Wall Street and the Rise of Hitler (7 page)

Paul M.

U.S.

First member of the FEDERAL

WARBURG

RESERVE BANK OF NEW

YORK and BANK OF

MANHATTAN

W.E. WEISS

U.S.

Sterling Products

Source:
Moody's Manual of Investments; 1930, p. 2149.

Note:
Walter DUISBERG (U.S.), W. GRIEF (U.S.), and Adolf KUTTROFF (U.S.) were also Directors of American I.G. Farben

at this period.

The management of American I.G. (later General Aniline) was dominated by I.G. or former I.G. officials. (See Table 9..9..) Hermann Schmitz served as president from 1929 to 1936

and was then succeeded by his brother, Dietrich A. Schmitz, a naturalized American citizen, until 1941. Hermann Schmitz, who was also a director of the bank for International Settlements, the "apex" of the international financial control system. He remained as chairman of the board of directors from 1936 to 1939.

The original board of directors included nine members who were, or had been, members o[

the board of I.G. Farben in Germany (Hermann Schmitz, carl Bosch, Max Ilgner, Fritz ter Meer, and Wilfred Grief), or had been previously employed by I.G. Farben in Germany (Walter Duisberg, Adolph Kuttroff, W.H. yon Rath, Herman A. Metz). Herman A. Metz was an American citizen, a staunch Democrat in politics and a former comptroller of the City of New York. A tenth, W.E. Weiss, had been under contract to I.G.

Directors of American I.G. were not only prominent in Wall Street and American industry but more significantly were drawn from a few highly influential institutions: http://reformed-theology.org/html/books/wall_street/chapter_02.htm (12 of 15) [8/4/2001 9:44:10 PM]

CHAPTER TWO: The Empire of I.G. Farben

The remaining four members of the American I.G. board were prominent American citizens and members of the Wall Street financial elite: C.E. Mitchell, chairman of National City Bank and the Federal Reserve Bank of New York; Edsel B. Ford, president of Ford Motor Company; W.C. Teagle, another director of Standard Oil of New Jersey; and, Paul Warburg, first member of the Federal Reserve Bank of New York and chairman of the Bank of Manhattan Company.

Directors of American I.G. were not only prominent in Wall Street and American industry but more significantly were drawn from a few highly influential institutions. (See chart above.)

Between 1929 and 1939 there were changes in the make-up of the board of American I.G.

The number of directors varied from time to time, although a majority always had I.G.

backgrounds or connections, and the board never had less than four American directors. In 1939 — presumably looking ahead to World War II — an effort was made to give the board a more American complexion, but despite the resignation of Hermann Schmitz, Carl Bosch, and Walter Duisberg, and the appointment of seven new directors, seven members still belonged to the I.G. group. This I.G. predominance increased during 1940 and 1941 as American directors, including Edsel Ford, realized the political unhealthiness of I.G. and resigned.

http://reformed-theology.org/html/books/wall_street/chapter_02.htm (13 of 15) [8/4/2001 9:44:10 PM]

CHAPTER TWO: The Empire of I.G. Farben

Several basic observations can be made from this evidence. First, the board of American I.G. had three directors from the Federal Reserve Bank of New York, the most influential of the various Federal Reserve Banks. American I.G. also had interlocks with Standard Oil of New Jersey, Ford Motor Company, Bank of Manhattan (later to become the Chase Manhattan), and A.E.G. (German General Electric). Second, three members of the board of this American I.G. were found guilty at Nuremburg War Crimes Trials. These were the German, not the American, members. Among these Germans was Max Ilgner, director of the I.G. Farben N.W. 7 office in Berlin,
i.e.,
the Nazi pre-war intelligence office. If the directors of a corporation are collectively responsible for the activities of the corporation, then the American directors should also have been placed on trial at Nuremburg, along with the German directors — that is, if the purpose of the trials was to determine war guilt. Of course, if the purpose of the trials had been to divert attention away from the U.S.

involvement in Hitler's rise to power, they succeeded very well in such an objective.

Footnotes:

1German firms have a two-tier board of directors. The
Aufsichsrat
concerns itself with overall supervision, including financial policy, while the
Vorstand
is concerned with day-to-day management.

2Taken from
Der Farben-Konzern 1928,
(Hoppenstedt, Berlin: I928), pp. 4-5.

3
Elimination of German Resources,
p. 943.

4Ibid, p. 945.

5
New York Times,
October 21, 1945, Section 1, pp. 1, 12.

6Ibid, p. 947.

7
Elimination of German Resources.

8Bernhard is today better known for his role as chairman of the secretive, so-called Bilderberger meetings. See U.S. Congress, House of Representatives, Special Committee on Un-American Activities,
Investigation of Nazi
Propaganda Activities and Investigation of Certain other Propaganda
Activities.
73rd Congress, 2nd Session, Hearings No. 73-DC-4. (Washington: Government Printing Office, 1934), Volume VIII, p. 7525.

9Ibid p. 949.

10Ibid p. 952.

11Ibid p. 1293.

12Ibid p. 954.

13Ibid p. 954.

http://reformed-theology.org/html/books/wall_street/chapter_02.htm (14 of 15) [8/4/2001 9:44:10 PM]

CHAPTER TWO: The Empire of I.G. Farben

14

Ibid, pp. 954-5.

15U.S. Congress. House of Representatives, Special Committee on Un-American Activities,
Investigation of Nazi Propaganda Activities and
Investigation of Certain Other Propaganda Activities, op. cit.

