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  World War II Background


What Really Caused World War 2?

The Lead Up to World War 2

Chemical Cartels

Without a doubt, a key player in the cause of World War 2 was the powerful Adolf Hitler.  But the major source of Hitler's power came from a chemical cartel called I.G. Farben, (the name is an abbreviation of the complete name: Interssen Gemeinschaft Farben.) The importance of I.G. Farben's support for the Socialist movement was pointed out in a book about the cartel, in which it is stated: "without I.G.'s immense production facilities, its far reaching research, varied technical experience and overall concentration of economic power, Germany would not have been in a position to start its aggressive war in September, 1939."1

But I.G. Farben had a little-known source of its enormous economic power: Wall Street, U.S.A. "Without the capital supplied by Wall Street, there would have been no I.G. Farben in the first place, and almost certainly no Adolf Hitler and World War II."2

I.G. Farben had its beginning in 1924 when American banker Charles Dawes arranged a series of foreign loans totalling $800 million to consolidate gigantic chemical and steel combinations into cartels, one of which was I.G. Farben. Professor Can-oil Quigley terms the Dawes Plan: "largely a J.P. Morgan production."3

Three Wall Street houses, Dillon, Read & Co.; Harris, Forbes & Co.; and National City handled three-quarters of the loans used to create these cartels.

The importance of LG. Farben to the plans of the German Nazi Party can be illustrated by a product that an I.G. dominated company manufactured. It was called Zyklon B, the lethal gas utilized by the exterminators at Auschwitz, Bitterfeld, Walfen, Hoechst, Agfa, Ludwigshafen, and Buchenwald. (I.G. Farben, being a chemical company even before it was merged with other chemical companies to form the cartel, was also the producer of the chlorine gas used during World War I.) American support for I.G. Farben continued as Henry Ford merged his German assets with those of I.G. in 1928.4

But the real importance of I.G. to the war efforts of Adolf Hitler came in the utilization of the process known as hydrogenation, the production of gasoline from coal, created by the I.G. Farben chemical cartel. Germany had no native gasoline production capabilities, and this was one of the main reasons it lost World War I. A German scientist discovered the process of converting coal (Germany was the possessor of large quantities of coal) into gasoline in 1909, but the technology was not completely developed during the war. In August, 1927, Standard Oil agreed to embark on a cooperative program of research and development of the hydrogenation process to refine the oil necessary for Germany to prepare for World War II.

And finally, on November 9, 1929, these two giant companies signed a cartel agreement that had two objectives:

First, the cartel agreement granted Standard Oil one-half of all rights to the hydrogenation process in all countries of the world except Germany; and

Secondly, the two agreed: "... never to compete with each other in the fields of chemistry and petroleum products. In the future, if Standard Oil wished to enter the broad field of industrial chemicals or drugs, it would do so only as a partner of Farben.

Farben, in turn, agreed never to enter the field of petroleum except as a joint venture with Standard."5

This cartel agreement was extremely important to the war effort, because, by the end of the war, Germany was producing about seventy-five percent of its fuel synthetically.

But even more significant was the fact that these plants were not the subject of Allied bombing raids, so that, by the war's end, twenty-five to thirty of its refineries were still operating with only about fifteen percent damage.

Standard Oil got into the refining business as well. In fact, William Dodd, the U.S. Ambassador in Germany, wrote the following in his diary about the pre-war years around 1936: "The Standard Oil Company of New York, the parent company of the Vacuum (Oil Company,) has spent 10,000,000 marks in Germany trying to find oil resources and (in) building a great refinery near the Hamburg harbor."6

President Herbert Hoover

Meanwhile, back in the United States, preparations were being made to elect a President. In 1932, President Herbert Hoover, a member of the CFR, was seeking re-election. He was approached by "Henry Harriman, President of that body (the United States Chamber of Commerce who) urged that I agree to support these proposals (the National Industry Recovery Act, the NRA, amongst others,) informing me that Mr. Roosevelt had agreed to do so.  I tried to show him that this stuff was pure fascism; that it was merely a remaking of Mussolini's 'corporate state' and refused to agree to any of it.  He informed me that in view of my attitude, the business world would support Roosevelt with money and influence."7

Hoover, later in 1940, indirectly explained why he refused the support of the American business community. He saw inherent problems with government control of the business world:

In every single case before the rise of totalitarian governments there had been a period dominated by economic planners.

