 'compensate' Herr Krupp for anything
he lost because in fact Germany lost the war is a deadly
insult to those millions who suffered and died in two
world wars." Or, "It would appear that the Allied Powers
in Western Germany have now decided to make Herr
Alfried Krupp one of the richest . . . men in Europe."
Both show confusion of thought. McCloy did not
"compensate" Herr Krupp. His action was to restore to
the Essen tycoon what had been seized in a uniquely
discriminatory way. Nor did he decide to "make Alfried
Krupp one of the richest men in Europe." We shall be
better able to judge how rich Alfried Krupp von Bohlen
is after the German tax authorities get through with him,
the accumulated obligations have been paid off, pensions
for the 18,000 retired Krupp workers have been provided
for, the repair and modernization of the plants left to
him have been financed, and the losses on the forced sales
of his steel and coal interests have been discounted. But
251
 TYCOONS AND TYRANT

that was not the American High Commissioner's respon-

sibility or worry.
Alfried Krupp von Bohlen is still a ve:ry wealthy man.
He is lucky that as much has remained of the Krupp
empire as did. In that respect he is more fortunate than
the hundreds of thousands of German evacuees and ref-
ugees from Germany,s lost eastern provinces and the
Russian Soviet Zone of occupation who reached the west
with nothing except what they had on their persons or
could carry without being looted. But John McCloy had
nothing to do with the accumulation or later reduction
of the Krupp fortune. He handed it back because that
was the moral and American thing to do. The responsi-
bility for the administration of the Krupp fortune again
rests with Herr Alfried. It is a tremendous moral chal-
lenge.

When the war was almost over, Adolf Hitler, obsessed

with the idea of drawing all Germany into the abyss with
himself, issued several insane decrees. On March 19,
1945, he ordered the destruction of all power and utility
plants. If carried out, it would have put all Germany in
darkness, stopped all electric railway traffic, and ended
production in all plants dependent on ~electric current.
He also "issued categorical and detailed orders for the
destruction of all communications, rolling stock, lorries,
bridges, dams, factories, and supplies in the path of the
enemy.,, 8
Albert Speer, who for weeks had been trying to dis-
suade his master from so catastrophic a course and had
even set forth his reasons in a memorandum which Hitler
locked away in his safe unread, was sunnmoned by Der
Fuhrer and told :
8. Alan Bullock, op. cit., p . 707.
252
~··
 FORCED LABOR

If the war is to be lost, the nation will also perish. This

fate is inevitable. There is no need to consider the basis even
of a most primitive existence any longer. On the contrary,
it is better to destroy even that, and to destroy it ourselves.
The nation has proved itself weak, and the future belongs
solely to the stronger Eastern nation. Besides, those who
remain after the battle are of little value; for the good have
fallen. 9
Speer now showed impressive courage. He took steps
to thwart Hitler's orders for a scorched earth policy.
In this he was supported by Walter Rohland, the armor
expert, and Otto Steinbrink, then in a leading position
with the United Steel Works. Many others followed their
example and also sabotaged the Hitler ukase.
Hitler's mad decrees further ordered the destruction
of all coal mines in the Ruhr Valley. This would have
meant an irreparable loss not only to Germany, but to
western Europe with its dependence on Ruhr coal for
coking purposes. It would have made beggars of hun-
dreds of thousands of miners.
To prevent such nihilistic madness, Martin Sogemeier,
executive director of the Northwest Organization of
Economic Representatives, risked his life. He happened
to be motoring from Berlin to the Ruhr region in the
car of Paul Pleiger, who was in high favor with the
regime as director-general of the Hermann Goring
Werke at Salzgitter. 10
Sogemeier remembered that Pleiger was a miner's son.
Could he risk speaking to him frankly? After all, Pleiger
was an ardent Nazi. If he felt that the Fuhrer's word was
law, no matter how insane, would he not report him to
the Gestapo for insubordination and defeatism, in other
9. Nii.rnberg Documents, part XVII, p. 35.
10. Cf. Chapter Nine, p. 175.
253
 TYCOONS AND TYRANT

words, deliver him to the hangman? Sogemeier decided

to take the risk.
"Are you aware what it will mean to blast all coal
pits?" he asked Pleiger as they paused to take in gas.
"What will that lead to? You know as well as I do that
they will never again be restored."
"Is that so?" was Pleiger~s only comment. Then, to his
chauffeur, <<Let~s go. ~~
Sogemeier racked his brains wondering what Pleiger's
words meant. He spent a sleepless night. The next morn-
ing Pleiger, too, confessed he had little or no sleep. He
then drove from mine to mine with Sogemeier, called
together the inspectors, told them of Hitler's orders to
the Gauleiters to blast the pits, and ended with :
That simply must not happen. I herewith forbid you to
hand out any dynamite to any political functionary. I'm
returning to Berlin at once.
Thus two determined men prevented a major catas-
trophe to Europe.

Again I yield the floor to General Thomas. In his

article entitled, "Concerning the War Guilt of German
Wirtschaft/' he wrote:
Once the war had broken out and the fatherland was in
greatest danger, there naturally remained no other possi-
bility for industry except that of doing its duty toward the
fatherland and to supply the Wehrmacht to the limit of its
possibilities. To refuse to fill orders placed by the govern-
ment was less possible in Germany than in any other state,
for the slightest attempt to do so ended on the gallo\vs. . . .
The opposition had but one aim, namely, to end the war
by removing the government by force. For this attempt it
hoped for the cooperation of the leading economic circles,
but unfortunately encountered little understanding there.
254
 FORCED LABOR

It remains a mystery as to why the leading personalities,

with but few exceptions, did not recognize or did not want
to recognize the impossibility of winning the war and made
virtually no attempts to convince the top leadership of the
idiocy of a conflict with the economic power of England,
America and Russia. . . .
It is equally inexplicable how it was possible for the in-
dustrialists, exactly as also the highest military leaders, to
let themselves be duped concerning the existence of "wonder
weapons" that were calculated to decide the war, without
investigating whether there was any truth to it. I admit that
on this point industry was outrageously lied to by men in
Speer's ministry, especially his chief aides, [Karl Otto] Saur
and Schieber.
The activity of German Wirtschaft in the plants of occu-
pied countries needs special investigation. Under the con-
ditions existing in Germany it was impossible for a German
undertaking to refuse to furnish technical aid for starting
production again in a conquered foreign plant. There is no
explanation, however, for the willingness of certain firms
and concerns to acquire by purchase the plants that were
robbed by Goring's order to seize them. I warned every en-
trepreneur who asked my opinion against doing so. Various
ones heeded the warning, while others yielded to tempta-
tion or let themselves be persuaded by Goring or other Party
officials to do so. . . .
The charges leveled against certain firms concerning the
treatment of foreign labor call for further examination, be-
cause it frequently proved impossible for the plants to make
proper arrangements in view of the frequently irresponsible
orders issued by Saur and other officials. . . .
The purpose in writing this article is that of making a
contribution for the Allied and German prosecutors whereby
the decent circles within the German Wirtschaft shall as
soon as possible be cleared of suspicions attaching to them
and shall be able as soon as possible to resume their labors.
Only those men should be punished who in a corrupt
255
 TYCOONS AND TYRANT

manner supported the Nazi system and its exponents, to-

gether with them enriched themselves unduly, before or
during the war violated justice and decency, and, goaded
by egotism and greed for lucre, encouraged and spread the
incitement to war and the psychosis of holding out to the
bitter end.

256

·. · :
CHAPTER THIRTEEN

Whither German Industry?

German industry had practically to start from scratch

after the debacle of 1945. Control Council Law No. 10,
entitled "Punishment of Persons Guilty of War Crimes,
Crimes against Peace and against Humanity,'' gave wide
latitude to the occupation officials to remove managing
personnel. It specified:
Any person without regard to nationality or the capacity
in which he acted is deemed to have committed a crime as
defined in Paragraph 1 of this Article, if he was (a) a prin-
cipal or (b) was an accessory to the commission of any
such crime or ordered or abetted the same or (c) took a
consenting part therein or (d) was connected with plans
or enterprises involving its commission or (e) was a mem-
ber of any organization or group connected with the com-
mission of any such crime or (f) with reference to paragraph
1 (a) [crimes against peace], if he held a high political,
civil or military (including General Staff) position in Ger-
many or in one of its Allies, cobelligerents or satellites or
held high position in the financial, industrial or economic
life of any such country.
The toll of incapacitated managers and entrepreneurs
was especially large in the heavy industries. The Krupp
and Klockner concerns lost all their plant managers, the
Mannesmann Rohrenwerke all but one director, the
257
 TYCOONS AND TYRANT

Hosch company all but a deputy director. Of the lead-

ing Ruhr enterprises only Gute Hoffnungshiitte had a
directorate that remained intact.
Industrial undertakings had to manage somehow with
new and often inexperienced men. At the Krupp Con-
cern, for instance, owing to the imprisonment of Alfried
Krupp von Bohlen and seven directors and deputy direc-
tors, Berthold, Alfried's brother, had to take over.
In the Klockner Concern seventy-five top positions
had to be filled. As these lines are written, only forty-
seven of them have been manned, such is the dearth of
experienced managerial talent.
Decartelization and co-determination further thinned
the ranks of top-flight industrialists. The incentive for
becoming a monarch in the industrial Jrealm is largely
gone, for the empires to be administered are now so
much smaller than in the Hgolden age" of paternalistic
family undertakings, and the powers of the entrepreneur
have been cut severely by the workings of the German
co-determination law ( M itbestimmungsgesetz) in the
steel, iron and coal industries. A triumvirate consisting
of the entrepreneur or business manager, a technical
director, and a director of labor from the ranks of the
trade unions now takes the place of the formerly all-
powerful owner-entrepreneur or director-general. In ad-
dition, the Works Council ( Betriebsrat;), made up of
representatives of the workers and employers of a plant,
has a share in management. One half of the board of
directors in the steel, iron and coal industries consists
of representatives of labor.

This survey of the German industrial situation would

have only historic value if it did not concern itself with
the vital question: where will German industry go from
here? Is it likely to fall for another Hitler in case another
2.58

-------- ------
 WHITHER GERMAN INDUSTRY?

economic crisis arises? Has the present-dlay, chiefly

young generation of entrepreneurs learned from the mis-
takes of the past?
Since the occupation authorities took over immedi-
ately and completely after the collapse of the Reich in
1945, any contribution by German industry to the estab-
lishment of a democratic order could take shape only
slowly and even then only in a strangely modified way.
What with purges, dismantlings, decartelization, and
decentralization, the new generation of industrial man-
agers had to proceed in a spirit of cautious experimen-
tation. In attempting to evaluate the new historic era
one can therefore be governed as yet only by signs and
symptoms. The acid test will come with the advent of
an economic-. depression. We shall speak first of these
signs and symptoms as they manifest themselves in what
might be called the microcosms of the industrialists' nar-
rower immediate interest and then follow them with the
macrocosm or larger perspective concerning their obli-
gations toward the state and the common good.

