Gustav Oberlaender

Introduction

Gustav Oberlaender (born June 2, 1867 in Düren, Rhenish Prussia; died November 30,1936 in Wyomissing , PA), a Rhinelander who spent his adult life in the United States, became a dominant figure in the full-fashioned hosiery industry. He and his partners, fellow immigrants Ferdinand Thun and Henry Janssen, used skills acquired in Germany to establish textile machinery and hosiery firms in the United States, undercutting their birth country’s exporters. Oberlaender made an even greater name for himself through his philanthropy, especially the Oberlaender Trust, dedicated to fostering greater transatlantic understanding by sending intellectuals between Germany and the United States. His story demonstrates how German ethnicity could be both an asset and a liability in the early twentieth century. Immigrant networks and affinities helped Oberlaender to establish himself in his adopted country, but his German connections in the era of the world wars brought suspicions of disloyalty, tarnishing his legacy as a businessman and a philanthropist.

Family and Ethnic Background

Much of the record on Oberlaender’s early life comes from his own account, which he placed in writing in 1936. He was born on June 2, 1867, in the Rhineland town of Düren, near Aachen. His parents were Wilhelm Oberlaender and Ida Bergerhoff. Oberlaender professed to have “no recollection whatsoever” of his father, who died of tuberculosis in April 1869. His mother then married Wilhelm’s brother, Fritz. Oberlaender recalled being frightened by “numerous quarrels,” and described his stepfather as “rather severe.” He had a sister, Emma, born in 1869, and twin half-sisters Clara and Anna, born in 1874. In 1876, Oberlaender lost both his mother, who had long suffered poor health, and his stepfather, who, like his father, had contracted tuberculosis. Clara, ill from birth, died a few years later at age five.

The wave of illness left Gustav, Emma, and Anna parentless, and the Bergerhoff family took them in. The sisters moved to Linden, while the elder brother moved in with his uncle, Hugo Bergerhoff, in Hagen, Westphalia. Oberlaender spoke more positively of this uncle than of his uncle-turned-stepfather. Hugo was “very good natured, kind hearted … never gave [Gustav] a cross word, and never beat [him].” Well educated, Hugo frequently tutored his young nephew, who remained appreciative decades later.

Following public schooling, at age ten Oberlaender entered the Realgymnasium (secondary school) in Hagen. It was here that classical studies ignited in him a passion for Greek and Roman culture and “the great statesmen, the poets and writers.” He cited this instruction as the reason for the “humanitarian aspect” of his life, as exemplified by his long record of philanthropy. At age thirteen, Oberlaender moved with his uncle to Düsseldorf. Having come from a stricter environment in Westphalia, he adapted all too quickly to the more lax atmosphere of his new school. Twice, he recalled, his bad behavior resulted in his being held back. But it was in Düsseldorf that he began instruction in English, and he described his years there as “the happiest of [his] life.”

Upon conclusion of his schooling, Oberlaender placed an advertisement in the local newspaper seeking an apprenticeship. The result was a three-year period of instruction at the offices of C. H. Erbslöh, a chemical wholesaler. Like a Rhenish Horatio Alger character, Oberlaender proudly recalled that he “started at the bottom, office boy, calling for the mail [and] copying all letters.” The experience as an unpaid apprentice helped to instill in him a “business interest,” which he considered key to his later achievements in the United States. He became proficient in shorthand, allowing him to interact directly with the head of the business, and he received bonuses each of the three years he spent at the firm. On the whole, he said, the apprenticeship provided several formative experiences, the most important of which was a strong work ethic. “Loafin[g] was a word not in our dictionary,” he wrote.

Born in the predominantly Catholic Rhineland, and eventually marrying the American daughter of a Methodist minister, Oberlaender does not appear to have been particularly religious. He said little on the subject in his 1936 autobiography, save a single anecdote from his third year in Realgymnasium. According to Oberlaender, he applied his geology lessons to refute the Biblical creation story during a religion course. His instructor, a Catholic priest, thereafter regarded him with hostility. “The incident,” he wrote, “created my first doubt in Christian religion!”

If not particularly religious, Oberlaender wove into his life story a practical, business-minded system of values worthy of any Horatio Alger protagonist, or perhaps even of Benjamin Franklin. In his autobiography and in interviews, he cited simple virtues such as hard work, thrift, and high personal standards as the reasons for his eventual success in America. Yet he also pointed to life lessons that he brought from Germany. It was in his classical education in the Realgymnasium, for instance, that he learned the age-old lesson: “Audiatur et altera pars” (“Hear the other side”). He considered this basic rule to be a “deciding factor” in his eventual success in the hosiery industry, where he anticipated the concerns of jobbers and consumers. Similarly, his year of obligatory military service in Germany taught him that “a man that cannot obey cannot command,” a lesson he found useful in climbing entrepreneurial ladders.[1]

