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TREASON'S PEACE 



HOWARD WATSON AMBRUSTER 






TREASON'S PEACE 



GERMAN DYES & AMERICAN DUPES 



A CROSSROADS PRESS BOOK 



NEW YORK: THE BEECHHURST PRESS 



COPYRIGHT 1947 
BY HOWARD WATSON AMBRUSTER 



A NOTE OF APPRECIATION AND GRATITUDE 

The material for this volume would neither have been assembled 
nor recorded here except for the loyalty and sacrifice of Ursula 
Ambruster, whose unswerving support despite years of hardship, 
made it possible for both of us to carry on. 

The author is deeply indebted to a number of others whose 
assistance and support have made possible the preparation of 
this book. To name a jew of these would be unfair to the others; 
to name all of those who have aided me would result in disaster 
to those to whom I should not, knowingly, bring disaster. But I 
would be lacking in candor if I did not express here my profound 
appreciation to Jack Morris, to whose untiring efforts its final 
publication is largely due, and to Jack Shuttleworth, for his col- 
laboration in the preparation of this volume. I pay grateful tribute 
also to the fact that, as strangers to me, Jack Shuttleworth and 
Jack Morris came forward from the throng who turned away. 

THE AUTHOR 



PRINTED IN THE UNITED STATES OF AMERICA 



Contents 



Preface The Pattern of Farben vii 

I. Graft and America Unarmed i 

H. Congressman Metz of the Bleeding Heart 15 

III. The Lost Provinces Regained 33 

IV. New Conquests of .America's Industry 47 

V. Farben's Royal Family 69 
VI. "Tarnung" The Magic Hood [which renders 

the wearer invisible] 89 

VII. False Fronts Become Bold 107 

VIII. Republicans Open the Door 132 

IX. Democrats Facing Both Ways 155 

X. Senators and Congressmen Who Never Knew 181 

XI. Two Drug Laws and Two Wars 202 

XH. Patent Medicines and Freedom of the Press 228 

xm. Good Neighbors, and Bad 254 

XIV. Again, Espionage and Sabotage 269 

XV. Propaganda for Wall Street and Washington 286 

XVI. Counter Propaganda and The Lobby 305 

XVH. Alibis and Excuses 313 

XVIII. No Sacrifice on the Altar of Moloch 325 

XDC Behind America's Iron Curtain 350 

XX. Plans for Peace In Time of War 378 

XXI. Another Farben Peace 395 

Conclusion Democracy at Its Worst, and At Its Best 414 

Appendix 4*7 



DEDICATED TO 

CAPTAIN WATSON AMBRUSTER II, U.S.A. AIR FORCE 

AND TO HIS CHILDREN, 

WATSON III AND MARGARET URSULA, 

FOR WHOSE FUTURE SECURITY, WITH 

THOSE OF THEIR GENERATION, THIS STORY 

HAS BEEN WRITTEN. 



PREFACE 



The Pattern ofFarben 



THE HUGE INTERNATIONAL 
chemical combine and cartel leader that is known today as I. G. 
Farben had its beginning some seventy-five years ago, with the 
founding in Germany of six small coal-tar dye companies. By 
1939 these six companies had grown into the ominous-sound- 
ing INTERESSEN GEMEINSCHAFT FARBENINDUSTRIE 
AKTIENGESELLSCHAFT, of FRANKFORT am MAIN, which 
translated literally, means "community of interests of the dye 
manufacturing companies." 

I. G. Farben is usually discussed as a huge German cartel which 
controls chemical industries throughout the world and from which 
profits flow back to the headquarters in Frankfort. Farben, how- 
ever, is no mere industrial enterprise conducted by Germans for 
the extraction of profits at home and abroad. Rather, it is and must 
be recognized as a cabalistic organization which, through foreign 
subsidiaries and by secret tie-ups, operates a far-flung and highly 
efficient espionage machine the ultimate purpose being world 
conquest and a world super-state directed by Farben. 

vii 



PREFACE 

Perhaps the chief distinguishing characteristic of this vast organ- 
ization is the definite pattern to which it holds. From its beginning 
the Farben pattern based upon intensive research wedded to ap- 
plied science, plus a cynical disbelief in the existence of social, eco- 
nomic, or political morality has never varied; its rhythm appears 
changeless. 

This book is the story of the Farben pattern as it has appeared 
in the United States, and a glimpse of its extent in Latin America. 
It is a story of the shadowy designs that repeatedly have come up 
through the fabric of our industrial, social, and political life. 

Viewed over a long period of years it appears as an interlocking 
design of propaganda, espionage, sabotage, and corruption. 

Fragments of this pattern have been revealed to the public from 
time to time in press reports of official investigations and court 
actions here in the United States. These detached items, however, 
could mean little to the public. To understand their significance as 
a part of a never ending menace to world peace the activities of 
Farben must be traced from the beginning, and chronicled in some 
kind of sequence. 

The events in this story are not set forth in chronological order. 
Rather, they are grouped according to subject matter to bring out 
the many designs of the pattern, and to make clear each phase of 
the menace that is Farben. Space does not permit a history of this 
nebulous structure, or the part it has played in German politics in 
making Hitler Chancellor, and providing money and munitions for 
his armies. 

For more than forty years the author, through business, profes- 
sional and official contacts, has followed the activities of this colos- 
sal cartel structure and its predecessors, the "Big Six" dyestuff 
companies. He has followed the establishment of their chemical 
cartels in this country prior to the first World War; the partial 
destruction of those monopolies during that war; and the rebuild- 
ing, in the next two decades, of a far stronger and more sinister 
framework inside our militarily strategic industries, our agencies 
of public opinion, and the very fabric of government itself. 



PREFACE IX 

He believes that the story told here shows clearly that Farben 
was largely responsible for our spiritual and physical disarmament 
when the present war began just as the Big Six was largely respon- 
sible for our unarmed condition at the start of the first World War. 

He believes also, that the story shows what we may expect from 
Farben during the peace. 

It is well to say now that every statement of fact in this book is 
supported by irrefutable evidence in the form of official documents, 
court records, or private papers. From these the reader may draw 
his own conclusions regarding the guilt or gullibility or both of 
some of those American citizens who find mention in these pages. 

Be it admitted that unhappy instances of corruption, double deal- 
ing and cupidity appear and reappear in our history from the 
earliest days of this republic and will continue yet a distinction 
must be made between ordinary violations of our criminal statutes 
and those committed, or secretly instigated, by an enemy which 
is obsessed with the lust of enslaving this nation. 

This, then, is the pattern of Farben. 



CHAPTER 



Graft and America Unarmed 



ON A STORMY 

evening early in 1912, a raiding party armed with a search warrant 
proceeded to one of the fashionable residential districts of Phila- 
delphia, broke down the door, and ransacked the apartment of one 
Alfred J. Keppelmann. 

Mr. Keppelmann was the executive in charge of the Philadelphia 
office of the American Bayer Company, owned and directed by 
one of the leading German dyestuff manufacturers. The local office 
of the Bayer company was at 9 North Water Street, but the young 
attorney who led the raiding party had been tipped off that Mr. 
Keppelmann kept his more important business correspondence in 
his home. 

The tip was a good one and resulted in a rich yield of evidences 
of bribery and fraud engaged in by Mr. Keppelmann over a period 
of years. 

Thus was launched an expose of commercial corruption that is 
without parallel in the history of legitimate business in the United 
States. But that raid was the first of a long series of ineffectual 
blows at the German-controlled chemical cartels that for seventy- 
five years have operated within our bordersineffectual because 



* TREASON'S PEACE 

they have not yet destroyed the corrupt influence and power of 
these monopolies, whose purpose, since their inception, has been 
to stifle our military effectiveness and to strengthen the resources 
of the Fatherland. 

The leading German chemical companies before the first World 
War were known throughout the world as the Big Six. Direct prede- 
cessors of the gigantic I. G. Farbenindustrie, in which they were 
later merged, these six companies were: 

1. Badische Anilin und Sodafabrik. (known as Badische) 

2. Farbenfabriken vorm. Friedr. Bayer & Co. (known as Bayer 
orElberfeld) 

3. Aktiengesellschaft fur Anilinfabrikation. (known as the 
Berlin Company) 

4. Farbwerke vorm. Meister Lucius und Briining. (known as 
theHoechstCo.) 

5. Leopold Cassella G. m. b. H. in Frankfurt, (known as 
Cassella) 

6. Kalle & Company, (known as Kalle) 

All of these companies made dyestuffs and the intermediates from 
which coal-tar dyes are produced; several of them also produced 
pharmaceutical products from coal-tar intermediates and other 
chemical bases. 

There were numerous other smaller German dyestuff producers 
but these six concerns, with several hundred million dollars in 
assets, united early in the century in two cartels, dominated the 
coal-tar industry in Germany, and controlled the world's markets 
for dye stuffs. 

In America, where business was a strictly private affair, and all 
attempts at government supervision were fought tooth and nail by 
our rugged individualists, the Big Six found fertile ground for 
their "peaceful penetration." Here in America with the cooperation 
of the German government, they established their agencies, and 
pursued a ruthless policy of economic strangulation, with the re- 
sult that upon our entry into World War I, America's organic chem- 
ical industry, the very lifeblood of modern warfare, consisted of 
little more than a series of small assembly plants. 

The completeness with which we failed to develop this mili- 



TREASON'S PEACE 3 

tarily strategic industry attests the determination of purpose and 
the typical German thoroughness with which the representatives 
of Kultur carried out, within our borders, their coordination of 
industry with the forces of war. 

The early history of these six German companies takes in the 
birth of the commercial development of dyes made from coal tar. 
Three generations ago these dyes began to replace many of the 
natural or vegetable dyes. However, it was not a German, but a 
young English chemist, William H. Perkin, who discovered in 1856 
that a usable purple, or mauve color, could be produced from 
aniline, the oil-like product distilled from coal tar, which had been 
produced originally in 1826. 

History records that young Perkin was not attempting to make 
a dyestuff at the time, but was experimenting, unsuccessfully, with 
the aniline in an attempt to produce synthetic quinine. Some 70 
years later, one of Farben's chemists succeeded in doing what 
Perkin had set out to do and produced the coal-tar derivative 
known as Atabrine which today, as a substitute for quinine, oc- 
cupies such a vital place in our control of malaria. 

It was the Germans, however, who most industriously followed 
up Perkin's discovery of an aniline dye. Intensive research was 
encouraged at German universities, and by subsidies from the 
German government. The late Congressman Nicholas Longworth 
told of a conversation he had with a distinguished American chem- 
ist who had graduated from the University of Heidelberg many 
years before, and who told Longworth that when he said goodbye 
to his head professor he asked why it was that so much of the 
German research work in chemistry was in the development of coal- 
tar dyes. The professors so engaged were receiving higher salaries 
than their colleagues, and the industries were receiving govern- 
ment bonuses. The German professor replied, "Young man, some 
day this work will save the Fatherland." In light of more recent 
events, that professor can hardly be considered a good prophet, 
but his remark indicated the early German vision of world suprem- 
acy in science out of which the Farben pattern of world conquest 
was to emerge. 

The objectives of the original German dye cartels in the United 
States were by no means confined to obstructing our development 



4 TREASON'S PEACE 

of the dye industry. It was of utmost importance to forestall the 
establishment of any primary phase of the coal-tar industry which 
might make this country independent of Germany for coal-tar in- 
termediates, and for other chemical products used in making dyes 
during peace, or explosives and munitions during war. In the 
early development of the dye industry in Germany, the high cost 
of individual dyes was due to the large quantities of certain by- 
products which had no value but which had to be extracted from 
the coal tar in order to produce the dyes. And the great variety of 
colors was due largely to the continuous research devoted to the 
profitable utilization of these by-products. Despite this research, 
however, the stock piles reached enormous size. Then, early in this 
century the Germans realized the military significance of the coal- 
tar product, trinitrotoluol (TNT) which could readily be made 
from the by-products. Thereupon, research to produce certain new 
colors suddenly ceased, and the stock piles were allowed to 
accumulate for the war that was to come. 

The two Big Six cartels appeared perfectly willing that the few 
American manufacturers who were trying to make dyes should 
continue their struggle to do so, providing they secured the bulk 
of their intermediates from Germany. They laughed at this compe- 
tition, but they were systematic in their price cutting and utterly 
ruthless in their determination that a coal-tar industry which could 
quickly be turned from dyes to munitions should not exist in the 
United States. 

Throughout this period, while our coal-tar industries languished 
or were still-born whenever attempts were made to start them, it 
is estimated that we were letting a billion dollars worth of coal 
gas go to waste annually through the chimneys of the old-fashioned 
beehive ovens in which substantially all of our coke was then made. 
The gas went to waste because we had no coal-tar dye industry 
to make it profitable. 

At one time, when a group of three of the largest American 
manufacturers of heavy chemicals decided to start the production 
of aniline oil so that our feeble dye industry would not be totally 
at the mercy of the Germans, a special emissary of the Big Six 
came to the United States with the impudent demand that produc- 
tion of the oil be stopped, and made the equally impudent offer 



TREASON S PEACE 5 

that the cartels would repay the Americans for such expenditures 
as had been incurred. 

To protect the domestic producers from the price slashing on 
aniline that followed the refusal of the Americans to shut up shop, 
Congress placed a 10 percent duty on aniline oil. The Big Six, 
however, retaliated by dropping the price on aniline far below any 
possible cost of production in the United States. 

Originally the German dyes were exported to the United States 
through houses which handled a variety of imported products. 
Later, exclusive selling agencies or branch houses were established 
here by each of the Big Six. These branches and agencies had their 
main office in New York City, and maintained branches in New 
England, Philadelphia and other centers where dyes were con- 
sumed in quantities by textile, leather, paper and printing ink 
manufacturers. 

The author's first contact with these powerful German firms was 
in the early 1900s, while working on the original production of 
rayon, or artificial silk, as it was then known, in a plant located 
in the suburbs of Philadelphia. Continuous experimental work was 
required in order to determine which dyes were suitable for the 
new textile yarn, and we received much assistance and many fine 
samples of dyes from the local agents of the Big Six. Our interest 
in dyes was confined to samples and laboratory experiments. The 
subject of bulk purchases did not arise, and the matter of graft, of 
which I had heard a great deal in my visits to commercial dyeing 
establishments, never arose. A few years later, however, I cornered 
a textile mill owner, a most forthright citizen with whom I had 
been doing business, and asked him why he tolerated the graft 
which the German dyestuff companies were handing out to the 
boss dyers who used their products. It was common knowledge, I 
told this mill owner, that this bribery was what made it practically 
impossible for the few American makers of dyestuffs to compete 
with the Germans. My friend's reply was characteristic of the 
dejected attitude of the men who were paying the bills for German 
dyes. Without pretending to quote his exact words, his reply was: 
"I know perfectly well that my boss dyer receives bribe money on 
every ounce of dyestuff that goes into the products which my mill 
turns out. However, it happens that we are making money on the 



6 TREASON'S PEACE 

work this man is doing. Now, if I fired him, as I am justified in 
doing, I would have to get another boss dyer. I can't dye these 
fabrics myself, and the new man would also take bribes from the 
German companies. Competent dyers are hard to get, but good or 
bad, they all accept the graft. So why make the change? We mill 
owners all know that this thing exists, but each of us feels that he 
is helpless to do anything about it without risking ruin." 

Not long after this conversation, I was invited to have lunch 
with an executive of one of the American branches of the Big Six. 
This man was a native born American whom I had known when 
he was engaged in another branch of the chemical industry. In 
the past, I had found him a reputable business man. During that 
luncheon he offered me a position with the German company he 
was representing, and quite casually mentioned that one of my 
duties would be to handle the Saturday pay-offs of bribe money 
to the boss dyers. He remonstrated with me when I declined. "It's 
customary," he protested. "Everyone in the industry does it, every- 
one knows it is done and no one is objecting except a few small 
concerns that don't count so why be squeamish about it?" 

I have recounted these personal experiences to illustrate the 
corruption, and the callous acquiescence to it, through which the 
Germans maintained their impregnable monopoly in the American 
dyestuff market during the two decades preceding the first World 
War. Along with the bribery and other dishonest practices went 
the legend, then accepted in America, that products derived from 
coal tar did not present an attractive field for exploitation because 
American chemical brains were inadequate to fathom the mysteries 
of coal-tar dyes. 

However, the bribery of the boss dyers had become so notorious 
that the storm was bound to break. Late in 1911 the grafting was 
brought forcibly to the attention of the top executives of John and 
James Dobson, the oldest and largest of the carpet manufacturers 
in the Philadelphia area. The owners' investigation which followed, 
disclosed that an astounding annual excess cost was being paid by 
their firm for its supply of colors. Also, that the bribery had reached 
much higher up than the boss dyers of the several mills operated by 
the Dobsons. Criminal proceedings of various kinds were started, 
and a group of mill owners from Philadelphia, New York and New 



TREASON'S PEACE 7 

England formed themselves into the Textile Alliance, Inc. This 
group was very bitter at the revelations of how its members were 
being robbed and their employees corrupted by the German dye 
companies. 

This investigation, which began with the raid on Mr. Keppel- 
mann's apartment, was conducted by three Philadelphia attorneys 
under the leadership of the late Thomas Earl White, and lasted for 
several years. Hunolreds of witnesses were examined, and much of 
the sordid story of bribery, corruption and fraud came tumbling 
out and became a matter of court record. 

It might be pointed out here that the American dyestuff market 
of that period was peculiarly susceptible to dishonest manipula- 
tions of both quality and price. The consumers of coal-tar dyes 
were numerous, and most of them operated relatively small estab- 
lishments. Few textile mills or commercial dye houses had labora- 
tories, so formulas and sample dyeings were frequently supplied 
by the Big Six salesmen, through their head-office laboratory. In 
many of the dyeing establishments, individual purchases of vari- 
ous colors and shades, which changed with the fashions, were small, 
and the constant variations made it impossible for the owners, who 
were not dyers, to determine which dye was best or which should 
cost the least. Under these conditions, the owners were compelled 
to depend on their boss dyers. These men were usually highly 
skilled, self-taught artisans, frequently of foreign birth, who carried 
in their heads the trade secrets of mixing colors and blending 
shades for the peculiar requirements of each fabric. They had 
neither union nor guild, each boss dyer was a rugged individualist 
who regarded himself as a master craftsman and held his employer 
in contempt. 

As an illustration of the huge extent of the corruption at the 
time of the exposure, it was revealed that Bayer claimed an allow- 
ance of $700,000 from its colleagues in the German cartel on the 
allegation that this sum represented graft payment in the United 
States for the preceding year. Evidence in another case revealed 
that a mill had been paying eighty-five cents a pound for a black, 
the correct price of which was twenty-one cents. When the graft 
was stopped at another mill, its yearly bills for dyes dropped from 
$265,000 to $125,000. 



S TREASON'S PEACE 

Elaborate systems of bookkeeping and filing were maintained in 
the American offices of the Big Six companies to keep track of the 
graft without revealing more of its details than were necessary. 
These records identified each color or blend shipped on each order, 
with its correct price; the phony name it had been billed under; 
whether salt, which adds to the weight, but doesn't affect the qual- 
ity of the dye, or any other adulterant had been added; and, finally, 
how much bribe money was paid the boss dyer. These records went 
to the New York offices, other copies to the home offices in Ger- 
many. All of the records were in code, except the one set which rep- 
resented the actual billing. These last records were always available 
in case a customer should drop into the office to discuss a previous 
purchase. 

Alfred J. Keppelmann, the branch-office manager who played an 
important part all through this expose, was an upper class German 
who apparently had no inhibitions about the peacetime service he 
owed to the future welfare of the Fatherland. The boss dyers of 
Bayer's important customers were paid by Keppelmann personally, 
and Keppelmann's chauffeur testified to the frequent occasions 
when he drove his employer to call on these susceptible gentlemen. 
Usually the car would be parked around the corner from the dyer's 
home. At other times, this energetic executive would meet his 
beneficiaries at a saloon, or pick them up in his car at some pre- 
arranged place, for Keppelmann had had trouble with salesmen 
who held out on the dyers and wickedly pocketed the graft. In one 
instance he had lost a customer because the dyer only secured half 
the graft he was "entitled" to. According to this dyer'b own testi- 
mony, Keppelmann finally straightened this out by a special Sun- 
day visit to the dyer's home, where he gave the latter his promise 
as a gentleman that there would be no further trouble about the 
graft. "This promise he kept," testified the dyer. "Two or three 
times each month Mr. Keppelmann came to my house and paid me 
the graft money which was due me." 

Another witness, a chemist, who had been employed by the 
Bayer branch, testified that Keppelmann had instructed him to 
experiment in the laboratory to find a compound which, when put 
into a dye bath, would ruin the fabric. This was to be used when 
Keppelmann deemed it advisable to get rid of a competitor. The 



TREASONS PEACE 



compound to be planted had to be one which would not so change 
the dye bath as to be conspicuous, but would be strong enough to 
spoil or streak the material. This, the witness said was a common 
practice and many different compounds were devised to spoil the 
various types of dyes in use. Keppelmann had still another social- 
business side. He kept a yacht on the Delaware River near Phila- 
delphia, and his engineer testified to luxurious yachting parties that 
were given for employees of the textile mills and, on occasion, for 
some of the mill owners themselves: "They served rare food and 
champagne, and ladies were frequently present to help entertain 
the guests." 

Keppelmann also had a private stenographer, one of whose 
duties was to count out the bribe money and place the correct 
amounts in envelopes marked with the code numbers of the boss 
dyers. The stenographer was, of course, in the complete confidence 
of her boss. She even went on the yachting trips at times. After the 
expose, this young lady indicated her willingness to talk freely 
to the investigators, and so was scheduled to become an important 
witness for the prosecution. 

Joseph H. Choate, Jr., distinguished New York lawyer, who was 
one of the early attorneys for the Textile Alliance, told the follow- 
ing story at a Congressional hearing in discussing the bribery prac- 
tices of the Big Six: "A prosecution was begun against the Phila- 
delphia agent of the Bayer Company, and I might say that they had 
the goods on him. The man had a duplicate set of books which 
showed what he paid everybody. All the parties were gathered at 
the trial, which centered around the testimony of a stenographer. 
As the trial was about to be called, somebody burst into the office 
of the District Attorney and threw up his hands. 'It's no use, boys, 
it's all off, the defendant has married the evidence, and it is not 
admissible!' " 

Keppelmann, the night before, had in fact made his stenographer 
the second Mrs. Keppelmann, having divorced his first wife after 
settlement on her of $100,000. The Bayer companies' Mr. Keppel- 
mann was no piker! 

Criminal prosecution of the individuals involved in the dyestuff 
graft was faced with innumerable difficulties, and the attorneys 
representing the mill owners finally decided upon another ap- 



1O TREASON S PEACE 

proach to the problem by invoking provisions of the Sherman 
Antitrust Act against offenders. 

The late Nelson Aldrich, Senator from Rhode Island, had been 
instrumental in having translated and printed as a Senate Docu- 
ment, a revealing German publication called, "The Great German 
Banks and Their Concentration in Connection with the Economic 
Development of Germany" by Professor J. Riesser of the University 
of Berlin, who described in detail the then recent cartel alliances 
of the Big Six dyestuff companies. The professor also indulged in 
a little prophecy which was to come true when he indicated that 
a complete consolidation of all the important aniline producers was 
in prospect. (In 1916 this prophecy was fulfilled when the com- 
panies comprising the Big Six were combined into the German 
I. G. Dyes. ) The translation of this German book turned attention 
to the fact that Germany permitted combinations which the Sher- 
man Act forbade. It was also discovered that the United States 
branches and agencies of the German companies were acting under 
rigid instructions from Germany in dividing the United States 
market on sales. 

More than thirty separate actions under the Sherman Act were 
thereupon instituted in 1913 in the Federal Courts of Pennsylvania 
and New Jersey against the members of the Big Six and their 
agents in the United States; damages were asked not only for 
bribery and dishonest commercial practices, but for combinations 
in restraint of trade by all concerned. In these actions the Big Six 
was represented by a New York attorney, Charles J. Hardy (later 
to become president of American Car & Foundry Company), who 
fought so vigorously for his clients that the cases were never 
brought to trial. All were finally dismissed in 1916, long after the 
outbreak of the war. Before the dismissals, however, large cash 
settlements were made out of court by several of the defendants. 

Twenty-five years later, after Germany had again started a war 
of conquest, another series of anti-trust law actions was instituted 
against the I. G. Farben affiliates and subsidiaries in the United 
States. Among them are the direct successors of the Big Six affili- 
ates; and this time it was not just dyestuffs, but many other vital 
national-defense products which were involved. Again, as will be 
discussed in other chapters, this second series of antitrust suits 



TREASON S PEACE 11 

against the Farben pattern of unlawful practices were ineffectual 
in providing real punishment for the culprits, and were for the most 
part compromised and settled, or remain, at this writing, untried. 

One member of the Big Six, the Hoechst Co., was first repre- 
sented in the United States by an importing house which went 
through several changes to become, in 1902, the H. A. Metz Co., 
of New York. Brooklyn-born Herman Metz, president of this com- 
pany denied on numerous occasions that he or his company had 
ever been involved in the bribery of boss dyers. Elected to Congress 
in 1912, just before the antitrust suits were instituted, Metz said 
that he knew he would be "a shining mark for attack.? "So/* said 
Metz, "I settled, rather than fight in Court." 

In one of his public statements on the subject, made before a 
Senate Committee, Metz declared with some heat that "so much 
is made of this bribing of dyers this tipping business. It is not 
limited to the dye industry/' Metz also pointed out that with the 
exception of Keppelmann, all of the dye company agents involved 
were Americans. "The Germans were not doing it/' said Metz, "it 
was their agents here." 

Metz's special pleading, characterizing the bribing of dyers as 
a customary American way of doing business, constituted a rather 
contemptible libel upon his fellow citizens. The author has been 
active, and behind the scenes, so to speak, in a great many Ameri- 
can industries during the last forty-five years, especially those 
connected with or dependent upon chemical products of one kind 
or another. Commercial dishonesty and fraud have been encoun- 
tered here and there, it has existed and always will exist among 
a small and shifty percentage of the human race. But with the ex- 
ception of one other industry, never in my experience or in the 
knowledge of any one with whom I have discussed the subject has 
there existed in the United States such systematic corruption, on 
a large scale and by a recognized plan, as was engaged in by the 
predecessors of I. G. Farben to obstruct the development of our 
domestic coal-tar industry during the two decades preceding the 
first World War. The one exception mentioned is discussed in a 
later chapter on patent medicines. 

The late Francis P. Garvan, who more than any other prominent 
American fought to destroy the German dye cartel's hold in Amer- 



i* TREASON'S PEACE 

ica and to prevent its reentry after the war, always refused to 
accept the denials of Metz that his company was involved in the 
bribery. Garvan first delved deeply into the affairs of the Metz 
company, and all of the other German dye houses, when he was 
made Chief Investigator for the Alien Property Custodian in 1917. 
He based his allegations about Metz on letters which were taken 
from Metz's own files in the New York offices of the Hoechst Co. 
Metz, said Garvan, was present when these letters were produced 
at Congressional hearings and has never questioned their authen- 
ticity. Some of these letters, addressed to Metz by Dr. Haeuser, 
president of the German company, are revealing. In one of them 
dated July 31, 1913, Dr. Haeuser wrote Metz: 

As for what concerns the paying of dyers I inform you 
confidentially about the development of matters as follows: 
The proper assistance has been explained to the Elberfeld 
(Bayer) gentlemen, at the establishment of the new business 
over there, that they must unconditionally avoid in the future 
any graft, else the matter may become very bad for them. 
Elberfeld has then, the comprehensible endeavor, that not 
they alone, but also all other firms, should cease payments to 
dyers in future. They immediately came to an understanding 
with Ludwigshafen (Badische) and Berlin, and then also 
secured the consent of Cassella. After these four firms were 
agreed, there remained nothing for us to do but to agree 
likewise, as Kalle had also to consent. It is also to be expected 
that still other factories will join, and if they refuse to join this 

shall be used against them among the customers Aside 

from the fact that we were in a forced position, we had little 
cause to hesitate as you wrote to me repeatedly that the pay- 
ments to the dyers must unconditionally stop. We are of the 
opinion that it must be serious, at least for the six firms con- 
cerned, to discontinue all affairs with the dyers in the future, 
and we are furthermore of the opinion that the business will 
get along very well without the payments to the dyers, since 
substantially all large firms share the same point of view. A 
certain transition period is very likely necessary, and therefore 
the union should first go into effect on January 1 of next year. 



PE ACE i 

It will not be feasible then any more that you set expenses in 
the bill; you will have to get along without the expenses. 

Your independence, as far as it is concerned, will not be 
affected by this agreement, and at all events, no one, even in 
America, will wish to reproach us for an agreement whose 
purpose it is to further the discontinuance of the unlawful 
acts on the part of our customers. If you wish to come over 
here this year yet, which would please me very much, I would 
ask you not to arrive here in October, as I must go on my 
vacation in that month after having endured it here the 
whole summer long. In case Mr. George Gordon Battle should 
come here, I will receive him with pleasure. With best greet- 
ings, yours respectfully, 

Dr. Haeuser 

Dr. Haeuser was also the president of "The World Society for 
the Preservation of German Business." Emphatic as this letter ap- 
pears to have been on the matter of stopping the bribing of dyers 
by January 1, 1914, a later letter dated February 6, 1914, from the 
German Hoechst office to Metz indicated otherwise. This letter 
read: 

Now as far as extras are concerned, I hear with regret that 
according to your opinion not much will be changed. I agree 
with you that you will not be able with one stroke to wipe 
out all extras but the striving must be to abolish this unwhole- 
some condition entirely. The propositions that you now make 
seem to me to indicate a practical way in this direction, and 
we are satisfied therewith. 

Again, on March 30, 1914 Metz received another letter from 
Hoechst from which Garvan quoted as follows: 

So far as "extras" are concerned, I am of the opinion that this 
practically amounts to simply a transition period and that the 
same will rapidly go backward. At any rate, all our endeavors 
must be in that direction. Your idea that the paying out of 
extras in future could be done through a third party, in cash, 
as for instance through your carpet mill at Worcester, I do 
not find sound. You give yourself through this into the hands 



14 TREASON'S PEACE 

of such third party, who could at any moment turn against 

you Regarding the charging of your account in your 

letter of March 3, I have to remark that it is not entirely 
clear, as in the past year, besides the $100,000 you also accord- 
ing to your letter of October 14, 1913, have kept back a 
further dividend of $50,000 for extras. As you do not mention 
this last $50,000 it seems to me that you have already used 
this in the previous year for extras. Will you please confirm 
this? 

Said Garvan, "These 'extras' meant graft, pure and simple/' 

Still another light upon the pattern of bribery of the Big Six, 
and the innocent surprise of their executives when exposed, is the 
report of a later convention called by members of the cartel at 
which a resolution was entered upon the minutes reading as fol- 
lows: "Resolved, that henceforth bribery shall be abolished, except 
in the United States and Russia." 



CHAPTER II 



Congressman Metz of the Bleeding 
Heart 



"ENGLAND KEEPS 

her navy intact and her soldiers at home; she will carry on the war 
until the last Frenchman has been killed." With these words Dr. 
Hugo Schweitzer closed his address to a gathering of leading 
textile manufacturers who, with the speakers of the evening, were 
guests of the Drysalters Club of New England on January 20, 1915. 

The next speaker, our old friend, Congressman Herman A. Metz, 
began his address with this statement: "If I had any doubts about 
Dr. Schweitzer's neutrality before I heard him speak tonight those 
doubts are now removed." Thus was fabricated, and approved by 
a member of Congress, this still familiar-sounding canard about 
the British people. 

America had just discovered how dependent she was on the 
chemical industry of Germany. With the outbreak of war in 1914, 
our imports from that country ceased. American manufacturers 
were panicky, and President Wilson was being bombarded with 
demands for relief in the name of the suffering consumers of 
German dyes and pharmaceuticals. Accordingly, the President had 
lodged a formal protest with the British Government a request 
that the blockade be relaxed so that trade between the United 
States and Germany could continue. 



16 TREASON'S PEACE 

Dr. Hugo Schweitzer's address before the Drysalters Club was 
entitled, "The President's Protest to Great Britain and its Justifica- 
tion by Perils to Our Trade and Industries." The speaker was in- 
troduced as president of the American Bayer Co., and former 
president of the Chemists Club of New York. 

The Drysalters Club guests, already in a state of high indigna- 
tion about the dye shortage were, of course, in a most receptive 
mood for an attack upon England. They ate it up that night and 
they spread it far and wide thereafter. 

During that period no public suspicion had been aroused regard- 
ing the under-cover activities of Dr. Schweitzer, and it was not to 
be revealed until later that at the very time of his anti-British 
address the illustrious doctor was secretly making plans to secure 
control of substantially all of the phenol (carbolic acid) then 
manufactured in the United States, in order to prevent its use 
in the manufacture of munitions for England. 

Thomas A. Edison had been a very large consumer of phenol 
as a material for making phonograph records. Prior to the outbreak 
of the war his supply had come from Germany the cartels having 
seen to it that we had no domestic production. However, when his 
foreign supply was threatened, Mr. Edison, with characteristic 
initiative, began producing it here and did so on a scale sufficiently 
large to have a considerable excess supply over his own require- 
ments. This excess would have gone into the production of war 
munitions for Great Britain had not the neutral Dr. Schweitzer 
quietly grabbed every bit of it. 

Schweitzer accomplished this by secretly organizing a company 
called the Chemical Exchange Association which contracted with 
Edison for his entire excess production of phenol. The Chemical 
Exchange was not identified with Schweitzer nor did it become 
known until later that it had been financed with funds supplied 
by the notorious Dr. Heinrich Albert, financial adviser to the 
German Government. Von Bernstorff, the German Ambassador, 
also collaborated in this Schweitzer project. The Chemical Ex- 
change resold all of the Edison phenol to another domestic com- 
pany, also German owned, which used it to make salicylic acid 
for medicinal purposes. 



TREASON'S PEACE 17 

So delighted was Dr. Albert with the success of this means of 
depriving England of munitions that he sent Schweitzer flam- 
boyant congratulations: 

"One should picture to himself what a military coup would 
be accomplished by an army leader if he should succeed in 
destroying three railroad trains of forty cars, containing four 
and one-half million pounds of explosives/' 

Dr. Albert's letter then went on to urge the doctor to next go 
after America's bromine supply, because: 

"Bromine, together with chloral, is used in making nitric 
gases, which are of such great importance in trench warfare. 
Without bromine these nitric gases are of slight effect; in 
connection with bromine, they are of terrible effect." 

When it finally came out that Dr. Schweitzer was the brains 
behind the Chemical Exchange-Edison contract, Schweitzer de- 
fied criticism with an attack upon what he called the "greedy 
explosives manufacturers who were paying fabulous prices for 
carbolic acid." Said Schweitzer: 

"I wish emphatically to state that all carbolic acid purchased 
by me is now and will be converted into 'highly salutary 
medicinal remedies It needs no imagination to real- 
ize how many men would have been killed, wounded, and 
maimed by the use of this enormous quantity of one of the 
highest explosives known. I made Mr. Edison especially happy 
by converting this carbolic acid into medicines, because, as 
he personally said to me, he would dislike very much that 
any of the merchandise manufactured by him should be used 
for killing people." 

These humanitarian sentiments of Dr. Schweitzer might have 
been more impressive but for the fact that those same deadly 
chemical gases, first used by the Kaiser's army at Ypres in viola- 
tion of Germany's pledge at the Hague convention, were manu- 
factured by Dr. Carl Bosch, Schweitzer's colleague in Badische. 
And the formula of one of them, the dread mustard gas, had 



i8 TREASON'S PEACE 

already been invented, in 1913 in a New Jersey laboratory, by a 
Schweitzer employe, Dr. Walter Scheele. The latter, again directed 
by Bayer's Schweitzer, later prepared the incendiary sabotage 
bombs used to destroy ships in New York harbor after World 
War I began. 

During this period, Dr. Schweitzer's activities spread to many 
fields which were remote from his duties as president of a company 
making dyes and pharmaceuticals at Rensselaer, New York. With 
funds supplied by the German Government Schweitzer organized 
the Printers and Publishers Association, and the German Pub- 
lishers Society for the dissemination of Teutonic culture. He is 
also credited with being the instigator of the scheme through 
which the New York Evening Mail was purchased with German 
funds by Dr. Edward A. Rumely, and, for a short time, turned into 
an organ of German propaganda. 

The good doctor's advice was, of course, relied upon by Am- 
bassador von Bernstorff on all problems relating to chemical muni- 
tions. When Congress, to encourage the newly created domestic 
dyestuff industry by an embargo and very high duties, passed the 
Tariff Act of 1916, Schweitzer wrote von Bernstorff that it would 
be "child's play" to defeat the purpose of the bill. A special clause 
in the Act, Schweitzer pointed out, permitted the President to 
remove the duty on certain of the more essential dyes after five 
years. In the meantime, the cartels could absorb the high duties 
and dump dyes into the United States so far below costs that they 
could "apply the lever" and regain domination of the market. Dr. 
Schweitzer's "child's play" also was to include the election of the 
right kind of a President of the United States. "Party politics," said 
Schweitzer, will control whether the President to be elected to 
office "will make an honest effort to abolish the specific duty, and 
again let in the German dyes without restriction." His letter, how- 
ever, did not explain how he proposed to bring about the election 
of the right kind of President. Perhaps he thought the Ambassador, 
or his friend, ex-Congressman Metz, could handle that minor detail. 

The good doctor, of course, was confident that Germany would 
win the war while the United States was being persuaded by 
propaganda and corruption to keep out of it. However, the Farben 



TREASON'S PEACE 19 

pattern is always based on win or lose, and when Germany did 
lose, Farben, as will be shown later, merely moved in and under 
cover of American-born citizens and American corporation, re- 
gained control of many of our vital industries. 

Eventually, it came out that Bayer's Dr. Schweitzer was in 
reality the undercover head of the German espionage and sabotage 
organization in the United States. When Dr. Albert had first 
arrived in the United States, it was Schweitzer who met him and 
supplied him with an automobile. And when the United States 
Government forced Albert's departure in 1917, it was to Dr. 
Schweitzer that he handed over his remaining espionage funds- 
some $1,800,000. 

But busy as he was, Dr. Schweitzer always found time to write 
articles and make public addresses on scientific and business sub- 
jects. These, like his Boston speech to the Drysalters Club, were 
then neatly reprinted in small booklets of uniform design, and 
copies bearing the legend, "Compliments of the Author," were 
mailed to important public and college libraries, and to news- 
papers and other publications throughout the United States. 
Schweitzer always spoke and wrote as a patriotic American citizen 
devoted to the welfare of his country; and observed our relations 
with Germany and England with the detachment of a true scientist. 
Some of the titles of these speeches and articles are of interest: 
"The Present and Future Peril to our Commerce and Industry," 
"German Militarism and Its Influence upon the Industries," "Can 
Germany be Starved into Submission?" The theme was always the 
same, that his fellow- American citizens should learn from scientific 
facts that friendship with Germany was a matter of self-interest. 
How familiar that false slogan has become! In one of his papers 
entitled, "The Chemists' War," Dr. Schweitzer set forth at great 
length how Germany's chemists had contributed more to the suc- 
cess of their country's armed forces than either the Army or Navy. 
He would also seem to have anticipated some of Farben's future 
activities and tie-ups in the United States as he stated in this 
article that German chemists had already solved the problem of 
synthetic rubber, and had made the important discovery of mag- 
nesium-aluminum alloys for war purposes. 



90 TREASON'S PEACE 

A decade later Schweitzer's successors in I. G. Farben were 
making their secret and illegal agreements with American indus- 
trialists to discourage or control all developments here in synthetic 
rubber, magnesium alloys and other war essentials. In another ten 
years when Schweitzer's successors were to give the word to the 
German army: "We are now ready, you may start marching," the 
success of these efforts had contributed greatly to our pitiful state 
of unpreparedness. And when once again Farben's lust for world 
conquest has been thwarted we are now told, again, that as a 
matter of self-interest we should permit Farben's industries to 
survive. 

When Congressman Herman Metz at that Boston meeting in 
January 1915 put his public approval on Dr. Schweitzer's vicious 
anti-English sentiments, he also informed his audience that he 
had just returned from a trip to Germany where he had talked 
to high officials in Berlin and to the leaders of the German dye 
cartels, including, of course, Dr. Schweitzer's German employers in 
the Bayer Company. Anyone who chooses to do so is now welcome 
to assume that Congressman Metz at that time had no knowledge 
or suspicion of the real character and purpose of Dr. Schweitzer's 
activities in the United States. However, in December 1917, shortly 
after Dr. Schweitzer's death, and after at least a part of his secretly 
conducted treasonable activities had become public, Metz, by then 
an ex-Congressman and a colonel in the U.S. Army, joined with 
several other American representatives of the German cartel and 
with other citizens who should have known better, in organizing a 
Hugo Schweitzer Memorial Committee to pay tribute to the sterl- 
ing qualities of this late-departed German spy. 

Five years later Mr. Metz was not quite so proud in public of 
his late colleague, for although he informed a Senate Committee 
in 1922 that Dr. Schweitzer had a right to buy up the phenol supply 
with German money in order to deprive Great Britain of munitions, 
he also referred to Schweitzer's activities as "unpatriotic" and ob- 
jected vigorously to being compared with his former friend. 

The part played by Herman Metz, however, in the German- 
inspired political pressure upon the U.S. Government is indicated 
by the following: 



TREASON'S PEACE *i 

New York, March 6, 1915 
Hon. William J. Bryan, 
Secretary of State, Washington, D. C. 
My dear Mr. Bryan: 

Referring to my letter of yesterday regarding the dyestuff 
situation, I beg to say that I received the following cable this 
morning from Germany via Milan: 'Latest developments make 
further shipments dyestuffs impossible/ The cable was sent to 

me by Dr. Adolph Haeuser the president of the Verein 

zur Wahrung der Interressen der Chemischen Industrie 
Deutchlands, which is composed of the various chemical and 
dyestuff manufacturers of Germany, with headquarters in 
Berlin, and shows the attitude of German manufacturers of 
dyestuffs in the present crisis. It is safe to assume that they 
will take every precaution and go to any length to prevent 
their products from reaching consumers of enemy countries, 
and unless some agreement can be reached to have the pres- 
ent condition modified, the manufacturers of this country 
will suffer as much as those of belligerent countries. 

Yours very truly, 

H. A. Metz. 

Mr. Metz thus served official notice on his own government, in 
the name of the German cartel, that we must change our policy 
toward Great Britain or suffer the consequences. That this diplo- 
matic pressure was inspired by the German Government was made 
clear by an intercepted cable which Dr. Albert sent from the 
United States to his home office on April 26, 1916. In this message 
Dr. Albert said: 

The policy of withholding dyestuffs was at the beginning of 
the war without doubt the only possible one. 

A week after Metz's letter to Secretary Bryan, Ambassador von 
Bernstorff contributed his advice to the home office by cabling 
Berlin that: 

the stock of dyes in this country is so small that 4,000,000 
American workmen may be thrown out of employment 



2 TREASON'S PEACE 

Dyes, in fact, were so scarce that the mills would pay any price 
for such as were available. Old warehouse stocks were overhauled 
and revealed priceless treasure in odds and ends of discarded 
German colors. In one instance a barrel of abandoned dye which 
originally cost 23 cents a pound sold for $7.50 a pound. 

Meanwhile Congressman Metz did succeed in arranging for 
several cargoes of German dyes to be brought to the United States 
through the British blockade and was widely acclaimed in certain 
circles for his success in so doing. Then, on March 11, 1915, the 
British Government issued its Order of Council prohibiting all 
trade with Germany, which so tightened the blockade that further 
shipments appeared impossible. 

In July 1916 the American people received a real thrill of excite- 
ment when it was announced that the German submarine Deutsch- 
land had arisen from beneath the surface of Chesapeake Bay and 
proceeded to a dock in Baltimore to discharge almost 300 tons of 
dyestuffs. These dyes had been concentrated to save cargo space 
and the shipment really represented about 1300 tons of dyes of the 
prewar standards. Hearst's pro-German American hailed this ex- 
ploit "as marking a new era in the world's commercial history." 
Another paper termed it "Man's greatest single victory over the 
forces of the sea." 

It was of course ridiculous to suppose that an occasional sub- 
marine could bring any real relief to the shortage of dyes and 
medicinals that existed in the United States, but as a propaganda 
stunt this first submarine voyage was a great success. So, while 
editorial writers were busy acclaiming German ingenuity, it re- 
mained for a well-known consulting chemist, the late Dr. F. X. 
Harold, to point out that the character of the undersea cargo indi- 
cated that the motive of the German dye trust was propaganda 
rather than profit or real friendship, since an equal amount of 
coal-tar medicinals would have yielded a far greater return, and 
would have been even more welcome. Said Dr. Harold: 

It seems therefore, that Germany's object in sending dyes 
must be regarded as a sort of warning to American manufac- 
turers. If she can postpone, even for a few months, the invest- 
ment of further capital in the American dyestuff industry, it 



TREASON'S PEACE 23 

will facilitate greatly her efforts to regain her dye monopoly 
after the close of the war. 

Despite the selection of the less profitable merchandise for this 
first cargo, almost a million dollars profit to the cartels was rep- 
resented by this single trip. Four months later the Deutschland 
again turned up in an American harbor, this time at New London, 
Connecticut. It was said that this cargo was worth $10,000,000 
and included a limited quantity of drugs, securities and diamonds 
in addition to dyes. 

There was a romantic, Jules Verne-like aspect to the resump- 
tion of commerce between this country and the German dye con- 
cerns, that appealed to the emotions of many Americans. This was 
made good use of in anti-British propaganda, with jests at the 
futility of a blockade when the Germans could outwit the great 
British navy by merely sailing under it. 

The next German submarine that paid us a visit shelled oui 
coast. 

The Senate hearings in 1922 at which Mr. Metz objected to 
being compared with the departed Dr. Schweitzer were held in 
compliance with a resolution introduced by Senator William H. 
King of Utah which called for an investigation of expenditures 
by American dye interests for the maintenance of a lobby at 
Washington. These expenditures, Senator King alleged, were being 
made to secure a wicked monopoly of the domestic dye markets 
by keeping out the Germans. Senator King stated that this was 
most reprehensible. He opened the proceedings with a vituperative 
attack upon American dye manufacturers, and elaborated on six 
reasons which he alleged proved that the domestic dye industry 
needed no embargo to protect it. Ex-Congressman Metz supported 
Senator King's charges, and informed the Committee that he had 
placed at the disposal of the Congress one of his own employes, 
Dr. Eugene R. Pickrell, who had been chief chemist for the U.S. 
Customs Department from 1912 to 1919, and who was therefore 
well qualified to advise the Senators on the pending legislation. 

These hearings were lengthy and many witnesses for and against 
the embargo were heard. Late in the hearings, Mr. Metz's employe, 
Dr. Pickrell did testify, and, after qualifying as an expert on 



*4 TREASON'S PEACE 

domestic dyes and dye imports, gave high praise to the arguments 
and findings of Senator King, which he termed unanswerable. Here 
were three American-born citizens, one a Senator from a western 
state, one an ex-Congressman and ex-army officer, and one an ex- 
government expert, all vigorously opposing the embargo, and 
maintaining that sufficient protection for the new domestic indus- 
try could be had by duties instead. It was only a few years back 
that Mr. Metz's friend, Dr. Schweitzer, had written von Bernstorff 
that it would be "child's play" for the cartel to break through any 
tariff duties, however high. 

Senator King apparently stood for the highest ideals of dis- 
interest: "The war is over," said King, "and if we can begin to 
think in terms of world peace and world unity it will be better 
for the United States." The Senator went back in history more then 
a century and a half, to the first treaty between the United States 
and Germany, to sustain his allegation that the United States 
should not have seized the properties and patents of the German 
dye cartel, and should have returned them after the war. Metz 
pleaded for the ultimate consumers of dyes "for whom my heart 
bleeds," he said. Dr. Pickrell put into the record of these hearings 
page after page of complex tables to support his contention that the 
domestic dye industry did not need an embargo. However, Dr. 
Pickrell made no reply when a letter was introduced showing that 
he, too, had stated previously, before entering the Metz employ, 
that not even a 100 per cent duty on dyes would be as efficacious 
as an embargo. None of these three Americans appeared to be at 
all concerned about the danger to their country if it were again 
to be deprived of an essential war-munitions industry. 

Eight years after these hearings another Senate Committee, 
which was investigating lobbies and lobbyists, drew from one 
Samuel Russell, the former secretary of Senator King, an admis- 
sion that in 1922, in the dye-embargo fight, Mr. Metz had paid 
Russell $1000 in cash to be used in the Senator's campaign for 
reelection and that the money had been handed to the witness 
in Metz's New York office by none other than Dr. Eugene R. 
Pickrell. An account of the relations of these three disinterested 
American citizens, whose hearts bled for world peace and the poor 



TREASON'S PEACE < 25 

consumer, is to be found in the minority report of the 1930 Lobby 
Committee. 

Dr. Pickrell testified that he had left the employ of the H. A. 
Metz Co. the year before, and had opened an office in New York 
as a consulting chemist. He denied repeatedly that he represented 
the German dye cartel, or that he knew anything about its inter- 
ests in the United States. The Committee, however, drew an admis- 
sion from the doctor that his income included payments of $12,000 
a year, plus expenses, from four Farben-controlled companies. 
These four Pickrell clients were: General Dyestuff Corp., of which 
Herman Metz was president; Agfa Ansco fcompany, which, in 
1929, had been taken over by American I. G. Chemical Corp.; 
Kuttruff-Pickhardt & Co., the old Badische agency; and Farben- 
owned Synthetic Nitrogen Products Co. 

To accusations that he had used Senator King's office as his 
headquarters while representing the interests of these clients, and 
had prepared material for the speeches of Senators favoring his 
cause, Dr. Pickrell replied that he only saw Senator King a few 
times. The Committee's Minority report found this statement to 
be "decidedly at variance" with other evidence given before it; 
and called Frank K. Boal, a Washington newspaper correspondent, 
to the witness stand. Mr. Boal testified that it was known among 
newspaper men that when Pickrell was in Washington he could 
be found in Senator's King's office, and that he had seen the doctor 
there with his coat off, dictating to a stenographer. Direct ques- 
tioning also brought out that Dr. Pickrell was the author of ma- 
terial Senator King had presented to the Senate Committee of 
1922. Small wonder the doctor had been so lavish with his praise. 

Ex-Congressman Metz was inclined to be irascible on the wit- 
ness stand, and complained bitterly at questions of Republican 
Senator Arthur R. Robinson, especially those which had to do with 
his activities as treasurer of the American I. G. Chemical Corp., 
ano! that company's relations with Farben. "Everything is infer- 
ence," he protested. Metz also denied vigorously that he was a 
lobbyist, but he did affirm his friendship for Dr. Bosch and the 
German dye companies, and described them as "my friends abroad, 
by whom I have been standing all of these years, and they have 
stood by me." 



26 TREASON'S PEACE 

Prior to the minority report of the 1930 Lobby Committee, I 
had made a number of efforts to awaken the Senate to the menace 
to our national security that was being revealed by that Commit- 
tee. The report was issued May 22, 1930. One of my letters, dated 
March 8, 1930, was as follows: 

Hon. Guy D. Goff, 
United States Senate 
Washington, D. C. 

Dear Senator Goff: 

Noting your remarks in the Senate yesterday regarding the 
activities of Dr. Pickrell, the paid agent of the German I. G., 
it occurs to me to send you herewith copy of a letter addressed 
some time since to the chairman of the Senate Lobby Com- 
mittee. The information contained therein, so far as I can 
learn, has not been utilized as yet for the purpose of develop- 
ing the extent of the activities, the background, and the con- 
nections of this Dr. Pickrell. 

Without attempting to discuss the merits of a high or low 
tariff with relation to any domestic product, I would point out 
that the so-called German I. G. is the one group which has 
attempted to influence pending tariff legislation which, by no 
stretch of imagination, may be said to have any proper motive 
relating to the social well-being or prosperity of our working 
class, our agricultural groups, or the industrial and commer- 
cial developments of the American people. 

It is also obvious that control of our chemical manufactur- 
ing industries means control of the munition plants of the 
next war that control of our pharmaceutical indus- 
try means control of an important factor in the public 

health. 

It is also obvious that secret control of an enormous group 
of the most profitable patent medicines in the United States 
means secret control of the expenditures of unlimited funds 

for advertising with its secret influence on news and 

editorial expression on all subjects. 

I am not an alarmist trying to wave a bloody shirt, but I 
say to you without fear of contradiction that the uncovering 



TREASON'S PEACE 27 

of the tentacles of the so-called German I. G., in every ele- 
ment of our social order in the United States at this time, 
will astound and shock the American people. 

Please use the letter which I have inclosed herewith as you 
see fit. 

Respectfully yours, 
H. W. Ambruster 

Senator GofiE acknowledged receipt of this letter with his 
thanks, and the comment that he would use the material in it to 
advantage if the opportunity arose. Apparently that opportunity 
did not arise. 

A similar letter, sent to Senator Joseph R. Grundy, of Pennsyl- 
vania, received a more forthright reply. "I am quite sure," he wrote, 
"that not only what you stated in your letter but the apprehension 
contained in your closing paragraph are correct, and the Ameri- 
can people have comparatively little knowledge of what is going 
on in this country to undermine their material wellbeing." Sena- 
tor Grundy, a high-tariff Republican, was also a Quaker and 
appears to have had sufficient insight to be fearful of the dangers 
to our future peace. Be that as it may, the Senate took no action. 

Twelve long years after my letters to Senators Goff and Grundy, 
the "shock to the American people" that I then prophesied was 
echoed when Senator Harry S Truman, in another Senate hearing, 
shouted "treason" at revelations of some of the agreements en- 
tered into by the Standard Oil Co. of New Jersey which had 
enabled Farben to obtain such control of our chemical-manufac- 
turing industries that the production of synthetic rubber in the 
United States had been obstructed to the grave injury of our war 
economy. As will be shown in a later chapter, these Standard Oil- 
Farben agreements were actually being arranged and consum- 
mated at the time of Pickreirs activities [and prior to the date 
of my letter to the Senators]. 

After the 1930 exposure Mr. Pickrell dropped out of sight as a 
disinterested dye expert before Congressional Committees. Later, 
he was listed as a director of H. A. Metz Co., and as an attorney 
at 10 East 40th Street, across the hall from the notorious German- 
American Board of Trade which was organized by Herman Metz 



2 8 TREASON'S PEACE 

in 1924 and operated as Farben's high level propaganda machine 
by one Dr. Albert Degener until that gentleman was interned 
after the outbreak of the present war. According to the published 
statements of the Bulletin of the German-American Board of 
Trade, Attorney Pickrell was listed as one of its directors in 1940; 
and as appearing before Secretary of State Hull in protest at the 
British blockade after the war started and before the Treasury 
Department in customs matters in 1941. 

Senator William H. King retired from the Senate in 1940 and 
opened a law office in Washington. As for Herman Metz, it seems 
that while he was still vehemently proclaiming sole ownership of 
his two companies, his loyalty to the German cartel was rewarded 
by the round sum of $1,750,000 the purchase price of his General 
Drug Company and the Metz Laboratories. While Winthrop 
Chemical Company was ostensibly the buyer of these profitable 
enterprises, it was our old friend I. G. Farben that put up $875,000, 
or half the purchase price. 

Ex-Congressman Metz, the Democrat, turned Republican to 
support Harding because his old party was mean to his German 
friends, the American consumer's friend with the bleeding heart 
who had so bitterly denounced the American dye manufacturers 
as an iniquitous monopoly in 1922, and who claimed that he did 
not represent the cartel, in 1925 helped to organize, and became 
president of, the General Dyestuff Corp., a concern that was to 
become the exclusive U.S. sales agency for Farben's dyes. At the 
very time his company was being sued for damages in American 
courts by Farben's Hoechst, Metz was being paid huge sums by 
Farben to turn over his drug and dye interests to Farben's new 
American hideouts. In 1929 Metz helped Hermann Schmitz, chair- 
man of I. G. Farben, organize the American I. G. Chemical Corp. 
which took over the General Aniline Works and the Agfa Ansco 
Corp. Metz became vice-president and treasurer of American I. G., 
and shortly afterward issued a public statement denying that the 
company was a branch of I. G. Farben. In 1934, while still head of 
his German-American Trade Board, after a visit to his friends in 
Farben and in Hitler's new government, Herman Metz died and 
was buried with military honors. 

In 1939, shortly after Germany started the present war, Farben 



TREASON'i PEACE *$ 

caused the American I. G. Chemical Corp. to change Its name to 
General Aniline & Film Corp. In 1941 and '42 multiple indictments 
were filed in U.S. District Courts accusing General Aniline & Film, 
and several other corporations and individuals, of conspiring with 
Hermann Schmitz, and with I. G. Farben to restrict the production 
of dyes and chemicals in the United States, to prevent domestic 
exports from the United States, and to control competition with 
imports from Germany. Among those indicted on these charges 
were the E. I. duPont De Nemours & Co., Inc., and the Allied 
Chemical & Dye Corp. It was also set forth in these indictments 
that systematic efforts had been made from the beginning to con- 
ceal the ownership by I. G. Farben of the American companies 
with which Metz had been associated. 

In December 1941, the Treasury Department seized General 
Aniline & Film Corp., and prior to the seizure, Winthrop, owned 
jointly by General Aniline & Film and Sterling Products, Inc., had 
already been prosecuted for illegal relations with Farben. After 
the seizure, the Treasury removed several of Winthrop's employes 
and officers as objectionable enemy aliens, and a complete removal 
of every trace of the Farben influence was announced. Then, in 
October 1942, the Winthrop management announced in the press 
that as a master stroke of this housecleaning, it had appointed as 
its director of research one Dr. Chester M. Suter, professor of 
chemistry at Northwestern University. One fact, however, that 
the announcements neglected to mention was that Dr. Suter had 
.completed his chemical education at Yale University on what 
was known as the Metz Fellowship. This fellowship was estab- 
lished at Yale in 1925 by Farben's Herman A. Metz and was 
financed thereafter by Metz and his Farben-controlled companies. 

Herman Metz had four sons, one of whom was to carry on with 
Farben as a banker and an aid to its Central Finance Administra- 
tion at Berlin (the polite name for the Farben foreign espionage 
and propaganda bureau ) and who was also to marry into royalty, 
not of the ersatz Farben variety but that of the ancient 14th cen- 
tury duchy of Schleswig-Holstein, subject of many disputes be- 
tween Denmark and Prussia before it became finally an integral 
part of Bismarck's German Empire. 

So, when Richard, son of Herman, in 1941, married Marie Luise, 



30 TREASON'S PEACE 

daughter of the 14th Duke of this Danish-German principality, 
who came from war torn Europe to wed in New York, the family 
of Metz, of humble Brooklyn origin, became linked with the Royal 
families both of Germany and Denmark, and, by those same ties, 
with England's Kings and Queens, and even with Carol of Rou- 
mania. And young Metz also became related, through his princess, 
with the millionaire American Leishman family, the duke's first 
wife having been Nancy Louise Leishman, daughter of our Am- 
bassador to the Kaiser's court when William Howard Taft was 
President. 

As some of the readers of this story may recall in news dispatches 
at the end of the war, it was Princess Valerie-Marie, sister of 
Marie Louise, who was so indignant with a squad of American 
doughboys on their way to Berlin when they bivouacked on her 
16,000-acre estate and permitted her to retain as living quarters 
only 14 rooms of her 300 room palace. 

Richard Metz, according to a report of the American Military 
Government of Germany (O.M.G.U.S. ), as submitted to a Senate 
Committee in 1945, was in Belgium in 1940 in some connection 
with Farben's espionage bureau, and, returning to the United 
States in October of that year, was requested to deliver a message 
to one of Farben's most notorious agents in Latin America, Alfredo 
Moll ( see Chapter xm ) instructing the latter how to get his con- 
fidential reports out of Peru, Brazil or Mexico. 

So Herman's son, as a private banker living on Park Avenue, 
New York, carried on the traditions of the name. 

It would appear to the author that nothing could better reveal 
the threads and texture of the Farben pattern than a study of the 
life and activities of Herman A. Metz, Brooklyn-born American. 
Back in March 1914 in one of the letters written to Metz by Dr. 
Haeuser from which excerpts on bribery of the boss dyers have 
already been cited the head of the German Hoechst Co. wrote 
these significant words: "So far as our other agreements are 
concerned I have no objection to having you send these back; 
our entire relationship is really a confidential relationship, and 
it will be and must without agreements, so continue in the future 
as in the past." When Dr. Haeuser wrote that all-inclusive phrase 
"in the future as in the past" he must have anticipated what was 



TREASON'S PEACE 31 

to happen within the five months following, when Germany was 
to make "scraps of paper" of written agreements, and begin its 
march through Belgium. 

Should Germany have won the first World War, it is interesting 
to speculate on the influence and power which might have come 
to Colonel Herman Metz through his "confidential relationship" 
with Dr. Haeuser and other German cartel leaders. Metz's pre- 
war written agreements with Hoechst might not carry over, but 
the record shows that the confidential relationship was all that 
the. cartel required to hold the Metz loyalty. We have had similar 
revelations of carry-over relationships and post-war understand- 
ings reached by other American industrialists with Farben's leaders 
during the early period of World War II. Metz's career gives at 
least some indication of what Farben's leaders have prepared for,, 
and, unhappily, have a right to expect, in the peace to come, as 
will appear in chapters to follow. 

Herman Metz was self-made. Starting as an office boy he became 
a successful business man, manufacturer, politician, Congressman, 
Army Officer, philanthropist, and leader in many walks of Ameri- 
can life. Always a rough-and-tumble fighter, he stormed through 
all accusations of impropriety with assertions of patriotic motive 
and vindictive slander of his opponent. As a table thumper Metz 
was in a class by himself. 

My personal acquaintance with Metz started just after the first 
World War, when the chemical company of which I was the gen- 
eral manager was supplying the Metz Laboratories with arsenic 
acid. At an official reception at Washington in 1926 I asked Metz 
if he would care to meet my good friend, the late Dr. Charles 
Herty, distinguished engineer and adviser to Francis Garvan in 
many of the latter 's battles with Farben and Farben's agents. 
"Sure" shouted Metz at the top of his lungs. "Where is that old 
son-of-a-bitch? I'll meet him any time, any place, and tell him 
what's what about that gang of goddamned horse thieves he 
runs with." So Mr. Metz started with me to look for the mild and 
gentle doctor, and I was much relieved that we did not succeed 
in finding him in the crowded hall. 

In 1932, several years after I had first publicly denounced 
Farben and its activities in the United States, I had my last 



32 TREASON'S PEACE 

encounter with Herman Metz, and received the high distinction 
of having him call me a lunatic. This was in reply to a letter in 
which I denounced as criminal the advertising slogan of Bayer 
aspirin: "It does not harm the heart/' I did not respond in kind 
to Metz's description of my mentality. 

Instead I sent him a form of affidavit to fill out and sign in 
which, if he chose, he could swear to his approval, as an authority, 
of that advertising claim. This letter also requested Metz to present 
to his friend "Doctor" Weiss, of Sterling, my comments relative 
to the advertising. Metz declined to take advantage of the oppor- 
tunity to give his personal seal of approval to the therapeutic 
qualities of one of Farben's most celebrated products. That he 
was wise in refraining came out some two years later when these 
claims were admitted to be dangerously false in actions brought 
by the Federal Trade Commission as a result of my complaint. 



CHAPTER III 



The Lost Provinces Regained 



ON SEPTEMBER 

1, 1939 when the mechanized armies of Adolph Hitler thundered 
into Poland and began a war which was to spread across the face 
of the earth, most of the people of America were smug in the 
fancied security of their geographical position, entirely unaware 
that a gigantic industrial pincers movement had again rendered 
them very nearly helpless. 

These pincers were the result of a grandiose plan initiated by 
the leaders of the German chemical cartel a few short months 
after the gunfire of World War I had ceased while the exile of 
Kaiser Wilhelm and the feeble pretense of a German Republic 
were being hailed as the birth of a new day for the innocent 
people of the Fatherland. 

In this post-war period of delusion and muddled thinking, 
Farben's predecessors proceeded quietly to reconstruct their inter- 
national framework of industrial and political domination. Dur- 
ing the war many of their properties in America had been confis- 
cated, and a number of their key men deported or interned. For 
these Teutonic tycoons the struggle for world conquest had not 
ended when the German army had quit. The armistice and the 



34 TREASON'S PEACE 

paper peace merely signalled a change in pattern that had been 
determined long before. This time the plan was to be made pos- 
sible by corruption on a scale which would make another failure 
in combat war impossible. Industrial encirclement was to be ac- 
companied with peace propaganda, social espionage and sabotage 
of law enforcement. Compared with these plans the earlier pattern 
of activities of the "Big Six" was insignificant. 

In the last months of 1918 and thereafter, when Germany's 
military leaders were in disgrace, the big boys of I. G. Dyes had 
become the strongest cohesive force in Germany, despite their 
apparently hapless economic plight at the mercy of the Allied 
Reparations Commission. They could say, with some appearance 
of logic, that it was not their fault that the war was lost, and that 
Germany, to be restored, must depend upon their world-wide 
resources and industrial leadership. Their prestige had increased 
by the failure of the military war for which they had been so 
largely responsible. Chemistry had so advanced through the indi- 
vidual efforts of these men that it was now recognized as the key- 
stone of modern warfare. The tremendous increase in the quantity 
and destructiveness of gunfire, due to the use of coal-tar explosives, 
had lifted these Big Six leaders to positions of far greater impor- 
tance in German military circles than had been accorded them 
prior to 1914. The use of poison gas was wholly their plan, and 
the supply of gases had come wholly from their dye factories. 
The process of extracting nitrogen from the air had been invented 
by Dr. Fritz Haber, of the Kaiser Wilhelm Institute, and the nitro- 
gen production of the Badische plants, directed by Dr. Carl Bosch, 
had been on such a vast scale that for the first time Germany had 
become independent of the great nitrate beds of Chile. 

The one great lesson which the I. G. leaders learned from the 
first World War was that their original pattern of industrial con- 
quest had not been sufficiently broad to prevent the twofold 
disaster of the armistice and of the loss of most of their branches 
and properties in the United States. The seizure of thousands of 
their United States patents covering dyes, pharmaceuticals and 
other chemical products had been an especially hard blow, and 
it was of the utmost importance that control over these products 
be regained as quickly as possible. And it was apparent that 



TREASON'S PEACE 35 

better methods must be devised to disguise the American fronts to 
which titles to new patents and processes might safely be trans- 
ferred. Some of the earlier disguises had been too crude and their 
wearers too obvious. The German industrialists had learned their 
lessons from the war, but as events were so tragically to prove, 
the people of the United States had not. 

To some readers, the record which follows of a few of the many 
agreements and tie-ups consummated by Farben in the United 
States may prove a tiresome list of industries, companies and 
dates. However, it is impossible to understand the framework 
which the men of Farben erected in order to destroy our national 
security, unless their activities in this country are pictured in some 
kind of chronological grouping of the more important products 
and companies involved. These industrial tie-ups, the start of the 
German pincers movement in America, included agreements, part- 
nerships and subsidiary controls of every conceivable kind for 
sharing processes, patents, profits and markets. Where specific 
control was not secured by Farben, a sharing of management gave 
Farben great influence; where both were lacking, Farben held 
negative control through its power to withdraw its participation 
and thus destroy the share of profits by which its American asso- 
ciates were induced to serve its purposes. Behind and above writ- 
ten documents and formal legal contracts were verbal under- 
standings and "pledges of gentlemen" which bound certain of our 
American patriots to their Farben associates with personal ties and 
obligations that neither court proceedings nor war itself might 
obliterate. 

The list of American corporations involved in the Farben pat- 
tern reads like a roster of big business, high finance and bi-partisan 
politics in the United States. A roil of the names of the men who 
consummated these tie-ups, and without whose active participa- 
tion the Farben framework would have remained a lifeless skeleton, 
achieves its greatest significance when it is realized that these indi- 
viduals were not the broken-English, German-Americans of the 
Bunds and singing societies. They were and are native born Ameri- 
cans, many of them nationally known industrialists to whom thou- 
sands of their fellow citizens look for leadership. 

In those early post-war years there was a strong feeling of re- 



36 TREASON'S PEACE 

sentment at what the "Big Six" had done, and an equally strong 
and bitter conviction that our new organic-chemical industries 
must be protected against competition from the Germans. This 
latter belief was tempered somewhat by distrust of the two largest 
American companies making dyes, E. I. duPont de Nemours & 
Company, and the National Aniline & Chemical Corp., the latter 
having been absorbed into the huge Allied Chemical & Dye Corp. 
in 1920 by Eugene Meyer, and the late Orlando Weber. 

M. R. Poucher of duPont was a former Badische agent in the 
United States, and William J. Matheson of National Aniline the 
former Cassella agent. Years later it was to be revealed that this 
early distrust of duPont and Allied had some substance of fact to 
support it. As early as 1919 and 1920, while duPont and Allied 
were leading the cry for protection against imported dyes, rep- 
resentatives of both companies were meeting the leaders of I. G. 
Dyes in Germany and France to negotiate for process and market- 
ing agreements on dyestuffs and atmospheric nitrogen. 

It was in this early postwar period that Attorney General A. 
Mitchell Palmer, former Alien Property Custodian, made the 
prediction that: "The next war, if it ever does happen, will be a 
chemists' war, and the country which has the best-developed dye 
and chemical industry is the country which is going to come out 
on top." Mr. Palmer said that, "of all the important industries 
developed during the recent war, none stands out more conspicu- 
ously, or is of more vital importance to the health, the commercial 
life and the preservation of American institutions than the dye 
and chemical industry." There was of course complete agreement 
among patriotic Americans with Mr. Palmer's conclusion that 
the new organic chemical industries should be developed; un- 
fortunately, his forebodings of a future war went unheeded by 
all but a few. 

Throughout this period the author occupied what might be 
called a front-row seat at the fight between friends of the "Big 
Six" and the advocates of a strong American-owned chemical in- 
dustry. Early in 1918 I had become associated with the late Frank 
Hemingway, chemical manufacturer of New York City and Bound 
Brook, N. J., later becoming general manager of his company; 
Hemingway was one of the organizers of the American Dyes In- 



TREASON'S PEACE 37 

stitute, started in 1918 to bring together all of the American manu- 
facturers in the fight to protect the new industry. Later, I opened 
my own office in New York City as a consultant, and, although 
active in other branches of the chemical industry, I was brought in 
contact with many of the principals in the fight for and against 
American-made dyes and drugs. 

It was not long after the armistice that I. G. Dyes resumed open 
business relations with the firm of Kuttroff, Pickhardt & Co., which 
had escaped seizure on the specious plea that it was not a Badische 
branch or subsidiary. However, that firm did not hesitate to re- 
cross the lines into the green pastures of I. G. Dyes as soon as 
the government lifted the ban on communications with Germany. 
William Paul Pickhardt, son of one of the founders, and an 
officer of the company, cabled Badische for prices on dyes, and 
then left for Germany to begin a vigorous campaign to import 
German dyes through his firm dyes which the U. S. Government 
had decreed could come into this country only on license through 
the Textile Alliance, and then only when they were dyes that the 
new domestic producers could not supply. As a result of Pick- 
hardt's activities, the State Department cabled its representative 
at Paris in December 1919 that Kuttroff, Pickhardt & Co. had at- 
tempted to induce the German cartel to refuse to ship dyes to 
America through the Textile Alliance, in order to force all im- 
portations to come through their own company. 

As the German I. G. got under way in their new activities in the 
United States a mass of rumor, conjecture and, in some instance, 
fact, was broadcast as each step was taken. It so happened, how- 
ever, that the first of the new I. G. tie-ups, which was in the drug 
industry, attracted no attention at all. The principal on this side 
was Sterling Products, Inc. (now Sterling Drug, Inc.), a com- 
parative newcomer and relatively unimportant at the time. The 
Sterling executives had a good reason for keeping this first tie-up 
secret, as it was made in direct violation of a pledge they had 
made to the Alien Property Custodian. 

One of the war-time seizures of German property which caused 
great public interest had been that of the American Bayer Co., 
and its subsidiary, Synthetic Patents Corp., and the partial dis- 
closure of the subversive activities of Dr. Schweitzer and some 



38 TREASON'S PEACE 

of his colleagues in Bayer. This company, with the Bayer aspirin 
trademark as its most valuable asset, was the first to be offered 
at public sale in 1918 by the Alien Property Custodian. Sterling 
Products was the buyer for $5,310,000. Details of the sale were 
arranged by Earl I. McClintock, an attorney on the staff of the 
Custodian, and one of the first acts of the new owners was to 
hire this public servant at more than triple his government salary. 

Before the sale was consummated, Francis P. Garvan, then 
Alien Property Custodian, attempted to make sure that the execu- 
tives of the new company were native-born Americans, and de- 
manded their solemn pledge that there would be no renewals of 
the contacts with German interests. 

The rules adopted by the Alien Property Custodian of World 
War I (unlike those of World War II) provided that deception 
by a purchaser of enemy property sold, if acting for an undis- 
closed principal or for resale to, or for the benefit of, a person not 
a United States citizen, should be subject to a fine of $10,000, or 
10 years imprisonment, or both; and the property thus purchased 
should be forfeited to the United States. 

Perhaps as this story unfolds, the reader may ponder on the 
possible relation of this rule to some of the incidents which oc- 
curred after Warren Harding became president of the United 
States. 

The original contact between the Sterling management and the 
German cartels is a matter still shrouded in mystery. In the fall 
of 1919, however, and only a few months after he had given his 
pledge to the U. S. Government, William E. Weiss, president of 
Sterling, was in Baden Baden, Germany, in conference with Dr. 
Karl Duisberg and Rudolph Mann. At these meetings an informal 
understanding was reached in which the German and American 
Bayer companies would work in harmony in marketing Bayer 
aspirin in South America. Within a year Sterling had signed a 
formal, fifty-year agreement on this with the Germans. 

In view of subsequent tie-ups with many of the largest corpora- 
tions in America, through which the cartel extended its pattern in 
dyestuffs and in other chemical industries related to our national 
defense, it is significant that this first new tie-up by the Germans 
was with a relatively small patent-medicine group. Also, that the 



TREASON'S PEACE 39 

agreement provided, among other things, that expenses for "prop- 
aganda, advertising and legal costs," were to be shared, and that 
the Americans were to consult with their German partners on 
their advertising. So far as is known, not one of the many agree- 
ments which Farben had with other American industries men- 
tioned propaganda, advertising and legal costs. 

Sterling, originally known as the Neuralgyline Company, was 
started in Wheeling, West Virginia, in 1901 by two retail drug- 
gists, William E. Weiss and Albert H. Diebold. In 1917, these two 
nostrum vendors purchased the original Sterling Remedies, which 
was marketing a fake, lost-manhood cure called No-Tobac, and 
the candy cathartic, Cascarets, which had as its slogan, They 
Work While You Sleep." Sterling Remedies was founded in 1887 
in Attica, Indiana, and is said to have made its early profits from 
the tasty candy Cascarets rather than from the bad tasting 
No-Tobac. 

Soon after the purchase of Bayer, Sterling organized the Win- 
throp Chemical Company, Inc., to handle Bayer's ethical prepara- 
tions; a name being needed to which none of the odium of Sterl- 
ing's patent-medicine advertising was attached. Winthrop was 
made the vehicle of the second important formal agreement with 
the cartel in 1923. On the basis of a fifty-fifty division of all profits, 
the cartel agreed to assign to Winthrop all of its new medicinal 
patents in the United States. The agreement was perpetual, and 
Sterling also bound itself to keep hands off the trademarks and 
patents of its subsidiaries so as not to interfere with the cartel's 
profit-sharing in Winthrop. 

Weiss had written to a German Bayer executive the day the 
1920 agreement was signed, that some parts of that document were 
not altogether clear and "would have to be worked out in the spirit 
in which it is entered into as forming a copartnership in a joint 
enterprise." When the 1923 Winthrop agreement was signed a 
clause was included by the German Bayer company declaring that 
it was not "a partnership or a joint venture" between the com- 
panies. The Weiss theory of partnership implied an equality 
which, apparently, the Germans did not relish. If Weiss and 
Diebold were to be partners they must be made to understand 
that they were the inferiors in the association. 



40 TREASON'S? FACE 

In 1925 and 1926 the I. G. Farbenindustrie succeeded I. G. 
Dyes, adding to the original "Big Six" and their earlier associates 
another group of five of the larger chemical companies of Ger- 
many. It was then that Farben, with its world-wide affiliates, be- 
came the largest corporate structure in the world's chemical and 
allied industries. A new agreement was then consummated be- 
tween Farben and Sterling by which the Germans' share of Win- 
throp profits was exchanged for assignment of fifty per cent of 
Winthrop's stock. 

In the course of these corporate changes the Metz pharmaceu- 
tical interests were transferred (as revealed in Chapter n) to the 
now jointly-owned Sterling-Farben-Winthrop Company. Follow- 
ing the Metz deal, Farben also contributed another million dollars 
as half of its share of the purchase by Winthrop of the Cook 
Laboratories, and the Antidolor Company. So a total of something 
less than $2,000,000 was all the cash that Farben ever paid to 
recover a firm hold on its pharmaceutical interests in the United 
States, interests which we had been told were wrested from 
Germany for all time during World War I. 

While the details of the agreements with Farben remained a 
secret so far as the public was concerned, in 1926 the fact that 
Sterling-Bayer-Winthrop had close ties with the great German 
cartel began to receive frequent mention in the press. "We now 
have the Metz representation, and the I. G. representation," 
boasted Weiss, "conditions are now different." Yes, conditions 
were, in truth, different. Sterling had become a real power in 
drugs, and Weiss, even then, had visions of the financial and 
political power which his alliance with Farben was to bring him. 

Sterling had also acquired all of Farben's U. S. patent interests 
and marketing rights in cosmetics, perfumery, agricultural in- 
secticides and disinfectants, and all materials used in these prod- 
ucts. As a result of these additions, the Sterling- Winthrop manage- 
ment was able to bring the duPont Company into a Farben tie-up 
and, in 1928, the Bayer-Semesan Company was formed with Weiss 
as president. This company, which was owned coequally by duPont 
and Winthrop, was organized for the development of all inven- 
tions by either party relating to insecticides. (In 1943 Sterling sold 
its 50 per cent share of Bayer-Semesan to duPont. ) 



TREASON'S PEACE 41 

Meanwhile, Sterling had purchased a number of the most profit- 
able patent-medicine concerns in the United States. These in- 
cluded the makers of Fletcher's Castoria, Phillips' Milk of Mag- 
nesia, and other nationally advertised remedies. Then, in 1928 
Weiss started to gather the entire American drug industry into 
one huge cartel; and, with Louis K. Liggett, put together Drug, 
Inc. a holding company for all the Sterling-Bayer- Winthrop prop- 
erties, the United Drug Co. and the Liggett chain of retail drug 
stores. Farben's new affiliate, Drug, Inc., then absorbed Bristol 
Myers Co., owned by the Bristol family makers of Sal Hepatica 
and other so-called home remedies; Vick Chemical Co., owned by 
the Richardson family makers of Vick's Vapo-Rub; and Life 
Savers, Inc., controlled by Edward J. Noble maker of the well- 
known package candies. Each of these companies added to the 
already huge structure of Drug, Inc., and greatly increased the 
far reaching influences of its enormous volume of national adver- 
tising. Its stores and distributors were found in every city in 
America, its salesmen in every hamlet, its advertising slogans 
and products in every home. 

It was at this time that another influential American citizen 
whose name was Musica, but who was known as Donald Coster, 
attempted to induce his good friend, Bill Weiss, to absorb the 
McKesson & Robbins wholesale drug company into the new phar- 
maceutical cartel. It was reported in financial circles that Coster 
worked hard to convince Weiss that it would be a splendid ar- 
rangement to have under his control not only the thousands of 
Rexall-Liggett retail drug stores, but also the hundred or more 
wholesale drug distributors which Coster already had or was 
preparing to absorb in the McKesson & Robbins chain. 

Everyone who was at all active in the drug industry, however, 
had heard rumors that Coster was a common criminal, that 
McKesson & Robbins was based on fraud of some sort, and that 
Coster was planning to unload the securities on the public as 
soon as a financial statement could be put together which would 
enable him to list the securities on the New York Stock Exchange. 

Weiss and his associates, although pressed by some bankers to 
do so, would have none of Coster's fake securities in their Drug, 
Inc., but they did encourage Coster to expand, and thus provide 



42 TREASON'SPEACE 

a more unified distribution for Sterling's increasing lines of drugs 
and patent medicines. 

Any one who chooses to believe that no leader of the drug 
industry knew that Coster was a crook, and his financial empire 
a stack of phony bookkeeping entries, is welcome to that opinion. 
The fact remains, and the record proves, that I knew these things, 
and made repeated attempts to induce Washington to do some- 
thing about them. And if I knew them, so did others. Incidentally, 
the famous accounting firm of Price, Waterhouse & Co., which 
so conveniently overlooked the nonexistence of the McKesson & 
Robbins Canadian warehouse inventories and received more than 
half a million dollars for audits which included examination of 
many of these fraudulent book entries was the same firm which 
has been certifying and approving the books and accounts of 
two of the leading American affiliates of Farben: Sterling, and 
Standard Oil Co. of New Jersey. 

When Drug, Inc., was formed in 1928 Louis K. Liggett made 
the statement that the tie-up of the United Drug Co. with the 
Sterling group had the approval of the Department of Justice. 
Liggett was Republican National Committeeman from Massachu- 
setts, and the Department of Justice, under Coolidge, quite evi- 
dently was not interested in the existing Sterling-Farben agree- 
mentsevery one of which, thirteen years later, was admitted in 
court to have been illegal from the day it was signed. The bless- 
ings of Washington, however, were not proof against the coming 
depression and the ousting of the Republicans which followed. 
In 1933 after Herbert Hoover's oblivion, Drug, Inc., was dissolved, 
and the Sterling group returned to its original status as Farben's 
principal affiliate in the American drug industry. 

In 1928 Sterling became involved in a cartel agreement in the 
vitamin D field through patent rights which Farben had assigned 
to Winthrop in the United States, and around which a tie-up was 
arranged with Wisconsin Alumni, Inc. (This has no connection 
with the University of Wisconsin.) 

Conflicting patents relating to the activating of ergosterol, the 
product so useful in fortifying milk, bread and other food products 
to combat rickets, were thus pooled and restricted. Winthrop, 
duPonr, and numerous other leading pharmaceutical, dairy and 



TREASON'S PEACE 43 

prepared food manufacturers were then licensed under these 
patents by Wisconsin Alumni. 

Meanwhile we observe two figures which appear to be new in 
the Sterling-Farben post-war orbit, in the persons of the notorious 
Dr. Edward A. Rumely, who had been let out of fail by President 
Coolidge after conviction for pro-German activities during the 
first world war (in which Bayer's Dr. Schweitzer was involved), 
and one Robert McDowell Allen, president of the Vitamin Food 
Co., of which Dr. Rumely was organizer and director. 

Under Sterling auspices a new company was organized in 1928 
called Vegex, Inc., with Dr. Weiss, Earl McClintock and Farben's 
Winthrop director, William Hiemenz, as officers, and the Rumely- 
Allen team as directors. Judging by their lavish advertising in the 
Journal of the American Medical Association, and in Hygeia, 
Vegex and Vitamin Food Co. specialized in pepping up soups and 
gravies with Vitamin B, but this advertising was repudiated later 
by Dr. Fishbein's Council on Foods and Nutrition. 

Dr. Weiss soon lost his enthusiasm for these tasty soup and gravy 
flavors, or for the lack of profits so derived; and Sterling turned 
Vegex over to Mr. Allen who became president of Vegex as well 
as of Vitamin Food, with Dr. Rumely still on their directorates. 

However the Sterling-Winthrop-Farben interest in the Wiscon- 
sin Alumni licenses for ergosterol continued unabated, and in 
1937 we find Dr. Weiss and his colleagues again discussing Farben 
vitamin matters with Dr. Rumely. (The latter, by that time was 
engaged in a new variety of educational propaganda, as will be 
revealed later.) 

In 1935 another new Sterling-Farben subsidiary called Alba 
Pharmaceutical Co., was organized with capital supplied jointly 
by Farben and Winthrop, and with Weiss's son William E. Weiss, 
Jr., as president. This company received the processes and Ameri- 
can patents of two of Farben's German subsidiaries. Meanwhile 
all of the Sterling-Farben tie-ups relating to Bayer or affecting 
property and patents originally purchased at the auction of 1918, 
were in direct violation of the pledge given to the Alien Property 
Custodian. In a little over a decade, Weiss and his associates had 
built up Sterling with German aid into a corporate structure 
which dominated the entire pharmaceutical industry in America, 



44 TREASON'SPEACE 

Weiss and McClintock dominated the small group directing 
Sterling, and participated in the constant exchange German- Ameri- 
can visits which the ramifications of the mutual interests of Sterl- 
ing and Farben made necessary. Albert H. Diebold, more con- 
servative, was the financial wheel horse, and James Hill, Jr., a 
former Internal Revenue official, the controller and treasurer. 
Another member of this select little band was Edward S. Rogers, 
the Weiss legal adviser, whose connection with the company dates 
back almost half a century. Rogers, like McClintock, had been asso- 
ciated with the Alien Property Custodian during World War I. 
He signed the 1926 Winthrop contract with Farben as witness for 
the signature of Weiss, and later represented the Sterling interests 
before government officials in tariff controversies. He attained 
prominence after 1929 as the American delegate to several inter- 
American conferences held in South America on trademarks and 
industrial properties. The importance of these conferences was 
made clear some ten years later, when Thurman Arnold stated 
that, "German control of drug outlets in South America has been 
one of the most effective instruments of propaganda and German 
influence in this hemisphere." 

The late Frank A. Blair, president of Sterling's Centaur Com- 
pany, and of the Proprietary Association, which Sterling domi- 
nated, was one of this group until he died in 1939. Blair, as will be 
shown later (in Chapter xi), was also a power behind the scenes 
at Washington. 

In 1941 Weiss and Diebold were forced out of Sterling because 
of their personal relations and contacts with Farben. The others 
remained; McClintock as president of Sterling International in 
charge of foreign sales, Rogers as chairman of the board, and Hill 
as president. Weiss died after an automobile collision in Wisconsin 
in 1942. His death was as sudden and as unexpected as had been 
the mysterious demise in 1917 of Dr. Hugo Schweitzer, his prede- 
cessor as head of the American Bayer Company. 

Once the cartel had regained a foothold in the United States 
through the friendly offices of our patent-medicine patriots, they 
lost no time in initiating the next step of their pincers strategy. 
Embargo and high tariff could keep out most of the German- 
made dyes, but there was nothing to prevent the "Big Six" from 



TREASON'SPEACE 45 

engaging in the production of dyes within the United States, 
always providing that American companies and American citizens 
could be induced to make these dyes inside the new tariff walls. 
Certain of our citizens not only did not object, they actually 
welcomed the Germans with open arms sold them their hold- 
ings, took them in as partners or entered into agreements and 
iron-clad contracts to share patents, profits and markets. 

In 1919 the Grasselli Chemical Company had established itself 
firmly as a domestic dye producer by purchasing from Sterling 
all of the dyestuff interests, including patents which Sterling ac- 
quired with the American Bayer Co. In 1924 Grasselli made an 
agreement with German Bayer to pool their respective United 
States interests in dyes in a new company known as Grasselli 
Dyestuff. Profits were to be divided equally and the initial Ger- 
man stock interest, forty-nine per cent, was to equal that of the 
Americans as soon as certain financial obligations were met. The 
control of foreign markets remained with the I. G., but the latter 
bound itself to turn over all of its United States patents on dye- 
stuffs to the new company. It was also agreed that the produc- 
tion of heavy chemicals by Grasselli should be restricted. 

Then, in 1926 when the huge I. G. Farbenindustrie cartel was 
formed in Germany, another new company known as General 
Dyestuff Corp., became the sales agent for all of the dyes made 
by Farben's affiliates in this country. And the Germans were back 
in American dyes, in the one industry that can be converted over- 
night to poison gas and munitions production. 

Dr. Carl Bosch, head of I. G. Farbenindustrie, was not im- 
pressed when the League of Nations outlawed the use of chemi- 
cal gas in warfare. The League had also abolished the use of 
force as an international policy, and the United States had taken 
the lead in disarmament. These peace moves fitted splendidly 
into the Farben pattern, and Bosch was all the more determined 
upon a complete penetration into every phase of the American 
dye industry. In 1928 Grasselli was taken over by duPont, and 
the latter thereupon was induced to hand over to Farben the 
entire Grasselli interests in the dyestuff industry. The transfer 
of title of the Grasselli dye interests to the Farben-owned General 
Aniline Works passed first through the hands of Farben's handy 



46 TREASON'SPEACE 

man, Herman Metz, and gave the Germans another good-sized 
chunk of the new American dye industry. Farben's strategy was 
crabwise, when a direct approach was repulsed. 

Later Allied Chemical & Dye joined with duPont in agreements 
with Farben's Continental dye cartel covering certain foreign dye 
markets; these agreements were extended several times to cover 
different countries. Other agreements between duPont and Farben 
covered license or assignment of dye patents in the United States 
and Germany. These various interests required many meetings 
and understandings, the final outcome of which (according to 
allegations in several indictments handed down in 1941 and 1942 
by Federal Grand Juries), was to enable Farben, acting through 
General Aniline & Film and other American companies, to re- 
strict production of dyes and intermediates in the United States, 
and to eliminate competition through market-sharing in foreign 
countries. 

When World War II began, Farben was not in such complete 
control of the coal-tar dye industry in the United States as its 
predecessors had been in 1914, but in 1939 Farben's American 
drug and dyestuff affiliates were much more powerful than those 
"Big Six" agents who had so effectively prevented the establish- 
ment of our munitions industry prior to the first World War. 
Drugs and dyes were Farben's "lost provinces" in industrial 
America. Deprived of the whole loaf, Farben had crept back 
through side doors and cellar windows and seized a good half, 
meanwhile adding its own Nazi flavor to the entire composition. 



CHAPTER IV 



New Conquests of America's 
Industry 



THE OIL INDUSTRY 

came next on Farben's agenda. There were several reasons for 
this, the main one being that Standard Oil Co. of New Jersey, the 
largest industrial corporation in the world, was reported to be 
interested in new chemical developments which were related to, 
or based on, the petroleum and natural-gas industries. The Ger- 
mans knew that these new chemical products promised to be 
among the most important munitions of the next war. So Farben, 
within a few brief years, had induced the leaders of the all-power- 
ful Standard Oil to pay them over $30,000,000 for an oil refining 
process that turned out to be a commercial fizzle in the United 
States. They also bamboozled the New Jersey executives into turn- 
ing over to them technical details of the new chemical processes 
which Standard Oil's research men might discover; and were given 
control of the exploitation of such processes as well. Thus the 
Farben overtures turned into an industrial strip poker game, the 
results of which would have been highly amusing had not so 

47 



TREASON S PEACE 



much of the Standard Oil raiment which passed over to Farben 
been processes and products vital to our national security. 

The first understanding between Farben and Standard was in 
1925, according to statements made subsequently to stockholders 
by Walter C. Teagle, then president of Standard. This informal 
understanding developed into negotiations of a comprehensive 
character and, in 1926, an agreement was drafted covering ex- 
ploitation by Standard of Farben's new refining process for the 
hydrogenation of oil through the use of tremendous pressures. 
This process was the bait which brought about the strange union 
between Farben and Standard a union which ultimately went 
far afield from petroleum, and led Senator Truman to cry "treason" 
at a Senate hearing after Germany had declared war upon the 
United States. 

In 1927 a formal contract was consummated between Farben 
and Standard by which Farben agreed to supply the details of 
its new refining process to Standard, and Standard agreed to erect 
a commercial plant in the United States to demonstrate the process. 
Others were to be licensed to use the processes on a royalty basis 
in which Farben would share. Standard paid Farben with more 
than a half -million shares of its stock, worth approximately $30,- 
000,000, as c6nsideration for this contract. In addition to the stock 
transfer, Standard expended a great many more millions erecting 
hydrogenation plants in the United States and demonstrating that 
the process did not come up to the rosy expectations of its young 
technical expert, Robert T. Haslam, who had inspected the Farben 
plant in Germany, and had recommended the purchase. Appar- 
ently Standard missed one point about this new high-pressure 
cracking method its cost. Farben used it to produce gasoline 
from coal. Germany had plenty of coal, and to the Germans, the 
excessive cost of the gasoline over that produced from oil was not 
important. They knew that the time was coming when Germany 
would again begin war and probably be cut off from the most 
of its crude oil supplies by another British blockade. 

Dr. Bosch and Hermann Schmitz played the leading parts for 
Farben in negotiating the 1927 contract; Teagle and Frank A. 
Howard, who was later made head of Standard Oil Development 
Company, looked after the interests of Standard and its stock- 



TREASON'S PEACE 49 

holders. To Farben this tie-up was of vast importance, because 
it not only established a close working alliance with the world's 
largest industrial company, but it was also to lead to tie-ups with 
other American companies on important chemical developments 
related to the petroleum industry. Some of these new processes 
have little real relation to oil, but they did very directly relate 
to Farben's preparation and our own lack of preparation for 
World War II. 

Other aspects of Standard Oil which made it an ally of great 
potential value in Farben's eyes included the fact that its dis- 
tribution system of filling stations reached into the intimate life 
of so many communities. Unlike Sterling, prior to the latter's ex- 
pansion, Standard already had a nation-wide army of employes. 
Also, Standard's organization was world-wide in South America 
and the Far East as well as in Europe. This army could feel the 
pulse, and possibly even change the beat, of countless blood- 
streams. Standard's political power and influence with many gov- 
ernments were not the least of its attractions to Farben. 

That Farben had long contemplated and sought such an ar- 
rangement was indicated by a statement made early in 1926 to 
William Weiss by one of the Farben leaders that they had to be 
careful in negotiating with Sterling for any products other than 
pharmaceuticals, because Farben was already negotiating with 
Standard Oil, and did not want to give Sterling any of the products 
that should go to the other company. Standard was big game, even 
for Farben, and had to be stalked with great care. Personal friend- 
ships between the negotiators sometimes count much in affairs of 
this sort, and personal ties were made use of in this instance. 
Agreements are entered into by corporations acting as legal en- 
tities but they are negotiated, wrangled about, drawn up and 
signed by corporation officials who are real persons, not legal 
fictions. Mr. Teagle, in a public statement quoted in the New 
York Times in November 1929, referred to his "close and pleasant 
personal relationship of some years standing with the leaders of 
the I. G.," which, said Teagle, was the reason why he had con- 
sented to serve as a director of the newly organized American 
I. G. Chemical Corp., in which he denied Standard had any 
financial interest. 



50 TREASON'S PEACE 

Dr. Bosch of Farben reciprocated these expressions of Teagle's 
friendship in 1930, after Teagle had interceded between Farben 
and duPont in a controversy relating to the manufacture of syn- 
thetic ammonia. Bosch wrote his friend Teagle to thank him for 
arranging the meeting with Lammot duPont, and concluded his 
letter with: 

"I believe that as a result of this intervention, the deadlock 
in the negotiations between duPont and I. G. has now been 
overcome, and that thereby our desire will be realized to 
reach a cooperation with this very energetic and cleverly 
proceeding firm, which we have endeavored to bring about 
for years. The reason for the failure of our former negotiations 
may be the lack of the right personal contact which has now 
been established, thanks to your personal interest." 

Farben was the largest corporation in Germany and the great- 
est chemical cartel in the world; Standard was the largest indus- 
trial corporation in the world; duPont was not much smaller and, 
with its multiplicity of products and its stock control of General 
Motors, U. S. Rubber, Remington Arms and others, it ranked with 
Farben and Standard in importance. When it came to drawing up 
written contracts, however, or even arriving at gentlemen's agree- 
ments, it was the conclusion of Dr. Bosch that the earlier refusal 
of the huge duPont Corporation to play ball was due mainly to the 
aloofness of Mr. duPont an aloofness which Mr. Teagle, as mutual 
friend, had changed into the right personal contact. On the other 
hand it is quite possible that recollections of the part played by 
Bosch and his associates in World War I lingered longer in the 
memory of Lammot duPont than they did in that of Walter Teagle. 

After the 1927 contract Farben and the Standard leaders con- 
tinued their meetings, Farben constantly pressing Standard with 
the advantages of a more comprehensive tie-up between the two 
companies. At one of these meetings, early in 1929, Dr. Bosch 
stated that it appeared certain Standard would be compelled to 
expand its activities far beyond oil refining, into the chemical 
field, and naively suggested that as Farben was already supreme 
in the chemical industry, it should of course have a dominant posi- 



TREASON'S PEACE 51 

tion in any such arrangement. This sounded plausible, and Teagle 
signified his willingness to let Standard become the junior partner 
provided the minority interest was sufficiently large. Mr. Teagle, 
it would seem, had little confidence in the ability of Standard's 
research men to forge ahead in those new chemical developments 
which were already being discussed in the technical journals as 
certain to arise from the petroleum industry. DuPont and other 
American corporations had already demonstrated that American 
chemical research was amply qualified to compete with the Ger- 
mans. The prewar legend of the supremacy of German chemical 
brains had been punctured. But the Standard leaders seemed 
to ignore this fact. 

Thus, Dr. Bosch cozened his friend Teagle into handing over 
to Farben what amounted to the direction and control of the 
chemical-munitions affairs of the largest industrial organization 
in America. If Mr. Teagle and his colleagues realized what power 
they were giving away they didn't care. If they did not realize it, 
then they were among the few in the chemical industry who were 
not aware of it. 

The result of these negotiations was four new agreements, 
entered into in November 1929 between Standard and Farben, 
which provided for exchange of chemical patents and processes. 
They also covered the commercial exploitation of new products, 
payment of royalties, and the division of world markets. The more 
important of these agreements expressed the intention of the 
parties to cooperate with each other and avoid overlapping and 
competition through a recognition by Standard that Farben had 
a preferred position in chemical products, and a recognition by 
Farben that Standard had a preferred position in oil and natural 
gas. The joker in the agreement provided that such new chemical 
processes contributed by either party, which were not directly 
related to the refining of oil or natural gas, should be controlled 
by Farben. Dr. Bosch thus extended the Farben pattern to a domi- 
nant position in the group of chemical developments which were 
on the way, and which he knew would have a vital bearing on 
the rearming of Germany, and on the national defense of the 
United States. 



5* TREASON'S PEACE 

The relationship established by the 1929 agreements was aptly 
summarized several years later by Mr. Howard in a letter to one 
of his colleagues in which he stated: 

The I. G. may be said to be our general partner in the 
chemical business as to developments arising during the 
period beginning in 1929 and expiring in 1947. The desire 
and intention of both parties is to avoid competing with one 

another The general theory of the agreement is that 

chemical developments more closely related to the oil busi- 
ness than to the outside chemical business remain in control 
of Standard, with I. G. participating whereas develop- 
ments more nearly akin to the outside chemical industry than 
to the then existing business of Standard pass to the control 

of I. G. with suitable participation by Standard One 

additional fact might be pointed out: for a variety of reasons 
it seems quite probable that if we desire to make any addi- 
tional important affiliations in the oil-chemical field, such 
affiliations will be with the duPonts, the Shell Company or 
both. The I. G. relationship is in no respect a handicap but 
on the contrary, a definite asset to us in considering the pos- 
sibility of any such affiliations. 

Standard was courting duPont, as was Farben, but for different 
reasons. Standard's great power lay mainly in one industry oil, 
and the Standard Oil executives were dazzled by the audacity of 
the duPonts, who were then entering one new field after another 
with such brilliant success. 

In 1930 another Standard-Farben agreement was consummated 
which provided for the organization of a jointly owned develop- 
ment company, later established as Jasco Inc., at Baton Rouge, La. 
The name Jasco stood for Joint American Study Company, but 
might well have meant Jackass Americans Surrender a Continent. 
In Jasco, under Standard management, but acting under Farben 
instructions, a group of technicians were to develop new chemical 
processes outside of oil and gas refining. Jasco appeared to be an 
American corporation operated by Americans, and was not iden- 
tified in the public mind with Farben. Actually it became the 
medium through which Farben secured the results of chemical 



TREASON'S PEACE 53 

research done by Standard. Farben in return, furnished Standard 
with a bare minimum of its own research. 

When pressed for more data by Standard, Farben at first pro- 
crastinated with the excuse that its research was incomplete, then 
bluntly stated that the Hitler government would not permit the 
information to leave Germany. In one instance it was revealed 
later than Standard had even supplied data relating to the pro- 
duction of high-test aviation gasoline which Standard research 
had not developed, but which had been secured through an asso- 
ciation with other large oil-refining concerns, including the Anglo- 
Iranian Oil Company, which is controlled by the British Govern- 
ment. Standard was accused of continuing to send these develop- 
ments on aviation gasoline to Farben until November 1939, two 
months after the war between Germany and England had started. 

Synthetic rubber was one of the new products which should 
have been turned over by Farben to Jasco. This development was, 
in fact, the choicest bit of the limburger with which Farben had 
baited its trap. 

Back in 1927 Standard learned that Farben had developed com- 
mercial production of synthetic rubber. Standard also knew that 
duPont was working on synthetic rubber and, in April 1930, before 
the Jasco agreement was signed, a Standard vice-president, E. M. 
Clark, wrote Farben warning them to review their patent situ- 
ation on artificial rubber so that duPont could not get ahead of 
them. 

Farben, in Germany, developed a type of synthetic rubber called 
Buna. Standard, later at Jasco, developed one called Butyl. Buna 
was considered better than Butyl for some purposes, especially for 
tires. Butyl was cheaper to produce and better for other purposes, 
particularly inner tubes. What happened in the jug-handled one- 
way pot called Jasco? Standard, as rapidly as it made progress in 
its Butyl research, supplied all pertinent data to Farben, whereas 
Farben not only delayed supplying the data on Buna but, for a 
period, actually attempted to discourage Standard about its new 
synthetic. "It's not so hot," indicated Farben. "Why bother with 
it? Let's wait until we develop something really worth while." 

At this time, duPont was making rapid strides in the commercial 
production of its own synthetic rubber, Neoprene, which had ex- 



54 TREASON'S PEACE 

cellent qualities but under normal conditions was too expensive to 
compete with natural rubber for making tires. Farben had already 
succeeded in making a number of agreements with duPont on 
exchange of other patents, but duPont was still gun shy; and Far- 
ben wanted Neoprene very badly indeed. So, in 1935 Farben 
notified Standard that they had a proposal from duPont for a 
tie-up on the latter's synthetic rubber. Accordingly, suggested 
Farben, it might be well if a new development company should 
be organized to take care of synthetic rubber research and ex- 
ploitation for all three. One third of the proposed new company 
was to go to Standard, duPont and Farben respectively, and each 
was to put all of its synthetic rubber patents and processes into 
this new pot. Thus Farben tried to play Standard against duPont, 
and duPont against Standard. By suggesting a minority part for 
itself and leaving a two-third interest to the Americans, Farben 
was sugar-coating the syphon through which it hoped to extract 
the desired technical information on this vital synthetic. This pro- 
posal did not go through, possibly because the Messrs. Irenee, 
Lammot and Pierre duPont had a more acute sense of smell than 
had their friends, Messrs. Teagle, Howard and Haslam. 

Farben, however, does not become discouraged easily, and 
some three years later succeeded in getting duPont to grant it 
certain patent licenses to make a Neoprene type of rubber in 
Germany. Meanwhile Farben was building synthetic rubber 
plants for the Hitler Government large enough to supply Ger- 
many's requirements and supplement the reserve stock pile of 
natural rubber which was being imported in anticipation of the 
blockade which would again cut off her outside supply. 

Reports of the success of Germany's synthetic rubber produc- 
tion were discounted by many when Austria was invaded in 1938, 
and stories strangely leaked out of Germany that its motorized 
troops were delayed in getting to Vienna because the new ersatz 
tires blew out. Eventually, a few individuals in our government 
became mildly alarmed at the possibility of losing our natural 
rubber supply, and Standard, responding to pressure, renewed its 
efforts to induce Farben to put the Buna developments into Jasco 
where, under the 1930 agreement, they belonged. 