The younger generation of German indus1trial leaders

has an undisputed mentor in the person of Josef
Winschuh, for many years one of the best known Ger-
man writers on economic subjects, but more recently
turned entrepreneur in the felt industry. They listen to
him as to no other publicist, all the more because he
not only has something to say but is one of their own.
They regard as their guidepost the "Six Theses for Young
Entrepreneurs" drafted by Winschuh and frequently re-
printed. In brief they postulate:
1. The young entrepreneur must have the will to be entre-
preneur with all the consequences resulting frmn his calling
and his task. . . . Without free enterprise there can be no
2.59
 TYCOONS AND TYRANT

political freedom. The destruction of freedom of enterprise

marks the beginning of a process at the end of which is
the totalitarian state which will destroy even the trade
union.. ..
2. The young entrepreneur must systematically school
himself for the public presentation of his task. Aheady there
are six trade union schools and numerous academies for
social science in existence, but as yet no training places for
entrepreneurs as they obtain in the United States. . . .
3. The young entrepreneurs should pra•ctice comradeship
with one another. . . . This feeling of eomradeship must
jump the hurdle of narrow devotion solely to one's own
branch [of industrial activity]. . . .
4. The young entrepreneur ought soon to join the com-
mittees and executive boards of the organilzations represent-
ing his interests and there busy himself. . . . He must, of
course, have a critically alert feeling for sound organization
and not be satisfied with the routine work of societies, fed-
erations and chambers . . . .
5. The young entrepreneur must not pe1rmit himself to be
separated from the worker. . . . It was a political and social
mistake for many entrepreneurs not to have helped make
something constructive out of the W arks Council Law [of
the Weimar Republic] and to have pernflitted its positive
possibilities to fade out. The [new] Works Council Law must
be affirmed all along the line and must be used to bring
about a constantly growing social partners1aip within a given
undertaking. . . .
6. The young entrepreneur should seek contact with the
Third Force. . . . By Third Force are rneant the [white
collar] employees and civil servants, the nnen of the profes-
sions and the craftsmen, the farmers, the educators, and the
men of the cloth; in short, the broad, nnultifarious social
middle class which has been so valuable as the cradle of
good German qualities. . . . Nothing could be more disas-
trous than a new caste spirit based upon a new accumulation
of wealth by the entrepreneurs . .. . The young entrepre-
260
 WHITHER GERMAN INDUSTRY?

neur ... should be filled with a desire to play a role in

his home town, in his district. Participation in communal
parliaments, in the community- and city-councils provide
excellent schooling in public office. . . .
Present-day entrepreneurs have loyally accepted co-
determination in the iron, steel and coal industries. I am
not alone in noting this readiness to give an honest try
to so radical a departure; all Americans who chanced to
visit the Ruhr during my stay there shared my opinion.
Under co-determination the workers> representatives
gain an intimate insight into the financial practices of
the large concerns. No tycoon could today attempt to
divert company funds to a would-be Hitler without their
getting wind of and preventing it.

The National Federation of German Employers' Asso-

ciatio_ns, _one of the most important economic bodies in
llie new Germany, in March, 1953, issued a sixteen-
page document entitled «Thoughts Concerning a Social
Order., In a brief foreword the president, Walter Ray-
mond, states that "the National Federation hopes, yes
is convinced, that the great majority of the German peo-
ple will understand and endorse these our principles.~>
I quote a few pertinent sentences to indicate the
mentality of the men who guide the destinies of this
powerful body:
Our Christian-Occidental culture is based on the recog- \
nition of the dual nature of the human being as a responsible '.
individual and as a creature with social obligations, due to . )
an immutable order of creation. This perception points the
way to a just social order. . . .
The German entrepreneur, himself an essential part of
the social order, believes in the fundamental right to free-
dom for every citizen in the political realm: protection of
261
 TYCOONS AND TYRANT

personality, freedom of opinion, freedom of the press, free-

dom of assembly, equality before the law . . ..
The German entrepreneur believes equally ardently in
the social and economic fundamental rights of the individ-
ual: security of employment, the right to vacation and rec-
reation, the right for mothers to be protected, the right to
economic security in old age, in the event of unemployment
or of vocational disability.
The entrepreneur is willing to do his part for the advance-
ment of the specially gifted, to encourage the acquisition of
personal property by an ever increasing number of people,
and to lend active support to the building of livable
homes . . . .
The Works Councils Law of 1952 has created the legal
basis for a healthy cooperation between management and
co-workers which is already obtaining in a large way. This
law has great possibilities, provided both sides apply it in
the spirit in which it was conceived. The German entre-
preneur is imbued with the will to help the Works Councils
Law to become a constructive reality. From the cooperation
in a spirit of solidarity of all concerned there should result
industrial peace. The hand for cooperation is stretched out
far.
Social self-government offers employers' organizations and
trade unions the fruitful opportunity to cooperate in solving
tasks objectively and in promoting social peace.
The many visits of German businessmen to the United
States under our Exchanges Program have given proof
of their keen interest in human relations as understood
in our country. Many talks with German industrialists
indicated how much they were stimulated by the em-
phasis in America upon the sociological and psycholog-
ical side of the employer-employee relationship.
The idea of having sociologists work among company
employees anonymously, so that the management may
262
 WHITHER GERMAN INDUSTRY?

be informed how the workers feel and react, is still novel

enough in Germany to be considered newsworthy. Thus
Die Welt, one of the most widely read dailies in north-
western Germany, on April 22, 1953, devoted three col-
umns to an interview with a sociologist operating under
the pseudonym Frau Erika, in which she described how
she arrives at her conclusions.

A considerable number of entrepreneurs are presently

engaged in an effort to awaken an understanding of
shareholding among their employees as a preliminary to
offering them company shares instead of other bonuses.
It may surprise American readers to hear that such a
"sales talk" is necessary. The fact is that the "little
people" in Germany do not know much about the stock
market and are even rather afraid of shares with their
inevitable fluctuations. They prefer to deposit their sav-
ings in the savings banks or to buy life insurance, and
to receive special cash bonuses from the management.
These entrepreneurs would like to have the worker
feel that he is sharing in the profits which the work of
his hands has wrought. The workers are gradually seeing
the light. The trade unions, interestingly enough, did
nothing to help this education of the workers in "capital-
ism" along. They seemed to fear losing some of their
socialistic stock-in-trade if their members became co-
owners of the company for which they are working. In
the same vein large concerns have established special
savings accounts for the purchase of homes by the
workers, and are helping the aspirant to such a home
by a regular contribution from the company.
One of the managers of Cute Hoffnungshiitte made
the observation : "I welcome the eagerness with which
our workers are acquiring motorcycles. The 'Bridemo-
263
 TYCOONS AND TYRANT

bile~ [Brautmobil] 1
is the best strike breaker imagin-
able."

The Moral Rearmament Movement, also known as the

Oxford or Caux Movement, has an impressive following
in the German entrepreneur class. At Hrst I believed it
to be a specialty of the Ruhr tycoons. As a matter of fact
it counts workers, too, among its adherents, as the fol-
lowing incident illustrates:
In October 1952, some 222 members of German Works
Councils signed an "Appeal to Everybody," with the
theme song, "we must [as a people] find a basis for unity
which can be accepted by all." The Ap]peal stated:
On the basis of our experiences in our plants we are
convinced that the moral rearmament of our people can
supply the basis for such unity.. .. A wave of absolute
honesty, cleanliness, unselfishness, and love will give a new
meaning to our democracy and instill new hope in our
nation.
The Working Association of Independent Entrepre-
neurs printed this appeal in its official organ, the Aus-
sprache, and the president, Ernst Schleifenbaum, fol-
lowed it with an immediate reply:
In reprinting the (CAppeal to Everybody" in a prominent
place in our Amsprache we wish to tell these courageous
men of the Works Councils from important plants that the
German entrepreneurs second their appeal. . . . We en-
dorse the principle that moral yardsticks must constitute ·
the basis for human behavior in industrial life.
Other appraisals accumulated.
1. This nickname for motorcycle stems from the fact that the sweet-
heart or bride of the owner usually occupies the extra seat on this
vehicle.
264
 WHITHER GERMAN INDUSTRY?

Religious discussions or addresses by social-minded

clergymen now often figure in the convention programs
of employers' federations. As far as I could ascertain,
this practice started in the coal industry, where espe-
cially two men, Heinrich Kost, director-general of the
German Coal Mining Management (Deutsche Kohlen-
bergbauleitung), and his associate, Martin Sogemeier,
former federal coal commissioner, have distinguished
themselves for their progressive social outlook.
The mine owners at first rubbed their eyes in wonder-
ment when they noted a Protestant and a Catholic pastor
listed among the convention speakers. It was an un-
heard-of thing. But they were deeply impressed with
the earnest pleas of these men of the cloth that Christian
ethics can and must play a role in the administration of
modern industry. The coal industry by now is seeking
the constant advice and assistance of ministers of the
gospel for the solution of its problems.
From the coal industry the idea of invoking the aid
of the church as a neutral agency has spread to other
branches of German life. The Evangelical Academy at
Loccum, near Hanover, provides regular opportunities
for educators, youth leaders, workers, farmers, journal-
ists, refugees, lawyers, civil servants, doctors of medi-
cine, artists, athletes, and men of industry to meet under
Christian auspices for frank discussion of their problems.
Since its resumption of activities immediately after the
close of the war, this Evangelical Academy has spon-
sored 166 meetings for the various groups mentioned,
with a total of 10,596 men and women in attendance.
Of these, no less than 1,361 participated in the discus-
sions on industry. 2 Lutheran Bishop Hanns Lilje of Han-
over is a frequent speaker.
2. Rheinischer Merkur, February 20, 1953.
265
 TYCOONS AND TYRANT

I was able to attend the 200th meeting of the Acad-

emy. Its purpose was to impress the invited young entre-
preneurs with their share of responsibility for Germany"s
future. The moderator, Pastor Johannes Dohring, took
pains to make it quite clear that his generation of
younger and middle-aged men must be prepared to work
for the common good without personal glory, possibly
even without visible results. For, he said, the debris left
by Nazism is so huge and the task of removing it so
in1mense that the new house that is to be Germany may
possibly be finished only by the next generation.
"But," he cried out, c'this is no reason for us to be
pessimistic. On the contrary, we shoulld thank God for
the great challenge that has been thro~Nn out to us.''
Besides Loccum, there are now eleven other Evangel-
ical Academies, in which altogether about 100,000 par-
ticipants discuss the issues of the day.. At Bad Boll, in
the Swabian Alps, seat of one of thes:e academies, the
junior members of the Working Association of Inde-
pendent Entrepreneurs held a meeting early in 1953.
Their report to the board of directors emphasized that
the choice of the Academy was a happy one because it
was a neutral sponsor.

