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“Enthusiastic Hitlerite” Eleanor–The Third Side of The Dulles Iron Triangle

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EleanorDullesGraveDerFuehrerCOMMENT: We have chronicled the decisive Nazi sympathies and actions of the Dulles brothers, John Foster and Allen, from their positions at Sullivan & Cromwell to their roles in the Eisenhower administration, in which they were, respectively, Secretary of State and head of the CIA.

From helping to forge the German cartels, such as I.G. Farben, to investing American money in Hitler’s war machine, to sabotaging attempts at interdicting the Third Reich’s flight capital program to working hand-in-glove with the Nazi spy apparatus of Reinhard Gehlen, to engineering the coalescence of a Nazi infrastructure in the GOP, the Dulles brothers were pivotal in the rise and retrenchment of Nazism.

As the key adviser to Foster in the German desk at the State Department, sister Eleanor Dulles was an “enthusiastic Hitlerite.” Awareness of her sympathy for Hitler fleshes out understanding of the fascist “Iron Triangle” the Dulles family manifested–a dynamic that dominated life (and death) in the 20th century.

“”Exit the Last Dulles” by Drew Pearson [“On the Washington Merry-Go-Round”]; Beaver County Times; 1/26/62.

A bespectaled, gray-haired lady bowed out of the State Department the other day–almost unnoticed–though her influence on foreign policy was great. She was Eleanor Dulles, last of the Dulles family to put its impact on the foreign affairs of the United States. Few people outside of the United States had heard of Miss Dulles since she won notoriety during the Roosevelt era as being pro-Hitler. But her quiet, square-jawed personality, much like her two elder brothers, had a lot to do with building up a strong, remilitarized Germany.

The notoriety occurred when the diary of Ambassador William E. Dodd, Roosevelt’s ambassador to Germany during the rise of Hitler, was published. It contained this item for Jan. 24, 1936:

“John Foster Dulles, who write for ‘The American Magazine’ on foreign affairs, but who is connected with a large banking business in New York, reported . . . ‘My sister lives here. She is an enthusiastic Hitlerite, and anxious to show me the German attitude for peace. So we went to the movie  ”Unter Wehrmacht,’ which she said is proof of the German desire for peace. I sat through the show, but the war planes, big guns, footage of attacks on civilians and the enthusiastic attitude of Hitler, Goering and Goebbels as they stood looking at the devastating work, took from my mind all thought of peace as an object of the show.’ . . .

. . . . Miss Dulles Gets a Job–That year, 1936, was when Hitler marched his new army into the Rheinland.

In 1934, a year after Hitler came into power, Miss Dulles’ husband, Prof. David Blondheim committed suicide. He was Jewish.

Mrs. Blondheim resumed her maiden name after that, taught in various women’s colleges, and in the late fall of 1952, just after Eisenhower was elected, turned up at the State Department at the office of Jimmy Riddleberger, then in charge of the German desk, to ask for a job.

“My brother says that if I get a job while the Democrats are in, he can keep me on when he becomes Secretary of State,” she explained, “Otherwise, he can’t hire me.”

Riddleberger gave her a job as advisor on German affairs.  Shortly thereafter, he shot up the promotion ladder to become ambassador. Miss Dulles remained the key German adviser to her brother during his career as Secretary of State. She was strong, persistent and persuasive in her views.

With the resignation of Allen Dulles from Central Intelligence last summer and the quiet departure of Eleanor Dulles this month, the Dulles family is now out of government. But, for better or worse, their policies live after them.

The Brothers: John Foster Dulls, Allen Dulles, and Their Secret World War by Stephen Kinzer; St. Martin Griffin [SC]; Copyright 2013 by Stephen Kinzer; ISBN 978-1-250-05312-1; pp. 49-52.

. . . . Foster had helped design the Dawes Plan of 1924, which restructured Germany’s reparation payments in ways that opened up huge new markets for American banks, and later that year he arranged for five of them to lend $100 million to German borrowers. In the seven years that followed, he and his partners brokered another $900 million in loans to Germany–the equivalent of more than $15 billion in early-twenty-first century dollars. This made him the preeminent salesman of German bonds in the United States, probably the world. He sharply rejected critics who argued that American banks should invest more inside the United States and protested when the State Department sought to restrict loans to Germany that were unrelated to reparation payments or that supported cartels or monopolies.

Foster made much money building and advising cartels, which are based on agreements among competing firms to control supplies, fix prices, and close their supply and distribution networks to outsiders. Reformers in many countries railed against these cartels, but Foster defended them as guarantors of stability that ensured profits while protecting economies from unpredictable swings. Two that he shaped became global forces.

