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In 1938, I carted my industrial white whale to the
Antitrust Division of the Department of Justice. There as head of
the Patent and Cartel Section, under the great Thurman Arnold, I
instituted the cartel program in which the attack against I.G.
Farben continued throughout the course of World War II. In 1943, I
co-authored Germany’s Master Plan, a book outlining the details of
this program. After the war, when I read the transcript of the trial
of the I.G. war criminals at Nuremberg, I knew that someday I would
write the present book.
Such was the judgment rendered by a team of civilian and military experts assigned by General Eisenhower at the close of World War II to make an exhaustive investigation of I.G.’s contribution to the Nazi war effort. Extravagant as this conclusion may have sounded, the record sustains its accuracy.
But I.G. was more than a corporate empire. Through the uncanny talents of its scientists and engineers, it secured the vital self-sufficiency that enabled Germany to maneuver in the world of power politics. From its laboratories and factories flowed the strategic raw materials that Germany’s own territory could not supply, the synthetics of oil, rubber, nitrates, and fibers. So, too, I.G. produced vaccines, sera, and drugs such as Salvarsan, aspirin, Atabrine, and Novocain, along with sulfa drugs, as well as poison gases and rocket fuels.
Few universities could match the profusion of Nobel Prizes earned by its scientists:
Gustav Stresemann, chancellor and foreign minister during the Weimar Republic, once said, “Without I.G. and coal, I can have no foreign policy.” But it was for the Nazis that I.G. performed the greatest service. With I.G. and coal Adolf Hitler almost conquered the world.
Before long it joined the Nazis in a vast forced labor program in which millions of victims from the conquered countries were enslaved in the service of German war production. But slavery was only a step in the dehumanization of victor and vanquished. I.G. found itself in the role of an industrial Faust, unable and unwilling to extricate itself from the compact it had made with Hitler to help prepare the Nazis for war.
The depth of the partnership was reached at Auschwitz, the extermination center, where four million human beings were destroyed in accordance with the “Final Solution of the Jewish Question,” Hitler’s plan to destroy an entire people. Drawn by the almost limitless reservoir of death camp labor, I.G. chose to build a great industrial complex at Auschwitz for the production of synthetic rubber and oil. So enormous was this installation that it used as much electricity as did the entire city of Berlin. More than 25,000 camp inmates paid with their lives to construct it.
They were the executives who made I.G. preeminent in the world of technology and commerce. They served on the boards of directors of the most prestigious corporations in their own country and abroad, where they were treated with awe and admiration. When their government called, they accepted official posts in the spirit of public service. Like their counterparts everywhere, they were among the leading supporters of culture, charity, and religion, donating their names, time, and money.
In 1856 an eighteen-year-old chemistry student at the Royal College in London, William Henry Perkin, while experimenting with coal tar in the search for synthetic quinine, found something a great deal more valuable. Instead of quinine, a bright purple solution filled Perkin’s test tube. And with the first of the aniline dyes, a new industry was born. Although Perkin’s remarkable discovery may have been an accident, he had the genius to perceive its immense potential.
After he applied for a patent, he opened a factory for commercial exploitation. But Perkin was destined to suffer the fate of prophets. His own countrymen did not fully appreciate either the seminal nature or the industrial potential of the discovery. The Germans, however, did recognize the great future of synthetic dyes. Scientist-businessmen from Germany settled in England long enough to learn the new technology and then carted it off bodily to their homeland.
What they did with their booty was nothing less than an industrial miracle. With the German knack for turning garbage into wealth, these talented borrowers transformed the mountains of coal tar, the costly waste of the steel production of the Ruhr, into an immensely valuable product, the raw material for a new and exciting dyestuff industry. By the turn of the twentieth century, six German companies had emerged to dominate the world’s production and distribution of synthetic dyestuffs. Both in Germany and abroad, these firms were recognized as the “Big Six.”
There were three very large enterprises:
Not far behind were three lesser concerns:
But the very success in gaining a worldwide monopoly led the German producers into a bitter and costly competition for a larger share of the lucrative foreign and domestic markets. Price cutting, protracted patent litigation, kickbacks to customers, and bribery to gain technical secrets—in fact, every known form of cutthroat competition—afflicted the industry. With the consequent loss of profits and reduction of growth, the leaders of the industry began casting about for a solution. It remained for Carl Duisberg, the general manager of Bayer and a dominant figure in the industry, to take the first step in bringing order out of chaos.
Politically, Duisberg was an ardent Pan-German who believed passionately in Germany’s mission in world affairs. Devoted to the “Fuehrer principle” in the organization of political and industrial life, he specifically used the term long before Hitler was ever heard of. At the same time, Duisberg was a superb opportunist, never permitting devotion to principle to interfere with expediency. Whether under the Kaiser, the Weimar Republic, or the Nazis, he always made the required adjustments, and he never failed to prosper.
