by Joseph Borkin and Charles A. Welsh
extracted from 'Germany's Master Plan - The Story Of Industrial Offensive'
No better insight into the German strategy of economic war could be contrived than the history of Interessen Gemeinschaft Farbenindustrie Aktiengesell-schaft, commonly known as I.G.*
* Community of Interest of Dye
I.G.'s commercial peacetime monopolies have been the support
for its services to Ger- man militarism. I.G. has never foregone an
opportunity to turn a pretty penny in a business sense, however, if
Germany's interest permitted. Time after time financial profit has
been subordinated by I.G. to nationalistic aims. While I.G. may
prefer to gain its own ends and enhance the power and wealth of
Germany by economic means, it has consistently abetted and given
force to purely military plans. The audit of I.G.'s contributions to
Germany's martial designs is long.
The glory of a major scientific
contribution belongs to Perkin and to England, but Germany usurped
the gain. At the time of his discovery Perkin was only 18, still a
student of the famous Professor Hofmann at the Royal College in
London. Perkin had started out, strangely enough, to prepare
artificial quinine. He wound up with a delicate purple solution
called mauveine, which was to give name to the Mauve Decade, and to
color the future military and industrial history of the world.
genius and patriotism been given the recognition it merited, England
could have become the leader of the organic chemical industry. What
is more, there might have been no I.G., and without I.G. Germany
could not, twice within a generation, have filled the vials of wrath
and hurled their Prussic acid in the face of the world. What might
have been was not to be. Perkin's brilliance could not compensate
for the dilettante attitude of the universities toward chemical
research or the dullness of official and financial minds.
When Perkin's next contribution to the
industry, the preparation of an equivalent for natural red dye
(madder), was announced and patented, he found that Dr. Caro of the
Badische Anilin Works had been before him. Perkin's patent was dated
June 26, 1869, Caro's had been issued June 25. The processes were
somewhat different, but the Germans had won a major research victory
symbolizing their capture of the initiative in the field, which they
These firms are:
* See Appendix.
These concerns in time became known as the "Big Six" and were from their inception primarily responsible for the amazing growth of the German chemical industry.
Germany's economic might was "built out of a sandbox" by her chemical and metallurgical industries, and the Big Six were the principal artificers of the gigantic structure. The methodical but almost frenetic determination which inspired German research did not observe any scruples in "borrowing" inventions from other countries.
As Perkin told the story to Lord Exmouth:
The attitude taken by the German chemical concerns toward the industries of other nations reflected the same chauvinistic inspiration that underlay her political and military views:
While this psychological motivation may
have been mystical and even irrational, the commercial relations of the Big Six exhibit a completely realistic "trading philosophy" in
the course of their transactions with other countries and in the
adaptability of their management to domestic political and social
The British Government became aware that the German economic offensive had been mounted, and that the citadel of Eng-land's historic industrial leadership had been surrounded. That the tactics of I.G. today are an extension of the early practices of its forebears is witnessed by the statements of Joseph Chamberlain in 1883 and Lloyd George in 1907.
Chamberlain, speaking in support of the proposed compulsory licensing of patents in Great Britain, said:
In commenting on this, Lawrence Langner, a "well-known authority on International Patent Law, says:
Lloyd George reiterated Chamberlain's view in 1907, in discussing prospective revision of British patent law, stating that:
In 1904 one of the decisive events of
modern economic history transpired almost unnoticed. Dr. Carl Duisberg, one of Germany's foremost chemists, later Chairman of the
Board of I. G. Farben, prepared a special report in which he
proposed the complete unification of the Big Six into an Interessengemeinschaft.
Mutual competition was
eliminated, and technical experience and resources were pooled, with
the result that the German twins had attained an almost absolute
monopoly in the organic dyestuffs, pharmaceutical, explosive, and
synthetic chemical industries of the world. Within a few years the
two groups were fully united, and in 1916, when the Weiler ter Meer
and the Griesheim Elektron companies were brought in, I. G. Farben's
internal integration was complete.
