CHAPTER SEVEN - The Hitler Connection

J. Henry Schroder Banking Company is listed as Number 2 in capitalization in Capital City ⁶² on the list of the seventeen merchant bankers who make up the exclusive Accepting Houses Committee in London. Although it is almost unknown in the United States, it has played a large part in our history. Like the others on this list, it had first to be approved by the Bank of England.

And, like the Warburg family, the von Schroders began their banking operations in Hamburg, Germany. At the turn of the century, in 1900, Baron Bruno von Schroder established the London branch of the firm. He was soon joined by Frank Cyril Tiarks, in 1902. Tiarks married Emma Franziska of Hamburg, and was a director of the Bank of England from 1912 to 1945.

During World War I, J. Henry Schroder Banking Company played an important role behind the scenes. No historian has a reasonable explanation of how World War I started. Archduke Ferdinand was assassinated at Sarajevo by Gavril Princeps, Austria demanded an apology from Serbia, and Serbia sent the note of apology. Despite this, Austria declared war, and soon the other nations of Europe joined the fray. Once the war had gotten started, it was found that it wasn’t easy to keep it going. The principal problem was that Germany was desperately short of food and coal, and without Germany, the war could not go on.

John Hamill in The Strange Career of Mr. Hoover ⁶³ explains how the problem was solved.* He quotes from Nordeutsche Allgemeine Zeitung, March 4, 1915,

"Justice, however, demands that publicity should be given to the preeminent part taken by the German authorities in Belgium in the solution of this problem. The initiative came from them and it was only due to their continuous relations with the American Relief Committee that the provisioning question was solved."

 

Hamill points out "That is what the Belgian Relief Committee was organized for--to keep Germany in food."

62 McRae and Cairncross, Capital City, Eyre Methuen, London, 1963
63 John Hamill, The Strange Career of Mr. Hoover, William Faro, New York, 1931

* Copies of Hamill’s book were systematically located and destroyed by government agents, because it was published on the eve of President Hoover’s re-election campaign.

The Belgian Relief Commission was organized by Emile Francqui, director of a large Belgian bank, Societe Generale, and a London mining promoter, an American named Herbert Hoover, who had been associated with Francqui in a number of scandals which had become celebrated court cases, notably the Kaiping Coal Company scandal in China, said to have set off the Boxer Rebellion, which had as its goal the expulsion of all foreign businessmen from China. Hoover had been barred from dealing on the London Stock Exchange because of one judgment against him, and his associate, Stanley Rowe, had been sent to prison for ten years. With this background, Hoover was called an ideal choice for a career in humanitarian work.

Although his name is unknown in the United States, Emile Francqui was the guiding spirit behind Herbert Hoover’s rise to fortune. Hamill (on page 156) identifies Francqui as the director of many atrocities committed against natives in the Congo. "For every cartridge they spent, they had to bring in a man’s hand". Francqui’s frightful record may have been the source for the charge later leveled against German soldiers in Belgium, that they chopped off the hands of women and children, a claim which proved to be groundless.

Hamill also says that Francqui,

"tricked the Americans out of the Hankow-Canton railroad concession in China in 1901, and at the same time had ‘stood by’ in case Hoover needed any further help in the ‘taking’ of the Kaiping coal mines. This is the humanitarian who had sole charge of the distribution of the Belgian ‘relief’ during the World War, for which Hoover did the buying and shipping. Francqui was a director with Hoover, in the Chinese Engineering and Mining Company (the Kaiping mines), through which Hoover transported 200,000 Chinese slave workers to the Congo to work Francqui’s copper mines."

Hamill says on page 311 that,

"Francqui opened the offices of the Belgian Relief in his bank, Societe Generale, as a one-man show, with a letter of permission from the German Governor General von der Goltz dated October 16, 1914.

The New York Herald Tribune of February 18, 1930, quoted by Congressman Louis McFadden in the House on February 26, 1930, said, "One of Belgium’s two directors on the Bank for International Settlements will be Emile Francqui of the Societe Generale, a member of both the Young and Dawes Plan Committees. The board of directors of the international bank will have no more colorful character than Emile Francqui, former Minister of Finance, veteran of the Congo and China... he is rated as the richest man in Belgium, and among the twelve richest men in Europe."

Despite his prominence, The New York Times Index mentions Francqui only a few times during two decades before his death. On October 3, 1931, The New York Times quoted Le Peuple of Brussels that Francqui would visit the United States.

"As a friend of President Hoover, Monsieur Francqui will not fail to pay a visit to the President."

On October 30, 1931, The New York Times reported this visit with the headline,

"Hoover-Francqui Talk was Unofficial".

 

"It was stated that Mr. Francqui spent Tuesday night as a personal guest of the President, and that they talked of world financial problems in general, strictly unofficial. Mr. Francqui was an associate of President Hoover during the latters ministrations in Belgium during the war. Their visit had no official significance. Mr. Francqui is a private citizen and not engaged in any official mission."

No reference is made to the Hoover-Francqui business associations which were the subject of huge lawsuits in London. The Francqui visit probably involved Hoover’s Moratorium on German War Debts, which stunned the financial world.

On December 15, 1931, Chairman McFadden informed the House of a dispatch in the Public Ledger of Philadelphia, October 24, 1931,

"GERMAN REVEALS HOOVER’S SECRET.

The American President was in intimate negotiations with the German government regarding a year’s debt holiday as early as December, 1930."

 

McFadden continued, "Behind the Hoover announcement there were many months of hurried and furtive preparations both in Germany and in Wall Street offices of German bankers. Germany, like a sponge, had to be saturated with American money. Mr. Hoover himself had to be elected, because this scheme began before he became President. If the German international bankers of Wall Street--that is Kuhn Loeb Company, J. & W. Seligman, Paul Warburg, J. Henry Schroder -- and their satellites had not had this job waiting to be done, Herbert Hoover would never have been elected President of the United States.

 

The election of Mr. Hoover to the Presidency was through the influence of the Warburg Brothers, directors of the great bank of Kuhn Loeb Company, who carried the cost of his election. In exchange for this collaboration Mr. Hoover promised to impose the moratorium of German debts. Hoover sought to exempt Kreuger’s loan to Germany of $125 million from the operation of the Hoover Moratorium. The nature of Kreuger’s swindle was known here in January when he visited his friend, Mr. Hoover, in the White House."

Not only did Hoover entertain Francqui in the White House, but also Ivar Kreuger, the most famous swindler of the twentieth century.

When Francqui died on November 13, 1935, The New York Times memorialized him as,

"the copper king of the Congo... Mr. Francqui, last year having gained dictatorial powers over the belga, maintained it on the gold standard during a crisis. In 1891 he led an expedition into the Congo and gained it for King Leopold. A man of great wealth, rated among the twelve richest men in Europe, he secured enormous copper deposits.

 

He was Minister of State in 1926 and Minister of Finance in 1934. It was his pride that he never accepted a centime of remuneration for his services to the government. While consul general at Shanghai, he secured valuable concessions, notably the Kaiping coal mines and the railway concession for the Tientsin Railroad. He was governor of the Societe Generale de Belgique, Lloyd Royal Belge, and regent of La Banque Nationale de Belgique."

The Times does not mention Francqui’s business partnerships with Hoover. Like Francqui, Hoover also refused remuneration for "government service", and as Secretary of Commerce and as President of the United States, he turned his salary back to the government.

On December 13, 1932, Chairman McFadden introduced a resolution of impeachment against President Hoover for high crimes and misdemeanors, which covers many pages, including violation of contracts, unlawful dissipation of the financial resources of the United States, and his appointment of Eugene Meyer to the Federal Reserve Board. The resolution was tabled and never acted upon by the House.

In criticizing Hoover’s Moratorium of German War Debts, McFadden had referred to Hoover’s "German" backers. Although all of the principals of "the London Connection" did originate in Germany, most of them in Frankfurt, at the time they sponsored Hoover’s candidacy for the Presidency of the United States, they were operating from London, as Hoover himself had done for most of his career.

Also, the Hoover Moratorium was not intended to "help" Germany, as Hoover had never been "pro-German". The Moratorium on Germany’s war debts was necessary so that Germany would have funds for rearming. In 1931, the truly forward-looking diplomats were anticipating the Second World War, and there could be no war without an "aggressor".

Hoover had also carried out a number of mining promotions in various parts of the world as a secret agent for the Rothschilds, and had been rewarded with a directorship in one of the principal Rothschild enterprises, the Rio Tinto Mines in Spain and Bolivia. Francqui and Hoover threw themselves into the seemingly impossible task of provisioning Germany during the First World War.

Their success was noted in Nordeutsche Allgemeine Zeitung, March 13, 1915, which noted that large quantities of food were now arriving from Belgium by rail. Schmoller’s Yearbook for Legislation, Administration and Political Economy for 1916, shows that one billion pounds of meat, one and a half billion pounds of potatoes, one and a half billion pounds of bread, and one hundred twenty-one millions pounds of butter had been shipped from Belgium to Germany in that year.

A patriotic British woman who had operated a small hospital in Belgium for several years, Edith Cavell, wrote to the Nursing Mirror in London, April 15, 1915, complaining that the "Belgian Relief" supplies were being shipped to Germany to feed the German army. The Germans considered Miss Cavell to be of no importance, and paid no attention to her, but the British Intelligence Service in London was appalled by Miss Cavell’s discovery, and demanded that the Germans arrest her as a spy.