Bayer and Hoechst developed highly profitable pharmaceutical divisions that were giants in the field, with worldwide systems of distribution. Hoechst, for example, supported the research of Paul Ehrlich that led to his discovery of Salvarsan, the cure for syphilis. The result was everlasting fame and a Nobel Prize for Ehrlich and a patent monopoly of an enormously profitable pharmaceutical product for Hoechst. Hoechst also developed Novocain, a painkiller that physicians and dentists came to rely on universally. These products gave the Hoechst trademark acceptance everywhere.
It was originally named Dolophine, in honor of Adolf Hitler. Today methadone is used principally in the treatment of heroin addiction. The sulfa drugs also had their inspiration in the test tubes of Bayer’s laboratories, as did Atabrine, the most effective malarial suppressant. Indeed, no hospital and no pharmacy can be found without some Bayer product.
The first colors to come out of this industry were reds and yellows, which were mastered quite early. But unlocking the secret of synthetic blues proved more troublesome. As a result, the world for a time was forced to rely on China, the age-old source for natural indigo dyes. Great rewards awaited the discoverer of an acceptable synthetic. And BASF’s part in this race has become a legend in the industry.
Heinrich von Brunck, the
chairman of the managing board of BASF and a dyestuff chemist of
extraordinary talent and imagination, convinced the BASF board of
directors to make the search for synthetic indigo a major effort.
Long before the project had run its course, Brunck had committed the
greater part of BASF’s capital to this undertaking.
Brunck was vindicated as the company’s profits began to soar. The project rang the death knell for the natural dyestuff industry, and BASF’s discovery and consequent success catapulted this company into leadership of the industry. Commercial boldness and technological excellence became the decisive elements in its corporate character. BASF’s willingness to make big corporate gambles further crystallized in another audacious project that followed the indigo success.
This time it was the search for a synthetic nitrate to free Germany from dependence on Chile, which monopolized the natural nitrate supply. For BASF this undertaking involved a scientific and business risk far exceeding that in the indigo gamble. Brunck, his confidence bolstered by the indigo breakthrough, made the decision to go all out.
Chile had a monopoly of the world’s supply of
natural nitrates, the most effective of all fertilizers, and as is
the custom of monopolists Chile charged what the traffic would bear.
But many concerned scientists, such as the renowned Sir William Crookes, expressed the fear that Chile’s natural reserves of
nitrates would soon be depleted. The grimness of the prospect of a
starving world underscored the opportunity for realizing great
financial profits should a synthetic nitrate be produced. There was another opportunity that also should have spurred the effort to break Chile’s monopoly. Nitrates were an essential ingredient of all explosives, including gunpowder. But for reasons not altogether clear—unless one is willing to accept the conventional wisdom that the military mind is incapable of seeing beyond the last war—the German General Staff did not appear to be concerned that Chile controlled the supply of a raw material so essential for waging war. And the military implications of Chile’s monopoly did not excite the interest of the private manufacturers of explosives in finding alternatives.
From a commercial point of view, it was cheaper for explosive manufacturers to import nitrates from Chile than to undertake the uncertain and expensive venture of inventing a synthetic substitute. In times of peace, gunpowder was no great source of profits.
But the BASF board of directors questioned the proposed financial investment in a technologically unknown terrain. To place this responsibility in the hands of an untested thirty-four-year-old was not exactly a prudent business decision. But Brunck was not to be denied.
He compared the venture with the earlier indigo gamble.
The directors capitulated and the decision was made to go ahead. The challenge Bosch faced was to design and to build an industrial-size installation that could contain the great pressures and high temperatures required in Haber’s process. Taming these wild forces called for the discovery of catalysts to speed up the reactions and for the invention of alloys to keep the outsize equipment intact. Bosch chose Oppau near BASF’s headquarters at Ludwigshafen as the site for the new plant.
Recognizing that Brunck’s health was failing and that support among board members was paper-thin, Bosch worked like a man with a mission. As the technological difficulties and the costs mounted, the board became more restive. Brunck’s death at the end of 1912 complicated Bosch’s problems. But in the fall of 1913 he reached his goal ahead of schedule. The Oppau plant, completed and operating, began mass-producing synthetic ammonia.
Bosch’s feat of technical macro-dynamics was recognized throughout the world as an engineering achievement of the first rank. Before long the scientific community elevated him to near equality with Haber by referring to the “Haber-Bosch process.” For an engineer this was an extraordinary accolade from the world of pure science. And twenty years later this achievement earned for Bosch a Nobel Prize, the first engineer so honored.
The closing of the Oppau plant, however, was by no means the result of blunder or the mindlessness of the German military establishment. Rather, it was the logical outcome of the basic war philosophy successfully followed by the General Staff in the 1871 victory over France and, ever since then, reworked and refined for the war that was now being waged with France, Britain, and Russia. Perfected by the late general Count Alfried von Schlieffen, chief of the General Staff from 1895 to 1906, this policy had become the bible of the German General Staff.
