WALL STREET AND THE RISE OF HITLERBy Antony C. Suttonwww.reformed-theology.org/html/books/wall_street/
[...]The Myth of "Sidney Warburg"
Who Was "Sidney Warburg"?
The question posed in this chapter is the accusation that some Wall Street financiers (the Rockefellers and Warburgs specifically have been accused) directly planned and financed Hitler's takeover in 1933, and that they did this from Wall Street. On this question the so-called myth of "Sidney Warburg" is relevant. Prominent Nazi Franz von Papen has stated in his Memoirs ... the most documented account of the National Socialists' sudden acquisition of funds was contained in a book published in Holland in 1933, by the old established Amsterdam publishing house of Van Holkema & Warendorf, called De Geldbronnen van Het Nationaal-Socialisme (Drie Gesprekken Met Hitler) under the name "Sidney Warburg."
A book with this title in Dutch by "Sidney Warburg" was indeed published in 1933, but remained on the book stalls in Holland only for a matter of days. The book was purged. One of three surviving original copies was translated into English. The translation was at one time deposited in the British Museum, but is now withdrawn from public circulation and is unavailable for research
. Nothing is now known of the original Dutch copy upon which this English translation was based.The second Dutch copy was owned by Chancellor Schussnigg in Austria, and nothing is known of its present whereabouts
. The third Dutch copy found its way to Switzerland and was translated into German. The German translation has survived down to the present day in the Schweizerischen Sozialarchiv in Zurich, Switzerland. A certified copy of the authenticated German translation of this Swiss survivor was purchased by the author in 1971 and translated into English. It is upon this English translation of the German translation that the text in this chapter is based.
Publication of the "Sidney Warburg" book was duly reported in the New York Times (November 24, 1933) under the title "Hoax on Nazis Feared." A brief article noted that a "Sidney Warburg" pamphlet has appeared in Holland, and the author is not the son of Felix Warburg. The translator is J. G. Shoup, a Belgian newspaperman living in Holland. The publishers and Shoup "are wondering if they have not been the victims of a hoax." The Times account adds:
The pamphlet repeats an old story to the effect that leading Americans, including John D. Rockefeller, financed Hitler from 1929 to 1932 to the extent of $32,000,000, their motive being"to liberate Germany from the financial grip of France by bringing about a revolution·" Many readers of the pamphlet have pointed out that it contains many inaccuracies.
Why was the Dutch original withdrawn from circulation in 1933? Because "Sidney Warburg" did not exist and a "Sidney Warburg" was claimed as the author. Since 1933 the "Sidney Warburg" book has been promoted by various parties both as a forgery and as a genuine document. The Warburg family itself has gone to some pains to substantiate its falsity.
What does the book report? What does the book claim happened in Germany in the early 1930s? And do these events have any resemblance to facts we know to be true from other evidence?
From the viewpoint of research methodology it is much more preferable to assume that the "Sidney Warburg" book is a forgery, unless we can prove the contrary. This is the procedure we shall adopt. The reader may well ask — then why bother to look closely at a possible forgery? There are at least two good reasons, apart from academic curiosity.
First, the Warburg claim that the book is a forgery has a curious and vital flaw. The Warburgs deny as false a book they admit not to have read t nor even seen. The Warburg denial is limited specifically to non-authorship by a Warburg. This denial is acceptable; but it does not deny or reject the validity of the contents. The denial merely repudiates authorship.
Second, we have already identified I.G. Farben as a key financier and backer of Hitler. We have provided photographic evidence (page 64) of the bank transfer slip for 400,000 marks from I.G. Farben to Hitler's "Nationale Treuhand" political slush fund account administered by Rudolf Hess. Now it is probable, almost certain, that "Sidney Warburg" did not exist. On the other hand, it is a matter of public record that the Warburgs were closely connected with I.G. Farben in Germany and the United States. In Germany Max Warburg was a director of I.G. Farben and in the United States brother Paul Warburg (father of James Paul Warburg) was a director of American I.G. Farben. In brief, we have incontrovertible evidence that some Warburgs, including the father of James Paul, the denouncer of the "Sidney Warburg" book, were directors of I.G. Farben. And I.G. Farben is known to have financed Hitler. "Sidney Warburg" was a myth, but I.G. Farben directors Max Warburg and Paul Warburg were not myths. This is reason enough to push further.