Among Foster’s premier clients was the New Jersey-based International Nickel Company, for which he was not only counsel but also a director and member of the executive board. In the early 1930s, he steered it, along with its Canadian affiliate, into a cartel with France’s two major nickel producers. In 1934, he brought the biggest German nickel producer, I.G. Farben, into the cartel. This gave Nazi Germany access to the cartel’s resources.

“Without Dulles,” according to a study of Sullivan & Cromwell, “Germany would have lacked any negotiating strength with [International Nickel], which controlled the world’s supply of nickel, a crucial ingredient in stainless steel and armor plate.”

I.G. Farben was also one of the world’s largest chemical companies–it would produce the Zyklon B gas used at Nazi death camps–and as Foster was bringing it into the nickel cartel, he also helped it establish a global chemical cartel. He was a board member and legal counsel for another chemical producer, the Solvay conglomerate, based in Belgium. During the 1930s, he guided Solvay, I. G. Farben, the American firm Allied Chemical & Dye, and several other companies into a chemical cartel just as potent as the one he had organized for nickel producers.

In mid-1931, a consortium of American banks, eager to safeguard their investments in Germany, persuaded the German government to accept a loan of nearly $500 million to prevent default. Foster was their agent. His ties to the German government tightened after Hitler took power at the beginning of 1933 and appointed Foster’s old friend Hjalmar Schacht as minister of economics.

Allen [Dulles] had introduced the two men a decade earlier, when he was a diplomat in Berlin and Foster passed through regularly on Sullivan & Cromwell business. They were immediately drawn to each other, Schacht spoke fluent English and understood the United States well. Like Dulles, he projected an air of brisk authority. He was tall, gaunt, and always erect, with close-cropped hair and high, tight collars. Both men had considered entering the clergy before turning their powerful minds toward more remunerative pursuits. Each admired the culture that had produced the other. Both believed that a resurgent Germany would stand against Bolshevism. Mobilizing American capital to finance its rise was their common interest.

Working with Schacht, Foster helped the National Socialist state find rich sources of financing in the United States for its public agencies, banks, and industries. The two men shaped complex restructurings of German loan obligations at several “debt conferences” in Berlin–conferences that were officially among bankers, but were in fact closely guided by the German and American governments–and came up with new formulas that made it easier for the Germans to borrow money from American banks. Sullivan & Cromwell floated the first American bonds issued by the giant German steelmaker and arms manufacturer Krupp A.G., extended I.G. Farben’s global reach, and fought successfully to block Canada’s effort to restrict the export of steel to German arms makers. According to one history, the firm “represented several provincial governments, some large industrial combines, a number of big American companies with interests in the Reich, and some rich individuals.” By another account it “thrived on its cartels and collusion with the new Nazi regime.” The columnist Drew Pearson gleefully listed the German clients of Sullivan & Cromwell who had contributed money to the Nazis, and described Foster as chief agent for “the banking circles that rescued Adolf Hitler from the financial depths and set up his Nazi party as a going concern.”

Although the relationship between Foster and Schacht began well and thrived for years, it ended badly. Schacht contributed decisively to German rearmament and publicly urged Jews to “realize that their influence in Germany has disappeared for all time.” Although he later broke with Hitler and left the government, he would be tried at Nuremberg for “crimes against peace.” He was acquitted, but the chief American prosecutor, Robert Jackson, called him “the facade of starched responsibility, who in the early days provided the window dressing, the bait for the hesitant.” He baited no one more successfully than Foster.

During the mid-1930s, through a series of currency maneuvers, discounted buybacks, and other forms of financial warfare, Germany effectively defaulted on its debts to American investors. Foster represented the investors in unsuccessful appeals to Germany, many of them addressed to his old friend Schacht. Clients who had followed Sullivan & Cromwell’s advice to buy German bonds lost fortunes. That advice, according to one study, “cost Americans a billion dollars because Schacht seduced Dulles into supporting Germany for far too long.’ . . . .

. . . . Foster had clear financial reasons to collaborate with the Nazi regime, and his ideological reason–Hitler was fiercely anti-Bolshevik–was equally compelling. In later years, scholars would ask about his actions in the world. Did he do it out of a desire to protect economic privilege, or out of anti-Communist fervor? The best answer may be that to him there was no difference. In his mind defending multinational business and fighting Bolshevism were the same thing.