According to the Schlieffen plan, a long war for Germany could not even be considered in the formulation of military plans. He held that the political-industrial structure of modern states was so delicately balanced that they could not survive for long the disruptive power and violence of twentieth-century military technology.
The consequent social unrest in the rear would disastrously affect the fighting at the front. Schlieffen had no interest in the manufacturing capacity of the industrial community. All he wanted from the civilian population was civil order and no interference with military operations. The problem of raw materials was a long-term industrial concern and hence an irrelevant distraction from achieving a quick victory.
In a short war, industry could play no vital part; in a long war, it would be an impediment. Such was the inflexible blueprint Schlieffen bequeathed to the General Staff. What both he and they failed to understand was that industrial mobilization was the very element that made wars of exhaustion possible and that industrial supremacy was the key to victory. This oversight had fatal consequences.
Rathenau was no ordinary industrialist. He was the director of more than 100 large corporations in Germany and elsewhere in Europe and a recognized intellectual whose books were seriously received in university and diplomatic circles. No less important, Rathenau was also a political figure: seven years later he became Germany’s foreign minister. It is probable that the war minister was already suspicious of the euphoria exhibited by his military colleagues in charge of Germany’s war effort for despite the enormous press of other duties he took time to hear Rathenau out.
Aggravating the plight of a Germany at war was the dismal fact that nature had made it poor in raw materials. A broad range of strategic raw materials such as nitrates, oil, rubber, and many metals were available only from overseas sources. Without these basic imports, Germany’s war production would be precarious. Denied these raw materials for a prolonged period, a number of vital industries would grind to a halt.
Pressed by Rathenau the agency promptly undertook a survey of 900 concerns engaged in war production. The survey confirmed Rathenau’s worst fears. It disclosed that German industry had no more than a six months’ supply of imported raw materials. 2 The limited stockpile of nitrates made gunpowder production particularly vulnerable. As long as the British fleet controlled the seas, the prospect of replenishing the nitrate supply by shipments from Chile was slim.
Despite the fact that Rathenau was an eminent industrialist appointed by Falkenhayn himself, the traditional Prussian officers in the War Ministry resented him as a Jew and a civilian. In a direct answer to his warning that the nitrate shortage would soon adversely affect the German War strategy, they responded with a curt note instructing Rathenau not to interfere in purely military affairs. 3 But arrogance precedes disaster and the day of reckoning was not far off. In the historic Battle of the Marne during the second week of September 1914, with Paris almost in sight, the German army’s headlong rush to victory was stopped cold by an unexpected French counterattack, shattering the Wehrmacht’s design for a quick victory.
The Schlieffen plan lay in ruins, buried in the trenches the opposing sides were forced to dig. Confronted by the dreaded long war of exhaustion, the military bureaucracy could no longer ignore Rathenau. The violence of the battle had used up more of the gunpowder than anticipated. Suddenly the dullest officers in the War Ministry understood the terrible meaning of the British blockade.
Though conversion in the laboratory was a well-known process, adapting it to large-scale factory production called for a monumental effort. Among other things, such an undertaking meant the immediate return of the skilled Oppau personnel who had been drafted and a guarantee that building materials, technical equipment, and heavy machinery already in short supply would be readily available. Not unmindful of the interests of BASF’s stockholders, Bosch demanded a substantial subsidy. Prodded by Rathenau and Haber, the War Ministry agreed to all of Bosch’s demands.
Confronted with the specter of an army without gunpowder, the War Ministry frantically scoured Germany and the conquered territories for nitrates. Even tiny amounts of fertilizer were commandeered from peasants. 5 The shortage was temporarily eased in early October when a cache of 100,000 tons of Chilean saltpeter was discovered in cargo ships in the harbor of occupied Antwerp. 6
However, as Fritz Haber later reminisced,
The nitrate shortage began to affect seriously the strategy of fighting the war itself. Unfortunately, having relied so completely on Schlieffen, Germany’s military leaders were now in no mood to gamble everything on Bosch’s success. Prudence dictated that alternatives be explored without delay. Being military men, Germany’s military leaders sought a military solution. Accordingly, they called for a plan to blast a hole in the British blockade and reopen the supply line from Chile to the German gunpowder plants.
So little did the Admiralty appreciate the critical nature of Spee’s mission that it refused the British commander’s urgent appeal for reinforcements. This failure was soon to be regretted. On November 1, the enemy squadrons met at Coronel, off the coast of Chile. Outgunned and outmaneuvered, the British were swiftly defeated. Those ships not sunk fled through the Straits of Magellan to their base in the Falkland Islands.
As the German flotilla approached, observers on the cliffs of the Falklands observed heavily armed landing parties preparing to invade. Before the invasion could begin, however, the reinforced British flotilla reached the battle scene. This time the superiority of the British naval forces was overwhelming. With one exception every German warship, as well as Spee himself, was sent to the bottom. Not a single British ship was lost.
