Recorded Novem­ber 26, 2006 REALAUDIO

Intro­duc­tion: Doc­u­ment­ing neu­tral­iza­tion of the pro­gram to block the Nazi flight cap­i­tal pro­gram dur­ing and after World War II, this pro­gram high­lights the machi­na­tions of Allen Dulles in assur­ing the suc­cess of Oper­a­tion Eagle’s Flight. (Dulles, as well as his brother John Fos­ter, were attor­neys for the pow­er­ful Wall Street law firm Sul­li­van and Cromwell, which was deeply involved with the financ­ing of Nazi Germany.)

Hav­ing played an essen­tial role in financ­ing Nazi cor­po­rate struc­ture, Dulles used his posi­tion as a key agent for the Office of Strate­gic Ser­vices to sub­vert Oper­a­tion Safehaven—the Trea­sury Depart­ment pro­gram designed to block the Nazi cap­i­tal flight. (The OSS was America’s World War II intel­li­gence ser­vice.) After con­duct­ing Oper­a­tion Sunrise–negotiations with the SS in Italy aimed at effect­ing a sep­a­rate peace between the Third Reich and the West­ern allies–Dulles worked with other intel­li­gence vet­er­ans and Wall Street movers and shak­ers to guar­an­tee the con­ti­nu­ity of the inter­na­tional car­tel sys­tem which helped spawn the Third Reich in the first place.

In order to assure the recy­cling of the Third Reich’s stolen wealth out of Europe and then back to Ger­many to effect the “eco­nomic mir­a­cle” of Ger­man recov­ery, Dulles and com­pany cre­ated the World Com­merce Cor­po­ra­tion. In addi­tion, Dulles helped to polit­i­cally reha­bil­i­tate SS gen­eral Karl Wolff, his chief part­ner in the Sun­rise negotiations.

The num­ber two man in the SS, Wolff became a key infor­ma­tion source for John “Frenchy” Grom­bach. A for­mer mil­i­tary intel­li­gence offi­cer, Grom­bach chan­neled polit­i­cal dirt to Sen­a­tor Joseph McCarthy’s anti-communist witch hunts. Among McCarthy’s vic­tims were Trea­sury Depart­ment vet­er­ans such as Harry Dex­ter White, who had worked on Oper­a­tion Safe­haven. With Safe­haven vet­er­ans dis­cred­ited as “com­mies,” the coverup of the Nazi money-go-round was complete.

Pro­gram High­lights Include: The FBI’s doc­tor­ing of the diary of for­mer Sec­re­tary of the Trea­sury Robert Mor­gen­thau (who over­saw Safe­haven); the par­tic­i­pa­tion of key Mor­gan part­ner Edward Stet­tinius in the World Com­merce Cor­po­ra­tion; the sub­ver­sion of Mor­gen­thau aide Lauch­lin Currie’s rep­u­ta­tion dur­ing the McCarthy period; the Wall Street con­nec­tions of Dulles’ col­lab­o­ra­tors in the World Com­merce Cor­po­ra­tion; the post­war career of Dulles’ Sun­rise col­lab­o­ra­tor Lyman Lem­nitzer. For a greater under­stand­ing of the inter­na­tional car­tel sys­tem, its rela­tion­ship to the devel­op­ment of the Third Reich, the Bor­mann flight cap­i­tal pro­gram and the other top­ics dis­cussed in this broad­cast, see—among other programs—FTR#’s 305, 511, 532, as well as the books avail­able on this web­site. Be sure to exam­ine the declas­si­fied doc­u­ments chron­i­cling the Bush family’s involve­ment with Nazi indus­try before, dur­ing and after World War II.

1. Begin­ning with dis­cus­sion of Oper­a­tion Safe­haven, the pro­gram out­lines the Trea­sury Department’s cen­tral role in the attempt at neu­tral­iz­ing the Nazi flight cap­i­tal pro­gram. It was this flight cap­i­tal pro­gram that birthed the Bor­mann net­work, the eco­nomic com­po­nent of the Under­ground Reich.

. . . . As the tide of bat­tle shifted in favor of the Allies in 1943, eco­nomic war­fare goals began to take into account the con­cern that Ger­many would try to hide gold and other assets abroad so they would not be included in war repa­ra­tions and could be used to re-build Axis strength in the post-war period. The spe­cific goals of Safe­haven, as they came to be for­mu­lated in spring 1944, were to restrict and pre­vent Ger­man eco­nomic pen­e­tra­tion beyond Ger­many, to block Ger­many from trans­fer­ring assets to neu­tral coun­tries, to ensure that Ger­man wealth would be acces­si­ble for war repa­ra­tions and for the reha­bil­i­ta­tion of Europe, to make pos­si­ble the return to legal own­ers of prop­er­ties looted from coun­tries once occu­pied by the Ger­mans, and to pre­vent the escape of strate­gic Ger­man per­son­nel to neu­tral havens. The over­all pur­pose was to make it impos­si­ble for Ger­many to start another war. . . .

(“U.S. and Allied Efforts To Recover and Restore Gold and Other Assets Stolen or Hid­den by Ger­many Dur­ing World War”.)

2. Dur­ing Safe­haven, the Depart­ment of Trea­sury was headed by Henry Mor­gen­thau. Mor­gen­thau advo­cated the de-industrialization of Ger­many and saw Safe­haven as the first step in real­iz­ing that goal. How man­i­festly unsuc­cess­ful he was can be eval­u­ated at this point in time.

 . . .Sec­re­tary of the Trea­sury Mor­gen­thau in Sep­tem­ber 1944 put for­ward his plan for the polit­i­cal reform of a defeated Ger­many through pun­ish­ment, par­ti­tion, and pas­tor­al­iza­tion. The rad­i­cal down-scaling of Ger­man econ­omy envis­aged under the Mor­gen­thau Plan would rule out any sub­stan­tial repa­ra­tions to the vic­tors, except what might be obtained from the dis­man­tle­ment of what remained of Ger­man indus­try at the end of the war. While Pres­i­dent Roo­sevelt appeared at first to approve of the Trea­sury plan for a puni­tive peace for Ger­many, and he and Prime Min­is­ter Churchill went some dis­tance in adopt­ing some of its ele­ments dur­ing their wartime meet­ing at Que­bec in Sep­tem­ber 1944, oppo­si­tion devel­oped from Sec­re­tary of War Henry Stim­son who feared it would fos­ter resent­ment in Ger­many and give rise to another war with Ger­many. The State Depart­ment also opposed the pas­tor­al­iza­tion of the Ger­many econ­omy called for in the Trea­sury plan and favored a sys­tem of con­trols that would bring Ger­many into the fam­ily of nations. The State Depart­ment opposed the dein­dus­tri­al­iza­tion of Ger­many, believ­ing rather that Ger­many should have a pos­i­tive role to play in the post­war inter­na­tional econ­omy. The British also opposed the harsh peace plan advo­cated by Morgenthau. . . .