Emigration to America

In an interview later in life, Oberlaender reflected on the stamp collection he had as a child. The attractiveness of American stamps, he said, had spawned his “first inclination” to emigrate. By young adulthood, however, there were additional factors. When Oberlaender completed his apprenticeship in 1888, C. H. Erbslöh offered to move him into a clerk’s position. By this time, however, he had begun to chafe under the strict rules of his uncle’s household and resolved to strike out on his own. Using his apprenticeship bonus to buy a second-class ticket, Oberlaender embarked on the S. S. Waesland in April 1888, arriving in New York on May 2. He took up lodging there with yet another uncle, Hermann Bergerhoff. He returned to Germany the following year to fulfill his one-year military obligation, but for the rest of his life he made his home in the United States.[2]

Arriving just after the historical peak in German immigration, Oberlaender resembled demographically many of those who moved to America at the time. While the largest numbers, unlike him, came from northeastern Germany, he and they constituted a shift away from the middle-class family migration that had predominated earlier in the nineteenth century. By 1890, German migrants were largely single, propertyless, and looking for urban employment. Yet if his own account is true, Oberlaender did not depart Germany due to a lack of employment there, usually a common push factor for German migration. His apprenticeship had ended well, after all, and he could have received a permanent position. The stronger factor, at least in his own retrospect, was the pull of greater perceived opportunities in America.[3]

Oberlaender started near the bottom in New York in 1888, securing a job with a book and periodical importer at 19 Dey Street. He addressed packaging labels, moved stacks of newspapers with the hand-powered elevator, and carried shipments to the post office. He also joined the German Shorthand Society, which introduced him to the typewriter and enabled him to keep tabs on employment prospects. Like many German organizations at the time, the Society facilitated Americanization, teaching him English shorthand to aid him on the job market. Oberlaender ultimately received a more lucrative position at the C. B. Richards & Co. banking firm, a position he then vacated to fulfill his military obligation to the Reich.[4]

One of the most important friendships he made was with another emigrant named Ferdinand Thun, who was one year his senior. The two men met around 1889 at a boarding house in New York. Oberlaender was making approximately $24 ($587) a week at the time, while Thun earned $5 ($122) at the Sutro Braiding Company. After meeting as housemates, the two attended the German Shorthand Society meetings, went to Coney Island and the Opera together, and visited Sunday meetings of the Ethical Culture Society where they listened to the lectures of Jewish humanist Felix Adler. They were regulars at a German beer hall on Third Avenue, where they discussed “philosophical problems.” While serving in the German military the year after they met, Oberlaender visited Thun’s family in Barmen, Germany, and through them maintained correspondence with his friend, still in New York.[5] Oberlaender moved to the United States a second and final time in October 1890. Anxious to resume his climb up the socioeconomic ladder, he briefly returned to his banking job but quickly decided that his future lay elsewhere. A friend from the German Shorthand Society secured him a “highly agreeable and interesting” job at the Steinway & Sons piano company, founded in 1853 by a fellow German, Henry Engelhard Steinway. The firm not only showed leniency regarding his limited English, but his native tongue quickly proved an asset. He found himself transcribing the German correspondence of William Steinway, Henry’s son. In the process, he cultivated a personal relationship with his employer.[6]

Conscious of the need to better his English, Oberlaender lived with his uncle for only a short time after his first arrival in New York. He then moved through a series of boarding houses, where he and other immigrants communicated in their common, but second, language. In 1889, Oberlaender finally settled into a residence at Abingdon Square that was owned by a Methodist preacher. Returning to it in 1890 after completing his military obligation in Germany, he became increasingly well acquainted with Alice Penny, daughter of the owner and an employee of Vogue magazine. After over five years of courtship, the pair married at Calvary Methodist Episcopal Church on June 29, 1895.[7]

Oberlaender first became an entrepreneur in 1896, thanks largely to an old friend from Germany. Richard Lieber, who had been a fellow intern at C.H. Erbslöh in Düsseldorf, had relocated to Indianapolis, Indiana. Lieber invited Oberlaender to join him in a new soda water enterprise, funded in large part by Lieber’s cousin, the president of the Indianapolis Brewing Company. Oberlaender cast his $600 ($16,100 in 2010 dollars) in savings into the partnership. Weathering two shaky years, the business finally turned a small profit in the third, when it expanded into importing German wines and then beer and whiskey, which were more popular—and profitable—products. “The first $1,000” ($26,800), Oberlaender recalled, “were earned by mighty hard work, great sacrifices, and frugal living.”[8]

The young Oberlaender family lived on Bright Street in Indianapolis. After relocating there, Oberlaender joined the local Deutsches Haus and Männerchor. While his wife and mother-in-law became active in a church down the block, Oberlaender spent much of his day conducting business with saloonkeepers, who, he opined, generally possessed “a rather low moral attitude.” Ultimately, Richard Lieber opened a restaurant whose success bolstered the business partnership.[9]

