DR. HEINRICH F. ALBERT, GERMANY’S BAGMAN AND BLOCKADE RUNNER
“And tell him that the struggle on the American front is sometimes very
hard.”—Dr. Albert.
* * * * *
To outwit John Bull on the high seas by running his blockade is a big
task. To compete against the combined commercial generals of England,
Russia, France and Italy in seeking trade in the Americas is a still
larger undertaking. But for one man to attempt both, while incidentally
keeping watch on the industrial growth of the United States and being a
big factor in Germany’s spy system, seems like a pigmy grappling with a
Hercules. The qualities requisite for the man who would accept such a
battle are diplomatic finesse of the highest degree, strength compared
to one of America’s kings of industry, a vast economic knowledge, the
shrewdness of a Yankee and the cleverness of the Kaiser’s ablest
strategist. Yet the responsibilities of such a manifold enterprise,
romantic in its infinite details and its vastness, were assumed by one
German.
You could find him almost any day until the break with Germany in a
small office in the Hamburg-American Building, the Kaiser’s beehive of
secret agents, at No. 45, Broadway, New York. He was a tall, slender
man, wonderfully supple-looking in spite of the conventional frock coat
and the dignified dress of a European business man. His clear, blue
eyes, his smooth face, thoughtful and refined, his blonde hair, and his
regular features suggested a man of thirty-eight, or even younger,
though you would look for a middle-aged or older man as selected for a
position requiring so many nice decisions. When you entered his room—and
few persons gained admission—he would rise and bow low and most
courteously. He spoke in a soft, melodious voice, was deliberate in the
choice of his words and encouraged conversation rather than made it. He
was the quintessence of politeness, a marked contrast to the clear-cut,
energetic, brusque, American business man—a smooth polished cog in the
steel machinery of Prussian militarism.
Yet this man was the centre of Germany’s business activities in America.
Upon him has rested the task of spending between $2,000,000 and
$3,000,000 a week for the German Government in the purchase of supplies
and in propaganda. His expenditure in furthering the cause has cost him
thirty millions of dollars outside the vast amounts spent in the
purchase of supplies, and he admits he wasted a half million or more
dollars.
He was Dr. Heinrich F. Albert, privy councillor to the German Embassy
and fiscal agent in America for the German Government. He was the source
of the funds used by the representatives of Germany, her secret
diplomatic and consular agents. He was the channel through whom money
flowed from the Imperial exchequer—unwittingly it may have been on his
part—to men who, in the interest of Germany, have violated American
laws.
His job was a big one because this war has demanded the help of
industry, as no other previous war. Just as it has resolved itself into
an enormous race between the industries of the combating nations in
turning out shells and arms, so Geheimrath Albert’s duties became all
the more multitudinous, really a part of the great conflict itself.
Dr. Albert had just as important work as his colleagues, the military
and naval attachés, but in a different field. With industrial
preparedness of greater importance in this than in any other war it is
natural that the commercial attaché and his staff of agents should prove
a most important asset to Germany’s secret service in America.
Geheimrath Albert’s duties in the economic field have been bound
inextricably with the aims of the Fatherland’s secret service. While
directing and financing the collection of data for use in the
preparation of reports to the home government, he has also worked side
by side with the other representatives of his Government.
THE EQUIPMENT OF A COLOSSUS
Albert was equipped for the gigantic task, as few men in the world have
been equipped. He knew finance, the economy of industry, the finesse of
diplomacy and the odd, yet scientific twists of the inventor’s mind. He
had been trained in the things that interested kings and the problems
that appealed to the labouring man. His field of knowledge was broad,
for in preparation for his tasks he had to seek the best commercial,
banking, industrial methods and inventions of the world to help Germany.
So successful was he that his friends have termed him “The German
Yankee.”
Around no German official in America has there hovered so much mystery.