Apparently unaware of Germany’s crucial nitrate shortage, Churchill was able to say of Spee’s mission only that,
In any event, for Germany the life and death Battle of Nitrogen extended beyond the naval engagement off the southern tip of South America. The next phase was centered in the Oppau laboratories, where work continued around the clock. Bosch was Germany’s last hope.
Though all poisonous weapons had been outlawed by the 1907 Hague convention, to which Germany was a signatory, the attractions of poison gas warfare were too great for the Germans to be constrained by the treaty. To the contrary, the very fact that poison gas was barred by the convention assured Germany of the advantage of surprise. Bauer and Nernst paid a visit to the acknowledged spokesman of the German dyestuff industry, Carl Duisberg, who saw immediately that poison gas warfare could revive the moribund dyestuff industry, which was almost at a standstill since the beginning of the war. As a German patriot Duisberg also recognized the possible decisiveness of the new weapon.
Accordingly, he not only committed Bayer to the poison gas project but also involved himself personally in the experiments. In a letter to Bauer in early 1915, Duisberg wrote of his firsthand knowledge of the effects of phosgene:
The first gas to be used by the German army, a bromide, came out of the Bayer laboratory. Its secret code name was “T-Stoff.” The army decided to use it against Russian troops at the end of January. But the new weapon was a dismal failure. The Russian winter was so cold that the gas froze and sank into the snow. 12
Fritz Haber, whose bureau in the War Raw Materials Office was deeply involved in the poison gas project, regarded chlorine as a more effective weapon and the spring as a more advantageous time for its introduction. Chlorine was in plentiful supply in the dyestuff plants. Moreover, Haber knew of BASF’s successful attempt to store chlorine in metal cylinders rather than the traditional glass containers, an obvious advantage on the battlefield. Haber’s staff at the Kaiser Wilhelm Institute, in cooperation with the I.G. companies, began preparing chlorine for the coming test on the field of battle.
This project was one of the most closely held military
secrets in all Germany. An explosion in the laboratories of the
Institute, which killed Haber’s assistant, who was experimenting
with phosgene, almost gave the secret venture away. Quick and
successful suppression of news of the event prevented any serious
leakage. Chlorine gas was scheduled to be tested on the western
front in April 1915. Haber, who was certain that the attack would
devastate the enemy, advised his superiors to assign large reserves
of troops to exploit the opportunity. However, the military refused
to regard the projected attack as anything more than a test and
allocated only one company of soldiers to support it.
The report of British Field Marshal Sir J. D. P. French tells what happened.
Following a heavy bombardment, the enemy attacked the French Division at about 5 p.m., using asphyxiating gases for the first time. Aircraft reported that at about 5 p.m., thick yellow smoke had been seen issuing from the German trenches between Langemarck and Bixschoote. What follows almost defies description.
The effect of these poisonous gases was so virulent as to render the whole of the line held by the French Division mentioned above practically incapable of any action at all. It was at first impossible for anyone to realize what had actually happened. The smoke and fumes hid everything from sight, and hundreds of men were thrown into a comatose or dying condition, and within an hour the whole position had to be abandoned, together with about fifty guns. 14
The effect of the chlorine gas at Ypres was truly devastating. Before the day was over, 15,000 soldiers lay on the battlefield, one-third of them dead. 15
An enormous gap, over four miles wide, had been torn in the Allied lines. Nothing stood between the Germans and the vulnerable French ports, just across the channel from England. But the failure of the German army to anticipate the overwhelming effect of its new weapon saved the Allies from annihilation. Haber was extremely bitter about this. As he wrote later, the military officials involved,
After the attack at Ypres, Haber began to prepare for a gas attack on the eastern front. Haber’s wife, Clara, pleaded with him to abandon the project and stay at home. He refused, insisting that it was his duty as a patriot to do what he could to help Germany.
There was no need to create a clumsy and complicated organization with an efficient one existing in [the German dyestuff companies] ready to meet Government demands. 19
Since producing a poison gas involves several stages of production, each stage was assigned to the company most suited to carry it out. The direct involvement of the military was very apparent. Masses of uniformed soldiers were constantly arriving at the various plants, where schools were established to train them in gas warfare. The total result was the emergence of a highly successful industrial, scientific, and military cooperative.
He had succeeded. Oppau was ready to mass produce synthetic nitrate. Never again would the Wehrmacht’s cannon be hostage to the nitrate beds of Chile. Throughout Germany Bosch was hailed as a hero. For Germany Bosch’s success meant salvation; for BASF it was a technological and financial bonanza. Bosch immediately began to press the Government to support an enormous expansion of BASF’s synthetic nitrate capacity.