The steady ascent of the enterprise meant that Oberlaender worked increasingly hard to balance his time and funds between work and family. Alice gave birth to a daughter, Dorothy Alice, in 1899, the couple’s only child. Oberlaender proudly recalled that, at age one, she “piped a Christmas Carol” during a holiday gathering at the Männerchor. On a 1902 business trip to Europe, Oberlaender traveled alone, living frugally to save money for the family. Three years later, he brought his family on a business trip to California, in the process exhausting a small savings fund for his daughter. His wife and daughter vacationed in Los Angeles while Oberlaender continued on to Hawaii, Japan, and China. Unbeknownst to the young businessman at the time, his career was soon to take off.[10]

Business Development

On June 2, 1905, the Oberlaender family returned from their travels in the West and Far East to Indianapolis. Securing a number of loans and new investors, Oberlaender and Lieber purchased James R. Ross & Co., Indiana’s largest whiskey business. By this time, however, Oberlaender had grown weary of the liquor business, observing that the steady consumption of his wares was negatively impacting his health. As a result, he sold his stake in the business on April 1, 1906, taking his $15,000 ($375,000 in 2010 dollars) of equity and heading out in search of a new venture. He made the most significant decision of his business career when he almost immediately accepted an appealing offer from his old friend Ferdinand Thun and Thun’s business partner, Henry Janssen.[11]

Thun and Janssen were born six days apart in February 1866 in Barmen, Germany, a major center of the Rhenish textile industry. Their first meeting, however, would be on the other side of the Atlantic. Thun had migrated to New York in 1886, but he returned to Barmen to gain experience in the production of German braiding machines. He again came to America in 1889, receiving a position at Santos Brothers Braid Co. in New York. Janssen migrated in 1888, becoming a machine shop foreman at Castle Braid Company in Brooklyn. After striking up a friendship in 1890, the two decided to take advantage of the increased cost of imported braiding machinery imposed by the McKinley Tariff. Relying on their training in the Rhineland, they set out to build the machines in the United States, thereby undercutting the cost of machines imported from Germany.[12] In 1892 the pair established Textile Machine Works, a braiding and knitting machinery firm, in Reading, Pennsylvania, sixty miles northwest of Philadelphia. The plant moved to Wyomissing four years later, and that Reading suburb became their company town. With half the nation’s hosiery output in the state by 1900, Pennsylvania was becoming the industry’s home, and Thun and Janssen stood poised to feed its growth.[13]

After a period of stagnation due to overproduction, the American hosiery industry had experienced a boom during the U.S. Civil War, as military uniforms fostered a surge in demand. After the war, a public now more accustomed to factory-made woolen clothing helped to sustain a high volume of sales. A classic study of the industry notes that, while the American population doubled from 1860 to 1890, industrial production of hosiery multiplied by a factor of fifteen, at the same time transitioning from wool to cotton as the staple material. Hosiery at the time might be full-fashioned, meaning that it was mechanically knit on a flat surface and sewn into a tube; or seamless, produced on a circular knitting machine. Although tariffs constricted imports of knit goods, an overwhelming proportion of the foreign-made products came from areas that, after 1871, had unified into the German Reich.[14]

Thun and Janssen elbowed their way into the cotton hosiery business, fighting against the well-established firms in Philadelphia. After several experiments, in 1900 they patented a full-fashioned stocking knitting machine that matched imported rivals and gave the Textile Machine Works an edge. In 1906, the partners began vertically integrating into other aspects of the hosiery production process. They opened the Berkshire Knitting Mills under the leadership of Thun. Janssen continued to head the Textile Machine Works and soon took control of a new venture, the Narrow Fabric Company, making braided cord. They also developed their own foundry to produce the required machine parts. Together, these various elements constituted Wyomissing Industries.[15]

Having divested himself of the liquor business, Oberlaender reached out to Thun for a job in April 1906. Thun and Janssen offered him a position at the Berkshire Knitting Mills for $25 ($625 in 2010 dollars) a week, an amount that disappointed him. Still, sensing potential in the nascent enterprise, Oberlaender canceled a family trip to Germany and joined the firm on May 1, 1906, moving into the Wyomissing Hotel in Reading. Briefly returning to the bottom of the ladder once again, he took on multiple roles, including “office boy, stenographer, typist, bookeeper [sic], [and] treasurer.” He studied the stocking trade inside and out, even making the sixty-mile trek to Philadelphia three times a week to attend a dyeing course. He quickly advanced, becoming general manager of the Berkshire Mills and joining Thun and Janssen at their evening planning meetings.[16]

One of the ways that Oberlaender distinguished himself was by reducing Berkshire’s unit costs. When he came to the Berkshire Mills, the firm was losing money in its stocking sales, a situation that he set out to remedy. Following Janssen’s suggestion, he sought higher quality dyers in Philadelphia. He also made preparations to sell to jobbers, rather than to stores, a tactic employed by many competitors in the industry. Recalling the exhortation to “hear the other side,” a lesson from Realgymnasium, he pushed qualities higher so that agents would realize a higher profit, thus encouraging more active selling on the part of the jobbers. The result, he boasted in his autobiography, was increased turnover.[17]