A great bulwark of Germany’s propaganda—though no participation in any
illegal or criminal acts has been charged against him—he might have
remained the greater part of the war under cover had it not been for the
activity of secret service agents and for a little nap which Geheimrath
Albert, the courteous and overworked, took upon an elevated train one
day. When he awoke, his dossier was gone. That portfolio contained a
mass of wonderfully illuminating documents, so many and so varied that
if the privy councillor is accustomed to take up in one day so many
diverse matters it almost staggers the imagination to try to conceive of
the tasks which this war brought him. Through them public and official
attention was fastened upon him, serving to deepen the folds of mystery
about him. Through them the public in America first learned of the
vastness of German propaganda. Dr. Albert lost his portfolio in August,
1915.
In the quietness of his little office above humming Broadway and within
calling distance of the gold-lined Wall Street into which he so
constantly pried, Geheimrath Albert discussed momentous economic
problems with Germany’s other big men. In the German Club in the
evenings he continued those consultations. In trips to Washington and
Chicago and New Orleans and San Francisco, he and his agents conferred
with big German business men.
His close confidant was Count von Bernstorff, with whom he had a joint
account of several millions of dollars in the Chase National Bank, New
York. His two active colleagues were Captain von Papen and Captain
Boy-Ed. The association with these men must have been very close and
keen; for on von Papen’s recall Dr. Albert wrote him: “I shall feel your
departure most keenly; our work together was excellent and was always a
great pleasure to me. I hope that in the Fatherland you will have an
opportunity for making use of your extraordinary talent in dealing with
economic questions. When I think of your and Boy-Ed’s departure and that
I alone remain behind in New York, I could—well, better not!”
Dr. Albert learned the output of the steel industries and the financial
connections of the big corporations. He had accurate information about
the electrical manufacturing concerns in this country, their output,
their inventions, the ability and the accomplishments of the engineers
at the head of those plants, their training and personal history. He
knew all about America’s transportation systems, their financial
strength and the real mechanical and constructive ability of the
scientific men connected with those systems. His information was as
broad as his American activities. Suffice it to say that it was Dr.
Albert’s business to get these facts—and he did so.
HIS VIEW OF THE FUTURE
How Dr. Albert looked to the future is set forth in a report which was
prepared for him on June 3, 1915, by a trade representative in the
German General Consulate, New York, on the effect of the British
embargo. This document, compiled by a scientist, was undoubtedly only
one of hundreds of such instruments worked out by Germans in this
country for the help of the Fatherland. In this paper the writer, named
Waetzoldt, says:
* * * * *
“There can be no doubt that the British Government will bring into play
all power and pressure possible in order to complete the total blockade
of Germany from her foreign markets, and that the Government of the
United States will not make a strenuous effort to maintain its trade
with Germany....
“It has been positively demonstrated during this time that the falling
off of imports caused by the war in Europe will in the future be
principally covered by American industry....
“The complete stopping of importation of German products will, in truth,
to a limited extent, especially in the first part of the blockade, help
the sale of English or French products, but the damage which will be
done to us in this way will not be great....
“The _Lusitania_ case did, in fact, give the English efforts in this
direction a new and powerful impetus, and at first the vehemence with
which the anti-German movement began anew awakened serious misgivings,
but this case also will have a lasting effect, which, unless fresh
complications arise, we may be able to turn to the advantage of the sale
of German goods....
“The war will certainly have this effect, that the American business
world will devote all its energy toward making itself independent of the
importation of foreign products as far as possible....
“If the decision is again brought home to German industry it should not
be forgotten what position the United States took with reference to
Germany in this war. Above all, it should not be forgotten that the
‘ultimate ratio’ of the United States is not the war with arms, but a
complete prohibition of trade with Germany, and, in fact, through
legislation. That was brought out very clearly and sharply in connection
with the still pending negotiations regarding the _Lusitania_ case.”
* * * * *
Dr. Albert received among many reports one giving an analysis of the
trade here in war materials:
* * * * *
“The large war orders, as the professional journals also print, have
become the great means of saving American business institutions from
idleness and financial ruin.
