-Caveat Lector- <A HREF="http://www.ctrl.org/"> </A> -Cui Bono?- an excerpt from: Treason's Peace Howard Watson Armbruster©1947 A Crossroads Press Book Beechurst Press New York 438 pps. -- First/Only Edition -- Out-of Print --[13]-- CHAPTER XIII Good Neighbors, and Bad GEHEIMRAT SCHMITZ, Director von Schnitzler and Professor Herlein, who send their best regards to Mr. Diebold and you, are very happy over the valuable support and assistance that you have extended to us. With this expression of gratitude Dr. William E. Weiss, of Sterling received the thanks of Farben's top leaders for defeating the British blockade by supplying Sterling-made drugs to Farben's outlets in Latin America where they could be sold as German products. The letter was written to Dr. Weiss by Dr. Wilhelm R. Mann, the Farben director in charge of Bayer, on February 8, 1940, in Florence, Italy, after an extended conference with Earl McClintock, head of Sterling's Latin American affairs, who had gone to Italy to meet the Farben leaders to make a deal which would protect their joint business dealings from injury by the war, and from certain seizure as soon as the United States should enter it. Other excerpts from these Farben war-time greetings to Sterling's Fuehrer are as follows: Our conferences were held in the spirit of trust and friendship that you, dear Dr. Weiss, strove in such an understanding manner to create already in times of peace . . . Your and our power will lead us to a solution which will not mean relinquishing our pre-war position. I view the future with calm, confidence and trust, which will be influenced by you and our work, by our experience, by the strength of the knowledge of our collaboration . . . we are living today only to fulfill our duty to serve our Fatherland. Mac (McClintock) will tell you the rest; he was, and is, a splendid interpreter of your thoughts and wishes, but also a true friend of our common interests . . . May the time soon come when we can emerge from the darkness of these months into the light, and continue our activities! Dear Dr. Weiss, my revered friend, I clasp your hand! In true and devoted friendship. Always yours, Wilh. R. Mann. Several years previously when America was still being lulled to sleep by assurances that we could deal profitably with Hitler, and that war was an impossibility, Sterling's management had begun conferences with Farben's leaders about the dangers to their Latin American partnership that would arise when war began. In 1938, McClintock went to Europe to ask Farben to sign a document in blank by which, if need be, a transfer to Sterling of the Latin American inventories and machinery could be recorded. Negotiations continued at conferences in Europe and in New York, but when the war began the assets of Sterling and Farben were still hopelessly scrambled in various Latin American countries. Sterling's requests for a blanket assignment were refused, and Farben countered with proposals that new outlets be formed which ostensibly would be owned by Sterling but actually would be operated by Farben agents. The most active and influential of the Farben pre-war agencies in Latin America were those which handled Bayer aspirin and similar drugs; where, as in the United States, with customers in every hamlet, and advertising before every eye, they created a huge machine, and an effective screen, for espionage and propaganda. So, when the British blockade cut off Farben's exports to Latin America late in 1939, Sterling rushed into the breach and began shipping quantities of aspirin, Winthrop specialties and other drugs, in bulk, or in cartons and packages which closely resembled Farben's. The Farben agents frequently were not required to pay Sterling for this merchandise. When it was sold, the proceeds were retained—for Gestapo purposes. Late in 1940 it became evident that the situation might lead to trouble because of Sterling's too direct dealing with German agents. So what appeared to be an entirely new set of branch houses, owned and operated exclusively by Sterling, was organized. The plan was to continue taking care of the Latin American business in Bayer aspirin and other Farben-Sterling preparations under cover of these new houses. These Sterling storm cellars, known as Farma companies, were actually erected in seven Latin American countries during the first half of 1941, some of them after President Roosevelt's freezing orders of June 18, 1941, which tied up all German assets in this country. This order of course covered all such partnership arrangements as Sterling had with Farben. This was also the period of the justice Department dragnet investigation into the relations of Sterling's executives with Farben (referred to in Chapter IX) which was halted by Attorney General Biddle. Even up to the last moment, William E. Weiss apparently never gave up hope of inducing Farben to turn over the Latin American aspirin business (worth a million a year in profits) to Sterling, for the duration, on some basis that might block action by the United States Government. On August 14th the day before Sterling submitted its proposals to the Government to break its already outlawed agreements with Farben, Weiss sent a long cable begging his