GERMAN CHEMICAL POLICY
The preceding account of chemical warfare leaves the impression of a
successful Allied struggle against persistently unfavourable circumstances.
We were constantly compelled to accelerate to attain the pace set by
the enemy. There were exceptions, undoubtedly, but in the main Germany
kept ahead in the chemical struggle.
So far, in examining the root of our troubles, we have been content
to refer to the existence of the I.G., to describe its chemical
warfare activities, and to indicate, briefly, its unique power to
produce large quantities of organic chemical products at short notice.
The close connection between the German dye industry and chemical
warfare is now well recognised in official circles, and, to some extent,
by the general public. Its belated exposure was almost entirely
due to the facts revealed by the Inter-Allied Mission to the German
chemical factories some months after the Armistice.
But the situation thus revealed was not created in a day, nor by chance.
Indeed, one of the military features of industrial chemical development
in the I.G. has already been traced to pre-war activities.
I refer to the Haber process for the production of synthetic ammonia.
It would be short-sighted policy to accept the set of conditions against
which we struggled, and to explain them in terms of the I.G., without
looking more closely into the pre-war activities of this organisation.
Such an examination may reveal the basic forces which determined
our inferior position in chemical warfare at the outbreak of war.
It is true that we can explain away our inferiority by referring
to the German breach of faith, which automatically created conditions
for which we were unprepared. This is a comfortable solution.
But had chemical warfare been a strongly developed and accepted method of war
before the outbreak of hostilities, would we then have been prepared?
The records of the past, before April, 1915, must be consulted to answer
this question. We may find that our position is due to more than a mere
negative attitude, to more than our simple neglect of the organic
chemical industry. It maybe that there were forces which definitely
exploited this national characteristic to our disadvantage.
The pre-war policy and activities of the I.G. must be examined from
this point of view. In no country has such an investigation been
more complete than in America, and official statements have been issued
by the American Alien Property Custodian[1] which throw a flood of light
on the pre-war activities of the constituent branches of the I.G. They
conclusively reveal the existence of a carefully directed German chemical
policy making for world domination in the organic chemical industry,
which greatly hampered the military effectiveness of other countries,
and directly strengthened the military resources of Germany. On broad lines,
the pre-war and war activities of the I.G. produced the same result
as an attempt to strangle the economic life of possible opponents,
enfeebling their resistance to the subsequent delivery of a hammer blow
designed to take maximum advantage of the situation thus created.
Twenty years or more under the regime of a forceful economic policy,
not without its sinister aspects, prepared the ground by weakening us
in the concentrated chemical warfare which, ensued. The success of this
policy manoeuvred us into such a position that we barely escaped defeat
under the hammer blows of German chemical aggression. This, in fact,
appears to have been the German conception of modern war in its relation
to industry, and American reports have shown that it was carried through
with typical thoroughness by familiar German methods.
[1] _Alien Property Custodian Report_, Washington.
Government Printing Office, 1919.
Origin of German Chemical Monopolies.--The completeness of our organic
chemical deficiencies, and the thorough way in which we had failed
to develop organic chemical industries, creates such a sharp impression,
when thrown into relief by the outbreak of war, that we are led to
inquire into the methods by which these monopolies were established.
Let us admit, without any further delay, that Germany owed the origin
and assertion of these monopolies in part to her scientific development,
fostered by a vigorous policy of applying scientific research
to industrial enterprise. So far as her success depended upon
such factors, it merits our unqualified admiration and envy.
But stimulating these developments was a very definite general
and commercial policy which requires close examination.
German Chemical Commercial Policy;--Evidence of the
U.S.A. Alien Property Custodian.--Giving every credit to German
initiative and thoroughness in the application of science to industry,
we are still prompted to inquire how this monopoly came to be so complete.
We can rely on more than mere rumour, when examining the commercial methods
of the great I.G. The American Alien Property Custodian, Mr. Mitchell Palmer,
and, later, Mr. Francis P. Garvan, had occasion and opportunity to make
minute examination of the German dye agencies in America in connection
with general investigations on the reorganisation of alien property.
Their revelations truly merit the term, showing remarkably clearly
the unity of conception, determination of purpose, and co-operation
with the German Government which characterised the policy of the I.G.
Pre-war American Situation.--Let us briefly consider the relevant
aspects of the pre-war American situation. According to fairly
well-known facts, confirmed by the reports of the two American officials
mentioned above, the American pre-war organic chemical industry
consisted of little more than a series of small assembling plants.
Although enormous supplies of coal-tar products were available,
yet the dye intermediates derived from them were not made in America,
but imported from Germany. After various attempts to establish
the dye industry, it seemed, at one time, about 1880,
to have definitely taken root, but, within the space of five years,
there were only four dye producing establishments remaining.
German Price-cutting;--Salicylic Acid.--In every instance the manufacture
was almost immediately brought to an end by German price-cutting.
The same source reveals the direct and indirect methods used by
Germany to prevent, at all costs, the development of an independent
organic chemical industry. There are many pointed examples of
the direct method, and we will glance at the case of salicylic acid.
