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. . . .
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. . . .
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. . . .
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. . . .
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. . . .
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. . . .
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. . .
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. . . .
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. . . .
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.”
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. . . .”
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. . . .
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. . . .
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. . . .
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.)