Parallel with these Protestant conferences there have

been similar ones under Catholic auspices. The Kom-
mende meetings between mining directors and miners
deserve special mention. Kommende in the days of the
Catholic Knights of the Order was an estate adminis-
tered by the commander (Latin comrnendatore) of the
order. Such an estate, now property of the Catholic
Church, has persisted until today in Brackel, a suburb
of Hanover. The buildings on the premises have been
converted into discussion rooms, dining halls, lounges,
266
 WHITHER GERMAN INDUSTRY?

and guest bedrooms for a Catholic counterpart to the

Evangelical Academies.
The moderator for the exchange of vie\\rs between
mining management and workers is a Dominican priest,
Father Marcus Corman, who is as much at home in the
mine pits as he is in his chosen field of sociology. A bril-
liant analyst and speaker, he has a gift for harmonizing
conflicting viewpoints. His approach is a Christian but
nonsectarian one, as is also that of the Evangelical Acad-
emies. During my attendance at a Kommende meeting
the problem of establishing a more human and personal
relationship between labor and management in the min-
ing industry was treated by both sides with impressive
earnestness and an honest appreciation of its importance.
There was no mincing of words, but there vvas also no
name calling and impugning of motives.
What the post-war German coal industry has perhaps
most at heart is the youth villages founded and main-
tained by the coal operators, which house the thousands
of young men and boys from Eastern Germany who fled
westward, many of them orphans, others uncertain
whether they will ever see their parents again, still others
with parents living in barracks in Western Germany,
unable to find jobs for themselves.
It was Mrs. Lochner's and my privilege to visit one of
these villages in the company of Dr. and :tvlrs. Martin
Sogemeier. We drove to the Ruhr Jugenddorf at Castrop-
Rauxel. There over three hundred boys between the
ages of fourteen and twenty-one lived under conditions
such as teenagers in any country might envy them for.
The "villagers'' were miners' apprentices, boys aged
fourteen to sixteen years, and young miners, lads between
seventeen and twenty-one. The apprentices came from
refugee families. The young miners had learned their job
in Eastern Germany under Russian occupation and had
267
 TYCOONS AND TYRANT

fled westward with their parents when communism be-

came unbearable. The villagers must make room for
their successors before having attained the maximum
permissible age of twenty-five.
The village with all furnishings was built by the coal
mining company which employs the young miners and
the apprentices. Airy, comfortable, two-storey houses are
constructed in such a manner that there are always three
boys living in one apartment. Each apartment has a bed-
room, a living room, and a bathroom with three wash-
stands and hot and cold water.
It was especially interesting to note how each young
lad adorned the shelves above his bed. Some had in-
expensive trophies from trips undertaken by the whole
village to German places of interest or even to nearby
Holland and Belgium. One boy still displayed all the
congratulatory messages received on his Confirmation
day. Others had the photographs of their parents. Still
others books, objets d'art, plants, etc. There was nothing
stereotyped about it. Each villager was encouraged to
express himself individually.
In each house a young couple acted as foster parents.
They were under instructions to refrain from anything
that looked like regimentation. They were assigned there
by the Christian Welfare Federation charged by the
mining company with the management. The arrange-
ment is on a five-year basis, renewable, with the Feder-
ation working on a daily budget of five marks (about
$1.25) per head. The apprentices are charged one half
of this sum, the mine owners contribute the other haH.
Young miners pay 3.70 marks to begin with, with the
owners making up the difference of 1.30 marks. As the
wages of the young miners increase, they pay corre-
spondingly more, but never more than five marks.
Light, heat and water are furnished by the mine
268
 WHITHER GERMAN INDUSTRY?

owners. The Christian Welfare Federation must provide

the upkeep, personnel, and food.
New projects are launched jointly by the mine owners
and the church management. The villagers themselves
take a hand in improvements, such as a swimming pool.
When we were visiting, the boys had just returned from
their day,s work, had stripped to the waist and were busy
with spades and shovels, making the dirt fly. Each house
had been assigned its space which it was pledged to dig.
There was singing and joking and laughter.
The boys had a form of self-government that included
full meetings of the entire village, sessions of a council
made up of one speaker, or delegate, from the six boys
living on each of the two floors in each two-storey house,
and a boys, court which condemned offenders to fines
or even arrest. The administrator merely reserved a veto
right to himself on the actions of the various self-govern-
ing bodies.
The Federation offers banking facilities to the young-
sters for saving what remains after taking out a little
pocket money and paying for their keep. When a boy
wishes to acquire a radio set or a bicycle or a camera,
he may touch his savings, provided the "foster parenf,
of his house and the administrator approve. Basement
space is provided in each house for keeping the bicycles
each in a steady, dry place.
The youngsters are admonished to go to church on
Sundays but nobody compels them to do so. There are
discussion evenings in the big lounge of one of the build-
ings to which nobody is forced to go, yet where eager
crowds of boys engage in argument on topics of the day
and on religious questions.
"We teach the boys that it is perfectly proper for
everyone to have his own opinion, but that he must be
tolerant of the views of others," the administrator said.
269
 TYCOONS AND TYRANT

These boys would probably still be running around in

rags had they not been taken in hand in these youth
villages. The harm done to their souls by the Nazi teach-
ings is rapidly disappearing if not already completely
gone.
In general Heinrich Kost in his influential position is
concerned about the fate of the millions of refugees from
the east. He has developed what has become known
throughout the Ruhr region as the Kos1t Plan. His Chris-
tian conscience, as he himself put it, moved him after
a tour of the refugee camps in the Ruhr area to devise
a scheme for making it possible for its inhabitants and
their families in the Ruhr to have both home and jobs.
There are 30,000 able bodied persons to be provided for,
to which must be added their families .
Kost feels that this is a problem for industry to solve.
His plan is to allocate the 30,000 evacuees among the
communities of the area and among the various profes-
sions and callings. Kost has figured out that, to realize
his project, one additional job must be created for each
500 jobs now existing. That would mean, he points out,
that a factory employing 1500 persons would have to
agree additionally to engage three evacuees and find
living quarters for them. The building of homes is to be
financed partly by government grants, partly by bank
loans, and partly by loans from the respective factories
themselves. The evacuees are to be given reasonable
terms for gradually amortizing the loan:s and thus paying
for their homes.
The Government has already endorsed the plan. When
I left Germany Kost was at work to mobilize industrial-
ists in the Ruhr for his idea, confident of success.

These, then, are some of the indications that a pro-

gressive outlook animates many present-day entrepre-
270

__
,
 WHITHER GERMAN INDUSTRY '?

neurs in what might be called the microcosms of indus-

try. As to the macrocosm of state life, there is still to be
found a reserve and even reluctance about active par-
ticipation in politics. I tried to learn the reason by direct
questioning of dozens of tycoons. The ans,wers were
1·evealing.
One group acted like the child that has p]layed with
fire and got burnt: "Dabble in politics? \Vhy, that's
what got many of us into trouble the last tin1e we did.
If we joined the Nazi Party, even with ideaHstic inten-
tions, we were arrested by the Allies. Who can tell what
will happen next in this troublesome world? The Rus-
sians rnay overrun us. Then woe to any of us who be-
longed to an anti-communist party. No, we''ll keep as
far away from politics as we can."
Another group pleaded that their businesses were so
disrupted by war that for the present they must devote
all their energies to meeting the fierce competition of
the post-war period. ccDas W erk verschlingt den Men-
schen'' ("The plant or factory devours the rnan") is a
phrase frequently heard expressed by men vvho hardly
have leisure even for their families. Others in this cat-
egory asserted that the managerial class today must at-
tend to so many details due to fundamental changes in
Germany's structure and the passage of so :many new
laws affecting business that there is no time for them at
present to interest themselves actively in government.
"Later, when more normal conditions prevail again, we'll
take a hand."
A third group stated that a man like Hugo Stinnes Sr.
could afford to belong to the old Reichstag because his
constant presence was not demanded and he could still
keep his controlling hand on the multifarious activities
of his industrial empire. The new Bundestag, however,
must clear away the Nazi rubbish, lay the foundations
271
 TYCOONS AND TYRANT

for a new democratic Federal Republic, and build from

the very bottom. All this requires exacting concentrated
effort. Membership in parliament is now a full-time job,
with much overtime for night committee sessions, and
leaves no leisure for private business.
A fourth group stressed the far-reaching powers given
the labor director and the representatives of the trade
unions under the terms of the co-determination law, and
argued that the entrepreneur must be constantly on the
alert to safeguard his rightful interests. Their opposite
numbers, they said, were men excellently trained in spe-
cial trade union schools with a long tradition of teaching
the art of labor politics.
The reasoning of each of these groups is understand-
able. Businessmen are men of action. They want to get
things done without waste of words. Parliamentary pro-
cedure entails endless talk. Committee work is a bore
compared to the exhilaration an entrepreneur derives
from tearing around in his plant, watching his product
take shape. Politics to men of this type carries too much
overhead in terms of work and time.

Both the government and thoughtful, far-sighted in-

dustrial leaders are keenly alive to the dangers of polit-
ical apathy symbolized by these four groups and are
trying to stimulate active interest in good government
among their peers.
Minister of Economics Ludwig Erhard, the indefati-
gable protagonist of private enterprise in the new Ger-
many, loses no opportunity to admonish the entrepre-
neurs to keep their watchful eye on the political situ-
ation. On the occasion of the seventieth birthday anni-
versary of Theo Goldschmidt, president of the Essen
Chamber of Industry and Commerce and one of the
272
 WHITHER GERMAN INDUSTRY?

leading chemical scientists in the Ruhr Valley, I heard

Professor Erhard admonish the assembled industrialists
earnestly in these words:
Your task is not fulfilled when you produce goods and
sell them; your task is also to keep the banner of liberty
Hying, to further general acceptance of the belief that . . .
there is nothing more precious than personality. . ..
There is no doubt but that the free world today is engaged
in a struggle against collectivism. . . . It is here that the
entrepreneur has a real and essential mission, not of self-
preservation, but of a much higher nature. The entrepreneur
has been ordained to help defend our social order and, be-
yond that, the civilization and culture of the Occident. If
the entrepreneur fails, if he does not rise to the occasion,
if he is unable to master the tasks of today and tomorrow,
the spirit of collectivism will enter our society by the breach
thus made by him. . .
Without a free entrepreneur there can be no free con-
sumer, there can be no free people. . . .
August Dresbach, member of the Bundestag, in an
article which appeared in the Frankfurter Allgemeine
Zeitung for July 7, 1952, and was later widely distrib-
uted as a leaflet, taunted certain industrialists in these
words for their condescension to serve as experts in a
proposed Economic Council while declining to become
candidates for elective office:
Nowadays men don~t want to enter parliament; they don~t
want to walk through the inferno of an election campaign.
They~d now like to be invited by the federal president, on
nomination of their professional organization or their guild,
to sit in a Federal Economic Council, in order there to be
able to lead an almost celestial life of wisdom as a politically
neutralized expert in economic and social matters, in other
words, in just about everything having to do with federal
legislation. . . .
273
 TYCOONS AND TYRANT

Anybody who desires to place his expert knowledge at

the disposal of the legislative branch of government should
kindly present himself to the committees of the two cham-
bers at Bonn. The instrument of hearings is still capable
of much development. But it may be asserted without exag-
geration that [certain] swellheads ... consider themselves
too hoity-toity to step before a committee of parliament as
experts. Perhaps, too, some realize they are too empty-
headed, wherefore they prefer to send second- or third-rate
deputies who, however, know their stuff.
Josef Winschuh in season and out of season stresses
the necessity of active participation by management
( U nternehmertum) in the affairs of state. Thus he wrote
on October 24, 1952, in a syndicated article:
The history of our times has brought the painful proof
and teaches us daily that it is not the Wirtschaft [i.e., busi-
ness and industry] that determines our fate, but politics.
. . . The entrepreneur can no longer remain aloof from
politics and rely upon the biological and social advance-
ment of the bourgeoisie . ... No one, no Bismarck, no
Kaiser, no authoritarian leader will any longer do his politics
for him. If he does not develop organs of his own for polit-
ical expression his profession will becomte stunted.
There are many hopeful signs that men like Erhard,
Dresbach and Winschuh are not preaching to deaf ears.
The 1953 convention of the Working .Association of In-
dependent Entrepreneurs ( Arbeitsgemeinschaft selb-
stiindiger Unternehmer) was called, significantly, Staats-
politische Tagung, meaning that its purpose was "guid-
ing the entrepreneurs into active politics." s The 200
delegates whose deliberations I was :invited to attend
were predominantly men and women jin the age groups
between thirty and fifty.
3. Blatter der Freiheit (Bad Nauheim; Vita Verlag), April 1953,
p. 163.
274
 WHITHER GERMAN INDUSTRY?