“The fact that institutions of the size and international influence of
those mentioned could not find sufficient regular business to keep them
to some extent occupied, throws a harsh light upon the sad condition in
which American business would have found itself had it not been for the
war orders. The ground which induced these large interests to accept war
orders rests entirely upon an economical basis and can be explained by
the above-mentioned conditions which were produced by the lack of
regular business.... These difficulties resulting from the dividing up
of the contracts are held to have been augmented, as stated in business
circles, by the fact that certain agents working in German interest
succeeded in further delaying and making worse American deliveries....
“So many contracts for the production of picric acid have been placed
that they can only be filled to a very small part.”
* * * * *
A MAN OF MYSTERY
Naturally one of the most vital problems that stirred Dr. Albert was the
British Order in Council in regard to the blockade of Germany from which
resulted the seizure of meat and food supplies and cotton by British war
vessels. He was always on the alert for information as to what was the
attitude of the Administration and the people of the United States
toward the blockade. That he used secret and perhaps devious means to
get it is revealed by a confidential report which he received under most
mysterious circumstances concerning an interview by a man referred to as
“M. P.” with President Wilson and Secretary Lansing. “M. P.,” according
to the conversation, claimed to have received from the President “a
candid, confidential statement in order to make clear not only his own
opposition, but also necessarily the political opportunity.” A striking
part of this conversation follows:
* * * * *
“L. advises regarding a conference with M. P. Thereafter M. P. saw
Lansing as well as Wilson. He informed both of them that an American
syndicate had approached him which had strong German relations. This
syndicate wishes to buy up cotton for Germany in great style, thereby to
relieve the cotton situation, and at the same time to provide Germany
with cotton. The relations of the American syndicate with Germany are
very strong, so that they might even possibly be able to influence the
position of Germany in the general political question. M. P. therefore
asked for a candid, confidential statement in order to make clear not
only his own position, but also necessarily the political opportunity.
The result of the conversation was as follows:
“1. _The note of protest to England will go in any event whether Germany
answers satisfactorily or not._
“2. _Should it be possible to settle satisfactorily the Lusitania case,
the President will bind himself to carry the protest against England
through to the uttermost._
“3. _The continuance of the difference with Germany over the Lusitania
case is ‘embarrassing’ for the President in carrying out the protest
against England._...
“4. A contemplated English proposal to buy cotton in great style and
invest the proceeds in America would not satisfy the President as an
answer to the protest....
“5. The President, in order to ascertain from Mr. M. P. how strong the
German influence of this syndicate is, would like to have the trend of
the German note before the note is officially sent, and declares himself
ready, before the answer is drafted, to discuss it with M. P., and
eventually to so influence it that there will be an agreement for its
reception, and also to be ready to influence the press through a wink.
“6. As far as the note itself is concerned, which he awaits, so he
awaits another expression of regret, which was not followed in the last
note—regret together with the statement that nobody had expected that
human lives would be lost and that the ship would sink so quickly.
“The President is said to have openly declared that he could hardly hope
for a positive statement that the submarine warfare would be
discontinued.”
* * * * *
WHAT HIS SECRET CORRESPONDENCE REVEALED
Dr. Albert also was in close communication with the American branches of
German industries. This fact is apparent from secret correspondence
found in his dossier, showing how after much deliberation and
consultation a group of German representatives in America forbade the
American branch of a German firm to fill a Russian war order. This
correspondence shows that the American branch first sought information
as to whether or not it should fill the order either as a means of
making money or, secondly, as a means of delaying the Russian Government
in getting the material. One of the Embassy staff wrote suggesting that
the Ambassador approve of the acceptance of the order as a means of
hindering the Allies. After a conference it was reported:
* * * * *
“In my opinion it would be hazardous for your firm to ship locomotives,
cars, or wheels to Russia. All these transportation means would lighten
the transport of troops, ammunition and provisions for the Russian
Government, and your firm would, within the meaning of Paragraph 89 of
the (German) Penal Code, be rendering aid to the enemy thereby.... That
you are in a position to delay the delivery of the order to the
prejudice of the hostile country ordering them will in no measure
relieve you from liability.”
