Expulsion – Plunder – Flight: Businessmen and Emigration from Nazi Germany

Introduction

A defining feature of political and social developments under National Socialist rule between 1933 and 1945 was the forced emigration of tens of thousands of Germans. After being deprived of their rights and dispossessed, they tried to escape persecution and annihilation by fleeing from the Third Reich and seeking refuge in a number of states around the world. Today the violent forms and dramatic circumstances of this expulsion and flight still remain deeply rooted in historical consciousness.[1]

While the origins and circumstances of emigration from the Reich after 1933 are among the most intensively researched questions in German history, the fate of businessmen in the context of this emigration has received relatively little attention. Therefore in this essay, after first outlining the background of the emigration during the first half of the Nazi period, we shall look in particular detail at the situation of the Jewish business community between 1933 and 1939.

The decision to emigrate was the result of interactions of external factors and personal dispositions so heterogeneous that it is scarcely possible to represent them in schematic form. Still, two significant groups of refugees, each with a certain bundle of reasons for emigrating, can be differentiated: first, the “politically” persecuted representatives of the Weimar democracy, including representatives of political parties, trade unionists, intellectuals, artists, writers, journalists and scientists. These can best be termed exiles, since many of them, in foreign lands, “had their faces turned toward Germany,” so to speak, and hoped to return to their homeland after the war. The second group of refugees was Jews whose attempt to flee from discrimination, violence and endangerment to their lives is best described by the term emigration. Most of them settled for good in their adopted homelands; only about three to five percent of Jewish refugees returned to Germany after 1945.[2]

It is Jewish émigrés, then, who will be the focus of this essay, which will thus cast some light on one particular area of antisemitic policy between the beginning of Nazi rule and the end of the 1930s.[3] Not only were émigrés ten times more numerous than political exiles, but among business people it was almost exclusively those of Jewish religion or origin who left the country after 1933.[4] Many non-Jewish German entrepreneurs, bankers, and industrialists, by contrast, were quick to submit to and come to terms with the regime, if not indeed to collaborate with it. It is true that the state and the NSDAP (Nationalsozialistische Deutsche Arbeiterpartei, National Socialist German Workers’ Party) encroached increasingly upon the autonomy of the private sector as part of a strategy for greater economic self-sufficiency and, eventually, rearmament and the wartime economy. Yet at first the business community focused mainly on the fact that, in principle, private sector structures continued to exist and that, in the wake of the worldwide Great Depression, new opportunities for profit were emerging; on the whole their profit-oriented business interests were in accord with the economic policy goals of the new regime.[5]

Seen in a historical context, the years of Nazi dictatorship represented a phase that differed from preceding periods as far as emigration is concerned. Before 1933 socio-economic reasons were the primary drivers of emigration. In the case of the failed Revolution of 1848, to be sure, political reasons played an important role in emigration, and many Jews in particular wanted to get away from nationwide legal and social discrimination and restrictions. All the same, the prime motive for emigration—especially to the “New World”— was essentially the prospect of better economic conditions. Economic crises in Germany and booms in the countries where the migrants headed—particularly the United States—constituted the crucial push and pull factors: population growth, the consequences of the changeover from an agrarian to an industrial society, and the growing demand for labor in the course of high industrialization.[6]After 1933, by contrast, it was disfranchisement and persecution that triggered mass emigration from the Reich. Moreover, unlike the emigrants of the nineteenth century who tended to be less well-educated and to come from lower social strata, the émigrés of the Nazi era were, as a rule, well-qualified professionals.

This contribution is not intended as an attempt to provide a comprehensive overview of National Socialist policies toward the Jewish population and the circumstances of everyday life under the dictatorship. Instead it will concentrate on those measures and conditions which had a direct bearing on emigration during the years of Nazi rule, and secondly on the specific situation of German-Jewish business people. So as not to go beyond the scope of the topic, we shall restrict ourselves to a discussion of the situation inside the Third Reich, and only marginally consider the immigration policies and requirements of other European and non-European countries.

Emigration Phases

On the basis of domestic political developments and legislative measures it is possible to differentiate several phases in the process of mass emigration from Nazi Germany.[7]As an immediate reaction to the first anti-Jewish measures and rioting in 1933 there was a wave of panicked emigration to neighboring European countries. Violence on the streets, marches of the SA (“Sturmabteilung”), the dissolution of political parties and the abolition of trade unions were for many an alarm signal and prompted a precipitate flight out of Germany. In addition to this, radical legal measures were enacted early on, among which the Law for the Restoration of the Professional Civil Service (Gesetz zur Wiederherstellung des Berufsbeamtentums) of April 7, 1933 should be mentioned.[8]This was drafted in great haste in response to the high number of civil servants who were ousted from their posts by local NSDAP and SA representatives, and it had the purpose of channeling anti-Jewish attacks. The law made possible the summary dismissal of any politically unpopular and “untrustworthy” civil servants, but it was one of the first laws to codify the strictest possible definition of “non-Aryan” and was aimed at public officials of “non-Aryan extraction.” The law was thus “the first juridical basis for the systematic banishment of Jews from all sections of society.”[9]

In this phase, intellectuals, writers and representatives of the democratic system were also persecuted by the Nazi regime and driven into exile. But many of those who emigrated hastily assumed that Nazi rule would not last long and they would soon be able to return. As the domestic political and social climate became more peaceful—at least superficially—the number of émigrés declined, from 37,000 in 1933 to 23,000 (1934) and then 21,000 (1935). Some émigrés even decided to return to Germany, although daily violence and anti-Jewish measures continued. But in the spring and summer of 1935 a second large wave of anti-Semitism swept through the Reich. Intimidation and boycotts spread ever further, reaching almost all parts of the country in July and escalating in August 1935. In Berlin, for instance, pogrom-style mass attacks perpetrated by the Hitlerjugend (“Hitler Youth”) and the SA on the Kurfürstendamm forced the authorities to intervene on a large scale.[10]

Source: Herbert A. Strauss, “Jewish Emigration from Germany: Nazi Politics and Jewish Responses (1),” Leo Baeck Institute Yearbook 25 (1980): 313-361, here Tab. VII, 326.

A further heavy blow then came with the passing of the “Nuremberg Laws” (Nürnberger Gesetze) of September 15, 1935, by means of which the antisemitic “race ideology” of the National Socialists was enshrined in law and Jews were excluded from state and society.[11]The Reich Citizenship Law (Reichsbürgergesetz) put an end to civic equality for the Jewish minority that had been established in 1871. It introduced a distinction between “citizens of the Reich” with “German or kindred blood,” who were accorded full political rights, and “nationals of the state,” who had fewer rights; Jews could only be classified in the latter category. The First Ordinance on the Reich Citizenship Law (Erste Verordnung zum Reichsbürgergesetz) issued two months later further distinguished between “Aryans,” “non-Aryans,” and “Jews” and introduced the term Mischling (“cross-breed”). The decisive factor in classification was whether an individual’s grandparents had been affiliated with the Jewish religion.