Sir William Wiseman, head of British Intelligence, and partner of Kuhn Loeb Company, feared that the continuance of the war was at stake, and secretly notified the Germans that Miss Cavell must be executed. The Germans reluctantly arrested her and charged her with aiding prisoners of war to escape. The usual penalty for this offense was three months imprisonment, but the Germans bowed to Sir William Wiseman’s demands, and shot Edith Cavell, thus creating one of the principal martyrs of the First World War.

With Edith Cavell out of the way, the "Belgian Relief" operation continued, although in 1916, German emissaries again approached London officials with the information that they did not believe Germany could continue military operations, not only because of food shortages, but because of financial problems. More "emergency relief" was sent, and Germany continued in the war until November, 1918.

Two of Hoover’s principal assistants were a former lumber shipping clerk from the West Coast, Prentiss Gray, and Julius H. Barnes, a grain salesman from Duluth. Both men became partners in J. Henry Schroder Banking Corporation in New York after the war, and amassed large fortunes, principally in grain and sugar.

With the entry of the United States into the war, Barnes and Gray were given important posts in the newly created U.S. Food Administration, which also was placed under Herbert Hoover’s direction. Barnes became President of the Grain Corporation of the U.S. Food Administration from 1917 to 1918, and Gray was chief of Marine Transportation. Another J. Henry Schroder partner, G. A. Zabriskie, was named head of the U.S. Sugar Equalization Board.

Thus the London Connection controlled all food in the United States through its grain and sugar "Czars" during the First World War. Despite many complaints of corruption and scandal in the U.S. Food Administration, no one was ever indicted. After the war, the partners of J. Henry Schroder Company found that they now owned most of Cuba’s sugar industry.

One partner, M.E. Rionda, was president of Cuba Cane Corporation, and director of Manati Sugar Company, American British and Continental Corporation, and other firms. Baron Bruno von Schroder, senior partner of the firm, was a director of North British and Mercantile Insurance Company. His father, Baron Rudolph von Schroder of Hamburg, was a director of Sao Paulo Coffee Ltd., one of the largest Brazilian coffee companies, with F.C. Tiarks, also of the Schroder firm.*

* The New York Times noted on October 11, 1923: "Frank C. Tiarks, Governor of the Bank of England, will spend two weeks here to set up the opening of the banking house branch of J. Henry Schroder of London."

After the war, Zabriskie, who had been sugar Czar of the United States by presiding over the U.S. Sugar Equalization Board, became the president of several of the largest baking corporations in the United States: Empire Biscuit, Southern Baking Corporation, Columbia Baking, and other firms.

As his principal assistant in the U.S. Food Administration, Hoover chose Lewis Lichtenstein Strauss, who was soon to become a partner in Kuhn Loeb Company, marrying the daughter of Jerome Hanauer of Kuhn Loeb. Throughout his distinguished humanitarian service with the Belgian Relief Commission, the U.S. Food Administration, and, after the war, the American Relief Administration, Hoover’s closest associate was one Edgar Rickard, born in Pontgibaud, France.

In Who’s Who, he states that he was,

"World War administrative assistant to Herbert Hoover in all war and post-war organizations including the Commission For Relief in Belgium. He also served on the U.S. Food Administration from 1914-1924."

He remained one of Hoover’s closest friends, and usually the Rickards and Hoovers took their vacations together. After Hoover became Secretary of Commerce under Coolidge, Hamill tells us that Hoover awarded his friend the Hazeltine Radio patents, which paid him one million dollars a year in royalties.

In 1928, "the London Connection" decided to run Herbert Hoover for president of the United States. There was only one problem; although Herbert Hoover had been born in the United States, and was thus eligible for the office of the presidency, according to the Constitution, he had never had a business address or a home address in the United States, as he had gone abroad just after completing college at Stanford. The result was that during his campaign for the presidency, Herbert Hoover listed as his American address Suite 2000, 42 Broadway, New York, which was the office of Edgar Rickard. Suite 2000 was also shared by the grain tycoon and partner of J. Henry Schroder Banking Corporation, Julius H. Barnes.

After Herbert Hoover was elected president of the United States, he insisted on appointing one of the old London crowd, Eugene Meyer, as Governor of the Federal Reserve Board. Meyer’s father had been one of the partners of Lazard Freres of Paris, and Lazard Brothers of London. Meyer, with Baruch, had been one of the most powerful men in the United States during World War I, a member of the famous Triumvirate which exercised unequalled power; Meyer as Chairman of the War Finance Corporation, Bernard Baruch as Chairman of the War Industries Board, and Paul Warburg as Governor of the Federal Reserve System.

A longtime critic of Eugene Meyer, Chairman Louis McFadden of the House Banking and Currency Committee, was quoted in The New York Times, December 17, 1930, as having made a speech on the floor of the House attacking Hoover’s appointment of Meyer, and charging that,

"He represents the Rothschild interest and is liaison officer between the French Government and J.P. Morgan."

On December 18, The Times reported that "Herbert Hoover is deeply concerned" and that McFadden’s speech was "an unfortunate occurrence." On December 20, The Times commented on the editorial page, under the headline,

"McFadden Again"

 

"The speech ought to insure the Senate ratification of Mr. Meyer as head of the Federal Reserve. The speech was incoherent, as Mr. McFadden’s speeches usually are"

As The Times predicted, Meyer was duly approved by the Senate.

Not content with having a friend in the White House, J. Henry Schroder Corporation was soon embarked on further international adventures, nothing less than a plan to set up World War II. This was to be done by providing, at a crucial juncture, the financing for Adolf Hitler’s assumption of power in Germany. Although any number of magnates have been given credit for the financing of Hitler, including Fritz Thyssen, Henry Ford, and J.P. Morgan, they, as well as others, did provide millions of dollars for his political campaigns during the 1920s, just as they did for others who also had a chance of winning, but who disappeared and were never heard from again.

In December of 1932, it seemed inevitable to many observers of the German scene that Hitler was also ready for a toboggan slide into oblivion. Despite the fact that he had done well in national campaigns, he had spent all the money from his usual sources and now faced heavy debts.

In his book Aggression, Otto Lehmann-Russbeldt tells us that,

"Hitler was invited to a meeting at the Schroder Bank in Berlin on January 4, 1933. The leading industrialists and bankers of Germany tided Hitler over his financial difficulties and enabled him to meet the enormous debt he had incurred in connection with the maintenance of his private army. In return, he promised to break the power of the trade unions. On May 2, 1933, he fulfilled his promise." ⁶⁴

64 Otto Lehmann-Russbeldt, Aggression, Hutchinson & Co., Ltd., London, 1934, p. 44

Present at the January 4, 1933 meeting were the Dulles brothers, John Foster Dulles and Allen W. Dulles of the New York law firm, Sullivan and Cromwell, which represented the Schroder Bank.

The Dulles brothers often turned up at important meetings. They had represented the United States at the Paris Peace Conference (1919); John Foster Dulles would die in harness as Eisenhower’s Secretary of State, while Allen Dulles headed the Central Intelligence Agency for many years. Their apologists have seldom attempted to defend the Dulles brothers appearance at the meeting which installed Hitler as the Chancellor of Germany, preferring to pretend that it never happened.

Obliquely, one biographer Leonard Mosley, bypasses it in Dulles when he states,

"Both brothers had spent large amounts of time in Germany, where Sullivan and Cromwell had considerable interest during the early 1930’s, having represented several provincial governments, some large industrial combines, a number of big American companies with interests in the Reich, and some rich individuals." ⁶⁵

Allen Dulles later became a director of J. Henry Schroder Company. Neither he nor J. Henry Schroder were to be suspected of being pro-Nazi or pro-Hitler; the inescapable fact was that if Hitler did not become Chancellor of Germany, there was little likelihood of getting a Second World War going, the war which would double their profits.*

The Great Soviet Encyclopaedia states,

"The banking house Schroder Bros. (it was Hitler’s banker) was established in 1846; its partners today are the barons von Schroeder, related to branches in the United States and England." 66 **

65 Leonard Mosley, Dulles, Dial Publishing Co., New York 1978, p. 88
66 The Great Soviet Encyclopaedia, Macmillan, London, 1973, v.2, p. 620

* Ezra Pound, in an April 18, 1943 broadcast over Radio Rome stated, ". . .and men in America, not content with this war are already aiming at the next one. The time to object is now."

** The New York Times noted on October 11, 1944: "Senator Claude Pepper criticized John Foster Dulles, Gov. Dewey’s foreign relations advisor for his connection with the law firm of Sullivan and Cromwell and having aided Hitler financially in 1933. Pepper described the January 4, 1933 meeting of Franz von Papen and Hitler in Baron Schroder’s home in Cologne, and from that time on the Nazis were able to continue their march to power."
 

The financial editor of "The Daily Herald" of London wrote on Sept. 30, 1933 of

"Mr. Norman’s decision to give the Nazis the backing of the Bank (of England.)"

John Hargrave, in his biography of Montagu Norman says,

"It is quite certain that Norman did all he could to assist Hitlerism to gain and maintain political power, operating on the financial plane from his stronghold in Threadneedle Street."

[i.e. Bank of England.--Ed.]

Baron Wilhelm de Ropp, a journalist whose closest friend was Major F.W. Winterbotham, chief of Air Intelligence of the British Secret Service, brought the Nazi philosopher, Alfred Rosenberg, to London and introduced him to Lord Hailsham, Secretary for War, Geoffrey Dawson, editor of The Times, and Norman, Governor of the Bank of England. After talking with Norman, Rosenberg met with the representative of the Schroder Bank of London.