This is a very important chemical, used not only for certain important
drugs but also as in intermediate for dyes and photographic chemicals.
In 1903 the United States possessed five manufacturers of this product.
In ten years' time three of these had failed, and one of the survivors
was a mere branch of a German house. During this fatal ten years,
the product was being sold in that country at a price twenty-five per cent.
lower than in Germany. The manipulation of the prices of the other products
of the German monopoly enabled them, by such methods, to maintain it.
Many other examples, including such important products as bromine,
oxalic acid, and aniline, could be quoted to show the results of the German
price-cutting policy. The direct significance of bromine for chemical
warfare must be borne in mind.
Full Line Forcing.--Besides directly attacking the production
of raw materials and intermediates, the Germans used an indirect
method which has been described as "full line forcing."
They were the sole producers of certain specialities, such as
alizarine colours, anthracene colours, and synthetic indigo.
These were indispensable to the textile manufacturers,
and by refusing to supply them, except to houses which
would buy their other supplies from German manufacturers,
the latter could squeeze out home producers of simple dyes,
however efficient their production.
Bribery and Corruption;--German Patent Policy.--The dyeing
industry was peculiarly susceptible to corruption.
It was so simple for the head dyer of a mill to show
a partiality for dyes from any particular source of supply.
The American Alien Property Custodian very frankly tells us[1]: "The
methods of the great German houses in carrying on their business
in this country were from the first honeycombed with corruption.
Bribery of dyers was carried on almost universally on a large
scale. . . . So extensive was this corruption that I came across
only one American consumer that had escaped its ill effects."
Such were hardly the methods of decent commercial competition,
although it appears that the strong patriotic sense of the German
was able to justify, in his own eyes, what might be regarded
as reprehensible methods. This is not a question of bringing
up old reproaches, but merely of coldly examining facts.
We have already referred to their patent policy, whereby thousands
of patents were taken out, the only value of many of them,
being to cramp the productive initiative of possible rivals.
Professor Stieglitz explains how the German patents were useless
in developing large scale manufacture. "The patent protects
the product, but does not reveal the method." Sir William Pope
has also brought out this point, showing how the Germans use
thousands of bogus patents to protect their chemical industry.
He tells us,[1b] "In fact, some German patents are drawn
up for the purpose of discouraging investigation by more
practical methods; thus, any one who attempted to repeat
the method for manufacturing a dyestuff protected by Salzman &
Kruger in the German patent No. 12,096 would be pretty certain
to kill himself during the operation."
[1] _Alien Property Custodian Report_, 1919, p. 34.
[1b] _Science and the Nation_. A. C. Seward, F.R.S. Cambridge
University Press, 1917.
Propaganda and Information;--Espionage; Activities of
the Dye Agencies.--But another method which was used in this
commercial offensive, to which we must draw further attention,
dealt with propaganda and information. In his comprehensive report,
the American Men Property Custodian examines a number of large
industries and reveals how the German interest in these industries
through their American ramifications were active, "sowing the seeds
of German propaganda," and collecting information, both commercial
and military, for the use of the German Government and its agents.
Quoting again from this report, "In many of the large German-owned
companies taken over by the Alien Property Custodian, after investigation
it was found that espionage was one of the chief functions.
Every scrap of information of commercial or military value
to Germany was carefully gathered by the representatives of these
concerns in this country and quickly forwarded to the home office
in Germany. The German agents were particularly keen on gathering
information that would be helpful to Germany's commercial warfare.
Once in Germany, this information was carefully card-indexed
for the use of the manufacturers. Bulletins of commercial
information were also prepared and placed at their disposal.
In Germany, the collection of all commercial information is under
a bureau which is controlled and financed by the great German banks,
such as the Dresdner, Disconto, and Reichs Bank." This statement
is not mere generalisation, but is backed by innumerable examples.
Thus we find a light railway equipment manufacturer, a projectile company,
a wireless company, various magneto companies, insurance companies,
and German shipping companies, all engaged in spreading propaganda,
acquiring information, and influencing public opinion in favour
of Germany. But, undoubtedly more important than any of these,
and taking a leading part in the general scheme, was the German
dye organisation. The American publications make this quite clear.
Mr. Garvan goes so far as to say: "As long as you were supplied
by the big six (_i.e_. the I.G.), your business had no secret unknown
to Berlin. In Berlin you will find the card index system which
recites every fact connected with each and every one of your sources
which can be of any possible value to your rivals over there."
Referring to assistance rendered by various American and Allied
departments, including Military, Naval, and War Trade Intelligence,
we learn from the same sources: "All these bodies worked in close
co-operation and their mutual assistance was of inestimable value.
Information derived from these sources demonstrated that the chemical
industry was a natural centre for espionage and that this had been
true long before we entered the war--indeed, before the war began.
The relation between the German Government and the great German
chemical houses was so close that representatives of the industry
were naturally almost direct representatives of the Government,
and their work in this country gave them unequalled opportunities
for examining our industries from within."
