James Stewart Martin

That this book exists at all is a small miracle. When it was published in 1950, to one good review and one mixed, it disappeared from store shelves overnight. It wasn’t a hit; the CIA bought up every copy it could for destruction. That’s the workaround for a country that does not ban books per se.

It appears the single European market goes back at least to World War I. German businesses combined their companies and created cartels to control the manufacture and flow of goods. Just a hundred men controlled it all, sitting on multiple boards, heading up multiple companies in multiple countries. They could shuffle assets and hide ownership, often by appealing to central government that they were the national pride (“too big to fail” today). They hid mountains of secret contracts in mines, inns and back yards all over Germany, expecting to unearth them after the war and pick up where they left off.

Some of the subterfuge was not mutually agreed. German firms skirted the edges of patent laws, patenting huge numbers of products in such fraudulently vague terms that it was easy to fall prey to their lawsuits. The ensuing tangle was so unattractive that firms like DuPont settled, paying hefty sums and agreeing to unnatural schedules of payments that would avoid the war’s effects. DuPont thereby joined the circle and participated actively. In cartels, sharing patents across all companies was a fine reward for giving up marketing in others’ territories. So General Electric shared its formula for having light bulbs burn out prematurely, proudly claiming it would double the revenues of the cartel members within five years. The use of bearer shares allowed American trustees to nominally control giant German combines. Parking patents and whole companies during the war, to be reclaimed later, was commonplace. German companies bought American ones, in inverse mergers we are familiar with. Today it’s for tax shopping. Then it was so the American firm could rescue “its” German assets from the occupiers.

German business dictated to the Nazis, because it had the cash, the means of production and the international connections. The Nazis rewarded them with bennies like slaves. Krupp leveraged its 2000 employees with as many as 110,000 slaves, who they were encouraged to work to death. The firms contributed to a bank account as part of the deal, a massive affair that Himmler could draw down when he wanted more money. Hitler hid his booty in a Swiss account.

Martin was a Justice Department lawyer, sent by Vice President Truman to Germany even before the armistice, to determine the extent and connections of German business, and how they managed to make Germany a superpower out of the basket case it was after the Treaty of Versailles. The answer of course, was that the treaty so handcuffed business it had to develop workarounds and international connections to bypass restrictions. Martin didn’t know what he might find, and some of it is flabbergasting. Transatlantic shipping was plagued by constant sinkings, made so very much easier for the Germans by industry’s insistence on insurance and reinsurance. The biggest, most stable reinsurer was Munich Re, which received documents on every ship, its cargo, US departure port, arrival port, and departure date, which it automatically shared with German Intelligence.

The last chapters are a litany of reform failures, as a constant flow of American executives exercised influence over occupied Germany, Washington, and the US military command to prevent the dismemberment of cartels, the imposition of restrictions or controlling ownership of German industries. Lack of discipline, loyalty and infighting among army groups as well as completely ignoring directives from Washington made it easy for the executives, some of whom put on uniforms during the war and did it themselves. Wall Street’s Dillon Reed pops up a good dozen times. It all led to a near total failure to remake Germany, just as it failed after WWI. Big business won the peace as it had the war. All the idealistic lawyers sent to Germany quit, as German business successfully positioned itself as non-Nazi victims, according to US Senators. As Martin plainly put it: “We had been stopped in Germany by American business.”

Martin was a remarkably dispassionate writer. Despite all the setbacks and astounding discoveries he could not fix, he simply reported the facts. He never says incredibly or unfortunately or amazingly about any of it. There are no judgments, just failures we can see ourselves. The book ends with a plea to control what we now call globalization before it controls us. Oh well.

All Honorable Men is an imprint of Open Road, called Forbidden Bookshelf Ebooks. If this is typical of the impact, I’d love to read them all.

David Wineberg… (lisätietoja)