Each of these nations had an era under starry-eyed men who believed that they could plan and force the economic life of the people.

They believed that was the way to correct abuse or to meet emergencies in systems of free enterprise.

They exalted the state as the solver of all economic problems.  These men thought they were liberals. But they also thought they could have economic dictatorship by bureaucracy and at the same time preserve free speech, orderly justice, and free government.

They might be called the totalitarian liberals.

Directly or indirectly they politically controlled credit, prices, production of industry, farmer and laborer.

They devalued, pump-primed, and deflated. They controlled private business by government competition, by regulation and by taxes. They met every failure with demands for more and more power and control....

Then came chronic unemployment and frantic government spending in an effort to support the unemployed.

Government debts mounted and finally government credit was undermined.

And then came the complete takeover, whether it was called Fascism, Socialism, or Communism.

Yet, even with Hoover's refusal to support the goals of "big business," Roosevelt's presidential campaign of 1932 consistently attacked President Hoover for his alleged association with the international bankers and for pandering to the demands of big business. The pervasive historical image of FDR is one of a president fighting on behalf of "the little guy," the man in the street, in the midst of unemployment and financial depression brought about by "big business" speculators allied with Wall Street.  "Roosevelt was a creation of Wall Street [and] an integral part of the New York banking fraternity...."8

The 1932 presidential campaign strategy was very simple: "big business" wanted Roosevelt, but ran him as an "anti-big business" candidate.  Hoover was "anti-big business," but the media convinced the American people that he was "pro-big business."

The result was predictable. Roosevelt defeated the incumbent Hoover.  He could now start his move, what he called the "New Deal," towards a Fascist state. One observer, Whitaker Chambers, the American Communist Party member who defected, commented thus about the "New Deal:" "(It) was a genuine revolution, whose deepest purpose was not simply reform within existing traditions but a basic change in the social, and above all, the power relationship within the nation."9

The Plot to Seize the White House

It was about this time that an incredible scheme concerning the presidency of the United States started taking shape. From July, 1932 through November, 1933, a well known and popular military general. Major General Smedley Butler of the U.S. Marine Corps "...was sought by wealthy plotters in the United States to lead a putsch (revolution) to overthrow the government and establish an American Fascist dictatorship."10

Butler was tempted into the plot by "... the biggest bribe ever offered to any American—the opportunity to become the first dictator of the United States." He was approached by three gentlemen: Grayson Mallet-Provost Murphy, a director of Guaranty Trust, a J.P. Morgan Bank; Robert S. Clark, a banker who had inherited a large fortune from a founder of the Singer Sewing Machine Company; and John W. Davis, the 1924 Democratic candidate for President and the chief attorney for J.P. Morgan and Company.  Their plan was to "... seize the White House with a private army [of 500,000 veterans], hold Franklin Roosevelt prisoner, and get rid of him if he refused to serve as their puppet in a dictatorship they planned to impose and control.”11

The plotters revealed to Butler that they had $3 million in working funds and could get $300 million if it were needed.

Why the plotters selected General Butler is a mystery, as Butler truly understood his role as a general in the Marine Corps.  He was on record as saying: "War was largely a matter of money. Bankers lend money to foreign countries and when they cannot repay, the President sends Marines to get it.  I know - I've been in eleven of these expeditions.”12

Butler's assertions that the military actually acted as a collection agency for the big bankers was confirmed in 1934 by the Senate Munitions Investigating Committee which "confirmed his (Butler's) suspicions that big business - Standard Oil, United Fruit, the sugar trust, the big banks – had been behind most of the military interventions he had been ordered to lead."13

In addition, Congress created the McCormack-Dickstein Committee to investigate Butler's charges. The conclusions of this group confirmed General Butler's charges by finding five significant facts that lent validity to Butler's testimony.

Jules Archer, the author of the book on Butler's charges, entitled The Plot to Seize the White House, interviewed John J. McCormack, the co-chairman of the Committee and asked for his views on the plot:

Archer- Then in your opinion, America could definitely have been a Fascist power had it not been for General Butler's patriotism in exposing the plot?