With the outbreak of war, this organisation became more clearly defined.
It was, perhaps, difficult before the war to know where to draw the line
between purely commercial and actual governmental German activities.
The outbreak of war left no room for doubt. The German dye agencies became,
at once, the active agents of their Government in various schemes,
the nature of which we shall outline, and their "information" functions
became very definitely describable as espionage.
Manoeuvring Raw Materials.--In the first place, the Alien Property Custodian
found unexampled, evidence of a definite German scheme to corner and divert
certain important war materials destined for the Allies.
Chemical Exchange Association;--Doctor Albert's Letter.--Many such plots
could be quoted, but we will limit ourselves to one,[1] chosen because on its
stage move the chief figures of this espionage system. This case has been
described under the name of the "Chemical Exchange Association," and is much
more fitted for the pen of a Conan Doyle. The move appears to have been
initiated by Dr. Albert, the financial adviser of the German Government
in America, in collaboration with von Bernstorff. Its purpose was to
corner the immediate supplies of American phenol in order to prevent its
manufacture into high explosives, including the well-known picric acid.
The outbreak of war instantly stopped the entry of phenol into the country.
Further, this product was not manufactured there to any extent before.
Large supplies were required for the production of synthetic resins,
for the gramophone industry, This led to the development of a phenol industry
by the Edison works, and there appeared, automatically, a phenol surplus.
Dr. Albert, aware of the probable fate of this surplus as raw material
for allied munitions, determined to seize it for the German Government,
and he did this through Dr. Hugo Schweitzer, one of the most prominent
members of the American agency of the great Bayer works. In June, 1915,
Dr. Schweitzer contracted with the selling agents of the Edison Co.
for the entire surplus of phenol available for sale, offering a large cash
security which was furnished by Dr. Albert. A lapse of a week witnessed
another contract with the Heyden Chemical Works, a branch of the German house,
by which this phenol was purchased for conversion into salicylic acid and
other products. To avoid exposing the nature of the deal, Dr. Schweitzer
registered as the "Chemical Exchange Association." The profits amounted to
nearly a million dollars, half of which belonged to Dr. Schweitzer. This, we
are told, went immediately to the German Government. As a suitable
climax to such a venture, a dinner was given at the Hotel Astor by
Dr. Schweitzer in honour of Dr. Albert, and is described as a typical
gathering of the most active German propagandists in the country.
It was as a result of this deal that Dr. Albert sent Dr. Schweitzer
a memorable letter in which he praises his "breadth of highmindedness,"
and compares his work with "a military coup accomplished by an army
leader in destroying three railroad trains of forty cars containing four
and a half million pounds of explosives."
[1] _Alien Property Custodian Report_, 1919, p. 43.
Dye Agency Information System;--Dr. Albert on Chemical Warfare.--
Although a great deal has been said in America with regard to
the activities of Dr. Schweitzer and his followers, very little
has been heard on this side. Explaining the complete information
system possessed by the Germans, Mr. F. P. Garvan informs us
that the head of the system in America for years before the war
was Dr. Hugo Schweitzer, President of the Bayer Company there,
and he even quotes his secret service number given him by
the Imperial Minister of War, stating that he came to America,
became a citizen on the instruction of the German Government,
and led the espionage and propagandist movements down to the day
of his sudden death in November, 1917. The relationships between
Dr. Albert and Dr. Schweitzer, when the former was leaving for Germany
in 1917, are very illuminating. We learn from the same source
how Dr. Schweitzer received from the former nearly one and a half
million dollars, all to be spent in espionage and propaganda.
Dr. Albert, leaving Dr. Schweitzer a letter of appreciation,
to which we have referred in connection with the Chemical Exchange,
makes a very significant reference to chemical warfare.
"Of still greater and more beneficial effect is the support which you
have afforded to the purchase of bromine. We have a well-founded
hope that, with the exclusion of perhaps small quantities, we shall
be in a position to buy up the total production of the country.
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. Bromine is produced only
in the United States and Germany. While, therefore, the material
is on hand in satisfactory quantities for the Germans, the Allies
are entirely dependent upon importation from America." Making due
allowance for the fact that Dr. Albert was not a technical man,
this information possesses an element of truth, indeed France
was driven to the extreme of establishing a bromine industry
in the wilds of Tunis in order to counter the German attack.
The Moral Aspect.--Such facts tempt us to think hardly of these
representatives of German culture. But they were, no doubt,
fiercely patriotic Germans, and it is not difficult for us
to understand their activities after the outbreak of war.
An American, however, can hardly adopt such a lenient view, if, as has
been claimed, many of these agents were naturalised Americans,
for they were abusing the privileges and the confidence of their
adopted country. We have no wish, however, to dwell on this aspect
of the matter, and have no doubt whatever that many good Germans
could justify all these activities according to their own codes.
It would have been better not to have given this information
the light of day, were it not of some value for the future.
Report of the New York World;--German Policy Regarding Dye Supplies
to the U.S.A.--How far can the parent organisation of these
dye agencies be regarded as aware of their activities?