The preparation for the first "Chemists' War" in those ten years was carried on with characteristic Teutonic thoroughness. The chemical industry was welded into a huge arsenal. The economic structures of the countries which stood in Germany's way were corroded by systematic infiltration of I.G.'s chemical patents.
Germany in 1904 was
dependent on Chilean deposits for the nitrates used in fertilizers
and explosives. The outbreak of the war was delayed several years
until I.G. had perfected the Haber process for artificially fixing
nitrogen. Literally, I.G, plucked enough nitrates from the air to
feed German farms and cannon.
It should be pointed out that the
dyestuff plants required no "conversion" either to the manufacture
of gases or explosives. The basic and intermediate dyes are in
themselves the direct sources of numerous military products.
Ludendorff, Chief of the German General Staff:
Even today we do not know exactly when
I.G. produced the new type of T.N.T. which was used in German
shells. Germany lacked aluminum for metal alloys and thermite bombs.
I.G. brought forth magnesium. If Germany finally succumbed, it was
not for want of anything that I.G. could do.
The invaluable knowledge thus
accumulated was analyzed both by the German Government and by a
central industrial bureau. This mass of data, which included
geographic surveys, plant blueprints, working methods, and every
conceivable fact which might be relevant, was the original basis of
geopolitical science. The I.G. Sekretariat in Berlin has been, since
its formation, a clearing house for the observations of its
representatives, and undoubtedly possesses a quantity of such data
existing nowhere else on earth.
The British Chemical Mission in March 1920 reported that:
An American observer, Lieutenant McConnel of the United States Navy, states:
A foreign representative of the duPont company in 1920 said:
Late in 1925, the present I.G. Farbenindustrie was organized, including in its framework the preponderant bulk of German chemical companies.
At the time of its
renaissance, I.G. was capitalized at well over a billion marks and
became, by virtue of its enormous plant, working force, and
interests, one of the greatest industrial combinations in history.
The reborn I.G. launched at once upon a massive program to unify
control of the German economy. Krupp, Metallgesellschaft (the metal
trust, partly government-owned) and Siemens-Halske became willing
brothers-in-arms, under the aegis of I.G.
As stated before the Temporary National Economic Committee, the "colossal ramifications" of I.G.'s interests cannot be exhaustively indicated.
It is probable that even after the protracted investigations by students and by government which have been under- taken in recent years, not all of I.G.'s links to American industry or to South American markets have been brought to light. It is even more certain that all of its relationships outside this hemisphere have not been disclosed.
Yet we know enough of them to state that I.G. at the outbreak of war in 1939 surpassed any single industrial group in the world in its scope of influence, in the diversity and range of its interests, and in the magnitude and comprehensiveness of its affiliations.
It is estimated that I.G. is a party to
or the actual promoter of several hundred international cartels.
Consequently there is sufficient excuse for coining a term which
conveys a more accurate impression than monopoly or cartel. Perhaps
by compounding the idea of universality and absolute control a term
such as "panopoly" would be more fitting. In any case,
represents the acme of pan-Germanism in the economic sphere.
The thrice-reincarnated I.G. was to become the chief advance agent of the Third Reich in the latter's pre-war machinations, not only for the pur-pose of hewing out the ultimate features of the autarchy so long sought by Germany, but to sap the economic structure of the chosen opponents.
In the Four Years' Plan promulgated in 1936, it was announced that,
Need it be said that the only world governed by reason,
in the view of the authors of this plan, would be ruled by Germany,
which has never quite comprehended why other countries were so
"insane" as to be unwilling to accept such rule?
Werner Brack in 1938 said,
He might well have added that its drive
for world-rationalization of the industries in which it was
interested fitted neatly into the new schemes of world-domination
nursed by German militarism.
At the same time, it is clear that
I.G.'s chief reliance was placed on the political density and
financial greed of those with whom it dealt. The keenest business
instincts, when not modified by industrial wisdom, can become a
weakness, and on this weakness I.G. counted in nearly ail of its
transactions. Canny traders of the American type were to prove
almost naive when matched against the acuity and perspicacity of the
exponents of I.G.'s economic philosophy.