The strategy of using jobbers notwithstanding, the rise of high-volume retailers and department stores was forcing the industry to adapt. Because these large customers placed less emphasis on variety, firms like Berkshire Mills reduced the numbers of products in their lines, even offering exclusive styles to retailers. Oberlaender first employed the strategy in 1907, sending out feelers to the Chicago-based Marshall Field & Co. The resulting contract vastly increased sales, necessitating the construction of a new three-story factory building in Wyomissing. The building, which added another two stories in 1910, reflected the steady growth of the business. Through the 1920s, the Berkshire Mills confined its line to seven styles, at least two of which were exclusive to large buyers.[18]

The Berkshire Mills weathered the Panic of 1907 by improving the quality of its hosiery. As skirt lengths were now ascending above the ankle, the company responded to the consequent demand for more attractive hosiery. Upgrading its machinery, the Berkshire Mills began mercerizing cotton, treating it with chemicals to give it a shiny, silk-like appearance. The result, Oberlaender recalled, was that the company offered “the finest stocking on the market in that line.” Despite the fact that its finances had been shaken by the Panic, the Berkshire Mills secured a loan from the Farmers National Bank of Reading. Out of gratitude, Oberlaender maintained the company’s account with that bank until his retirement as company president in 1926.[19]

The First World War and the Interwar Period

The Berkshire Mills and its sister companies had largely German ownership, they competed in an industry with strong German connections, and they operated in a heavily German area of Pennsylvania. Not surprisingly, the outbreak of war in Europe in 1914 posed a number of difficulties. Until then, Berkshire and its competitors had relied on imported German dyes for hosiery production, and the American embargo on belligerents therefore posed a problem. Oberlaender joined a January 1916 delegation of representatives from the textile industry that unsuccessfully lobbied President Wilson to ease the restrictions on German imports. It is likely that cultural affinities played at least some role in this effort alongside business interests.[20]

Compared to some German-American businessmen’s overt support of Reich propagandists, lobbying on behalf of the textile industry appears benign. Yet their acquaintances both in Germany and in German-America brought scrutiny to the Wyomissing partners, especially in the context of the anti-German hysteria that accompanied the American declaration of war in April 1917. To be sure, the Wyomissing foundry actively fed the war effort, supplying the U.S. military with machine parts for munitions production. But the partners drew suspicion for their personal connections to figures like Hugo Schmidt of Deutsche Bank, who was interned during the war for allegedly aiding German business interests and propagandists. In addition, the partners donated to ostensibly charitable German organizations between 1914 and 1917. As a result, federal agents searched the Wyomissing firms for German propaganda in 1918, although no charges resulted.[21] After the war, Thun and Janssen contributed substantialsums for widows and orphans in their hometown of Barmen, an act that placed their names on the city’s street signs. They contributed to the American Society of Friends’ effort to feed starving German children after the war.[22] While there is no record of Oberlaender’s participation, it is likely that he aided his partners, as the three generally collaborated in their charitable efforts.

Despite the unique problems presented by the war, the era of Oberlaender’s leadership (1906–1926) was one of steady growth and prosperity. A contributing factor was the business savvy highlighted in Oberlaender’s autobiography, but the Berkshire Mills also benefited from a number of external factors. Although it disrupted the supply of vital German dyes, World War I curtailed, and then halted, knitting machinery imports, offering protection to domestic equipment manufacturers. As a result, between 1913 and 1926 the annual production of full-fashioned knitting machines in the United States rose from 100 to 1,000. At the same time, the wartime economy caused a jump in the number of working women with disposable income, boosting demand for full-fashioned hosiery. A related factor, the growing acceptance of shorter skirts, continued into the 1920s, further accelerating consumption. As skirts rose ever higher, the Berkshire Mills produced ever finer stockings, ultimately transitioning to silk, both reflecting and driving consumer desires. By the time Oberlaender retired from the mills in 1926, it was the largest full-fashioned hosiery producer in the country. From its original 12,000-square-foot facility, it had grown into a five-building compound, with workspace totaling 428,844 square feet.[23]

As it grew and prospered into the 1920s, the Berkshire Mills and its sister companies took a number of paternalistic steps to aid their workers. In the inflationary economy of the World War I era, the firms allotted plots to workers so that they could grow their own “war gardens” on company land. They also created a cooperative store to sell basic staples to employees at cost. This adaptation survived the war, becoming a company store that operated branches in all of the firms’ various divisions. In addition, in the 1920s the Wyomissing partners erected a medical dispensary, a cafeteria, and a library, and they founded an insurance program for their employees. At the Berkshire Mills, Oberlaender took advantage of the prosperity of the 1920s to issue periodic bonus payments to employees. This action, along with the “well planned supervision of employee welfare,” was a point of pride for the Wyomissing firms.[24]

