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For The Record  

FTR #479 World War II-Era Lawsuit and the Bush Family

Recorded October 3, 2004
REALAUDIO
NB: This stream contains both FTR #s 479 and 480 in sequence. Each is a 30 minute broadcast.

Revisiting a subject well known to veteran listeners, this program examines more research into the Bush family’s links to Nazi industry. In particular, recent disclosures have led to a lawsuit by two Auschwitz survivors against the Bush family that claims that the Bushes profited from slave labor in the Nazi concentration camps. Of particular interest is the fact that one of the Bush-related businesses—Consolidated Silesian Steel Company—was the beneficiary of slave labor from Auschwitz. Listeners interested in the Bush/Nazi industry link will be pleased to note that three books are soon to be published about that subject.

Program Highlights Include: Review of the Brown Brothers Harriman link to the Thyssen family; review of the Thyssen group’s establishment of foreign subsidiaries to mask their assets; the liquidation of the Nazi-linked UBC and how it helped boost the Bush family’s already considerable wealth; an order by President Roosevelt from January of 1944 that is the legal foundation of the plaintiffs’ suit against the Bush family; proof that the Bush family’s disclaimers of knowledge of the Nazi links of their companies are disingenuous.

1. Beginning the discussion of the lawsuit, the Guardian article that comprises the subject material of the program, the broadcast frames the basic topic of the Bush family’s links to Nazi industry. (For more about this subject—covered at length in the For The Record series—see [among other programs] FTR#’s 273, 332, 370, 406, 435, 475, 481.) Be sure to view the actual de-classified government documents on this subject. George Bush’s grandfather, the late US senator Prescott Bush, was a director and shareholder of companies that profited from their involvement with the financial backers of Nazi Germany. The Guardian has obtained confirmation from newly discovered files in the US National Archives that a firm of which Prescott Bush was a director was involved with the financial architects of Nazism. His business dealings, which continued until his company’s assets were seized in 1942 under the Trading with the Enemy Act, has led more than 60 years later to a civil action for damages being brought in Germany against the Bush family by two former slave laborers at Auschwitz and to a hum of pre-election controversy.”
(“How Bush’s Grandfather Helped Hitler’s Rise to Power” by Ben Aris and Duncan Campbell; The Guardian; 9/25/2004; p. 1.)

2. “The evidence has also prompted one former US Nazi war crimes prosecutor to argue that the late senator’s action should have been grounds for prosecution for giving aid and comfort to the enemy. The debate over Prescott Bush’s behavior has been bubbling under the surface for some time. There has been a steady internet chatter about the ‘Bush/Nazi’ connection . . . . But the new documents, many of which were only declassified last year, show that even after America had entered the war and when there was already significant information about the Nazis’ plans and policies, he worked for and profited from companies closely involved with the very German businesses that financed Hitler’s rise to power. It also has been suggested that the money he made from these dealings helped to establish the Bush family fortune and set up its political dynasty.” (Idem.)

3. The program presents information about the lawsuit filed by two Holocaust survivors and several forthcoming books about the subject: “Remarkably, little of Bush’s dealings with Germany has received public scrutiny, partly because of the secret status of the documentation involving him. But now the multibillion dollar legal action for damages by two Holocaust survivors against the Bush family, and the imminent publication of three books on the subject are threatening to make Prescott Bush’s business history an uncomfortable issue for his grandson, George W, as he seeks re-election.” (Idem.)

4. The program highlights the links between the Thyssens and the Harriman/Walker/Bush businesses–the Union Banking Corporation in particular. (These links have been discussed many times on the program, and are detailed in the FTR shows mentioned above. For that reason, they will not be discussed at great length in the supplemental text to this description.) “ . . . the documents reveal that the firm he worked for, Brown Brothers Harriman (BBH), acted as a US base for the German industrialist, Fritz Thyssen, who helped finance Hitler in the 1930’s before falling out with him at the end of the decade. The Guardian has seen evidence that shows Bush was the director of the New York-based Union Banking Corporation (UBC) that represented Thyssen’s US interests and he continued to work for the bank after America entered the war.” (Idem.)