These developments naturally contributed to a rise in the number of émigrés in 1936—25,000 for the whole year—and also to increased internal migration from rural areas to the cities. Nonetheless the situation in 1936–37 was characterized again by a deceptive calm and the number of arbitrary antisemitic actions and new anti-Jewish laws decreased. The reasons for this were the Reich’s sensitivity to foreign relations and a desire not to jeopardize its rearmament program. Moreover, the 1936 Olympic Games in Garmisch-Partenkirchen in February and Berlin in August were supposed to project the image of a German state free of repression to the international community. From autumn 1937, however, a renewed rise in anti-Jewish regulations became impossible to overlook, until finally a spate of laws and ordinances once and for all destroyed the Jewish minority’s means of existence. The climax of terror was the “Reichskristallnacht” which began on November 9, 1938 and continued in some parts of the Reich for several days. During these pogroms dozens of Jews were murdered, many maltreated and some 30,000 dragged off to concentration camps; synagogues were set on fire and Jewish stores plundered. The Jewish population in the Reich was robbed of any illusions that the pace of repression would stabilize, and “the total collapse of an orderly emigration began… From autumn 1938 onward the prevailing mood can be summed up as ‘Run for your lives.’”[12] The refugee figures reflect this very clearly, rising to 40,000 émigrés in 1938 and peaking in 1939 at 78,000 emigrés.

With the outbreak of World War II on September 1, 1939, the chances of escape were drastically reduced. Once preparations for the deportations had been completed and the “final solution to the Jewish question” (“Endlösung der Judenfrage”) had begun to be implemented, emigration was formally declared illegal on October 23, 1941. Between 1941 and 1945 only about 31,500 Jews managed to escape from Nazi Germany. In all, some 30,000 political exiles and 270,000–300,000 Jewish émigrés were driven out of the Reich during the Nazi era. About one tenth of them were deported when the countries in which they had sought refuge were occupied by German troops, and perished in concentration camps.

Extortion and Denaturalization Measures

State policy on emigration was characterized by contradictions and the lack of clear conceptions and as such reflected the Nazi regime, riven as it was by rivalries, disagreements and conflicts between various Party and state bodies.[13]While politically persecuted exiles were prevented from fleeing by all available means and were even kept under surveillance when abroad, the situation of the Jews excluded from the German “Volksgemeinschaft”(“racial community”) was not consistent or uniform. On the one hand, their emigration was accelerated by laws forbidding Jews to hold jobs and facilitated by logistical support from the Reich Migration Office (Reichswanderungsamt) of the Ministry of the Interior. The Reich Migration Office, in turn, sought out the cooperation of the Hilfsverein der Juden in Deutschland (Benevolent Society of Jews in Germany), which developed into the central agency for Jews wishing to emigrate from Germany to all parts of the world (with the exception of Palestine; see below).

Responsibility for emigration, however, slowly but surely passed into the hands of the Geheime Staatspolizei (Gestapo), where the racist ideology of its personnel impeded their willingness to work with Jewish organizations even in the cause of exiling Jews from Germany. Swift emigration was further impeded by mandatory surtaxes, which rose to a ruinous level in the course of the thirties. The persecution measures were designed “not so much to get rid of the Jews… as to carry anti-Semitism into the western countries in which Jews have sought refuge,” a Foreign Office circular from January 1939 explained. It was “in the German interest… to chase the Jews over the borders as beggars, for the poorer the immigrant is, the greater the burden for the host country.”[14] This logic presumed that the movement of impoverished refugees fleeing en masse would provoke social unrest and stir up anti-Jewish sentiment in the countries where they arrived, with the result that foreign nations would be increasingly reluctant to take them in. This policy met with categorical opposition on the part of representatives of the Reichsbank, who had characterized Jewish mass emigration as a “severe hemorrhage for the German economy” in a memorandum from September 1935, warning that “the German economy is today no longer able to bear a forced emigration of Jews,” because Germany’s balance of trade would worsen dramatically if a large number of Jews were to emigrate as a result of anti-Jewish policies, and that “Economic self-preservation therefore urgently demands restraint in the Jewish question.”[15] Instead, the state developed an array of mechanisms to rob the Jewish population which in the end amounted to full-scale expropriation.

The legitimate expectation of severe material deprivation and the loss of social status abroad made many German Jews hesitate to leave. In December 1931, as part of a system of foreign currency control measures, the Reich Flight Tax (Reichsfluchtsteuer) was introduced in order to prevent the transfer of capital out of the country.[16]Originally, all emigrants with capital in excess of 200,000 RM (or $48,000 in U.S. dollars in 1932, the equivalent of $758,000 in 2010) or an annual income of over 20,000 RM ($4,800 in 1932 dollars; $76,000 in 2010 dollars) had to give one fourth of it to the state.[17] After 1933 the tax was modified in such a way that the state could particularly profit from the emigration of the Jewish population. The tax exemption limit was lowered to 50,000 RM (or $20,000 1935 U.S. dollars; $320,000 2010 U.S. dollars) and an emigrant’s assets and income as of January 1, 1931 were used for defining the tax assessment, meaning that the tax burden was not lessened even in the event that the emigrant’s personal financial situation had worsened. State revenue from the Reich Flight Tax totaled 1 million RM in 1932–33 ($305,000 in 1933 U.S. dollars, or $5.13 million in 2010 U.S. dollars), rising to an estimated 50 million RM in 1933–34 ($19.7 million in 1934 U.S. dollars, or $320.6 million in 2010 U.S. dollars) and to 342 million RM by 1938–39 ($137 million in 1939 U.S. dollars; $2.15 billion in 2010 dollars), resulting in a total fiscal gain of approximately 900 million RM by 1939 ($360 million in 1939 U.S. dollars; $5.66 billion in 2010 U.S. dollars). A further “Jewish Property Tax” (Judenvermögensabgabe) was levied in the wake of Reichskristallnacht, on November 12, 1938, by order of Hermann Göring, and justified as an “atonement” for “Jewry’s hostility toward the German people and the Reich.” From April 1938 onward, Jews also had to declare all assets held in Germany and abroad, and had to pay first 20 percent, and then after November 1939 25 percent of its value to the state, which collected a further 1.1 billion RM ($440 million in 1939 U.S. dollars; $6.92 billion in 2010 U.S. dollars) from this measure.