Frankfurt friends to consent. The Farben directorate replied tersely insisting on fulfillment of their partnership agreements. The extent of the assistance which Sterling's executives had rendered Farben's agents, and were still arranging to give when threats of criminal indictments became a reality, was indicated in later statements that, subsequent to the consent degrees, the company destroyed more than 100,000,000 pieces of advertising and packaging prepared for its Farben Latin American brigade. The material destroyed carried Farben's trademarks such as Cafiaspirina, Bayer Aspirina, Instantina and Tonico Bayer, at a cost for printed matter alone of $100,000. The total cost of Sterling's alleged housecleaning, including repackaging of huge stocks bearing Farben's trademarks, closing all of the old offices, and liquidating all of its branch tie-ups with Farben, and its 1941 Farma branches, was in excess of $450,000, according to a statement which Sterling's new Chairman E. S. Rogers, filed on February 10, 1942, with the Interdepartmental Committee of the Government. This was to prove that the face lifting operation on Sterling was not a mere relabeling, but a true reform and rebirth of Americanism. Sterling and Farben had disposed of over a quarter million pounds of aspirin in Latin America in 1938, enough to produce over 300,000,000 five-grain tablets. But it also takes a tremendous number of Bayer Aspirin tablets to make a $100,000 bill for new cartons and circulars. A vivid indictment of Sterling's part in the Farben-Nazi activities in Latin America was pronounced by former Assistant Attorney General Norman M. Littell. after he was removed from office in December 1944, because of differences with Attorney General Francis Biddle on the Corcoran affair. Mr. Littell's accusations, as they appeared in the Congressional Record were in part: In many cases the funds of this business were diverted from the German agents to spread German propaganda. Payments were made to I.G. Farben's agents in South America and supplies were sent to German agents in South America. The German Bayer Co. in Rio de Janeiro was accused of diverting funds to the German embassy; and Renata Kohler, head of the German Bayer Co. was accused in Brazil of being a Nazi Agent. A new branch of the Bayer Co. of New York was organized in Venezuela in March 1941 and a German citizen was made the head of that branch. Many of the agents in South American countries were exposed as Gestapo agents, as abundant records in the State and the Department of justice will show . . . . . . every avenue of trade penetration was used for political propaganda, collection of strategic information about foreign countries, and efforts to suppress the development of strategic industries in areas which might be hostile to Germany. As an example, in 1934, I.G. Farbenindustrie and Sterling Prod-ucts agreed to use their advertising as a political weapon and decided that notoriously anti-German newspapers should not receive any advertisements for Cafiaspirina or other products showing the Bayer cross ..... These actions were carried out under the direction of William E. Weiss, President; Earl I. McClintock; A. H. Diebold, and other personnel, some of whom owed their positions to I.G. Farbenindustrie, which had sent them to this country. A few months later, in June 1945, Assistant Secretary of State William L. Clayton brought out some of the State Departments secrets when be testified before Senator Kilgore's Sub-Committee about the Farben "safe havens" in foreign countries; where, he said, the facilities for another war were being bidden. Among other exhibits which the Assistant Secretary introduced were several reports made to Farben by its Latin American agents as late in the war as July 1943. These contained references to the activities of the Farben sister firms in various South American countries, and the ease with which drug supplies were still made available to Farben's agents in certain countries, until things tightened up. Mr. Clayton then identified the sister firms as Farben's cartel associates, or former associates, in the United States. And in the State Departments' famous Anti-Peron Blue Book issued in February 1946, stress was laid on the part played by Farben's Quimica Bayer and Anilinas Alemanas in furnishing financial support to the pro-Nazis of the Argentine, and in assisting in building up secret intelligence service on the political, social and economic life of the country. Let it be stated that Sterling was not the only Farben affiliate in the United States which "helped out" Farben's Latin American agents after Winston Churchill locked them inside a ring of floating steel. There was the old established dye stuff jobbing firm of Fezandie & Sperrle which took over, as a blind, the export of General Aniline dyes to Farben agents who were on the British and American blacklists; also Rohm & Haas as mentioned in Chapter IV, began taking care of the blockaded South American agents and promised faithfully to give them back to Farben when the war ended. Advance Solvents & Chemical Co., of New York, another Farben affiliate, joined in this war emergency relief of Farben's customers. And Standard Oil of New