* * * * *
GERMANY IN THE STOCK MARKET
When it appeared that the Kaiser would not yield to demands made by the
President, the prices of stocks went down and Germans bought stocks
cheaply. After they loaded up a liberal supply, word would come that
Germany was yielding and the stock market would become buoyant, thus
allowing the German group to sell hundreds of thousands of shares on a
substantial profit. _There is absolutely no doubt that as a result of
every crisis the German Government realized millions of dollars in the
market._
An instance of how Dr. Albert had opportunity to get into the market is
revealed in a secret letter written to Dr. Albert on July 8, 1915, by a
well-known Board of Trade German in Chicago, and associated with a group
of German traders. In this letter he refers to Dr. Albert’s “principal,”
presumed to be no other than the German Government or the Kaiser
himself. His letter says:
* * * * *
“Provisions have been horribly depressed by severe liquidation. We
firmly believe that purchase of September lard will make your principal
a great deal of money. September lard closes tonight at $8.65. This,
with high freight added, will cost under 10 cents delivered Hamburg,
where actual prices are around 35 cents per pound.
“I do not want to appear over persistent, but there never was a better
proposition than buying this cheap lard for September delivery.”
* * * * *
One of Dr. Albert’s functions was to sift this commercial information
and make recommendations to Berlin. He would confer with his coworkers
on all military and naval matters having a commercial phase. That he did
so is proved by the reports which they made and which went to Dr. Albert
for his consideration and further recommendation. Captain von Papen, on
July 7, 1915, submitted to Dr. Albert a memorandum headed, “Steps taken
to Prevent the Exportation of Liquid Chlorine,” in which he tells of the
efforts made by England and France to buy that chemical in America,
tells of the output here, and the firms turning it out.
THE SHIP PLOTS
Another matter of importance to which he gave thought was the problem
which had been in every German mind and mouth since the beginning of the
war, namely, the prevention of the shipment of war supplies to the
Allies. A letter mailed to Dr. Albert from Chicago under date of July
22, 1915, sets forth how zealously his agent was working on an embargo
conference with the aim of arousing sentiment in this country against
the export of arms and ammunition. The letter says that he had obtained
the co-operation of a United States Senator, a Congressman and other
Americans in this project.
One letter from Albert’s agent runs thus:
* * * * *
“I must refrain from communicating the above facts in my report to the
Ambassador, as the matter could be too easily compromised thereby.
Perhaps you will find an opportunity to inform Count von Bernstorff
verbally. As soon as the matter has first gained more headway, I believe
Mr. von Alvensleben, who has taken part in the whole development here,
will come to New York in order to inform the Ambassador fully regarding
prevailing frame of mind here as well as regarding the movement,
provided, however, that is desired.”
* * * * *
Letters from Detroit suggested a plan for a general strike of the
automobile workers in that city as a mighty protest against shipment of
arms. The strike would cost about $50,000.
NEWSPAPER PROPAGANDA
To Dr. Albert also was assigned the task of studying sentiment in this
country regarding the war and taking steps to influence it in favour of
Germany—in other words, highly paid press work. Through Dr. Albert
arrangements also were made for many German professors, either in
Germany or connected with American institutions, to give up their
occupations as teachers and devote themselves in America exclusively to
lectures before high-class audiences. In these talks the speakers
devoted themselves to showing the friendly relations between Germany and
the United States, the similar aims of both countries in industry and
international affairs, and to arguing for the cordial support of
Germany’s cause.
A complete organization was tabulated of journalists throughout the
country who were sympathetic with the German cause. These men received
news for publication in various papers, also instructions. By the aid of
these men a vast amount of information was gathered and shunted along to
Dr. Albert. In addition Dr. Albert gave consideration to still more
elaborate plans for the purchase of newspapers, the starting of news
syndicates and information bureaus which, apparently neutral, should be
secretly allied with the German cause and supported by German money.
These facts were shown by a number of papers bearing on publicity and
methods of acquiring it which were found in his dossier. The papers show
that in one instance he was subsidizing a weekly paper and that in
return he demanded a certain policy.