5. Highlighting one of the issues that precipitated the lawsuit by the Auschwitz survivors, the broadcast mentions Bush’s links to the Consolidated Silesian Steel Company—located near Auschwitz “Bush was also on the board of at least one of the companies that formed part of a multinational network of front companies to allow Thyssen to move assets around the world. Thyssen owned the largest steel and coal company in Germany and grew rich from Hitler’s efforts to re-arm between the two world wars. One of the pillars in Thyssen’s international corporate web, UBC, worked exclusively for, and was owned by, a Thyssen-controlled bank in the Netherlands. More tantalizing are Bush’s links to the Consolidated Silesian Steel Company (CSSC), based in mineral rich Silesia on the German-Polish border. During the war, the company made use of Nazi slave labor from the concentration camps, including Auschwitz. The ownership of CSSC changed hands several times in the 1930’s, but documents from the US National Archive declassified last year link Bush to CSSC, although it is not clear if he and UBC were still involved in the company when Thyssen’s American assets were seized in 1942.” (Ibid.; p. 2.)

6. “Three sets of archives spell out Prescott Bush’s involvement. All three are readily available, thanks to the efficient US archive system and a helpful and dedicated staff at both the Library of Congress in Washington and the National Archives at the University of Maryland. The first set of files, the Harriman papers in the Library of Congress, show that Prescott Bush was a director and shareholder of a number of companies involved with Thyssen.” (Idem.)

7. “The second set of papers, which are in the National Archives, are contained in vesting order number 248, which records the seizure of the company assets. What these files show is that on October 20, 1942 the alien property custodian seized the assets of the UBC, of which Prescott Bush was a director. Having gone through the books of the bank, further seizures were made against two affiliates, the Holland-American Trading Corporation and the Seamless Steel Equipment Corporation. By November, the Silesian-American Company, another of Prescott Bush’s ventures, had also been seized.” (Idem.)

8. “The third set of documents, also at the National Archives, are contained in the files on IG Farben, who was prosecuted for war crimes. A report issued by the Office of Alien Property Custodian in 1942 stated of the companies that ‘since 1939, these (steel and mining) properties have been in possession of and have been operated by the German government and have undoubtedly been of considerable assistance to that country??

?s war effort.’” (Idem.)

9. “Prescott Bush . . . was the founder of the Bush political dynasty and was once considered a potential presidential candidate himself. Like his son, George, and grandson, George W, he went to Yale where he was, again like his descendants, a member of the secretive and influential Skull and Bones society. . . . In 1924, his father-in-law, a well-known St. Louis investment banker, helped set him up in business in New York with Averill Harriman, the wealthy son of railroad magnate E. H. Harriman in New York, who had gone into banking.” (Idem.)

10. One of the most significant pieces of information concerns the function UBC was to perform for the Thyssen business empire: an offshore financial haven into which the Thyssen assets could be secreted in the event they were threatened during another war. In FTR#’s 273, 370, 435, 481, we viewed the Bush family’s links to the postwar flight capital program realized by the Bormann organization. “One of the first jobs Walker gave Bush was to manage UBC. Bush was a founding member of the bank and the incorporation documents, which list him as one of seven directors, show he owned one share in UBC worth $125.00 The bank was set up by Harriman and Bush’s father-in-law to provide a US bank for the Thyssens, Germany’s most powerful industrial family. August Thyssen, the founder of the dynasty had been a major contributor to Germany’s first world war effort and in the 1920’s, he and his sons Fritz and Heinrich established a network of overseas banks and companies so their assets and money could be whisked offshore if threatened again.” (Idem.)

