CARTELS: Gulliver, Bound but Sturdy

A plumpish, round-faced colonel, just back from Germany, appeared last week before the Senate’s cartel investigating committee. In the voluminous charts and documents under his arm, Colonel Bernard Bernstein, onetime U.S. Treasury aide and now head of the Army’s cartel investigations, had all that the Army has learned about Germany’s world-girdling I.G. Farben, and he wanted to warn U.S. industrialists what they are still up against.

As an appetizer, he served up some warmed-over charges that Standard Oil Co. (N.J.) had made prewar deals with Farben, that E.I. du Pont de Nemours had once been part owner of 6% of its stock (which it sold in 1940). But when Colonel Bernstein came to his main dish, it was new, and piping hot.

Without I.G., said he, Germany could not have waged the war at all. Abroad, I.G. had “cartel arrangements” with 2,000 companies, used them to help the Nazis. At home, besides its own plants, I.G. controlled another 380 German firms. As armorer for the Nazis, I.G. made all of Germany’s synthetic rubber and lubricating oil; 95% of its poison gases (Farben tested them on concentration camp inmates); 90% of the nickel; 88% of the magnesium, most of the gasoline and explosives for the buzz-bombs and V-2s.

On V-E day, said Colonel Bernstein, flatly contradicting what Byron Price and other trippers have reported, 87% of Farben’s wartime (1943) capacity remained intact. Allied bombing had done no more than halt production temporarily in some key spots. Said he: “The first view of the enormous plant at Ludwigshafen . . . is that it looks smashed. . . . [But the plant] is working today without the damage being repaired.”

To date, not one Farben plant has been blown up by the Allies, he said. Nor have any even been marked for destruction. The one plant destroyed with much fanfare three weeks ago was not owned, merely operated by Farben. Thirteen Farben munitions plants are still operating, in some cases even making powder, cartridges and shells for the Allies. Why the delay in breaking up Farben? Mutual distrust among the Allies, said Colonel Bernstein. (Only 9.7% of Farben’s factories are in the U.S. zone.)

How can Farben be kept from thrusting a controlling hand again into many a company in the U.S., as well as competing with U.S. firms all over the world? Answered Colonel Bernstein: only by ruthlessly breaking up all of German industry, as the Potsdam Declaration specifies.