The managing director of the Schroder Bank, F.C. Tiarks, was also a director of the Bank of England. Hargrave says (p. 217),

"Early in 1934 a select group of City financiers gathered in Norman’s room behind the windowless walls, Sir Robert Kindersley, partner of Lazard Brothers, Charles Hambro, F.C. Tiarks, Sir Josiah Stamp, (also a director of the Bank of England). Governor Norman spoke of the political situation in Europe. A new power had established itself, a great ‘stabilizing force’, namely, Nazi Germany. Norman advised his co-workers to include Hitler in their plans for financing Europe. There was no opposition."

In Wall Street and the Rise of Hitler, Antony C. Sutton writes,

"The Nazi Baron Kurt von Schroeder acted as the conduit for I.T.T. money funneled to Heinrich Himmler’s S.S. organization in 1944, while World War II was in progress, and the United States was at war with Germany." 67

Kurt von Schroeder, born in 1889, was partner in the Cologne Bankhaus, J.H. Stein & Co., which had been founded in 1788. After the Nazis gained power in 1933, Schroeder was appointed the German representative at the Bank of International Settlements. The Kilgore Committee in 1940 stated that Schroeder’s influence with the Hitler Administration was so great that he had Pierre Laval appointed head of the French Government during the Nazi Occupation.

The Kilgore Committee listed more than a dozen important titles held by Kurt von Schroeder in the 1940’s, including,

• President of Deutsche Reichsbahn

• Reich Board of Economic Affairs

• SS Senior Group Leader

• Council of Reich Post Office

• Deutsche Reichsbank

• other leading banks and industrial groups

Schroeder served on the board of all International Telephone and Telegraph subsidiaries in Germany.

In 1938, the London Schroder Bank became the German financial agent in Great Britain. The New York branch of Schroder had been merged in 1936 with the Rockefellers, as Schroder, Rockefeller, Inc. at 48 Wall Street. Carlton P. Fuller of Schroder was president of this firm, and Avery Rockefeller was vice-president. He had been a behind the scenes partner of J. Henry Schroder for years, and had set up the construction firm of Bechtel Corporation, whose employees (on leave) now play a leading role in the Reagan Administration, as Secretary of Defense and Secretary of State.

Ladislas Farago, in The Game of the Foxes, 68 reported that Baron William de Ropp, a double agent, had penetrated the highest echelons in pre-World War II days, and Hitler relied upon de Ropp as his confidential consultant about British affairs. It was de Ropp’s advice which Hitler followed when he refused to invade England.
 

67 Antony C. Sutton, WALL STREET AND THE RISE OF HITLER, 76 Press, Seal Beach, California, 1976, p. 79
68 Ladislas Farago, The Game of the Foxes, 1973
 

Victor Perlo writes, in The Empire of High Finance:

"The Hitler government made the London Schroder Bank their financial agent in Britain and America. Hitler’s personal banking account was with J.M. Stein Bankhaus, the German subsidiary of the Schroder Bank. F.C. Tiarks of the British J. Henry Schroder Company was a member of the Anglo-German Fellowship with two other partners as members, and a corporate membership." 69

69 Victor Perlo, The Empire of High Finance, International Publishers, 1957, p. 177
 

The story goes much further than Perlo suspects. J. Henry Schroder WAS the Anglo-German Fellowship, the English equivalent of the America First movement, and also attracting patriots who did not wish to see their nation involved in a needless war with Germany. During the 1930’s, until the outbreak of World War II, the Schroders poured money into the Anglo-German Fellowship, with the result that Hitler was convinced he had a large pro-German fifth column in England composed of many prominent politicians and financiers.

The two divergent political groups in the 1930’s in England were the War Party, led by Winston Churchill, who furiously demanded that England go to war against Germany, and the Appeasement Party, led by Neville Chamberlain. After Munich, Hitler believed the Chamberlain group to be the dominant party in England, and Churchill a minor rabble-rouser.

Because of his own financial backers, the Schroders, were sponsoring the Appeasement Party, Hitler believed there would be no war. He did not suspect that the backers of the Appeasement Party, now that Chamberlain had served his purpose in duping Hitler, would cast Chamberlain aside and make Churchill the Prime Minister. It was not only Chamberlain, but also Hitler, who came away from Munich believing that it would be "Peace in our time."

The success of the Schroders in duping Hitler into this belief explains several of the most puzzling questions of World War II. Why did Hitler allow the British Army to decamp from Dunkirk and return home, when he could have wiped them out? Against the frantic advice of his generals, who wished to deliver the coup de grace to the English Army, Hitler held back because he did not wish to alienate his supposed vast following in England. For the same reason, he refused to invade England during a period when he had military superiority, believing that it would not be necessary, as the Anglo-German Fellowship group was ready to make peace with him.

The Rudolf Hess flight to England was an attempt to confirm that the Schroder group was ready to make peace and form a common bond against the Soviets. Rudolf Hess continues to languish in prison today, many years after the war, because he would, if released, testify that he had gone to England to contact the members of the Anglo-German Fellowship, that is, the Schroder group, about ending the war.*

* The following accounts are from The New York Times:

October 21, 1945,

"A broadcast over the Luxembourg radio said tonight that Baron Kurt von Schroder, former banker who helped finance the rise of the Nazi party, had been recognized in an American prison camp and arrested."

November 1, 1945,

"British Army Headquarters: Baron Kurt von Schroder, 55 year old banker and friend of Heinrich Himmler is being held in Dusseldorf pending decision on his indictment as a war criminal, the Military Government official announcement said today."

February 29, 1948,

"An immediate investigation was demanded yesterday by the Society for the Prevention of World War III as to why the German Nazi banker, Kurt von Schroder, was not tried as a war criminal by an allied military tribunal. Noting that von Schroder was sentenced last November to three months imprisonment and fined 1500 Reichsmarks by a German denazification court in Bielefeld, in the British Zone, C. Monteith Gilpin, secretary for the society said the question should be asked why von Schroder was allowed to escape allied justice, and why our own officials have not demanded that von Schroder be tried by an Allied military tribunal. ‘Von Schroder is as guilty as Hitler or Goering.’"

If anyone supposes this is all ancient history, with no application to the present political scene, we introduce the name of John Lowery Simpson of Sacramento, California. Although he appears for the first time in Who’s Who in America for 1952, Mr. Simpson states that he served under Herbert Hoover on the Commission for Relief in Belgium from 1915 to 1917; U.S. Food Administration, 1917 to 1918, American Relief Commission, 1919, and with P.N. Gray Company, Vienna, 1919 to 1921.

Gray was the Chief of Maritime Transportation for the U.S. Food Administration, which enabled him to set up his own shipping company after the war. Like other Hoover humanitarians, Simpson also joined the J. Henry Schroder Banking Company (Adolf Hitler’s personal bankers) and the J. Henry Schroder Trust Company. He also became a partner of Schroder-Rockefeller Company when that investment trust backed a construction company which became the world’s largest, the firm of Bechtel Incorporated. Simpson was chairman of the finance committee of Bechtel Company, Bechtel International, and Canadian Bechtel.

Simpson states he was consultant to the Bechtel-McCone interests in war production during World War II. He served on the Allied Control Commission in Italy 1943-44. He married Margaret Mandell, of the merchant family for whom Col. Edward Mandell House was named, and he backed a California personality, first for Governor, then for President.

As a result, Simpson and J. Henry Schroder Company now have serving them as Secretary of Defense, former Bechtel employee Caspar Weinberger. As Secretary of State they have serving them George Pratt Schultz, also a Bechtel employee, who happens to be a Standard Oil heir, reaffirming the Schroder-Rockefeller company ties.

Thus the "conservative" Reagan Administration has,

• a Secretary of Defense from Schroder Company

• a Secretary of State from Schroder-Rockefeller

• a vice president whose father was senior partner of Brown Brothers Harriman

The Heritage Foundation has also been an important factor in the policy-making of the Reagan Administration. Now we find that the Heritage Foundation is part of the Tavistock Institute network, directed by British Intelligence. The financial decisions are still made at the Bank of England, and who is head of the Bank of England? Sir Gordon Richardson, chairman of J. Henry Schroder Co. of London and New York from 1962 to 1972, when he became Governor of the Bank of England. The "London Connection" has never been more firmly in the saddle of the United States Government.

On July 3, 1983, The New York Times announced that Gordon Richardson, Governor of the Bank of England for the past ten years, had been replaced by Robert Leigh-Pemberton, Chairman of the National Westminster Bank. The list of directors of National Westminster Bank reads like a Who’s Who of the British ruling class.

They include,

• the Chairman, Lord Aldenham, who is also Chairman of Antony Gibbs & Son, merchant bankers, one of the seventeen privileged firms chartered by the Bank of England

• Sir Walter Barrie, Chairman of the British Broadcasting System

• F.E. Harmer, Governor of the London School of Economics, the training school for the international bankers, and chairman of New Zealand Shipping Company

• Sir E.C. Mieville, private secretary to the King of England 1937-45

• Marquess of Salisbury, Lord Cecil, Lord Privy Seal (the Cecils have been considered one of England’s three ruling families since the Middle Ages)

• Lord Leathers, Baron of Purfleet, Minister of War Transport 1941-45, chairman of William Cory group of companies

• Sir W.H. Coates and W.J. Worboys of Imperial Chemical Industries (the English DuPont)

• Earl of Dudley, chairman British Iron & Steel, Sir W. Benton Jones, chairman United Steel and many other steel companies

• Sir G.E. Schuster, Bank of New Zealand; East India Coal Company

• A. d’A. Willis, Ashanti Goldfields and many banks, tea companies and other firms

• V.W. Yorke, chairman of Mexican Railways Ltd

Richardson, former chairman of Schroders with a New York subsidiary holding Federal Reserve Bank of New York stock, was replaced by the chairman of National Westminster, with a subsidiary in New York holding Federal Reserve Bank of New York stock.