Citing poor health, Oberlaender sold his interests in the Wyomissing Industries to his partners in February 1926. The Reading Eagle printed a glowing survey of his life, one that echoed the sentiments he later set out in his autobiography. The paper gushed that “no ‘success story’ ever published by the periodicals … is more interesting, more romantic, than the career of Gustav Oberlaender.” “He has no magic touchstone,” it continued, attributing his success to “hard work, intensive application, uncompromising honesty, [and] insistence on thoroughness.” Although he had sold his stake in the Berkshire Mills, he continued as general manager for several more years. He also spent 1926 serving as the elected chairman of the National Association of Hosiery and Underwear Manufacturers.[25]

The hosiery industry saw “almost uninterrupted expansion” until 1930, as both demand and production swelled, but the Great Depression drove the industry into crisis. National output of full-fashioned stockings fell from 20 million pairs in 1929 to 15 million in 1931, reflecting reduced demand for higher-quality hosiery. Another challenge was extreme instability in the price of silk, an imported material whose value to the hosiery trade was steadily increasing.[26] As the Depression wore, on, an even more serious problem arose from the labor force, with which the Berkshire Mills had long touted a healthy relationship. Largely because of its benevolent policies, the firm kept its workers off the picket lines, and out of unions, in the first years of the Depression. Eventually, however, labor conflict made its way into the Berkshire complex.[27]

With the passage of the National Industrial Recovery Act on June 16, 1933, the federal government vastly increased its scope of activity regarding labor relations. The new National Recovery Administration (NRA) set industry-specific codes to regulate, among other things, wages and hours. The Textile Code, the first of these systems, initially covered the hosiery industry, although a more specific code went into effect in late July. The code mandated a forty-hour work week, as well as minimum wage requirements. Furthermore, the Act committed the federal government for the first time to recognizing a worker’s right to unionize.[28]

The impact of the new government stance was a massive organizing drive throughout the American workforce and, consequently, a surge in labor unrest. The hosiery industry around Reading, Pennsylvania became central to the unfolding drama. In the wake of the new federal stance, the American Federation of Full-Fashioned Hosiery Workers swept into Berks County to organize the local mills. Predictably, employers resisted, asserting that forces external to Reading were orchestrating the unrest.[29]In June 1933, 18,000 workers went on strike at thirty-three Reading plants, including, for the first time, the Berkshire Mills. The strike dragged on until the NRA’s new National Labor Board took on the dispute as its first major case. After four hours of mediation, the Board announced a settlement, effective August 21. Employees were to return to work and elect representatives by secret ballot. In the event of a future dispute, labor and management were to return to the board for further mediation. The board hoped that the agreement, known as the Reading Formula, would serve as a precedent for further disputes.[30]

The agreement did not work in Reading, let alone elsewhere. While workers at most plants overwhelmingly elected the hosiery union as their representatives, they soon accused the owners of violating the spirit of the Reading agreement by holding only token meetings with labor delegations. Many employers, including Berkshire Mills, established company unions to undercut the independent representatives. It quickly became apparent that the National Labor Board was virtually bereft of enforcement power. The dispute continued for much of the decade, culminating in an often violent thirteen-month strike at the Berkshire Mills in 1936–37, as the national union attempted once again to force recognition. In the end, the company succeeded in preventing its workers from joining the national union, although the government eventually forced it to compensate the strikers.[31]

Philanthropy and German Influences

While Oberlaender was still involved in business affairs after 1926, the mid-1920s marked a shift to a new phase of his life, one focused around philanthropy. He had followed Thun and Janssen into the hosiery business, but he made a larger name for himself in the realm of charitable contributions. Many of his efforts survived into the twenty-first century, some even bearing his name. The Reading area benefited greatly from all three Wyomissing partners’ largesse. In 1925, Oberlaender joined Thun and Janssen in donating land and money to the Reading Public Museum. They lent considerable support to the Reading Hospital, located in West Reading next to Oberlaender’s palatial home. Oberlaender donated his time, as well, serving on the hospital’s board. Their wives having long been active in the Wyomissing Public Library, and Mrs. Oberlaender having earlier served as its chairwoman, the partners built the facility a new home in 1931. They also donated to local colleges, including $75,000 ($1 million in 2010 dollars) toward a professorship in German at Franklin and Marshall College in nearby Lancaster. In 1935, Oberlaender created his own Foundation for Education and Charity, endowed with $500,000 ($7.9 million in 2010 dollars), to create scholarships and grants to the region’s academic institutions.[32]

Citing his classical education in Germany, Oberlaender nurtured a lifelong interest in Greek and Roman civilizations that shone through in his philanthropy. He underwrote excavations in Greece, Italy, and Turkey, often in collaboration with the University of Pennsylvania. Projects of particular interest in Italy were the Via Appia, the ancient road that connected Rome to Naples, and the city of Minturnae, a project that required special permission from dictator Benito Mussolini and earned Oberlaender a special commendation from the Italian monarch. In Greece, Oberlaender funded the excavation of Kerameikos, an Athenian cemetery dating back to the 12th century BC. The cemetery’s museum, which opened in the 1960s, still bears his name.[33] Oberlaender brought his cultural pursuits back to Pennsylvania with him, both figuratively and literally. He frequently lectured on his excavations to classes and associations in the Reading area. Albright College, a local institution, even bestowed on him a lectureship for that purpose. His own private museum featured an array of furniture, artwork, and artifacts collected abroad, and his home featured a hanging garden and an ancient wall, both imported from Italy.[34]