Let us first summarize the book which James Paul Warburg claims is a forgery.A Synopsis of the Suppressed "Sidney Warburg" Book
The Financial Sources of National Socialism opens with an alleged conversation between "Sidney Warburg" and joint author/translator I. G. Shoup. "Warburg" relates why he was handing Shoup an English language manuscript for translation into Dutch and publication in Holland In the words of the mythical "Sidney Warburg": There are moments when I want to turn away from a world of such intrigue, trickery, swindling and tampering with the stock exchange .... Do you know what I can never under stand? How it is possible that people of good and honest character — for which I have ample proof — participate in swindling and fraud, knowing full well that it will affect thousands.
Shoup then describes "Sidney Warburg" as "son of one of the largest bankers in the United States, member of the banking firm Kuhn, Loeb & Co., New York." "Sidney Warburg" then tells Shoup that he ("Warburg") wants to record for history how national socialism was financed by New York financiers.
The first section of the book is entitled simply "1929." It relates that in 1929 Wall Street had enormous credits outstanding in Germany and Austria, and that these claims had, for the most part, been frozen. While France was economically weak and feared Germany, France was also getting the "lion's share" of reparations funds which were actually financed from the United States. In June 1929, a meeting took place between the members of the Federal Reserve Bank and leading American bankers to decide what to do about France, and particularly to cheek her call on German reparations. This meeting was attended (according to the "Warburg" book) by the directors of Guaranty Trust Company, the "Presidents" of the Federal Reserve Banks, in addition to five independent bankers, "young Rockefeller," and Glean from Royal Dutch Shell. Carter and Rockefeller according to the text "dominated the proceedings. The others listened and nodded their heads."
The general consensus at the bankers' meeting was that the only way to free Germany from French financial clutches was by revolution, either Communist or German Nationalist. At an earlier meeting it had previously been agreed to contact Hitler to "try to find out if he were amenable to American financial support." Now Rockefeller reportedly had more recently seen a German-American leaflet about the Hitler national socialist movement and the purpose of this second meeting was to determine if "Sidney Warburg" was prepared to go to Germany as a courier to make personal contact with Hitler.
In return for proferred financial support, Hitler would be expected to conduct an "aggressive foreign policy and stir up the idea of revenge against France." This policy, it was anticipated, would result in a French appeal to the United States and England for assistance in "international questions involving the eventual German aggression." Hitler was not to know about the purpose of Wall Street's assistance. It would be left "to his reason and resourcefulness to discover the motives behind the proposal." "Warburg" accepted the proposed mission and left New York for Cherbourg on the Ile de France, "with a diplomatic passport and letters of recommendation from Carter, Tommy Walker, Rockefeller, Glean and Herbert Hoover."
Apparently, "Sidney Warburg" had some difficulty in meeting Hitler. The American Consul in Munich did not succeed in making contact with the Nazis, and finally Warburg went directly to Mayor Deutzberg of Munich, "with a recommendation from the American Consul," and a plea to guide Warburg to Hitler. Shoup then presents extracts from Hitler's statements at this initial meeting. These extracts include the usual Hitlerian anti-Semitic rantings, and it should be noted that all the anti, Semitic parts in the "Sidney Warburg" book are spoken by Hitler. (This is important because James Paul Warburg claims the Shoup book is totally anti-Semitic.) Funding of the Nazis was discussed at this meeting and Hitler is reported to insist that funds could not be deposited in a German bank but only in a foreign bank at his disposal. Hitler asked for 100 million marks and suggested that "Sidney Warburg" report on the Wall Street reaction through von Heydt at Lutzowufer, 18 Berlin.5
After reporting back to Wall Street, Warburg learned that $24 million was too much for the American bankers; they offered $10 million. Warburg contacted von Heydt and a further meeting was arranged, this time with an "undistinguished looking man, introduced to me under the name Frey." Instructions were given to make $10 million available at the Mendelsohn & Co. Bank in Amsterdam, Holland. Warburg was to ask the Mendelsohn Bank to make out checks in marks payable to named Nazis in ten German cities. Subsequently, Warburg travelled to Amsterdam, completed his mission with Mendelsohn & Co., then went to Southampton, England and took the Olympia back to New York where he reported to Carter at Guaranty Trust Company. Two days later Warburg gave his report to the entire Wall Street group, but "this time an English representative was there sitting next to Glean from Royal Dutch, a man named Angell, one of the heads of the Asiatic Petroleum Co." Warburg was questioned about Hitler, and "Rockefeller showed unusual interest in Hitler's statements about the Communists."