Finally, the transfer of remaining funds out of Germany after emigration was accompanied by further drastic losses thanks to exchange rates, and even the export of small sums was an extremely complicated process. The monies left behind had to be paid into a “blocked emigrant’s account” (Auswanderer-Sperrmark-Konto) and were released only in certain cases. For the sequestered funds to be converted into foreign currency it was necessary to pay a fee originally set at fifty percent of the total amount but rising to seventy percent in early 1935, and finally to 96 percent until capital transactions of this kind were suspended at the outbreak of war. Even after all taxes and levies had been paid and all formalities settled, wealthy émigrés in particular were subjected to further extortion before leaving the country. Wolf-Heinrich Graf von Helldorf, Berlin’s chief of police, played a notorious role in this extortion racket. For example, Hermann Ullstein, formerly one of the owners of the large Ullstein publishing house, was summoned to a meeting with von Helldorf on November 30, 1938. Ullstein had by then already paid out 100,000 RM ($40,000 in 1938 U.S. dollars; $621,000 in 2010 U.S. dollars) in taxes and other charges to finance the emigration of his children. “Mr. Ullstein, the chief of police has paid special attention to your case,” he was informed. “In his opinion, another sacrifice on your part is necessary before a passport can be granted.” Thereupon Ullstein was obliged to hand over another 100,000 RM in cash as a so-called “Helldorf donation” before he and his wife were permitted to leave for Great Britain, where they arrived on New Year’s Day 1939 with 10 RM ($4 U.S. dollars in 1939 money; roughly $63 in 2010 dollars).[18]

Another block was placed on the assets of Jewish émigrés in summer 1940 when pension payments to Germans living abroad were stopped. Until then these had still been possible at least in principle, though in practice they had often been hindered by foreign currency regulations. This policy, however, ended up annoying the émigrés’ former employers in the Third Reich, since rather than companies being released from their obligations, the lifespan of the pensioners was estimated and companies had to pay the corresponding pension contributions into a state-controlled fund.[19]

In addition to being robbed of their assets, émigrés faced the threat of denaturalization (Ausbürgerung).[20]On July 14, 1933, a law was passed providing for the revocation of naturalization and citizenship. The law was initially applied in the case of prominent political opponents of the Nazi regime and writers. The first list of persons stripped of citizenship, published on August 25, 1933 – in all there would be 359 such lists – included the names of Lion Feuchtwanger, Heinrich Mann, Philipp Scheidemann, Ernst Toller, Kurt Tucholsky and Otto Wels. At first a means of political persecution, denaturalization increasingly became an instrument of “racialist” persecution, and responsibility for the issue gradually passed from the Ministry of the Interior to the Gestapo. Initially denaturalization was only used in individual cases, but from 1937 onward it was applied en masse against the Jewish population.

As Reinhard Heydrich, the chief of the Sicherheitspolizei (Security Police), declared in July 1937, the group of “enemies of the people” who were to be stripped of their citizenship should also include “those Jewish émigrés who have come to our attention as a result of typically Jewish behavior that is detrimental to the people though not directly attributable to political motives.” Such behavior, according to Heydrich, included offenses against foreign currency and tax laws, false bankruptcy, as well as all instances “in which the Jewish émigré has done harm to the collective by his economic activities, e.g. by transferring capital, by relocating his business operations abroad and thus damaging the national economy… [and] by emigrating without settling his debts.”[21] Between 1933 and 1939 about 39,000 people lost their German citizenship; in 1941, pursuant to the Eleventh Ordinance on the Reich Citizenship Law, all 240,000–260,000 Jews who had emigrated or were interned in concentration camps were collectively stripped of German citizenship. With the loss of German nationality, émigrés had their property confiscated, lost all claim to social benefits, and were divested of their academic titles. On top of that, as stateless refugees in foreign countries they did not enjoy the protection of the Reich, and in many host countries had no right of residence since they had no valid passport.

The International Situation

If we now briefly consider the international situation, we should mention in particular the unsuccessful conference at Évian, France, which symbolized the harsher policy toward refugees that came to prevail in the thirties and forties.[22]At this ten-day conference on the French side of Lake Geneva in July 1938, convened by U.S. president Franklin D. Roosevelt and attended by delegations from thirty-two countries, any condemnation of the anti-Jewish policies of the Third Reich was avoided and no commitment was made to liberalize refugee policy. For the émigrés, the chances of finding a safe haven within Europe continued to worsen. In 1933, 72–77 percent of them had been admitted to European countries; in 1934 the proportion had sunk to 35–40 percent and by the middle of 1938 only one quarter were being admitted.[23]

Immigration to Palestine was made somewhat easier, and until 1936 it had been the principal destination of German-Jewish émigrés. In August 1933 the Haavara Agreement was signed between Zionist representatives in Germany and Palestine and the Reich Ministry of Economic Affairs. The agreement made it possible to transfer assets to British-administered Palestine through the sale of German goods.[24]Émigrés could pay up to 40,000 RM ($16,000 in 1935 U.S. dollars; $255,000 in 2010 dollars) into frozen accounts which were restricted to purchasing German goods for export to Palestine; proceeds from the sale of these goods in Palestine then went to the émigrés. Under this agreement, a total of 140 million RM ($56 million in 1939 U.S. dollars; $880 million in 2010 U.S. dollars) was transferred, which provided most of the 60,000 immigrants from the Reich with the basic means to eke out a living.

From 1937 the United States became the main destination of German émigrés, particularly with the immigration quota regulations being less rigorously enforced by the American government. German immigration to the U.S. did not reach anything like the dimensions of the 1850s–1890s and was indeed on a smaller scale than during the Weimar Republic: we can estimate that, in all, 132,000 German Jews had emigrated to the USA by the end of the war.[25]

Entrepreneurs: Émigré entrepreneurs as a research desideratum

Emigration research has overlooked German entrepreneurs: in contrast to politicians, artists, intellectuals or scientists, they remain “forgotten émigrés.”[26] The dimensions and processes of the forced mass emigration of the owners of large and small businesses, representatives of industry and banking, proprietors and shopkeepers have been researched as little as their subsequent fate in the host countries. And while the damage done to scientific and cultural life in Germany is still visible and still lamented to this day, the medium to long-term consequences of the exodus for the country’s economy receive scant consideration.

(Socio-)historical interest has tended to focus on entrepreneurial success stories, on individuals who continued their business activity beyond the turning points of 1933 and 1945, whereas entrepreneurs who failed or whose property was plundered and who had to escape into a different, unfamiliar sphere of activity have dropped out of view. The problematic source situation makes matters worse, since there is a lack of central archives and autobiographical literature in which business people themselves reflect on their experiences of persecution and emigration. Moreover, émigrés from the economic sphere neither founded exile organizations nor contributed significantly to planning for a Germany liberated from National Socialism. This kind of commitment was discovered by “classical” exile research.

In view of the problematic source situation and the incomplete state of research in this field, prominent businessmen will remain at the center of further investigations for the time being. The case studies cited later in this essay are also primarily drawn from the economic elite of the Third Reich, even though such individuals of course represented only a tiny portion of the German business community and it was the “nameless” entrepreneurs, the owners of shops and small firms, who made up the bulk of the persecuted business-sector émigrés.

Businessmen and “Aryanization”

The emigration of German-Jewish entrepreneurs was in some cases preceded by the loss of their firms, their business interests or their positions in the economy, but generally it came at the end of a gradual process of exclusion from economic life. This was part of a phenomenon referred to by the – not uncontested – term “Aryanization” which represented one of the biggest transfers of ownership in German history.[27]“Aryanization” affected companies, securities, real estate and other property, all of which passed without the owner’s consent from “Jewish” into “non-Jewish” hands, commonly for very much less than their real value.