11. The article highlights Fritz Thyssen’s support for Hitler: “By the time Fritz Thyssen inherited the business empire in 1926, Germany’s economic recovery was faltering. After hearing Adolf Hitler speak, Thyssen became mesmerized by the young firebrand. He joined the Nazi party in December 1931 and admits backing Hitler in his autobiography, I Paid Hitler, when the National Socialists were still a radical fringe party. He stepped in several times to bail out the struggling party: in 1928 Thyssen had bought the Barlow Palace on Briennerstrasse, in Munich, which Hitler converted into the Brown House, the headquarters of the Nazi Party. The money came from another Thyssen overseas institution, the Bank voor Handel en Scheepvaart in Rotterdam.” (Ibid.; p. 3.)

12. “By the late 1930’s, Brown Brothers Harriman, which claimed to be the world’s largest private investment bank, and UBC had bought and shipped millions of dollars of gold, fuel, steel, coal and US treasury bonds to Germany, both feeding and financing Hitler’s build-up to war. Between 1931 and 1933, UBC bought more than $8 million worth of gold, of which $3million was shipped abroad. According to documents seen by The Guardian, after UBC was set up it transferred $2m to BBH accounts and between 1924 and 1940 the assets of UBC hovered around $3 million, dropping to $1 million only on a few occasions. . . .” (Idem.)

13. “ . . . There was nothing illegal in doing business with the Thyssens throughout the 1930’s and many of America’s best-known business names invested heavily in the German economic recovery. However, everything changed after Germany invaded Poland in 1939. Even though it could be argued that BBH was within its rights continuing business relations with the Thyssens until the end of 1941 as the US was still technically neutral until the attack on Pearl Harbor. The trouble started on June 30, 1942 when the New York Herald-Tribune ran an article entitled ‘Hitler’s Angel Has $3m in US Bank.’ UBC’s huge gold purchases had raised suspicions that the bank was in fact a ‘secret nest egg’ hidden in New York for Thyssen and other Nazi bigwigs. The Alien Property Commission (APC) launched an investigation.” (Idem.)

14. “There is no dispute over the fact that the US government seized a string of assets controlled by BBH-including UBC and SAC [Sullivan & Cromwell]—in the autumn of 1942 under the Trading with the Enemy act. What is in dispute is if Harriman, Walker and Bush did more than own these companies on paper. Erwin May, a treasury attaché and officer for the department of investigation in the APC, was assigned to look into UBC’s business. The first fact to emerge was that Roland Harriman, Prescott Bush and the other directors didn’t actually own their shares in UBC but merely held them on behalf of Bank voor Handel. Strangely, no one seemed to know who owned the Rotterdam-based bank, including UBC’s president.” (Idem.)

15. “May wrote in his report of August 16, 1941: ‘Union Banking Corporation, incorporated August 4, 1924, is wholly owned by the Bank voor Handel en Scheepvaart N.V. of Rotterdam, the Netherlands. My investigation has produced no evidence as to the ownership of the Dutch bank. Mr. Cornelis Livense, president of UBC, claims no knowledge as to the ownership of the Bank voor Handel but believes it possible that Baron Heinrich Thyssen, brother of Fritz Thyssen, may own a substantial interest.’ May cleared the bank of holding a golden nest egg for the Nazi leaders but went on to describe a network of companies spreading out from UBC across Europe, America and Canada, and how money from voor Handel traveled to these companies through UBC.” (Idem.)

16. “By September, May had traced the origins of the non-American board members and found that Dutchman HJ Kouwenhoven—who met with Harriman in 1924 to set up UBC—had several other jobs: in addition to being the managing director of voor Handel he was also the director of the August Thyssen bank in Berlin and a director of Fritz Thyssen’s Union Steel Works, the holding company that controlled Thyssen’s steel and coal mine empire in Germany.” (Idem.)

17. “Within a few weeks, Homer Jones, the chief of the APC investigation and research division sent a memo to the executive committee of APC recommending the US government vest UBC and its assets. Jones named the directors of the bank in the memo, including Prescott Bush’s name, and wrote: ‘Said stock is held by the above named individuals, however, solely as nominees for the Bank voor Handel, Rotterdam, Holland, which is owned by one or more of the Thyssen family, nationals of Germany and Hungary. The 4,000 shares hereinbefore set out are therefore beneficially owned and help for the interests of enemy nationals, and are vestible by the APC,’ according to the memo from the National Archives seen by The Guardian.” (Ibid.; p. 4.)