McCormack: It certainly could have. The people were in a very confused state of mind, making the nation weak and ripe for some drastic kind of extremist reaction. Mass frustration could bring about anything.14

There are those, however, who believe that the intent of the plotters was not the imposition of Butler as the leader of the government, but was actually to use the incident as a means by which Roosevelt could impose a dictatorship down upon the American people after Butler led his army upon the White House. This action, after Roosevelt termed it to be a “national emergency," could have enabled him to take complete control of the government in the emergency, and the American people would probably have cheered the action. So Butler was, according to this theory, only the excuse to take complete control of the machinery of the government, and was never intended to be the new dictator.

The plan failed, after Butler revealed the existence of the plot, and Roosevelt had to be content, if the theory is correct, with just being the President and not the dictator of the United States. Roosevelt had other plans for a fascist United States, however. Frances Perkins, Roosevelt's Labor Secretary, reports that "At the first meeting of the cabinet after the President took office in 1933, the financier and advisor to Roosevelt, Bernard Baruch, and Baruch's friend, General Hugh Johnson, who was to become the head of the National Recovery Administration, came in with a copy of a book by Gentile, the Italian Fascist theoretician, for each member of the Cabinet, and we all read it with care."15

So the plan was to move the American government into the area of Fascism or government control of the factors of production without a Butler-led revolution. It was decided that one of the main methods of achieving this goal was through a war, and the plans for a war involving the United States were being laid.

War With Japan

One of the sources for confirming the fact that these plans were underway is Jim Parley, Roosevelt's Postmaster General and a member of Roosevelt's Cabinet.  Mr. Parley wrote that at the second cabinet meeting in 1933: "The new President again turned to the possibility of war with Japan.”

It is possible that President Roosevelt knew that war with Japan had been planned even before 1933. According to one historian, Charles C. Tansill, professor of diplomatic history at Georgetown University, war with Japan was planned as early as 1915.

In a book entitled Pearl Harbor, Roosevelt and the Coming of the War, published by D.C. Heath and Company, Professor Tansill makes this interesting observation:

The policy of pressure upon Japan antedated [President Roosevelt's Secretary of War Henry] Stimson some two decades...

Under Woodrow Wilson, a three-pronged offensive was launched against Nippon [Japan]....

In January, 1915, the American minister at Peking... sent to the Department of State a series of dispatches so critical in tone that they helped to create in American minds a fixation of Japanese wickedness that made eventual war with Japan a probability.

It will be recalled that Franklin Roosevelt had been appointed Wilson's Assistant Secretary of the Navy, so it is both conceivable and probable that he knew about these dispatches and the plans to involve us in a future war with Japan as early as 1915.

If the professor is correct, it was not Roosevelt's purpose to bring President Wilson's plans into fruition. All that was needed was an act that could be utilized as the reason for a declaration of war against Japan.

That reason was an attack at Pearl Harbor.

In fact, the American government knew that they were vulnerable at Pearl Harbor, the site of Japan's "surprise" attack to start World War II. It was at Pearl Harbor in 1932 that the United States Navy conducted maneuvers to test the chances of success of an attack from the sea. They discovered that Pearl Harbor was vulnerable from as close as sixty miles off the shore.  That meant that Japan could attack from sixty miles away from Pearl Harbor and be undetected. The American Navy had proved it.

American Business in the War

Not only was the government concerning itself with a possible war with Japan, but it was also aware that American capitalists were creating a war machine in Germany in the early 1930's, years before Germany started their involvement in World War II.

William Dodd, the U.S. Ambassador in Germany, wrote Roosevelt from Berlin:

At the present moment, more than a hundred American corporations have subsidiaries here or cooperative understandings.

The DuPonts have their allies in Germany that are aiding in the armament business. Their chief ally is the I.G. Farben Company, a part of the government which gives 200,000 marks a year to one propaganda organization operating on American opinion.

Standard Oil Company... sent $2,000,000 here in December, 1933 and has made $500,000 a year helping Germans make ersatz [a substitute] gas [the hydrogenation process of converting coal to gasoline] for war purposes; but Standard Oil cannot take any of its earnings out of the country except in goods.

The International Harvester Company president told me their business here rose 33% year [arms manufacture, I believe], but they could take nothing out.

Even our airplanes people have secret arrangements with Krupps.

General Motors Company and Ford do enormous business here through their subsidiaries and take no profits out.16

In addition to these American companies, others were assisting the Germans in creating the materials they needed to wage war. For instance, International Telephone and Telegraph (I.T.T.) purchased a substantial interest in Focke-WoIfe, an airplane manufacturer which meant that I.T.T. was producing German fighter aircraft used to kill Americans.

