Wall Street and the Rise of Hitler (8 page)

CHAPTER THREE: General Electric Funds Hitler

U.S. government power and prestige to decide international financial matters enhancing Wall Street and General Electric profits. In 1930 Owen D. Young, after whom the Young Plan for German reparations was named, became chairman of the Board of General Electric Company in New York City. Young was also chairman of the Executive Committee of Radio Corporation of America and a director of both German General Electric (A.E.G.) and Osram in Germany. Young also served on the boards of other major U.S. corporations, including General Motors, NBC, and RKO; he was a councilor of the National Industrial Conference Board, a director of the International Chamber of Commerce, and deputy chairman of the board of the Federal Reserve Bank of New York.

Gerard Swope was president and director of General Electric Company as well as French and German associated companies, including A.E.G. and Osram in Germany. Swope was also a director of RCA, NBC, and the National City Bank of New York. Other directors of International General Electric at this time reflect Morgan control of the company, and both Young and Swope were generally known as the Morgan representatives on the G.E. board, which included Thomas Cochran, another partner in the J.P. Morgan firm. General Electric director Clark Haynes Minor was president of International General Electric in the 1920s.

Another director was Victor M. Cutter of the First National Bank of Boston and a figure in the
"Banana
Revolutions" in Central America.

In the late 1920s Young, Swope, and Minor of International General Electric moved into the German electrical industry and gained, if not control as some have reported, then at least a substantial say in the internal affairs of both A.E.G. and Osram. In July 1929 an agreement was reached between General Electric and three German firms — A.E.G., Siemens & Halske, and Koppel and Company — which between them owned all the shares in Osram, the electric bulb manufacturer. General Electric purchased 16% percent of Osram stock and reached a joint agreement for international control of electric bulbs production and marketing. Clark Minor and Gerard Swope became directors of Osram.
7

In July 1929 great interest was shown in rumors circulating in German financial circles that General Electric was also buying into A.E.G. and that talks to this end were in progress

between A.E.G. and G.E.8 In August it was confirmed that 14 million marks of common

A.E.G. stock were to be issued to General Electric. These shares, added to shares bought on the open market, gave General Electric a 25-percent interest in A.E.G. A closer working agreement was signed between the two companies, providing the German company U.S.

technology and patents. It was emphasized in the news reports that A.E.G. would not have participation in G.E., but that on the other hand G.E. would finance expansion of A.E.G. in

Germany.9 The German financial press also noted that there was no A.E.G. representation

on the board of G.E. in the United States but that five Americans were now on the board of A.E.G. The
Vossische Zeitung
recorded,

The American electrical industry has conquered the worM, and only a few of

the remaining opposing bastions have been able to withstand the onslaught...
10

By 1930, unknown to the German financial press, General Electric had similarly gained an effective technical monopoly of the Soviet electrical industry and was soon to penetrate even the remaining bastions in Germany, particularly the Siemens group. In January 1930

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CHAPTER THREE: General Electric Funds Hitler

three G.E. men were elected to the board of A.E.G. — Clark H. Minor, Gerard Swope, and E. H. Baldwin — and International General Electric (I.G.E.) continued its moves to merge the world electrical industry into a giant cartel under Wall Street control.

In February General Electric focused on the remaining German electrical giant, Siemens & Halske, and while able to obtain a large block of debentures issued on behalf of the German firm by Dillon, Read of New York, G.E. was not able to gain participation or directors on the Siemens board. While the German press recognized even this limited control as" an historical economic event of the first order and an important step toward a future world

electric trust,"11
Siemens retained its independence from General Electric — and this independence is important for our story. The
New York Times
reported,
The entire press emphasizes the fact that Siemens, contrary to A.E.G.,
maintains its independence for the future and points out that no General
Electric representative will sit on Stemen's board of directors.
12

There is no evidence that Siemens, either through Siemens & Halske or Siemens-Schukert, participated directly in the financing of Hitler. Siemens contributed to Hitler only slightly and indirectly through a share participation in Osram. On the other hand, both A.E.G. and Osram directly financed Hitler through the Nationale Treuhand in substantial ways. Siemens retained its independence in the early 1930s while both A.E.G. and Osram were under American dominance and with American directors.
There is no evidence that Siemens,
without American directors, financed Hitler. On the other hand, we have irrefutable
documentary evidence (see page 56) that both German General Electric and Osram, both
with American directors, financed Hitler.