The “Aryanization” of the German economy has been the subject of intensive historical research in the past few years, and this has brought forth a host of studies about individual enterprises.[28] The focus in these studies has been both on those who profited from “Aryanization” and on the dispossession and expulsion of Jewish business owners, managers, and staff. A multitude of policy makers and interest groups from politics, the economy, and the civil service was involved in “Aryanization” procedures. Those who took over formerly Jewish businesses were in some cases profiteers without scruples who ruthlessly exploited the situation and even personally took part in denunciations and intimidation. A second group of beneficiaries could be described as “silent partners,” who were opportunistic though less conspicuous in reaping the rewards of “Aryanization” and took pains to ensure that the transfer of ownership should have an outwardly correct form. Finally, there were also well-intentioned and fair-minded business people who were prepared to pay reasonable prices and even acted to conceal transactions that were fair to Jewish sellers from the scrutiny and disapproval of the Reich.[29]

The year 1933 was the starting point of a continuous process and sustained procedure of liquidation and depredation. Jewish businessmen were subject to constant, massive pressure from the beginning of the dictatorship onward. According to Avraham Barkai, by the middle of 1935, 20–25 percent of “Jewish” businesses were already no longer in the hands of their original owners, and by the beginning of 1938 that number stood at 60–70 percent.[30]

One of the first signals of “Aryanization” was the nationwide, day-long boycott of “Jewish” shops, department stores, doctors, and lawyers on April 1, 1933, which was directed by Julius Streicher, the publisher of Der Stürmer and Gauleiter of Franconia, and carried out with the help of the SA and the SS (Schutzstaffel, or Defense Corps).[31]The boycott had dramatic repercussions for many Jewish businessmen, and the economic consequences for large enterprises were also considerable. Particularly affected, for example, were the large department stores; industry leaders like Karstadt or Hermann Tietz suffered dramatic declines in sales, which in turn threatened many suppliers who could only be saved from collapse by loans from the state.The official boycott was followed by an outbreak of spontaneous boycott actions and attacks on Jewish-owned businesses called by local or regional organizations of the NSDAP, chambers of industry and commerce (CICs), and local administrations without backing from the Reich. The central government and party leaders in Berlin tried repeatedly to contain these actions with ordinances and appeals in the interest of reviving the economy after the global economic crisis and combatting unemployment.[32]

The scope and intensity of “Aryanization” picked up considerably from the end of 1937. The NSDAP became more strongly involved, and a systematic census of Jewish entrepreneurs and businessmen was carried out by municipal authorities and the CICs. With all political restraint abandoned and with direct pressure from the highest party levels, the still existing structures of Jewish commercial activity and independence were destroyed once and for all. On October 14, 1938, Göring declared that the “Jewish question should now be tackled with all means, since they [the Jews] must get out of the economy.”[33]On November 12, 1938, two days after the pogrom of Reichskristallnacht, the Decree on the Elimination of Jews from German Economic Life was passed, which closed off nearly all remaining possibilities for making a living and sanctioned the dismissal of Jewish employees. As of January 1, 1939, all Jews were prohibited from engaging in any kind of business activity. Especially problematic, from an economic point of view, were the “Aryanizations” of large enterprises and important private banks.[34] Precipitous changes within the ownership and management structures, or even the liquidation of such businesses, posed a danger of disastrous and haphazard damage to the national economy.

There had already been an abrupt shift of power in the top echelon of the German economy that had targeted Jewish businessmen. In roughly the first eighteen months of Nazi rule, the management and supervisory boards of the country’s large joint-stock companies, which were, respectively, approximately 11% and 25% Jewish, displaced at least half their Jewish members.[35] And by 1938 they had lost 92% of their management board seats and 83% of their supervisory board seats. It must be emphasized that this development occurred largely without a legal basis. It was only at the beginning of January 1938 that a decree by Göring laid the groundwork for the Third Ordinance on the Reich Citizenship Law of June 14, 1938, which ordered the dismissal of any remaining Jewish members from the management and supervisory boards of all joint-stock companies in order to avoid classification as a “Jewish enterprise” and the state-ordered dissolution of the company.

The varied impulses that had already exerted a massive effect on Jewish members of the economic elite were exacerbated by direct intervention in the governance of companies that had come under state ownership by direct interventions by top party and government officials at the Reich, state, and municipal level. In the wake of the drastic moves by the NSDAP and of the propaganda ministry under Joseph Goebbels to eliminate the free press, large non-government publishing houses like Ullstein or Mosse were also affected. With threats of violence and legal measures such as the Reich Chamber of Culture Law and the Editors’ Law, publishing houses were controlled, forced into line, and closed down.

Pressure to cast out Jewish managers and directors came secondly in the form of antisemitic attacks both from outside special interest groups like the Fighting League of the Commercial Middle Class (Kampfbund für den gewerblichen Mittelstand) and also from company employees. In part the latter were organized into National Socialist Factory Cells Organizations (Nationalsozialistische Betriebszellen-Organisation, NSBO), which took advantage of their power within businesses especially after the breakup of the unions, and which the textile entrepreneur Fritz Grünfeld called the “underground organization of our employees.”[36]Finally, individual bankers and industrialists within the large enterprises actively joined in expelling their Jewish colleagues. In most cases these were manifestations of opportunistic conformity and anticipatory obedience that went beyond the widespread passivity and indifference. At times, however, these actions went as far as businessmen actively collaborating with the regime to advance their careers and boost personal profits.

That this could trigger vehement reactions by the victims is revealed by the example of Georg Solmssen (1869–1957), who sat on the board of the Deutsche Bank und Disconto-Gesellschaft. After two other Jews on the board, Oscar Wassermann and Theodor Frank, were forced out, Solmssen felt that his position as spokesman of the board was also in danger. Following a meeting with the new president of the Reichsbank, Hjalmar Schacht, he wrote to Franz Urbig, the chairman of the Supervisory Board of Deutsche Bank, on April 9, 1933:

“I fear we are still at the beginning of a development that is aimed, deliberately and following a carefully devised plan, at the economic and moral destruction of all members of the Jewish race living in Germany, namely without any distinctions whatsoever. The total passivity of the classes that are not part of the National Socialist Party, the lack of any feeling of solidarity displayed by all those who until now have worked in the professions in question shoulder to shoulder with Jewish colleagues, the ever clearer urge to derive personal benefit from positions that become free, and the utter silence about the disgrace and harm inflicted incurably upon all those who, though blameless, see the basis of their honor and existence destroyed from one day to the next – all this reveals such a hopeless situation that it would be inappropriate not to face the facts without any attempt at whitewashing them.”[37]

In the years that followed Solmssen displayed a remarkable combative determination to fight back, denouncing the lack of solidarity, opportunistic self-enrichment, passivity, and silence, until he was pushed off of the company’s supervisory board in 1938 and emigrated to Switzerland for good.