They were largely responsible for their inspiration.
Mr. Garvan says, "Practically all the dye salesmen were only
nominally in the employ of the branches here; all had secret
and personal contracts with the Home Office." From these facts
alone there can hardly be any doubt as to the connivance of the
home organisation. Again, on April 28, 1915, the _New York World_
printed an editorial explaining that "two large German chemical
and aniline dye concerns are reported to be establishing factories
in New Jersey, to supply American demands hither to supplied
from Germany." This statement apparently alarmed Captain Boy-Ed,
the German Naval Attache, and he communicated with Dr. Albert,
the financial representative in New York, for the establishment
of these factories would have countered the German policy
of bringing political pressure by refusing dye shipments.
Dr. Albert's reply to Boy-Ed contains the following phrase:
"With regard to the dyes, I got into touch with local experts
in order to determine what truth there is in the news.
According to my knowledge of things, the matter is a fake,
inasmuch as _*our factories have bound themselves orally
and by word of honour to do nothing in the present situation
which might help the United States_." As further evidence of this
definite policy, witness a letter from Consul-General Hossenfelder
to the Imperial German Chancellor, Dr. von Bethmann-Hollweg. This
letter is dated New York, March 3, 1916, and, after a detailed
examination of the economic relationships between Germany
and America, states: "Further, we should, according to my conviction,
hold ourselves absolutely passive in relation to the proposals
for the exportation of potash, chemicals, and dyestuffs,
and if the opportunity arises, make the sanction for them,
not dependent upon the consent for an exchange of articles,
but upon the abolition _en bloc_ of all hindrances to intercourse
contrary to international laws which have been instituted
by England." Further, Dr. Albert, cabling to the German Government
in April, 1916, on the export of dyestuffs, tells us:
"The hope was entertained of bringing American industries
which were solely dependent upon German deliveries of dyestuffs
into a position that they would have to insist on the importation
of dyestuffs under the conditions demanded by Germany." There can
then be no doubt that the parent organisation of the I.G. was
in close touch with the activities of its agencies.
This, then, is a brief account of the methods by which Germany created
the monopoly whose existence threatened our success in the world war.
Before leaving the question of the monopoly, let us inquire a little
more closely into its exact nature and range. Various American official
reports have revealed the desperate measures necessitated in that country
in order to meet deficiencies in vital products when the German source
of supply was removed.
Professor Stieglitz's Evidence.--Professor Stieglitz, of the University
of Chicago, giving evidence before the United States Senate, stated:[1]
[1] Hearings before the Committee on Finance, U. S. Senate, 1920.
"I have come to the conclusion that we would have saved a great deal of
suffering and a great many lives in this country, if we had had an organic
chemical industry, as they have in Germany, before we started the war."
Characterising the dye industry as the source of war chemicals,
including explosives and poison gas, he emphasises the drug question
and shows how their development depends absolutely upon the existence
of certain raw materials, and facilities for comprehensive organic
chemical research, which only find a _raison d'etre_ in the existence
of a flourishing dye industry,
Ehrlich's Discovery.--Pointing out the difficulties in developing
the manufacture of salvarsan, he explains how the process was
originally discovered by an organic chemist, Dr. Paul Ehrlich,
co-operating with a German dye company, the crude material coming
from the dye plants, the product itself strongly resembling dyes,
"containing arsenic instead of part of their nitrogen."
The great importance of this drug is brought out by another witness
before the same committee, Mr. Francis P. Garvan, who explains how,
by refusing or neglecting to ship salvarsan, Germany wanted the
United States "to starve to death" for lack of it, and he continues:
"Think what an extension of disease and that an intensification
of suffering and distress Germany was willing to impose upon
her best market in order to obtain her imperial will."
Germany had monopolised the production of the important
synthetic drugs, including the derivatives of salicylic acid,
of which aspirin had developed wide use in Allied countries.
After every household had learnt the value of German
produced aspirin, its supply was cut off at the outbreak of war.
The same disadvantages applied in the field of anaesthetics.
For a long period America had no local anaesthetics for hospital
surgical work, being compelled to use what were termed
"Bulgarian Operations," that is, operations without anaesthetics.
Professor Stieglitz claims that the lack of drugs and
anaesthetics threw back American surgery some fifty to seventy
years in civilisation.
But what of this country? We have already outlined how the outbreak
of war found us with, at the most, two or three relatively small
producing centres, which did valiant service during the war
and amply proved the importance of the dye industry by revealing
what could have been done had we been many times stronger.
Was the same German chemical policy responsible for our
pre-war position? As far as we know official investigations
have not been pursued to the same length as in America, but it
is beyond doubt that the German dye companies took every possible
step to stifle the development of our organic chemical production.
When the war broke out, our comfortable commercial contact
with the I.G. became a strangle-hold. It could not be otherwise.
Whatever the German attitude, and we could hardly expect it to
be friendly, the strangle-hold at the outbreak of war was inevitable.
But this dye menace facing our textile industries, and weakening
our power of retaliation in the chemical war, was not the only
danger from the I.G. We were in a critical position through failure
to produce other commodities than dyes.