The keynote address by Vital Daelen, inlaid tilings

manufacturer, was a fervent plea to industry to help
actively in building a democratic Germany. He empha-
sized that the German of today is living in a young state
which has as yet evolved no definite economic order,
wherefore it is the duty of the entrepreneur to take an
active hand in its creation. But while urging his col-
leagues to assert their rights as representatives of indus-
try in the political arena, he took sharp issue with the
contention of Walter Freitag, president of the German
Federation of Labor, uWe are the state,"' and of Christian
Fette, Freitag's predecessor, "We are entitled to the lead-
ership of the state." No single individual or group in a
democratic state, he insisted, possesses an exclusive
claim to leadership.
As an alternative solution to the personal participation
in active politics by an entrepreneur who for valid rea-
sons is unable to leave his plant, he suggested that at
least a member of the board of directors might be dele-
gated to stand as a candidate in an election contest.
The monthly organ of the Working Association of
Independent Entrepreneurs is entitled, Die Aussprache."
Preponderant space is given to topics such as the impact
of the American conception of Human Relations upon
German industry, the improvement of employer-em-
ployee co-operation, the betterment of housing facilities
for workers, and the role of industrial management
schools in the United States.

Concrete evidence of a growing spirit of devotion to

public service beyond the necessities of one's own in-
dustrial undertaking came to me in many ways during
my travels up and down Germany.
4. The literal translation is "the talking-out," or more anglicized,
"the thrashing-out," meaning that it is an organ of free discussion.
275
 TYCOONS AND TYRANT

In Hamburg, Erik Blumenfeld, an energetic, middle-

aged man active in coal export and i1mport as well as
shipping, has become chairman of the :Hamburg section
of the Christian Democratic Union ( Adenauer's party) .
Having been in a concentration camp twice during the
Nazi regime, he feels that the busy mtan of affairs has
the duty to prevent a recrudescence of radicalism in
whatever form. He believes political activity will pay
best dividends in that respect.
"Industrialists should take a more active hand in the
political life of the nation," he told rne on several oc-
casions. "Too many fear their business may be hurt if
they are known to belong to a political party. That is a
wrong. In these serious times everybody should stand up
and be counted."
In Duisburg I came to know Hans-H.elmut Kuhnke of
the large Klockner steel concern, a fon:vard-looking man
of forty-five who finds the time to engage in various
forms of public service and follows national and inter-
national events with keen, broad-minded interest. In his
home town he is serving on the city council as a member
of the finance and budget committee.
On the international level he sees d learly the danger
to Germany of relying too long and too heavily on for-
eign aid, be it only because some of hi:s compatriots are
beginning to feel smug about their country's phenomenal
comeback, ascribing it solely to German efficiency. He
also fears that wooing Germany too much for the Euro-
pean Defense Community rnay increase the following of
the small group of incurable Nazis vvho believe that
Europe's apparent inability to get along without a Ger-
man army proves that Hitler was right after all.
Like thousands of other enlightened Germans he con-
demns the present proportional representation <'list" sys-
tem and the resulting domination of the party machines.
276
 WHITHER GERMAN INDUSTRY?

As Kuhnke is a personality who does not hesitate to

defend his views in public, he has become a recognized
leader in the Ruhr.
In an article published in the Essener Allgemeine
Zeitung on July 31, 1952, Kuhnke discussed three prob-
lems which the coal and steel industries of the Ruhr must
face with boards of directors made up largely of new
men.
The first problem, he said, is presented by the fact that
steel production in the United States and in the Soviet-
ized countries behind the Iron Curtain has reached stag-
gering figures. As a result:
The Ruhr is no longer the big brother with his small
sisters and brothers clinging to his hands; the Ruhr today
is walking as a step-child between a young, strong couple,
which unfortunately at the moment is engaged in a big quar-
rel if, indeed, it has not already been divorced.
The second problem, Kuhnke developed, is that of
finding a proper substitute for collectivism :
In the big plants the issue is no longer, in fact, collectivism
versus individualism, but solely the alternative of collectiv-
ism or community spirit.. .. Collectivism ends in dictator-
ship, community spirit in democracy.
The third problem, as Kuhnke sees it, is in the
humanizing of our organizational fonns. In my opinion all
efforts at satisfactory human relations are doomed to failure
unless at the same time there is a wise numerical restriction
as to the number and a humanizing as to the purpose of the
organizations representing our industries on a professional
or regional basis.
Hans-Helmut Kuhnke, as we have seen, has touched
upon the greatly diminished importance of the Ruhr in
the world's economy. There is other eviden•ce that the
277
 TYCOONS AND TYRANT

almost hysterical fear of a recrudescence of Nazism via

the Ruhr is unfounded.
There is, for instance, the obvious lack of enthusiasm
of the Ruhr steel concerns over the prospect of receiving
defense contracts once Germany has been admitted to
the European Defense Community. This does not mean
that these concerns are anti-American or anti-west. They
are distinctly pro-western, if on no other grounds, then
for reasons of self-preservation, in that they know that
an alliance with the East, in which present-day Germany
would be only a junior partner, must inevitably result in
their dispossession.
The basic reason for an only grudging acceptance of
the possibility that the Ruhr, by the force of compelling
circumstances, may have to develop, for a time at least,
into an arsenal for the preservation of the free world lies
in the conviction of German industry generally that war
and preparations for war do not pay. This feeling is espe-
cially strong in the younger generation.
Visiting the locomotive works of the Krupp Concern
I ran into a young engineer, Franz Kluge, who proudly
showed me engines under construction for Indonesia,
South Africa, Algeria, and Brazil. As I gradually drew
the story of his life out of him, I found that he had orig-
inally been an attorney in Eastern Germany. Since his
family had helped save the lives of scores of Jews, the
Nazis frequently raided the ancestral home and made
many arrests. Then came the Russians, and some thirty
members of his immediate relationship were killed.
Franz Kluge escaped to the west, found employment at
first as a mechanic, and now was sectional manager in
the Krupp locomotive works.
"Supposing Krupp were to engage in gun making
again?" I asked.
278

~·
 WHITHER GERMAN INDUSTRY?

Without a moment's hesitation Dr. Kluge replied,

~~Dann hau~ ich ab" ("That's when I'll vamoose''). ''That's
how many of my colleagues feel also," he added.
That evening I had dinner with several Krupp direc-
tors. As we became better acquainted, I posed the ques-
tion, "And when will you resume making cannons?'~
''Womit?~~ ("With what?") riposted one of my hosts
banteringly, alluding to the fact that Alfried Krupp von
Bohlen has agreed henceforth to keep away from making
steel. Then, in a serious vein, he said:
"Do you think any of us want to go to Landsberg?"
Here he referred to the fate of twelve high Krupp offi-
cials, including Alfried, who were incarcerated in Lands-
berg prison for many months while awaiting trial and
later, with but one exception, did time there as a result
of the Niirnberg verdicts. He continued:
We all realize that defense contracts are poor business.
They bring a fillip to industry for only a limited time. The
cost of converting the plants to war production, especially
armaments, and then reconverting them again to peace-time
purposes-provided they have survived air action-is enor-
mous. We don't want to make any more guns or tanks if
we can help it. In that we are at one with all our workers.
Another director narrated how a British general,
charged with supervising the dismantling of forty per
cent of the total Krupp Concern (thirty per cent had
been destroyed by air action), said, somewhat ruefully:
You know, I believe it was a mistake for us British to
have insisted upon the dismantling of your war installations.
We should, on the contrary, have dismantled all plants for
the manufacture of peace-time goods and insisted that you
continue to produce guns and tanks and other defense equip-
ment for us.
Now many of our British plants which would like to go
over to peace-time production completely are compelled to
279
 TYCOONS AND TYRANT

continue to handle defense contracts, and meanwhile you

Germans are capturing the markets of the world.
Besides, as you rebuild, you naturally install the latest
equipment and you erect your factories according to most
modern principles.
Two weeks later one of the participants in this dinner,
Director Fritz Wilhelm Hardach, made the following
statement in the course of the discussion which followed
a lecture of his in Bonn on "The Struggle for Coal and
Steel":
Personally I deem it necessary for Germany to make a
defense contribution to the European Defense Community.
But I beg you to have understanding for the fact that we
at Krupp's have no yearning for the resumption of arma-
ment-making, but prefer to make locomotives, machinery,
trucks, dredging machines, and, if you please, milk cans in-
stead of cannons. The Krupp works suffered the most bomb
attacks and after the war we had dismantlings, the Niimberg
trials, etc. The owners, the directors and the workers of our
firm are agreed on the attitude we must take.
Much has been made by some writers of the unwill-
ingness of industrial leaders to "socialize'' their under-
takings, i.e., to abolish private ownership. The British
occupation forces during the Labor Government were
especially keen to socialize as much of industry in their
zone as possible, and labor press comment was rather
caustic about the owners who fought these attempts.
It stands to reason that few people in this world are
ready to give out of their hands something that they
themselves have built and which they believe they can
administer best. In other words, anyone who believes in
private property will fight for its retention.
But there is an argument of a still more convincing,
because unselfish, nature which a number of industrial-
280
 WHITHER GERMAN INDUSTRY?

ists whom I have learned to know as far-sighted and

broad-minded have advanced in talks with me. It is the
following: the greater the concentration of power in the
hands of a government, the easier does it become for a
dictator, once he has seized power, to intrench himself
so rapidly that his reign is soon absolute.
True, private enterprise as well as the trade unions
failed to prevent Hitler from making himself master of
life and death. But, these industrialists say, he was a one-
time phenomenon. His methods, his techniques, his ap-
proach were new. He risked the Big Lie and got away
with it because nobody then believed anybody would
dare to prevaricate so atrociously. Now, however, em-
ployer and employee have learned their lesson the hard
way, and so long as private enterprise lasts, they make
bold to predict that no dictator will be able to dominate
Germany again. Why is it, they ask, that the collectivists
regard private enterprise as the greatest stumbling block
in their path? And they follow through with an answer:
because collectivism, like Nazism, cannot succeed with-
out dictatorship, and the collectivists realize that indus-
try is the most formidable bulwark standing in the way
of its attainment.