In 1938 Howard reported to his Executive Committee that Far- 



TREASON'S PEACE 55 

ben continued to decline to supply its data on Buna rubber, since, 
because of military expediency, the German Government refused 
to allow the information to leave Germany. Thus the Farben- 
Hitler military machine clearly showed its teeth. 

As late as October 19, 1939, after the war had started, Howard 
again reported sorrowfully to his Standard colleagues that Buna 
rubber had never been made at Jasco because Farben had not 
supplied the necessary information. A week later Howard ex- 
plained in writing: 

We haven't complete technical information on Buna, and 
cannot get any more information from Germany. The only 
thing we can do is to continue to press for authority to act, 
but in the meantime loyally preserve the restrictions they 
have put on us. 

So, until December 1940, after our Lend-Lease program was 
under way, and Hitler's intentions were clearly defined for the 
whole world to see, Standard loyally continued to preserve the re- 
strictions of the Germans and to transmit to Farben its latest 
research data on this strategic material of national defense. 

Synthetic rubber was by no means the only new research de- 
velopment which came within the provisions of the lopsided m6- 
salliance between Farben and Standard. Farben had discovered a 
process for making acetic acid from natural or cracked gas by 
means of an electric arc. This process tied into synthetic rubber re- 
search, and also produced an acetic acid of superior purity and at 
what promised to be lower cost than resulted from the methods 
then in use. 

Acetic acid, widely used in the industries of peace, is invaluable 
in the manufacture of various chemical , munitions in war. (In 
World War I its price advanced in this country from a few cents 
to more than a dollar a pound. ) This acid was being made by vari- 
ous American companies, but the market was expanding, and 
Standard had ample supplies of both natural and cracked gas. So 
the new Farben method fitted splendidly into the Jasco program of 
joint research and exploitation. . 

A pilot plant was erected at Baton Rouge, and the excellence of 
the process demonstrated. The plant produced acid beyond the 



56 TREASON'S PEACE 

normal requirements of Standard, and it was proposed to sell the 
surplus to various large consumers. Farben, however, was very 
definitely opposed to the commercial production of acetic acid, or 
of any other acetylene products from the electric arc process. Some 
strange reasons were given: Farben had other commitments in 
America which might be interfered with; a disagreeable price war 
might result in Europe; the acetic acid market offered no incentive 
to take up the manufacture of this product, etc, etc. 

When Standard persisted in its desire to enter the acetic-acid 
field, Farben came up with the suggestion that the acid sales be 
handled, not by Jasco or Standard, but through Advance Solvents 
& Chemical Corp., with which Farben had other ties. This plan 
fell through, however, as did a later effort to interest the Shell Oil 
Co., the American subsidiary of the Dutch Shell interests. Farben 
then informed Standard that it was developing improvements in 
the original acetylene process but that the German Government 
would have to approve any contracts relating to it. Finally, Farben 
threw all pretense aside and requested that the Jasco acetic acid 
plant be abandoned. This was done. Standard dismantled the 
plant. In 1940 the patents covering the acetic acid process were 
transferred by Farben to its own subsidiary General Aniline & Film 
Corp., which at the time was engaged in a furious campaign to 
convince the American public and the U. S. Government that it 
was not controlled by Farben. 

Another product which was turned in to Jasco for development 
was a laboratory curiosity called Oppanol. Oppanol had not been 
considered previously as a basis for compounding lubricants, but 
through Jasco research it was found to have great value in the 
production of a superior lubricating oil for planes, tanks and naval 
vessels. These developments, invaluable in war, and wholly the 
result of research by Standard technicians, were promptly handed 
over to Farben and thus became available for the German war 
machine. Other processes and products which were worked on by 
Jasco, became the mediums through which numerous American 
companies were brought within the Farben orbit. Through the 
kindly offices of Standard Oil, the intelligence department of Far- 
ben was thus enabled to peek into technical minds, and enter door- 
ways that would not otherwise have been open to it. 



TREASON'S PEACE 57 

When the present war started, Standard and Farben entered 
into a new series of agreements, some of which, by their wording, 
were undoubtedly intended for carry-over understandings, effec- 
tive for the duration and until such time as the old agreements 
could be reinstated and "business as usual" resumed. While Hit- 
ler's army was on its way to Warsaw, Standard's Mr. Howard was 
on his way to Europe to meet a Farben representative. This meet- 
ing resulted in what came to be known as the Hague Agreement 
a most interesting document which was signed by Mr. Howard for 
Standard, and by Dr. Fritz Ringer for Farben, on Sept. 25, 1939, 
two days after the German Army announced its victorious destruc- 
tion of Poland's resistance. Messrs Howard and Ringer, however, 
dated the document back a few weeks to September first, feeling 
perhaps, that it would read a bit better as a peacetime under- 
standing. 

By the Hague Agreement Farben purported to transfer to 
Standard all of its rights in Jasco in consideration of a small cash 
payment which was to be paid to a Farben designee. A division 
of market rights on the products was also included. Standard to 
have the United States, the British and French Empires and Iraq, 
Farben to retain the rest of the world. Then came carry-over pro- 
visions which obligated Standard and Farben to report to each 
other on all future business in their respective territories, with the 
understanding that if there should be inequities in the monetary 
returns, adjustments would be made on the basis of the original 
agreements of 1930. War or no war, the Standard-Farben alliance 
was to go on. 

Mr. Howard reported to his colleagues that this agreement was a 
modus Vivendi which would operate for the duration "whether 
or not the U.S. came in." The report continued with: 

It is hoped that enough has been done to permit closing 
the most important uncompleted points by cable. It is difficult 
to visualize as yet just how successful we shall be in maintain- 
ing our relations through this period without personal con- 
tacts. 

In making this report, Mr. Howard may have had in mind the 



58 TREASON'S PEACE 

fact that the Trading with the Enemy Act, passed during the first 
World War, had never been repealed. 

Despite Mr. Howard's anticipated suspension of communica- 
tions, in June 1940, Standard asked Chemnyco, Inc., Farben's New 
York headquarters, for a license and transfer of title on a patent on 
an asphalt process, with a provision for retransfer of title under 
suitable conditions. And, six months later, Farben suggested an 
understanding through which it would sell on a royalty basis cer- 
tain products for Standard in countries the latter could not reach. 
Meanwhile on Sept. 4, 1940, Standard's executive committee rati- 
fied a brand-new arrangement, covering payment of royalties on 
hydrogenation patents with Farben, which was dated back to Janu- 
ary 1, and in which some provision of the original 1929 agreements 
were either reaffirmed or modified. 

After the fall of France, Farben kept in touch with Standard by 
meeting the latter's representative in Paris. And, in February 1941, 
a message from the French capital informed Mr. Howard that his 
friend Dr. Ringer wished to reply to a question raised by a cable 
with the advice that: 

Jasco cable will be difficult but one underlying point is that 
Jasco contract has not been wiped out as agreed whatever 
done the final financial outcome original intention of old Jasco 
agreement should govern. 

The exchange of information continued until a few weeks before 
Germany declared war upon the United States. On Oct. 22, 1941 a 
cable went to Farben advising that Jasco had filed suit against the 
B. F. Goodrich Rubber Co. for alleged infringements of patents 
covering Buna. The cable also asked Farben to send copies of the 
German patent applications which should be duly certified by a 
United States Consul. Again, war or no war business as usual. 

In addition to Messrs. Teagle, Howard, Haslam and Clark, 
among those most actively concerned in the later negotiations with 
Farben was the late W. S. Farish, who came into the Standard 
organization in 1919 when that company purchased control of the 
Humble Oil Co., of Houston, Texas. Farish had organized the 
Humble Co. a few years previously with several men who were high 
in^Texas political affairs. In 1933 Farish became chairman of Stand- 



TREASON'S PEACE 59 

ard, and in 1937 he succeeded Teagle as president. Another Stand- 
ard stalwart was Dr. Per K. Frolich, director of their chemical 
laboratories. Dr. Frolich, in 1942, was elected president of the 
American Chemical Society. 

Mention has already been made of the kindly intercession of Mr. 
Teagle in bringing about a friendly conference between Dr. Bosch 
and Lammot duPont. Previous meetings had not run too smoothly, 
as indicated by the 1929 conference at which Lammot duPont chal- 
lenged Dr. Bosch about the report that Farben and Standard Oil 
planned a joint synthetic nitrogen plant in Louisiana. Dr. Bosch 
replied that the report was true and that a company had already 
been formed in which Farben held fifty-one percent of the stock. 
This, of course, was entirely untrue. The 1929 agreements between 
Farben and Standard had not been signed at that time, and the 
stock interest of which Bosch bragged was not in those agreements. 
Apparently Farben was bluffing and had no intention of building 
a synthetic plant here in its own name or at its own financial risk. 
Why invest in a horse and buggy if someone else could be in- 
duced to furnish a free ride? What Farben was after was to hold 
the reins, no matter who owned the steed. 

Synthetic nitrogen was the personal baby of Dr. Bosch, and Far- 
ben's annual production of 600,000 tons was one-third of the 
world's consumption. So the good doctor was fully aware how great 
had been the loss to Farben when, in 1918, the Haber-Bosch patents 
for the production of the synthetic nitrogen were seized by the 
Alien Property Custodian. Prior to the war, an unsuccessful attempt 
had been made in the United States to produce nitrogen commer- 
cially by atmospheric fixation, and while the war was in progress a 
huge nitrogen plant was started with government aid at Muscle 
Shoals, Alabama too late for the war effort. 

However in the postwar decade atmospheric fixation had begun 
in the United States and with this background and the prospect 
of a large American production of synthetic nitrogen and am- 
monia, Farben did not relish the thought of new American plants 
which might serve as munition factories in the next war. As al- 
ways, Farben was looking to the future, and the importance with 
which its leaders regarded a participation in the production of 
these synthetics in the United States has been amply justified by 



60 TREASON'SPEACE 

the tremendously increased use of high explosives in the present 
war. Their use has dwarfed all earlier needs for nitrates and am- 
monia; an example were the huge two and four-ton "Block Bus- 
ters" charged with amatol, a new high explosive which is made 
by compounding TNT with ammonium nitrate. Yes, Farben knew 
what was coming. 

Eight years after the friendly conference arranged by Mr. 
Teagle, Farben caused the formation of the International Nitro- 
gen Association, a world cartel, which brought into unity of action 
the producers of both natural and synthetic nitrogen and am- 
monia. Ostensibly this cartel was to rule the markets for fertilizer 
materials. Actually, the far more important objective was to limit 
the capacity of synthetic nitrogen plants outside of Germany. 

Farben went far around Robin Hood's barn to secure some sort 
of nitrogen and ammonia tie-ups in this country, and to bring 
duPont within its sphere of influence on these important synthetic 
war munitions. DuPont's main interest in synthetic nitrogen and 
ammonia in the decade after World War I was for the explosives 
department of its business. Fundamentally duPont has been a 
producer of gun-cotton rather than fertilizer. 

In January 1926 duPont entered into a rather illusive agreement 
on explosive patents and processes with Dynamit A.G., which 
later became a Farben subsidiary in that field. The agreement that 
was drawn up was not signed, but was held as a gentlemen's un- 
derstanding. It covered ammunition of various sorts, industrial 
explosives, and the countries in which licenses under the patents 
should be granted. It did not however, mention military explo- 
sives as such. Dynamit A.G. was also a manufacturer of celluloid, 
which is made from nitre-cellulose, and another informal agree- 
ment was reached by which duPont and D.A.G. would exchange 
information and give each other the first option on rights to patents 
and processes. These two casual understandings are significant 
because, apparently, they were the first through which duPont be- 
came allied with Farben. 

A later tie-up which was to have wartime repercussions was 
made in 1929 between Dynamit A.G. and the duPont-owned Rem- 
ington Arms Co., by which information was exchanged and roy- 
alties paid by Remington on a patented chemical product of 



TREASON'S PEACE 61 

German invention known as Tetrazine, a substance of great value 
as a priming charge for ammunition. This agreement stipulated 
that Remington could not sell military ammunition containing 
Tetrazine in any of the countries comprising the British Empire. 
When war began in 1939, Remington received huge orders for 
ammunition from the British Government, but because of the 
clause in the contract with the Farben subsidiary, it had to supply 
the British with cartridges containing an inferior priming agent. 
This restriction continued in 1941. Later it was rescinded. Only, a 
tiny speck of the primer is required in each cartridge, but the 
efficacy of that small particle might well mean the life or death 
of a soldier. 

Returning for a moment to the period immediately following 
the Armistice, we find that the great chemical plants that had 
mushroomed up in the United States during the war presented 
a big reconstruction problem. Clearly, it was up to the industry 
to evolve new peace-time products, and in this effort the duPont 
chemists outstripped all other American research workers. The 
war plants which gave the impetus to this research were largely 
in the organic chemical field based upon the conversion of coal 
tar or other once-living organisms as distinguished from inorganic 
materials such as sulphur, sodium and other metallic elements. 

Among the most important developments of this post-war re- 
search were various types of synthetic resins or plastics made by 
what is known as polymerization. This may be described briefly 
as a method of changing liquids into solids through application 
of heat, light or the use of catalysts. Chemically, polymerization 
is the combination of a number of molecules to form a single new 
and larger molecule. The number of new materials in which these 
rearranged molecules may be formed is endless. It might almost 
be said that the chemist, having unscrambled matter down to 
what seemed to be its smallest particles, the physicist then stepped 
in to rebuild it into heretofore unsuspected forms. Thus such ele- 
ments as oxygen, hydrogen, nitrogen, carbon and chlorine, all ob- 
tained from inexpensive raw materials, are formed into solids of 
surpassing beauty that for many constructive uses are unequalled 
in nature. Unhappily, however, these new substances supply some 
of the most important implements of war. 



6 TREASON'S PEACE 

Among these postwar products in which duPont research kept 
so far ahead of its competitors in the United States and at least 
abreast of Farben's technicians were Neoprene, Nylon and the 
glass-like product called Lucite. This last was an evolution of the 
laminated safety glass, designed primarily for automobile wind- 
shields. Lucite proved to be a most superior product. It was far 
stronger than glass, was practically shatterproof, and provided 
equally good visibility. 

DuPont's commercial production of Lucite began in 1935. It 
had been preceded by the production of a somewhat similar plas- 
tic known as Plexiglass produced in Germany by the firm of Rohm 
& Haas A. G., Darmstadt; and in the United States by a company 
of a very similar name, Rohm & Haas Co., Inc., of Philadelphia. 
Years before, when the firm was founded, Dr. Rohm was the 
German and Mr. Haas the American partner. During World War 
I the American Rohm & Haas had been seized by the Alien Property 
Custodian because of an alleged sixty per cent enemy interest. 
The enemy interest was sold by the Custodian to a Chicago con- 
cern which promptly sold it back to the American Rohm & Haas 
company. A forty per cent interest in the American company was 
then trusteed so that the dividends would go to Dr. Rohm and his 
family in Germany. Thus the partners lost no time in circumvent- 
ing the seizure by the United States Government. 

In 1927 there began a series of agreements between the Ameri- 
can and the German Rohm & Haas companies, and between the 
latter and I. G. Farben. These agreements related to new develop- 
ments in sheet plastics. In this same period duPont and the English 
Imperial Chemicals Industries were cooperating in similar plastic 
developments. Conflict over patents arose between these two 
groups. Finally, in March 1936, after protracted negotiations, 
duPont and the American Rohm & Haas agreed on an exchange of 
patents and processes, which arrangement tied in with Imperial 
Chemicals and the German Rohm & Haas, and thus with Farben. 

Three years later, just a few months before World War II 
started, the two American makers of plastic glass entered into 
several more understandings which provided for control of prices, 
market sharing and restriction of production. Also, restrictions on 
the sale of the plastics abroad were entered into by the American 
Rohm & Haas with its German namesake and with Farben. 



TREASON'SPEACE 63 

By this time the use of plastics for airplane enclosures and 
gunners' screens had become of vital importance. And a result 
of the limitation of production was said to be a shortage of these 
sheets of plastic for the construction of military airplanes and 
other military equipment scheduled for the Lend-Lease program, 
and the long-delayed United States national defense program. 
Farben strategy, again by the indirect approach, had succeeded. 

The relationship between the American Rohm & Haas and 
Farben is illustrated by correspondence between them after the 
war had started. Farben, in December 1939, wrote to the Phila- 
delphia company releasing it from restrictions on the exportation 
of certain of its products, and requesting it to take care of Farben's 
customers in Latin America orders from whom would be referred 
to Rohm & Haas through another of Farben's allies in the United 
States, Advance Solvents & Chemical Co. Mr. Haas replied on Jan- 
uary 22, 1940, that his firm would of course comply with Farben's 
request, also that: 

No matter who is doing the shipping we shall revert to the 
status quo antem as soon as normal conditions have been 
restored. The thought uppermost in my mind is to serve you 
in the most faithful and most efficient way possible in this 
emergency. 

Otto Haas, an American citizen for many years, was not only 
faithful to Farben in the emergency of war, but appeared confi- 
dent that when the war should end he and his supposedly Ameri- 
can firm would be permitted to resume their relations with Far- 
ben and that Farben would again rule the roost as before. 

In October, 1935, two of Farben's leading officials, Georg von 
Schnitzler and Dr. Fritz ter Meer, came to Wilmington and at- 
tended a meeting at the home of Lammot duPont. At this meeting 
Farben's representatives pointed out how friendly Farben's atti- 
tude had been in cooperating with duPont on the amicable settle- 
ment of patent disputes and foreign market problems and that 
Farben had invited duPont participation in the synthetic rubber 
developments. Yet duPont, according to the Farben report of this 
meeting, remained apprehensive that Standard Oil, by reason of 
its Farben tie-ups, might break into duPont's field in the chemical 
industry. 



64 TREASON'S PEACE 

DuPont's ideas on the subject of its relations with Farben are 
recorded in a memorandum dated March 18, 1936, in which was 
stated: 

"The duPont-I. G. relationships have notably improved, due 
partly to the personalities of individuals entrusted with nego- 
tiations, and partly to an officially more friendly attitude from 
higher up in the I. G. organization." 

This memorandum also indicated that patent disputes were 
being settled very satisfactorily, especially those handled by Dr. 
George Lutz, an expert employed by duPont, who formerly had 
been associated with I. G. Dyes. The memorandum further sug- 
gested that the relations with Farben which did not seem to stand 
so well were on artificial silk and cellophane. However, on May 
23rd, 1939, Farben finally induced duPont to sign an agreement 
which covered Nylon. 

Artificial silk has had its place in the list of chemical-munition 
products since the first World War, when its value was demon- 
strated for powder bags, electric insulation, and other military 
requirements. More recently the use of different types of rayon as 
a substitute for cotton in heavy-duty airplane and auto tires, and 
to replace silk for parachutes, had placed these synthetic textile 
fibers definitely among the more important chemical munitions. 
These qualities, plus the adaptability of some of the chemical 
processes involved in rayon production to other war materials and 
the rapid advance of technical developments, made it important to 
the Farben strategy to add this industry to the list of those in the 
United States to be penetrated, and handicapped for war. 

Farben first reached into the United States photographic field 
in 1926, shortly after it succeeded I. G. Dyes. At that time William 
E. Weiss of Sterling Products wanted Farben to turn over to him 
the American development of the photographic interests of Kalle, 
which owned the German Agfa, and was already in a strong posi- 
tion in Germany. Farben refused Weiss's request, and proceeded to 
purchase complete control of the Ansco Photo Products, Inc., of 
Binghamton, N. Y., the oldest maker of photo supplies in America. 

Farben also organized Agfa Raw Film Corp., and Agfa Photo 
Products, of New York City. Then, in 1928, it combined all these 



TREASON'S PEACE 65 

interests in the Agfa Ansco Corp. Ten years later Agfa Ansco had 
become the second largest concern of its kind in the United States. 
Its importance as a supplier of materials for war requirements, 
especially for aerial photographic maps and for blueprinting war 
plants and equipment, made this Farben-owned company a poten- 
tial menace to the national defense of this country. 

We now come to a phase of Farben's strategy which reached out 
into metallurgy rather than chemistry, although its inception came 
from the chemical process by which metallic magnesium is recov- 
ered from solutions of brine. Farben's early development of large- 
scale magnesium production and the light metal alloys into which 
this metal is combined, constituted a most important contribu- 
tion to the German war machine incendiary bombs and airplane 
metals. 

As already mentioned (in Chapter n), Dr. Schweitzer, World 
War spy and head of the American Bayer Company, had boasted 
of the day when his colleagues' development of magnesium alloys 
would be of great value to the Fatherland. It was. Germany made 
great strides in the first postwar decade in producing the metal 
and its alloys, and in making castings of the latter. 

In this same period the Dow Chemical Co., and the American 
Magnesium Co., began to produce metallic magnesium in the 
United States. The Aluminum Co. of America ( Alcoa ), then took 
over the American Magnesium Corp., and shut off its production 
of the metal, leaving Dow the sole American producer. In 1927 
Alcoa made a cross-licensing arrangement on alloys owned respec- 
tively by Dow and American Magnesium, and also secured licenses 
to United States patents on magnesium owned by British Alum- 
inium Co. 

Farben had been biding its time. It had taken out various United 
States patents which were of no great value on the production of 
the metal, but which did have some advantages in its fabrication. 
Then, in 1929 Farben made advances to both Dow and Alcoa 
for partnership arrangements covering the entire magnesium field- 
production, alloys and fabrication. Dow repulsed these advances 
and refused even to discuss any partnership with the Germans. 

Possibly they recalled an experience twenty-five years earlier, 
when a visitor from Germany came to Midland, Michigan, and 
warned the senior Dow that if his firm did not discontinue export- 



66 TREASON'SPEACE 

ing bromine, the Germans would retaliate by dumping two pounds 
of bromine in the United States for every one that Dow exported. 

Dow had defied those early threats, and the Germans dumped 
their bromine in this country at less than the cost of transporta- 
tion and duty. This vicious commercial blackjacking continued to 
handicap Dow's business until war broke out in 1914, but Dow 
had not yielded to the Germans then, and did not intend to do 
so on magnesium. 

However, Dow failed to reckon with the power of the new Far- 
ben strategy which tied up Alcoa as its partner in 1931, and a year 
later organized the Magnesium Development Co. Under joint 
ownership, but with Farben's Dr. Walter H. Duisberg as presi- 
dent, the new company pooled all the magnesium patents and 
developments of Farben and Alcoa, and notice was served on Dow 
to play ball or else. 

Dow held what appeared to be trump cards in development of 
processes, valuable patents and contracts with Ford and other auto- 
mobile companies. But the heat was on, and threats of patent litiga- 
tion were made. One suit was actually started. 

A gentler approach was through a series of luncheons at which 
one Edward L. Cheyney, suave Alcoa sales executive, entertained 
an aged director of the Dow company at the gloomy Union Club 
in Cleveland and, between courses, pictured the doleful things that 
could happen to a company that persisted in bucking the Farben- 
Alcoa combine. No threats were made but the deep regret of 
Alcoa was expressed at the unfortunate obstinacy of the Dow man- 
agement. The luncheons were held on direct instructions from 
Farben, but Mr. Cheyney soft-pedaled the Germans' place in the 
setup, and emphasized the probity of Alcoa. Dow finally decided 
that further resistance was useless, gave up the unequal contest 
and, in 1933, signed up with the Farben-Alcoa magnesium 
team. 

During this triumph of the Farben strategy in breaking into 
another American industry on the traditional German shoestring, 
its emissaries were negotiating with the Ford Motor Company on 
the fabrication of magnesium alloys for piston heads and other 
automotive parts where light weight was an advantage. Quite 
possibly these negotiations traced back to the Ford Motor Com- 
pany's plant in Germany, and may also have had bearing on the 



'TREASON'S PEACE 67 

willingness of Mr. Edsel Ford to act as one of the directors of the 
American I. G. Chemical Corp. to which Farben's fifty per cent 
interest in the Magnesium Development Corp. was assigned. 

However, once Dow was securely tied into the Farben-Alcoa 
combine, Farben's next step was to make sure that the production 
of magnesium metal in the United States be restricted, and its 
fabrication in alloys be developed as slowly as possible. This was 
important, because magnesium, in its natural form, is one of the 
most plentiful of the elements, and so many new methods of ex- 
tracting it had been experimented with, and so many new uses 
were in sight that there were good prospects of lower costs for 
the metal and the consequent rapid expansion of its production. 

In its first 1931 agreement with Farben, Alcoa had accepted a 
restriction on initial production of the metal should a new United 
States plant be built by the partners. When Dow signed up, the 
plans for a new plant were at once abandoned, and competition in 
the domestic magnesium industry was at an end. Farben mean- 
while had greatly expanded its own production of magnesium and 
magnesium alloys in Germany. With one hand Farben prepared 
Germany for war by creating a sufficient supply of light metal for 
its huge fleet of warplanes; with the other it throttled the growth 
of the industry in America, and saw to it that a good part of the 
limited United States production was shipped out of the country. 

Thus Farben inoculated our magnesium producers with indus- 
trial sleeping-sickness, which the larger of its partners, interested 
mainly in aluminum, did not resent, and which the other partner, 
shanghaied into a shotgun Farben marriage, was unable to pre- 
vent. When the United States started its schedule of expanded 
airplane production, one of the greatest, and seemingly insur- 
mountable barriers which confronted the Army and Navy was the 
acute shortage of magnesium alloys. 

Other metals of vital importance to national defense which are 
found in restrictive agreements involving American producers with 
Farben, directly or indirectly, included aluminum, nickel and 
molybdenum. 

Contrary to opinion so frequently expressed elsewhere, it was 
merely incidental to the Farben strategy (as illustrated in this 
chapter and that preceding it) that the cartel mechanism lent 
itself to Farben's purpose in tying into some of the great industrial 



68 TREASON'S PEACE 

corporations of this country. The almost complete abandonment of 
anti-trust law enforcement had made many of these American 
combinations inevitable and likewise made Farben's technic pos- 
sible. This technic would have been ineffective and Farben's task 
much more difficult if the anti-trust laws had been enforced. 
Farben's part in procuring two decades of lax enforcement of fed- 
eral statutes may best be understood after reading other chapters 
of this story. 

When the war started in 1939 Farben's tie-ups in the United 
States were by no means confined to the particular products and 
companies which have been mentioned thus far. The thousands 
of United States patents taken out during the preceding seventeen 
years by Farben and its affiliates in Germany had been utilized to 
effect an almost countless number of agreements with corporations 
and individuals in the United States. These agreements ranged 
from royalty payments on products of relative unimportance to 
complete control of militarily-strategic industries. The greatest 
number of these patents related to coal-tar dyes and pharmaceu- 
ticals; others involved a wide range of chemical and metallurgical 
products. 

It is proper to state that the mere fact that each of those many 
companies had relations of some sort with Farben or its affiliates, 
does not necessarily imply any degree of illegality on the part 
of each such American company. Farben's broad purpose was 
to accomplish so complete a saturation of our industrial struc- 
ture, by fair means or foul, that our progress at all times would be 
under observation, and, when advisable, might be restricted. 

As we have seen, some of its contracts were viciously illegal. 
Other arrangements however were not tainted with illegality. 

An indication of the extent and diversification of this penetration 
is a partial list, in the appendix, of some of the better-known Ameri- 
can corporations, including those already mentioned, which are 
officially reported to have made agreements with Farben or to 
have been involved in some of Farben's direct tie-ups with other 
companies. This list reads like a directory of American industry. 
Because of the character of these agreements and relationships, at 
least some degree of Farben's influence or espionage may have 
resulted in each instance. 



CHAPTER V 



Farben's Royal Family 



LIKE MOST 

great industrial corporations, I. G. Farben has a royal family 
the original members of which created its pattern and formed its 
corporate policy. 

Leading members of the Farben royalty are Dr. Hermann 
Schmitz, perhaps the most dangerous of Germany's living war 
criminals, and the late Doctors Karl Duisberg and Karl Bosch. 

These three gentlemen, their relatives, and their associates ap- 
pear from time to time in other chapters of this story. But the 
plan to plant their offspring in our midst plays so important a part 
in the Farben pattern that the individual profiles gathered here 
may appear of value. 

Dr. Hermann Schmitz, by sheer brain power and complete ruth- 
lessness, came up the hard way from his boyhood commercial 
school in the iron city of Essen and a bank clerk's training. Then 
World War I shoved him into the Dye Trust Badische nitrogen 
affairs as a staff member of the Kaiser's war machine. 

Entering the Badische management in 1919 Dr. Schmitz was an 
Executive Committee Managing Director of Farben from its be- 
ginning in 1926 became chairman in 1938, and also was Farben's 

69 



70 TREASON'S PEACE 

director on the board of Fritz Thyssen's Vereinigte Stahlwerke from 
the time the Steel Trust was tied in with Farben in 1926. Active in 
politics from the early days of the Weimar Republic, Schmitz 
made personal contributions to the Nazis, was a member of Hitler's 
puppet Reichstag, and War Economy Chief before and during 
World War II. 

This elder statesman of the Schmitz family did not emigrate to 
America to become a citizen but he commuted regularly during 
the years when, as shown elsewhere, he personally directed Far- 
ben's American subsidiaries and consummated many of Farben's 
most important partnerships and illegal tie-ups in this country. He 
enjoyed intimate friendships with top men in American industry 
and finance. Dr. Schmitz created the Swiss I. G. Chemie as a hide- 
out for Farben's false fronts abroad and installed his brother-in- 
law, Albert Gadow, as its resident manager, with instructions to 
acquire Swiss citizenship. 

Dr. Schmitz was also a Director of the great Deutsche Reichs- 
bank and of the Bank of International Settlements, that financial 
catch-all for cartel members at war, with its headquarters in 
Switzerland where Schmitz throughout the war was able to main- 
tain direct contact with its American president, Thomas H. Mc- 
Kittrick, and with various cartel associates, to put out peace 
feelers after his criminal gang finally decided that Farben should 
call for an intermission before another war. 

In his various capacities in finance, industry and government, 
corruptionist in each, and as chairman of the American I. G., 
the Swiss I. G., and the German I. G., Schmitz appears as a triple 
threat, one of the most vicious and dangerous of Germany's war 
criminals. Frequently addressed as Geheimrat (Privy-Councillor), 
the doctor was also entitled to be called Justizrat as a doctor of 
laws (honoris causa). 

On his many visits to this country Dr. Schmitz personally took 
an active part in directing Farben's American subsidiaries as a 
result of which activities he won top honors in having been indicted 
on three separate occasions as Farben leader and organizer or 
head of General Aniline. The Justizrat was also named as co- 
conspirator in two other criminal cases. His three indictments re- 
main untried as this is written, also one of those in which he was 



TREASON'S PEACE 71 

called a co-conspirator, and the other was abandoned by a com- 
placent Attorney General. 

In July 1945, while being examined at Frankfurt by the United 
States Army, Schmitz admitted that he had tried to persuade Hitler 
to use a new and very deadly Farben war gas on the Allied Armies. 
Then, a few weeks later, the good doctor publicly proclaimed his 
ambition to become Germany's representative on the Security 
Council of the United Nations. This from the man who is credited 
with having developed the plan of making I. G. Farben a vast 
international espionage machine cloaked under cover of indus- 
trial and commercial activities and the most important part of 
this vicious design was the Schmitz proposal that trustworthy 
members of the Farben families emigrate to other countries, espe- 
cially to the United States, to serve the Fatherland's Farben in 
peace and in war. 

Dr. Karl Duisberg, who died in 1935, was known, and deserv- 
edly, as the father of German industrial chemistry. Holding high 
office in the first World War, it was he, as founder of the American 
Bayer Company, who sent Hugo Schweitzer to this country to 
become Bayer's chief chemist in public, and Germany's espionage 
and pay-off man in private. Dr. Duisberg was also leader of the 
I. G. Dyes plan of postwar strategy, and personally negotiated 
the first of its new tie-ups with Sterling by which control over 
American Bayer was reasserted. His secretary, one H. Gattineau, 
like his son-in-law, Max Ilgner, is said to have been a main Farben 
connecting link with the Hitler Government after the Nazis came 
to full power in 1933. 

Duisberg probably more than any of his colleagues epitomizes 
the vicious union of applied science and industrial productive 
brains which in itself is the core of Farben's potential for world 
conquest. 

A young relative of Karl Duisberg (through his wife, who was 
Johanna Seebohm) appears in the notorious Hermann C. A. 
Seebohm, who had come to America before World War I and 
gotten kicked out. He was a director and Secretary of the Ameri- 
can Bayer Company, involved in the World War I espionage and 
crooked business of this Dye Trust false front by which sabotage 



72 TREASON'S PEACE 

in North and South America was financed and the company was 
milked of its assets. So Mr. Seebohm was arrested and interned 
in 1918, later to be shipped back where he came from, to turn 
up as a Managing Director of Farben, and after the rape of Austria, 
as chairman of one of the Farben subsidiaries in that unhappy 
country. 

Dr. Duisberg had two sons, Karl Ludwig and Walter H. He 
kept Karl at home to serve on the Farben boards, and Walter H. 
was sent overseas to join the Farben colony in America. Another 
Duisberg, of uncertain relationship, turned up in Frankfurt in 
1945 after the American Army seized Farben's headquarters 
there, and was quoted in news dispatches as saying that "German 
industry can make a quick recovery after the war if the Allies .will 
be so kind as to permit it so to do." 

Dr. Karl Bosch, winner of the Nobel Prize, with Fritz Haber, 
for invention of the first synthetic ammonia nitrogen process by 
which Badische made it possible for the Kaiser to launch his war; 
and inventor of war gases introduced by the Kaiser's armies, be- 
came the first chairman of Farben's board of managing directors. 
After the death of Duisberg, Dr. Bosch shifted to chairman of its 
supervising board until he died in 1940. 

Bosch, like Duisberg, sought only one thing world conquest 
through perverting science. This criminal of two world wars had 
a son, Dr. Karl Bosch, Jr., whom he trained with great care and 
affection to carry on for Farben. He also had a brother, Robert, 
of Bosch Magneto fame who also appears elsewhere in this story 
and whose American subsidiary, like several of those of brother 
Karl, had the dubious distinction of being seized by the Alien 
Property Custodian, during both world wars. 

This criminal of two World Wars had a magnificent estate near 
Heidelberg, where he royally entertained his American partners 
on their frequent visits to Germany. In his gentler moments of 
relaxation when not planning treachery, aggressive war, or mass 
murder, Dr. Bosch enjoyed displaying his collections of crystal 
and of beetles and butterfies, said to be the best in Germany. 

Another royal family of Farben, from the earlier days of the 



TREASON'S PEACE 75 

I. G. Dyes cartel, was headed by two Frankfurt aristocrats and 
Junkers, Dr. Walther vom Rath and Dr. Wilhelm von Meister, who 
prior to the formation of Farben in 1926, had been controlling 
and interrelated figures in Farbwerke vorm. Meister Lucius & 
Briining, the great Hoechst firm in which members of the Meister 
family, from its foundation, had played important parts. So they 
sent their sons to America. 

The senior vom Rath had a nephew, Georg von Schnitzler, who 
stayed at the royal court to rise high in the Farben dynasty. 
Von Schnitzler was a brother-in-law of the famous, or notorious, 
General Fedor von Bock who led the Nazi armies to defeat in 
Russia, got back with a whole skin, to be shot down by the British 
near Hamburg as the war was ending in 1945. 

Georg von Schnitzler, as a managing director of Farben, be- 
came one of its most powerful rulers, he was a heavy financial 
contributor to Hitler's rise from the gutter, and in his handling 
of Farben's foreign tie-ups, camouflage and espionage, he appears 
as among a half dozen of the most dangerous of Germany's war 
criminals. 

In 1943 von Schnitzler, knowing the war was lost, established 
a residence in Madrid a veritable castle in Spain where he could 
keep and renew his close friendships and carry over alliances 
with leading American cartelists, to begin the repair of Farben's 
war-damaged foreign empire and preparations for World War III. 
So in 1945 this Farben Junker was back in Germany for the finish, 
and became the most notable and possibly the most informative 
of the Farben family in giving up secrets and conclusions about 
Farben's war activities. 

Among the statements in his voluminous "true confessions" one 
ended with: "Thus I conclude that I. G. Farben is largely respon- 
sible for Hitler's policy." 

Georg von Schnitzler's daughter Lilo, celebrated as a beauty 
and an early friend of Adolf Hitler when the latter was emerg- 
ing, was married to one Herbert Scholz, an erstwhile friend of the 
lamented Ernst Rohm before that degenerate pal of Hitler was 
bumped off by his ungrateful boss. So Mr. and Mrs. Herbert Scholz, 
as an effective team were shipped off to American to help along 
Farben's cause of world conquest 



74 TREASON'S PEACE 

Not to a Farben hideout, but to Washington came Georg von 
Schnitzler's Lilo and her Albert; sinister beauty teamed with 
vicious brain, that historic combination for diplomatic intrigue. 
Mr. Scholz, as secretary to the German Ambassador, dominated 
his official master, while Lilo played her dazzling part among 
influential members of high society in the nation's capital. 

As she had charmed and helped to train to Farben's social 
graces the unspeakable Adolf, so were those charms displayed 
and used to beguile democracy's chosen rulers to do those things 
that Farben's royalty desired. Lilo and Albert then moved on to 
conquer Boston, Massachusetts, where that precious scion of 
Farben, officially the German Consul, carried on in secret as a 
No. 1 Gestapo pay-off man, until June 1941, when he was grabbed 
by the F.B.I., to be kicked out of the country with the rest of 
the official Nazi brood. The full story of what Lilo and her Albert 
did in Washington and in Boston in the period after the war had 
begun in Europe must remain untold, still concealed in official 
files for some strange reason. 

So now we come to a few highlights in the activities of some of 
the younger members of the Farben dynasty relatives who were 
sent over here, not as visitors but as permanent residents. Usually 
they became American citizens without delay, they married, estab- 
lished homes in suburban districts where social ties could readily 
be formed, and they made the right kind of professional and 
political contacts. 

As reputable, well-to-do business men these Teutonic termites 
added strength and respectability to Farben's new American 
fronts, and, in anticipation of the war that was to come, their 
cloak of citizenship was designed to prevent such unhappy inci- 
dents of the past as internment and property seizure. They com- 
posed the field staff of Farben's industrial pincers in America; 
they received and carried out orders from headquarters, and 
directed the accumulation of funds and information, much of 
which somehow found its way back to Germany. 

Among the Farben delegates to this country were William H. 
vom Rath and F. Wilhelm von Meister. Here they held important 



TREASON'S PEACE 75 

positions in Farben's American subsidiary, General Aniline & Film 
Corporation. 

William H. vom Rath, son of Walther, and cousin of Georg von 
Schnitzler, was also a cousin of Ernst vom Rath, Secretary of the 
Germany Embassy in Paris, who was assassinated in 1938 by the 
young Pole, Herschel Grynszpan. During World War I, Wilhelm 
was involved in the direction of the German Secret Service at 
Geneva, Switzerland. 

Wilhelm came to the United States in the early 20s and after 
a few years was naturalized as William H. vom Rath. The "Wil- 
helm" was no more. In 1929, he received his first real Farben re- 
sponsibility, he was elected Secretary and made a director of the 
newly organized American I. G. Chemical Corp. 

Young vom Rath bought a fine home at Glen Cove, Long Island, 
and made many influential friends. Some of his activities in Far- 
ben's interest will be mentioned later on in this story. It is suf- 
ficient here to relate that in December 1941, William H. vom Rath, 
was indicted for conspiracy to violate the anti-trust laws, along 
with other Farben agents and corporate subsidiaries. As this is 
written the indictment has not been tried, nor is there apparently 
any prospect of its being tried. Until Germany threw up the sponge 
the official excuse was given that to try Mr. vom Rath ( and some 
of his royal pals ) would interfere with our prosecution of the war. 

F. Wilhelm von Meister, son of Wilhelm, Sr., and also cousin 
of Georg von Schnitzler, came to this country to become vice- 
president of Farben's photo paper subsidiary, Ozalid Corpora- 
tion, when it was ostensibly owned by Chemnyco. In 1940, when 
Ozalid became a part of General Aniline, von Meister was made 
manager, where he remained until kicked out by the Treasury 
Department after being indicted in December 1941 along with 
vom Rath and other members of the royal family. 

American citizen von Meister is as yet among those sons and 
brothers of Farben accused of criminal acts who remain untried. 

Dietrich A. Schmitz, brother of the regal Hermann, did many 
odd jobs for Farben in this country and in Latin America, but 
two incidents stand out. One occurred when Dietrich, as president 



76 TREASON'S PEACE 

of American I. G. Chemical Corporation, brazenly and falsely de- 
nied under oath before the Securities and Exchange Commission 
that he had any knowledge of who was the beneficial owner of 
the controlling shares of that company. 

Nothing being done to him for this offense, he may have felt 
immune, but three years later was indicted in three separate ( and 
still untried ) conspiracy actions. Then in 1945 Dietrich was sum- 
moned before a Federal Grand Jury and questioned without 
waiving immunity; as result of which a Federal Judge, with 
consent and approval of United States Attorney General Francis 
Biddle promptly dismissed all three indictments against this 
brother of war criminal Hermann Schmitz. 

It is perhaps needless to say that efforts to induce the Depart- 
ment of Justice to explain this chain of events have been unavail- 
ing. Neither has elucidation been forthcoming as to why the in- 
dictments against Hermann Schmitz himself which were not 
tried during the war because we couldn't catch him have not now 
been tried; nor has this distinguished gentleman paid us a courtesy 
visit to plead not guilty and have the indictments dismissed. 

Geheimrat Hermann Schmitz also has two promising nephews, 
Max and Rudolph W. Ilgner; Rudolph was shipped off to America 
in the 1920's. Max, the more brilliant, remained with Uncle Her- 
mann, married Karl Duisberg's daughter, and rose to high rank 
as a Managing Director and head of Farben's Central Finance 
Bureau, which polite name cloaked Max's activities as chief of 
espionage, sabotage, and propaganda. In that capacity, Max was 
directly responsible for carrying out the financial details of Far- 
ben's cartel and patent agreements and for placing and using 
secret funds and secret agents in foreign countries. Max Ilgner 
has admitted that these activities were tremendous in scope and 
corrupt in character in the United States. 

Strongly attracted to the vicious doctrines of Nazism as offer- 
ing the appropriate vehicle for Farben's pattern of world conquest, 
Max Ilgner was Farben's main representative in the inner councils 
of the Nazi party. 

Nephew Rudolph won the undying gratitude of his kinfolk, in 
Germany and in this country, by destroying by fire not long before 
Hitler invaded Poland certain secret files which a Grand Jury had 



TREASON'S PEACE 77 

demanded. These were the files of Chemnyco, Inc., the New York 
firm through which Rudolph had been publicly arranging patent 
licenses, and secretly directing espionage, propaganda, and other 
subversive activities. 

Instead of being jailed and heavily fined for conspiracy and 
arson, Mr. Ilgner, on a change of plea to guilty, was let off with 
a thousand dollar fine and precisely no years in jail. Whereupon 
he left the country club pleasures and social contacts of Green- 
wich, for a rural chicken farm in Connecticut, where he is today. 

Among Rudolph's many propaganda jobs was running the Ger- 
man American Board of Trade, and his best known feat was the 
grand banquet he threw in New York in March 1939 to welcome 
Fritz Wiedemann, Hitler's old commanding officer, who after suc- 
cessfully conducting Herbert Hoover about Europe on an educa- 
tional tour, had arrived in this country to take up his duties as a 
Farben gumshoe in the Consul General's office at San Francisco. 

Walter H. Duisberg, son of Karl, arrived in the promised land 
in 1927; settled first at Quogue, Long Island, and later in a fine 
home in Englewood, New Jersey; registered as a consultant on 
United States patents; and within the next decade engaged himself 
in multitudinous activities both here and in South America. He 
was a stockholder, director or .executive of every one of Farben's 
important corporate hideouts in this country and several in Latin 
America as well. 

This son of America's vindictive enemy won honors approxi- 
mating those of Hermann Schmitz in the various conspif acy indict- 
ments which broke out like a rash after the war began; Mr. Duis- 
berg was named by various Grand Juries in no less than five 
different criminal cases involving charges of restricting the pro- 
duction of nitrogen and ammonia, fertilizer materials, magnesium 
alloys, dyes, chemicals, and photo materials. Only the magnesium 
cases have ever come to issue in court, but Walter Duisberg had 
no cause to worry about any of them because, strangely enough, 
he was named merely as co-conspirator. (A co-conspirator desig- 
nation in a criminal indictment is like a mild case of chicken- 
pox a little rash, but no possibility of serious consequences, pro- 
vided the patient has competent doctors. ) 



78 TREASON'S PEACE 

In such a favorable atmosphere it may not appear strange that 
Mr. Walter Duisberg should have decided to press his luck and 
try to regain possession of a large block of stock in the Farben- 
owned General Dyestuff Corporation, of which he was registered 
as the owner when the United States Government rudely seized 
it as enemy-owned after we entered the war. 

At any rate, Mr. Duisberg brazenly went into court with a com- 
plaint that the Alien Property Custodian had stolen his property, 
and would the judge please make the thief give it back to him. 
The Court, to its credit, threw out this complaint. 

Later, however, an appeal was filed on this decision and lost, so 
it appears that the Duisberg claim is no go; in which respect, as will 
be seen later, he has not been as fortunate as some of his pals. 

Brief pictures belong here of other men of Farben, not rulers 
nor kin of rulers, who also came inside our lines in the prewar 
invasion. Also of some who, although born in America, appeared 
to regard this great privilege as a grant of right to serve the 
German Dye Trust first and always. 

A Farben employe in South America who proved most useful 
in softening up that continent for the recent war was Kurt 
Wojahn, brother of Max Wojahn, manager of Sterling's Export 
Department. It was Kurt's duty to place Farben's patent-medi- 
cine advertising in those Latin American newspapers which pub- 
lished news and editorials friendly to the Nazi government. Max 
seems to have had similar duties with regard to Sterling's advertis- 
ing and, as will be shown later, this brotherly relation was of 
considerable value in harmonizing the advertising policy of Sterl- 
ing with that of Farben. 

Another close relationship in Farben's American family was the 
Hutz father-and-son combination. Rudolph Hutz, the father, was 
head of General Aniline Works and vice-president and director of 
General Aniline & Film on that day in January 1942 when the 
Treasury Department requested him and a number of his col- 
leagues to take their hats and go. His son, W. H. Hutz, was a 
member of Farben's New York patent law firm of Hutz & Joslin, 
until some time in 1942, when he also received his marching 
orders from the United States Government. 



TREASON'S PEACE 79 

The story of Rudolph Hutz goes back far into the history of 
the Big Six. Born in Germany he was employed as a chemist by 
the German Bayer Company at Elberfeld from 1902 to 1909. He 
was then transferred to the American Bayer Company as Boston 
manager, and was there when Bayer and the other Big Six houses 
got into a little jam for bribing boss dyers, salting dyes and faking 
brand names in 1913. Hutz remained with Bayer until 1918, when 
he had a misunderstanding with the United States Government 
about espionage, and was indicted and interned at Ellis Island. 

After the Armistice Rudolph was released and soon thereafter 
became an American citizen with the sanction of some federal 
court which was either grossly deceived or else had a strange 
concept of what kind of citizens this country has need of. Be 
that as it may, as a naturalized American, Mr. Hutz climbed high 
in the American front of Farben, his one other mishap of record 
being the mention of his name as a co-conspirator in one of those 
1941 conspiracy indictments which are still on the stove or rather 
in the icebox. 

Many others, not related to Farben's leaders but trained in the 
Farben pattern, came to America to enter Farben's subsidiaries. 
Hans Aichelin,- a former Farben dyestuff expert came over in the 
late 20's, was put to work with General Aniline, and later became 
vice-president and director of General Aniline & Film. Mr. Aiche- 
lin, too, was among those indicted in December 1941 and was 
named again in a criminal complaint in 1942. Forced out of Gen- 
eral Aniline's board, he was finally ousted as vice-president by the 
Treasury in January 1942. He, too, will never be tried. He died 
in 1944. 

Ernest Schwartz, himself a former official of Farben and one of 
its leading research men, transferred his domicile to this country 
and became a director and president of Agfa Ansco in 1934, later 
director and vice-president of American I. G. when that company 
changed its name to General Aniline & Film. Mr. Schwartz, whose 
duties included experiments with photographic equipment for the 
United States Army and Navy, did not become naturalized until 
late in 1939, after the war started but when he did so he wanted 
everyone to know that he was a changed man. 1 am now an 



8o TREASON'S PEACE 

American citizen," he announced, "and have only sympathies with 
America." Two years later he, too, was indicted for conspiracy. 
And never tried. 

Leopold Eckler, another Farben-trained chemist, came to Amer- 
ica, was naturalized, and took his place in the management of 
Agfa Ansco. There he stayed until ousted by the Treasury, in 
January 1942. 

J. Rudolph Worch was still another newcomer whose rose to be 
assistant vice-president of Agfa Ansco at Binghamton, N. Y., and 
at one time was president of the Chamber of Commerce of that 
city. He left Ansco at the request of the Treasury in March 1942. 

The plant manager of General Aniline Works at the former 
Bayer dye plant at Rensselaer, N. Y., was Harry W. Grimmel, 
who worked in a Farben dye plant prior to 1926, and was then 
transferred to its American operations. 

Another higher-up technician was William Henry Cotton, born 
in Russia, who was employed by the German Hoechst from 1905 
to 1928, and then sent to General Dyestuff as chief chemist. 

Dr. William Hiemenz, a pharmaceutical chemist in I. G. Dyes, 
was sent to Rensselaer, N. Y., in the early 20s as Farben's director 
on the Winthrop board, and factory manager of the Winthrop 
Bayer manufacturing plant. The Treasury kicked him out of 
Winthrop in December 1941. 

Another pharmaceutical expert came to the United States from 
Farbenland in the early 30s, and wound up in an important posi- 
tion in the Winthrop plant. His name is Wolfgang Schnellbach 
and some of the things he took part in require special mention 
elsewhere in the story. However, it should be related here that 
something actually did happen to Mr. Schnellbach. Not having 
been naturalized, and appearing to be somewhat objectionable, he 
was interned at Ellis Island where, at last accounts, he was waiting 
for his family to join him through some sort of special dispensation. 

Dr. Bruno Puetzer was another Farben chemist who came to 
this country and became a Winthrop chemist. Winthrop also in- 
herited one of the first World War technicians of the Metz Labora- 
tories in the person of the Swedish-born A. E. Sherndal, who later 
became a Bayer- Winthrop expert at the Rensselaer, N. Y., plant. 

Alba Pharmaceutical, after it was organized in 1935, was assisted 



TREASON'S PEACE 81 

in its cooperative relations with Farben by the election of a Ger- 
man national, H. Vogel, as secretary, treasurer and director. 

Dr. Karl Hochswender came to the United States and served 
in Chemnyco as an expert on Farben patent licenses and the collec- 
tion of royalties. In 1941, at a critical time for Farben, the doctor 
was twice indicted as president of Magnesium Development Corp., 
and denied knowing his master's voice with somewhat unhappy 
results, when Attorney-General Robert H. Jackson impounded 
Farben's bank account in 1941. 

There are many others who might be added to this dubious 
honor roll. Some are important and would be described except 
for the official hush-hush policy behind which, unhappily, so many 
of these imported Americans still remain hidden. One more sketch 
belongs here. 

In December 1941, shortly after Germany declared war on the 
United States, The New York Times published a statement by 
Ernest K. Halbach in which he denied that General Dyestuff Corp. 
was foreign owned. The Times, a few days earlier had referred 
to an action of the United States Treasury Department in freezing 
the assets of General Aniline & Film Corp. and of General Dyestuff 
"due to foreign ownership." 

Mr. Halbach, as president of General Dyestuff, thereupon wrote 
The Times that his company, "is a New York corporation; that all 
of its stock is owned by American citizens; and that all of its officers 
and directors are American citizens." "The ownership and manage- 
ment of General Dyestuff Corporation is exclusively in the hands 
of American citizens," continued Mr. Halbach, "therefore there 
cannot be any possible justification for your statement." 

Mr. Halbach, in his dissertation on American ownership was 
adhering strictly to the Farben pattern, and repeating the exact 
words used back in 1917 by Kuttroff, Pickhardt & Co., and the 
New York Badische, both of which had employed Mr. Halbach, 
and were predecessors of General Dyestuff. The occasion in 1917, 
as in 1941, was the declaration of war between Germany and the 
United States, and the imminence of the seizure of enemy-owned 
property in this country. 

In 1941 these protestations were of no avail. The Treasury De- 
partment disregarded them. The Department of Justice indicted 



82 TREASON'S PEACE 

both General Dyestuff and Mr. Halbach for conspiracy, and six 
months later they both were again indicted and the new Alien 
Property Custodian seized General Dyestuff as a German- or 
Farben-owned concern. 

Now going back for a moment to the 1917 incident, a newly 
formed corporation called Kuttroff, Pickhardt & Co., of which 
Halbach was an important employe, had just become the osten- 
sible owner of the assets of the New York Badische, the American 
branch of the largest of the Big Six, which it was claimed, went 
through voluntary liquidation. However, World War I had started 
a few months previously, the Trading with the Enemy Act had 
been passed, and the Alien Property Custodian was threatening 
to seize both Kuttroff, Pickhardt & Co., and Badische. "You can't do 
that to us," protested Mr. Halbach's employers. "All the officers, 
directors and stockholders of this company are citizens of the 
United States." That time the American-citizen stuff partially 
worked. The new Kuttroff, Pickhardt concern escaped but the 
custodian did seize about half a million dollars which was in a 
New York bank. 

The Custodian's investigation uncovered the fact that various 
records and account books had mysteriously disappeared and cer- 
tain entries in those available appeared unexplainable. For ex- 
ample, in the early years of its existence all importations from the 
German house were entered on its books on a consignment basis. 
Then, the year before the war began, they appeared as purchases; 
yet during the war the bulk of its profits, amounting to more than 
$1,500,000 were transferred to Germany. 

When New York Badische secured German dyes from the two 
submarine cargoes in 1916, they were entered on its books as pur- 
chases. Later, when a profit of $400,000 was made on these dyes, 
the book entries were charged to a consignment, and the funds 
sent to the parent company. 

Finally, an agreement was turned up by the Custodian which 
showed that an option was outstanding by which Messrs. Kuttroff 
and Pickhardt were obligated to turn back their shares in the 
New York Badische at par value to the Big Six house on its demand. 
So it was evident that this company, like all the other Farben 
fronts, had a string tied to it a German string to be pulled at 



TREASON'S PEACE 85 

the proper moment in Farben's perpetual "All-American Puppet 
Show/' 

In 1919 we find the patriotic Mr. Halbach, in the interest of 
imported German dyes, canvassing for signatures to a petition 
which protested the efforts of the American Government to pro- 
tect the infant domestic coal-tar dye industry then struggling to 
survive. 

When Halbach in 1941 was proclaiming the American owner- 
ship of General Dyestuff, successor to the Kuttroff, Pickhardt dye 
interests, he was referring to his own alleged majority control of 
its stock. This alleged Halbach stock control dated back to 1939 
when the company transferred to his name shares formerly held 
by that other American patriot, Herman Metz. Metz became ma 1 
jority stockholder in General Dyestuff through his holdings as an 
organizer^of the company, plus the shares he acquired when 
duPont turned over to him, as Farben's agent, the Grasselli inter- 
est in General Dyestuff. 

These many transfers of stock may appear complex and be- 
wildering, but the pattern is plainly discernible the objective 
always the same. The truth is that in 1941 Halbach held majority 
stock control of General Dyestuff, and with W. H. Duisberg, held 
title to nearly all of the shares. However, an option on all of the 
Halbach-Duisberg stock was held by Chemnyco, Inc. The latter's 
stock was owned nominally by American citizens, but these were 
also Farben agents, and Chemnyco was incorporated and func- 
tioned exclusively as a Farben agency. 

Kuttroff, Pickhardt & Co., as a name, t disappeared from the 
scene in 1931 when its various Farben interests in the United States 
were segregated into new companies. This name had served its 
purpose long and well, the original members of the firm were gone 
and Farben was now entrenched in several brand-new American 
subsidiaries. However, William Paul Pickhardt, American-born 
son of one of the early partners, along with Halbach, continued 
to play an important part for Farben. Mr. Pickhardt during 
the next ten years held many offices in Farben subsidiaries, in- 
cluding chairman of the board of Synthetic Nitrogen Products, 
and of Agfa Ansco; president of Chemnyco; vice-president of Gen- 
eral Aniline & Film; and director of American Magnesium; Gen- 



84 TREASON'S PEACE 

eral Dyestuff; Ozalid Corp.; Jasco; and Plaskon Co. The latter 
was a manufacturer of waterproof glue and plastics, seldom rec- 
ognized as a Farben subsidiary. 

William Paul Pickhardt was indicted on Sept. 1, 1939, along 
with Synthetic Nitrogen Products and others in the synthetic 
nitrogen-ammonia conspiracy. He died in January, 1941, while 
the indictment was still pending. 

Now let us go back for another moment a long way back to 
1871 when Adolph Kuttroff and William Pickhardt, two young 
German nationals, organized a firm called William Pickhardt & 
Kuttroff to import coal-tar dyes and chemicals from the Father- 
land. In 1906 this firm changed its name to Continental Color and 
Chemical Co. Then, in 1917, the good old American names of 
Kuttroff and Pickhardt again appeared on its letterheads. 

Ernest K. Halbach entered the employ of Pickhardt & Kuttroff 
in 1899 and from that day on, for more than half a century, this 
native-born American was to shuttle back and forth in the long 
razzle-dazzle of changes of name and concealment of ownership 
through which first Badische, and then Farben as the actual em- 
ployers of Mr. Halbach, attempted to hide their identity. 

By 1920 Halbach had risen to be a director of Kuttroff, Pick- 
hardt and was directly involved in the firm's efforts to bamboozle 
the State Department into turning over to it the importation of 
German dyes. In 1926, when Kuttroff, Pickhardt transferred its 
dye business to General Dyestuff, Mr. Halbach went along with 
the business. 

And in 1942 Mr. Halbach, living luxuriously in ultra-fashionable 
Short Hills, New Jersey, environment with a summer home at 
Nantucket, was presumably unhappy because he, an American- 
born citizen whose country was at war, had two criminal indict- 
ments chalked up against him which involved him with the en- 
emy; also because the 4,725 shares of stock registered in his name 
or that of his wife and trustees, which carried alleged ownership 
control of General Dyestuff Corporation, were now locked up in 
the strongbox of the Alien Property Custodian. 

So, Mr. Halbach consulted counsel and it will appear that he 
chose his legal advisers wisely, in that old and well-known Wall 



TREASON'S PEACE 85 

Street law firm which is still addressed as Sullivan & Cromwell 
( although its founders of those names have long since been gath- 
ered to their fathers ) . 

Ornamenting this law firm is that celebrated attorney, public 
spirited citizen, religious leader and adviser on affairs of state, 
John Foster Dulles. 

It was perhaps a coincidence that Mr. Halbach should have 
selected as his counsel the law firm of Mr. Dulles during the period 
when the latter, in addition to his many other commendable public 
activities, was the chief adviser of Republican Governor and can- 
didate for President Thomas E. Dewey; was about to become 
adviser to our Secretaries of State on problems of war and peace; 
and was a member of the consulting committee established by 
the Alien Property Custodian to assist in formulating the basic 
policies of that office on the methods of controlling foreign prop- 
erty. As a sidelight on such activities it might be appropriate to 
mention here that Mr. Dulles is also listed, as recently as 1945, 
as one of the directors of the International Nickel Co., of Canada, 
which company, and several of its officers also have been among 
the unfortunate corporations and individuals like Mr. Halbach, 
to be accused of conspiracy with I. G. Farben and others. 

As to the two indictments in which Mr. Halbach was so un- 
happily accused, one, that of December, 1941, was postponed as 
has been mentioned before; and the other, of May, 1942, after 
a long succession of legal technicalities and behind-the-scenes 
wire pulling came finally to an issue in 1946, when eight of the 
corporate defendants, including General Dyestuff, and General 
Aniline & Film, along with seven of the individuals named, were 
found guilty on pleas of nolo contendere, and fined from $2,000 
to $15,000 each. Mr. Halbach, along with twelve of the other in- 
dividuals indicted, was cleared of all culpability by having the 
charges dismissed. So the Halbach indictment score now stands 
at one down and one to go. 

Meanwhile the new management of General Dyestuff appointed 
by Mr. Leo T. Crowley, as Alien Property Custodian, decided that 
it would be sadly handicapped in its efforts to drive the Farben 
dyestuffs and the Gestapo secret agents who distributed them 



86 TREASON'S PEACE 

out of the Latin American countries unless they should retain 
the services of Mr. Halbach, who according to the indictments 
pending, had enjoyed such intimate conspiratorial relations with 
those very same agents of the German Dye Trust both before and 
after the war started, his company having been grabbed by Uncle 
Sam for trading with the enemy. 

So Mr. Halbach was re-engaged as an adviser to General Dye- 
stuffs at an annual salary reported to have been $36,000 a year, 
plus bonuses which increased his annual take to some $82,000, 
quite a bit more than the president of the company received and, 
strictly speaking, this cash all came out of the United States Treas- 
ury via the office of the Alien Property Custodian and the staff 
appointed by the latter to run this enemy property. 

Then, on March 18, 1944, in the United States District Court 
at Newark, New Jersey, Elisabeth S. Halbach and Franklin H. 
Stafford, as Trustees for Ernest K. Halbach, followed the example 
set by Walter Duisberg in 1943, and filed suit against the Alien 
Property Custodian, demanding the return of the 4,725 shares of 
stock in General Dyestuff which had stood in Mr. Halbach's name. 
( Mrs. Halbach was not working for Uncle Sam or the Alien Prop- 
erty Custodian. Why shouldn't she sue them if she felt so in- 
clined?) 

At the same time seven other stockholders, allegedly owners of 
a total of 1,178 more shares in this Farben subsidiary, also filed 
suits against Mr. Crowley in the New Jersey and New York courts. 
All of these gentry were American-born citizens who, while em- 
ployed by General Dyestuff, had not only taken title to certain 
holdings in its stock by paying various sums in cash for same, but 
each had also signed an agreement which, among other things, 
gave the company an exclusive option to repurchase these hold- 
ings. Same old stuff of the first World War American owned, with 
a Farben string attached. 

In these eight lawsuits, as in the Duisberg case, the Alien 
Property Custodian very properly began to defend the seizure 
of these holdings. In an affidavit filed in December, 1944, by James 
E. Markham, who had succeeded his friend Mr. Crowley as Alien 
Property Custodian, the seizure was justified by affirmations, in 
rather blunt language that 



'.'W 

TREASON'SPEACE 87 

General Dyestuff Corporation and the record owners of the 
stock were acting in behalf and for the benefit of I. G. Farben- 
industrie, a national of an enemy country, Germany. 

and that the Government case would be proved 

by bringing together the complicated threads of a conspir- 
acy extending over many years and involving persons in many 
different countries. 

( which was a pretty good brief description of I. G. Farben's world- 
wide conspiracy against peace). 

This Custodian affidavit contains some other good points touch- 
ing on the activities of Mr. Halbach and these employes of Gen- 
eral Dyestuffs and, in plain language, called the titles to the stock 
fraudulent and a camouflage to cjoak Farben's actual ownership. 
For all of such reasons the Custodian demanded a trial in open 
court of the factual issues involved in these cases. 

The Halbach claim being by far the largest, it was decided that 
this case should be tried first, so that decision on the others could 
be more readily adjudicated. 

Among the other claimants were one Rudolph Lenz who, prior 
to its seizure, had been a vice-president of General Dyestuff, 
H. W. Martin, and A. T. Wingender, also executives. All three 
were kept on the job under Mr. Crowley. Lenz was indicted along 
with Mr. Halbach, in the May, 1942 criminal action but unlike 
Halbach his indictment was not dismissed when fifteen of the 
defendants were fined. 

Mr. Lenz was also fortunate in having Mr. John Foster Dulles' 
law firm, Sullivan & Cromwell, represent him against the Alien 
Property Custodian; as did Mr. Percy Kuttroff another of the 
claimants, of the old family concern out of which General Dyestuff 
was created. 

What happened then may appear strange unless we could get 
behind the scenes and listen in at the secret agreement secretly 
arrived at instead of the public trial in open court as demanded in 
the Custodian's affidavit. 

As of February 2, 1945, the settlement out of court was made 
public, eight separate settlements, by which the claimants were 



88 TREASON'S PEACE 

paid off in cash on condition that each should withdraw and forget 
their claims for the General Dyestuff stock, sums totaling some 
$696,554, out of the United States Treasury. 

The Halbach share of the booty was the tidy sum of $557,550. 
Attorney General Francis Biddle, and the Custodian, announced 
through the press that the settlement "cleared the way" for the 
sale of General Dyestuff to some one else. We may agree that this 
settlement might have cleared the way, but it hardly cleared the 
air. 

One characteristic may appear to stand out in these sketches 
the arrogant defiance of law, and the gentle treatment that has 
been accorded the royal family of Farben when these gentlemen 
have been caught with the goods. 



CHAPTER VI 



^Tarnung" The Magic Hood 
which renders the wearer invisible 



"AFTER THE FIRST 

war we came more and more to the decision to 'tarn' ( hood 

or camouflage) our foreign companies in such a way 

that the participation of I.G. in these firms was not shown. 
In the course of time the system became more and more per- 
fect. 

"If the shares or similar interests are actually held by a neu- 
tral who resides in a neutral country, enemy economic warfare 
measures are ineffectual; even an option in favor of I.G. will 
remain unaffected. 

"Protective measures to be taken by I.G. for the eventuality 
of war should not substantially interfere with the conduct of 
business in normal times. For a variety of reasons it is of the 

utmost importance that the officials heading the agent 

firms which are particularly well qualified to serve as cloaks 
should be citizens of the countries where they reside. 

89 



go TREASON'S PEACE 

"In practice . . . . .a foreign patent holding company could 
conduct its business only by maintaining the closest possible 
relations with I.G., with regard to applications, processing 
and exploitation of patents it is sufficient to refer to our 
numerous agreements providing for exchange of patents or 
. experience. 

"The adoption of these measures would offer protection 
against seizure in the event of war." 

The above excerpts, taken from original pre-war records of 
Farben's legal department, describe in vivid language the purpose 
of Farben's American hideouts and the instructions by which 
Farben's American agents were guided. 

Also included in these pre-war memoirs was anticipation of the 
victory which at that time Farben contemplated, when disguises 
would no longer be in order, as follows: 

In the case of winning this war the mightful situation of 
the Reich will make it necessary to re-examine the system 
of Tarnung.' Politically seen, it will often be wished that the 
German character of our foreign companies is openly shown. 

After the war began Farben's legal solons continued their dis- 
cussions and reports on tarnung. Some of these also may appear 
appropriate here as follows: 

"These camouflaged companies proved very useful. 

"Only about 1937 when a new conflict became 

apparent did we take pains to improve our camouflage in 

the endangered countries in a way that they should even 

under wartime difficulties, at least prevent immediate seizure. 

"Camouflage measures taken by us have stood us in good 
stead, and in numerous cases have even exceeded our expecta- 
tions." 

Reference in these reports to Farben American hideouts permits 
no doubt as to the importance attributed to the use of tarnung s 
magic in this country. 



TREASON'S PEACE 91 

The firm of Kuttroff, Pickhardt & Co. was always meticulous in 
the handling of its commercial affairs. It held itself aloof from the 
rough stuff indulged in by other Farben agents and conducted 
its business dealing with the American public with a dignity and 
courtesy which was in marked contrast to the loud-mouthed bull- 
dozing and slapstick with which Herman Metz displayed his Far- 
ben wares in the American marketplace. But both, in their respec- 
tive fields, were of similar value to Farben. They were "Ameri- 
cans." 

My own contacts with Kuttroff, Pickhardt & Co., originated in 
the early 1920's through a request for advice regarding the pro- 
duction of arsenical insecticide products which that company had 
made to the Crop Protection Institute of the National Research 
Council in behalf of the German Badische. The Institute referred 
the inquiry to me, and I am happy to relate that as a result of my 
advice, Badische and Farben did not enter the field. That was 
one of the few branches of the chemical industries in the United 
States which Farben decided to keep out of; possibly they con- 
sidered it wiser to save up Germany's arsenic as a reserve for mak- 
ing the deadly arsine war gas. 

It may appear uncertain whether the earlier creation of the 
illusion of American ownership of Kuttroff, Pickhardt was due 
to the threat of anti-trust proceedings or was in anticipation of 
the first World War. On the record, however, the concealment of 
ownership of both Kuttroff, Pickhardt in 1914, and of General 
Dyestuff in 1941, directly preceded our two wars with Germany. 
And in both instances Yankee Halbach was in there pitching for 
Farben. 

In 1919 Francis P. Garvan denounced the conduct of Kuttroff, 
Pickhardt with the statement that: 

"If they were American citizens their conduct was such as 
would not entitle them to much consideration, because Mr. 
Kuttroff endeavored to send as much property as possible to 
Europe after Bernstorff had gotten his papers, and when war 
with Germany was certain he collected every bit of cash pos- 
sible and resorted to every possible subterfuge in the manipu- 
lation of books etc., to transfer those assets to our enemy a 



9* TREASON'S PEACE 

few days before we actually went into the war, and long after 
relations had been severed and Bernstorff had gone back/' 

When he said this Mr. Garvan might well have been foreseeing 
some of the same kind of transfers of American funds which in 
1941 were passing into the invisible hands of Farben from suc- 
cessors of Kuttroff, Pickhardt. 

Nor did Mr. Garvan hesitate to express his convictions about 
the relations between these native-born American citizens and 
their German I.G. masters. In 1922, after years of searching in- 
vestigation of the Badische and Hoechst American companies, he 
announced his conclusion that the German owners had never 
really parted with control of these branches. Said Garvan: 

"The truth is that neither Metz nor Kuttroff, Pickhardt & Co. 
it is my contention ever owned a dollar's worth of their 

companies here They never have been and never will 

be anything but clerks of the German I.G." 

Mr. Garvan deeply resented the fact that after he had seized 
tfee Hoechst-Metz company as Alien Property Custodian, Metz 
claimed that he had already "bought" back the assets of the com- 
pany in an absurd jack-in-the-box transaction by which not one 
cent of money was passed, and in which Metz signed an irrevo- 
cable power of attorney transferring back to Hoechst the shares 
he had pretended to purchase. This transfer was attached to the 
stock certificate, deposited in a safety deposit box outside the 
United States, and held at the sole disposition of the German 
company. 

In 1919, over Metz's violent protests, Garvan seized the Hoechst 
New York bank account and attached the Hoechst shares in the 
name of the United States Government as enemy owned. Then 
started a protracted court battle in which Metz exhausted his 
vocabulary on the witness stand and in the courthouse corridors 
in expressing his opinion of Garvan. 

There followed, in 1921, one of the most notable triumphs ever 
scored by Metz in his long career as the I.G. hatchet man in the 
United States. On June 2nd, Judge Julius M. Mayer in the Federal 
Court in New York City, handed down a verbose decision which 



TREASON'S PEACE 93 

awarded the title of the Hoechst shares to Herman Metz. Judge 
Mayer predicated his decision upon several rather naive pro- 
nouncements: 

"As a seizure by the Alien Property Custodian is likely 
to carry the suggestion to those not informed in respect of the 
controversy, that the demandee ( Metz ) in some manner may 
have been improperly associated with the enemy, it is de- 
sirable at the outset to state that no such situation exists here 

The transactions here took place long before our entry 

into the war and, indeed, before the European war started 
and had no relations to either." 

The court's decision conceded that some of the correspondence 
between Metz and Hoechst bearing on the transaction was miss- 
ing, and that the testimony of Metz contained what the Judge 
politely described as "inaccuracies." "However," held the court, 
"that Metz should deliberately by his testimony falsify the true 
transaction is not to be thought of." Finally the court came to the 
conclusion that although the: 

"Stock ownership would not affect the apportionment of 
profits (between the Metz Hoechst and the German Hoechst) 

this testimony of Haeuser can only be rejected upon 

the theory that both Haeuser and Metz have willfully deceived 
the court by false testimony." 

Judge Mayer rejected the Garvan proofs that Messrs. Haeuser 
and Metz had for years been willfully deceiving the American 
people as well as the court. So Metz got back the Hoechst stock 
and the Hoechst New York bank account of more than $500,000 
a sum which came in very handy in the development of the dye 
and pharmaceutical factories which, a few years later, Metz was 
to turn over to Farben's new American fronts. 

Shortly after this decision was handed down, the Harding- 
Daugherty administration recognized the keen legal mind of 
Judge Mayer and elevated him to the Federal circuit court. 

Two of the more prominent of the Metz employes during this 
period were his brother, the late Gustave P. Metz, and Alfred E. 
Sherndal, both of whom were educated in Germany. Gustave was 



94 TREASON'S PEACE 

also vice-president of Farbwerke Hoechst during the fight about 
its seizure, and in that official capacity served notice on the 
Alien Property Custodian in 1919 that he would be held responsi- 
ble for all loss or damage for having swiped brother Herman's 
property. Later, both of these men were to have important posi- 
tions on the staff of the Winthrop Chemical Company. 

Winthrop, it will be recalled, was started so that Sterling could 
have an outlet for so-called ethical medicinals. Having progressed 
from the status of patent-medicine pitch artists by the acquisition 
of the Bayer Company, the Sterling management decided that a 
Dr. Jekyll was needed to sell prescription medicines to physicians, 
while the Mr. Hydes of Sterling peddled the nostrums. 

One fact stands out in the history of Bayer, from the time it 
first became prominent as the Farben Fabriken of Elberfeld, up 
to the recent war: its pattern of hidden control, unlawful activities 
and subservience to Farben has varied only in the type of treachery 
employed and the identity of -the individuals involved. On the 
record, if any one of the Farben names should be selected to head 
the roll of dishonor, that name is Bayer. 

The name Bayer Company was first used in the United States in 
1906; the plant of the Hudson River Aniline Works at Albany was 
acquired, and the manufacture of aspirin and a limited number 
of dyes was started. It was recognized as the American branch of 
the German company, but after the war started in 1914 the entire 
stock of the American company stood in the name of H. E. See- 
bohm, one of its German-born officers. Seebohm held this stock 
as trustee for fhree of the major stockholders of the German com- 
pany, Dr. Karl Duisberg, Rudolph Mann and Christian Hess. 

Thereafter a subsidiary was set up called Synthetic Patents Co., 
the stock of which was also trusteed for Duisberg, Mann and Hess. 
An elaborate bookkeeping system was devised by which almost 
all of the profits of the parent company were siphoned off to Syn- 
thetic Patents on the pretext of patent royalties and rentals. Sev- 
enty-five percent of 'the Synthetic profits then went to Duisberg 
and his colleagues for the pay-off men of German espionage and 
sabotage in the United States. 

After the United States entered the war, Bayer resorted to the 
old shell game; they organized a new company, the Williams & 



TREASON'SPEACE 95 

Crowell Color Co., and quietly slid the cash drawer under this 
third shell. 

The Alien Property Custodian was gratified and surprised when 
the Bayer executives stated frankly, "We are enemy owned/' and 
permitted seizure without protest. It was not until some time after- 
ward that Mr. Garvan's bookkeeping bloodhounds uncovered the 
dodge by which everything of value was being transferred out of 
Bayer's custody to their newly organized and nominally American- 
owned subsidiary. 

Charles J. Hardy, the New York attorney who had represented 
the Big Six houses in the pre-war anti-trust cases, was attorney for 
Bayer when it was seized, and he was retained by the Custodian 
to continue to act in that capacity while the property was in the 
hands of the Government. However, according to Mr. Garvan, it 
was discovered that Hardy was still representing the German in- 
terests, and that they were conspiring to establish an underlying 
company. So Mr. Garvan bounced Mr. Hardy and hired a new 
attorney. 

After months of painstaking investigation, Mr. Garvan's sleuths 
uncovered the whole sorry Bayer mess, and proved that German 
nationals and American-born citizens had worked together for a 
long period of years under the directions of German Bayer and 
the German government to set up and operate an espionage, sabo- 
tage and propaganda machine in the guise of an American manu- 
facturing plant producing dyes and pharmaceuticals. 

In the final report of the Alien Property Custodian, relative to 
Bayer, there was summarized the utterly treasonable character of 
its hidden control and secret activities, in part as follows: 

"The Bayer Co., of New York, was the largest and most 
powerful German-owned dye and drug manufacturing con- 
cern in America at the outbreak of the war. Carl Duisberg, 
the chief of the War Trade Board of Germany, was the owner 
of one third of the stock, and the company was largely used 
for the distribution of German propaganda funds in America. 
The higher officials of the Bayer Co. were nearly all unnatur- 
alized German citizens, and the entire capital stock was vol- 
untarily reported as enemy property within two or three 



96 TREASON'S PEACE 

months after the passage of the Trading with the Enemy Act. 
It became apparent, however, that this voluntary surrender 
was simply in line with German cunning." 

"Examination of depreciation charges, profit-sharing pay- 
ments, and royalties, resulted in uncovering and paying to 
the United States Treasury over $1,000,000 income taxes run- 
ning back to 1913 which had been systematically concealed/' 

Ten years later I was publicly accusing the new owners of that 
same Bayer Company of doing many of the same things their pred- 
ecessors had done. My reward was a kick in the pants many 
kicks. Another ten years passed, and the proofs that I was right 
about Bayer and all the rest of Farben's evil brood began to come 
out. I say these proofs began to come out because that coming out 
was stopped ruthlessly in federal administrative offices, in courts 
of law and in the Senate and House of Representatives of the 
United States, as will be shown in detail before this story is con- 
cluded. 

The Sterling agreements have been described in Chapter m. 
Messrs. Weiss, McClintock, Rogers and the others never had any 
illusions about the Germans with whom they were dealing. Weiss, 
bumptious and arrogant by nature, did at times attempt to out- 
brazen the I.G. leaders; as when Duisberg and Mann demanded 
that Sterling permit them to buy openly into the capital structure 
of the Sterling-Bayer Company. 

During the early negotiations for the I.G. comeback, Weiss fre- 
quently harked back to his promise to the Alien Property Custo- 
dian, and in one letter stated: 

- The advice of our counsel is that, this sale having been 
made by the United States Government, and this country still 
being technically at war with Germany, the Peace Treaty not 
being signed, we would run a grave risk of destroying the 
business, and of incurring the charge of bad faith in our 
dealings with the Government, if we entered into any contract 
affecting the property acquired by us at the Government sale 
of any part thereof. 



PEACE 97 

In later years, when Sterling, Winthrop and Bayer had become 
in effect an integral part of the Farben Empire, and the 1919 pledge 
had been violated repeatedly both in letter and spirit, Weiss again 
referred to his probity as a reason why Farben should not assume 
any technical ownership in the Bayer plant at Rensselaer, N. Y. 
In this instance Weiss stated his position in these words: 

I had always stressed to Dr. Mann and Justizrat Doermer 
the undertaking which we had to give to the United States 
Government at the time of the purchase of the Bayer Com- 
pany, Inc., from the Alien Property Custodian, that under 
no circumstances would the property purchased at that sale 
be otherwise owned, in whole or in part, than by interests 
one hundred percent American. The grounds and the building 
at Rensselaer are part of the property purchased and are 
therefore covered by the undertaking given by us. 

So Sterling then put entries on its books by which Bayer ap- 
peared to rent part of the Bayer land and factory to Winthrop 
which was not one hundred percent American owned and also 
sold to Winthrop machinery and equipment in the Bayer factory. 
This was done in order that Winthrop might claim to be a manu- 
facturer of the medicinals it was getting from Farben and packag- 
ing as "Made in America." The manufacturing consisted mainly 
in diluting or tableting imported Farben products and putting 
them in Winthrop bottles. The celebrated Winthrop Research Lab- 
oratories were in Leverkusen, Germany, where most of its prod- 
ucts were made. 

An early and flagrant instance of breach of faith was the turning 
over to Winthrop of patents and trademarks on so-called ethical 
medicinals which were involved in the purchase of the Bayer Co. 
Veronal and Luminal were two of the better known Bayer trade- 
marks transferred to Winthrop in violation of the pledge. 

However, the I. G. people were persistent. During the negotia- 
tions one of them wrote: "I quite understand that in its final form 
the agreement will have to leave room to read between the lines." 
Later, another letter expressed their abiding determination in the 
following: 



98 TREASON'SPEACE 

If you should still hesitate because of Washington, it should 
be taken into consideration, that for a certain provisional time, 
say, for instance, five years, another way could be found to 
get together so that no relation between our firm of Leverku- 
sen and your firm of New York would be apparent to the out- 
side world We are sure that if the will exists, a way can 

be found to attain the purpose we have in mind. 

Weiss and his usual associate in the dickering, McClintock, 
stepped back gradually from critical opposition to most of the 
proposals put forward by Dr. Duisberg and Rudolph Mann. A 
possible explanation of this more compliant attitude is found in a 
letter written by Mann to Weiss during the 1926 negotiations. This 
letter contained what may appear to have been the tender of very 
personal advantages to Weiss. One paragraph read: 

As a personal remark, we would like to add that the friend- 
ly relations between you and ourselves through such a new 

organization become only still more intimate You can 

be convinced that in the long end the new situation will be 
more advantageous to you. 

Whatever these personal advantages may have been they were 
evidently effective, and for many years Sterling worked hand in 
glove with Farben in concealing Winthrop's German ownership. 

And the United States was not the only country with which 
Sterling broke faith. Pledges or understandings were made to the 
British and French Governments when Sterling purchased the 
English Bayer Co., and the French Bayer trademarks respectively. 
In each instance it was specifically understood that Sterling was 
buying these foreign property rights as Americans for American 
ownership; instead Messrs. Weiss, Diebold and McClintock were 
acting, in effect, as agents of the German I.G., to whom partial or 
total ownership in these properties eventually passed. 

Another instance of flagrant deception resulted because of a 
requirement by the Chemical Foundation that all licenses granted 
by it under former LG. patents should go to companies owned 
at least seventy-five percent by Americans. The Metz company, 
after one half interest in it had been "purchased" for Winthrop 



-TREASON'S PEACE 99 

with Farben funds, needed a Chemical Foundation license. So 
the license was applied for, obtained and signed for on the basis 
of utterly false statements which denied a fifty percent foreign 
interest. 

In August 1928, word came to the leaders of Sterling that that 
ancient institution of learning, the University of Cologne, had con- 
ferred upon Weiss the degree of Doctor Philosophia honoris causa. 

Then, shortly after the election of President Hoover, three of 
the University's directors came to the United States, and at a ban- 
quet at the Biltmore Hotel, made the formal presentation to Herr 
Wilhelm Weiss, their beloved brother in intellectual attainment. 

The three directors, Justizrat Otto Doermer, Dr. Rudolph Mann 
and Dr. O. von Hoeffer of Farben, were, on this auspicious occa- 
sion, tactfully announced as die direktoren of the University of 
Cologne. 

Dr. Fritz ter Meer was present, also Walter Duisberg. Dr. Wil- 
helm Hiemenz, Colonel Metz, and Dr. E. von Salis of the original 
Bayer organization. Leader of the American cheering section was 
the great Republican potentate, the late Louis K. Liggett, who, of 
course, shared in the congratulations with Weiss for the recent 
triumph at the polls of his candidate, that eminent student of busi- 
ness and international affairs, Herbert Hoover. As Sterling window 
dressing came H. F. Behrens, Stanley P. Jadwin, John F. Murray, 
George C. Haigh, C. A. Aul and Otto Schenk; along with Earl I. 
McClintock, A. H. Diebold, Frank A. Blair, Raymond Foster and 
brother Fred E. Weiss. It was a happy occasion for all concerned. 

The Farben academicians who were present must have laughed 
up their sleeves at the notable success of such inexpensive soothing 
syrup for the rambunctious Weiss. A piece of parchment with a 
wax seal and a bit of ribbon attached was a small price to pay for 
a more docile obedience on the part of the wild west patent-medi- 
cine man who had already demonstrated his abilities to bully the 
American press and seduce the learned professions of this country. 
When it included a tie-string to the Hoover Republican, Louis 
Liggett, the doctorate became a rare bargain indeed. As a matter 
of fact those slick Farben scholars should have made it an earned 
degree, rather than an honoris causa. His acquaintances said at 



ioo TREASON'S PEACE 

the time that Wild Bill Weiss had surely earned everything that 
Farben gave him. 

- So the ceremony of robing the learned Weiss, the delivery by 
Justizrat Doermer of the Rektors address in high Latin; and the 
candidate's humble response ( in drug store Latin ) came to a glori- 
ous end with buckets of champagne and the haunting strains of 
"Nach die Heimat Wieder" stirring the potted palms and guests of 
the decorous Biltmore. A waiter who understood neither German 
nor Latin decided that it must be some kind of Ku Klux enrobing 
event. It was just that. 

According to the announcements the degree was awarded Mr. 
Weiss, in recognition of the arduous labors of the recipient in pro- 
moting more cordial industrial and scientific relations between 
German and American pharmaceutical companies. Thereafter it 
was always "Doctor" Weiss. The pharmacist who had left his pre- 
scription counter to peddle patent medicines could now point 
with pride to a title which gave rise to a belief in the minds of 
many that he was a member of the profession of medicine. Even 
real physicians were fooled by that title. 

It was just at this time that I was appealing in vain to Senator 
David I. Walsh of Massachusetts to demand a Senate investigation 
of Drug, Inc. 

On Nov. 8, 1928, 1 wrote Senator Walsh a forecast which missed 
the Hoover 1929 Stock Market debacle by six months. In part, 
that letter read as follows: 

Many of these who gave the mandate on Tuesday will be 
sick of their work inside of eighteen months, unless I miss 
my guess. 

I would like very much to be permitted to call to your 
personal attention a situation which I am convinced warrants 
your official scrutiny, and which later, after investigation, 
you may be inclined to bring to the attention of those of your 
colleagues in the Senate who appreciate the real significance 
of what happened on Tuesday. 

A few days later I talked, to Senator Walsh at some length about 
the situation as I saw it and received his assurances of great in- 
terest. On Nov. 19, 1928 I wrote him the following: 



TREASON'S PEACE 101 

Dear Senator Walsh: 

To further illustrate the point I made, when I saw you last 
week, about the power behind the National Republican Com- 
mitteeman from Massachusetts, I enclose herewith a collec- 
tion of advertisements clipped from a limited number of 
daily papers purchased at random in different parts of the 
United States. 

I also enclose a list of the companies which are alleged to 
be now all under one control, and which include these na- 
tional advertisers and many others. 

If you think it would be helpful or informative to you I 
will undertake to have a file prepared which will include: 

1. The advertisements under one control appearing on the 
same day in at least one daily paper in every state in the 
Union. 

2. The advertisements under one control appearing on the 
same day or week in every paper published in one or more 
states. East or West, which you may designate. 

3. The advertisements under one control appearing in the 
same week or month in the weekly or monthly journals of 
the U.S., popular and professional. 

I do believe that if this exhibit were made available to you 
you would have a picture of the background or twilight zone 
of the Republican Party as now constituted that would make 
the Trade Commission investigation of the Power Trust look 
like small potatoes indeed. 

Hoping this may interest you and thanking you indeed for 
the courtesy you showed me, I remain 
Respectfully yours, 

Howard W. Ambruster 

Enclosed with this letter was a list of thirty odd American drug 
and patent-medicine companies and national advertisers which, 
according to published reports and trade rumors, had been 
brought into direct or indirect affiliation with the German I. G. 
Far ben as part of the German- American relations promoted by 
"Doctor" Weiss and the Liggett Republican machine. 

That was the end of the interest of Senator Walsh in this sub- 



102 TREASON'S PEACE 

ject, as regards any expression to me, or to the public, so far as I 
have heard. 

It was never a secret that Bayer's Dr. Karl Duisberg, as former 
chief of the German War Trade Board, and Cassella's Dr. Karl 
Weinberg, as first president of the I.G. Dyes, were among the 
strongest early supporters of the Weimar Republic. As cabinet 
ministers, Reichstag members and Councillors, a succession of 
dye trust leaders served and directed the Reich; and through 
ownership of leading German newspapers, helped to make and 
break its ministries. 

It was also a matter of official record in the United States that, 
in 1926, when I.G. Farben was put together, under Dr. Duisberg 
as its first chairman, to become the largest industrial combination 
in Germany, it promptly tied in to an indissoluble union with the 
Hugo Stinnes and Fritz Thyssen steel interests which, as the 
Vereinigte Stahlwerke, had become the second largest cartel in 
Germany. 

United through their jointly owned coal mining combine, the 
Rheinische Stahlwerke, and through interlocking directorates and 
mutual stock ownership, Farben and the Thyssen Steel trust from 
then on were the dominant force behind the scenes, of a succession 
of German governments which finally descended to the gutters 
of Munich for Hitler's Nazis. 

And it was Dr. Duisberg, for the industrialists, who joined with 
the Junkers or Reichs-Landbund (landed agricultural gentry) in 
1927, to make the gift of the Neudeck Castle and huge estate to 
the senile Hindenburg, thus securing a stranglehold on the aged 
soldier and inducing scandals which, when the time came, served 
as a pretext for the downfall of the republic and the elevation of 
a Hitler, also financed, armed, and implemented for conquest, by 
the combined Farben-Thyssen interests. 

While the elder Duisberg was thus occupied with the Father- 
land's puppet show, his son Walter, as an American citizen by 
choice, was becoming a chief connecting link with substantially 
all of Farben's false fronts in the United States and Latin America. 
Weiss, McClintock, and other Sterling leaders were continually 
in Germany and they were advised from the inside how politi- 
cal and governmental affairs were developing. In the early 30s 



TREASON'S PEACE 103 

Farben's leaders began bringing the Nazi government into the 
picture as a reason, or pretext, for the restrictions and conditions 
which they insisted upon in their dealings with Sterling. Time and 
again Sterling yielded to Farben demands that were predicated 
on an alleged government requirement. However the Sterling peo- 
ple were told that the Hitler Reich was right down Sterling's alley 
for sound money and safe international trade. 

Rudolph Mann communicated the complacent viewpoint of 
Farben towards the Nazi government in a letter to his good friend 
Doctor Weiss in 1933: 

With regard to Germany we undoubtedly are in 

a clearly noticeable change for the better, as the present Na- 
tional government has within their rows prominent, moderate 
elements so that all of us confidently believe that irrespec- 
tive of the maintenance of the strong, psychologically valu- 
able, national feeling they will desist from making commer- 
cial experiments. 

I lay special stress on telling you and all my friends in Amer- 
ica that the ghastly fictions on the activity of the National 
Socialists, which have appeared in some American papers, do 
not correspond to real facts whatsoever. We actually have be- 
hind us a revolution which will entail a complete remodeling 
of our spiritual and commercial life in the positive direction. 
That such a revolution will not go by without some single 
cases which have been dealt with in a somewhat unfortunate 
way, is not worth the while being mentioned. In German this 
is called: Where one planes, there will fall shavings' 

Today's Germany is the safest country you can find in Eu- 
rope, free from Communism, strongly conducted, with their 
currency in good order, and with men who not only have the 
desire but also the force and capability of changing the im- 
portant commercial problems for the better in the interest 
of Germany and of international trade. 

Mann was making Farben's support of Hitler attractive in the 
kind of language which Weiss and his pals could comprehend. 

Some writers who have discussed this matter appear to believe 
that Farben was helpless to control the actions of Hitler's officials. 



104 TREASON'S PEACE 

But there is abundant evidence that the Nazis were financed by 
Farben, that Farben leaders occupied high places in the Nazi gov- 
ernment from its beginning, and that Hitler's armies would have 
been helpless without the years of preparation and continued sup- 
port of Farben. History will tell which end of the dog was Farben. 

However in considering the subservience of Sterling's leaders to 
the restrictions and continued deceptions insisted upon by Farben, 
it makes no difference whether the latter was in fact compelled 
to so instruct Sterling or whether Farben itself was really responsi- 
ble for the alleged official instructions which it passed out on 
alleged compulsion. Either way the result was that Sterling, and 
all of the others in the United States who yielded to any such in- 
structions and deceptions were in plain fact acting as agents for 
the Farben-Hitler government, and helped conduct its economic 
industrial warfare and subversive activities. 

The "government" instructions insisted upon by Farben and 
with which Sterling complied covered every important aspect of 
the relationship between them. Farben compelled Sterling to pay 
large sums of money over and above the contract provisions on 
the plea that these funds were required by order of the Hitler 
government; Sterling was denied technical information relative to 
patents and processes to which, under the contracts Sterling was 
entitled, on the plea that the Nazi officials would not permit that 
data to leave Germany; Sterling was required to conceal various 
phases of its relationship with Farben on the plea that the gov- 
ernment might not approve of them; and finally, Sterling's officials 
were compelled, or instructed, to assist in the Nazi underground 
work in the American Hemisphere. 

What all this amounted to was that Farben was conveying to 
the Sterling leaders orders from the Nazi government, and Sterl- 
ing's officials obeyed them. Their absolute loyalty was to Farben 
and to Farben's government, to the complete exclusion of all other 
considerations. 

In 1934 after Farben's interest in Winthrcp had been transferred 
to the American I.G. it was gently intimated to Sterling that it 
might not look right if the German government discovered all 
that Farben was doing for Winthrop without getting paid for it. 
(American I.G. was meanwhile getting the dividends on fifty 



TREASON'S PEACE 105 

per cent of the Winthrop stock but the German government, as 
well as that of the United States, was not supposed to know that 
Farben owned American I.G.) Therefore, suggested Farben, a 
"service fee of $50,000 a year" over and above all existing contract 
arrangements, should be forthcoming. So Sterling, or Winthrop, 
came across with the extra $50,000 a year. 

In 1938 another squeeze play was worked, this time it was actu- 
ally claimed that the German government had just discovered 
Farben's agreement with Winthrop and was upset because Farben 
apparently was not getting anything out of Winthrop on the 
Winthrop-Sterling contract. A hurried call was sent out for a con- 
ference at Basle, Switzerland. Several of the highest Farben lead- 
ers, headed by Dr. Hermann Schmitz, attended, and Earl I. Mc- 
Clintock was sent to represent Sterling and Winthrop. Walter 
Duisberg, D. A. Schmitz and Hugh Williamson were present, 
presumably to represent the interest of American I.G. 

McClintock, according to his account of the meeting, was taken 
for a ride around the city of Basle while the delegates conferred. 
Then he was led into the meeting and taken for another, and dif- 
ferent, ride. They told him that the German government had de- 
creed that somebody, Sterling or Winthrop, would have to come 
across again with another good, fat annual sum. It was all very 
pleasant and just too bad that the Nazis were so nosey but what 
could poor Farben do but to tell Sterling to tell Winthrop to pay 
up or else? So Winthrop began paying a new "service fee" of 
$100,000 a year. As a pre-war gangster's squeeze play it was perfect. 

However, the Sterling leaders knew they were trapped long 
before this; if they refused to play ball Farben could cut off their 
supplies of Winthrop's "American made" products. The patents 
under which these products were sold in the United States ex- 
clusively by Winthrop were of little use to Sterling except to pro- 
tect the monopoly, because Farben had not told Winthrop how to 
make them and accordingly, Winthrop did not know how to do so. 

Weiss and his colleagues also had ample warning that war was 
coming, and then they began to squirm in earnest. When one of 
the Alba contracts was being entered into between Sterling and 
Farben in 1937, Nazi government restrictions were the reason 
given for refusal to assign Farben United States patents to Alba 



io6 TREASON'S PEACE 

unless a re-transfer clause was included. At this time the possi- 
bility of war between the United States and Germany was defi- 
nitely indicated in correspondence between Alba and Sterling of- 
ficials, both of whom, it appears, were former Farben employes. 
In a letter dated July 29, 1937 which passed between these two 
American companies about the Farben Alba patents it was stated: 

It is to be considered, however, that the patents, if as- 
signed to an American firm, cannot be seized, say in the case 
of international complications. 

The only kind of international complications which could pos- 
sibly result in seizure of Farben's United States patents was war 
between Germany and the United States. Despite the warning, 
Sterling officials went right along expanding and even tried to get 
Farben to join them in further relations. The latter replied that 
they could not spare the funds just then. 

Some futile efforts were made to get data from Farben in order 
that products which were being imported could be made at the 
Rensselaer plant, "in case manufacture should become necessary." 
Atabrine, the antimalaria substitute for quinine, was one of these 
products. Winthrop had never made Atabrine and did not know 
how to make it when the threat of losing our supply of quinine 
from Dutch East Indies gradually began to dawn upon our super- 
statesmen at Washington. 

The Farben pincers through Sterling on Atabrine worked in 
conjunction with that applied by the Japs in the Dutch East Indies 
on quinine; just as the Farben pincers through Standard Oil, on 
synthetic rubber worked in conjunction with the Japs on natural 
rubber. There is evidence also that Farben intended to work its 
pincers on synthetic nitrogen in conjunction with a friendly Chile 
staying with the Axis and cutting off our supply of natural nitrates. 

However, that Atabrine story belongs in another chapter, as 
do the details of deception and downright sabotage that involved 
Sterling's agents in South America. 



CHAPTER VII 



False Fronts Become Bold 



ON APRIL 20, 1929, 

Dr. Carl Bosch and a coterie of his Farben associates waved 
triumphant farewells to the Statue of Liberty and marched into 
the bar of the Hamburg-American liner New York, to celebrate 
the success of their mission to America. 

The Germans were returning to the Fatherland with all that 
they could have hoped for. Their understandings with our myopic 
industrialists had been most satisfactory, their arrangements with 
our avaricious financiers most profitable. And less than a week 
after their departure the American I.G. Chemical Corp. was 
launched suddenly and with a great blare of Wall Street pub- 
licity. According to reports on the Street that afternoon, its entire 
issue of $30,000,000 of 5% percent convertible debentures was 
oversubscribed in an hour. 

The formation of American I.G. had been a closely guarded 
secret, but after its announcement on April 26th no attempt was 
made to conceal Farben's part in the achievement. Both the pror 
spectus and the half -page advertisements announcing the under- 
writing contained a letter addressed to the National City Bank 
and signed by Geheimrat Dr. Hermann Schmitz and Dr. Wilfrid 

107 



io8 TREASON'S PEACE 

Greif, as managing directors of Farben, which recited the huge 
size of Farben and stated that: 

As a result of the development of its worldwide activities, 
I.G. Dyes ( Farben ) has found it desirable to cause a corpora- 
tion to be organized in the United States, under the name of 

American I.G. Chemical Corp with broad corporate 

powers to foster and finance the development of chemical 
and allied industries in the United States and elsewhere. 

The prospectus then went on to state that all of the common 
stock to be presently outstanding would be issued against cash, 
or to acquire stocks of Agfa Ansco Corp., and General Aniline 
Works. Both of these companies were known to be controlled by 
Farben. The prospectus also announced that the principal, interest 
and premium upon redemption of the B l / 2 % debentures were un- 
conditionally guaranteed by I.G. Farben and were payable at the 
National City Bank of New York in gold, with approximately 
$450,000,000 in Farben assets back of the guarantee. 

It was thus evident that the American I.G. was to be a Farben 
holding company for its manufacturing subsidiaries in the United 
States. The Farben guarantee of the interest on the debentures, 
plus the big names of the financial houses which underwrote the 
issue, and the big names of the American industrial and financial 
leaders on the board of the new company were sufficient incentive 
to cause unthinking American investors to fall over themselves 
in the rush to get in on a good thing. 

It should have been apparent by the most casual reading of the 
prospectus that control of American I.G. would remain not with 
the owners of the debentures but with the Farben promoters. Ap- 
proximately ten percent of the voting stock was all that the 
American investors could possibly secure. 

Just before Farben organized this new company and thereby 
financed its American industrial pincers with thirty million good 
American dollars on a prospectus signed by its Geheimrat Schmitz, 
that astute gentleman had also organized another dummy com- 
pany in Switzerland with the imposing name of Internationale 
Gesellschaft fur Chemische Unternehmungen A. G. of Switzerland. 
Known as the I.G. Chemie, this Swiss concern was a holding 



TREASON'S PEACE 109 

company for Farben's properties in foreign countries, and a part 
of its stock was offered to Farben's stockholders with Farben's 
guarantee of payment of dividends. 

When American I.G. was organized, I.G. Chemie did not 
appear as the recorded holder of majority control of its voting 
stock. But by 1940, after the war was started, this "neutral" Swiss 
concern, with one of its Swiss subsidiaries, held title to over 85 
percent of the outstanding shares of General Aniline & Film, 
successor of American I.G. At one time in the history of these 
two Farben fronts, the Swiss company was the recorded holder 
of something over 10 percent of the stock of the American com- 
pany, while the latter was also the owner of some 9 percent of 
the outstanding stock of the Swiss company. This exhibition of 
two Farben snakes swallowing each other by the tail undoubtedly 
afforded much amusement at the home office. 

However, back in April 1929, I.G. Chemie was a dark secret. 
Farben's ballyhoo centered around the names of the American 
financiers and industrialists who participated in the underwriting 
of American I.G., and much was made of the fact that the bank- 
ing syndicate that floated the debentures was headed by National 
City and included such houses as International Manhattan Co., 
Lee Higginson & Co., Harris Forbes & Co., Brown Bros. & Co., 
and the Continental Illinois Co. 

Still greater acclaim was accorded the prominent Americans 
whose names appeared on the board of directors of this new symbol 
of Germany's friendship for the United States. Listed in the pro- 
spectus and in the newspaper advertising were Walter C. Teagle, 
Charles E. Mitchell, Edsel B. Ford, Paul M. Warburg, William E. 
Weiss, Adolph Kuttroff, and Herman A. Metz. 

The three other directors were Carl Bosch, listed under the im- 
posing title of "Professor Doctor," Dr. Hermann Schmitz; and Dr. 
Wilfrid Greif . 

Dr. Hermann Schmitz, president of the unheralded I.G. Chemie, 
was also the first president of the widely publicized American I.G., 
and soon after its successful financing the campaign to conceal the 
ownership of American I.G. began in earnest. In October 1929 ( as 
already related in Chapter n) Herman Metz started the ball roll- 
ing by his public statement that although Farben was a stock- 



no TREASON'S PEACE 

holder in American I.G., the latter should not be referred to as 
the American branch of the German I.G., because that was just 
not so. Some three months later, while testifying before the Senate 
Lobby Committee, Metz again denied the Farben ownership: 

The Germans haven't got a dollar's worth of stock in the 
American I.G., of record; nor the Swiss, either. 

Finally Metz gave the whole thing away when Senator Robin- 
son stated: 

Now, it is pretty clear that the American I.G. was organ- 
ized by the German I.G., and that they both are officered by 
the same people, and therefore are practically the same con- 
cern. 

Mr. Metz replied: 

Well, that can be so construed, but the reason for it was 
to take over what the Germans had or were trying to do in 
this country, and get the industry established, which I always 
preached to them, to come over here and manufacture over 
here. 

The Geheimrat Dr. Hermann Schmitz, along with Prof. Dr. 
Carl Bosch and the other Farben executives, did everything in his 
power to hide Farben's control of the new holding company in the 
United States. The Geheimrat even tried to pull the wool over the 
eyes of the two duPont representatives who visited him in Berlin 
in July, 1933, to discuss the possibility of exchanging some duPont 
investments in Farben for shares in either I.G. Chemie or in the 
American I.G. The growth of nationalism, the Wilmington execu- 
tives naively explained, made it advisable for their company to 
get rid of its interests in Farben. 

Dr. Schmitz opined that such a horse trade was impossible and 
solemnly stated that I.G. Chemie was strictly a Swiss company, 
and that Farben owned not a single share. 

The duPont officials were not impressed with the truthfulness 
of Dr. Schmitz's statements and reported to the home office that 
they presumed Farben had a dummy Swiss director in I.G. Chemie. 



TREASON'S PEACE 111 

They also reported that in London an official of Imperial Chemical 
Industries told them definitely that the Geheimrat had lied to them. 