Drugs and Medicinal Products;--The German Monopoly;--National Health
Insurance Commission.--The question of drugs assumed critical
importance at the outbreak of war. Germany had been asserting
her monopoly for years in the field of medicinal chemicals.
Cessation of supplies at the outbreak of war caused grave
apprehension of a serious shortage in these products,
so important for the adequate treatment of disease.
In some cases we possessed neither the raw materials nor
the technical knowledge to undertake rapid home production.
But in the important group of the synthetic drugs derived from
coal-tar products, the raw materials were produced in quantity in
the United, Kingdom, only to be exported to Germany, thus contributing
to her monopoly. British manufacturers, on the other hand,
held their own in the production of certain kinds of drugs,
such as the alkaloids, gaseous anaesthetics, and some inorganic
salts of bismuth and mercury. In a summary of certain war
activities of the National Health Insurance Commission, we read:
"It was chiefly in the making of the coal-tar synthetic remedies
that Germany was pre-eminent, and that position was due not to any
lack of skill or invention on the part of the British chemists,
but to the high degree of organisation attained by the German
chemical industry, which made it possible to convert the by-products
of the aniline factories into medicaments of high therapeutic
and commercial value."
The Royal Society;--Novocain.--So serious was the situation
that for some time we existed on feeble stocks. But during this
period the utmost efforts were made to develop our own production.
The Royal Society promptly came forward with a scheme to link
up would-be producers with appropriate centres of research.
The latter not only assisted production but actually produced sufficient
quantities of important drugs to tide us over the difficult period.
Thus, for example, for the production of novocain the assistance
of about forty university laboratories throughout the country
was invoked, and they proceeded to produce the intermediates,
diethylamine and ethylene-monochlor-hydrin. These substances
were converted into diethyl-amino-ethanol, and the final step,
the production of novocain, was undertaken by manufacturers,
including a prominent dye firm. We have referred to one of these
substances in connection with the German production of mustard gas,
and need only say that in England, in a time of national emergency,
the Government had to depend on the improvised assistance
of forty teaching and research institutions for the production
of small quantities of drug intermediates. Further, this work,
although to the permanent credit of those who undertook it,
did not enable us later to produce rapidly war quantities of
mustard gas, itself dependent on the same important intermediate,
ethylene-monochlor-hydrin. Germany settled the drug and mustard
gas question by a simple demand to the I.G., because the latter,
holding the indigo monopoly, possessed actual large-scale
ethylene-chlor-hydrin production.
Other cases, although equally creditable to those actually engaged
in the work, also reflect our national unpreparedness and neglect
of chemical industry.
Beta-Eucaine.--Beta-eucaine is a very important local anaesthetic.
Before the war we obtained it almost exclusively from Germany. When urgently
needed in 1915 for the War Office and Admiralty, the Government discovered
that it could not obtain this substance from commercial sources.
Seventeen laboratories co-operated to produce two hundred and sixteen
pounds of the material. Such examples would be ludicrous did they
not possess such a serious national aspect. Our position was almost
as desperate regarding chloral-hydrate, the important hypnotic,
and the rare carbo-hydrates required for bacteriological purposes.
Sir William Pope's comprehensive statement[1] supplies further examples.
[1] _Science and the Nation_, A. C, Seward. F.R.S. Cambridge
University Press, 1917.
Photographic Chemicals.--Our dependence upon German monopoly,
so drastically revealed at the outbreak of war, was not limited
to dyes and drugs, Photographic chemicals were of special importance
for war purposes, yet, when the development of aviation increased our
demands for photographic chemicals, we had no normal sufficient source
to which to turn. We needed not only the essential bulk chemicals,
such as amidol, metol, para-amidophenol, and glycine, but also
certain rarer substances, such as the photographic sensitisers,
which were so essential for the Air Force. By calling upon chemical
industry and research institutions both needs were satisfactorily met,
but the contrast with Germany leads perforce to the same conclusion,
their case and speed of production as compared with ours.
This examination shows the fine texture of the tenacious web by which Germany
had entangled and stifled the organic chemical industries of other countries.
Although at the outbreak of war the Allies were slow to realise the war
significance of the dye industry, yet they were quick to determine that
the resumption of peace would not find them in such an ignominious position.
Steps were taken to establish dye industries in England, France,
and America. Not only did plants spring up to meet the immediate
needs of the textile industries of the world outside Germany,
but the question received considerable Government attention.
Promises were made and steps taken to encourage the growing industries.
But these cannot be examined in detail here, and the main facts are
common knowledge. Two points emerge, however, which are of prime
importance from the point of view of our discussion. In the first place,
the acute needs of the armies prevented the maximum use of the war
opportunity for developing Allied dye industries on a sound basis.
No sooner was producing capacity installed, than it was taken over for
the production of urgently needed organic chemicals for explosives.
Dye enthusiasts would have regarded the war as a supreme opportunity
for a period of concentrated organic chemical research to make up
the leeway which existed, owing to forty years of German development.