(Idem.)

3. Another of the Trea­sury Depart­ment offi­cials involved with Safe­haven was Harry Dex­ter White, who was a casu­alty of Joe McCarthy’s anti-communist witch hunts.

 . . .To pro­vide Embassies with exper­tise in Safehaven-related issues, on Octo­ber 31, 1944, Trea­sury Sec­re­tary Mor­gen­thau agreed with Trea­sury Gen­eral Coun­sel Joseph O’Connell and Harry Dex­ter White, Direc­tor of Mon­e­tary Research for the Trea­sury Depart­ment, that Treasury-trained finan­cial intel­li­gence offi­cers should be dis­patched to sup­ple­ment the staff of Embassies in response to the increased out­flow of Axis cap­i­tal and goods from the Ger­man Reich to neu­tral havens. . . .

(Idem.)

4. In addi­tion to Harry Dex­ter White, Lauch­lin Cur­rie was another of Morgenthau’s asso­ciates in the unsuc­cess­ful Safe­haven oper­a­tion. Cur­rie, too, was destroyed in the McCarthy period.

 . . .The arrival of the Cur­rie Mis­sion in Bern in Feb­ru­ary 1945 rep­re­sented both a sub­stan­tive and psy­cho­log­i­cal water­shed for the Swiss. Since the Allied land­ings in June 1944, the Ger­man Army had steadily retreated, and for the first time in over four years Switzer­land was not sur­rounded by the Ger­man Army, open­ing the pos­si­bil­ity to expand trade and com­mu­ni­ca­tion with the non-Axis world. The U.S. Lega­tion in Bern judged that pub­lic expec­ta­tions cen­ter­ing on Currie’s visit were bor­der­ing on the fever­ish. . . . Despite offi­cial Swiss con­cern about his mis­sion, Cur­rie was impressed with the pop­u­lar enthu­si­asm that greeted his arrival on the first train to Bern from a recently lib­er­ated Paris. Through­out his stay, in fact, Cur­rie received red car­pet treat­ment, the details of which appeared in much of his cor­re­spon­dence about the Mis­sion. It is likely that the lav­ish Swiss hos­pi­tal­ity afforded Cur­rie and his col­leagues con­tributed, to some degree, to the opti­mistic inter­pre­ta­tion of the mission’s outcome. . . .

(Idem.)

5. Under the aus­pices of Safe­haven, Ger­man indus­trial rep­re­sen­ta­tives in the U.S. and their Amer­i­can col­lab­o­ra­tors were being wire­tapped. Pres­i­dent Roo­sevelt intended to use the infor­ma­tion gleaned from those wire­taps to indict the Nazis’ Amer­i­can indus­trial and finan­cial col­lab­o­ra­tors. Had he been suc­cess­ful in doing so, many of the most promi­nent names in Amer­i­can indus­try and finance would have been con­victed at Nurem­berg, includ­ing the grand­fa­ther and great-grandfather of George Bush! Among those col­lab­o­ra­tors was Allen Dulles, who was cen­trally involved in financ­ing the Third Reich and in help­ing the Nazi flight cap­i­tal pro­gram. (For more about Dulles’ role in help­ing to finance the Third Reich and assist the Nazi flight cap­i­tal pro­gram, see—among other programs—FTR#’s 353, 361, 370, 532.)

 . . . . But the one issue upon which Roo­sevelt was unyield­ing was his insis­tence that after the war, the Ger­man bankers must stand in the dock at the Nurem­berg war crimes trial. This is con­firmed by the top-secret White House-Justice Depart­ment cor­re­spon­dence files. The plan was to wait until Abs, Krupp, Flick, and the rest of the indus­tri­al­ists were charged. Then Mor­gen­thau would unleash the wire­tap Evi­dence show­ing that the Nazis had hid­den their stolen assets in Switzer­land, with the help of Allen Dulles. The whole scan­dal of West­ern aid to the Ger­many econ­omy would unravel. All the slights of the Stan­dard Oil black­mail would be avenged. The sud­den release of the Safe­haven inter­cepts would force a pub­lic out­cry to bring trea­son charges against those British and Amer­i­can busi­ness­men who aided the enemy in time of war. The tar­gets included not only the Dulles broth­ers, but For­re­stal and major indus­tri­al­ists, such as Henry Ford. From a prosecutor’s point of view, indict­ing the Ger­man bankers first was a bril­liant strat­egy. To save them­selves, Her­man Abs and Hjal­mar Schacht would have to reveal the whole his­tory of their sor­did deal­ings with com­pa­nies such as Ford Motor. Despite the shields of Swiss bank­ing laws and the lay­ers of cor­po­ra­tions that Dulles had erected, he had never antic­i­pated that the Swiss bank codes and cables would ever become pub­lic knowl­edge. Roo­sevelt and Mor­gen­thau would have hanged him and all his col­leagues, for­ever break­ing the power of the pirates of inter­na­tional finance. It was a glo­ri­ous dream. Yet the scheme com­pletely fell apart because some­one tipped off Dulles that he was under surveillance. . . .

(The Secret War Against the Jews: How West­ern Espi­onage Betrayed the Jew­ish Peo­ple; John Lof­tus and Mark Aarons; Copy­right 1994 [HC]; St. Martin’s Press; ISBN 0–312-11057-X; pp. 77–78.)

6. Again, Allen Dulles would have been in the defen­dants’ dock at Nurem­berg. Dulles was actively involved with help­ing the Nazis move their money to Argentina.