However, a businessman’s good reputation, and with it the trust he enjoyed in his economic life, could be destroyed through defamation and slander long before business positions were formally relinquished. Added to this were the personal, social, and psychological consequences of stigmatization, marginalization, and threat, which weighed on each individual affected. “It was like bidding farewell to life itself,” is how the publisher Hermann Ullstein remembered the “Aryanization” of the Ullstein Verlag in 1934.[38]

How long businessmen were able to defend their economic positions under the conditions of the dictatorship depended on the strength of the external pressure and the individual’s willingness to fight, but also on the stance taken by their own companies. Depending on their economic strength and ownership structure, maneuvering room was certainly available to them, and until the middle of 1938 those who chose to could shield Jewish subordinates from the racial laws or continue to employ them indirectly though consultant contracts after their formal departure. Another possibility, especially for large companies that were export-oriented and active internationally, was to transfer employees to European or overseas subsidiaries, thereby, incidentally, continuing to benefit at least temporarily from their skills.

Special civic courage was displayed by Ernst Leitz (1871–1956), for example, whose manufacturing company in Wetzlar had risen to become one of the global leaders in 35-millimeter camera production thanks to its Leica model. After 1933, Leitz hired Jews specifically in order to place them in jobs abroad. A central point of contact in the process was its most important subsidiary, E. Leitz Inc. in New York, which had been founded in 1893 as a sales office. Many émigrés found employment here, and vice-president Alfred Boch, apart from managing Leica sales, was also in charge of finding guarantors, lodgings, and jobs for Jewish immigrants.[39]

The kinds of difficulties that could arise in the process are revealed by the case of the largest German construction company, Philipp Holzmann, in Frankfurt, which was pressured by the NSDAP to fire the Jewish members of its management team.[40]Board member Charles Rosenthal (1888–1938), however, a polylingual lawyer and finance expert, seemed indispensable to the company, which then tried, following Rosenthal’s dismissal in the fall of 1933, to temporarily loan him back to Holzmann in his capacity as director of the Swiss subsidiary Sofitec. When that failed, Rosenthal was able to at least coordinate the company’s South America business from Bogota, Columbia, where Holzmann was building an important train line to Medellin. The foreign policy office of the NSDAP quickly challenged this personnel arrangement and at the end of 1934 Rosenthal’s contract with Sofitec was terminated with severance pay. These kinds of strategies were more successful in the internationally active Berlin company Schering AG, a conglomerate involved in chemical and pharmaceutical production and coal mining.[41]Board member Paul Neumann (1883–?), who oversaw Schering’s business in France, emigrated to Paris as early as August 1933. There he remained active for the company and oversaw the construction of a pharmaceutical factory in Calais, which he had previously helped to design. From 1934 to 1938, Neumann was part of the management of one of Schering’s subsidiaries, and until the end of 1938 he devoted himself to the task of concealing the German ownership of Schering’s French subsidiaries. He then functioned as a resident trustee for Schering’s stock holdings in the French companies, protecting the company from major tax losses, through the summer of 1940. Julius Weltzien, meanwhile, the former chairman of the board, remained part of Schering’s leadership for several more years, before taking over Schering Corporation in Bloomfield/New Jersey in May 1938. Martin Bernhardt, from the company’s mining division, was also given the chance to move to the Schering Corporation at the end of 1937. Following the German Reich’s declaration of war against the US, however, the company was seized and Weltzien and Bernhardt were suspended. For Ernst Schwarz (1884–1957), as well, a new chapter began with the change in the global political situation. In 1934, I.G. Farbenindustrie AG in Frankfurt, one of the world’s largest chemical companies, whose deputy director he had been until then, dispatched him to the United States, where he became president of the subsidiary Agfa Ansco Corporation in Binghamton, New York. When he was naturalized in 1939, at the beginning of World War II, he declared: “I am now an American and have only sympathies with America and as an American.”[42]

Activities of Jewish Businessmen

A variety of actions and activities by bankers and industrialists reveal that many Jewish businessmen did not react passively to the “Aryanization” process. Among those who were especially determined to fend off or at least ameliorate the anti-Semitic measures from the beginning was Max Warburg (1867–1946), head of the important Hamburg private bank M. M. Warburg.[43] Warburg headed the Hilfsverein der deutschen Juden, founded in 1901, and became active in the wake of the Haavara Agreement. In June 1933, he initiated the drafting of a memorandum signed by leading German businessmen to urge the NSDAP and government leadership to proceed more moderately when it came to “Jewish policy.”[44]It became clear that already at this early point in time, mass emigration as a reaction to National Socialist policy was being accepted. The goals of the Nazi government, a second draft argued, could “be carried out with smaller economic upheavals… if… the emigration of a part of the non-Aryans, which may seem necessary under certain circumstances, takes place in an organic way directed by the state.” Moreover, if emigration were placed under the protection of the state, this would “preserve among the emigrants… the feeling of attachment to Germany, which would have to benefit our fatherland morally and economically.”[45]

Great personal engagement was also displayed by Hans Schäffer, who had been an influential state secretary in the Reich Finance Ministry until 1932 and was one of the first Jewish executives to lose his position on a management board when he was dismissed from the board of the Ullstein AG in March 1933.[46]Jewish emigrants and organizations attempting to assist them consulted Schäffer on various questions regarding the transfer of assets abroad, and Schäffer continuously protested against the anti-Semitic policy to politicians and businessmen. For example, he took Hans Luther, a former chancellor appointed as ambassador to the United States in 1933, to task for remarks he had reportedly given defending the National Socialist regime’s racial policies. His letter emphasized that “We are not dealing with compassion for the harrowing fate of individuals, but with the elimination of the injustice that has been inflicted upon a group of valuable German persons, who did not deserve this given their accomplishments for the general population and their dutifulness toward the fatherland.”[47] After Schäffer emigrated to Sweden in the summer of 1933, he did not lose sight of the plight of the German Jews. In 1935 he told Hermann Röchling, a mining industrialist from the Saarland, “What I… want to achieve and will achieve is that men… like you…do not knowingly close their eyes to what has really happened, and that they also will not accept what has happened ever after because it does not concern them personally or those close to them.”[48]He continued to correspond with leading personalities from the worlds of business and politics, and endeavored, through his global connections, to find work opportunities for Jewish refugees outside of Germany, and to procure visas and residence permits. In 1938 he also tried to produce a successful outcome to the Évian Conference.[49] Given his own emigration experiences, Schäffer saw his relief efforts as a matter of personal obligation: “My wife and I [have] all kinds of opportunities to be helpful to other people of our former circles; of course, compared to what would be necessary, it is a drop in the sea.”[50]

Phases in the Emigration of Businessmen

On the whole one can assume that the decisions of Jewish businessmen to emigrate or remain in Germany were influenced by the same motives that prevailed among the rest of the Jewish population. What needs to be emphasized are the multiple familial and social bonds that kept many from fleeing quickly, as well as their self-conception as citizens of the German Reich who were fully integrated into the political community. Among the businessmen, as well, not a few clung to the illusion, even after the passage of the Nuremberg Laws, that their legal status would not be eroded further.