In 1934, Mr. Teagle decided that he had better resign as director 
of American I.G. Chemical Corp., but, instead of exercising his 
own discretion and resigning, he cabled his subordinate, Frank 
Howard, who was in Paris, to find out whether he should take up 
the matter with Dr. Bosch, or whether Howard would ask Mr. 
Schmitz about it. 

Howard cabled back on November 29th, that Teagle take a 
firm stand with Dr. Bosch, and stated that the resignation was 

certainly wise under present conditions since it will 

tend minimize chauvinistic comments in both countries should 
there be any public interest aroused in the relations of the two 
companies. 

However, Mr. Teagle did not resign as director of American I. G. 
Both Bosch and Schmitz refused their permission, despite a rather 
pathetic letter dated June 6, 1935, in which Mr. Teagle begged Dr. 
Schmitz "to permit Mr. Clark (a Standard vice-president) to re- 
place me on the board." 

The Hitler regime in Germany had aroused some official inter- 
est at Washington in American companies with German ties, and, 
in 1938, the Securities and Exchange Commission decided to go 
through the motions of investigating the ownership of American 
I.G. 

In its preliminary exploration of the records, the S.E.C. dis- 
covered that although Farben was never to be a record shareholder, 
a resolution was adopted at the first board meeting of this "Ameri- 
can" company, before the public had bought its stock, by which 
the officers were authorized to loan any part of its funds to either 
Farben or to I.G. Chemie. 

At that same meeting, the sum of $10,000,000 ostensibly trans- 
ferred to the United States by Edward Greutert & Cie., Farben's 
Swiss bankers, for the purchase of voting shares in the new com- 
pany, was adroitly switched back to Farben as a loan from the 
new American I.G. That ten-million-dollar silver spoon from 
Grandpa Farben never entered the new infant's mouth it got 
only a book entry on its birth certificate. 



na TREASON'S PEACE 

This ingenious method of tapping Wall Street was worked 
overtime and, within a few weeks after the public had planked 
down its cash, nearly $20,000,000 of American I.G/s capital funds 
had been transferred, by vote of its directors, to Switzerland or 
Germany as loans to Farben. 

The S.E.C. accountants also uncovered data which established 
nominal stock control of American I.G. by Swiss I.G. Chemie 
from the date of organization. This condition had never changed 
and, at the time of the investigation, I.G. Chemie held nominal 
control of more than 85 percent of the shares of American I.G. 

With these facts established, Mr. Teagle was called to the wit- 
ness stand and sworn to tell the truth, the whole truth and nothing 
but the truth. Unhappily, however, he did not know who owned 
control of American I.G. the company of which he was a director. 
More, he had never known, from the day the company was organ- 
ized. He did not know who owned the little block of 500,000 shares 
of the company stock that had been issued in his name stock 
worth at least half a million dollars. He did not know how 
many shares I.G. Chemie owned, or who owned I.G. Chemie. 

It was just too bad, but Mr. Teagle really could not tell to 
the S.E.C. things about the company which no one had ever 
told him. 

Mr. David Schenker, chief attorney for the S.E.C., was ex- 
quisitely polite in his questioning. After some discussion of the 
snake-swallowing act by which American I.G. and Swiss I.G. 
Chemie purchased each other's shares, the question was asked: 

SCHENKER: So that you have a situation where the American 
I.G. Corporation, the control of which is unknown to us, 
is buying over a period of one year approximately $21,- 
000,000 of the stock of this I.G. Chemie Corp., the control 
of which is unknown to us and to you; is that not so? 

TEAGLE: That is correct. 

SCHENKER: So far as you know, you do not know the exact 
extent of the control of the I.G. Chemie in American I.G. 
Corporation; is that true? 

TEAGLE: That is correct. 



TREASON'S PEACE 113 

SCHENKER: And you do not know at the present time who 

controls that corporation? 
TEAGLE: That is correct; yes. 

The examiner's queries continued to be approved by Mr. Teagle. 

SCHENKER: Throughout your entire tenure of directorship you 
say you did not know who the controlling owners of Ameri- 
can I.G. Chemical Corp. were? 

TEAGLE: That is correct. 

On the little matter of 500,000 shares. 

SCHENKER: Now, the record discloses that 500,000 common 
shares were issued to you. Were you the beneficial owner 
of those shares? 

TEAGLE: I was not. 

SCHENKER: Do you know how it was that those shares got 
into your name? 

TEAGLE: No, I do not. 

When asked whether he thought that his colleague on the board, 
Mr. Edsel Ford, might be better posted than he was, Mr. Teagle 
expressed the opinion that Mr. Ford did not know any more about 
it than he did. Teagle also stated that he did not know who was 
voting for him at the stockholders' meetings. 

When asked to express an opinion as to whether all this was 
a healthy condition, Mr. Teagle begged to be excused from 
answering. 

One thing Mr. Teagle could explain. He recalled distinctly 
that he went on the Board at the request of his friend Dr. Bosch: 

My connection with the American I.G. came about through 
an explanation made to me by Dr. Bosch of the German I.G. 
of his plans, and my interest was prompted by the fact that 
I hoped to secure for the Standard Oil Co. of New Jersey 
a supply of the raw product for the fertilizer plant. 

Just how his American I.G. directorship was to help supply 
Standard Oil's proposed fertilizer plant with raw products, while 
he was voting for loans to Farben, Teagle did not explain, neither 
did he mention the efforts he had made to resign from the board. 



ii4 TREASON'S PEACE 

Another matter which Mr. Teagle neglected to mention was a 
letter which he had received back in 1932 from Dr. Wilfrid Greif , 
the managing director of Farben. Written on the letterhead of the 
American I.G. Chemical Corp., 521 Fifth Avenue, New York City, 
and dated May 6, 1932; the letter read, in part: 

I.G. Chemie is, as you know, a subsidiary of I.G. Farben, 

organized in 1928 As officially stated in the annual 

report of the I.G. Farben for 1931, the net income of I.G. 
Chemie for 1931 is sufficient to pay on its stock the same 
dividend which will be paid by I.G. Farben. 

Another item of possible pertinency to the S.E.C. inquiry 
which was not brought out in the Teagle examination, was the 
fact that Standard Oil had decided not to be identified publicly 
as a stockholder in American I.G. This had been the subject of a 
cable sent to Teagle by Mr. Howard on May 27, 1930, when the 
former was in London: 

In view of fact that we have repeatedly denied any financial 
interest in American I.G. it seems to me to be unwise for us 
to now permit them to include us as stockholders in their 
original listing which is object of present transaction. It 
would serve their purpose to issue this stock to you person- 
ally Will this be agreeable to you as a temporary 

measure? 

Mr. Teagle, or the S. E. C. investigators, might also have dug 
up correspondence which passed between Teagle and Mitchell 
back in 1932, when those two American I. G. directors for a time 
opposed the action of the board in swapping Farben securities 
for those of the I.G. Chemie. 

One of these letters, dated May 27, revealed the existence of 
a contract, or option through which Farben might completely 
absorb I.G. Chemie by exchanging its own shares for those of 
the Swiss company. Mr. Mitchell's letter to his friend Teagle went 
on to say that: 

Professor Bosch and Dr. Schmitz should thoroughly under- 
stand how anxious we are to be of assistance to them in 



TREASON'S PEACE 115 

bringing about a development of the chemical industry along 
most approved lines in the United States, but they should 
realize just as fully the fact that you and I are in a very em- 
barrassing situation whenever transactions are proposed as 
between the German I.G. and the American I.G. 

Finally, there was the letter which Mr. Teagle wrote to Mr. 
Mitchell on May 26, 1932, enclosing a memorandum which he 
stated had been prepared at his direction to be used in discussions 
with Dr. Bosch about the exchange by American I.G. Farben 
securities for those of I.G. Chemie. 

It might appear from two statements of fact in the memorandum 
that Mr. Teagle had already reached a very definite conclusion 
regarding the ownership of both American I. G. and I. G. Chemie. 
The statements were; 

The transaction between American I.G. and the I.G. parent 
company involving the exchange of I.G. bonds against the 

I.G. Chemie shares 

Transaction between parent and subsidiary company like 
that of the exchange of I.G. bonds against the I.G. Chemie 
shares 

It may be assumed that if Mr. Teagle's testimony before the 
S. E. C. had been more informative, Mr. Schenker might not have 
felt it necessary to also summon Messrs. W. H. Duisberg and 
D. A. Schmitz. 

Mr. Duisberg qualified as director, first vice-president and 
treasurer of American I.G. and stated solemnly that he didn't 
know who owned it. He then produced correspondence which he 
had conducted with Farben and with Edward Greutert & Cie., 
bankers of I.G. Chemie, at the request of S.E.C., requesting them 
for information about who was which and which controlled whom? 

Farben's reply dated August 13, 1937, was brief and to the point: 

We have no direct or indirect participation either in the 
American I.G. Chemical Corp., nor in the other corporations 
mentioned in your letter (I.G. Chemie and other stock- 
holders of record). 



n6 TREASON'S PEACE 

This letter added that it was not Farben's custom to give such 
information, so no precedent was to be established in making 
the exception; also that the letter was to be treated as confidential. 
Greutert's response was a rebuke for making so unethical a re- 
quest of a banker about its clients. On August 18, 1937, Greutert 
wrote: 

We regret not to be in a position for reasons of principle, to 
give you the requested information. Such a disclosure by us 
would be entirely irreconcilable with the bank secret, particu- 
larly strictly observed in our country by the banking com- 
munity, and with the duties and practices resulting there- 
from. 

(It is of interest here that the so ethical Greutert & Co., and 
Edward W. Greutert, head of this Swiss banking firm, were among 
those named as co-conspirators, along with various officers, sub- 
sidiaries and affiliates of Farben, in the indictment of September 
1, 1939, for conspiracy with Farben's international nitrogen cartel 
which restricted production of nitrogen and ammonia. This dis- 
tinction did not cause either co-conspirator Greutert or any of 
those indicted any real trouble because this multiple indictment 
was one of those nolle pressed by a complacent Department of 
Justice. ) 

Also called to testify by the S.E.C. was D. A. Schmitz, brother of 
Dr. Hermann (the Geheimrat) Schmitz, who added his bit to this 
fantastic, corporate merry-go-round. After qualifying as a director 
of American I.G. since 1933, and its president since 1936, he was 
asked by Mr. Schenker: 

Do you know who was the beneficial stockholders 

of the class A and class B stock of American I. G. Chemical 

Corp.? 

SCHMITZ: No, no more than the records we have here. 
SCHENKER: So the only thing you know is who the record 

holders are and whether they are the beneficial owners or 

not you do not know? 
SCHMITZ: No. 



TREASON'S PEACE 117 

Perhaps the crowning gem of the hearing was the tribute paid 
to the witnesses at its close. Said Mr. Schenker: 

I would like the record to indicate we are appreciative of 
the full cooperation that was given to us in connection with 
our study of the American I.G. Chemical Corp. and that 
they have made available to us all of the information we 
asked. 

Some mention having been made in the press of the acarpous 
nature of the public hearing, I wrote to the S.E.C., offered my 
services, and enclosed various papers, one of which was a copy 
of the diagrammatic chart I had prepared in 1931 for pongress. 
This chart, or flow sheet, set forth in detail what Farben was 
doing and proposed to do in this country through its control of 
American I.G. Chemical Corp., and other United States companies. 

My letter to the S.E.C., dated Feb. 5, 1938, and addressed to 
the Chairman, Hon. William O. Douglas (made Supreme Court 
Justice in 1939), stated in part: 

Having noted in the press that you are having difficulty in 
uncovering the identity of those interests which control the 
American I. G. Chemical Corp., due to the unfortunate lapse 
of memory indicated by some of your witnesses, I am enclos- 
ing herewith copies of some papers and documents which may 

assist your investigators my own diagrammatic chart 

or flow sheet was worked out in 1931 with the hope that 
Congressional investigation might be induced into one of the 
most sinister groups which has ever been assembled in indus- 
try, finance, and politics in this country. 

Considerable water has gone over the dam since I put this 
chart together, but in its essential aspects of objective, the 
ramifications and offshoots of this grouping of interests still 
persist. It would be a very valuable public service if your 
investigators should uncover some of its present connections 
and agencies but I suggest you will have to arm them with 
brass knuckles and a sublime indifference to their own future 
welfare if they really dig into it. 

If you feel that I can be of assistance let me know. 



n8 TREASON'S PEACE 

I doubt whether the S.E.C. Chairman ever saw this letter. It 
was acknowledged, however, by Mr. David Schenker, S.E.C. 
counsel, who expressed appreciation for my cooperation, but did 
not indicate a desire for any more of it. 

As an immediate aftermath of the S.E.C. public hearing 
Mr. Teagle's earlier desire to resign as an American I.G. director 
was seconded vigorously by his colleagues, and considerable indig- 
nation was expressed at the embarrassment to which both Mr. 
Teagle and Standard Oil of New Jersey had been subjected. Stand- 
ard Oil was not amused! And a memorandum by one of the Stand- 
ard Oil staff, uncovered later in Mr. Teagle's files, contained these 
statements: 

The commission wants to know the true foreign ownership 
since American I.G. is a chemical company. In case of any 
war anywhere this ownership would be wanted by the United 
States Government. 

Mr. Wellman (Standard Oil attorney) explained to Mr. 
Schenker that any conclusion by the Commission that Ameri- 
can I.G. is, or is possibly, owned by I.G. Farben or allied 
interests may well result in an ownership by the German 
Government with all the attendant risks to the American 
owners of the twenty-five million of American I.G. deben- 
tures. 

It is a real possibility that if, in another war, Germany and 
U. S. A. should again be enemies the non-German financial 
interest in American I.G. shares would have to be shown to 
the satisfaction of the U. S. Government to escape seizure 
as German-owned property. 

Mr. Teagle as a director was placed in a most embarrassing 
position at the hearing and also in press releases because he 
did not know the beneficial ownership of any of the large 
blocks of American I.G. shares. To the public, at any rate, 
it seems impossible that a man in his position would not 
know something as to who owns the company. 

"For Duisberg and Schmitz to say in effect that they knew 
nothing about the holdings of this company, and that they 



TREASON'S PEACE 119 

had made the investment entirely on the recommendation of 
Dr. Schmitz, is just a plain dereliction of their duty as direc- 
tors. 

It seems to us also that the best thing Mr. Teagle can do is 
to resign from the American I.G., for, while the present 
inquiry, I believe, is closed, we have certainly not heard the 
last of it. It may be contended that the S.E.C. is poking 
into things that are none of its business, but after all, they 
take the attitude that the company raised $30,000,000 from 
the American public and they have a right to know what 
has been done with this money. 

The pithy comment on various aspects of the S.E.C. hearings 
was unsigned, but some of the writer's forebodings about war and 
the seizure of American I.G. as German owned were to come 
true. He was correct also in his forecasts that the S.E.C. inquiry 
was closed, but that Standard had not heard the last of it. 

Mr. Howard wrote Standard's European representative on Feb. 
19, 1938, that "a very unfavorable impression" had been created 
by newspaper reports of Mr. Teagle's apparent lack of any real 
knowledge of the ownership or business of the company of which 
he was a director, and in which the records indicated he had 
500,000 shares. 

"I am afraid," the letter continued, "that one of us or both 
of us will have to have some pretty straight talk with Geheimrat 
Schmitz about this American I.G. Chemical business." 

Apparently, however, it was the Geheimrat who did the straight 
talking, when Howard rushed to Berlin to see him. For, in a letter 
dated March 11, 1938, Mr. Howard reported to Teagle that he 
was doubtful that Dr. Schmitz would consent to the resignation, 
and went on to say that Dr. Schmitz appeared to see no advantage 
in further talk about the matter. Wrote Howard: 

He knows what happened in Washington, and despite every- 
thing he still believes that his course has been the best course 
that could be taken and he wishes to continue it. He has 
pointed out to me, however, reasons why he believes there 
will be no recurrence of any of the past troubles in connection 



i2o TREASON'S PEACE 

with the American I.G. Company. Unfortunately, these are 
matters which I can only talk about when I see you this 
at Dr. Schmitz's specific request. 

The occult powers which Dr. Schmitz indicated relating to 
the non-recurrence at Washington of the troubles of American 
I.G. were never revealed publicly by Mr. Howard, and it is 
worthy of note here that subsequent to the 'inclusion of this par- 
ticular letter in the record of the hearings of the United States 
Senate Committee investigating the National Defense Program 
(Truman Committee) in 1942, Mr. Howard, who had appeared 
as a witness before the committee, was not asked to disclose those 
statements of Geheimrat Schmitz which he had not dared to put 
in his confidential report to Mr. Teagle. Mr. Howard also ap- 
peared later as a witness before the Senate Committee on Patents 
( Bone Committee ) but again failed to relate just what the Geheim- 
rat had said that he could "only talk about" when he saw Teagle. 

Mr. Teagle was not called as a witness before either of those 
Senate hearings. He did, however, finally succeed in his long 
cherished desire to resign from the board of the Farben subsidiary, 
about which, as a witness, he knew so little. On April 4, 1939, 
seven long years after he had first requested permission to resign 
and just a few months before the start of the war, D. A. Schmitz 
wrote Mr. Teagle that his resignation as director had been ac- 
cepted "with regret." 

Brother Hermann the Geheimrat, and Carl Bosch the Profes- 
sor Doctor apparently had instructed D. A. Schmitz to be nice 
about it, and that they could now spare from the board of Farben's 
American I.G. the august name of the chairman of the board of 
Standard Oil of New Jersey. That name had served its purpose 
in the Farben pattern for ten vital pre-war years. 

Apropos of the non-recurrence of troubles for American I.G., 
as foreseen by Dr. Schmitz. the S.E.C. held no more public hear- 
ings on the subject, and issued no public statement about it until 
June 9, 1941. This was a few days after the discerning Lowell L. 
Leake in newspaper PM had published the first informative article 
which ever appeared in the press about my earlier protests at Far- 
ben's activities in the chemical industries of this country. 



TREASON'S PEACE 121 

The S.E.C. statement took the form of a report to Congress. 
In this report of its four years of lethargic efforts to uncover the 
ownership of American I.G., the S.E.C. included the following: 

All attempts to ascertain the beneficial ownership of the 
controlling shares have been unsuccessful As a conse- 
quence the American investors, mainly bondholders, are in 
the peculiar position of being creditors of a corporation under 
an unknown control. 

A few days later I prepared an analysis of that report for the 
Non-Sectarian Anti-Nazi League which in part was as follows: 

The monkey in the box and circus merry-go-round of con- 
cealed stock ownership fools only those individuals who want 
to be fooled, or who are willing for some reason to play a 
part in the attempted deception. Unhappily an agency of 
the United States Government has now issued an official re- 
port or presentation, which, when we finally get to the point 
of seizing enemy property, as we must, will provide a docu- 
ment to be utilized as a pretext to permit the German I.G. 
Farben to continue its operations in this country, under the 
present management, and in the interest of the German 
Reich. 

A year later I made one more attempt to induce the S.E.C. to 
reopen its inquiry into other ramifications of the activities of I.G. 
Farben and its agents and affiliates in the United States. In a com- 
munication dated August 8, 1942, I called attention to the fact 
that during the earlier period of its American I.G. investigation 
it had been rumored that Earle I. McClintock, high official of 
Sterling Products, was being considered to succeed Messrs. Joseph 
P. Kennedy and William O. Douglas as chairman of S.E.C. when 
those two gentlemen resigned that office in 1937 and 1938 re- 
spectively. I pointed out that regardless of the fact that Mr. Mc- 
Clintock was not made chairman, any attempt to secure his ap- 
pointment became a matter which the S.E.C. might properly 
inquire into in view of the Sterling and Farben secret agreements. 
Again the S.E.C. declined to follow my suggestion. 

The S.E.C. report on the lily-white purity of American I.G., 



122 TREASON'S PEACE 

as submitted to Congress, was prepared under the supervision of 
Commissioner Robert E. Healy, assisted by the gentle Mr. Schen- 
ker, as counsel. 

In the past I had made other appeals to agencies advised by 
these two distinguished public servants. In 1929, when Mr. Healy 
was chief counsel for the Federal Trade Commission, I requested 
an investigation of the German affiliations of American I.G., Drug, 
Inc., and the American Medical Association. And two years later, 
I again asked that agency to dig into the McKesson & Robbins 
mess. Mr. Schenker's first job in Washington was assistant to Ferdi- 
nand Pecora, counsel for the Senate Committee on Banking and 
Currency, which drafted the S.E.C. legislation. And it was this 
committee that ignored my appeals to explain the New York Stock 
Exchange listing of the fraudulent McKesson & Robbins securities, 
and also to investigate what I described as "a reign of terrorism 
utilized by our so-called financial leaders to cow into sub- 
mission any one who protested against the prostitution of our 
governmental machinery at Washington." 

Messrs. Pecora and Healy became members of the S.E.C. when 
it was organized in 1934, and Mr. Schenker became its counsel. 

On June 11, 1941, just two days after the S.E.C. report on Far- 
ben's American front was filed with the Congress, Mr. Schenker 
retired as its counsel and returned to the private practice of law 
in New York City. 

When the war started in Europe, Farben decided that it might 
be wise to do a little face lifting on its American offspring. So, on 
October 30, 1939, the directors of the American I.G. Chemical 
Corp. announced that there was no longer an American I.G. be- 
cause one of its subsidiaries, General Aniline Works, had first 
absorbed it and then had changed its own name to General Aniline 
& Film Corporation. Just like that. How could it be related to 
German I.G. when the I.G. had vanished from its name. 
There would be no change, it was announced, in the management 
but the offices were to move from Fifth Ave. to Park Ave. Careful 
in small details, Farben was moving its renamed child from the 
too close environment of other Farben subsidiaries, which still 
occupied offices at the old Fifth Ave. address. 

Despite the unhappy experiences of Mr. Teagle as an American 



TREASON'S PEACE 123 

I.G. director, Standard continued its intimate relations with Far- 
ben and permitted its vice-president, E. M. Clark, to remain as a 
director of American I.G., or General Aniline & Film, until 1940. 
Standard also took part in several sizeable financial negotiations 
with Farben, one of which, in 1940, involved a Standard proposal 
that Farben exchange its interest in General Aniline & Film for 
Standard's oil-refining properties in Germany. In reply General 
Aniline's New York management solemnly informed Standard that 
Farben had no interest in it or in any other American properties; 
and then, by way of proof, arranged a conference in Switzerland 
at which representatives of the three companies met. 

The real purpose of this conference came out when Farben and 
its American front both suggested that Standard purchase control 
of General Aniline & Film from its Swiss "owners." This would 
make everybody happy and prevent any possibility of General 
Aniline & Film getting into a jam with the United States Govern- 
ment. Standard, for some reason, did not bite on that one. 

Some months later Mr. Hugh S. Williamson (prominent mem- 
ber of the New York law firm of Breed, Abbott and Morgan, also 
vice-president and treasurer of General Aniline & Film), was in 
Europe discussing matters with the home office. Possibly Mr. 
Williamson feared that the S.E.C. whitewash might not stand 
exposure to the stormy weather in prospect, and that the Farben 
name might show through on the General Aniline signboard. In 
any event, late in October, 1940, Mr. Williamson put in a New 
York call from Switzerland for his friend Mr. Orville Harden then 
vice-president of Standard and, as a representative of Farben, 
asked whether Standard would not like to sell Farben its very 
valuable Hungarian oil properties. 

Standard by then was more than willing to get some of its 
assets out of Europe and suggested a price of $30,000,000 as about 
right. Farben declined with thanks and, after protracted negotia- 
tions, came back with a counter offer of $24,000,000, mostly in 
cash but including a note for $5,000,000, which was to be secured 
by collateral in the form of a lien on Farben's American proper- 
ties (which it had just denied owning) and was to be payable 
"three months after the end of the war." 

Standard's directors bit at this last offer; took it to Washington 



124 TREASON'S PEACE 

and secured the approval of the State Department (so they said) 
but the chief counsel for the Treasury, and Vice President Henry 
A. Wallace, as chairman of the Board of Economic Warfare, re- 
fused official permission. This was in August, 1941; by this time 
Farben's tie-ups with American war industries were beginning 
to receive some rather critical public attention, and the atmosphere 
in official circles was a bit thick when anything relating to Farben 
came up. 

While the S.E.C. staff was still fabricating its conclusion that 
American I.G. was nullius filius, several other branches of the 
Government refused to accept the theory of illegitimate Swiss 
parentage, and concluded that American I.G. actually meant 
German I.G. Among those who discredited the woods-colt story 
were members of the Antitrust staff of Assistant Attorney General 
Thurman Arnold, who had uncovered evidence of the Farben 
pattern in investigations of some of its tie-ups in the synthetic 
nitrogen-ammonia field, and in the magnesium industry and had 
instituted actions accordingly. 

And, on April 10, 1941, the Antitrust Division issued subpoenas 
calling for the complete records of General Aniline, Winthrop 
Chemical, and Sterling Products. Then began the sort of dragnet 
investigation into the ramifications of Farben's affiliates and per- 
sonal agents in this country that I had first asked the Department 
of Justice to make thirteen years previously, in 1928. 

There was consternation in the ranks of Farben's New York 
and Berlin offices when word of those subpoenas reached them. 
The management of General Aniline at first declined to comment 
publicly; later a press statement was issued which read: 

The officers of General Aniline & Film Corporation stated 
that the report it was among the companies whose books and 
records had been subpoenaed in connection with the Govern- 
ment's investigation of the drug and pharmaceutical trade 
was an error. 

It was an error all right, a very bad error on the part of Dr. 
Schmitz who had assured Standard Oil's Frank Howard that there 
would be no recurrence at Washington of the past troubles of 
American I.G. 



TREASON'S PEACE 125 

Three weeks later came another blow for Farben's "American" 
citizens. On May 1, 1941, the British Minister of Economic War- 
fare, Dr. Hugh Dalton, threw some very pointed comments about 
conditions in the Western hemisphere into an informal statement 
which he made to American correspondents in London. The gist 
of these remarks was cabled to the United States and received 
considerable publicity in the press. They reflected a very natural 
feeling of irritation in the British Cabinet at the fact that Farben's 
affiliates in the United States were helping effectively to nullify 
the British Navy's blockade of Germany's export trade by shipping 
American-made dyes, drugs, and chemicals to Farben's agents in 
Latin America, and thus helping Farben to hold its trade and to 
finance German propaganda and espionage in those countries. 

Dr. Dalton suggested that the United States, for its own pro- 
tection and security, might well follow Britain's example by freez- 
ing the assets of Axis countries and by blacklisting all concerns 
whose profits were being utilized to finance Nazi activities in the 
Western Hemisphere. 

The Minister named some of the German-controlled companies 
in the United States that had been carefully organized before the 
war to supply the requirements of German agencies in South 
America when Britain should shut off their supply of products 
from Germany. 

Among the most important of these companies was General 
Aniline & Film, which was supplying Farben's Latin American 
agents with dyes, photographic materials and other products, ship- 
ping them through General Dyestuff or other companies acting 
for it. Sterling Products was also branded and Messrs. Weiss and 
McClintock were named in person by Mr. Dalton for similar of- 
fenses. 

There were immediate repercussions of this blast at Farben's 
American front. The American patriots who sat in the New York 
office of General Aniline promptly issued another chapter of the 
bedtime story of their firm's parentage. They denied emphatically 
the allegation of the British Ministry that it was owned or con- 
trolled by I.G. Farben, which has "no interest, direct or indirect, 
in or control over the affairs of General Aniline & Film Corpora- 



126 TREASON'S PEACE 

tion." They were not acting for Farben or in its interest in export- 
ing merchandise," etc., etc. 

One of its officers was interviewed by The New York Times at 
his home in Englewood, N. J. This was Dr. Rudolph Hutz, General 
Aniline's vice-president who, in World War I, was an official of 
the Bayer Company and had been arrested and interned in 1918. 
When asked about this incident by the Times he treated it lightly 
and described the arrest as "a so-called Presidential warrant a 
purely formal charge of the Alien Property Custodian." 

Dr. Hutz also stated that he knew nothing about any relations 
between General Aniline and Farben. However, that gentleman's 
peculiar lack of knowledge about such things did not save him, 
seven months later, from being named as a co-conspirator in an 
indictment against General Aniline, Farben, and his earlier em- 
ployer, Bayer. 

The United States Government was prompt to take the hint 
from the British Minister's blunt remarks, and things started to 
happen. On May 9, 1941, Attorney General Robert H. Jackson 
attached about $250,000, which was on deposit in the account of 
I.G. Farben in the National City Bank of New York. An order 
was secured from Federal Judge John C. Knox directing the bank 
to hold all funds or credits owing to Farben pending disposition 
of antitrust suits in which Farben, as a defendant, had refused 
to put in an appearance. 

Two weeks later the Justice Department tied up some additional 
funds which were about to be paid to Farben's account by General 
Dyestuff and, following the usual Farben procedure, were in- 
formed by that company's president, E. K. Halbach, that General 
Dyestuff was completely independent, as it was owned 100 per- 
cent by American citizens. 

On June 14, another real blow was dealt Farben when President 
Roosevelt issued an order freezing all funds belonging to Axis 
nationals. 

Mr. Henry Morgenthau, Jr., Secretary of the Treasury, to whom 
enforcement of the freezing was delegated, had long been urging 
that step but, according to press dispatches from Washington, had 
been blocked by the unwillingness of Secretary of State Cordell 
Hull to give the Axis a pretext for reprisals. Our distinguished 



TREASON'S PEACE 127 

Secretary of State apparently did not appreciate the important 
part which Farben played in any decision as to reprisals. 

Secretary Morgenthau, however, was better advised and had 
already expressed the opinion that the delayed freezing action 
would be a matter of locking the stable after the horse was gone; 
but the White House statement indicated that it was also intended 
to curb subversive activities in this country. 

The Treasury regulations included one clause calculated to give 
Farben's American agents a headache; it read that on or before 
July 14 a report should be filed setting forth all information rela- 
tive to property in the United States in which any foreign country 
or national had any interest, direct or indirect. This meant Farben 
patents as well as other Farben property. It also meant that it 
mattered not a bit whether I.G. Chemie was Farben owned or not; 
Switzerland was a foreign country and the General Aniline shares 
were, therefore, to be frozen by the Treasury. Mr. Dalton's brutal 
frankness had turned the tide. The foundations of Farben's frame- 
work in the United States were beginning to crumble. 

On July 17, the President issued another proclamation that hit 
Farben in another highly vulnerable spot. This time the Secretary 
of State was instructed to publish a blacklist of companies in 
Latin America and elsewhere which were affiliated with Axis 
powers. This list included the names of every known agent, affili- 
ate or branch house of I.G. Farben in all of the Latin American 
countries. 

While these storm clouds were gathering about Farben's Amer- 
ican fronts, there came to the rescue one Dr. Werner Karl Gabler, 
who had moved to Washington some years previously as an advo- 
cate of the social and economic policies of the New Deal. Dr. 
Gabler now appeared as an accredited representative of the Swiss 
I.G. Chemie, and approached various government officials with 
impressive looking documents to support his arguments that I.G. 
Chemie was a wholly independent Swiss company. 

According to Time, Dr. Gabler had become well known in 
Washington as an "economist lobbyist" for the American Retail 
Federation and had also done work for the late Edward A. Filene, 
Boston capitalist and department store operator. Be that as it 
may, Dr. Gabler certainly blossomed out in his new role at Wash- 



128 TREASON'S PEACE 

ington. He had secured his assignment through the Swiss Minister 
at Washington, the Hon. Charles Bruggmann. And the fact that 
the Swiss Minister's wife, the former Mary O. Wallace, was a sister 
of Henry A. Wallace, then Vice President, did not detract from the 
prestige and dignity with which Dr. Gabler conducted his efforts 
to checkmate those who were saying, "Why argue any more, seize 
General Aniline and get it over with/' Needless to say neither the 
Vice President nor his sister was involved in aiding the Gabler 
efforts. 

In its article about Dr. Gabler, Time included this comment: 

Some of Dr. Gabler's fellow New Dealers though no more 
anti-Nazi than he, believe he was hired because he had an 
"in" with the New Deal. If that was a Nazi plan, it could be 
an example of the super-ingenuity of Nazi infiltration tactics. 

Economist-negotiator Gabler, to give him a more polite title 
than 'lobbyist/' went about his task with great circumspection, 
he always notified the authorities before he put in telephone calls 
for Switzerland (undoubtedly they were all listened in on any- 
how) and a stage battle of noisy name calling went on between 
him and some of General Aniline's German-born directors. 

Finally, after it appeared fruitless for even a Doctor Gabler to 
gabble any more about I.G. Chemie's being a safe and neutral 
guardian of the General Aniline shares, this New Deal economist 
proposed a new deal for General Aniline an American voting 
trust was to be set up to control the I.G. Chemie shares on which 
a United States Government official and an I.G. Chemie nominee 
should have equal voice. This was rather far fetched as the Gov- 
ernment already had frozen the stock and was about to take over 
the property. 

About this time one Ernest W. Flender, German born share- 
holder in General Aniline, and a member of the private-banking 
house, C. B. Richard & Co., dealt himself into the situation by 
starting a mysterious equity suit in a Delaware Court to secure 
an order compelling a stockholder's meeting. However, the U. S. 
Treasury intervened and the suit was dismissed after Mrs. Dorothy 
Pickhardt Kahle, another stockholder, had been substituted for 
Mr. Flender as the complainant. 



TREASON'S PEACE 129 

The General Aniline directors made many moves on the Wash- 
ington chessboard to strengthen their position. One of these was 
to retain the services (at an annual retainer reported to be $100,- 
000) of former Attorney General Homer S. Cummings, who had 
opened an office for the practice of law in the nation's capital a 
few months before the outbreak of the war. More will appear 
about this later. 

As the date of the declaration of war between Germany and 
the United States drew near, the board of General Aniline was 
in a state of wild confusion. A number of the old German-born 
directors resigned and were replaced by several well known Amer- 
icans who had no prior connection with the company. Finally, 
D. A. Schmitz was asked to resign as president and, when he re- 
fused, the board voted to remove him. For several weeks the 
company had no president. Then, on October 30, 1941, the direc- 
tors elected as president former Judge John E. Mack, of Pough- 
keepsie. The name of Judge Mack, known to be an intimate friend 
and neighbor of President Roosevelt, was calculated to lend such 
an aura of American respectability to General Aniline that this, 
in itself, might prevent actual seizure of the company as enemy 
owned. Judge Mack had had no previous experience as head of 
an $86,000,000 corporation with 6,000 employees. Nevertheless, 
his salary was reported to be fixed at $90,000 a year. Not long 
afterward, on December 5, 1941, another, even bigger, name was 
added to the General Aniline board, through the election of Wil- 
liam C. Bullitt. Mr. Bullitt, however, never actually served, as he 
left that same day for Africa and the Far East, on a personal mis- 
sion for the President. 

This frantic Americanization of Farben's offspring might at least 
have stalled off the seizure had not the Japanese time-table decreed 
otherwise. With the attack on Pearl Harbor the energetic and 
able Assistant Counsel of the Treasury Department, J. J. O'Con- 
nell, Jr., (later to become its chief counsel) moved in on General 
Aniline with a commando squad of seventeen supervisors and took 
over in earnest. Evidently he was not content with previous house- 
cleaning which had consisted in taking a few offensive I.G. 
pictures off the wall and hiding some of the hired help in the 
cellar. 



igo TREASON'S PEACE 

Within a week a New York Grand Jury had returned the three 
indictments already mentioned charging conspiracy by General 
Aniline, Farben, General Dyestuff and several of its officers and 
directors with numerous acts of conspiracy in restricting produc- 
tion of dyes, photographic materials and chemicals, along with 
other violations of the criminal statutes of the United States. 

Two months passed during which Mr. O'Connell and his super- 
visors did some checking up, and then ousted five of the principal 
operating executives of General Aniline, all naturalized Americans 
who were accused of obvious Farben affiliations. 

Meanwhile, Mr. Leo T. Crowley, head of the government- 
owned Federal Deposit Insurance Corporation, and also high- 
salaried president of a public utility company, was offered by the 
President the additional position of Alien Property Custodian. 
However, Mr. Crowley appeared none too anxious to accept this 
responsibility unless complete freedom of action was assured him. 
So Treasury, for a time, remained supreme in General Aniline 
affairs. 

On February 16, 1942, Secretary Morgenthau addressed an 
official notice to General Aniline that he had vested in his own 
name, title to all of the shares of the company listed in the names 
of Geheimrat Professor Dr. Carl Bosch of Ludwigshaf en, Geheim- 
rat Dr. Hermann Schmitz of Berlin, and of the Swiss I.G. Chemie 
or its nominees in Switzerland and the Netherlands. 

Prior to this final seizure of the controlling shares of General 
Aniline, that company, as one of Farben's American dummy fronts 
had controlled not only its own immense war material manufac- 
turing plants, but had also owned huge blocks of stock worth some 
$11,500,000 in the following American Corporations: Standard 
Oil Co., of New Jersey; Standard Oil Co., of California; Standard 
Oil Co. of Indiana; E. I. duPont de Nemours & Co., Sterling Prod- 
ucts, Inc., Plaskon Co., American Magnesium Corp., Alba Phar- 
maceutical Co., and Winthrop Chemical Co. ' . 

What came after February 16, will appear in a later chapter, 
but it was this date which marked the end of the long fabric of 
lies and subterfuge behind which Farben had almost succeeded 
in veiling its identity. Perhaps, more important, it exposed official- 
ly the use which these Teutonic builders of a secret world empire 



TREASON'S PEACE 131 

had made of some of our esteemed citizens and, to quote from a 
later U. S. Treasury Department report, how Farben had: 

been plotting the downfall of the free peoples who gave 

them an opportunity to prosper and grow rich by honest trade 

by control of corporations, by accumulating stocks of 

raw materials, by carefully directed but unlimited bribery, 
by the use of force and threats of force, and by any other 
methods which came to hand. 

Which is a pretty good description of the Farben pattern. 



CHAPTER V I M 



Republicans Open The Door 



ON OCTOBER 20, 

1942, The New York Times published a sensational story about 
a "sealed" gift to the Library of Congress of some nine thousand 
letters comprising the files of the late Edward T. Clark, private 
secretary to President Calvin Coolidge. The story attracted in- 
terest because it stated that these files had been advertised to be 
sold at public auction on Oct. 28 at the Parke-Bernet Galleries 
in New York City, but instead were suddenly withdrawn from 
sale and presented to the nation by one Charles Kohen, proprietor 
of the Hobby Shop of Washington, D. C., who had secured the 
files from Clark's widow. 

The Times article stated that the correspondence covered ten 
years, from 1923 to 1933, which period included part of the time 
Clark spent with President Coolidge at the White House. It was 
also stated that the catalog listing of the letters classed some of 
them as sensational. 

What the Times article did not reveal, however, was that Edward 
Terry Clark, or Ted Clark as he was known in Washington until 
his sudden death in 1935, was not only personal secretary to Presi- 
dent Coolidge until March 4, 1929, but that immediately after that 
132 



TREASON'S PEACE 133 

date he became Washington representative of Drug, Inc. Clark, 
with the title of vice-president, was in charge of "government re- 
lations" from then until 1933 when Drug, Inc. was unscrambled, 
and Sterling returned to its earlier status as the Farben partner 
in the patent medicine industry. Drug, Inc., it will be recalled, 
was the tie-up of Sterling and the Louis K. Liggett group in 1928 
which later took in Bristol Myers, Vick, Life Savers and other 
large national advertisers. 

Ted Clark was, in plain English, a Washington lobbyist, main- 
tained at the national capital in the interest of Farben's original 
postwar tie-ups in the drug industry, which tie-ups ten years later 
were admitted by all concerned (excep f Fctrben) to have been 
illegal from the day on which they were first entered into. After 
Clark left the President of the United States his boss was William 
E. Weiss, senior vice-president and general manager of Drug, 
Inc., who, some twelve years later, was to be prosecuted and fined 
under a federal criminal statute, and forced out of Sterling be- 
cause of what the United States Treasury termed his "undesirable" 
relations with I.G. Farben in the latter's "plotting of the downfall 
of the United States." 

The Times story also neglected to mention that in August, 1932, 
when Herbert Hoover was running for reelection as President 
against Franklin D. Roosevelt, his White House secretary, the 
late Thomas G. Joslin, went off on a vacation and Mr. Hoover 
"borrowed" Ted Clark from Farben's Drug, Inc. Thus Mr. Clark 
became the official secretary to the President of the United States, 
while Drug, Inc., agent of Farben, continued to pay his salary 
as though no interruption had occurred in his services as its Wash- 
ington representative. (And perhaps none had.) 

At the time, this incident created something of a stir. It was 
too much for the New York World-Telegram's usually sweet-tem- 
pered Raymond Clapper, who described the temporary secretary 
to Mr. Hoover, as a "lobbyist whose salary was paid by Drug, Inc." 
Editorially the World-Telegram commented that, "the President 

must be very insensitive" "Much more than the vagary of 

Hooverian taste is involved." 

The day after the Times first published the story of the sudden 
decision to get these Clark files under lock and key, the New York 



i4 TREASON'S PEACE 

Herald Tribune still further whetted the curiosity of those who 
knew of Clark's activities by quoting Mr. Kohen as having said 
that the files included correspondence with Col. William J. Dono- 
van, who was Assistant Attorney General during the Coolidge Ad- 
ministration; Charles D. Hilles, member and former chairman of 
the Republican National Committee; and others. Also that there 
were letters pertaining to South and Central American countries, 
and that it would be a terrible thing if German agents got hold 
of them. 

The description of these files printed in the Parke-Bernet cata- 
log is intriguing in its implications. Whoever wrote it would seem 
to have examined the files carefully and to have had a deft sense 
of the value of spicy historical documents: 

They provide an insight into the political workings of offi- 
cial Washington and much important information of a 

private nature on various public ancj political matters 

The correspondents are persons of note, including members 
of Congress, governors of states, government officials, busi- 
ness men, financiers, personal friends, politicians, and others 
in various walks of life. The letters pertain to matters of gov- 
ernment, public works, political matters, etc. Some of the 
letters may be classed as sensational; they reveal the work- 
ings of a political machine. The writers seek legislation in 
favor of their business, seek appointments to positions for 

friends of the Republican party Another folder contains 

correspondence between Mr. Clark and the holder of an 
important office during the Coolidge Administration, and who 
has been appointed by President Roosevelt to a high govern- 
ment office since the outbreak of the present war on 

political and private matters. 

With regard to those letters referred to in the catalog as having 
been written by seekers of official favors, it should be recalled 
here that in the case of such "favors" as may have related to the 
affairs of Sterling, Bayer, and Winthrop, these companies had 
clauses in their contracts which stipulated that Farben would 
share in their expenses. The possibility of Farben thus having been 
charged its proportionate share 'of Clark's salary while he was 



TREASON'S PEACE 135 

"Acting Secretary" of the President of the United States, is not 
edifying. 

However, to return to the story of the aborted auction of the 
files. Several months after they had gone to their Congressional 
guardians, I had the pleasure of meeting Mr. Kohen. His little 
Hobby Shop is just around the corner from the White House, on 
17th St. near Pennsylvania Avenue; its windows and the counters 
and cases inside display autographed letters, historic documents, 
stamps, coins and medals. Its proprietor told me a dramatic story. 

As soon as the story of the Clark files was published, fantastic 
things began to happen. In one instance an imposing-looking in- 
dividual came into the shop, while two other men stationed them- 
selves outside the door. His visitor, who gave no name, was brief 
and to the point. He merely announced that he had come to get 
the Clark files, and had brought with him $100,000 in cash as 
purchase money. When Mr. Kohen refused this bizarre sum, his 
mysterious customer denounced him as a fool, and departed with 
his little black bag. 

Mr. Kohen had another visitor, this one a gorgeous young lady 
"and I mean gorgeous," he assured me who came into the shop 
and wanted to know whether a certain gentleman had written any 
of those letters to Mr. Clark. On being told that he had, the young 
lady informed Mr. Kohen that she would take those particular 
letters at his, Mr. Kohen's price. Again the offer was rejected. 

The high point in Mr. Kohen's story was the reason he gave 
for donating the files to his country. "As a veteran of the last war/' 
he said, "I feared that if I let the auction go through, a German 
agent might get the files, destroy those which were objectional 
to the Nazi cause, and make use of other letters to embarrass our 
present war effort." 

After I first heard the story, but before I met Mr. Kohen, I sug- 
gested to government authorities that in view of my own knowl- 
edge of Clark's activities, an official examination should be made 
of this correspondence. So far as I can learn this was not done. 

That suggestion was by no means my first effort to induce official 
Washington to look into the lobbying activities of Mr. Clark. In 
December, 1929, 1 had written to the late Thaddeus H. Caraway, 
asking that his lobby committee question Mr. Clark about the 



136 TREASON'S PEACE 

connection between Drug, Inc., and I.G. Farben. I also called 
the Senator's attention to the fact that a few years back, Secre- 
tary of Commerce Herbert Hoover had appointed what he called 
a Chemical Advisory Committee to help him decide what to do 
about the encroachments of I.G. Farben; and that some of the 
individuals who had been appointed to that committee were under 
the influence of that same German combine. 

With that letter I enclosed a reprint of an editorial from the 
publication Chemicals of May 13, 1929, entitled "Does the Ameri- 
can Chemical Industry Need Guts/' Senator Caraway never ac- 
knowledged either the letter or the editorial. The editorial was 
written by my good friend Sidney W. Dean, Sr., one of the few 
writers in the chemical industry who did not hesitate to express 
publicly, what was said privately by substantially all of his less 
robust colleagues when the subject of Farben came up. 

That reads in part as follows: 

Several weeks ago. through the financial pages of the met- 
ropolitan press, it was announced that a banking group, 
headed by the National City Bank of New York, was offering 
$30,000,000 in guaranteed 5%% debentures of what-the 
American I.G. Chemical Corporation. This American (?) 
annex to the German dye and chemical cartel the Interessen 
Gemeinschaft Farbenindustrie Aktiengesellschaft of Frank- 
fort-on-the-Main in Germany proposes to manufacture in 

America such chemical and dye products as synthetic 

gasoline and motor fuels, products from the hydrogenation 
of coal, dyestuffs, synthetic fertilizers, artificial silks, and 
solvents and lacquers. While not so stated, this new colossus 
with a German accent will also manufacture and vend medi- 
cinals, pharmaceuticals, photographic chemicals, biological 
stains, etc 

It is an amazing program yet the most amazing thing 
about it is the roster of American business men announced 
as affiliated with it as executives and as directors 

Now, what is this $30,000,000 for? Simple enough when you 
stop to think it over for the acquisition of stocks of certain 
prominent American chemical companies already deeply 



TREASON'S PEACE 137 

attached to the I.G. by agreement or friendship or relation- 
ship, or patent agreement, or what have you, by filaments so 
fine as to be almost invisible to the general public and chem- 
ical buyer of this country, and yet as strong as steel 

Is there to be repetition of the cut-throat tactics existing 
before the War in the battle for dye and chemical markets, 
not only in the United States but in Central and South Amer- 
ica? 

Are we to again see the source of our explosives (for every 
dye laboratory is a potential arsenal) under the dexterous 
thumb of gentlemen wearing honorary degrees from Cologne 
or Heidelberg or Berlin? 

Shall our recent discoveries in the realms of film and pho- 
tographic chemistry; in serums and stains, in pharmaceuticals, 
synthetics, lacquers and solvents, be gathered into a mighty 
merger under the shadow of the world's most grasping and 
most powerful cartel? 

Dare we, realizing that mergers and trusts cannot be oper- 
ated legally in this country with foreign control, insist that 
the actual ownership and direction of such new mergers as 
shall appear from now on in the field of chemistry and allied 
industries be probed to the last proxy in the safe deposit 
vaults of Wall Street or the depositaries of the I.G.? 

Have the American chemists and chemical producers and 
dye makers and distributors the guts, as we have so expressed 
it, to fight this new battle to a finish so that we may know 
now and in the future into just what pockets and just what 
coalitions the products of American plants and laboratories 
are descending? 

Have the American chemists forgotten just how and where 
many of the formulae were obtained for products which have 
now entered world trade in competition with Germany? No? 
Well, you may be assured that Germany has not. 

Is it not the proper moment to erect a few tank-proof ob- 
stacles in the way of such international merger-colossi instead 
of greasing their path with tears of sorrow at our own help- 
lessness, while decking the oncoming monopolies with the 



138 TREASON'S PEACE 

coupons of bonds sold to American purchasers by American 
banking houses? 

In God's name! Has the American chemical industry no 
guts? 

Full credit for that editorial challenge to the power of Farben 
belongs to Sidney Dean, but I had some small part in its inspira- 
tion and I also secured a large number of reprints with which for 
some time afterward, I belabored official Washington in a vain 
attempt to arouse a realization of what Farben had already done, 
and proposed to do, to our national security. 

As part of the story of this editorial it should be added that the 
publication Chemicals no longer exists. It met with the sad fate 
that so frequently has been visited upon those who rushed in, in 
print, where the Farben brand of angels fear to tread. 

The story of Secretary of Commerce Herbert Hoover's Chemical 
Advisory Committee goes back to 1925, when Mr. Hoover an- 
nounced that he had appointed a group of nine men, each promi- 
nent in some branch of the chemical industry, to act as a liaison 
body between the industry and the Department of Commerce. 

One member of that original committee was Henry Howard, 
vice-president of the Grasselli Chemical Co. Later Mr. Howard's 
name on the committee was to assume a very definite significance. 

In December, 1926, several hundred men more or less promi- 
nent in the chemical industry received invitations signed by Mr. 
Hoover which stated that he was calling a conference in Wash- 
ington at the suggestion of the Chemical Advisory Committee in 
order to inform the Department as to the needs of the industry. 

Being one of the elect I attended the conference and the ban- 
quet which followed. By that time I.G. Farben had been formed. 
Its gigantic proportions were realized and the character of its 
early tie-ups in the American drug and dye industries had become 
public. For this reason the main subject of private discussion on 
the floor of the conference was Farben. And the one great question 
in the minds of all present was where Mr. Hoover stood on the 
issue. The answer, as far as the conference was concerned, was 
zero. 

Mr. Hoover spoke feelingly of the wonderful service to business 



TREASON'S PEACE 139 

the reorganized and enlarged Commerce Department was pre- 
pared to render, and of his own determination to assist the chem- 
ical industiy. However, when some of the diners asked questions 
which approached the Farben issue, it was impossible to deter- 
mine from the replies what, if anything, the Federal Government 
intended to do to put a stop to foreign encroachments upon the 
industry. 

A year later it was announced that a second conference of execu- 
tives of the chemical industry was to be called by Secretary Hoover, 
and this time the engraved invitation tacitly recognized the Farben 
issue by stating that its purpose was "to consider present world 
conditions as they affect the American chemical industry.'' Mean- 
while, and as a preliminary to this second conference, it was 
announced that Secretary Hoover had decided to increase the 
membership of his Chemical Advisory Committee with eight 
additional executives, three of whom were Walter Teagle, presi- 
dent of Standard Oil of New Jersey, Lammot duPont of the duPont 
Company and Frank A. Blair, president of the Sterling subsidiary, 
Centaur Co. It had already been announced publicly that Stan- 
dard, under Teagle's leadership, had entered into the first of its 
tie-ups with Farben. The duPont relationship was recognized. And 
Sterling was boasting openly of its newly gained power as Farben's 
American partner in the drug industry. Blair was recognized as 
the most active of the lobbyists who represented Sterling's inter- 
ests at Washington, especially in legislative matters. 

So, here were four men, Teagle, duPont, Blair and Howard, serv- 
ing on the Secretary's Chemical Advisory Committee to tell him 
what the chemical industry wanted done about Farben. And the 
companies of all of them may appear to have been on the Farben 
side of the fence. 

About this time, many articles were being published about the 
tremendous strides the Germans were making in their attempt 
to draw the chemical industries of the entire world into their 
sphere of influence. And not a few of the articles had to do with 
Farben's new ventures in the United States. 

In the New York Journal of Commerce of January 12, 1928, 
Department of Commerce officials were quoted as having stated 
that they had no confirmation from their representatives abroad 



140 TREASON'S PEACE 

regarding the proposed entry of I.G. Farben into the American 
chemical industry, and refused to comment upon the report that 
Farben was seeking to purchase American companies. The cor- 
respondent of the Journal then went on to state that there was 
some agitation in Washington for legislation to combat the en- 
croachments of the Germans, but that Secretary of Commerce 
Herbert Hoover had expressed the opinion that "lengthy study 
of the situation would be necessary before steps could be taken 
to amend the law, and that hasty action should not be counte- 
nanced." 

As events were to prove, neither hasty action nor any other 
kind of action was taken, save to unlock all the legal doors and 
throw away the keys. 

Many of us who made the trip to Washington for the second 
conference expected some enlightenment, and possible encourage- 
ment, on the Government's attitude towards Farben. We got the 
enlightenment but not the encouragement. 

Among the speakers announced were Colonel William J. Don- 
ovan, Acting Attorney General; William T. Daugherty, Trade 
Commissioner of the Commerce Department at Berlin; and Dan- 
iel J. Reagan, Commercial Attache at Paris. 

Some pointed questions had been prepared to be put to Colonel 
Donovan regarding enforcement of the antitrust laws. However, 
that was not to be. The open forum, which had been scheduled, 
was turned into a closed shop by the opening remarks of the chair- 
man who announced that it had been decided to dispense with 
questions from the floor because they would not be as beneficial 
as questions that had been coordinated by the Advisory Committee. 

Mr. Daugherty, the Secretary's ace investigator of the German 
cartel, made some interesting observations. "The cartel," said Mr. 
Daugherty, "when it combines producers of varying production 
costs, protects the weak against the strong" (a beautiful thought 
but hardly an accurate one). Mr. Daugherty went on to say: 

German dye trust officials have been considerably exer- 
cised of late by press reports that their chemical industry cal- 
culated to consolidate for the particular purpose of opposing 
the best interests of the American chemical industry. While 



TREASON'S PEACE 141 

it is not the purpose of this discussion to reach any definite 
conclusion on this controversial issue ..... I can quote cer- 
tain leading figures of the German dye trust who deny first 
that they are out to fight the American chemical industry, and 
secondly that the dye trust has bought heavily into shares 
of the American chemical industry. 

They emphasize on the other hand that it is their wish 
to frame agreements with elements in the American chemical 
industry and cite as proof of this at least three German- 
American agreements arrived at in the past year. They indi- 
cate also that further special agreements with American chem- 
ical and related companies are in sight 

Before leaving Berlin last month, I was told substantially 
the same thing by Dr. Bueb, the dye trust's leading figure 
in that city, that if accurate information were wanted concern- 
ing the dye trusts' plans in connection with international tie- 
ups, either he or Dr. Bosch would welcome questions from 
any reasonable American firm, association, or individual. 

The dye trust's argument is of course that rationalization, 
begun after the inflation period in Germany, is now being 
sought internationally in the interest of lowering costs by 
combatting over-production, by allocating markets, and it 
follows that such arrangements involve price fixing. This effort 
is only in its beginning now and the future may bring forth 
many significant international associations. 

When Mr. Daugherty finished his address I found myself stand- 
ing at the elbow of Mr. H. Hill of Kuttroff, Pickhardt & Co. I asked 
him how he liked the speech. "Very good, splendid" replied that 
member of Farben's American front. 

Mr. Reagan's speech, in light of later events, contained some 
food for thought. He quoted the head of the French dyestuff in- 
dustry as saying that he considered it the policy of the French 
chemical industry to promote peace by effecting international 
ententes. 

Colonel Donovan was the most important speaker at the con- 
ference, and his subject, as announced, "Foreign Cartels and Amer- 
ican Industry" gave promise of a clear-cut statement of the attitude 



142 TREASON'S PEACE 

of the Justice Department towards I.G. Farben and the latter 's 
American tie-ups. Stated the Colonel: 

It is the belief of the Department of Justice, that when a 
foreign monopoly, though legal in its place of origin, comes 
into this country, and, by collusion with our citizens enters 
into agreements here for the restraint of trade and the en- 
hancement of prices, those agreements are just as illegal, and 
just as much subject to our laws, as they would be if the cor- 
porations and individuals involved were creatures of our gov- 
ernment. 

This part of the talk sounded as though the Colonel was clearing 
the decks for action. Thurman Arnold could not have put it strong- 
er. A bit later, however, he said: 

So far as it presently appears, the so-called chemical en- 
tente and the Franco-German dyestuffs agreement appear to 
involve no attempt to exploit this market. In fact, we have 
authentic assurances that these arrangements are not directed 
against this market. 

Two days before the conference those of us who had accepted 
the invitation received a wire stating that Mr. Hoover would be 
unable to attend. His apologies, read to the conference, expressed 
his regret at not being present, and complimented the industry 
for having solved some of its difficulties. "The Department of 

Commerce/' said the absent Secretary, "is created for service 

We can serve only by direction of the leaders of the industry. 
Therefore the industry is asked to express its needs to the Advisory 
Council/' 

It was a happy thought, we could write to Mr. Teagle or to 
Mr. Blair. In my own case all doubts were removed. I declared an 
all-out war. 

Mr. Hoover became Secretary of Commerce in 1920, when the 
original postwar Republican Cabinet was installed by Warren G. 
Harding. His official activities in Europe during the war, and 
as an adviser at the Peace Conference, had given him much first- 
hand knowledge of the backstage connections of Kaiser Wilhelm's 



TREASON'S PEACE 143 

war machine. As Secretary of Commerce for eight years, he was 
to be supplied with much additional data which pictured the pat- 
tern of I. G. Farben in all of its many manifestations in other 
countries and inside the United States. 

In January, 1924, Dr. Julius Klein, Director of the Bureau of For- 
eign and Domestic Commerce, transmitted to Secretary Hoover 
a report prepared by Thomas W. Dalahanty, of the Chemical 
Division, which contained a very excellent historical sketch and 
chart of the German dye companies. The report referred to the 
part played by the German government in the success of the car- 
tel; to the cartel's practice of taking out basic patents in all coun- 
tries in order to stifle others in its field; and to the dishonest prac- 
tices of dumping, bribery, deceptive labeling, and false propa- 
ganda; and the setting up of, or control of factories in this and 
other countries in order to assist the mother industry. 

No one reading that report could have any doubt as to pre- 
cisely what the Germans proposed to do and would accomplish, 
if permitted, in the establishment of new tie-ups, partnerships and 
subsidiaries, inside the United States. 

In 1927 Dr. Klein and Mr. A. Cressy Morrison, Union Carbide & 
Chemical Corp., executive, and chairman of Hoover's Chemical 
Advisory Committee, attended the Economic Conference of the 
League of Nations as unofficial observers for the United States. 
Mr. Morrison's widely published accounts of the conference dis- 
cussed at some length the so-dalled "Rationalization of Industry" 
by which I.G. Farben, as a cartel, was alleged to reduce costs 
and therefore lower prices to the consumer. Mr. Morrison was 
somewhat skeptical about the usefulness of the cartel theory, and 
stated quite plainly that its strength lay in its centralized control 
and ability to dump its products or utilize other competitive de- 
vices to strangle its competitors. He recited one illustration, dis- 
cussed at Geneva, of the prewar activities of the German dye cartel 
in a South American country, which made this vicious part of 
the Farben pattern stand out in such high relief that it should 
have been sufficient warning to all concerned that Farben was 
again erecting an espionage machine. As Mr. Morrison described 
it: 



144 TREASON'S PEACE 

In Brazil, for illustration, representatives of the German 
Government were everywhere, in banks and other clerical 
positions, acquiring information regarding contracts and 
trade relations with other countries, so that the information 
might be transmitted to Germany and there acted upon by 
the cartel for the benefit of German commerce. 

Then, in February 1928, at the time of the Chemical Executives' 
conference, the Commerce Department published a lengthy anal- 
ysis of the progress of I.G. Farben, which referred to the 1927 
tie-up with Standard Oil; to its ties on rayon with the English 
Courtaulds, owners of American Viscose; and with Metz, Gras- 
selli, and Sterling-Bayer. 

Thus the record of this entire period proves conclusively that 
during what Thurman Arnold later called "the era of non-en- 
forcement of the antitrust laws/' the Government of the United 
States knew in ample detail what Farben was doing in Europe 
and in precise detail how illegal its tie-ups were inside the United 
States. 

Colonel Donovan made another noteworthy contribution to 
the picture on May 9, 1929, after Mr. Hoover had become Presi- 
dent and Donovan had resigned from the Justice Department. Al- 
though then in private practice, his views were regarded as in- 
dicating what action might be expected from the Hoover adminis- 
tration with regard to the financing of Farben's American I. G. 
Chemical Corporation with thirty million good American dollars, 
which operation, successfully consummated within a few weeks 
of Mr. Hoover's inauguration as President, had incited the out- 
spoken wrath of many men in the industry. 

The Colonel's address to a large gathering of members of some 
fifteen technical associations at the annual chemical industries 
banquet said little about the Farben issue, but that little was to 
the point. He stated that if the United States could build plants in 
France and in Germany for the production of American automo- 
biles and machinery, then the Germans had an equal right under 
the law to erect chemical plants in this country. 

The loaning of American money to Farben to enable it to erect 
plants in the United States, and the illegal character of the tie-ups 



TREASON'S PEACE 145 

by which Farben was tightening its grip upon our munition in- 
dustries, did not enter into the argument. 

In March 1930, Representative Wright Patman of Texas made 
a bitter attack upon both the Justice Department and the Federal 
Trade Commission for not enforcing the antitrust laws, and gave 
special mention to the Standard Oil group, to which he accused 
the new Attorney General, William D. Mitchell, of turning over 
his office. "This" said Patman, "is because he is following directly 
in the footsteps of Harry Daugherty." Patman's reference to for- 
mer Attorney General Daugherty takes us back to some of the 
notorious instances of criminal malfeasance and official degrada- 
tion of the Harding Administration. 

Among these shameful incidents were the indictment and trials 
of Daugherty and Thomas W. Miller, former Alien Property Cus- 
todian, for conspiracy in receiving bribes from German and Swiss 
interests in consideration for the return of some $7,000,000 of 
German property which had been seized by A. Mitchell Palmer 
and Francis Garvan. Others indicted were John T. King, former 
Republican National Committeeman from Connecticut; and Jesse 
W. Smith, this friend of Daugherty, who lived in the "little house 
with the green shutters" had an appointment to "talk" one morn- 
ing but never kept it he was found quite dead with a revolver in 
his hand and a hole in his head. King died before the first trial 
of Daugherty and Miller, at which a hung jury resulted. In the 
second trial Miller was convicted, but the jury failed by a single 
vote to convict the former Republican Attorney General. 

Regardless of the extent to which I.G. Dyes was directly in- 
volved with the German and Swiss individuals named in these 
indictments, the purpose of those who supplied the $400,000 bribe 
was the development of the Farben pattern. 

In 1929 Francis P. Garvan brilliantly summed up, on a court 
record, some of the official infamies which accompanied the be- 
ginnings of Farben's comeback in the United States. Garvan was 
the most conspicuous defendant in a case which was instituted 
during the Coolidge administration against A. Mitchell Palmer, 
Garvan, and a number of others in the federal court at Boston, 
Mass., for alleged improper handling of the sale of Bosch Magneto 



146 TREASON'S PEACE 

Co., headed by Robert Bosch, brother and close associate of Carl 
Bosch head of I.G. Dyes and I.G. Farben. 

The charges were made and publicized continuously from the 
time Palmer and Garvan first seized and then sold the Bosch prop- 
erty for over $4,000,000, under authority and instructions of Presi- 
dent Woodrow Wilson. They constituted the high point in the 
propaganda to discredit the seizure of the properties and patents 
of the Germans, and to justify their return by the Republican post- 
war administrations. 

Among those involved was Merton E. Lewis, a lawyer who was 
first retained by the Bosch interests in 1919 to attack Mr. Palmer 
before a Senate Committee. Later, Mr. Lewis was made an assis- 
tant to the Attorney General to prosecute Garvan and Palmer, and, 
fantastic as it may appear, his pay for this official service again 
came out of Bosch funds. 

Among others named by Garvan in scathing language were John 
Grim, former counsel for the German Embassy who was appointed 
by the Justice Department to secure Garvan's indictment; along 
with former Attorney General Daugherty and his notorious pals, 
Jesse Smith, Gaston B. Means, Thomas B. Felder, John T. King, 
Thomas W. Miller and a long list of others identified by Garvan 
as German agents., 

Republican Senator George H. Moses was pictured as instigat- 
ing Gaston Means to "get" Garvan by fair means or foul, and as 
appointing Otto Kahn, partner of Paul M. Warburg, of Ameri- 
can I.G., as treasurer of the Republican Committee to raise funds 
with which to elect Senators who would vote favorably to Farben's 
interests. 

Mr. Garvan's testimony, with citations from official records, was 
couched in language without precedent in denouncing high gov- 
ernment officials in a court proceeding. Garvan, waiting for years 
for the opportunity, forced into one concise record the assembly of 
facts which not only cleared him and the others of wrong doing, 
but proved the infamy which had indicted them. He let loose 
with both barrels and the result was devastating. 

While Mr. Garvan was testifying relative to the Bosch Magneto 
case one of the government attorneys asked: 



TREASON'S PEACE 147 

Has anything occurred since Jan. 1, 1919, which had been 
the occasion of your having a rather accurate memory with 
respect to the details of the Bosch transaction? 

Garvan in reply let loose a barrage of fact which completely 
destroyed the case against him, and which pictured the pattern 
of Farben and its allies in all of its vicious ramifications. For stark 
indecency there is no page in the history of this republic which 
approaches the recital of shameless bribery, brazen corruption and 
foul pollution of official power which Garvan, on Dec. 11, 1929, 
hurled into the faces of his accusers, and burned into the records, 
of the case. 

Incriminating his persecutors with one sordid fact after an- 
other Garvan traced each link in the chain of official degradation 
straight back to Robert and Carl Bosch, and to the latter's plan 
to destroy the military security of this nation. 

It is imperative to quote Garvan's testimony at some length in 
order that the reader may perceive, in its full significance, how the 
sinister facts from the record fit. together to form the pattern of 
what has already happened and the prospect of what was yet to 
come. In part, Mr. Garvan's testimony was as follows: 

In answer to your question as to the refreshing of my 
recollection ..... I think it is probably better to state it 
this way: that the overpowering fact that has illuminated my 
memory, has made me search every possible record and has 
made me ceaselessly work night and day to ascertain the truth 
of the facts in this case, was the charge in the complaint here, 
signed and sworn to by Merton E. Lewis, to the effect that 
when our country's darkest hour, in April 1918, was at hand, 
when, as President Wilson said, we were with our backs to 
the wall, that I betrayed my country and entered into a con 

spiracy to turn over this company for less than 

its value. That is a charge of treason and there has not been 
one word of testimony, and furthermore there never can be 
one word of testimony adduced as to the truth of that charge 

and then I found the following facts: that in our 

files (Alien Property Custodian) on the payroll of the Ham- 
burg American line for three years before the war was a man 



148 TREASON'S PEACE 

by the name of John T. King, receiving a salary of $15,000 a 
year for mysterious services; that on that payroll was Gaston 
B. Means; that Means had been a German spy in this country 

for years and years and then this man John T. King 

shows up in my office and says he is to be appointed Alien 
Property Custodian John King told me his appoint- 
ment had been obtained by himself from Senator Moses, 

and next we find that he and Senator Moses had 

obtained the appointment of Thomas W. Miller of Wilming- 
ton, Delaware. 

Then, the day after Miller is appointed I find Sena- 
tor Moses in Tom Miller's office asking about the Bosch 

case next, in May 1921, two months after I left the 

office, we find Gaston Means is put in on the investigation 
of the Bosch Magneto case. I refer now to Gaston Means' 
testimony in which he admits he had been a German spy for 
six years; that he got $1,000 a week from Boy-ed; that he had 

been tried for murder in Carolina and he himself says 

that Senator Moses put him in charge of the Bosch case 

then we find that they must have a lawyer to take charge 
of this case, and whom do they select but John Grim, spelled 

in English C-r-i-m but in German K-r-i-m Who is John 

Grim? During the war he was counsel for Hays, Kaufman and 
Lindheim, the counsel for the German Embassy, two mem- 
bers of which firm I sent to State's Prison. He was counsel 
for Hans Tauscher, who tried to blow up the Welland Canal, 
and he was counsel for the German who tried to put bombs 
on ships in our harbor, and his entire war service was that 

of serving German malefactors When the war is over 

he is put down in Washington in charge of the prosecu- 
tion of the officers of the United States Government who 
seized German property during the war. Thus it goes on; 
from that time on we find Means and Grim and Burns in 
charge of the proceedings; we find Means reporting to Jesse 
Smith of Attorney General Daugherty's staff; we find Bosch 
now hiring another man, Thomas Felder, who is Daugherty's 
ward man, who since was convicted and is dead; Means since 
convicted of defrauding the United States Government and 



TREASON'S PEACE 149 

bribing its officers Later we find Miller convicted and 

sent to Atlanta Prison for being an employe of the Germans 

in this country. Poor Tom Miller, a decent clean boy 

a beautiful clean record in the war, and then this bunch 
picked him, because he was a weakling, and then corrupted 
him with German funds for what? For getting behind their 
movement to recover not only the Bosch Magneto but to 
recover the whole six hundred millions of German property. 

Always remember that this case is only the bellwether 

of German propaganda. This case was really over in 1928 

when they had befogged the mind of Congress, and befogged 
the issue as the bill was passed which returned every dollar 
of German property that had been seized during the war 

Next they concocted the scheme of indicting me in the 
Chemical Foundation case ..... I went down there and Mr. 
Grim, this counsel for the German Embassy, counsel for Hans 
Tauscher, counsel for explosive bombs, counsel for members 
of the bar convicted for defrauding the Government during 
the war, and German spies, opened the door of the United 
States Grand Jury room and said, 'Please give me your books/ 

and I said, 'No sir, I will walk in with them' and when 

I got in I offered to waive all immunity and I asked Mr. Grim 
to turn right around and explain to the Grand Jury who he 
was and what he was doing there and what his former record 
was, and how this was not a case of the United States against 
Garvan, but that it was a case of Germany against the 

United States, and I asked the Grand Jury to make Mr. 

Grim tell them who he was and what he was doing there. 
And that was the last of Grim in the Chemical Foundation 
case or in the Bosch case 

Another thing that has made this thing burn into my 
mind is the fact that the man who sat in at the begin- 
ning of these charges in 1919 (M. E. Lewis) now is able to 
make this charge in this complaint under a salary of $1,000 
per month drawn from the German funds in direct viola- 
tion of the Penal Law of the United States 

America is entitled to know that the propaganda for the 



150 TREASON'S PEACE 

return of German property which seemed to necessitate be- 
spattering public officials was founded upon misstate- 

ment of facts and false charges, and I want to ask that at the 
conclusion of this hearing Mr. Lewis stand on his feet and 
say what he had in his heart and mind when he made those 
charges, and to ask me any questions under the sun, because 
now, at last I see him face to face 

I wanted to prove this whole historical picture. I wanted to 
call Senator Moses before you and Merton E. Lewis and Otto 

Heins and Robert Bosch and I wanted to show you how 

the two Bosch brothers in Germany, Robert, the head of this 
concern, with his powers of attorney from twenty or fifty 

other big concerns in Germany, and Carl the head of 

the chemical cartel of the world, joined forces and 

show you the whole historical picture which came to a close 
with the successful return of German property 

I would like to insert in the record from Means' own tes- 
timony the fact that he admits that Senator Moses obtained 

his appointment on the Bosch case; they published 

across the country that a conspiracy had been established 

and then came the tie-up with Hearst and the 

great publications in his office where you will find all the 
private papers of the Attorney General's office and the Alien 
Property Custodian's office 

The pressure of the government of Germany which had 

bought Attorney General Daugherty and Tom Miller 

those are the things that burn this case into my mind 

they obtained the appointment of Mr. Lewis as Attorney 
General I particularly want to put into the record let- 
ters from Senator Moses, from his office rather, Mrs. Gold to 
Mr. Bennett, showing his control of the Bosch Magneto case 
and showing the linking of it together with the fight against 
our building up the chemical industry 

All that time the Attorney General of the United States, 
Daugherty, and the Alien Property Custodian, Thomas Miller, 
were in the employ and pay of German people and had $50,000 
worth of U. S. Government bonds handed them and put in 



TREASON'S PEACE 151 

their pockets by whom Go back, go back, go back by John 
T. King, the $15,000 representative who died three days 
before he could be tried 

Some of you saw the other day that Senator Moses had 
appointed Otto Kahn as treasurer for the election of new 
Senators. You did not associate the fact that his friend and 
partner, Warburg, is the head and front of the American 
interest in the American Interessen Gemeinschaft, in its at- 
tempt to destroy our chemical industry, and that there is a 
tariff pending in the U. S. Senate, and that the same ques- 
tion is left open, and that the same Pickrell and the same 
agents that worked in this case, are working around the cor- 
ridors of the Senate today. The endeavor was that Kahn 
would furnish the money for the election of the Senators who 
would vote upon the question of American valuation or for- 
eign valuation. German propaganda again eating into the 
vital problem of the life or death of the second greatest in- 
dustry of the country today, the chemical industry. It is never 
a dead issue. Peace? There is no Peace. Always the fight goes 
on for the supremacy in, the chemical industry because it is 
the keystone to the safety of the United States or of any coun- 
try in the world today. Your rules, your statutes, your Bosch 
case are only appendages, they are only part of a great, great, 
struggle of Germany to recover the position of throttling 
chemical development and of domniating over the entire 
world the development of the chemical industry, which is 
the secret of industrial prosperity and the secret of military 
prosperity, and the secret of the peace and happiness and 
health of the nation, that is why I put into this record a bit 
of the historical picture because you will find the same bunch 
down in Washington, you will find Bennett in Washington, 
you will find Herman Metz, you will find Pickrell, you will 
find the same bunch working from the same offices, with the 
same sources of money, using every contention possible to 
befog the minds of Congress, which is charged with the 
protection of this country in its industries and in its military 
equipment. That is about all I think of. 



152 TREASON'S PEACE 

Merton E. Lewis, after an unsuccessful effort to have Garvan's 
entire statement stricken from the record, began a rambling dis- 
course on the circumstances which he said led to his original 
association with the Bosch interest, and to his later appointment 
as a special assistant at $10^000, a year to prosecute the case 
against Garvan and Palmer. Garvan continued to torment Lewis 
during the latter's attempt to explain away the charges; at one 
point Garvan demanded that Lewis cross-examine him on the al- 
leged conspiracy: 

Now is the opportunity, if there is any question lurking in 
any man's mind, why for God's sake, let him speak up and 

ask me questions I don't care how far astray or how 

personal or how anything else the questions are, but ask 
them of me now. 

Mr. Lewis apparently did not choose to ask Garvan a single 
question. He did not care for the way Garvan answered ques- 
tions. So Mr. Garvan, the defendant, finally asked Mr. Lewis the 
prosecutor: 

I understand you said that neither Attorney General Sargent, 
nor his assistant. Mr. Letts, ever told you you were being 
paid by the Germans? 

MR. LEWIS: I don't think they did at that time. I learned of 
it of course, when a check came to me 

Mr. Garvan later put into the record a letter describing how 
the plans for recovering German properties were progressing. This 
was written by Harvey T. Andrews, agent of the Bosch interests, 
in July 1922 to one of his employers in Germany. It stated, in part: 

The work entailed on my office in the disentangling of the 
German property proposition has entailed profound and con- 
stant attention. Sundays, nights, holidays and every day have 

been all alike since you left 

It appears at the present time as if I was among the few 
who really had the right angle on this matter The recog- 
nition on the part of the Administration of the fundamental 
principles is due largely to my efforts as well as to my con- 



TREASON'S PEACE 153 

nections, and it would be futile for me to attempt to explain 
how, where and through what agencies I succeeded in getting 

it done I have done all that my thirty-five years of 

practical knowledge of political affairs in this country induced 

me to do in order to win Have a little patience and 

everything will be much better than you anticipated. 

This astounding document was sworn to by Mr. Garvan on Jan. 
22, 1930, and was then made a part of the record of the federal 
court at Boston, whereupon Attorney General Mitchell promptly 
announced that the suit was dismissed because no wrongdoing 
had been shown on the part of Mr. Palmer or Mr. Garvan or any 
of the other officials accused in the complaint of conspiracy in the 
seizure and sale of the Bosch property. If the government had won 
this suit the chief beneficiaries would have been Robert Bosch and 
his associates. Yet to this day, mud continues to be thrown at the 
memory of Francis P. Garvan on the basis of those fake charges 
first made and broadcast by some of Harding's gang. 

Inevitably as the pattern is unfolded the story now goes back 
still further it goes back to the letter written in 1916 by the Bayer 
Company's Dr. Hugo Schweitzer to Ambassador von Bernstorff, 
in which that celebrated head of German espionage spoke of elect- 
ing a President of the United States whose party politics were 
more in harmony with the cause of the German dye trust. The 
story goes back also to Herman A. Metz, the dyed-in-the-wool 
Tammany leader and life-long Democrat who suddenly switched 
his allegiance to the Republican Party. 

In 1930, while Metz was explaining to the Senate Lobby his 
campaign contributions to Senator King, he also gave his reasons 
for having deserted the Democrats in 1919. Senator Caraway de- 
veloped this in the following testimony: 

SENATOR CARAWAY: You came to Congress as a Democrat? 

MR. METZ: Yes Sir. 

SENATOR CARAWAY: I believe you were one of the Harding 

Democrats? A Democrat that supported Mr. Harding? 
MR. METZ: Well, I contributed to the Harding campaign fund 

afterward; yes, sir. I did not like the treatment some of the 

Democrats gave me. 



154 TREASON'S PEACE 

(Metz' dislike for the treatment that some of the Democrats 
gave him and his I.G. friends is understandable. So it is per- 
missible to conclude that he bolted the Democrats for a more 
sympathetic party.) 

However, according to Metz his "people abroad" did not alto- 
gether approve of his holding public office because they thought 
that it interfered with his business activities; or at least so he 
once informed a Senate Committee. Possibly the I.G. considered 
Metz more useful from the less conspicuous vantage point as a 
business man and philanthropist who would be free to contribute 
campaign gifts where they would do the most good. 

Toward the close of the postwar decade President Herbert 
Hoover wrote to his good friend, Dr. William O. Thompson, presi- 
dent emeritus of Ohio State University, a plaintive discourse 
upon the problems confronting a chief executive of the nation. 
In that letter, dated Jan. 10, 1930, President Hoover said in part: 

We can and must, however, greatly increase the production 
of truth, and we must know the truth, before the grave inter- 
est of 120,000,000 people is involved in government policies. 

The author has had Mr. Hoover's quaintly expressed goal con- 
stantly in mind for many years; he believes it to be particularly 
applicable to this chapter. 



CHAPTER IX 



Democrats Facing Both Ways 



EARLY IN MARCH 

1942 six distinguished-looking gentlemen were seated around a 
conference table in one of the high-ceilinged rooms of that archi- 
tectural monstrosity, the Treasury Building. One of those present 
was contending earnestly that the Americanization of General 
Aniline & Film Corp. had been assured, first, by the election of 
Judge Mack as president, and later by the appointment of other 
well-known Americans as directors. The speaker droned on and 
on. Finally, he was interrupted by Leo T. Crowley, long time head 
of the Federal Deposit Insurance Corporation, who said, "See 
here, Homer, we're all grown up you know, and everyone else 
knows that John Mack, splendid citizen that he is, is not the man 
to head General Aniline." 

Thus rebuffed, Homer S. Cummings, counsel for General Aniline, 
cut short his argument for inaction, and the meeting proceeded 
with its business of approving the new four-man board of direc- 
tors for General Aniline which the Treasury had agreed upon. 

Mr. Cummings had good reason to plead for a status quo. The 
new Treasury-appointed board could not be expected to con- 

155 



156 TREASON'S PEACE 

tinue his retainer as Washington attorney (rumored to be $100,000 
a year) which had been arranged by the old Farben board. 

In this connection, and as another example of how precisely 
the Farben pattern repeats, it is interesting to look back to the 
time when the I. G. Dyes crowd hired John King, former national 
committeeman from Connecticut to help Attorney General Harry 
Daugherty give back the German properties that had been seized 
during World War I. Then, some two decades later, when it again 
became advisable to take on some additional help in Washington 
this time to prevent another seizure of similar properties Farben's 
General Aniline hired Homer S. Cummings, who was not only 
a former national committeeman from Connecticut, but a former 
chairman of the Democratic National Committee itself, and who 
had just completed a six-year term as Attorney General of the 
United States. 

While Farben always plays both ends against the middle, 
politically it strings along with the party in power and so, with 
the passing of the old "Ohio gang," Farben's American fronts sud- 
denly became Democratic strongholds, at least as far as the nation's 
capital was concerned. 

In 1932, James A. Farley, chairman of the Democratic National 
Committee, had solicited my support for his candidate, and asked 
me to discuss with Mr. Charles Michelspn, publicity director of 
the Committee, such issues as I thought should be brought into 
the campaign. The result was what is known as the brush-off. 
To keep the record straight, I confirmed the meeting in a letter 
to Mr. Michelson, in which a high point of our disagreement was 
recorded as follows: 

When you assert that Eddie Clark, Louis K. Liggett's lobby- 
ist is a 'nice chap/ and that you don't blame Mr. Hoover 
for securing the support of Drug, Inc., who pay for Clark's 
lobbying, you are really admitting the very point I allege, i.e., 
that Hoover's connection with this outfit of patent-medicine 
fakirs is so clearly defined that Governor Roosevelt could 
find no more powerful illustration of the hypocrisy of the 
present occupant of the White House. 



PEACE 157 

On the same day I wrote to Mr. Farley, enclosed a copy of 
my letter to Michelson, and restated the Clark-Drug, Inc. issue: 

Mr. Hoover's recent performance in taking into the White 
House as his secretary, Mr. Liggett's lobbyist, is in itself, 
without trimmings, a major issue. 

Diplomatically, I had referred to Clark as Liggett's lobbyist 
rather than Farben's. Mr. Farley acknowledged this letter with 
assurances of appreciation for my suggestions, and with a nice 
word of thanks for my cooperation. However, he did not bring 
the Clark-Drug, Inc. issue into the campaign. 

After the election of Mr. Roosevelt, the announcement that 
Senator Thomas Walsh, of Montana, was to be the new Attorney 
General gave a tremendous boost to the hopes of those of us who 
had been working for some such strong arm and keen mind to 
direct the affairs of the Justice Department for someone who 
would start delving into the whys and wherefores of the inaction 
against the flagrant violations of our antitrust laws, and other 
federal statutes, that had stigmatized the three preceding ad- 
ministrations. 

These hopes expired, however, when Tom Walsh died suddenly 
in a Pullman sleeper not long before he was scheduled to take 
over the direction of the Department from W. D. Mitchell. Who 
can say how or why the hand of Fate which led Tom Walsh to his 
untimely end, at a moment of triumph, should also have induced 
the selection of Homer S. Cummings to occupy the high office 
thus left open to some deserving Democrat. 

The official pronouncements during Mr. Cummings' regime as 
Attorney General are of interest in their relation to the phrase, 
"the era of non-enforcement of the antitrust laws" coined by Mr. 
Thurman Arnold. One was a broadcast by the new Attorney Gen- 
eral on June 10, 1933, in which he referred feelingly to the Vicar 
of Wakefield's complaint that "the laws govern the poor and the 
rich governs the law," and then announced that a vigorous cam- 
paign against racketeers was to be started. It was a beautiful ad- 
dress. Everybody is against racketeers. 

The other announcement came from Mr. John Dickinson when 



158 TREASON'S PEACE 

that gentleman was appointed by Mr. Cummings to take charge 
of antitrust law enforcement. Mr. Dickinson stated that those 
laws would be enforced to the hilt only when someone was get- 
ting hurt, and explained that the Antitrust Division was not a 
"detective agency." So far as Farben was concerned, no detec- 
tive agency was needed to reveal the illegality of their contracts; 
but this was in 1935, no one was being hurt then. 

Later, millions were to die. 

My own relations with Mr. Cummings began at arms length in 
1933, when he became Attorney General, and later developed to 
sword's point. Finally, in a letter not intended for my eyes, the 
Attorney General warned a member of the Senate that it was 
considered "dangerous to correspond with Ambruster." Indicat- 
ing an official state of mind which perhaps Mr. Cummings may 
share with other figures in the story of I. G. Farben. 

The real gem of Homer Cummings' official writings, was the 
naive allegation which appeared in his 1937 Annual Report to 
Congress, of his administration as Attorney General, that: 

"The antitrust laws have saved us from any cartel 

system." 

Perhaps, though, we are going too fast with the Democratic 
part of the story. Away back in September 1918, when Francis 
Garvan house-cleaned the American Bayer Company, he in- 
stalled a new set of officers to take the places of those he had 
jailed or put in internment camps. Unquestionably Mr. Garvan's 
intentions were just what he stated them to be to create an ail- 
American concern by putting native-born Americans in charge 
of the company; Americans, who so far as was known, had no 
connections with the former German owners. 

As stated in Chapter in, among these new Bayer executives, was 
a young Democratic attorney named Earl I. McClintock. He had 
been just added to the staff of the Alien Property Custodian to 
become secretary of the seized Bayer Company, and retained that 
position all through the sale of the company and the transfer of its 
title to Sterling Products, Inc. When the latter took title, Mc- 
Clintock went along with the plant and goodwill of the business. 
He tossed aside his salary of $3,000 a year and opportunities for 
advancement in Government service for $13,000 a year as an 



TREASON'S PEACE 159 

executive for the new owners. This modest sum was, of course, 
to increase as McClintock rose to become the right-hand man of 
Doctor William E. Weiss in those deals which were to return 
the "Americanized" Bayer to the not too remote control of its 
former German owners. 

As an executive of Sterling, Mr. McClintock climbed steadily 
while the Republicans held sway at Washington. Politically, how- 
ever, he remained in a state of suspended animation until after 
that fateful period when the sun of Herbert Hoover slid over 
the horizon, leaving neither chickens nor pots; only a sheriff's 
notice on the empty garage. 

When the Democrats got back in the saddle, however, Mr. 
McClintock began to go to town, and it was not long before he 
was reputed to have become a figure of importance among the 
group that had put the New Deal into power. 

One of the claims to fame, boasted of by Mr. McClintock's 
friends, was his membership in, and some said his chairmanship 
of, the Finance Committee of the Democratic National Committee. 
Later, in 1941, after various official investigations had started 
some of the Government's keen young bloodhounds on the trail 
of the illegal Sterling-Farben tie-up, I heard more about Mr. Mc- 
Clintock's association with the Democratic National Committee. 
Usually the comment was highly critical, as the relationship was 
regarded as a definite obstacle to further investigation. So, on 
November 22, 1941, I wrote to Senator Guy M. Gillette, Chair- 
man of the Senate Committee to Investigate Campaign expendi- 
tures, asking for: 

A searching investigation to determine the size and number 
of contributions which have been made, directly and in- 
directly, to the Republican and Democratic National Com- 
mittees, and to the campaign funds of individual candidates 
for the Senate and House of Representatives, during the last 
ten years, by the German I.G. Farben and its American 
corporate allies; especially those included in the Sterling 
Products, Inc., group of patent-medicine manufacturers 

Senator Gillette's reply was not encouraging. I was a bit too 
late; the committee had been appointed for the 1940 campaign 



160 TREASON'S PEACE 

only, and had been dissolved, "So it has no authority or existence 
at the present time/' 

It appeared that there is an open and a closed season for in- 
vestigating campaign funds. So, I put that correspondence in my 
"await events" file. Then, nearly a year later, on September 12, 
1942, I tried again. This time I wrote to the Hon. Ernest W. 
McFarland, the new chairman of the Senate Campaign Contribu- 
tions Committee, suggesting 

The urgent necessity for an inquiry into past and current 
contributions by allies, affiliates, and agents of the German 
I.G. Farben. 

Such contributions coming directly or indirectly from 

this vicious German cartel played a tragic part in the past 
in influencing, or controlling, legislative and administrative 
acts in these United States. There is an abundance of evi- 
dence available to prove this. 

Largely, as a result of not stopping this kind of thing here- 
tofore, we found ourselves in the relatively unarmed condition 
Avhen the combat war which these people planned for so long 
finally began. It is unthinkable that repetition should be 
permitted, or that we should ignore it now that we are pay- 
ing the price, in blood, for our neglect. 

If we are to win the war, if our democracy is to survive 
it has got to be stopped. And the only way to stop it is by a 
drastic investigation of all who have been, and all who still 
are, involved in any phase of it ..... 

Should you request further details, names, dates, amounts, 
etc., I shall consider it my duty as a citizen to supply them 
to you. 

Receiving no reply I called upon the Senator on Oct. 9, 1942, 
and was received by the energetic young counsel for the com- 
mittee, James A. Walsh, who appeared to be intrigued by my visit, 
and undertook to find out the date when Mr. McClintock had 
retired as chairman, or as a member of the finance committee of 
the Democratic party. Some time later Mr. Walsh wrote me the 
result of his inquiry: 



TREASON'S PEACE 161 

Following your call at the office, I contacted the Democratic 
National Committee and was advised that Mr. McClintock is 
not presently a member of the Finance Committee of that 
organization. 

That information not being as complete as it might be, I wrote 
Mr. Walsh again on Dec. 24, 1942: 

Many thanks for your letter of the 14th. Can you advise 
me of the date when Mr. McClintock was first appointed 
to the Finance Committee of the Democratic National Com- 
mittee by the Hon. Jas. A. Farley. Also, whether he was asked 
to resign, or did so without being so requested after his 
Farben affiliations became more or less public property. 

I am assuming, of course, that by use of the word "pres- 
ently" your informant on the National Committee meant to 
imply that McClintock was just getting out or had just an- 
nounced his intention so to do. I think that you would be 
performing a very useful public service if you would check 
and record all contributions which McClintock se- 
cured from I.G. Farben and its American affiliates; also his 
relations with the Hague machine in New Jersey. Such facts 
are all matters of record, though more or less concealed and 
disguised, and should be brought out into the sun-light. . . . 

You will understand, I hope, that I" do not imply for a 
moment that Farben money went only to the Democrats, or to 
those who call themselves Democrats. Far from that! I hap- 
pen to know that the record of those labeled Republicans is 
every bit as bad, especially when they were in power. 

One thing I am very sure of; these matters must not be 
kept under cover now. If the Senate continues to ignore them 
while lives are being lost, then there is something very 
rotten indeed. 

I am sure that you feel the same way about it. Otherwise 
I would not write you with such brutal frankness. 

In his response, Mr. Walsh indicated that I was again trying 
to shoot at campaign contributors out of season, which was 



162 TREASON'S PEACE 

positively not permitted by the Senate. As Mr. Walsh put it in a 
letter dated Jan. 14, 1943: 

with reference to possible campaign contributions 

by I.G. Farben and its American affiliates: 

I should perhaps explain that the information I obtained 
concerning Mr. McClintock did not indicate the recency of 
his separation from the Finance Committee, but was limited 
to the statement that he is not a member of the Committee. 
While an inquiry into this phase of campaign contributions 
in years past might be very revealing and informative, you 
will remember that the present Campaign Investigation Com- 
mittee is limited, by the terms of the resolution creating it, 
to matters occurring in the 1942 campaigns. 

The season must have been closed early that year, for no further 
word came from the Senate Campaign Expenditures Committee 
or its counsel. However, I determined to continue my official in- 
quiries into the mystery of when Mr. McClintock started and 
stopped being a member of the Democratic Finance Committee. 
So, I applied to the Democratic National Committee itself, and, 
diplomatically, merely asked to be advised the names of the 
members of its finance committee for the years 1936 and 1940. 
In order to maintain my amateur, or nonpartisan status, I also 
made the same request to the Republican National Committee. 
The responses disclosed a deplorable lapse of memory on the 
part of many well-known personages. 

Under date of Feb. 13, 1943 I received the following reply 
from the Democratic National Committee, signed by its dis- 
tinguished Chairman: 

Dear Mr. Ambruster: 

I sincerely regret that we are unable to comply with your 
request for a list of the Finance Committee of the Democratic 
National Committee for the years 1936 and 1940. Our Audi- 
tor, who has made a search informs me that no such lists 
are available. We have recently consolidated our quarters 
and in making the change the campaign lists of former years 
were disposed of. You will, probably, find these lists pub- 



TREASON'S PEACE 165 

lished in the metropolitan press of the years during the 
campaigns to which you refer. 

Sincerely yours, 

Frank C. Walker 

Not being able to find the information in the metropolitan 
press, I called at the committee headquarters in the Mayflower 
Hotel in Washington, and explained to a most gracious young 
lady that if they could not recall the names of all the members 
of the finance committee they might at least be able to tell me 
when Mr. McClintock started and stopped being a member. She 
assured me that she would ask someone who would know, and 
that I would then be advised. Apparently no one knew, as no 
further word was received. 

I also called at the Republican National Committee head- 
quarters and was told by Mr. Spangler himself that they had 
their records for at least ten years back, and that he would send 
me the lists very shortly. Apparently, however, they got lost, too. 

Meanwhile, not being too easily discouraged, I had written 
to Mr. James A. Farley at his New York address to see what he 
might remember. Mr. Farley's reply, dated March 3, 1943, was 
very discouraging except that it did not deny that Mr. McClintock 
had been a member of the committee. 

Dear Mr. Ambruster: 

I have your letter of March 1st, and am very sorry that 
I cannot give you the information you desire concerning Earl 
I. McClintock. 

For your information, a finance committee is appointed for 
the duration of a campaign. They exist until the campaign is 
over and then pass out of existence. We have no records 
here of the campaign committees for the years 1932 and 1936. 
I resigned as National Chairman the last of July and Ed. 
Flynn was not appointed until August 17th of 1940, and, as 
you know, I had nothing to do with appointing committees 
for that campaign. The list serves no purpose after election 
and there is no reason for keeping any records. It would 
appear that you are out of luck unless you can run across 



164 TREASON'S PEACE 

one of the old letterheads showing the names of the com- 
mittee. 

Very frankly, I did not know that Mr. McClintock ever 
served as chairman of the finance committee. I regret my 
inability to give you the information you desire, but know 
you will understand that it just isn't possible. 

Sincerely yours, 

J. A. Farley 

I next decided to try the New York Public Library document 
room but the only thing which bore on the subject was a copy 
of that celebrated 1936 Democratic Convention Souvenir book 
from which the party treasury received several hundred thou- 
sand dollars for advertising placed by numerous large corpora- 
tions. Incidentally, most of the advertisers described or pictured 
their products. One full-page ad, however, was what is known 
in the program agency business as a complimentary card, and 
just said, "Sterling Products, Inc." The editors of the book, or 
Sterling, either did not want the readers to know what Sterling 
Products was, or else they thought that everybody already knew, 
and that it was unnecessary to go into details. 

In this splendidly bound memorial volume of the convention 
at Philadelphia, there was a handsome photograph of James 
Aloysius Farley, chairman of the Democratic Party. Under and 
around the picture was a sketch written by the late J. Fred Essary. 

In view of my correspondence with Mr. Farley I was intrigued 
to read Mr. Essary's eulogistic description of him as the man who, 
"carried in his prodigious memory the names and identity of 
thousands of the faithful." This description recalled other things 
I had heard about Big Jim's card-index memory, so I wrote him 
again on March 11, 1943, saying: 

I guess I must have been misled by the many state- 
ments which I have heard and seen about the wonderful 
system of names and deeds kept by Big Jim, and the in- 
fallible memory, which gives up instantly every name 

which has contributed to the Party since he quit box- 
fights for the big show. 



TREASON'S PEACE 165 

As you say, I am just out of luck unless I can dig up an 
old letterhead or something. 

By a quite natural error my secretary addressed this letter to 
Washington instead of New York. And again a deplorable lapse 
of memory was recorded this time by the post office for some 
one had stamped the envelope, in big red letters, right over the 
name of James A. Farley, "No Such. Return to Sender." So, I for- 
warded the letter to Mr. Farley's correct address in New York 
with the notation, "What awful memories everybody is getting." 
Mr. Farley apparently did not see the joke; his reply indicated 
that he had nothing further to say about Mr. McClintock. (A 
few months later Mr. Farley was saying plenty about the war, 
"which," he was quoted as declaring "wasn't our war.") 

I also tried another prominent Democrat who had been Chair- 
man of the Party's Finance Committee in 1936, Mr. James W. 
Gerard. No luck there either, save another suggestion to seek 
the information from the Democratic National Committee. * 

During the period which Mr. Farley now forgets, Mr. McClin- 
tock's achievements as a Sterling executive included engaging 
the services of Mr. David Corcoran as an officer of the Sidney 
Ross Co., a Sterling subsidiary that distributes patent medicines 
in Latin America. Mr. David Corcoran was an automobile sales- 
man. He switched to patent medicines in the period when his 
brother, Mr. Thomas G. Corcoran, as a lawyer on the staff of 
the Reconstruction Finance Corp., was reputed to telephone Sen- 
ators and bureau chiefs with, "This is White House, Corcoran 
speaking." 

Disregarding for the moment the extent to which Mr. Corcoran, 
or Tommy the Cork, was ever authorized to speak for the White 
House, his welcome there was well known. Under the circum- 
stances, the addition of brother David to the payroll of Sterling 
was recognized as a master stroke on the part of Earl McClintock. 

As the decade preceding the fateful year 1939 progressed, Mr. 
McClintock spent more and more time in Washington. His status 
grew with his recognition as a factor in Democratic Party finances, 
and gained additional lustre from the new ties formed through 
brother David with that spoiled darling of the New Deal, Tommy 



166 TREASON'S PEACE 

the Cork. Many of McClintock's activities appear in other chap- 
ters. He intrudes here merely as a political angel the Democratic 
angel whom Farley can't remember. 

Thomas G. Corcoran originally was employed by the New York 
law firm of the late Joseph P. Cotton, President Hoover's Under 
Secretary of State who approved the huge loan made to Germany 
when the Nazis' rise to power began. He became counsel on the 
staff of the Reconstruction Finance Corporation in 1932 during 
the sad, dark days of the close of the Hoover administration. Cor- 
coran held onto the job when the Democrats came into power 
and became an important figure among the inside New Dealers. 

His fame rested upon a versatility which, as the legends grew, 
was said to include playing a piano with one hand, while writing 
New Deal legislation with the other. 

With due allowance for exaggeration the fact remains that Mr. 
Corcoran was a much more influential figure in Washington than 
his official responsibilities in the R.F.C. could have caused. He 
was too light in weight, and too young, to play on the varsity, 
but he was a big shot on the Washington campus. That he was 
a young man of great personal charm and nimbleness of mind 
was conceded by all who came in contact with him. 

Many of Corcoran's activities had no apparent relation to the 
R. F. C. This was especially true with regard to lobbying activities 
for legislation favored by the Administration. In 1935, in one 
such legislative battle, Corcoran was accused by Representative 
(now Senator) Ralph Brewster of Maine with having used im- 
proper influence and threats to induce Brewster to change his 
vote. Mr. Corcoran denied this charge and a Congressional Com- 
mittee that investigated the row spanked both Corcoran and the 
Congressman by expressing its disapproval of their actions, then 
absolved each from any suspicion of improper motives. 

Mr. Corcoran resigned his government job on Sept. 22, 1940 to 
direct what was called the Independent Voters Committee for 
Roosevelt and Wallace. His subsequent occupation in Washington 
raised a storm of criticism when reports began to circulate that 
Tommy the Cork was getting sizeable fees for using his New Deal 
influence to get war defense contracts and other official favors 
for his clients. 



TREASON'S PEAGE 167 

Among the official favors was one that bore directly upon na- 
tional defense. This was the arrangement whereby the investiga- 
tion of Sterling's tie-ups with I.G. Farben were concluded with 
the filing of "informations" and "consent decrees" instead of 
Grand Jury indictments which were contemplated by those mem- 
bers of the Justice Department who had started the dragnet in- 
vestigation of Sterling in April, 1941. In the Sterling case rumor 
had it that the Corcoran fee reached huge proportions. 

This scandal finally reached such proportions that in Dec., 1941, 
the Senate Committee to Investigate the National Defense Pro- 
gram (Truman Committee) began an inquiry and public hear- 
ings on lobbying. Corcoran appeared as a witness before this 
Committee on Dec. 16, 1941. "There are five stories," he testified, 
"which have been whispered about me as a symbol in connection 
with defense industries." In each of the stories thus defined by 
Mr. Corcoran, he testified that his services were strictly those 
of an attorney: in one instance he received no fee; in the others, 
a total of $100,000. (Which did not by any means represent his 
total business for the year.) They concerned a shipyard (organ- 
ized by a gentleman with a past), an engine contract, a magne- 
sium plant, an oil well in Alaska (that was never drilled) and 
Lend Lease supplies for China. Mr. Corcoran was emphatic in 
asserting that in none of these cases had he acted as a broker. 
He added to his denial, "And I don't know what a broker is, 
either." 

Senator Brewster, of Maine, then put the following statement, 
quoted from the public papers of Franklin D. Roosevelt, into the 
record: 

I have felt all along that it is not quite in accord with the 
spirit of the administration that any individual who holds 
a high party position should earn a livelihood by practicing 
law, because, in a sense, he holds himself out as having access 
to the backdoor of the administration. It just "is not done." 

Finally, Senator Joseph H. Ball of Minnesota, another member of 
the committee, attempted to question Mr. Corcoran about his re- 
lations with Sterling Products and the consent decrees. Mr. Cor- 
coran objected to discussing Sterling. 



168 TREASON'S PEACE 

Senator, that isn't a defense matter. I have certain confiden- 
tial relations with my clients. Very frankly, if this isn't a mat- 
ter of the kind that the committee generally is looking into, 
I would prefer not to go into that matter. I have always made 
it very clear that I was willing to talk about this with the 
Judiciary Committee or anyone else, but my own relation- 
ships with my clients are such that I would rather not discuss 
them in connection with Empire Ordnance, Savannah Ship- 
yards, and a lot of other things, because the public might 
get the impression that there was defense brokerage in Ster- 
ling Products. 

Unconvinced that the relations between Sterling and Farben 
did not relate to the national defense program, Senator Ball said: 

It seems to me that it ties in with this all-out war we are 
in, and also it certainly ties in with this question we have 
been discussing quite a bit here, of practicing before Gov- 
ernment departments. If we are to believe the newspaper 
stories, you had quite a bit to do with the appointment of 
Mr. Biddle (the Attorney General) originally, and then had 
quite a bit to do with him in developing this consent decree. 

Far from denying this last statement Mr. Corcoran indulged in 
a little modest self-praise regarding his part in arranging the 
Sterling consent decrees: 

I am being perfectly frank with you, Senator. I have always 
been perfectly willing to discuss the Sterling case, because, 
if you don't mind my saying so, I think it was a very far- 
sighted job. And as I told you before, when I last talked to the 
chairman of the Committee, I had just come back from the 
completion of the Sterling reorganization, which I think is 
one of the most brilliant things not from my point, but from 
the point of view of the action of the board of directors them- 
selvesthat has been done in the defense effort The 

only objection I am making is I don't want the Sterling busi- 
ness bracketed with an inquiry about defense brokerage 

I am concerned that the name of Sterling shall not be brack- 



TREASON'S PEACE 169 

eted in press reports and the rest of it with Charles West 
and Empire Ordnance and the rest of it 

The reader should keep in mind Mr. Corcoran's use of the 
phrase, "far-sighted job," in describing the Sterling Consent De- 
crees. The chairman of the Committee then ruled that: 

The committee will proceed with the program as outlined, 
and when that is finished, we will ask you to come back and 
discuss this under another heading. 

There followed some further discussion of Mr. Corcoran's keen 
desire to not testify about the Sterling case at that particular time. 
The chairman, Senator Harry S Truman finally recessed the Com- 
mittee, and thanked the witness with the advice that: "at a future 
date we will expect you to appear, Mr. Corcoran." However, Mr. 
Corcoran did not again appear before the Truman Committee 
to be questioned about the Sterling case or any other matter. 