 . . . Because he learned about the Safe­haven inter­cepts so quickly, Dullest knew that there was no smok­ing gun against him. His work for the Nazis prior to the war was not ille­gal, let alone trea­so­nous. His wartime com­mu­ni­ca­tions with the Nazis, although highly embar­rass­ing, could be excused as an exer­cise in decep­tion or as part of his intrigues to over­throw Hitler. Although many of his wartime actions were unau­tho­rized, they were not crim­i­nal. What was crim­i­nal was the way that Dulles was try­ing to help the Ger­man indus­tri­al­ists get their money out at the end of the war. After the Nazis’ 1943 defeat at Stal­in­grad, var­i­ous Nazi busi­ness­men real­ized they were on the los­ing side and made plans to evac­u­ate their wealth. The Peron gov­ern­ment in Argentina was receiv­ing the Nazi flight cap­i­tal with open arms, and Dulles helped it hide the money. This was more than a vio­la­tion of the Trad­ing with the Enemy Act; giv­ing aid and com­fort to the enemy in time of war was trea­son. Once again, how­ever, Alien Dulles was one step ahead of his pursuers. . . .

(Ibid.; p. 79)

7. Note that the Vat­i­can helped Dulles move the Nazi money out of Europe and that the Nazi cap­i­tal helped the Argen­tine econ­omy soar.

. . . Dulles rep­re­sented a stag­ger­ing array of Argen­tine cor­po­rate and polit­i­cal enti­ties before and after the war. Pres­i­dent Juan Peron and his fam­ily were ardent Catholics and vio­lently anti-Communist, as were many Argen­tines. In fact, Peron was decid­edly pro-Fascist and Argentina was the only South Amer­i­can coun­try that con­tin­ued rela­tions with the Third Reich well into the war. The Argen­tine econ­omy boomed with the mas­sive post­war trans­fer of Nazi flight capital. . . .

(Ibid.; p. 110.)

8. “ . . . Soon after the Safe­haven inquiry into his own Nazi money smug­gling was buried, Allen Dulles resigned from the OSS and returned to New York to do what he did best: move money ille­gally for his clients. One of the first names on his client list was a ‘per­sonal mat­ter’ for Thomas McKit­trick, the head of the pre­vi­ously Nazi-dominated Bank of Inter­na­tional Set­tle­ments (BIS) in Switzer­land. The BIS had over­seen the trans­fer of Nazi assets to Switzer­land. After the war, the Nazis moved the money via the Vat­i­can to Argentina. . . .”

(Ibid.; pp. 83–84.)

9. “ . . . . Dulles rep­re­sented a stag­ger­ing array of Argen­tine cor­po­rate and polit­i­cal enti­ties before and after the war. Pres­i­dent Juan Peron and his fam­ily were ardent Catholics and vio­lently anti-Communist, as were many Argen­tines. In fact, Peron was decid­edly pro-Fascist and Argentina was the only South Amer­i­can coun­try that con­tin­ued rela­tions with the Third Reich well into the war. The Argen­tine econ­omy boomed with the mas­sive post­war trans­fer of Nazi flight capital. . . .”

(Ibid.; p. 110.)

10. In order to cir­cum­vent Safe­haven, pro­tect the Nazi cap­i­tal flight and, ulti­mately re-finance the Ger­man econ­omy, Dulles recruited William Dono­van, head of the OSS, America’s World War II intel­li­gence ser­vice. Very closely iden­ti­fied with the Mor­gan inter­ests, Dono­van col­lab­o­rated with Dulles in the World Com­merce Cor­po­ra­tion, one of the pri­mary vehi­cles for effect­ing the Nazi “money-go-round”.

. . . The ‘old spies’ say that Dulles did not have to try very hard to con­vince Dono­van that Tru­man was an idiot and that the only hope for the revival of an Amer­i­can intel­li­gence ser­vice was to end the Demo­c­ra­tic party’s stran­gle­hold on the White House in the 1948 elec­tion. In the mean­time, Dulles and Dono­van agreed that every effort must be made to sab­o­tage the Tru­man lib­er­als and qui­etly pre­pare for the Cold War. To this end, Dulles con­vinced Dono­van to serve on the board of a com­pany that would help rebuild the Ger­man econ­omy as a bul­wark against com­mu­nism. Dulles assured his old boss that there were a large num­ber of wealthy South Amer­i­can investors, espe­cially in Argentina, who were will­ing to help rebuild Ger­many. Although Dono­van did not know it, Dulles had conned him into serv­ing as the front man for the Nazi money laun­der­ers. He and Sir William Stephen­son from British intel­li­gence joined the board of direc­tors of the World Com­merce Cor­po­ra­tion, with Allen Dulles, nat­u­rally, as their lawyer. The Nazi money flowed in a great circle—out of the Third Reich, through the Vat­i­can, to Argentina, and back to ‘demo­c­ra­tic’ West Ger­many. The source of the mirac­u­lous West Ger­man eco­nomic revival in the 1950’s was the same money that had been stolen in the 1940’s. . . .

(Idem.)

11. Note that the efforts of Dulles, Dono­van and the World Com­merce Cor­po­ra­tion were essen­tial to the eco­nomic recon­struc­tion of Ger­many. Note also, that the investors in the Ger­man corporations—including the Wall Street high-rollers that Roo­sevelt wanted to pros­e­cute at Nuremberg–benefited from the inter­dic­tion of Oper­a­tion Safehaven.

 . . . Few who watch the film Evita would rec­og­nize that the Peron fam­ily of Argentina worked directly with the Croa­t­ian Ustashi to estab­lish a pipeline from the Vat­i­can Bank. As recounted ear­lier in this book, Ante Pavelic him­self, the Croa­t­ian Nazi leader, moved to Buenos Aires and became a ‘secu­rity adviser’ to the Per­ons. Laun­dered through the ‘untrace­able’ Vat­i­can Bank, the Nazi trea­sure moved from Switzer­land to South Amer­ica. There the stolen funds were invested in a num­ber of Argen­tine busi­nesses whose lawyer was, of course, Allen Dulles. As the final act of the money laun­der­ing, Dulles cre­ated the World Com­merce Cor­po­ra­tion to revive trade between Argentina and West Ger­many. On its board were such nota­bles as William Dono­van of US intel­li­gence, and William Stephen­son of British intel­li­gence. Dur­ing the 1950’s, much of the stolen pro­ceeds were laun­dered back to Ger­many for the great eco­nomic revival of West Ger­many. In the end, the money went back to the orig­i­nal Ger­man com­pa­nies and their West­ern investors. . . .