Jersey, faithful unto death, also continued to supply gasoline through its South American sales branch to Nazi airlines operating across the South Atlantic. It is interesting to note that in arranging for General Aniline to take over Farben's South American business in the last months of 1939 after the war began, two executives who handled the matter were our old acquaintances E. K. Halbach, president of General Dyestuff, and Rudolph Hutz, vice-president of General Aniline. It may be recalled that Halbach and Hutz were officials of the Badische and Bayer American fronts during the first World War, so they already knew just what to do and how to do it. A Farben sub-manager in the Argentine, named Alfredo Mon made the arrangements for blinds or dummy houses there through which Fezandie & Sperrle, a New York Farben ally, shipped General Aniline dyes which ultimately reached Farben agents. It was a game of double dummy-one at each end—and Farben took all the tricks. In November 1941, some one in General Aniline attempted to have Moll, who worked with Halbach, approved by the Treasury and State Departments as the company's representative in the Argentine. This was after Judge Mack had become president of General Aniline and Homer Cummings was its attorney. Every known Farben agency in Latin America was at that time on the State Department's official blacklist. Moll, who was well connected in the Argentine, is reported to have sold out his interest in Anilinas Alemanas, the Farben dyestuff subsidiary, and retired as its manager just before the company was blacklisted. As the Treasury agents caught up with the identity of the various dummy fronts set up by Moll for Fezandie & Sperrle, Moll would then arrange new ones. Finally some of the Treasury rough-neck squad cracked down and put Fezandie & Sperrle out of business. But Alfredo Moll retained his standing, or his stand-in, with the State Department—which, with characteristic blindness apparently continued not to disapprove of Farben's ex-manager. Meanwhile the office of the Alien Property Custodian, after taking over General Aniline in 1942, is reported to have permitted Moll to act as its sales agent in the Argentine. In midsummer of 1943, Mr. Moll still had friends in high places; according to an official of the Alien Property Custodian's office it was not necessary to blacklist everyone just because he had dealings with Farben. In supplying gasoline to the Fascist South American Lati and Condor Air Lines, Standard Oil alleged compulsion to do so under the terms of a binding contract, but according to one government official in testifying before the Truman Committee in April 1942, no such contract existed. When, in October 1941, Standard Oil refused to comply with the State Department's request to desist, Assistant Secretary of State, A. A. Berle, Jr., announced that steps might be taken to put Standard's Brazil subsidiary on the blacklist. Mr. Berle, of sterner stuff than some of his colleagues, used the diplomatic "perhaps" but obviously meant "no." Blacklisting would have been a solar plexus smack on Standard's protestations of patriotism; still worse, it would have prevented Standard from supplying anything to its Brazil subsidiary, either for Nazi planes or for any other customers. The objectionable deliveries of gasoline ceased forthwith: call it voluntary compliance—or shotgun diplomacy, and divorce for cause. According to other testimony before the Truman Committee in April 1942 by William La Varre, South American expert of the Commerce Department, the two Farben affiliates, Standard Oil and Sterling, were among the few American corporations that did not fully cooperate with Government agencies in eliminating Nazi agents in their operations in Latin America. Late in November 1941, on the eve of Pearl Harbor, Attorney General Biddle described to a Congressional committee a manual of instructions for German spies which contained propaganda and espionage directions for both North and South America. Significantly Mr. Biddle added that the Nazi organization in the United States worked ostensibly without a chief; through individuals who might not even know of the existence of other operators. A few days later, on December 5, 1941, in a public address, Mr. Biddle protested the immense amount of propaganda coming into this country, some of it intended for distribution in Latin America, and demanded identification of "its source and financial backing . . . so that the public shall know and judge." Official -identification of the companies and individuals thus accused or suspected of propaganda and other subversive activities in the United States and Latin America, did not emerge. Rather did they tend to submerge under an unfortunate policy of inaction. However some of the evidence which persistent inquiry made available is revealing—so it is now possible to comply with Mr. Biddle's request of December 5, 1941, "so that the public shall know and judge." For example, in one of the frank protests by the British Minister of Economic Warfare in May 1941 he named William E. Weiss, and Earl I. McClintock, of Sterling, and described the activities directed by these gentlemen in South America as: Financial assistance (which) they