The date of the first intercession in behalf of Sterling by Thomas 
Corcoran is a matter still shrouded in mystery. Requests made to 
various governmental departments to investigate this have been 
ignored or rebuffed. Yet he did so intercede even though his name 
does not appear in the list of attorneys who signed the consent 
decrees and other court papers for Sterling. That list includes 
the firm of Rogers, Hoge and Hills, the regular Sterling attorneys; 
and John T. Cahill, a former associate of Corcoran in the New 
York law firm of Cotton and Franklin who, with Corcoran's back- 
ing, had been United States Attorney at New York City from 
March, 1939, to March, 1941, during the period of the investiga- 
tion, trial, and acquittal of the only two directors of the McKesson 
& Robbins swindle who were ever brought even within speaking 
distance of the bar of justice. At that trial Howard Corcoran, an- 
other brother of Thomas, was in charge of the prosecution as 
assistant to United States Attorney Cahill. 

The two acquitted directors testified that they had never sus- 
pected Coster of wrongdoing. And it might be mentioned here 
that Howard Corcoran refused the testimony and the proofs which 
I offered to present to the jury at that trial, that it had long been 
well known to the drug trade that Coster was a common criminal, 



170 TREASON'S PEACE 

and that after the Hoover depression started, McKesson & Rob- 
bins was concealing its financial difficulties with fraud. 

Sterling Products and its chief executives were named on the 
list which I had already supplied those investigating the McKes- 
son & Bobbins mess as being among those who had knowledge 
of Coster's criminal activities. This list also included executives of 
the trade associations and trade papers which Sterling dominated. 

Mr. Cahill resumed the practice of law at about the time the 
Justice Department was beginning its dragnet inquiry into the 
Sterling-Farben relations. Robert H. Jackson was Attorney Gen- 
eral and in official circles he was regarded as "tough." Certainly 
he was not soft when he slapped court orders on Farben's huge 
deposits in the National City Bank, and instructed Thurman Ar- 
nold, head of the Antitrust Division, to turn the Farben mess 
inside out, no matter who was hurt. 

Then, on June 2, 1941, a long-expected vacancy on the Supreme 
Court occurred with the resignation of Chief Justice Charles 
Evans Hughes. Attorney General Robert Jackson was nominated 
to fill the Supreme Court vacancy, and according to Washington 
reports, one of the most active supporters for his promotion was 
Mr. Thomas Corcoran. Francis Biddle, then Solicitor General, 
was named to succeed Mr. Jackson as Acting Attorney General 
but was not actually nominated until spme two months later. 

Meanwhile, rumors of pressure in connection with the Ster- 
ling investigation abounded. In July, Messrs. Corcoran and Cahill 
held several long conferences at the Department of Justice,' at 
which consent decrees were proposed as an alternative to crim- 
inal indictment of Sterling and its executives. And, strange as it 
may seem, the conferences were not held with those members 
of the antitrust staff who were conducting the investigation. 

As a result of these discussions there was submitted to the Jus- 
tice Department a paper dated Aug. 15, 1941, and entitled, "The 
Sterling Representations to the Interdepartmental Committee of 
the Departments of State, Treasury and Justice." In this document 
Sterling, over the signature of its chairman, William E. Weiss, 
graciously promised to cancel its illegal contracts with Farben, 
and to obey all criminal statutes and war regulations of the United 
States Government. The crowning gem of the sixteen paragraphs 



TREASON'S PEACE 171 

in this promise to "go straight," was the agreement to remove any 
director, officer or employee of Sterling or its subsidiaries who 
was deemed by the Government to be engaged in any activities 
for the benefit of Axis powers or otherwise engaged in activities 
contrary to the national interest. 

This fantastic piece of impudence was the birth of Sterling's 
alleged repentance, reform and reorganization. It was the docu- 
ment which Mr. Corcoran later acclaimed as, "very far-sighted" 
and "one of the most brilliant things that has been done in the 
defense effort." 

Thurman Arnold's little band of determined investigators, how- 
ever, did not feel that it was either far-sighted or brilliant insofar 
as the national security was involved. Some of them refused to 
abandon their investigation, or to withhold from the grand jury 
evidence already gathered which involved Sterling's executives 
in subversive relations with Farben leaders. And resignations, to 
be accompanied by public statements, were threatened. 

Just about this time items began to appear in the press that 
all was not well inside the Department of Justice with regard 
to the Sterling case. The Washington Times Herald published 
a full-page Sunday feature story about the "young man who 
practices law out of his hat," which quoted Mr. Corcoran as say- 
ing that he wanted to make a million dollars in a year practicing 
law, and then re-enter official life and spend the rest of his days 
improving the Government. 

Referring to the Sterling investigation, the article stated that 
Tommy's brother David did not want to be bothered by the 
Department of Justice about those who had been holding up 
the price and keeping down the production of drugs and chem- 
icals essential to the prosecution of the war, and went on to 
say: 

Dave Corcoran is an officer of Sidney Ross & Co of 

Sterling Products somehow Sterling Products has got 

itself tangled up in a Department of Justice investigation 

Tommy, with Cahill and brother Dave is defending 

Sterling's interests. The temperature in the air-conditioned 
Department of Justice is said to have risen on occasion to 



172 TREASON'S PEACE 

something more than blood heat. "Tommy can't get it through 
his head," reports one observer, "that he is not in the Govern- 
ment any more." 

Pearson and Allen in their Sunday night broadcast on Aug. 17, 
1941, announced that a big explosion was due inside the Depart- 
ment of Justice if criminal prosecution was not pressed of Ameri- 
can firms for their cooperation with Germany on restraint of trade. 
"A high departmental official" stated the broadcasters, "is holding 
back the prosecutions." 

On Aug. 25, 1941, Mr. Biddle was finally nominated to the office 
of Attorney General. On Sept. 4, the Senate confirmed the nomina- 
tion, and the next day the Sterling consent decrees were made a 
matter of record in the District Court of New York. In just one 
particular Messrs. Corcoran and Cahill had been compelled to 
yield ground. Thurman Arnold and his staff insisted that the pro- 
ceedings must have some relation to the criminal provisions of 
the law, so an information was filed in the criminal court against 
Sterling and its three subsidiaries: Bayer, Winthrop and Alba, 
and two of its officers: Messrs. Weiss and Diebold. All pleaded 
No/o contendere, and were fined a total of $26,000. This sum repre- 
sented an infinitessimal fraction of the illegal profits made by 
Sterling as result of the unlawful Farben agreements. The sub- 
versive activities of the Sterling executives could not be even con- 
sidered for the good and sufficient reason that they were not 
mentioned in the information. 

The consent decrees purported to abrogate the formal agree- 
ments with Farben, seven of which were recited at length. How- 
ever, it is doubtful whether Farben will recognize the abrogation 
of its agreements with Sterling any more than its predecessors 
recognized the seizure of Bayer during World War I. For one 
thing these Farben agreements contained clauses requiring Ster- 
ling to settle any questions relating to them in a German court, 
for another, it has been admitted by a representative of Sterling 
that William E. Weiss sent a message to his Farben friends in 
Germany not to worry about what was going on in the United 
States because Sterling would find ways of continuing its rela- 
tions with its Farben associates. 



TREASON'S PEACE 173 

It should also be pointed out that the Treasury's freezing of 
foreign funds and property and the black lists of foreign nationals 
issued by the Secretary of State already effectually restrained 
all relations between Sterling and Farben. So the alleged conces- 
sions by Sterling, as stipulated in the consent decrees, were an 
empty gesture by which Sterling gave up nothing that was not 
already forbidden or impossible. In reality the decrees had just 
two positive effects, they served to prevent indictment and pros- 
ecution of Sterling's executives, and they put a stop to the Justice 
Department investigation of subversive activities by some of the 
Sterling people that was then in progress. 

An official statement issued in the name of Attorney General 
Biddle, at the time the consent decrees were recorded, contained 
allegations and conclusions which were so at variance with facts 
known to exist that a wave of caustic criticism arose immediately. 
Stories appeared in the press about the open rebellion which 
existed inside the Justice Department, due to Corcoran's brazen 
actions, and also because evidence prepared for submission to 
the grand jury was being pigeonholed. Mr. Biddle's statement of 
Sept. 5, it was said, was actually prepared by Corcoran, and read 
like a Sterling patent-medicine advertisement. 

On September 25, another official press release was issued about 
the Sterling case (this time in the name of Thurman Arnold) 
which also contained statements completely the reverse of facts 
apparent on the record. Men who knew Mr. Arnold and were 
familiar with the vigorous language of his privately expressed 
opinions, were confident that he had not prepared this second 
apology for the consent decrees, and that it must have been issued 
over his protest. 

Among the more absurd allegations in the Arnold press release 
was the statement that: 

The illegal contracts (with Farben) were entered into in 
1926 long before the Hitler revolution. 

On the record, the consent decrees listed seven illegal contracts 
of which three were entered into in 1936, 1937 and 1938, long 
after Hitler seized power in Germany. Another statement in the 
release argued that: 



174 TREASON'S PEACE 

The Sterling organization must not be destroyed, nor its ef- 
ficiency hampered, in the present emergency, because of the 
necessity for American outlets for drugs in this hemisphere. 

The falsity of this argument was self-evident. The Sterling-Far- 
ben branches in Latin America had to be abolished, and the 
purpose of the decrees was not to preserve the existing Sterling 
organization, but to destroy those outlets for all time. Whoever 
prepared that statement for Mr. Arnold's official rubber stamp 
had small regard for the lustre of Mr. Arnold's name. 

While this press release was issued in the name of Assistant 
Attorney General Arnold, copies of it were mailed out over the 
signature of one James Allen' as "Special Executive Assistant to 
the Attorney General." Mr. Allen, according to press reports, was 
one of the numerous young men originally brought into the gov- 
ernment service by Thomas Corcoran. Mr. Allen turned up later 
in the Office of War Information where, in April, 1942, he was 
one of the higher-ups said to be responsible for the resignation 
of a group of writers who issued a statement that they were get- 
ting out of the O.W.I, because it was impossible to tell the full 
truth when those in control were turning the O.W.I, into an office 
of war ballyhoo. Later it was reported that Mr. Allen was again 
Mr. Biddle's assistant, this time at the Nuremberg trials of Nazi 
war criminals. 

One of the most notable aspects of the Corcoran, Trojan-horse 
trade with the United States Government, was the fact that only 
two of the executives and directors of Sterling were named in 
the criminal informations as in any way involved in the unlawful 
agreements with Farben. 

Mr. McClintock, chief aide to Mr. Weiss in the Farben rela- 
tions, was not named, nor was Mr. Rogers whose active legal 
mind worked on the details of some of those illegal agreements 
and whose signature actually appears on one of them. 

Others whose names were conspicuously missing in the informa- 
tions are James Hill, Jr., director and treasurer of Sterling and 
of Sterling subsidiaries; William E. Weiss, Jr., president of Alba; 
and Dr. William Hiemenz, Farben's director and plant manager 
of Winthrop. All of these obviously had something to do with 



TREASON'S PEACE 175 

carrying out the contracts with Farben as covered by the infor- 
mation, and the pleas of nolo contendere. Dr. Hiemenz stayed 
right on as manager of Winthrop until O'Connell's Treasury 
squad showed him the door several months after the consent 
decrees had, by negative action, coated him with nice fresh 
Corcoran whitewash. 

Another notable who had retained his seat at the Sterling board 
as one of the consent decree "unmentionables" is one George C. 
Haigh, whose contact with Sterling goes back to September, 1918, 
when A. Mitchell Palmer, as Alien Property Custodian, made him 
a director of the Bayer Co. 

In 1919, after Sterling took over and pledged to keep Bayer 
inviolate from any return of German influence, Mr. Haigh was 
made a director of Sterling. He continued as a director all through 
the negotiations of the long string of illegal contracts and agree- 
ments which violated in spirit and in letter the pledge and the 
purpose of the Americanization of Bayer. 

Others were involved, but the above-mentioned principals are 
sufficient to indicate the fine legal work done by Mr. Corcoran 
in consummating his far-sighted and brilliant contribution to our 
national defense. 

It may be relevant at this point to cite from the Canons of Pro- 
fessional Ethics of the American Bar Association, with which Mr. 
Corcoran, no doubt, is familiar. 

The responsibility for advising questionable transactions 
for urging questionable defenses, is the lawyer's respon- 
sibility. He cannot escape it by urging as an excuse that he 
is only following his clients instructions "When a lawyer dis- 
covers that some fraud or deception had been practiced, 
which has unjustly imposed upon the court or a party, he 
should endeavor to rectify it." The canons of the American 
Bar Association apply to all branches of the legal profession; 
specialists in particular branches are not considered as ex- 
empt from the application of these principles. 

Many of the American newspapers accepted Mr. Biddle's state- 
ment on the consent decrees as conclusive and final, some even 
commended the outcome. Time, on Sept. 15, exclaimed exultingly: 



176 TREASON'S PEACE 

The Justice announcement last week gave Sterling a clean 
bill of health as far as further Nazi influence is concerned. 
This, it hoped, might undo some of the damage done by 

Arnold's previous blasts The Sterling deal was Tommy 

Corcoran's fourth big job since he left the R.F.C. last year. 

In view of the amount of advertising with which Time and Life 
have been favored by American affiliates of Farben this rather 
crude bombast in one of the Henry Luce publications may war- 
rant calling attention to an accusation published by columnist 
Leonard Lyons in the New York Post that Time had slanted a 
story in favor of a Luce advertiser, and that its managing editor, 
T. S. Matthews, had confessed that his stories definitely were 
slanted. 

The admission made publicly by the Time Editor was that: 

Facts are the raw material common to the whole press, 

but the products are as different as the men who run 

the papers a sane journalist cannot be completely im- 
partial the stuff he writes will be definitely slanted 

Leading trade papers also were jubilant. Drug Trade News, 
companion publication to Drug Topics, which admittedly is sub- 
sidized by the drug manufacturers, came out with an editorial 
rejoicing that "there was no evidence of willful wrong-doing on 
the part of Sterling and its subsidiaries." 

Other press comment, however, was decidedly critical. PM, 
Marshall Field's New York daily paper, had already published 
several informative articles regarding the Sterling-Farben tie-ups 
and its comments on the consent decrees and on the Biddle and 
Arnold press statements were numerous and caustic. 

The most devastating criticism, however, appeared in a long 
series of articles by Thomas Lunsford Stokes, Jr., Scripps-Howard 
feature writer, and probably the most feared of those Washing- 
ton correspondents who consider it their function to seek out and 
write the truth, regardless of the high places or the immaculate 
shirt fronts of the personages involved. Mr. Stokes, winner of the 
Pulitzer Prize in 1938 for exposing political monkey business in 
the W.P.A., performed a notable public service in writing a de- 



TREASON'S PEACE 177 

tailed running story of the lobbying activities of Corcoran in con- 
nection with the Sterling case. 
On Sept. 15, Mr. Stokes' comments included: 

Consent decrees have left a sour aftermath in the 

Antitrust Division of the Justice Department The dis- 
satisfaction attributed to: (1) The pressure and pull exerted 
by Thomas G. Corcoran, one time New Deal brain truster 
and now a lawyer-lobbyist who represented Sterling. (2) 
Failure of the government to take the evidence before a 

grand jury and the terms of the consent decrees, which, 

in the opinion of some are not as strong as they might be and 
might become unhinged after the war. (3) The fact that 
settlement was imposed from the top by Attorney General 

Biddle Mr. Corcoran is an old friend of Mr. Biddle. 

He was influential in bringing Mr. Biddle into the administra- 
tion and was active on behalf of Mr. Biddle's recent promo- 
tion from Solicitor General to Attorney General. 

Mr. Corcoran practically camped in Mr. Biddle's offices 

was given access to secret information of the department 

and contributed to the writing of the statement for the 

press which is described by those who know the facts as 
whitewash, with misleading inferences and actual misstate- 

ments Investigators were still at work when the 

settlement was reached and the consent decrees taken into 

the court They were called from their inquiry, which 

was turning up some evidence which does not appear in the 

'information' nor in the consent decrees, and is now a 

closed book unless it is called for by Congress. 

On Sept. 17, Mr. Stokes' column contributed the following: 

A federal grand jury never got to hear the evidence dug up 
by the Department investigators It can be stated author- 
itatively that they were turning up some rather sensational 
evidence about operations of subsidiary companies of Sterling 
Products, Inc. in South America, evidence which leaves a 
question mark as to the efficacy of the consent decrees de- 
signed to drive the Germans out of that market Who 



1 7 8 

stopped the investigation? Who stopped submission of the 
evidence to a Grand Jury? 

From December, 1939, to April, 1941, Bayer shipped aspirin 

to I.G. (Farben) agencies in South America made in 

the United States but packaged just like the German product. 

The income of German agents of I.G. Farben in South 
America was increased during the war by Sterling's pay- 
ments to them for the distributing of Bayer In at least 

one case, in Colombia, one of these agents, manager of a 
local company there, heads the Arbeitsfront in the Nazi or- 
ganization Dr. E. Wolff, arrested in Panama with a 

trunk containing various documents, was tried and fined. He 
was on his way from Berlin to Buenos Aires to work in an 
I.G. Farben factory. 

On Sept. 18, Mr. Stokes' column on Sterling and Bayer went 
back to the days of World War I and expressed the fear that his- 
tory might repeat that after this war the Germans might again 
gain a position of dominance in our chemical and allied indus- 
tries. This article again castigated Corcoran as a lobbyist for Ster- 
ling, and brought Earl I. McClintock into the picture as one of 
those who used his official friendships during the negotiations to 
stop the Sterling investigation from going any further. 

Another phase of the investigation revealed by Mr. Stokes was 
the fact that a grand jury, if it had been permitted to examine the 
evidence assembled in the Justice Department, might have acted 
upon: 

The expenditure by Sterling in the last eight years of large 
sums for advertising in pro-Nazi newspapers in Latin Amer- 
ica while only negligible advertising was done in the anti- 
Nazi papers/' 

On Sept. 19, Mr. Stokes discussed Mr. Corcoran's part in the 
preparation of the Biddle press release saying: 

This may not be the first time that a private citizen, repre- 
senting defendants in an antitrust case, has supervised the 
writing of a government press release but it is the first one 



TREASON'S PEACE 179 

that anyone seems to know about; and certainly takes the 
prize for flagrancy. 

Soft-spoken Raymond Clapper, Scripps-Howard columnist and 
colleague of Stokes, used very strong language about Corcoran's 
lobbying just as he had in 1932 about that other ex-official, Ed- 
ward T. Clark. On Oct. 7, he concluded his comments with: 

What is to be the effect on these junior officials, working on 
moderate salaries, when they see this cynical kind of funny 
business going on in the very heart of the New Deal? 

On November 27, 1941, The New York Times discussed "lobby 
lawyers" in an article which referred to Mr. Corcoran's activities, 
and quoted Mr. Biddle as stating that he planned no investigation 
of lobby contracts: 

Such lobbying, Mr. Biddle said, would be inquired into 
if the Department of Justice was so directed by some proper 
agency, but not otherwise. 

According to the Times, when asked, if he thought he or other 
government officers should make public the names of ah 1 persons 
visiting their offices, the Attorney General replied that he thought 
it would be very inappropriate to give out such names, and that 
the public must depend upon the honesty of its officials. (Three 
years later one of Mr. Biddle's chief assistants was to denounce 
the handling of this case in damning terms. ) 

I have already mentioned that I had some part in inducing 
the Justice Department to investigate Sterling. Also, I had been 
supplying the Department with historical and background data 
which bore upon Farben's activities in the United States, and the 
conspiracies and subversive activities of those involved with Far- 
ben. 

In some instances, at least, my aid was of value, and on more 
than one occasion I was officially thanked for my assistance. In 
any event, I was sufficiently close to what went on both inside and 
outside the Department, relative to that investigation, to recog- 
nize the danger signs as they began to be visible, and to realize 
that regardless of the integrity and high purpose of those young 



i8o TREASON'S PEACE 

men of Arnold's, the quarry would not be brought to bay unless 
the scope and broad purpose of the hunt was enlarged. Accord- 
ingly, immediately after the records of Sterling and Winthrop 
were subpoenaed, I sent Mr. Arnold a number of exhibits which 
brought out the fact that the Washington lobby had never been 
identified in the public mind as representing other than American 
interests. My letter, dated April 15, 1946, stated that: 

In view particularly of the refusals of the Senate Lobby 
Committee of 1929 and 1935 to investigate the lobby main- 
tained in Washington by these people I do not believe 

that your own efforts can ever be effective unless this lobby 
is included in your investigation and action. The present 

lobby includes some of those mentioned by me as being 

paid, directly or indirectly, by the German government. 

That communication was never acknowledged by Mr. Arnold. 
Perhaps the lobby saw to it that it never reached his eyes; cer- 
tainly he never mentioned it to me afterward. However, Thurman 
Arnold cannot say that I did not attempt to warn him of what 
was going to happen to his Sterling case, and to some of his other 
Farben investigations, if he did not use a repeating rifle on the 
Farben partners and a shotgun on the Farben lobby. 



CHAPTER 



Senators and Congressmen Who 
Never Knew 



MENTION IS 

made elsewhere of the concealed interference by the German dye 
trust with tariff and patent legislation; also the strange desire 
of members of the House and Senate to force through the act 
of 1928 for the payment of claims and the restoration of German 
property which had been seized in the First World War. One of 
the Senators who joined with King and Moses to help put through 
that 1928 statute, was Doctor Royal S. Copeland. 

The nonpartisan broadmindedness of the German dye trust in 
chosing its American friends is shown by the fact that Copeland 
held office and was a candidate, from time to time, as a Repub- 
lican, a New Deal Democrat and an anti-New Deal Democrat. 
Farben also appeared to have no objections to the friendship of 
a doctor whose medical attainments did not qualify him for mem- 
bership in his own county medical society, or for the dubious 
honor of belonging to the American Medical Association. Cope- 
land once made the claim that he was a former professor in the 
Medical School of the University of Michigan but, according to 



182 TREASON'S PEACE 

the University authorities, his teaching experience was in a de- 
funct homeopathic college which was in no way related to Michi- 
gan's famous school of medicine. 

As a Senator and a doctor of medicine, Copeland's name and 
picture and voice were seen and heard in press advertisements 
and radio broadcasting for patent medicine or home remedies, 
as they were politely termed. And among those advertised nos- 
trums were preparations manufactured and sold by two of the 
leading American affiliates of I.G. Farben Sterling Products and 
Standard Oil of New Jersey. Such arrangements for the Senator's 
services were presumably made at the New York offices of Cope- 
land Service, Inc., where one Ole Salthe, his manager (of whom 
more later), was also prepared to arrange for the advice of the 
Senator on matters pertaining to the enforcement of Food and 
Drug Laws. These were, of course, strictly business or semipro- 
fessional arrangements and bore no relationship to the Senator's 
engagements as a statesman, or his daily newspaper contributions 
as a literary authority on public health matters. 

As to his kindly feeling towards I.G. Farben and its affiliates, 
our Senatorial healer made the record very clear in a speech on 
the Senate floor on February 21, 1928, just before the final approval 
of the statute to pay Farben's claims and to return Farben's prop- 
erties. His address, in part, was as follows: 

Can we doubt that international business partnerships are 
the best preventative of international wars and conflicts that 
statesmen can devise? It is time to cease ringing the changes 
upon war hatreds and animosities, and extend the helping 
hand of friendship to our former enemies 

Let it be remembered that some of our infant industries 
are predicated upon the confiscated inventions of the people 
of a nation originally invited into our midst by the terms of 
our Constitution. No compensation has ever been paid to 
them. I am glad they are to be paid under the terms of the 
bill passed yesterday 

The domestic problems of farm relief, of national defense, 
of destruction of industry by ruinous foreign competition, 
would be brought nearer 'to solution by such commercial 



TREASON'S PEACE 183 

alliances. The occupation of some paid Jeremiahs constantly 
prophesying war and woe would probably be rendered super- 
fluous 

Let us have done with vituperative attacks on nonexistent 

enemies we have read from time to time in the chemical 

trade journals and in the lay press of how wicked, designing, 
unashamed and dangerous were those corporations whose 
patents we confiscated for the benefit of a privileged few 

European combinations in these industries provide addi- 
tional products for farsighted Americans who have formed 
alliances with the possessors of the 'know how/ The question 
is shall we welcome alien industry and capital to our shores, 
in accordance with the traditional policy of our nation, or 
shall we lend ear to the affrighted clamor, denunciation and 
invective of a selfish minority? It is high time that we had an 
official expression of the administration's attitude in the in- 
terests of world peace and domestic prosperity. 

American capital is hesitant. American industrialists are 
reluctant to enter into agreements with other manufacturers 
to obtain for this country that which we have not, and which 
would be of benefit to us, so long as the newspapers are filled 
with vituperative abuse and vague suggestions of Sherman 
Act prosecutions. 

This address is important to this story because it records the 
beginning of the second postwar decade when Farben and its 
American stooges had decided that everything was under control, 
and therefore their plans for expansion could be more open, with 
safety to all concerned. The speech is also important because it 
is a condensation of substantially every false argument and sophis- 
try of Farben propaganda. Copeland also, unwittingly, recorded 
officially the unheeded protests at Farben's comeback, and the 
unheeded demand for Sherman Act prosecutions. Copeland, in 
the name of the United States Senate, was bidding Farben wel- 
come just as the Hoover subordinates, and Donovan, in the name 
of the executive branch of the government had extended a similar 
invitation a few days earlier, as related in Chapter vn. 

From its earliest days, the German dye trust has utilized the 



184 TREASON'S PEACE 

patent laws of the United States to obstruct, cripple or control 
our dye, drug, and chemical munitions industries. The president 
of the American Bayer company, acting on instructions from Ber- 
lin, persuaded the State Department to send our Commissioner 
of Patents as a delegate to the International Patent Convention in 
Stockholm prior to World War I. The result was that our unsus- 
pecting commissioner wound up as the guest of honor on Kaiser 
Wilhelm's yacht, and upon his return was in complete accord with 
the desires of his Teutonic hosts. 

As a result, the United States negotiated a new treaty with Ger- 
many which complied with the dye trust's wishes that the work- 
ing of a patent in either country was sufficient to protect the in- 
ventor, or his assignee, in both countries. And the president of 
Bayer boasted openly of his smart trick in getting the Kaiser to 
help soften up our patent laws. 

Meanwhile Herman Metz turned up on the Congressional Com- 
mittee on patents. Metz was irritated at any attempt to interfere 
with the rights of his German friends to do as they pleased, saying: 

Legally there could be no reason at all why the Germans 
should not obtain a patent in this country for which a patent 
could be obtained, and do with that patent what they 
pleased. 

Again Metz declared that German patents: 

have no value a ssuch except for the purpose of 

keeping out infringing products. They are simply clubs to 
keep out other manufacturers. 

After World War I, when tariff and embargo barred German 
imports, the dye trust began using its patents to implement the 
illegal tie-ups by which it reestablished itself in the United States. 

It is obvious that this reestablishment would not have been pos- 
sible if our antitrust laws had been enforced. Nor would it have 
been possible had Congress interceded to prevent misuse of 
United States patents, especially those relating to the national 
defense. 

Can anyone doubt that Congress would have been compelled 
to take drastic steps had Mr. Teagle, or Mr. duPont, or Dr. Weiss, 



TREASON'S PEACE 185 

or even Herman Metz, ever protested to Congress or even to the 
public at the illegal agreements proposed by Farben. The fact 
is that they did neither. 

All through this second prewar period the public was largely 
uninformed, or greatly misinformed, about these Farben tie-ups. 
But the record proves that Congress had known for many years 
that the more important of the illegal agreements were in opera- 
tion, and that others were in the making. 

Members of the Senate and the House of Representatives un- 
covered evidence of the dye trust's plans and agreements in al- 
most every session of Congress from the end of World War I to 
the beginning of World War II. They also knew the identity and 
the activities of the horde of lobbyists who haunted the hallways 
of the Capitol and the bars and club-rooms of Washington in 
the interests of Farben and Farben's American partners. 

Despite this knowledge Congress did nothing until the 1941 
and '42 exposures and prosecutions. Then loud were the lamenta- 
tions of some of its members at the "surprising" revelations of 
what Farben had been doing to keep the United States disarmed. 

In order to comprehend the breadth and scope of the Farben 
pattern, we might examine some of the crocodile tears shed so 
publicly at not knowing things that had been blazoned on the 
records of Congress all along. It is necessary also to observe how 
these facts come to be on those records, and what influences may 
have caused them to be ignored. 

One member of the Senate who in 1942 appeared not to know 
anything about the Farben tie-ups in the United States was the 
Honorable Scott W. Lucas, Illinois Democrat, who was elected 
to Congress in 1934 and moved up to the Senate in 1938. 

In April, 1942, Senator Lucas, as a member of the Patents Com- 
mittee, made some comments about the ignorance of official Wash- 
ington regarding the activities of I.G. Farben. An official of the 
Justice Department had just testified that some of Farben's illegal 
affiliations had been secret until the Attorney General's office 
went into their files. Said Senator Lucas: 

But before the Attorney General's office went into the 
files to inspect these documents nobody in the government 



186 TREASON'S PEACE 

as I understand it, or in this country, knew anything about 

these international cartel arrangements 

I am not condemning anyone particularly for what hap- 
pened in the past, but I am speaking for the future. We all 
learn by experience. This country ought to have a right at 
least to examine and ascertain whether or not a contract of 
this kind, if it went into effect, would affect the life and se- 
curity of the United States. 

Anxious as the Senator appears to have been to learn by experi- 
ence, something must have caused him to conclude otherwise, 
because he was one of the five members of the Senate Patents 
Committee who later voted to prevent Senator Bone, its chairman, 
from continuing these hearings into Farben's agreements with 
Sterling, and the relations of the Sterling executives with subver- 
sive activities of their German partners. 

Senator Tom Connally, Texas Democrat, started as a Congress- 
man in 1917 and became a Senator in 1929. The Senator is re- 
puted to be a political colleague of former Governor William P. 
Hobby of Texas, who, with the late W. S. Parish, organized the 
Humble Oil Co., and sold control of that company to Standard. 
Senator Connally contributed a naive conclusion as to the inno- 
cence of all concerned about Farben's intentions. The Senator was 
a member of the Truman Committee which was examining Mr. 
Farish of Standard Oil in March 1942 at a closed hearing. When 
Mr. Farish appeared uncertain as to just what testimony he should 
give about Standard's relations with Farben, Senator Connally 
asked him: 

When you entered into these negotiations with Farben 

in Germany did you do it with any contemplation of 

war or of our becoming involved in war and needing these 
articles in the way that we now find ourselves needing them? 
Or was it simply a commercial business transaction that you 
were contemplating? 

Mr. Farish responded: 

It was always. Senator, on a commercial or business basis, 
and with only commercial objectives in mind 



"TREASON'S PEACE 187 

Senator Homer T. Bone, Washington Democrat, came to the 
Senate in 1932, and two years later sat through the lengthy hear- 
ings of the Senate Munitions Investigating Committee which went 
deep into the Farben activities. In 1942 Senator Bone, as Chair- 
man of the Senate Patents Committee, investigated the activities 
of Farben for several months until the aforementioned five mem- 
bers ganged up on him and refused to permit the investigation 
to be completed. 

At these 1942 hearings Senator Bone did recall that the subject 
was not a new one, but he also indicated an unfortunate lack of 
memory about the revelations before the Nye Munitions Commit- 
tee and elsewhere concerning Farben. The Senator's comment 
was: 

I know little about LG. Farbenindustrie in Germany be- 
cause it is shrouded in mystery. I know back in 1934 and '35 
when I served on the Senate Munitions Committee, we were 
not able to get anything definite out of Germany. There was 
great secrecy manifested even in some of our own depart- 
ments At that time I was fearful that what our nationals 

were doing might be aiding in the rearmament of Germany, 
thus making her a menace to the world. 

Assistant Attorney General Thurman Arnold, while testifying 
before the Truman Committee in March, 1942, paid a peculiar 
tribute to his own belated investigation of the Farben tie-up ar- 
rangements, and put the entire blame for the continuance of these 
agreements on the lax enforcement of the anti-trust laws during 
the Hoover Republican administration from 1929 to 1933. For 
some reason he did not mention that this lax enforcement con- 
tinued right on from 1933 to 1941 during the Democratic adminis- 
tration, Mr. Arnold's comment in part was that: 

The cost of preventing such cartel restrictions in the fu- 
ture is eternal vigilance and the existence of a wide-awake 
investigating agency to enforce the Sherman Act. Had there 
been such an agency operating in 1929, had this conduct 
been actually hazardous at that time, these arrangements 
would never have been contemplated. But from 1929 to 1933 
business men felt safe from discovery. 



i88 TREASON'S PEACE 

In view of these and other Senatorial-Congressional expressions 
of ignorance about what Farben was up to, it is of interest here 
to refer to some of the extensive evidence available, from 1919 
to 1939, to members of the House and Senate. 

This consideration is warranted in order to understand the pre- 
cise detail with which the Congress of the United States first ex- 
plored and recorded the activities and purposes of the German 
dye-trust leaders, then ignored its own findings and finally, when 
disaster had arrived, began pitifully weeping "we didn't know." 
It is for the reader to decide from these facts whether the repre- 
sentatives of the American people were dolts or knaves or an 
unhappy combination of both. 

During the decade that followed the close of the first World 
War, the German Dye Trust was the subject of many hours of dis- 
cussion and thousands of pages of testimony before committees 
of the Senate and House. Later hearings brought out more facts 
about Farben; about its lobby and campaign contributions; about 
its industrial tie-ups and subsidiaries; and about its propaganda 
and its expenditures for espionage and other subversive activities. 

From 1919 to 1922 there were a number of hearings before the 
committees of the House and Senate which recorded the testimony 
of a great number of witnesses who argued whether high tariff 
duties or an absolute embargo would best protect the new Amer- 
ican dye industry from the threat of German imports. At these 
hearings there was very little left unsaid about what Farben's 
predecessors in I.G. Dyes would do to this country's new chemi- 
cal industry if they were given the opportunity; or of the proba- 
bility of another war of conquest, if and when Germany got the 
chance. 

When the next war did start more than a dozen members of 
the Senate, and several times that many members of the House, 
still occupied the same positions at Washington as they had dur- 
ing those early hearings at which the records and plans of the 
German dye trust were spread upon the Congressional records. 
A number of these legislators were members of the committees 
that held the hearings. Coming down to the 1934^1936 period 
when further hearings delved deep into Farben's consummated 
plans, we find that an actual majority of the members of both 



TREASON'S PEACE 189 

chambers were still representing their constituents when the last 
war began. 

It would appear from the record, therefore, that the failure of 
Congress to act has not been due to lack of ample information 
about Farben, nor to lack of repeated warnings as to what dis- 
aster that neglect might bring about. 

There were many charges and countercharges against lobbyists 
and German agents at those early hearings. Francis P. Garvan, 
among others, made definite charges that the German dye trust 
had attempted to influence legislation in the past and was still 
doing so at the very time that Senator King and his campaign- 
fund contributor, Herman Metz, were denouncing everyone who 
wished to protect America's new chemical industry. Garvan ac- 
cused Metz of standing on the floor of Congress, as representa- 
tive of the German I.G., shaking his fist at American manufac- 
turers in the gallery and exclaiming, "I got you licked I got 
you licked." 

"And then/' said Garvan, "we were like the blind beggar at 
the gate in Kipling's story, 1 cannot see my enemy but I can 
hear his footfalls.' " 

In another of the Senate hearings in 1920, before the Finance 
Committee, Mr. Irenee duPont, president of the duPont Company, 
made the rather remarkable request that in addition to embargo 
and high tariff to keep out German dyes, Congress might well pass 
legislation which would authorize some government official to set 
aside the Sherman Act as it applied to the dye industry, if, in the 
opinion of the official, it became necessary for the dye manufac- 
turers to get together on short notice to exchange information. 

Congress did not then pass such a law, but Mr. duPont had 
little cause to complain about any enforcement of the Sherman 
Act until Thurman Arnold got busy after World War II had 
started. Then duPont and all the other leading American dyestuff 
makers were indicted for conspiring with I.G. Farben, and the 
Congress kindly did permit the Attorney General to waive or 
suspend prosecution of all concerned on the pretext that prosecu- 
tion would interfere with the war effort. The case finally ended 
when duPont, among others, pleaded nolo contendere and took 
a fine. But that belongs in another part of this story. 



190 TREASON'S PEACE 

There was much testimony in these early hearings which gave 
unmistakable warning of what the German dye trust might do 
when the next war should come. Here, again, it was Francis Garvan 
who put those warnings into pungent, dramatic form which, it 
is hoped, some members of the Senate may now recall with shame. 

Time and again Garvan denounced the German dye leaders as 
a menace to the peace of the world in the future as in the past. 
For example, in 1920 he warned the Senate Finance Committee: 

Industrial Germany waged this war; and industrial Ger- 
many was the first to see defeat, and forced the military peace 
in order that with her industrial equipment intact she might 
continue that same war by intensified and concentrated eco- 
nomic measures. It was Germany's chemical supremacy that 
gave her confidence in her avaricious dream of world empire, 
it was Germany's chemical supremacy that enabled her to 
wage four years of pitiless warfare, and it is Germany's chemi- 
cal supremacy upon which she relies to maintain the war. 

Another emphatic warning was sounded to members of the 
Senate by Dr. C. J. Thatcher, one of the smaller dye manufac- 
turers, when he told that same Senate Committee: 

"No matter what importers or their friends of Germany 

may say The ruthless war for chemical domination by 

Germany, started at least as early as 1880 was not 

ended by the Armistice or by the Treaty of Versailles 

any treaty, law, or other provision which a German can by 
any means avoid in the warfare for industrial chemical su- 
premacy is, just as in actual warfare, 'a mere scrap of paper.' " 

Rear Admiral Ralph Earle, Chief of the Bureau of Ordnance of 
the Navy Department, also gave the Senate some words of advice 
at that time which were complacently forgotten. In discussing the 
need for encouraging and protecting our coal-tar industry as a vital 
measure of national defense, Admiral Earle said, in part: 

During the war we used as much toluol as could be ob- 
tained, but the production of that material was not suf- 
ficient Time is a very important element in 



."*. TREASON'S PEACE 191 

reference to war from the standpoint of national de- 
fense we do not think we ought to be put in that position 
again. 

The admiral also advised the committee that the production of 
synthetic drugs from coal tar should be encouraged through pro- 
tection of the industry, as coming under the general head of 
preparedness. 

Another unmistakable warning is to be found in the report of a 
Senate Finance Subcommittee in 1920, which said, in part: 

One who has read the story of the German Government 
in the United States just prior to the war, knows that the 
chemical industry in this country which was under the con- 
.trol of the German Government was the center of espionage, 
German propaganda, and direct government activities. They 
prevented the use of coal-tar products in the munitions in- 
dustry 

We know what Germany will do to regain her hold on the 
industry in this country. We know that she will resort to state 
and cartel combinations, trade export premiums, dumping, 
bpbery, espionage and propaganda. She did this before, and 
she will do it again. 

In 1930 the records of the Senate Lobby Committee were em- 
bellished with a detailed history of the I.G. Farbenindustrie which 
was presented by Senator Arthur R. Robinson of Indiana. This 
document had been filed by the American I.G. Chemical Corp. 
with the New York Stock Exchange, and it included much infor- 
mation regarding the enormous size and growth of Farben; its 
huge production of synthetic nitrogen and its other products. The 
1929 agreement between Farben and Standard Oil was described, 
and the negotiations for later tie-ups were mentioned. 

Senator Robinson's minority report, with which Senator Cara- 
way, its chairman, and other members of the committee declined to 
be identified, summed up the status of the American I.G. as a 
subsidiary of the German I.G., and the detailed recital in these 
hearings that Farben had become far stronger in the United 
States than prior to the first World War was sufficient to warn 



192 TREASON'S PEACE 

any member of the Senate or House that the menace to American 
industry and to national security was already a very real one. 

Additional detailed data about Farben went into the record in 
1931 when the late Representative Louis T. McFadden of Penn- 
sylvania, testifying before the Senate Committee on Banking and 
Currency on the nomination of Eugene Meyer to the Federal 
Reserve Board, inserted several lengthy documents describing the 
German chemical trust and its American I.G. subsidiary. Mc- 
Fadden commented that the "queer purpose" of the latter was to 
buy up American companies dealing in chemical and allied prod- 
ucts. Mr. Meyer w*as not accused of participation in Farben's 
subsidiary, but this record made much additional data about 
Farben available to members of the House and Senate had they 
been interested. 

The Senate Special Committee to investigate the munitions in- 
dustry was appointed in 1934, under the chairmanship of Gerald 
P. Nye, Republican isolationist and pacifist from North Dakota. 
The other members of that committee were Walter F. George, 
Georgia; Bennett C. Clark, Missouri; Homer T. Bone, Washing- 
ton; James P. Pope, Idaho; Democrats, and A. H. Vandenberg, 
Michigan; and W. Warren Barbour, New Jersey, Republicans. Six 
of the seven were still members of the Senate in 1941 when Ger- 
many declared war on this country, and when revelations of the 
subversive activities of I.G. Farben's affiliates had attracted so 
much public notice that the Senate began a new series of investi- 
gations to rediscover, amid loud protestations of surprise and in- 
dignation, many of the very same facts about Farben which the 
Nye Committee had recorded back in 1934. In general the public 
has accepted those expressions of surprise as genuine and it is, 
therefore, necessary to go into some detail in discussing how 
voluminous were those revelations of 1934. 

The Nye Committee delved into all kinds of munitions and im- 
plements of war. Farben's tie-ups not only were discussed gen- 
erally as a menace to world peace and to the national security 
of the United States; they were presented in great detail in charts 
and lists of companies and products showing that the Farben agree- 
ments at that time in the United States covered explosives and 
ammunition, dyestuffs, drugs, photographic materials, rayon, mag- 



TREASON'S PEACE 193 

nesium alloys, synthetic oil products, miscellaneous chemicals and 
insecticides; also that products on which possible arrangements 
were contemplated included synthetic nitrogen, synthetic rubber, 
and plastics. 

It might be remarked here that this list of chemical-munitions 
is almost identical to the products I had listed as under the control 
or influence of Farben in the diagramatic chart which I had sent 
to the members of the Senate and House of Representatives in 
1931. Copies of that chart, like so many other documents of mine, 
stirred up the usual tempest in the waste baskets of Washington. 
However, this time, three years later, they dug out the facts them- 
selves and put them in the record and on large elaborate charts 
of their own devising. 

Among the most important contributions which the Nye Com- 
mittee hearings recorded and which both the committee and the 
Senate thereupon promptly ignored, were the proofs which indi- 
cated plainly that Farben and the Hitler government were on 
extremely close terms, and that the rearming of Germany and 
preparations for war were proceeding at an alarming rate. 

In one instance while Lammot duPont was testifying, Senator 
Clark, Missouri Democrat and isolationist, queried him on the 
possibility that secret and patented explosive formulas which 
duPont had turned over to Farben for commercial uses might be 
utilized for military purposes. The Senator asked the witness: 

There would be nothing to prevent them from taking 
those processes and using them in the manufacture of war 
explosives, would there? 

Mr. duPont apparently had no answer to that. 

Repeated warnings that Germany was rearming included ad- 
vice from duPont's Paris representative in 1932 and 1933 that 
the Nazis were armed with American machine guns, and that a 
regular business had been established (not by duPont) of boot- 
legging weapons from this country to Germany. 

From another duPont foreign relations representative came 
the advice in March 1932 that: 

It is a matter of common knowledge in Germany that 
I.G. Farben is financing Hitler There seems to be no 



194 TREASON'S PEACE 

doubt whatsoever that Dr. Schmitz is at least personally a 
large contributor to the Nazi party. 

This was supplemented by a later report from the duPont 
London office which stated: 

Dr. Bosch spends practically all of his time between 

his dwelling in Heidelberg and the government offices in 
Berlin, thus leaving little, if any, time for the affairs of the 
I.G. Farbenindustrie. 

Limitations of space permits inclusion here of only these few 
bits of the very complete evidence assembled by the Nye Com- 
mittee relative to the rearming of Germany, and Farben's part in it. 

The Nye Committee charts and lists also showed many com- 
panies in Belgium, France, Holland^ Italy and other countries 
that were tied to Farben. Thus pictured graphically, Farben was 
revealed as the greatest aggregation of industrial strength and 
military preparedness ever assembled under the direction or in- 
fluence of a single small group of men. Readers of this book may 
wonder why the proven propensities of relatively small makers of 
munitions to bribe and corrupt government officials merely to sell 
them guns and powder did not suggest to the Senators that the 
greatest munition makers of all time, self-designated supermen 
and self-elected for world conquest, would not hesitate to utilize 
bribery and corruption on a huge scale to accomplish their aims 
among the officials of our own government. Perhaps the title of 
this chapter should be, "Facts of Life that a Prewar Senator Ought 
to Have Known." 

The Nye Committee spent many days and recorded many pages 
with testimony about scheming lobbyists who worked against dis- 
armament and bribed officials of foreign governments in the in- 
terest of builders of warships and war weapons; it also, unjustly, 
grouped with such sordid individuals various American scientists 
of the most distinguished character, like Dr. Charles H. Herty 
and Dr. Edgar Fahs Smith, beloved provost of the University 
of Pennsylvania and president of the American Chemical Society, 
whose attainments were recognized the world over and whose 
probity not even a Senate Committee could attack. 



TREASON'S PEACE 195 

However, no attempt was made to record on the pages of these 
hearings the names and activities of the lobbyists who were haunt- 
ing the capital in the interest of I.G. Farben, and who were on 
the payroll of certain of its American affiliates. 

The committee report on chemical munitions came in 1936 after 
long and painful consideration of the evidence. Its recommen- 
dations were tortured and ponderous, they appeared to ignore the 
significance of the Farben tie-ups in the United States, but did 
not hesitate to condemn practices of lobbying and of bribery 
which "tends to rob the governments concerned of the inability 
to work freely for peace." The issue to these Senators was our 
disarmament not Farben's rearmament. 

The committee apparently was obsessed with the thought that 
war could be prevented by government ownership of the chemi- 
cal industry. However, it finally recorded its dilemma: 

The committee recognizes the difficult problems involved 
in the control of the chemical industry in view of the extent 
of its peacetime activities. 

With this profound thought, the members of the Nye Com- 
mittee allowed the visible intrigues of Farben to rest in peace 
until after a new war had begun. 

While the Nye Committee was fumbling with Farben's war 
chemicals, a committee on the other side of the capital was bring- 
ing to light some other Farben activities of an equally dangerous 
but more insidious character propaganda. In March 1934 a special 
committee was appointed in the House of Representatives, to 
investigate foreign propaganda and other subversive activities. 
This was the origin of what later became famous, or perhaps 
only notorious, as the Dies Committee. 

Its Chairman, in 1934, was the Honorable John W. McCormack, 
of Massachusetts. Samuel Dickstein, New York; Carl M. Weide- 
man, Michigan; Charles Kramer, California; Thomas A. Jenkins, 
Ohio; J. Will Taylor, Tennessee, and U. S. Guyer, Kansas, were 
the original members. 

Among the witnesses examined by the McCormack Committee 
were Mr. Ivy L. Lee, the famous public relations counsel, his 
partner Burnham Carter, and one Dudley Pittenger, bookkeeper 



196 TREASON'S PEACE 

for the Lee firm. The testimony of Lee and his associates revealed 
that the firm had been employed by the American I.G. ever 
since the latter was organized in 1929, and that in 1933, when 
Hitler became Chancellor, the German I.G.- also retained Lee to 
give advice as to how to improve relations between Germany 
and the United States. 

Some of Mr. Lee's testimony was confusing. For instance, his 
annual retainer from Farben was $25,000 paid in odd sums by 
the Swiss I.G. and the American I.G., yet he paid his own 
expenses, and these appeared to include the $33,000 a year which 
he paid to his son to stay in Berlin and study the German mind. 

The Lee bookkeeper could throw no light on the discrepancy 
between the $25,000 which the firm received from Farben and the 
$33,000 which it paid out to keep its mind reader in Germany. 
Mr. Pittenger knew of no other work which young Lee was doing 
in Germany except on the Farben account. 

Mr. Ivy Lee's testimony on his relations with the Hitler gov- 
ernment were also confusing. At the start of the examination he 
stated positively that he had no contract with the German Govern- 
ment and that his arrangement was solely with the I.G. However, 
Mr. Lee did get around a bit, and found time to advise the 
Nazi big shots on their propaganda. Testified Mr. Lee: 

I first talked, of course, with my friends in the I.G. They 
all sympathized with my advice and they asked me if I would 
repeat that advice to different officers of the government. So, 
Dr. Ilgner introduced me to various ministers. He went with 
me to see Goebbels, the Minister of Propaganda; Von Papen, 
the Vice Chancellor; Von Neurath, the Foreign Minister; 
Schmidt, the Minister of Economics 

In explaining that his Farben contract was made within two 
or three months after Hitler's advent as head of the government, 
Mr. Lee also stated: 

At that time I did not contact any government officials 
except Hitler himself. They were anxious for me to meet him, 
just as a personal matter, to size him up. 

I had a half hour's talk with Hitler . . asked him some 



TREASON'S PEACE 197 

questions about his policies, told him I would like better to 
understand him if I could, and he made me quite a speech. 

When asked whether it had occurred to him that because of 
the contract with the German I.G. he was acting at least in- 
directly in behalf of the German government, Mr. Lee replied 
in the negative. 

Mr. Lee's partner, Mr. Carter, appeared to diEer on the pur- 
pose of the contract. He testified that sending advice to the German 
firm was, in a sense, advising the German Government; and stated: 

The contract was an advisory one whereby we were 

to report to them concerning American opinion in regard to 
Germany. The general purpose of the contract being to pro- 
mote better understanding between the Germans and Ameri- 
can people. 

The reluctance of Mr. Lee to admit that he had been hired to 
advise the Nazi Government on how to win the friendship of the 
United States is understandable, especially after examining some 
of the recommendations which his firm sent to Farben. The fol- 
lowing memorandum was identified by Mr. Carter as having been 
supplied by the Lee firm a sort of press release which, it was 
recommended, should be broadcast to the world by some respon- 
sible German official: 

Questions have been raised concerning the status of Ger- 
many's so-called "storm troops." These number about 2,500,000 
men between the ages of 18 and 60, physically we rained 
and disciplined, but not armed, not prepared for war and 
organized only for the purpose of preventing for all time the 
return of the Communistic peril. In view of the misunder- 
standing in regard to these civil forces, however, Germany is 
willing to permit an investigation into their character by 
such international arms control organization as is eventually 
established. 

According to Mr. Carter the Lee advice also recommended 
that Joachim von Ribbentrop undertake a definite campaign to 



198 TREASON'S PEACE 

clarify the American mind on the disarmament question, first by a 
series of press conferences, then by radio broadcasts to the Ameri- 
can people, and, finally, by articles in important American pub- 
lications. 

Mr. Lee finally conceded that his intention was that these sug- 
gestions should ultimately be considered by the officials of the 
German Government, and while he was not making the sugges- 
tions for dissemination in this country, they were for the benefit 
of the whole world, including the United States. 

One point was apparently lost sight of by all concerned. The 
question was not asked, nor was information volunteered, as to 
whether or not what Mr, Lee was actually doing, as a hired Farben 
publicity agent, was to outline highf alutin speeches for Nazi offi- 
cials to send back to America, regardless of whether or not they 
were truthful, in order to make the American people less suspicious 
of the real objective of I.G. Farben. 

Mr. Lee appeared unable to agree with members of the com- 
mittee as to just what kind of material came under the classifica- 
tion of propaganda. Asked whether he ever received any propa- 
ganda material from Germany he replied: 

It is a question of what you call propaganda. We have 

received an immense amount of literature books and 

pamphlets and newspaper clippings and documents, world 
without end. 

Congressman Dickstein questioned Mr. Lee about one particu- 
lar lot which he described as a "tremendous >quantity of propa- 
ganda, shipped from Germany on the steamship Bremen, ad- 
dressed to Ivy Lee & Co., New York/' Mr. Lee could not remember 
that particular shipment. 

The committee heard many other witnesses in the course of its 
1934 hearings on un-American activities, some of whom could 
also have been tied into the Farben propaganda machine without 
difficulty if the committee had been so minded. However, this 
testimony of Ivy Lee and his colleagues was so definitely related 
to Farben and Farben's part in the rearming of Germany, that it 
must be considered in all its sinister significance along with simi- 



TREASON'S PEACE 199 

lar evidence uncovered during that same period by the Senate 
Munitions Committee. 

Appeals which I made to Chairman McCormack and other 
members of his committee to unmask fully this "German I.G. 
control of American affairs," and my offers of evidence pertain- 
ing to same, were brushed aside as out of order. It was also in 
1934 that the Hon. James F. Byrnes, who was to go from the 
Senate to the Supreme Court and then become postwar Secre- 
tary of State, ignored my offer of pertinent data relating to the 
unsenatorial activities of his colleague, Dr. Copeland. And, over 
the next several years similar rebuffs were received from the 
Senate Lobby Investigating Committees headed by Hon. Hugo 
L. Black, who was also to move on to a seat on the High Court. 

In April 1935 every member of the Senate and House of Rep- 
resentatives of the United States received a brief, in the form of a 
printed thesis prepared by Francis P. Garvan, protesting against 
the extension of reciprocal trade treaties to Switzerland. This 
brief had been prepared in 1934 and was submitted in behalf of 
"Chemistry in the United States/' Mr. Garvan's authorization to 
present it came from the Chemical Foundation and several of 
the other important organizations which represented the chemi- 
cal industry of this country. It was also sent to Cabinet members, 
officers of executive departments and others. This brief faced 
all concerned with a powerful and unanswerable indictment of 
the policy of governmental inaction in ignoring the dangers to 
our economic security and national defense which was apparent 
in the penetration of our industries by I.G. Farben, and the lat- 
ter's identification with Hitler and the Nazi government. 

The reciprocal trade-treaty statute, authorizing the President to 
enter into foreign trade agreements, had been passed by Congress 
in June 1924, and among the first countries to ask for the advan- 
tages in reduced tariff rates to be derived from such a treaty was 
Switzerland, where the chemical industry was completely domi- 
nated by Farben. In his brief, Mr. Garvan paid his respects to 
those who were attempting to breach the tariff walls that pro- 
tected our chemical industries from a renewal of dumping by 
Farben through its backdoor in Switzerland, and castigated them 
with these words: 



2oo TREASON'S PEACE 

I say it with all solemnity that this industry is as sacred 
to the American people as the grave of the Unknown Soldier, 
and only a traitor or a fool dare touch it. 

Of Farben's ties with Hitler he said: 

the chemical industry is under the direct supervision 

and control of a Minister of Industry who in turn is subject 
to the absolute will and word of Adolph Hitler, the Fuehrer. 
Therefore, in all dealings with the Swiss chemical industry, 
the actual partner and active member of the European dye 
cartel which is dominated and controlled by the German 
I.G., you are dealing with Adolph Hitler. 

Garvan sketched the history of what the German dye trust, 
its Herman Metz, and its spies, had done before and during World 
War I; his own early fight against them, and the efforts of the 
Wilson Administration to aid in the development and protection 
of a coal-tar chemical industry in America. His paper made clear 
the vital importance of an independent and powerful chemical 
industry for the United States, in peace and in war; and he came 
back time after time to what Farben had done and was still doing 
with the aid of its many new industrial patents, its I.G. sub- 
sidiaries, and its literary Ivy Lees. 

In one respect Garvan's brief was prophetic, although he was 
mistaken in the optimism on which his forecast was predicated. 
He warned of the time when our supply of natural rubber might 
be cut off by Japan, but he erred in a belief that the development 
of our chemical industry was a guarantee that we would have a 
substitute sufficient for our needs when that time should come. 

The contemptuous response of Congress to the Garvan brief 
might be observed in the adoption of a reciprocal treaty with 
Switzerland in 1936, and subsequent reductions in the duties on 
coal tar and other chemical products from that country. In 1943, 
after Congress had again "found out" about Farben and Farben's 
war, a clause was actually inserted in the renewal of the Recip- 
rocal Trade Agreement Act which purported to deprive cartels of 
any benefit from such treaties. 

As confirmation of his own warning, Mr. Garvan quoted in his 



TREASON'S PEACE 201 

brief from the then-scorned statesman of another nation who was 
also attempting, in vain, to arouse his fellow countrymen and the 
world to what was coming. The man who, six years later when 
he was called upon almost too late, was to win immortal fame 
as the inspired defender of human dignity and liberty against the 
Nazi brutality which Farben had planned and armed. Garvan's 
quotation was from a debate in the English House of Commons 
in 1934, in which Winston Churchill had said: 

The great new fact that is riveting the attention of every 
country in Europe and the world is that Germany is rearm- 
ing. This fact throws everything else in the background. Her 
factories are working under practically war conditions. Ger- 
many is rearming on land, to some extent on sea; and what 
concerns us most, in the air. 

The most dangerous attack is the incendiary bomb 

Ten days of intensive bombing of London would kill or maim 

thirty or forty thousand people We must face this peril 

where we stand; we cannot move away from it. I hope the 
Government will not neglect the scientific aspect of protec- 
tion of the population, but pending some new discovery, 
the only practical measure for certain defense is being able to 
inflict as much damage on the enemy as he can inflict. That 
procedure, might, in practice, give complete immunity. 

This historic premonition and warning from England's future 
Prime Minister went unheeded, and in America as in the British 
Empire, professonal politicians took refuge beneath a shabby 
umbrella covered with the flimsy fabric of pacifism, and refused 
to act on the evidence under their noses of what Germany, and 
Farben, were again preparing to do. 



CHAPTER XI 



Two Drug Laws- -And Two Wars 



ON DECEMBER 

3, 1942, the Federal Circuit Court of Appeals in New York handed 
down a decision which if it had been sustained would have sub- 
stantially ended all possibility of successful prosecution of cor- 
poration officials and employes for violation of the new Food, 
Drug and Cosmetic Act, sometimes known as the Copeland law. 

With that decision the court put its judicial interpretation on 
the result of long years of effort through which Senator Royal S. 
Copeland, with the assistance of the Sterling-Farben drug lobby, 
and various public officials, extracted the teeth from the Harvey 
Wiley Food and Drugs Act, and had enacted in its place a legalis- 
tic monstrosity so full of jokers and ambiguities as to afford no 
protection whatsoever against influential violators. 

The case in which the decision was handed down involved 
a shipment of adulterated and misbranded digitalis, and the ap- 
peal from conviction of the president of the corporation which 
had shipped it. The learned appeal judges reversed the convic- 
tion, and stated that it would be "extremely harsh" to charge a 
corporation official with a criminal offenseregardless of his 
actions, or inaction unless he was an officer of a very small cor- 
202 



TREASON'S PEACE 203 

poration. The new law was as cock-eyed as that! Or so the appeal 
court held. ( Later the Supreme Court reversed the findings of the 
Appeal Court, in a close decision with four of the high court Justices 
upholding the appellate decision. ) 

Under the old Wiley law, officers of corporations could be, 
and were at times, prosecuted, convicted, and sent to jail. Un- 
happily, the old law was seldom invoked against important of- 
fenders, but it did authorize and, in fact, require such prosecutions. 

It can easily be imagined how disastrous it would have been to 
the Farben plans had Herman Metz, or Doctor Weiss, or Earl 
McClintock, or Dr. Hiemenz, or any of the other Sterling- Win- 
throp-Bayer executives been held criminally responsible for some 
of the vicious violations of the Food and Drug Law practiced by 
their companies some of which will be discussed in just a moment* 
And it has long been my contention that the frantic demands of 
Copeland and his clients for a new law were to prevent that very 
possibility. 

Be that as it may, in June 1933, it was to Senator Copeland that 
the task of putting through the new law was entrusted. 

Professor Rexford Guy Tugwell was alleged to be the author 
of the first bill submitted to the Senate by Dr. Copeland. This 
bill was bad enough it omitted all traces of mandatory enforce- 
ment. In the second bill, drafted by Ole Salthe, the Copeland 
business manager, no misunderstanding was possible a clause was 
inserted which actually instructed the enforcement official never 
to take to court any "minor violation" when he "believed" that 
the public interest would be served by a "suitable written notice 
or warning." 

As the phrase minor violation is not defined anywhere in the law, 
it is obviously meaningless in a legal sense. In the administration 
of the law it means whatever the enforcement official choses to 
believe it means. And, in August 1935, before a subcommittee of 
Congress I challenged Representative Virgil Chapman, chairman, 
to define the word "minor" as used in the Copeland bill, saying: 

If anyone can define the word "minor" as used in this bill, 
I will withdraw my objection I have been asking every- 
one I have been able to talk to here to define the word minor. 



204 TREASON'S PEACE 

"Don't make me laugh," they answer. The whole purpose of 
this legislation is to get rid of the mandate in Harvey Wiley's 
law for criminal prosecution, and to replace it with a law 
which puts in the hands of an enforcement official the power 
to do absolutely as he pleases on each individual offense. 

Representative Chapman refrained from accepting my chal- 
lenge, and instead contented himself with constant heckling, and 
demands that I discontinue my testimony. 

The final version of the many Copeland bills was passed by 
the House and Senate on June 13, 1938, and became law by the 
President's signature two weeks later, a few days after the sudden 
and unexpected death of its sponsor, Senator Copeland. 

In the long and bitter struggle over this legislation, one of the 
numerous protests was a brief prepared by Dr. Norman W. Burritt, 
as representative of the Medical Society of New Jersey. Dr. Bur- 
ritt's brief contained the following: 

Let it be thoroughly understood that the Wiley Act is a 
mandatory criminal statute on which have been based a large 
mass of district, appellate, and supreme court opinion. This 
mass of judicial interpretations would be entirely obliterated. 

if the Wiley Act is repealed This is so important in itself 

as to be the basis for summary rejection (of the Copeland 

bin). 

Some of the story of the Food and Drugs law has been told 
in a book* published by my wife and myself in 1935. Dr. Harry 
Elmer Barnes concluded a review of that book with the comment 
that his column was 

not the place to pass any verdict upon the charges 

preferred by Mr. Ambruster, but it is evident that they can- 
not be overlooked. Either he should be prosecuted for crim- 
inal libel, or those whom he denounces should be relentlessly 
exposed and properly punished. 

Being in complete agreement with Dr. Barnes, I wrote to the 
three individuals who were principally denounced in my book, 

* "Why Not Enforce the Laws We Already Have?" 



TREASON'S PEACE 205 

and requested them to prosecute me for criminal libel should any 
of them feel that my accusations were false and unjustified. The 
three were Dr. Morris Fishbein, editor of the Journal of the Ameri- 
can Medical Association; Walter G. Campbell, Chief of the Food 
and Drug Administration, and Dr. Royal S. Copeland, United 
States Senator. 

It would take another volume as large, or larger, than this one 
to tell the full story of the legislative battle to repeal the Wiley 
law. However, it is only necessary here to outline briefly those 
parts of the fight which bear directly upon the immunity accorded 
Farben's drug and patent medicine affiliates. 

When the campaign for a new law was getting under way, 
there was a strange unanimity in the expressed opinions of the 
principals involved men whose interests should have been as far 
apart as the poles. Professor Tugwell, the Assistant Secretary of 
Agriculture, Frank Blair, Sterling's president of the Proprietary 
Association, and Dr. Morris Fishbein, all agreed that the poor 
old Wiley law was no good. Said Tugwell: "Dr. Wiley's law is 
obsolete." Said Mr. Blair: "It has been an effective statute ..... 
but it does not go far enough." Said Dr. Fishbein: "The Food and 
Drugs Act of 1906 failed largely of its purpose/' Somehow they 
all forgot to mention that the real trouble and the only trouble 
with the Wiley law was lax enforcement. 

One of the problems which confronted those directing the fight 
to get rid of the Wiley law, was the remarkable record which that 
law had made whenever it was invoked in the courts. The record 
showed that out of over 31,000 cases taken to court in the thirty- 
three years of its existence, less than 175 were lost by the Govern- 
ment, or a bare half of one percent. According to several informed 
public officials with whom I have discussed the subject, no other 
federal statute has ever made anything like such a record. For 
example, the F.B.I., with its fine record, is said to have lost a 
higher percentage than this of its court cases. 

To justify the repeal of the Wiley law, a list of thirty-four allega- 
tions was prepared, and, believe it or not, each and every one of 
those allegations was either directly false or based upon a mistruth. 
This list made its appearance early in the fight and kept on reap- 
pearing in committee reports, and on the floor of the House and 



2o6 TREASON'S PEACE 

Senate until the Copeland bill became law. Among those who 
issued the list as an official paper, or, at least, as officially sanc- 
tioned, was one Paul Appleby, at that time assistant to Secretary 
of Agriculture Henry A. Wallace. Mr. Appleby posed as an author- 
ity on the subject of both the Wiley law and the pending legisla- 
tion. He was neither. 

In 1936 he sent this list, as proof of the superiority of the Cope- 
land bill, to a prominent educator who had suggested that the 
Department might benefit from discussing the Food and Drug 
law situation with me. Mr. Appleby's response to that suggestion 
was to say that: 

I will not join in a recommendation that more of this De- 
partment's time be wasted on Ambruster; I shall oppose it 
emphatically in defense of good administration and proper 
use of time. 

One of the thirty-four alleged improvements of Copeland's bill 
over the Wiley law was that the new bill forbade traffic in con- 
fectionery containing metallic trinkets and other inedible sub- 
stances and the old bill did not. Another, that the bill pending 
provided for food standards. The fact was that court cases were 
then on record in which the government was successful in securing 
the condemnation of candy-coated trinkets as adulterated under 
the Wiley law; while food standards covering everything edible 
from soup to nuts had been issued by the Food and Drug Admin- 
istration for use in enforcing the Wiley law from the time it was 
passed. 

Senator Copeland made frequent use of this list in the Senate 
and in public. He was especially fond of the one about the candy 
trinkets because it gave him an opportunity to emote on the sa- 
credness of childhood, and the grave danger of trinket-swallowing. 
In an exchange with Senator A. Harry Moore, of New Jersey, 
when these two ornaments of our highest legislative body staged 
their mock debate on amendments proposed by the Medical So- 
ciety of New Jersey, Senator Copeland ended his speech with: 

If we were to accept the substitute presented by the Sen- 
ator from New Jersey, there would be no such prohibition 



TREASON'S PEACE 207 

as is contemplated by the pending bill. I know that Senator's 
kind heart and that he would not wish this to be the case. 

Both Senators seem to have been terribly anxious that day to 
have it appear that serious consideration was being given to the 
Medical Society's amendments to the Wiley act which Senator 
Moore had introduced. For three-quarters of an hour they staged 
what appears on the record to have been a valiant fight. Yet, in the 
entire exchange, not one of the proposals made, or the facts sub- 
mitted, by the New Jersey doctors, was accurately stated or truth- 
fully debated. 

In addition to Dr. Burritt's brief, Senator Moore also inserted 
in the record a statement which had been prepared for him, ex- 
plaining the amendments. Within an hour and of course long 
before the record was printed, the amendments proposed by the 
Medical Society were rejected by a snap vote on which the yeas 
and nays were not taken. 

It so happens that under the rules of the Senate the bill pro- 
posed by the Medical Society should have gone directly to the 
committee in charge of such legislation, where it could have had 
a hearing and have been studied by the members of the commit- 
tee before it was presented on the floor. Senator Moore, however, 
chose a questionable alternative when he introduced it as an 
amendment to the Copeland bill, then threw it into the debate 
at the last moment. 

It was by such tactics that the stage was set for the court de- 
cision some years later which so discouraged criminal prosecu- 
tions of the executives of corporations, like Standard Oil and Ster- 
ling, which firms, it so happens, were clients of Copeland Service, 
Inc. 

Representative Frank W. Towey, of New Jersey, made a real 
fight on the floor of the House of Representatives against the am- 
biguities and impotence of the Copeland bill as pointed out by 
the Medical Society of his State. Congressman Towey was par- 
tially successful in limiting the most vicious provision of the bill, 
the "minor violation" joker, with a restriction which forbade the 
enforcement official to give more than one warning to any one 
offender before instituting court proceedings. The House version 



ao8 TREASON'S PEACE 

of the Copeland bill was passed with Mr. Towey's amendment 
in it; the bill then went to a Conference Committee headed by 
Doctor Copeland where, by a very simple legislative operation 
the limitation on the number of warnings was quietly snipped off 
and deposited in the waste basket. This action thus served notice 
on all concerned ( including any judge who may become intrigued 
about "minor" violations) that its administrator is instructed to 
continue in perpetuity to issue warnings "please not to do it again" 
to the same offender for the same offense no matter how dan- 
gerous to the lives and health of the public that offense might be. 

Possibly the crowning use of the false allegations about the 
improved protection afforded the public by the Copeland law 
was made by Senator Alben W. Barkley, majority leader of the 
Senate. On July 5, 1938, Senator Barkley indicated that Cope- 
land's law was better than Wiley's because food standards were 
not amenable to control under the old law. At this distance it 
is difficult to judge whether Senator Barkley did not know, or 
did not care, what he was talking about. 

No bets were overlooked, and no methods were too low for 
those who emasculated the food and drug law for the benefit 
of Farben's American drug front. In the final stages of the fight, 
the New Jersey Medical Society asked for a public hearing to 
present and discuss its objections to the Copeland bill. At the 
same time, the drug lobby, headed by Sterling's Frank Blair, re- 
quested a private hearing. The drug lobby got its private hearing 
from Clarence Lea, chairman of the House of Representatives 
Committee. The Medical Society was refused any hearing what- 
soever. 

When the Copeland bill finally became law, the job of estab- 
lishing suitable regulations for its enforcement arose. And it began 
to dawn on those most concerned that as no one had the slightest 
idea of what many of its provisions meant, and as enforcement 
officials were now possessed of heretofore unheard of discretion- 
ary powers, there was danger that the new law would turn out 
to be a boomerang. So Commissioner Campbell was persuaded 
to appoint, as his "technical consultant," the man who had drafted 
the bill for Senator Copeland, Mr. Ole Salthe; he, at least, ought 



TREASON'S PEACE 209 

to know what it meant. Mr. Salthe, by now operating his own com- 
mercial consulting business as a successor to the late Senator Cope- 
land, took the job and then proceeded to seek clients by advertis- 
ing his services as an official of the Food and Drug Administration. 
And please don't say he couldn't do that he did! 

Under the language of the Copeland law all new drugs would 
surely be safe because they would have to be inspected and ap- 
proved by the Food and Drug Administration before they were 
put on the market. 

So early in December 1940, the Farben-Sterling subsidiary, 
Winthrop, shipped some 400,000 tablets of a newly developed drug 
labeled Sulfathiazole, which at that time was the most recent 
modification of the original sulfa germ destroyer, Sulfanilamide. 

Sulfathiazole Winthrop had been approved by the food and 
drug official in charge of new drugs, one Dr. J. J. Durrett, who 
some years previously had called on one of the foremost physi- 
cians of his generation and threatened him with dire consequences 
should he testify before a Senate committee about the lax en- 
forcement of the Wiley law. 

However, as it was later revealed, Dr. Durrett's approval did 
not mention the "inadequacy of controls" which existed in the 
Winthrop factory. The 400,000 tablets labeled Sulfathiazole were 
a mixture of the germ-destroying sulfa drug and the remedy called 
Luminal, which puts people to sleep. Some of these tablets con- 
tained more than five grains of Luminal, the usual safe dosage 
of which is one grain. So, during the next three months, numerous 
patients to whom the Winthrop tablets were administered did 
go to sleep and never woke up! 

Whether any of the Winthrop staff actually knew that the tab- 
lets were adulterated when they were shipped or whether some- 
one mixed the ingredients deliberately as sabotage has never been 
revealed. The fact is admitted, however, that the Winthrop man- 
agement knew about the adulteration very shortly after the ship- 
ments went out when complaints came in from physicians in 
Louisville, Ky., and analysis revealed the admixture of Luminal. 

Yet the Sterling- Winthrop executives did not issue any public 
warning to the pharmacists and physicians who were dispensing 
and administering these deadly tablets. Instead they instructed 



210 TREASON S PEACE 

their personnel to repossess the tablets, giving as the utterly false 
reason that, "they do not disintegrate properly." 

Then began a publicity campaign to push the sale and use of 
Winthrop Sulfathiazole a campaign which had the cooperation 
of Dr. Morris Fishbein, in the Journal of the American Medical 
Association a procedure completely unbelievable, if the record 
did not prove it. On January 25, 1941, the Journal announced that 
"Sulfathiazole-Winthrop, U. S. Patent applied for" had been ac- 
cepted by its Council on Pharmacy and Chemistry for inclusion 
in its official volume of New and Nonofficial Remedies. (Possibly 
it should be stated here that a vast majority of members of the 
medical profession regard this "acceptance" of a new remedy as 
a solemn guarantee to them by the officers of their national organ- 
ization that an investigation has been made and that the product 
could be relied upon for quality and efficacy. ) 

For good measure, and in that same issue of the Journal, there 
appeared a scientific treatise on Sulfathiazole, with a footnote 
indicating that its authors were research workers for Winthrop, 
and were advising the drug authorities at Washington on the 
subject. And finally, as though to make certain that no reader 
would miss the good news, the Journal carried a full-page adver- 
tisement: "Sulfathiazole Winthrop Now Accepted." Included was 
the shield of the council, and the added legend, "Winthrop Chem- 
ical Co., Pharmaceuticals of Merit for the Physician." On Febru- 
ary 1, and March 15, this advertisement of Sulfathiazole was re- 
peated. 

In any event, it was not until April 3, 1941, that the Winthrop 
Chemical Co. issued its first warning to the public and the med- 
ical profession that some of its Sulfathiazole tablets were not safe 
to use because they were "accidentally contaminated." The return 
of any tablets which were still outstanding was requested and, to 
indicate a suitable appreciation of its public responsibility, the 
company also expressed its profound regret at the occurrence. 

The Winthrop warning was an anticlimax. The real warning 
had come a week earlier, on March 28th, when state health and 
pharmacy departments, and local police authorities all over the 
United States, began sending out notices to hospitals and drug- 
gists not to dispense any more Sulfathiazole. 



TREASON S PEACE 211 

Meanwhile, in March, and shortly before the Sulfathiazole story 
broke, Dr. Durrett transferred his services to the Federal Trade 
Commission to become its authority on medical advertising. Ac- 
cording to Drug Trade News, the industry highly approved the 
way he had handled new-drug applications under the Oopeland 
law. 

Dr. Durrett's work as new-drug supervisor was taken over by 
Dr. Theodore G. Klumpp, head of the division which inspected, 
sampled, and tested all drugs. Dr. Klumpp's inspectors do not 
appear to have done much inspection, sampling, and testing on 
the Winthrop shipments. Seventeen deaths were reported by physi- 
cians as apparently due to administration of these tablets during 
the three months of the concealment, no computation was possible 
of those who were injured but stayed alive. 

In April, when the various official state and federal agencies 
completed their search of drug stores and hospitals, a hundred 
thousand tablets, or 25 percent of the December shipments were 
still missing, and unaccounted for except by the deaths. 

Food and Drug Commissioner Campbell issued a statement. 
He declared that the actions of the Winthrop Chemical Company, 
after it discovered that the tablets were in circulation, "had not 
been satisfactory." "The company," said Mr. Campbell, "had 
known of the situation in December, but the government was not 
informed until March 20th. The failure of the responsible officials 
of the Winthrop Chemical Company to notify the Food and Drug 
Administration immediately of this incident, has as yet not been 
satisfactorily explained." Apparently an explanation that satisfied 
Mr. Campbell was made later, because he never took any action 
to hold the Sterling- Winthrop executives responsible in court, 
either for having filed a false application for a new drug, or for 
having permitted adulterated tablets to be manufactured and 
shipped; or for conspiring among themselves and with others to 
conceal the adulteration while they were advertising to the med- 
ical profession the alleged guarantee of Dr. Fishbein's Council 
on Pharmacy and Chemistry. 

However, as we have seen, the Copeland law does not require 
the administrator to ask for an explanation; it merely authorizes 
him to do what he thinks desirable. And, if he should decide that 



212 TREASON'S PEACE 

a deliberate silence which resulted in seventeen deaths was a 
minor violation, he might also decide, lawfully, that a letter of 
warning was sufficient. 

Again, we have to consider that Circuit Court decision of De- 
cember 1942 which held that under the Copeland law executives 
and employes of a corporation like Sterling could not be prose- 
cuted, no matter what they did. Perhaps Mr. Campbell saw that 
decision coming, or perhaps Mr. Ole Salthe, his technical con- 
sultant, advised him that it would be useless to try those responsi- 
ble. Whatever the reason, the executives were never taken to 
court. The Winthrop Company, however, was prosecuted for some 
of the shipments, and, after pleading guilty, was fined $15,800; 
which sum about equaled the selling price of the 400,000 tablets. 

Strangely enough, at the very time when the gentle action 
against Winthrop was filed in December 1941, a little-known con- 
sultant for a new skin remedy was indicted in Washington on 
a charge of falsifying the application he had filed with the Food 
and Drug Administration. When this individual failed to make 
bail, lie was arrested and lodged in jail. Evidently Mr. Campbell 
did not believe that that particular violation was a minor one 
the remedy was said to have damaged the livers of animals used 
in experiments with it. 

Commissioner Campbell also rejected the thought that such 
crimes as leaving too many cherry pits in a can of cherries should 
be classed as minor violations of the Copeland law. In a bulletin 
issued just at the time of the Sulfathiazole expose, there were 
notices of successful court actions against canned cherries be- 
cause they had more than one pit per 20 oz. tin; canned peas be- 
cause they were not immature, canned tomatoes because the 
pieces were too small, and canned apricots because they were 
not uniform in size. 

Perhaps this is an appropriate time to point out that the Cope- 
land law is so powerful an instrument for the public health that 
certain of its sections also forbid, and permit severe punishment 
for, adulterating horseshoe nails, and misbranding ladies' bras- 
siers; and if Mr. Campbell or his successor Dr. Paul Dunbar, really 
got het up about it he could prosecute a dealer in pigs nose-rings 
because the premises where the rings were stored were unsanitary 



TREASON'S PEACE 213 

(Doubters please see sections 201 (h); 301 (a) (b); and 501 (a) 
(1) and (2), Federal Food, Drug and Cosmetic Act of 1938). 

On April 22, 1941, Winthrop's license to ship Sulfathiazole was 
revoked. Three months later it was restored, and the company 
promptly reduced its prices on Sulfathiazole Winthrop, with the 
announcement that the tablets were again for sale as "Pharma- 
ceuticals of Merit for the Physician." 

Dr. Klumpp, by this time, had moved onward and upward. He 
had accepted a position awarded him by Dr. Fishbein and become 
Director of the A. M. A. division on food and drugs and secretary 
of its Council on Pharmacy and Chemistry (the same council 
that had "accepted" Winthrop's Sulfathiazole and approved its 
advertising). And Dr. Klumpp kept moving. Not long thereafter, 
Edward S. Rogers, chairman of the Board of Sterling Products, 
announced that Dr. Klumpp had been elected president of Win- 
throp. 

One aftermath of the Sulfathiazole affair belongs in this story. 
The first expose came just when the Antitrust Division of the Jus- 
tice Department was starting its grand jury investigation of Ster- 
ling and Winthrop. When I mentioned the adulteration and its 
concealment to one of the staff he advised me to "keep my shirt 
on," as drastic action was on the way. This was before he and 
his colleagues had felt the full weight of the Corcoran big toe. 

Time went on and there was no indication that the Justice De- 
partment would act, so I placed the matter squarely up to Federal 
Security Administrator Paul V. McNutt, to whose authority the 
Food and Drug Administration had been transferred in 1940. He 
advised me that an information had been filed against Winthrop 
and that he considered further discussion unnecessary, as I had 
already been in correspondence with the Justice Department 
about it. McNutt indicated full approval of Commissioner Camp- 
bell, and was just not interested in the Farben-Sterling conspiracy 
angle. 

Later, in July 1942, a forthright member of the Justice Depart- 
ment staff indicated his agreement with my conclusions about the 
guilt of those involved in the concealment of the adulterated tab- 
lets and in my presence gave instructions that the case should 
be reopened on the basis of the statute which covers conspiracy 



214 TREASON'S PEACE 

against the United States. At his request, I submitted a brief out- 
lining all the circumstances involved. The brief cited several con- 
spiracy actions in which jail sentences had resulted for such crimes 
as conspiring to ship oleomargarine as butter and mixing olive oil 
with a cheaper product. 

A few weeks later that particular member of the justice staff 
was no longer holding down that particular job. I was told that 
he had resigned. That Winthrop case was not reopened. 

In February 1944, long after an alleged "housecleaning," Win- 
throp was again in serious trouble with the Food and Drug Ad- 
ministration when the latter seized and destroyed several thou- 
sand cartons of Winthrop ampules labeled as containing "Atabrine 
Dihydrochloride" and "Sterile Distilled Water/' but which were 
found to be adulterated. These ampules were to be used by physi- 
cians for hypodermic injections. 

Three months later Winthrop was again prosecuted criminally, 
charged with shipping adulterated ampules as above noted, and 
others containing "Neoarsphenamine" and "Dextrose" (the latter 
being used respectively for treatment of syphilis and as a diluent 
for "Pontocain," for spinal anesthesia). 

When this prosecution was filed in the New York Federal Court 
the United States Attorney in charge announced that batches of 
the ampules had been picked up in navy hospitals and army 
bases; that more than 90,000 ampules and other packages had 
been recalled; that the damage apparently was due to lax control 
and failure at the Winthrop, Rensselaer, N. Y. plant to keep the 
apparatus clean, and that the situation had been uncovered when 
seven persons one of whom died showed unusual symptoms 
after receiving spinal anesthetics containing a Winthrop solution. 
Other hospital patients were adversely affected, said the prose- 
cutor, and he concluded that the possible fines in the case could 
total $120,000, if the company were found guilty. 

Winthrop's Dr. Klumpp immediately denied the charges in 
vehement public statements, then a few months later the com- 
pany changed its plea to "Guilty" and took a fine nicely marked 
down of $18,000. Shipments of these adulterated ampules were 
found in numerous states as far west as California in 1943 and 



TREASON'S PEACE 215 

1944. And during the period of these seizures, but before the 
criminal prosecution resulted in publication of the affair in the 
lay press, Dr. Fishbein's Journal of the A. M. A. was repeatedly 
publishing full page advertisements featuring Winthrop products 
including "Winthrop" Atabrine Dihydrochloride, winner of the 
Army and Navy "E" flags; with which 

competent medical officers responsible for the health of our 
armed forces have seen to it that every soldier, sailor and 
marine will have the fullest protection against malaria that 
modern methods can afford. 

In appraising these two Winthrop cases, as the design may ap- 
pear to fit into the pattern of Farben, the reader is now asked 
to look back. This time the story returns to an earlier war, when 
the Kaiser's armies were fighting in Europe, and the German espi- 
onage and propaganda machine in the United States was under 
the direction of Bayer's Dr. Hugo Schweitzer. It was then, in 
1915, that the United States was also faced with an immediate 
internal peril because imports of the supply of another important 
new drug, Salvarsan, had been cut off along with other medicinals 
and dyestuffs. 

Salvarsan, the Hoechst trademark for the product arsphena- 
mine, or arsenobenzol as it was then known, had been one of 
a number of important medical products imported by Herman 
Metz. As the only known remedy for syphilis, it was indispen- 
sable in this country for the public health and for the efficiency 
of our armed forces. 

In June 1917, after this country had entered the war, Dr. George 
Walker of the Council on National Defense appeared before the 
Senate Patents Committee to urge that Salvarsan patents be abro- 
gated. Metz, after threatening patent suits against new makers, 
was finally compelled to renounce his German friends' determina- 
tion that his country should "starve to death" for vital drugs to 
use his own expression and began to produce Salvarsan himself, 
through the Metz Laboratories. He also was compelled to permit 
several other concerns to begin commercial manufacture. How- 
ever, the shortage was not relieved until after the Federal Trade 



216 TREASON'S PEACE 

Commission and the Alien Property Custodian had seized all of 
the Hoechst patents, and granted licenses to several concerns to 
manufacture arsphenamine. 

While the design may vary with the times, the Farben pattern 
never changes and so we find that the adulterated Sulfathiazole 
of World War II had its counterpart in World War I when adult- 
erated arsphenamine made its appearance in the United States, 
and Metz cabled Hoechst: "Spurious and infringing products 
simply flooding market." At that time, too, there was no direct 
proof that the adulteration was deliberate. 

Another important U. S. patent owned by Hoechst covered the 
local anesthetic, procaine, protected under the Hoechst trademark 
as Novocain. Other patents covered antipyrine, the first coal-tar 
headache cure; and phenacetin, the shortage of which for treat- 
ment of influenza had also caused much unnecessary suffering. 

Two of the other Big Six German dye companies held numerous 
U. S. Patents on important medicinals. One of these was Kalle 
which controlled the remedies known as Bismon, Formicin, and 
Menthol lodol. Bayer controlled Aspirin (until 1917 when the 
U. S. patent on acetylsalicylic acid expired) Luminal and Veronal. 
The last two were also made in the American Bayer plant. 

When World War I broke out, all of the above and many others, 
were among the "accepted" new and nonofficial remedies of the 
A. M. A. Council on Pharmacy and Chemistry. At that time the 
real boss of the A. M. A., and chairman of its Council was "Doctor" 
George H. Simmons, the charlatan whose name remained on the 
masthead of the Journal of the American Medical Association 
until he died in 1937. 

When Simmons withdrew from the limelight in 1924, and Dr. 
Fishbein took his place, the German I.G. Dyes owned the Big 
Six and its drug fronts here had been Americanized under the 
names of Sterling, Winthrop and the Bayer Co. of New York. The 
names, but not the pattern, had changed. 

There is no implication here that some of the German dye-trust 
medicinals thus "accepted" by the A. M. A. Council are not useful 
in the relief of human sufferings. The most objectionable feature 
of these acceptances is that they made it possible to charge ex- 
cessive prices, and that the resulting tremendous profits were 



PEACE 217 

used to help finance subversive activities in the United States 
before and during two World Wars. 

Also, the A. M. A. guarantees served as a cover for violations 
of the food and drug laws, and the false advertising laws long 
before the Sulfathiazole affair. Many of these violations by Farben 
affiliates remain concealed in official files where they were placed 
by Mr. Campbell, in ''permanent abeyance," and without court 
action. However, some did reach the light of day. 

For example, in 1928, shortly after the Cook Laboratories came 
into the Farben-Sterling-Metz family, a prosecution was started 
against that company for having shipped a long list of so-called 
ethical and official remedies which were adulterated and mis- 
branded under the Wiley law. For years this case was shelved, 
and ignored by all concerned. Then, in 1932, something slipped. 
Cook Laboratories pleaded guilty, and was fined $750. The pen- 
alties, under the Wiley law, could have been more than $5,000 
and a good many years in jail for some of the executives. Mean- 
while, Cook Laboratories' remedies remained in the New and 
Nonofficial list as "accepted." 

In 1936, in California, a criminal prosecution was brought under 
the Wiley law for shipments of adulterated Amidopyrine tablets, 
Novocain ampules, and another medicinal by a local company 
which pleaded guilty and was fined. The Novocain ampules were 
identified as the Metz Laboratories' brand, and the charge was 
that the ampules contained a greater quantity of Novocain than 
the label stated (i.e., an overdose). Why the prosecution was 
brought against the shipper instead of Metz or Winthrop was not 
explained. 

It seems preposterous that the U. S. Patent Laws could have 
been utilized to injure the public health and the health of our 
armed forces before and during World War I. Even more out- 
rageout it is that precisely the same thing has been allowed to hap- 
pen in this war when the Farben-Sterling ownership of Winthrop 
used its patents on Atabrine to restrict the production of that 
remedy for malaria after Japan had cut off our supply of quinine 
from the Dutch East Indies. 

The history of the drug called Atabrine goes back to the ex- 
periments of the young English chemist Perkin almost a century 



2i8 TREASON'S PEACE 

ago, as mentioned in Chapter i, when the attempt to make synthetic 
quinine from coal tar resulted in the discovery of coal-tar dyes. 

It was in 1927 that Farben chemists first thought they had per- 
fected quinine synthesis from a coal tar base. However, this 
product, called Plasmochin, was only partially efficient for malaria 
control; it did kill the germs but it did not cure the disease. So 
the research continued and Quinacrine Hydrochloride, now sold as 
Atabrine, was discovered some five years later. In the early thir- 
ties Atabrine was introduced in the United States as a Winthrop 
product. But it was made by Farben all Winthrop did was to put 
it in ampules or to compress it into tablets and distribute the 
new remedy under its own label as made in America. 

It should be unnecessary here to go into the history of malaria 
from the time when its epidemics played a part in the destruction 
of Athens and Rome, to its present ravages upon the health and 
lives of a large percentage of the world's population. 

According to the National Institute of Health it is estimated that 
under normal, or pre-war conditions, not less than 500,000,000 
persons suffer yearly from malaria. Others estimate that one-third 
of the population of the globe is afflicted with this disease. 

As illustrative of its importance to the national defense, the 
annual report of the Surgeon General of the United States Army 
in 1941 indicates that hospitalization of enlisted men for malaria 
in Panama and the Philippines has been well over 100 for each 
1000 stationed there. Under these conditions the grave danger 
to the health and efficiency of thousands of men in the Army and 
Navy, many of whom were never previously exposed to malaria, 
is obvious. 

It may be added that this story is not the place to present or 
argue the merits of Atabrine as compared with quinine. It is 
necessary, however, in appraising its place in the Farben pattern, 
to record the fact that a wide discrepancy in medical opinion has 
been revealed regarding the merits of Atabrine as a malaria rem- 
edy. Possibly the highest point in the controversy is to be found 
in a voluminous treatise on the subject by Dr. Aubrey H. Hamil- 
ton, Lieutenant Commander in the United States Navy, who re- 
turned to Washington when the war started, after twenty years 
of clinical observations of the incidence and treatment of malaria 



TREASON'S PEACE 219 

in the tropics. The treatise was prepared and published under 
the auspices of the Board of Economic Warfare and the Depart- 
ment of Commerce. In it Dr. Hamilton left no doubt as to his own 
findings, and those of numerous other medical men, that Atabrine, 
as it was then made, presented no advantages over quinine 
in the treatment of malaria, and had certain toxic properties which 
had to be eliminated through change in its formula before its final 
acceptance as anything but an emergency substitute for the older 
remedy. 

Back in 1935, when Atabrine was first being tried out in the 
United States on a large scale, medical authorities reported that 
mental disturbances followed its use. The public relations experts 
of Sterling neither conceded this fault possible nor mentioned it, 
They contented themselves with statements issued either directly 
or through sources not readily identified as friendly which en- 
larged upon the tremendous expansion made in Winthrop's pro- 
duction of Atabrine for national defense purposes, and the reduc- 
tion in selling price to a figure less than one-tenth of that which 
was charged before the war ( and before the subversive tie-up of 
Winthrop with Farben was officially exposed). 

One notable example of this kind of publicity was a full-page 
Winthrop advertisement in the daily press and various lay journals 
in December 1942 and January 1943 proclaiming the receipt of 
the Army and Navy "E." One Joseph Jacobs, head of an advertis- 
ing organization, then sent out full size reprints of this advertise- 
ment to professional men. Mr. Jacobs also made similar distribu- 
tion of copies of a letter addressed to him by Edward S. Rogers, 
Sterling's Chairman of the Board, in which the latter dwelt upon 
the foresight of Winthrop in starting to make Atabrine in October 
1940 out of domestic raw materials (when they no longer were 
obtainable from Farben) and in increasing the production (when 
the government so instructed). 

The Rogers letter, nine long pages, proved the case for Winthrop 
by references to praises which had been heaped upon its perfor- 
mances by various individuals, including Dr. Morris Fishbein, 
who was to preside at the Army-Navy "E" ceremony and by Dr. 
Paul de Kruif, the author, who had just published an article in 



22o TREASON'S PEACE 

Readers' Digest which lauded Winthrop's Atabrine as a major 
victory for the United Nations. 

By something of a coincidence the Rogers reference to the 
Readers' Digest article was being circulated among anti-Farben 
professional men at the very time that I was in correspondence 
with de Kruif about that same article. I had written him on 
December 24, 1942, to ask whether his source of data was the 
Sterling- Winthrop press agent, one Mermey of the firm of Bald- 
win, Beech and Mermey (of whom more later). I also asked 
Dr. de Kruif whether he was familiar with the official record of 
Winthrop's lack of manufacturing integrity as illustrated by the 
Sulfathiazole horror; or of the relations of Dr. Fishbein with Win- 
throp; or of the pro-Nazi interests of the Sterling- Winthrop per- 
sonnel. 

To my surprise and gratification, de Kruif replied on December 
31, 1942 that he had sent my serious charges to his friend Dr. T. 
G. Klumpp, President of Winthrop: 

I shall forward his reply to you when it comes. I am ask- 
ing him to answer your charges one by one and in detail. 

For the moment I thought I had drawn a bit of blood. How- 
ever, something, or somebody, caused Dr. de Kruif to change his 
mind. In a later letter he intimated that I was being influenced 
by the Dutch quinine syndicate (which was a rather absurd as- 
sumption), and he resolutely declined to advise me what reply 
Dr. Klumpp had made to him relative to my accusations about 
the integrity of Winthrop, its manufacturing record, its officers 
and its employees. 

Later it was recalled to me that Dr. de Kruif had been an early 
propagandist for Winthrop and Farben's Atabrine, back in 1938, 
when he published an article in the Saturday Evening Post which 
boasted of the triumph of the German dye trust in producing 
a new medicine so much better than quinine that it was no longer 
a question, "whether we can wipe malaria out of the United 
States," but, "will we?" (It appears that either we could not or 
we would not). 

Meanwhile a battle in official circles to force open the Farben 



PEACE 821 

patent on Atabrine had resulted in bitter clashes between the 
administration officials of the highest rank at Washington, and 
efforts in the Senate and the House of Representatives to conduct 
an investigation of the matter had resulted in threats and other 
types of coercion to prevent exposing the fact that the supply of 
this important medicinal was not all that it should have been. 

Senator Bone, Chairman of the Senate Committee on Patents, 
announced to the press on April 12, 1942 that the hearings which 
were to begin next day into restrictions on the use of Farben- 
owned patents would include the subject of synthetic quinine. 
But Senator Bone was in error. He was never permitted to open 
up his hearings of any feature of the Farben tie-ups with Sterling 
or Winthrop. His hands were tied although his committee sub- 
poena reached into the Anti-Trust Division of the Justice Depart- 
ment and seized over twenty-five thousand documents from the 
Sterling files and elsewhere, which revealed the details relative 
to Atabrine, as well as other facts which had been pigeonholed 
in September 1941 when Mr. Thomas Corcoran succeeded in 
choking off the Justice proceedings against Sterling. 

In August, over the vigorous protest of Senator Bone, five other 
members of the Patents Committee voted not to permit its Chair- 
man, and its two-fisted incorruptible counsel, Creekmore Fath, to 
produce a single witness, or document, relating to Sterling and 
Winthrop at a public hearing. 

Having been requested to assist the staff which was assembling 
the evidence, I watched with indignation these efforts to strangle 
the hearings. The five members of the committee who yielded to 
the persuasions of those who were determined not to have the 
Sterling- Winthrop situation disclosed, were Claude Pepper of Flor- 
ida; D. Worth Clark of Idaho; Scott W. Lucas, of Illinois; Wallace 
H. White, Jr., of Maine; and John A. Danaher of Connecticut. 

One of these five, Senator Pepper, prior to the vote which tied 
the hands of Senator Bone, received an appeal from the Non-Sec- 
tarian Anti-Nazi League to continue the hearings of the Patents 
Committee on the "patent and cartel connection between Ameri- 
can concerns and Axis interests until all pertinent facts have been 
uncovered/' Senator Pepper replied: 



222 TREASON'S PEACE 

Appreciate your message and am sure that investigation 
will be all-inclusive before it is finished. Regards. 

The Senator, according to Thomas L. Stokes in the World-Tele- 
gram of August 6, 1942, was a friend of Mr. Thomas Corcoran 
and the latter 

is proudly wearing another feather in his cap as a super 

lobbyist. He who once started Congressional investigations 
has now stopped one one that was due to produce sensa- 
tional revelations about a corporation with former German 
connections, which he has been protecting from the govern- 
ment. 

The Stokes article went on to describe two turbulent sessions 
of the committee in which Thurman Arnold, who had been so 
hot after other German cartel affiliates, took a very different posi- 
tion as regards Sterling Products, and favored dropping the in- 
vestigation. Said Mr. Stokes: 

So did Undersecretary of War Patterson who sat with the 
Committee, along with Leo Crowley, Alien Property Custo- 
dian Suppression of the Sterling investigation climaxes 

one of the most amazing examples of "inside baseball" ever 
seen here. Suspicions were aroused that high administration 
officials were trying to duck the inquiry when Mr. Crowley 
was asked to testify about Sterling with particular reference 
to the synthetic quinine monopoly which one of its subsidi- 
aries, the Winthrop Co. still owned 50% by I.G. Farben- 
industrie possess by virtue of its control of German patents- 
Mr. Growley kept postponing his appearance. Despite earlier 
assurances that he was going to take over the substitute qui- 
nine patents and release them generally he never did 

Questions in a public hearing might have proved em- 
barrassing. So he never did appear. 

Another short-lived effort to force out the facts about the Ata- 
brine supply was begun by Republican Congressman Bertrand W. 
Gearhart of California who made a brave start to accomplish 
this purpose in the House of Representatives on August 13, 1942, 



TREASON'S PEACE 223 

with a ringing speech on the Atabrine production in which he 
criticised what he called the dark curtain of mystery which had 
hung over the subject. Gearhart minced no words and ended his 
remarks with several queries: 

Therefore, Mr. Speaker, I ask what is being done to meet 
this critical situation? What is our supply? Has the free flow 
of this indispensable medicine quinine and its substitutes- 
been interfered with ? Is it true that our soldiers, sailors 

and marines are today threatened with disablement because 
of a scarcity of this indispensable medicine? What are our 
war leaders doing about this all-important problem? The 
American people are entitled to know and to know right now. 

The Congressman stated to me, and to others, that he proposed 
to continue the fight until an investigation should result, but the 
subject of Sterling and Winthrop and Atabrine was from then on 
definitely verboten in the House and Senate of the United States. 

Perhaps the most inexplicable aspect of the throttling of these 
Sterling- Winthrop investigations was the part played by Mr. Ar- 
nold in his official capacity, as compared with his caustic remarks 
in private, and, on one occasion, in public. In the Atlantic Monthly 
for August 1942, Mr. Arnold published an article relative to re- 
form of the patent law which he considered necessary and in 
this he discussed the control of the Atabrine patent by I.G. Farben 
as: 

The spectacle of the production of this essential drug, left 
so long to the secret manipulation of a German-American 1 
combination during a period when Germany was preparing 
for war against us, is too shocking to need elaboration. 

Shortly after Mr. Arnold had made this vigorous statement he 
was himself sitting in with the hush-hush Senators in the Patents 
Committee. 

About this time I was taken to the office of the Alien Property 
Custodian by a member of the Justice Department staff, and re- 
quested to give them such assistance as my knowledge of the 
Farben situation might permit. I was informed that the Custodian 
had seized 50 percent of the stock of Winthrop but had 100 per- 



224 TREASON'S PEACE 

cent control over its Atabrine patent. Also, that a contract which 
had been given to Merck to make Atabrine constituted a license 
(which it did not), and that no further licenses would be given 
because there was no necessity for them. Several other rather pe- 
culiar allegations were made to me on that visit. 

Six months later, after rather extended and unproductive cor- 
respondence with the members of the Custodian's staff I paid an- 
other call at that office. And as the acute shortage in the supply 
of Atabrine had by then reached a critical stage, I asked what 
they proposed to do about it. I was informed curdy that there 
was no shortage; that Winthrop was producing all the Atabrine 
that was needed; and that anyone who made such a statement 
was, in plain language, a liar. 

However, at that time it was common knowledge in Washington 
that a shortage did exist, and that allotments of this vital drug for 
the Army and Navy, and for the extension of malaria control in 
Latin America, had been necessarily reduced. 

Several months previously then Surgeon General of the Navy, 
Rear Admiral Ross T. Mclntyre, issued an urgent appeal to the 
pharmacists of the United States asking them to collect and do- 
nate all available supplies of quinine which they might have in 
reserve stocks in their dispensaries. In that appeal Admiral Mc- 
lntyre made this statement: 

Although Atabrine is a very valuable antimalaria drug, 
there are many individuals in whom quinine is still the drug 
of choice and in certain cases it is life-saving and cannot be 

replaced by synthetic drugs the need for more quinine 

is becoming increasingly urgent as the number of men fight- 
ing in malarial regions increases and the stock pile dwindles. 

Under these circumstances something had to give way, even 
though the most serious aspects of the shortage were given no 
official publicity. Beginning in January 1943, long after the short- 
age had become acute, arrangements were made quietly by which 
ten other manufacturers were instructed by the government to 
begin at once the production of Quinacrine Hydrochloride: some 
to make the base material; others to process it through the inter- 



TREASON'S PEACE 225 

mediate steps; and others to put it into tablets for distribution 
to the armed forces, and as Lend-Lease supplies for Latin America. 

The new Atabrine mess rescue squad now included, in addi- 
tion to Merck, the following: Abbott Laboratories, American 
Home Products Co.; Hilton Davis Co.; Eli Lilly & Co.; William 
S. Merrell & Co.; National Aniline & Chemical Co.; Pharma Chem- 
ical Corp.; Sharpless Chemicals Co.; E. R. Squibb & Sons, and 
Frederick Stearns & Co. 

None of these were given licenses permitting sale to the public. 
This monopoly was still reserved to Winthrop. The newcomers 
were merely given contracts to contribute to the huge government 
requirements for Atabrine which Winthrop had failed so tragically 
to supply. It is of interest here that among those thus invited to 
participate in the official Atabrine pie were concerns which al- 
legedly have had relations with I.G. Farben or with Sterling. 

Next to Sterling, American Home Products was the largest pat- 
ent medicine and cosmetic combination in the country, the Weiss 
and the Diebold families have been among the largest stock- 
holders. The Merrell company is owned outright by Vick Chem- 
ical, one of the Farben-Sterling affiliates in Drug Inc. Abbott and 
Squibb were reported to have had negotiations with Farben dur- 
ing the Drug, Inc., period; while National Aniline & Chemical, with 
its owner, Allied Chemical and Dye, were both among those 
indicted in 1942 for conspiracy with I.G. Farben in the dyestuff 
industry. 

And the hush-hush continued. One F. J. Stock, a division chief 
of the War Production Board, who handled the Atabrine expan- 
sion program, felt the strange necessity of keeping the whole af- 
fair an official secret. 

After several letters on the subject, Mr. Stock finally replied. 
On May 31, 1943, he wrote me that: 

A number of the most reputable drug companies are pro- 
ducing Atabrine. We do not, however, normally make avail- 
able names of producers of critical items Supplies are 

sufficient to meet Army, Navy and Lend-Lease requirements, 
as well as export and domestic civilian use. 



226 TREASON'S PEACE 

While the shy Mr. Stock refused to name his "most reputable 
drug companies," their identity was known throughout the trade; 
as was the undercover row which had been stirred up by the 
Alien Property Custodian's endeavor to protect Winthrop's mo- 
nopoly on the quinnine substitute, regardless of the needs of the 
Army and Navy. 

The War Production Board was not the only official agency 
which appeared reluctant to reply to queries about the Atabrine 
mess. Among others who declined to comment were the Federal 
Security Administration assistant, Mary Switzer, who, as ruler 
over the Public Health Service, had discussed the subject with 
me back in July 1940. At that time she told me the medical men 
in Public Health Service were expressing alarm because of the 
exclusive control the Atabrine patent by the Farben-Sterling- 
Winthrop management. Three years later, when the alarm had 
been vindicated, Miss Switzer chose not to discuss the subject. 

The National Research Council, which might be considered 
an official and, therefore, disinterested party to the Atabrine con- 
troversy, also refused to express an opinion or even to admit hav- 
ing one. Herr Goebbels himself could not have improved upon 
.the way someone perhaps Mr. Corcoran enforced the verboten 
order on all public mention of how Winthrop had failed to make 
good. 