(Unholy Trin­ity: The Vat­i­can, the Nazis and the Swiss Banks; by John Lof­tus and Mark Aarons; St. Martin’s Press [SC]; Copy­right 1991, 1998 by Mark Aarons and John Lof­tus; ISBN 0–312-18199; p. 300.)

12. In his efforts on behalf of the Bor­mann cap­i­tal net­work, Dulles was able to draw on the resources of Frank Wis­ner, who became a Deputy Direc­tor of the CIA. Wis­ner, an OSS vet­eran like Dulles and Dono­van, had been a part­ner in the pow­er­ful Wall Street law firm of Carter, Led­yard and Mil­burn. (At one point Carter, Led­yard and Milburn—which was the legal coun­sel for the New York Stock Exchange—had two alumni as Deputy Direc­tors of the CIA. Wis­ner was joined by Hard­ing Jackson.)

 . . . The most impor­tant front group was an entity called the World Com­merce Cor­po­ra­tion estab­lished after World War II to rebuild German—South Amer­i­can trade net­works. The direc­tors of this cor­po­ra­tion were Sir William Stephen­son, for­merly of British intel­li­gence and Gen­eral William Dono­van, for­merly of the OSS. One of the attor­neys for World Com­merce was Allen Dulles, whose assis­tant, Frank Wis­ner, was the State Department’s deputy for cur­rency and eco­nomic reform in the Amer­i­can Sec­tor of West Ger­many. Many of the staff mem­bers for the eco­nomic recon­struc­tion of occu­pied Ger­many came from the same inter­na­tional finan­cial firms which had invested heav­ily in the pre-war Ger­man economy. . . .

(Ibid.; p. 278.)

13. Fur­ther under­scor­ing the cor­po­ratist ele­ment in the inter­dic­tion of Safe­haven is the fact that Edward Stet­tinius joined Dulles and Dono­van on the World Com­merce Cor­po­ra­tion. Stet­tinius was a key Mor­gan part­ner and for­mer Sec­re­tary of State.

 . . . Osten­si­bly to pro­mote recov­ery he [Dono­van], William Stephen­son, and Edward Stet­tinius, along with mem­bers of the Lon­don Ham­bro fam­ily and quite a del­e­ga­tion of other at-large bigshots, had started up the World Com­merce Cor­po­ra­tion, a Panama-registered entity which seemed to fall some­where between an import-export com­bine and a com­mer­cially ori­ented espi­onage net­work. Pri­mary among its func­tions would seem to have been the reequip­ping and upgrad­ing of the Ger­man indus­trial plant. . .

(The Old Boys: The Amer­i­can Elite and the Ori­gins of the CIA; Bur­ton Hersh; Charles Scribner’s Sons [HC]; Copy­right 1992 by Bur­ton Hersh; IBN 0–684-19348–5; p. 229.)

14. The title of the broad­cast derives from Oper­a­tion Sun­rise, an attempt by Dulles to nego­ti­ate a sep­a­rate sur­ren­der of Nazi forces in Italy. In and of itself a vio­la­tion of the pro­to­cols of the Grand Alliance that joined the USSR, U.S. and U.K. against the Axis, Oper­a­tion Sun­rise helped to drive a wedge between the U.S. and the Sovi­ets. Sun­rise appears to have been a key fac­tor in pre­cip­i­tat­ing the Cold War. Dulles’ key nego­ti­at­ing part­ner on the other side was Gen­eral Karl Wolff, Himmler’s per­sonal adju­tant and the num­ber two man in the SS. As we will see, Wolff was later to con­tribute to the McCarthy anti-communist witch hunts that, among other things, helped to dis­credit vet­er­ans of the Safe­haven pro­gram by tar­ring them with the “com­mie brush.” Among those who sup­ported exclud­ing the Sovi­ets from the Sun­rise nego­ti­a­tions was Averell Har­ri­man, the U.S. ambas­sador the Soviet Union. Har­ri­man was a part­ner of the Bush fam­ily in their busi­ness deals with the Nazis.

. . . When Dulles opened con­tacts with Wolff in early 1945, the British mil­i­tary com­mand in Italy noti­fied the Sovi­ets that new peace nego­ti­a­tions had begun for a rapid Ger­man sur­ren­der of north­ern Italy. The Sovi­ets replied that they were glad to hear this; all that was required under stand­ing Allied agree­ments on nego­ti­a­tions with the enemy was for a hand­ful of senior Soviet mil­i­tary rep­re­sen­ta­tives to mon­i­tor the progress of the talks. The U.S. ambas­sador to Moscow, Averell Har­ri­man, vetoed that. Invit­ing the Sovi­ets to the nego­ti­a­tions would make the Ger­mans ner­vous, he con­tended, and would only encour­age the Sovi­ets to insist on par­tic­i­pa­tion in other upcom­ing deci­sions about the for­mer Axis ter­ri­to­ries already held by U.S. and British troops. His was one of the most impor­tant voices on U.S.-Soviet rela­tions, and his opin­ion car­ried the day. . . .

(The Splen­did Blonde Beast: Money, Law and Geno­cide in the Twen­ti­eth Cen­tury; Christo­pher Simp­son; Com­mon Courage Press [SC]; Copy­right 1995 by Christo­pher Simp­son; ISBN 1–5671-062–0 [paper]; p. 202.)

15. Among the mil­i­tary nego­tia­tors allied with Dulles was Lyman Lem­nitzer, who was to become a char­ac­ter wit­ness for Wolff after the war and, even­tu­ally, Chair­man of the Joint Chiefs of Staff. He was Chair­man of the Joint Chiefs when John F. Kennedy became Pres­i­dent. (Lis­ten­ers famil­iar with Oper­a­tion North­woods should note that that pro­gram was devel­oped under Lem­nitzer. For more about North­woods, see FTR#363.)