He had the unexpected but welcome assistance of a young lieutenant in the War Raw Materials Office with the imposing title of Plenipotentiary for Chemical Production, Hermann Schmitz. With Schmitz’s help, Bosch persuaded the German government to build a huge Haber-Bosch high-pressure plant in Leuna, in Central Germany.
The financial rewards for BASF were enough to justify a twenty-five percent return on invested capital to its stockholders during the rest of the war.
Germany’s introduction of
poison gas shook the military foundations of the Allied powers. The
German monopoly of dyestuff production had given it an incalculable
military advantage. In the new technology of chemical warfare, any
country without a dyestuff industry was vulnerable to its enemies.
It was an intolerable situation and each of the Allied countries
frantically undertook programs to close the gap.
Poucher’s defection brought an angry response from Carl Bosch, enraged by what he regarded as a breach of business ethics by Du Pont and a treasonable act by Poucher—that Poucher was an American-born citizen made no difference to Bosch. As further encouragement to American producers like Du Pont to enter the new field, a protective tariff was enacted in the summer of 1916. Carl Duisberg observed the growing competition from abroad brought on by military necessity with mounting concern for the commercial future.
He suggested that the German dyestuff companies pool their resources into a single interessen gemeinschaft in order to strengthen their position in the postwar world against the new competition. 22 Such an arrangement would provide for the pooling of profits and patents. It would also lead to close cooperation among the various concerns without surrender of the independence or identity by individual members. In effect such a community of interests would formalize the cooperation brought about by the gas warfare effort. At first Duisberg’s proposal met with a lack of interest by some of the companies. Very soon, however, the opposition evaporated in the wake of an unexpected event on the battlefield not unlike the surprise at the Marne.
The postwar implications of this unthinkable thought were obvious. In mid-August the major German dyestuff companies led by the so-called Big Three, BASF, Bayer, and Hoescht, and joined by five others, Kalle, Cassella, Agfa, Ter Meer, and Greisham, accepted Duisberg’s proposal and formed the Interessen Gemeinschaft der Deutschen Teerfarbenindustrie (the “Community of Interest of the German Dyestuff Industry”). This structure came to be known simply as I.G. and the individual members as the I.G. companies. (Years later the name I.G. was actually reserved in a court decision for the exclusive use of I.G. Farben.)
On September 9 Bauer conferred a great honor on Duisberg and Krupp. He arranged for them to meet with Hindenburg and Ludendorff on the train of the Supreme Command to talk over the new munitions program. The two industrialists grasped the opportunity to complain about the critical shortage of labor. The goals of the Hindenburg program could not be fulfilled, they said, unless this problem were solved. Apparently, Duisberg was reassured by Hindenburg’s response. The next day he wrote a rhapsodic note of thanks to Bauer.
Max Bauer, who represented the Supreme Command at the meeting, made it clear in his opening address that the industrialists’ demands would be heeded:
Duisberg again complained about the labor shortage afflicting German industry. Wages were escalating and war production was dropping to dangerously low levels. He proposed that the Supreme Command “open up the Belgian labor basin.” He was aware that an earlier attempt to recruit Belgians to work in German factories had failed because the Belgians refused to help their conquerors. Bauer nevertheless assured Duisberg that his proposal would be put into effect. 26 And less than two months later, in November 1916, the German army began the forced deportation of Belgian workers to German factories. This decision and , its consequent brutality was a shock to the Belgian nation.
The Germans dismissed the American complaint. The German governor general of Belgium argued that the evacuation of Belgian laborers was not a hardship but a blessing. The German press pursued this theme: the Koelner Volkszeitung insisted that the deportation of Belgian workers was prompted by “true humanitarianism, protecting thousands of able-bodied workmen from going to ruin by remaining unemployed.” 29
By the middle of November 1916, German authorities had “captured” 40,000 men and sent them to German factories and mines; 2000 more were being added each day. Raiding parties searched homes, theaters, and markets. Ultimately, over 66,000 Belgians were transported to Germany.
During the fall of 1916, Duisberg continued his activities on behalf of the I.G. companies on other “battlefronts” at home. Inflation, the economic disease that feasts on war, reached so high a level that it began to threaten war production.
By early 1917 inflation was rapidly approaching crisis proportions. Labor unrest mounted, accompanied by “exorbitant” wage demands and followed by a series of strikes. To halt the inflation Duisberg, as spokesman for the industrialists, demanded a ceiling on wages and a prohibition on labor’s right to strike. At the same time he took the lead in the industrialists’ resistance to any attempt by the government to control profits or prices. The inflation rolled on.
He then went on to cite some invidious examples of the conduct of some businessmen:
It was suspected that Groener had adopted this viewpoint because of the influence of one of his aides, Captain Richard Merton, a Jew and a political moderate. However, Merton was no reckless radical or academic reformer. In private life he headed the Metallgesellschaft empire, the leading enterprise in the nonferrous metals industry of Germany and the largest metals trader in the world with branches and subsidiaries in every major country.