As an aftermath of Vice President Henry Wallace's fights 
with Jesse Jones on the quinine shortage and with Leo Crowley 
on the Atabrine shortage Wallace was vindicated on both scores 
and then was fired from his job as Chairman of the Board of 
Economic Warfare after the row between the Vice President 
and Jesse Jones resulted in the President being persuaded to turn 
the whole mess over to Leo Crowley in July 1943. Why Mr. 
Wallace, the official who was right on Atabrine was made the 
victim of Mr. Crowley the official who was wrong on Atabrine 
is one of those things yet to be explained. 

The humiliating record shows Sterling- Winthrop executives, 
while boasting publicly of Atabrine as better than quinine, and 
of their huge production as saving the nation, were still entrenched 
behind the Farben patent and secretly refusing to permit others 
to utilize ample facilities for production and research, which 



TREASON'S PEACE 2*7 

Winthrop lacked, to supply the quantities needed and to correct 
admitted defects in the formula. 

The record likewise shows high government officials, charged 
with the duty to provide Atabrine to our armed forces, instead 
were secretly permitting this gross misuse of our patent law and 
defending Winthrop against all comers, while publicly they cov- 
ered up the facts and the disaster that resulted. 

The horrors of war are usually remote to those who remain 
at home. However, to the soldier or sailor whose life may have 
hung in the balance there could be nothing remote or abstract 
in the story of Atabrine. 

To those who may feel it difficult to appraise properly the 
significance of these facts about Atabrine it is suggested that 
they project themselves, in thought, to a hospital cot, or a fox- 
hole, in the jungles of Asia or the South Pacific; racked with 
malaria and near death as result of a wartime shortage of quinine 
or an insufficient supply of the only quinine substitute; which 
deficiency may have been caused by some one at the nation's 
capital who was aiding in the protection of alleged patent rights 
of I.G. Farben and its allies. 

Perhaps, some day, as one result of the part played in the last 
war by Farben, and by Farben's allies, will come a demand for 
new definitions of the words "enemy" and "treason." 



CHAPTER XII 



Patent Medicines And Freedom 

% 

of the Press 



IN MARCH, 1938 

the Council on Pharmacy and Chemistry of the American Medical 
Association announced that it was going to enforce a rule which 
provided that the Council should not "accept" products of a con- 
cern which was more largely engaged in selling patent medicines 
than in distributing ethical preparations. The rule had existed 
for many years, but had never been applied to the Winthrop, Alba, 
Metz and Cook subsidiaries of Sterling not even after the ghastly 
Sulf athiazole affair. Yet no firm had as many nationally advertised 
patent medicines as Sterling, and it may appear that no firm had 
made more dangerous false advertising claims than they. 

An interesting light on the attitude of this company appears 
in its first report to the stockholders, after its purchase of the Bayer 
company. This read, in part: 

Bayer aspirin was introduced throughout the United 
States by the medical fraternity, and it is the object of Ster- 
ling Products to popularize this product to the laity by means 
~ 



TREASON'S PEACE 229 

of newspaper advertising and other mediums of publicity. 
Sterling Products is the largest advertiser in the world. We 
believe we know more about proprietary advertising than 
anyone else, and as far as aspirin is concerned, we know 

that the field has been merely scratched on the surface 

We intend to develop Bayer aspirin not only in this country 

but all over the world we estimate that the earnings 

of these two companies will be at least $2,000,000 per year, 
and we know that the future of the business is a bright one. 

Mr. Weiss either underestimated his own capabilities or else 
he had not begun to realize how far he would go with Farben's 
help. In the next twenty years the gross profit was to increase to 
more than seven times that estimate. And in those two decades 
Sterling spent many millions of dollars to popularize the name 
Bayer, and to hold the price at a level which showed at least 
1,000 percent spread between the cost of acetylsalicylic acid and 
the price that the consumer paid when he specified Bayer. 

As the Sterling position grew stronger, fantastic advertising 
claims were made about the cure-all properties of Bayer aspirin. 
Salesmen for the company alleged that their employers had ample 
medical opinion to support their advertising, but somehow, those 
opinions were not broadcast with the identifications of the physi- 
cians who allegedly gave them. 

Throughout this period, the Journal of the American Medical 
Association, and its Council on Pharmacy and Chemistry, were 
strangely silent. And the A. M. A/s widely heralded reform cam- 
paign contended itself mainly with exposing little-known fake 
nostrums in which few of the public and none of the physicians 
could have had any possible interest. The fact that the Bayer 
claims went uncontradicted by the spokesmen for the medical 
profession was the strongest argument in Sterling's favor, at least 
in the minds of the public; and many professional men justified 
their own silence by that of the A. M. A. 

It was in this period that purchasers of the tablets were handed 
the little tin box, or the bottle, enclosed in an envelope on which 
the utterly false claim, "Genuine Bayer Aspirin Does Not Harm 
The Heart" appeared in conspicuous lettering. This use of a false 



230 TREASON'S PEACE 

legend on an enclosure, or circular accompanying the package, 
was criminal misbranding under the Wiley law. And while Mr. 
Campbell of the Food and Drug Administration steadfastly re- 
frained from taking any action to restrain Bayer, another maker 
of aspirin a small concern in Little Rock, Ark., was taken into 
court in 1933 for precisely that offense f or claiming that his aspirin 
would not depress the heart. 

The Bayer advertising was national advertising on a huge scale, 
and it served a double -purpose; it sold enormous quantities of 
aspirin at a tremendous profit, and it served to legitimatize a huge 
subsidy to the press of the United States at a time when the friend- 
ship of the publishers was highly essential to the purpose of Far- 
ben. Such leading newspapers as The New York Times held their 
noses, and accepted the account. 

The following are a few examples of the countless indecencies 
published as legitimate advertising by American publications: 

Bayer Aspirin quick complete relief and no harm 

done no effect on the heart; nothing in a Bayer tablet 

could hurt any one it can head-off the pain altogether; 

even those pains many women have thought must be en- 
dured. 

Hearst's Cosmopolitan, Jan. 1929. 

The fastest possible relief the sure safe way is to 

see that the name Bayer is on any tablet that you take 

carry in mind too that Genuine Bayer Aspirin Does Not 

Harm the Heart. 

Collier's, Sept. 24, 1929. 

Headaches come at the most inconvenient times 

often it's the time of the month why wait Bayer 

Aspirin can't harm you because there is nothing harmful in it. 

N. Y. Daily News, Nov. 11, 1930. 

Sick headache the modern woman feels a headache 

coming on systematic pains Bayer won't fail you 

and can't harm you. They don't depress the heart and 

take enough to stop the pain. 

N. Y. Journal, Nov. 5, 1931. 



TREASON'S PEACE 231 

They don't depress the heart and may be taken freely. 
That is medical opinion. 

N. Y. Sun, Oct. 15, 1931. 

Genuine Bayer Aspirin will not harm you. Your doctor 
will tell you it does not harm the heart. 

Saturday Evening Post, Nov. 26, 1932. 

Don't take chances with "cold killers" and nostrums 

the quickest, safest, surest way get the real Bayer 

Aspirin tablets. 

Capper's Weekly, Dec. 24, 1932. 

Quicker relief the fastest, safe results, it is said, 

ever known to pain Genuine Bayer Aspirin does not 

harm the heart. 

McCalTs, Nov. 1933. 

Of course the Bayer advertising was not the only instance of 
false claims by Sterling; it was merely the most extensive and the 
most obvious. At the same time, because of its utter disregard for 
truth and legality, it appeared to be the most vulnerable point 
of attack upon Farben's American-drug front. 

Accordingly, in 1929, 1 decided to force the matter to an issue. 
Sterling, I knew, was wide open under both the Federal Trade 
Commission Act, and state laws. My campaign got under way 
with an open letter to Dr. Fishbein, which included the following 
queries: 

Why is it that in your "exposure" of fake influenza cures 
(A. M. A. Journal, Jan. 19, 1929, page 253) you failed to 
mention any of the products of the one large group of brands 
and trademarks under a single unified financial control, de- 
spite the fact that this group was among the most flagrant 
violators of all the canons of medical ethics in the advertising 
it published at that time? 

Was this suppression because this same unified patent- 
medicine group, unbeknown to the rank and file of the medi- 
cal profession, also controls about one out of every five retail 
pharmacies in the country along with a number of the largest 



232 TREASON'S PEACE 

and supposedly most ethical pharmaceutical manufacturers, 
whose constant advertising in the A. M. A. publications must 
be very profitable financially? 

Will you or will you not list the brands, trademarks and 
company names of this gigantic monopolistic group or "corner" 
of patent and ethical medicines and pharmacies, and indicate 
which are financial supporters of the A. M. A. Journal and 
of Hygeia together with the extent of their existing control 
of the medicine industry and of its advertising expenditures? 

As an ethical medical question, what is your opinion of 
patent and proprietary-medicine advertising which teaches 
materia medica, self -medication and home treatments by the 
legends on the bottles, and glowing advertisements in the 
lay and popular press? 

Then in 1930, before a Senate Committee on the enforcement 
of the Wiley Food and Drugs Act, I took the opportunity afforded 
by a rebuttal statement to force the issue of the Bayer advertising 
into the official records of the Senate. One of my statements in 
these hearings was as follows: 

To those of your committee who may now say that I am 
going far afield from the enforcement of the Federal Food 
and Drugs law permit me to point out that a situation such as 
I have attempted to disclose has always two general motives 
greed and power. 

So in this presentation I deem it my duty to point in one 
direction where your committee may, if it follows through, 
discover a part of the responsibility for the flooding of this 
country with impure drugs; and far more important and 
menacing a long arm reaching out in an attempt to control 
by devious ways not only our health but some of our vital 
resources for national defense and our channels of public 
information and editorial opinion. 

I repeated this same statement several times over the air in 
the fall of 1930, when for a few short weeks I was given broad- 
casting privileges by a small station owned by a brother of 
Bernard Baruch. Then one evening the engineer in charge of the 



TREASON'S PEACE 233 

station greeted me with, "Better give 'em hell tonight, mister, this 
is your last chance." 

"How come?" I asked, "My time isn't up." 

"Your time may not be," was the answer, "but the station's is." 

"I just got my orders to tear 'er down, and down she comes 
tomorrow." 

So ended that! I might add here that when I asked permission 
to speak on the subject over the National Broadcasting Company 
chain, I was informed that it would not be ethical, and that the 
management feared that what I had to say might alarm some of 
its audience. There was much truth in that latter conclusion. 

Not long after the 1930 Senate hearings appeared in print, and 
my broadcasting had met its sudden demise, I wrote to the presi- 
dents of all the state medical societies calling their attention to 
the abominable character of the Bayer aspirin broadcasting and 
advertising as: 

absolutely contrary to the truth as regards legitimate 

medical opinion, and a distinct menace to the public health 

I am writing you this letter to ask what the medical 

profession, and the organization of which you are the head, 
proposes to do about this. 

For good measure, I added this postscript: 

as I stated over the air last fall, the man who wrote 

this aspirin advertising, and the executives of Drug Inc., re- 
sponsible for it, ought to be in jail. 

Copies of this letter were sent to various publishers; one went 
to the late Louis Wiley, business manager of The New York Times; 
and to my gratification Mr. Wiley replied promptly, as follows: 

Dear Mr. Ambruster: 

We acknowledge your letter of November 17th, and a 
copy of your letter concerning the advertising of a medical 
preparation. 

The New York Times regularly takes up with various 
scientific authorities any advertising which is offered to us. 

We have recently been looking into this specific statement 



234 TREASON'S PEACE 

concerning which you write. Originally the statement was 

made to us by more than one physician that this preparation 

did not depress the heart. Our physicians now inform us that 

in certain cardiac cases there may be a depressive effect. 

We have already taken up the matter with the advertiser. 

Very truly yours 

Louis Wiley. 

And for a period the Times did not carry Bayer aspirin adver- 
tising. Then it backslid. I had several heated discussions with 
that paper's advertising censor, who described himself as a high 
churchman, although what that had to do with false advertising 
I did not entirely comprehend. He never appeared to get my point 
of view, and I confess I never got his. 

However, immediately after receipt of Mr. Wiley's encouraging 
letter, I put the matter up to the Federal Trade Commission by 
sending them copies of the correspondence with Mr. Wiley, with a 
statement that I assumed the Commission would immediately 
institute proceedings to stop that kind of advertising. I also of- 
fered to submit additional data. My assumption of immediate ac- 
tion was incorrect. All that the Commission instituted, so far as 
Bayer was concerned, was two-and-a-half years of procrastination 
and evasion. 

Meanwhile my letters to the state medical societies had brought 
a few responses. In one of them, a president of the Kansas Medical 
Society, Dr. L. F. Barney, assured me that he was wholly in 
accord with my reference to criminal advertising, and that due 
to such advertising, far too much aspirin was being taken. 

Another state society president, Dr. Arthur S. Fort, of Atlanta, 
Ga., advised me that there were regularly organized agencies of 
the Government, and the American Medical Association, to handle 
such matters and that he would await their instructions before 
acting. Apparently these agencies instructed the good doctor to 
forget it. 

In December 1931, 1 began needling the National Broadcasting 
Company stations that carried the Bayer Program, and, for good 
measure, threw in some pointed comments about Dr. Fishbein and 
Dr. Copeland. The latter at that time was on the air for Sterling's 



TREASON'S PEACE 235 

Milk of Magnesia which was sold to the public as Phillips, the 
name of its original producer. My first letters to the stations 
concluded with the following: 

Won't you also advise me whether you are handling the 
N.B.C. hookup for the women in the week-day morning 
hours when that Senatorial medical faker, Royal S. Copeland, 
is handing out propaganda for this same Drug, Inc., concealed 
under the title "Health Clinics'? 

You are at liberty to read this letter over your station if 
you so desire. 

Those stations that did not reply promptly to my first letter 
received a follow up which repeated my challenge to Drug, Inc., 
to produce a single reputable member of the medical profession 
who would publicly defend the allegations made on behalf of 
Bayer. 

With the first of these letters the fun began in earnest, with 
the honors undoubtedly going to one Clarence G. Cosby of Sta- 
tion KWK, St. Louis, Mo., who headed his letter: 

Re Criminal Aspirin Broadcasting 

This station does not broadcast the Bayer aspirin account or 
Senatorial medical faker, Royal S. Copeland. 

One other station, KGA, of Spokane, Wash., indicated that the 
matter had been taken up with NBC and, for the time being, Bayer 
advertising was not being released over that station. 

Others, however, were critical or querulous of my intrusion, 
and my motive in the matter gave them more concern than the 
falsehoods they were sponsoring. Some of the replies were in- 
triguing, and a few are worthy of brief note here: 

The Secretary of the Maine Medical Association (advises) 
that your claim as regards the ethics of aspirin advertising 
from a medical standpoint, do not hold in this territory at 
least. Eastland Station, Portland, Me. 

See nothing criminal about either the aspirin or the pro- 
grams in which Copeland is featured. WEBC, Superior, Wis. 



236 TREASON'S PEACE 

Suggest that you take the matter up with the proper medi- 
cal authorities Until you do something about what you 

plainly call a criminal situation, I doubt that 1*11 have time 
to conduct any more correspondence. WDAY, Fargo, N. D. 

The Bayer's Aspirin program and Dr. Royal S. Copeland's 
Health Clinic program are very well received and we regard 
them as praiseworthy. WJDX, Jackson, Miss. 

interested to know just what your connection is 

which would make these programs so objectionable to you. 
WKY, Oklahoma City, Okla. 

I cannot see anything in the credit lines of the Bayer's 
aspirin copy that could be considered harmful. WMAQ, 
Chicago, III. 

We do not hesitate to accept any program which the N.B.C. 

send us We feel that the complaint you make is their 

problem, not ours. WRVA, Richmond, Va. 

I continued to badger the stations as long as any of them would 
reply. Only one answered more than two letters, and apparently 
all that any of them did, save those at St. Louis and Spokane, 
was to pass the buck to NBC or to Dr. Fishbein. 

When the Crosley stations WLW and WSAI of Cincinnati 
demanded to know my identity and business connections I sent 
them the information, and added a suggestion that they notify 
NBC that they would discontinue broadcasting the Bayer program 
unless NBC and Drug, Inc., brought immediate criminal action 
against me for libel. That ended the correspondence with Crosley. 

KOMO, of Seattle, Wash., sent me a copy of a letter signed by 
the executive secretary of the Public Health League of Washington 
which stated that from a purely health standpoint the Bayer ad- 
vertising was not objectionable. My correspondence with the Pub- 
lic Health League brought no response except a rebuke for my 
reference to Dr. Fishbein which, they wrote, "seems entirely un- 
justifiable/' Apparently, the members of the league were indiffer- 
ent to positive proof of injury to the public health. But they 
went all out to defend the professional standing of the medical 



TREASON'S PEACE 237 

editor whose prolonged silence on the subject was the one chief 
reason why Sterling was able to avoid prosecution for the false 
and dangerous claims. 

Another set of letters went to more publishers, and W. L. 
Chenery, Editor of Collier's, responded in one instance with the 
emphatic statement that "Colliers does not publish patent-medi- 
cine advertising/' I wrote back asking how he classified Bayer 
aspirin. And that ended that. 

Throughout this one-man campaign, governors and attorney 
generals were receiving my demands that they prosecute the 
Bayer company under their rigid state laws. The Governors 
usually stalled or referred the matter to their health officials. In 
not one instance was any action taken, but some amusing replies 
were received. 

Governor Pinchot's Deputy Attorney General naively referred 
to the Bayer broadcasting as originating not in Pennsylvania but 
in New York, and wrote that he would be pleased to hear from 
me as to what action, if any, New York State had taken in con- 
nection with the alleged misrepresentation. My reply called atten- 
tion to the fact that several NBC stations in Pennsylvania carried 
the Bayer advertising, and that*newSpapers circulated in his state 
did likewise. 

The Governor of New York, Franklin D. Roosevelt, referred the 
Bayer hot potato to John J. Bennett, the State Attorney General. 
And Mr. Bennett, through a subordinate, advised me that his 
"unofficial answer" was that the matter was one for the local 
district attorneys. 

Governor John G. Pollard of Virginia wrote me graciously if 
plaintively, that: 

It is a national question, and there is no legislation in 
Virginia that will allow us to deal with the question ade- 
quately. 

I replied quoting chapter and verse of the Virginia statute 
which penalizes false advertising, and reminded the governor of 
the ancient and honorable doctrine of States Rights. No response. 

The Indiana State Board of Health also had a good excuse; 
its secretary advised me that that Board "is not charged with 



238 TREASON'S PEACE 

the responsibility of enforcing any statute either specific or general 
on this subject." 

Governor Albert C. Ritchie of Maryland, referred me to the 
State's Attorney at Baltimore, one Herbert P. O'Coner, who in 
1939 was also to begin a long career as Governor. Mr. O'Coner 
advised me that no action condemning the Bayer advertising 
had been taken by either state or city medical organizations, 
and that: 

if criminal action is to be taken it should be as a result 

of some action taken by the American Medical Association. 

So here again the evidence of criminal advertising, which was 
broadcast to millions over the air, and circulated in millions of 
printed pages, was officially weighed in the balance against the 
silence of Dr. Fishbein; and as usual the silence won. 

Finally, in April 1933, John A. Renoe, an able and earnest attor- 
ney for the Federal Trade Commission, paid me a visit, and in- 
formed me very frankly that, more than sufficient evidence was 
available to sustain a complaint against Bayer, which he said 
would be filed very soon. Mr. Renoe evidently meant business, 
and I rejoiced but too soon. Several weeks later I called at the 
New York office of the Federal Trade Commission and was advised 
that Mr. Renoe had been transferred to another "highly important" 
investigation. His successor on the Bayer case indicated that the 
subject bored him, and demanded to know what my motive was 
in persisting in the matter. The "highly important" investigation 
to which Mr. Renoe had been transferred I was later informed, 
concerned the possible injurious effect of the iodine content of 
seaweed, when used as cattle feed, upon the digestive processes 
of cows! 

About that time a shakeup took place in the Federal Trade 
Commission. Former chairman W. E. Humphrey was booted out 
by the President, and a new Commissioner, former Congressman 
Ewin L. Davis of Tennessee, came in. Judge Davis was one of 
the very few members of the House of Representatives who had 
acknowledged receipt of my chart and proposed resolution and, 
as Chairman of the House Committee in charge of Radio legisla- 
tion he proposed to do something about it. 



TREASON'S PEACE 239 

He did what was probably the most useful thing a man of his 
high character could do; he accepted the appointment to the 
Federal Trade Commission, and, in 1934, forced through a com- 
plaint against Bayer, and compelled Sterling to accept a cease 
and desist order, without defense, and thus admit on the official 
record of the case that every single therapeutic claim they had 
made for the safety, and curative powers of Bayer Aspirin, was 
false, misleading, and illegal; and would not be repeated. The 
complaint also required that Bayer cease to claim that only Bayer 
was true aspirin, and that competitive brands were spurious. 

However, Sterling did not give in immediately or graciously, 
and for some time the illegal advertising continued. It must have 
been impossible for the Sterling-Farben regime to believe that 
such an affront to its power and prestige could persist. Finally, 
one Sunday evening, my wife and I were listening to the radio to 
find out if Howard Clancy would repeat his unctuous statement, 
"It cannot harm the heart." The program ended, and Mrs. Am- 
bruster turned to me with, "Daddy, he didn't say it. You've actu- 
ally done it at last!" But it was Judge Ewin L. Davis who had done 
it. For once Farben and Sterling had met their match. 

The significance of this Bayer aspirin story, as it serves to illus- 
minate the Farben pattern, is twofold; the criminal violations of 
the law were publicly committed over a long period of years and, 
as these facts reveal, hundreds of respectable citizens, many of 
them prominent, were involved directly or indirectly. Some of 
them knew that such advertising was dangerously false and 
illegal, yet would make no move to help put a stop to it. Call it 
fear, call it corruption, call it indifference this long period of 
inaction by so many goes right to the crux of the pattern of 
Farben's intrusion on the affairs of the American people. 

In March 1935, nine months after the Federal Trade Commission 
had started its proceedings against Bayer, and members of the 
Medical Society of New Jersey were publicly criticising the ad- 
vestising policies of the A. M. A. Journal, the Council on Pharmacy 
and Chemistry issued its first report on the Commission's action, 
and Dr. Fishbein, in an editorial, made the first comment on Bayer 
aspirin that had appeared in the Journal since May 14, 1921, save 
for praise of Sterling advertising. 



240 TREASON'S PEACE 

At this late date, the Council and Dr. Fishbein approved the 
action of the Federal Trade Commission, and summarized the 
voluminous medical data long available which proved the falsity 
and the danger to public health of the various Bayer claims. The 
final paragraph of the Council's 1935 report included the following: 

The indiscriminate use of Bayer aspirin, as urged in the 
advertising, is inimical to public and individual health, both 
directly and indirectly. Aspirin ( acetylsalicylic acid) is po- 
tentially a dangerous drug and its unqualified use as a home 
remedy should be undertaken, originally in any case, under 
the guidance of the family physician, whose knowledge of 
the personal characteristics of the individual patient can alone 
render such use safe and advisable. 

It is of course impossible even to estimate how many individuals 
in the United States were injured by the unwise use of aspirin in 
those years of silence on the part of the A. M. A. It is quite possible, 
however, to reach the very definite conclusion that that silence 
contributed in several ways to the consummation of Farben's plans 
for the present war. 

After its squelching by the Federal Trade Commission, Sterling 
continued to advertise Bayer aspirin on a lavish scale, but did 
not repeat the forbidden claims. Its revised appeal rested upon the 
fact that the aspirin dissolved quickly in a glass of water; price 
reductions also received constant mention. The ads did not ex- 
plain that the quick dissolving was due to the addition of corn- 
starch or some other harmless ingredient. 

More recently Sterling started a new series of full-page adver- 
tisements depicting famous discoveries of serums and medical 
remedies (with which Sterling has no connection). Only the 
lower section of the page mentions Bayer "The Famous Name in 
Aspirin/' In view of the history of the company the choice of 
the word, "famous," seems an unfortunate one. Bayer would 
hardly appear a name to brag about in the United States. 

Finally resorting to claims, in radio advertising, that the drug- 
gists of America were sponsoring a national advertising campaign 
for "Bayer" aspirin, and that the price had "recently" been re- 
duced to fifteen cents per dozen; the Federal Trade Commission 



TREASON'S PEACE 241 

again jumped on Sterling, in June 1946, charging that the drug- 
gists were not sponsoring and the price had been fifteen cents for 
years. 

Then, shortly after this unfortunate incident Harvey M. Manss, 
Sterling's Vice President in charge of Bayer, was announced as 
the new Chairman of the Proprietary Association Committee on 
Advertising, to set up rules for decency in advertising copy. 

The period of time required to induce action against Bayer, 
overlapped the span of existence of Drug, Inc., which had planned 
to continue its expansion and become the American counterpart 
of Farben as a drug and patent-medicine cartel. Among those tied 
in with Sterling in Drug, Inc., it will be recalled, was The Bristol 
Myers Company. 

The Bristol Myers advertising presented a number of fine tar- 
gets for the Federal Trade Commission sharpshooters. Much of it 
was so fat with absurdity and glamorous untruth that, when the 
Commission finally went to work on it, it was like shooting ducks 
in a barrel. Five of the best-known products of the firm were 
brought down with cease and desist orders; another has been 
shot at, but is still on the wing as this is written. 

Those to feel the corrective action of the Commission's stop- 
lying orders were, Sal Hepatica, Ingrain's Shave Cream, Ingram's 
Milkweed Cream, Minit-Rub and Vitalis. Action against the claims 
for Ipana Toothpaste was still pending over three years after it 
was started. 

Early in 1931, before the start of the all-out fight on Bayer 
aspirin, Sterling had started an advertising campaign for its Phil- 
lips' Milk of Magnesia in which mothers were warned of children 
having been made ill by "bad" milk of magnesia. Therefore only 
Genuine Phillips' should be specified, etc. The resentment of 
competing manufacturers, and threats of retaliation, finally caused 
Sterling to withdraw this type of copy. 

Some years later, Phillips started advertising two milk of mag- 
nesia cosmetic creams with the fantastic claim that they would 
overcome a disease called "acid skin" (which is non-existent). 
Again the Federal Trade Commission called a halt. And in 1946 
another action was begun on claims for Phillips Milk of Magnesia 
facial creams. 



342 TREASON'S PEACE 

One of the earliest Sterling remedies was Cascarets, long ad- 
vertised as safe for children. The advertising, and the label, dis- 
played claims that the preparation was essentially a harmless 
candy, and that physicians declare cascara ( a botanical drug ) an 
ideal laxative. However, it finally leaked out that a habit-forming 
coal-tar derivative, phenolphthalein, was being added to the pills 
without any change in the label or warning that cascarets were no 
longer harmless. 

In 1933, various uncontested actions resulted in condemnation 
of these new-style Cascarets, and, two years later, criminal prose- 
cution was begun (after complaints of lax-enforcement of the 
Wiley law). This was the first time that Sterling Products had 
ever been taken into court in a prosecution of this kind. However, 
it caused Sterling only slight inconvenience; their attorneys al- 
leged that the complaint was so vague they could not answer the 
charges intelligently. A West Virginia judge appeared to agree 
with them, and dismissed the case. Why the government never 
amended the complaint so as to remove the alleged vagueness 
does not appear on the record. 

Another patent medicine of a Sterling subsidiary on which the 
formula was changed, and which got into serious trouble, was 
Midol, sold originally by the General Drug Co. Midol was exten- 
sively advertised as a harmless remedy for the ills of women: 
"Midol is the discovery of specialists"; "Midol means complete 
comfort for women"; "No need to suffer, no need to be inactive"; 
"It is not a narcotic"; "It is safe," etc., etc. These statements were 
grossly false. The label did not say so, but Midol was a power- 
ful compound containing aminopyrine (or amidopyrine). 

In 1936 and 1937, Mr. Campbell seized shipments of Midol in 
several states, alleging that it was misbranded as a safe remedy 
for women. In all of these cases Sterling chose not to enter any 
denial of the accusations of dangerous fraud. As these proceed- 
ings were libels directed merely at this highly dangerous nostrum 
itself and not against the maker, the responsibility of the Sterling- 
General Drug people for it was never explored in a court action. 
Mr. Campbell chose not to prosecute. 

Some interesting inside information about the Midol affair was 
uncovered in the material assembled from Sterling's files in prep- 



TREASON'S PEACE 243 

aration for the 1942 hearings before the Senate Patents Committee. 
A. record of the minutes of a conference held at Leverkusen in 
1935 between Dr. Weiss, his son, and Farben officials, stated that 
the 1934 turnover on Midol had been $629,000 with sales increas- 
ing in 1935. 

The amidopyrine scare has therefore not had any effect 

on this preparation, as its composition is not made known 

popularly. 

The minutes went on to indicate that Midol was being sold in 
the Argentine as Evanol. 

Another memorandum, which was represented as prepared in 
Mr. McClintock's office in 1936, referred to the fact that amido- 
pyrine had been placed on the poison list in England. And, on 
September 2 1937, according to a file copy, the Weiss Secretary 
wrote to Mr. McClintock: 

I have just received from Mr. Weiss your telegram of 
August 31st (re Midol seizures), on which he has made the 
following notation, for your attention: "this is serious; can you 
use your influence in Washington to get this settled"? 

A strange request to make to one of the financial pillars of the 
Democratic National Committee which was appealing for the 
support of the feminine voters of the nation. 

The upshot of the impasse on Midol, according to these records, 
was a determination to salvage the stock already made up by 
shipping it out of the United States. One memorandum indicated 
that Mr. McClintock would discuss with Mr. Wojahn, his export 
manager, the possibility of getting rid of the nasty stuff in the 
Argentine and Cuba. Another indicated that Argentine health 
authorities were already aware of the dangerous ingredient in 
Evanol, and objected to its sale; so the McClintock influence was 
again called for. This time McClintock was instructed by Weiss to 

use every possible means to get pressure from Wash- 
ington which will allow us to import these old Midol stocks 
into Argentine. Please keep me informed. 

That kind of international team play might be called the Bad 
Neighbor policy of Sterling under Farben direction. 



244 TREASON'S PEACE 

And at the very time all this was going on, Sterling's Frank 
Blair made a speech about overseas drug markets before the 
Export Managers Club. Said Mr. Blair: 

a single racketeering concocter of a fake cure can 

bring discredit on the entire industry, and when the law 
catches up with him he frequently flees with speed to the 
export markets. 

Which, coming from a Sterling executive, was about as neat a 
bit of irony as one could ask. 

In 1937 the Federal Trade Commission also closed down on 
Midol, and Sterling was compelled to admit the falsity, and agree 
to discontinue all claims that Midol was a special medicine, or 
that it was recommended by specialists, or that it was safe. Those 
women readers who may have wondered what became of the 
old style Midol now know the story. 

Among the well known remedies which many do not realize 
is owned by Sterling, Ironized Yeast ran afoul of the Food and Drug 
people in 1941 for misbranding claims that this preparation would 
add to the user's weight, vigor, charm, and other blessings. Not- 
withstanding this official rebuke Ironized Yeast was in trouble 
again in 1944 for press and radio claims that its vitamin content 
builds rich red blood and cures low spirits, jitters, and lack of 
energy. These allegations the Federal Trade Commission rudely 
denied as fiction. 

And, curiously, a seizure of misbranded "Special" pills, and of 
"Formerly Madam Dean" pills, occurred on July 6, 1944, less than 
a week after Sterling had taken over Frederick Stearns & Co. of 
Detroit, a company which had been making both ethical and 
trademarked preparations. In this case the "Formerly Madam's" 
pills and the "Specials" lacked label warnings of dangers if used 
under certain conditions. However the new proprietors should 
not be blamed for these oversights; and this was not the first 
time that Stearns preparations had been in trouble with the pure 
drug laws. 

Another huge group of home remedies was acquired by Ster- 
ling when it purchased the R. L. Watkins Company in 1934, and 
soon thereafter the advertising of Dr. Lyon's tooth powder, a 



TREASON'S PEACE 245 

Watkins product, drew the fire of the Commission, and received 
a cease and desist order on the claim that it would correct acid 
mouth. 

Watkins products taken to court in numerous actions for mis- 
branding or aduleration, or both; included Aspirol tablets, two 
Watkins headache and cold remedies; vitamin pills; cod liver oil 
tablets; and tonic for hogs and chickens. Quite a range. 

Among other showpieces of this assortment of Sterling exhibits 
the parent company was caught in 1943 shipping adulterated 
senna, a U.S.P. product; and two of its other subsidiaries were 
in double trouble with both the Drug Administration and the 
Trade Commission. These were the Vita Ray Company which 
Sterling took over in 1938 and let go of in 1943; and the W. B. 
Caldwell Company which is one of the oldest Sterling possessions. 

In 1941 Vita Ray Vitamin Cream, another vitamin product for 
which the label claimed power to produce soft, radiant smooth skin, 
was decreed misbranded under the Food, Drug & Cosmetic law; as 
was a Caldwell vitamin product labeled for pale underweight 
females. Despite these warnings the companies did not reform; 
so in 1942 and '43, the Commission ordered Sterling to stop ad- 
vertising that Vita Ray Vitamin Cream cured wrinkles and coarse 
pores, made its user radiantly happy, and that its discoverer was 
honored in the Hall of Science. The Commission also decreed, in 
abrupt legal language, that no more claims should be made that 
the pepsin in one of old Doc. Caldwell's compounds had any 
effect on its therapeutic qualities. 

Before closing this grim and incredible tale of deceit and lying 
in advertising, mention might be made of a Standard Oil (N. J.) 
product called Mistol put out in different forms which have been 
in trouble with the Food and Drug Administration over a little 
matter of misbranding, and with the Federal Trade Commission 
for advertising which did not sufficiently warn prospective users 
that these nose drops were not safe for feeble infants nor for vari- 
ous types of adults. 

It should be stated here that evidences of many more violations 
of the Food and Drugs Act are concealed in the secret files of the 
enforcement officials then ever become public in court proceed- 
ings. However, sufficient evidence is available in the cases which 



246 TREASON'S PEACE 

have been mentioned here to illustrate the indifference and con- 
tempt with which Farben's patent-medicine partners have re- 
garded public health, the professions of pharmacy and medicine, 
and the governmental agencies charged with law enforcement. 

In September 1934 a few weeks after the cease and desist order 
in the Bayer aspirin case was issued, Dr. Weiss announced Ster- 
ling's advertising plans for the following year. For Bayer aspirin 
these plans included 1200 newspapers, leading magazines, and 
radio programs on both national networks. Phillips' Milk of Mag- 
nesia; Dr. Caldwell's Syrup of Pepsin; General Drug's Midol; 
California Syrup of Figs; and Fletcher's Castoria were among the 
numerous subsidiary products for which advertising was then 
announced to be placed in 3,500 newspapers, in magazines, in 
radio and in drug store display material. 

Advertising expenditures of the Sterling group alone, can only 
be guessed at. In 1935 the total for twenty years was given as 
not less than 150 million dollars. In 1940, Sterling's-radio bill alone 
was just under six million dollars. And in 1941 it was reported 
that its advertising in Latin America ran to about two million 
dollars. 

We know the sales formula of the patent medicine industry: 
one third for production and distribution, one third for advertis- 
ing, and one third for profit. Examine Sterling's 1942 financial 
statements: gross sales approximately $53,400,000, and gross profit 
(before taxes) approximately $16,000,000. The one-third-profit 
formula about checks, and it can be accepted that Sterling is one 
of the half-dozen largest advertisers in this country. We are con- 
fronted with staggering totals if we add to Sterling's the advertis- 
ing expenditures of Farben's other industrial partners in the 
United States. 

Here then, is a tremendous sum of money which conceivably 
might have been used to exert pressure on publishers to suppress 
or color news, and to modify editorial opinion. That the same pro- 
cedure operates for radio stations has been made apparent. 

In 1932, when Bristol Myers was a Farben affiliate through 
Drug Inc., its vice-president, Lee H. Bristol, was also president 
of the Association of National Advertisers, of which the Farben- 
Sterling affiliates were important members. The Association at- 



TREASON'S PEACE 247 

tempted to put the heat on publishers who were expecting to 
share the advertising budgets of its members by threatening to 
reduce their expenditures unless the publishers acceded to their 
wishes. Moreover, the threat was publicly made. 

Pointed comment on this came from Editor and Publisher, lead- 
ing journal of the newspaper fraternity, whose forceful editor at 
that time Arthur T. Robb, was always at his best when castigating 
any suggestion of censorship. 

In an editorial on May 11, 1929, Editor and Publisher com- 
mented on conditions in the drug industry, and then declared: 

If a pharmaceutical trust can use its advertising appropria- 
tion as a screen to cloak the unlawful manufacture of prepara- 
tions which aggravate rather than ease the pains of illness 

The scandal involved makes the power trust's iniquities 

virtues by comparison. 

More revealing was the radio debate between Secretary of the 
Interior Harold L. Ickes and Frank Gannett, in January 1939. 
The celebrated curmudgeon sustained his argument that the press 
was not free by the charge that the patent-medicine and cosmetic 
industries, through their advertising agencies, had directed the 
newspapers to kill the original Tugwell Food and Drug Bill. 

A few days later the Philadelphia Record, suffering from an 
overdose of remorse, or from a desire to please Mr. Ickes, stated 
editorially that much he had said was true, adding: 

We are ready to confess that along with the rest of the news- 
papers we deserve criticism for the shameful part the press 
played under pressure from patent-medicine advertisers in 
fighting the so-called Tugwell Bill in 1933. 

The accusation and the admission were clean cut enough to 
sustain our thesis that the German I.G. Farben, through Sterling 
was in a position to put pressure on the publishers of this country. 
Mr. Ickes, however, appeared to weaken his own case in this re- 
spect when he picked the Gannett newspapers and New York 
World Telegram of the Scripps-Howard chain as two of his targets. 

It so happens that Mr. Chauncey F. Stout, publisher of the 
Plainfield, New Jersey, Courier-News, a Gannett paper, has 



248 TREASON'S PEACE 

opened his news columns time and again to my battle with Far- 
ben's affiliates when the story was being ruthlessly suppressed 
elsewhere. And no newspaper editor in America has been more 
willing to publish news and editorial expressions which have dealt 
severely with Farben and the Sterling patent-medicine group 
than Lee B. Wood, Executive Editor of the World-Telegram, 
while Thomas L. Stokes, as a Scripps-Howard feature writer, con- 
tributed by far the most powerful series of exposures on the Farben 
influence in official Washington of any writer in the country. 

Nor did the World-Telegrams gentle and fair-minded premier 
columnist, the late Raymond Clapper, ever pull his punches in 
comment about Farben's lobby. 

However as to publishers in general, and especially as to cer- 
tain very conspicuous ones, I accept Mr. Ickes' accusation, and 
the Records confession, that they all got kissed and some kissed 
back. 

On May 15, 1943, the Journal of the American Medical Associa- 
tion reported on another defective preparation, Fletcher's Castoria, 
put out by one of Sterling's companies, with the statement that: 

At the time The Journal goes to press there seem to have 
been three deaths in which physicians reporting the inci- 
dents feel that the toxicity of the product were responsible. 

In this instance Dr. Fishbein's journal was much more prompt 
( the news was out already ) in informing his professional readers 
of a medical calamity than he had been during the long period 
of silence while the Winthrop Sulf athiazole was causing death and 
injury. In this case it was a Sterling patent medicine that was in 
serious trouble, and that kind of stuff could not be advertised in 
the Journal, even under Dr. Fishbein's elastic code. 

On May 3, 1943, announcements in the press had made public 
the fact that one of the oldest and best known of Sterling's patent 
medicines was in serious trouble. Fletcher's Castoria, that age-old 
remedy, advertised since the dawn of time as, "Babies Cry for It" 
had suddenly been found to make babies cry at it. And adults 
who tried a spoonful of the stuff very promptly lost their dinners. 
It was announced by an official Sterling statement that all out- 
standing Castoria in the United States, estimated at 3,000,000 



TREASON'S PEACE *49 

bottles, was being recalled. Next day, advertisements appeared 
in all leading newspapers announcing that some of the supposedly 
gentle cathartic contained a foreign ingredient which caused nau- 
sea and vomiting, and as consumers could not tell the difference 
between the good and the bad, it was necessary to recover it all. 
Much mystery surrounded the incident; both the company and 
Commissioner Campbell announced that it had not been possible 
to determine the cause of the adulteration or the nature of the 
injurious ingredient. 

Some years before, the label on the Castoria bottles indicated 
that its contents "Recipe of Old Dr. Samuel Fletcher" included 
Rochelle salts (potassium and sodium tartrate), in addition to bi- 
carbonate of soda and various vegetable drugs and flavoring mat- 
ter. However, it was advertised as a "Pure Vegetable Compound" 
for babies and children, and in later years the Rochelle salts were 
not mentioned on the bottle, although it was still labeled and ad- 
vertised as, "Original Chas. H. Fletcher's Castoria/' 

The advertising, especially in the women's magazines, usually 
pictured a series of touching family incidents which ended with 
mother inserting a spoon in her smiling infant's mouth. 

Sterling, with a blaze of publicity, proceeded to make a virtue 
of necessity, and the Food and Drug Commissioner joined in with 
a public statement praising that company for having gone to "un- 
usual and very commendable lengths" in calling in the adulterated 
material (Each shipment of which was a criminal violation of 
the law). The Commissioner also stated: 

It is inevitable that instances of this kind will occur even 
in the best regulated plants. 

If Mr. Campbell is correct about this, then it is no longer safe 
to take any medical preparation without testing it first. However, 
I can assure the former Food and Drug Commissioner, and so 
can a great many others, that his statement was untrue; because 
it is a complete and utter impossibility for an incident of this 
kind to occur in a "best regulated plant." If proper tests are made 
to check each step in the compounding of the product, such a de- 
fect would be detected before the product was bottled. And if 
sufficient controls are instituted on the finished product, it surely 



250 TREASON'S PEACE 

would be detected before shipment. No properly managed chem- 
ical plant or pharmaceutical plant is operated without both of 
these types of tests. 

Mr. Campbell, in issuing this apology for Sterling, evidently 
forgot his comment on the adulterated Sulfathiazole when he 
finally admitted that his belated investigation of the Sterling- 
Winthrop plant disclosed sufficient evidence of inadequacy of 
controls in the process by which the Sulfathiazole was manufac- 
tured, to warrant revocation of the Winthrop license to manufac- 
ture this product. 

In excusing Sterling's Castoria offense as unavoidable, Mr. 
Campbell also appears to have forgotten the criminal prosecution 
which he caused to be instituted in 1940 against a chemical com- 
pany for shipping tartar emetic, a poisonous substance, which a 
shipping clerk had labeled by mistake, "Tartaric Acid U. S. P.," 
a nonpoisonous substance. The distinction which Mr. Campbell 
appears to have made between the misbranded tartar emetic and 
the adulterated Castoria with error the defense in each instance 
indicated either an undue harshness in the one case or a strange 
gentleness, toward Sterling, in the other. 

Mr. Campbell likewise must have forgotten that in 1941 he 
caused another brand of Castoria (Pitcher's) to be condemned 
in court for misbranding because the label created a false "im- 
pression" and the "active ingredients" were not properly listed. 

However, this is somewhat aside from the story. More than 
a year before the discovery of the contaminated Castoria, Sterling 
had announced what it was pleased to call a national defense drive 
in Latin America, the purpose of which seems to have been to 
bring the war to a victorious conclusion by means of hair tonics 
and bellyache cures. Unhappily, though, it was our allies who got 
the nostrums instead of our enemies. Of which more later. 

Because Castoria was sold extensively throughout Latin Amer- 
ica, and because the blaze of publicity about recalling all Castoria 
made no mention of what had been exported, I determined to try 
and find out how much of the adulterated product had been in- 
flicted upon our good neighbors to the south. 

The replies from Government departments which might be sup- 
posed to have such information, State, Treasury, and Board of 



TREASON'S PEACE 251 

Economic Warfare, were polite but highly uninformative. One 
paragraph, however, in a letter from the Coordinator of Inter- 
American Affairs, bears quoting: 

I am informed that a complete investigation has been 
made in connection with Fletcher's Castoria that has been 
exported to the other American republics. This investigation 
proved that none of the exported Castoria contained the un- 
fortunate toxic ingredient. 

Thank you for calling this to our attention. 
Sincerely, 
Harry W. Frantz 
Acting Director 
Press Division. 

My reply was, in part, as follows : 

Statements issued by the Sterling Executives, and by 
Food and Drug Commissioner Walter G. Campbell, are to 
the effect that it had not been possible to determine the iden- 
tity of the toxic ingredient in the Castoria which caused the 
trouble. Obviously if they have not been able to identify the 
ingredient which was added to the Castoria by some one 
then it is impossible for anyone to say that none of the ex- 
ported product contained this toxic ingredient. Either they 
know what it is and how it got there, or they don't know 
anything. 

One of the Sterling Company's statements also said 

"It is necessary to recover all Fletchers Castoria outstanding." 
"All" means everywhere. 

If you will be so kind as to advise me promptly of the 
identity of the individual who made the statement to you 
which your letter referred to, I am inclined to believe that 
I can be of further assistance to you in this fantastic affair. 

And then, while waiting for further word from Mr. Frantz, the 
great mystery of the nauseous nostrum was abruptly solved. For 
seven weeks, according to the official Sterling statement, twenty 
Castoria chemists had worked on the strange case of the cathartic 
that had suddenly become an emetic, and at last had made known 



25* TREASON'S PEACE 

their findings it was sugar and water. Under war-time conditions, 
the sugar content had been reduced, and the water; well, it 
seems that, "a chemical change harmless in itself occurred in 
the characteristics of the water used in making Castoria," and that 
this change, "in combination with the reduced sugar, increased 
the degree and rate of normal fermentation/' And that was that. 

Sterling announced that in future their Castoria carton would 
state that the product was "Laboratory Controlled" and would 
have a green band around it. The old carton stated that it was 
"Chemically Controlled/' It had a yellow band around it. Great 
is science! 

In theory, at least, all of Sterling's Latin American advertising 
had been subject to scrutiny and approval of Government officials. 
And in this connection it is of interest that among the Sterling 
documents which the Senate Patents Committee had available, 
and which presumably the Justice Department staff had access 
to in 1941, when the Sterling investigation was stopped, were a 
number which revealed that the sales agencies of the Farben- 
Sterling partnership in South America used the blackjacking tech- 
nic of withholding advertising from newspapers which refused 
to be friendly to the Nazi cause. 

Max Wojahn, head of Sterling's Bayer Export Department prior 
to the alleged house-cleaning, was a brother of one Kurt Wojahn, 
of Farben's South American staff, (as mentioned in Chapter v). 
In January 1938 Kurt Wojahn was informed by Farben that one 
of the Argentine newspapers, La Razon, which was friendly to 
the Nazis, was not getting its share of the Sterling advertising, 
and that an anti-German paper, "Critica," was getting much ad- 
vertising. So Farben demanded of Sterling that this situation be 
corrected at once, saying: 

for us Germans it is intolerable that this newspaper 

should be aided by being given such important advertising 
orders, while the pro-German newspapers either gets no 
orders or very modest ones. 

Max Wojahn, according to these records, replied to this Farben 
complaint by stating that: 



TREASON'S PEACE 855 

Naturally, we are quite inclined, everything else being 
equal, to give preferences in our advertising schedules to 
newspapers which are fair minded in their editorial policy. 

The exhibits bearing upon the cooperative blackjacking of 
Latin American newspapers for propaganda purposes, included 
the report of a conference between Farben and Sterling officials 
at which Mr. Weiss is recorded as undertaking to issue whatever 
instruction might be necessary so that proper attention would be 
given to requests made by the German Government concerning 
Kurt Wojahn as conveyed to Weiss by Farben's Counsel General, 
Mann. It was team work all right Hitler to Farben to Weiss to 
McClintock to Wojahn and smack went a blackjack on the pock- 
etbook of an Anti-Nazi newspaper. Shall we believe that none 
of these smacks are ever directed at pocketbooks nearer home? 



CHAPTER XIII 



Good Neighbors, and Bad 



GEHEIMRAT SCHMITZ, 

Director von Schnitzler and Professor Herlein, who send their 
best regards to Mr. Diebold and you, are very happy over 
the valuable support and assistance that you have extended 
to us. 

With this expression of gratitude Dr. William E. Weiss, of 
Sterling received the thanks of Farben's top leaders for defeating 
the British blockade by supplying Sterling-made drugs to Farben's 
outlets in Latin America where they could be sold as German 
products. 

The letter was written to Dr. Weiss by Dr. Wilhelm R. Mann, 
the Farben director in charge of Bayer, on February 8, 1940, in 
Florence, Italy, after an extended conference with Earl McClin- 
tock, head of Sterling's Latin American affairs, who had gone to 
Italy to meet the Farben leaders to make a deal which would 
protect their joint business dealings from injury by the war, and 
from certain seizure as soon as the United States should enter it. 

Other excerpts from these Farben war-time greetings to Ster- 
ling's Fuehrer are as follows: 
254 



TREASON'S PEACE 255 

Our conferences were held in the spirit of trust and friend- 
ship that you, dear Dr. Weiss, strove in such an understand- 
ing manner to create already in times of peace 

Your and our power will lead us to a solution which will not 
mean relinquishing our pre-war position. 
I view the future with calm, confidence and trust, which 
will be influenced by you and our work, by our experience, 

by the strength of the knowledge of our collaboration 

we are living today only to fulfill our duty to serve our Father- 
land. 

Mac (McClintock) will tell you the rest; he was, and is, a 
splendid interpreter of your thoughts and wishes, but also 

a true friend of our common interests 

May the time soon come when we can emerge from the 

darkness of these months into the light, and continue our 

activities! 

Dear Dr. Weiss, my revered friend, I clasp your hand! In 

true and devoted friendship. 

Always yours, 

Wilh. R. Mann. 

Several years previously when America was still being lulled 
to sleep by assurances that we could deal profitably with Hitler, 
and that war was an impossibility, Sterling's management had 
begun conferences with Farben's leaders about the dangers to 
their Latin American partnership that would arise when war be- 
gan. In 1938, McClintock went to Europe to ask Farben to sign 
a document in blank by which, if need be, a transfer to Sterling of 
the Latin American inventories and machinery could be recorded. 
Negotiations continued at conferences in Europe and in New York, 
but when the war began the assets of Sterling and Farben were 
still hopelessly scrambled in various Latin American countries. 
Sterling's requests for a blanket assignment were refused, and 
Farben countered with proposals that new outlets be formed 
which ostensibly would be owned by Sterling but actually would 
be operated by Farben agents. 

The most active and influential of the Farben pre-war agencies 
in Latin America were those which handled Bayer aspirin and 



256 TREASON'S PEACE 

similar drugs; where, as in the United States, with customers in 
every hamlet, and advertising before every eye, they created a 
huge machine, and an effective screen, for espionage x and propa- 
ganda. 

So, when the British blockade cut off Farben's exports to Latin 
America late in 1939, Sterling rushed into the breach and began 
shipping quantities of aspirin, Winthrop specialties and other 
drugs, in bulk, or in cartons and packages which closely resembled 
Farben's. The Farben agents frequently were not required to pay 
Sterling for this merchandise. When it was sold, the proceeds were 
retained for Gestapo purposes. 

Late in 1940 it became evident that the situation might lead 
to trouble because of Sterling's too direct dealing with German 
agents. So what appeared to be an entirely new set of branch 
houses, owned and operated exclusively by Sterling, was organ- 
ized. The plan was to continue taking care of the Latin American 
business in Bayer aspirin and other Farben-Sterling prepara- 
tions under cover of these new houses. 

These Sterling storm cellars, known as Farma companies, 
were actually erected in seven Latin American countries during 
the first half of 1941, some of them after President Roosevelt's 
freezing orders of June 18, 1941, which tied up all German assets 
in this country. This order of course covered all such partnership 
arrangements as Sterling had with Farben. This was also the 
period of the Justice Department dragnet investigation into the 
relations of Sterling's executives with Farben (referred to in 
Chapter IX) which was halted by Attorney General Biddle. 

Even up to the last moment, William E. Weiss apparently never 
gave up hope of inducing Farben to turn over the Latin American 
aspirin business (worth a million a year in profits) to Sterling, 
for the duration, on some basis that might block action by the 
United States Government. On August 14th the day before Ster- 
ling submitted its proposals to the Government to break its al- 
ready outlawed agreements with Farben, Weiss sent a long cable 
begging his Frankfurt friends to consent. The Farben directorate 
replied tersely insisting on fulfillment of their partnership agree- 
ments. 

The extent of the assistance which Sterling's executives had 



TREASON'S PEACE 257 

rendered Farben's agents, and were still arranging to give when 
threats of criminal indictments became a reality, was indicated 
in later statements that, subsequent to the consent degrees, the 
company destroyed more than 100,000,000 pieces of advertising 
and packaging prepared for its Farben Latin American brigade. 
The material destroyed carried Farben's trademarks such as Cafi- 
aspirina, Bayer Aspirina, Instantina and Tonico Bayer, at a cost 
for printed matter alone of $100,000. 

The total cost of Sterling's alleged housecleaning, including 
repackaging of huge stocks bearing Farben's trademarks, closing 
all of the old offices, and liquidating all of its branch tie-ups with 
Farben, and its 1941 Farma branches, was in excess of $450,000, 
according to a statement which Sterling's new Chairman E. S. 
Rogers, filed on February 10^1942, with the Interdepartmental 
Committee of the Government. This was to prove that the face 
lifting operation on Sterling was not a mere relabeling, but a 
true reform and rebirth of Americanism. 

Sterling and Farben had disposed of over a quarter million 
pounds of aspirin in Latin America in 1938, enough to produce 
over 300,000,000 five-grain tablets. But it also takes a tremendous 
number of Bayer Aspirin tablets to make a $100,000 bill for new 
cartons and circulars. 

A vivid indictment of Sterling's part in the Farben-Nazi activi- 
ties in Latin America was pronounced by former Assistant At- 
torney General Norman M. Littell after he was removed from office 
in December 1944, because of differences with Attorney General 
Francis Biddle on the Corcoran affair. 

Mr. Littell's accusations, as they appeared in the Congressional 
Record were in part: 

In many cases the funds of this business were diverted from 
the German agents to spread German propaganda. Payments 
were made to I.G. Farben's agents in South America and 
supplies were sent to German agents in South America. The 
German Bayer Co. in Rio de Janeiro was accused of divert- 
ing funds to the German embassy; and Renata Kohler, head 
of the German Bayer Co. was accused in Brazil of being a 
Nazi Agent. A new branch of the Bayer Co. of New York 



258 TREASON'S PEACE 

was organized in Venezuela in March 1941 and a German 
citizen was made the head of that branch. Many of the agents 
in South American countries were exposed as Gestapo agents, 
as abundant records in the State and the Department of 
Justice will show 

every avenue of trade penetration was used for political 

propaganda, collection of strategic information about foreign 
countries, and efforts to suppress the development of strategic 
industries in areas which might be hostile to Germany. As 
an example, in 1934, I.G. Farbenindustrie and Sterling Prod- 
ucts agreed to use their advertising as a political weapon and 
decided that notoriously anti-German newspapers should not 
receive any advertisements for Cafiaspirina or other products 
showing the Bayer cross 

These actions were carried out under the direction of Wil- 
liam E. Weiss, President; Earl I. McClintock; A. H. Diebold, 
and other personnel, some of whom owed their positions to 
I.G. Farbenindustrie, which had sent them to this country. 

A few months later, in June 1945, Assistant Secretary of State 
William L. Clayton brought out some of the State Departments 
secrets when he testified before Senator Kilgore's Sub-Committee 
about the Farben "safe havens" in foreign countries; where, he 
said, the facilities for another war were being hidden. 

Among other exhibits which the Assistant Secretary introduced 
were several reports made to Farben by its Latin American agents 
as late in the war as July 1943. These contained references to the 
activities of the Farben sister firms in various South American 
countries, and the ease with which drug supplies were still made 
available to Farben's agents in certain countries, until things tight- 
ened up. Mr. Clayton then identified the sister firms as Farben's 
cartel associates, or former associates, in the United States. 

And in the State Departments' famous Anti-Peron Blue Book 
issued in February 1946, stress was laid on the part played by 
Farben's Quimica Bayer and Anilinas Alemanas in furnishing fi- 
nancial support to the pro-Nazis of the Argentine, and in assisting 
in building up secret intelligence service on the political, social and 
economic life of the country. 



TREASON'S PEACE 259 

Let it be stated that Sterling was not the only Farben affiliate in 
the United States which "helped out" Farben's Latin American 
agents after Winston Churchill locked them inside a ring of float- 
ing steel. 

There was the old established dye stuff jobbing firm of Fezandie 
& Sperrle which took over, as a blind, the export of General Aniline 
dyes to Farben agents who were on the British and American 
blacklists; also Rohm & Haas as mentioned in Chapter IV, began 
taking care of the blockaded South American agents and promised 
faithfully to give them back to Farben when the war ended. Ad- 
vance Solvents & Chemical Co., of New York, another Farben 
affiliate, joined in this war emergency relief of Farben's customers. 
And Standard Oil of New Jersey, faithful unto death, also con- 
tinued to supply gasoline through its South American sales branch 
to Nazi airlines operating across the South Atlantic. 

It is interesting to note that in arranging for General Aniline 
to take over Farben's South American business in the last months 
of 1939 after the war began, two executives who handled the mat- 
ter were our old acquaintances E. K. Halbach, president of Gen- 
eral Dyestuff, and Rudolph Hutz, vice-president of General Ani- 
line. 

It may be recalled that Halbach and Hutz were officials of the 
Badische and Bayer American fronts during the first World War, 
so they already knew just what to do and how to do it. 

A Farben sub-manager in the Argentine, named Alfredo Moll 
made the arrangements for blinds or dummy houses there through 
which Fezandie & Sperrle, a New York Farben ally, shipped Gen- 
eral Aniline dyes which ultimately reached Farben agents. It 
was a game of double dummy one at each end and Farben took 
all the tricks. 

In November 1941, some one in General Aniline attempted to 
have Moll, who worked with Halbach, approved by the Treasury 
and State Departments as the company's representative in the 
Argentine. This was after Judge Mack had become president of 
General Aniline and Homer Cummings was its attorney. Every 
known Farben agency in Latin America was at that time on the 
State Department's official blacklist. Moll, who was well connected 
in the Argentine, is reported to have sold out his interest in Ani- 



260 TREASON'S PEACE 

linas Alemanas, the Farben dyestuff subsidiary, and retired as 
its manager just before the company was blacklisted. As the Treas- 
ury agents caught up with the identity of the various dummy 
fronts set up by Moll for Fezandie & Sperrle, Moll would then 
arrange new ones. Finally some of the Treasury rough-neck squad 
cracked down and put Fezandie & Sperrle out of business. But 
Alfredo Moll retained his standing, or his stand-in, with the State 
Department which, with characteristic blindness apparently con- 
tinued not to disapprove of Farben's ex-manager. 

Meanwhile the office of the Alien Property Custodian, after tak- 
ing over General Aniline in 1942, is reported to have permitted 
Moll to act as its sales agent in the Argentine. In midsummer of 
1943, Mr. Moll still had friends in high places; according to an 
official of the Alien Property Custodian's office it was not neces- 
sary to blacklist everyone just because he had dealings with 
Farben. 

In supplying gasoline to the Fascist South American Lati and 
Condor Air Lines, Standard Oil alleged compulsion to do so under 
the terms of a binding contract, but according to one government 
official in testifying before the Truman Committee in April 1942, 
no such contract existed. 

When, in October 1941, Standard Oil refused to comply with 
the State Department's request to desist, Assistant Secretary of 
State, A. A. Berle, Jr., announced that steps might be taken to 
put Standard's Brazil subsidiary on the blacklist. Mr. Berle, of 
sterner stuff than some of his colleagues, used the diplomatic "per- 
haps" but obviously meant "no." Blacklisting would have been 
a solar plexus smack on Standard's protestations of patriotism; 
still worse, it would have prevented Standard from supplying any- 
thing to its Brazil subsidiary, either for Nazi planes or for any 
other customers. The objectionable deliveries of gasoline ceased 
forthwith: call it voluntary compliance or shotgun diplomacy, 
and divorce for cause. 

According to other testimony before the Truman Committee 
in April 1942 by William La Varre, South American expert of the 
Commerce Department, the two Farben affiliates, Standard Oil 
and Sterling, were among the few American corporations that did . 



TREASON'S PEACE 261 

not fully cooperate with Government agencies in eliminating Nazi 
agents in their operations in Latin America. 

Late in November 1941, on the eve of Pearl Harbor, Attorney 
General Biddle described to a Congressional committee a manual 
of instructions for German spies which contained propaganda and 
espionage directions for both North and South America. 

Significantly Mr. Biddle added that the Nazi organization in 
the United States worked ostensibly without a chief; through in- 
dividuals who might not even know of the existence of other oper- 
ators. 

A few days later, on December 5, 1941, in a public address, 
Mr. Biddle protested the immense amount of propaganda coming 
into this country, some of it intended for distribution in Latin 
America, and demanded identification of "its source and financial 
backing so that the public shall know and judge." 

Official identification of the companies and individuals thus 
accused or suspected of propaganda and other subversive activi- 
ties in the United States and Latin America, did not emerge. 
Rather did they tend to submerge under an unfortunate policy 
of inaction. 

However some of the evidence which persistent inquiry made 
available is revealing so it is now possible to comply with Mr. 
Biddle's request of December 5, 1941, "so that the public shall 
know and judge." 

For example, in one of the frank protests by the British Minister 
of Economic Warfare in May 1941 he named William E. Weiss, 
and Earl I. McClintock, of Sterling, and described the activities 
directed by these gentlemen in South America as: 

Financial assistance (which) they have heretofore felt obliged 
to render to a country which is now unblushingly engaged in 
trying to make both hemispheres unsafe for democracy. 

So, too, the press statement credited to Assistant Attorney Gen- 
eral Thurman Arnold on September 25, 1941, relative to the Ster- 
ling consent decrees, contributed a ray of light on the subject with 
the comment about German control of drug outlets in South 
America: as "one of the most effective instruments of propaganda 
and German influence in this hemisphere." 



262 TREASON'S PEACE 

When this 1941 statement was issued, Mr. Arnold had before 
him certain evidence pertaining to the subject which, on Mr. 
Corcoran's instructions, Mr. Arnold was not permitted to present 
to the Grand Jury. Lack of space makes it impossible to do more 
than outline such material here. It is voluminous. 

The Treasury report, already referred to, which was originally 
prepared for an Inter- American Conference to discuss Latin Amer- 
ican problems in June 1942, indicated the official conclusion that 
the "personal fealty" or "close personal relationships" of individu- 
als involved in the I.G. Farben business tie-ups had aided the latter : 

To finance propaganda, sabotage, and other subversive ac- 
tivities in the United States and other areas (Latin America) 
of strategic importance to this country 

As an example let us examine the 1933 message sent to Max 
Wojahn, the Sterling-Bayer manager of its exports to South Amer- 
ica from the Farben Board of Directors, dated March 29, in which 
employes of Farben in foreign countries were told to hold their 
noses and refrain from objecting to the indecencies practiced by 
the New Order in Germany, and 

immediately upon receipt of this letter to contribute 

to the spread of information as to the actual facts in a manner 

in which you consider best adapted to the conditions 

in your country and to the editors of influential papers, or by 
circulars to physicians and customers; and particularly to 
stress that part of our letter which states that in all the lying 
tales of horror that is not one word of truth ( italics underlined 
in original document). 

Instructions of this character came to the Sterling organization 
in Latin American companies in accordance with the original 
agreements with Farben, which provided that German Bayer, or 
I.G. Dyes, should suprvise and share various expenses, including 
Latin American advertising and propaganda. Out of that begin- 
ning had come mutual ownership by Farben and Sterling of a 
lengthy string of branch houses and sub-agencies in Latin Amer- 
ica, also other agencies owned solely by Sterling or Farben. 

The stake for which Farben played in Latin America, assisted 



TREASON'S PEACE 263 

by its tie-ups with huge corporate entities in the States, was the 
ultimate control of both continents. And, unbelievable as they 
may appear, there are proofs that Farben affiliates in the United 
States, directed by native-born American citizens, actually took 
care of a large share of Farben's expense for these subversive ac- 
tivities. Let it be read with shame that this continued even after 
the United States by Lend Lease and other actions, had allied 
itself definitely against the Nazis. 

The fact that much of the evidence of how such activities were 
financed by Americans seems to have be.en pigeonholed in the 
files of the State, Justice, Treasury and Commerce Departments, 
may appear to be as bad, or worse, than the treachery thus immu- 
nized. 

In Colombia, the country nearest to the defenses of Panama, 
Farben branches had as advisers with excuse for frequent visits 
two distinguished "American" citizens who were closest to the 
top Farben leaders Deitrich Schmitz, as director of Colombia's 
Anilinas Alemanas; and Walter Duisberg, as "visiting" director of 
Colombia's Quimica Bayer. Both of these ersatz "Americans" made 
frequent business trips to Colombia as the day approached when 
the possible destruction of the Panama Canal might mean the 
destruction of liberty on both continents. 

According to the Treasury report referred to, Farben placed 
assistant business managers in its branches in eight Latin Amer- 
ican countries who knew nothing about the business but were 
there solely for political purposes and for espionage and sabotage. 

While these Farben activities, directed at the security of the 
American continents, were taking place in Latin America, a bar- 
rage of high-class pacificist propaganda was laid down by the 
Farben directed Board of Trade for German- American Commerce. 
This propaganda, circulated in the most influential circles of 
American industry, finance and politics, included such appeals as 
the following excerpts from the German-American Commerce 
Bulletin of March 1941: 

And what about Germany's trade with the Latin American 
countries? Germany has not the slightest intention of de- 
stroying American trade with Latin America. Her trade with 



264 TREASON'S PEACE 

the Spanish American Republics has never and never will 
constitute a threat to the U. S. A Therefore a side-by- 
side rather than a counterplay of German and American inter- 
ests in South America is not only desirable but inevitable. 
In these days when the military conflict is still the immediate 

issue, Germany already thinks in terms of a peace which 

offers unlimited opportunities for the restoration of the old 
as well as the development of many new ways for mutually 
beneficial trade 

Having thus disposed of all menace to the United States by 
appeal to the commercial instincts of American business leaders 
and politicians, the editorial concluded with this tender of ap- 
preciation for the efforts of the Farben cartel partners: 

There is still a sufficient number of influential people in the 
United States who have a realistic understanding of present 
events, and therefore demand that America preserve her in- 
dependence and freedom of action for her own sake. This 
course includes the maintenance of peaceful relations with 
the German people. 

As Farben's Dr. Mann wrote to Sterling's influential Dr. Weiss 
in the letter cited at the start of this Chapter: I view the future 

with confidence influenced by the knowledge of our 

collaboration. 

The high talent of Sterling during the 1940-41 period of pinch- 
hitting for Farben in Latin America, among others included 
David Corcoran (brother of Thomas) in charge of the Sidney 
Ross Company, export subsidiary with its numerous Latin Amer- 
ican branches which prior to that time had been distributing only 
such Sterling patent medicines as Fletcher's Castoria, Phillips' 
Milk of Magnesia, and Cascarets; in which Farben presumably 
had no direct interest. 

Weiss (who died in 1942) and Diebold, both were forced off 
the Sterling Board in December 1941, as result of the agreement 
on which the consent decrees were based. Of the others involved 
in guiding Sterling during the period of continued cooperation 
with Farben in Latin America, and in the United States, Messrs. 



TREASON'S PEACE 265 

Roger*, McClintock, James Hill, Jr., G. S. Hills and George C. 
Haigh continued in the saddle. 

In December 1941 shortly after Pearl Harbor, Sterling blithely 
announced in the press that it was beginning an economic war 
against German domination of Central and South America with 
the purpose of strengthening American defense efforts throughout 
all parts of the Western Hemisphere. 

This economic war was inaugurated in Mexico City with large 
scale advertising by press and radio and a parade of pretty Seriori- 
tas handing out samples of Sterling's Bayer Aspirin which had 
been renamed Majoral in Latin America; and a procession of 
trucks carrying enlarged photographs of Sterling Radio stars 
heard on Mexican broadcasting stations. 

In addition to Majoral the Mexican campaign included other 
Sterling trademarked remedies such as Phillips' Milk of Magnesia, 
Ross Pills, Adams Tablets, Glostora and Fletcher's Castoria. 

As this "national defense" drive to push Sterling's widely adver- 
tised preparations in the Southern Hemisphere got under way, 
the methods of the old time pitch artists were revived and refined, 
with the use of sound trucks, free moving pictures, and, in one 
instance a modernized show boat which chugged its way up to 
river towns in the Republic of Colombia the advertising of patent 
medicines being blended in with moving pictures and messages on 
the blessings of hemispheric solidarity. 

Another novelty in the sale of such products was introduced by 
Sterling's when "bullboards" were used instead of "billboards" as 
outdoor advertising of its product Majoral, the name being 
painted on the sides of the bulls that went to their doom in view 
of shouting thousands in Latin American bullfight arenas. 

And in Mexico City it was reported that a parrot was being 
trained to shout Majoral, but either the word or the remedy was 
too much for the bird, or perhaps it was not a pro-Farben mem- 
ber of the feathered family, as this psychological warfare stunt 
failed to materialize. 

According to reports, more than 10,000,000 free samples of 
Majoral were given away and more than one million dollars was 
expended during the first twelve months in advertising this new 
aspirin trademark in the press while another million was spent 



266 TREASON'S PEACE 

advertising other Sterling preparations; along with several hun- 
dred radio shows from Latin America's leading broadcasting sta- 
tions. The fleet of autos and trucks equipped with sound equip- 
ment and motion picture projectors for propaganda concerts and 
shows increased to nearly two hundred and the Majoral drive 
was proclaimed as the biggest American promotional job ever 
undertaken in Latin American history. 

As one of the conditions, or Sterling promises, which led up 
to the Sterling consent decrees in 1941, all employes of Sterling 
in the United States and in South America were carefully scru- 
tinized, and supposedly those with pro-Nazi affiliations were re- 
moved. That some were discharged, and a few in the United 
States interned, has been stated, but the list has always been 
an official and a Sterling secret. 

However, an unfortunate incident occurred in 1943, when the 
F.B.I, arrested a Spanish Count named Cassina at the export 
offices of Sterling in Newark, New Jersey, where he was being 
trained to become a field agent in Brazil. The company stating that 
this man had been employed in good faith by Sterling on the 
basis of high recommendations. On December 20, 1943, Cassina 
pleaded guilty to a charge of failing to register with the State 
Department as an agent of the Nazi Government, and was sen- 
tenced to a term in jail to be followed by deportation. He had 
been sent to America in November 1940 by Gestapo agents who 
expected him to furnish information to Germany through letters 
to his father in Spain. 

An example of the official attitude of the State an.d Treasury 
Departments and the Board of Economic Warfare was a refusal 
by those agencies to comment in writing on two peculiar radio 
broadcasts delivered by Earl I. McClintock, over Station WMCA 
in June and July 1942. In these radio addresses the former financial 
aid of the Democratic National Committee told his listeners that 
he had just returned from South America, then explained at some 
length why a certain well-informed Chilean believed that his 
country should not declare war on the Axis. 

These broadcasts were delivered at a time when the United 
States Government was making desperate efforts to induce both 
Chile and the Argentine to join the other American nations by 



TREASON'S PEACE 267 

breaking with the Axis. Such remarks made so publicly by a man 
reputed to have high official connections caused much indignant 
comment in Washington, especially among members of the staffs 
of those agencies engaged in promoting friendly relations with 
our neighbors to the South. 

So, in a visit to the State Department, I asked several questions 
of one member of the staff who appeared to be informed: 

"Did the State Department know that McClintock intended 
to make those remarks about Chile?" "No," was the reply. 

"Did the State Department approve of them after they 
were delivered?" "No," was the reply. 

"What did the State Department do about it?" "We told 
McClintock we did not approve of it," was the reply. 

"What else did the State Department do about it?" "Noth- 
ing," was the reply. 

Mr. McClintock, vice-president and director of Sterling, subject 
to the continued approval by the United States Government, con- 
tinued to hold his job. And Edward J. Noble, former director of 
Drug, Inc., who had made that broadcasting possible, recently 
had purchased station WMCA (with the reputed assistance of 
Tommy Corcoran ) ; also subject to the approval of a Government 
agency, the Federal Communications Commission, the very Com- 
mission which for several years had declined ah 1 suggestions that 
Farben's influence over broadcasting chains required investigation 
and action. 

Attorney General Biddle was heard later to complain to Congress 
that he had a headache because that body had not defined more 
accurately the meaning of the word "subversive." Examination of 
the McClintock broadcast and of the conditions existing when it 
was delivered, along with a glance through various statutes relat- 
ing to such matters, might have afforded the Attorney General 
greater relief from his official headache than could a trunkful of 
Sterling's Bayer aspirin. The best cure for headache is to eradicate 
the cause. 

Possibly there is no better illustration of official hush-hush 
policy than the war-time reluctance of the State Department to 
reveal voluminous reports in its possession regarding the activities 



268 TREASON'S PEACE 

of I. G. Farben and the latter's agents in various parts of the world, 
especially those in North and South America. This reluctance to 
mention Farben as a factor in Germany's domestic and foreign 
activities was apparent in the State Department's 1943 Red Book 
on Peace and War which disclosed Germany's step-by-step re- 
arming; and in its 1943 White Book on National Socialism which 
revealed details of the Nazis' domestic and foreign organizations. 
In neither of these publications was the name Farben, or of 
Farben's leaders and allies, even mentioned. The files of the State 
Department, it is reported, tell a different story. 

It may not be fair to refer to our State Department as Sees All, 
Knows All, and Does Nothing, but the unhappy fact remains that 
in the record of Secretary Hull's staff there appeared few if any 
public statements on the subject of Farben. 

However, the State Department did respond with one opinion 
regarding the distribution and advertising of such patent medi- 
cines as Castoria in Latin America. Advertising Castoria in lead- 
ing Latin American papers as the laxative which "is meant for 
children," containing "no substance which harms," good neighbor 
Sterling had been begging the mothers of those babies never to 
make the "serious mistake" of giving their children any laxative 
but Castoria. 

One Bernard Meltzer, State Department Acting Chief of For- 
eign Funds Control, advised that investigation of such matters 
could not be undertaken, and that: 

Neither the (State) Department nor any other agency of 
this Government has taken any measures which may be con- 
strued as approving all activities, including advertising, 

of Sterling Products, Inc. 

Which pronouncement appears to be a somewhat comprehen- 
sive denial of responsibility for matters which related to our war- 
time good-neighbor policy, as well as for one of the conditions 
of the 1941 Sterling consent decrees. 



CHAPTER XIV 



Again, Espionage and Sabotage 



A"... STRUCTURE 

of espionage/' which made "weekly and monthly reports to 
Germany They were soldiers in the army of Germany." 

So said Francis P. Garvan, Alien Property Custodian, in 1919, 
when denouncing certain American agents of I.G. Dyes. 

An instrument so aptly devised for espionage pur- 
poses. Persons were carried on the payroll of the General 
Aniline and Film Corporation who were unknown in the 
company. There was a constant traffic in German agents who 
would be employed by General Aniline and Film Corporation 
for a few months and then moved on to other fields. 

So said Henry Morgenthau, Jr., Secretary of the Treasury, in 
1942, when denouncing certain of the successors of I.G. Dyes ( in- 
cluding some of the same individuals who had been involved in 
Mr. Garvan's charges). 

The part played by Bayer's Schweitzer and other I.G. Dyes 
agents as saboteurs in World War I need not be repeated. Over 
two decades later another Government official, who like Garvan, 

269 



270 TREASON S PEACE 

had spent months digging beneath the surface of the activities of 
the dye trust agents in this country before and during World War 
II made precisely the same charges which Garvan, in his attempts 
to induce senatorial action, had first made years previously. 

This later official indictment of Farben's espionage and saboteurs 
in a Treasury report of investigations made in 1941 and 1942, 
said in part: 

In the twenty-year period between 1919 and 1939 German 
interests succeeded in organizing within the United States 
another industrial and commercial network centered in the 

chemical field It is unnecessary to point out that these 

business enterprises constituted a base of operations to carry 
out Axis plans to control production, to hold markets in this 
Hemisphere, to support fifth column movements, and to mold 

our postwar economy according to Axis plans This 

problem with which we are now faced is more difficult than, 
although somewhat similar to, the problem faced by us in 
1917. The background is vastly different from that which 
existed in 1917. 

The report went on to say that: 

Certain individuals who occupied a dominant place in busi- 
ness enterprises owed all of their success to their business 
contacts in the past with I.G. Farben. 

Also that it was regarded as "naive in the light of Axis practices" 
to believe that Farben relied only upon the services of those who 
were actually citizens of Axis countries. 

This Treasury report, in discussing the Farben practice of 
sending spies and agents to become citizens of this country (see 
Chapter v) stated that it had been found necessary to dismiss 
one hundred American citizens from General Aniline and Film 
Corp., including five key executives, three of whom received 
salaries in excess of $50,000 a year; also that it had been neces- 
sary to liquidate the General Aniline patent law firm, composed 
of W. H. Hutz, son of the only original Bayer's Rudolph Hutz 
(bobbing up again), and another attorney named H. M. Joslin. 



TREASON'S PEACE 271 

The Secretary of the Treasury, according to the report, had 
the power to define as a national of Germany any person deter- 
mined to have acted directly or indirectly for the benefit of, or 
under the direction of, Germany. To the reader of this story it 
may appear that this power has not been utilized as fully as 
might be. 

The report described how the payroll of this American front 
for the German dye trust in World War II, as in World War I, 
was being utilized by Farben's spy bureaus. Under these condi- 
tions any past connection with Farben by a General Aniline em- 
ploye appeared to be considered, by the Treasury, as cause jfor 
immediate dismissal. 

Among the pre-war activities of the Agf a-Ansco Division of Gen- 
eral Aniline & Film are reported (by others, not this Treasury 
document) to have been demonstrations of its photographic and 
blueprint apparatus and materials, conducted ostensibly for the 
edification of our army and navy authorities. It is said that these 
tests included the taking of stills and moving pictures, and the 
reproduction of drawings and documents, of what may have been 
regarded as "top secrets" of the limited national defense prepara- 
tions which were permitted by a stupid Congress prior to the out- 
break of combat war in Europe. 

Complacent Government officials who permitted these generous 
tokens of Agfa-Ansco patriotism may have felt suitably compen- 
sated with copies of the films and photoprints thus supplied, gratis, 
for their use. And we may safely assume that Max Ilgner, in Berlin, 
was also gratified to see such movies and pictures of American 
defense plans as may have reached him through these channels. 

When it came to weeding out the undesirables in Sterling the 
Treasury firing squad was unable to apply its formula and the 
report states that the removal of some forty-two persons on the 
payroll (for relations with Farben) was merely suggested. The 
suggestion evidently went to the Justice Department and Mr. 
Corcoran. 

If it may appear difficult to understand why such discrimination 
would be tolerated it should be understood that the German dye 
trust had immeasurably improved its technic over that employed 



27* TREASON'S PEACE 

in World War I both in espionage and sabotage, and for the pro- 
tection of the more important of its agents. This was especially 
true in the case of Sterling's Bayer. 

During the months following Pearl Harbor, when the attempted 
housecleaning of the Sterling-Bay er-Winthrop organization at 
Rensselaer, New York, got under way, considerable excitement 
prevailed in that town and at Albany, across the Hudson River, 
where many of the personnel of the Sterling companies resided. 

The head of a beauty parlor which was patronized by ladies 
of the Winthrop-Bayer families was reputedly put on the F.B.I, 
payroll, and feared for her life while thus serving her country 
in checking on subversive utterances of some of the lovely patrons 
whose husbands' loyalty to this country was under observation. 

One of the Winthrop scientific staff who was removed from 
his duties and locked up on Ellis Island was Wolfgang Schnell- 
bach, mentioned in Chapter v, who, it developed, had charge of 
"testing" the 400,000 adulterated Sulfathiazole tablets shipped out 
in 1940 which caused so much death and injury before the Win- 
throp management warned the public of this danger. 

At Ellis Island, Mr. Schnellbach protested vehemently that the 
catastrophe was not his fault that his superiors refused to permit 
him to make proper tests on the tablets. 

Months before the United States entered the war in December 
1941, there was available to the Congress testimony direct from 
the Gestapo relating to Farben's espionage and sabotage activi- 
ties in this country and Latin America. This information was 
publicly presented to the Dies Committee on un-American Activi- 
ties in May 1941 by the celebrated Richard Krebs, who wrote "Out 
of the Night," under the pen name of Jan Valtin. 

Mr. Krebs, as a former Gestapo agent, testified at length from 
personal knowledge regarding the part played by the German 
dye trust in the organization of Nazi propaganda, espionage and 
sabotage in this hemisphere. 

Naming Hamburg-American Line offices, and the Zapp Trans- 
ocean News Service as mere appendages of the Gestapo, Krebs 
told how business houses in the United States employed Gestapo 
agents themselves and also placed these agents in other concerns 
which were not pro-German. The Gestapo, said Krebs, had its 



TREASON'S PEACE 273 

"Industrial Reports Department" with special schools for train- 
ing Germans, or Americans of German origin, to go to America 
as mechanics, engineers, and draftsmen, also as newspaper men 
and teachers for work in vital industrial and cultural establish- 
ments of North and South America. 

According to the witness, the Gestapo regarded any country 
where it operated as a "hostile country" with which "war" began 
the moment one of its agents crossed the border. (The country 
would learn in good time that "war" was going on. ) In addition 
to inducing propaganda which might retain a semblance of 
legality, the purpose of the Gestapo, and especially of its Farben 
spies, was revealed by Mr. Krebs to be: 

to obtain information about our security (defense) 

program, and to produce choke points, or to sabotage our 
war efforts." (We may recall that Francis Garvan had said 
the same thing in 1919, and that Henry Morgenthau repeated 
it in 1942.) 

Mr. Krebs was specific when he stated: 

The I.G. Farbenindustrie, I know from personal experience, 
was already in 1934 completely in the hands of the Gestapo. 
They went so far as to have their own Gestapo prison on the 

factory grounds of their large works at Leuna, and 

began, particularly after Hitler's ascent to power, to branch 

out in the foreign field through subsidiary factories It 

is the greatest poison gas industry in the world, concentrated 
under the title of I.G. Farbenindustrie 

During World War II there may have been fewer instances 
than in World War I of destruction of ships and munition plants 
by explosive bombs but the new technic did largely delay, and in 
some instances may have prevented, building the ships and the 
plants. 

Possibly readers may perceive little difference in results be- 
tween the "sabotage" that destroys, with bombs, a munition plant, 
after it is built; and the "sabotage" that prevents, by what Harry 
Truman called treason, the utilization of an improved process or 
the building of a new munition plant. 



274 TREASON'S PEACE 

In August 1942 during the closing days of the Bone Committee 
hearings the word "sabotage" rang out in the Committee room 
while Standard Oil's Frank Howard was attempting to explain 
why a Farben-Standard patent restricting tie-up forbade Standard 
from using an advantageous process for making synthetic nitrogen 
and ammonia. 

Irritated at cross-examination of the committee counsel, which 
brought out an admission that Standard did not appeal to the 
United States Government to do something about the matter until 
August 1941, Mr. Howard exclaimed: 

The sabotage you speak of, Mr. Fath, was simply a blanket 
refusal on the part of the German Government to do any 

business at all in America You are arguing that we 

should have disregarded the limitations that existed on 

our rights. I might tell you that if we felt it was necessary, 
and important in the national defense, we certainly would 
have done it; but at the moment we apparently did not think 
it was necessary to do anything different from what we had. 

As indicative of the significance of the use of the word "sabotage" 
in that connection it may be pointed out that when Mr. Howard 
gave this testimony the "limitations" on Standard's rights had al- 
ready been adjudicated as criminal violations of our laws; and 
the "moments" when Standard did not find it necessary to act 
extended until August 1941, within a few short months of our 
entrance in combat war, the importance to our national defense 
being that synthetic nitrogen was vital in our production of mili- 
tary explosives. 

Just as this kind of "sabotage" went on before and during the 
war, it may also occur to readers of this chapter that in some 
of the law enforcement problems to be mentioned later another 
type of "sabotage" of government may be observed. 

Another incident of the Standard-Farben partnership which 
should properly be classified as "sabotage" had to do with that 
other vital military need, toluol. Back in 1920 appeal was made by 
the United States Navy authorities to the Senate that we should 
not again be caught short of toluol for TNT as we had been in 
World War I. But the Senate, and every one else in authority, 



TREASON'S PEACE 375 

apparently forgot that warning; so we were again short of this all- 
important military requirement because, among other reasons, 
of restriction imposed by Farben upon the use of a new process 
for producing synthetic toluol which was developed by Standard 
from the germ of one of the Farben patents on the hydrogenation 
of oil. Although the process was developed long before the war, 
Standard's Frank Howard appeared to believe that even after the 
war began Farben still controlled its use because it did not 
relate directly to the oib industry. So Standard, in May 1940, 
turned down requests for the synthetic toluol which the Trojan 
Powder Co., required for a War Department contract. 

Large scale production of this product was delayed by Standard 
out of deference to Farben until 1941, long after the need for 
immense quantities of synthetic toluol had become pressing. In 
World War I toluol was needed mainly for TNT. In World War II 
its use for TNT was tremendously increased because of the larger 
use of military explosives, and also because of further enormous 
requirements of toluol for production of butadiene, an essential 
infredient for synthetic rubber, and for high-test aviation gasoline. 

But Standard feared that Farben might object to the use of this 
process and sue for damages after Farben had won the war. 

In 1944 the United States was still short of high-test aviation 
gasoline and Buna rubber. 

Instances of this later variety of sabotage have been indicated 
and it may be that here is the place to include an excerpt from the 
"Act (of April 20, 1918) to punish the wilful injury or destruc- 
tion of war material and for other purposes/' which was 

amended on Nov. 30, 1940 and includes this addition to the original 
law: 

Sec. 5. That whoever, with intent to injure, interfere with, 
or obstruct the national defense of the United States, shall 
wilfully injure or destroy, or shall attempt to so injure or 

destroy, any national defense material shall, upon 

conviction thereof, be fined not more than $10,000.00 or 
imprisoned not more than ten years, or both. 

However it was not the above statute but the antitrust laws 
which were invoked oh, how gently in such cases of Farben's 



276 TREASON'S PEACE 

Industrial espionage and sabotage, as were taken to court after 
Thurman Arnold finally got his Irish up and went gunning for 
the dye trust American fronts. 

General Aniline and Film is amply discussed elsewhere in this 
story. This Treasury report of 1942 also described the seizure of 
Farben-owned Chemnyco, Inc., which was incorporated in 1931 
as successor of the United States and Transatlantic Service Corp., 
Inc., a high sounding title that had succeeded a group called the 
Committee on Political Economics in 1930. Max Ilgner was its 
organizer. 

Wilfrid Greif, a Farben director and also one of the top men 
in American I.G. Chemical Corp., originally held stock control 
of Chemnyco and he was succeeded in 1935 by our old acquaint- 
ance D. A. Schmitz. 

William vom Rath, another of the sons of Farben was a part- 
time holder of Chemnyco stock and his pal Walter Duisberg in- 
cluded this organization among his multitudinous duties as Far- 
ben's chief trouble shooter in its American hideouts. 

Among the notables who served as directors of Chemnyco were 
Dr. Karl Hochswender, who was also active in Farben's mag- 
nesium set-up; Carl B. Peters, vice-president of Synthetic Nitrogen, 
and its one-time president (of whom more later); and the late 
William Paul Pickhardt, son of one of the Kuttroff & Pickhardt 
founders who started as an office boy in that Badische-Farben 
hideout, became its president and, before he died in 1941 had 
also served as an American-born figurehead for Farben in many 
of its hideouts. 

Mr. Pickhardt was also president of Chemnyco but its real head 
was Rudolph Ilgner. Each of these four Chemnyco directors, as 
told elsewhere, was indicted one or more times and never pun- 
ished save for the picayune $1,000 fine paid by Ilgner for burning 
Chemnyco secret files. 

Nominally a wholly American-organized and owned corpora- 
tion, Chemnyco started out with a yearly subsidy from Farben 
of $84,000 which annual retainer by 1938 had increased to $240,000. 
However it was not restricted to this generous budget outlay, 
the Chemnyco management being authorized to incur any addi- 
tional or "special" expenses which were considered "necessary or 



TREASON'S PEACE 277 

expedient." This blank check arrangement indicated that Uncle 
Hermann and brother Max had great confidence in Rudolph 
Ilgner or else they thought that this might be a convenient 
method of denying responsibility for expenditures which later 
could be embarrassing to the Farben high command at Frankfurt. 

In addition to its stated income and special expenses, Chemnyco 
also handled enormous sums while acting as a receiving or collec- 
tion agency for funds due Farben from various partnership and 
patent license agreements in America. 

Among the services which Chemnyco was obligated to perform 
was to "facilitate" the activities of such individuals that Farben 
chose to send to this country including their introduction to our 
top level notables, when such contacts were deemed essential 
to the "accomplishment of the purpose of their visit." 

The details of these services as outlined in the agreement may 
appear sinister in view of some of the activities which have been 
uncovered. 

The Chemnyco staff undertook to make reports and act for 
Farben on governmental matters, including the recovery of prop- 
erty which had been seized by the Alien Property Custodian 
during the first World War, or to induce compensation (from the 
United States Treasury) for same. They also conducted negotia- 
tions and liaison relations with American corporations; acted as 
blind holders of American securities, prying into the affairs of 
such concerns, and reporting on scientific developments. 

Chemnyco was forbidden to do one thingit was specifically 
provided that it had no authority to do anything which American 
courts could construe as the "doing of business" by Farben inside 
of the United States. Thus its status as a false front was established 
in pseudo-legal language. However, Joseph J. O'Connell, Jr., head 
of the raiding squad of Treasury Secretary Henry Morgenthau, Jr., 
disregarded this camouflage and on December 11, 1941, the day on 
which Germany declared war, seized Chemnyco as a Farben 
property. 

A great mass of Chemnyco's secret records were burned by 
order of Rudolph Ilgner after the F.B.I, came to examine them 
in July 1939, as told elsewhere, but those which have been un- 
covered reveal in part the comprehensive character of Chemnyco 



278 TREASON'S PEACE 

espionage on industrial developments, especially as they related to 
war-making potentials. The Chemnyco pre-war reports to Farben 
dealt with such things as progress of the research in atomic fission, 
synthetic rubber tires, duPont's Nylon invention, manganese and 
magnesium resources and the annual production of the coke ovens 
of America. 

While the war in Europe was in progress there were compiled, 
under dates in June, 1941, long lists of reports on research and 
developments in Standard Oil (N. J.) laboratories and produc- 
ing plants. 

Ostensibly occupied wholly with the handling of patent appli- 
cation licenses and matters of this sort, Chemnyco practised espio- 
nage on the secrets of American industry, with results which were 
of tremendous value to Farben's preparations for war in Germany 
and for crippling and obstructing preparations for war in Amer- 
ica. By its great number of industrial contacts permitting corre- 
spondence, reports, and inspection visits which produced up-to- 
the-minute information of scientific and industrial progress here, 
Chemnyco was enabled to transmit secret intelligence to Max 
Ilgner's spy bureau at Berlin. This included confidential data which 
could not possibly be obtained by the conventional methods of 
secret agents. As a friendly patent holding company Chemnyco 
readily obtained the desired data at little cost and no risk, through 
exploitation of its industrial and commercial contacts. Tons of this 
material; process secrets, blueprints and national defense plans, 
were thus transmitted to Farben. 

An example of this pre-war espionage of a vicious type in spying 
upon American synthetic rubber research was revealed before the 
Bone Patents Committee of the Senate on May 20, 1943. This 
espionage was directed at development work on rubber sub- 
stitutes which had been conducted for some years by Dow and 
Goodyear; both companies had expended large sums and made 
good progress in this field; Dow already was marketing a rubber 
substitute which was acceptable for some purposes. 

According to testimony given before the Bone Committee by 
Professor R. M. Hunter, of the Justice Department's Antitrust 
Division, a request was made by Dow and Goodyear for licenses 
to utilize the Buna synthetic patents, about which it will be re- 



TREASON'S PEACE 279 

called (from Chapter iv) Farben kept Standard guessing for many 
years as a bait for the lopsided exchange of processes between 
them, and finally refused point blank, for military reasons, to sup- 
ply the know how. Dow and Goodyear got a runaround instead of 
a license to make Buna. An act was staged by Standard and I.G. 
Farben for the rubber companies, while they were kidded into 
believing that licenses might be forthcoming. 

And documentary evidence was also presented to the Com- 
mittee showing that Chemnyco, as Farben's patent agent, re- 
ported to headquarters on June 3, 1937, that: 

We thought it expedient to conduct the negotiations in 
such a way that we would continue to observe and become 
acquainted with Dow's and Goodyear's experiments. 

Posing as patent license negotiators on this vital munitions 
product, Rudolph Ilgner's Chemnyco spies wer pillaging results 
of this invaluable research work done by Americans for secret 
transmittal to Max Ilgner's espionage bureau in Berlin. 

During the summer of 1945, after Germany was occupied and 
some of Farben's staff were in custody, Dr. Oscar Loehr of the 
Farben staff at Frankfurt recalled that particular report from 
Chemnyco on synthetic rubber snooping, and admitted frankly 
that this Farben front in the United States did "conduct indus- 
trial espionage for I.G/' 

A general conclusion recorded by Dr. Loehr during one of his 
examinations is to the point: 

Question: So I.G. was able to suppress completely the syn- 
thetic rubber production in the United States, was able to 
use an American company, Standard Oil, to protect I.G.'s 
patents in case of war between the United States and 
Germany, and in that way I.G. itself undermined the mili- 
tary potential of the United States, and I.G. itself was 
able to carry on industrial espionage in the United States 
using its representatives, its participations and its agree- 
ments with American firms, to carry on economic warfare 
against the United States. Is that true? 



280 TREASON'S PEACE 

Answer: These are the conclusions which seem to disclose 
that I.G. impaired the military strength of the United 
States Yes. 

Likewise informative are excerpts from interoffice reports be- 
tween Farben's offices and government officials in 1940, when the 
Germans thought that the war was already won, and that the 
United States would stay out of it. 

One report, dated August 8, 1940, praises Chemnyco's services: 

Extensive information which we receive continuously from 

the Chemnyco is indispensable for our observations of 

the American conditions especially with a view to the tech- 
nical development Moreover this material is, since the 

beginning of the war, an important source of information for 
governmental, economical and military offices. Also in view 
of the later revival of trade with America, these informations 
are of importance to us. 

Another communication indicates prewar knowledge by officials 
of the United States Government of precisely what Chemnyco 
was up to. This report, dated July 20, 1940, states: 

We would not fail to mention that the Chemnyco was several 
times examined by the Authorities in the U. S. A. on its work 
and its connections with the I.G. and we would like to point 
out the confidential character of the above mentioned fact. 

Some day, it may be hoped, these pre-war "examinations of 
Chemnyco" by officials of our own government will also be brought 
to light, and the identity revealed of those so complacent "authori- 
ties'* who did not act when the character of Chemnyco's espionage 
was uncovered, especially after destruction of its secret files in 
1939. Perhaps those prewar investigators of ours are among the 
men who expressed such shocked surprise when, after we entered 
the war, some of the truth about Farben's allegedly secret activi- 
ties inside the United States came out in Congressional hearings 
(before these were choked off). 

Chemnyco had its headquarters at 551 5th Avenue in New 
York, and during the prewar period there was also located at 



TREASON'S PEACE 281 

that address the Chemical Marketing Company, another hideout 
of a Farben affiliate, the Deutsche Gold-und-Silberscheide Anstalt- 
a-g. This American front was incorporated in 1935 as the Frank 
von Kroop Company, changed its name to Chemical Marketing 
in 1937, and was headed by a German chemist, Dr. Ferdinand 
A. Kertess. That individual came to the United States in 1923 and 
commuted regularly back to Germany without becoming an Amer- 
ican citizen until 1938, by which time he had prospered in many 
varieties of activities and was established in a sumptuous suburban 
estate in Westchester County, New York. 

Dr. Kertess won what appears to have been the exclusive honor 
of being the only one of Farben's ersatz citizens to be lodged in 
jail in the United States. The crime for which he and his company 
were indicted in four different actions on November 6, 1942, was 
violation of the Trading with The Enemy Act, for which the 
defendants were convicted in July, 1943. The court fined them 
$14,000 and also awarded Dr. Kertess six years in jail, where, 
supposedly, he now languishes. 

Farben's connection does not appear in the record of these 
cases but its war plants undoubtedly were in dire need of the 
rare metals shipped by Kertess, such as palladium, rhodium and 
iridium, all invaluable in the production of war munitions and 
implements. Dr. Kertess made use of a woman courier to smuggle 
the precious metals out of this country to Germany via a circuitous 
route first to the Canal Zone, then to Colombia and Chile in South 
America, and overseas to Italy by plane. 

This criminal agent appears to have been deeply involved in 
many varieties of subversive activities. He was known as the. 
power behind the scenes in the Board of Trade for German- 
American Commerce, Farben's hideout for Nazi propaganda 
agencies, which is discussed in the next chapter. According to 
statements which he made to the Dies Committee in 1940, his 
Chemical Marketing Company had acquired the Maywood Chemi- 
cal Company of Maywood, New Jersey, to manufacture a "spe- 
cialty," which he did not identify. The Maywood company was 
the long established narcotic producer of cocain from coca leaves 
and kola nuts. Also the maker of the syrup known as "Merchandise 
No. 5," which is used in well-known beverages, and around which 



282 TREASON'S PEACE 

revolved one of the most' bitterly contested court cases in the 
early years of Harvey Wiley's Pure Food and Drug Law. 

Why Dr. Kertess should have acquired a large plant for the 
production of narcotics has not been revealed. He was also on 
close terms with the American I.G. Chemical people and was 
active after the war broke out in shipping chemicals to Farben's 
South American agents, whose supplies had been cut off by the 
British blockade. His company likewise served as an alleged 
American assignee of German patents, in a vain attempt to 
prevent their seizure after the war started. 

Among his other public-spirited activities, Dr. Kertess took a 
leading part in promoting an organization called the American 
Foreign Trade Association which, according to a letter written 
in August, 1939, to Germany about it, was promoting a friendly 
attitude towards Germany among members of Congress by the 
employment of lobbyists at $50 per day, plus expenses for 
"secretaries." 

This reference to the use of money by the phony Kertess organi- 
zation to influence members of Congress as World War II was 
beginning, may be a reminder of the statement made on the floor 
of the House of Representatives on September 31, 1917, by Tom 
Heflin of Alabama, then a Congressman, when it was revealed 
that German Ambassador von Bernstorff, prior to our entry into 
the first world war, had cabled the Kaiser's government at Berlin 
for: 

authority to pay out $50.000 in order, as on 

former occasions, to influence Congress, thru the organiza- 
tion you know of, which can perhaps prevent war. 

Tom Heflin, later to become famous as a firebrand in the Senate, 
asked for investigation of those members of the House and Senate 
who had acted in a suspicious manner by their pro-German 
speeches, resolutions or bills, and demanded their expulsion if 
found guilty of being influenced by the mysterious organization 
referred to by von Bernstorff. 

Having placed this challenge to his colleagues on the record 
Mr. Heflin followed up with some even more crude remarks in 



TREASON'S PEACE 283 

the press about "lady spies" and a gambling room in Washington 
where "peace-at-any-price" members of Congress were extraordi- 
narily lucky at cards. 

The only result of these 1917 charges was a rebuke to Congress- 
man Heflin. Demands for investigation of similar legislative mis- 
conduct before and during World War II were likewise ignored. 

On May 4, 1939, four months before the German army crossed 
the Polish border, Dr. Kertess cabled one of his friends in Frank- 
furt that he was "together with friends, ready for war." Shortly 
after this he engaged a New York newspaperman, James E. 
Edmunds, for espionage work, which he termed "research," and 
for which Mr. Edmunds was paid some $1,500 by Chemical 
Marketing. 

In justice to Mr. Edmunds, it should be stated that his activities 
in reality constituted counter-espionage of a very clever character, 
and were conducted under the directions of the F.B.I, and British 
and French Intelligence officials, to whom he reported as soon 
as he realized the character of the "research" he was to do. Origi- 
nally engaged by a representative of the Japanese News Agency 
Domei, who paid him handsomely, Edmunds became suspicious 
and reported to the authorities. These suspicions became a cer- 
tainty when the Jap, Mr. T. Sato, sent him to Dr. Kertess, and the 
latter in turn asked him to contact one Dr. Herbert Gross, de- 
scribed as a German agent, who was operating a news agency in 
New York as a front. Gross wanted information about American 
war plants, British and French ships sailing from the United 
States and Canada, and other espionage matters. Mr. Edmunds 
accordingly traveled to Halifax, Nova Scotia, on his pretended 
spying, hoping to contact the Kertess-Gross agent across the 
border, and supplied his treacherous paymasters with much false 
data which was gotten up for him by the American and British 
authorities. He had some difficulty in securing from Dr. Gross 
the additional funds which the latter promised him, but appeal 
to Dr. Kertess always caused such financial troubles to be ad- 
justed. The latter assured Edmunds that he was personally deliver- 
ing the data thus secured to the German Naval Attache at Wash- 
ington. Gross also asked Edmunds to bribe employees of Pan- 



284 TREASON'S PEACE 

American Airways to supply information about British defenses 
at Bermuda, and the establishment of a convoy base there, with 
reports on its shipping. 

Finally, according to Edmunds* sworn statements, Dr. Kertess 
solicited his aid in getting shipments of chemicals through the 
British blockade. On the record, Dr. Kertess appears to have been 
a most important cog in Farben's domestic espionage machine. 
But Mr. Edmunds made a monkey out of this Farben agent with 
his counter-espionage fairy stories. 

Our old acquaintance, Dr. Eugene R. Pickrell, the Metz handy- 
man and Farben lobbyist, reappears in the picture as receiving 
an annual stipend of $6,000 from Chemnyco on an arrangement 
that was made in 1931, by which Dr. Pickrell represented Far- 
ben's interests in a legal capacity. Unhappily for Dr. Pickrell, the 
freezing order issued by President Roosevelt in June, 1941, ap- 
pears to have interfered with the delivery of the Pickrell meal 
ticket in the customary manner, and Farben accordingly cabled 
its good friends Rohm & Haas, of Philadelphia, to please arrange 
a special license from the Treasury so that Chemnyco could pay 
Pickrell out of funds which the Philadelphia firm owed to Far- 
ben, for which Chemnyco acted as collector. 

Mr. Morgenthau unkindly said "nothing doing/' so Mr. Pickrell, 
who is not easily discouraged, made another try after the Alien 
Property Custodian had taken possession of funds due Farben 
from Rohm & Haas. In 1943 Dr. Pickrell put in a claim to the 
Custodian for the $4,500 still unpaid on his 1941 salary for serving 
Farben in his native land. Again Dr. Pickrell lost out. The Cus- 
todian's Vested Property Committee decided that the Pickrell 
"evidential burden has not been sustained." 

Dr. Pickrell, like Dr. Kertess, appears again in the next chapter 
as an important figure in Farben's propaganda hideout. 

Among other duties Chemnyco and its predecessors also agreed 
to prepare, publish and circulate in America any advertising or 
other publicity which Farben might request. Chemnyco had no 
publication of its own. Here obviously was where the joint direc- 
tion by Rudolph Ilgner of both Chemnyco and the German- 
American Board of Trade became so useful. The latter's monthly 
Bulletin circulated among the cream of American industry, com- 



TREASON'S PEACE 285 

merce and finance, as the organ of a group of top ranking public 
spirited companies and individuals. Farben thus possessed an 
agency to wield influence in business circles and on high Gov- 
ernmental policies which far exceeded that of all the rest of the 
blatant pro-Nazi publications representing the Bund and other 
groups of the less respectable levels of American society. 

So Rudolph Ilgner's powers as Chairman of the Board of Trade 
executive committee fitted in splendidly with those which he 
exercised as head of Chemnyco. 