Wherever I traveled in Germany I found that the

political conception which elicits the greatest enthusiasm
among the young entrepreneurs and in the young gen-
eration of Germans generally is that of European Feder-
ation. With men who are now founding families or are
the fathers of young children the fear is ever present
that their offspring may some day have to engage in
soldiering under conditions which become ever more
gruesome, the further advanced the science of mass de-
struction develops. These men, who have mostly gone
through the inferno of war, are groping around for some-
281
 TYCOONS AND TYRANT

thing practical that may obviate the danger of armed

conflict.
A European Federation along the lines which appears
now to be developing at Strassburg is the one ideal that
seems to the younger German generation to be both
practicable of attainment and ethically worth striving
for.
A new generation is at the helm of German industry.
These men in their formative years have gone through
experiences which, ugly and horrible though they were,
could not fail to give them drastic object lessons. Their
experiences were an education-an education that should
render them immune to political double-talk, dema-
goguery, and intolerance. Their experiences constitute
an asset which is altogether too easily forgotten or over-
looked as past occurrences are pondered and the failures
and mistakes of the previous generation remembered.
The young men of German industry are earnestly try-
ing to catch up with the modern world as we understand
it. They are looking forward to European federation, not
backward to the eras of ''imperialism" and Nazism. It
would be a grave mistake to apply to them the inane
slogans of "history repeats itselfn and "they'll do it
again." Much of the peace of the world depends on an
understanding of the forces at work in Germany that
presage a better future.
As far as I have been able to observe, there is no hope
which the rising generation of German industrialists
nurses more fervently than that of the unification of
Europe in some great, redeeming concept. The passion-
ate hope for a new, United Europe which animates
young Germans in all walks of life provides a positive
answer to the destructive fear that a German comeback
may prove but a prelude to another war.
282
CHAPTER FOURTEEN

America and the Federal

Republic of Germany

h e facts presented in this survey show that, by and

large, the story of the German industrialists in their re-
lation to Hitler is a story of sins of omission rather than
commission. Evil was mingled inextricably with the
good, but the evil wrought by German tycoons was the
result of human shortcomings, not of criminal intent.
We may in a holier-than-thou attitude pronounce a
verdict of moral guilt against those Germans in industry
who helped Hitler, or who lacked the stamina to stand
up to him when opposition was still possible, in the smug
assumption that, given the same conditions in our coun-
try, we would have had the zeal of martyrs and resisted
unto death. We cannot, however, in view of the facts
presented continue to repeat the charge that German
tycoons were bearing a distinct and deliberate respon-
sibility for placing Hitler in the saddle; that German
industry saw in Hitler a new Iron Chancellor who would
smash the trade unions; that the German lords of iron
and steel lusted for war and conspired with Hitler to
provoke it; and that Germany,s industrial magnates
failed to resist Nazi iniquity.
The fact cannot be stressed too often that the Hitler
283
 TYCOONS AND TYRANT

of 1932-33 in word and deed was not the Hitler of 1934

after the Rohm purge, much less the Hitler of the years
immediately following the death of Hindenburg, let
alone the rest of his infamous rule. Hitler revealed him-
self only step by step, as we have seen. Seldom in history
has a demagogue duped more people and debased good
intentions more perfidiously than he.
What should our attitude as Americans be toward the
country which we have encountered twice in a lifetime
in deadly combat yet which has twice survived? How
should we regard German industry and its leaders?
Before an answer can be supplied to these questions,
it is essential to understand wherein the principal im-
pedimenta to a wholehearted accord between the United
States and Western Germany lie. They may be grouped
under the following headings:
Discrimination in the application of standards for
German behavior compared with other sister nations;
The legend that Germany virtually knew nothing
about democracy until the fall of the Kaiserreich in 1918;
Emphasis on German shortcomings of the past rather
than upon her hope-inspiring outlook for the future;
Lack of knowledge of German fears and doubts.
Yardsticks applied to Germany by self-appointed
World War III Preventers and their ilk are different
from those whereby other nations are measured, so that
communism as a menace to the free world pales into
insignificance before the alleged German danger. What
in other countries is lauded as patriotic becomes a dan-
gerous manifestation of nationalism when it occurs in
Germany. Anti-communists are dubbed fascists . Parties
of the right which in other countries are labeled "con-
servative" are stigmatized as "nationalistic" when "Made
in Germany.'' It is praiseworthy only for the Duponts,
Remington Arms, Schneider-Creusots, Vickers and Arm-
284
 AMERICA AND THE REPUBLIC OF GERMANY

strongs, and Imperial Chemical Industries to manufac-

ture weapons, chemicals and explosives. The ccDevil's
Chemists" are at work when German savants take to
chemical science.
How was this double standard made possible? If we
take the trouble to go back in history somewhat, to the
period of the First World War, we shall discover that
Lord NorthcliHe, master propagandist of his day, in 1915
set a pattern which has been thoughtlessly followed by
many writers ever since. The pattern is this: there is
something in the German character which makes it im-
possible for the German nation ever to become a de-
pendable democratic state; Germany has so consistently
gone the path of absolutism and military aggression that
she can never, or certainly not for generations to come,
be trusted truly and sincerely and from conviction to
embrace democracy as its political faith. Above all, the
Germans have not known democracy before 1918.
What are the facts of history?
The German Reich of 1871 was a constitutional mon-
archy, much like that, for instance, of Belgium, Italy and
Austria-Hungary. It was certainly incomparably more
democratic than the Russian czarist regime with which
the West allied itself during the First World War.
The Baron von Stein reform of 1808 had given the
German cities extensive self-government which re-
mained intact until 1933. The federal states which com-
posed the Reich, in so far as they were kingdoms, had
been constitutional monarchies since the democratic up-
surgence of 1848 which gave our nation a Carl Schurz.
The Hanseatic cities of Hamburg, Bremen and Liibeck
had had democratic constitutions for centuries. They
ranked as city states in the upper house of the Reich,
the Bundesrat, alongside the nineteen other states which
were governed by kings, princes, granddukes, and lower
285
 TYCOONS AND TYRANT

hereditary rulers. All the rulers, from the king of Prussia

(who at the same time was German emperor) down to
the reigning prince of tiny Lippe, had been subject to
the control of their respective legislatures.
We have had strong-willed presidents and weak chief
executives. Similarly in Germany an overpowering per-
sonality like Prince Otto von Bismarck, the Iron Chan-
cellor, was a more persuasive spokesman for his sover-
eign in his dealings with the Reichstag than was a Theo-
bald von Bethmann-Hollweg or a Count Georg von
Hertling. But even Bismarck could govern only within
the limits of the constitution. For twenty years he en-
gaged in heavy encounters with the parliament which
he had called to life. These forensic battles were on a
high intellectual plane and were followed with extraor-
dinary interest by the German nation. Even today the
names of Ludwig Windthorst, August Bebel, RudoH
Virchow, Friedrich Daniel Bassermann, and Wilhelm
Liebknecht are remembered because they locked horns
so ably with Otto von Bismarck.
In southern Germany democracy had much the same
traits as in Denmark, Norway, Sweden, or Holland.
Prussia, on the other hand, was known as the Ordnungs-
staat, the state par excellence of law and order, whose
bureaucracy was proverbially competent and incorrupt-
ible and whose citizens were trained to be paragons of
discipline. Notwithstanding, Prussia was also the cradle
of a strong Social Democratic Party with outstanding
deputies in both the Reichstag and the Prussian Diet.
Thus a strong democratic current ran through German
history parallel to similar currents in the rest of Europe
after the French Revolution. The German upheaval of
1848 coincided with similar uprisings in Belgium, France
and Austria. The trend toward unification in Germany
found its counterpart during the same decade in Italy.
286
 AMERICA AND THE REPUBLIC OF GERMANY

It is therefore wrong to claim that the German people

had their first taste of democracy only after their mon-
archy collapsed with the Austro-Hungarian in 1918. In
fact, the Germans before 1918 were well versed in par-
liamentary institutions and procedures, even though in
their practical application· they often differed from
American or British conceptions. That is true, however,
also of many countries which we unhesitatingly hail as
democracies although in fact they are autocracies.
Even Hitler dared not attack the democrattic principle
as such, so deeply ingrained was it in the c;erman con-
sciousness. He merely inveighed against the corruption
and inefficiency which he pictured as inherent in the
Weimar Republic. He was at pains to convince his lis-
teners that his regime represented true ~ :democracy."
4

We must disabuse ourselves of the theory of a heredi-

tary, ingrained and therefore ineradicable incapacity of
the Germans for self-government. The HitleJr period can-
not fairly be regarded as a logical historical development
based on certain bad and incurable traits in the German,
but rather as an unfortunate interlude, brought about
through economic stress and the threatening danger of
communism, during which democracy, so to speak, had
to go underground, only to rise again surprisingly when
the tyrannical regime fell to pieces.
In shaping our relationship to Germany, common
sense commends that we concentrate upon the living
forces in the Federal Republic with which ,we can work
toward a better and more peaceful world. German de-
mocracy had a solid past. It is for us to recognize this
fact unreservedly. Such recognition will give the Federal
Republic great moral support. The overwhelming ma-
jority of the German people crave friendship with the
United States. The reception accorded Konrad Adenauer
during his visit in 1953 as the first German chancellor
287
 TYCOONS AND TYRANT

ever to be our official guest has shown that this desire

for friendship is reciprocated by the American people.
Let us cement that friendship by following a consistent
policy of encouraging constructive impulses in the new
Germany.
Friendship to be lasting must be based on mutual trust
and confidence. We must therefore abandon the attitude
of forever viewing Germany pessimistically, partly in
pity and partly in fear. Optimism coupled with courage,
determination and imagination, and not pessimism, is
needed to insure a relationship of permanent friendship
between our country and Germany. We have not given
the power of optimism a real try.
What about German youth and its hope for European
unity? Is that not something to be viewed with opti-
mism? German youth resents the glorification of war.
German youth eagerly seeks contact with the cultures
of other peoples. German youth is open-minded, ready
to embrace new ideas. The young people who have come
to our shores from Germany under our Exchanges Pro-
gram have, on the whole, given an excellent account of
themselves. Is that a negligible fact when we take stock
of German capacity for democracy? I know that our
failure properly to assess German youth is regretted by
the German tycoons no less than it is by all others who
hope for the stabilization of the Bundesrepublik.
Our attitude toward the new Germany, it seems to me,
77 7
is too much one of "ifS and "buts. We seem willing to
'

make concessions to Germany only if ever new proofs

of her "conversionH to democracy are given, if ever new,
visible demonstrations of a change of heart are furnished.
Then, after these conditions have been satisfied, we re-
77
mind the Germans by a series of "buts that they have
committed acts of aggression in the past, have perpe-
trated shocking deeds in days gone by, wherefore our
288
 AMERICA AND THE REPUBLIC OF GERMANY

approval of evidence of a new spirit can only be grudg-

ing and conditional. We seem forever bent upon send-
ing the Germans, as it were, back to the school benches
for more education in democracy.
We profess to be a Christian nation. Our Christian
faith should prompt us to be patient and understanding
as our recent enemy struggles to his feet after a knock-
out blow. The fact that not all traces of r~azism have
been eradicated in this short time does not mean that
we should now lose faith in the new Germany. It is un-
fair to expect a full return to democracy so soon after
the close of an absolutist era which had rig:id and com-
plete thought control as one of its outstanding charac-
teristics. Besides, it is in the nature of new·s that every
aberration from the path of democratic virtue is likely
to command a headline in the press whilst: the normal
life of the average citizen's devotion to the established
form of government goes unnoticed.
Rather than remaining forever on the scent of anti-
Semitism in Germany it would be more 4~onstructive,
obviously, to take note of the agreement which the Fed-
eral German Republic made with the Israeli Govern-
ment although it involves heavy financial obligations,
and of the continuing effort within Germany to restore
Jewish property to its rightful owners.
German official policy discourages all manifestations
of racial animosity. President Theodor Heus:s on Novem-
ber 30, 1952, dedicated a memorial at Belsen, where
many Jews were victimized. The whole German nation
applauded his moving address, in the course of which
he said:
We Germans will, shall and must, it seems to me, learn
to be brave when faced with the truth, and that particularly
on a soil drenched and devastated by the excesses of human
289
 TYCOONS AND TYRANT