Since 1933, all letters written from the German offices of Sullivan & Cromwell had ended, as required by German regulations, with the salutation Heil Hitler! That did not disturb Foster. He churned out magazine and newspaper articles asserting that the “dynamic” countries of the world–Germany, Italy, and Japan–“feel within themselves potentialities which are suppressed,” and that Hitler’s semi-secret rearmament project simply showed that “Germany, by unilateral action, has now taken back her freedom of action.” . . . .

The Devil’s Chessboard: Allen Dulles, the CIA, and the Rise of America’s Secret Government by David Talbot; Harper [HC]; 2015; Copyright 2015 by The Talbot Players LLC; ISBN 978-0-06-227616-2; pp. 27-29.

. . . . Dulles and [Thomas] McKittrick [of the Bank of International Settlemnts] continued to work closely together for the rest of the war. In the final months of the conflict, the two men collaborated against a Roosevelt operation called Project Safehaven that sought to track down and confiscate Nazi assets that were stashed in neutral countries. Administration officials feared that, by hiding their ill-gotten wealth, members of the German elite planned to bide their time after the war and would then try to regain power. Morgenthau’s Treasury Department team, which spearheaded Project Safehaven, reached out to the OSS and BIS for assistance. But Dulles and McKittrick were more inclined to protect their clients’ interests. Moreover, like many in the upper echelons of U.S. finance and national security, Dulles believed that a good number of these powerful German figures should be returned to power, to ensure that Germany would be a strong bulwark against the Soviet Union. And during the Cold War, he would be more intent on using Nazi loot to finance covert anti-Soviet operations than on returning it to the families of Hitler’s victims.

Dulles realized that none of his arguments against Project Safehaven would be well received by Morgenthau. So he resorted to time-honored methods of bureaucratic stalling and sabotage to help sink the operation, explaining in a December 1944 memo to his OSS superiors that his Bern office lacked “adequate personnel to do [an] effective job in this field and meet other demands.” . . . .

. . . . While Allen Dulles was using his OSS post in Switzerland to protect the interests of Sullivan and Cromwell’s German clients, his brother was doing the same in New York. By playing an intricate corporate shell game, Foster was able to hide the U.S. assets of major German cartels like IG Farben and Merck KGaA, the chemical and pharmaceutical giant, and protect these subsidiaries from being confiscated by the federal government as alien property. Some of Foster’s legal origami allowed the Nazi regime to create bottlenecks in the production of essential war materials–such as diesel-fuel injection motors that the U.S. military needed for trucks, submarines, and airplanes. By the end of the war, many of Foster’s clients were under investigation by the Justice Department’s antitrust division. And Foster himself was under scrutiny for collaboration with the enemy.

But Foster’s brother was guarding his back. From his frontline position in Europe, Allen was well-placed to destroy incriminating evidence and to block any investigations that threatened the two brothers and their law firm. “Shredding of captured Nazi records was the favorite tactic of Dulles and his [associates] who stayed behind to help run the occupation of postwar Germany,” observed Nazi hunter John Loftus, who pored through numerous war documents related to the Dulles brothers when he served as a U.S. prosecutor in the Justice Department under President Jimmy Carter.

If their powerful enemy in the White House had survived the war, the Dulles brothers would likely have faced serious criminal charges for their wartime activities. Supreme Court Justice Arthur Goldberg, who as a young man served with Allen in the OSS, later declared that both Dulleses were guilty of treason. . . .

The Secret War Against the Jews; by John Loftus and Mark Aarons; Copyright 1994 by Mark Aarons; St. Martin’s Press; [HC] ISBN 0-312-11057-X; pp. 122-123.

. . . . Frustration over Truman’s 1948 election victory over Dewey (which they blamed on the “Jewish vote”) impelled Dulles and his protégé Richard Nixon to work toward the realization of the fascist freedom fighter presence in the Republican Party’s ethnic outreach organization. As a young congressman, Nixon had been Allen Dulles’s confidant. They both blamed Governor Dewey’s razor-thin loss to Truman in the 1948 presidential election on the Jewish vote. When he became Eisenhower’s vice president in 1952, Nixon was determined to build his own ethnic base. . . .

. . . . Vice President Nixon’s secret political war of Nazis against Jews in American politics was never investigated at the time. The foreign language-speaking Croatians and other Fascist émigré groups had a ready-made network for contacting and mobilizing the Eastern European ethnic bloc. There is a very high correlation between CIA domestic subsidies to Fascist ‘freedom fighters’ during the 1950’s and the leadership of the Republican Party’s ethnic campaign groups. The motive for the under-the-table financing was clear: Nixon used Nazis to offset the Jewish vote for the Democrats. . . .