Which activities his brother Max, head of Farben's world-wide 
spy bureau in Berlin, was to admit (after his capture in 1944) 
"might" have violated the United States security statutes. They 
did. But Rudolph, by then raising chickens in Connecticut, should 
worry. 



CHAPTER XV 



Propaganda for Wall Street 
and Washington 



"EVERY AMERICAN 

businessman should endorse what James S. Kemper, President 
of the United States Chamber of Commerce said in a state- 
ment issued on May 18th: "The primary concern of American 
business today is that our country will not become involved 
in any foreign war. Business is not looking for the advantage 
of war profits and definitely is opposed to sending American 
boys and young men to fight on foreign soil!" 

The pacifist views of Mr. Kemper, who was elevated to pre- 
eminence among business men and politicians by his title as Presi- 
dent of the U. S. Chamber of Commerce, were thus extolled in the 
Bulletin of the Board of Trade for German-American Commerce 
for June 1940, during that tragic period of the war when Germany's 
ultimate victory appeared inevitable providing a craven America 
could be persuaded to keep out of it, disarmed spiritually and 
physically, and thus he destined to stand alone in a final hour 
of German triumph. 
986 



TREASON'S PEACE 287 

After the death of Wendell Willkie, on October 8th, 1944, it was 
revealed that when the Republican National Committee was being 
reorganized, he aided in assembling data which was published 
regarding the isolationist record of James S. Kemper, who had 
been appointed financial chairman for the Dewey campaign. He 
was designated to handle the task of securing contributions from 
those business men and industrialists who believed that their best 
chance for a peace-time set-up satisfactory to their purposes would 
be by a Republican victory in that November election. 

It would appear that Mr. Willkie, in examining Mr. KemperV 
record, did not grasp the full significance of the use which had 
been made of the Kemper doctrines by the organization which 
had so praised his appeal to American industrial leaders that 
America must keep out of the war. 

This organization was the supposedly respectable Board of 
Trade for German-American Commerce, the New York offices 
of which were finally raided and closed in December 1941, when 
the secretary and editor, Dr. Albert Degener, was interned and 
later shipped back to his native Germany. 

Mr. Kemper's full statement as it appeared in the June, 1940, 
Bulletin, followed the usual isolationist line but was slanted to 
the viewpoint of businessmen by enlarging on the inevitable in- 
crease in our national debt and heavy taxes should we become 
involved in the war. It demanded that "we must be realistic and 
not emotional" by refusing to fight Germany. Insofar as the Euro- 
pean war was concerned, profits rather than patriotism appeared 
the important thing for businessmen to consider. 

That this kind of an appeal in the name of the United States 
Chamber of Commerce should have appeared in such a publica- 
tion, and at such a time, is ominous. Probably neither Mr. Kemper, 
nor many of the respectable American business companies which 
belonged to the Board of Trade ever took the trouble to find out 
that this organization was registered with the State Department 
as a representative of foreign principals, the names of which in- 
cluded German I.G. Farben and other German industrial and 
financial enterprises which were tied into that huge war machine. 
However, these gentlemen could have discovered that many of its 
American members were affiliates or subsidiaries of I.G. Farben, 



288 TREASON'S PEACE 

and that its executive officers were employees of, or dominated 
by, I.G. Farben. 

The German-American Board of Trade as a source of pro-Nazi 
propaganda was immune until after we entered the war because 
of the apparent respectability and high position of some of its 
members. A fact which escaped Mr. Willkie and those who dug into 
Mr. Kemper's record is that ample evidence was available that 
this allegedly legitimate organization of businessmen engaged in 
import and export with Germany appears in reality to have been 
just another one of the "Tarnung" or false fronts of German I.G. 
Farben, set up in this country by its predecessors of the Dye 
Cartel and directed by its employes under cover of the names of 
respectable American companies which either did not realize its 
real purpose or which, for benefits received, were willing to act 
as stooges for the mighty I.G. Cartel. 

Chief organizer of the German-American Board of Trade, in 
1924, was the notorious Herman Metz, who has already been re- 
vealed as one of the most obnoxious American agents of the Dye 
Cartel for a quarter of a century, a professed Democrat who in 
1919 switched his political and financial support to the Republican 
Ohio gang and its weakling, Warren Harding, for President. Metz, 
as its first president, announced that the purpose of the German- 
American Board of Trade was to find proper outlets for American 
products in Germany and to divert German imports in this country 
to channels where they would not conflict with American indus- 
tries. To Metz it was to be a commercial "love thy neighbor" 
affair. (Love thy German neighbor forget the war.) 

In 1934, when Metz passed to his reward, he was still president 
of the Board of Trade and by that time, according to evidence 
revealed before the Congressional Committee on un-American 
Activities, some of the board's officers and members were busily 
engaged in spreading the Nazi brand of sweetness and light (kill 
thy non-Ayran neighbor) in the United States. 

When legislation for return of enemy properties was pending 
in Congress in the 1920's, the German-American Board of Trade 
vehemently denounced all those who opposed this proposal with 
insistent demands that "American honor would be stained" unless 
all German properties we had seized were handed back. 



TREASON'S PEACE 289 

Again in the late 1930's it was the Farben Board of Trade 
that led the assaults on Washington, first in protest to the Treasury 
Department for imposing countervailing duties on German im- 
ports; and, after the war began, to the State Department for not 
breaking the British blockade. 

These Board of Trade gentry, from the time that it was organ- 
ized, included a considerable number of those who during World 
War I had been engaged in similar subversive activities, in close 
cooperation with the American representatives of the German Dye 
Cartel of that earlier period. Herman Metz merely had the stage 
scenery repainted for the new false front the actors and the action 
were frequently the same as before and during the first World War. 

When officers and directors of the German-American Board of 
Trade wrote to or appeared before Cabinet officials and Congres- 
sional Committees, they had behind them a list of representative 
American corporations which appeared untainted by Nazi influ- 
ence. They disguised and kept well in the background the I.G. 
Farben controlling influence. 

It was James S. Martin of the War Division of the Justice De- 
partment, who later was to try to undue some of the post-war mess 
created by Farben's friends in Germany who finally realized the 
true significance of the German-American Board of Trade as the 
headquarters where Metz and Ilgner had brought together the old 
crowd of Dye Trust pals of World War I with those newly added 
to Farben's Tarnung. And these important figures, when asso- 
ciated with other influential personages who were untainted by 
Nazi ties, were then able to flaunt their high place in public 
banquets and thus launch materialistic propaganda aimed at the 
cream of America's social and political economy. 

In the fateful year of 1939 the Honorary President of the German- 
American Board of Trade was the late Julius P. Mayer, American- 
born top man of the Hamburg-American Steamship Lines in the 
United States for many years, the same Mr. Mayer who, during 
World War I, was closely associated with that notorious German 
spy, the American Bayer Company's Dr. Hugo Schweitzer; with 
the Kaiser's pay-off man, Dr. Heinrich Albert, and all the rest 
of the gang of German agents who made the Hamburg-American 
offices headquarters for propaganda, espionage, and sabotage dur- 



290 TREASON'S PEACE 

ing the war period until the United States Government finally 
raided it and sent some of its personnel to jail. 

Among Mr. Mayer's other World War I associates in the conduct 
of the earlier "Keep Us Out of the War" campaign, was none other 
than the still-celebrated Edward A. Rumely, who in April 1946, 
was to win an acquittal after two trials on an indictment for re- 
fusal to show a Congressional Committee the names of contribu- 
tors to his more recent activities. 

It was an executive secretary of the Committee for Constitu- 
tional Government, in which Mr. Frank Gannett was a prominent 
participant, that Mr. Rumely crossed swords with Congressional 
Committees in 1938 and 1944 for refusing to reveal the identity of 
those who put up the funds used by his new organization; much 
of which, before the war began, was violently isolationist and 
anti-war. Mr. Rumely, being held in contempt by Congress for 
his refusal to tell all, finally went free by grace of a second trial 
jury, despite his earlier record as an ex-convict. 

It will be recalled that during the earlier war Rumely conspired 
with Bayer's Schweitzer to purchase the New York Evening Mail 
with secret German funds, and after the war served a jail term 
for these subversive activities. As was elsewhere shown he also 
came within the Sterling-Farben orbit in 1929. 

Mr. Mayer's training during the first war, which qualified him 
to become the honorary head of the Board of Trade in prepara- 
tion for the next war, included membership in the fake German 
University League, a propaganda agency financed largely by the 
American Bayer Company through H. C. Seebohm, Bayer's secre- 
tary; with Dr. Schweitzer as a trustee, and all of the other im- 
portant Bayer officers (including those who were indicted and 
interned) among its members. 

It was the president of this German University League, Dr. 
Edmund von Mach, who in February 1917, bombarded members 
of Congress with impudently worded pamphlets and letters at- 
tacking President Wilson's request for a declaration of war on 
Germany. 

President of the German-American Board of Trade in 1939 
until he died on February 20th of that year, was Herbert A. John- 
son, whose ostensible business was that of handling publicity for 



TREASON'S PEACE 291 

the Leipzig Trade Fair (of Germany) in the United States. Mr. 
Johnson's death occasioned a noteworthy tribute in the- next issue 
of the Bulletin, which featured cables and letters of condolence 
received from Dr. Max Ilgner of Berlin (Head of Farben's Secret 
Intelligence Bureau); attendance at the funeral of representa- 
tives of Farben's Chemnyco, Inc., and beautiful flower arrange- 
ments bearing the card of I.G. Farbenindustrie a.-g. of Frank- 
furt, Germany. (A long distance to say it with flowers.) 

However the actual director of the Board of Trade after Herman 
Metz died appears to have been the chairman of its executive 
committee, Rudolph Ilgner, brother of Max and head of Chemnyco, 
whose job there was described in the last chapter and discussed 
elsewhere. Rudolph Ilgner was indicted on the day Germany 
invaded Poland, for destroying evidence in the files of Chemnyco 
which a federal grand jury had demanded. This indictment was 
kept a secret from the public for a long time after it was handed 
down, but Mr. Ilgner and Farben knew about it, and in Novem- 
ber 1939 the Board of Trade, with expressions of deep regret and 
praises for his invaluable services, accepted Mr. Ilgner 's resigna- 
tion as chairman of its executive committee. Perhaps the vote of 
thanks had special reference to Mr. Ilgner's criminal destruction of 
records which would have exposed some of the treasonable activi- 
ties which were being conducted through the offices of Chemnyco 
and other Farben affiliates in the United States; or perhaps the 
Board's directors merely wished to pay tribute to their chairman 
for having arranged an elaborate reception and dinner at the 
Deutsche Verein in New York City in honor of Captain Fritz 
Weidemann who had just arrived in this country to become Con- 
sul General for Nazi Germany by order of Adolph Hitler, and 
who had acted, a few months before, as the official escort of former 
President Herbert Hoover during the latter's grand inspection tour 
of Nazi Germany in 1938 (of which more later). This Ilgner- 
Weidemann dinner took place some months before Captain 
Weidemann was exposed as Pacific Coast head of Nazi espionage 
and was ordered to get out and stay out of the United States. 

The Farben-Ilgner executive body of the German-American 
Board of Trade included Ernst Schmitz, director of the German 
Railroad Information Service; J. Schroeder and C. J. Berk of the 



292- TREASON'S PEACE 

Nazi combined Hamburg-American and North German Lloyd 
Steamship Company and other notables. Mr. Schmitz's Informa- 
tion Services, financed by the Nazi government, had included 
engaging the public relations firm of Carl Byoir and Associates 
for $6,000 per month, presumably to give council to Americans 
how to become German tourists. The ubiquitous George Sylvester 
Viereck, editor of the German Library of Information "Facts on 
Review" was also on the Byoir payroll at $1,750 per month, plus 
many more thousands from other sources, helping to edit a propa- 
ganda sheet called the German-American Bulletin tor the guid- 
ance of the prospective tourists, Mr. Schmitz also tied in with the 
notorious Manfred Zapp, the Casanova head of the Nazi handout 
agency Transocean News Service, until the latter was interned 
and indicted in 1941; Transocean, according to information found 
in Zapp's files, was owned among others by I.G. Farben's Robert 
Bosch, and the Hamburg-American Lines. 

On November 30, 1939, according to a letter written by Mr. 
Schmitz, that member of the Board of Trade's directorate wrote 
inviting Zapp to attend a meeting at the Schmitz apartment in 
New York of a "number of people of the Intelligence Service of 
the Rome-Berlin Axis." This invitation gives some indication of 
the kind of people included in the management of the Metz- 
Ilgner-Farben Board of Trade. Mr. Schmitz, like Mr. Mayer, had 
World War I training in pro-German, anti-war activities; he was 
then an editor of the Ridder family's Staatz-Zeitung, which at- 
tained notoriety during the first war and, while preparations for 
the next war were under way, heaped editorial ridicule on the 
heads of those who saw the slightest impropriety in I.G. Farben's 
penetration into American munition industries. 

Mr. Schroeder, who had been with Hamburg-American for 
thirty years, was vice-president of the Board of Trade in 1939 
as well as director and member of its executive committee; 
Schroeder, along with his North German Lloyd colleague, C. J. 
Berk, also aided in Viereck's editorial labors. Among the Ham- 
burg-American propaganda activities during the second world 
war, as during the first one, was the transportation. to this country 
of tons and tons of printed matter of the most vicious character 
such as Ivy Lee, Farben's American hired press agent, once de- 



TREASON'S PEACE 293 

scribed as "books and pamphlets, and newspaper clippings and 
documents, world without end." 

Incidentally it was the Hamburg-American-North German 
Lloyd, and the German Railroad Information Office which relayed 
from the Hitler government the funds through which Heinz 
Spanknoebel (until he was indicted and skipped) had financed 
the original gutter publication of the Nazis in this country Das 
Neues Deutschland (The New Germany). The Board of Trade's 
Mr. Schroeder saw to it that this alleged newspaper he was help- 
ing to finance had plenty of readers in 1932 he sent a letter to 
each Hamburg-American employe instructing them to join the 
Friends of New Germany. The ships of these German lines, in- 
cluding the Bremen and Europa, when docked in New York be- 
tween trips, were thrown open to the Bund and other Nazi groups, 
for meetings and banquets in full uniform. The Hamburg-Ameri- 
can did yeoman service in the inside job of softening up America 
for World War H-just as it did for World War I. 

Officers of the Board of Trade who were not members of the 
select Ilgner committee included Dr. Degener, already mentioned, 
and Heinrich Freytag its Treasurer, who was also an employe of 
the German Embassy at Washington. Dr. Degener, according to 
evidence said to have been seized and suppressed by the McCor- 
mack Committee in 1934, contributed large sums to Nazi organiza- 
tions in America. Degener started a red hot campaign against the 
anti-Nazi boycotts when they began in 1933; he threatened pub- 
licly that the boycott would cost this country's businessmen their 
most profitable customers in Germany, and the interest on over 
two billion dollars of American investments in the Fatherland. 
Degener was particularly bitter at New York City's LaGuardia 
for advocating the boycott; he denounced the pugnacious Little 
Flower for endangering what he termed the "peaceful relations" 
between the United States and Germany. 

One of the directors of the Board of Trade in 1939 when the 
war began was our old friend Dr. Eugene R. Pickrell. This ubiqui- 
tous gentleman, still on Farben's payroll as revealed in the pre- 
ceding chapter, was now listed as a customs attorney, his office 
was across the hall from the Trade Board at 10 East 40th Street, 
New York City; and he made another trip to Washington on De- 



294 TREASON'S PEACE 

cember 1, 1939 with Dr. Robert Reiner then president of the 
Trade Board, to protest bitterly to Secretary Hull against the 
British embargo on exports from Germany. These Farben Board 
of Trade protests in 1939, after Germany had gone to war, at 
interference with the rights of American citizens to engage in 
trade with Germany, were framed in almost the same words as 
those made by the Dye Cartel's Herman Metz to Secretary Bryan, 
and to President Wilson himself in 1915 about the British blockade 
in Germany's first world war. History repeats. 

Carl Schreiner, of the Pilot Insurance Company of New York, 
was also a director of the German-American Board of Trade in 
1939. Back in World War I days Schreiner had achieved notoriety 
through mention as an alien enemy in a Justice Department re- 
port on what was called the German Insurance Pools conspiracy, 
the purpose of the pool being to fight the British boycott and black- 
list by the creation of dummy insurance companies. The Justice 
report indicated that the German Dye Trust's American Bayer and 
Cassella outfits were involved in this insurance monkey business. 

Another 1939 director of the Farben Trade Board whose name 
recalls World War I was George W. Simon, listed as vice-president 
of the Heyden Chemical Company. Back in 1915, Mr. Simon was 
chief chemist for the Heyden concern when Dr. Hugo Schweitzer 
put over his phenol deal on Tom Edison with the assistance of 
Simon's father-in-law, Richard Kny. It was Heyden, it may be 
recalled, who purchased the surplus Edison phenol and used it 
in making drugs in order to prevent its conversion into munitions 
for use against Germany. 

Active in the behind-the-scenes affairs of the German-American 
Board of Trade until the end was Dr. Kertess, whose jail term and 
espionage escapades appear in the previous chaptqr. To be always 
available, Dr. Kertess moved his offices to the same building as 
those of the Trade Board and his colleague, Dr. Pickrell, and as a 
supporter of Nazi propaganda, in 1939, helped to found the notor- 
ious American Fellowship Forum, whose "Today's Challenge" was 
edited by George Sylvester Viereck (before he was jailed), and 
whose National Director was Dr. Friedrich Ernst Auhagen, 
former instructor at Columbia University, who was also jailed 
for failure to register as a German agent, and, when he got out, 



TREASON'S PEACE 295 

was promptly interned as an enemy alien, and his citizenship 
revoked. 

Dr. Kertess protested to the Dies Committee in 1941 that he 
took no active part in organizing the Forum, but it developed 
that he paid the rent for its offices on West Forty-Second Street, 
New York, out of his personal funds. The vice-president of his 
Chemical Marketing Company, Richard Koch, was one of its 
founders, and when Dr. Auhagen retired as Director, Dr. Kertess 
became one of the holders of the registered title of the Forum. 
Until he got into difficulties with, the law, Dr. Kertess devoted 
much time and talent to arranging a grandiose plan for what he 
called the "Organization of German Industry in America after 
the War." This peace-time absorption of American industry was to 
be managed by none other than the Board of Trade for German- 
American Commerce with Dr. Kertess and othe~r representatives 
of I.G. Farben as Directors. 

A 1939 director of the German-American Board of Trade who 
had an exemplary record as an American-born citizen and who 
engaged in pronounced isolationist propaganda, was James D. 
Mooney, World War I veteran, Lieutenant-Commander, U. S. N. 
R., and vice-president of General Motors Corporation. One of Mr. 
Mooney 's anti-war contributions was an appeal on the subject 
which was introduced into the Congressional Record by Demo- 
cratic Senator E. C. Johnson of Colorado, reprinted and distributed 
as a pamphlet and then published in amplified form in the Satur- 
day Evening Post, August 3, 1940, under the title "War or Peace 
in America." 

In that article Mr. Mooney described the horrors of war and 
Germany's defense of her own position. He criticized our attempt 
to aid England as futile, and insisted that the influence of the 
United States should be directed toward saving England a further 
beating by using our strength in the situation to compel a peace 
with Germany. 

As a native-born American, Mr. Mooney was in strange company 
among some of the German nationals of the Board of Trade. Ac- 
cording to Who's Who of 1940-41 Mr. Mooney was awarded the 
"Order of Merit of the German Eagle." Apparently some one in 
the Fatherland liked his brand of Americanism. 



296 TREASON'S PEACE 

In the Bulletin of the Board of Trade for October, 1940, General 
Motors' Mr. Mooney was quoted as saying, with reference to our 
possible entrance into the war: 

"On the day was is declared, we can kiss democracy good-bye." 

When Mr. Ilgner threw a banquet it was a sumptuous affair, 
with big names on the seating list overshadowing the identity and 
purposes of those in the background. For a grand luncheon which 
he gave in the name of the German-American Board of Trade on 
May 27, 1937, to honor His Excellency Dr. Hans Heinrich Dieck- 
hoff, the German Ambassador, parts of the seating list read like 
a directory of representatives of Farben hideouts and affiliates in 
this country. 

One table seated I.G. Farben's distinguished Director Dr. Wil- 
helm Ferdinand Kalle, along with Sterling's president, A. H. Die- 
bold; General DyestufFs E. K. Halbach; Synthetic Nitrogen's A. L. 
Mullaly; W. P. Pickhardt of the old Badische agency; and Dr. 
E. R. Pickrell, the Metz handyman. With these close pals of Far- 
ben sat E. H. Meili, vice-president of the J. Henry Schroder Bank- 
ing Corporation,, of New York and London, lending a high note 
of Anglo-American financial approval to that group, and Ferdi- 
nand Andreas, Prince of Liechtenstein, added a touch of royalty. 

Another table was graced by Rudolph Ilgner himself; Dr. K. 
Hochswender, of Magnesium Development and Chemnyco and 
D. A. Schmitz, of General Aniline. Among other Farben affiliates 
American Bemberg Company was represented by director H. W. 
Springorum; Fezandie & Sperrle by Oscar E. Sperrle." 

Scattered through the seating arrangements were George Syl- 
vester Viereck and Fritz Kuhn ( this was some time before these 
two were convicted and locked up), also another celebrated pair, 
Dr. F. E. Auhagen and Dr. A. Degener (this was also before 
that couple were picked up by the F.B.I. ) . 

Two other notables who graced this gathering were Dr. Herbert 
Gross who hired an American spy for Dr. Kertess, as revealed in 
the previous chapter; and Col. Ed. Emerson, notorious as a Ger- 
man agent during both world wars. Theodore Dinkelacker and 
Willy Luedtke, national leaders of the Bund, were also present. 
It was what might be called a "mixed" gathering. 



TREASON'S PEACE 297 

On the dais with the guest of honor and Board of Trade officers 
sat James D. Mooney of General Motors; Editor Victor F. Ridder; 
F. W. La Frentz, president of the American Surety Corp.; Col. 
Sosthenes Behn, of the International Telephone & Telegraph, and 
other notables. It surely appeared to be a representative peace- 
time gathering of influential American citizenship. 

When its connections are noted it may be more readily under- 
stood that this Farben organized and directed Trade Board was 
so respectable or so powerful, even after its offices had been 
raided and closed in December 1941, that its name was conspicu- 
ously missing from the long list of propaganda agencies, espionage 
hideouts and subversive organizations which was published as 
defendants or participants in four blanket indictments handed 
down in the District of Columbia in 1941-'42 and '43, out of which 
George Sylvester Viereck drew one conviction in 1942, which was 
reversed by the Supreme Court, and one in 1943, which put hin> 
back in jail. 

The Trade Board's subversive activities were largely ignored by 
the Dies Committee when the latter partially uncovered many 
of the less important pro-Nazi propaganda agencies in the United 
States, and by the Truman and Bone Senate Committees when 
they partially lifted the lid on other Farben-American hideouts. 
It remained for hard-hitting James S. Martin, Chief of the Justice 
Department Economic Warfare squad to bring out some of the 
background facts and pre-war activities of the Board of Trade 
in testifying before Senator Kilgore's Sub-Committee on War Mo- 
bilization in September 1944. 

Ample evidence has been revealed in Chapter II and elsewhere 
in this story that the German I.G. through Bayer and other Amer- 
ican fronts engaged in propaganda, espionage and sabotage prior 
to and during World War I. The Ivy Lee advisory service engaged 
by Farben as discussed in Chapter x revealed how that agency 
of the dye trust continued its propaganda activities in anticipa- 
tion of World War II. 

In considering much of the evidence relating to appeals for 
pacificism, isolation and disarmament, it is frequently difficult 
to distinguish criminal propaganda from the protest which arises 



298 TREASON'S PEACE 

in the idealism of thousands of patriotic citizens whose normal, 
sincere hatred of war formed the nucleus of much of the pre-war 
sentiment which has divided public opinion in the United States 
on our mythical isolation. 

To step away from the domestic scene for the moment, we 
might consider the "Union of Democratic Control" of London 
which, in 1932, published an expose of what its authors described 
as the secret "Bloody International'* or munitions combination, 
which included I.G. Farben and was accused of continually 
conspiring to cause wars in order to reap profits from the result- 
ing demand for battleships, guns and munitions. 

This pamphlet advocated abolition of private manufacture of 
arms and munitions to insure world peace by disarmament. This 
was the same thesis which allegedly motivated the United States 
Senate Munitions Committee in 1934 when it uncovered the hold 
that Farben had already secured on our national defense indus- 
triesand then did nothing about it except to aid in weakening 
our own security. 

Evidently the idealistic English group was not directly inspired 
by Farben; actually that doctrine of disarmament thus preached 
was an integral part of the pattern of propaganda of the German 
dye trust in the period before we entered World War I, and again 
in the period before we entered World War II. 

When we examine the activities of many of the peace groups 
in the United States during the last pre-war period, it must be 
admitted that thousands of those men and women were sincerely 
patriotic citizens who would be quick to rebuke the suggestion 
that their detestation of war was induced even indirectly by 
foreign propaganda. 

One such group was World Peaceways Inc., of New York City, 
the letterhead of which carried the names of many distinguished 
citizens. This organization advertised its demands for peace by 
picturing the fact that women and children would be killed in 
the next war. On June 26, 1941, it issued an appeal for funds, 
copy of which was handed to me, with a message entitled "A Ref- 
erendum on War/* Accompanying that World Peaceways circular 
letter was a single page entitled "Sorry to Bother You," on which 
a wistful-looking youth asked you to talk over his plea to: 



TREASON'S PEACE 299 

Be a little careful, willya, about whether you send me to 
war or not. I mean, I'd hate to have you send me over to 

-fight and maybe die and then find out you'd made a 

mistake again, etc. 
Underneath was the demand: 

Keep America from making mistakes with her boys' lives. 
Write to the President today. Issued by World Peaceways, 
Inc. 103 Park Ave., New York. 

This appeal was sent out a few short weeks before the near 
tragedy in the Congress of the United States, on August 12, 1941, 
when the addition of just one more negative vote would have de- 
stroyed the training of our new Army. 

The vast majority of members of World Peaceways, and of 
its contributors, who would bitterly resent an intimation that 
I.G. Farben or any of its friends had anything to do with this 
organization, may be equally indignant to have it appear that 
an elaborate radio program which was staged in the name of 
World Peaceways some years previously was paid for by a phar- 
maceutical house which enjoyed close relations with Farben af- 
filiates in the United States, and the head of which was reported 
to have approached Farben officials at Berlin with the intention 
of offering the latter a participation in the business of this com- 
pany in the United States. 

After Pearl Harbor, contributions were again solicited by World 
Peaceways in letters stating that funds were needed to enable 
it to resume advertising to educate leadership for the next peace. 

Other expressions of this same type of idealism were found 
in numerous articles and books published in America during that 
critical period when it seemed at times that the people of the 
United States, and its government, would never start to arm, or 
take a stand until too late to do so except alone. 

One such book was "War, Peace & Change" by John Foster 
Dulles, published in 1939, a very studious pre-war volume which 
indicated the author's conclusion that quarantine, non-recogni- 
tion and sanctions were not solutions for problems of aggression 
by "dynamic" nations such as Germany, Italy and Japan. 

Mr. Dulles appeared to praise the peoples of these countries 



300 TREASON'S PEACE 

and to believe that they should not be confused with adventurers, 
soldiers of fortune or criminals, who might be "safely" repressed. 

The arguments and the peaceful desires of Mr. Dulles as thus 
expressed were no doubt welcome to the peace-at-any-price ideal- 
ists of this country during that tragic period. It may also appear 
that they were equally welcome to those who in Germany were 
guiding the behind-the-scenes preparations for war. 

Thus the great value for Farben of the propaganda agencies 
controlled or guided from within the membership of the German 
American Board of Trade was the fact that among its members 
were honorable American companies and individuals whose com- 
mercial relations with Germany were legitimate and of long stand- 
ing. For this reason the Trade Board for a long time was looked 
upon as above suspicion and as it spoke for business big busi- 
ness at that it was not subjected to that kind of public suspicion 
and distrust which was attached to groups like the Bund in the 
minds of many citizens during the decade before the entry of 
the United States into World War II. When on June 16, 1941 
the United States Government struck its first real blow at Nazi 
propaganda and subversive activities in this country, the three 
organizations which were ordered to close up with the twenty- 
four German consulates for "Activities of improper and unwar- 
ranted character" were the German Railroad Information Office; 
German Library of Information, and Transocean News Service- 
as three of the principal Nazi propaganda agencies in this country. 
All of these were tied in with the I.G. Farben-directed German- 
American Board of Trade as a clearing house for information, 
and a safe refuge until then for their personnel. But the Board 
stayed open until after Pearl Harbor. 

When President Harry S Truman, in December 1945, stated 
that the American people were responsible for what happened 
at Pearl Harbor as much as were our military forces, it might 
appear that our Chief Executive overlooked several highly im- 
portant factors which are brought to light in this book, and espe- 
cially in this chapter. Granted that the spiritual disarmament 
of the American people was due in part to the genuine idealism 
and pacificism of many honorable citizens, the fact remains that 
much of that idealism had a materialistic background, and much 



TREASON'S PEACE 301 

of this was induced, directly or indirectly, by the top level prop- 
aganda created and broadcast among our most influential circles 
to which I. G. Farben was able to appeal through the highly re- 
spectable Board of .Trade for German- American Commerce. The 
President, in that blanket indictment of American public opinion, 
overlooked what is perhaps the more important aspects of Far- 
ben's secret weapon of influence at the top levels of industry, 
finance, and politics which made it impossible for those who 
not only saw what was coming, but wanted something done about 
it, to be heard. 

Regardless of how the President's remarks may be taken, the 
excuse may be offered that when the Bulletin of the subversive 
agency parading as a Board of Trade publicized the isolationist 
views of Republican Finance Chairman James S. Kemper it meant 
no more than when the opinions of other prominent American 
citizens were likewise broadcast in this or any other publication. 
It is thus interesting to examine the contents of an issue of the 
German-American Commerce Bulletin which appeared in March 
1941, somewhat later than that containing Mr. Kemper's appeal. 
Many of the articles and editorials in this issue were emphatic 
pro-Nazi, anti-war propaganda appealing to the "business as usu- 
al" and appeasement sentiments of its readers. Various Farben 
officials and Farben's war-time accomplishments, making Germany 
now invulnerable, received mention in sketches and news articles. 
Included were pleas for appeasement of Germany and isolation 
for this country by pacificist advocates like General Robert E. 
Wood, National Chairman of the America First Committee, and 
Dr. Edward Lodge Curran, who stated that current "war monger- 
ing propaganda" ignored the fact that we had fought two wars 
with Great Britain in our history. A New York Daily News article, 
also bitterly anti-British, was reprinted, and the leading article, 
entitled "German-Americans in the World War," by Frederick 
Franklin Schrader, compared the hostility to German nationals 
in the United States during World War I, to current harrowing re- 
ports of racial persecutions by the Nazis in Germany. A descrip- 
tion of Mr. Schrader as a well known author of historical works 
failed to mention other activities, such as associate editorship of 
the Fatherland propaganda journal published during World 



302 TREASON'S PEACE 

War I, by our old friend George Sylvester Viereck; and during 
the present war again assisting the Viereck literary efforts as editor 
of Facts in Review, for the German Library of Information. 
According to Congressional records, Schrader was also for a time 
editor of Deutscher Weckruf und Beobachter, official organ of 
the German-American Bund, which, it need not be said, circulated 
among citizens of much lower levels of society than those of the 
highly refined industrialist readers of the Board of Trade Bulletin. 
In such select company there was also published in this same 
issue of the Bulletin an urgent appeal to its readers to read a 
book entitled "Shall We Send Our Youth to War/' which was 

described as a "a plea that the United States should stay 

out of the war." This book, which appears to have escaped the 
notice of the literary reviewers of this country, recited from the 
personal experiences of its author the "unparallelled famine and 
pestilence" which resulted from World War I. A few of the sig- 
nificant passages in the book may be quoted here: 

Amid the afterglow of glory and legend we forget the 
filth, the stench, the death of the trenches. We forget the dumb 
grief of mothers, wives and children. We forget the unending 
blight cast upon the world by the sacrifice of the flower of 
every race. 

We may need to go to war again. But that war should be 
on this hemisphere alone and in defense of our firesides or 
our honor. 

We should hold that the basis of international relations 
should not be force, but should be law and free agreement. 
The first thing required is vigorous, definite statement from 
all who have responsibility, both publicly and privately, that 
we are not going to war with anybody in Europe unless they 
attack the Western Hemisphere. The second thing is not to 
sit in this game of power politics. These are the American 
policies that will make sure that we do not send our youth 
to Europe to War. 

The author of this book also stated that prior to World War I 
he had lived with the "invisible forces which moved its causes," 
that he knew Europe intimately, "not as tourist but as a part of 



TREASON'S PEACE 303 

my workaday life," and that in 1938 he had spent "some months 
in Europe with unique opportunity to discuss its problems with 
the leaders of fourteen nations." On the cover of this book is a 
picture of a soldiers' cemetery, row after row of little white crosses; 
with quotations from the book, and a blunt request: 

If you want the United States to keep out of war, here is 
a book to send to your friends, to your Representatives, to 
all people who have power, directly or indirectly, to sway 
public and legislative opinion. 

Neither The New York Times nor the Herald Tribune book re- 
view sections ever mentioned this book, and according to the 
Book Review Digest, no other literary publication gave it any 
notice. That honor was reserved for the Bulletin of the German 
American Board of Trade, which urged its purchase and also 
announced its author to have been Herbert Hoover, former Pres- 
ident of the United States and Elder Statesman of the Republican 
party who strangely enough was to be elevated an expert emeritus 
on post-war problems of world famine by President Truman. 

In reply to my inquiry, Mr. Thomas R. Coward, of Coward, 
McCann, Inc., advised that the book was contracted for with the 
personal representative of Mr. Hoover, and that insofar as he 
knew, no one connected with the German-American Commerce 
Bulletin had anything to do with it. 

This statement may be accepted as entirely sincere as would 
be the protestations from thousands of Mr. Hoover's followers 
that his sentiments did credit to him and were shared by many 
others. 

The fact remains that the German- American Commerce Bulletin 
appears to have been the only publication in which mention 
of this book appeared. And that Bulletin was the official organ 
of the Board of Trade for German-American Commerce, Inc., 
the organization started by Herman Metz, in 1924; registered with 
the State Department as the agent of a foreign principal; and 
directed, in 1939, by Rudolph Ilgner, head of Chemnyco, the 
patent-holding and espionage outfit maintained by Farben in the 
United States. And Mr. Hoover's guide in Europe in 1938 during 
his "unique opportunity to discuss its problems" was Captain Fritz 



304 TREASON'S PEACE 

Weidemann. The position occupied in the public mind by our 
only living ex-President, a highly educated man of long experi- 
ence in international affairs, gave dignity and impressiveness to 
his demands that we keep our sons out of the war unless and 
until the invasion of the American continents should begin. ( This 
could only have occurred after Hitler had conquered Europe, 
and had landed in the Argentine, or Panama, or Long Island.) 
So Mr. Kemper, again the National Committee Treasurer, was 
still in good Republican company. 



CHAPTER XVI 



Counter-Propaganda & the Lobby 



IT IS A SAD 

thing to find men so money mad as to be willing to betray 
their country and their families for just a few more dollars. 

Thus Francis Patrick Garvan, in a speech before the American 
Institute of Chemists, summed up his feelings about those Ameri- 
cans who had helped his life long enemy reestablish itself in the 
United States. 

For Garvan, until the day of his death in 1937, was the implac- 
able foe of the German dye trust a tireless crusader who never 
gave up trying to warn his countrymen of the industrial Trojan 
Horse of the Germans had deposited on these shores. 

One of Garvan's greatest triumphs was the 1926 decision of 
the Supreme Court which decreed that: 

The purpose of the Trading with the Enemy Act was not 
only to weaken enemy countries by depriving their supporters 

of their property but also to promote production in 

the United States of things useful for the effective prosecu- 
tion of the war. 



306 TREASON'S PEACE 

Aside from the importance of that decision in preventing the 
immediate destruction of our new organic-chemical industry by 
returning the seized patents to the Germans, it is of tremendous 
significance to many phases of this story. 

Garvan made good use of this decision in meeting the many 
German-inspired attacks made upon him, and to further his work 
as director of the Chemical Foundation. The Foundation distrib- 
uted millions of pieces of educational literature; books, periodicals 
and pamphlets, and for many years was the strongest single force 
in America in pointing out the importance of organic chemistry 
to national security. 

The fact that Francis Garvan, who had wealth, power, and 
prestige to support his efforts, was ineffectual in curbing the en- 
croachments of the German industrialists, makes more under- 
standable my own many failures to break through the Farben de- 
fenses. And perhaps it should be explained here that despite the 
suggestion of mutual friends that Garvan and I should work to- 
gether, we never did. So I fought my own fight, in my own way. 

From the very beginning, the only organized support I received 
was of an indirect character from groups of physicians and phar- 
macists, mainly in New Jersey. In just one instance was financial 
assistance given me by one of these groups and stark tragedy 
was in the aftermath of that contribution. After the recent war 
began, I did, however, receive very welcome cooperation from 
a propaganda organization which started when Hitler came to 
power, the Non-Sectarian Anti-Nazi League. 

Founded by the late Samuel Untermyer in the early 1930's, 
the League began a boycott against the Nazis which included allies 
of Farben in the United States, and imports of Farben products. 

In Philadelphia, at one of its early mass meetings in 1934, the 
League was addressed by a local attorney named Francis Biddle, 
who demanded action, "in the only effective way that Mr. Hitler 
can understand the economic boycott, sustained, aggressive and 
unrelenting." "Words become pallid/' said Mr. Biddle, "a little 
absurd in the face of Nazi actions. We too must act/' 

Seven years later it was the same Francis Biddle who as At- 
torney General substituted the "pallid words" of consent decrees 



TREASON'S PEACE 307 

for criminal prosecution, "sustained, aggressive and unrelenting." 
And, when the Anti-Nazi League wrote to the Attorney General 
about one of those polite consent decrees, the reply, by his execu- 
tive assistant, the James Allen of Chapter ix, indicated that the 
Attorney General considered Sterling to be of great value to the 
nation in its war with Farben's empire. 

While the bellicose views of Mr. Biddle have softened with 
the passing of time, those of the Anti-Nazi League as directed 
by Professor James H. Sheldon never wavered, and its Bulletin 
distributed much valuable data regarding the danger of Farben, 
and the necessity of boycotting the products of such firms as 
Sterling, Winthrop, and General Dyestuff. 

In May 1941 after the failure of my efforts to induce Assistant 
Attorney General Arnold to tackle the Farben lobby (Chapter 
ix ) I turned my attack back on the Senate with an appeal to 
its Majority Leader, Alben W. Barkley. My letter, in part, follows: 

I say that the lobby is now and has been since I first ex- 
posed it, the spearhead of the German plan of pacifism, isola- 
tion and to stop us from arming, or from using the arms we 
have. 

Some of the lobby members identified on my 1931 chart 
are still on the job among your members, others have joined 
the lobby in recent years. 

The vindication of my forecast and warning ten years ago 
gives me the right and the duty to insist that the Senate must 
act now to destroy this lobby as a vicious and dangerous 
branch of the Hitler fifth column. Should any member of 
the Senate oppose such action now, ask him what he is try- 
ing to cover up. 

Senator Barkley thanked me profusely, promised to give my 
request his consideration and then retired to a hospital to re- 
cuperate. 

In agreement with me that the Farben lobby at Washington 
constituted the spearhead of Farben's subversive activities and 
of immunity for its allies, the Anti-Nazi League then joined in 
the attack, and began its own systematic effort to induce action. 



308 TREASON'S PEACE 

The Justice Department, Secretary of State Hull, and Secretary 
of the Treasury Morgenthau were among those appealed to by 
the League, unsuccessfully. 

One letter from the League, in July 1941, went to the Hon. 
Walter F. George of Georgia, then Chairman of the Senate For- 
eign Relations Committee. It referred to the activities of Farben 
affiliates in the United States and Latin America, and to the well- 
organized lobby at Washington by which "Congress is being im- 
properly influenced/' Therefore, wrote the League: 

For the sake of the integrity of American industry, and 
for the sake of national defense during the present critical 
time, we respectfully urge you to investigate this lobby. 

About that same time I also sent a letter to Senator George 
asking for an investigation of the Farben Lobby. The Senator's 
replies to these two separate requests for similar action were 
somewhat odd. He told the League that he thought the Judiciary 
Committee or the Justice Department should make any investiga- 
tion of that character, and that he understood the latter was so 
doing. He told me that he was referring my request to the Dies 
Committee. Thus the Senator covered up on our lobby investiga- 
tions demands, but he played fair, he called his shots and gave 
each peanut shell a name: Dies, Judiciary, and Justice. He must 
have forgotten there was a dead letter office. The latter would 
have served equally well. 

The League continued, as I did, to hammer away for investiga- 
tion of the Farben lobby but it was no use. The lobby did not 
choose to be investigated, and even after war was declared on 
the United States, all such appeals fell upon deaf ears. 

While world war II was under way there appeared on the na- 
tional scene a new organization which was called, aptly enough, 
"The Society for the Prevention of World War III." Many well 
known public figures were identified with this group and it has 
done yeoman work in publicizing the menace that is Farben, and 
in denouncing the plot to revive this threat to future world peace. 

In October 1941, on the theory that my 1931 diagrammatic chart 
had by then been sufficiently confirmed as to Farben's control 



TREASON'S PEACE 309 

of our national-defense industries, I sent a reprint of the chart 
to each member of the Senate and House with another urgent 
demand that my long-standing appeal for investigation of the 
lobby be granted. In that letter I said, in part: 

I suggest also that no one of you hazard the opinion that 
I merely guessed at the facts on my 1931 chart. Obviously 
I had, to know such facts to state them and not be jailed for 
criminal libel. 

Moreover that 1931 chart is now, in 1941, the irrefutable 
proof which Messrs. William E. Weiss, Earl I. McClintock, 
et al. cannot meet when they plead that they did not even 
suspect, years ago, just what were the subversive activities 
which their German associates were directing them to con- 
duct. If I knew these facts in 1931 then they knew them even 
before 1931. They are not that dumb. 

Again, silence in the halls of Congress. 

Later, I submitted to the Justice Department and to the Truman 
and Bone Committees of the Senate another appeal entitled "Ten- 
der of Proof" which outlined some of the evidence that supported 
the allegations on the chart. I again informed the Justice Depart- 
ment and the Senators that the significance of this chart was the 
obvious fact that its circulation, a decade previously, constituted 
irrefutable proof that those same facts must have been suspected 
or known by the American industrial and financial leaders who 
negotiated with Farben. 

In September 1941, Senator Connally, of Texas, who had suc- 
ceeded Senator George as Chairman of the Senate Foreign Rela- 
tions Committee, advised me that the Department of Justice was 
already investigating the lobby, so there was no need for his 
committee to do so. Then began one of the finest examples of the 
runaround that I have observed in a long experience with offi- 
cials who are afraid to say "yes" and hate to say "no." 

Accepting Senator Connally 's information as authoritative, I 
wrote Attorney General Biddle how happy I was to learn that 
he was at last investigating the Farben lobby, and would he please 
let me help. This was in the period when Tom Stokes and a few 



TREASON'S PEACE 

others were panning the daylights out of the Corcoran-Biddle 
weasel-worded consent decrees. Mr. Biddle, after due considera- 
tion, referred my letter to his subordinate, Mr. Arnold. Mr. Arnold, 
with his tongue in his cheek, referred me to his subordinate Mr. 
Sam S. Isseks, Harvard classmate of Mr. Corcoran, who had done 
the spade work at the funeral of the Sterling investigation. Mr. 
Isseks, after a brief interview, referred me to his subordinate Mr. 
Robert Wohlforth, ace investigator of the Antitrust Division, and 
former chief sleuth for several Senate Committees. 

Mr. Wohlforth, whom I had never previously encountered, as 
he had not been in on the current Farben mess, happily turned 
out to be too straightforward and forthright to play clown, no 
matter who ran the circus. After checking up to get his facts 
straight, Wohlforth gave me the first definite and clean-cut state- 
ment I had received from any public official in fifteen years of 
effort to get action on the lobby. Wohlforth's reply, condensed, 
was a courteous but firm "No." There was no lobby investigation 
in progress and there could be no lobby investigation started with- 
out orders. So that was that. 

To complete the record I sent out some letters headed Re: 
Lobby Employed by German I.G. Farben-Sterling Products, et al. 
These letters were as follows: 

Dear Mr. Wohlforth: 

Referring to conference with you on the 23rd instant re- 
garding the above subject, to discuss which I was referred 
to you by Mr. S. S. Isseks, I regretted very much your in- 
structions that no investigation would be made of the lobby 
employed by the German I.G. Farben-Sterling group. 

Under these conditions it would have been useless for 
you to have considered the information which I was pre- 
pared to present relating to this lobby but I do feel obliged 
to express to you my deep appreciation for your courtesy 
and forthright attitude. 

Dear Mr. Isseks: 

Referring to conference had with you on the 3rd. inst. 
.regarding the above subject I regret to inform you that Mr. 



TREASON'S PEACE 311 

Robert Wohlforth of your staff, with whom you instructed 
me to discuss this matter has informed me that no investiga- 
tion would be made of the lobby employed by the German 
I.G. Farben-Sterling group. 

Dear Mr. Arnold: 

Referring to your letter to me dated the 26th ultimo, re- 
garding the above subject I regret to inform you that Mr. 
S. S. Isseks of the New York staff, with whom you instructed 
me to discuss this matter has caused me to be informed that 
no investigation would be made of the lobby employed by 
the German I.G. Farben-Sterling group. 

Dear Mr. Diddle: 

Referring to my letter to you dated the 15th ultimo, re- 
garding the above subject I regret to inform you that Hon. 
Thurman Arnold, Assistant Attorney General, to whom you 
referred my letter has caused me to be informed that no 
investigation would be made of the lobby employed by the 
German I.G. Farben-Sterling group. 

Dear Mr. Chairman Connally: 

Referring to letter dated the 4th ultimo, regarding the above 
subject, in which I was advised that you considered action 
by the committee unwise because the Department of Justice 
was making an investigation of this matter. I regret to advise 
you that Hon. Francis Biddle, Attorney General, has caused 
me to be informed that no investigation would be made of 
the lobby employed by the German I.G. Farben-Sterling 
group. 

The Dies Committee also has indicated to me that it has 
no intention of making such an investigation so it would 
appear that some one deliberately misinformed you on this 
subject. 

In view of the above I again request that you bring to the 
attention of your committee my letter to yourself of August 
12 and the copy of my letter of July 18 to your predecessor 



$12 TREASON'S PEACE 

Senator George, also my open letter to the Congress dated 
October 6, all reauesting investigation of this lobby. 
Respectfully, 

H. W. Ambruster 

The pressure of events, or something, deterred the Senator from 
replying. 



CHAPTER XVII 



Alibis and Excuses 



FRANK A. HOWARD, 

who conducted so many of the negotiations with Farben, wrote 
his Standard Oil colleague E. J. Sadler, on February 6, 1940, that 
Germany's policy for fifteen years had been the exporting of 
patent rights, "resulting from their learning that, if they did not 
. . . x . . secure their exploitation abroad by appropriate deals, un- 
licensed competition would pirate the new processes, leaving 
the originators neither an export market nor anything to sell in 
the way of patent rights or technique." 

This comment illustrates the absurdity of the alibi that our 
industrialists entered into illegal agreements with Farben because 
they were f arsighted and, had they not done so, the United States 
would not have derived the great benefits from the Farben patents 
covering dyes, drugs, explosives, magnesium alloys, rayon, syn- 
thetic rubber, plastics, etc. 

These disingenuous sophistries have been broadcast most as- 
siduously by Farben's American cohorts since the exposure of 
the character of their agreements, and the resulting injury to our 
national defense. 

Possibly the most widely publicized of these excuses was the 

313 



314 TREASON'S PEACE 

so-called official press release already discussed in Chapter ix 
which was prepared by Tommy Corcoran and issued over the 
signature of Attorney General Biddle. This remarkable apology 
for a convicted corporation contains these words: 

Under this agreement (with Farben) many new and im- 
portant discoveries in the pharmaceutical field were disclosed 
to Winthrop Chemical, thus making them available to the 
United States. 

Another bit of excuse propaganda is found in one of the pam- 
phlets distributed in 1942 by Standard Oil, quoting allegations 
made by its president, W. S. Parish: 

whether (or not) the several contracts made with 

I.G. did or did not fall within the borders set by the patent 
statutes or the Sherman Act, they did inure greatly to the 
advance of American industry and, more than any one thing, 
have made possible our present war activities in aviation gaso- 
line, toluol and explosives, and in synthetic rubber itself. 

However, it is apparent that Farben's United States patents 
would have been valueless to the Germans had not agreements 
for their use legal or illegal been made with our industrialists. 
Otherwise, the patents could only have served as a means of pre- 
venting manufacture; and as such they would have constituted 
so glaring a repetition of German cartel practices prior to World 
War I that the inevitable result would have been a change in 
our patent laws. 

On the other hand, should Farben have refrained from taking 
out patents in this country, its new processes would have been 
available to our industries here as rapidly as they were revealed 
when the patents Were issued in Germany, and published. 

Farben's leaders knew all this, their American partners knew 
it, and the Government knew it. Nevertheless, the illegal unions 
were made and consummated. The Justice Department and the 
Congress twiddled its thumbs, and when our so-innocent indus- 
trialists asked for the know-how on some of the more important 
German patents they were told that it was "withheld for military 
reasons." 



TREASON'S PEACE 315 

One appeal to public opinion issued by duPont on January 6, 
1944, in part, was as follows: 

Surely it cannot be the policy of the Department of Justice 

to attempt to prevent the continuance of such immensely 

beneficial arrangements which have been a common practice 
in American industry. 

This plea referred to the announcement that another antitrust 
action had been filed involving duPont; in this instance with the 
British Imperial Chemical Industries and the duPont subsidiary, 
Remington Arms, also named as defendants. 

This statement was cleverly phrased; it contained allegations 
that the agreements had never been concealed and that 

copies have been in the possession of Governmental 

agencies for approximately 10 years. 

All this was unquestionably true. The same statement was re- 
peated in duPont's next annual report, but what may appear to 
have been an unfortunate omission, in each instance, was any 
mention of the fact that some of the restrictive agreements referred 
to in this antitrust action involved not only the British I. C. I. 
but also included tie-ups and financial partnerships with I.G. 
Farben subsidiaries making and distributing both commercial and 
military explosives. 

It was by repetitious publicity of this character that duPont 
escaped much of the press criticism that was heaped upon some 
of the others who were not involved in as many court actions for 
conspiring with Farben as was this oldest and largest of American 
munition makers. 

DuPont's public relations, since 1936, were handled by Herbert 
Hoover's former White House Secretary, the late Theodore G. 
Joslin, until he died in April 1944. Mr. Joslin knew his way around 
Washington and Newspaper Row. His public relations depart- 
ment contributed numerous terse press handouts, and, along with 
duPont's elaborate radio program, "Cavalcade of America" con- 
tributed effectively to the appeasement of public opinion. 

This publicity featured denials that duPont "ever has been a 
party to any cartel arrangement, using the term in its usually ao- 



316 TREASON'S PEACE 

cepted sense," or that the company ever had "any connection with 
the German company (Farben) of a nature detrimental to the 
United States." These denials may be considered merely as ex- 
pressions of opinion with the duPont definitions of the words 
cartel and detrimental still at issue. 

However one of the duPont radio pleas incurred an official 
rebuke from the Federal Communications Commission, which, 
in a report issued in March 1946, criticized that company as using 
"its commercial advertising period" to "explain one side of a con- 
troversial issue." 

The comments which were thus criticized were sandwiched in 
with interesting references to "Better Things for Better Living 
Through Chemistry" in a broadcast in January, 1944, during a 
period in which some hostile press comments were appearing re- 
lating to court actions which involved Farben's ties with duPont. 
The broadcast was a vigorous protest that the duPont agreements 
with I. C. I. had been of great benefit to the American people 
and to the war effort. 

Also naming numerous products which, it was admitted, duPont 
chemists had improved but which "came originally from abroad." 

Again Farben was not named although vague references were 
made to continental European companies, and mention of syn- 
thetic nitrogen and ammonia, plastics, rayon, dyes and cellophane 
may have caused listeners to believe that many vital products 
which in reality had been made in this country since the days of 
the first world war were actually the result of the benevolences 
which I. C. I. and the unnamed European companies had contrib- 
uted to America during the recent pre-war period. 

There was a defiant note of challenge in these duPont state- 
ments which ignored any suggestion that the benefits thus alleged 
could have been secured equally well without any questionable 
tie-ups with I.G. Farben. And little was said about those instances 
where, as will be revealed in the next chapter, the duPont com- 
pany pleaded nolo contendere, or agreed to a consent decree 
in cases involving Farben tie-ups. 

From across the Atlantic, Lord Harry McGowan, chairman of 
I. C. I. made several contributions to a friendly duPont press, with 
statements cabled through the press associations which termed 



TREASON'S PEACE 317 

such charges against his company "iniquitous." The noble lord 
declared that the cooperation between I. C. I. and duPont had 
been beneficial to both the United States and Britain, and formed 
a good pattern for post-war international agreements. 

In debate in the English House of Lords, both Lord McGowan, 
and Lord Melchett, another I. C. I. director, on occasion shouted 
defiance at the United States Department of Justice regarding 
the numerous instances in which I. C. I. was accused with duPont 
of tie-ups with Farben. Lord McGowan ridiculed as innuendo 
the news items which had appeared in the American press indicat- 
ing improprieties in any such relationships. He boasted that I. C. I. 
"is not indicted" for any breach of American law (which was 
hardly accurate ) and had not "done anything to be ashamed of," 
( which, being a lord, may have been true ) . Finally he announced 
that it would be time enough for the House of Lords to ponder 
the matter of Farben when and if Parliament should enact legis- 
lation against such relations. 

Undoubtedly the news and editorial comment in the American 
press which stressed duPont's relations with our British allies, 
the I. C. I., rather than the tie-ups with the German enemy, I.G. 
Farben, tended to soften public opinion towards duPont. That 
company's greatest triumph in public relations belongs in the 
next chapter. 

In 1941, when Sterling began getting hostile criticism in the 
press, a public-relations firm with special training to correct just 
such unfortunate situations was engaged. 

Baldwin, Beech, & Mermey, of New York City, was given the 
task a happy choice, as this was the outfit which had been sell- 
ing the public the idea that a rejuvenated McKesson & Bobbins, 
under many of the same old directors, was rid of all taint and 
odor of the fraud and criminal activities of its erstwhile guiding 
spirit, Donald (Musica) Coster. 

A glance at the earlier record of the firm of Baldwin, Beech, & 
Mermey indicates that its qualifications for the job were also 
well founded on experience which Mr. William Baldwin and Mr. 
Maurice Mermey had when they were retained in the late 20's 
to sweeten publicity in favor of a low tariff on sugar imports from 
Cuba. In this case the sweetening came from die Hershey Co., 



318 TREASON'S PEACE 

the Coca Cola Co., and an organization known as the American 
Bottlers Association. 

According to testimony given by Messrs. Baldwin and Mermey 
before the Caraway Lobby Committee in 1930, some rather weird 
methods were utilized in order to induce favorable publicity, 
called "legitimate news," some of which might indicate animosity 
in Cuba towards the United States. Commenting on the evidence, 

Senator Robinson accused Baldwin and Mermey of: 

^ 
Arranging to have cartoons published in these Latin - 

American newspapers, inflaming the sentiment against the 
United States. (Farben would have liked that as much as 
the sugar people.) 

So on the record, Baldwin, Beech & Mermey was well quali- 
fied to inject some sweetness and light into the sourness of the 
Sterling reputation. Its task was not an easy one, and, unhappily, 
news items continued to come out of Washington which were 
reminders of the close personal relations between the Sterling 
executives and the leaders of Farben. 

However, the agile press agents got to work and Sterling soon 
got some publicity which paid unqualified tribute to its reforma- 
tion and to its executive personnel, especially Messrs. McClintock, 
Rogers, and James Hill, Jr., who represented the old regime as 
well as the new. 

Two New York publications which gave space to favorable 
mention of Sterling (in February 1942) were The American Busi- 
ness Survey, a sheet devoted to articles praising various com- 
panies and individuals, and Printers Ink, long established organ 
of the advertising and publishing business. 

The articles in both of these publications praised the new Ster- 
ling set up. Printers Ink also praised its past and, rather oddly, 
appeared to credit Sterling with having secured for the medical 
profession such remedies as Salvarsan, Novocain and Luminal, 
all of which, it may be recalled, were introduced in the United 
States long before Sterling supposedly had any tie-ups with the 
Germans. American Business Survey talked about the "Monroe 
Doctrine puissant" and "cultural coordination" between the United 



TREASON'S PEACE 319 

States and Latin Americans induced by Sterling's anti-German 
drug drive. It was pretty bad. 

Reprints from both of these publications were distributed gratis, 
and with apparent liberality, but as none of the dodgers were 
handed to me, I called at the office of The American Business 
Survey to secure a copy. Only one individual was visible in the 
office a zealous gent who wanted to quote me prices on lots of 
a hundred or more. I got my copy, thanked him, and left. A few 
weeks later the Federal Trade Commission lit on the interesting 
"Survey" publication as a fake. 

Another disingenuous publicity stunt by which Sterling at- 
tempted to live down its Farben relations was the free distribu- 
tion through druggists and doctors of thousands of copies of a 
booklet entitled "Footprints of the Trojan Horse," which was 
originally published as a warning against fifth-column activities 
in the United States. This time it was handed out in the name 
of "The Bayer Company, Inc., makers of Bayer Aspirin/' It was 
a strange book for Sterling to circulate in the year 1942. 

When the adverse publicity of 1941 got under way, the trade 
and industrial press did everything in its power to convince the 
public that Sterling, Standard Oil, and other Farben affiliates had 
done nothing wrong in making tie-ups with the Germans, and 
that in any event the results had been beneficial to the United 
States. This was merely following the line of indirect apology that 
for many years had been held to in such journals as Chemical and 
Metallurgical Engineering, the McGraw Hill publication long 
accepted as authoritative in the industries. 

For example, back in May 1929, this publication had lauded 
the formation of the American I.G. Chemical Corp., and belittled 
its critics as hysterical. Again, in April 1942 its editorial made 
the preposterous accusation that it was Thurman Arnold's prose- 
cution of Farben affiliates that had obstructed our national de- 
fense supplies of magnesium, Buna rubber, and other strategic 
materials. 

In normal news channels Sterling fared a bit better than Stand- 
ard Oil, possibly because it escaped the Truman and Bone Com- 
mittee inquiries. These inquiries went sufficiently deep into Stand- 



320 TREASON'S PEACE 

ard's relations with Farben to cause its president, at that time, 
the late W. S. Parish, to attempt a public defense before both 
committees. Much of Mr. Parish's testimony was devoted to de- 
nials of the accusations that Standard had delayed synthetic rub- 
ber production in this country. This allegation, he stated before 
the Truman Committee, "has not a shadow of foundation/' How- 
ever, Mr. Parish appeared unable to explain, even to his own 
satisfaction, the long delay in getting the Buna program started. 
"I don't know what has caused the delay" he said at one point. 

In the ensuing discussion of the delayed rubber program, Sen- 
ator Connally, old Texas colleague of Mr. Parish, contributed this 
gem of official explanation and foresight: 

We were hopeful that we wouldn't lose the Dutch East 
Indies and hopeful that we wouldn't lose Malaya Who- 
ever, if any one, did it ( caused the delay ) was probably act- 
ing through motives they thought were wise and good mo- 
tives. 

Before the Bone Committee, Mr. Parish assumed an aggressive 
attitude and denounced the case which had been presented against 
Standard as "one sided." Senator Bone retorted hotly that he was 
fed up with that kind of defense from big outfits like Standard. 

When Mr. Parish alleged that Standard's relationship with Far- 
ben was severed by the so-called Hague agreement in 1939, he was 
forced to admit that there was still in existence a carry-over under- 
standing subject to later adjustment ( which means, of course, after 
the war ) . Mr. Parish then started to enlarge upon the thesis that 
"All of you know now of the enormous advantages to the public 
of our contracts with I.G. Farben." 

Challenged on this one by Mr. Creekmore Path, Mr. Parish re- 
plied plaintively, "We are human beings. In 1927 we could not 
foresee 1942." 

So it was made to appear that the master minds running the 
world's largest industrial organization, with agents in every coun- 
try, never even suspected that a war was in the making. 

As examples of die enormous advantages to America that had 
been brought about by the Farben partnership agreements, Mr. 
Parish listed the original process for producing 100 percent octane 



TREASON'SPEACE 321 

gasoline; the method of making synthetic toluol, the basic ingredi- 
ent of TNT; and Paratone, an improvement in lubricating oils for 
planes, tanks and ships. 

These generous tokens of Farben's esteem sounded good to 
some of the Senators until three of Mr. Parish's assistants gave 
their testimony. It then appeared that the products named by 
Standard's president had been perfected not by Farben, but by 
Standard Oil's own research men. 

An item of rather unfavorable publicity also developed when 
Professor Hunter, of the Justice Department, told the Bone Com- 
mittee that five Standard officials had made deliberate misstate- 
ments. Some of the discussion that followed was so heated that 
it was expunged from the record. 

Standard's efforts before the Senate Committees to excuse or 
vindicate its relations with Farben were supplemented with 
numerous press releases and circulars the latter distributed 
from filling stations and at employes' meetings. Informal talks 
before gatherings of all kinds were also in order. 

Robert Haslam, elected vice-president of Standard Oil and in 
charge of public relations, contributed vigorous articles and let- 
ters to the press defending his company's relations with Farben 
against what he termed sensational, unsubstantiated charges 
which painted a false and distorted picture. 

One Haslam article, which appeared in the Petroleum Times 
of London, England, on December 25, 1943, struck fire in an 
unexpected quarter no other than the headquarters of Farben 
at Frankfurt, Germany ( although this effect was not known in the 
United States until the war ended). Mr. Haslam alleged in this 
article that secrets brought to America from Germany had turned 
into mighty weapons against Germany. He then mentioned the 
same three developments which had been cited by Mr. Farish 
before the Bone Committee; high octane gasoline; toluol; and 
Paratone as having been secured from Farben. Apparently he 
did not remember that he was one of the three Standard scientists 
who, to the Senate Committee, had indicated opinions that Stand- 
ard, rather than Farben, had actually developed these processes. 

Mr. Haslam's article likewise indicated that America got Buna 
rubber from Farben. 



322 TREASON'S PEACE 

It did not take long for the Haslam alibi to get through to 
Germany, whereupon Farben's chief counsel, Dr. August von 
Knieriem, put his own experts to work picking flaws in the Haslam 
thesis with counter-claims that it was Farben and not Standard, 
that had all the best of it in the pre-war horse trading. 

Many valuable contributions, said the Farben boys, were re- 
ceived as result of their contracts with the Americans including 
lead-tetra-ethyl (gasoline); polymerization; improved lubricants; 
and finally, that it was through friendly relations with Standard 
that Farben had purchased large reserve stocks of aviation gasoline 
and lubricating oils for the German government just before the war. 

As for Iso-octane, said the Farben experts, Standards research 
men had recognized that long before they had any knowledge 
of the Farben process and it was Farben that got the best of 
the exchange of ideas on that item. And regarding toluol, the re- 
port went on, Mr. Haslam's talk of a miracle was all bunk. Ac- 
cording to the Frankfurt technicians, Standard did not use Far- 
ben's process as it already had all the toluol methods it needed. 

On Oppanol, or Paratone, again it was Standard's improvements 
that helped Farben. The retort on Buna rubber was emphatic 
Farben didn't give Standard anything important to war economy, 
and whatever maytiave been revealed in the patents America 
could have procured without any agreements as enemy patents 
in war time. 

Altogether, the Farben boys appeared to have shot Mr. Haslam's 
alibi and that of Mr. Farish full of holes. It will be recalled, too, 
that in Chapter xrv, Farben's Dr. Loehr admitted that his com- 
pany had undermined the military potential of the United States 
through its connections with Standard. 

However, the Haslam-Farish versions had wide circulation in 
the United States, and the Farben retorts did not. The result 
of Standard's publicity was a lessening of criticism. 

Other things, however, may have contributed. It was stated 
by Walter Winchell that in May 1942 a news broadcaster for CBS 
had been effectively silenced on the Truman and Bone Committees 
exposes. This man had included in the script of his broadcast 
mention of the accusations that Standard intended to resume ties 
with Farben when the war ended. The CBS censor killed the item 



TREASON'S PEACE 323 

and, it was reported, told the radio newsmen to "go easy on 
Standard, you know we carry plenty of their business." 

Harry S Truman, while still a Senator, paralleled that revealing 
incident with a public accusation that Standard, with huge gov- 
ernment contracts, was advertising at taxpayer's expense to coun- 
teract the fact that its tie-ups with Farben had materially retarded 
the development of synthetic rubber in America. 

The 1942 and 1943 stockholder's meetings of Standard at Flem- 
ington, N. J., were the occasions of spirited defense speeches by its 
executives. At both of these meetings a committee of minority 
stockholders, ably led by one William Floyd, II, and his attorney, 
Amos S. Basel, proposed queries and resolutions which appeared 
to embarrass mightily the Standard defenders. 

At the 1942 meeting Messrs. Floyd and Basel attempted in vain 
to put through a resolution requiring the Standard executives to 
answer "fully and adequately" the Senate Committee accusations. 
At the 1943 and 1944 meetings they tried again, unsuccessfully, 
to get Standard on record that it would not resume cartel relations 
with I.G. Farben after the war, unless the Government should 
desire it to do so. 

At the 1943 meeting President Ralph Gallagher, who had suc- 
ceeded to that office at the death of Mr. Farish, made the fantastic 
assertion that Standard "never had any cartel agreement with I.G. 
Farben." He then declined to reply to a question as to whether 
or not the Farben contracts would come into existence again when 
the war was over. 

Senator Kilgore, on the morning of the 1944 meeting, issued a 
statement at Washington calling attention to Standard's reluctance 
to make any commitment on post-war cartels. At the meeting Mr. 
Basel, raising his voice above the uproar which arose whenever he 
pressed the Standard-Farben issue, quoted the substance of the 
Kilgore remarks. Whereupon Mr. Haslam, his ire aroused, de- 
manded that Mr. Basel read the entire statement. "I will," replied 
the speaker, "if these people will keep quiet." The claque, for 
once, subsided. 

James Gerard, Ambassador to Germany in the first World War 
and financier of the Democratic National Committee, defended 
Standard's leaders at all of these meetings. In 1942 Gerard quoted 



324 TREASON'S PEACE 

Leviticus about the priest and the goat. In 1943 Mr. Gerard's 
contribution was of more serious import. Said he: 

I can assure you that some of us who are thinking over 
what is to happen after the war are contemplating universal 
cartels, and it may be that our own government will tell or 
even order our management to join some international cartel. 
At the 1943 Standard Oil meeting, approval was voted to a 
proposal of the directors to transfer permanently to the United 
States all of the Buna rubber patents. There were, of course, cer- 
tain provisions, but it was good publicity, only a comparatively 
few people knew that under the terms of the 1942 consent decrees 
Standard had already been forced to throw open its Buna patents, 
and that the Alien Property Custodian had already seized title to 
all of the Farben United States patents which allegedly had been 
transferred to Standard after the war started. 

While I did not attend the 1943 meeting, I did go to the one in 
1942 as proxy for a stockholder, and asked just one question: 

Mr. Parish, would you or the other officers of the company 
desire to state to this meeting the date when you first became 
convinced or suspicious that the activities of the German I.G. 
Farben in its relationship to Standard Oil of New Jersey 
were hostile to the national security of the United States? 

Mr. Farish, after some quibbling, declined to reply. "I don't think 
the question is proper," he said. 

So this challenge, which must go pretty close to the root of the 
matter, remains unanswered by Standard. Neither does it appear 
that the executives of duPont, Alcoa, Sterling, or any of the other 
Farben affiliates have ever stated the date when they first sus- 
pected that Farben's intentions might be hostile to the national 
security of their country. And yet this might seem to be a fair 
question one which any man would desire to answer. 



CHAPTER XVIII 



No Sacrifice on the Altar 
of Moloch 



DON'T THINK THAT 

you need prove how great the United States is by throwing 
it sacrifices. That was all right for the hideous God Moloch, 

but it would be intolerable if you or any (group) 

thought that they could add to the majesty and dignity of the 
United States by proving its power through an injustice. 

This moving appeal came near the close of a solemn address 
which, on June 20, 1945, in impressive surroundings at Newark, 
New Jersey, was listened to in respectful silence by a group of 
representative citizens, flanked by men high in official, industrial, 
and other circles important in the affairs of this nation. 

Leading up to his magniloquence about the Old Testament's 
God of War and Vice, the speaker had said: 

It would be a hideous, a monstrous, an unconscionable 
thing, if any of the rights of these defendants which I have 
outlined to you were neglected by you, or if any one of them 
should be sacrificed to the might and power of the Govern- 

325 



326 TREASON'S PEACE 

ment just to prove the Government's right and power. The 
Government of the United States asks no sacrifice of anybody 
to prove its might and greatness. The United States of America 
proceeds with majestic instancy towards that goal which has 
been marked for it by God Almighty, and it does not require 
any fictitious or factitious accretions to its greatness. It pro- 
ceeds along the path of justice and will not deviate from 
that path so long as it fulfills the will and intent of the Divine 
Creator who brought this country into being for its own un- 
measurably wise purpose. 

Thus did this modern Solomon picture to six men and six women 
in a jury box, the sacrificial blood of innocent victims staining the 
altar of that wicked God of the Ammonites, as a warning of the 
abomination that might be their verdict, should it be induced, 
mistakenly, by too great love for their native land or grief for the 
blood of their own sons and daughters sacrificed on a less high 
altar, erected by one of those named in the conspiracy to be judged 
by that jury, I.G. Farben, of Frankfurt-am-Main. 

Having been instructed also that the Government of the United 
States was entitled to a just verdict, the jury retired and ten hours 
later brought in a verdict of NOT GUILTY for the two corpora- 
tions and six individuals whose fate, for those ten hours, had been 
in their hands. 

I.G. Farben was not technically on trial in that case, having 
been accused merely as a co-conspirator, of conspiring with duPont 
and Rohm & Haas of Philadelphia, with eight of their officers, as 
defendants; along with two other co-conspirators, Imperial Chemi- 
cal Industries of England and Rohm & Haas of Darmstadt, 
Germany. 

As discussed heretofore in Chapter vi those named were accused 
of having entered into agreements to fix prices and restrain pro- 
duction and distribution of acrylic, or plastic, glass-like products, 
in violation of the Sherman Anti-Trust Law. 

One mystifying aspect of the trial was the dismissal of Counts 
2 and 3 of the indictment on motion of Walter R. Hutchinson, 
Special Assistant to Attorney General Francis Biddle, who repre- 
sented the Government. This left only Count 1 of the indictment 



TREASON'S PEACE 327 

at issue and confined the case to charges of violation of Section 1 
of the Sherman Act, forbidding conspiracies in restraint of trade. 
Whereas Counts 2 and 3 alleged also violations of Section 2 of 
the Sherman Act which forbids monopoly or attempt to monopo- 
lize. (It might be noted here that no explanation has been forth- 
coming of this apparent free gift to the defendants of immunity 
without trial under the specific charges in Counts 2 and 3. How- 
ever it is known that Mr. Hutchinson, who had just returned to the 
Justice Department from army duty overseas, was ill, and in no 
condition to have tried this case.) 

The Court, in its charge to the jury made certain the omission 
was understood and that: 

The second section, relating to monopoly, has been 

abandoned by the Government so that there remains 

for your consideration only the first count which is violation 
of Section 1 of the Sherman Act. 

The Court then made this astounding misstatement of the lan- 
guage and scope of Section 1 of the Sherman Act, as follows: 

Performance of an overt act to effectuate the object of the 
conspiracy is necessary to bring the combination within the 
ambit of the statute, because a conspiracy of itself, a combina- 
tion of itself, is not denounced by the statute unless there be 
something done to effectuate its purpose. 

This weird dictum being absolutely incorrect we may wonder 
how and why the Judge came to so inform the jury. 

The Court also appeared anxious that the jury be not led astray 
regarding the significance of a letter introduced by the Govern- 
ment and quoted a small part of this letter, which was from Mr. 
Haas of Philadelphia, U. S. A., to Dr. Rohm of Darmstadt, Ger- 
many, in 1936, about consultation on prices, as follows: 

A matter like this cannot be put into the contract because 
it would be against the law. 

Strangely, the Court did not feel called upon to quote the next 
sentence of that same letter, which was as follows: 



328 TREASON'S PEACE 

We have to rely on our verbal assurance and our experi- 
ences with duPont during the last fifteen years has proven 
that they can be relied upon to live up to an arrangement 
of this kind. 

Noticeable in the trial were the harmonious relations which 
prevailed between opposing counsel during the six weeks which 
were required to present the voluminous evidence to the jury. 
This love fest, so different from the cat and dog courtroom fights 
which frequently occur among counsel in a case of this type, 
caused the Judge to pay tribute to the "eminent fairness which 
has been exhibited by counsel for the defense and counsel for 
the Government/' Said the Court: 

111 pay my tribute to counsel because it has made the work 
of the Court so much easier 

One of the distinguished members of the bar whose nice court- 
room manners were thus complimented by the Judge, was the 
well-known attorney, Bruce Bromley, whose forensic snarls and 
sneers are famous. 

The Philadelphia Rohm & Haas, with its admittedly close ties 
to the Darmstadt firm and to I.G. Farben, was represented by 
Mr. Bromley, whose New York and Washington law firm of 
Cravath, Swaine and Moore (formerly Cravath, de Gersdorff, 
Swaine and Wood ) , had also represented Farbwerke Hoechst of 
Farben in several peculiar cases in the New York District Court 
against one of Herman Metz's companies, during the same period 
when Farben ( as discussed in Chapter n ) was paying Metz other 
large sums of money to turn over his drug and dye interests in 
this country to Sterling and General Aniline. 

It also may be of interest here to note that a few weeks later, 
on September 11, 1945, Hoyt A. Moore, Esq., of this same Cravath 
firm, was indicted by a Federal Grand Jury at Scranton, Pennsyl- 
vania, with former Federal Judge Albert W. Johnson and others 
on charges of conspiring to obstruct justice and defraud the 
United States Government. Judge Johnson resigned to avoid im- 
peachment and the House Judiciary Committee in February 1946 



TREASON'S PEACE 329 

turned in a report castigating the "corrupt connivance" of Mr. 
Moore and pointed out that the Cravath firm had charged over 
$125,000 for its services. 

Later the indictment of Hoyt Moore was dismissed by the Court 
on his plea at the Bar based upon the statute of limitations, be- 
cause the acts of which he was accused were all performed "more 
than three years prior to the date said indictment was found/* 

The Judge who tried the duPont Rohm & Haas case in 1945 
was the same jurist who had sealed the original indictment in 
August 1942, from public knowledge, during the period when 
five members of Senator Bone's Patents Committee were voting to 
forbid further investigations and hearings on the Farben tie-ups. 
This jurist was none other than Hon. Thomas F. Meaney, whose 
nomination for the bench in 1942 provoked a bitter fight in the 
United States Senate. During the final debate in the Senate it was 
the late W. Warren Barbpur of New Jersey who stated the issue as : 

Like Caesar's wife a Federal judge should be above 

suspicion Mr. Meaney cannot escape always being 

viewed as a pawn of Mayor Hague. 

And, the aged Senator George W. Norris, in one of his last im- 
passioned appeals denounced the Hague organization as a con- 
temptible, crooked, bipartisan machine, and the nominee as "one 
of his tools," whom Hague "is trying to put on the bench." Said 
the Senator "The confirmation of Meaney would be like putting 
Hague on the bench/' 

When the six men and six women brought in their verdict of 
not guilty in the trial of the duPont-Rohm & Haas-Farben tie-ups 
there came to an end the first, and as this is being written, the 
only case, in which American corporations and some of their 
officers, have been tried before a jury for alleged criminal con- 
spiracy with I.G. Farben. And, under our system of American 
jurisprudence, the record of acquittal stands that these corpora- 
tions and these men were not guilty of any unlawful act in having 
made the agreements with Farben and with each other, or in 
doing any of the acts alleged as unlawful by the Government. 

Nothing can better illustrate than this trial the failure of the 



330 TREASON'S PEACE 

enforcement of the antitrust laws to impose either punishment 
for past associations with Farben or warning against future re- 
newals of such affiliations. 

When the duPont-Rohm & Haas-Farben trial ended in so com- 
plete a fiasco for the Government and established so complete a 
vindication for Farben's partners, press statements appeared im- 
mediately credited to representatives of duPont in which the Gov- 
ernment's accusations were belittled with the allegation that 
"when the time came to produce supporting evidence in court, 
the prosecution was unable to do so." 

Thus a battle was fought, or staged, and lost in a New Jersey 
courtroom, against Farben, in those hectic weeks of May and 
June 1945, immediately after the armies and government of Ger- 
many lost their last battle, to surrender ignominiously and un- 
conditionallyand simultaneously the plot to revive Farben's Car- 
tel structure emerged, as announced in Washington by Senator 
Kilgore on June 21st, the day after the jury in Judge Meaney's 
court officially recorded the lawfulness of the duPont-Rohm & 
Haas-Farben alliance. 

In this case the result was at least a clear cut acquittal of the 
defendants. In some of the cases to follow the results, where there 
have been any and the lack of results in others, are so vague and 
indefinite that sabotage of government may not seem an unfit 
term to apply. 

We must go back to the direction of the Anti-Trust Division 
by Robert H. Jackson, for the initiation of the first Anti-Trust 
case in which was involved a tie-up with I.G. Farben, or rather 
with one of its international cartel alliances. This case was filed 
in 1937, against the Aluminum Company of America (Alcoa), its 
disowned Canadian offspring or counterpart, Aluminium Limited, 
and twenty-three subsidiaries, along with thirty-nine individual 
officers and others accused of unlawful monopoly in the produc- 
tion and distribution of aluminum. 

In this case Aluminium Ltd. was accused of direct participa- 
tion in the international aluminum cartel with Vereinigte Alumin- 
ium Werke of Bitterfeld, Germany, one of the I.G. Farben affiliates. 

The lower court in 1940 having found no unlawful monopoly 
existed, this judgment was reversed on March 13, 1945, by the 



TREASON'S PEACE 331 

Court of Appeals which ruled that Alcoa was in fact a monopoly 
and then returned the case to the lower court for further pro- 
ceedings. 

The participation of Farben's German affiliate in the interna- 
tional cartel received little attention in this celebrated case, but 
it is timely here to reveal that in aluminum, as in so many of our 
other important war materials, Farben had succeeded in a par- 
ticipation in restrictive cartel tie-ups reaching into this continent. 

The initial action involving Farben brought by the Anti-Trust 
Division under Mr. Arnold was that against Rudolph Ilgner for 
destroying Chemnyco records which was described in Chapter v. 
The Chemnyco records sought and destroyed had been demanded 
by a grand jury for the antitrust investigation of nitrogen and 
ammonia fertilizer materials which resulted in five blanket indict- 
ments; two of these named as defendants Farben's Synthetic 
Nitrogen Products Corporation, and its executives, including one 
Carl B. Peters as vice-president, along with numerous other Far- 
ben affiliates in the United States, Europe and South America; the 
affiliates as either defendants or co-conspirators. Mr. Peters is 
given special mention here because he makes a dramatic re- 
appearance in a later chapter. 

The American I.G., also Farben, and the International Nitrogen 
Cartel of London, which Farben organized to control and restrict 
the world's nitrogen production, were among those listed as co- 
conspirators. 

The several conspiracies which the Antitrust Division thus 
attempted to attack and which included the misuse of patent 
licenses, were those by which P'arben, careful not to appear 
reaching for control of nitrogen and ammonia as military products, 
attained its purpose by restricting world production of these vital 
materials through tie-ups in the fertilizer industries. 

However, these indictments, mysteriously sealed by the Court 
and hidden from the public for months after the grand jury acted, 
then all petered out. In June 1941, about the time when Attorney 
General Robert Jackson was kicked upstairs to the Supreme Court, 
Mr. Arnold backed downor was sat upon and his assistants 
began filing, in batches of a dozen or more, Nolle Prosequi entries 
which dismissed over one hundred charges against defendants in 



332 TREASON'S PEACE 

these cases. Thus were wiped out all criminal cases on the Far- 
ben conspiracy to fix prices and restrict production of synthetic 
nitrogen and ammonia. 

The public heard little of these cases, and in 1941 and 1942 
while the war was well under way, three civil complaints and 
consent decrees were filed covering these fertilizer materials. In 
these the Farben subsidiary, Synthetic Nitrogen Products, also 
Imperial Chemical Industries, duPont and Allied Chemical and 
Dye, with their leading officers, promised in profound legal lan- 
guage to refrain from doing in the future those acts of conspiracy 
which, in the same breath, they denied having done in the past. 
No trial, no publicity, no penalties; as the war-time answer to 
a Farben conspiracy which had restricted production of those 
keystones of chemical munitions in the pre-war era, nitrogen and 
ammonia. Carl B. Peters was also named in one complaint and 
decree involving Synthetic Nitrogen Products, which concern was 
listed among the co-conspirators in the other two civil cases. 

Mr. Arnold's next indictments against Farben conspirators were 
three filed on January 30, 1941, covering conspiracy in restricting 
production of magnesium metal and alloys through patent and 
process finagling, as described in Chapter rv. These knocked 
around until April 15, 1942, while a softening-up process was 
going on inside the Justice Department. Then all of the defendants 
except Farben and its two German directors, pleaded nolo con- 
tender e (which means "Oh, well, what if we did?) and paid fines 
of $25,000 each, for Alcoa, Dow and American Magnesium; 
$20,000 for Magnesium Development (half owned by Farben); 
$15,000 for General Aniline (also owned by Farben); and $5,000 
each for six of the corporation officials who were indicted. Of the 
latter Farben's Karl Hochswender, president of Magnesium De- 
velopment and of Chemnyco, had his fine graciously returned. 

Meanwhile Farben, with Hermann Schmitz, its president, and 
Gustav Pistor, one of its directors, have never been tried and un- 
doubtedly consider this whole affair a joke. Messrs. Schmitz and 
Pistor were busy in Berlin or Frankfurt a/Main making Farben's 
munitions and directing Farben's war against the United States. 
How they must have sneered when they heard the bargain price 
of $140,000, less the $5,000 discount, that was charged by the 



TREASON'S PEACE 333 

Yankee Court as total penalties for the injury to national defense 
caused by a woefully insufficient magnesium production when 
war broke out. 

Next antitrust cases relating to Farben were the nominal fines 
and consent decrees involving Sterling and its affiliates which 
have already been described in Chapter vm and elsewhere. It 
will be recalled that the fines in these cases totaled $26,000. How- 
ever if the attorney's fees were over a quarter of a million dollars, 
as it was rumored in the Justice Department, then it might seem 
that the bargain between the parties on which the consent decrees 
were based included pre-arranged penalties for Sterling of around 
$300,000-of which the United States Treasury was to receive 
$26,000, and some one else was to get the balance. 

Even though these consent decrees may have cost Sterling sev- 
eral hundred thousand dollars in huge fees exacted by Mr. Cor- 
coran plus not so huge fines exacted by the Court, yet this whole 
transaction may be said to have shown a nice net profit for Sterling. 
Because when the decrees were arranged it appears that there 
was due to Farben, from Sterling-Bayer under the profit-sharing 
agreements, the tidy sum of $544,000, which amount Sterling was 
permitted to retain in its own pockets. 

As events proceeded it may appear that as a result of the al- 
leged abrogation of the Farben agreements Sterling's profits were 
increased by a sum of well on to $1,000,000 annually, this being 
the share of the booty which prior to the consent decrees had 
gone to I.G. Farben. The United States Treasury appears as the 
real loser of these millions because the Treasury had already 
frozen all Farben funds, and after the Alien Property Custodian 
began seizing Farben's belongings ( some of them ) in 1942, these 
Sterling profits due Farben would have gone to the Custodian's 
bank account. If it were not for those consent decrees which Mr. 
Corcoran induced his Sterling clients and his friend Mr. Biddle 
to consent to. 

That Sterling appreciated the advantage of this war opportunity 
to retain these profits is shown by the fact that this company 
actually went into the Canadian courts in 1944 with a plea to 
set aside contracts in the Dominion between its subsidiary, the 
Bayer Company Limited, and Farben's Bayer. However, the 



334 TREASON'S PEACE 

Canadian High Court ruled that the monies owed by Sterling's 
Canadian Bayer to Farben's German Bayer must continue to be 
paid to the Canadian Alien Property Custodian. 

Another peculiar feature of these Sterling-Bayer-Winthrop- 
Farben criminal actions and civil consent decrees of 1941, is that 
although all agreements between Sterling and Farben were sup- 
posed to have been abrogated, this does not appear to be true. 
We need only to examine the records of the Securities and Ex- 
change Commission to discover two other agreements with Farben 
entered into by Sterling's British subsidiary, Bayer Products Com- 
pany Ltd., and its Canadian subsidiary Bayer Company Ltd. It 
was the latter of these two agreements which Sterling attempted 
to cancel in 1944 so as not to keep on paying the Canadian Alien 
Property Custodian. 

These two British and Canadian agreements were, as late as 
May 1945, officially hidden from public inspection by the Secu- 
rities and Exchange Commission where they were on file. In a 
letter dated January 31, 1945, the Securities and Exchange Com- 
mission denied inspection of these agreements on the allegation 
that they had been filed with the Commission by Sterling in 1936 
with a stock registration along with two other Farben contracts, 
with request from some unidentified person that they all should be 
kept secret. The Commission also refused to exhibit the request 
for this secrecy. 

However, on May 17, 1945, I was notified to appear to testify 
before a Senate Committee on a bill to require that all restrictive 
foreign trade agreements be registered before some Federal 
Agency; and by a strange coincidence the Securities and Exchange 
Commission decided on the same day that the still secret Sterling- 
Farben agreements could properly be made public "without objec- 
tion by the Sterling Company," said the letter. 

When we recall how painfully shocked and surprised so many 
public officials appeared to be after the Justice Department of- 
ficially discovered illegal agreements made years before with Far- 
ben and we then discover that at least some of them had been 
filed with an important official agency but on a pledge to hide 
them as trade secrets, we begin to wonder what kind of hocus 
pocus our Government really is. 



TREASON'S PEACE 335 

And when one department of Government publicly brands an 
entire group of these Farben tie-ups as illegal from the days when 
they were entered into, and a court so decrees in both criminal 
and civil actions, while another branch of the Government still 
keeps some of them hidden as lawful trade secrets, then it be- 
comes a burlesque of government. And by the same token we 
may accept this as a typical illustration of the pattern of I.G. 
Farben's activities within the fabric of this nation before the war, 
during the war, and as now revealed after the combat war has 
ended. 

Another antitrust action involving cartel tie-ups between Ster- 
h'ng-Winthrop and I.G. Farben, as set forth in Chapter III may 
be mentioned here to refute the idea that the 1941 consent decrees 
constituted a complete divorce between Sterling and Farben. 

In February 1944, the Anti-Trust Division intervened in a pat- 
ent infringement case in Illinois in which the Wisconsin Alumni 
Research Foundation was prosecuting another company for al- 
legedly violating the Vitamin D patents. The Government brought 
counter-charges of violation of the Sherman Act against Wiscon- 
sin Alumni and some sixteen of its licensees which were marketing 
Vitamin D in medicinal or food products. These included Win- 
throp; duPont; The Quaker Oats Company; Standard Brands Inc.; 
The Borden Co.; Parke Davis & Co.; E. R. Squibb & Sons; Abbott 
Laboratories and others. The intervention by the Government 
caused the court to enjoin Wisconsin Alumni from further restric- 
tive activities and the Vitamin D patents were thrown open to the 
public. However, the injunctive decree did not mention the 1928 
cartel agreement with Farben covering these patents. 

War had been declared only a few days before the next batch 
of Farben cases was ground out by the anti-trust boys with the 
able assistance of Joe O'Connell's Treasury raiders; this crop being 
three multiple indictments against General Aniline and Film, Gen- 
eral Dyestuff and I.G. Farben, along with numerous individual 
members of Farben's royal families and exiled employes. These 
cases have already been well discussed in earlier chapters. 

However there are several mysterious aspects of these three 
cases, which are still as this is written, postponed and untried and 
also disparaged as unnecessary in certain official circles. 



TREASON'S PEACE 

It may be recalled that I.G. Farben itself as well as its stooges, 
false fronts and errand boys, is a defendant in two of these cases. 
In the other it is merely called a co-conspirator. Farben did not 
answer "here," or "not guilty," in January 1944 when the others 
appeared to plead. Nobody would admit knowing who was Far- 
ben's official or legal representative in this country. So the summons 
was marked "Unable to Find." Then after an unsuccessful attempt 
to pin that honor on Mr. Hochswender of Chemnyco, the court on 
February 28, 1942, announced the appointment of William M. 
Wherry, Esq., as Special Master to determine the identity of Far- 
ben's agent in the United States. 

Unfortunately, the court appears still uninformed. More than 
four years later, as of May 16, 1946, Mr. Wherry had never had 
a copy of the order served on him, so he never was officially started 
on this ardous task. What became of the order the records do not 
show. 

After reading some of the chapters of this book the court and 
the Justice Department might be able to make several good 
guesses as to the identity of Farben's representatives in this 
country, especially as appearances for I.G. Farben were finally 
entered on the records of the Magnesium indictments by a well 
known New York law firm which came forward as Farben's legal 
representative in those cases. 

The local address of the chief villain still being an official mys- 
tery, and the General Aniline-General Dyestuff properties firmly 
in the custody of the Alien Property Custodian after being alleg- 
edly deloused of all Farben taint, a strange conflict inside the 
Government got under way with reports of urgent pleas from the 
Custodian's office that the cases be abandoned. (In which event 
the basic contracts with I.G. Farben would remain in effect, and 
a resumption of those ties after the war would be expedited. ) 

In one of these cases a demurrer was filed in the names of Farben 
itself and its two subsidiaries and several officers, including the 
celebrated overseas Schmitz brother team, Hermann and Dietrich. 
This demurrer presented the topsy-turvy spectacle of the Alien 
Property Custodian of the United States, who now controlled 
General Aniline, asking the Court to throw out as false, prepos- 
terous and unwarranted, indictments which had been handed 



TREASON'S PEACE 337 

down by a Grand Jury at the request of the Attorney General 
of the United States. 

Claims were made that the relationship of Farben and General 
Aniline being that of parent and offspring, it was silly to allege 
that they conspired by merely being nice to each other. One of 
those who filed this demurrer was the same Dietrich A. Schmitz, 
who back in 1938 gave his solemn oath before the Securities and 
Exchange Commission that he did not know who owned General 
Aniline (then American I.G.). Evidently Dietrich, by 1944, had 
discovered the surprising fact that its parent was big brother 
Harmann's I.G. Farben. 

The attorneys representing the Alien Property Custodian's man- 
agement of General Aniline and Dietrich Schmitz had still an- 
other reason why the case should be tossed into the wastebasket, 
arguing that it could not be against public policy for Farben to 
keep foreign chemicals out of the United States by private ar- 
rangement, because Congress did the same thing with the Tariff 
Act. 

These arguments were successfully met by Herbert A. Berman, 
Chief of the Patents and Cartel Section of the Anti-Trust Division, 
whose brilliant handling of such work was recognized as one of 
the bright spots in the Justice Department, until he finally resigned 
in disgust early in 1946. The Court threw out this demurrer on 
November 6, 1944, and a few days later in another branch of 
the same court all three of the indictments against D. A. Schmitz 
were dismissed. (As already discussed in Chapter v. ) 

So these three cases, in some respects the most important in- 
volving Farben and its huge American false fronts, remained un- 
tried while the war went on so as not to interfere with its conduct 
and, a year after the war was over, were still untried because one 
branch of the Government did not want another branch to en- 
force the law. If Farben's Schmitz, looking ahead before the war 
had planned it this way, could he have done it better? 

Another indictment accusing General Aniline and General Dye- 
stuff of conspiracy in the dye industry was filed in the New Jersey 
District Court on May 14, 1942; but in this instance Farben (local 
address still, unknown ) was named only as a co-conspirator. Those 
indicted included duPont; Allied Chemical and Dye; and Ameri- 



338 TREASON'S PEACE 

can Cyanamid; also Farben affiliates the American Ciba, Sandoz 
and Geigy. Some twenty officers of the corporate defendants, 
including Ernest K. Halbach and two of his Farben pals were 
also indicted in this case. 

The alleged conspiracy included world-wide restrictions in the 
manufacture, distribution, import and export of dyestuffs, stem- 
ming out of the international cartel set-up in 1928 in which co- 
conspirator Farben was the dominant influence. A long list of 
other co-conspirators included the Swiss Ciba, Sandoz, and Geigy 
companies with Cincinnati Chemical Works, their jointly owned 
American concern; Imperial Chemical Industries and its Canadian 
subsidiary; the French Kuhlmann; Japan's Mitsui; and duPont- 
I. C. I. branches in Brazil and the Argentine. In this case antitrust 
spread its largest net and landed speckled fish of many varieties 
and many nations. All had been gathered in Farben's net of the 
world's dye industry. 

When Secretary of War Stimson and Attorney General Biddle 
agreed to postpone the trial until it would not interfere with war 
production, one Justice Department official was quoted as saying 
sourly, "First they hurt the war effort by their restrictive prac- 
tices, and then if caught they use the war effort as an excuse to 
avoid prosecution." A tug of war went on under cover whether 
to compromise, dismiss or forget this case. Finally compromise 
won. In April 1946, after Tom Clark had become Attorney Gen- 
eral, the indictments were completely dismissed as to eleven of 
the defendants, including General DyestufFs celebrated Halbach, 
and were partially dismissed as to four of the corporations and 
eight of the other individuals named. At the same time pleas of 
nolo contender e (which is equivalent to guilty) were entered and 
the Justice Department notified the court that under these cir- 
cumstances it would not be in the public interest to stage a trial. 
No decree was entered by the court, so the contracts were not 
officially abrogated. 

The fines totaled $111,000 including four of $15,000 to duPont, 
Allied Chemical and Dye, General Aniline, and General Dyestuff. 
For the last two the procedure required the transfer of a fictitious 
bookkeeping item of $30,000 from one of Uncle Sam's pockets 
which the Alien Property Custodian used to another where the 



TREASON'S PEACE 339 

Attorney General's winnings are deposited. And Farben's agents 
who ran General Aniline and General Dyestuff went scot free, 
save for the American-born Rudolf Lenz, General Dyestuff vice- 
president, who was clipped for $5,000 fine on two counts. However 
Mr. Lenz ( as revealed in Chapter v ) was one of those paid off for 
his title to General Dyestuff stock in 1945. He got $47,200 for his 
share, so perhaps this fine did not make him feel too badly. 

We come now to the long delayed action against Standard Oil 
(N. J.) regarding which numerous threats of indictments had 
been heard prior to March 25, 1942, when a criminal information, 
a civil complaint in equity, and a consent decree were all filed 
on the same day involving Standard, six of its subsidiaries (in sev- 
eral of which Farben had an interest) and, in both criminal and 
civil actions, three of its executives, Messrs. Teagle, Parish and 
Howard. Four of Standard's lesser officers were also named in the 
civil action. 

The accusation in both the criminal and civil complaints was 
conspiracy by Standard, its subsidiaries and its officers, with I.G. 
Farben and others, in entering into and consummating restrictive 
partnership agreements, as were outlined in Chapter rv. For ap- 
pearances' sake Farben was named as a co-conspirator in both 
actions. Not being a defendant Farben need not consider itself 
bound by these Court actions. For each of the ten defendants in 
the criminal actions there were pleas of nolo contendere and 
a modest fine of $5,000. Thus the total payoff for the ten defendants 
was a mere $50,000 and, without admitting that the criminal acts 
had been done for which the fines were paid, another nice set of 
promises not to so act in the future were listed in the final judge- 
ment. 

If the reader thinks that these $5,000 bargain-day penalties were 
not commensurate with the offense charged, it may be stated here 
that just such an opinion was held very emphatically by some 
members of the Justice Department who had been sweating it 
out in preparation of this case. Some of them had demanded that 
multiple criminal indictments should be sought with fines totaling 
$1,000,000. 

It was claimed as justification for the Jack of punitive features 
in the outcome of this case that all of the patents in which Farben 



34O TREASON'S PEACE 

was involved, including those concerning Buna rubber, would be 
released by the consent decree royalty free to all comers for the 
duration of the war and six months afterward. 

However the Alien Property Custodian also signed the consent 
decree, having a few hours previously asserted the. Government 
claim to all of the Farben patents, to which Standard alleged they 
had acquired title through various Farben contracts, including 
the so-called Hague agreement. All these agreements now were 
declared by the court to have been unlawful when entered into. 
What the Judge's injunction did not say was that the decree was 
an attempt to lock the stable door long after the horses, and the 
harness and the hay, were gone. 

Among the many subsections of this consent decree were pro- 
visions regarding undiminished rights of Standard to patents, 
trademarks, and shares of stock, which inhibitions may appear 
strangely gentle when it is considered that the decree was pred- 
icated upon charges and tacit admissions, of criminal acts by the 
defendants. 

Later the purposes or results of some of the ambiguities in- 
serted in this decree were to become apparent. The court pro- 
ceedings may appear to have been neither punishment, parole, 
nor pardon. Rather they resembled absolution, or a rain check 
for a repeat performance after the stormy weather of war should 
end. 

As an aftermath of this case, and of the seizure by the Custodian 
of some 2,500 Farben patents and Farben or jointly-owned shares 
of stock, Standard began an intensive campaign of propaganda 
and excuses as described elsewhere, leading up to a court action 
in July 1944, which denounced the Alien Property Custodian for 
seizing patents and other property involved in the Farben agree- 
ments. 

Taking advantage of the ambiguities in the consent decrees 
and relying upon the transfer of title by the so-called Hague mem- 
orandum which Standard's Dr. Howard and Farben's Dr. Ringer 
negotiated after the war began, Standard asserted that the Cus- 
todian was actually obligated to disgorge all the seized patents 
and property. 

This came to trial without a jury on May 21, 1945, in New York 



TREASON'S PEACE 341 

Federal Court before Judge Charles E. Wyzanski, Jr., a bitterly 
fought contest between aged John W. Davis, former presidential 
candidate, as attorney for Standard, and a very able Assistant to 
the Attorney General, Philip W. Amram, for the Government. 

Judge Wyzanski dealt an almost fatal blow to the Custodian's 
defense at the start of the trial by holding in effect that it did 
not make a mite of difference whether the Farben patent titles 
had passed to Standard by unlawful contracts. This decision, with 
which some may not agree, was hailed with great relish by the 
Standard officials and lawyers grouped around Mr. Davis. 

However, Standard was not to have things all its own way. 
Frank Howard, by his evasive, forgetful, and contradictory testi- 
mony made what appeared to be most important contribution to 
proving Mr. Amram's contention that the so-called Hague agree- 
ment was a fake and a fraud. 

A surprise witness for the Government added a dramatic touch 
to the trial when Farben's director and Chief Counsel, Dr. August 
von Knieriem, was flown overseas in custody in an Army bomber. 
This Farben star witness on June 23rd testified in precise stilted 
English after clicking his heels, bowing to the Court, and ex- 
plaining that he needed no translator. His testimony was in con- 
flict with that of Standard's Mr. Howard. 

Among the interesting documents identified by von Knieriem 
were original letters taken from Farben's files at Frankfurt, prov- 
ing conclusively that Farben officials had been in continuous con- 
tact with the Oberkommando der Wehrmacht and high officials 
of the Nazi Government before and during the signing of the 
Hague agreement. It was evident from some of this correspond- 
ence that the transfer of title to Standard, after the war began, 
was purely a matter of expediency for the purpose of preventing 
if possible, their seizure as enemy property when the United 
States became involved in the war. 

Said one letter written by Farben to Nazi Defense Headquarters 
on September 16, 1939: 

German interests would not be jeopardized by the trans- 
fer Moreover we would be able to resume at any time 

without hindrance the relationship existing now. 



342 TREASON'SPEACE 

Said another dated October 5th. 

By this transfer the patents in .German possession 

will be removed from possible enemy seizure. 

We consider it right to transfer the patents to an American 
holder who is in friendly relations to us and of whom we 
know that in the future, as well, he will cooperate with us 
on a friendly basis. 

The Nazi Generals and Ministers replied O. K. to these naive 
proclamations of Farben's intentions to pull another fast one on 
the stupid Yankee Government with the friendly cooperation of 
Standard's Dr. Howard and his associates. "I do not raise objec- 
tions" wrote one. More careful, another Nazi official instructed 
Farben not to give Standard "inventions and experience data des- 
ignated as 'secret' by the Wehrmacht." Such letters were marked 
at the top "Secret" "To be kept under lock and key." 

But General Dwight D. Eisenhower's boys had rudely busted 
all the locks and brought both the letters and their custodian over 
the ocean to a Yankee court room. 

After studying the voluminous testimony and exhibits, Judge 
Wyzanski on November 7, 1945, handed down a lengthy "Findings 
of Fact and Conclusions of Law," along with an opinion which, 
so to speak, split the Farben patent hairs into two groups, giving 
back to Standard everything which they had prior to the attack 
upon Poland in 1939, and permitting the Custodian to keep all 
those which Standard had pretended to acquire at or after the 
Hague conference in September 1939. 

The so-called Hague memo was false and incomplete. 
Said the Court, "The falsity was of a type to mislead public 
authorities." 

Again he said: 

The so-called Hague Memorandum was neither an accu- 
rate summary of the past dealing nor a complete or 

faithful representation of the agreements made at the Hague. 

scrutiny of many documents and of the oral testi- 
mony of Mr. Howard reveals that the real agreement 



TREASON'S PEACE 343 

was subject however to an obligation to reconvey at 

the end of World War II or on demand of I.G. 

These findings of the Court were in decided conflict with Mr. 
Howard's testimony that there was no understanding "implied 
or expressed that these patents would be returned to Farben after 
the war." 

Judge Wyzanski in a series of judicial reprobations directed at 
the fabrications in the testimony of Standard's star witness left 
no doubt as to what he termed "the general impression as to his 
credibility which Mr. Howard made upon the court." 

Among the features of Mr. Howard's allegations under oath of 
which the court indicated disapproval were the latter's findings 
that the witness had failed to keep copies of various important let- 
ters, and notes of all that was said at the Hague conference, also 
that Mr. Howard's recollection was faulty on matters which the 
Court believed he should have recalled readily. 

This part of the Findings of Fact may appear as a painfully 
polite (it might be termed Courtly) way to record the fact that 
the Judge did not believe Frank Howard spoke the truth when 
under oath. 

Regardless of Standard's motives in slipping its neck into Far- 
ben's noose during the pre-war period, the record now stands 
in this decision that after the war began Standard made a fake 
agreement with Farben for the safe keeping of Farben's patents 
and other rights, with the purpose of returning said property to 
Farben and resuming the partnership when the war ended. 

The decision evidently gave complete satisfaction to neither 
Standard nor the Government, and rumors of contemplated ap- 
peals by both sides were heard, while additional proceedings were 
required in order to decide which of the 2,500 patents should go 
to which party under the decision. When legal hairs are split into 
2,500 pieces, the job of sorting them out becomes tedious. 

Another item, the metal molybdenum, important as an alloy 
for steel, was brought into the cartel picture by antitrust blood- 
hounds in August 1942 with a complaint and consent decree which 
named the sales subsidiaries of the Anaconda and Kennecott Cop- 
per Companies, Greene Cananea Copper, the Climax Molybden- 



344 TREASON'S PEACE 

um Co., and Molybdenum Corp. of America, as having conspired 
among themselves and with others unnamed in foreign countries, 
to divide up world markets, fix prices and quotas for this metal 
or its concentrates. 