Oberlaender’s philanthropy also reflected his continuing affinity for Germany, the country of his birth. He traversed the Atlantic regularly, even making a trip in 1936 on the Hindenburg, the ill-fated zeppelin that crashed the following year. On one voyage he returned to his Realgymnasium in Düsseldorf, presenting his former headmaster with a grant to provide “prizes for excellence in English.” Along with Thun and Janssen, Oberlaender donated $100,000 in 1931 ($1.43 million in 2010 dollars) to the University of Heidelberg and received an honorary doctorate for his contributions to excavations. The exiled Kaiser Wilhelm invited Oberlaender to his home to discuss his archaeological projects in 1929, and in 1932 he received the Goethe Medal for Arts and Sciences from President Paul von Hindenburg.[35]

The passion for philanthropy and the commitment to transatlantic cultural exchange culminated in the Oberlaender Trust. The trust was effectively a branch of the Carl Schurz Memorial Foundation (CSMF), a Philadelphia-based organization whose honorary president was Ferdinand Thun. Founded in May 1930, at a time when ethnic organizational leaders sought to reverse what they saw as the Anglicization of German-Americans, the CSMF dedicated itself to the preservation of German culture in the United States. Avowedly an apolitical organization, the CSMF drew a largely elite membership that cut across religious and political lines. While all three of the Wyomissing partners were active in its founding and early operations, Oberlaender decided to go even further to make his own personal, lasting contribution.[36]

In 1931, Oberlaender donated $1 million ($14.3 million in 2010 dollars) to establish his namesake trust. The purpose, he said, was to promote “a better understanding of the German-speaking peoples by the American people, and vice versa.” The chair of the board of trustees was to be the executive director of the CSMF, a requirement that bound the two organizations closely. Oberlaender’s other instructions established the trust as an active and dynamic institution. First, he mandated that the entirety of the fund, including interest accrued, was to be exhausted within twenty-five years. Second, he left the trustees with great leeway in shaping and adjusting the mission of the trust. He did ask that they maintain the goal of sending intellectuals to Germany to study issues of “public welfare.” Beyond that request, however, he left the decisions to the board.[37]

In its early years, the trust followed Oberlaender’s instructions closely. It gave grants to “American citizens who are actively engaged in work that concerns the public welfare … and who will profit by a period of study in a German-speaking country.” The list of Oberlaender Fellows ultimately included hundreds of names. Among them were Jane Addams, the settlement worker who founded the famous Hull House in Chicago, and W.E.B. Du Bois, the civil rights activist and co-founder of the National Association for the Advancement of Colored People. In addition to supporting individuals, the trust funded intellectual exchanges on the organizational level. It sent American municipal officials to learn German methods of city planning and administration, for example. In 1934, it sent a group of American foresters and lumbermen to Germany and Austria to study conservation and resource management. Oberlaender, traveling in Germany at the time, personally visited the foresters to see for himself the success of his grant. Upon their return, the foresters and city managers published their recommendations for implementing European methods in an American setting.[38] Such work was further testimony to Oberlaender’s commitment to international intellectual exchange, but geopolitical realities of the 1930s soon demonstrated that this ostensibly apolitical activity was not immune to controversy.

The Problem of Nazism and Oberlaender’s Legacy

Naturally, the rise of Nazism caused problems for those seeking to improve German-American relations. The Oberlaender Trust and its partner, the Carl Schurz Memorial Foundation, were no exceptions. An early indication of trouble was an organization in Germany, the Vereinigung Carl Schurz (Carl Schurz Association, VCS), that had collaborated in cultural exchanges with the CSMF since its founding. By 1933 the VCS had become a pro-Nazi entity. As it continued to foster transatlantic exchanges in the 1930s, it referred to itself in English as the “Carl Schurz Foundation,” a less accurate translation of Vereinigung that sounded suspiciously similar to the name of the CSMF. The American foundation and the Oberlaender Trust publicly distanced themselves from the Nazified VCS, while they continued to collaborate with it in sponsoring cultural exchanges. Even William Dodd, the American ambassador to Germany, conflated the organizations. Writing in his diary about German meddling in the United States, Dodd erroneously stated that the Oberlaender Trust was underwriting the pro-Nazi VCS. It did not help, of course, that Reich Propaganda Minister Josef Goebbels praised the Oberlaender Trust in an October 1933 speech calling for German-American support of Nazism.[39]