No precise data exist about either the number of businessmen who emigrated from the Nazi state or on the timeline of their departures. However, two surveys allow at least an approximation of how emigration was distributed over the years between 1933 and 1944: one concerns 186 members of the management and supervisory boards of the largest German stock companies, the other 151 businessmen who fled from the Nazi state to the American metropolis of émigrés, New York.[51]

Chart 2: Distribution of German-Jewish Emigres, 1933-1941 by Year (Total/Business Elite/Entrepreneurs) (in %)

Author’s calculations based on Herbert A. Strauss, “Jewish Emigration from Germany. Nazi Policies and Jewish Responses (I),” Leo Baeck Institute Yearbook 25 (1980): 313–361, here Tab. VII, S. 326; Martin Münzel, Die jüdischen Mitglieder der deutschen Wirtschaftselite 1927–1955. Verdrängung – Emigration – Rückkehr (Paderborn et al.: Schöningh, 2006), p. 246f.; author’s survey.

A comparison of these two groups of businessmen with the overall emigrant group shows no substantial differences before 1937. Although they had closer connections abroad and better possibilities for transferring capital out of Germany, parallels are more apparent than divergences. Given their relative material prosperity and their elevated social status, the deceptive feeling of being safe may have remained prevalent among successful businessmen in the early years. Many presumably shied away from emigrating precisely because the expected loss of wealth and property and the feared social loss of status abroad would have been that much greater. However, a clear deviation from the general rhythm of emigration is evident for the years 1938 and 1939. While only fifteen percent of all emigrants who left Germany between 1933 and 1941 left in 1938, around thirty percent of the businessmen who left did so that year. The ratio was almost reversed in 1939, which was the year that almost thirty percent of all emigrants left Germany but just eighteen percent of businessmen. One possible explanation might be that businessmen were already better prepared for emigration at that time and were then able to carry it out more quickly. How strongly the timing of emigration depended on the loss of one’s livelihood is revealed, for example, by the New York émigrés: nearly half of them (46.1%) left the Reich in the same year that they lost their positions in business, and an additional 16% in the year that followed the loss of position. Many thus clearly responded to the fact that new economic and business prospects would no longer be possible within Germany.

Early and Late Emigration – Case Studies

It has become clear that the initial and the final years of “Aryanization” in 1933 and 1939, respectively, constituted the high points of the emigration process; what follows are several case studies. Preexisting experience of personal, anti-Semitic attacks before 1933 may have caused many businessmen to react to the rampant violence that immediately followed the beginning of Nazi rule by deciding to emigrate “early” (from the perspective of later experience). One of the most prominent examples of this was the banker Jakob Goldschmidt (1882–1955), who had led the Darmstädter und Nationalbank (Danat) into the circle of major Berlin banks, and who at the height of his career sat on the supervisory boards of 123 domestic and foreign companies.[52] His aggressive business style, but also his origins from impoverished circumstances, had earned him criticism and rejection within the banking world. Above all, following the spectacular collapse of his bank, which had triggered an unparalleled financial catastrophe in the summer of 1931, he had been criticized by the press and the public. Anti-Semites like the future leader of the German Labor Front (Deutsche Arbeitsfront, DAF), Robert Ley, gave a harsh harangue:

Why is this hyena of the economy not instantly handed over to the public prosecutor? Where is the infamous summary judge? Why is the private wealth of this bloke not confiscated? For once make a clear and unambiguous example of someone, and it would be the end of all the stock-market knavery. Fine, let’s wait, the “third Reich” will deal with these vultures of German labor. Instead of Reich guarantee there will be gallows and the rope.[53]

In 1933, Goldschmidt had to fear that such threats would become reality, especially since his two brothers, who were businessmen themselves, were also being subjected to massive economic and personal pressure. Goldschmidt’s private office—according to the account of his lawyers after the end of the war—was searched by the Gestapo several times, and uniformed supporters of the party chanted outside his villa, “We want the Jew Jakob Goldschmidt to kill him!”[54]In the wake of the Reichstag fire on February 27, 1933, Goldschmidt, according to his son’s recollections, was warned that he and his family were in extreme danger. He had his son taken across the border to Austria in the trunk of a car and left a few days later for Zurich.[55]Goldschmidt finally settled in New York in 1936 and became involved in various American industrial enterprises.

While Goldschmidt’s business career had suffered a considerable setback in the banking crisis of 1931, Max von der Porten (1879–1943), the director general of the Vereinigte Aluminium-Werke AG (VAW) at Lautawerk in the Lausitz region, was still one of the most influential German industrialists in 1933.[56] The VAW was the world’s largest aluminum producer, and von der Porten sat on the supervisory boards of numerous metal-processing and electrical companies and belonged to many important associations. Only six weeks after power was handed over to the National Socialists, the local NSDAP chapter at the Lautawerk factory addressed a telegram to Hitler demanding, “with the utmost indignation,” the immediate dismissal of von der Porten and the appointment of a Reich Commissar to “purge” the works.[57]In the press, attacks were launched on von der Porten’s seat on the supervisory board of VIAG, the Reich’s holding company for its interests in industrial enterprises: “Do those in reactionary circles not know the National Socialist decrees that Jews must disappear from government offices? Or must it get to the point that the saboteurs of the will of our Führer will be taught the National Socialist understanding of the state in the concentration camp?!”[58]

Given the state’s ability to exert influence on the VAW, whose sole stockholder was the German Reich, and on other large companies of which von der Porten was a part, he was soon dismissed not only from the VAW but also from some thirty seats he held on domestic and foreign supervisory boards. Some press commentary criticized these actions, pointing to von der Porten’s contributions to building the German aluminum industry, his participation in the financial reorganization of large industrial enterprises, his proposals for a restructuring of the banking system, and his international reputation. “The departure… of von der Porten, who is still in the prime of his working life, is to be regretted… It surely leaves a serious gap,” one newspaper declared. “There are probably not many who have mastered the national and international aluminum business as he has.”[59]In spring 1933, von der Porten and his family emigrated first to Switzerland, where he participated in a British committee that was preparing an expert report on the possibilities of industrial development in Palestine. On December 1, 1934, he was then appointed for four-and-a-half years in Turkey as the chief advisor for the preparation and implementation of the industrial five-year plan.

In other cases, representatives from the business world made the conscious and far-sighted decision to leave Nazi Germany, and they carried out their emigration in a planned and systematic fashion. Among them was Siegmund Bodenheimer (1874–1966), who, in April 1932, was the only owner of the collapsed Danat Bank to be added to the board of the Dresdner Bank when the two banks merged.[60] As Bodenheimer recounted vividly in his memoirs, with the beginning of Nazi rule, a poisonous climate of rumors, denunciations, and accusations spread within the heavily Jewish banking sector.[61]For example, it was said that the entire board of Dresdner Bank would be arrested, and Bodenheimer himself was falsely accused of having granted his own brother an excessive bank loan.