Among those with whom the American molybdenum companies 
and Greene Cananea had international contracts were I.G. Farben 
and other European concerns, but Farben and the others were 
not named in the complaint, nor in the consent decree filed a few 
days later. The uproar about Farben was then at its height; in 
the Senate the Truman Committee had quietly diverted its atten- 
tion to other matters, and the squelching of Senator Bone's investi- 
gation was being consummated. Behind the scenes every particle 
of influence and pressure the Farben lobby possessed was being 
applied to hush the talk. So it may be that it was feared that de- 
fendants might refuse to consent to a consent decree without a 
court fight unless the name of Farben was omitted from the rec- 
ord. In the decree the usual "we never done it and we will not 
do it again" was duly entered and the curtain was rung down on 
this particular scene of the Farben comedy with only a hint that 
one of the blind alleys shown led to the Big House at Frankfurt. 

During the latter part of 1942, unseen hands firmly forced down 
the lid on further attacks on Farben's partners. Senator Bone by 
now had been forced to call off his fight. Thurman Arnold was 
about to quit, and the rapid succession of Farben indictments and 
complaints ceased for almost a year. 

Then in June 1943 antitrust again went into action against 
Farben with a lengthy indictment of National Lead Company, 
Titan Company and duPont, along with four of their officers, for 
having engaged in a world-wide cartel conspiracy with I.G. Far- 
ben and some twenty other foreign companies to restrain the pro- 
duction and distribution of titanium and titanium compounds. 
These pigments for the manufacture of paints, rubber, glass, paper 
and other articles are important in peace and are strategic war 
materials. National Lead and a co-conspirator, Titan Co. A/S of 
Norway, were accused of having started the conspiracy as far 
back as 1920, and the others of joining in it from time to time 
since that year. I.G. Farben entered the cartel in 1927, with con- 
trol of most of Europe, also of Japan and China. Imperial Chem- 



TREASON'S PEACE 545 

ical Industries, and Canadian Industries, the latter jointly owned 
by I. C. I. and duPont, were among the co-conspirators. 

Trial of this indictment being postponed for the duration (and 
not having occurred as this is written), a civil complaint, which 
called for neither fine nor imprisonment was filed, on June 24, 1944, 
covering the same titanium cartel conspiracy and the same de- 
fendants and co-conspirators that were listed in the criminal case, 
including Farben. 

After trial of this civil complaint without a jury, Judge Simon 
H. Rifkind's decision found National Lead and duPont guilty 
of conspiracy with I.G. Farben and others. However, the final 
decree in this case was criticized rather caustically by the Anti- 
trust Division in an appeal to the higher court. In effect, the appeal 
complained that even though Judge Rifkind found the defendants 
guilty, the punishment or remedy as proposed was insufficient. 
The defendants also appealed. ' 

One of the law firm of Cravath, Swaine and Moore representing 
duPont proposed to Judge Rifkind that it could not be a lawful 
function of the courts to rule that an American company should 
renounce the advantages which had been gained by its competi- 
tors through membership in an international cartel. The Court 
squelched this impudent suggestion that duPont should not be 
penalized, with the comment that "perhaps the answer is that 
duPont having discovered the conspiracy should have asked the 
Attorney General to break it up." 

Thus Judge Rifkind gave an apt answer to the alibi that so 
many poor innocent American industrial leaders were really com- 
pelled to join Farben's cartels and thus help Farben hamstring 
our war industries. 

Another cartel civil complaint on January 6, 1944, involved 
duPont, Imperial Chemical Industries of England and New York, 
and duPont-controlled Remington Arms, as defendants, along 
with five of their executives. Named as co-conspirators were two 
German makers of explosives controlled by Farben, and other 
companies jointly owned by duPont and I. C. I. in Canada and 
Latin America. Farben also had an interest in some of the latter. 

While this complaint was mainly directed at cartel agreements 
covering explosives, as described in Chapter rv, it also covered 



346 TREASON'S PEACE 

the widest range of chemical products of any of the preceding 
anti-trust actions in a series of comprehensive tie-ups between 
duPont and I. C. I. In substance the complaint alleged that the 
program of I. C. I. and duPont enabled the former to enter into 
numerous agreements with European chemical manufacturers 
for world cartelization of the chemical industry. Thus it was 
charged that a gigantic Anglo-American pool had been formed 
of the most important chemical products for peace and for war, 
from acids to alkalis, from solvents to synthetics and were 
tied together with other lines stretching out from I. C. I. or 
duPont to Farben. As this is written the case is still untried. Per- 
haps it never will be or perhaps another consent decree will result. 

Next to feel the threat of court restraint for being in a tie-up 
involving Farben were a group of thirteen of the leading alkali 
manufacturers of the United States, two export associations and 
the I. C. I. of England, also the latter's New York subsidiary. These 
were named as defendants in a civil action filed in New York in 
March 1944 for allegedly misusing the Webb Pomerene Export 
Trade Act to take part in foreign cartel alliances. The conspiracy, 
it was alleged, unlawfully divided up the world markets for alka- 
lis. Farben was named as co-conspirator (as usual) along with 
Solvay Process ( owned by Allied Chemical and Dye ) , its Belgium 
namesake Solvay et Cie,"and the German-owned American Potash 
& Chemical Co., which had been in the hands of the Alien Prop- 
erty Custodian since 1942. This was the first such suit involving 
the export act, 'and the defendants made an unsuccessful appeal 
to the Supreme Court to have the case dismissed without trial. 
Having failed to secure relief they waited trial. They are still 
waiting. 

Another civil complaint filed on May 1, 1944 against the Dia- 
mond Match Company, six other American match makers, and 
three British, two Swedish and one Canadian companies who 
were accused of world-wide cartel conspiracy to restrict competi- 
tion in matches. This stemmed out of the original American match 
trust of 1880 and included after World War I a peace treaty with 
Sweden's notorious international swindler and suicide, Ivar Krue- 



ger. 



International Match, a holding company, Krueger's bankrupt 



TREASON'S PEACE 347 

company, Krueger & Toll, and Krueger himself, although dead 
were named as co-conspirators. In this case the dead were to 
tell tales if they would kindly wake up. 

Farben came into this picture through an arrangement made by 
one of its predecessor companies for the restriction of production 
in the United States of chlorate of potash, a very important in- 
gredient in match making, and in war munitions. 

American production of this war material had been discontinued 
and the plants scrapped when World War II began. This experi- 
ence precisely duplicated the fix this country was in when German 
imports of chlorate of potash were cut off during World War I. 

On April 9, 1946, co-conspirator Ivar Krueger not being pres- 
ent, a consent decree dissolved the cartel and also forbade sup- 
pression of what is known as the everlasting match which can be 
struck thousands of times so they say. 

A year was to pass before another alleged Farben anti-trust 
plot was hauled into Court, after mysterious delays inside the 
Government. On May 16, 1946, the International Nickel Company 
of Canada and its wholly-owned namesake, both located in New 
York, with three of their officers, were named as defendants in a 
civil action accusing them of cartel price fixing alliance with Far- 
ben, and illegitimate aid to German re-armament. 

Why action on this alleged conspiracy with Farben had been 
delayed has not been explained as a tight situation on nickel had 
long been a matter of common knowledge and consideration in- 
side the Justice Department. Perhaps the delay may have been 
influenced by the fact that among the directors of International 
Nickel was none other than that celebrated Republican statesman 
and adviser of high Democratic officials, John Foster Dulles, of 
the law firm of Sullivan and. Cromwell. This is not to suggest that 
Mr. Dulles would have interceded for one of his companies with 
the Justice Department; rather it is possible that someone inside 
the Government may have believed that it would be poor taste 
publicly to hold up to scorn a company of which Mr. Dulles was 
a director and I.G. Farben a partner. It will be interesting to 
follow this case to its conclusion should there ever be one. 

The sixteen groups of prosecutions summarized above, which 
include thirty separate court cases, do not comprise all such ac- 



348 TREASON'S PEACE 

tions which involve some tie to Farben. But they are sufficient 
to reveal the utter lack of appropriate punishment which has re- 
sulted in the belated efforts of the Government of the United 
States to utilize our anti-trust laws for chastising Farben and its 
associates for injuries done to our national security. 

Statistics may be unreliable in appraising matters of this kind 
but it is of interest that in the fifteen cases which were based on 
criminal indictments the penalties provided by statute, which 
might have been inflicted on the corporate and individual de- 
fendants should they have been found guilty, would total almost 
four million dollars in fines and, for the corporation executives 
indicted, over four hundred years in jail. 

What actually resulted were fines totaling $323,000 and no jail 
terms whatever. 

Perhaps it would be more fair to omit the one criminal case 
which resulted in acquittal of the defendants; even then the ^ 
possible penalties in the other fourteen would be over three and 
one-half million dollars along with almost four hundred years in 
jail. 

In the fifteen civil actions, four were consent decrees which 
followed fines imposed in criminal actions; and in eight others the 
Government also won complete or partial victories. But in the 
civil actions no penalties were possible under the law. 

It is worthy of note that more than half of the criminal indict- 
ments have never been tried. And the fact that so many of them 
have been dismissed without trial leads to an inescapable conclu- 
sion that either those indictments should not have been sought 
in the first place or else each of them should have been submitted 
to a jury long before this. 

I.G. Farben, indicted five times, and with its German subsidi- 
aries, named twenty four times as co-conspirators, has never yet 
been tried. However its American subsidiaries General Aniline 
and Film, and General Dyestuff have each pleaded Nolo Conten- 
dere, or Guilty, in at least one criminal case, as have each of 
Farben's leading American associates, including Allied Chemical 
& Dye; Aluminum Company of America; American Cyanamid 
Co.; duPont; Standard Oil; and Sterling-Winthrop-Bayer. The 



TREASON'S PEACE 349 

fact remains that the only criminal anti-trust action involving 
Farben to reach a jury resulted in a verdict of not guilty. 

This much must be said for the small band of junior attorneys 
in the Anti-trust Division who under the leadership of Herbert 
Berman, dug out the facts and prepared most of these cases in- 
volving Farben. 

The existence of most of these Farben tie-ups was not a secret, 
as has been shown elsewhere in this story, but it required this 
belated official recognition of their illegality and menace to our 
national defense, to awaken public indignation and provide the 
facts on which three Senate Committees could act. 

These committees, headed by Senators Truman, Bone and Kil- 
gore, which began their hearings in 1941, 1942, 1943, could have 
made very little headway without the great mass of evidential 
documents provided by anti-trust, some portions of which were 
thus made public before the committees were choked off. 

Public access to this data appears as the only tangible result 
from the drag hunt so bravely started by antitrust when the war 
in Europe was getting under way. 



CHAPTER XIX 



Behind America's Iron Curtain 



"CONFIDENTIALLY, 

it stinks," said Senator LaFollette. It was April 24, 1942, more 
than four months after Pearl Harbor. The Wisconsin Senator was< 
expressing his opinion before the Senate Patents Committee of 
the failure of the Justice Department to punish the affiliates of 
I.G. Farben who conspired to obstruct production of defense 
materials, and its neglect to require full disclosures of the know- 
how of the patented processes thus obstructed. 

Thurman Arnold, Assistant Attorney General, had been making 
a half-hearted defense of the consent decrees in the Standard and 
Alcoa-Dow cases, as having been the best which the department 
could obtain under the circumstances. 

However, it was apparent from Mr. Arnold's testimony on this 
occasion, and previously before the Truman Committee, that he 
did not wish to make public exactly what circumstances, or whose 
intercession had caused the Justice Department to give in to the 
offenders after ample evidence had been uncovered for criminal 
prosecution for conspiracy and interference with the war effort. 
Mr. Arnold admitted that he had been faced with a "take it or 
35 



TREASON'SPEACE 35 1 

leave it" attitude in dealing with the Farben affiliates and that 
when he "took it" he agreed to fines, which he considered inade- 
quate punishment, and to terms in civil consent decrees which 
he conceded did not properly supply the know-how on the pat- 
ents which had served as pass keys in the illegal tie-ups with 
Farben. 

While Mr. Arnold was before the Patents Committee he had 
ample opportunity to reveal to the Senate and the public the rea- 
sons, and the influence which caused him to consent to what 
amounted substantially to immunity for those who had conspired 
with Farben to obstruct our preparations for war. Mr. Arnold, 
however, chose not to volunteer such information, and the Sena- 
tors who were questioning him chose not to press the questions 
that would have compelled him to do so. Senator LaFollette con- 
tented himself with his jibe at the odor of the situation, and Sen- 
ator Bone with comments that anyone who had withheld tech- 
nical knowledge and vital necessities from his country at such a 
time "was not decent" and "has no business in this country/' 

Mr. Arnold, in testifying later before the Bone Committee and 
elsewhere made no secret of the fact that he was not in accord 
with the postponement of the other prosecutions which he had 
instituted against Farben affiliates in plastics and other munitions 
industries. Nevertheless he had meekly consented to them on the 
ground that it would interfere with the pursuance of the war to 
prosecute those accused of conspiring to obstruct our prepara- 
tions for the war. 

It was not mere rumor in Washington that Thurman Arnold 
resigned as anti-trust chief in March 1943 because of dissatisfac- 
tion (honest rage might better describe it) with what seems to 
have been pseudo-legal sabotage of his efforts to eradicate Far- 
ben's industrial sabotage of this nation. 

Be that as it may, when the appointment was tendered him, 
the chunky frame of the Assistant Attorney General bounced un- 
gracefully down the steps of the Justice building, and found dig- 
nified repose a few blocks away in the U. S. Court of Appeals 
of the District of Columbia where, as Mr. Justice Arnold, he 
could at least write his own decisions. No obstructions were placed 
upon Mr. Arnold's departure. The Senate held no hearing on the 



352 TREASON'S PEACE 

confirmation of his appointment. "My friends didn't require a 
hearing/' he told me at the time, "and my enemies were only too 
anxious to get me out of the Justice Department/' 

Mr. Arnold is honored for the things that he started out to do, 
rather than criticized for the things he did not do; and his ad- 
mirers regret that he did not state in public the conclusions which 
he expressed so fluently in private about why his efforts had failed 
so dismally to put the fear of God into Farben, and its American 
accomplices behind bars. 

As the reader may by now have concluded, always it has been 
largely this official policy of "hush hush" that has made Farben's 
subversive activities possible. After the war began and revelations 
of those activities began to come out, it then helped provide im- 
munity for the individuals involved. 

On Feb. 11, 1942, when these very facts were tumbling out, 
when public indignation was mounting and Washington was 
seething with rumor about efforts being made to protect certain 
individuals who were involved with Farben, the following letter 
was received by the Speaker of the House of Representatives: 

Office of the Attorney General 

Washington, D. C. 
Honorable Sam Rayburn, 
The Speaker, 
House of Representatives, 
Washington, D. C. 
My dear Mr. Speaker: 

I desire to call your attention to the advisability of a law 
to protect the contents of secret or confidential Government 
records and documents from unlawful disclosure. 

Under existing law, it is an offense unlawfully to conceal, 
remove or destroy any record, paper, or document deposited 
with any public officer of the United States (U. S. Code, Title 
18, Sec. 254 ) . It is likewise an offense for any person who has 
custody of any record or document to conceal, remove or de- 
stroy it (U. S. Code, Title 18, Sec. 235). There is no prohibi- 
tion, however, against furnishing copies of or divulging the 
contents of secret or confidential files or documents. It would 



TREASON'S PEACE 353 

be advisable in the best interest of the public business, and 
particularly in the interest of national defense and internal 
security, to make it a criminal offense to disclose confidential 
Government information without authority to do so. 

Accordingly, I recommend that enactment of legislation 
to make it a criminal offense for anyone without authority 
to divulge the contents of secret or confidential Government 
documents. 

A proposed bill to effectuate this purpose is enclosed here- 
with. 

.1 have been informed by the Director of the Bureau of 
the Budget that there is no objection to the presentation of 
this proposed legislation to the Congress. 
Sincerely yours, 

Francis Biddle, 

Attorney General 

Provisions in the proposed bill which Mr. Biddle's letter trans- 
mitted caused the Chairman of the Senate Judiciary Committee 

to state that, "It is more or less a censorship bill We will 

have hearings." 

Attorney General Biddle appeared before a sub-committee of 
the Senate Committee on February 24, and denied that the bill 
would be a curb on the freedom of the press, but he conceded 
that its censorship powers might be utilized by officials who de- 
sired to escape criticism for their acts. 

Kenneth G. Crawford, then Washington bureau chief of the 
newspaper PM and chairman of the censorship committee of 
the Washington Newspaper Guild, testified that the bill, if enacted, 
would empower a bureaucrat to stamp as "confidential" docu- 
ments relating to a scandal in his department and thus prevent all 
publicity. 

On February 28, 1942, 1 addressed to the Chairman of both the 
Senate and House Judiciary Committees a protest on the bill's 
provisions and requested that I be permitted to testify against it. 
My letter said in part: 

There is something very fishy about the way this so-called 
official war secrets bill has been trotted out just at this time, 



354 TREASON'S PEACE 

when it is no secret in Washington that those influences which 
were spending time and money without limit to retard our 
entrance into combat war prior to Dec. 9, have since then 
merely gone underground with their treasonable efforts to 
hamstring our war effort and to protect their spokesmen from 
punishment. 

I suggest that your committee should plumb to its muddy 
depths the origin of this bill. When you find out who actually 
conceived the infant, and uncover who induced its adoption 
by the amiable Mr. Biddle, I suggest that you may also un- 
cover certain subversive individuals or groups who still ap- 
pear able to obtain a mysterious immunity from investigation 
and prosecution, an immunity which constitutes a distinct 
menace to our national unity and to our national defense. 

This bill is not merely an attack upon the freedom 

of the press, it is also an attack upon the freedom of any 
American citizen who may hereafter join in a demand that 
our long-delayed effort to preserve our future liberties must 
be purged of individuals whose past records prove them 
unworthy of trust in this crisis. 

This bill, if passed, would make it a criminal offense for 
me to offer to state to your committee, under oath, my knowl- 
edge of corrupt protection of subversive agencies from inside 
government departments. This bill would make it a crime 
punishable by jail for me to reveal the fact that members 
of Mr. Biddle's own staff have already threatened to resign 
because they have been ordered to discontinue investigation 
of influential subversive individuals, and that some of these 
men have been threatened with reprisals because of having 
revealed these protests. 

It would also attempt to make it a crime for any public 
official to resign, and publicly protest because of protection 
and immunity which criminal or subversive individuals may 
be receiving while we are engaged in war. 

I trust that your committee will permit me to testify be- 
fore it to support the above with greater detail. It may be 
obvious that the writer, a private citizen who possesses neither 
political nor any other kind of influence, may not make such 



TREASON'S PEACE 355 

statements as above unless he is either prepared to prove 
them or to go to jail. Mr. Biddle would very properly order 
me locked up tomorrow if what I have said here is either 
untrue or unjustified, or is impelled by unpatriotic motives. 

The chairman did not reply, but able and upright Senator 
Warren R. Austin advised me that he had added my name to 
the list of witnesses to be called. In acknowledging receipt of the 
Senator's letter on March 9, 1943, I outlined the testimony I in- 
tended to present if called before the committee as: 

A summary of the numerous alleged official secrets which I 

have encountered in recent years regarding each of 

which I have already demanded investigation and action. 
And in each instance there has been indicated a secret power 
and influence to provide official secrecy and immunity. 

Although many of these cases involve what might be termed 
ordinary crimes and criminals, there are certain of them which 
also involve subversive and fifth-column activities, and in 
nearly every instance the secret immunity granted is related 
directly or indirectly to the activities of individuals acting as 
agents, representatives, or attorneys receiving compensation 
from, or under direction of, either a foreign political organiza- 
tion or a domestic organization subsidized by a foreign cor- 
poration or government. 

I suggest that there is no use whatsoever in passing any 
more laws about protecting official secrets for national de- 
fense as long as every Tom, Dick and Harry who has a friend 
or an accomplice planted in some government department 
can walk in and see what he wants, or can phone and have 
it brought to his side door. 

I think that it is a matter of plain common sense, for our 
urgent self-protection in this crisis, that the first thing the 
Congress should do is to identify and demand prosecution of 
these official-secret fixers, including the author of the original 
bill as presented. The least that should be done is to run these 
rats out of the nation's capitol, and keep them out until the 
war is won. 



356 TREASON'S PEACE 

Chairman Hatton Sumners of the House Judiciary Committee 
wrote me that if hearings on the bill were held I would be advised. 
That was the last I heard about that official-secrets bill; it died 
in Committee when the 77th Congress ended, and was not rein- 
troduced in the 78th. 

However its significance appears in the source and time of its 
inception. The failure of this bill, with its threat to officials who 
might talk, did not, however, end the profound silence by Gov- 
ernment officials on matters relating to Farben and its affiliates 
a silence which extended to matters of public record. 

In March 1943, I sent to the office of Earl G. Harrison, then 
Justice Department Commissioner of Immigration and Naturaliza- 
tion, a lengthy list of individuals involved in the activities of I.G. 
Farben. This list included executives and employes of Sterling, 
Winthrop, Bayer, and Alba, who had been removed as undesirable; 
and other American citizens who had been indicted or kicked out 
of General Aniline, General Dyestuff, Agfa Ansco, Magnesium De- 
velopment, Synthetic Nitrogen, Chemnyco and other of Farben's 
ersatz American fronts. My request for information about the in- 
ternment, de-naturalization or deportation of these Farben stooges 
was met with the response that the Immigration and Naturaliza- 
tion office was forbidden to discuss the subject. Also, that no copy 
of the regulations on which that refusal was based could be 
supplied. 

Addressing Assistant Attorney General Wendell Berge, then in 
charge of the Criminal Division, I requested: 

Which if any of the 53 individuals named on my list have 
ne-naturalization or other court proceedings pending, wlu'ch 
involve the revoking of their citizenship? 

Which if any of those named has been interned? 

Which if any has had any other type of criminal pro- 
ceedings instituted against them? 

If no such proceedings are now completed or pending, 
what is the reason why people who have been engaged in 
subversive and other criminal activities are not being prose- 
cuted? 

Receiving no reply I wrote again asking why those individuals 



TREASON'S PEACE 357 

on my list who had been involved in activities inimical to our 
national defense had not been indicted and prosecuted under 
the conspiracy statute for interfering with the functions of the 
government. My letter continued, in part, as follows: 

I have asked this question of the Justice Department more 
than once in the past and I have been advised more than 
once in conversations with members of the staff (who had 
sought my assistance in this Farben mess ) that they agreed 
with me that such prosecutions for conspiracy to obstruct 
the functions of the government offered the most effective 
way to proceed against certain individuals because it obvi- 
ated the necessity of utilizing any of the statutes relating 
directly to subversive acts 

Why are men of this stripe immune? Is it because of their 
political influence? 

The only reply to either of these letters was advice that the 
Assistant Attorney General was not permitted to reply to my 
queries. The reasons for not prosecuting Farben criminals were 
"deemed confidential/' 

The lack of action under the conspiracy statute against two 
decades of pre-war plotting could have been justified if the anti- 
trust actions against Farben's accomplices had resulted in heavy 
penalties of fine and imprisonment. But not one of these offenders 
has gone to jail, and many of the most conspicuous among them 
have been immunized from prosecution with the official excuse 
that to try them would interfere with the prosecution of the war. 

We may ponder how it could have interfered with the prosecu- 
tion of the war to lock up these indicted gentlemen from Germany, 
at least for the duration? Or why such matters have been none of 
the public's business? Or why not try them after the war? 

It should be noted that in numerous other cases naturalized 
German nationals of little or no importance have been rightfully 
stripped of citizenship on the circumstantial evidence that they 
must have had mental reservations when they took the oath of 
allegiance to the United States and then joined a German-Ameri- 
can Bund. As compared with the subversive activities in which 
some of these immunized Farben gentry have taken part as mem- 



358 TREASON'S PEACE 

bers of our* higher cartels, membership in some guttersnipe Bund 
is indeed small potatoes. 

A special War Policies Unit of the Justice Department took 
over enforcement of the statute requiring the registration of 
foreign agents when this was transferred from the State Depart- 
ment in 1942. Publication of lists of all those registered as alien 
agents was then discontinued. 

My request for information as to what prosecutions had been 
instituted against agents of Farben or of Farben's affiliates for 
failing to register brought the response that no such proceedings 
had ever been instituted against any such Farben agents. 

I then supplied the War Policies Unit with a list of individuals, 
lobbyists, lawyers and law firms, which included some of Farben's 
most important agents, and requested advice as to whether any 
or all of those named were registered as agents of foreign princi- 
pals. The response indicated that the only one of those listed had 
ever been registered as an agent of I.G. Farben. He was our friend 
Rudolf Ilgner, the Farben employe who, as told elsewhere, pleaded 
guilty in 1941 to destroying files and records of Chemnyco, Inc., 
and got off with a token fine of $1,000 instead of a jail sentence. 

The official reason given by the Justice Department as to why 
none of the others listed by me were required to register was 
that their activities were regarded as "non-political" and confined 
to "bona fide trade and commerce." This seems a rather strange 
reason for not requiring the registration of individuals who are 
known to have been involved in criminal conspiracies, and in 
subversive activities here and in Latin America activities which 
in some instances at least the courts have held did not constitute 
bona fide trade and commerce. 

According to House Majority Leader, John W. McCormack, 
the Foreign Agents Registration Act was the most important 
legislation of its kind to pass in the last fifty years, and was en- 
acted as result of efforts of the 1934 Committee of which Mr. 
McCormack was chairman. This was the committee that publicly 
exposed some of the Farben-Nazi propaganda of super press agent 
Ivy Lee and others, but locked and sealed other evidence secured. 

When, in July 1945, Tom C. Clark succeeded Francis Biddle 
as Attorney General it was stated that the latter's antitrust 



TREASON'S PEACE 359 

policies would be continued ( which might have meant more than 
was intended). Later Mr. Clark announced publicly that there 

would be "strict enforcement but no witch hunting," and 

following this the new Attorney General was quoted as stating 
that civil actions were sufficient in cases where "a certain industry 
practice, operated openly for years, is a violation of Sherman Act 

it does not seem fair under such circumstances to institute 

criminal prosecutions." 

On the basis of the long-standing history of the Farben tie-ups 
in this country, and the fact once denied, but now proven, that 
most of these illegal partnerships were common knowledge, this 
pronouncement from the new head of the Department of Justice 
did not offer much encouragement to those of the staff who really 
wanted to put some of Farben's criminal associates behind bars. 
Subsequent to these indications of a soft post-war enforcement 
policy, several Anti-Trust resignations, long deferred under the 
Biddle regime, were handed in. What was aptly described by 
Mr. Clark himself as a "political anti-trust system" was now in 
order. 

The hush-hush policy on Farben and its affiliates has not been 
confined to the Justice Department. Ominous when considered in 
their relation to events to come are some of the matters involving 
the office of The Alien Property Custodian. 

Leo T. Crowley, shortly after he qualified as Custodian in 
March 1942, informed the Senate Patents Committee of his inten- 
tion to seize all enemy-owned patents which had been assigned to 
American holders when such patents had placed restrictions upon 
American industries, and particularly those which might impede 
war production. 

Despite this gratifying declaration, it was not long before mem- 
bers of the Custodian's staff were at loggerheads with officials of 
other departments because of the gentle treatment of the Farben- 
Sterling-General Aniline- Winthrop-owned patents. The Secretary 
of the Treasury announced his right to define as a foreign national 
any person, even an American citizen, who was found by the 
Treasury to have been acting directly or indirectly for the benefit 
of, or under the direction of, an enemy country. 

From these two pronouncements it would appear that it had 



360 TREASON'S PEACE 

been the intention of both the Secretary of the Treasury and the 
Custodian to seize the Farben patents held by such companies 
as Sterling, whose agreements were illegal conspiracies. Such pat- 
ents would be seized under the precise language of the 1926 
Supreme Court decision (referred to in Chapter xvi). 

On the basis of fact and of law the only explanation for the 
refusal to seize the property and patents of the Sterling- Winthrop- 
Bayer-Alba group may well be found in the reports that certain 
of Mr. Crowley's staff failed to agree with their chief's policies, 
and got away with it while he was otherwise engaged. 

It so happens that the same member of the Custodian's staff 
who first advised me that there was no intention to break the 
Winthrop-Atabrine monopoly also pronounced the fantastic con- 
clusion that there was no intention to seize any property which 
had German ties or control in cases where the possibility existed 
that the former owners might recover the property by court 
action after the war ended. 

Another member of the Custodian's staff when asked what 
pledge of continued American ownership was being exacted from 
those to whom seized properties were sold, replied by asking what 
was the use of such a pledge in view of the fact that after the 
war was over the Germans could come over again and buy back 
any property they had a mind to. (Just as they did after World 
War I.) 

Later it developed that the Custodian's office had not adopted 
the rules for the sale of seized properties that were in effect in 
the first World War, and which required a very real pledge of 
permanent American control with penalties for violation. So it 
seemed that in this war, properties controlled by Farben or by 
Farben's allies need not always be seized, and if seized and later 
sold, all such foolishness as pledges of permanent American control 
might be dispensed with. 

The rules finally adopted when sales of seized property got 
under way, required the purchaser to state that he was an Ameri- 
can citizen or a foreign national who had complied with all regu- 
lations; also that no one ever connected with the office of Alien 
Property Custodian had any interest in the bid, and that no 
agreement with respect to the purchase had been made with an 



TREASON'S PEACE 361 

undisclosed principal or with anyone on the Government's 
blacklist. 

On April, 1945, these regulations were apparently waived when 
the Alien Property Custodian sold the Farben-General Aniline- 
owned 50 percent of Winthrop Chemical for some $9,500,000 to 
Sterling, of which company Earl McCHntock, a former attorney 
in the office of the Alien Property Custodian in the first World 
War, was a director and vice-president. 

Sterling was required to deposit the purchased Winthrop stock 
with the Custodian in a ten-year voting trust to ensure that until 
1955 it would not get back into Farben's clutches, as the Bayer 
Company did after World War I despite Sterling's promise not to 
permit this. Unless of course the Alien Property Custodian should 
decide to release the voting trust or Farben's Swiss I.G. Chemie 
should upset the whole apple cart by getting back title to General 
Aniline through a phony act of Congress or a phony judicial 
decision. 

Great uncertainty has been manifest as to the administration 
and ultimate disposition by the Custodian's office of the General 
Aniline and Film Corp. after that very valuable property was 
taken over from the Treasury by Mr. Crowley in March, 1942. 

Little official information was forthcoming about the affairs 
of the company save that the Custodian's office was operating it 
as trustee for the foreign-held (Farben) shares, to which the 
Custodian had taken title. 

However, early in 1943 reports appeared in the press that an- 
other new board of directors for General Aniline was to be ap- 
pointed, several of them being directors or business affiliates of 
Standard Gas & Electric Co., of which Mr. Crowley, in his spare 
time, was the $50,000 (or was it $75,000?) a year president and 
chairman. Then came an announcement that the Custodian pro- 
posed to sell at public auction some of the more important prop- 
erties seized, including General Aniline. This was followed by a 
statement that the announcement had been an unfortunate error. 

Finally a new board for General Aniline was appointed, mainly 
of men having no experience in the dyestuff, photographic, or other 
chemical industries. 

Tom Stokes, in the Scripps-Howard newspapers, took his usual 



362 TREASON'S PEACE 

jab at the situation with the remark that Mr. Crowley was a triple- 
job man with two government titles and one in private industry. 
Stokes then added a hasty reminder of what happened during the 
Harding Administration: 

The office of Alien Property Custodian is considered here 
to be extremely important. This same office was investigated 
after the first World War with some unpleasant results. 

In July, 1943, when Mr. Crowley received a fourth job as head 
of the Office of Economic Warfare, replacing Vice-President Wal- 
lace, it was reported that he would take a leave of absence from 
his public-utility presidency, but for the time being would retain 
his other government titles. However, he still held on to his 
Standard Gas jobs and salary. 

It appears a proper comment to make that in the Custodian's 
office, as in other agencies dealing with Farben and its affiliates, 
there existed a vaguely defined line-up of those who wanted to be 
gentle with Farben and with Farben's friends as opposed to those 
who wanted to turn on the heat. And between those two extremes 
the play-safe brigade moved whichever way the wind blew. 

Regardless of the power of the lobby in peacetime, it is almost 
unbelievable that such a condition could exist when the United 
States was actually at war. On the record, however, nothing re- 
lating to Farben is unbelievable. 

In March 1944, when Mr. Crowley stepped out as Alien Property 
Custodian to devote more time to his expanding duties as the 
President's Foreign Economic Administrator, and his assistant, one 
James E. Markham, who was also a salaried director of Standard 
Gas & Electric, stepped in to succeed him as Custodian, it was 
reported on reliable authority that another man who was recog- 
nized as much better qualified through long experience had actu- 
ally been decided upon to succeed Mr. Crowley until outside 
intervention at the White House caused the appointment of 
Mr. Markham. 

The situation regarding General Aniline and General DyestuflFs 
continued with conflicting reports that they would or would not 
be sold, and with no change in what might be termed the strange 



TREASON'S PEACE 363 

clemency toward former important employes under the Farben 
regime. 

Not only Mr. Halbach, as previously mentioned, remained on 
the payroll of General Dyestuffs at a very fancy annual stipend, 
but two of the others who recovered sizable sums for their stock 
in General Dyestuffs were still listed in the Directory of Direc- 
tors for 1944 as executives: R. Lenz, as Vice-President, and A. T. 
Wingender, as Treasurer. 

These were all among the group described by Mr. Markham 
in his December, 1944, affidavit before the General Dyestuff stock 
suits were compromised, as having acted "in behalf and for the 
benefit of I.G. Farbenindustrie, a national of an enemy country, 
Germany," and as having held that stock as part of the "compli- 
cated threads of a conspiracy extending over many years and 
involving persons in many different countries." 

The Alien Property Custodian seized more than 44,000 foreign 
patents, some 32,000 enemy owned, mostly German. Licenses, 
free save for a $15 fee, were granted to all comers on several thou- 
sand of these patents but a difficulty about the free grants was a 
reservation by the Custodian of a right to revoke any license 
which provision hardly encouraged heavy investment to operate 
under such patents. 

However, the numerous General Aniline patents, also enemy 
owned, were not included in the $15 free license offer, despite 
the recommendations of the President's Committee on Foreign 
Economic Policy, which was approved by him, that these General 
Aniline patents should be licensed like the others, free to all comers. 

Request made to the Custodian long after the war ended for 
information about these licenses was referred to General Aniline; 
whereupon Mr. George W. Burpee, its president by designation 
of the Custodian, was emphatic in declining to consider granting 
any free licenses and his company patent counsel advised that 
the title to all of these Farben patents might still be clouded by 
the claims of I.G. Chemie, Farben's Swiss hideout, to ownership 
of General Aniline itself. 

Meanwhile the distinguished patent attorney, William H. Davis, 
under retainer from General Aniline, protested publicly that it 



364 TREASON'S PEACE 

y 

would be most unwise to open up these patents to all comers be- 
cause that "futile method" had failed after the last war whereas: 

the situation would have been quite different if the 

American patents had held by a strong competitive organiza- 
tion in this country, able and willing to enforce the German 
patents against them. 

This illogical thesis of Mr. Davis disregards the historical fact 
that after the last war the thousands of seized German dye trust 
patents which were turned over to Francis Garvan's Chemical 
Foundation for licensing to American firms did not get back into 
German control, whereas those which were sold to what Mr. 
Davis might describe as "two strong competitive organizations," 
Sterling and Grasselli, and which appeared "able and willing to 
enforce the German patents against them," did exactly the oppo- 
site. 

As will be recalled, some of these drug patents and all of the 
dye patents were later handed over to the partial or complete 
ownership of General Aniline-Farben- American I.G. 

Mr. Davis must have been hard pressed for an argument when 
he made his plea for exclusive retention of the Farben patents 
by General Aniline, the management of which apparently still 
fears, or believes, that Farben's fake Swiss title may some day 
restore Farben's control of this enemy property. In the words of 
the poet, whatever there is concealed in this patents woodpile, 
the odor is suspiciously like some of those of the 1920's when 
Frank Garvan was being called names for not turning all of the 
dye trust patents over to one or two strong organizations like 
General Aniline. 

Perhaps nothing could better illustrate the peculiar attitude 
of the Alien Property Custodian's office than an incident in 1945 
when request was made to inspect some thirty-seven claims which 
had been filed with the Custodian demanding return of various 
items which had been seized. These claims had been listed merely 
by number and name of claimant in the annual reports of the 
Custodian, and it was stated in the 1944 report that full publicity 
was given to all activities of the "Vested Property Claims Com- 
mittee" by which the justice of all such claims was decided, and 



TREASON'S PEACE 365 

that "the records of the committee are also open to the public." 

Despite this, the official secretary of the office of the Custodian 
refused to permit inspection of these records until after vigorous 
protest, and even then inspection of only one out of the thirty- 
seven was reluctantly permitted. The balance was kept under lock 
and key on the mumbo-jumbo explanation that the attorney for 
the Custodian still had them and therefore they were not public 
records. 

The real point of this incident may be found in the fact that 
substantially all of these particular claims had been filed by in- 
dividuals or corporations who had been either accused, convicted 
of or who had pleaded guilty to violating the laws of this country 
in their relations with I.G. Farben. Several were convicted crim- 
inals. 

Press criticism of Mr. Crowley's conduct of his various positions, 
especially that of Alien Property Custodian, appeared from time 
to time. These were usually based on the conclusion that he held 
too many titles, official and private, and had too many duties to 
do justice to all of them, or that his relations with Victor Emanuel 
( to whom he owed his large salary from Standard Gas and Elec- 
tric) were incompatible with his official duties. 

Perhaps the best way to permit the reader to consider the fair- 
ness of these criticisms, and without any reflection upon the good 
faith and patriotism of Mr. Crowley, or of Mr. Emanuel, would 
be to refer directly to the records of the Securities and Exchange 
Commission of January 19, 1943 when that official agency issued 
its Findings and Opinion that certain private banking firms were 
affiliates of Standard Power and its affiliate Standard Gas and 
Electric, and therefore there could not be the "arms length" trad- 
ing between them that the Public Utility Holding Company Act 
required in certain transactions. 

Among the firms involved in this opinion were Schroder, Rocke- 
feller & Co., Inc., an affiliate of the J. Henry Schroder bank of 
New York and London; and Emanuel & Co., of New York, in 
which Mr. Victor Emanuel was a partner. 

In a voluminous statement of the ramifications of control of 
the Standard Companies, and of the reorganizations of Standard 
Gas under the Bankruptcy Act, the Commission discussed the 



366 TREASON'S PEACE 

" close relationship between Emanuel and the Schroder 

interests" and concluded that "The Schroder interests in Lon- 
don and New York have worked with Emanuel in acquiring 
and maintaining a dominant position in Standard affairs." 

The findings also showed that Leo T. Growley replaced Emanuel 
as Chairman of the Board of Standard Gas in 1939 when Emanuel 
became Chairman of its finance committee, also that James G. 
Markham was then elected a director of Standard Gas. 

Just for good measure it might be added here that the cele- 
brated Cravath law firm appeared in the Securities and Exchange 
Commission case referred to as counsel for one of the banking 
firms who were found to be too close for "arms length" dealings 
with Mr. Emanuel's Standard Gas and Electric. 

That Mr. Crowley should be obligated to Mr. Emanuel and 
the J. Henry Schroder bank for the high salary he received dur- 
ing his tenure of public office (for which he is said to have refused 
compensation) may appear unusual and, insofar as is recalled 
such a situation had been seldom, if ever, duplicated at Washing- 
ton. 

An aspect of this which has provoked comment is the fact that 
the J. Henry Schroder bank acted as financial agent for the Nazi 
Government just prior to the start of the war and also was re- 
ported to be a financial backer for one of the firms in Farben's 
international nitrogen cartel: also the London Schroder had close 
business and family ties with the notorious General Kurt von 
Schroeder, of the Stein Bank of Cologne, Germany, that particular 
member of the Schroeder clan having been one of the strongest 
financial links between Hitler and his Farben industrial backers. 

By another coincidence, Sullivan & Cromwell, the law firm of 
John Foster Dulles (advisor to Mr. Crowley as Custodian and 
Counsel for General Dyestuffs stock claimants), is also reported 
to be counsel for the Schroder bank; and Allen W. Dulles, brother 
of John Foster and a member of that law firm, likewise is one 
of the directors of the J. Henry Schroder bank. 

It may be stated possibly in extenuation of Mr. Crowley's too 
numerous duties, that he has not been the only man holding high 
place in official Washington who appears to be under rather def- 



PEACE $67 

inite obligations to Mr. Victor Emanuel while at the same time 
wielding very considerable official powers. 

Among others reputed to be indebted to Mr. Emanuel for vari- 
ous private directorships is the former hotel manager George 
Edward Allen who, while drawing approximately $50,000 a year 
from numerous corporations and acting as a "public relations 
man" for private interests had been holding down various Gov- 
ernment jobs including a desk in the White House. 

Mr. Allen was appointed by President Truman to be a Director 
of the Reconstruction Finance Corporation with the chairmanship 
in prospect. He was confirmed by the Senate on February 18, 
1946, after a bitter debate in which Mr. Allen was accused of 
knowing nothing about banking by his own testimony, and of 
having been made a director of numerous corporations through 
his friend Victor Emanuel and the latter's friend, Alien Property 
Custodian James Markham. 

These directorships included the General Aniline and Film 
Corporation and the Hugo Stinnes Corporation, both controlled 
by the Custodian. Unfavorable newspaper criticism of some of 
Mr. Allen's activities, by PM's omniscient I. F. Stone, which were 
read into the Senate record caused Senator Bilbo to praise Mr. 
Allen's family as Mississippi's best, and Senator Scott Lucas to 
defend Mr. Allen vigorously. This Illinois statesman in 1942, as 
member of the Senate Patents committee, had voted to halt Sena- 
tor Bone's investigation of the I.G. Farben tie-ups, and in 1946 he 
was chairman of the committee on contingent expenses which 
voted to cut off the funds for Senator Kilgore's investigations of 
the conspiracy to revive of I.G. Farben. 

Said Senator Lucas in denouncing the critics of Mr. Allen: 

Who is going to pay any attention to speculation 

as to the influence which George Allen might have upon some 
one in Washington with respect to I.G. Farbenindustrie. 

So Mr. Allen then became director of the Government's multi- 
billion dollar lending agency. 

This is not to imply that Victor Emanuel or the Schroders 
wielded improper influence upon any Government official. 

Unhappily, many leading financiers and industrialists in this 



368 TREASON'S PEACE 

country, patriotic and wise according to their lights, who have not 
been directly involved with Farben, have seen no wrong in the 
part played by Farben before and during the war, or in a revival 
of Farben's world cartel system after the war. These beliefs and 
this policy not being the officially announced creed of the United 
States, it may be regarded merely as a matter of judgment (sim- 
ilar to the issue raised by Justice Jackson against Justice Black), 
as to whether the two men who, as Alien Property Custodian, 
have had the direction of General Aniline, General Dyestuffs, and 
other Farben properties, should be so friendly to Mr. Emanuel 
and the Schroder banking influences. And it may be of no sig- 
nificance that Mr. Emanuel and several of his associates have been 
appointed by them to the Board of Directors of these seized enemy 
properties, which, vastly increased in size and financial strength, 
are still holding intact the patents received from Farben and refuse 
to throw them open to all comers with the excuse that the legal 
ownership of General Aniline & Film is still claimed by Farben's 
Swiss I.G. Chemie. The latter now disguised under the so innocent 
name "Society of International Industrial and Commerce Partici- 
pation." 

Investigation of the conduct of the office of the Alien Property 
Custodian under Mr. Crowley, and under Mr. Markham, has been 
threatened more than once, and in one instance actually started. 

The Federal Deposit Insurance Corporation under Mr. Crowley 
also has been criticized severely, once back in 1942, when a reso- 
lution was proposed in the House of Representatives to investigate 
the F. D. I. C. because of heavy advances made to bankrupt banks 
in Jersey City, the baliwick of New Jersey's Democratic Boss. 
Mayor Hague. Other complaints have been registered because 
Mr. Crowley's F. D. I. C. attempted to collect huge sums for 
alleged liquidating expenses from officers of banks which had 
paid off 100 percent of the bank's obligations after having been 
ordered closed for unexplained reasons. 

Finally, in July 1945, a Senatorial investigation was begun after 
severe criticism of the handling of the American Bosch Company 
by the Alien Property Custodian (this being a repetition of the 
seizure of the predecessor of this company during World War I ) . 



TREASON'S PEACE 369 

A Senate sub-committee conducted a fact-finding expedition into 
Alien Property Custodian affairs but refused to make public its 
findings when request was made to the committee for same. 

One important key to the situation in the Custodian's office was 
supplied in an interview with members of the staff in October 
1942, when I had been officially requested to supply certain in- 
formation relating to Farben. In the hectic conference which fol- 
lowed, I finally mentioned with some skepticism that part which 
Mr. Corcoran was reported to be taking in the affairs of the Alien 
Property Custodian. This comment met with an immediate chal- 
lenge. However, other members of the staff were anything but 
enthusiastic about Mr. Corcoran's cooperation. 

Meanwhile the nearest approach to investigating the Farben 
lobby or Mr. Corcoran developed late in 1941, when Senator Carl 
A. Hatch introduced a bill to restrain former government employes 
from receiving fees for such lobbying activities for two years after 
leaving office. This bill caused some talk and died in committee. 
The lobby did not approve. 

Then came the Truman Committee lobby hearings in Decem- 
ber 1941 (Chapter ix) at which Mr. Corcoran declined to talk 
about his Sterling-Farben activities and fees, and was informed 
that he would be recalled later to tell the committee all about it. 
Mr. Corcoran was not recalled and he did not return. After a 
number of unsuccessful efforts to induce this committee to permit 
me to testify before it, I sent its chief counsel, Hugh A. Fulton, in 
April 1943, a reminder of the committee's intention to recall Mr. 
Corcoran, and asked whether the reappearance of the Sterling 
consent-decree expert had been required. 

Mr. Fulton's reply was a bit childish; he requested a memoran- 
dum on the subject ( I had already sent the committee a dozen or 
more memoranda and letters relating to Mr. Corcoran), and also 
made the strange allegation that: 

The Committee does not have the facilities for complying 
with private requests, such as yours, for analysis of material 
in the committee files. 

Conceding freely the great value of work which the Truman 



370 TREASON'S PEACE 

Committee and its counsel Mr. Fulton may have done on many 
other matters relating to the war, this Committee apparently lost 
interest in the Farben tie-ups in the United States after its par- 
tial expose of the Standard Oil arrangements on Buna rubber and 
other products. It was Senator Bone's Patents Committee that 
later did attempt to explore all of the Farben tie-ups until halted, 
allegedly through the efforts of Mr. Corcoran. 

In view of Mr. Fulton's effort to twist the plain meaning of 
my letter and his refusal to explain why Mr. Corcoran had not 
been required to reveal his activities relating to the Farben-Ster- 
ling drug tie-ups, it may be proper for me to recall that Mr. Ful- 
ton's legal experience prior to entering government service was 
gained as a junior attorney with the New York and Washington 
law firm of Cravath, de Gersdorff, Swaine and Wood, now Cravath, 
Swaine & Moore, which firm, and its predecessors, as discussed 
in Chapter xvin for many years had been the legal representative 
of Farben's German Hoechst and Farben affiliates in America. 

Mr. Fulton may also recall that in 1939, after he had become 
executive assistant to John Cahill, United States Attorney of New 
York (who was later attorney for Sterling), when I called upon 
him to discover if possible what his official attitude might be with 
regard to the investigation of the drug industry, he made a vitu- 
perative attack upon a visitor whose assistance in those matters 
had already been solicited and acknowledged by the Justice 
Department. 

This attack came after Mr. Fulton had stated to me that be- 
cause of his former connection with the Cravath law firm in cases 
involving the drug industry, he would take no part in the official 
investigation of that industry then getting under way. 

However the controversy about Tommy Corcoran's influence 
with Mr. Biddle and others in the Justice Department was not 
to die completely because of the refusal of the Truman Commit- 
tee's counsel to act on its Chairman's earlier announcement that 
Mr. Corcoran was to return and explain things. The entire humili- 
ating record was revived and considerable new light was thrown 
upon it when Assistant Attorney General Norman M. Littell began 
airing his side of his row with Mr. Biddle in December 1944 about 



TREASON'S -PEACE 571 

the Corcoran influence. And after Mr. Biddle attempted to reply 
to the Littell charges, the latter let loose a blast which was so 
strong that the Senate Committee on National Defense ( of which 
Mr. Fulton had been counsel) now headed by Senator James M. 
Mead, of New York, refused to make it public. 

But on January 22, 1944, Republican Representative Lawrence 
H. Smith, of Wisconsin, to his everlasting credit, courageously 
rose to the occasion by inserting the Littell statement in the Con- 
gressional Record, along with his own accusations and a resolution 
demanding an investigation of the conduct of Biddle as Attorney 
General with special reference to the influence exerted by Mr. 
Corcoran in the Sterling case. 

The Littell statement started with the indictment that the set- 
tlement of the Sterling case "marks the lowest point in the history 
of the Department of Justice since the Harding Administration/' 

After summarizing the history of Sterling and its subservience 
to Farben and the Nazi Government, also Sterling's subversive 
activities in Latin America (as discussed in Chapter xm), Mr. 
Littell turned his guns on the record of the Sterling case when 
Mr. Biddle became Acting Attorney General and traced, step by 
step, the actions of Thomas Corcoran in "defeating the indictment 
of the companies and individuals involved." 

"Corcoran/* said Littell, "was engaged in a race with time 
to (1) stop the investigation before it reached such a con- 
clusive stage and (2) get the cases filed on a civil basis with 
consent decrees merely restraining further violation of the 
Anti-Trust Laws, and above all things ( 3 ) prevent the pres- 
entation of the evidence to a grand jury/' 

Mr. Littell also stated that the anti-trust staff working on the 
Sterling case were apprehensive because Corcoran was in and 
out of the Justice Department and it was also known that he was 
working hard to secure Mr. Biddle's appointment as Attorney 
General and "Biddle was then to urge Tommy's appointment as 
Solicitor General, which he later did but without success." 

In a time table of events leading up to its final disposition Mr. 
Littell, with his prestige and knowledge as recently one of the 



372 TREASON'S PEACE 

highest officers of the Justice Department, confirmed in substance 
and in fact the statements and reports heard back in 1941 ( as told 
in Chapter rx) about how Tommy Corcoran rode rough-shod 
through the Department with Mr. Biddle's approval. 

This Littell blast also placed new light on certain aspects of 
the matter, including the hiring by Earl McClintock and William 
E. Weiss, of David Corcoran, brother of Tommy, to be an execu- 
tive of Sterling's subsidiaries which handled Latin- American busi- 
ness in the Farben partnership. This engagement of a brother of 
the court favorite took place in the early 1930's when Tommy Cor- 
coran was the White House piano player and legislative deviser. 

Other aspects of the case which Mr. Littell revealed were: that 
Sam S. Isseks, friend and classmate of Tommy Corcoran, was 
moved mysteriously into charge of the Sterling case over the heads 
of those handling the investigations, that anti-trust violations 
had been clear, but far more sinister facts appeared on the record 
because Sterling in its subservience to Farben had in fact become 
an agent of Nazi Germany, carrying out policies aimed at the 
security of the United States; that some of the Justice staff be- 
lieved not only anti-trust indictments were justified but also in- 
dictments for criminal conspiracy (against the Government of 
the United States) under Section 88, Title 18, providing fines of 
$10,000 and two years imprisonment; that while the battle was 
going on inside the Justice Department Mr. Biddle was merely 
Acting Attorney General, until August 24, 1941, when his nomina- 
tion for the office was announced, events then moving rapidly as 
it thus became clear he would have authority to act. So on Sep- 
tember 4th the Senate confirmed the appointment and the next 
day the notorious consent decrees and nominal fines were an- 
nounced. And finally the fact that in the meantime the new At- 
torney General had ordered the Justice Department staff to stop 
the Sterling investigation and mark the case closed (with no in- 
dictments), after some thirty thousand documents had been as- 
sembled revealing as conclusively as any case in the history of 
the Justice Department the means employed by Farben, in World 
War II as in World W T ar I, to serve the purposes of the German 
Government in the Western Hemisphere. 



TREASON'S PEACE 373 

Following his timetable, Mr. Littell attacked Mr. Biddle's crude 
attempt to defend his conduct at another Senate Committee meet- 
ing. He denounced as false several of the Attorney General's state- 
ments, especially an assertion that the only conference Biddle 
had had with Corcoran was in October 1941, after the consent 
decrees were filed. This, commented Mr. Littell, was obviously 
untrue, as the pressure prior to September 5, 1941, because of the 
interference of Tommy Corcoran was so great that resignations 
were threatened within the staff of the department. 

As one commentator put it, Tommy Corcoran hung his hat 
in the Attorney General's office during this period. 

Other allegations by Mr. Biddle which drew the fire of his 
former assistant were that Biddle had asked for maximum fines 
in the Sterling case and that jail sentences were never imposed in 
any anti-trust actions. 

The "maximum fines" said Mr. Littell, were assessed not after 
action of a grand jury but upon an information which "by no 
means includes all of the acts or refers to all of the evidence in 
the Department of Justice." 

"And, furthermore," Mr. Littell declared, "Mr. Biddle's state- 
ment ( regarding prison sentences ) is untrue" as in some 184 other 
anti-trust criminal cases tried, 786 months of prison had been 
imposed. 

Mr. Littell also expressed his own opinion, as a prosecutor, that 
many other laws might have been invoked against the Sterling 
conspirators, including those Federal Statutes dealing with trad- 
ing with the enemy, espionage, and interference with our foreign 
relations, also that actions under the law requiring registration 
of agents of foreign principals might have been invoked because 
that law affects any: 

attorney for. or any other person, who receives com- 
pensation from, or is under the direction of a foreign 

business, a foreign political organization, or a domestic organ- 
ization subsidized directly or indirectly in whole or in part 
by any of the above. 



374 TREASON'S PEACE 

A grand jury, said Mr. Littell, might well have reached the 
conclusion that Tommy Corcoran as well as executives of Sterling 
fitted into the above definitions of terms prescribed by the Attorney 
General as foreign agents. 

Finally, Mr. Littell dismissed as unfounded allegations by the 
Attorney General that the action by the Justice Department had 
purged Sterling of German influence. 

Taken all in all, Mr. Littell's accusations were so specific and 
so forcefully presented that immediate challenge and reply might 
have been expected from Mr. Biddle, Mr. Corcoran, and Sterling. 
But no reply in public was forthcoming. Nor was reply ever made 
to the charges of Representative Smith, which included statements 
that Sterling supplied the Nazi Government with funds in 1938; 
that Sterling had had fake offices and secret hideouts in New York 
and New Jersey where funds could be diverted to pay for German 
propaganda and Gestapo agents, and that the Sterling officials 
"were concerned not with the protection of American interests, 
but with advancing the interests of our common enemy/' 

Along with the resolution introduced by Representative Smith 
was a second demand along the same lines which was proposed 
by Representative Jerry Voorhis of California. The latter, who 
has earned a name for himself similar to that of the late Senator 
Norris for sincere, forthright action regardless of who may be 
involved, also introduced a resolution demanding investigation 
of the allegations of undue or improper influence upon officials 
of the Justice Department and the truth or falsity of the charges 
made by Mr. Littell. 

Coming from Representative Voorhis, who was a strong sup- 
porter of the Roosevelt Administration, his resolution, to some, 
appeared of even greater significance than that of Republican 
Representative Smith. And Mr. Voorhis had already paid tribute 
to Mr. Littell on November 30, 1944, and had demanded an in- 
vestigation of the situation in an earlier speech in the House at 
the time when Biddle had induced the President to remove Mr. 
Littell for alleged insubordination, but before the latter's counter- 
accusations had been made public. 

Both the Smith and the Voorhis resolutions were referred to 



TREASON'S PEACE 375 

the Rules Committee, which promptly sat upon them, and, almost 
a year and a half later was still withholding action which would 
permit the Congress to take a vote on whether to investigate Mr. 
Riddle, or Mr. Corcoran, or the Sterling case settlement. 

One voice was raised in public, feebly, to defend Corcoran and 
Sterling. Thurman Arnold from his dignified retreat in the Court 
of Appeals was reported to have indicated publicly that his opin- 
ion as expressed in September 1941, after the Sterling decrees 
had been filed, remained unchanged. This reference to the weird 
press release issued from Mr. Riddle's office in the name of Mr. 
Arnold on September 25, 1941, may not appear to be much of 
a reply to the Littell charges, in view of the inaccuracies (noted 
in Chapter ix) in this earlier makeshift exoneration issued over 
the Arnold name. 

Aside from its startling revelations, the greater significance of 
the battle between Riddle and Littell appears to be in the familiar 
pattern; that charges of so specific a character could have been 
made during war-time on the floor of the House against one of 
the highest officials of the Government, involving collusive im- 
munity for those accused of collaboration with I.G. Farben and 
the Nazis and thereafter, while the war went on into peace, the 
charges remained hushed, and the immunity continued. 

During my war-period efforts to bring about an investigation 
of matters relating to I.G. Farben, Dr. J. R. Matthews, celebrated 
researcher for the Dies Committee explained to me in August, 
1942, that such an undertaking would be difficult because the com- 
mittee had no investigators competent to make such an inquiry. 
Furthermore, Dr. Matthews, with asides from R. E. Stripling, the 
Dies chief investigator, lectured me on the thesis that I should dis- 
tinguish between the commercial and political significance of in- 
ternational agreements, such as Standard Oil had with Farben. 
This argument may well indicate the competency of the Dies in- 
vestigational staff. 

Another example of Congressional war-time silence on matters 
relating to Farben was the squelching in October 1942, of one 
of the most robust two-fisted members of the lower house, Rep- 
resentative John M. Coffee. Mr. Coffee, in a fiery speech, did not 



376 TREASON'S PEACE 

mince words in describing an attempted sabotage of the war ef- 
fort by Farben allies, but his resolution to explore the matter was 
then buried in the trash basket of the House Rules Committee. 

Other incidents of hush and immunity will be related, but those 
mentioned should suffice to show how soon the pattern of hidden 
protection for Farben's allies which prevailed during the long 
pre-war years had actually begun to reappear, after the brief 
period of partial expose and abortive prosecutions which followed 
Pearl Harbor. 

Perhaps the most disturbing aspect of this renewed defiance of 
the integrity of a Nation's war-time mobilization was in the Con- 
gress of the United States, where no member of either house, with 
ample knowledge of these facts, was permitted to stand up and 
hold the floor in protest until his colleagues and the Nation should 
have been compelled to listen, and to act. 

Even in the Senate, with its unlimited debate and its high 
powers, no such voice was raised. 

This aspect of the Farben pattern has never been described more 
concisely than it was in a public address delivered by Supreme 
Court Justice Robert H. Jackson, in June 1941, shortly before he 
retired as Attorney General of the United States. Mr. Jackson 
appealed for assistance to defeat what he defined as the 

pattern of a premilitary and nonmilitary invasion 

of business, finance, labor, public opinion and political 

organizations alien-directed and financed propaganda 

against the policy of our Government at Congressional 

hearings in court against investigational officials 

and agencies, prosecution policies, and law enforcement itself. 

It was just at this time that pressure was being brought to bear 
upon members of the Attorney General's staff to relax their ef- 
forts in several investigations and prosecutions which Mr. Jackson 
had ordered into Farben's long-standing illegal tie-ups and sub- 
versive activities in the United States. As Attorney General, Mr. 
Jackson had given Thurman Arnold the green light to get tough 
and clean out the Farben framework. In view of what occurred 



TREASON'S PEACE 377 

thereafter, it is unfortunate that Mr. Justice Jackson did not re- 
main as Attorney General until the last vestige of the Farben pat- 
tern should have been rooted out and eradicated in this country, 
in anticipation of a similar clean-up by America's Prosecutor Jack- 
son in Europe. 



CHAPTER XX 



Plans for Peace In Time of War 



I . G . F A R B E N , 

unlike the governments and the armies of Germany, never sur- 
renders and never dies. Win, lose, or draw, the pattern of Farben 
goes on. When the first World War ended, Farben turned abruptly 
from the production of munitions no longer needed by a defeated 
army to rebuilding its international framework in preparation for 
the next attempt at world conquest. Again, this tenacity of purpose 
and flexibility of pattern are clearly discernible in the events which 
developed so speedily in those hectic weeks following the sur- 
render of Germany on May 6, 1945. 

An important phase of this pattern of eternal life and perpetual 
war is found in numerous carry-over agreements or understand- 
ings already referred to between Farben and certain of its affiliates 
in the United States, all of which provided for, or promised, re- 
sumption of pre-war arrangements when the war should end. 

Aside from written agreements are the verbal understandings 
such as that described in Chapter II in the 1914 letter from the 
German Hoechst to Herman Metz: 

Our entire relationship is really a confidential relationship 

378 



TREASON'S PEACE 379 

and it will be and must, without agreements, so continue in 
the future as in the past. 

A similar relationship may be observed in a report of the duPont 
Foreign Relations Department, dated February 9, 1940, in which 
reference was made to various current agreements with Farben 
relating to nylon and plastics, and to an arrangement made to 
return to Farben certain funds advanced to purchase shares in 
Duperial, the duPont-I. C. I. dye subsidiary in South America. 
The British I. C. I. had objected to Farben's purchase of the shares, 
so duPont was arranging to repay the money. The report went on 
to say: 

The duPont Company informed I.G.. that they intended 
to use their good offices after the war to have the I.G. par- 
ticipation (in Duperial) restored. 

Senator Bone was indignant at this and other evidence of an 
intended resumption of "business as usual" with Farben after the 
war. Said the Senator: 

Everything that has been revealed so far on the 

relationship between these big private outfits indicates clear- 
ly that as soon as this bloody war is over the gentlemen are 
going to get their feet under the table and restore their ante- 
bellum status as soon as that can be accomplished I am 

wondering if the high officials of this government are aware 
of the fact that these gentlemen, who have parcelled out this 
world, have intended to make such adjustments of this prop- 
erty after the war. That is a picture which should be very 
clearly presented to Congress, and Congress should have 
something to say about it. I am disposed to think that it will. 

Senator Bone was mistaken. Congress had nothing to say about 
it. 

On one other occasion before his Committee closed up shop, 
Senator Bone warned of the future, saying: 

You recall how we were caught up after the last war? 
We took over a lot of German patents in the pharmaceutical 



580 TREASON'S PEACE 

and chemical fields and our business entrepreneurs proceeded 

to fix things so that they were given back to the Germans 

through finagling devices After this war, unless we are 

wiser or smarter than I think we may be, we will probably 
find that the block of patents that the Alien Property Custo- 
dian has will ultimately find their way back into the hands 
of smooth German operators, and we will go through this 
same wretched process again, in spite of the fact that there 
may be a million of our boys who have paid the price with 
their blood and broken bodies. 

As the events of the war progressed favorably, confusion in- 
creased at home and a new voice was raised in opposition to a 
future renewal of international cartels in general and that of 
Standard Oil-Farben in particular. 

On July 26, 1943, Vice-President Henry A. Wallace, smarting 
at having been removed as head of the Board of Economic War- 
fare, delivered a political comeback speech in Detroit in which 
he took a slap at cartels; a few weeks later, in Chicago, on Sep- 
tember 11, he became more specific, referring to the "creators of 
secret supergovernments." 

Prior to the Chicago address the Vice-President had received 
a mass of data on the subject from William Floyd II, Chairman 
of the Standard Oil Minority Stockholders Committee. His attack 
was so specific that the following day Standard's president, R. W. 
Gallagher, replied defending his company's tie-up with Farben 
and bitterly criticizing the Vice-President for the attack. In passing 
Mr. Gallagher mentioned his own opposition to cartels and a few 
days later, Standard's pugnacious public relations pacifier, Robert 
T. Haslam. permitted Sylvia Porter to quote him in the New York 
Post that the dispute between Mr. Wallace and Mr. Gallagher 
was all an unfortunate mistake because Standard was already 
in agreement with the Vice-President. 

Next, Assistant Attorney General Wendell Berge, now returned 
to anti-trust as its chief, called Messrs. Gallagher and Wallace 
into conference and it appeared that a semblance of harmony 
was restored; both parties seemed to oppose international cartel 
agreements (with Farben) unless such agreements were to be 



TREASON'S PEACE 381 

registered with the State or Justice Department. This quaint res- 
ervation hardly indicated much hope of action which would do 
away with cartels as such in the future, or to eradicate I.G. Farben 
and its pattern for all time as the primary essential for an enduring 
peace in the post-war era. A week later Mr. Berge published an 
article in the New York Times Magazine entitled "Can We End 
Monopoly," in which he first admitted that for the last forty years, 
"emotional promises to enforce the Sherman Act" by both political 
parties resulted in elected officials who "with equal consistency 
did nothing about it." 

Despite this painful admission, Mr. Berge also naively asserted 
that during the present war "the spirit of the anti-trust laws has 
not only been preserved, but much of the effect as well." Perhaps 
the new anti-trust enforcement official was thinking of the adage, 
"the spirit is willing but the flesh is weak." 

Mr. Berge also paid unconscious tribute to the official Farben 
policies of hush-hush and immunity by saying that: 

The full story of our unintentional industrial contribution 
to the German war effort has not been told 

He finally concluded that 

enforcement of the anti-trust laws is being pressed 

as vigorously now as available manpower permits. 

It was hardly an optimistic forecast. 

It may appear that the outspoken opposition of Henry Wallace 
to cartels in general and to Farben in particular was not the least 
important of the reasons which cost him the renomination as Vice- 
President. The truth regarding President Roosevelt's health was 
even then known, or at least suspected, by the inner councils of 
his party leaders. They chose his successor. 

The foregoing brings this story, for a brief space, to France and 
North Africa, through which, when the Nazi doom became visible, 
the leaders of I.G. Farben established a bridgehead of escape to 
a financial bomb shelter in Algiers. It was then reported that cer- 
tain Vichy French financial collaborators, hoping to salvage some 
of the Nazi loot by aiding in its concealment, had joined hands 
with Farben in a 'scheme to transfer the huge funds Farben had 



382 TREASON'S PEACE 

accumulated by absorbing four of the largest chemical and dye 
industries in France, to North African banks, where they might 
remain safe regardless of who won final victory in Europe. 

The United States appeared in this picture with the landing of 
its troops in North Africa in October 1942. Then, while thousands 
of American youths were dying to end what Farben had started 
there came the disquieting rumor that the on-the-spot repre- 
sentative of the State Department of the United States was in 
accord with the obviously German-inspired proposal to freeze the 
financial status quo in North Africa. 

Here the same old pattern reappeared, hazily perhaps, but 
nonetheless the outline of a modus operandi of survival a bridge- 
head out of the war zone of beaten Germany by which Farben 
could emerge as a going concern, financially strong and ready to 
resume business. 

Meanwhile there appeared on the stage the obscure figure of 
Fritz Thyssen, whose steel trust had been tied in with Farben 
since 1927. Thyssen, in a true-confession story, "I Paid Hitler," 
whined, repented his error, and proclaimed that the one way to 
insure the next peace would be for "men of good will" to reestab- 
lish the new Germany as a corporate state. 

So Thyssen emerged at a propitious moment as a leader who 
might induce the thoughtful citizens of the Fatherland to throw 
out the vile Hitler and join hands with the Allies in a plan which 
would save Germany's industries and industrialists, and create a 
reformed Reich and # peaceful world. 

After the landing of the Allies in France and as the war speeded 
toward its inevitable end, discussions of how best to handle a de- 
feated Germany centered around German 'industry in general 
and I.G. Farben in particular. 

So the struggle beneath the surface of official Washington con- 
tinued, between those who favored Farben survival and those 
who did not. 

While the late Commander-in-Chief was under stern compul- 
sion to devote time and energy to global war, the greatest of all 
time, he was forced to rely upon subordinates and upon Congress 
to defeat and destroy the pattern of Farben. And it may appear 
that already certain of those underlings and their legislative col- 



TREASON'S PEACE 383 

leagues fell in step one by one, and blindly took places assigned 
to them in the nooks and crannies of a new Farben framework as 
it was to be revised to fit the new peace. 

Let it be said here, again, that there is no force which can re- 
strain or turn such men from folly save only the lash of public in- 
dignation aroused by revelation of facts now hushed. 

They are not stupid men who reach through all the barriers of 
war or peace to seduce other men who are stupid to new betrayals 
with specious arguments of a better, normal world, or potent 
draughts of suggestion, of power to come. The dispute raged 
should professors, politicians or plutocratic leaders of industry 
direct the war and build the peace. As to which of these Farben 
does not care. Its pattern has always found places for all three 
and can do so again. 

For one more moment go back go back to Bayer's Schweitzer 
telling Ambassador von Bernstorff in 1916 not to worry about the 
future as it would be easy to choose a President with the "right 
politics" to respond favorably to a post-war comeback of I.G. 
Dyes in the United States. So does history repeat. 

Or go back again, not so far, to the aged Gerard still politically 
powerful, in June 1943, defending Standard refusal to abolish 
all ties with Farben because: 

Some of those who are thinking what is to happen after the 
war, are contemplating universal cartels. 

Officially there could be no doubt that President Roosevelt fa- 
vored a hard peace for Germany and the most vigorous handling 
of Farben. On September 8, 1944, Mr. Roosevelt made this clear 
in a letter to Secretary of State Hull, which he made public and 
in which he said: 

The history of the use of the I.G. Farben trust by the 
Nazi reads like a detective story. Defeat of the Nazi armies 
will have to be followed by the eradication of those weapons 
of economic warfare 

Prior to this blast by the President it was reported that the soft- 
peace sentiments of certain members of the European Advisory 
Commission had produced a proposed handbook of directions 



384 TREASON'S PEACE 

for officers of the Allied Military Government (A. M. G.) 
which so favored a survival of the I.G. Farben set-up that Secre- 
tary of the Treasury Henry Morgenthau, Jr. hit the ceiling, pro- 
tested to the President and, as a result, was summoned to the 
second Quebec conference which was held by the President and 
Prime Minister Churchill in September 1944. 

The so-called Morgenthau Plan was then revealed, calling for 
the elimination of German chemical and metallurgical industries 
and the conversion of that nation largely to an agricultural econ- 
omy with no peacetime industries save those which could not 
contribute to a future war. 

Mr. Roosevelt and Mr. Churchill initialed and approved a mem- 
orandum which outlined this plan and which concluded with: 

The program for eliminating the war-making industries in 
the Ruhr and the Saar is looking forward to converting Ger- 
many into a country primarily agricultural and pastoral in 
character. The Prime Minister and The President were in 
agreement upon this program. 

When the Morgenthau Plan was made public the storm broke 
over his head, and the same barrage of epithets was aimed in his 
direction that had previously been hurled at England's leading 
advocate of a hard peace, Lord Vansittart. 

President Roosevelt thereupon, in December 1944, through 
United States Ambassador John G. Winant in London, outlined to 
the Allies his demand for a complete and ruthless abolition of 
German war industries, but as this outline allowed for some sm> 
vival of chemical industries for civilian requirements, it appeared 
less severe than the Morgenthau plan. 

At Yalta, in February, 1945, Mr. Roosevelt, with Churchill and 
Stalin, stepped back a bit more from a program of total elimina- 
tion of Farben by declaring merely an "inflexible purpose" to 
"eliminate or control all German industry that could be used for 
military production/' 

This was to be the last official pronouncement of policy on this 
subject by President Roosevelt. Those who were closest to him 
believed that he never wavered from his determination that 



TREASON'S PEACE 385 

As for Germany, that tragic nation we and our Allies 

are entirely agreed that we shall not leave them a single 

element of military power or potential military power. 

However in April, after Harry S. Truman became President, 
there was issued and then withheld from public knowledge, a 
Joint Chief s-of-StafT order (J. C. S. 1067) instructing General 
Eisenhower for the governing of occupied Germany. This order 
required basic objectives "to the full extent necessary to achieve 
the industrial disarmament of Germany." It prohibited all re- 
search laboratories save those necessary to the protection of the 
public health, and stipulated abolition of all 'laboratories and 
related institutions whose work has been connected with the build- 
ing of the German War Machine." Also it forbade all research 
that would in any way contribute to Germany's future war poten- 
tial. 

These vigorous directives were softened however by a later 
reference to the "pending final Allied agreement on reparation, 
and on control or elimination of German industries that can be 
used for war production " 

The Potsdam Agreement, arrived at in July and August by 
Prime Minister Attlee of England, Marshal Stalin of Russia, and 
President Truman, followed closely the earlier directives "to elim- 
inate Germany's war potential" by control and restriction of indus- 
try "to Germany's approved postwar peacetime needs" and or- 
dered that: 

In organizing the German economy primary emphasis shall 
be given to the development of agriculture and peaceful do- 
mestic industries. 

On July 5, 1945, under instructions contained in J. C. S. 1067, 
the U.S. Military Government in Germany (O.M.G.U.S.) pro- 
mulgated General Order No. 2, which directed seizure of Farben 
for the purpose of making its plants available for reparations, and 
for destruction of all Farben arms or munitions of war or of any 
ingredients for same, which are not generally used in industries 
permitted in Germany. 



386 TREASON'S PEACE 

Special Order No. 1, of the same date, appointed a control officer 
for Farben to prevent the production by and rehabilitation of 
these plants except as might be specifically determined in accord- 
ance with objectives of United States. 

However, within a few weeks of the promulgation of this order 
Brigadier General William H. Draper, formerly of the New York 
banking house of Dillon, Read & Co. (which floated the thirty 
million dollar bond issue of Vereinigte Stahlwerke, Fritz Thyssen's 
Steel Trust, in the United States ) was reported in a published dis- 
patch from Berlin to have declared that a considerable portion 
of Germany's pre-war industry must remain if Germany was to 
survive. 'General Draper was chief adviser to General Eisenhower 
on German industry. 

This apparent defiance of official military orders appeared 
strange, but no more so than the address delivered by the Hon- 
orable John J. McCloy before the Academy of Political Science 
in New York City on November 8th. Mr. McCloy, who had just 
resigned as Assistant Secretary of War, argued that Germany 
could never be made into an exclusively agricultural or pastoral 
society. He belittled the capacity of the enemy's remaining in- 
dustrial plants and indicated that their plants should be put to 
work as soon as possible to pay for food that was to be imported. 
Concluded Mr. McCloy, "For a long time to come there is no justi- 
fiable fear that Germany's war potential is being rebuilt." 

The Assistant Secretary of War, until 1940, was a member of 
the law firm of Cravath, de Gersdorff, Swaine & Wood, which firm 
as mentioned in earlier Chapters had been representing I.G. Far- 
ben or its affiliates in the United States. It may appear to be a 
coincidence that Mr. McCloy should have turned up in the War 
Department in 1941, in a position in which he could speak with 
authority on such matters as handling the destruction of that 
mainstay of Germany's war potential I.G. Farben. The coinci- 
dence may also be recorded here that other members of the Crav- 
ath law firm also held responsible places in the War Department, 
including Alfred McCormack, and Howard C. Peterson, as assist- 
ants to the Secretary. Another former member of this firm, Col. 
Richard A. Wilmer, was commissioned after the war began and 
had to do with such problems. 



TREASON'S PEACE 387 

One fact is apparent General Dwight D. Eisenhower was def- 
initely not in accord with those who favored softness. While on a 
visit to Washington on October 20, 1945, the General publicly 
demanded the complete dissolution of I.G. Farben in order to 
assure future world peace. That this was his intention may not 
be doubted. But the General of the Armies in Europe, with all 
his powers as a combat soldier, did not make policy and did not 
select many of the men who were sent to Germany by the State 
and War Departments and the F. E. A. 

The retreat from the official policy of eliminating I.G. Farben 
continued with a statement by Secretary of State James F. Byrnes, 
in December 1945, in which he announced that German adminis- 
trative agencies should be set up to control foreign trade and 
industry, and that German industrial production should be per- 
mitted to increase, and German exports permitted to finance neces- 
sary imports. 

In August of that same year President Truman had been per- 
suaded to send the well-meaning former war censor, Byron Price, 
to Germany to survey conditions. Mr. Price's report, while highly 
informative, ignored completely the lessons of Farben's quick 
emergency after the first World War by stating that 

There certainly is not the slightest evidence that Germany 
can become, within the f orseeable future, sufficiently strong to 
permit diversions of production for German war purposes. 

In the Halls of Congress, Senators and Representatives were 
bombarded by the forgive-and-forget brigade and the advocates 
of immmediate restoration of German industry so that the dear 
little baby Nazis would not starve. 

Some of this special pleading was sincere idealism, and some 
of it arrant hypocrisy all too similiar to the brazen demands for 
the restoration of the German dye trust after the first World War. 
History repeats. 

One very informative speech, which indicated the under cover 
struggle in official circles on the future of I.G. Farben, was de- 
livered in the Senate on January 29, 1946 by Nebraska's distin- 
guished funeral director, Republican Senator Kenneth S. Wherry. 
This mortician-turned-statesman referred to the 



388 TREASON'S PEACE 

Bitter rivalry between Mr. Morgenthau's henchmen in the 
Treasury Department and representatives in the War and 
State Department as far back as 1942; 

and stated that: 

Mr. Morgenthau finally won his battle and forced the 

incorporation of his plan into the new infamous document 

J. C. S. 1067 despite the repeated warnings of Mr. 

Stimson and of many high officials in the State Department. 

Unfortunately, the speech was received with acclaim by all too 
many members of the Senate of the United States. 

As illustrative of the non-partisan pattern of all such legislative 
propaganda, Senator James Oliver Eastland, Democrat colleague 
of Bilbo from Mississippi, contributed a fine appeal to passion and 
illogic on December 4, 1945, in a lengthy diatribe against Secretary 
Morgenthau for wanting to eliminate German war industry and 
at Russian soldiers for, allegedly, raping German maidens. 

In associating these two varieties of injury to the German people 
as a single great humanitarian issue, the Senator propounded this 
disingenious query: 

Why blur the easily defined distinction between peacetime 

industry and wartime industry? to de-industrialize 

German is not necessary to render Germans powerless again 
to Wage war. We are concerned instead with the great issue 
of humanitarianism. 

However, it remained for that great Republican statesman from 
Indiana, the Honorable Homer E. Capehart, to win the Senatorial 
humanitarianism sweepstakes with an outburst on February 5, 
1946, in which he denounced Mr. Morgenthau and the advocates 
of his plan, rather than the Nazis, as responsible for mass starva- 
tion of the German people and the deliberate destruction of the 
German state. Accusing them of "burning with an all-consuming 
determination to wreak their vengeance," the Senator stormed at 
his colleagues that their "technique of hate" had earned for Mr. 
Morgenthau, and Colonel Bernard Bernstein, the titles of "Ameri- 
can Himmlers." 



TREASON'S PEACE 389 

The thesis that the eradication of Farben's war potential was 
all wrong because people were starving in Germany was also 
found in a November 1945 report of a House of Representatives 
Committee on post-war planning, of which another Mississippi 
statesman, William M. Colmer, was chairman. This report stressed 
the pre-war dependence of other European countries (Farben's 
victims) on Germany's industry. Ignoring the obvious fact that 
chemical and metallurgical industries could operate just as effi- 
ciently for peace if moved out of Germany into adjoining countries 
where the lust for world conquest does not exist, Representative 
Colmer's report naively proclaimed that to strip Germany of its 
ordinary industries would injure industrial production in other 
countries (those ravaged by Germany) and also would impose 
a heavy burden on the United States or widespread starvation 
and dangerous conditions all over Europe. 

Over the air and in the press the pleas to save Farben were 
heard in a great variety of argument. Among the gems of radio 
propaganda against the Morgenthau plan was the conclusion ex- 
pressed by Saul K. Padover, biographer of emperors and former 
college professor, who is credited with effective work in the Army's 
Psychological Warfare Division. Professor Padover in a World 
Peaceways broadcast on December 16, 1945, ended his plea that 
we must re-make the German mind (he admitted that this would 
take decades ) with a caution that there was an element of danger 
should we punish I.G. Farben or destroy its plants. "Destroying 
factories will achieve nothing" concluded the Professor. 

Then he left in a hurry to return to his official duties in Germany. 
Months later, after Professor Padover had re-examined the 
stealthy resuscitation of the German industrial war potential in the 
guise of a peace-time economy, he changed his views. On Septem- 
ber 9, 1946 in the newspaper PM the Professor expounded ably on 
the necessity to deprive the Reich of its industrial might in order, 
as he said, to turn it into "a giant without weapons, and conse- 
quently not to be feared." 

However, as will appear later, the Professor's recognition of the 
menace of the Farben war potential did not appear until after our 
Secretary of State had taken one more step away from the Roose- 



390 TREASON'S PEACE 

velt program of destruction for all time of the real menace to 
future peace. 

Meanwhile Raymond Moley, the kiss-and-tell hero of early New 
Deal days who had openly advocated a new era of German indus- 
trial cartelization to be directed by Americans, broadcast his con- 
clusion that already the Morgenthau plan was gone, and that Far- 
ben, "one of the most unusual and important organizations in the 
world," need not be destroyed as it could be properly controlled, 
now that Americans had taken over. 

Among the columnists, Dorothy Thompson, strangely changed 
from her earlier attitude, was probably the most vociferous and 
certainly the most hysterical opponent of Franklin Roosevelt's an- 
nounced determination to eradicate the industrial war potential 
of I.G. Farben. 

As justifying her attacks on "de-industrialism," as she called it, 
Miss Thompson made the point that "Only a limited number of 
industrialists helped Hitler in any way to come to power," and 
stated that her criticisms were based upon: 

Unswerving allegiance to the principles of democracy, the 
rarely practiced ethics of Christendom, the long range inter- 
ests of America, and an unflagging defense of humanism. 

Sylvia Porter, brilliant rival of Miss Thompson, replied in her 
column in the New Yorfc Post that the fundamental issue was to 
so direct Germany's post-war economy that she would never again 
be able to threaten world peace. Summed up Miss Porter on Au- 
gust 6, 1945: 

The Nazi party didn't make Hitler. Germany's industrial- 
ists made him and made his invasion possible. 

And Farben's friends did not have it all their own way in the 
United States Senate. In June 1945 a few weeks after the sur- 
render, Democratic Senator Harley M. Kilgore returned from an 
early postwar trip to occupied Germany with the announcement 
that he had uncovered proof of the plot to revive I.G. Farben and 
other German war industries, and that German industrial leaders 
were already preparing for the next world war. 

Senator Kilgore, made Chairman of the Sub-Committee on War 



TREASON'S PEACE 391 

Mobilization of the Senate Military Affairs Committee in 1943, 
had done excellent work in uncovering and recording evidence 
of Farben's prewar criminal conspiracies in the country and had 
also explored some aspects of the cartel problem in general. 

In fact, Senator Kilgore became the first member of the Con- 
gress to express written approval of my own earlier efforts to 
expose the influences which were protecting the Farben prewar 
conspiracy when he wrote me in February 1944 that: 

If Congress had only investigated this (Farben) lobby in 
1931 as you recommended, we should have had a more 
healthy realism about Germany and cartels rather than the 
realism of war. 

On June 22, 1945 Senator Kilgore called the Honorable Bernard 
M. Baruch as a witness, and the latter, to his everlasting credit 
and to the dismay of many of his Wall Street friends, delivered a 
most devastating blast at Germany's industrial war potential which, 
he demanded, must be smashed for all time. Bluntly he described 
Farben's industrialists: 

War is their chief business and always has been 

Her war-making potential must be eliminated; many 

of her plants shifted east and west to friendly countries; all 
other heavy industry destroyed 

The elder statesman's testimony constituted a substantial ap- 
proval of Secretary Morgenthau's proposals and as such went fur- 
ther than the Yalta agreement of the three heads of state. Over 
and over Mr. Baruch denounced the German industrial leaders as 
equally guilty of murder as were the Nazis. 

"German industry is a war industry," he said. "You cannot 
industrialize Germany and keep her from being a war agency." 

Other witnesses who followed Mr. Baruch before the Kilgore 
Committee included Assistant Secretary of State William L. Clay- 
ton, who testified regarding evidence uncovered in Germany of 
the grandiose plot engaged in by I.G. Farben and other war in- 



392 TREASON'S PEACE 

dustries in concealing their capital assets and technicians in 
"safe havens," as he termed them, in foreign countries in order 
to prepare for the next war. 

Perhaps the most important testimony presented to the commit- 
tee, in its significance as regards the postwar administrative policy 
on I.G. Farben, was a lengthy program outlined by Leo T. Crow- 
ley who, at the time, was still wielding his great powers and influ- 
ence behind the scenes as Foreign Economic Administrator. In 
the outline of his program of economic and industrial disarma- 
ment Mr. Crowley indulged in a series of contradictory allegations 
and proposals which, facing both ways, would appear to be merely 
aimless double-talk if it were not for its more serious aspects. Mr. 
Crowley's thesis at the start very ably pointed out that: 

It was not the amount of military material which Germany 
was able to save from destruction by the Allies nor the hand- 
ful of military material which Germany was able to manufac- 
ture during the years which immediately followed the 

defeat of 1918 Rather it was the fact that Germany re- 
tained intact a vast aggregate of economic and industrial war 
potential and was able to continue to experiment, plan and 
prosecute its development in terms of future war production 

that was important " and "that later enabled the German 

nation to organize itself completely and entirely for war 

The above appears to be an extremely well expressed recogni- 
tion by Mr. Crowley of German's real war potential. However, in 
concluding, Mr. Crowley openly advocated another era of control 
instead of eradication, saying that "economic security from future 
German aggression must," among other things, "recognize the dif- 
ferences between a powerful war economy and a healthy peace- 
time economy" and "be achieved by affirmative industrial 

and economic controls as a first step." 

Among the gems in this list of "musts" relating to the control but 
not the elimination of Germany's war potential were requirements 
that the control " be possessed of a maximum of administra- 
tive feasibility and simplicity. Complicated and detailed controls 

may be practical during the period of occupation Be simple 

and understandable for the common people of the world " 



TREASON'S PEACE 393 

With gibberish of this sort emanating from one of the highest 
ranking administrators in Washington, is it any wonder that minor 
O. M. G. officials who wanted to do a job were discouraged and 
ineffective. 

It is appropriate to recite here statements of necessity for the 
disarmament of Germany which are set forth in the summary of 
the final program prepared under Mr. Crowley's direction and 
made public some months after his statement before the Kilgore 
Committee. 

One of these necessities is stated to be that "The achievement 
of security from future German aggression should be the primary 
and controlling element in our foreign policy toward Germany." 

Another admits the inadequacy of any program which merely 
stops the direct production of arms and munitions and states: 

Military potential in a total war is a combination of mod- 
ern industrial, scientific, and institutional components of such 
a nature as to make them equally useful for war or civilian 
productions. 

Having thus ably stated the necessity to eliminate completely 
I.G. Farben and its allied metallurgical industries, the Crowley 
program and its appendix in some 660 closely printed pages of 
figures and discussion then recommends the continued operations 
of these same industries with the trained management and scien- 
tific research which must accompany them all this to be "con- 
trolled" for an indefinite period. In other words a substantial repeti- 
tion, step by step, of the control of German industry instituted by 
the Allies after the first World War which fumbled and foozled 
until it was abandoned, while the men of Farben went right along 
with their plans for the next war. 

With respect to Mr. Crowley's contradictory recommendations 
on German industry it is only fair to state that Henry H. Fowler, 
Director of the Enemy Branch of the F. E. A., who did much of 
the work on the problems, also presented numerous exhibits to 
the Kilgore Committee on June 26, 1945 which were notable con- 
tributions to the unmasking of Farben's war potential. 

Having contributed his final compendium of governmental pol- 
icy which related to the survival of I.G. Farben, Mr. Crowley re- 



394 TREASON'S PEACE 

tired from his numerous and onerous government jobs to his duties 
as president and chairman of the Standard Gas & Electric Com- 
pany and other public utilities in which he held office. However, 
criticism of Mr. Crowley did not cease with the end of his govern- 
mental duties, as the Federal Power Commission on June 18, 1946, 
issued an order forbidding him to continue as chairman of one 
electric light company and director in two other utilities, giving 
neglect of his duties as the reason for thus ousting him. 



CHAPTER XXI 



Another Far ben Peace 



SENATOR KILGORE 

in October, 1945, publicly expressed his concern at reports that 
high officials were planning a revival of I.G. Farben's export 
trade instead of dismantling its facilities. 

In December, after his committee had assembled and made 
public voluminous records extracted from the I.G. Farben files in 
Germany which proved its war guilt beyond question, the Senator 
called as a witness Col. Bernard Bernstein, formerly Treasury 
Counsel, who, as Director of the Division of Investigation of Car- 
tels and External Assets in the O. M. G., had recently returned to 
the United States, having been sent back, according to report, be- 
cause he was too insistent in his efforts to uncover the part Farben 
played in the war and in searching for the accomplices through 
whom its assets were still hidden. 

Colonel Bernstein, in a lengthy statement prepared from original 
documents with meticulous care, brought out the startling fact 
that 87 percent of Farben's industrial war machine was ready to 
operate, and instead of being destroyed as required by the Yalta 
and Potsdam Agreements, was actually being put back into op- 
eration. His testimony showed conclusively that the German war 

395 



396 

machine could not have functioned without Farben, and that Dr. 
Carl Krauch, pre-war Nazi Chief of Germany's entire chemical 
industry, and chairman of Farben's board of directors, along with 
the other Farben leaders, had long known of the Nazi plan of 
aggression. The witness expressed the hope that the criminal role 
played by Farben's officials would result in their indictment and 
conviction as war criminals. Vain Hope. 

Shortly after this, Col. Bernstein resigned from the Government 
service. His successor in the O. M. G. set-up in Germany, Russell 
A. Nixon, a former member of the Harvard faculty, let loose a blast 
in Berlin, saying that Farben's high officials who had been arrested 
were being released, their plants were not being destroyed, and 
the uncovering of their hidden assets abroad was being hindered 
by State Department officials. 

So Mr. Nixon was also returned to the United States and he. 
too, gave his testimony before the Kilgore Committee. 

Mr. Nixon was now out of the Government service and was free 
of official restraints. He minced no words in stating that O. M. G. 
officials directly engaged in carrying out Order No. 2 of July 5. 
1945, were deliberately violating it, and that the I.G. Farben war 
potential was being actually rebuilt and reintegrated instead of 
being destroyed. Among high points of Mr. Nixon's testimony 
were detailed charges that: no I.G. Farben plants had been de- 
stroyed, those widely heralded as having been blown up were in 
reality government-owned plants. No law to destroy cartels in 
Germany had been promulgated and no policy existed in this 
respect. Farben officials and employes who had been arrested 
had then been released from custody in some cases were actually 
assisting in the activities of the O. M. G. The instructions for a 
complete mobilization of Farben's external assets had not been 
carried out. 

Farben's stock had gone up and up on the Munich and Frank- 
furt Stock Exchanges (from 68 to 142%) because the German 
people on the spot knew what was going on. 

The State Department and the British Foreign Office had acted 
together in preventing the seizure of Farben's foreign assets. 

Possibly the most significant item in Mr. Nixon's story was his 
statement that Farben's re-growth followed closely the expecta- 



TREASON'S PEACE 397 

tions which had been expressed by the notorious Max Ilgner, in 
a letter discovered by the O. M. G., which Ilgner wrote in 1944 to 
several of his associates and in which this Farben foreign-espionage 
head confidently advised his pals to stick together because he, 
Ilgner, could assure them that the American authorities would 
eventually came to their rescue and permit I.G. Farben to resume 
business as usual. 

Mr. Nixon not only minced no words in denouncing the official 
malpractice by which every order to destroy Farben was being 
aborted, but named some of those individuals in the O. M. G. set-up 
in Germany whom he believed to be responsible for this ghastly 
repetition of the sabotage of Allied control of this same German 
dye trust in the years following World War I. 

Among those Mr. Nixon indicated had taken the attitude that 
the Morgenthau plan was hysterical or impracticable were Am- 
bassador Robert D. Murphy, representing the State Department; 
General William H. Draper, Director of the Economics Division; 
Col. E. G. Pillsbury, control officer; Major Petroff, former attor- 
ney for General Motors; Laird Bell, Chicago attorney who had 
been outspoken in his disagreement with Potsdam and J. C. S. 
1067; and Col. Joe Starnes, former member of the noxious Dies 
Committee of the House of Representatives who, when defeated 
for reelection, was rewarded with a commission in the Army and 
as a member of the O. M. G. urged that the de-Nazification order 
should be ignored and German industry should be started. 

Mr. Nixon went into some detail regarding the peculiar actions 
of Col. Carl B. Peters, former president of Synthetic Nitrogen 
Products, director of Chemnyco, and an official of the Advance 
Solvents Corporation, all Farben subsidiaries, who was quietly re- 
moved from Germany for engaging in numerous relations with 
high I.G. Farben officials. 

Col. Peters, Swiss-born American citizen and a Major in ord- 
nance during World War I, was active in the chemical industry 
and took a leading part in Farben's false front set-ups in the United 
States. Then in 1939 he was indicted in two of the synthetic nitro- 
gen ammonia cases which were kept secret from the public and 
later were mysteriously nolle pressed. And on September 5, 1941 
he was defendant in the civil complaint and consent decree involv- 



398 TREASON'S PEACE 

ing the same conspiracy with Farben to restrain synthetic nitro- 
gen production. Colonel Peters reentered the Army and was sent 
to Germany originally by Mr. Crowley's Foreign Economic Admin- 
istration, coming to grief as Mr. Nixon stated, when United States 
Counter-intelligence decided that his relations with Farben per- 
sonages were improper and indicated that he looked forward to 
renewed inter connections between Farben and American interests. 

Readers may ponder at this typical example of the familiar pat- 
tern, of the way a man who served Farben purposes during the 
pre-war period in its American fronts and was thus personally in- 
volved in court actions for conspiracy against this country, should 
then have been commissioned in the Army and sent by Mr. Crow- 
ley to help carry out the destruction or control of I.G. Farben's 
war machine in Germany. 

While Senator Kilgore was making a direct attack upon the Far- 
ben conspiracy, one other robust member of the Senate, the Hon. 
Joseph O'Mahoney, Wyoming Democrat, had been approaching 
some aspects of the Farben mess by indirection with an insistent 
demand that the Government of the United States take a forthright 
position on the total abolishment of all international cartels par- 
ticularly those by which Farben had disarmed this nation and its 
other victims. 

In May, 1945, Senator O'Mahoney held public hearings before 
Senate Committees which were considering cartel legislation, and 
his first two witnesses, Attorney General Francis Biddle and As- 
sistant Attorney General Wendell Berge, distinguished themselves 
by expressing conclusions that executives of the corporations who 
signed and carried out the illegal tie-ups with Farben were inno- 
cent of any attempt to injure the national security and did not 
present any moral problem in so doing. 

This gratuitous effort to apply a coat of official whitewash to 
men whose acts had contributed to obstructing the national de- 
fense, was more remarkable in view of Mr. Biddle's admission 
that some of those same individuals were parties to carry-over 
agreements through which the illegal agreements were already 
being resumed. And Mr. Berge's friends and admirers were cha- 
grined when he ignored official records to the contrary, and ex- 
pressed the absurd opinion that the United States Government 



TREASON'S PEACE 399 

had "no knowledge" of Standard Oil's partnership agreements 
with Farben during the thirteen-year pre-war period. Out of my 
own high admiration for Wendell Berge let it be said that who- 
ever induced him to put such statements into a public record was 
not a real friend of this kindly gentleman. 

Leaders of the oil industry also appeared, including Orville 
Harden, vice-president of Standard Oil of New Jersey, and other 
executives of that company each to express, quaintly, their bitter 
opposition to cartels. They each appeared at first to hate these 
infamous arrangements. Then the words nevertheless, however, 
and but would creep in, in a way which indicated that just pos- 
sibly the speakers were afraid that perhaps we could not afford 
to be too harsh in future about such tie-ups with foreign com- 
panies. The oil magnates put on a good show. 

On the last day of these hearings Senator O'Mahoney called on 
me, as an authority on cartels and I.G. Farben, and thus made it 
possible to put into a Senate record a few of the pertinent facts 
(which now may be found in this book) about the vicious political 
influence by which I.G. Farben during the pre-war era had so 
profoundly molded opinion and policy inside Germany and also 
in other countries, including the United States. 

I utilized this opportunity to refute the earlier allegations of 
Messrs. Biddle and Berge that none of their so-called innocent 
American industrial cartelists knew that the national security was 
involved in their partnerships with Farben, and that the United 
States Government was not informed about these illegal agree- 
ments until after Germany began the war. The documentary proofs 
which I cited to disprove the Biddle-Berge allegations were re- 
ceived in painful silence, especially those which clearly indicated 
that the political influence of I.G. Farben might have been re- 
sponsible for the innocuous results of flabby Anti-Trust Law en- 
forcement against those whose tie-ups with Farben did weaken 
our national security. 

It was merely a coincidence, but surely a pleasant one, that Mr. 
Biddle resigned from his position as Attorney General the day 
after my testimony recorded some of the weird results of his tenure 
of that office. However, rumor had it that he had been slated to go 
ever since former Assistant Attorney General Norman Littell 



400 TREASON'S PEACE 

forced into the record some of the proofs relating to Mr. Biddle's 
relations with Thomas Corcoran. 

How and why Francis Biddle under these circumstances later 
wound up as the United States member of the Nuremberg Court 
by appointment of President Truman remains a mystery on which 
the readers of this record may well ponder. 

As the aftermath of having thus placed on a record of the Senate 
for the first time evidence that the political influence of I.G. Far- 
ben had been reaching inside the Government of the United 
States, the printing of the record of these hearings was held up 
for months, while parts of my testimony were suppressed. 

However, it developed that the Wyoming Senator was unwilling 
that political influence of I.G. Farben should prevent his col- 
leagues in the Senate, and the public, from reading testimony on 
that same political influence of I.G. Farben which had been re- 
corded before his Committee. Thus, in the final printing of these 
hearings, there appeared a- reproduction of my 1931 Chart or 
Flow Sheet (described in Chapter vn) showing I.G. Farben's 
control in that early pre-war era, of our munitions industries, its 
influence on our press and our government. Thanks to the courage 
of Joe O'Mahoney, this proof that it was then known what Farben 
had planned for ten years later, became a public record fourteen 
years after it had been sent to members of the Congress. 

On December 12, 1945, after Colonel Bernstein's public testi- 
mony, Senator Kilgore, in an off-the-record conversation with me, 
expressed his indignation at incidents which I related as illustra- 
tions of Farben's influence in security immunity for some of its 
Amercan stooges. I was then advised that I would be called back to 
Washington as a witness before the Kilgore Committee. Instead, 
a letter from the Senator advised me that the public hearings were 
discontinued and would I kindly send him a written statement 
to be printed with the Committee's other testimony? 

On December 21, 1945, a few days after our private conversa- 
tion on Farben's political influence, Senator Kilgore issued a ring- 
ing public statement dealing with this same subject of influence. 
And in restrained but unmistakably critical language the Senator 
discussed the conduct of affairs in occupied Germany with this 
query: 



TREASON'S PEACE 401 

For what private and selfish ends are our national security 
and the security of our allies placed in jeopardy? 

He became more specific as he continued: 

The attitude of these military government officials is an out- 
growth of their connections with industrial and financial en- 
terprises whcih had close pre-war ties with the Nazis. 

His statement also named some of the same O. M. G. officials 
mentioned in the Nixon testimony, but unfortunately Senator Kil- 
gore did not bring out clearly the basic issue of Farben's continued 
political influence inside government at Washington, where obvi- 
ously the real resonsibility lay for putting into the O. M. G. men 
who would deliberately sabotage the orders issued by General 
Eisenhower to smash I.G. Farben. These men did not appoint 
themselves to office. 

As one way to remedy the silence on this issue I included in the 
statement which the Senator had requested for his Committee's 
hearings some of the ample proofs available that the most dan- 
gerous aspect of the German war potential was the political in- 
fluence of Farben inside the Government of the United States. In- 
cidents, a few of the many in this book, were recited. 

My medicine was too strong for Senator Kilgore the heat was 
on for what he had already put into the record. My statement 
was returned with advice that it could not be published because: 
"It is not the policy of the Sub-Committee to make charges against 

individuals " ( which was a rather peculiar allegation in view 

of the charges against members of the O. M. G., and many others 
made in the Kilgore Committee Hearings ) . Tactfully, the Senator's 
letter added: 

"I am not questioning your veracity." 

Friends of the Senator then complained to me that I was caus- 
ing him embarrassment. Be that as it may, his probe of I.G. Far- 
ben had already caused such dismay and resentment that no ap- 
peasement policy would suffice and the Kilgore Committee's in- 
vestigations were marked for the same end as those of the Bone 
Committee. 

Following Mr. Nixon's testimony in February, it was announced 



4O2 TREASON'S PEACE 

that witnesses from the State Department would appear before 
the Kilgore Committee to refute the Nixon charges. But no such 
witnesses appeared. Instead, the Audit and Contingent Expenses 
of the Senate reached out to strangle Senator Kilgore's brave effort 
to defeat the Farben revival plot, by cutting the appropriation for 
his Sub-Committee to a fraction of the sum required. 

This is not to imply that this action, by the Senators involved, 
was not motivated by a desire for economy or was influenced by 
the I.G. Farben lobby. 

While the tug-of-war was going on in the United States Senate 
between the save-Farben and smash-Farben teams, important con- 
tributions were made by those two valiant battlers, Representatives 
Voorhis of California and Coffee of Washington. Among the sev- 
eral forceful speeches by Mr. Voorhis touching on the I.G. Farben 
tie-ups in the United States was that delivered on May 21, 1945, in 
support of his House Concurrent Resolution 55, which demanded 
that the Government prevent the economic financial or technical 
resources of Germany from rebuilding the future war potential 
of the enemy in any other nation, and to prevent any citizens or 
corporations of the United States taking any action "through cartel 
agreements or otherwise" which would contribute to the rebuild- 
ing of that future war potential. 

Again on July 20, 1945, Mr. Voorhis complained bitterly that: 

Some of the very people who hold top positions in the Ameri- 
can Control Commission in Germany are men who either in 
the past or at this very moment are officials of American com- 
panies who had connections with some of the very Ger- 
man companies which the Senate (Kilgore) Committee has 
warned about 

Mr. Voorhis also put his finger on the issue by saying that: 

To select men with connections of this sort and to pass over 
the thousands of other American businessmen whose com- 
panies never had any such connections is, to put the matter 
very mildly indeed, a mistake which may have the most seri- 
ous consequences for the future peace of the world. 



TREASON'S PEACE 405 

Representative Coffee also has a long and notable record of 
well-documented and forthright attacks upon the cartel as an in- 
stitution and I.G. Farben tie-ups in particular. On October 4, 
1945, while Colonel Bernstein's battle against the sabotage of the 
directives to destroy Farben was at its height in Germany, Mr. 
Coffee delivered in the House a blasting attack upon I.G. Farben 
political influence in which he paid me the honor of referring to my 
own efforts, citing among other things my expose of the way the 
Geneva Economic Conference in 1927 was influenced by Farben's 
Dr. Lammers.* Mr. Coffee then put into the record his own views 
on the way Farben influenced both international and our own 
domestic affairs, including the following: 

We have all, I think, felt the impact of such influence here 
at Washington, at times like these, when investigation and 
legislation which may affect any cartel activities is under dis- 
cussion, or pending. Then it is that some visitor in plain lan- 
guage some lobbyist attempts his persuasions with quaint 
sophistries, or more subtle argument. Now what essential dif- 
ference can anyone point out between the lobbyist or fixer- 
exerting pressure here at Washington or in Europe in our re- 
construction set-up, in 1945, for cartel survival; and Farben's 
Dr. Lammers at Geneva in 1927 successfully persuading that 
international assembly not to act against the cartel. 

In the light of events since then, which are known to all of 
us, it may be admitted that should the Geneva Economic Con- 
ference in 1927 have protested at the evils of the cartel, and 
had it even raised the lid a fraction of an inch to peer within 
the Pandora's Box of I.G. Farben. then those beastly, tragic 
human ills, which later were loosed from that casket of evil 
and death, might not have brought us, now, to a war and a 
victory so dearly won with the blood of American youth. In 
1927 I.G. Farben's leaders had to prevent action by the 
League, so Farben's distinguished Dr. Lammers was on the 
spot to do so. 