I.G. Farben's assets in America were controlled by a holding company called American I.G. Farben. The following individuals, among others, were members of the Board of Directors of this corporation:

  • Edsel Ford, President of the Ford Motor Co.;

  • Charles E. Mitchell, President of Rockefeller's National City Bank of New York;

  • Walter Teagle, President of Standard Oil of New York;

  • Paul Warburg, Chairman of the Federal Reserve, and the brother of Max Warburg, the financier of Germany's war effort, and

  • Herman Metz, a director of the Bank of Manhattan, controlled by the Warburgs.

It is an interesting and revealing fact of history that three other members of the Board of Governors of the American I.G. were tried and convicted as German "war criminals" for their crimes "against humanity," during World War II, while serving on the Board of Governors of I.G. Farben. None of the Americans who sat on the same board with those convicted were ever tried as "war criminals" even though they participated in the same decisions as the Germans. It appears that it is important whether your nation wins or loses the war as to whether or not you are tried as a "war criminal."

It was in 1939, during the year that Germany started the war with its invasions of Austria and Poland, that Standard Oil of New Jersey loaned I.G. Farben $20 million of high-grade aviation gasoline.

The two largest German tank manufacturers were Opel, a wholly owned subsidiary of General Motors and controlled by the J.P. Morgan firm, and the Ford subsidiary of the Ford Motor Company.

In addition, Alcoa and Dow Chemical transferred technology to the Germans, as did Bendix Aviation, in which the J.P. Morgan-controlled General Motors had a major stock interest, which supplied data on automatic pilots, aircraft instruments and aircraft and diesel engine starters.

In addition to direct material support, other "capitalistic" companies supplied support: In 1939 the German electrical equipment industry was concentrated into a few major corporations linked in an international cartel and by stock ownership to two major U.S. corporations (International General Electric and International Telephone and Telegraph.)

Further support for the American owned or controlled corporations came during the war itself, when their industrial complexes, their buildings and related structures, were not subject to Allied bombing raids: "This industrial complex (International General Electric and International Telephone and Telegraph) was never a prime target for bombing in World War II. The electrical equipment plants bombed as targets were not affiliated with U.S. firms."17

Another example of a German General Electric plant not bombed was the plant at Koppelsdorf, Germany, producing radar sets and bombing antennae.  Perhaps the reason certain plants were bombed and others weren't lies in the fact that, under the U.S. Constitution, the President is the Commander-in-Chief of all armed forces, and therefore the determiner of what targets are bombed.

The significance of America's material support to the German government's war efforts comes when the question as to what the probable outcome of Germany's efforts would be: "... not only was an influential sector of American business aware of the nature of Nazism, but for its own purposes aided Nazism wherever possible (and profitable) with full knowledge that the probable outcome would be war involving Europe and the United States."18

Even Hitler's ideas about exterminating the Jews were known to any observer who cared to do a little research. Hitler himself had written: "I have the right to exterminate millions of individuals of inferior races, which multiply like vermin."

In addition, Hitler made his desires known as early as 1923 when he detailed his plans for the Jews in his book Mein Kampf. Even the SS Newspaper, the Black Corps called for: "The extermination with fire and sword, the actual and final end of Jewry."

This material support continued even after the war officially started. For instance, even after Germany invaded Austria in March, 1938, the Ethyl Gasoline Corporation, fifty percent owned by General Motors and fifty percent by Standard Oil, was asked by I.G. Farben to build tetra-ethyl plants in Germany, with the full support of the U.S. Department of War which expressed no objection to the transactions.

And in August, 1938, I.G. Farben "borrowed" 500 tons of tetra-ethyl lead, the gas additive, from Standard Oil.

Later, after the invasion of Austria, and prior to the German invasion of Poland in 1939, Germany and Russia signed a pact on August 23,1939, with a secret clause for the division of Poland by these two war-time allies.

All of the material support and all of the secret agreements came to a head on September 1, 1939, when Germany invaded Poland in accordance with the terms of the pact signed with Russia.

The Second World War had begun.


Next: The Start of World War 2

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Today is World War 3 on March 20, 2003 and the terrorist attacks of September 11, 2001.