. . . .Roo­sevelt and Stalin exchanged increas­ingly bit­ter notes as nego­ti­a­tions con­tin­ued in Switzer­land among Dulles, the SS rep­re­sen­ta­tives, and a crew of senior U.S. mil­i­tary offi­cers that included Major Gen­eral Lyman Lem­nitzer and Gen­eral Hoyt Van­den­berg. A week after the talks began, Soviet For­eign Min­is­ter Molo­tov sent a note to Har­ri­man in Moscow express­ing ‘com­plete sur­prise’ that Soviet rep­re­sen­ta­tives were still barred from the talks. He said that the sit­u­a­tion was ‘inex­plic­a­ble in terms of the rela­tions of alliance’ between the U.S. and the USSR.’ If the U.S. refused to per­mit Soviet rep­re­sen­ta­tives to par­tic­i­pate, Molo­tov con­tended, the talks had to be abandoned. . . .

(Idem.)

16. In the text excerpts that fol­low, note the role of the Sun­rise nego­ti­a­tions in exac­er­bat­ing fric­tion between the U.S. and the Soviets.

. . . Roo­sevelt wrote directly to Stalin a few days later. The USSR mis­un­der­stood what was tak­ing place, he insisted. The talks in Italy were basi­cally a local mat­ter, com­pa­ra­ble to that in which the Baltic coast cities of Konigs­berg and Danzig had ear­lier sur­ren­dered to the Sovi­ets. Roo­sevelt seemed to approve Soviet partici­pation in the talks (‘I will be pleased to have at any dis­cus­sion of the details of sur­ren­der . . . the ben­e­fit of the expe­ri­ence and advice of any of your offi­cers who can be present. . .’), but he insisted that the talks in Switzer­land were an ‘inves­ti­ga­tion’ of a local Ger­man commander’s sur­ren­der offer, not a ‘nego­ti­a­tion.’ Time was of the essence, he con­tin­ued, and the U.S. rep­re­sen­ta­tives could not be faulted for being eager to accept the sur­ren­der of the Ger­man troops they were fac­ing on the battlefield. . . .

(Ibid.; p. 203.)

17. “Stalin esca­lated the argu­ment. His for­eign min­is­ter, Molo­tov, sud­denly had new com­mit­ments in Moscow and would not attend the found­ing of Roosevelt’s most cher­ished post­war project, the United Nations Orga­ni­za­tion. This was a cal­cu­lated slight, and both sides knew it. In a new note to FDR, Stalin replied that he was all for prof­it­ing from cases of dis­in­te­gra­tion in the Ger­man armies,’ but in this case, the Ger­mans were using the talks to ‘maneu­ver’ and to trans­fer troops from Italy to the East­ern Front.’ Roo­sevelt replied that Soviet actions in Poland and Roma­nia had not lived up to the com­mit­ments made at the Yalta Con­fer­ence less than two months pre­vi­ously. U.S.-Soviet rela­tions had moved rapidly to an ‘atmos­phere of regret­table appre­hen­sion and mis­trust’ owing to the con­fronta­tion over Dulles’s talks with the SS, Roo­sevelt com­mented, and again insisted to Stalin that the talks were for ‘the sin­gle pur­pose of arrang­ing con­tact with com­pe­tent Ger­man mil­i­tary offi­cers and not for nego­ti­a­tions of any kind.’ Mean­while, FDR cabled Dulles in Switzer­land and ordered him to present the SS rep­re­sen­ta­tives with a take-it-or-leave-it offer of an uncon­di­tional sur­ren­der. No fur­ther nego­ti­a­tion would be per­mit­ted, the Pres­i­dent said. Stalin seemed to know many of the details of the Dulles-SS talks even before Roo­sevelt did.

When FDR tried to soothe Stalin with a dec­la­ra­tion that the Swiss talks were with­out polit­i­cal sig­nif­i­cance, Stalin shot back that ‘appar­ently you are not fully informed.’ Stalin’s mil­i­tary intel­li­gence agents in Switzer­land were ‘sure that nego­ti­a­tions did take place and that they ended in an agree­ment with the Ger­mans, whereby the Ger­man com­man­der on the West­ern Front, Mar­shal Kessel­ring, is to open the front to the Anglo-American troops and let them move east, while the British and Amer­i­cans have promised, in exchange, to ease the armistice terms for the Ger­mans. I think my col­leagues are not very far from the truth,’ he con­tin­ued. If this per­cep­tion was wrong, he asked, why were his men still being excluded from the talks? . . .”

(Ibid.; pp. 203–204.)

18. Note that Stalin was right—Dulles and crew were indeed attempt­ing to nego­ti­ate a sep­a­rate peace with the Third Reich, in vio­la­tion of the pro­to­cols that gov­erned the alliance between the Sovi­ets, the U.S. and the United King­dom. Note also that Roo­sevelt died at this time. Although it is not dis­cussed in detail, Roo­sevelt died while hav­ing his por­trait painted by some White (anti-communist) Rus­sians, who didn’t even wait to learn of Roosevelt’s fate after his col­lapse. Nazi astrologers had pre­dicted that the date on which Roo­sevelt died would see a change in the Nazi for­tunes. Mr. Emory does not believe in astrol­ogy and feels that the Nazi astrologers may well have been pro­vid­ing a pro­pa­ganda assist to the Nazi faith­ful in antic­i­pa­tion of an attempt on Roosevelt’s life.

. . . .Stalin may have over­stated his case, but he was not far off. These were in fact exactly the terms that Car­di­nal Schus­ter had pro­posed and that Dulles had dis­cussed with Wolff. No final deal had been struck, though, and by early April both sides in Switzer­land were once again seek­ing guid­ance from their respec­tive home offices. By then, though, the Ger­man front had begun to col­lapse through­out Europe, the Red Army was at the gates of Berlin, and Dulles’s grand plan to take Cen­tral Europe by way of Tri­este had failed. ‘The Bern inci­dent,’ as Roo­sevelt described it in a last let­ter to Stalin writ­ten only hours before his death, ‘. . . now appears [to have] faded into the past with­out hav­ing accom­plished any use­ful purpose.’ . . .

(Ibid.; p. 204.)

19. Observers and par­tic­i­pants in the Sun­rise nego­ti­a­tions came away con­vinced that Dulles had reached an accord with Wolff and his SS coun­ter­parts. As will be seen below, they were right.