But the research energies of the country were occupied on more
pressing problems. In Germany, the war chemical activities of the dye
factories all contributed to their future post-war strength.
In England and France it was otherwise. Our equivalent energies were
concentrated on developing improvised processes and plant, absolutely
necessary to counter the German attacks, but almost without exception
of no direct ultimate value to our peace organic chemical industries.
This is a point which merits careful consideration. These industries
voluntarily threw aside what was, logically, a great opportunity for them
to push their research investigations so necessary for eventual success.
The state-aided Huddersfield factory represented national vision, whose fruits
were stolen by our ceaseless need to improvise counters to German aggression.
But we owe to our dye industry the national recognition of these facts.
Stress of war gave us true vision, but prevented its logical outcome.
War needs are now removed, and everything should be done to place at
the disposal of the dye industries those facilities which they necessarily,
but gladly, sacrificed in time of emergency.
The brief survey of the preceding pages reveals the existence of a German
chemical policy pursued vigorously for many years before the war.
It also shows how this policy developed in America, the chief neutral country,
during the war period, for two years before her entry.
The Americans have also established beyond doubt the active
co-operation between the German Government and the I.G. But,
if the policy of the German Government and of the organic
chemical industry had many points in common before the war,
they became one before hostilities were many months old.
The part played by the I.G. in munitions production, in which it
was virtually a tool of the Government, has already been seen.
It must be remembered that, after the first Battle of the Marne,
the German Government turned to the I.G. for a large part of
its explosives and practically all its poison gas, and, as has
been stated on many occasions, and with reason, Germany would
not have been able to continue the war after the summer of 1915
but for the commercial development of the Haber process
by the I.G. The story is too well known to repeat at length.
The basic element of explosives is nitrogen, which is introduced
by nitric acid. This was produced from imported Chili saltpetre,
but the blockade cut short these imports, and but for the Haber
method, the vital step in producing nitric acid from the air,
Germany would have been compelled to abandon the struggle.
There is striking coincidence between the commencement of
the Great War and the successful completion of certain vital
German chemical developments. As late as 1912 Germany still
depended on other countries, chiefly England, for her phenol,
the basic raw material for picric acid as well as a dye necessity.
Soon after that date the development of the Bayer plant made
her independent in that product, and gave her, in fact,
an exportable surplus.
War Activities of the I.G.--Reviewing all these activities and realising
how they all emanate from this one organisation, we are overwhelmed by its
formidable nature as an offensive and defensive weapon in time of war.
Here we have an organisation, the I.G., whose sinister pre-war
ramifications dominated the world by their hold on the supply of organic
chemicals vital for peace and war. This organisation functioned,
in a sense, as the life blood of German offensive warfare.
German sources tell us very little of the war activities and future
significance of the I.G. A veil of secrecy seems to be cast
over the whole matter, but behind this veil must exist an acute
realisation of the value of the I.G. as a trump card for the future.
Krupp is uncovered, the whole world was alarmed at its meaning for war,
but heard with a comfortable sense of security how Krupp was
exchanging the sword for the plough. But the gigantic I.G. controls
in its great hand a sword or plough for war or peace at will.
This is no far-fetched metaphor.
The Rhine Factories and the Armistice,--It therefore becomes important
to inquire into the attitude and activities of the I.G. since
the Armistice, and to examine its position in world reconstruction.
For one brief period, the few weeks following the Armistice, the German dye
industries appear to have been without policy, its leaders in confusion.
But with the confidence inspired by the Allied Rhineland occupation,
with the assistance provided by the Allied controlling organisations,
with regard to labour, fuel, and commercial transactions, the industrial
morale speedily recovered.
The tide of revolution which accompanied the German debacle in
the autumn of 1918 swept over the Rhineland chemical factories.
Colonel Norris, writing on his visit in February, 1919, tells us
that after peace was restored by the Allied forces:[1]--
"the managers of several factories agreed that the occupation
of the territory was the best thing that could have happened.
On the other side of the Rhine, labour refused to work,
and demanded unheard-of pay--everything was topsy-turvy. In fact,
before the Allied armies arrived, revolutionary notions were
growing rapidly along the Rhine. One director of a well-known
chemical plant is said to have escaped by night with his life
by way of the river, when his employees were especially menacing.
When the British Army came he returned, and is now at his old post."
Thus, although the I.G. was model in its institutions for
the welfare of employees, at least one of its most prominent
directors was compelled to take refuge from infuriated labour.
What with danger from the latter, and the uncertainty of action
by the oncoming Allied troops, the future of the factories
appeared very gloomy. In fact, there are fairly credible
rumours that the German directors were willing to dispose
of their assets to the Allies while they remained intact.
But the same Allied troops, whose advent was feared, rolled back
the tide of revolution from the banks of the Rhine, and restored
industrial security. It is doubtful whether the investing
armies realised the full war significance of these factories,
except the French. The latter instituted a fairly thorough
control almost at once. But, judging from reports of
different missions to these factories, we were even backward
in organising inspection of the purely munitions plants.