In the months following the attempted Wall Street take over of Siemens, the pattern of a developing world trust in the electrical industry clarified; there was an end to international patent fights and the G.E. interest in A.E.G. increased to nearly 30 percent.
13

Consequently, in the early 1930s, as Hitler prepared to grab dictatorial power in Germany

— backed by some, but by no means all, German and American industrialists — the German General Electric (A.E.G.) was owned by International General Electric (about 30

percent), the Gesellschaft für Electrische Unternemungen (25 percent), and Ludwig Lowe (25 percent). International General Electric also had an interest of about 16 2/3rds percent in Osram, and an additional indirect influence in

Companies Linked
to

German General

Relationship of

Electric through

Directors of

Linked Firm with

Common Electric

German General

Financing of

Directors:

Electric (A.E.G.)

Hitler:

Accumulatoran-Fabrik

Quandt

Direct Finance,

Pfeffer

see p, 55

Osram

Mamroth

Direct Finance,

Peierls

see p. 57

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CHAPTER THREE: General Electric Funds Hitler

Deutschen

Landau

Not known

Babcock-Wilcox

Vereinigte Stahlwerke

Wolff

Direct Finance,

Nathan

see p. 57

Kirdorf

Goldschmidt

Krupp

Nathan

Direct Finance,

Klotzbach

see p. 59

I.G. Farben

Bucher

Direct Finance,

Flechtheim

see p. 57

von Rath

Allianz u.

von Rath

Reported, but not

Stuttgarten Verein

Wolff

substantiated

Phoenix

Fahrenhorst

see p. 57

Thyssen

Fahrenhorst

Direct Finance,

see p. 104

Demag

Fahrenhorst

see p. 57

Flick

Dynamit

Flechtheim

Through I.G. Farben

Gelsenkirchener

Kirdorf

Direct Finance,

Bergwerks

Flechtheim

see p. 57

International General

Young

Through A.E.G.,

Electric

Swope

see p. 52

Minor

Baldwin

American I.G. Farben

von Rath

Through I.G. Farben

see p. 47

International Bank

H. Furstenberg

Not known

(Amsterdam)

Goldschmidt

Osram through A.E.G. directors. On the board of A.E,G., apart from the four American directors (Young, Swope, Minor, and Baldwin), we find Pferdmenges of Oppenheim & Co.

(another Hitler financier), and Quandt, who owned 75 percent of Accumlatoren-Fabrik, a major direct financier of Hitler. In other words, among the German board members of A.E.G. we find representatives from several of the German firms that financed Hitler in the 1920s and 1930s.

General Electric and the Financing of Hitler

The tap root of modern corporate socialism runs deep into the management of two affiliated multi-national corporations: General Electric Company in the United States and its foreign associates, including German General Electric (A.E.G.), and Osram in Germany. We have http://reformed-theology.org/html/books/wall_street/chapter_03.htm (5 of 13) [8/4/2001 9:44:13 PM]

CHAPTER THREE: General Electric Funds Hitler

noted that Gerard Swope, second president and chairman of General Electric, and Walter Rathanau of A.E.G. promoted radical ideas for control of the State by private business interests.