18. The liquidation of UBC appears to have yielded $1.5 million to the Bush family—a great deal of money in the early 1950’s. “Jones recommended that the assets be liquidated for the benefit of the government, but instead UBC was maintained intact and eventually returned to the American shareholders after the war. Some claim that Bush sold his share in UBC after the war for $1.5 million—a huge amount of money at the time. . . No further action was ever taken nor was the investigation continued, despite the fact UBC was caught red-handed operating an American shell company for the Thyssen family eight months after American had entered the war and that this was the bank that had partly financed Hitler’s rise to power. The most tantalizing part of the story remains shrouded in mystery: the connection, if any, between Prescott Bush, Thyssen, Consolidated Silesian Steel Company (CSSC) and Auschwitz.” (Idem.)

19. More about the Bush family’s involvement with CSSC. In addition to the Flick family (steel-making cronies of the Thyssens), “American interests” owned part of CSSC. As indicated in the article, CSSC made liberal use of sla

ve labor from the Polish concentration camps. “Thyssen’s partner in United Steel Works, which had coal mines and steel plants across the region, was Friedrich Flick, another steel magnate who also owned part of IG Farben, the powerful German chemical company. Flick’s plants in Poland made heavy use of slave labor from the concentration camps in Poland. According to a New York Times article published in March 18, 1934, Flick owned two-thirds of CSSC while ‘American interests’ held the rest. The US National Archive documents show that BBH’s involvement with CSSC was more than simply holding the shares in the mid-1930’s. Bush’s friend and fellow ‘bonesman’ Knight Woolley, another partner at BBH, wrote to Averill Harriman in January 1933 warning of problems with CSSC after the Poles started their drive to nationalize the plant. ‘The Consolidated Silesian Steel Company situation has become increasingly complicated, and I have accordingly brought in Sullivan and Cromwell, in order to be sure that our interests are protected,’ wrote Knight. ‘After studying the situation Foster Dulles is insisting that their man in Berlin get into the picture and obtain the information which the directors here should have. You will recall that Foster is a director and he is particularly anxious to be certain that there is no liability attaching to the American directors.’” (Idem.)

20. The issue of CSSC, slave labor and the Bush family’s liability for the company’s actions is covered in a book just published in Germany: “But the ownership of the CSSC between 1939 when the Germans invaded Poland and 1942, when the US government vested UBC and SAC is not clear. ‘SAC held coal mines and definitely owned CSSC between 1934 and 1935, but when SAC was vested there was no trace of CSSC. All concrete evidence of its ownership disappears after 1935 and there are only a few traces in 1938 and 1939,’ says Eva Schweitzer, the journalist and author whose book, America and the Holocaust, [Amerika und der Holocaust] is published next month. Silesia was quickly made part of the German Reich after the invasion, but while Polish factories were seized by the Nazis, those belonging to the still neutral Americans (and some other nationals) were treated more carefully as Hitler was still hoping to persuade the US to at least sit out the war as a neutral country. Schweitzer says American interests were dealt with on a case-by-case basis. The Nazis bought some out, but not others.” (Idem.)

21. More about the lawsuit: “The two Holocaust survivors suing the US government and the Bush family for a total of $40 billion in compensation claim both materially benefited from Auschwitz slave labor during the Second World War. Kurt Julius Goldstein, 87, and Peter Gingold, 85, began a class action in America in 2001, but the case was thrown out by Judge Rosemary Collier on the grounds that the government cannot be held liable under the principle of ‘state sovereignty.’ Jan Lissman, one of the lawyers for the survivors, said: ‘President Bush withdrew President Bill Clinton’s signature from the treaty [that founded the court] not only to protect Americans, but also to protect himself and his family.’ Lissman argues that genocide-related cases are covered by international law, which does hold governments accountable for their actions. He claims the ruling was invalid as no hearing took place.” (Ibid.; p. 5.)