have heretofore felt obliged to render to a country which is now unblushingly engaged in trying to make both hemispheres unsafe for democracy. So, too, the press statement credited to Assistant Attorney General Thurman Arnold on September 25, 1941, relative to the Sterling consent decrees, contributed a ray of light on the subject with the comment about German control of drug outlets in South America: as "one of the most effective instruments of propaganda and German influence in this hemisphere." When this 1941 statement was issued, Mr. Arnold had before him certain evidence pertaining to the subject which, on Mr. Corcoran's instructions, Mr. Arnold was not permitted to present to the Grand jury. Lack of space makes it impossible to do more than outline such material here. It is voluminous. The Treasury report, already referred to, which was originally prepared for an Inter-American Conference to discuss Latin American problems in June 1942, indicated the official conclusion that the "Personal fealty" or "close personal relationships" of individuals involved in the I.G. Farben business tie-ups bad aided the latter: To finance propaganda, sabotage, and other subversive activities in the United States and other areas (Latin America) of strategic importance to this country . . . As an example let us examine the 1933 message sent to Max Wojahn, the Sterling-Bayer manager of its exports to South America from the Farben Board of Directors, dated March 29, in which employes of Farben in foreign countries were told to hold their noses and refrain from objecting to the indecencies practiced by the New Order in Germany, and . . . immediately upon receipt of this letter to contribute to the spread of information as to the actual facts in a manner in which you . . . consider best adapted to the conditions in your country and to the editors of influential papers, or by circulars to physicians and customers; and particularly to stress that part of our letter which states that in all the lying tales of horror that is not one word of truth (italics underlined in original document). Instructions of this character came to the Sterling organization in Latin American companies in accordance with the original agreements with Farben, which provided that German Bayer, or I.G. Dyes, should sup[e]rvise and share various expenses, including Latin American advertising and propaganda. Out of that beginning had come mutual ownership by Farben and Sterling of a lengthy string of branch houses and sub-agencies in Latin America, also other agencies owned solely by Sterling or Farben. The -stake for which Farben played in Latin America, assisted by its tie-ups with huge corporate entities in the States, was the ultimate control of both continents. And, unbelievable as they may appear, there are proofs that Farben affiliates in the United States, directed by native-born American citizens, actually took care of a large share of Farben's expense for these subversive activities. Let it be read with shame that this continued even after the United States by Lend Lease and other actions, had allied itself definitely against the Nazis. The fact that much of the evidence of how such activities were financed by Americans seems to have been pigeonholed in the files of the State, justice, Treasury and Commerce Departments, may appear to be as bad, or worse, than the treachery thus immu-nized. In Colombia, the country nearest to the defenses of Panama, Farben branches had as advisers with excuse for frequent visits two distinguished "American" citizens who were closest to the top Farben leaders—Deitrich Schmitz, as director of Colombia's Anilinas Alemanas; and Walter Duisberg, as "Visiting" director of Colombia's Quimica Bayer. Both of these ersatz "Americans" made frequent business trips to Colombia-as the day approached when the possible destruction of the. Panama Canal might mean the destruction of liberty on both continents. According to the Treasury report referred to, Farben placed assistant business managers in its branches in eight Latin American countries who knew nothing about the business but were there solely for political purposes and for espionage and sabotage. While these Farben activities, directed at the security of the American continents, were taking place in Latin America, a barrage of high-class pacificist propaganda was laid down by the Farben directed Board of Trade for German-American Commerce. This propaganda, circulated in the most influential circles of American industry, finance and politics, included such appeals as the following excerpts from the German-American Commerce Bulletin of March 1941: And what about Germany's trade with the Latin American countries? Germany has not the slightest intention of destroying American trade with Latin America. Her trade with the Spanish American Republic's has never and never will consti tute a threat to the U. S. A. . . . Therefore a side-by-side rather than a counterplay of German and American interests in South America is not only desirable but inevitable. In these days when the military conflict is still the immediate issue, Germany already thinks in terms of a peace . . . which offers unlimited opportunities for the restoration of