After his contract expired on September 30, 1933, Bodenheimer withdrew from all his business activities and set in motion his family’s emigration from Germany. “Guided by the conviction that in a country sunk as low as Nazi Germany Jews could no longer hope for anything and had everything to fear,” Bodenheimer, his wife Rosa, and their daughter Helga left in March 1934: “We [shook] the dust (not to say: dirt) of Germany from our feet and journeyed… to Switzerland.”[62]Even though he emigrated at such an early time, the financial damage was immense and made the deterrent effect of the burden of taxes and fees palpable: Bodenheimer had to pay a Reich Flight Tax of at least 256,000 RM (in 1934 U.S. dollars: $101,000; in 2010 U.S. dollars: $1.64 million), and also a “Jewish Wealth Tax” of more than 67,000 RM (1934: $26,400; 2010: $430,000). When he transferred his remaining assets, he lost 443,000 RM (1934: $174,000; 2010: $2.84 million). In 1936, his family settled in the United States and “thus won a new, better fatherland.”[63]

The department store entrepreneur and publisher Salman Schocken (1877–1959) also emigrated with his family in 1934, although he did not lose his business property until the late 1930s. Schocken had co-founded the department-store chain Schocken KGaA, based in Zwickau. To the surprise of his family and friends, Schocken announced in December 1933 that he would be emigrating to Palestine. “‘Hitler’s gentle hand’ was pushing him toward Jerusalem,” Schocken’s biographer writes. “He and [his wife] Lilly still had children in school, and to avoid the public humiliation of exclusion Lilly insisted that he find ‘a suitable place where [they] could live and raise [their] children.’” Schocken returned to Germany repeatedly for business reasons, but in 1936 a controlling interest in Schocken KGaA was transferred to a British group. This may have been an attempt to evade confiscation, but the stake was seized by a German bank consortium in 1938 and eventually “Aryanized.” In 1931 he had founded the Schocken publishing house, which specialized in the books of Jewish authors; it, too, managed to survive the first years of Nazi control but closed in 1938. Meanwhile, Schocken had became dedicated to the Zionist movement in his country of refuge; he acquired the daily Ha’aretz, and founded a new Schocken Publishing House in Tel Aviv before moving to the United States in 1940.[64]

A more pronounced attitude of resignation categorized the response of Paul Silverberg (1876–1959), who, as the chairman of the supervisory board and former director general of the Rheinische AG für Braunkohlenbergbau und Brikettfabrikation (RAG), a company in the coal business in Cologne, had been among the central figures of the German mining industry.[65] Over the course of 1932 and 1933, the network of allies Silverberg could trust shattered, and at the height of his career he lost control over the RAG through the tactical maneuvering of the major industrialists Friedrich Flick and Fritz Thyssen. At the same time, the changed political conditions forced him to withdraw from ever more companies, associations, and organizations. Still, Silverberg enjoyed great esteem; he had even drawn close to the NSDAP in the hope that its economic plan would have positive results, and had approved of Hitler’s ascension to the chancellorship. As a result, he might have delayed his complete exclusion from the economic elite for some time yet, but his resistance was already broken in 1933. The circumstances surrounding his expulsion from the Reich Association of German Industry (Reichsverband der Deutschen Industrie) on March 29, 1933, and his resignation from the prestigious presidency of the Cologne Chamber of Industry and Commerce on April 5, 1933, soon prompted him to leave Germany for good. Financially secure, he took up residence in the Swiss town of Lugano in late 1933, where he resigned himself to the life of an émigré: on December 18, 1933, writing to a friend that he had made this diificult decision “after a long struggle… I remain a German, and loyal, but I have won back my freedom of movement. The end of my industrial career and of my work for the general interest I had imagined differently. But the development is stronger than I am, and I want to live the remainder of my life in peace.”[66]

Various motives and circumstances also influenced the decision to emigrate at the end of the “Aryanization” process. A few businessmen were able to maintain their position within German economic life fairly unchallenged until 1938, among them Otto Jeidels (1882–1947), who was among the leading bankers of the interwar years as the leading partner in the Berliner Handels-Gesellschaft (BHG) investment bank from 1918 to 1938. However, the longer emigration was postponed, the greater the danger became that prominent businessmen would also become victims of Nazi violence. This was demonstrated by the case of Arnold Bernstein (1888–1971), later one of the most successful German shipping magnates of the postwar period.[67]In 1928, Bernstein had founded the Arnold Bernstein Line, and in 1935 he had acquired the Anglo-American Red Star Line. He was one of the pioneers in the area of passenger shipping and the sea transport of uncrated US automobiles, and he was “the central figure in a spectacular success story in the North Atlantic steamship field.”[68] Bernstein had contemplated emigration as early as 1933 and had received the “first papers” for U.S. naturalization, but had encountered resistance from his wife, Lilli:

She was absolutely opposed to leaving. She detested the thought of leaving the house, her friends, and the city in which she was born and where she had lived comfortably all these years. But I remained firm and also made it clear to her that I would not be able to leave on a day’s notice. It would not be easy to transfer an entire fleet from one flag to another. Since the German government would never allow me to do that, this must be intelligently arranged and prepared well in advance.[69]

Bernstein continued his business in Germany until he was arrested on January 25, 1937, on the charge of having violated the currency laws.[70] Following a year-long trial based on an indictment of more than two hundred pages that was closely followed by the American press, Bernstein was sentenced to two-and-a-half years in prison. Over the course of the trial he was forced, under threat of the confiscation of his property and another prison term, to sell his shipping company and to transfer his majority interest in the Bernstein Line and Red Star to a government trustee. Bernstein was released again on July 7, 1939, only after American friends had paid a ransom of $30,000 ($471,000 in 2010 dollars).[71] He and his wife had to leave the territory of the German Reich within forty-eight hours, and they arrived in New York on September 1, 1939, the day World War II broke out. Driven by personal ambition, but initially impeded by a lack of capital, Bernstein began to create a new shipping line, founding the Arnold Bernstein Shipping Company in 1950 and the American Banner Line in 1957.

After the outbreak of the war, numerous other Jewish businessmen, large and small, were no longer able to leave German sovereign territory and save their own lives after losing their property. Some were deported, some chose suicide, and others fell into the hands of the Gestapo in countries occupied by the Germans and thus fell victim to the apparatus of Nazi terror and annihilation.

One tragic example was the banker Paul Wallich (1882–1938), who had been running the Berlin branch of the Frankfurt private bank J. Dreyfus & Co. since 1919.[72] In 1938, in the wake of the “Aryanization” of the Frankfurt parent house and the takeover of the Berlin branch by a Munich bank, Wallich had been given, as a condition for the transaction, a ten-year consultant contract with an annual salary of 50,000 RM ($20,000 in 1938 U.S. dollars; $311,000 in 2010 U.S. dollars). As a young man, Wallich had spent multiple stints abroad from 1907 to 1910 in preparation for his future work as a banker—in London, Paris, New York, and South America—and, given his international experience, emigration abroad seemed to offer a way out.[73] Nevertheless, Wallich’s ties to Germany were too strong for him to make the decision to leave the country permanently, especially since he had to expect a worse professional position and a lower standard of living abroad. Added to this was that he was presumably threatened with the termination of his contract in the fall of 1938.[74] By his own decision he returned to Berlin from a stay in New York, where the November pogrom and fear of being arrested made him flee to Cologne. Matters in Germany were “no longer bearable” to him, he wrote in a farewell letter to his son, and “I no longer have the energy to go abroad.” The last message to his wife also conveyed his despair: “I am so tired… All the thousand cares and bothers that would come with my starting over—I don’t even have the nerves to cross the border now, with or without passport.”[75] On November 11, 1938, Wallich drowned himself in the Rhine near Cologne.