. . . But FDR’s ban on a for­mal agree­ment did not pre­clude Dulles from mak­ing more lim­ited ‘gentlemen’s agree­ments’ with his SS coun­ter­parts for con­ces­sions that he saw as advan­ta­geous to the OSS or to U.S. geopo­lit­i­cal strat­egy. The SS del­e­ga­tion, the Swiss intel­li­gence envoys who were serv­ing as go-betweens, and the Soviet agents secretly mon­i­tor­ing the talks each came away from the talks con­vinced that Dulles had agreed to pro­vide pro­tec­tion and assis­tance to Gen­eral Wolff and his SS entourage in exchange for a quick sur­ren­der of Ger­man troops in Italy, although Dulles would deny this later. . . .

(Idem.)

20. Indi­cat­ing the trea­so­nous nature of Dulles’ activ­i­ties is the fact that he con­tin­ued the Sun­rise nego­ti­a­tions even after being ordered to break them off. It was the view of Dulles’ supe­ri­ors that Wolff’s efforts were an attempt at split­ting the alliance. They were right. Dulles was doing the same thing.

. . . Wolff’s ulti­mately empty promises of a dra­matic Ger­man sur­ren­der that would advance U.S. and British forces far to the east cap­ti­vated Dulles and his OSS col­leagues in Switzer­land. Dulles inter­vened on a half-dozen occa­sions in an effort to keep the Oper­a­tion Sun­rise nego­ti­a­tions on track, even after the joint U.S.–British mil­i­tary com­mand in Italy ordered him to desist. By the last week of April, senior U.S. and British mil­i­tary com­man­ders in Italy con­cluded that the Sun­rise project was lit­tle more than a des­per­ate SS effort to frac­ture Allied unity, and told Dulles to cut off all con­tact with Wolff and his emis­saries. Nev­er­the­less, Dulles’s top aide Gero von Gaever­nitz kept the nego­ti­a­tions open and acted with Dulles’s tacit coop­er­a­tion to res­cue Wolff from Ital­ian par­ti­sans. The U.S.-British Com­bined Chiefs of Staff are known to have opened an inves­ti­ga­tion into Dulles’s alleged dere­lic­tion of duty and refusal to obey orders in con­nec­tion with the Wolff res­cue, but the records of this inquiry have dis­ap­peared from OSS and mil­i­tary files and have yet to be rediscovered. . . .

(Ibid.; pp. 204–205.)

21. “The unof­fi­cial truce in Italy that took hold as the nego­ti­a­tions went on prob­a­bly saved lives, if only because ground com­bat is so bru­tal that even a few hours’ respite can reduce casu­al­ties. But Roosevelt’s con­clu­sion that the nego­ti­a­tions failed to achieve a gen­uine Ger­man sur­ren­der in Italy is accu­rate. As a prac­ti­cal mat­ter, Oper­a­tion Sun­rise con­tributed con­sid­er­ably more to sour­ing U.S.-Soviet rela­tions, and to enhanc­ing Alien Dulles’s care­fully cul­ti­vated rep­u­ta­tion as a spy­mas­ter, than it ever did to win­ning the war in Europe. [Empha­sis added.] Mak­ing use of splits in the enemy camp is, of course, among the most basic mil­i­tary tac­tics, and fun­da­men­tal to almost any effort to recruit spies. But Oper­a­tion Sun­rise was seri­ously coun­ter­pro­duc­tive from strate­gic and polit­i­cal points of view. The U.S. and its allies had for­mally agreed to forgo use of sep­a­rate peace nego­ti­a­tions with the Ger­mans in order to more fully ensure the solid­ity of their coali­tion. That pol­icy did not make rela­tions with the Ger­mans eas­ier, obvi­ously, but any other approach would likely have facil­i­tated Hitler’s cen­tral strat­egy and last hope in the final years of the war, which was to con­quer the Allies by divid­ing them. Roosevelt’s demand for an uncon­di­tional sur­ren­der had not sprung from na’ivete or starry-eyed ide­al­ism, as some crit­ics have argued, but rather from a tough-minded appraisal of just how much blood would be required to defeat the Axis. The unconditional-surrender pol­icy did not ‘cost’ U.S. lives; it saved them, per­haps by the hun­dreds of thou­sands, by guar­an­tee­ing that the Soviet Union would carry most of the weight in the war against Hitler.”

(Ibid.; p.205.)

22. The begin­ning of a sym­bi­otic rela­tion­ship, Sun­rise became the point of depar­ture for a col­lab­o­ra­tive rela­tion­ship between Dulles, Wolff and Lemnitzer.

 . . . The more sophis­ti­cated Axis defen­dants soon learned how to make the most of the divi­sions among the Allies. The post­war careers of the SS men who had nego­ti­ated with Alien Dulles dur­ing Oper­a­tion Sun­rise pro­vide an exam­ple of how sym­bi­otic rela­tion­ships evolved among the vic­tors and the van­quished dur­ing the first years after the war. The Dulles case is inter­est­ing not only because it was typ­i­cal of thou­sands of less promi­nent instances, but also because of the sym­me­try in Dulles’s behav­ior in the wake of two dif­fer­ent genocides—the Armen­ian Geno­cide and the Nazi Holocaust—more than two decades apart. . . .

(Ibid.; p. 236.)

23. “ . . . Though Dulles was later to deny it, he extended de facto pro­tec­tion to Karl Wolff and at least two of his assis­tants, Eugen Doll­mann and Eugen Wen­ner, both of whom were later indicted by Ital­ian author­i­ties for their roles in mas­sacres of Ital­ian par­ti­sans and depor­ta­tion of Ital­ian Jews to Auschwitz. Cir­cum­stan­tial evi­dence links Dulles to the escape of another of Wolff’s assis­tants, Wal­ter Rauff, whose rise through SS ranks had been helped by his use of gas trucks to mur­der thou­sands of Jew­ish women and chil­dren on the East­ern Front. . . .”

(Idem.)

24. Dulles and Lem­nitzer were char­ac­ter wit­nesses for Wolff at a de-Nazification pro­ce­dure. Their tes­ti­mony pre­pared the way for Wolff to become a col­lab­o­ra­tor with ele­ments of West­ern intelligence.