Suspicion also fell on Oberlaender and his business partners for more obvious reasons. On several occasions between 1933 and 1936, the Oberlaender family traveled to the Reich, where they regularly met with Adolf Hitler and Goebbels. In March 1934, Alice Oberlaender spoke to a Wyomissing women’s organization about one such trip, noting that she was “favorably impressed by the developments in Germany under the Hitler regime.” Two years later, she told a reporter about a recent trip to Heidelberg in which the Oberlaenders had sat at Goebbels’s table during a banquet and had ridden in his private automobile.[40] To be sure, Oberlaender and his partners publicly disavowed the Führer’s treatment of Jews as early as 1934. Oberlaender, who had Jewish friends and business associates in Germany, described Hitler’s anti-Semitic views as unjust. Janssen, too, distanced himself from the treatment of the Jews in Germany, while Thun, when pressed by reporters, declared his disinterest in the issue. Oberlaender and Janssen even claimed to have angered the Führer by personally urging him to curtail his regime’s attacks on the Jews.[41]

Not all of the partners’ impressions of Nazi Germany were negative, however. The three men were in Germany during the “Night of the Long Knives” in July 1934, when the Nazis conducted a violent intraparty purge and killed political opponents. Meeting with Hitler that month, Thun and Janssen advised him that transatlantic conversations among elites would help to improve the Reich’s image in America. When Oberlaender returned home, he told the Reading Eagle that the purge had improved Hitler’s standing with his people, and he dismissed any resentment as the result of excesses by some of Hitler’s followers. Notably, even in the interview in which he disavowed anti-Semitism, Janssen stressed his generally favorable view of Hitler’s Germany.[42] These public positions were consistent with those of other conservative German nationalists both in Europe and in the United States. Many conservatives celebrated parts of the Nazi program while ignoring, downplaying, or tacitly supporting the persecution of the Jews. Such individuals often dismissed the regime’s violence as the excesses of a few followers, or even rationalized that Nazism itself was a transient phenomenon.

The exact extent to which the partners adopted a similar viewpoint is impossible to discern.[43] Following their trip, the three partners drew contrasts between events in Germany and the ongoing labor struggle in the Pennsylvania textile industry. While declining to comment directly on the Wyomissing strike to the Reading Eagle, Oberlaender pointed out that “there has been less disorder in Germany than in the United States, where strikes are progressing everywhere.” Henry Janssen was less subtle in commenting on the textile strikers: “When radicals try to start trouble of that sort [in Germany] the government gets them right away and they are soon taken care of.”[44]

The strikers themselves saw connections to events in Germany, albeit from a different perspective. They seized on the fact that the Oberlaender Trust sent local officials, including Reading’s school superintendent and the head of the city recreation department, to visit counterparts in Germany. The Federated Trades Council of Reading publicly criticized the travel grants, declaring that “nothing learned in Nazi Germany could safely be introduced into democratic America without threatening the life, liberty, and pursuit of happiness of the working man.” Strike supporters also accused the company union of keeping close ties with the pro-Nazi German-American Bund, which had a significant presence in Reading.[45] Accusations such as these became more serious, and more widespread, in the years leading up to World War II. Had Oberlaender lived long enough, he likely would have had to clarify publicly his relationship with the Reich. As it happened, the fallout from these connections threatened to contaminate his legacy after his death.

Oberlaender suffered a heart attack in mid-November 1936, but initially appeared to be recovering. On the evening of November 30, he went for a leisurely drive but returned home feeling unwell. By the time his wife could summon a doctor, Oberlaender had succumbed to a second heart attack. He left behind an estate that included $677,000 in cash and $83,000 in art (or $10.7 million and $1.3 million, respectively, in 2010 dollars). His front-page obituary in the Reading Eagle, which hailed his “brilliant career,” also described Adolf Hitler as “one of his close friends,” portending the controversy that would soon ensue.[46]

The Reading unions may already have had axes to grind with Oberlaender when they attacked his trust, but they were not the only ones questioning the motives behind cultural exchanges with Germany. By December 1938, the U.S. State Department, too, began to wonder whether the Oberlaender Trust’s intellectual exchanges with the Reich were completely innocuous. Suspicions soon grew in another federal department, which investigated Oberlaender himself. In December 1939, the Carl Schurz Memorial Foundation moved its headquarters into the Old Philadelphia Custom House, administered by the Interior Department. A few months later, Secretary of the Interior Harold Ickes caught wind of allegations that some the CSMF’s founders, including Henry Janssen and the late Oberlaender, evinced pro-Nazi sentiments. A confidential report cited the Wyomissing partners’ favorable statements on Nazi Germany in the Reading Eagle. The Interior Department ultimately concluded that the Foundation was “muddled rather than subversive,” but the allegations of pro-Nazism clearly stuck with Ickes. He threatened the Foundation with eviction unless it openly disavowed Nazism, which it finally did in September 1940.[47]

