IBM and the Holocaust (57 page)

IBM's cable to all subsidiaries involved with Axis nations was approved. Watson's October 1941 instruction did not order his subsidiaries to stop producing punch cards for Nazi Germany. It did not order them to cease all operations. It did not set limits on which projects they could participate in. It did not require offices in neutral countries to stop supporting Hitler's program. It did not proscribe uses in census or registration operations. It did not even demand that spare parts no longer be sent to machines in concentration camps. All that business continued. The cable merely directed managers not to "call on us for any advice or assistance until further notice."

On October 21, 1941, the Treasury Department finally issued IBM a license to communicate the authorization to split the stock—more than a month after the fact.
⁷⁹
A week later, long after IBM submitted its license to instruct all subsidiaries to stop communicating, Chauncey spoke again to Commercial Attache Woods.

C
HAUNCEY
: We have received a license from the Treasury Department for the increase in the Dehomag stock and are sending out a cable to that effect.

W
OODS
: It has been done. Your attorney here had it done the next day after my telephone conversation with Mr. Watson because Mr. Watson had said that it would be all right.

C
HAUNCEY
: Was the stock issued proportionately?

W
OODS
: Yes, you have received your full share. . . .

C
HAUNCEY
: But the stock at present has been issued so that IBM is [the] owner of its proportionate amount of the increase?

W
OODS
: Yes.

C
HAUNCEY
: What I called you for was to explain that in authorizing this increase we wish to be sure that the additional shares to the other stockholders were included in their existing agreements and their agreements made to conform to the present circumstances.

W
OODS
: I do not know about that.

C
HAUNCEY
: Will you see Dr. Albert and have him arrange accordingly? Also, have Dr. Albert return to you the power of attorney which I gave him because of my personal liability for any act which I might commit under it. If, in the future, anything is required to be done we can release the power with specific instructions provided we have a license from the Treasury Department.

W
OODS
: I will see the attorney in a few minutes and tell him. Do you want me to destroy the power of attorney when it is returned?

C
HAUNCEY
: No, you keep it.

W
OODS
: Well, you know it is possible that we may leave here [in the event war is declared], and then do you want me to destroy it?

C
HAUNCEY
: Yes.

W
OODS
: Dr. Kiep and the others send their regards to all of you.

C
HAUNCEY
: We, in turn, send our regards to them.
⁸⁰

IBM faced countless additional emergencies throughout fall 1941, large and small, as it sought to protect its profits and control of its extended Dehomag subsidiary. In one such crisis, Heidinger was waging yet another voting
putsch.
On December 3, as America sensed it stood at the brink of war, a clearly nervous Chauncey again appeared at the State Department with yet another emergency message to be conveyed to Berlin. Mr. Luthringer was the officer on duty. Chauncey gave his IBM business card to the clerk. The card had no address, title, or phone number on it, just the imprint "Harrison K. Chauncey, International Business Machines Corp., New York."
⁸¹

The clerk wrote on the card, "Do you want to see[?]" and drew an arrow to Chauncey's name. Luthringer agreed to see him.
⁸²

Chauncey was carrying a message, and again there was no time to secure a Treasury License. Would the State Department object to sending it? This way, the U.S. government would be sending the message, not IBM. IBM's message was intended for Dehomag through the Geneva office. It read: "Resolution of Executive and Finance Committee of Board of Directors that we will not consent to any change in authority to vote our stock in Dehomag. Dehomag is owned by IBM to the extent of approximately 84 percent and IBM cannot consent to any change in voting control or any other changes until emergency is over. Please inform Albert and Kiep."
⁸³

Luthringer kept notes on his conversation with Chauncey, whom he had met before. "During a previous visit," Luthringer wrote, "he had referred to the fact that the German army used quantities of his company's accounting machinery. Apparently, the Germans move such machinery along with the army in the field." Luthringer added, "I had a feeling from Mr. Chauncey's general remarks that he is somewhat perturbed for fear that his company may some day be blamed for cooperating with the Germans."
⁸⁴

Four days later, Pearl Harbor was bombed. The U.S. finally joined the war against Germany. Dehomag and all Watson subsidiaries under Reich control would now be managed by Nazi-appointed trustees. IBM Europe was saved.