Robert Leigh Pemberton, a director of Equitable Life Assurance Society (J.P. Morgan), married the daughter of the Marchioness of Exeter, (the Cecil Burghley family). Thereby, the control of the London Connection remains constantly in effect.

The list of the present directors of J. Henry Schroder Bank and Trust shows the continuing international influence since the First World War.

• George A. Braga is also director of Czarnikow-Rionda Company, vice-president of Francisco Sugar Company, president of Manati Sugar Company, and vice-president of New Tuinicui Sugar Company.

• His relative, Rionda B. Braga, is president of Francisco Sugar Company and vice-president of Manati Sugar Company.

• The Schroder control of sugar goes back to the U.S. Food Administration under Herbert Hoover and Lewis L. Strauss of Kuhn, Loeb, Company during World War I.

• Schroder’s attorneys are the firm of Sullivan and Cromwell.

• John Foster Dulles of this firm was present during the historic agreement to finance Hitler, and was later Secretary of State in the Eisenhower administration.

• Alfred Jaretzki, Jr., of Sullivan and Cromwell is also a director of Manati Sugar Company and Francisco Sugar Company.

• Another director of J. Henry Schroder is Norris Darrell, Jr., born in Berlin, Germany, partner of Sullivan and Cromwell, and a director of Schroder Trust Company.

• Bayless Manning, partner of the Wall Street law firm of Paul, Weiss, Rifkind and Wharton, is also a director of J. Henry Schroder. He was president of the Council on Foreign Relations from 1971-1977, and is editor in chief of the Yale Law Review.

• Paul H. Nitze, the prominent "disarmament negotiator" for the United States government, is a director of Schroder’s Inc. He married Phyllis Pratt, of the Standard Oil fortune, whose father gave the Pratt family mansion as the building which houses the Council on Foreign Relations.

Go Back

CHAPTER EIGHT - World War One

"Money is the worst of all contraband."

--William Jennings Bryan

It is now apparent that there might have been no World War without the Federal Reserve System. A strange sequence of events, none of which were accidental, had occurred. Without Theodore Roosevelt’s "Bull Moose" candidacy, the popular President Taft would have been reelected, and Woodrow Wilson would have returned to obscurity.*

If Wilson had not been elected, we might have had no Federal Reserve Act, and World War One could have been avoided. The European nations had been led to maintain large standing armies as the policy of the central banks which dictated their governmental decisions.

In April, 1887, the Quarterly Journal of Economics had pointed out:

"A detailed revue of the public debts of Europe shows interest and sinking fund payments of $5,343 million annually (five and one-third billion). M. Neymarck’s conclusion is much like Mr. Atkinson’s. The finances of Europe are so involved that the governments may ask whether war, with all its terrible chances, is not preferable to the maintenance of such a precarious and costly peace. If the military preparations of Europe do not end in war, they may well end in the bankruptcy of the States. Or, if such follies lead neither to war nor to ruin, then they assuredly point to industrial and economic revolution."

* NOTE: P.34. "House revealed to me in a confidential moment, ‘Wilson was elected by Teddy Roosevelt.’" The Strangest Friendship in History, Woodrow Wilson and Col. House, George Sylvester Viereck, Liveright, N.Y. 1932

From 1887 to 1914, this precarious system of heavily armed but bankrupt European nations endured, while the United States continued to be a debtor nation, borrowing money from abroad, but making few international loans, because we did not have a central bank or "mobilization of credit".

The system of national loans developed by the Rothschilds served to finance European struggles during the nineteenth century, because they were spread out over Rothschild branches in several countries. By 1900, it was obvious that the European countries could not afford a major war. They had large standing armies, universal military service, and modern weapons, but their economies could not support the enormous expenditures.

The Federal Reserve System began operations in 1914, forcing the American people to lend the Allies twenty-five billion dollars which was not repaid, although considerable interest was paid to New York bankers. The American people were driven to make war on the German people, with whom we had no conceivable political or economic quarrel. Moreover, the United States comprised the largest nation in the world composed of Germans; almost half of its citizens were of German descent, and by a narrow margin, German had been voted down as the national language.*

* 1787 Constitutional Convention

The German Ambassador to Turkey, baron Wangeheim asked the American Ambassador to Turkey, Henry Morgenthau, why the United States intended to make war in Germany. "We Americans," replied Morgenthau, speaking for the group of Harlem real estate operators of which he was the head, "are going to war for a moral principle."

J.P. Morgan received the proceeds of the First Liberty Loan to pay off $400,000,000 which he advanced to Great Britain at the outset of the war. To cover this loan, $68,000,000 in notes had been issued under the provisions of the Aldrich-Vreeland Act for issuing notes against securities, the only time this provision was employed.

The notes were retired as soon as the Federal Reserve Banks began operation, and replaced by Federal Reserve Notes.

During 1915 and 1916, Wilson kept faith with the bankers who had purchased the White House for him, by continuing to make loans to the Allies. His Secretary of State, William Jennings Bryan, protested constantly, stating that "Money is the worst of all contraband."

By 1917, the Morgans and Kuhn, Loeb Company had floated a billion and a half dollars in loans to the Allies. The bankers also financed a host of "peace" organizations which worked to get us involved in the World War. The Commission for Relief in Belgium manufactured atrocity stories against the Germans, while a Carnegie organization, The League to Enforce Peace, agitated in Washington for our entry into war. This later became the Carnegie Endowment for International Peace, which during the 1940s was headed by Alger Hiss.

One writer * claimed that he had never seen any "peace movement" which did not end in war.

* NOTE: Emmett Tyrell, Jr., Richmond Times Dispatch, Feb. 15, 1983 "Every peace movement of this century has been followed by war."

The U.S. Ambassador to Britain, Walter Hines Page, complained that he could not afford the position, and was given twenty-five thousand dollars a year spending money by Cleveland H. Dodge, president of the National City Bank. H.L. Mencken openly accused Page in 1916 of being a British agent, which was unfair. Page was merely a bankers’ agent.

On March 5, 1917, Page sent a confidential letter to Wilson.

"I think that the pressure of this approaching crisis has gone beyond the ability of the Morgan Financial Agency for the British and French Governments... The greatest help we could give the Allies would be a credit. Unless we go to war with Germany, our Government, of course, cannot make such a direct grant of credit."

The Rothschilds were wary of Germany’s ability to continue in the war, despite the financial chaos caused by their agents, the Warburgs, who were financing the Kaiser, and Paul Warburg’s brother, Max, who, as head of the German Secret Service, authorized Lenin’s train to pass through the lines and execute the Bolshevik Revolution in Russia.

According to Under Secretary of the Navy, Franklin D. Roosevelt, America’s heavy industry had been preparing for war for a year. Both the Army and Navy Departments had been purchasing war supplies in large amounts since early in 1916.

Cordell Hull remarks in his Memoirs:

"The conflict forced the further development of the income-tax principle. Aiming, as it did, at the one great untaxed source of revenue, the income-tax law had been enacted in the nick of time to meet the demands of the war. And the conflict also assisted the putting into effect of the Federal Reserve System, likewise in the nick of time." ⁷⁰

70 Cordell Hull, Memoirs, Macmillan, New York, 1948, v. 1, page 76
 

One may ask, in the nick of time for whom? Certainly not for the American people, who had no need for "mobilization of credit" for a European war, or to enact an income tax to finance a war. Hull’s statement affords a rare glimpse into the machinations of our "public servants".

The Notes of the Journal of Political Economy, October, 1917, state:

"The effect of the war upon the business of the Federal Reserve Banks has required an immense development of the staffs of these banks, with a corresponding increase in expenses. Without, of course, being able to anticipate so early and extensive a demand for their services in this connection, the framers of the Federal Reserve Act had provided that the Federal Reserve Banks should act as fiscal agents of the Government."

The bankers had been waiting since 1887 for the United States to enact a central bank plan so that they could finance a European war among the nations whom they had already bankrupted with armament and "defense" programs. The most demanding function of the central bank mechanism is war finance.

On October 13, 1917, Woodrow Wilson made a major address, stating:

"It is manifestly imperative that there should be a complete mobilization of the banking reserves of the United States. The burden and the privilege (of the Allied loans) must be shared by every banking institution in the country. I believe that cooperation on the part of the banks is a patriotic duty at this time, and that membership in the Federal Reserve System is a distinct and significant evidence of patriotism."

E.W. Kemmerer writes that,

"As fiscal agents of the Government, the federal reserve banks rendered the nations services of incalculable value after our entrance into the war. They aided greatly in the conservation of our gold resources, in the regulation of our foreign exchanges, and in the centralization of our financial energies. One shudders when he thinks what might have happened if the war had found us with our former decentralized and antiquated banking system."

Mr. Kemmerer’s shudders ignore the fact that if we had kept "our antiquated banking system" we would not have been able to finance the World War or to enter as a participant ourselves.