. . . . In 1952, Nixon had formed an Ethnic Division within the Republican National Committee. Displaced fascists, hoping to be returned to power by an Eisenhower-Nixon ‘liberation’ policy signed on with the committee. In 1953, when Republicans were in office, the immigration laws were changed to admit Nazis, even members of the SS. They flooded into the country. Nixon himself oversaw the new immigration program. As Vice President, he even received Eastern European Fascists in the White House. . .

Discussion

One comment for ““Enthusiastic Hitlerite” Eleanor–The Third Side of The Dulles Iron Triangle”

  1. speaking of a “strong, remilitarized Germany”…

    https://www.thenation.com/article/the-united-states-and-nato-are-preparing-for-a-major-war-with-russia/

    or the first time in a quarter-century, the prospect of war—real war, war between the major powers—will be on the agenda of Western leaders when they meet at the NATO Summit in Warsaw, Poland, on July 8 and 9. Dominating the agenda in Warsaw (aside, of course, from the “Brexit” vote in the UK) will be discussion of plans to reinforce NATO’s “eastern flank”—the arc of former Soviet partners stretching from the Baltic states to the Black Sea that are now allied with the West but fear military assault by Moscow. Until recently, the prospect of such an attack was given little credence in strategic circles, but now many in NATO believe a major war is possible and that robust defensive measures are required.

    In what is likely to be its most significant move, the Warsaw summit is expected to give formal approval to a plan to deploy four multinational battalions along the eastern flank—one each in Poland, Lithuania, Latvia, and Estonia. Although not deemed sufficient to stop a determined Russian assault, the four battalions would act as a “tripwire,” thrusting soldiers from numerous NATO countries into the line of fire and so ensuring a full-scale, alliance-wide response. This, it is claimed, will deter Russia from undertaking such a move in the first place or ensure its defeat should it be foolhardy enough to start a war.

    http://abcnews.go.com/International/wireStory/germany-affirm-stronger-role-world-stage-40510202

    Germany to Affirm Stronger Role on World Stage

    By kirsten grieshaber and geir moulson, associated press

    BERLIN — Jul 12, 2016, 7:35 AM ET

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    Germany is affirming its growing role on the world stage in new security guidelines that mark another step away from its caution after World War II.

    A draft defense policy paper obtained by The Associated Press Tuesday and due to be presented on Wednesday states that “Germany is a globally highly connected country … which has a responsibility to actively shape the global order.”

    It formalizes what leading officials have been saying for the past 2½ years — a period in which Germany has played a leading diplomatic role in Ukraine’s conflict and joined a campaign to support the fight against Islamic insurgents in Mali, among other things.

    Germany also sent weapons to Kurdish fighters in northern Iraq, breaking with a previous reluctance to send arms into conflict situations. But although it has stepped up its diplomatic and military role, there’s still little chance of the government — which has to get all military missions approved by Parliament — dispatching combat troops to global hotspots in the same way as European allies France and Britain, and still less unilaterally.

    The so-called “white book,” the first such security policy review since 2006, stresses that Germany has no intention of acting alone and that all military action and diplomatic crises need to be tackled and solved with the country’s partners and allies.

    “The armed forces are focused on acting in a multilateral framework,” it says. “When it comes to taking responsibility for international security we are strongly dependent on the coordinated cooperation with our partners.”

    However, the government also says that “Germany is ready to introduce itself as an early, determined and substantial source of inspiration in the international debate, to live responsibility and take on leadership.”

    The paper also raises, albeit vaguely, the possibility of other European Union countries’ citizens serving in Germany’s military. “Opening the armed forces for citizens of the EU would offer not just far-reaching integration and regeneration potential for their personnel robustness, but also would be a strong signal for a European perspective,” it says.

    Germany backs NATO nations’ pledge to spend 2 percent of their national incomes on defense and is increasing defense spending. Still, Chancellor Angela Merkel acknowledged last week that “a lot remains to be done” to reach that mark — officials estimate that Germany’s defense spending will increase from 1.19 percent of gross domestic product this year to 1.21 percent in 2017.

    Germany emerged slowly from its post-World War II diplomatic shell after reunification in 1990. Former Chancellor Helmut Kohl broke a taboo against troops abroad by sending military medics to support the U.N. mission in Cambodia in 1992. But by the early 2000s, Germany had thousands of troops abroad — taking significant roles in Afghanistan and Kosovo, among other places.

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    Posted by Tiffany Sunderson | July 14, 2016, 1:33 pm

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