the old as well as the development of many new ways for mutually beneficial trade . . . Having thus disposed of all menace to the United States by appeal to the commercial instincts of American business leaders and politicians, the editorial concluded with this tender of appreciation for the efforts of the Farben cartel partners: There is still a sufficient number of influential people in the United States who have a realistic understanding of present events, and therefore demand that America preserve her independence and freedom. of action for her own sake. This course includes the maintenance of peaceful relations with the German people. As Farben's Dr. Mann wrote to Sterling's influential Dr. Weiss in the letter cited at the start of this Chapter: I view the future with confidence . . . influenced by . . . the knowledge of our collaboration. The high talent of Sterling during the 1940-41 period of pinchhitting for Farben in Latin America, among others included David Corcoran (brother of Thomas) in charge of the Sidney Ross Company, export subsidiary with its numerous Latin American branches which prior to that time had been distributing only such Sterling patent medicines as Fletcher's Castoria, Phillips' Milk of Magnesia, and Cascarets; in which Farben presumably had no direct interest. Weiss (who died in 1942) and Diebold, both were forced off the Sterling Board in December 1941, as result of the agreement on which the consent decrees were based. Of the others involved in guiding Sterling during the period of continued cooperation with Farben in Latin America, and in the United States, Messrs. Rogers, McClintock, James Hill, Jr., G. S. Hills and George C. Haigh continued in the saddle. In December 1941 shortly after Pearl Harbor, Sterling blithely announced in the press that it was beginning an economic war against German domination of Central and South America with the purpose of strengthening American defense efforts throughout all parts of the Western Hemisphere. This economic war was inaugurated in Mexico City with large scale advertising by press and radio and a parade of pretty Senoritas handing out samples of Sterling's Bayer Aspirin which had been renamed Majoral in Latin America; and a procession of trucks carrying enlarged photographs of Sterling Radio stars heard on Mexican broadcasting stations. In addition to Majoral the Mexican campaign included other Sterling trademarked remedies such as Phillips' Milk of Magnesia, Ross Pills, Adams Tablets, Glostora and Fletcher's Castoria. As this "national defense" drive to push Sterling's widely advertised preparations in the Southern Hemisphere got under way, the methods of the old time pitch artists were revived and refined, with the use of sound trucks, free moving pictures, and, in one instance a modernized show. boat which chugged its way up to river towns in the Republic of Colombia-the advertising of patent medicines being blended in with moving pictures and messages on the blessings of hemispheric solidarity. Another novelty in the sale of such products was introduced by Sterling's when "bullboards" were used instead of "billboards" as outdoor advertising of its product Majoral, the name being painted on the sides of the bulls that went to their doom in view of shouting thousands in Latin American bullfight arenas. And in Mexico City it was reported that a parrot was being trained to shout Majoral, but either the word or the remedy was too much for the bird, or perhaps it was not a pro-Farben member of the feathered family, as this psychological warfare stunt failed to- materialize. According to reports, more than 10,000,000 free samples of Majoral were given away and more than one million dollars was expended during the first twelve months in advertising this new aspirin trademark in the press while another million was spent advertising other Sterling preparations; along with several hundred radio shows from Latin America's leading broadcasting stations. The fleet of autos and trucks equipped with sound equipment and motion picture projectors for propaganda concerts and shows increased to nearly two hundred and the Majoral drive was proclaimed as the biggest American promotional job ever undertaken in Latin American history. As one of the conditions, or Sterling promises, which led up to the Sterling consent decrees in 1941, all employes of Sterling in the United States and in South America were carefully scrutinized, and supposedly those with pro-Nazi affiliations were removed. That some were discharged, and a few in the United States interned, has been stated, but the list has always been an official-and a Sterling-secret. However, an unfortunate incident occurred in 1943, when the F.B.I. arrested a Spanish Count named Cassina at the export offices of Sterling in Newark, New Jersey, where he was being trained to become a field agent in Brazil. The company stating that this man had been employed in good faith by Sterling on the basis of high recommendations. On December 20, 1943, Cassina pleaded guilty to a charge of failing to register with the State Department as an agent of the Nazi Government, and was sentenced to a term in jail to be followed by deportation. He bad been sent to America in