The following letter throws some light on the subject:
* * * * *
“I request the proposal of a suitable person who can ascertain
accurately and prove the financial condition of your paper. From the
moment when we guarantee you a regular advance, I must—
“1. Have a new statement of the condition of your paper.
“2. Practice a control over the financial management.
“In addition to this, we must have an understanding regarding the course
in politics which you will pursue, which we have not asked heretofore.
Perhaps you will be so kind as to talk the matter over, on the basis of
this letter, with ——.”
* * * * *
Plans for the purchase of an English daily in New York which would
support the German cause were worked over at length by Dr. Albert and
his assistants. Proof also that Dr. Albert and his associates
contemplated the creation of news bureaus in New York and Berlin which
would furnish and disseminate throughout the United States news
favourable to the German Government is given in the memorandum prepared
apparently by an expert newspaper man, outlining the plan and cost of
organization and giving certain suggestions.
Dr. Albert gave consideration to the suggestion of paying the expenses
of American newspaper men who would go to Germany and send back articles
favourable to the German cause. He did so under orders from von
Bethmann-Hollweg, the German Imperial Chancellor, who caused one of his
aids to write to the German Ambassador a letter suggesting that certain
journalists be invited to visit Germany.
EFFORTS TO OUTWIT THE BRITISH BLOCKADE
Varied and important as were these various duties, already mentioned,
still the paramount task to which Dr. Albert devoted himself was a
scheme to outwit England’s blockade of Germany. This tall, silent man,
working in his little office, was concerned with the purchase of
millions and millions of dollars’ worth of supplies—cargo after
cargo—for shipment to Germany, direct or through neutral countries. In
this campaign he used every means of deceiving the enemy that were in
his power.
Let it be said that this is meant as no reflection on Dr. Albert. In war
one nation may establish a blockade and the other nation will attempt to
run it. International lawyers agree that one nation has a right to
establish such a blockade. If the shipowner obtains ingress to the port
he makes big profits by the sale of his goods, but if he is caught by
the other belligerent he loses his ship and cargo. It is a gamble.
It has already been established as a part of international law, through
decisions of Lord Stowell in England more than a century ago and of the
United States Supreme Court during the Civil War, that if it can be
shown that shipments of supplies to a neutral country are really
designed for transhipment to a belligerent, then the enemy has a right
to seize and confiscate those goods.
After the Orders in Council were issued by England, Dr. Albert sought
first to make the embargo unpopular in America. Letters and other
documents in his dossier show that plans were submitted to him for
stirring up sentiment in this country against what was denounced by
pro-Germans as arbitrary seizures on the part of Great Britain. For
instance, Edward D. Adams of 71, Broadway, New York, who for many years
was a representative in that city of the Deutsche Bank, sent a letter to
Dr. Albert in which he makes the following suggestion:
* * * * *
“The South politically is of very great importance to the Democratic
Party and to the re-election of its representatives at our next
Presidential election. The Cabinet and Congress have represented in them
Southern men to a considerable number who are keenly alive to the
importance of keeping the Democratic Administration in close touch with
the Southern voters, and it takes such action from time to time as will
secure their sympathy and support.”
* * * * *
Likewise plans were worked out for the arousing of the meat packers in
Chicago to protest to Washington over the seizure of meat ships bound
for Germany by way of neutral ports.
German representatives studying public sentiment in this country also
suggested to Dr. Albert that indignation against Great Britain could be
aroused by making it appear as if the British blockade was hurting
America in preventing the receipt here of various non-contraband
articles from Germany. One associate wrote to Dr. Albert:
* * * * *
“From a German standpoint, the pressure on the American Government can
be strengthened by the interruption of deliveries from Germany even if
the British Government should permit exception. Those shipments
especially should be interrupted which the American industries so badly
require; withholding of goods is the surest means of occasioning the
placing before the Administration in Washington of American interests.
Those protests have the most weight which come from American industries
which employ many workmen.”