The episode also drew the attention of the Non-Sectarian Anti-Nazi League, dedicated to boycotting Nazi Germany and exposing German agents in the United States. Like Ickes, the League had found statements by Oberlaender and Janssen that they considered sympathetic to Nazism. The League asked for guarantees that the CSMF was “independent of the financial aid” of the hosiery magnates. In his reply, the executive secretary of the Foundation downplayed connections to Oberlaender, who, he said, had only been one of five executors of his namesake trust. In any case, Oberlaender had died two years earlier, the secretary added. Thus, in the tense political atmosphere of 1940, an organization that owed much of its success to Oberlaender had to distance itself from him.[48]

In truth, the CSMF and the Oberlaender Trust had already shifted their work to avoid the controversy brought on by possible connections to Nazism. Ending cultural exchanges, they now focused on providing academic grants to refugee intellectuals from the Reich, placing them in American universities and institutes. By 1943, they could name 288 refugees who had received their support, and the trust ultimately expended one-fourth of its endowment on this effort. The list included Marxist scholar Ernst Bloch, historian Dieter Cunz, socialist author Oskar Maria Graf, novelist Heinrich Mann, and political scientist Leo Strauss. In addition to this effort, the CSMF and the Oberlaender Trust cultivated a relationship with Assistant Secretary of State Adolf Berle, who asked for their help in “safeguarding what is left of classic German civilization.” Convinced of the organizations’ Americanism, Berle helped to persuade the Treasury Department not to freeze the Trust’s assets during the war, although the CSMF lost its tax exemption for four years. Endangered by suspicions about its founder’s political beliefs, the Trust managed to steer through the controversies. It even worked with the State Department to sponsor cultural events in postwar Germany, most notably the rededication of the Paulskirche, home of the 1848 Frankfurt Assembly, on its 100th anniversary. The trust exhausted the last of its assets in 1953, in accordance with Oberlaender’s original instructions.[49]

Decline of the Berkshire Mills

The Berkshire Mills continued to prosper for a few years after Oberlaender’s death. During the war, with private consumption restricted, the firm produced socks and gloves for the United States military. Per capita consumption of hosiery continued to rise into the 1950s, although the Wyomissing partners made a rare misstep with regard to a new product: nylon. When adopted in the hosiery industry, the synthetic fabric freed producers from the whims of the international silk market. In addition, nylon enabled circular-knit stockings to become permanently form-fitting, giving the producers of seamless stockings a new advantage over full-fashioned knitters. From their first introduction to consumers in May 1940, nylon stockings were an instant success. The requisitioning of nylon for military purposes during World War II suppressed the trend, but in 1945 consumers again rejected rayon and cotton, driving demand for the new material. Janssen and Thun, wedded largely to full-fashioned products, never gave in to the allure of the new material, however. Their firm came late to the seamless hose business, not adopting a production line until 1955, well after their respective deaths in 1948 and 1949.[50]

As the twentieth century progressed, much of the hosiery industry relocated to cheaper labor and production locations, especially those of the American South. Pennsylvania, which continued to produce half of the country’s hosiery into the 1930s, saw its proportion drop to a quarter of national output by 1954. The Berkshire Mills gave in to the drive for cheaper labor, moving some operations overseas in 1948 and opening a North Carolina plant in 1951. In 1969, Vanity Fair Mills bought the entire company. The following year, Vanity Fair turned the original Berkshire Mills factory building into the first of many Berks County outlet malls.[51]

Even after the dissolution of the Oberlaender Trust in 1953, Gustav Oberlaender’s philanthropic contributions continued for decades after his death. The Gustav Oberlaender Foundation for Education and Charity continued operations in Pennsylvania until 1996, when it handed assets totaling over two million dollars (or $2.78 million in 2010 dollars) to the Berks County Community Foundation. In the twenty-first century, scholarships bearing Oberlaender’s name were available at the Berks branch of Pennsylvania State University, Alvernia University in Reading, and at other institutions. The Landis Valley Museum in Lancaster, underwritten by the Oberlaender Trust, continued to highlight the history and culture of the area’s German communities.[52] Along with the factory buildings constructed by Wyomissing Industries, these programs endured as proof of the impact of Oberlaender and his fellow immigrants, Thun and Janssen.

Conclusion

The story of Gustav Oberlaender demonstrates that the successful entrepreneur does not operate in a vacuum. External factors such as immigrant networks and institutions helped him to begin his proverbial climb up the socioeconomic ladder, as seen in his relationships in New York, Indiana, and Pennsylvania. Meanwhile, social and technological changes created new and different consumer demands for hosiery, to which the Wyomissing partners responded effectively. At the same time, geopolitical realities, especially transatlantic relations in the 1930s, impacted not only Oberlaender’s business but also his image as a philanthropist.

Oberlaender Americanized in key ways, seeing himself as the proverbial self-made millionaire. He even adopted a spirit of philanthropy reminiscent of other industrialists in the United States. But German threads remained, from aphorisms to technical knowledge to ethnic nationalism. It is fitting that a figure who negotiated two nationalities in his own life devoted considerable resources to promote transatlantic understanding.

Notes