cowardice. For naked violence which adorn:s itself with car-

bines, pistols and whips is always cowardly . . . when it
struts well-fed, menacing and pitiless amongst unprotected
poverty, illness and hunger.
Any German who speaks here must ... acknowledge the
utter cruelty of the crimes which were conamitted by Ger-
mans on this spot. He who would palliate OJr minimize them
or would even invoke the misguided use of so-called reasons
of state, would merely be insolent. . . .
In the past there have been many kinds of persecution
of the Jews. They were the outcome partly of religious fa-
naticism and partly of sentiments engendered by social and
economic competition. After 1933 there could be no ques-
tion of religious fanaticism. . . . And social and economic
arguments are not enough when there is more to be accom-
plished than predatory murder.. .. It is our disgrace that
these things happened within the geographical confines of
that national history whence Lessing and Kant, Gothe and
Schiller entered into the universal spirit. No one, no one at
all, can take this disgrace from us.
It is a significant fact that not a voice of dissent was
raised in Gennany against this address, which demanded
nothing short of Unconditional Atonement.
Rather than forever conjuring up unhappy memories
of the past, it seems to me to be more realistic to recog-
nize the fact that public opinion in Gennany stands
solidly behind the international policies of Chancellor
Adenauer. In the Bundestag election of 1B53 the radicals
of the right and left failed to capture a single seat, al-
though there was a record turnout ( 84.2 per cent) of
the voters. The Social Democratic opposition differed
only in method but not in aim from Adenauer's foreign-
political course.
The thousands of Gennans who flee penniless and job-
less from eastern, communism-dominated sections of the
Reich are living proof that freedom is as precious to
290
 AMERICA AND THE REPUBLIC OF GERMANY

the Teuton as it is to any other western national. The

fortitude of the people of Berlin has demonstrated that
the former German capital, once a stronghold of com-
munism and later of Nazism, is permanently cured of
any desire for a dictatorship of the right or the left.
True friendship further postulates complete honesty
concerning one's own faults and failings. It is necessary
to emphasize this self-evident point because in my dis-
cussions with men in German industry doubt was ever
present lest in view of past occurrences a truly harmo-
nious and trusting relationship may fail to develop be-
tween the new Germany and the west, especially the
country par excellence with which the Federal Republic
would like to live in friendship-the United States.
Among these past occurrences which were brought up
again and again by German tycoons who earnestly desire
firm, friendly ties with the west were the following:
The renewal of the Standstill Agreements on German
debts on May 29, 1933, although the German opposition
urged that by refusing to extend them the Hitler regime
would receive a vital blow;
The conclusion of a Concordat with the Holy See on
July 20, 1933, which proved to be a fine feather in the
Nazi dictator's cap;
The resignation and do-nothing attitude of Great Brit-
ain and France when Hitler in May 1935 introduced
conscription;
The signing of a naval agreement with the Nazi regime
by Great Britain in June 1935;
The acquiescence, except for verbal protests, by the
European powers in Hitler's sending 30,000 troops into
the demilitarized Rhineland; 1
1. The German historian, Walter Gorlitz, in his and Herbert A.
Quint's Adolf Hitler-eine Biographie, pp. 459-460, described the
situation in these words: "The year 1936 was the most critical period
291
 TYCOONS AND TYRANT

The conclusion of "Peace within our Time" by British

Prime Minister Neville Chamberlain with the approval
of French Premier Edouard Daladier at Munich on Sep-
tember 30, 1938, at the sacrifice of Czechoslovakia;
The American insistence upon Unconditional Surren-
der in 1945 with its corollary, the cessation of all German
sovereignty-a demand which threw hopelessness and
despair into the hearts of the rapidly growing number
of Germans who were joining the forcible overthrow of
Hitler and his regime; 2
Above all, however, these German tycoons remember
the calamitous effects of the Morgenthau Plan which de-
cisively retarded German economic recovery and left its
imprint upon some of Germany's industries even today.
The Morgenthau Plan, it will be recalled, was inspired
by Harry Dexter White for reasons which have now be-
come all too evident. It was given official approval by the
United States and British Governments on September
15, 1944, at Quebec, and aimed at ccconverting Germany
into a country principally agricultural and pastoral.''
Although some of its severest features were subsequently
dropped, the idea of a "pastoral state" received partial
of German rearmament. The Reichswehr had been broken up into
training units ( Ausbildungsstamme) and instruction groups, the new
corps and divisions were only in process of formation, the air-force
and tank units existed mostly on paper only. Of tanks there were
available only a small number of light No. l's with two machine guns
each. . . . On his trip from Cologne to Berlin he [Hitler] admitted
in his special train to a most intimate circle that he had never been
as scared as during the first days of the occupation of the Rhineland.
If the French had then acted, he would have sustained his greatest
political
, defeat. He had not a single brigade to oppose a threat of
war.
2. Our Administration was so bent upon presenting an entire nation
to world public opinion as guilty that the mere mention of the exist-
ence of a German resistance movement was barred by the censors
on top level orders. Cf. Hans Rothfels, The German Opposition to
Hitler (Chicago; Henry Regnery Company, 1948), p . 140.
292
 AMERICA AND THE REPUBLIC OF GERMANY

expression in JCS Order No. 1067 of April 1945 for the

American Zone, and also in the Potsdam Declaration of
August 2, 1945, issued by the three principal victors.
It cropped up again in somewhat mitigated form in the
"level of industryH agreement of March 26, 1946, signed
by the United States, Great Britain, France, and Soviet
Russia.
President Truman realized that the workings of the
Morgenthau Plan and its attenuated successors had cre-
ated a problem which was too formidable to be solved
by the party in power alone. He therefore prevailed upon
Former President Herbert Hoover to undertake an Eco-
nomic Mission to Germany and Austria.
When our Elder Statesman reached Germany in the
bitter winter of 1947, an orgy of dismantling industrial
plants and installations was under way such as the world
had not seen before. All four occupying powers were
guilty of taking apart, seizing on the pretext of repara-
tions, or blowing up of undertakings that by no stretch
of the imagination could be classified as unessential to
the German economy or dangerous to the peace of the
world. The voices of reason opposing such a course were
crying in the wilderness. Also, decartelization was being
carried through with a vehemence that made Mr.
I:Ioover insist that new directives be issued to bring our
economic policies in Germany within the scope and in-
tent of the Sherman Anti-Trust Law.
Herbert Hoover on his return to America issued a
report which finally brought an end to this economic
nonsense. His role in re-establishing economic sanity is
remembered with gratitude by German industry. His
name is revered by Germans generally as that of no
other living American.
With memories of Allied mistakes, especially of the
activity of Morgenthau Plan zealots in American Mil-
293
 TYCOONS AND TYRANT

itary Government still fresh in their minds, German in-

dustrialists are keeping their fingers crossed as the fate
of Germany is being decided in high-level conferences,
hoping that the United States will make rational use of
her tremendous power, so that all nations, including
Germany, may look to her leadership with confidence
and trust in her traditional sense of justice.

In this book I have tried to clear away the rubble of

legend and misrepresentation which obstructs one of the
paths which lead to the truth about the past. My faith in
Germany as a valuable and indeed indispensable mem-
ber of the Western Community was greatly strengthened
by the facts with which my researches brought me face
to face.