Woodrow Wilson himself did not believe in his crusade to save the world for democracy. He later wrote that "The World War was a matter of economic rivalry."

On being questioned by Senator McCumber about the circumstances of our entry into the war, Wilson was asked,

"Do you think if Germany had committed no act of war or no act of injustice against our citizens that we would have gotten into this war?"

"I do think so," Wilson replied.

"You think we would have gotten in anyway?" pursued McCumber.

"I do," said Wilson.

In Wilson’s War Message in 1917, he included an incredible tribute to the Communists in Russia who were busily slaughtering the middle class in that unfortunate country.

"Assurance has been added to our hope for the future peace of the world by the wonderful and heartening things that have been happening in the last few weeks in Russia. Here is a fit partner for a League of Honor." 71

71 Public Papers of Woodrow Wilson, Dodd & Baker, v.5, p. 12-13

Wilson’s (image right) paean to a bloodthirsty regime which has since murdered sixty-six million of its inhabitants in the most barbarous manner exposes his true sympathies and his true backers, the bankers who had financed the blood purge in Russia. When the Communist Revolution seemed in doubt, Wilson sent his personal emissary, Elihu Root, to Russia with one hundred million dollars from his Special Emergency War Fund to save the toppling Bolshevik regime.

The documentation of Kuhn, Loeb Company’s involvement in the establishment of Communism in Russia is much too extensive to be quoted here, but we include one brief mention, typical of the literature on this subject.

In his book, Czarism and the Revolution, Gen. Arsene de Goulevitch writes,

"Mr. Bakmetiev, the late Russian Imperial Ambassador to the United States, tells us that the Bolsheviks, after victory, transferred 600 million roubles in gold between the years 1918-1922 to Kuhn, Loeb Company."

After our entry into World War I, Woodrow Wilson turned the government of the United States over to a triumvirate of his campaign backers, Paul Warburg, Bernard Baruch and Eugene Meyer.

• Baruch was appointed head of the War Industries Board, with life and death powers over every factory in the United States

• Eugene Meyer was appointed head of the War Finance Corporation, in charge of the loan program which financed the war

• Paul Warburg was in control of the nation’s banking system *

* NOTE: New York Times, August 10, 1918; "Mr. (Paul) Warburg was the author of the plan organizing the War Finance Corporation."

Knowing that the overwhelming sentiment of the American people during 1915 and 1916 had been anti-British and pro-German, our British allies viewed with some trepidation the prominence of Paul Warburg and Kuhn, Loeb Company in the prosecution of the war. They were uneasy about his high position in the Administration because his brother, Max Warburg, was at that time serving as head of the German Secret Service.

On December 12, 1918, the United States Naval Secret Service Report on Mr. Warburg was as follows:

"WARBURG, PAUL: New York City. German, naturalized citizen, 1911. was decorated by the Kaiser in 1912, was vice chairman of the Federal Reserve Board. Handled large sums furnished by Germany for Lenin and Trotsky. Has a brother who is leader of the espionage system of Germany."

Strangely enough, this report, which must have been compiled much earlier, while we were at war with Germany, is not dated until December 12, 1918, AFTER the Armistice had been signed. Also, it does not contain the information that Paul Warburg resigned from the Federal Reserve Board in May, 1918, which indicates that it was compiled before May, 1918, when Paul Warburg would theoretically have been open to a charge of treason because of his brother’s control of Germany’s Secret Service.

Paul Warburg’s brother Felix in New York was a director of the Prussian Life Insurance Company of Berlin, and presumably would not have liked to see too many of his policyholders killed in the war.

On September 26, 1920, The New York Times mentioned in its obituary of Jacob Schiff in reference to Kuhn, Loeb and Company,

"During the world War certain of its members were in constant contact with the Government in an advisory capacity. It shared in the conferences which were held regarding the organization and formation of the Federal Reserve System."

The 1920 Schiff obituary revealed for the first time that Jacob Schiff, like the Warburgs, also had two brothers in Germany during World War I, Philip and Ludwig Schiff, of Frankfurt-on-Main, who also were active as bankers to the German Government!

This was not a circumstance to be taken lightly, as on neither side of the Atlantic were the said bankers obscure individuals who had no influence in the conduct of the war. On the contrary, the Kuhn, Loeb partners held the highest governmental posts in the United States during World War I, while in Germany, Max and Fritz Warburg, and Philip and Ludwig Schiff, moved in the highest councils of government.

From Memoirs of Max Warburg,

"The Kaiser thumbed the table violently and shouted, ‘Must you always be right?’ but then listened carefully to Max’s view on financial matters." ⁷²

In June, 1918, Paul Warburg wrote a private note to Woodrow Wilson,

"I have two brothers in Germany who are bankers. They naturally now serve their country to their utmost ability, as I serve mine." ⁷³

Neither Wilson nor Warburg viewed the situation as one of concern, and Paul Warburg served out his term on the Federal Reserve Board of Governors, while World War I continued to rage.

The background of Kuhn, Loeb & Company had been exposed in "Truth Magazine", edited by George Conroy:

"Mr. Schiff is head of the great private banking house of Kuhn, Loeb & Co. which represents the Rothschild interest on this side of the Atlantic. He has been described as a financial strategist and has been for years the financial minister to the great impersonal power known as Standard Oil. He was hand-in-glove with the Harrimans, the Goulds and the Rockefellers, in all their railroad enterprises and has become the dominant power in the railroad and financial world in America.

Louis Brandeis, because of his great ability as a lawyer and for other reasons which will appear later, was selected by Schiff as the instrument through which Schiff hoped to achieve his ambition in New England. His job was to carry on an agitation which would undermine public confidence in the New Haven system and cause a decrease in the price of its securities, thus forcing them on the market for the wreckers to buy." ⁷⁴

72 Max Warburg, Memoirs of Max Warburg, Berlin, 1936
73 David Farrar, The Warburgs, Michael Joseph, Ltd., London, 1974
74 "Truth Magazine", George Conroy, editor, Boston, issue of December 16, 1912

We mention Schiff’s lawyer, Brandeis, here because the first available appointment on the Supreme Court of the United States which Woodrow Wilson was allowed to fill was given to the Kuhn, Loeb lawyer, Brandeis.

Not only was the U.S. Food Administration managed by Hoover’s director, Lewis Lichtenstein Strauss, who married into the Kuhn Loeb Company by marrying Alice Hanauer, daughter of partner Jerome Hanauer, but in the most critical field, military intelligence, Sir William Wiseman, chief of the British Secret Service, was a partner of Kuhn, Loeb & Company. He worked most closely with Wilson’s alter ego, Col. House.

"Between House and Wiseman there were soon to be few political secrets, and from their mutual comprehension resulted in large measure our close cooperation with the British." ⁷⁵

One example of House’s cooperation with Wiseman was a confidential agreement which House negotiated pledging the United States to enter into World War I on the side of the Allies. Ten months before the election which returned Wilson to the White House in 1916 ‘because he kept us out of war’, Col. House negotiated a secret agreement with England and France on behalf of Wilson which pledged the United States to intervene on behalf of the Allies.

On March 9, 1916, Wilson formally sanctioned the undertaking. ⁷⁶

75 Edward M. House, The Intimate Papers of Col. House, edited by Charles Seymour, Vol. II, p. 399. Houghton, Mifflin Co.
76 George Sylvester Viereck, The Strangest Friendship in History, Woodrow Wilson and Col. House, p. 106
 

Nothing could more forcefully illustrate the duplicity of Woodrow Wilson’s nature than his nationwide campaign on the slogan, "He kept us out of war", when he had pledged ten months earlier to involve us in the war on the side of England and France. This explains why he was regarded with such contempt by those who learned the facts of his career. H.L. Mencken wrote that Wilson was "the perfect model of the Christian cad", and that we ought "to dig up his bones and make dice of them."

According to The New York Times, Paul Warburg’s letter of resignation stated that some objection had been made because he had a brother in the Swiss Secret Service. The New York Times has never corrected this blatant falsehood, perhaps because Kuhn, Loeb Company owned a controlling interest in its stock. Max Warburg was not Swiss, and although he had probably come into contact with the Swiss Secret Service during his term of office as head of the German Secret Service, no responsible editor at The New York Times could have been unaware of the fact that Max Warburg was German, and that his family banking house was in Hamburg, and that he held a number of high positions in the German Government.

He represented Germany at the Versailles Peace Conference, and remained peacefully in Germany until 1939, during a period when persons of his religion were being persecuted. To avoid injury during the approaching war, when bombs would rain on Germany, Max Warburg was allowed to sail to New York, his funds intact.

At the outset of World War I, Kuhn, Loeb Company had figured in the transfer of German shipping interests to other control. Sir Cecil Spring-Rice, British Ambassador to the United States, in a letter to Lord Grey wrote:

"Another matter is the question of the transfer of the flag to the Hamburg Amerika ships. The company is practically a German Government affair. The ships are used for Government purposes, the Emperor himself is a large shareholder, and so is the great banking house of Kuhn, Loeb Company. A member of that house (Warburg) has been appointed to a very responsible position in New York, although only just naturalized. He is concerned in business with the Secretary of the Treasury, who is the President’s son-in-law. It is he who is negotiating on behalf of the Hamburg Amerika Shipping Company." ⁷⁷

On November 13, 1914, in a letter to Sir Valentine Chirol, Spring-Rice wrote, (p. 241, v. 2)

"I was told today that The New York Times has been practically acquired by Kuhn, Loeb and Schiff, special protégé of the (German) Emperor. Warburg, nearly related to Kuhn Loeb and Schiff is a brother of the well known Warburg of Hamburg, the associate of Ballin (Hamburg) Amerika line, is a member of the Federal Reserve Board or rather THE member. He practically controls the financial policy of the Administration, and Paish & Blackett (England) had mainly to negotiate with him. Of course, it was exactly like negotiating with Germany. Everything that was said was German property."