A few weeks after Warburg's return from Europe the Hearst newspapers showed "unusual interest" in the new German Nazi Party and even the New York Times carried regular short reports of Hitler's speeches. Previously these newspapers had not shown too much interest, but that now changed.6 Also, in December 1929 a long study of the German National Socialist movement appeared "in a monthly publication at Harvard University."
Part II of the suppressed "Financial Sources of National Socialism" is entitled "1931" and opens with a discussion of French influence on international politics. It avers that Herbert Hoover promised Pierre Laval of France not to resolve the debt question without first consulting the French government and [writes Shoup]: When Wall Street found out about this Hoover lost the respect of this circle at one blow. Even the subsequent elections were affected — many believed that Hoover's failure to get reelected can be traced back to the issue.
In October 1931, Warburg received a letter from Hitler which he passed on to Carter at Guaranty Trust Company, and subsequently another bankers' meeting was called at the Guaranty Trust Company of-rices. Opinions at this meeting were divided. "Sidney Warburg" reported that Rockefeller, Carter, and McBean were for Hitler, while the other financiers were uncertain. Montague Norman of the Bank of England and Glean of Royal Dutch Shell argued that the $10 million already spent on Hitler was too much, that Hitler would never act. The meeting finally agreed in principle to assist Hitler further, and Warburg again undertook a courier assignment and went back to Germany.
On this trip Warburg reportedly discussed German affairs with "a Jewish banker" in Hamburg, with an industrial magnate, and other Hitler supporters. One meeting was with banker von Heydt and a "Luetgebrunn." The latter stated that the Nazi storm troopers were incompletely equipped and the S.S. badly needed machine guns, revolvers, and carbines.
In the next Warburg-Hitler meeting, Hitler argued that "the Soviets cannot miss our industrial products yet. We will give credit, and if I am not able to deflate France myself, then the Soviets will help me." Hitler said he had two plans for takeover in Germany: (a) the revolution plan, and (b), the legal takeover plan. The first plan would be a matter of three months, the second plan a matter of three years. Hitler was quoted as saying, "revolution costs five hundred million marks, legal takeover costs two hundred million marks — what will your bankers decide?" After five days a cable from Guaranty Trust arrived for Warburg and is cited in the book as follows: Suggested amounts are out of the question. We don't want to and cannot. Explain to man that such a transfer to Europe will shatter financial market. Absolutely unknown on international territory. Expect long report, before decision is made. Stay there. Continue investigation. Persuade man of impossible demands. Don't forget to include in report own opinion of possibilities for future of man.
Warburg cabled his report back to New York and three days later received a second cablegram reading: Report received. Prepare to deliver ten, maximum fifteen million dollars. Advise man necessity of aggression against foreign danger.
The $15 million was accepted for the legal takeover road, not for the revolutionary plan. The money was transferred from Wall Street to Hitler via Warburg as follows — $5 million to be paid at Mendelsohn & Company, Amsterdam; $5 million at the Rotterdamsehe Bankvereinigung in Rotterdam; and $5 million at "Banca Italiana."
Warburg travelled to each of these banks, where he reportedly met Heydt, Strasser and Hermann Goering. The groups arranged for cheeks to be made out to different names in various towns in Germany. In other words, the funds were "laundered" in the modern tradition to disguise their Wall Street origins. In Italy the payment group was reportedly received at the main building of the bank by its president and while waiting in his office two Italian fascists, Rossi and Balbo, were introduced to Warburg, Heydt, Strasser, and Goering. Three days after payment, Warburg returned to New York from Genoa on the Savoya. Again, he reported to Carter, Rockefeller, and the other bankers...