294
Index
Index
Adenauer, Konrad, 55, 249, 276,
287
Adolf Hitler Spende, 122 ff.
Aktiengesellschaft ftir Anilinfa-
brikation (AGFA), 41
Alfieri, Dino, 183
Allgemeine Elektrizitiits Gesell-
schaft (AEG), 45, 64, 67, 91,
114,143,223
Allianz Insurance Concern, 108
Amtlich, 4
Anderson, H. C., 245, 250
Angell, Norman, 188
Arbeitsgemeinschaft, Deutsche,
128, 133
Armstrong, Henry E ., 38
Article 48, 2, 142
Associated Press, The, 215
Aussprache, Die, 264, 275
Aviation, 189
Badische Anilin-und Soda-Fabrik,
41,43
Baillet-Latour, Comte de, 183
Bank for International Settle-
ments, 63
Banking Houses, German: Com-
merz- und Privatbank, 106,
112; Deutsche Bank, 108, 112;
Dresdner Bank, 106; Reichs-
kredit-Gesellschaft, 112; I. H.
Stein, 25, 112
Bassermann, Friedrich Daniel,
286
Baur, Georg Carl Friedrich, 205
Bayer, Friedrich, 39
Baynes, Norman H., 152
Bebel, August, 286
Bechstein, Carl, 18, 97
Beethoven, Ludwig van, 154
297
Behrens, Hermann, 143
Bergman, Sigmund, 48
Berliner T ageblatt (Berlin), 87
Berlinske Tidende (Copenhagen),
184
Berndorff, H. R., 21
Bierwes, Heinrich, ll10
Bingel, Rudolf, 106
Bismarck, Gottfried von, 106
Bismarck, Otto von, 286
Blessing, Karl, 108
Blomberg, Werner von, 138, 139,
180, 197, 206
Blumenfeld, Erik, 276
Bohlen, Alfried (see Krupp, Al-
fried)
Bohlen, Berthold von, 258
Bohlen, William Henry Charles,
31
Bohringer, Eugen, 2:27
Borbet, Walter, 199,
Boris III, 183
Bormann, Martin, 123, 229, 242,
243
Born, Max, 45
Borsenzeitung (Berlin), 20
Borsig, Ernst von, 114, 129
Bosch, Carl, 26, 32, 41, 42 fi., 58,
112, 113, 177, 1'79, 191, 214,
223, 225, 233
Bosch, Robert, 26, 4l4, 47 ff., 108,
114, 177, 215, 22,9
Brandi, Ernst, 133
Brassert, Herman Alexander, 175
Brauweiler, Roland, 122, 123
Briand, Aristide, 44
Brockmann, Hugo, 18, 97
Bruning, Heinrich, :2, 16, 92, 93,
110, 111, 121, 13,9
Bucher, Hermann, 45, 46, 64 ff.,
114, 134, 139, 160, 169, 223,
233
Bucher, Karl, 65
Bullock, Alan, 9, 120
Bulow, Fritz von, 37
Buna, 43
Bund zur Erneuerung des Reichs,
64
Bundestag, 23, 271, 290
Bunzl, Eugen, 227
Butefisch, Heinrich, 108, 214
Butenant, Adolf, 58
Cameron, Lord, 183
Chamberlain, Houston Stewart,
18
Chamberlain, Neville, 19, 185,
186, 187, 191, 292
Chinchuk, Leo, 12
Christianity (as basis of German
morals), 140, 170
Churchill, Winston, 184
Ciano, Galeazzo, 184
Clay, Lucius V., 120, 250
Coal: Deutsche Kohlenbergbau-
leitung, 265; Importance of, 5;
]ugenddorf, 267 ff.; Upper Si-
lesian Operators, 245
Co-determination, 258
Cohen-Reuss, Max, 80
Colvin, Ian, 201
Continental Steel Cartel, 190
Corman, Marcus, 267
Dachau, 107, 192, 212
Daily Express (London) , 184
Daily Telegraph (London) , 183
Daladier, Edouard, 186, 191, 292
Daly, Edward J., 245
Depression, Great, 1, 7, 13, 44,
154
Deterding, Henry, 110, Ill
Deutsche Arbeitsgemeinschaft,
128, 133
Deutsche Museum , 45, 63
Deutsche Rundschatt, 110
Dietrich, Otto, 87
Dietz, Hermann, 147
Dix, Rudolf, 237
Dodd, William E., 186
298
Dohring, Johannes, 266
Dorpmuller, Julius, 74
Dresbach, August, 273
Drucker, Peter, 119
Dubois, Josiah E., 200
Duisberg, Carl, 38 ff., 112, 113,
155, 208
Dupont Concern, 43
Ebert, Friedrich, 32, 125, 126
Eckener, Hugo, 230
Eckener, Knut, 230
Economic Groups, German: Fed-
eration of German Iron and
Steel Industrialists, 104, 128;
German Employers' Federa-
tion, 122, 129, 167; Langnam-
verein (Long Name Society),
61, 63, 213; National Federa-
tion of German Industries,
164; National Federation of
German Employers' Associa-
tions, 261; North German Coal
Distributing Office (N GCDO ),
99; Northwest German Em-
ployers' Federation, 61, 96,
104; Northwest Group of Ger-
man Iron and Steel Industrial-
ists, 63, 105, 213; Notgemein-
schaft der deutschen W issen-
schaft, 42, 67, 74; Organiza-
tion for a National Economy
and Working Unity, 159;
Reichsstand der deutschen In-
dustrie, 167; Reichsverband
der deutschen Industrie, q.v.
under "R"; Reichswirtschafts-
kammer, 61; Reichswirt-
schaftsrat, 80, 129; Rhenish-
Westphalian Coal Syndicate
(RWKS), 57, 98 ff.; Schuman
Plan, 59; Verein deutscher
Eisenhiittenleute, 56, 109;
Wirtschaftsgruppe Eisen, 15,
196; Wirtschaftshilfe der
deutschen Studentenschaft, 42;
Working Association of Inde-
pendent Entrepreneurs, 264,
266,274, 275
Eden, Anthony, 185
Edison, Thomas A., 48
Eisenhower, Dwight D., 27, 234
Enabling Act, 150, 156, 170, 180,
219
Erhard, Ludwig, 272, 274
Erwin, Thomas E., 200
Essener Allgemeine Zeitung
(Essen) , 277
European Defense Community,
278, 280
European Federation, 281, 282
Evangelical Academies : Bad Boll,
266; Loccum, 265
Feder, Gottfried, 19, 96
Fette, Christian, 275
Fickendey, E., 66
Fischer, Otto Christian, 112, 216
Flick, Friedrich, 6, 51 ff., 92, 93,
94, 108, 115, 175, 179, 200,
239, 242 ff., 246
Flick Concern, 6, 54, 106, 109,
175
Ford, Henry, 49
Ford Motor Company, 215
Four Year Plan, 46, 141, 181,
218, 219, 235
Fraktionszwang (mandatory vot-
ing), 4, 151
Franck, James, 45
Franco-German Committee (Co-
mite Franco-Allemand), 81
Frankfurter Allgemeine Zeitung,
137, 273
Frankfurter Nachrichten, 114,
223
Frankfurter Zeitung, 114
Freitag, Walter, 275
French occupation, 32, 76, 162
Freundes-Kreis der Wirtschaft,
105, 106, 107
Frick, Wilhelm, 139, 141, 147,
151
Fritsch, Werner von, 137, 197
Fuhrerprinzip, 131, 161, 163,
165, 168
Funk, Walther, 20, 96, 103, 112
Gattineau, Heinrich, 214
General Electric Company of
America, 67
299
General Motors Corporation, 215
Gessler, Otto, 88
Gleichschaltung, 38, 153 ff., 166,
174, 219
Cobbels, Hans, 213
Gobbels, Joseph, 14, 26, 102,
120, 142, 148, 185, 228, 243
Goldschmidt, H. von, 45
Goldschmidt, Thea, 41, 272
Goltz, Rudiger von der, 168
Campers, Samuel, 126
Gordeler, Karl, 37, 88, 230
Coring, Hermann, 46, 58, 60, 78,
96, 102, 139, 143, 144, 146,
147, 150, 182, 185, 195, 197,
200, 207, 208, 218, 230, 232,
235, 243
Coring Werke, Hermann, 60, 175,
176
Corlitz, Walter, 111, 120, 184,
291
.Grassmann, Peter, 130
Grauert, Ludwig, 96, 104
Griessmann, Arno, 205 ff.
Gruber, Karl, 223
Curtner, Franz, 140
Gustav, Adolf, 183
Cute Hoffnungshiitte, 6, 62, 175,
222, 258, 263
Haber, Fritz, 43
Hacha, Emil, 162
Hahn, Otto, 58
Halifax, Lord, 185
Halt, Ritter von, 108
Hamburg-America Line, 106
Handwerk, German, 170
Hanfstaengl, Ernst F . S.
("Putzi"), 111
Hardach, Fritz Wilhelm, 280
Harnack, Adolf von, 58
Harzburg Rally, 18, 21
Hassell, Ulrich von, 88
Hayler, Franz, 107, 239
Hecker, Ewald, 106
Heiden, Konrad, 113, 120
Heinrich I, 108
Heinrichsbauer, August, 101 ff.,
121, 133
Heisenberg, Werner, 58
Helfferich, Emil, 106
Henle, Gunther, 175, 176
Herle, Jacob, 156, 161, 166
Herrenklub, 112
Hess, Rudolf, 76, 95, 122, 174,
200
Hesse, Kurt, 118
Hertling, Georg von, 286
Heuss, Theodor, 51, 215, 289,
290
Hieber, Johannes, 51
Rimmler, Heinrich, 37, 68, 107,
108, 178, 227, 239
Himmler-Kreis, 105, 107
Hindenburg, Paul von, 1, 23 ff.,
32, 92, 93, 111, 113, 115, 136,
138, 139, 140, 148, 150, 155,
163
Hitler, Adolf, 284; unconcerned
about economics, 1, 8, 9, 10,
11, 13, 17, 18, 19; relationship
to Krupp, 21, 26, 27, 30, 32,
36; Industrieklub speech, 42,
45, 50, 64, 68, 72, 76, 79 ff.;
ability at fund raising, 90, 92,
106, 110, 114, 115, 118; out-
smarting Papen, 137; impor-
tance of mass media realized,
138, 142; hypnotic influence,
143 ff., 145; dictatorship com-
plete, 149, 152; corruption
hinted, 155, 170, 177; attitude
toward industrialists, 181; few
industrialists arrested, 185,
191, 195, 197, 212; techni-
cians could criticize, 217;
power of life and death, 221,
224, 230, 236; insane decrees,
252
Hoover, Herbert, 112, 142, 293
Hosch Concern, 6, 133, 175, 214
Hossbach, Friedrich, 197
Rossbach Protocol, 197
Huber, Willi, 100
Hugenberg, Alfred, 17, 18, 70,
77, 86, 92, 137, 140, 149, 158,
163, 166, 171
IG Farben, 7, 38, 40, 41, 44, 67,
108, 112, 113, 114, 123, 143,
300
155, 189 ff., 200, 208, 214,
223, 224, 240, 241, 249
Ihn, Friedrich, 245
Ilseder Hutte, 106
Impedimenta to American-Ger-
man accord, 284 ff., 291 ff.
I ndustrieklub (Dusseldorf) , 77,
79 ff., 109
I nstitut fur Stiindewesen, 174
lnteressentenhaufen, 4
Jackson, Robert H., 200
Janus, Albert, 99
Jews, 44, 68, 73, 74, 78, 91, 143,
157, 158, 159, 172, 173, 179,
180, 182, 183, 215, 216, 226,
229, 232, 241, 289, 290
]ugenddorf, 267 ff.
Kaas, 150, 151
Kaiser Wilhelm Gesellschaft
(later Max Planck), 42, 58, 67
Kalle, W. F., 113
Kaltenbrunner, Ernst, 68
Kardorff, Siegfried von, 15
Kastl, Ludwig, 110, 156, 157,
159, 166, 213
Kauert, Herbert, 100, 109
Kaufmann, Joseph, 200
Kellermann, Hermann, 100
Kemsley, Viscount, 183
Keppler-Kreis, 105
Keppler, Wilhelm Karl, 23, 45,
106, 109
Kerr, Philip, 183
Kessler, Philipp, 168
Keynes, John Maynard, 7, 8
Kirdorf, Emil, 18, 97, 98, 104,
109, 131, 173
Kleine Kreis, 175, 176, 179
Klockner Concern, 6, 175, 257
Klockner, Peter, 110, 175, 177
Klotzbach, Arthur, 175, 177
Kluge, Franz, 278, 279
Kommende, 266, 267
Kost, Heinrich, 265, 270
Kost Plan, 270
Knights of Labor, 48
Kolnische V olkszeitung (Co-