From 1915 onwards International General Electric (I.G.E.), located at
120 Broadway in New York City, acted as the foreign investment, manufacturing, and selling organization for the General Electric Company. I.G.E. held interests in overseas manufacturing companies including a 25 to 30-percent holding in German General Electric (A.E.G.), plus holdings in Osram G.m.b.H. Kommanditgesellschaft, also in Berlin. These holdings gave International General Electric four directors on the board of A.E.G., and another director at Osram, and significant influence in the internal domestic policies of these German companies. The significance of this General Electric ownership is that A.E.G. and Osram were prominent suppliers of funds for Hitler in his rise to power in Germany in 1933. A bank transfer slip dated March 2, 1933 from A.E.G. to Delbruck Schickler & Co. in Berlin requests that 60,000 Reichsmark be deposited in the "Nationale Treuhand" (National Trusteeship) account for Hitler's use. This slip is reproduced on page 56.

I.G. Farben was the most important of the domestic financial backers of Hitler, and (as noted elsewhere) I.G. Farben controlled American I.G. Moreover, several directors of A.E.G. were also on the board of I.G. Farben — i.e., Hermann Bucher, chairman of A.E.G.

was on the I.G. Farben board; so were A.E.G. directors Julius Flechtheim and Walter von Rath. I.G. Farben contributed 30 percent of the 1933 Hitler National Trusteeship (or takeover) fund.

Walter Fahrenhorst of A.E.G. was also on the board of Phoenix A-G, Thyssen A-G and Demag A-G — and all were contributors to Hitler's fund. Demag A-G contributed 50,000

RM to Hitler's fund and had a director with A.E.G.— the notorious Friedrich Flick, and early Hitler supporter, who was later convicted at the Nuremberg Trials. Accumulatoren Fabrik A-G was a Hitler contributor (25,000 RM, see page 60) with two directors on the A.E.G. board, August Pfeffer and Gunther Quandt. Quandt personally owned 75 percent of Accumulatoren Fabrik.

Osram Gesellschaft, in which International General Electric had a 16 2/3rds direct interest, also had two directors on the A.E.G. board: Paul Mamroth and Heinrich Pferls. Osram contributed 40,000 RM directly to the Hitler fund. The Otto Wolff concern, Vereinigte Stahlwerke A-G, recipient of substantial New York loans in the 1920s, had three directors on the A.E.G. board: Otto Wolff, Henry Nathan and Jakob Goldschmidt. Alfred Krupp yon Bohlen, sole owner of the Krupp organization and an early supporter of Hitler, was a member of the Aufsichsrat of A.E.G. Robert Pferdmenges, a member of Himmler's Circle of Friends, was also a director of A, E.G.

In other words, almost all of the German directors of German General Electric were financial supporters of Hitler and associated not only with A.E.G. but with other companies financing Hitler.

Walter Rathenau
14 became a director of A,E.G. in 1899 and by the early twentieth century

was a director of more than 100 corporations. Rathenau was also author of the" Rathenau Plan," which bears a remarkable resemblance to the "Swope Plan" — i.e., FDR's New Deal http://reformed-theology.org/html/books/wall_street/chapter_03.htm (6 of 13) [8/4/2001 9:44:13 PM]

CHAPTER THREE: General Electric Funds Hitler

but written by Swope of G.E.

In other words, we have the extraordinay coincidence that the
authors of New Deal-tike plans in the U.S. and Germany were also prime backers of their
implementers: Hitler in Germany and Roosevelt in the U.S.

Swope was chairman of the board of General Electric Company and International General Electric. In 1932 the American directors of A.E.G, were prominently connected with American banking and political circles as follows:

GERARD

Chairman of International General Electric

SWOPE

and

president of General Electric Company,

director of

National City Bank (and other companies),

director of A.E.G. and Osram in Germany.

Author of

FDR's New Deal and member of numerous

Roosevelt organizations.

Owen D. Young

Chairman of board of General Electric, and

deputy chairman, Federal Reserve Bank of

New York. Author, with J. P, Morgan, of the

Young Plan which superseded the Dawes

Plan in 1929. (See Chapter One.)

CLARK H. Minor President and director of International

General Electric, director of British Thomson

Houston, Compania Generale di Electtricita