The Star in the IBM crown

Jewel in the IBM Crown I have begun and will in the weeks to come read and think about the situation in Germany between 1919 and 1933. Germany was a vast and diverse country with different parts such that Adolf Hitler’s party had very little support in many parts of Germany. And socialism was strong in some parts- while writers I have read speak of a spring time in Germany of great intellectual freedom prior to the advent of the Nazi Party gaining a hold. American Professor Robert Brady writing in ‘Spirit and structure of German Fascism’ Victor Gollancz London 1937 says ‘German scholars and men of letters began to turn out what seemed to be a tidal wave of books brochures and periodicals on every conceivable subject. For a period of time German new-book listings were as great as those of France England and the United States combined’ p18. But in particular I am fascinated with what he says next; ‘On the surface there seemed no reason why the world might not return to peace…why the Indian Summer of the German people might not ripen into a century long harvest…yet with the exception of USA the period from 1924 to 1929 was no blossoming time for either the people of Germany, the new nations of Europe or any of the allies (England France, Russia) instead of recovery in Germany, there was collapse. Instead of prosperity there was a world wide depression. Instead of disarmament there were mounting military budgets which dwarfed those with which the belligerent nations began the war. Instead of internal stability there was mounting social unrest’ p25 – What I want to think about more is these critical 1920s years and how business and investment and political decisions being made at that time in New York were influencing what happened in Germany. ‘Watson’s connections to Germany set the stage for a technological and economic alliance with the Third Reich…. Watson in 1933 possessed an extraordinary investment in Germany. It began in the early twenties during the height of Germany’s tornadic post war inflation… Watson travelled to Germany and ruthlessly offered Heidinger two options : bankruptcy or handling substantial ownership of Dehomag over to Watson…. Watson abruptly upped his demand to 90 percent .. Dehomag continued as an IBM subsidiary. Heidinger was allowed to retain approximately 10 percent of the stock… but could only own them as long as he worked for Dehomag.. For a decade after IBM acquired Dehomag, Watson tightly managed the German subsidiaries operations, setting it’s sales quotas and at the same time benefiting from the technical improvements to the Hollerith system devised by German engineers…. the German subsidiary’s revenues outshone them all. Many European countries were slow to adopt Hollerith technology. German however, was willing to accept punch card systems. Indeed, of some of the seventy subsidiaries and foreign branches world wide more than half of IBM’s overseas income came from Dehomag alone. By 1933 Dehomag had turned in a spectacular financial performance, 237 percent of its quota, and Willy Heidinger was due to be one of the stars at the forthcoming Hundred Percent Club convention in New York. P55-57 IBM and the Holocaust Edwin Black Time Warner New York 2002.