Beyond the Borders: A New Departure in the New World

If we want to end with a brief look at the fate of German émigrés in the United States during the Nazi period who were forced to begin their professional lives anew, it becomes evident that the fate of thousands of “nameless” entrepreneurs, businessmen, and shop owners remains in the dark to this day, and that their history still needs to be written. But at least within the broader public, even many of the German refugees of the 1930s and 1940s who became major, influential businessmen again are fairly unknown. They include, for example, the above-mentioned Otto Jeidels, who in 1939 became a partner in the New York investment bank Lazard Frères and in 1943 vice-president of Bank America in San Francisco; Hermann Schülein, who was part of the leadership of Liebmann Breweries as managing director after 1936; and the major industrialist Jacob Michael, who used the stock holdings he was able to save to build up new diversified industrial companies on the East Coast of the United States.[76]

More likely to be familiar are the names of a few German publishers who were able to transfer elements of the German publishing industry to the United States and to contribute to its modernization and internationalization there. Let us recall, for example, Walter Johnson and Kurt Jacoby from Leipzig, who made Academic Press the top academic publishing house, or Kurt and Helen Wolff from Munich, who continued European business practices when they founded Pantheon Books and saw themselves as “highbrow publishers” (Kulturverleger) of the German type.[77] A prominent role was also played by Kurt Enoch from Hamburg, who after joining Penguin Books in the fall of 1940 turned the company into a paperback giant, using the imprint of the New American Library of World Literature, and became known as “Mr. Paperback.” His limited knowledge of English and the outbreak of the war made it more difficult to begin his new career. However, forty years later he recalled:

…the open-mindedness and appreciation of new ideas and performance, rather than consideration of origin or background, in this land of immigrants helped to make the last thirty years the most productive and successful of my life. From a haven, America has become a home; from a land of strangers, it is the anchor of our life, our hopes and aspirations; from the faraway land of mystery of my youth, it has become the point of departure for many travels and activities covering all continents of the world but – now proud of my American citizenship – a land to which I am always happy to return.[78]

Still, these success stories were in no way representative of all German emigrants, even if many businessmen were able to gain a foothold again in similar economic areas over the longer term. In many cases, after a period of uncertainty and also despair, there was only a slow renewed rise, and many immigrant companies remained much smaller than their proprietors’ businesses had been in Germany. Banker Hans Arnhold, for example, took charge of the New York branch of the private bank Gebr. Arnhold, which had been founded in 1928, after emigrating, and eventually built it into Arnhold & S. Bleichroeder, an international investment and financing bank. In Germany the firm had had more than one thousand employees; in New York it had fewer than two dozen (primarily family members and other refugees). “[O]ur relations here were not as well established as those who had grown up there… Here we had to ring the doorbells. Over there, they rang our doorbells. I think that’s where… there is a huge difference,” Hans Arnhold’s nephew Henry Arnhold recalled.[79]

As a rule, the new immigrants lacked contacts and especially capital. Not untypical therefore was a new beginning in the form of tiny enterprises that were run out of the living room and where the participation of many wives proved an important help. For example, Maria Ullstein (1902–1962) and her husband Karl (1893–1964), who had previously been the manager of one of the largest European publishing houses in Berlin, first thought about engaging in agricultural work but after settling in Manhattan began to hand-color black-and-white photographs. In 1942, Karl Ullstein professionalized his work by founding the Multicolor Print Co. and eventually entered into the trade with printing machines as a partner in the Printrade Machinery Corporation. But the business suffered from the state of the overall economy and eventually from the economic consequences of the Korean War that began in June 1950. In 1945 Karl Ullstein wrote that he had “fallen body and soul” for the United States and felt “very, very happy in this land,” but in July 1951 he and his wife returned to West Berlin, probably in response to their difficult professional situation.[80]

The difficulty of creating a new livelihood in an unfamiliar environment was also experienced by Moritz Wallach (1879–1963), who with his brother had run a popular shop for dirndls, traditional jackets, and fabrics in Munich.[81] In March 1938 Moritz was forced to sell his business. A few days after the November pogrom in 1938, the Gestapo had forced their way into his apartment and had confiscated art objects and furniture; the following spring he fled to New York with his wife Meta. There they rented a small apartment in Woodside, Queens, where sixty-year-old Moritz, completely penniless, began to build contacts with tradesmen from Europe and to manufacture furniture, lamps, and candlesticks. Moritz and Meta carved models and sewed and printed fabric. Initially they were able to rent a printing table and a dye kitchen in downtown Manhattan for $10 a day ($155 in 2010 dollars), before they set up their own workshop on 39th Avenue in Queens. In the fall of 1939 they were able to participate at an exhibition in the Empire State Building where products made by émigrés were on display; they were introduced to Eleanor Roosevelt, who ordered several blankets. They gradually managed to fill a market niche in the applied arts sector created by the lack of imported goods from Scandinavia, Italy, and Persia after the beginning of the war. In 1947, they acquired a former casino in Lime Rock, Connecticut, where they set up a “Hand Craft Studio” that Moritz Wallach ran until his retirement.

In spite of these difficult beginnings and some failures, it was not only the immigrants in the nineteenth century, but also the emigrants in the 1930s and 1940s who helped to shape the economy of the United States. And even when they were not successful as entrepreneurs over the long term, many of their descendants rose to hold important positions and became important personalities in American life. Among the most prominent was the popular musician Billy Joel (born 1949), whose grandfather Karl Joel (1889–1982) had founded a textile factory and a prosperous mail-order business for textiles, clothes, and fashion in Nuremberg in the late 1920s.[82] Karl Joel was forced to move the flourishing business to Berlin in 1934 and then sold it in July 1938 to a businessman named Josef Neckermann, who also moved into the family’s Berlin villa. The family managed to escape in the summer of 1938 via Switzerland and Cuba to the United States. Karl’s brother Leon, however, was on board of the St. Louis and had to suffer through the ship’s odyssey when it was forbidden to dock in the United States in June 1939 and returned to Europe; he is believed to have been murdered in Auschwitz in 1942. To keep the family afloat in New York, Helmut Joel, the son of Karl and his wife Meta, delivered mail and packages for the small company of a German who produced hair ribbons, which gave his father the idea to make such ribbons himself. Once the owner of one of Germany’s largest mail-order businesses, he and his wife began home manufacturing and sold ribbons, wigs, and toupees to five-and-dime stores like Woolworth’s. This was a dramatic contrast to the Joels’ previous life as a rising family of entrepreneurs; moreover, business was bad and sales remained modest. Only after long and grueling action did Karl Joel eventually receive a small portion of the original value of his former company back from Neckermann, who became the “mail-order king” in the German “economic miracle” of the postwar period. And after their son had already returned to Europe, Meta and Karl Joel resettled in Nuremberg in 1964.

Notes