Col. Garrison wrote in Roosevelt, Wilson and the Federal Reserve Law, that,

"Through the banking House of the Kuhn Loeb Company, a powerful weapon would have been placed in the hands of the German Kaiser over the destiny of American business and American citizens." ⁷⁸

77 Letters and Friendships of Sir Cecil Spring-Rice, p. 219-220
78 Col. Elisha Garrison, Roosevelt, Wilson and the Federal Reserve Law, Christopher Publishing House, Boston, 1931, p. 260

Garrison was referring to the Hamburg Amerika affair.

It seemed strange that Woodrow Wilson felt it necessary to place the nation in the hands of three men whose personal history was one of ruthless speculation and the quest for personal gain, or that during war with Germany, he found as persons of supreme trust a German immigrant naturalized in 1911, the son of an immigrant from Poland, and the son of an immigrant from France. Bernard Baruch (image left) first attracted attention on Wall Street in 1890 while working for A.A. Housman & Co.

In 1896 he merged the six principal tobacco companies of the United States into the Consolidated Tobacco Company, forcing James Duke and the American Tobacco Trust to enter into this combination. The second great trust set up by Baruch brought the copper industry into the hands of the Guggenheim family, who have controlled it ever since.

Baruch worked with Edward H. Harriman, who was Schiff’s front man in controlling America’s railway system for the Rothschild family. Baruch and Harriman also combined their talents to gain control over the New York City transit system, which has been in perilous financial condition ever since.

In 1901, Baruch formed the firm of Baruch Brothers, bankers, with his brother Herman, in New York. In 1917, when Baruch was appointed Chairman of the War Industries Board, the name was changed to Hentz Brothers.

Testifying before the Nye Committee on September 13, 1937, Bernard Baruch stated that "All wars are economic in their origin." So much for religious and political disagreements, which had been specially touted as the cause of wars.*

* NOTE: Baruch also stated in this testimony, "I carried through the war three major investments, Alaska Juneau Gold Mining Company (with partner Eugene Meyer), Texas Gulf Sulphur, and Atolia Mining Company (tungsten)." Rep. Mason, Illinois, told the House on February 21, 1921 that Baruch made more than $50 million in copper during the war.

A profile in the "New Yorker" magazine reported that Baruch made a profit of seven hundred fifty thousand dollars in one day during World War I, after a phony peace rumor was planted in Washington. In "Who’s Who", Baruch mentions that he was a member of the Commission which handled all purchasing for the Allies during World War I. In fact, Baruch WAS the Commission.

He spent the American taxpayer’s money at the rate of ten billion dollars a year, and was also the dominant member of the Munitions Price-Fixing Committee. He set the prices at which the Government bought war materials. It would be naive to presume that the orders did not go to firms in which he and his associates had more than a polite interest dictator over American manufacturers.*

* Baruch chose as Assistant Chairman of the War Industries Board a fellow Wall Street speculator, Clarence Dillon (Lapowitz). See biographies.
 

At the Nye Committee hearings in 1935, Baruch testified,

"President Wilson gave me a letter authorizing me to take over any industry or plant. There was udge Gary, President of United States Steel, whom we were having trouble with, and when I showed him that letter, he said, ‘I guess we will have to fix this up’, and he did fix it up."

Some members of Congress were curious about Baruch’s qualifications to exercise life and death powers over American industry in time of war. He was not a manufacturer, and had never been in a factory. When he was called before a Congressional Committee, Bernard Baruch stated that his profession was "Speculator".

A Wall Street gambler had been made Czar of American Industry.

@insert Facsimile of New York Times article

Facsimile of an article which appeared in The New York Times dated September 23, 1914. Listed are major stockholders of the five New York City banks which purchased 40% of the 203, 053 shares of the Federal Reserve Bank of New York when the System was organized in 1914. They thus obtained control of that Federal Reserve Bank and have held it ever since.

As of Tuesday, July 26, 1983, the top five surviving New York City banks have increased their ownership of the Federal Reserve Bank of New York to 53% of the shares.

CHART I

Chart I reveals the linear connection between the Rothschilds and the Bank of England, and the London banking houses which ultimately control the Federal Reserve Banks through their stockholdings of bank stock and their subsidiary firms in New York. The two principal Rothschild representatives in New York, J.P. Morgan Co., and Kuhn, Loeb & Co. were the firms which set up the Jekyll Island Conference at which the Federal Reserve Act was drafted, who directed the subsequent successful campaign to have the plan enacted into law by Congress, and who purchased the controlling amounts of stock in the Federal Reserve Bank of New York in 1914. These firms had their principal officers appointed to the Federal Reserve Board of Governors and the Federal Advisory Council in 1914.

In 1914 a few families (blood or business related) owning controlling stock in existing banks (such as in New York City) caused those banks to purchase controlling shares in the Federal Reserve regional banks.

Examination of the charts and text in the House Banking Committee Staff Report of August, 1976 and the current stockholders list of the 12 regional Federal Reserve Banks shows this same family control.

Baruch’s erstwhile partner, Eugene Meyer, (Alaska-Juneau Gold Mining Co.), later claimed that Baruch was a nitwit, and that Meyer, with his family banking connections (Lazard Freres), had guided Baruch’s investment career. These claims appeared in the fiftieth anniversary edition of The Washington Post, editorial page, June 4, 1983, with a parting shot from Meyer’s editor, Al Friendly, that

"Every journalist in Washington, Meyer included, knew that Bernard M. Baruch was a self-aggrandizing phony."

The third member of the Triumvirate, Eugene Meyer, was son of the partner in the international banking house of Lazard Freres, of Paris and New York. In My Own Story Baruch explains how Meyer became head of the War Finance Corporation.

"At the outset of World War One," he says, "I sought out Eugene Meyer, Jr. . . . who was a man of the highest integrity with a keen desire to be of public service." 79

79 Bernard Baruch, My Own Story, Henry-Holt Company, New York, 1957, p. 194

The nation has suffered greatly from persons who desired to be of public service, because their desires often went considerably beyond their passion for office. In fact, Meyer and Baruch had operated an Alaska venture, Alaska-Juneau Gold Mining Company in 1915, and had worked together on other financial schemes. Meyer’s family house of Lazard Freres specialized in international gold movements.

Eugene Meyer’s stewardship of the War Finance Corporation comprises one of the most amazing financial operations ever partially recorded in this country. We say "partially recorded", because subsequent Congressional investigations revealed that each night, the books were being altered before being brought in for the next day’s investigation. Louis McFadden, Chairman of the House Banking and Currency Committee, figured in two investigations of Meyer, in 1925, and again in 1930, when Meyer was proposed as Governor of the Federal Reserve Board.

The Select Committee to Investigate the Destruction of Government Bonds, submitted, on March 2, 1925,

"Preparation and Destruction of Government Bonds--68th Congress, 2d Session, Report No. 1635:

 

p.2.

"Duplicate bonds amounting to 2314 pairs and duplicate coupons amounting to 4698 pairs ranging in denominations from $50 to $10,000 have been redeemed to July 1, 1924. Some of these duplications have resulted from error and some from fraud."

These investigations may explain why, at the end of World War One, Eugene Meyer was able to buy control of Allied Chemical and Dye Corporation, and later on, the nation’s most influential newspaper, The Washington Post. The duplication of bonds, "one for the government, one for me" in denominations to the amount of $10,000 each, resulted in a tidy sum.

p. 6 of these Hearings.

"These transactions of the Treasury prior to June 20, 1920 (including settlements for purchases and sales), executed by the War Finance Corporation (Eugene Meyer, managing director), were largely directed by the managing director of the War Finance Corporation, and settlements with the Treasury were made principally by him with the Assistant Secretary of the Treasury, and the books show that the basis of the price paid by the Government for over $1,894 millions worth of bonds ($1,894,000,000.00), which the Treasury purchased through the War Finance Corporation was not the market price and was not the cost of the bond plus interest, and the elements entering into the settlement are not disclosed by the correspondence. The managing director of the War Finance Corporation stated that he and an Assistant Secretary of the Treasury (Jerome J. Hanauer, partner of Kuhn, Loeb Co. whose daughter married Lewis L. Strauss) agreed to the price, and it was simply an arbitrary figure set by an Assistant Secretary of the Treasury as to the bonds so purchased by the War Finance Corporation.

 

During the period of these transactions and up until quite a recent date the managing director of the War Finance Corporation, Eugene Meyer, Jr., in his private capacity maintained an office at No. 14 Wall Street, New York City, and through the War Finance Corporation sold about $70 millions in bonds to the Government, and also bought through the War Finance Corporation about $10 millions in bonds, and approved the bills for most, if not all, of these bonds in his official capacity as managing director of the War Finance Corporation.