22. Basing their lawsuit on an order by President Roosevelt to do everything possible to save European Jews, the plaintiffs contend that BBH and other powerful companies brought pressure to neutralize Roosevelt’s directive. “In their claims, Mr. Goldstein and Mr. Gingold, honorary chairman of the League of Anti-fascists, suggest the Americans were aware of what was happening at Auschwitz and should have bombed the camp. The lawyers also filed a motion in The Hague asking for an opinion on whether state sovereignty is a valid reason for refusing to hear their case. A ruling is expected within a month. The petition to The Hague states: ‘From April 1944 on, the American Air Force could have destroyed the camp with air raids, as well as the railway bridges and railway lines from Hungary to Auschwitz. The murder of about 400,000 Hungarian Holocaust victims could have been prevented.’” (Idem.)

23. “The case is built around a January 22, 1944 executive order signed by President Franklin Roosevelt calling on the government to take all measures to rescue the European Jews. The lawyers claim the order was ignored because of pressure brought by a group of big American companies, including BBH, where Prescott Bush was a director. Lissman said: ‘If we have a positive ruling from the court it will cause [president] Bush huge problems and make him personally liable to pay compensation.’ The US government and the Bush family deny all the claims against them.” (Idem.)

24. “In addition to Eva Schweitzer’s book, two other books are about to be published that raise the subject of Prescott Bush’s business history. The author of the second book, to be published next year, John Loftus, is a former US attorney who prosecuted Nazi war criminals in the 70’s. Now living in St. Petersburg, Florida and earning his living as a security commentator for Fox News and ABC radio. Loftus is working on a novel which uses some of the material he has uncovered on Bush. Loftus stressed that what Prescott Bush was involved in was just what many other American and British businessmen were doing at the time. ‘You can’t Blame Bush for what his grandfather did . . . but what is important is the cover-up, how it could have gone on so successfully for half a century, and does that have implications for us today?’ he said. [Emphasis added.]” (Idem.)

25. Former prosecutor John Loftus negates Bush family apologists who claim the Bushes didn’t know who the ultimate beneficiaries of their actions were: “ ‘This was the mechanism by which Hitler was funded to come to power, this was the mechanism by which the Third Reich’s defense industry was re-armed, this was the mechanism by which Nazi profits were repatriated back to the American owners, this was the mechanism by which investigations into the financial laundering of the Third Reich were blunted,’ said Loftus who is vice-chairman of the Holocaust Museum in St. Petersburg. ‘The Union Banking corporation was a holding company for the Nazis, for Fritz Thyssen,’ said Loftus. ‘At various times, the Bush family has tried to spin it, saying they were owned by a Dutch bank and it wasn’t until the Nazis took over Holland that they realized that now the Nazis controlled the parent company and that is why the Bush supporters claim when the war was over they got their money back. Both the American treasury investigations and the intelligence investigations in Europe completely belie that, it’s absolute horseshit. They always knew who the ultimate beneficiaries were.’” (Ibid.; pp. 5-6.)

26. More about the Bush family’s financial benefit from the UBC liquidation: “ ‘There is no one left alive who could be prosecuted but they did get away with it,’ said Loftus. ‘As a former federal prosecutor, I would make a case for Prescott Bush, his father-in-law (George Walker) and Averill Harriman [to be prosecuted] for giving aid and comfort to the enemy. They remained on the boards of these companies knowing that they were of financial benefit to the nation of Germany. . . .What is also at issue is how much money Bush made from his involvement. His supporters suggest that he had one token share. Loftus disputes this, citing sources in ‘the banking and intelligence communities’ and suggesting that the Bush family, through George Herbert Walker and Pre

scott, got $1.5 million out of the involvement. . .” (Ibid.; p. 6.)

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