Thus the Hartley Mission did not materialise until three
months had elapsed.
[1] _Journal of Industrial and Engineering Chemistry_, Vol. XI., 1919,
Page 817.
War Mentality of the I.G.--We watch a vivid impression of the war
mentality of the I.G. in a few phrases from Colonel Norris's account:
"Around the walls of the director's room was a beautifully painted
and artistic frieze which pictured the various plants of the
Bayer Company and their activities. Dr. Duisberg, the director,
pointed out proudly to the Americans the view of the company's plant
on the Hudson River. We were not surprised to see it, although pre-war
advertisements had assured us at home that Bayer aspirin had been made
on the Hudson for years by an American company. During the war an
ante-room had been decorated in a similar way, with pictures illustrating
the activity of the plant in the preparation of war-gas materials.
One saw how gas was made, shells were filled, and gas masks assembled.
The work was done by an artist, and has a permanent value.
The fact that the thing was conceived and executed during the stress
of war throws an interesting sidelight on German character."
Incidentally, it also throws a further sidelight upon the part played
by Leverkusen in the chemical warfare campaign.
German Attitude towards Inspection.--As was quite to be expected,
the German factories did not receive our missions with open arms,
and they were particularly jealous of any inspection at Oppau,
the site of the wonderful Haber synthetic ammonia plant.
Lieut. McConnel, of the U.S. Navy, tells us:[1] "Upon arrival
at the plant the Germans displayed a polite but sullen attitude.
They seemed willing to afford the opportunity of a cursory
inspection, but strongly objected to a detailed examination.
On the third day of the visit the writer was informed that his
presence had become a source of serious objection and that if his
examination were prolonged a formal complaint would be submitted
to the Peace Conference." The Allies had only themselves to blame.
Their facile yielding to the argument that this great arsenal
was principally of peace significance, owing to the fertilisers
which it would eventually make, and the feeble backing provided
for inspecting missions, were reflected in the semi-resistant
attitude of the I.G. personnel.
[1] _Journal of Industrial and Engineering Chemistry_, Vol. XI., 1919,
page 837.
The Rhine and Chaulny Contrast.--It was a curious contrast, however,
to pass through Chaulny on the way to the Rhine. At Chaulny,
the oldest chemical works in France, quoting again from
Colonel Norris, "where Gay-Lussac did his famous work on the
manufacture of sulphuric acid, where Courtois discovered iodine,
and where plate glass was first made, had grown with the times,
and was amongst the largest factories in France. Around it
was a thriving town of about 13,000 inhabitants, with some
excellent public modern buildings. When the Germans in their
first retreat were forced to leave the place, they dismantled
the factory and carried away everything that was portable.
The fortunes of war brought them back, and before they left
a second time a regiment of soldiers was put to work to destroy
systematically the factory and the entire town. For, a month
they kept at work, and when they withdrew but a few bricks were
left standing. Every boiler had been blown up with dynamite,
and every tank too heavy to be carted away rendered useless.
About half an acre was covered with chemical stoneware of
all kinds; each piece had been broken with a sledgehammer.
Nothing was too small or too large to escape destruction.
And to make sure of a good job, everything that would burn was
set on fire." Yet within twenty-four hours one met Germans,
in-directly or directly responsible for this policy of destruction,
resenting peaceful Allied inquiries on the munition activities
of their own plants. We hardly know whether to attribute such
effects of Allied policy to our own integrity in respecting
the peace activities of these arsenals or to official ignorance
of their war-like nature.
German Revolution and the Industrial Leaders.--It is curious how
the leadership of the captains of German industry was left untouched
by the revolutionary disturbances of the post-Armistice period.
Evidence is to be found in the composition of the main German delegation
to Paris for the settlement of the Versailles Treaty. Many of the
members were big industrial magnates, several had direct connection
with chemical industry, and at least one was a prominent director
of the I.G.
The German Peace Delegation.--Commenting on the composition of the main
German delegation in the spring of 1919, we find the German press
deploring the omission of any "visible representative" of Army
or Navy. Does this imply the presence of invisible representation?
Whether intended or not, there is truth in the implication.
The list contains the name of one of the leading representatives of
the big dye combine. Others of the delegates have chemical interests.
This is significant. It more than implies the German official
acknowledgment of the importance of the dye industry in general
for the future of Germany, and of its prime importance for war.
Recent Signs of Government Interest.--Recent developments
have merely strengthened the dye combine and provided
further evidence of Government interest in its welfare.
The chief signs of reviving. German Government interest in the I.G.
are to be found in the loan for the nitrogen enterprise and in
the privileges which it enjoys with regard to Government taxes.
An American source,[1] a witness before a Senate Committee,
reveals that the dye plants "have to pay no direct Government taxes.
According to an understanding with the present Government,
all organic chemical productions, the companies themselves,
as well as all dependencies, without exception,
for the next ten years, are freed from all direct State tax.
In so far as community taxes come into consideration,
I believe we will obtain a remission for our profession."