 

When these transactions, just referred to, were disclosed to the committee in open hearing, the managing director appeared before the committee and stated the fact that commissions were paid on these transactions, they were in turn paid over to the brokers, selected by the managing director, who executed the orders issued by his brokerage house, and immediately after this disclosure to the committee, the managing director employed Ernst and Ernst, certified public accountants, to audit the books of the War Finance Corporation, who did, upon completion of the examination of these books, report to the committee that all moneys received by the brokerage house of the managing director had been accounted for.

While simultaneously with the examination being made by the committee, the certified public accountants, heretofore referred to, were nightly carrying on their examination, it was discovered by your committee that alterations and changes were being made in the books of record covering these transactions, and when the same was called to the attention of the treasurer of the War Finance Corporation, he admitted to the committee that changes were being made. To what extent these books have been altered during the process the committee have not been able to determine. After June, 1921, about $10 billions worth of securities were destroyed."

It was Eugene Meyer’s Washington Post, (under the direction of his daughter, Katherine Graham - image above right) which was later to drive a President of the United States from the White House on the grounds that he had knowledge of a burglary.

What are we to think of the revelations of duplications of hundreds of millions of dollars worth of bonds during

CHART II

This chart shows the interlocking banking directorates which were revealed by the backgrounds of the officials selected to be the original members of the Federal Advisory Council in 1914. The principals were the same bankers who had been present or represented at the Jekyll Island Conference in 1910, and during the campaign to have the Federal Reserve Act enacted into law by Congress in 1913.

These officials represented the largest stock holdings in the New York banks which bought the controlling stock in the Federal Reserve Bank of New York, and also were the principal correspondent banks of the banks in other Federal Reserve districts who, in turn, selected their officials to represent them on the Federal Advisory Council.
 

CHART III

The J. Henry Schroder Banking Company chart encompasses the entire history of the twentieth century, embracing as it does the program (Belgian Relief Commission) which provisioned Germany from 1915-1918 and dissuaded Germany from seeking peace in 1916; financing Hitler in 1933 so as to make a Second World War possible; backing the Presidential campaign of Herbert Hoover; and even at the present time, having two of its major executives of its subsidiary firm, Bechtel Corporation serving as Secretary of Defense and Secretary of State in the Reagan Administration.

The head of the Bank of England since 1973, Sir Gordon Richardson, Governor of the Bank of England (controlled by the House of Rothschild), was chairman of J. Henry Schroder, New York, and Schroder Banking Corporation, New York, as well as Lloyd’s Bank of London, and Rolls Royce.

He maintains a residence on Sutton Place in New York City, and as head of "The London Connection", can be said to be the single most influential banker in the world.
 

Meyer’s directorship of the War Finance Corporation, the alteration of the books during a Congressional investigation, and the fact that Meyer came out of this situation with many millions of dollars with which he proceeded to buy Allied Chemical Corporation, The Washington Post, and other properties? Incidentally, Lazard Brothers, Meyer’s family banking house, personally manages the fortunes of many of our political luminaries, including the Kennedy family fortune.

Besides these men, Warburg, Baruch, and Meyer, a host of J.P. Morgan Co., and Kuhn, Loeb Co., partners, employees, and satellites came to Washington after 1917 to administer the fate of the American people.

The Liberty Loans, which sold bonds to our citizens, were nominally in the jurisdiction of the United States Treasury, under the leadership of Wilson’s Secretary of the Treasury, William G. McAdoo, whom Kuhn, Loeb Co. had placed in charge of the Hudson-Manhattan Railway Co. in 1902.

Paul Warburg had most of the Kuhn Loeb Co. firm with him in Washington during the War. Jerome Hanauer, partner in Kuhn, Loeb Co., was Assistant Secretary of the Treasury in charge of Liberty Loans.

The two Under-secretaries of the Treasury during the War were S. Parker Gilbert and Roscoe C. Leffingwell. Both Gilbert and Leffingwell came to the Treasury from the law firm of Cravath and Henderson, and returned to that firm when they had fulfilled their mission for Kuhn, Loeb Co. in the Treasury. Cravath and Henderson were the lawyers for Kuhn Loeb Co. Gilbert and Leffingwell subsequently received partnerships in J.P. Morgan Co.
 

CHART IV

The Peabody-Morgan chart shows the London Connection of these prominent banking firms, which have been headquartered in London since their inception. The Peabody fortune set up an Educational Fund in 1865, which was later absorbed by John D. Rockefeller into the General Educational Board in 1905, which, in turn, was absorbed by the Rockefeller Foundation in 1960.
 

Kuhn, Loeb Company, the nation’s largest owners of railroad properties in this country and in Mexico, protected their interests during the First World War by having Woodrow Wilson set up a United States Railroad Administration.

The Director-General was William McAdoo, Comptroller of the Currency. Warburg replaced this set up in 1918 with a tighter organization which he called the Federal Transportation Council. The purpose of both of these organizations was to prevent strikes against Kuhn, Loeb Company during the War, in case the railroad workers should try to get in wages some of the millions of dollars in wartime profits which Kuhn, Loeb received from the United States Government.

Among the important bankers present in Washington during the War was Herbert Lehman (image right), of the rapidly rising firm of Lehman Brothers, Bankers, New York, Lehman was promptly put on the General Staff of the Army, and given the rank of Colonel.

The Lehmans had had prior experience in "taking the profits out of war", a double entendre and one of Baruch’s favorite phrases. In Men Who Rule America, Arthur D. Howden Smith writes of the Lehmans during the Civil War,

"They were often agents, fixers for both sides, intermediaries for confidential communications and handlers of the many illicit transactions in cotton and drugs for the Confederacy, purveyors of information for the North. The Lehmans, with Mayer in Montgomery, the first capital of the Confederacy, Henry in New Orleans, and Emanuel in New York were ideally situated to take advantage of every opportunity for profit which appeared. They seem to have missed few chances." ⁸⁰

80 Arthur D. Howden Smith, Men Who Rule America, Bobbs Merrill, N.Y. 1935, p. 112
 

CHART V

The David Rockefeller chart shows the link between the Federal Reserve Bank of New York, Standard Oil of Indiana, General Motors, and Allied Chemical Corporation (Eugene Meyer family) and Equitable Life (J.P. Morgan).
 

Other appointments during the First World War were as follows:

• J.W. McIntosh, director of the Armour meat-packing trust, who was made chief of Subsistence for the United States Army in 1918. He later became Comptroller of the Currency during Coolidge’s Administration, and ex-officio member of the Federal Reserve Board. During the Harding Administration, he did his bit as Director of Finance for the United States Shipping Board when the Board sold ships to the Dollar Lines for a hundredth of their cost and then let the Dollar Line default on its payments. After leaving public service, J.W. McIntosh became a partner in J.W. Wollman Co., New York Stockbrokers.
   

• W.P.G. Harding, Governor of the Federal Reserve Board, was also managing director of the War Finance Corporation under Eugene Meyer.
   

• George R. James, member of the Federal Reserve Board in 1923-24, had been Chief of the Cotton Section of the War Industries Board.
   

• Henry P. Davison, senior partner in J.P. Morgan Co., was appointed head of the American Red Cross in 1917 in order to get control of the three hundred and seventy million dollars cash which was collected from the American people in donations.
   

• Ronald Ransom, banker from Atlanta, and Governor of the Federal Reserve Board under Roosevelt in 1938-39, had been the Director in Charge of Personnel for Foreign Service for the American Red Cross in 1918.
   

• John Skelton Williams, Comptroller of the Currency, was appointed National Treasurer of the American Red Cross.

President Woodrow Wilson, the great liberal who signed the Federal Reserve Act and declared war against Germany, had an odd career for a man who is now enshrined as a defender of the common people.

His chief supporter in both his campaigns for the Presidency was Cleveland H. Dodge, of Kuhn Loeb, who controlled National City Bank of New York. Dodge was also President of the Winchester Arms Company and Remington Arms Company. He was very close to President Wilson throughout the great democrat’s political career.

Wilson lifted the embargo on shipment of arms to Mexico on February 12, 1914, so that Dodge could ship a million dollars worth of arms and ammunition to Carranza and promote the Mexican Revolution. Kuhn, Loeb Co. which owned the Mexican National Railways System, had become dissatisfied with the administration of Huerta and had him kicked out.

CHART VI

This chart shows the interlocks between the Federal Reserve Bank of New York, J. Henry Schroder Banking Corp., J. Henry Schroder Trust Co., Rockefeller Center, Inc., Equitable Life Assurance Society (J.P. Morgan), and the Federal Reserve Bank of Boston.
 

When the British naval auxiliary Lusitania was sunk in 1915, it was loaded with ammunition from Dodge’s factories. Dodge became Chairman of the "Survivors of Victims of the Lusitania Fund", which did so much to arouse the public against Germany. Dodge also was notorious for using professional gangsters against strikers in his plants, yet the liberal Wilson does not appear to have ever been disturbed by this.

Another clue to Wilson’s peculiar brand of liberalism is to be found in Chaplin’s book Wobbly, which relates how Wilson scrawled the word "REFUSED" across the appeal for clemency sent him by the aging and ailing Eugene Debs (image left), who had been sent to Atlanta Prison for "speaking and writing against war".

The charge on which Debs was convicted was "spoken and written denunciation of war". This was treason to the Wilson dictatorship, and Debs was imprisoned. As head of the Socialist Party, Debs ran for the Presidency from Atlanta Prison, the only man ever to do so, and polled more than a million votes.