 . . . In late 1949, the British brought Karl Wolff before a denaz­i­fi­ca­tion board (not an Allied court) in Hamburg—a move that might be fairly com­pared to charg­ing the SS leader with traf­fic vio­la­tions. Wolff’s Sun­rise col­leagues turned out in force for the ‘denaz­i­fi­ca­tion.’ Allen Dulles, Lyman Lem­nitzer, and Gen­eral Ter­rence Airey each sub­mit­ted an affi­davit on Wolff’s behalf to the Ger­man panel; Dulles’s senior aide, Gero von Gaever­nitz, tes­ti­fied in per­son as a defense wit­ness. The board delib­er­ated briefly, deter­mined that the Karl Wolff in the dock was in fact the well-known Nazi and SS leader, then went on to con­clude that the time Wolff had served in Allied intern­ment since the war had been pun­ish­ment enough. Karl Wolff was free to go. . . .

(Ibid.; p. 242.)

25. “ . . . Offi­cially, the United States, Britain, and the USSR for­mally agreed at the Pots­dam Con­fer­ence dur­ing the sum­mer of 1945 to a tough pro­gram of demil­i­ta­riza­tion, decen­tral­iza­tion, and denaz­i­fi­ca­tion of Ger­many in gen­eral and of the Ger­man econ­omy in par­tic­u­lar. They also spec­i­fied that Ger­many would pay sub­stan­tial war repa­ra­tions to the coun­tries it had dam­aged. The Wolff and Hor­thy cases sug­gest that despite such pub­lic covenants, clan­des­tine fac­tions inside West­ern gov­ern­ments already enjoyed suf­fi­cient clout in the late 1940s to effec­tively derail pros­e­cu­tion of Nazi crim­i­nals, includ­ing those of very high rank, at least in cer­tain cir­cum­stances. But this pat­tern of com­fort extended to those who had once orga­nized geno­cide was not sim­ply some plot by insid­ers. It was, as will be seen, a struc­tural prob­lem, one that extended de facto amnesties to thou­sands of men and women who had pro­moted or prof­ited from mass murder. . . .”

(Ibid.; p. 244.)

26. Even­tu­ally, the reha­bil­i­tated Wolff began feed­ing infor­ma­tion to “Frenchy” Grom­bach, a for­mer mil­i­tary intel­li­gence agent who formed a net­work of oper­a­tives who fed infor­ma­tion to the CIA, among oth­ers. As indi­cated here, one of Grombach’s major sources in his efforts was Wolff.

 . . . One of Grombach’s most impor­tant assets, accord­ing to U.S. naval intel­li­gence records obtained under the Free­dom of Infor­ma­tion Act, was SS Gen­eral Karl Wolff, a major war crim­i­nal who had gone into the arms trade in Europe after the war. . . . Grom­bach worked simul­ta­ne­ously under con­tract to the Depart­ment of State and the CIA. The ex-military intel­li­gence man suc­ceeded in cre­at­ing ‘one of the most unusual orga­ni­za­tions in the his­tory of the fed­eral gov­ern­ment,’ accord­ing to CIA Inspec­tor Gen­eral Lyman Kirk­patrick. ‘It was devel­oped com­pletely out­side of the nor­mal gov­ern­men­tal struc­ture, [but it] used all of the nor­mal cover and com­mu­ni­ca­tions facil­i­ties nor­mally oper­ated by intel­li­gence orga­ni­za­tions, and yet never was under any con­trol from Wash­ing­ton.’ By the early 1950s the U.S. gov­ern­ment was bankrolling Grombach’s under­ground activ­i­ties at more than $1 mil­lion annu­ally, Kirk­patrick has said. . . .

(Blow­back; Christo­pher Simp­son; Col­lier [Macmil­lan] {SC}; Copy­right 1988 by Christo­pher Simp­son; ISBN 0–02-044995-X; p. 236.)

27. Among the pri­mary recip­i­ents of Grombach’s and Wolff’s infor­ma­tion was Sen­a­tor Joseph McCarthy, who uti­lized dirt given him by the net­work to smear his oppo­nents. Among those who were trashed dur­ing the McCarthy period were peo­ple involved with Safehaven.

. . . Grom­bach banked on his close con­nec­tions with Sen­a­tors Joseph McCarthy, William Jen­ner, and other mem­bers of the extreme Repub­li­can right to pro­pel him to national power. . . .Grombach’s out­fit effec­tively became the for­eign espi­onage agency for the far right, often serv­ing as the over­seas com­ple­ment to McCarthy’s gen­er­ally warm rela­tions with J. Edgar Hoover’s FBI at home . . . . U.S. gov­ern­ment con­tracts bankrolling a net­work of for­mer Nazis and col­lab­o­ra­tors gave him much of the ammu­ni­tion he needed to do the job. Grom­bach used his net­works pri­mar­ily to gather dirt. This was the Amer­i­can agent’s spe­cialty, his true pas­sion: polit­i­cal dirt, sex­ual dirt, any kind of com­pro­mis­ing infor­ma­tion at all. ‘He got into a lot of garbage pails,’ as Kirk­patrick puts it, ‘and issued ‘dirty linen’ ‘reports on Amer­i­cans. ‘Grom­bach col­lected scan­dal, cat­a­loged it, and used it care­fully, just as he had done dur­ing the ear­lier McCor­mack inves­ti­ga­tion. He leaked smears to his polit­i­cal allies in Con­gress and the press when it suited his pur­poses to do so. Grom­bach and con­gres­sional ‘inter­nal secu­rity’ inves­ti­ga­tors bartered these dossiers with one another almost as though they were boys trad­ing base­ball cards. . . .

(Ibid.; p. 237.)

28. Part of the inter­dic­tion of Safe­haven was the destruc­tion of the pro­fes­sional rep­u­ta­tions of those involved with the effort. As we have seen, Joe McCarthy, Karl Wolff, Grom­bach and com­pany were deeply involved in the anti-communist witch hunts. Harry Dex­ter White was among the Safe­haven vet­er­ans who had their rep­u­ta­tions destroyed by McCarthy. Dis­cussing McCarthy’s tar­gets, Fred Cook men­tioned the fate of White:

. . . What had they estab­lished in that time, at least to their own sat­is­fac­tion? That out of a total of 2.5 mil­lion fed­eral employ­ees, only some seventy-five could even be accused of com­mu­nist activ­i­ties. Of this minis­cule num­ber, two, Harold Ware and Harry Dex­ter White, had died. . . .