logne), 88
Kottgen, Carl, 160
Kraft durch Freude, 172
Kramer, Hans, 157
Kranzbi.ihler, Otto, 15
Krauch, Carl, 46
Kranefuss, Fritz, 107
Krupp, Alfred, 30
Krupp, Alfried, 31, 36, 201, 225,
239, 245, 247, 250 ff., 279
Krupp, Bertha, 30, 34, 36
Krupp Concern, 6, 17, 30, 31,
52, 63, 162, 175, 199, 201,
203, 206, 208, 222, 257' 278,
279
Krupp, Friedrich-Alfred, 30
Krupp, Gustav von Bohlen und
Halbach, 26, 30 ff., 41, 110,
122, 133, 139, 143, 145,
154 ff., 177, 200, 203, 209,
225, 233
Krupp, Lex, 30
Kruppianer, 34
Kuhnke, Hans-Helmut, 276, 277
Lammers, Clemens, 119, 155,
156, 160, 161
Landfried, Friedrich Walter, 191
Legien, Carl, 126 ff.
Lehmann-Russboldt, Otto, 209
Lehr, Robert, 78
Leipart, Theodor, 134
Leo XIII, 76
Leopold III, 162
Lewald, Theodor, 182
Ley, Robert, 74, 133, 167, 178,
179, 185, 226, 229, 243
Liebknecht, Wilhelm, 286
Liese, Kurt, 206
Lilje, Hanns, 265
Lindemann, Karl, 108
Lippe Election, 90
Lloyd George, David, 183 ff.
Lobe, Paul, 14, 15, 126, 143
Lochner, Louis P., 185
Lokalanzeiger (Berlin), 17
Londonderry, Marquis, 183
Long, Huey, 9
Loser, Ewald, 37, 175
Lubsen, Georg, 175
301
Lucke, Hans von, Jl58, 159, 160,
161, 163
Ludendorff, Erich, 70, 95, 97
Luther, Hans, 64
Lyons, Charles S., :200
M.A.N. (Maschine10fabrik Augs-
burg-Ni.irnberg), 6, 114, 179,
226
Mannesmann Rohrenwerke, 6,
110, 257
McCloy, John J., 5~), 250
Merton, Richard, .2:24 ff.
Metallgesellschaft, 224
Meyer, Emil, 106
Meyer, Otto, 114, ~~26
Milch, Erhard, 73
Miller, Oskar von, 64
Minoux, Friedrich, 97, 142
Moilers, Alfred, Ui8, 159, 160,
161, 163
Mansell, Lord, 1831
Moral Rearmament Movement,
264 ff.
Morgenthau, Hemy, 69, 292,
293
Muller, Hermann, 10
Muller, Ludwig, 1a8
Mi.iller-Orlinghausen, Georg,
155, 160
Munich Day of Appeasement,
187, 193
Mussolini, Benito, 183, 184, 186,
191
National Federatiom of the Elec-
tro-Industry, 168
Nationalzeitung (JEssen), 103,
104
N eues Deutschland (Berlin) ,
100
Neurath, Konstantin von, 139,
162, 180, 185, 1B7
N orthcliffe, Lord, .2~85
North German Lloyd, 108
Noske, Gustav, 12El
Obrigkeitsstaat, 169
Olympic Games, 182
Ordnungsstaat, 286
Papen, Franz von, 23, 28, 92,
93, 112, 115, 136, 138, 139,
180, 231
Parties, Political: Centrist, 2, 5,
12, 16, 113, 150, 171; Chris-
tian Democratic Union (CDU),
276; Communist, 2, 12, 13,
24, 27, 132, 149, 171; Eco-
nomic, 81; German Conserva-
tive ( V olkskonservative), 17,
81, 104, 121; German Demo-
cratic, 21, 71, 81, 92, 113;
German National, 16, 18, 22,
24, 81, 86, 147, 149, 171; Ger-
man People's (Volkspartei),
22, 81, 93, 113, 127, 147, 171,
223; National Socialist (Nazi
or NSDAP), 2, 10, 24, 57, 73,
74, 90, 92, 95, 101 ff., 104,
111, 118, 121, 139, 147, 159,
165, 171, 181, 216, 222; Social
Democratic, 5, 8, 10, 12, 13,
14, 15, 27, 80, 91, 94, 125,
127, 132, 150, 151, 171, 202,
286, 290; V aterland, 10
Paul of Greece, 183
Pechel, Rudolf, 110
Petersen, Alfred, 224
Pichot, Henri, 184
Pietrkowski, Edmund, 157
Pietsch, Albert, 18, 97, 155, 227
Pius XI, 76, 17 4
Pius XII, 119
Planck, Max, 58
Planck Gesellschaft (see Kaiser
Wilhelm Gesellschaft)
Pleiger, Paul, 175, 253
Poensgen, Carl, 59
Poensgen, Ernst, 59 ff., 98, 104,
110, 123, 174, 176, 177, 191,
199
Fonger, Kurt, 117
Popitz, Johannes, 88
Porsche, Ferdinand, 197, 218,
227, 245
Potempa Murder, 13
Pounds, Norman G., 7, 120, 202
Pouplier, Emil, 132
Priisidialkabinett, 24
302
Preussische Kreuzzeitung (Ber-
lin), 127
Proportional Representation, 3,
276
Quint, Herbert A., 111, 120, 184,
291
Raeder, Erich, 197
Rathenau, Walther, 91
Raumer, Hans von, 127 ff.
Raymond, Walter, 261
Reichert, Jakob, 15, 196, 239
Reich.sbahn (Federal Railways),
71, 72, 74
Reichsbanner, 15
Reichstag, 2, 10, 23, 80, 231
Reichstag Fire, 172
Reichsverband der deutschen In-
dustrie, 34, 38, 41, 50, 63, 66,
73, 119, 133, 154 ff., 163 ff.,
174, 213
Reinhardt, Friedrich, 26, 106,
112, 216
Reusch, Hermann, 62, 110, 175,
176, 177, 179, 222
Reusch, Paul, 26, 62 ff., 110,
129, 131, 176, 179, 213, 222
Reves, Emery, 89, 95
Rheinisch-W estfiilische Zeitung
(Essen), 173
Rheinmetall-Borsig, 108
Ribbentrop, Joachim von, 200
Roehling, Hermann, 109, 217,
242
Rohland, . Walter, 179, 216 ff.,
242 ff., 253
Rohm, Ernst, 180, 284
Rohnert, Heilmuth, 108
Roosevelt, Franklin D., 3, 27,
141, 234
Rosterg, August, 26, 106, 214
Rote Fahne (Berlin), 132
Rothermere, Lord, 111
Rothfels, Hans, 292
Riibenach, Eltz von, 139
Ruhrlade, 38, 176
Rupprecht of Bavaria, 12
Sackett, Frederick M., 112, 163
Sauckel, Fritz, 238, 243, 248
Saur, Karl Otto, 255
Schacht, Hjalmar, 21, 26, 80,
105, 106, 112, 143, 146, 180,
216, 219, 230
Schafer, Albert, 179
Schieber, Herr, 255
Schleicher, Kurt von, 28, 92, 93,
115, 136, 137, 138
Schleifenbaum, Ernst, 264
Schlenker, Max Martin, 105, 213
Schmid, Carl Christian, 78
Schmidt, Guido, 184
Schmidt, Heinrich, 106
Schmitt, Kurt, 108, 167, 174
Schnitzler, Georg von, 143, 214
Schroder, Kurt von, 25, 26, 106,
112, 115, 136, 138, 216, 231
Schurz, Carl, 285
Schuschnigg, Kurt von, 162
Schwarz, Ernst, 45
Schwarz, Xaver, 116ff., 118
Schwerin-Krosigk, Lutz von,
139, 180
Seldte, Franz, 140
Sethe, Paul, 137
Severing, Carl, 126
Shaw, George Bernard, 185
Ship Owners, 220 £f.
Siegfried Line, 199
Siemens, Carl Friedrich von, 26,
57, 69 ff., 80, 113, 114, 134,
156, 160, 177, 225
Siemens Concern, 73, 106, 114,
143, 160, 225
Siemens, Ernst von, 74
Siemens, Georg, 7 4
Siemens, Werner von, 69
Siemens, Wilhelm von, 71
Silverberg, Paul, 26, 157, 173,
177, 214
Simson, Ernst von, 157
Slave Labor, 248 ff.
Socialization, 126, 162, 280
Sogemeier, Martin, 253 ff., 265,
267 ff.
Spanish Civil War, 189
303
Speer, Albert, 194l, 216, 222,
238, 239, 242, 2!52, 255
Sprecher, Drexel A., 200
Springorum, Fritz, 133, 160,
177, 214
Stahlhelm, 15
Stahlhof, 60, 105
Stammarbeiter, 244
Stampfer, Friedrich, 12, 132
Stauffenberg, Claus Schenk von,
235
Stauss, Emil Georg von, 112, 216
Stechert, Kurt, 119
Steel Cartel, 190
Stegerwald, Adam, 4, 15, 16
Stein, Baron von, 2,85
Stein, Heinrich von, 112, 216
Stein, I. H., 25, 11~~
Steinbrink, Otto, 106, 109, 253
Stifterverband, 7 4
Stinnes, Hugo, Jr., 98
Stinnes, Hugo, Sr., 51, 53, 56,
57, 63, 97, 126, 129, 271
Stockpiling, 192, 1!96
Strasser, Gregor, ~W, 80, 101,
102, 136, 217
Stresemann, Gustav, 1, 44, 81
Sunday Express (London), 201,
239
Sunday Times (London), 184
Szembek, Count, 183
Tiigliche Rundscha.u (Berlin),
138
Tarnow, Fritz, 134
Tatenmensch, 9
Taylor, Telford, 19!5, 200
Technicians, attitudle toward
Nazism, 172, 21() ff., 218 ff.
Tengelmann, Ernst:, 109, 143,
214, 240, 246
Tengelmann, Walter, 109
Tengelmann, Wilhelm, 109
Terboven, GauleiteJi, 231
Tgahrt, Erich, 175, 176
Thalmann, Ernst, 9,2
Thayer, H. Russel, 200
Thomas, Georg, 19t2, 198, 208,
210, 218, 254
Thyssen, August, 75
Thyssen, Fritz, 18, 26, 32, 75 ff.,
80, 82, 86, 88, 95, 96, 101,
131, 139, 155, 156, 160, 173,
177, 230
Times (London) (see also Sun-
My Times), 38, 184
Todt, Fritz, 194, 242
Toynbee, Arnold, 183
Trade Unions, 61, 63, 67, 71,
78, 125 ff., 166, 263, 281;
Allgemeine deutsche Gewerk-
schaftsbund, 12, 126, 130,
134; Christliche Gewerkschaf-
ten, 12, 15; German Federa-
tion of Labor (post-war), 275;
German Labor Front, 133,
135, 167, 178, 214, 226;
Knights of Labor, 48
Treviranus, Gottfried, 17, 121
Truman, Harry, 234, 293
Tycoons: interested solely in
business, 19; convinced Ger-
many faced disaster-wanted
stable conditions, 27; as re-
garded by people, 29; rela-
tions with trade unions, 125 ff.;
attitude toward first Hitler
cabinet, 155; attitude toward
post-war politics, 271 ff.; sins
of omission, 283
Oberwachungsstelle Eisen und
Stahl, 195
Umberto of Italy, 183
Unions (see Trade Unions)
United States: steel output, 191;
use of power, 294
Vansittart, Robert, 183
Van Vlissingen, Fenterer, 185
Verber, Otto, 117
Vereinigte Stahlwerke (United
Steel), 6, 54, 57, 59, 75, 86,
106, 133, 199, 253
Versailles, Treaty of, 7, 11, 34,
76, 85, 102, 198, 202, 205,
216
304
Villa Hugel, 35, 36, 210
Vinogradov, B., 12
Virchow, Rudolf, 286
Vogler, Albert, 26, 56 ff., 86,
106, 109, 133, 143, 155, 160,
177, 214
Volksgemeinschaft, 86, 178
Volkswagen, 50, 197, 227, 245
Vorwiirts (Berlin), 12, 127
V ossische Zeitung (Berlin) , 88
Wagener, Otto, 96, 158, 160,
161, 163, 167
Walz, Hans, 108
War Crimes Trials, 23, 117, 194,
209, 237, 249, 279
Washington, George, 184
Watson, Thomas J., 185
W ehrmachtsakademie, 193
Weimar Republic, 3, 5, 9, 10,
14, 24, 27, 57, 77, 91, 125,
138, 142, 148
Weinberg, Arthur von, 45
Wels, Otto, 15, 151
Wheeler-Bennett, John W., 136
White, Harry Dexter, 292
Wilhelm, Crown Prince, 12
Wilhelm II, 30, 32, 185, 232
Wilkins, \Villiam J ., 245
Windsor, Duke and Duchess of,
185
Windthorst, Ludwig, 286
Winkhaus, Hermann, 177
Winschuh, Josef, 259 ff., 274
Wolff, Otto, 6, 109, 214
Wolff'sche Telegraphen Bliro,
147
Works Councils, 98, 99, 130,
226, 258, 260, 262, 264
World Economic Conference
(London), 166
Young Plan, 76
Youth, German, 288
Zangen, Wilhehn, 175