Bring on the Slave Labour!

In order to combat the labour shortages in the factories, the Nazis relied increasingly on foreign labourers who were put to work in Germany under frequently inhuman conditions. Together with hundreds of thousands of Soviet and other POWs as well as inmates of concentration camps, these Fremdarbeiter (forced labourers) formed a gigantic pool of workers that could be exploited at will by whomever recruited them, in return for a modest remuneration paid to the SS. The SS, moreover, also maintained the required discipline with an iron hand. Wage costs thus sank to a level of which today’s downsizers can only dream, and the corporate profits augmented correspondingly.

The German branch plants of American corporations also made eager use of slave labour supplied by the Nazis, not only Fremdarbeiter, but also POWs and even concentration camp inmates. For example, the Yale & Towne Manufacturing Company based in Velbert in the Rhineland reportedly relied on ‘the aid of labourers from Eastern Europe’ to make ‘considerable profits,’ and Coca-Cola is also noted to have benefitted from the use of foreign workers, as well as prisoners of war in its Fanta plants. The most spectacular examples of the use of forced labour by American subsidiaries, however, appear to have been provided by Ford and GM, two cases that were recently the subject of a thorough investigation. Of the Ford-Werke it is alleged that starting in 1942 this firm ‘zealously, aggressively, and successfully’ pursued the use of foreign workers and POWs from the Soviet Union, France, Belgium, and other occupied countries — apparently with the knowledge of corporate headquarters in the US. Karola Fings, a German researcher who has carefully studied the wartime activities of the Ford-Werke, writes:

‘The thousands of foreign forced labourers put to work in the Ford-Werke were forced to slave away every day except Sunday for twelve hours, and for this they received no wage whatsoever. Presumably even worse was the treatment reserved for the relatively small number of inmates of the concentration camp of Buchenwald, who were made available to the Ford-Werke in the summer of 1944. (Research Findings, 45-72)

‘[Ford] did wonderful business with the Nazis. Because the acceleration of production during the war opened up totally new opportunities to keep the level of wage costs low. A general freeze on wage increases was in effect in the Ford-Werke from 1941 on. However, the biggest profit margins could be achieved by means of the use of so-called Ostarbeiter (forced workers from Eastern Europe].’

In contrast to the Ford-Werke, Opel never used concentration camp inmates, at least not in the firm’s main plants in Russelsheim and Brandenburg. The German subsidiary of GM, however, did have an insatiable appetite for other types of forced labour, such as POWs. Typical of the use of slave labour in the Opel factories, particularly when it involved Russians, writes historian Anita Kugler, were ‘maximum exploitation, the worst possible treatment, and…capital punishment even in the case of minor offences.’ The Gestapo was in charge of supervising the foreign labourers.

A Licence to Work for the Enemy

In the US, the parent corporations of German subsidiaries worked very hard to convince the American public of their patriotism, so that no ordinary American would have thought that GM, for example, which financed anti-German posters at home, was involved on the distant banks of the Rhine in activities that amounted to treason.

Washington was far better informed than John Doe, but the American government observed the unwritten rule stipulating that ‘what is good for General Motors is good for America,’ and turned a blind eye to the fact that American corporations accumulated riches through their investments in, or trade with, a country with which the US was at war. This had a lot to do with the fact that corporate America became even more influential in Washington during the war than it had been before; indeed, after Pearl Harbor representatives of ‘big business’ flocked to the capital in order to take over many important government posts. Supposedly they were motivated by sterling patriotism and offered their services for a pittance, so they became known as ‘dollar-a-year men.’ Many, however, appeared to be there in order to protect their German assets. Former GM president William S. Knudsen, formerly an outspoken admirer of Hitler and friend of Goring, became director of the Office of Production Management. Another GM executive, Edward Stettinius Jr., became Secretary of State, and Charles E. Wilson, president of General Electric, became ‘the powerful number-two man at the War Production Board.’ Under these circumstances, is it any wonder that the American government preferred to look the other way while the country’s big corporations squirreled in the land of the German enemy? In fact, Washington virtually legitimated these activities. Barely one week after the Japanese attack on Pearl Harbor, on 13 December 1941, President Roosevelt himself discreetly issued an edict allowing American corporations to do business with enemy countries — or with neutral countries that were friendly with enemies — by means of a special authorization. This order clearly contravened the supposedly strict laws against all forms of ‘trading with the enemy.’

Presumably, Washington could not afford to offend the country’s big corporations, whose expertise was needed in order to bring the war to a successful end. As Charles Higham has written, Roosevelt’s administration ‘had to get into bed with the oil companies [and with the other big corporations] in order to win the war.’ Consequently, government officials systematically turned a blind eye to the unpatriotic conduct of American investment capital abroad, but there were some exceptions to this general rule. ‘In order to satisfy public opinion,’ writes Higham, token legal action was taken in 1942 against the best-known violator of the ‘trading with the enemy’ legislation, Standard Oil. But Standard pointed out that it ‘was fueling a high percentage of the Army, Navy, and Air Force, [thus] making it possible for America to win the war.’ The Rockefeller enterprise eventually agreed to pay a minor fine ‘for having betrayed America’ but was allowed to continue its profitable commerce with the enemies of the United States. A tentative investigation into IBM’s arguably treasonous activities in the land of the Nazi enemy was similarly aborted because the US needed IBM technology as much as the Nazis did. Edwin Black writes: ‘IBM was in some ways bigger than the war. Both sides could not afford to proceed without the company’s all-important technology. Hitler needed IBM. So did the Allies.’ (Black, 333, quotation from 348) Uncle Sam briefly wagged a finger at Standard Oil and IBM, but most owners and managers of corporations who did business with Hitler were never bothered at all. The connections of ITT’s Sosthenes Behn with Nazi Germany, for example, were a public secret in Washington, but he never experienced any difficulties as a result of them.

Meanwhile, it would appear that the headquarters of the Western Allies were keen to go as easy as possible on the American-owned enterprises in Germany. According to German expert Hans G. Helms, Bernard Baruch, a high-level advisor to President Roosevelt, had given the order not to bomb certain factories in Germany, or to bomb them only lightly; it is hardly surprising that the branch plants of American corporations fell into this category. And indeed, while Cologne’s historical city centre was flattened in repeated bombing raids, the large Ford factory on the outskirts of the city enjoyed the reputation of being the safest place in town during air attacks, although some bombs did of course occasionally fall on its properties.

After the war GM and the other American corporations that had done business in Germany were not only not punished, but even compensated for damages suffered by their German subsidiaries as a result of Anglo-American bombing raids. General Motors received 33 million dollars and ITT 27 million dollars from the American government as indemnification. The Ford-Werke had suffered relatively little damage during the war, and had received more than 100,000 dollars in compensation from the Nazi regime itself; Ford’s branch plant in France, meanwhile, had managed to wrest an indemnification of 38 million francs from the Vichy Regime. Ford nevertheless applied in Washington for 7 million dollars worth of damages, and after much wrangling received a total of 785,321 dollars ‘for its share of allowable losses sustained by Ford-Werke and Ford of Austria during the war,’ which the company has acknowledged in its recently published report. (Research Findings, 109)

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