Who shall dare to say that some other Dr. Lammers, dis- 

* In monograph, The Cartel, published in the Encyclopedia Americana, 
1945. 



404 TREASON'S PEACE 

guised in sheep's clothing as a learned technical adviser, or in 
the raiment of an apostle of democracy and peace, has not 
been around Washington to advise anyone so credulous as 
to listen to him; or is not among those who at this very time 
are in Europe to help decide on the spot what to do about 
saving German industries, or what punishment, if any, shall 
be meted out to guilty German industrialists. 

The eloquent Representative summed up his conclusions with: 

the one great national and international issue which 

the cartel presents to us at this time, and which we must face 
before it is too late, is that of the cartel's political influence, 
as we see it now revealed in preparation for this war, and as 
it must be met if its impact upon the next peace is to be im- 
munized. We have won the war in Europe and in Asia, but are 
we doing those things which must be done if we are to win 
the peace, while the friends and allies of I.G. also plan and 
connive in secret to reconstruct their private cartel super- 
state? Remember, too, that much of the propaganda which 
clandestinely attempts to foment discord among the Allies in 
this war and in this peace has its origin and its motivation 
among the adherents of another era of world cartelization. 

These references to the influence which might effect what pun- 
ishment, if any, shall be meted out to guilty German industrialists 
are a reminder that up to the time this is written there appears no 
record of the indictment or the punishment of any officer or em- 
ploye of I.G. Farben, in Europe, save for the gentle protective 
custody in which some of them have been held, until they were 
released by influences exerted upon subordinate officials in the 
O. M. G. ' 

As one of the few columnists who wield an objective pen and cite 
names and facts on the I. G. Farben problem, Tom Stokes followed 
up Jerry Voorhis' expose in the House with a series on the same 
subject, of the official folly of putting men in the O. M. G. in Ger- 
many to eradicate Farben who were officers of American -Com- 
panies tied in with I.G. Farben and in some instances under in- 
dictment for such offenses. 



TREASON'S PEACE 405 

One of those identified by Stokes in his column of May 26, 1945, 
was Col. Frederick Pope, who had been with the Office of War 
Mobilization before being selected as Chairman of the F. E. A. 
Committee on Chemicals which prepared that section of Mr. 
Crowley's Program for German and Industrial Disarmament (al- 
ready mentioned). 

Without questioning Mr. Pope's high standing as an industrial 
engineer, or the good faith of his recommendations relating to the 
peacetime control rather than the destruction of Farben's produc- 
tion of war chemicals, Mr. Stokes pointed out that Mr. Pope was 
a director or official of more than one of I.G. Farben's American 
affiliates. 

These have included Mr. Pope's directorship of the American 
Cyanamid Company (fined $10,000 in April, 1946, for conspiring 
with I. G. Farben ) and of the Southern Alkali Co. ( defendant in 
action filed in 1944 for conspiracy with Farben in the alkali in- 
dustry) and prior to 1939 Mr. Pope was also closely associated 
with the Farben subsidiary Synthetic Nitrogen Products Co., along 
with Col. Carl Peters, which company's record has also been 
presented. 

The press in general, as has been mentioned in earlier chapters, 
continued its customary reluctance to publish all of the real truth 
which came out of Germany. 

As the struggle inside of the O. M. G. proceeded, between those 
like Bernstein and Nixon who wanted to be harsh, as ordered, 
with Farben, and those opposed, there were increasing protests 
from news correspondents stationed in our occupied zone in Ger- 
many that either direct censorship or indirect pressure was mak- 
ing it difficult to send back home the real facts on what was going 
on behind the scenes. Correspondents of even the conservative 
New York Times joining in these protests justify a belief that they 
were well grounded. It remains fortunate that Messrs. Bernstein 
and Nixon, when they returned to the United States, resisted such 
efforts to silence them as we may be quite sure were made. 

This may be the appropriate place to cite that dramatic incident 
which took place in the courtroom in New York on June 6, 1945, 
when, as told in Chapter xvm, Farben's chief Counsel, Dr. August 
von Knieriem, flown from Frankfurt, in custody in a military plane, 



406 TREASON'S PEACE 

was produced as a surprise witness by Philip Amram, Assistant 
Attorney General, and testified regarding the celebrated fake 
agreement made by Standard Oil of New Jersey with Farben at 
The Hague in September, 1939, after Germany had invaded 
Poland. 

Dr. von Knieriem produced from the Farben files a signed copy 
of the so-called Hague agreement which he identified as his own 
original, and on its margin in his own handwriting there were 
numerous notations made at the time to explain the various clauses 
in the agreemerit. One of these conclusions recorded by Farben's 
chief legal adviser in 1939, when the Farben leaders' vision of 
world conquest held no possibility of the tragic revelations in 1945, 
was a short pungent phrase in German which, translated, shouted 
out the fraud and the confident expectation of a future renewal of 
the mesalliance between Farben and Standard. The words were 
"Post-War Camouflage." 

We may well ask how much of the contemptible double talk 
and worse relating to Farben which has been uncovered comes 
within lawyer von Knieriem's definition of camouflage to deceive 
the Government and the people of the United States. 

James S. Martin, previously mentioned in Chapter xv, suc- 
ceeded Mr. Nixon as control officer for I.G. Farben in the Ameri- 
can Military Government for Germany. After he had appealed 
for the establishment of another tribunal to try the guilty indus- 
trialists, Mr. Martin was permitted to organize a unit to be de- 
voted specifically to the de-cartelization of Farben and its affiliates. 
However, the efforts of this group to eliminate Germany's in- 
dustrial war potential appeared to be restricted to surveillance 
and control of the so-called peacetime economy, which, since 
Potsdam, the higher ups had found so conveniently elastic and 
expandable. 

Meanwhile, as the trial of Nazi leaders at Nuremberg pro- 
ceeded, many Americans sought in vain for some sign that punish- 
ment would be inflicted upon the Farben leaders who were in the 
custody of the American authorities. The criminal acts of these 
men had again been established by countless original documents 
uncovered in their own files, as not only responsible for Hitler 
and Hitler's armed might and the weakening of Germany's victim 



TREASON'S PEACE 407 

countries, but also as directly involved in some of the most beastly 
deeds of the Nazi regime. 

These included such acts of criminal depravity as direct par- 
ticipation in the Nazi slave labor practices which had their origin 
"in the blackest periods of the slave trade," by which Farben war 
plants had been manned with forced labor of hapless captives; in 
manufacturing and knowingly supplying the deadly poison gases 
used to murder millions of helpless humans in the death chambers 
at Auschwitz ( Oswiecim ) ; and, after these mass murders, in the 
conversion into fertilizer of the ashes remaining from the crema- 
tion of the corpses. 

It so happens that ample evidence of all these unbelievable 
practices was produced at the trial and recorded in the final 
judgment of the Nuremberg Tribunal. 

With relation to this evidence of depravity, it may be men- 
tioned that Georg von Schnitzler, called by some the No. 2 Farben 
criminal, admitted to our O. M. G. officials long before the Nurem- 
berg trials began that he, and other Farben directors, had known 
that poison gases manufactured in a Farben plant were being 
used to murder human beings in the Nazi concentration camps, 
and did nothing about it save to continue the supply. 

However, at Nuremberg all this evidence was not related to 
the guilt of Farben's leaders they were not on trial. The senile 
Krupp was the only one indicted who was publicly identified as 
an industrialist (with side-door ties to Farben). He was not even 
tried. 

And, as the trial dragged on, the slimy Schacht, close associate 
of Farben, and involved in Farben's pre-Hitler preparations for 
war, but usually referred to as a mere financier, boasted com- 
placently that he would not be convicted. 

To some it may have seemed strange indeed that there were no 
Farben figures in the Nuremberg dock, especially in view of 
earlier insistence of United States Prosecutor Robert H. Jackson 
that some of them should be. The indictment, where it dealt with 
certain vital aspects of aggressive war for which Hermann Schmitz 
and his associates obviously were responsible included the fol- 
lowing: 



408 TREASON'S PEACE 

The Nazi conspirators, and in particular the industrialists 
among them, embarked upon a huge rearmament program 
and set out to produce and develop huge quantities of ma- 
terials of war, and to create a powerful military potential 

Dr. Schmitz, indicted in the United States in 1941, remained 
untried for those offenses; and at Nuremberg he was not even 
indicted with other and lesser criminals. 

In view of the record thus summarized it is not surprising that 
on May 1, 1946, former Secretary of the Treasury Henry Morgen- 
thau, Jr., broadcast a denunciation of the State Department pol- 
icies on elimination of Germany's war potential, with careful anal- 
ysis which included this positive statement: 

We have failed to de-industrialize Germany. 
The speaker then reflected the views of many others by saying: 

It is still not clear to me whether Mr. Byrnes intends to scrap 

the Allied program of Quebec, Yalta and Potsdam If 

it is Mr. Byrnes' intention to scrap the Potsdam pact and allow 
Germany to remain industrially powerful, then I prophesy 
that we are simply repeating the fatal mistakes of Versailles, 
and laying the foundation for World War III. 

Mr. Morgenthau's query to Secretary Byrnes was a voice crying 
in the wilderness of synthetic public clamor which demanded 
the survival of German industry of Farben. This appeal was dis- 
guised in a confusion of many voices, of hysterical pleas for a 
starving Germany and fears of a Russian menace. 

In July 1946, Russia's Molotov had made an obvious public 
bid for the favor of an unrepentant Germany. Then late in August 
Lieutenant General Lucius D. Clay, Deputy Military Governor 
of the American Zone in Germany, contributed what may appear 
as the first of a series of answers to Mr. Morgenthau's query. As 
reported, General Clay's statement included inaccurate and rather 
naive allegations that Germany no longer had any physical war 
potential of her own and could only be a threat if some other 
power with the industrial wherewithal used her as a mercenary. 



TREASON'S PEACE 409 

A week later, on September 6, 1946, Secretary of State Byrnes 
made his counter-bid for the friendship of the prostrate nation in 
a broadcast at Stuttgart, in which he threw overboard all pretence 
of implementation of the plan to eliminate Farben's war potential 
which the Potsdam conference had decreed. 

In double talk decrying the oversight that no allowance had 
been made in fixing levels o industry for reparations and a self- 
supported Germany, Mr. Byrnes assured his listeners of a balanced 
industrial economy to be controlled by trained inspectors, and an 
export-import program out of which reparations ( and industrial 
profits ) might come. 

Described in the press as America's bidding against Russia for 
German favor, columnist Edgar Ansel Mowrer aptly called it 
Byrnes' plan "to fight fire with fire," while expressing the vain hope 
that "we come through unharmed." 

And Upton Close complacently termed it "a cardinal principle 
of democracy," and "a reminder to the Reich that we recognize the 
right of every nation to govern itself." 

The Secretary of State then returned to the Paris Peace Con- 
ference and his bi-partisan foreign policy which, whatever else 
it may or may not be, does have the unqualified approval of that 
good friend of Standard Oil's late Mr. Parish, Democratic Senator 
Tom Connally, and the learned legal adviser of Farben's Mr. 
Halbach, Republican statesman John Foster Dulles. 

President Truman, nudged rather violently on foreign relations 
by the man he had displaced as Vice-President, then publicly 
indicated his full support of the policies of the Secretary of State. 

With another swift turn of the wheel, one more completed de- 
sign in the pattern of things to come was unfolded when, on Sep- 
tember 30, 1946, the Nuremberg Tribunal handed down its verdict 
convicting the Nazi riffraff and military gangsters, but acquitting 
both Franz von Papen and Hjalmar Horace Greeley Schacht. 
Subsequently mysterious press reports intimated that Francis 
Biddle, as American Judge, had voted to convict Schacht. How- 
ever, Mr. Biddle declined to say how he voted. The Judgment 
states "The Tribunal finds Schacht not guilty . . ." Of the four 
Judges, American, British, French and Russian, only the last 
dissented. 



410 TREASON'S PEACE 

The dissent of Russia's Judge J. I. Nikitchenko appears as an 
understatement when he declared that: 

Schacht's leading part in the preparation and execution of 
a common criminal plan is proved. 

In the light of damning facts, showing the involvement of 
Schacht, which were recited in the verdict itself, he was obviously 
guilty on Counts 1 and 2 of the indictment, of: 

participation in a common plan or conspiracy to com- 
mit crimes against peace in the planning, initiation or 

waging of a war of agression. 

But after reciting the evidence of Schacht's guilt the judges who 
wrote the weasel-worded acquittal then accepted the Schacht alibi 
that he "didn't know" that the rearmament for which he and his 
Farben associates were responsible was intended for aggressive 
war. The naive judges who concocted this decision attempted 
to justify the Schacht innocence on his plea that "when he 
discovered the Nazis were rearming for aggressive purposes he 
attempted to slow down the speed of rearmaments." 

So this close associate of Dr. Hermann Schmitz and other direc- 
tors of Farben and Vereinigte Stahlwerke, who sat with him on 
the board of the Reichsbank, went free on that moth-eaten alibi 
of Farben's allies: "I didn't know," despite a showing of guilt 
which included substantially each of the various offenses that can 
be proved against Dr. Schmitz and the rest of the Farben brood 
if and when these gentry are tried. 

So out of Nuremberg has now emerged the judicial dictum and 
high precedent behind which immunity for the leaders of Farben 
may be made secure. 

Disheartened, Robert Jackson (who five years earlier, as Attor- 
ney General, had complained of the "pattern" of non-military 
invasion which interfered with "law enforcement itself), was 
quoted as agreeing fully with the Russian dissent. "I'd rather see 
any man but Schacht get off," said the American prosecutor, and 

"the further prosecutions of industrialists which have been 

planned, will have to be studied from the text of the opinion." 

What he might have said was that it now had become an almost 



TREASON'S PEACE 411 

futile task either to indict or to try the Farben criminals. Unless 
an outraged public opinion when the truth is revealed will smash 
down the pattern of immunity which has protected war criminals 
of two world wars. 

With his acquittal, many of Schacht's close friends outside Ger- 
many, industrialists, financiers and politicians, breathed in relief 
from the fear that had been haunting them; fear that the vengeful 
tongue of a Schacht, if convicted, would have spilled the beans; a 
fear now abated because stupid men on a high bench had been 
persuaded to say that Schacht's guilt had not been "established 
beyond a reasonable doubt." 

A verdict so bad that it outraged many of the German people 
themselves may give rise to the query whether the Nuremberg 
trial was arranged to provide a jucticial warning of the hangman's 
noose to gangsters who may plan aggressive war in future; or to 
provide judicial safe havens for respectable criminals who created 
the gangsters thus condemned a crowning example of the un- 
written law of the Farben jungle. 

Following quickly on the heels of the Schacht fiasco was the 
announcement of an official economic mission to study the possi- 
bility of advancing United States Government funds to German 
industry to implement its controlled peace-time economy by a 
revival of the German import-export trade. This mission was 
headed by George Allen, as director of the Reconstruction 
Finance Corporation, and Howard C. Peterson, Jr., as assistant 
Secretary of War. 

Time will reveal whether any Farben plants or Farben affiliates 
now in dire need of financial aid will be judged as deserving it 
by Mr. Allen, friend of Victor Emanuel, and director of Farben's 
General Aniline; or by Mr. Peterson, former member of the Cravath 
law firm which represented Farben, and official successor of that 
other ex-Cravath firm lawyer, John J. McCloy. 

Then came a significant resignation at Nuremberg. Abraham 
Pomerantz, distinguished American attorney and Prosecutor of 
the industrial war criminals (who had asked me to serve as his 
advisor on I.G. Farbea) quit the job in protest at the calibre of 
the Judges designated to try these cases. 



412 TREASON'S PEACE 

Other reports, not confirmed, indicated that Dr. Herman Abs, 
one of the most powerful of Farben's directors, had been im- 
munized in the British Zone, where he was acting as adviser to 
the English officials; and that Fritz Thyssen, safe in his pleasant 
quarters on the Island of Capri, was also immune from prosecution. 

Meanwhile Schacht announced that he had a plan to solve "Ger- 
many's economic problems." Thyssen had already produced his 
plan for a German corporate state in his true-confessions book. 
And surely the Geheimrat Hermann Schmitz, with the help of 
nephew Max Ilgner and of Georg von Schnitzler, could supply a 
plan if not convicted. 

Schacht-Thyssen-Schmitz what a team that would be to re- 
build German's peace time economy, and direct it jointly with a 
select group of Anglo-American industrialists, financed with Ameri- 
can taxpayer's funds! 

The foregoing constitutes a small part of the record, and of the 
proofs available that the conspiracy to save the Farben war crim- 
inals from punishment, to revive the Farben structure, and to 
renew the Farben carry-over tie-ups, here and elsewhere, is pro- 
ceeding on schedule. 

Just as Max Ilgner told his criminal associates in 1944 that it 
would be, this plot is proceeding in the pattern of another false 
peacetime tragedy which, in reality, is another intermission for 
rebuilding of a superstate and another era of secret preparation 
for World War III. 

N That the same influence which reaches into high places to make 
a treason's peace is also active in promoting friction among the 
victorious Allies of World War II may be in some respects the 
most dangerous manifestation of that cancer in the vital organs of 
government. 

That Great Britain under Attlee, as under Churchill, has fa- 
vored a soft peace for Farben and has changed little from its pre- 
war dependence upon cartel trade restrictions, and that Moscow 
has severely criticized the Anglo-American policy of hard talk and 
soft action regarding Farben has been apparent in many news 
items coming from London, from Berlin and from Moscow. 

This book is not the place for appraisal of the post-war relations 
between the United States and Great Britain on one side and Rus- 



TREASON'S PEACE 413 

sia on the other, nor to comment on the manners and tactics of 
Moscow or the pin prickings and vacillations of Washington. 

It is, however, within the purposes of this book to point out that 
ample proofs have been recorded here of many aspects of the pat- 
tern of I.G. Farben which show a purpose always to divide and 
conquer, and that this pattern very definitely traces its slimy 
threads into the sabotage of the eradication of I.G. Farben's war 
potential by the same influences inside the Government at Wash- 
ington which have been pressing our foreign policies and our stand 
in the United Nations away from a possible rapprochement with 
Russia. 

The arguments heard that the recrudescence of Germany's 
armed might by a revival of Farben's industrial war potential may 
be desirable to provide a buffer, or a threat, to Russian expansion 
(call it imperialism, or demand for security as you will) appear 
as cockeyed and as vicious as would be a demand for the reor- 
ganization of Max Ilgner's spy ring in South America in order to 
help us protect the Panama Canal. 

Readers of this book may perceive emerging now the shadow 
of the Frankenstein's monster rebuilt by folly, or by treason- 
no less alive in now socialistic Britain than in capitalistic United 
States. This creature may introduce that culmination of final world 
conquest for which Farben's leaders have already planned and 
made possible two World Wars. 

Of what avail a victory at arms, with its ghastly sacrifice of 
sweat, and blood, and tears; of youth destroyed, or warped, or 
wrecked if out of it shall come another peace of Farben's pattern, 
a peace disguised this time as a union of nations to rule by force, 
by the atomic bomb, if you will, with men of Farben's choice to 
make up that super-state? 

If that shall be the sacrifice and the victory and the profit, then 
this ghastly price will have been paid merely to yield our own 
destinies, and those of all the world, to the tender mercies of a 
supreme corporate state guided by men of Farben's choice; a 
union of nations, as a super-world-government, which, call it by 
what name you will, in reality will be the consummation of the 
world conquest planned by faceless Farben figures to be consum- 
mated by Farben's faithless dupes. 



CONCLUSION 



Democracy at its worst and at 
its best 



THIS, THEN, IS THE PATTERN 
of Farben, as it has appeared and re-appeared before and during 
two world wars and as that same pattern has already re-appeared 
in the peace. 

This story has been cut in length and cut again, in order to 
bring it within the covers of this book. For lack of space many 
facts which should be told have been omitted here. But those 
which are presented are sufficient to show that the people of this 
nation must clean their own house of Farben before hoping to 
instruct other peoples of the world how to eradicate for all time 
this obstacle to an enduring peace. 

The accusation of muckraking which will be made has its own 
reply in the fact that those who claim to be accused by this story 
may not again plead ignorance of the facts presented here, facts 
which bear so vital a relation to the peace which is to come. 

There will be those who will allege that Pan-Germanism and 
4*4 



TREASON'S PEACE 415 

the Teuton lust for world conquest were conceived and thrived 
many centuries before the era of modern warfare and the German 
dye cartels. I reply that since the age of modern war began all 
of the so-called military groups of Germany, including the Prus- 
sians and the Junkers, would have been helpless without the mu- 
nitions supplied by Farben; nor have those groups ever had any 
important influence inside the United States save that created 
through Farben s pattern of conspiracy as revealed in this story. 

It is not necessary to conclude that some of those named here 
were knaves and some were fools, nor does the author so assert. 
And, just so, it must not be assumed that any individual, merely 
because his name appears in this story, is accused by the author 
of guilty acts or of guilty purposes. 

We may disregard all issues of intent, and on the sole issue of 
intelligence the reader is entitled to say whether leadership by 
men who thus did Farben s bidding must be rejected now, so that 
the pattern of Farben may be uprooted. Otherwise we will again 
be led astray by Farben s guile even before the grass grows green 
or the tears are dry upon the graves of those who have died and 
are dying now for the blind stupidity of those who would reject 
the lessons of World War I, and again of World War II. 

Grant that it be not treason, grant that it be not greed, it re- 
mains that unforgivable folly because of which men and women 
of America who hate war because they love liberty have thrust 
the bodies of sons and brothers, of husbands and fathers, twice in 
one generation before the war machine conceived by German 
science, in the hands of Farben outlaws, while Democracy's lead- 
ers sat shamelessly silent and now cry out "We did not know." 
I say that these leaders did know. I say that the facts assembled 
in this story should prove to all that those things which the Ger- 
man dye trust planned to do, and then did with the assistance of 
key men in its framework in the United States, had long been 
revealed as in an open book to those in high places who cared to 
listen or to examine the record. I say that those facts have been 
known -from the days of the dying Wilson Administration by lead- 



TREASON'S PEACE 

ers of high and low degree of all three branches of our Federal 
Government and by leaders in industry, in finance, and in public 
opinion. 

Somehow, the public has been kept in ignorance. A purpose of 
this book is to rectify that wrong. I say that the immunity which 
these men of Farbens pattern have enjoyed and which still en- 
duresshall not prevail unless these facts remain concealed. These 
facts must be made known now, this pattern must be recognized 
NOW, if final disaster is to be averted. 

To those who may protest that I overdraw my canvas I say that 
the youth of this generation have had this war to fight because 
they and many of their elders were not permitted to learn in time 
the facts told here. Is this to happen again while they those who 
have come back move on from youth and their sons in turn shall 
liave another war to fight because the spawn of LG. Farben again 
shall make a mockery of those two keystones of human liberty, 
free speech and free press? 

I say that those two phrases are futile, senseless words so long 
as they are subject not to statute, but to secret fiat or corrupt sub- 
servience. I say here that much of the responsibility for the tragic 
era of two senseless, wicked wars is upon those who for any 
reason have refrained from revealing such facts and their mean- 
ing to the people of this nation. Perhaps that era came to a close 
when fortune and enduring faith at the end of a long and dreary 
path has finally resulted in this publication of the story of that 
pattern which survives in war and endures in peace. 

This is the story of democracy at its worst. The fact of its tell- 
ing h&re without restraint of censor, and despite opposition from 
high places is democracy at its best. 

FINIS 



N D 



X 



Those names listed below have been identified from official sources as 
companies located in the United States which, at some time during 
the period between the two world wars, had financial relations, patent 
agreements or other alliances involving direct or indirect ties with I.G. 
Farben. 

Many of those named here are not mentioned elsewhere in the book. 
The list has been compiled solely to illustrate the width and depth of 
I.G. Farben's penetration in American industry. Identification here, as 
was stated at the end of Chapter iv, does not imply impropriety or 
illegality in relations with I.G. Farben by the company thus named. 

In those companies marked with asterisk ( * ) Farben is reported to 
have had a controlling financial interest, or relations approximating 
control. In those marked with dagger (f) Farben is reported to have 
had a limited or minority financial interest. 



Abbott Laboratories 
Acetol Products Co. 

* Advance Solvents & Chemical 

Corp. 

* Agfa Ansco Corp. 

* Agfa Photo Products Co. 

* Agfa Raw Film Co. 

* Alba Pharmaceutical Co. 
Allied Chemical & Dye Corp. 
Aluminum Company of America 
American Active Carbon Co. 
American Bemberg Corporation 
American Cyanamid Co. 
American Enka Corporation 
American Glanstoff Corporation 



* American I.G. Chemical Cor- 

poration 

* American Magnesium Corpora- 

tion 
American Potash & Chemical 

Corporation 

American Solvent Recovery Cor- 
poration 

American Window Glass Com- 
pany 

American Zirconium Company 
Anaconda Sales Company 
Anglo Chilean Nitrate Corpora- 
tion (N. Y.) 

* Ansco Photo Products, Inc. 

417 



TREASON'S PEACE 



* Antidolor Company 
Atlantic Refining Co. 

Ayerst, McKenna & Harrison 
(U. S.) Ltd. 

Baker & Co. 
The Barrett Co. 
Bamsdall Corporation 
Bayer Company, Inc. 
Bayer-Semesan Co. 
BeU and Howcll Co. 
Bernuthe Lambecke Co. 
Berst-Forster-Dixfield Co. 

* Board of Trade for German 

American Commerce, Inc. 
Bohn Aluminum & Brass Co. 
Borden Company 
Bradley & Baker 
Bristol Myers Co. 

Calco Chemical Company 
California Alkali Export Asso- 
ciation, Inc. 

Carbide & Carbon Chemicals 
Corporation 
Carnation Co. 
Carter Oil Co. 
Casein Company of America 
L. D. Caulk Company 

* Central Dyestuff & Chemical Co. 
Central Scientific Company 

* Chemical Marketing Co. 

* Chemnyco, Inc. 

Chilean Nitrate and Iodine Sales 

Corporation 

Chilean Nitrate Sales Corpora- 
tion (N. Y.) 

Chipman Chemical Engineer- 
ing Co. 

Church & Dwight Co., Inc. 

Ciba Company, Inc. 



Cincinnati Chemical Works 
Cities Service Co. 
Climax Molybdenum Co. 
Columbia Chemical Co. 
Commercial Pigments Co. 

* Consolidated Color & Chemical 

Co. 

Continental Oil Company 
Cook-Waite Laboratories 

R. B. Davis Company 

Davis Emergency Equipment 

Company 

Diamond Alkali Company 
Diamond Match Company 
Dow Chemical Company 
Drug, Inc. 
Dry Milk Company 
duPont Cellophane Company 
f E. I. duPont de Nemours Co. 

Eastman Kodak Company 
Ellis Flotation Corporation 
Ellis-Foster Company 
Ethyl Gasoline Corporation 

Federal Match Co. 
Ferrocart Corporation of Amer- 
ica 

* Fezandie & Sperrle 
Firestone Rubber Company 
Fitchburg Yarn Company 
Fleischmann Company 
Ford Motor Co. 

Freyn Engineering Company 

Gasoline Products Company 
Geigy Company, Inc. 

* General Aniline & Film Corp. 

* General Aniline Works, Inc. 
General Chemical Company 



TREASONS PEACE 



General Drug Co. 

* General Dyestuff Corporation 
General Electric Company 
General Mills, Inc. 
General Motors Corporation 
General Motors Research Cor- 
poration 

General Tire and Rubber Co. 
Glidden Company 
Goodyear Tire and Rubber Co. 
William Gordon Corporation 
Grasselli Chemical Company 

* Grasselli Dyestuff Corporation 
Greene Cananea Copper Com- 
pany 

Gulf Oil Corporation of Penn. 

Gulf Refining Company 

Hercules Powder Co. 

Hoffmann-LaRoche, Inc. 

Hooker Electrochemical Com- 
pany 

Household Products, Inc. 
Hutz & Joslin (law firm) 
f Hydro Carbon Synthesis Cor- 
poration 

Hydro Engineering and Chem- 
ical Company 

Hydro Patents Co. 

Imperial Chemical Industries 
(N. Y.) Ltd. 

Indiana Condensed Milk Com- 
pany 

Interchemical Company 

International Catalytic Oil Proc- 
esses Company 

International Hydro Patents 
Company 

International Match Company 

International Nickel Company 



419 

Interstate Chemical Company 
of Rhode Island 

* Jasco, Inc. 

M. W. Kellogg Company 
Kennecott Sales Corporation 
Kerr Dental Manufacturing 

Company 
Koppers Company 
Koppers Construction Company 
Krebs Pigment and Color Cor- 
poration 

'Kuttroff Pickhardt and Com- 
pany 

Lautaro Nitrate Company, Ltd. 

Lever Bros. 

Life Savers, Inc. 

Louis K. Liggett Company 

Lion Match Co. 

Loose- Wiles Biscuit Company 

* Magnesium Development Cor- 

poration 

* Marion Company 
Mathieson Alkali Works (Inc.) 
Mead Johnson & Company , 
Wm. S. Merrell Company 
Metal & Thermit Co. 

* H. A. Metz Company 

* Metz Laboratories 

Mid Continent Petroleum Cor- 
poration 

Molybdenum Corporation of 
America 

Monsanto Chemical Company 

National Aniline & Chemical 

Company 
National City Company 



420 



TRE ASO N*S PEACE 



National Distillers Corporation 
National Distillers Products 

Company 

National Lead Company 
Nestles Milk Products Company 
New Jersey Zinc Company 
New York Match Company, Inc. 
Niagara Alkali Company 
North American Rayon Corpor- 
ation 

Ohio Match Company 
Okonite Company 
Oldbury Electro-Chemical Com- 
pany 
Owl Drug Co. 

* Ozalid Corporation 

* Ozaphane Corporation of Amer- 

ica 

Pacific Alkali Co. 
Parke Davis & Company 
Penn-Chlor, Inc. 
Pennsylvania Salt Manufactur- 
ing Company 
Pet Milk Company 
Phillips Petroleum Company 
Pittsburg Plate Glass Company 

* Plaskon Company, Inc. 
Polymerization Processes Cor- 
poration 

Proctor and Gamble Company 
Pure Oil Company 

Remington Arms Company, Inc. 
Richfield Oil Company of Cali- 
fornia 
Rohm & Haas Company, Inc. 

Sandoz Chemical Works, Inc. 
Selden Company 



Semet-Solvay Company 
Shawinigan Chemicals, Ltd. 
Shell Chemical Co. 
Shell Development Corporation 
Shell Union Oil Company 
Sinclair Refining Company 
Skelly Oil Company 
Socony- Vacuum Oil Company 
Solvay Process Company 
L. Sonneborn & Sons, Inc. 
Southern Alkali Corporation 
E. R. Squibb & Sons 
Standard Alcohol Company 
Standard Brands, Inc. 
Standard Catalytic Company 

t Standard I. G. Company 

f Standard Oil of California 
Standard Oil Development Com- 
pany 

f Standard Oil Co. of Indiana 
Standard Oil Co. of Louisiana 

f Standard Oil Co. (New Jersey) 
Standard Oil Co. of New Jersey 
Standard Oil Co. of New York 
Standard Oil Co. of Ohio 
Standard Oil Co. of Texas 
Stauffer Chemical Company 

t Sterling Products, Inc. (Now 
Sterling Drug, Inc.) 

* Synthetic Nitrogen Corp. 
Synthetic Patents Co., Inc. 

Texaco Development Corpora- 
tion 

Texas Company 

Three-in-One Oil Company 

Titan Company, Inc. 

Titanium Pigment Company, 
Inc. 

Transamerican Match Company 



TREASON'S PEACE 



421 



Uniform Chemical Products, Inc. 

Union Oil Company of Cali- 
fornia 

Union Carbide and Carbon Cor- 
poration 

United Drug Company 

United States Alkali Export As- 
sociation, Inc. 

United States & Transatlantic 
Service Corporation 

United States Rubber Company 

Universal Match Corporation 

Universal Oil Products Com- 
pany 

Urbain Corporation 

Vacuum Oil Company 
Vegex, Inc. 



Vernon-Benshoff Company 
Vernon-Morner Company 
Vick Chemical Company 
Virginia Chemical Company 
Viscose Company 
Visking Corporation 
Vulcan Match Company 

West End Chemical Company 
Westvaco Chlorine Products 

Corporation 

West Virginia Match Corpora- 
tion 

Winthrop Chemical Corporation 
Wisconsin Alumni Research 

Foundation, Inc. 
Wyandotte Chemical Company 



INDEX 

(Names of firms listed in the Appendix which do not appear in the 
text are not included* in the Index.) 



Abbott Laboratories, 225, 335 
Abs, Dr. Herman J., 412 
Academy of Political Science, 386 
Actien Gesellschaft fiir Aniline Fabri- 

kation, see Berlin Company 
Advance Solvents & Chemical Co., 56, 

63> 259, 397 
Agfa Ansco Corp., 25, 28, 65, 79, 80, 

83, 108, 271, 356 

Agfa Company, German, see German 
Agfa Photo Products Co., 64 
Agfa Raw Film Corp., 64 
Aichelin, Hans, 79 
Alba Pharmaceutical Co., 43, 80, 105, 

106, 130, 172, 174, 228, 356, 360 
Albert, Dr. Heinrich, 16, 17, 19, 21, 

289 

Aldrich, Nelson, 10 
Algiers, 381 
Aluminium Ltd., 330 
Aluminum Company of America 

(Alcoa), 65-67, 324, 330-332, 348, 

350 

Allen, George Edward, 367, 411 
Allen, James, 174, 307 
Allen (Robert M.), see Pearson & 

Allen 

Allen, Robert McDowell, 43 
Allied Chemcial & Dye Corp., 29, 36, 

46, 225, 332, 337-338, 346, 348 
Allied Military Government for Ger- 
many (A.M.G.), 384 
Allied Reparations Commission, 34, 

385 
Allies, 34, 71-72, 317, 382, 384-385, 392- 

393. 397 404 

Ambruster, Howard Watson, 5, 11, 
26-27, 3* 36-37 42, 96, 100-102, 

117-118, 121-122, 138, 142, 156-158, 



160-165, 169, 179-180, 193, 203-206, 

213, 220-221, 223-224, 231-239, 306- 

312, 319, 324, 334, 352-358, 360, 369- 
37' 375. 39 1 399"4oi, 403 
Ambruster, Ursula (Mrs. H. W.), 204, 

239 
American Bar Association Canons of 

Professional Ethics, 175 
American Bemberg Co., 296 
American Bosch Co., 368 
American Bottlers Association, 318 
American Business Survey (Pub.), 318, 

3*9 

American Car & Foundry Co., 10 
American Chemical Society, 59, 194 
American Cyanamid Co., 338, 348, 405 
American Dyes Institute, 36 
American Fellowship Forum, 294, 295 
American Foreign Trade Association, 

282 

American Home Products Co., 225 
American I. G. Chemical Corp., 25, 
28, 29, 49, 67, 70, 75, 76, 79, 104, 
105, 107-124, 136, 146, 151, 196, 276, 
282, 319, 331, 337, 364 
American Institute of Chemists, 305 
American Magnesium Corp., 65, 83, 

130, 332 
American Medical Association 

(A.M.A.), 43, 181, 234, 238, 240 
American Medical Association Coun- 
cil on Foods & Nutrition, 43 
American Medical Association Coun- 
cil on Pharmacy & Chemistry, 210, 
211, 213, 216, 228, 229, 239, 240 
American Medical Association divi- 
sion on food & drugs, 213 
American Medical Association, Journal 
of (pub.), 205, 210, 215-216, 229, 
231-232, 239, 248 



482 



INDEX 



4*3 



American Medical Association New & 
Non-Official Remedies (pub.), 210, 
216-217 

American Potash & Chemical Co., 346 

American Retail Federation, 127 

American Surety Corp., 297 

American Viscose Co., 144 

American Zone in Germany, 405, 408, 
411 

Amram, Philip W., 341, 406 

Anaconda Copper Co., 343 

Andrews, Harvey T., 152 

Anglo Iranian Oil Co., 53 

Anilinas Alemanas Co., 258, 260, 263 

Ansco Photo Products Co., 64 

Antidolor Company, 40 

Appelby, Paul, 206 

Arbeitsfront, 178 

Argentina, 178, 243, 252, 258-260, 266, 

304 

Armistice, 33-34, 61, 79, 190 
Army "E," 215, 219 
Arnold, Thurman (Wesley), 44, 124, 

142, 144, 157, 170-174, 180, 187, 189. 

222-223, 261-262, 276, 307, 310-311, 

3i9> 331-332. 344. 350-35L 375-376 
Asia, 227, 404 
Association of National Advertisers, 

246 

Atabrine, 3, 106, 217-221, 223-227, 360 
Atlantic Monthly (mag.), 223 
Attlee, Prime Minister (Clement 

Richard), 385, 412 
Auhagen, Friedrich Ernst, 294-296 
Aul, C. A., 99 
Auschwitz (Germany), 407 
Austin, Warren R., 355 
Austria, 54, 72 
Axis countries (powers), 106, 125-127, 

171, 221, 266-267, 270 

Badische Anilin und Soda Fabrik 

(Badische, German), 2, 12, 17, 25, 

34. 36-37. 72. 84, 91 
Badische, New York, 81-82, 92, 259, 

276, 296 
Baldwin, Beech & Mermey, 220, 317- 

3i8 

Baldwin, William, 317-318 
Ball, Joseph H., 167-168 
Bank of International Settlement, 70 
Barbour, W. Warren, 192, 329 
Barkley, Albein W., 208, 307 
Barnes, Dr. Harry Elmer, 204 
Barney, Dr. L. F., 234 
Baruch, Bernard M., 232, 391 



Basel, Amos S., 323 

Basle, Switzerland, 105 

Battle, George Gordon, 13 

Bayer (name), 240 

Bayer Aspirin, 38, 228-231, 233-237, 
239-241, 246, 255-257, 265, 267, 319 

Bayer Aspirina, 257 

Bayer Cafiaspirina, 257-258 

Bayer Company, American, i, 8, 9, 
16, 18-19, 37-39, 43-45. 65, 71, 79, 
80, 94-97. 99. 126. !53 158-159. J 72, 
175, 215-216, 228, 259, 269-270, 289- 
290, 294, 297, 383 

Bayer Company, English (British), 98, 

334 

Bayer Company, French, 98 
Bayer Company, German, 2, 7, 12, 20, 

3 8 -39> 45. 79. 94-95. 9 8 > 102, 216, 

254. 257. 262, 333-334 
Bayer Company Limited, Canadian, 

Bayer Company, New York, 95, 134, 
172, 178, 203, 216, 229-230, 232, 234- 
239, 241, 252, 257, 262, 319, 334, 348, 
356, 360-361. 

Bayer Cross, 258 

Bayer Semesan Co., 40 

Bayer, Tonica, 257 

Behn, Sosthenes, 297 

Behrens, H. F., 99 

Belgium, 30-31, 194 

Bell, Laird, 397 

Bennett, John J., 237 

Berge, Wendel, 356, 380-381, 398-399 

Berk, C. J., 291-292 

Berle, Adolph A., 260 

Berlin Company, 2, 12 

Berlin, Germany, 20-21, 29, 30, no, 
119, 124, 140-141, 178, 271, 279, 
285, 299, 332, 396 

Berlin University, 10, 137 

Berman, Herbert A., 337, 349 

Bernstein, Col. Bernard, 388, 395-396, 
400, 403, 405 

Bernstorff, Ambassador von, see von 
Bernstorff 

Biddle, Francis, 76, 88, 170, 172-179, 
256-257, 261, 267, 306-307, 309-311, 
314, 326, 333, 338, 353-355. 358-359. 
370-375. 398-400, 409 

Big Six, 2, 4, 6-11, 14, 34, 36, 40, 44, 
46, 79, 82, 95, 216 

Bilbo, Theodore G., 367, 388 

Bismarck (Prince Otto Eduard Leo- 
pold von), 29 

Black, Hugo L., 199, 368 



424 



INDEX 



Blair, Frank A., 44, 99, 139, 148, 
205, 208, 244 

"Bloody International" (book), 298 

Boal, Frank K., 25 

Board of Trade for German Ameri- 
can Commerce, 27-28, 77, 263, 281, 
284-291, 293-297, 300-301 

Board of Trade for German Ameri- 
can Commerce, Bulletin of, 28, 
263, 284, 286, 287, 291, 296, 301-303 

Bone, Homer T., 120, 186-187, 192^ 
221, 278, 297, 309, 319-322, 329, 344, 

349. 367. 379 

Book Review Digest (mag.), 303 

Borden Co., 335 

Bosch, Dr. Carl (Karl) (Professor, 
Doctor), 17, 25, 34, 45, 48, 50-51, 59, 
69, 72, 107, 109-111, 113-115, 130, 
141, 146-147, 150, 194 

Bosch, Carl (Karl) , Jr., 72 

Bosch Magneto Co., 72, 145-153 

Bosch, Robert, 72, 146-147, 150, 153, 
292 

Boyed, Capt., 148 ' 

Brazil, 30, 144, 257, 260, 266 

Breed, Abbott & Morgan, 123 

Bremen (SS), 293 

Brewster, Ralph (Owen), 166-167 

Bristol family, 41 

Bristol, Lee H., 246 

Bristol, Myers Co., 41, 133, 241, 246 

British Aluminium Co., 65 

British Blacklist, 259, 294 

British Empire, 57, 61, 201 

British Foreign Office, 396 

British Government, 15, 22, 53, 61, 
98 

British Intelligence, 283 

British Ministry of Economic War- 
fare, 125-126, 261 

British Navy, 15, 23 

British Order of Counsel, 22 

British Zone (in Germany), 412 

Bromley, Bruce, 328 

Brown Brothers & Co., 109 

Brugmann, Charles, 128 

Brugmann, Mrs. Charles (Mary O. 
Wallace), 128 

Bryan, William Jennings, 21, 294 

Bued, Dr. (Julius), 141 

Buenos Aires, Argentine, 178 

Bullitt, William C., 129 

Buna rubber, 53-55, 58, 275, 278- 
279 3 ! 9> 321-322, 340, 370 

Burns (William J.), 148 

Burpee, George W., 363 



Burritt, Dr. Norman W., 204, 207 
Butyl rubber, 53 

Byrnes, Jame^ F., 199, 387, 408-409 
Byoir, Carl and Associates, 292 

Cahill, John T., 169-172, 370 
Caldwell Company, W. B., 245 
Campbell, Walter G., 205, 208, 212- 

213, 242, 249-251 
Canadian Alien Property Custodian, 

334 

Canadian Courts, 333-334 

Canadian Industries, Ltd., 338, 345 

Capehart, Homer E., 388 

Capper's Weekly (pub.), 231 

Caraway, Thaddeus, 135, 153. 191. 
318 

Carol, King of Roumania, 30 

Carter, Burnham, 195, 197 

Cascarets, 39, 242, 264 

Cassella (Co.), American, 294 

Cassella (Leopold) G.m.b.H. in Frank- 
furt (Cassella), 2, 12, 36, 102 

Cassina, Count, 266 

Castoria, Fletcher's, 41, 246, 248-252, 
264-265, 268 

Castoria, Pitcher's, 250 

Centaur Company, 44, 139 

Central America, 134, 137, 265 

Chapman, Virgil, 203-204 

Chemical and Metallurgical Engineer- 
ing (pub.), 319 

Chemical Exchange Association, 16-17 

Chemical Executive Conference, 144 

Chemical Foundation, 98-99, 149, 199, 
306, 364 

Chemical Industry Advisory Com- 
mittee, 136, 138-140, 142-143 

Chemical Marketing Co., 281, 283, 

295 

Chemicals (pub.), 136, 138 
Chemists Club of New York, 16 
Chemnyco, Inc., 58, 75, 77, 81, 83, 

276-280, 284-285, 291, 296, 303, 331- 

332, 336, 356> 358, 397 
Chenery, W. L., 237 
Cheyney, Edward L., 66 
Chile, 34, 106, 266-267, 281 
China, 167, 344 
Choate, Joseph H., Jr., 9 
Churchill, Winston, 201, 259, 384, 412 
Ciba Company (American), (Swiss), 

338 

Cincinnati Chemical Works, 338 
Clancy, Howard, 239 
Clapper, Raymond, 133, 179. 248 



INDEX 



425 



Clark, Bennett, Champ, 192, 193 
Clark, Edward Terry, 132-135, 156- 

Clark, E. M., 53, 58, 111, 123 

Clark, Tom C., 338, 358-359 

Clark, Worth, 221 

Clay, Lieut. Col. Lucius D., 408 

Clayton, William L., 258, 391 

Climax Molybdenum Co., 343 

Close, Upton, 409 

Coca-Cola Co., 318 

Coffee, John M., 375, 402-404 

Colliers (pub.), 230, 237 

Colmer, William M., 389 

Colombia, 178, 263, 265, 281 

Columbia Broadcasting System 
(C.B.S.), 322 

Columbia University, 294 

Committee for Constitutional Gov- 
ernment, 290 

Committee on Political Economics, 
276 

Condor Air Line, 260 

Connally, Tom, 186, 309, 311, 320, 

409 

Continental Color & Chemical Co., 84 
Continental Dye Cartel (Farben), 46 
Continental Illinois Co., 109 
Cook Laboratories, 40, 217, 228 
Coolidge, Calvin, 42-43, 132, 134, 145 
Copeland, Royal S., 181-183, 199, 202- 

209, 234-236 

Copeland Service, Inc., 182, 207 
Copeland's Health Clinic, 235-236 
Corcoran, David, 165, 171, 264, 372 
Corcoran, Howard, 169 
Corcoran, Thomas G. (Tommy the 

Cork), 165-179, 213, 221-222, 226, 

262, 264, 267, 271, 310, 314, 333, 

369-375, 400 
Cosby, Clarence G., 235 
Cosmopolitan, Hearst's (mag.), 230 
Coster, Donald (Musica), 41-42, 169- 

170, 317 

Cotton & Franklin, 169 
Cotton, Joseph P., 166 
Cotton, William Henry, 80 
Courtaulds (Ltd., Samuel), 144 
Coward McCann, Inc., 303 
Coward, Thomas R., 303 
Cravath, de Gersdorff, Swaine & 

Wood (Cravath, Swaine & Moore), 

328-329, 345, 366, 370, 386, 41 1 
Crawfc-d, Kenneth G., 353 
Crim, John, see Krim 
"Critica" (newspaper), 252 



Crop Protection Institute, 91 

Crosley station, 236 

Crowley, Leo T., 85-86, 130, 155, 222, 

226, 359-362, 365-366. 368, 392-394. 

398, 405 
Cuba, 243, 317 

Cummings, Homer S., 129, 155-158 
Curran, Dr. Edward Lodge, 301 

Dalton, Dr. Hugh, 125, 126 

Danaher, John A., 221 

Daugherty, Harry, 145-146, 148, 150, 

156 

Daugherty, William T., 140-141 
Davis, Ewin L., 238, 239 
Davis, John W., 341 
Davis, William H., 363-364 
Dean, Sidney W., Sr., 136, 138 
Degener, Dr. Albert, 28, 287, 293, 296 
deKruif, Dr. Paul, 219-220 
Delahanty, Thomas W., 143 
Democratic Party, 28, 153-154, 156- 

166, 186-187, 192, 243, 266, 323, 368 
Denmark, 29 
Deutsche Gold- und Silberscheide 

Anstalt-A-G, 281 
Deutsche Reichsbank, 70 
Deutscher Verein, 291 
Deutscher Weckruf und Beobachter 

(pub.), 302 

Deutschland (submarine), 22-23 
Dewey, Thomas A., 85, 287 
Diamond Match Co., 346 
Dickinson, John, 157-158 
Dickstein, Samuel, 195, 198 
Diebold, Albert H., 39, 44, 98-99, 172, 

225, 254, 258, 264, 296 
Dieckhoff, Ambassador Hans Hein- 

rich, 296 
Dies, Martin, 195, 272, 281, 295, 297, 

308,311,375,397 
Dillon, Read & Co., 386 
Dinkelacker, Theodore, 296 
Dobson, John and James, 6 
Doermer, Justizrat Otto, 97, 99, 100 . 
Domei, Japanese news agency, 283 
Donovan, Col. William J., 134, 140- 

142, 144, 183 

Douglas, William O., 117, 121 
Dow Chemical Co., 65-67, 278-279, 

332. 35 

Dow (Dr. Herbert H.), Sr., 65 
Draper, Brig. Gen. William H., 386, 

397 

Drug, Inc., 41-42, 100, 133, 136, 156- 
157, 225, 233, 235-236, 241, 246, 267 



426 INDEX 

Drug Topics (pub.), 176 

Drug Trade News (pub.), 176, 211 

Drysalters Club of New England, 15- 

16, 19 
Duisberg, Dr. Karl (Carl), 38, 69, 71- 

7.2. 76-77. 94-96, 98, 102 
Duisberg, Karl Ludwig, 72 
Duisberg, Walter H., 66, 72, 77, 78, 83, 

86, 99, 102, 105, 115, 118, 263, 276 
Dulles, Allen W., 366 
Dulles, John Foster, 85, 87, 299, 300, 

347, 366, 409 
Dunbar, Dr. Paul, 212 
Duperial (S.A.) (Argentine, Brazil), 

379 
du Pont De Nemours & Co., E. I., 29, 

36, 40, 45-46, 50-54, 59, 60, 62-64, 83, 

no, 130, 139, 184, 189, 193-194, 278, 

3i5-3 l 7. 324, 326, 328-330, 332, 335, 
J 337-338, 344-346, 348, 379 
du Pont, Irene, 54, 189 
du Pont, Lammot, 50, 54, 139, 193 
du Pont, Pierre, 54 
Durrett, Dr. J. J., 209, 211 
Dutch East Indies, 106, 217, 320 
Dutch quinine syndicate, 220 
Dutch Shell Co., 56 
Dynamite, A. G. (D. A. G.), 60 

Earle, Admiral Ralph, 190 
Eastland, James Oliver, 388 
Eastland station (broadcasting), 235 
Eckler, Leopold, 80 
Editor & Publisher (Pub.), 247 
Edison, Thomas A., 16-17, 294 
Edmunds, James E., 283-284 
Eisenhower, General Dwight D., 342, 

385-387 

Emanuel & Co., 365 
Emanuel, Victor, 365-368, 411 
Emerson, Col. Ed., 296 
Empire Ordinance Co., 168-169 
English House of Commons, 201 
English House of Lords, 317 
English Parliament, 317 
Essary, J. Fred, 164 
Europa (SS), 293 
Europe, 30, 49, 56-57, 74, 77, 103, 

122-123, 142, 183, 200-201, 215, 255, 

304. 33L 344, 382, 389, 403-404 
Export Managers Club, 244 

Facts on Review (pub.), 292, 302 
Farben, I. G. (German I. G.), 2, 3, 
10-11, 18-20, 25-35, 40, 42-94. 96-99, 
101-118, S i2o-i27, 129-131, 133-134, 



1 37-iS9 140-146, 150, 156-162, 170- 
174, 176, 178-180, 182-183, 185-189, 
191-195, 197-201, 203, 205, 208-209, 
213, 215-223, 225-227, 229-231, 239, 
241, 243, 246-248, 252-260, 262-264, 
267-268, 270-281, 284-285, 287-289, 
291-293, 296-301, 303, 306-311, 313- 
316, 318-324, 326, 329-352, 356-372, 
375-378, 380-387, 389-393, 395-413 

Farbenfabriken vorm. Friedr. Bayer & 
Co. (Bayer) (Elberfeld), see Bayer, 
German 

Farbewerke vorm. Meister Lucius und 
Bruning (Hoechst), see Hoechst Co. 

Farley, James A., 156-157, 161, 163-166 

"Farma" companies, 256-257 

Farish, William S., 58, 186, 314, 320- 
321,324,339,409 

Fath, Creekmore, 221, 274, 320 

"Fatherland, The" (pub.), 301 

Felder, Thomas B., 146 

Ferdinand Andreas, Prince of Liech- 
tenstein, 296 

Fezandie & Sperrle, 259, 296 

Field, Marshall, 176 

Filene, Edward A., 127 

Fishbein, Dr. Morris, 43, 205, 210-211, 
213, 215-216, 219, 231, 234, 236, 238- 
240, 248 

Flender, Ernest W., 128 

Fletcher, Dr. (Charles H.) (Samuel), 

249 

Floyd, William II, 323, 380 
Flynn, Edward, 163 
Ford, Edsel B., 67, 109, 113 
Ford Motor Co., 66 
Fort, Dr. Arthur S., 234 
Foster, Raymond, 99 
Fowler, Henry H., 393 
France, 15, 36, 57-58, 98, 141, 144, 194, 

283, 381-382, 410 
Franco-German dyestuff agreement, 

142 
Frankfurt (a/Main Germany), 71-73, 

256, 277, 279, 283, 291, 321, 326, 332, 

344. 405 

Frankfurt Stock Exchange, 396 
Frantz, Harry W., 251 
Freytag, Heinrich, 293 
Frolick, Dr. Per K., 59 
Fulton, Hugh A., 369-371 

Gabler, Dr. Werner Karl, 127 
Gadow, Albert, 70 
Gallagher, Ralph, 323, 380 
Gannett, Frank, 247, ago 



INDEX 



47 



Gannett Newspapers, 247 
Garvan, Francis Patrick, 11, 12, 31, 38, 
91-93, 95, 145-153, 158. 189-190, 199, 
201, 269-270, 273, 305-306, 364 

Gattineau, H., 71 

Gearhart, Bertrand W., 222-223 

Geigy .Company, Inc. (American) 
(Swiss), 338 

General Aniline & Film Corp., 29, 46, 
56, 70. 75. ?8, 79- 81, 83, 85, 109, 
122-130, 155, 259-260, 269-271, 276, 
296, 328, 332, 335-339. 348, 35 6 . 359. 
361-364, 368, 411 

General Aniline Works, 28, 45, 78, 
80, 108, 122 

General Drug Co., 28, 242, 246 

General Dyestuff Corp., 25, 28, 45, 78, 
80-88, 91, 125-126, 130, 296, 307, 335- 
336, 338-339. 348, 35 6 . 362-363, 366, 
368 

General Motors Co., 50, 295-297, 397 

George, Walter F., 192, 308-309, 312 

Georgia State Medical Society, 234 

Gerard, James W., 165, 323-324, 383 

German Agfa Company, 64 

German Ambassador, 16, 18, 74, 282, 
296 

German Banks and their Concentra- 
tion in Connection with the Eco- 
nomic Development of Germany 
(pub.), 10 

German Embassy, 75, 146, 148-149, 
257. 293 

German Insurance Pools conspiracy, 
294 

German Library of Information 
(pub.), 292, 300, 302 

German Publishers Society, 18 

German Railroad Information Office, 
291, 293, 300 

German Steel Trust (Vereinigte Stahl- 
werke), 70, 102, 382, 386, 410 

German University League, 290 

German War Trade Board, 95, 102 

Germany, 1-8, 10-12, 15-25, 28-29, 3 1 . 
33-40, 43-48, 50, 51, 53-58, 60-62, 64- 
66, 70-76, 79, 81-84, 87, 91, 94-96, 98, 

100-104, 16> 109, 112, 118-119, 121- 
123, 125, 128-129, 134-37. 139-141, 
143-146, 148-153, 156, 158-159, 166, 
172-173, 175, 177-178, l8o-l8l, 183- 
184, 186-194, 197-198, 200-201, 215- 
2l6, 220, 222-223, 252-254, 256-258, 
26l, 263-264, 266, 268-274, 277, 279, 
282-283, 285-296, 298-301, 304-307, 
313-314. 317-319. S22-323. 330. 34L 



345. 347. 357-358. 360, 364, 372, 374, 
378, 382-393, 395-399. 401-402, 404- 
406, 408-413 

Gestapo, 74, 85, 258, 266, 272-273, 374 

Gillette, Guy M., 159 

Goebbels (Dr. Joseph), 196, 226 

Goff, Guy D., 26-27 

Gold, Mrs., 150 

Goodrich Rubber Co., 58 

Goodyear Rubber Co., 278-279 

Grasselli Chemical Co., 45, 138, 144, 

364 

Grasselli Dyestuff Co., 45, 83 
Great Britain (England), 3, 15-17, 19, 

21-23, 28, 30, 48, 125, 201, 243, 254, 

259, 282, 284, 289, 294-295, 301, 317, 

410, 412-413 

Green Cananea Copper Co., 343-344 
Greif, Dr. Wilfrid, 108-109, 114, 276 
Greutert & Cie, Edward, in, 115-116 
Greutert, Edward W., 116 
Grimmel, Harry W., 80 
Gross, Dr. Herbert, 283, 296 
Grundy, Joseph R., 27 
Grynszpan, Herschel, 75 
Guyer, U. S., 195 

Haas, Otto, 62-63, 327 

Haber-Bosch patents, 59 

Haber, Dr. Fritz, 34, 72 

Haeuser, Dr. Adolph, 12-13, 21, 30-31, 

93 
Hague agreement (memorandum) 

(conference), 57, 320, 340-343, 406 
Hague convention, 17 
Hague, Mayor Frank, 161, 329, 368 
Haigh, George C., 99, 175, 265 * 
Halback, Elizabeth S. (Mrs. E. K.), 86 
Halback, Ernest K., 81-88, 91, 126, 

259. 296, 338, 363, 409 
Ham berg, 73 
Hamberg American (S.S. Line), 107, 

147, 272, 289, 292-293 
Hamilton, Dr. Aubrey H., 218-219 
Harden, Orville, 123, 399 
Harding, Warren G., 28, 38-39, 93, 

142, 145, 152-153, 288, 362, 371 
Hardy, Charles J., 10, 95 
Harold, Dr. F. X., 22 
Harris, Forbes & Co., 109 
Harrison, Earl G., 356 
Harvard University, 310, 396 
Haslam, Robert T., 48, 54, 58. 321- 

322, 380 

Hatch, Carl A., 369 
Hays, Kaufman and Lindheim, 148 



428 



INDEX 



Healy, Robert E., 122 

Hearst (William Randolph), 22, 150 

Heflin, (J.) Thomas, 282-283 

Heimenz, William, 43, 80, 99, 174-175, 
203 

Heins, Otto, 150 

Hemingway, Frank, 36 

Herlein, Professor (Dr. Heinrich Hor- 
lein), 254 

Hershey Co., 317 

Herty, Dr. Charles H., 31, 194 

Hess, Christian, 94 

Hey den Chemical Co., 294 

Hill, H., 141 

Hill, James, Jr., 174, 265, 318 

Hilles, Charles D., 134 

Hills, G. S., 265 

Hilton, Davis & Co., 225 

Hindenburg (Paul von IJeneckendorff 
imd von), 102 

Hitler, Adolph, 28, 33, 53-54. 56, 7- 
71, 73-74, 76, 102-104, 111, 173, 193, 
196, 199, 200, 253, 255, 273, 291, 293, 
304, 306-307, 366, 382, 390, 406, 409 

Hobby Shop, 132, 135 

Hobby, William P., 186 

Hockswender, Dr. Karl, 81, 276, 296, 

332. 336 

Hoechst Co., German, 2, 11-13, 28, 30- 
31, 73, 80, 93-94, 215-216, 328, 370, 

378 

Hoechst-Metz Co., 92-93 

Hoover, Herbert, 42, 77, 99, 100, 134, 
136, 138-140, 142-144, 154, 156-157, 
159, 166, 170, 183, 187, 291, 303-304, 

315 

Howard, Frank A., 48, 52, 54-55 57' 
58, 111, 114, 119-120, 124, 274-275, 

33> 339-343 
Howard, Henry, 138 
Hudson River Aniline Works, 94 
Hughes, Charles Evans, 170 
Hull, Cordell. 28, 126, 268, 294, 308, 

383 

Humble Oil Co., 58, 186 
Humphrey, W. E., 238 
Hunter, R. M., 278, 321 
Hutchinson, Walter R., 326-327 
Hutz and Joslin, 78, 270 
Hutz, Rudolph, 78-79, 126, 259, 270 
Hutz, W. H., 78, 270 
"Hygeia" (pub.), 43, 232 

Ickes, Harold L., 247-248 
I. G. Dyes, (German), 10, 34, 36-37, 40, 
64, 69, 71, 73, 80, 97-98, 145-146, 



154, 156, 188, igi, 200, 2l6, 269, 
297, 314, 383 

I. G. Farbenindustrie, see Farben 
Ilgner, Max, 71, 76, 196, 271, 276-279, 

285, 291, 397, 42-4i3 
Ilgner, Rudolph W., 76-77, 276-277, 

279, 284-285, 289, 291, 296, 303, 331, 

358 
Imperial Chemical Industries (I.C.I.) 

(of England), 62, in, 3 1 5'3 1 7> 3 26 > 

332. S3 8 , 344-346 379 
Imperial Chemical Industries (of New 

York), 346 
Independent Voters Committee for 

Roosevelt and Wallace, 166 
Indiana State Board of Health, 237 
Interessen Gemeinschaft Farbenindus- 
trie Aktiengesellschaft, see Farben 
International Aluminum cartel, 330 
International Manhattan Co., 109 
International Match Co., 346 
International Nickel Co. of Canada, 

85 347 
International Nickel Co. of New York, 

347 
International Nitrogen Association 

(cartel), 60, 116, 331, 366 
International Patent Convention, 184 
International Telephone & Telegraph 

Co., 297 
Internationale Gesellschaft fur Chem- 

ische Unternehmunger A. G., see 

Swiss I. G. 

I Paid Hitler (book), 382 
Isseks, Samuel S., 310-311, 372 
Italy, 194, 299 



Jackson, Robert H., 81, 126, 170, 330- 

33L 368, 376-377> 407* 4o 

Jacobs, Joseph, 219 

Jadwin, Stanley P., 99 

Japan, 106, 129, 200, 217, 299, 344 

Jasco, Inc. (Joint American Study 

Company), 52-58, 84 
enkins, Thomas A., 195 
ohnson, Judge Albert W., 328 
ohnson, Edwin C., 295 
ohnson, Herbert A., 290-291 
ones, Jesse, 226 
oslin, H. M., 78, 270 
bslin, Theodore G., 133, 315 

Kahle, Mrs. Dorothy Pickhardt, 128 
Kahn, Otto, 146, 151 
Kalle & Company, 2, 12, 64, 216 
Kalle, Dr. Wilhelm Ferdinand, 296 



INDEX 



429 



Kansas Medical Society, 234 
Kemper, James S., 286-288, 301, 304 
Kennecott Copper Co., 343 
Kennedy, Joseph P., 121 
Keppelmann, Alfred T., i, 7-9, n 
Kertess, Ferdinand A., 281-284, 294- 

296 
Kilgore, Harley M., 258, 297, 323, 330, 

349. 3 6 7> 39 -39i > 393' 395'39 6 39 8 

400-402 

King, John T., 145-146, 148, 151* 156 
King, William H., 23-25, 28, 153, 181, 

189 

Klein, Dr. Julius, 143 
Klumpp, Dr. Theodore G., 211, 213- 

214, 220 

Knox, Judge John C., 126 
Kny, Richard, 294 
Kohen, Charles, 132, 134, 135 
Kohler, Renata, 257 
Koch, Richard, 295 
Kramer, Charles, 195 
Krauch, Dr. Carl, 396 
Krebs, Richard (Jean Valtin), 272-273 
Krim,, John (Grim), 146, 148-149 
Krueger & Toll Co., 347 
Krueger, Ivar, 346-347 
Krupp (von Bohlen und Halbach, 

Gustave), 407 
Ku Klux (Klan), 100 
Kuhlmann Co. (French), 338 
Kuhn, Fritz, 296 
Kuttroff, Adolph, 84, 109 
Kuttroff, Percy, 87 
Kuttroff, Pickhardt & Co., 25, 37, 81- 

83, 91-92, 141, 276 

La Guardia, Fiorella, 293 

La Follette, Robert M., Jr., 350 

La Frentz, F. W., 297 

Lammers, Dr. Clemens, 403 

"La Razon" (newspaper), 252 

Lati Air Line, 260 

Latin America, 30, 63, 77, 86, 102, 
127, 165, 224-225, 246, 250, 252, 254- 
256, 261-266, 272, 319, 345, 358, 

371-372 
Latin American newspapers, 78, 178, 

253, 268, 318 
La Varre, William, 260 
Lea, Clarence, 208 
League of Nations, 45, 143, 403 
Leake, Lowell L., 120 
Lee & Co., J. Ivy, 196, 297 
Lee Higginson & Co., 109 
Lee, J. Ivy, 195, 197-198, 200, 292, 358 



Leipzig Trade Fair, 291 

Leishman family, Nancy-Louise, 30 

Lenz, Rudolph, 87, 339, 363 

Letts (Ira Lloyd), 152 

Leverkusen (Germany), 97, 242 

Lewis, Merton E., 146, 150, 152 

Liechtenstein, Prince, 296 

Life (mag.), 176 

Life Savers, Inc., 41, 133 

Liggett, Louis K., 41-42, 99, 101, 133, 

156-157 

Lilly & Co., Eli, 225 
Littell, Norman M., 257, 370-375, 399 
Loehr, Dr. Oscar, 279, 322 
London (England), 111, 114, 201 
Longworth, Nicholas, 3 
Luce, Henry, 176 
Lucas, Scott W., 185, 221, 367 
Luedtke, Willy, 296 
Lutz, George, 64 
Lyons, Leonard, 176 

Mack, Judge John E., 129, 155, 259 

Madrid, Spain, 73 

Magnesium, 19-20, 65-67, 77, 278, 313, 

319. 332-333' 336 
Magnesium Development Co., 66-67, 

81, 276, 296, 332, 356 
Maine Medical Association, 235 
Malaya, 320 
Mann, Dr. Rudolph, 38, 94, 96-99, 

103 

Mann, Dr. Wilhelm R., 254-255, 264 
Manss, Harvey M., 241 
Markham, James E., 86, 362-363, 366- 

368 

Martin, H. W., 87 
Martin, James S., 289, 297, 406 
Matheson, William J., 36 
Matthews, Dr. J. B., 375 
Matthews, T. S., 176 
Mayer, Judge Julius M., 92-93 
Mayer, Julius P., 289, 290 
Maywood Chemical Co., 281 
McCalls (mag.), 231 
McClintock, Earl L, 38, 43-44, 96, 98- 

99, 121, 125, 158-166, 170, 174, 178, 

203, 243, 253, 255, 258, 261, 265-267, 

309, 318, 361, 372 
McCloy, John J., 386, 411 
McCormack, Alfred, 386 
McCormack, John W., 195, 199, 293, 

358 

McFadden, Louis T., 192 
McFarland, Ernest W.,'i6o 



430 INDEX 



McGowan, Lord Harry (Duncan), 316- 

317 

McGraw Hill Co., 319 

Mclntyre, Rear Admiral Ross T., 224 

McKesson 8c Robbins, 41-42, 122, 169 

McKittrick, Thomas H., 70 

McNutt, Paul V., 213 

Mead, James M., 371 

Meaney, Judge Thomas F., 329-330 

Means, Gaston B., 146, 148, 150 

Meili, E. H., 296 

Melchett, Lord (Henry Ludwig), 317 

Metz, Col. Herman A., 11-13, 15, 18, 
20-25, 27-32, 40, 46, 83, 91-94, 98, 
109-110, 144, 151, 153-154' 184-185, 
189, 200, 203, 215-216, 228, 284, 288- 
289, 291, 294, 296, 303, 328, 378 

Metz Co., H. A., 11, 25, 27 

Metz Fellowship, 29 

Metz, Gustave P., 93 

Metz Laboratories, 28, 31, 80, 217 

Metz, Marie Luise (Mrs. Richard), 29- 

3<> 

Metz, Richard, 29, 30 
Meltzer, Bernard, 268 
Merck & Co., 224-225 
Mermey, Maurice, 220, 317-318 
Merrell & Co., Wm. S., 225 
Mexico, 30, 265 
Meyer, Eugene, 36, 192 
Michelson, Charles, 156-157 
Midland, Michigan, 65 
"Midol," 242-244, 246 
Miller, Thomas W., 145-146, 148-150 
"Mistol," 245 

Mitchell, Charles E., 109, 114-115 
Mitchell, William D., 153, 157 
Mitsui Company, 338 
Moley, Ray, 390 
Moll, Alfredo, 30, 259-260 
Molotov (Vyacheslav M.), 408 
Molybdenum Corp. of America, 344 
Mooney, James D., 295-297 
Moore, A. Harry, 206-207 
Moore, Hoyt A., 328-329 
Morgenthau, Henry M., Jr., 126-127, 

130, 269, 273, 284, 308, 384, 388, 

39 1. 4o8 

Morgenthau Plan, 384, 390, 397 
Morrison, A. Cressy, 143 
Moscow, Russia, 412-413 
Moses, George H., 146, 148, 150-151, 

181 

Mowrer, Edgar Ansel, 409 
Mullaly, A. L., 296 
Munich (Germany), IDS 



Munich (Germany), Stock Exchange, 

396 

Murphy, Robert D., 397 
Murray, John F., 99 

National Aniline & Chemical Co., 36, 

225 
National Broadcasting Co. (N.B.C.), 

233- 2 37 
National City Bank of New York, 

107-109, 126, 136, 170 
National Institute of Health, 218 
National Lead Co., 344-345 
National Research Council, 91, 226 
Navy E, 215, 219 
Nazi Chemical Chief, 396 
Nazi Defense Headquarters, 341 
Nazi Ministers, 342 
Nazis, 46, 71, 73-74. 76, 103-105, 125, 
128, 135, 166, 174, 176, 178, 193-194, 
197-199, 201, 220, 252-253, 257-261, 
263, 266, 268, 272, 281, 288-289, 291- 
294 297, 300-301, 341-342, 372, 374- 
375 381, 383 387-388, 390-391. 396- 
397, 401, 406-410 
Neuduck Castle (Germany), 102 
"Neues Deutschland" (pub.), see New 

Germany 

Neuralgyline Company, 39 
New Deal, 127-128, 159, 165-166, 177, 

179, 181, 390 

"New Germany," The (pub.), 293 
New Jersey Medical Society, 204, 206- 

208, 239 

Newspaper Guild, Washington, 353 
New York American, 22 
New York Daily News, 230, 301 
New York Evening Mail, 18, 290 
New York Herald Tribune, 134, 303 
New York Journal, 230 
New York Journal of Commerce, 139- 

140 

New York Post, 176, 380, 390 
New York Public Library, 164 
New York, S.S. (steamship), 107 
New York Staatz Zeitung, 292 
New York Stock Exchange, 41, 122, 

19 1 

New York Sun, 231 
New York Times, 49, 81, 126, 132-133, 

179, 230, 233-234, 303, 381, 405 
New York World Telegram, 222, 247- 

248 

Nikitchenko, Judge J. I., 410 
Nixon, Russel A., 396-398, 401-402, 

405 



INDEX 491 



Nobel Prize, 7* 

Noble, Edward J., 41, $67 

Non-Sectarian Anti Nazi League, 121, 

221, 306-308 
Non-Sectarian Anti Nazi League 

Bulletin, 307 

Norris, George W., 329, 374 
North Africa, 381-382 
North America, 72, 261, 268, 273 
North German Lloyd (SS line), 292- 

293 

Northwestern University, 29 
"Novocain," 216-217 
Nuremberg Court (Tribunal), 174, 

400, 406-411 

Nye, Gerald P., 192, 194-195 
"Nylon," 62, 64, 278, 379 

Ober Kommando der Wehrmacht, 

34 

O 'Goner, Herbert P., 238 
O'Connell, J. J., Jr., 129-130, 175, 277, 

335 

Ohio State University, 154 
O'Mahoney, Joseph, 398-400 
"Order of Merit of the German 

Eagle," 295 
Oswiecim (Ger.), 407 
Ozalid Corporation, 75, 84 
Out of the Night (book), 272 

Padover, Saul K., 389 

Palmer, A. Mitchell, 36, 145-146, 152- 

i53 *75 

Panama, 178, 218, 263, 304 
Panama Canal (Zone) , 263, 281, 413 
Pan-American Airways, 283 
Paris, France, 37, 58, 140 
Parke-Bernet Galleries, 132, 134 
Parke Davis & Co., 335 
Patman, Wright, 145 
Patterson, Robert P., 222 
Peace Conference, Paris, 409 
Peace Conference (Versailles), 142 
Peace Treaty (Versailles), 96 
Pearl Harbor, 129, 261, 265, 272, 299- 

300, 350, 376 

Pearson (Drew) and Allen, 172 
Pecora, Ferdinand, 122 
Pepper, Claude, 221 
Perkin, William H., 3, 217 
Peru, 30 
Peters, Carl B., 276, 331-332, 397-398, 

405 

Peterson, Howard C., 386, 411 
Petroff, Major (Igor), 397 



Petroleum Times, London. England 
(pub.), 321 

Pharma Chemical Co., 225 

Philadelphia, Penna., Record (news- 
paper), 247-248 

Phillips Milk of Magnesia, 41, 235, 
241, 246, 264-265 

Philippines, 218 

Pickhardt & Kuttroff, 84 

Pickhardt, William, 84 

Pickhardt, William Paul, 37, 83-84, 
276, 296 

Pickrell, Dr. Eugene R., 23-28, 151, 
284, 293-294, 296 

Pilot Insurance Co., 294 

Pillsbury, Col. E. G., 397 

Pinchot, Gifford, 237 

Pistor, Gustave, 332 

Pittenger, Dudley, 195 

Plainfield, New Jersey, Courier News 
(newspaper), 247 

Plaskon Corp., 84, 130 

PM (newspaper), 120, 176, 353, 367, 

Poland, 33, 76, 291, 406 

Pole, 75 

Pollard, John G. 237 

Pomerantz, Abraham, 411 

Pope, James P., 192 

Pope, Col. Frederick, 405 

Porter, Sylvia, 380, 390 

Potsdam Conference (agreement), 385, 

395. 397. 4o6, 408-409 
Poucher, M. R., 36 
Power Trust, 101 
Price, Byron, 387 
Price Waterhouse & Co., 42 
Printers and Publishers Association, 

18 

Printer's Ink (pub.), 318 
Proprietary Association, 44, 205 
Proprietary Association Committee 

on Advertising, 241 
Prussia, Ger., 29 
Public Health League of Washington, 

236 

Puetzer, Dr. Bruno, 80 
Pulitzer Prize, 176 

Quaker Oats Co., 335 
Quebec Conference, 384, 408 
Quimica Bayer Co., 258, 263 

Rayburn, Sam, 352 
Reader's Digest (mag.), 220 
Reagan, Daniel J., 140-141 



43* 



INDEX 



Reich, 90, 102, 382, 389, 409 

Reichsbank, 410 

Reichs-Landbund, 102 

Reichstag, 102 

Reiner, Dr. Robert, 294 

Remington Arms Co., 50, 60, 315, 345 

Renoe, John A., 238 

Rensselaer, N. Y., 18, 80, 97, 106, 214, 

272 
Republican (Party), 27-28, 42, 85, 99. 

101, 134, 142, 145-146, 153, 156, 159, 

161-163, l8l l8 7' 1 9 2 ' 287-288, 301, 

303-304, 347, 388, 409 
Rexall-Liggett Retail Drug Stores, 41 
Rheinisch Stahlwerke, 102 
Richard & Co., C. B., 128 
Richardson family, 41 
Ridder family, 292 
Ridder, Victor F., 297 
Riesser, Professor J., 10 
Rifkin'd, Judge Simon H., 345 
Ringer, Dr. Fritz, 57-58, 340 
Ritchie, Albert C., 238 
Robb, Arthur T., 247 
Robinson, Arthur R., 25, 110, 191, 

3i8 

Rogers, Edward S., 44, 96, 174, 213, 
219, 257, 265, 318 

Rogers, Hoge & Hills, 169 

Rohm, Ernst, 73 

Rohm, Dr., 62, 327 

Rohm & Haas, A. G., Darmstadt, 62, 
326, 328 

Rohm & Haas Company, Inc. (Phila- 
delphia), 62-63, 259, 284, 326, 328- 

33 

Rome-Berlin Axis Intelligence Serv- 
ice, 292 

Roosevelt, Franklin D., 126, 129, 134, 
156-157, 166-167, 237, 284, 374, 381, 
383-384, 389-390 

Ross Company, Sidney, 165, 171, 264 

Rumely, Edward A., 18, 43, 290 

Russell, Samuel, 24 

Russia, 14, 73, 80, 388, 408-410, 413 

Sadler, E. J., 313 
Sal the, Ole, 182, 203, 208-209, 212 
"Salvarsan," 215, 318 
Sandoz Chemical Works, Inc. (Amer- 
ican), (Swiss), 338 
Sargent (John G.), 152 
Sato, T., 283 
Saturday Evening Post (mag.), 220. 

23 1> 295 
Savannah Shipyards, 168 



Schacht, Dr. Hjalmar Horace Gveelev, 

407, 409-412 
Scheele, Dr. Walter, 18 
Schenk, Otto, 99 

Schenker, David, 112-113, 115-118, 122 
Schleswig-Holstein (Ger.), 29 
Schleswig-Holstein, Duke of, 30 
Schmitz, Dietrich A., 75-76, 115. 116, 
118, 120, 129, 263, 276, 296, 336-337 
Schmitz, Dr. Hermann (Geheimrat). 
(Justizrat), 28-29, 48. 69-71, 75-77, 
105, 107-111, 114, 116, 119-120, 124, 
130, 194, 254, 277, 332, 336-337, 407- 

408, 410, 412 
Schmitz, Ernst, 291-292 
Schnellbach, Wolfgang, 80, 272' 
Scholz, Herbert, 73-74 

Scholz, Mrs. Herbert (Lilo von 

Schnitzler), 73-74 

Schrader, Frederick Franklyn, 301-302 
Schreiner, Carl, 294 
Schroder Banking Corp., J. Henrv, 

296, 365-366, 368 
Schroder, Rockefeller & Co., 365 
Schroeder, J., 291-292 
Schroeder, Kurt von (Schroder), see 

von Schroeder 
Schwartz, Ernest, 79 
Schweitzer, Dr. Carl Hugo, 15-20, 23- 

24* 37. 43-44. 65. 7 1 ' 53> 21 5> 269, 

289-290, 294, 383 

Schweitzer Memorial Committee, 20 
Scripps Howard (newspapers), 176, 

179, 247-248,361 
Seebohm, Herman C. A., 71-72, 94, 

290 

Seebohm, Johanna (Duisberg), 71 
"Shall We Send Our Youth to War" 

(book), 302 

Sharpless Chemicals Co., 225 
Sheldon, James H., 307 
Shell Company, 52 
Shell Oil Co., 56 
Sherndal, Alfred E., 80, 93 
Simmons, Dr. George H., 216 
Simon, George W., 294 
.Smith, Dr. Edgar Fahs, 194 
Smith, Jesse W., 145-146 
Smith, Lawrence H., 371, 374 
"Society of International Industrial 

and Commerce Participation," 368 
Society for the Prevention of World 

War III, 308 

Solvay et Cie., Belgium, 346 
Solvay Process Co., 346 



INDEX 



433 



South America, 38, 44, 49, 72, 77, 106, 
125, 134, 137, 143, 174, 177, 252, 
258, 260-261, 264-266, 268, 272, 281- 
282, 331, 379, 413 

Southern Alkali Co., 405 

Spain, 73 

Spangler, Harrison E., 163 

Spanknoebel, Heinz, 293 

Sperrle, Oscar E., 296 

Springorum, H. W., 296 

Squibb & Sons, E. R., 225, 335 

Stafford, Franklin H., 86 

Stalin, Marshal Joseph, 384-385 

Standard Brands, Inc., 335 

Standard Gas & Electric Co., 361-362, 
365-366, 394 

Standard Oil Co. of California, 130 

Standard Oil Co. of Indiana, 130 

Standard Oil Co. Minority Stock- 
holders Committee, 323, 380 

Standard Oil Co. (New Jersey), (SO), 
42, 47-59, 63, 106, 113-114, 118-120, 
123-124, 130, 139, 144-145, 182, 186, 
207, 245, 259-260, 274-275, 278-279, 
313-314. 319-324. 339-343. 348 350, 
37. 375. 383. 399. 46, 409 

Standard Oil Development Co., 48 

Standard Power Co., 365 

Starnes, Joseph (Joe), 397 

Stearns & Co., Frederick, 225, 244 

Stein Bank of Cologne, Germany, 366 

Sterling-Bayer Company, 40, 96, 144, 
272 

Sterling Drug, Inc., 37 

Sterling Export Department, 78, 253 
262 

Sterling-Farben Latin American 
branches, 174 

Sterling Products, Inc., 29, 32, 38-45, 
71, 78, 94, 96-99, 103-106, 121, 124- 
125, 130, 133-134, 139, 158-159, 164- 
165, 168-180, 182, 186, 202-203, 207- 
209, 211-213, 216, 219-223, 225-226, 
228-229, 231, 234, 237, 239-262, 264- 
268, 271, 296, 307, 310, 317-319, 324, 
328, 333-335. 348, 356, 359-36i, 364, 

369-375 

Sterling Products International, 44 
Stimson, Henry L., 338, 388 
Stinnes Corp., Hugo, 367 
Stinnes, Hugo, 102 
Stock, F. J., 225-226 
Stokes, Thomas Lunsford, 176-178, 

222, 248, 309, 361-362, 404-405 
Stone, I. F., 367 
Stout, Chauncey F., 347 



Stripling, R. E., 375 
Sulfathiazol-Winthrop, 209-213, 216- 

217, 220, 228,148,278 
Sullivan & Cromwell, 85, 347, 366 
Sumners, Hatton (W.), 356 
Suter, Dr. Chester M., 29 
Swiss I. G. Chemie, 70, 108-109, 111- 

112, 114-115, 127-128, 130, 361, 363, 

368 

Swiss Minister, 128 
Switzer, Mary, 226 
Switzerland, 70, 108, no, 116, 123, 

130, 145, 199-200, 397 
Synthetic Nitrogen Corp., 25, 83-84, 

276, 296, 331-332, 356, 397, 405 
Synthetic Patents Corp., 37, 94 

Taft, William Howard, 30 
Tammany leader, 153 
"Tarnung," 89, 90, 288 
Tauscher, Hans, 148-149 
Taylor, J. Will, 195 
Teagle, Walter C., 48-51, 54, 58-60, 
109, 111-115, 118-120, 122, 139, 142, 

184. 339 

ter Meer, Dr. Fritz, 63, 99 
Textile Alliance, Inc., 7, 9, 37 
Thatcher, Dr. C. J., 190 
Thompson, Dorothy, 390 
Thompson, Dr. William O., 154 
Thyssen, Fritz, 70, 102, 382, 386, 412 
Time (mag.), 127-128, 175-176 
Titan Company, 344 
Titan Company A/S, Norway, 344 
"Today's Challenge" (pub.), 294 
Towey, Frank W. (Jr.), 207-208 
Transocean News Service, 272, 292, 

300 

Trojan Horse, 174, 305 
Trojan Horse, Foot Prints of (book), 

31.9 

Trojan Powder Co., 275 
Truman, Harry S., 27, 48, 120, 167, 

169, 186, 273, 297, 300-301, 303, 309, 

320, 322-323, 344, 349 
Tugwell, Professor Rexford Guy, 203, 

205, 247 

Union Carbide & Chemical Co., 143 
Union Club of Cleveland, 66 
Union of Democratic Control, 298 
United Drug Co., 41-42 
United Nations (Security Council), 71, 

220, 413 
United States, 1,4,5, 10-11, 14-16, 18- 

22, 24-27, 29-31, 4 45. 47-48, 51, 57- 



434 INDEX 

59, 62, 64, 78-80, 92, 94, 98, 101-102, 
104-106, 109, 127, 137, 143, 149, 197- 
198, 214-215, 217, 219, 240, 254, 256, 
261-262, 264, 266, 270, 280, 300, 322, 

325. 33i. 4i3 

United States and Transatlantic Serv- 
ice Corp., 276 

United States Chamber of Commerce, 
286-287 

United States Congress, 5, 11, 15, 18, 
23 9 6 H7 120, 122, 134, 149, 151, 
177, 184-185, 189, 200, 267, 271-272, 
282-283, 288, 290, 308, 311, 314, 337, 
355-356, 375-376, 379, 382, 387, 400 
Conference Committee (Congres- 
sional Conference), 208 
Congressional Committees, 27, 166, 

188, 205, 261, 289-290 
Congressional Investigations, 117, 

222, 368 

Congressional Hearings, 9, 12, 280, 

376 
Congressional Record, 188, 257, 295, 

32, 37 1 

Congress, Library of, 132 
Congressmen see Representatives 
House of Representatives, 159, 188, 

192-193' i99 204-205, 207, 221- 

223, 282, 299, 309, 375 

House of Representatives Commit- 
tee, 195, 203, 208 

House of Representatives, Commit- 
tee on Judiciary, 328, 353, 356 

House of Representatives, Commit- 
tee on Patents, 184 

House of Representatives, Commit- 
tee on Post War Planning, 389 

House of Representatives, Commit- 
tee on Radio, 238 

House of Representatives, Commit- 
tee on Rules, 375-376 

House of Representatives, Commit- 
tee on Un-American Activities 
(McCormack), 195, 198, 288, 358 

House of Representatives, Commit- 
tee on Un-American Activities 
(Dies), 272, 281, 295, 297, 308, 311, 

375' 397 

House of Representatives, Majority 
Leader, 358 

House of Representatives, Speaker 
of, 223, 352 

House of Representatives, Resolu- 
tions, 402 

Representatives (Congressmen), 20, 
24, 31, 145, 166, 185, 192, 198-199, 



203-204, 207-208, 222-223, 238, 
283, 308, 371, 374-375, 39> 397- 
402-404 

Senate, 26-27, 1 5 1 1 59> 162, 172, 
183, 188, 192-193, 199, 203-204, 

206-207, 221, 223, 270, 274, 282, 

309. 329, 351, 367. 372, 376, 400, 

402 

Senate Committee, 11, 20, 24-25, 30, 
146, 154, 194-195, 207, 209, 232, 
310, 321, 323, 369, 398 

Senate Committee Hearings, 23, 27, 
48, 233, 351, 368, 373 

Senate Committee on Audit & Con- 
tingent Expenses, 367, 402 

Senate Committee on Banking & 
Currency, 122, 192 

Senate Committee on Campaign 
Contributions, 159-162 

Senate Committee on Finance, 189- 
191 

Senate Committee on Foreign Rela- 
tions, 308-309 

Senate Committee on Judiciary. 
168, 308, 353, 398-400 

Senate Committee on Munitions 
Industry (Nye) , 187, 192-195, 199. 
298 

Senate Committee on National De- 
fense Program (Mead), 371 

Senate Committee on National De- 
fense Program (Truman), 120, 
167, 169, 186-187, 260, 297, 309. 
319-320, 322, 344, 349, 369-370 

Senate Committee on Patents, 215 

Senate Committee on Patents 
(Bone), 120, 185-187, 221, 223. 
252, 274, 278-279, 297, 309, 319- 

322, 329, 344, 349-351, 359, 367, 
379, 401 

Senate Committee on Petroleum 

Resources, 398-400 
Senate Document, 10 
Senate Majority Leader, 208, 307 
Senate Sub Committee on Lobby, 

25-26, no, 153, 180, 191, 199, 318 
Senate Sub Committee on War 

Mobilization (Kilgore), 258, 297, 

323. 349, 39 -39i > 393' 39&> 4<>o- 
402 

Senatorial Investigations, 100, 192 
Senators, 23-25, 146, 148, 150-151, 
153' 157' 166-169, 181-182, 185- 
187, 189, 191, 194-195, 199, 202- 

203, 205-209, 222, 235, 295, 307, 

309, 311-312, 318, 320-321, 323, 



INDEX 435 



3 2 9-33 . 35' 355, 367, 369, 374, 
387-388, 390-391, 393, 395, 398- 
402, 409 

United States Courts, 28, 205, 333 
Court Actions: 

Anti-Trust, 10-11, 77, 315, 325- 

339> 34.8-349* 373> 39 8 , 408 
Conspiracy Against the U. S., 328, 

33 i> 35 8 
Food & Drugs Act, 206, 217, 242, 

245, 282 
Food, Drug & Cosmetic Act, 214- 

215, 244-245, 250 
Foreign Agent Registration Act, 

266, 297 

Statute of Limitations, 329 
Trading with the Enemy Act, 281 
Court of Appeals (Federal Court of 
Appeals), (Circuit Court), 93, 202- 

203,331.375 

Court of Appeals decision, 212 
District Court (Federal District 

Court) , 29, 336 
District Court decision, 92 
District Court of New Jersey, 86, 

325-328 
District Court of New York, 92, 172, 

24. 328, 333, 341-342, 345, 405 
District Court of Boston, 145, 153 
District of Columbia Court of Ap- 
peals, 351, 375 
Federal Courts, 10-11 
Federal Judre, 76, 126, 325-327, 329- 

330, 341-342, 345 
Grand Jury, 77, 130, 149, 167, 171, 

177-178, 213, 262, 291, 328, 331, 

337 37i, 373-374 
Supreme Court, 199, 203, 346 
Supreme Court Decision, 297, 305, 

360 
Supreme Court Justice, 117, 170 

368. 376-377 

United States Government, 19, 20, 37- 
38, 54, 56, 83, 92, 95-97, ,18, 122- 
124, 126, 128, 135, 139-140, 144, 148- 
149, 168, 171-172, 174, 187, 189, 205, 
211, 252, 256, 261, 266, 271, 274, 280, 
290, 300, 314-315, 323, 327, 329-330, 
336-337, 340, 356, 376, 379, 398-402. 
411,413 

Agriculture, Department of, 206 
Agriculture, Secretary of, 206 
Agriculture, Assistant Secretary of 

205-206 
Alien Property Custodian (A.P.C.), 

12, 36, 38, 43-44, 59, 6a, 72, 8, 



84-88, 92-97, 126, 130, 145, 147- 
148, 150, 158, 175, 216, 222-224, 
226, 269, 277, 324, 333-334, 336, 

33 8 , 340-342, 346, 359-3 6 6, 368-369 
Alien Property Custodian, Office of, 

260, 360, 362, 364-365, 369 

Alien Property (Custodian, Vested 
Property Committee of, 284, 364 

American Ambassador, 384 

American Control Commission (in 
Germany), 402 

American Military Government (in 
Germany), see Office of Military 
Government for Germany (U.S.) 

American Prosecutor (at Nurem- 
berg), 377 

Army, 20, 24, 67, 71-72, 79, 218, 223, 
225-226, 271, 398, 405 

Army Counterintelligence, 398 

Army, General of the. 342, 385-387, 
401 

Army, Surgeon General, 218 

Army Officer, 31 

Army, Psychological Warfare Di- 
vision, 389 

Attorney General, 71, 126, 129, 140, 
145-146, 150, 152-153, 156-158, 
168, 170, 172-173, 177, 179, 185, 
189, 256-257, 261, 267, 306-307, 
309, 310, 311, 314, 326, 331, 337. 

339, 345, 352-353, 358-359, 370- 
374, 376-377, 398-399, 409-410 

Attorney General, Acting, 170-172 
Attorney General, Assistant, 134, 

257, 261, 307, 311, 341, 350, 357, 

370, 380, 398-399, 406 
Board of Economic Warfare 

(B.E.W.), 124, 219. 226, 250, 266, 

362, 380 

Black List, 127, 259-260 
Cabinet Members, 199, 289 
Commerce Department, 138-140, 

142, 144, 219, 260, 263 
Commerce Department, Bureau of 

Foreign & Domestic, 143 
Commerce, Secretary of, 136, 138, 

140, 142-143 
Co-Ordinator of Inter-American 

Affairs, 251 

Ellis Island, 79, 80, 272 
European Advisory Commission, 

383 
Federal Bureau of Investigation 

(F.B.I.), 74, 205, 266. 272, 277, 

283, 296 



436 



INDEX 



United States Government (Con*.) 
Federal Communications Commis- 
sion, 267, 316 

Federal Deposit Insurance Corpora- 
tion (F.D.I.C.), 130, 155, 368 
Federal Power Commission, 394 
Federal Reserve Board, 192 
Federal Security Administration, 

213, 226 

Federal Trade Commission, 32, 101 , 
122, 145, 215, 234, 238-241, 244- 

245' 3*9 
Food & Drug Administration, 205- 

206, 209, 211-214, 230, 244-245 
Food & Drug Commissioner, 208, 

211-212, 217, 249-250 
Foreign Economic Administration 

(F.E.A.), 362, 387* 392-393' 398- 

405 

Foreign Economic Policy Com- 
mittee, President's, 363 
Freezing Orders, 256 
Interdepartmental Committee of 

State, Treasury and Justice, 170, 

257 

Interior, Secretary of, 247 
Internal Revenue Official, 44 
Joint Chiefs of Staff (J.C.S.), 385, 

388, 397 

Judge (at Nuremberg), 409-410 
Justice Department, 42, 76, 81, 116, 
142, 144-146, 157, 167, 170-173, 
176, 178-179, 185, 213, 223, 252, 
258, 263, 271, 294, 307-3 9. 3H- 
315, 317, 321, 326-327, 332-334, 
336, 339' 347' 350, 352' 357-358. 
370-374. 381 
Justice Department, U. S. Attorney, 

169, 214, 370 

Justice Department Anti-Trust Di- 
vision, 124, 158, 170, 174, 177, 
213, 221, 278, 310, 330-33 1 ' 335- 
343' 346, 349' 35 !. 359 
Justice Department Anti-Trust Di- 
vision Patents & Cartel Section, 

337 

Justice Department Criminal Di- 
vision, 356 

Justice Department Immigration & 
Naturalization Bureau, 356 

Justice Department, Solicitor Gen- 
eral, 170, 177, 371 

Justice Department War Division, 
289, 297 

Justice Department War Policies 
Unit, 358 



United States Government (Con/.) 
Lend Lease, 55, 63, 167, 225, 263 
Navy, 67, 79, 218, 223, 225-226, 271, 

274' 295 

Navy, Surgeon General, 224 
Navy Ordnance Bureau, 190 
Office of Military Government for 
Germany (O.M.G.U.S.), 30, 385, 
393. 395-397. 401, 404-406 
Patent Commissioner, 184 
Post Office Department, 165 
President, 18, 38, 126, 129-130, 132- 
135, 144, 146-147, 153-154, i*99' 
204, 284, 288, 290-291, 294, 299- 
301, 303, 362, 367, 381-385, 387, 
400, 409 

Presidential Warrant, 126 
Presidential Proclamation, 127 
Prosecutor (at Nuremberg), 407, 410 
Public Health Service, 226 
Reconstruction Finance Corpora- 
tion, 165-166, 176, 367, 411 
Security & Exchange Commission 
(S.E.C.), 76, 111-112, 114-121, 123, 

334. 337' 365-366 

State Department, 37, 84, 124, 184, 
250, 258-260, 263, 266-268, 287, 
289, 294, 303, 358, 381-382, 387- 
389. 396-397. 402, 408 

State Department Anti-Peron Blue 
Book (pub.), 258 

State Department Foreign Funds 
Control, 268 

State Department National Social- 
ism White Book (pub.), 268 

State Department Peace & War Red 
Book (pub.), 268 

State,' Secretary of, 21, 28, 85, 126- 
127, 166, 173, 199, 268, 308, 383, 

387. 409 
State, Assistant Secretary of, 258, 

260, 391 
Treasury Department, 29, 75, 79-81, 

86, 88, 96, 124, 126, 128-131, 133. 

155. *73. 250, 259-260. 262-263, 

266, 270, 276-277, 284, 289, 333, 

335. 359-36o, 388, 395 
Treasury Department, Customs De- 
partment, 23, 28 

Treasury, Secretary of the, 127, 269, 

271, 277, 308, 384, 408 
War Department, 275, 387-388, 41 1 
War, Assistant Secretary of (Under 

Secretary), 222, 386, 411 
War, Secretary of, 338 
War Censor, 387 



INDEX 



437 



United States Government (Cent.) 
War Information, Office of (O.W.I.). 

174 

War Mobilization, Office of, 405 
War Production Board (W.P.B.), 

225-226 
War Production Administration 

(W.P.A.), 176 
White House, 127, 135, 156-157, 

165, 315, 362, 367, 372 
United States Laws (Statutes), 142, 
151, 170, 317 
An ti -Trust Laws (Sherman Act), 10, 

68, 75, 91, 144-145. 157-158, 183- 

184, 187, 189, 275, 314, 326-327, 

330^48, 358, 371-372,3^1,399 

Bankruptcy Act, 365 

Criminal Statutes, 130, 133, 149, 204 

Conspiracy Against the United 
States, 213, 357, 372 

Espionage Statutes, 373 

Federal Trade Commission Act 
(false advertising), 217, 231, 239- 
241, 244-245 

Enemy Property, 149, 181-182, 288 

Food & Drugs Act (Dr. Harvey 
Wiley's Law), 182, 202-206, 208- 
209, 217, 232, 242, 245, 282 

Food, Drug & Cosmetic Act (Cope- 
land Law), 202, 204, 206, 208-209, 
211-213, 245 

Foreign Agents Registration Act, 
358, 373 

Holding Company Act, 365 

Interference with Foreign Rela- 
tions, 373 

National Defense Statutes, 275 

Naturalization Law, 79 

Patent Laws, 184, 217, 223, 227 

Reciprocal Trade Agreement Act, 
199, 200 

Security Statutes, 285 

Statute of Limitations, 329 

Tariff Laws, 18, 151, 337 

Trading with the Enemy Act, 58, 
82, 96, 305, 360, 373 

U. S. Code Title 18, Section 88, 372 

U. S. Code Title 18, Section 235, 
352 

U. S. Code Title 18, Section 254, 
352 

War Regulations, 170 

Webb-Pomerene Export Trade Act, 

346 
United States Pharmacopoeia (U.S.P.), 

245 



United States Rubber Co., 50 
University of Cologne, 99, 137 
University of Heidelberg, 3, 137 
University of Michigan Medical 

School,' 181 -182 

University of Pennsylvania, 194 
Untermeyer, Samuel, 306 

Valerie-Marie, Princess (Arenberg), 30 
Valtin, Jan (Richard Krebs), see 

Krebs 

Vandenberg, A. N., 192 
Vansittart, Lord (Robert Gilbert), 384 
Vegex, Inc., 43 
Venezuela, 258 
Vereinigte Aluminium Werke of 

Bitterfeld, Germany, 330 
Vereinigte Stahlwerke, see German 

Steel Trust 
Verein zur Wahrung der Interressen 

der Chemischen Industrie Deutch- 

lands, 21 
Verne, Jules, 23 

"Vicar of Wakefield" (book), 157 
Vichy French Financial Collaborators, 

381 

Vick Chemical Co., 41, 133, 225 
Vienna, Austria, 54 
Viereck, George Sylvester, 292, 294, 

296-297, 302 
Vita Ray Co., 245 
Vitamin Food Co., 43 
Vogel, H., 81 
vom Rath, Ernst, 75 
vom Rath, Dr. Walther, 73, 75 
vom Rath, William H. (Wilhelm), 74- 

75. 276 
von Bernstorff, Ambassador, 16, 18, 

21, 24, 91-92, 153, 282, 383 
von Bock, General Fedor, 73 
von Hoeffer, Dr. O., 99 
von Knieriem, Dr. August, 322, 341, 

405 

von Kroop Company, Frank, 281 
von Mach, Dr. Edmund, 290 
von Meister, Dr. Wilhelm, 73 
von Meister, F. Wilhelm, 74 
von Neurath (Count Konstandn), 196 
von Papen, Franz, 196, 409 
von Ribbentrop, Joachim, 197 
von Salis, Dr. E., 99 
von Schnitzler, Georg, 63, 73-75, 254, 

407. 412 
von Schnitzler, Lilo (Mrs. Herbert 

Scholz), see Scholz 



438 



INDEX 



von Schrocder, General Kurt 

(Schroder), 366 
Voorhis, Jerry, 374, 402, 404 

Wallace, Henry A., 124, 128, 166, 206, 
226, 362, 380-381, 409 

Wallace, Mary O. (Mrs. Charles Brug- 
mann), see Brugmann 

Wall Street, 84, 107, 112, 137, 391 

Walker, Frank C., 163 

Walker, Dr. George, 215 

Walsh, David I., 100-101 

Walsh, James, 160-162 

Walsh, Thomas (J.), 157 

War, Peace & Change (book), 299 

Warburg, Paul M., 109, 146, 151 

Warsaw, Poland, 57 

Washington (D. C.), 31, 42, 44, 98, 
106, 111, 119-120, 123, 132-134, 138, 
140, 151, 156, 163, 165, 243, 354, 
366, 401, 403-404, 413 

Washington Correspondents, 176 

Washington Times Herald, 171 

Watkins Co., R. L., 244-245 

Weber, Orlando F., 36 

Weideman, Carl M., 195 

Weidemann, Fritz, 77, 291, 303 

Weimar Republic, 70, 102 

Weinberg, Dr. Karl, 102 

Weiss, Fred E., 99 

Weiss, Dr. William E. (Herr Wil- 
helm), 32, 38-41, 43-44, 49, 64, 97- 
100, 102-103, 105, 109, 125, 133, 159, 
170, 172, 174, 184, 203, 225, 229, 
243, 246, 253-256, 258, 261, 264, 309, 

372 

Weiss, William E., Jr., 43, 174, 243 

Welland Canal (Canada), 148 

Wellman, Mr., 118 

West, Charles, 169 

Wherry, Kenneth S., 387 

Wherry, William M., 336 

White, Thomas Earl, 7 

White, Wallace H., Jr., 221 

"Why Not Enforce the Laws We Al- 
ready Have" (book), 204 

Wiley, Dr. Harvey (W.), 202, 204, 282 

Wiley, Louis, 233-234 

Wilhelm, Kaiser, 17, 30, 33-34, 69, 72, 
142, 184, 215, 282, 289 

Willkie, Wendell, 287-288 



Williams & Crowell Color Co., 94 

Williamson, S. Hugh, 105, 123 

Wilmer, Col. Richard A., 386 

Wilson, Woodrow, 15, 146-147, 200, 
290, 294 

Winchell, Walter, 322 

Winant, John C., 384 

Windenger, A. T., 87, 363 

Winthrop Chemical Co., 28-29, 39-44, 
8 . 94, 97-9 8 i04-!05, 124, 130, 134, 
172, 174, 180, 203, 209-217, 219-228, 
248, 250, 256, 272, 307, 314, 334- 
335. 348, 356, S59-3 6 1 

Winthrop Research Laboratories, 97 

Wisconsin Alumni (Inc.) Research 
Foundation, 42-43, 335 

Wisconsin University, 42 

Wohlforth, Robert, 310-311 

Wojahn, Kurt, 78, 252 

Wojahn, Max, 78, 243, 252, 262 

Wolff, Dr. E., 178 

Wood, General Robert E., 301 

Wood, Lee B., 248 

Worch, J. Rudolph, 80 

World Peaceways, Inc., 298-299, 389 

World Society for Preservation of 
German Business, 13 

World War I, 2, 11-12, 15, 18, 21, 
23-24, 31. 33-34, 38, 40, 44. 50, 55^ 
58, 60-62, 64, 69, 71-72, 75, 80, 82, 
86, 89, 91, 93, 126, 135, 137, 142, 
148-149, 172, 178, 181, 184-185, 189- 

191, 200, 216-217, 259, 269, 271-275, 
277, 289-290, 292-298, 301-302, 314, 

346, 360-362, 368, 372, 378, 387, 393, 
397,411,413 

World War II, 31, 38, 46, 49, 53, 62, 
68, 70, 72, 77, 106, 118-119, 1 34- 
165, 185, 188-189, *95. 216-217, 270- 
273' 275, 278, 282-283, 286-287, 292- 
293. 296-298, 300, 302, 304, 306, 308, 
343' 347. 349. 362, 372, 380, 411-413 

World War III, 73, 408, 412 

Wyzanski, Judge Charles E., Jr., 341- 
343 

Yale University, 29 

Yalta Conference, 384, 391, 395, 408 

Ypres, 17 

Zapp, Manfred (Casanova), 272, 292