In this memorandum Merton pointed out that the growing power of the workers and the shortsightedness of the industrialists engaged in war production interacted to inflate prices. Cost-plus contracts with the price determined after delivery encouraged producers to pile on expenses rather than resist higher prices for raw materials and higher wages. The state, which was the final purchaser, “can do nothing else under the present circumstances than agree to the price which is demanded of it.”
Certain to offend the industrial community was Merton’s assertion that profits were already so great that wages could be raised without a corresponding increase in prices. Merton compounded his heresy by three recommendations. Prices should be fixed at the time war contracts were made, not after the goods were delivered. War profits should be taxed at a much higher rate. And finally, the chancellor should be empowered to take over the factories of recalcitrant owners or to intervene in the event that a labor dispute reached an impasse.
The opening lines of the invitation sounded the alarm:
Duisberg guaranteed the support and presence of the industrialists’ ally Max Bauer, who would appear as a representative of the Supreme Command. 34
Groener later charged that Duisberg and Bauer had conspired to secure his removal. Duisberg insistently denied any part in it. However, historian Gerald Feldman, who studied the available documents, came to the conclusion that “In the light of the evidence... it is virtually impossible not to conclude that Duisberg was a liar.” 35
Groener formally requested that Merton continue on his staff, but Ludendorff vetoed the application with the remark, “This marriage must be ended.” 36
Instead, Merton was scheduled for transfer to a dangerous battle area on the western front. Unlike Groener, the young industrialist was wise to the ways of Duisberg and Bauer. He had established his own avenues of intelligence and influence. Major Kurt von Schleicher, a friend (who fifteen years later would precede Hitler as Chancellor of Germany) had earlier warned Merton of Greener’s impending removal. Schleicher also arranged a safer post than the one planned for Merton. As a result of Schleicher’s intervention, Merton was issued orders “to investigate industrial bribery in the occupied areas.”
As a consequence Germany was forced to divert troops from the western front to mount an attack on Rumania in an attempt to gain control of the oil fields. Although the Germans quickly defeated the Rumanians, by the time they reached the oil, the Allied forces had succeeded in blowing up the wells and refineries. Without Rumanian oil, Germany’s fuel supply fell to a dangerously low level. A number of attempts were undertaken to find a substitute for natural oil.
One of the most promising was synthetic gasoline, produced from coal and hydrogen under high pressure by a process known as hydrogenation, not unlike the Haber-Bosch process. In fact, it had been invented in 1909 by Friedrich Bergius, who had his first experience in high-pressure chemistry as Fritz Haber’s assistant during the search for synthetic ammonia. In the laboratory the Bergius process showed great promise, and in 1916 Bergius set about to adapt his hydrogenation process to large-scale production. However, he had still not succeeded by the end of the war. What he lacked was an engineering genius, someone like Bosch to adapt his laboratory process to large-scale factory production.
Bosch, who since the nitrate crisis had concerned himself with synthetic solutions to Germany’s raw material weaknesses, was troubled by Nernst’s visit. He was now convinced that the entrance of the United States into the war would end any major oil problem for the Allies. For Germany no solution appeared to be in sight. Bosch lapsed into a deep depression, an affliction that periodically returned to him in the wake of disappointments and crises. The British blockade ultimately proved the decisive element in ending the war.
A raw materials famine, complicated by actual hunger, finally cracked the German will to resist. By the middle of August 1918, the German commanders knew that continuation of the war was futile and defeat only weeks off. Ludendorff asked Carl Duisberg and other industrialists to carry this message to the Kaiser, but they all refused. Duisberg was in fact preparing to adjust to the coming shape of things. 38 The German surrender was signaled by the signing of an armistice on November 11, 1918.
With barely any delay, the German authorities began preparations for the conference that would ultimately lead to the conclusion of a formal treaty of peace. Johann von Bernstorff, who as ambassador to the United States had developed a friendship with President Wilson, was chosen to direct this project. Not long afterward, Duisberg was asked to join these preliminary efforts as the representative of the chemical industry.
But Duisberg, unsure that his conversion to democracy would be accepted by the Allied conquerors or by the revolutionary German workers, decided that he would be unavailable and recommended the appointment of Bosch instead. 39 Bosch accepted. His mission was to save the I.G. companies. Germany may have lost the war, but the I.G. companies did not intend to lose the peace.
At the same time, Fritz Haber, who took the brunt of the scientific world’s condemnation of gas warfare, disguised himself with a beard and, like Duisberg, took off for Switzerland. The fears of men like Duisberg and Haber were not entirely groundless. Within weeks after the armistice, Allied troops poured into the Rhineland. No sooner had the occupying forces settled down than the infant chemical warfare services of the Allied armies began to press for the disclosure of the secret processes and production methods in use at the various I.G. plants turning out poison gases, explosives, dyestuffs, and nitrates.