* * * * *
In the early months of the war Dr. Albert was a buyer of enormous
supplies of cotton, wheat, copper, lubricating oil and other articles
needed by Germany for the prosecution of the war. He signed contracts
for meat and other supplies amounting to millions of dollars and he made
payment the moment the ships were loaded here so that the American
seller got his money regardless of what happened to the cargo while on
the high seas. Of course, after the German Government seized all food
supplies, the British Government took the attitude that all food
supplies bound for Germany were intended for the Government and were
therefore contraband. In the next place all purchases of food or other
material by Dr. Albert as the official representative of the German
Government made them Government supplies and therefore contraband of
war. The moment the British Government discovered that these articles
were purchased by Albert, no matter whether they were bound for neutral
countries, or not, England argued she was justified in seizing the ships
and confiscating them. But as a fact, England paid the American shippers
in most instances.
All the facts in the vast scheme mapped out by Dr. Albert for outwitting
John Bull’s blockade, have been developed by the Attorney-General of
England and set forth in the prize courts there. It has been shown that
Albert backed the purchase of cotton by the shipload, that he acquired
vessels under neutral flags for carrying these cargoes to neutral
countries. He spent millions of dollars in the purchase of meat. For
instance, Dr. C. T. Dumba, Austro-Hungarian Ambassador, writing to Baron
Burian from New York, tells of an interview in Chicago with a beef
packer.
“No fewer than thirty-one ships, with meat and bacon shipments from his
firm to Sweden, with a value of $19,000,000, have been detained,” he
says, “in British ports for months under suspicion of being ultimately
intended for Germany. The negotiations have been long drawn out, because
Mr. Meagher and his companion will not accept a lame compromise, but
insist on full compensation or release of the consignments in which the
bacon may still remain sound.”
A TWO-FACED PROPAGANDIST
Dr. Albert issued a statement which purports to be a complete reply to
the charges in regard to a secret German propaganda in the United
States. He said that the purchase of ammunition plants in this country
was justifiable, argued for an embargo on arms and ammunition, charged
Great Britain with piracy on the high seas, denied that the German
Government financed press agents, and asserted that the German
Government had not started any under-cover newspaper campaign in this
country. He said it was inevitable that all sorts of wild and
irresponsible offers, proposals and suggestions should be addressed from
every conceivable quarter to one holding the official position in which
he was placed as an accredited agent of one of the great nations engaged
in this unfortunate world-wide war. He referred to the strike letters as
junk, and said that he should not be held responsible for every crank
that wrote him a letter.
That statement was for the American public. Dr. Albert’s real sentiments
are shown vividly in a letter which he wrote to Captain von Papen from
San Francisco after the announcement of the President’s decision to send
the military attaché out of the country. Here is part of it:
* * * * *
“Well, then! How I wish I were in New York and could discuss the
situation with you and B. E.! Many thanks for the telegram. The ‘Patron’
also telegraphed that I was to continue the journey. So we shall not see
each other for the present. Shall we at all before you leave? It would
be my most anxious wish; but my hope is small. For this time, I suppose,
matters will move more quickly than in Dumba’s case. I wonder whether
our Government will respond in a suitable manner! In my opinion, it need
no longer take public opinion so much into consideration, in spite of
its being artificially and intentionally agitated by the Press and the
legal proceedings, so that a somewhat ‘stiffer’ attitude would be
desirable, naturally quiet and dignified!
“If you should leave New York before my return, we must try to come to
some agreement about pending questions by writing. Please instruct Mr.
Amanuensis Igel as precisely as possible. You will receive then in
Germany the long-intended report of the expenses paid through my account
on your behalf. I would be very thankful to you if you would then
support the question of a monetary advance which you know of, although I
know that I was mistaken in my opinion, that I acted as your
representative and according to your wishes.”
* * * * *
When all the work of Dr. Albert is summed up and taken into
consideration with his propaganda in association with Captain von Papen
and Captain Boy-Ed, the impression remains that he, a guest of the
United States, was immersed in plans that were aimed at the honour and
integrity of this republic.