XI FRANCE AND HOLLAND

HOLLAND WAS INVADED IN MAY 1940. QUICKLY, THE COUNTRY
was subjugated to a German civil administration. More than 140,000 Jews, as well as thousands of refugees from Nazism, lived in Holland on the day of invasion.
¹

France fell a month later. After the June 1940 armistice, France was divided into two zones. A so-called Occupied Zone in the north, which included Paris, was ruled by a German military governor backed up by the army and Himmler's Gestapo units. In the south, a collaborationist regime was popularly referred to as Vichy France, after the town of Vichy where the government was headquartered. Alsace-Lorraine was annexed. Approximately 300,000 Jews lived in all of France prior to occupation and dismemberment. About 200,000 of those lived in the Paris area.
²

German intentions in both countries were nearly identical and unfolded in a similar sequence throughout the war years. But everything about the occupation of these lands and their involvement with Hitler's Holleriths was very different. For the Jews of these two nations, their destinies would also be quite different.

Germany frequently exploited ethnic antagonism between national groups in Eastern Europe and ignited long simmering anti-Semitism with Fascist surrogates in such lands as Yugoslavia, Slovakia, Romania, and Hungary. Jews in Eastern Europe often lived apart from the larger society and were subject to class resentment exacerbated by religious isolation. By clever manipulation, the Third Reich was able to divide and conquer democratic or monarchical sovereignties, and then enlist the aid of local Jew-haters to legislate and regiment the methodical destruction of the Jewish community.

But it was different in France and Holland.

In the Netherlands, the population was, with notable exceptions, fundamentally homogeneous. Certainly, traditional Portuguese, colonial, and recent refugee groups each occupied their own niche. Ethnic rivalries, however, were largely non-existent and could not be exploited. Dutch Jews maintained a closely knit community. Only some 12,400 (less than 10 percent) did not affiliate with either of the two leading Jewish ancestral groups. Less than an estimated 2,000 had drifted into Christianity. But Dutch Jews were nonetheless almost completely integrated. Jews could be found among the leaders of literature, jurisprudence, physics, medicine, and manufacturing. Jewish organizations were secularized. Intermarriage was common. By 1930, some 41 percent of the community was in a mixed marriage. Dutch Jewry lived in harmony and acceptance as productive citizens of Holland.
³

France was ethnically diverse, weaving Jews, Christians, and Moslems from across Europe, Asia, and Africa into the fabric of French society. Certainly, strong racial and religious undercurrents continuously rippled, and sometimes exploded. Anti-Semitism had been a fact of life in France for generations—as it had been throughout Europe. The term
J'Accuse
was born amidst the outrage over the Dreyfus Affair. Yet the French had by and large learned to live with ethnic diversity as a strength of their national culture. French Jewry was as completely assimilated as many of their coreligionists in Germany. Jews in France achieved prominence in science, the arts, and politics. France cherished her Jewish painters Pissaro, Chagall, and Modigliani. Theatergoers loved Sarah Bernhardt. Men of letters such as Marcel Proust and Henri Bergson enjoyed wide followings. In 1936, Leon Blum became the first Jew elected premier. Yet Talmudic studies all but disappeared. Baptized or unaffiliated Jews were commonly found throughout a Jewish community that considered itself French first.
⁴

In Holland, punch cards were a well-developed statistical tool. As early as 1916, the Central Statistical Bureau began tracking import and export data on Hollerith machines purchased from an agent for the German company. By 1923, Dutch industry was adopting the technology. The Amsterdam City Electricity Works became the first public utility in the world to use an actual punch card as a regular customer bill. After two Dutch statisticians visited Berlin for demonstrations, the Netherlands chose Hollerith machines to tabulate its 1930 census. By 1937, a centralized "machine park" was developed to serve a multiplicity of government clients. To save money, the Dutch government integrated some locally produced punchers manufactured by Kamatec and Kamadex.
⁵