The I.G. companies resisted on the ground that such disclosure would adversely affect their commercial position in the postwar world. Unlike the French, the Americans and the British were careful not unduly to upset the I.G. officials. Assurances were given that the investigators would not “pry into secrets of commercial value in times of peace.” No technology would have to be revealed nor questions answered unless they concerned weapons or military applications.
In keeping with this decision, the Allied peace commission directed the investigators to limit their inquiries to war products only. The Allied investigators promptly sent out an order to the I.G. companies requiring them to provide complete details on the manufacture of poison gases, gas masks, gunpowder, and other clearly military items. Failure to comply could result in the shutting down and even the dismantling of the noncompliant plants.
Whatever advantages the Germans had came from their domination of the peacetime dyestuff industry and not from the invention of new poisons.
Its members, including Bosch, were placed in protective custody behind barbed wire fencing surrounding the Hôtel des Réservoirs. Bosch, present as an expert in his field, was sent to the peace conference to protect the interests of the I.G. companies. The most stringent Allied demand as far as the I.G. companies were concerned was voiced by the French, who advocated the destruction of all of Germany’s armament facilities, which, they insisted, included the dyestuff and nitrate plants.
Marshal Foch had already made it clear that this issue was not negotiable. The only argument with any force that Bosch was able to muster against this demand was that the Allies needed a strong Germany as a bulwark against Russian communism.
To counter the American demand, Bosch marshaled the arguments against it in a position paper for the use of the German delegation:
Bosch argued that morality and international law required that all confiscated properties and patents be returned to their German owners. But Bosch was not content with mere repatriation. He insisted that the life of each patent seized should be extended to make up for the period of the confiscation. In another position paper Bosch took issue with the possible Allied demand for separation of the east and west banks of the Rhine. 45
This would have played havoc with the I.G. companies, especially BASF, whose plants were situated on the west bank. The French were particularly active in pushing for a takeover of the left bank or at least the establishment of an “independent” Rhineland republic. The annexation of Alsace-Lorraine by the Germans in 1871 was a precedent that led the Germans to fear the worst.
He was speaking for himself, for the dyestuff industry, and for Germany.
Those I.G. executives and scientists involved with poison gas could not have read these clauses without a sinking feeling. To the Allies, I.G. and poison gas were synonymous. Even so, a war crimes trial with such eminent scientists and industrialists in the dock seemed unthinkable.
Whatever remedy remained, it was unlikely that it could be achieved at Versailles. Also a matter of some concern to the I.G. companies was the inclusion of dye-stuffs in the reparations payments to the Allies for war damages. 49
It was a requirement that could have unfortunate political consequences—and it did. The anxieties about the Rhineland were not realized. The essential clause involving this sensitive issue required only demilitarization not annexation. 50
The west bank would remain German.
The military leaders of France and England, including Field Marshal Foch and Field Marshal Sir Henry Wilson, left no doubt that this provision meant the smashing of the I.G. plants that made poison gas and nitrates. Unless modified these terms spelled doom for the German chemical industry. On May 29, 1919, the German delegation submitted its formal memorandum of counterproposals to the president of the peace conference. In it the delegates complained that “the time limit given us for the drawing up of this memorandum was so short that it was impossible to exhaust all questions.”
They repeated their request for a personal confrontation and oral negotiations:
The German plea for some kind of personal negotiation was ignored. On June 16 the final terms of the Allies were presented to the German delegation. So few alterations had been made in the proposed terms already submitted that the same document was used and the changes were added by hand in red ink.
After one difficult session, Bosch told his friend Baron von Lersner, the new chief of the German delegation:
But with the confidence of a man in possession of a powerful secret, he added, “Trust me—the German chemical industry will never be destroyed.” The unusual display of confidence, Bosch indicated, without being specific, stemmed from a “special trump card” that he had been planning to play at the right moment. 53 That time had now arrived.
In some mysterious way never disclosed, Bosch made arrangements for a clandestine meeting with Frossard. At their secret rendezvous Bosch revealed his plan to temper the French demand for the demolition of the I.G. plants. In its essence, the plan provided for the French government and the I.G. companies to become partners in exploiting the French dyestuff market.
The German companies would surrender their jealously guarded secret know-how, without which the French, as Frossard knew, were already having trouble operating the confiscated dyestuff plants. It was an offer only desperation could force Bosch to make. In return, the I.G. companies would regain a half interest in their prewar dyestuff plants—and of overriding importance, the I.G. plants in Germany would be spared. As Bosch fully expected, Frossard agreed to his plan.
Such was the extent of the French objection. They did not pursue the affair any further.
The two men exchanged bitter words. Patard insisted that the Oppau and Leuna plants had to be destroyed because of their military value. Bosch countered that with famine facing many of the war devastated areas, these plants were desperately needed to produce fertilizer. Bosch finally began to impress Patard with the depth of his intellect. The general relaxed his hard position. If the synthetic nitrogen plants were so vital to agriculture, Patard said, France should have them as well as Germany.