16Ibid, p. 178.

17Ibid, p. 183.

18Ibid, p. 188.

BACK

http://reformed-theology.org/html/books/wall_street/chapter_02.htm (15 of 15) [8/4/2001 9:44:10 PM]

Chart 2-1: German Army (Wehrmacht) Dependence on I.G. Farben Production (1943)

BACK

http://reformed-theology.org/html/books/wall_street/chart2-1.htm [8/4/2001 9:44:12 PM]

CHAPTER THREE: General Electric Funds Hitler

CHAPTER THREE

General Electric Funds Hitler

Among the early Roosevelt fascist measures was the National Industry
Recovery Act (NRA) of June 16, 1933. The origins of this scheme are worth
repeating. These ideas were first suggested by Gerard Swope of the General
Electric Company ... following this they were adopted by the United States
Chamber of Commerce ....
(Herbert Hoover,
The Memoirs of Herbert Hoover:
The Great Depression, 1929-1941,
New York: The Macmillan Company, 1952, p. 420)

The multi-national giant General Electric has an unparalleled role in twentieth-century history. The General Electric Company electrified the Soviet Union in the 1920s and 1930s, and fulfilled for the Soviets Lenin's dictum that "Socialism = electrification."
1
The Swope Plan, created by General Electric's one-time president Gerard Swope, became Franklin D.

Roosevelt's New Deal, by a process deplored by one-time President Herbert Hoover and described in
Wall Street and FDR.
2 There was a long-lasting, intimate relationship between

Swope and Young of General Electric Company and the Roosevelt family, as there was between General Electric and the Soviet Union. In 1936 Senator James A. Reed of Missouri, an early Roosevelt supporter, became aware of Roosevelt's betrayal of liberal ideas and attacked the Roosevelt New Deal program as a "tyrannical" measure "leading to despotism,

[and] sought by its sponsors under the communistic cry of 'Social Justice.'" Senator Reed further charged on the floor of the Senate that Franklin D. Roosevelt was a "hired man for the economic royalists" in Wall Street and that the Roosevelt family "is one of the largest stockholders in the General Electric Company."
3

As we probe into behind-the-scenes German interwar history and the story of Hitler and Naziism, we find both Owen D. Young and Gerard Swope of General Electric tied to the rise of Hitlerism and the suppression of German democracy. That General Electric directors are to be found in each of these three distinct historical categories — i.e., the development of the Soviet Union, the creation of Roosevelt's New Deal, and the rise of Hitlerism —

suggests how elements of Big Business are keenly interested in the socialization of the world, for their own purposes and objectives, rather than the maintenance of the impartial market place in a free society.
4
General Electric profited handsomely from Bolshevism, from Roosevelt's New Deal socialism, and, as we shall see below, from national socialism in Hitler's Germany.

General Electric in Weimar Germany

Walter Rathenau was, until his assassination in 1922, managing director of Allgemeine Elekrizitats Gesellschaft (A.E.G,), or German General Electric, and like Owen Young and http://reformed-theology.org/html/books/wall_street/chapter_03.htm (1 of 13) [8/4/2001 9:44:13 PM]

CHAPTER THREE: General Electric Funds Hitler

Gerard Swope, his counterparts in the U.S., he was a prominent advocate of corporate socialism. Walter Rathenau spoke out publicly against competition and free enterprise, Why? Because both Rathanau and Swope wanted the protection and cooperation of the state for their own corporate objectives and profit. (But not of course for anybody else's objectives and profits.) Rathanau expressed their plea in
The New Political Economy:
The new economy will, as we have seen, be no state or governmental economy
but a private economy committed to a civic power of resolution which certainly
will require state cooperation for organic consolidation to overcome inner

friction and increase production and endurance.
5

When we disentangle the turgid Rathenau prose, this means that the power of the State was to be made available to private firms for their own corporate purposes,
i.e.,
what is popularly known as national socialism. Rathenau spoke out publicly against competition and free

enterprise. inheritance."6 Not their
own
wealth, so far as can be determined, but the wealth of others who lacked political pull in the State apparatus.

Owen D. Young of General Electric was one of the three U.S. delegates to the 1923 Dawes Plan meeting which established the German reparations program. And in the Dawes and Young Plans we can see how some private firms were able to benefit from the power of the State. The largest single loans from Wall Street to Germany during the 1920s were reparations loans; it was ultimately the U.S. investor who paid for German reparations. The cartelization of the German electrical industry under A.E.G. (as well as the steel and chemical industries discussed in Chapters One and Two) was made possible with these Wall Street loans:

Managing

Face

Date of

Bank

Amount

Offering

Borrower

in the U.S.

of Issue

Jan. 26,

Allgemeine

National City

$10,000,000

1925

Elektrizitats-Gesellschaft

Co.

(A. E, G.)

Dec. 9,

Allgemeine National

10,000,000

1925

City Co.

Elektrizitats-Gesellschaft

(A. E.G. )

May 22,

Allgemeine

National City

10,000,000

1928

Elektrizitats-

Co.

Gesellschaft (A.E.G.)

June 7,

Allgemeine

National City

5,000,000

1928

Elektrizitats-Gesellschaft

Co.

(A. E.G.)

In 1928, at the Young Plan reparations meetings, we find General Electric president Owen D. Young in the chair as the chief U.S. delegate, appointed by the U.S. government to use http://reformed-theology.org/html/books/wall_street/chapter_03.htm (2 of 13) [8/4/2001 9:44:13 PM]