The web of contracts in the dyestuffs
industry, the pharmaceutical industry, the oil industry, the
synthetic rubber industry, the magnesium industry, and others, all
promoted by I.G. with leading American concerns, affected the
military preparedness and economic independence of the United
States. Even today, they force us to do without materials,
processes, and industries which in the normal course of competition
would have been fully established at the outbreak of the war.
Each of the Big Six companies and the other major concerns included in I.G.'s first unification in 1904, or in its reorganizations in 1916, 1919, and 1925, was in itself a merger of many, in some cases scores, of smaller companies.
Each of the Big Six was in its own right
a cartel which represented not only the vertical integration of its
particular phase of the chemical or metallurgical industries, but a
horizontal association of smaller concerns operating in the same or
closely related fields. Consequently, when we speak of I.G. it must
be kept in mind that I.G. is at the same time a national cartel in
its broadest sense as well as the greatest of all international
A dispatch in the New York Times of December 1, 1919, from its Berlin correspondent, stated:
These figures in themselves would not entitle I.G. to the status and prestige which it occupies among the financial titans of industry. There is, however, a major qualification to such estimates. It is customary among German cartels to underestimate, rather than overestimate, capital assets in order to conceal their real size.
It is probable that the real capital assets of I.G. as they stood at the outbreak of war in 1939 were only slightly below those of Standard Oil, and were certainly greater than the resources of any other concern in the same industry.*
* Liefmaim in "Cartels, Concerns, and
Trusts," places I.G.' assets ahead of the Royal Dutch Shell Oil
I.G.'s plants are located in those very cities which have been among the primary bombing objectives of the Royal Air Force, and in all probability provide the specific targets for such raids.
The names of many of the towns in which the principal I.G. plants are located will therefore strike a familiar note to those who follow the headlines.**
** See list in Appendix.
is a good deal of geographic concentration of the I.G. plants, they
are sufficiently de-centralized from both an economic and military
stand-point to make the job of bombing them difficult and dangerous.
Various experts have called the roll,
but never with final assurance. With similar reservations, the firms
which I.G. is known to own, or control, are set forth in the notes
below. In scanning this list, it becomes clear that I.G. is the
industrial ruler of Germany. Its non-German interests bulk almost as
"Dye Industry" is a misnomer. It is true, of course, that I.G. grew out of the dye industry, but in a larger sense, its functions are as unlimited as the scientific application of physics and chemistry to raw materials. In each of the broad areas designated as a field of production there are nearly always a large number of separate products and processes involved.
In some cases,
such as that of coal tar dye-stuffs, there are tens of thousands of
different crude, intermediate, and finished materials which fall
within the general class.
Even if I.G. were confined exclusively to the chemical industry, which it is not, the enormous possibilities within that sphere would kindle the fantasy of any writer of weird tales or horror stories. More important, however, is the fact that throughout its entire domain I.G. always has the power of choice to make products or to use processes which can benefit or injure mankind.
This duality of the industry is graphically illustrated in the testimony given by Captain O. E. Roberts, Chief of the Industrial Relations Section, Chemical Warfare Service, United States Army, before the Judiciary Committee of the United States Senate in 1922.
Speaking of the chemical industry in general, Captain Roberts said:
The possibilities of this industry,
which may include any of the several hundred thousand known organic
chemicals or of the millions which are figured as possibilities, are
enough to stir anyone's imagination.
When it is recalled that I.G. produces synthetic medicines,
vitamins, hormones, serums, and specifics, some of which are not
even known in other countries, it is understandable that its success
in opening up new markets throughout the world and in penetrating
the markets of others is in part attributable to its consistent
policy of trying to lead the field. Knowledge, to I.G., means power.
The total number of employees of I.G. and its direct subsidiaries is estimated at about 350,000. It is worth recording that I.G.'s labor policies are paternalistic and, for the most part, predicated upon the native docility and tractability of the German worker.
Many of I.G.'s employees live in what,
in the United States, would be called "company towns," and
historically, it has been part of I.G.'s policy to adopt the type of
"social reform" initiated by Bismarck. When the National Socialist
Workers' Party seized the government and incorporated all German
labor into an enormous company union with the state as ultimate
employer, I.G.'s workers were, of course, included. In fact, I.G.
personnel made up one of the first "Strength-Through-Joy" units.