The latest sign of Government support is to be found in
the preferential treatment obtained by the German dye industry
in coal deliveries. Coal is a critical factor in the German
attempt to regain their monopoly.
Nitrogen Fixation.--The industrial fixation of nitrogen by Germany to form
ammonia has great importance from the point of view of our discussion.
Statements by various prominent Germans, such as Dr. Max Sering,
of the University of Berlin, and Dr. Hugo Schweitzer, already referred to,
leave no doubt. The former, writing in 1915, tells us:
"The complete cutting off of the supply of Chili saltpetre during
the war has been made good by our now taking nitrogen directly
out of the air in large factories built during and before the war.
With extraordinary rapidity the question has been solved how the
enormous quantities of the needed ammunition were to be produced,
a question which in England still meets with difficulties, in spite
of the help from America."
[1] Hearings before Committee on Finance, U. S. Senate, 1920, page 195.
The German Nitrogen Syndicate.--The two great Haber plants at Oppau
and Merseburg are both constituent parts of the I.G., and they
introduce a new element of Government interest into the I.G. policy.
Giving evidence before the Committee on Agriculture and Forestry
of the United States Senate, Colonel Joyce develops this question
of Government interest in detail. He tells us how war nitrogen supply
was energetically and specifically fostered by the German Government
through an Imperial Commissioner under the War Department. One of
the three advisers of this campaign was Doctor Bueb,
representing the Badische Anilin- und Soda-Fabrik. Colonel Joyce tells us:
"That was a strictly war control organisation, but even before
the war closed, Germany, with her usual foresight, was giving
consideration to the future commercial aspects of her nitrogen works,
and in August, 1919, there was definitely formed an association
of the producers which was called the Stickstoff Syndikat G.m.b.H.
or Nitrogen Syndicate. This designation is a commercial one,
and the organisation is along commercial lines, but it is,
reliably stated that the establishment of this syndicate was
largely due to governmental influence. This will be more easily
understood if it be realised that the German Government had given
financial assistance to many of the new plants and plant increases
which the war had necessitated."
Haber Process Prominent.--The Badische Co. holds a large part of the capital
stock of this syndicate, whose Board contains a Government nominee.
in addition the Board of Managers will have a Government chairman.
Through such arrangements, Government interest in the I.G. nitrogen
enterprise is clearly revealed. In conclusion, Colonel Joyce informs us,
"This information, which comes from most reliable sources and is
not to be disputed, shows that, beyond question, any one outside
of Germany producing or desiring to purchase nitrogenous fertilisers
or similar compounds, will have to deal with a single organisation,
essentially a branch of the German Government, which will have
an absolute monopolistic control of all such products produced in
Germany or whatever surplus there may be for export (Hearing before
the Committee on Agriculture and Forestry, U.S. Senate, S. 3390,
Mar. 22nd, 1920, p. 52)." It is reported that the preliminary allotment
of production to the Badische Co. in the Syndicate is three hundred thousand
tons per annum, which should leave a considerable exportable surplus.
This would constitute a formidable weapon in any price-cutting campaigns
entered upon by the I.G. in order to preserve her various monopolies.
We learn from the _Colour Trade Journal_ of August, 1920, that the
German Government has advanced something over ten million pounds
for the construction and operation of the Haber plant.
The New German Dye Combine.--Internal changes have accompanied
the development of these external relationships. The interchange
of capital and directors between the different branches,
the use of all assets for a common purpose, and the pooling of
all profits effected in 1919, has brought about a closer union.
From the relatively loose pre-war combination held together by common
price interests, the organisation has passed through the cartel
to what is now practically a form of trust. The German dye industry
is now a closely woven, almost homogeneous institution. It has added
economic cohesion to technical efficiency, and is to-day the largest
technically efficient potential instrument of war in the world.
We have thus revealed the existence, and indicated the nature,
of the resultant activities of the chemical policy guiding
the pre-war German combination of organic chemical or dye producers.
Further, it is seen how the war stimulated and sealed closer relationships
between the constituent firms, and between the resultant organisation,
the I.G., and the German Government. Continuing, we find the above
tendencies intensified since the Armistice, from unmistakable signs
briefly referred to above.
Aggressive Nationalistic Policy.--Both in peace and war,
the combination of interests, known as the I.G., has successfully
pursued an intensely nationalistic and aggressive chemical policy.
We might ignore what some have regarded as the sinister side
of the I.G. activities, considering the whole as a wonderful
monument to German science, thoroughness and patriotism,
which it undoubtedly is in many respects. But the significance
to the Allies and associated countries remains the same.
Even without any thought or intention on the part of present day
Germany to use this thing for war, it remains a serious menace.
But the direct evidence which we possess does not actually
support such a peaceful view. Her press confidently prophesies
the resumption of the pre-war German monopoly, reassuring its
readers by careful analysis of the causes of the eventful failure
to establish organic chemical industries in Allied countries.
Are we to yield in this field of economic war? If so, then one
of the chief lessons of the Great War will remain unheeded,
and the future cannot fall to prove this to the hilt,
to our cost.