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UNIVERSITY OF CALIFORNIA Los Angeles A Re-Assessment of Aryanization of Large Jewish Companies in Hitler’s Reich, 1933-1935: The Role of Conservative, Non-Nazi Businessmen A dissertation submitted in partial satisfaction of the requirements for the degree Doctor of Philosophy in History by William Maurice Katin 2018 © Copyright by William Maurice Katin 2018 ABSTRACT OF THE DISSERTATION A Re-Assessment of Aryanization of Large Jewish Companies in Hitler’s Reich 1933-1935: The Role of Conservative, Non-Nazi Businessmen by William Maurice Katin Doctor of Philosophy in History University of California, Los Angeles, 2018 Professor Albion M Urdank, Chair “Aryanization” is the Nazi term for the cheap purchase of Jewish firms during the Third Reich with the ultimate goal of eliminating Jews from the German economy. Eleven of the largest such companies in Germany are examined in this dissertation and a noticeable pattern becomes evident. In an atmosphere of anti-Semitism, conservative non-Nazi businessmen approached Germany’s three largest banks to request that they withdraw existing loans from the Hermann Tietz department store chain. Although this study focuses on the large Hermann Tietz and Leonhard Tietz retailers, it presents a new paradigm of Aryanization through analyses of the patterns of acquisition of massive publishing houses, as well as an enormous private bank, brewery, and gun manufacturer. The financial institutions participated because they earned fees, appointed bank executives to the formerly Jewish firms’ Supervisory Boards and became the house bank conducting all future transactions. Courts were unwilling to intervene in the coerced acquisitions, ii because they shared the same conservative mindset as the businessmen and financial institutions. By focusing on the Jewish enterprises, it appears that the largest enterprises were frequently purchased in 1933-1935, whereas the tiny “Mom-and-Pop-shops” usually went out-of-business in 1938. This insight has not been noticed by the traditional model, since it does not differentiate between large and small companies. The cheap purchase of Jewish-owned companies occurred throughout the 1933 through 1938 timeframe. Saul Friedländer keenly observed a radical break in its implementation during these six pre-war years, with the pre-1936 period being a time of “relative moderation.” He discerned a “new phase on the internal German scene” in 1936 in its manner of actualization, which had profound consequences. The 1936 break in the style of execution occurred due to Germany’s economic growth and return to full employment as well as Göring’s appointment to the Four Year Plan to prepare the nation for war. With regard to the Jewish citizens, the resulting “internal radicalization” in 1936 necessitated that in the opinion of the Reich “their assets [be] impounded for the benefit of German rearmament.” Furthermore, Schacht’s dismissal in 1938 also contributed to the Government replacing private opportunists as the key player in Aryanization.1 There were two periods of Aryanization. The 1933-1935 period, discussed in this dissertation, was characterized by an ad-hoc private initiative perpetrated by non-Nazi businessmen. In contrast, the 1936-1938 period was an organized state activity leading to the exclusion of Jewish businessmen from the German economy. Many historians have successfully elucidated the later 1936 through 1938 period of Aryanization directed from Berlin for the benefit of the state or private parties. By observing that the largest of Jewish-owned companies were taken during the earlier 1933 through 1935 period, 1 Saul Friedländer, Nazi Germany and the Jews. Volume I; The Years of Persecution, 1933-1939. New York: HarperCollins Publishers, Inc., 1997, pp.178-179. iii this dissertation would like to make a contribution to scholarship. The responsibility for the 1933-1935 Aryanizations is placed firmly on the private sector, rather than on either the Nazi political party or on the central government in Berlin as has been characterized for the 1936- 1938 timeframe. Another comprehensive break in the Aryanization process was the later focus on tens of thousands of mid-sized and small businesses as contrasted with the earlier conglomerates. The later timeframe additionally also concentrated on houses, apartments, acreage and even synagogues.2 This coincides with Friedländer’s far-reaching break between the two periods of Aryanization. Although the following quotation concerns the difference between the prices paid for large versus small firms, perhaps Friedländer could accept my interpretative inclusions, which coincide with my perspective: “As noted in chapter 13, recent research indicates that the considerable scope of [later] Aryanization at the medium- and small-business level was not indicative of the [earlier] situation at the higher level of the economy.”4 The interpretive adaptation of Friedländer illustrates that although this dissertation is indebted to him for an Aryanization paradigm, with a thoroughgoing differentiation before and after 1936, there are some significant contributions in this research. Another such example concerns the role of Conservatives in the process of expropriating Jewish companies. Friedländer viewed Conservatives, such as Schacht, as a protection for the continuation of Jewish ownership or at least that fair market value would be offered.5 However, research uncovered in this 2 Admittedly, Avraham Barkai observed that the Viennese Reichspost newspaper reported such sales as early as December 1935. See, Avraham Barkai, From Boycott to Annihilation; The Economic Struggle of German Jews 1933-1943. Hanover: University Press of New England, 1989, p.108. 3 In part, Friedländer is to referring to special treatment accorded to the Tietz and Ullstein commercial empires during the April 1933 boycott. See pages 24-25. 4 Friedländer, Op. Cit., p.233. 5 Friedländer, Ibid., p.236. iv dissertation indicated that in the earlier 1933-1935 period, Conservative businessmen without any capital were extended loans by Conservative bankers to coerce a sale in which Conservative judges were unwilling to ensure that justice was achieved. For the most part, one does not find documentation in the archives concerning the earlier 1933-1935 intervention by Adolf Hitler, Hermann Goering, or Rudolf Hess in the seizure of large Jewish-owned department stores, publishing houses, banks, and breweries. Instead, the key participants in the acquisition of such non-Gentile firms are non-NSDAP Party members, such as Joachim Tiburtius, Georg Karg, Max Winkler, Walther Frisch and Herbert Hoffmann. In Chapter III Section B4, this Dissertation has discovered and extrapolated on the venomous feature articles and lampoons beginning in December 1927 by Propaganda Minister Goebbels. However, my research process actually began by means of a different approach. In 2010, Business Historian Jeff Fear recommended that I begin my Aryanization research by reading microfilm on Hermann Göring’s Four Year Plan. Two significant differences immediately emerged between my 1933-1935 bottom-up approach in the investigation of seizing Jewish firms and a later top-down procedure. First, I discovered that in building his financial colossus, Göring had not depended upon acquiring firms from the consumer sector as the private Aryanizers did. Göring’s NSDAP-inspired technique involved acquiring control over firms in the Autobahn construction, car manufacturing and synthetic fuel and fiber replacement industries. Second, following Friedländer’s observation, Göring’s Four Year Plan commenced in 1936, which was after the timeframe from 1933 to 1935 in which the major Jewish companies had been “purchased.” Private “purchases” of Jewish-owned businesses for personal benefit occurred years before Göring’s acquisition of war-related industries for the state’s benefit. The Dissertation does v not seek to answer the question of whether comparatively smaller private sector Aryanizations influenced the later NSDAP’s public infrastructure acquisitions. In addition, neither Friedländer nor I attempt to address the quantitative issues of what percentage of rearmament funding originated with Hjalmar Schacht’s Metallurgische Forschungsgesellschaft promissory notes (also known as Mefo bills) as opposed to the requisition of Jewish assets. The hesitancy to be more quantitatively precise in both Aryanization and the funding of German rearmament is indirectly acknowledged by Friedländer’s admission: “It is difficult to assess what was paid…to the tens of thousands of Jewish owners…”6 This dissertation merely seeks to contribute to the understanding of early Aryanization. Neither the Aryanization by the state or by private individuals in the later 1936-1938 period are addressed. Numerous other economic issues remain for future research, including other private to public transitions such as the private pre-1933 building of the Autobahn to the later Organisation Todt construction of the roads.7 6 Friedländer, Op. Cit., p.233. 7 The May or June 1942 ninety-eight page evaluation of Göring’s first Four Year Plan contained in R 26 I/18 may be a profitable starting point for such future research. I am indebted to Gerhard Weinberg for this citation in “Hitler’s Memorandum on the Four-Year Plan: A Note,” German Studies Review, Vol. 11 No.1 (1988), pp.133-135. vi One of the three largest financial organizations was the Dresdner Bank. Its executive Karl Rasche was made a scapegoat by his firm in the subsequent war-crimes trials