But I.G. as a politico-economic entity, the embodiment of cameralist Germany, has the immediate importance of an additional army or a fleet. Again, no demon-theory is necessary in interpreting I.G.'s history from 1919 to 1939. I.G. is supervised by a "doctorate" whose ranks include today, as in its beginning, the scientific aristocracy of Germany.
Nearly all of I.G.'s directors are
doctors of chemistry, physics, engineering, or economics. For
personnel, I.G. has been able to draw upon a populace which has been
trained for generations in applied science. Herbert Hoover drew
attention to the fact that there were two and one-half times the
number of research workers in Germany that were engaged in
comparable callings in the United States in 1925.
The World War had shown up certain, weak spots in the German armor. Continuing the lines of research begun before 1914 was not enough. The difficult task of rearming would be futile, unless any new war could be started with a wider margin of advantage than in 1914. This requisite superiority required that Germany become an absolute autarchy, able to supply all of its own domestic wants.
Self-sufficiency, if complete, could
withstand indefinite blockade.
Patents were applied for and obtained "en masse," in every country having a patent system, but largely in Germany, England, and the United States.
But patents were the oldest
and the least of I.G.'s tourniquets on the economic vigor of
Germany's likely antagonists. The improved cartel device was used
both to invade and to occupy strategic sectors in the economies of
the then disunited nations. The cartel was I.G.'s formula for
The famous Buna rubbers were the reward of these experiments. The Bunas are made from petroleum.* Germany had little oil. I.G. hydrogenated coal into oil, and at a single stroke made possible the mechanization of the Reichswehr.
Army at this very moment travels in tanks and trucks propelled by I.G.'s synthetic fuels, and shod with Buna rubber.
* The essential ingredient of the Bunas is butadiene, a refinery by-product. This component can also be made from alcohol or coal.
and magnesium plants, and improved processes of production, largely I.G.'s own, were ready when the time came to fabricate planes.
Beryllium, tungsten carbide, and new steels were forged to be used
in armor plate, shell tips, and machine tools. Since all metals are
precious in Germany, I.G. produced new plastics to take their place
in consumer goods, and replenish many munitions sup- plies.
vitamins and sulpha drugs to remove this danger in the
future. If Germany was to regain her lost colonies, geopolitical
that fighting would have to take place in the tropics. The quinine
of Java was far away, and German troops would risk jungle fevers.
I.G.'s answer to this prospect was atabrine - better than natural
quinine for the quick cure of a sick soldier.
prevented the complete exploitation of Africa's wealth by the white
I.G.'s adroitness is evident in the report published in the British Medical Journal in 1922:
While no action by the British Government was ever made public, and no official explanation ever given, I.G.'s "bargain" was obviously not accepted.
As it later
turned out, Germanin was not so effective in human sleeping sickness
as in mice or in test-tubes charged with the causal parasite. But
the motif of the episode ties into and connects the pattern and
purpose of I.G. research. Political control of Africa could not be
bought, but I.G. could still get economic colonies not only in
Africa, but elsewhere.
effect of I.G. discovery and I.G. cartel restriction on the
development of other countries has only to be set forth to assume
its true proportions. Every time some government official or
industrial executive speaks of a scarcity of chemicals or metals,
the chances are abundant that somewhere along the line there was an
international cartel, and that the letters I.G. are inscribed on a
I.G. had cartel agreements:
I.G.'s cartel agreements with Imperial
Chemical Industries, with Norwegian, Dutch, French, Belgian,
Italian, Spanish, and Polish concerns were, until the outbreak of
the war, a true society of nations, industrially speaking.
Inasmuch as superficially legal methods are used by I.G. in its acquisitions, as in the case of the Etablissement Kuhlmann, the French chemical company, I.G. apparently hopes to win its own war even though Hitler loses.
In the case of American industry, I.G.'s foresight provided for a modus vivendi during the war and a settlement of claims afterward. American industry has been victimized twice.
Will it be victimized in the
future by the resumption of the same enticing "collaboration" in
joint world-monopoly or by the "settlements" anticipated by I.G.?