The views expressed are the author's own and not necessarily those of the Brennan Center for Justice.
Considering the outcome of this year’s presidential primaries, where the best-financed candidates were defeated, I’ve been asked repeatedly whether corporate money in politics really matters. And I’ll grant, corporate money so far mostly gone to losing candidates. But history may give us some greater perspective on how corporate money in politics can prove decisive.
It’s a largely forgotten piece of history, but in 1932 the German Nazi Party was facing financial ruin. How did the Nazis move from being broke to being in control of the German government just a year later? The Nazi Party was bailed out by German industrialists in early 1933.
The industrialists who led the way were two huge German firms, I.G. Farben and Krupp. Leaders of both of companies were among the few civilians who were later charged with war crimes at the Nuremberg Tribunals after World War II. These trials placed the story of their financial and moral support of the Nazis into the historical record. Krupp was a huge arms manufacturer. I.G. Farben was a vast chemical company which made everything from Bayer aspirin to Zyklon B, the poison used in the gas chambers.
According to The Arms of Krupp, the Nazi Party was essentially bankrupt in late 1932. Joseph Goebbels, who would later become the Minister of Propaganda, complained, “[w]e are all very discouraged, particularly in the face of the present danger that the entire party may collapse….The financial situation of the Berlin organization is hopeless. Nothing but debts and obligations.”
Regardless of the party’s financial problems, Hitler was named Chancellor in late January 1933. He called for elections in early March. With less than two weeks left before the vote, Herman Goering sent telegrams to Germany’s 25 leading industrialists, inviting them to a secret meeting in Berlin on February 20, 1933. Attending the gathering were four I.G. Farben directors and Krupp chief Gustav Krupp. Hitler addressed the group, saying “private enterprise cannot be maintained in a democracy.” He also told the men that he would eliminate trade unions and communists. Hitler asked for their financial support and to back his vision for Germany.
According to Robert Jackson, the former Supreme Court Justice and chief U.S. prosecutor at Nuremberg, “[T]he industrialists…became so enthusiastic that they set about to raise three million Reichsmarks [worth about $30 million today] to strengthen and confirm the Nazi Party in power.”
Gustav Krupp was the first executive to speak at the Berlin meeting, and pledged one million marks. As the United Nations summarized in a 1949 report, Krupp was a key financier for the Nazi Party, including through his corporation:
It was clear from the evidence that Gustav Krupp embraced Nazism shortly prior to the seizure of power by the Nazi Party and continued his allegiance thereafter. He played an important part in bringing to Hitler's support other leading industrialists and through the medium of the Krupp firm… from time to time made large scale contributions to the [Nazi] Party Treasury.
Hitler awarded Krupp the title of Fuhrer of Industry later in 1933.
Krupp acted in concert with other businessmen, including the directors of I.G. Farben, then Europe’s largest corporation. I.G. Farben’s full name was Interessen Gemeinschaft Farbenindustrie Aktiengesellschaft which translates to “Community of Interest of the Dyestuffs Industry, Incorporated” or as one of the Nuremburg prosecutors, Josiah DuBois Jr. in his book, The Devil's Chemists, put it, the name was “like the cross between a service club and Easter eggs.” But what I.G. Farben did with the Nazis was no laughing matter, including using slave labor at a specially-constructed plant at Auschwitz called Monowitz.
In the opening of the tribunal against the directors of I.G. Farben, prosecutor U.S. Gen. Telford Taylor stated: “The indictment accuses these men of major responsibility for visiting upon mankind the most searing and catastrophic war in human history. It accuses them of wholesale enslavement, plunder, and murder.”
At the February meeting, the I.G. Farben executives gave the Nazis 400,000 marks, and a total of 4.5 million marks by the end of 1933, according to The Crime and Punishment of I.G. Farben. This infusion of corporate cash saved the Nazi Party from financial disaster. The rest, as they say, is history — tragic, tragic history.
As the book Hell’s Cartel explains, the history of the German industrialists’ support of Hitler shows “what can go wrong when political objectives and the pursuit of profit become dangerously entwined.” One can only surmise what might have happened if the businessmen had simply said “no” to Hitler that night.