(The Night­mare Decade; Fred Cook; Ran­dom House [HC]; Copy­right 1971 by Fred Cook; ISBN 0–394-46270-X; p. 547.)

29. Like Dex­ter White, Safe­haven vet­eran Lauch­lin Cur­rie had his career destroyed in the McCarthy period. McCarthy suc­cess­fully tarred State Depart­ment offi­cial Owen Lat­ti­more by not­ing that Lat­ti­more had edited some of Currie’s cor­re­spon­dence. (Note that Mr. Emory is skep­ti­cal of “dis­clo­sures” in the 1990’s of Currie’s alleged spy­ing for the Sovi­ets. Note the alter­ation of for­mer Trea­sury Sec­re­tary Morgenthau’s diaries, dicussed below. There has been a vig­or­ous effort at re-writing his­tory, and Mr. Emory sus­pects that the accu­sa­tions against Cur­rie may be part of this.)

 . . . Here are to be found only the puny charges that he [Lat­ti­more] know­ingly denied . . . (5) that in 1942 he was requested to and did take care of the cor­re­spon­dence of Lauch­lin Cur­rie while Cur­rie was away on a trip . . . .

(Ibid.; pp. 376–377.)

30. Among the events that may have helped to bury his­tory is the FBI’s doc­tor­ing of Robert Morgenthau’s diaries. Recall that Mor­gen­thau was Trea­sury Sec­re­tary and Safe­haven was ini­ti­ated under his juris­dic­tion. Recall, also, that Mor­gen­thau favored the com­plete de-industrialization of Ger­many. Might Hoover’s agents have altered infor­ma­tion relat­ing to Safehaven?

 . . . Hoover was not only deter­mined to manip­u­late the news, decid­ing what the pub­lic should or should not know; he also altered his­tory, in the process exact­ing revenge against one of his most hated ene­mies, ‘that Jew in the Trea­sury,’ Henry Mor­gen­thau, Jr. Dur­ing his nearly dozen years as sec­re­tary of the trea­sury (1934—45), Mor­gen­thau kept a daily diary, which included not only his own rec­ol­lec­tions of events but also ver­ba­tim tran­scrip­tions of his meet­ings and tele­phone calls. More­over, as a mem­ber of FDR’s ‘inner cab­i­net,’ he was privy to the behind-the-scenes activ­i­ties of most of the rest of the government.

Accord­ing to the his­to­rian Jason Berger, it would be dif­fi­cult to over­state the impor­tance of the Mor­gen­thau diaries to schol­ars of the New Deal era. As ‘the only source of daily hap­pen­ings in Wash­ing­ton,’ Berger notes, ‘they are a researcher’s dream.’ For writ­ers rang­ing from Arthur M. Schlesinger, Jr., to Ted Mor­gan, they have been an indis­pens­able source of raw his­tory. On leav­ing office, Mor­gen­thau had given his papers to the National Archives for safe­keep­ing until such time as he decided to make them pub­lic. On learn­ing, in 1951, that Mor­gen­thau was dis­cussing pub­li­ca­tion of the diaries, Hoover struck. . . .

(J. Edgar Hoover: The Man and His Secrets; Copy­right 1991 by Curt Gen­try; Plume [Pen­guin Group] {SC}; ISBN 0–452-26904–0; p. 389.)

31. In addi­tion to re-writing his­tory through the doc­tor­ing of Morgenthau’s diaries, it appears that oper­a­tives may have doc­tored other mem­oirs of U.S. politi­cians. How many other politi­cians have had their mem­oirs doc­tored? How many gov­ern­ment agen­cies beside the FBI have been involved in such operations?

. . . ‘It was a very covert oper­a­tion,’ a senior agent who headed the raid­ing party has recalled, ‘damn covert. There were five of us, and we were all sworn to absolute secrecy. We even left the Wash­ing­ton field office by var­i­ous devi­ous routes. And we’d go in [an out-of-the-way room at the National Archives] at dif­fer­ent times so no one would know five agents were in that room. And we were the only ones who had a key.’ Their only equip­ment, which they car­ried in their brief­cases, was scis­sors. ‘We lit­er­ally went through [the diary] with scis­sors, cut­ting out any ref­er­ences which would be unfa­vor­able to Mr. Hoover or the FBI. They were just phys­i­cally excerpted right out of the diary itself.

Our job was to cut out every­thing which, even by innu­endo, might indi­cate that Mr. Hoover had feet of clay.’ The pages were then retyped and renum­bered so that there would be no indi­ca­tion that any­thing was miss­ing. The whole oper­a­tion took sev­eral weeks. What they left behind for the his­to­ri­ans who fol­lowed was a his­tory of the New Deal years as approved by J. Edgar Hoover. Although he was not per­son­ally involved, the senior agent heard from the Bureau grapevine that Pres­i­dent Roosevelt’s papers had been sim­i­larly ‘san­i­tized.’ Accord­ing to librar­i­ans at the Franklin D. Roo­sevelt Library at Hyde Park, New York, many FBI reports are miss­ing. And still oth­ers have been changed. . . .

(Ibid.; pp. 389–90.)

32. Although the infor­ma­tion is not in the body of the actual broad­cast, it is inter­est­ing to con­tem­plate the evo­lu­tion of the milieu that blocked Oper­a­tion Safe­haven. Dulles became direc­tor of the CIA under Eisen­hower, while his brother John Fos­ter became Sec­re­tary of State. [John Fos­ter Dulles, like Allen, was a part­ner in Sul­li­van and Cromwell, the influ­en­tial Wall Street law firm that played a promi­nent role in U.S. invest­ment in the Third Reich.] Lyman Lem­nitzer became Chair­man of the Joint Chiefs of Staff. Wis­ner became a Deputy Direc­tor of the CIA. With the excep­tion of John Fos­ter Dulles (who died in the late 1950’s) all of these peo­ple were in office when Kennedy became Pres­i­dent, after defeat­ing Richard Nixon, who was part of the same milieu. Nixon, a pro­tégé of Allen Dulles, presided over the Cru­sade for Free­dom, which brought Nazi war crim­i­nals into the U.S. for polit­i­cal pur­poses. (For more about the Cru­sade for Free­dom, see—among other programs—FTR#465.)