Watson established a card printing plant in the Netherlands in 1936. In 1939, IBM located a training school in Amsterdam for its European sales force. By that time, the Netherlands was preparing for wartime disruptions by inventorying all sources and stores of the nation's food stocks. Ration cards were regularly issued to all civilians. All information was punched onto cards and sorted by IBM equipment.
⁶

From the outbreak of World War II, Holland standardized on IBM devices. By 1941, the Ministry of Agriculture alone operated 40 machines, which used 1 million Hollerith cards monthly, continuously punched by a staff of 120 punching secretaries. The Statistical Bureau of the Ministry of Economics utilized 98 IBM machines. The Central Statistical Bureau's usage had employed 64 machines. All tolled, the Dutch federal government leased 326 machines from IBM, with an additional 176 Holleriths located in 21 provincial offices, municipal bureaus, and semi-official agencies. Fifteen key corporations used 169 machines. More than 320 machines were employed by non-essential private enterprises. Having surpassed its own card printing needs, by 1941, IBM NY was annually shipping Holland 132 million cards printed in America. Unquestionably, Holland automated its data with Holleriths.
⁷

Ironically, IBM did not operate a subsidiary in Holland throughout the twenties and thirties. The company relied upon highly paid sales agents to close deals. Dehomag in conjunction with IBM Geneva supplied the equipment and expertise. Watson had opened new subsidiaries in Poland and other conquered territories just before or after the Germans invaded. It was no different in Holland. On March 20, 1940, just as Hitler was preparing to launch his spring invasions of the Low Countries and Western Europe, Watson rushed to incorporate Watson Bedrijfsmachine Maatschappij N.V.—the Dutch name for Watson Business Machines Corporation. Reich armies took Denmark on April 9, Norway on May 2, and Luxembourg on May 10. On May 10, Germany also launched its conquest of Holland-it only took five days.
⁸

Throughout the spring invasions, the flow of punch cards to Holland was uninterrupted. Just before the war came to the Netherlands' border, IBM approved an agreement with the Central Statistical Bureau to supply enough cards to last a year. When the Germans entered Holland, they took possession of that supply.
⁹

When originally incorporated in March 1940, two owners of Watson Bedrijfsmachine were listed. IBM NY was shown owning 90 percent of the Dutch company, with 10 percent held by J. W. Schotte, General Manager of IBM Europe. Although a mere nominee, Schotte's shares created the appearance of a Dutch national as principal. Even though Schotte lived in New York, IBM initially listed him as general manager of the Dutch subsidiary. Quickly, however, IBM NY decided to vest all real power in another manager named Pieter van Ommeren. Since by that time the Netherlands was occupied, IBM's secretary-treasurer, J. G. Phillips, on September 17, wrote to the Netherlands Consulate General in exile for permission to circumvent the rules of incorporation. Phillips' sworn letters to the Consulate never identified Schotte as IBM's European General Manager in New York, but merely as a Dutch "merchant" who was "sojourning in the United States."
¹⁰

Some months later, on December 7, 1940, as part of Watson's move to create the appearance of non-communication and reassure Nazi occupiers of non-control, van Ommeren filed an unusual amendment to the articles of incorporation. This amendment deleted the standard clause of closely held corporations to facilitate communications. The words "by telegraph" were removed from the phrase "Shareholders can be consulted in lieu of meeting by writing or telegraph." From December 1940 to mid-June 1941, IBM executives undertook the protracted legal applications to ensure that the exiled Dutch consulate approved the power of attorney given to Ommeren.
¹¹
IBM wanted to make sure that all of its corporate acts in Holland were recognized not only by the Nazi civil administration, but the exiled government as well.