It was ironic that Debs’ leadership of the Socialist Party, which at that time represented the desires of many Americans for an honest government, should fall into the sickly hands of Norman Thomas, a former student and admirer of Woodrow Wilson at Princeton University. Under Thomas’ leadership, the Socialist Party no longer stood for anything, and suffered a steady decline in influence and prestige.

Wilson continued to be deeply involved in the Bolshevik Revolution, as were House and Wiseman. Vol. 3, p. 421 of House Intimate Papers records a cable from Sir William Wiseman to House from London, May 1, 1918, suggesting allied intervention at the invitation of the Bolsheviki to help organize the Bolshevik forces.

Lt. Col. Norman Thwaites, in his memoirs, Velvet and Vinegar says,

"Often during the years 1917-20 when delicate decisions had to be made, I consulted with Mr.(Otto) Kahn, whose calm judgment and almost uncanny foresight as to political and economic tendencies proved most helpful. Another remarkable man with whom I have been closely associated is Sir William Wiseman who was advisor on American affairs to the British delegation at the Peace Conference, and liaison officer between the American and British government during the war. He was rather more the Col. House of this country in his relations with Downing Street." ⁸¹

81 Lt. Col. Norman Thwaites, Velvet and Vinegar, Grayson Co., London, 1932

CHART VII

This chart shows the interlocks of the Federal Reserve Bank of New York with Citibank, Guaranty Bank and Trust Co. (J.P. Morgan), J.P. Morgan Co., Morgan Guaranty Trust Co., Alex Brown & Sons (Brown Brothers Harriman), Kuhn Loeb & Co., Los Angeles and Salt Lake RR (controlled by Kuhn Loeb Co.), and Westinghouse (controlled by Kuhn Loeb Co.).
 

In the summer of 1917, Woodrow Wilson named Col. House to head the American War Mission to the Interallied War Conference, the first American mission to a European council in history. House was criticized for naming his son-in-law, Gordon Auchincloss, as his assistant on this mission. Paul Cravath, the lawyer for Kuhn, Loeb Company, was third in charge of the American War Mission. Sir William Wiseman guided the American War Mission in its conferences.

In The Strangest Friendship in History, Viereck writes,

"After America entered the War, Wiseman, according to Northcliffe, was the only man who had access at all times to the Colonel and to the White House. Wiseman rented an apartment in the House where the Colonel lived. David Lawrence referred to the Fifty-Third Street house (New York City) jestingly as the American No. 10 Downing St. . . . Col. House had a special code used only with Sir William Wiseman. Col. House was Bush, the Morgans were Haslam, and Trotsky was Keble." 82

82 George Sylvester Viereck, The Strangest Friendship in History, Woodrow Wilson and Col. House, Liveright, N.Y. 1932, p. 172

Thus these two "unofficial" advisors to the British and American governments had a code solely for each other, which no one else could understand. Even stranger was the fact that the international Communist espionage apparatus for many years used Col. House’s book, Philip Dru - Administrator, as their official code book.

Francois Coty writes,

"Gorodin, Lenin’s agent in China, was alleged to have with him a copy of the book published by Col. House, Philip Dru, Administrator and a code expert who lived in China told this writer that the purpose of having constant access to this book by Gorodin was to use it for coding and decoding messages." ⁸³

83 Francois Coty, Tearing Away the Veil, Paris, 1940

CHART VIII

This chart shows the link between the Federal Reserve Bank of New York, Brown Brothers Harriman, Sun Life Assurance Co. (N.M. Rothschild and Sons), and the Rockefeller Foundation.
 

After the Armistice, Woodrow Wilson assembled the American Delegation to the Peace Conference, and embarked for Paris. It was, on the whole, a most congenial group, consisting of the bankers who had always guided Wilson’s policies. He was accompanied by

• Bernard Baruch

• Thomas W. Lamont of J.P. Morgan Co.

• Albert Strauss of J & W Seligman bankers, who had been chosen by Wilson to replace Paul Warburg on the Federal Reserve Board of Governors

• J.P. Morgan

• Morgan lawyers Frank Polk and John W. Davis

Accompanying them were Walter Lippmann, Felix Frankfurter, Justice Brandeis, and other interested parties. Mason’s biography of Brandeis states that,

"In Paris in June of 1919, Brandeis met with such friends as Paul Warburg, Col. House, Lord Balfour, Louis Marshall, and Baron Edmond de Rothschild."

Indeed, Baron Edmond de Rothschild served as the genial host to the leading members of the American Delegation, and even turned over his Paris mansion to them, although the lesser members had to rough it at the elegant Hotel Crillon with Col. House and his personal staff of 201 servants.

Baruch later testified before the Graham Committee of the Senate Foreign Relations Committee,

"I was economic advisor with the peace mission.

 

GRAHAM: Did you frequently advise the President while there?

BARUCH: Whenever he asked my advice I gave it. I had something to do with the reparations clauses. I was the American Commissioner in charge of what they called the Economic Section. I was a member of the Supreme Economic Council in charge of raw metals.

 

GRAHAM: Did you sit in the council with the gentlemen who were negotiating the treaty?

BARUCH: Yes, sir, some of the time.

 

GRAHAM: All except the meetings that were participated in by the Five? (The Five being the leaders of the five allied nations).

BARUCH: And frequently those also."

CHART IX

This chart shows the interlocks between the Federal Reserve Bank of New York and J.P. Morgan Co., Morgan Guaranty Trust Co., and the Rothschild affiliates of Royal Bank of Canada, Sun Life Assurance Co. of Canada, Sun Alliance, and London Assurance Group.
 

Paul Warburg (image right) accompanied Wilson on the American Commission to Negotiate Peace as his chief financial advisor. He was pleasantly surprised to find at the head of the German delegation his brother, Max Warburg, who brought along Carl Melchior, also of M.M. Warburg Company, William Georg von Strauss, Franz Urbig, and Mathias Erzberger.

Thomas W. Lamont states in his privately printed memoirs, Across World Frontiers,

"The German delegation included two German bankers of the Warburg firm whom I happened to know slightly and with whom I was glad to talk informally, for they seemed to be striving earnestly to offer some reparations composition that might be acceptable to the Allies." 84

Lamont was also pleased to see Sir William Wiseman, chief advisor to the British delegation.
 

84 Thomas W. Lamont, Across World Frontiers, (Privately printed) 1950, p. 138

The bankers at the conference convinced Wilson that they needed an international government to facilitate their international monetary operations. Vol. IV, p. 52, Intimate Papers of Col. House quotes a message from Sir William Wiseman to Lord Reading, August 16, 1918,

"The President has two main principles in view; there must be a League of Nations and it must be virile."

Wilson, who seems to have lived in a world of fantasy, was shocked when American citizens booed him during his campaign to have them sign over their hard won independence to what appeared to many to be an international dictatorship.

He promptly went into a depression, and retired to his bedroom. His wife immediately shut the White House doors against Col. House, and from September 25, 1919 to April 13, 1920, she ruled the United States with the aid of an intimate friend, her "military aide", Col. Rixey Smith. As everyone was shut out of their deliberations, no one ever knew which of the pair functioned as the President, and which was the Vice President.

The admirers of Woodrow Wilson were led for decades by Bernard Baruch, who stated that Woodrow Wilson was the greatest man he ever knew. Wilson’s appointments to the Federal Reserve Board, and that body’s responsibility for financing the First World War, as well as Wilson’s handing over the United States to the immigrant triumvirate during the War, made him appear to be the most important single effector of ruin in American history.

It is no wonder that after his abortive trip to Europe, where he was hissed and jeered in the streets by the French people, and snickered at in the halls of Versailles by Orlando and Clemenceau, Woodrow Wilson returned home to take to his bed. The sight of the destruction and death in Europe, for which he was directly responsible, was perhaps more of a shock than he could bear.

The Italian Minister Pentaleoni expressed the feelings of the European peoples when he wrote that:

"Woodrow Wilson is a type of Pecksniff who was now disappeared amid universal execration."

It is America’s misfortune that our subsidized press and educational system have been devoted to enshrining a man who colluded in causing so much death and sorrow throughout the world.

The financial cartel suffered only minor setbacks in those crucial years. On February 12, 1917, The New York Times reported that,

"The five members of the Federal Reserve Board were impeached on the floor of the House by Rep. Charles A. Lindbergh (image right), Republican member of the House Banking and Currency Committee. According to Mr. Lindbergh, ‘the conspiracy began in’ 1906 when the late J.P. Morgan, Paul M. Warburg, a present member of the Federal Reserve Board, the National City Bank and other banking firms ‘conspired’ to obtain currency legislation in the interest of big business and the appointment of a special board to administer such a law, in order to create industrial slaves of the masses, the aforesaid conspirators did conspire and are now conspiring to have the Federal Reserve Board administered so as to enable the conspirators to coordinate all kinds of big business and to keep themselves in control of big business in order to amalgamate all the trusts into one great trust in restraint and control of trade and commerce."

The impeachment resolution was not acted on by the House.

The New York Times reported on August 10, 1918,

"Mr. Warburg’s term having expired, he voluntarily retired from the Federal Reserve Board."

Thus the previous intimation that Mr. Warburg left the Federal Reserve Board because he had a brother in the Secret Service of a foreign country, namely, Germany, with whom we were at war, was not the cause of his retirement. In any case, he did not leave the Federal Reserve Administration, as he immediately took over J.P. Morgan’s seat on the Federal Advisory Council, from which post he continued to administer the Federal Reserve System for the next ten years.
 

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