November 1940 by Gestapo agents who expected him to furnish information to Germany through letters to his father in Spain. An example of the official attitude of the State and Treasury Departments and the Board of Economic Warfare was a refusal by those agencies to comment in writing on two peculiar radio broadcasts delivered by Earl 1. McClintock, over Station WMCA in June and July 1942. In these radio addresses the former financial aid of the Democratic National Committee told his listeners that he had just returned from South America, then explained at some length why a certain well-informed Chilean believed that his country should not declare war on the Axis. These broadcasts were delivered at a time when the United States Government was making desperate efforts to induce both Chile and the Argentine to join the other American nations by breaking with the Axis. Such remarks made so publicly by a man reputed to have high official connections caused much indignant comment in Washington, especially among members of the staffs of those agencies engaged in promoting friendly relations with our neighbors to the South. So, in a visit to the State Department, I asked several questions of one member of the staff who appeared to be informed: "Did the State Department know that McClintock intended to make those remarks about Chile?" "No," was the reply. "Did the State Department approve of them. after they were delivered?" "No," was the reply. "What did the State Department do about it?" "We told McClintock we did not approve of it," was the reply. "What else did the State Department do about it?" "Nothing," was the reply. Mr. McClintock, vice-president and director of Sterling, subject to the continued approval by the United States Government, continued to hold his job. And Edward J. Noble, former director of Drug, Inc., who bad made that broadcasting possible, recently had purchased station WMCA (with the reputed assistance of Tommy Corcoran); also subject to the approval of a Government agency, the Federal Communications Commission, the very Commission which for several years had declined all suggestions that Farben's influence over broadcasting chains required investigation and action. Attorney General Biddle was heard later to complain to Congress that he had a headache because that body had not defined more accurately the meaning of the word "subversive." Examination of the McClintock broadcast and of the conditions existing when it was delivered, along with a glance through various statutes relating to such matters, might have afforded the Attorney General greater relief from his official headache than could a trunkful of Sterling's Bayer aspirin. The best cure for headache is to eradicate the cause. Possibly there is no better illustration of official hush-hush policy than the war-time reluctance of the State Department to reveal voluminous reports in its possession regarding the activities of I. G. Farben and the latter's agents in various parts of the world, especially those in North and South America. This reluctance to mention Farben as a factor in Germany's domestic and foreign activities was apparent in the State Department's 1943 Red Book on Peace and War which disclosed Germany's step-by-step rearming; and in its 1943 White Book on National Socialism which revealed details of the Nazis' domestic and foreign organizations. In neither of these publications was the name Farben, or of Farben's leaders and allies, even mentioned. The files of the State Department, it is reported, tell a different story. It may not be fair to refer to our State Department as Sees All, Knows All, and Does Nothing, but the unhappy fact remains that in the record of Secretary Hull's staff there appeared few if any public statements on the subject of Farben. However, the State Department did respond with one opinion regarding the distribution and advertising of such patent medicines as Castoria in Latin America. Advertising Castoria in leading Latin American papers as the laxative which "is meant for children," containing "no substance which harms," good neighbor Sterling had been begging the mothers of those babies never to make the "Serious mistake" of giving their children any laxative but Castoria. One Bernard Meltzer, State Department Acting Chief of Foreign Funds Control, advised that investigation of such matters could not be undertaken, and that: Neither the (State) Department nor any other agency of this Government has taken any measures which may be construed as approving all . . . activities, including advertising, of Sterling Products, Inc. Which pronouncement appears to be a somewhat comprehensive denial of responsibility for matters which related to our wartime good-neighbor policy, as well as for one of the conditions of the 1941 Sterling consent decrees. pps. 254-268 ----- Aloha, He'Ping, Om, Shalom, Salaam. Em Hotep, Peace Be, All My Relations. Omnia Bona Bonis, Adieu, Adios, Aloha. Amen. Roads End <A HREF="http://www.ctrl.org/">www.ctrl.org</A> DECLARATION & DISCLAIMER ========== CTRL is a discussion & informational exchange list. Proselytizing propagandic screeds are not allowed. Substance—not soap-boxing! 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