Therefore, if Bosch would support a French nitrogen project, Patard would permit Oppau and Leuna to continue to operate. Patard was specific in his terms. BASF should help the French government build the nitrate plants, deliver the necessary equipment, make available all secrets, know-how, and technology, send experienced personnel to train French technicians, and expend their best efforts to create a successful French nitrogen industry. In return, the French would drop their demand that the German dyestuff and nitrate plants he destroyed. 57 Bosch was aware of the criticism he would face in Germany for giving up the Haber-Bosch monopoly, but he readily agreed to Patard’s terms.
A more important consideration was involved: it was the only way to save his beloved Oppau and Leuna and possibly I.G. itself. At the conclusion of this meeting it was agreed to start negotiations in November on a formal agreement. Before Bosch left Versailles, he had one more mission to accomplish. Hermann Schmitz, the bright young man in the War Raw Materials Office who had helped him secure the approval of the German Government for the building of the Leuna high-pressure chemical plant in the spring of 1915, was present at Versailles as a nitrate and fertilizer expert representing the Ministry of Economics. 58
Bosch arranged for Schmitz to join BASF as its chief of finance and foreign operations. In the flush of the excitement of this important step upward in the industrial world, Schmitz could not possibly imagine what the future held.
The comment of the foremost British scientific journal, Nature, was typical:
French scientists were especially resentful of the Nobel committee selection, and two French winners announced publicly that they would refuse to accept their prizes as long as Haber was to be honored with them. 61 Supporting the French scientists, the New York Times editorialized on January 27, 1920:
The Swedish government, troubled by the extent of the protest, sought to correct the impression that Haber was being honored for contributions to the horrors of war. Upon orders from Sweden, Dag Hammarskjöld, first secretary of the Swedish legation in Washington, wrote a letter to the New York Times pointing out that the report on which the award was made stated that the Haber method of producing ammonia is cheaper than any other so far known, that the production of cheap nitric fertilizers is of a universal importance to the increase of food production, and that consequently the Haber invention was of the greatest value to the world at large.... Ammonia, the product of the Haber method, must be converted into nitric acid in order to give rise to explosives or corrosive gases.
As a matter of fact, the Haber plants in Germany were erected with a view of producing agricultural fertilizers. 63 A few days later Haber’s role in Germany’s poison gas warfare became an official matter. The Versailles treaty, in one of its most bitterly contested provisions, had called for a war crimes trial before a special tribunal of “persons accused of having committed acts in violation of the laws and customs of war.” 64
On February 3, 1920, a list of over 900 alleged war criminals was submitted by the Allies to Baron von Lersner as head of the German peace delegation. On the list were military and political figures, including the Kaiser, Hindenburg, Ludendorff, Bernstorff, and princes of the Royal House of Hohenzollern. Fritz Haber was also on the list—the only person remotely within the I.G. orbit to be charged as a war criminal.
The number of those
accused of war crimes had been reduced from 900 to 45; the list was
now composed mostly of obscure figures like submarine commanders and
prison guards. Haber’s name was no longer on the list. The German
government agreed to commence proceedings against the accused in a
German court at Leipzig. The trials took place late in May 1921. Of
the six defendants accused by the British, five were convicted and
given short sentences; of the six on the Belgian and French lists,
only one, accused of shooting a prisoner of war, was convicted and
sentenced to two years.
A New York Times editorial speculated:
An American reporter asked Haber for a possible explanation of the explosion. He replied that the Oppau explosion could not possibly have been caused in the production of synthetic nitrates by the Haber-Bosch process; neither the nitrates nor the enormous pressures involved could lead to an explosion of such force. Haber added intriguingly that “an investigation may reveal new and terrible forces.” 66
Whatever the cause, it was certain that BASF faced an enormous financial loss if the Oppau plant were not reconstructed quickly. However, BASF engineers estimated that the rebuilding would require at least a year. Bosch put Carl Krauch, whom he regarded as his most gifted protégé, in charge of Oppau’s reconstruction, with orders to spare no expense. 67 The most urgent problem was the recruitment of a huge labor force. At least 10,000 construction workers, mainly skilled craftsmen, were needed, as well as supervisory personnel. It seemed an impossible requirement.
However, Krauch attacked the problem with imagination and boldness. He contracted with corporations all over Germany to suspend their own production and send complete units of workers and their supervisors to work at Oppau. Though expensive, the method proved a spectacular success. 68 Krauch was able to assemble the required work force in an incredibly short time, and Oppau was restored in only three months.
The day after Oppau resumed
operation, Bosch rewarded Krauch by appointing him to the BASF
managing board of directors. 69 The triumvirate who were to guide
I.G. during the crucial years to come—Bosch, Schmitz, and
Krauch—were now at the top of BASF, ready to play out their roles.
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