Andrew Nagorski - Hitlerland

In 1925, Jacob Gould Schurman succeeded Houghton as ambassador. A former New York politician, Schurman had studied in Germany, spoke excellent German and worked hard to maintain the good will that his predecessor had earned. One of his initiatives was to raise money from wealthy Americans for a building fund for Heidelberg University; among the contributors was John D. Rockefeller, who donated $200,000 of the total gift of $500,000. Such activism made Schurman a very popular envoy.

So did his pronouncements praising the German government’s commitment to peace and democracy. Early in his tenure, he argued that “the will to war was dead in Germany” and he later touted Germany’s signing on to the 1928 Kellogg-Briand Pact outlawing war. On a visit to New York that same year, he declared, “The Republic has in general commended itself to the people and grows with such strength and vitality that its permanency may now be taken for granted.”

Schurman wasn’t as blind to the dangers of more turmoil as his public pronouncements suggested. He noted during his first year in Berlin that American financial institutions were aggressively pushing their highinterest loans, disregarding the risks involved. His embassy reported that the “itch to pour unproductive millions into German municipal coffers is rapidly becoming pathological.”

American correspondents like Mowrer also began to question what was happening. Economist David Friday, who had been one of Mowrer’s instructors at the University of Michigan, came to Berlin representing an investment firm eager to pump funds into Germany. Puffing on a cigar after a dinner with the Mowrers, he explained his mission: “You see we consider these people a sound proposition: hard-working, solid… we’re going to put them on their feet again.”

“At nine per cent?” asked Mowrer.

“Well, of course, we are no philanthropists,” Friday replied.

As Lilian Mowrer pointed out, the influx of what appeared to be easy money from the United States and other countries led to “an orgy of spending.” Traveling frequently around the country for her Town and Country pieces, she mentioned one example: “the stunning new railway cars and streamlined monsters on the Reichsbahn track.” She also realized that “the entire rolling stock of the country had just been equipped with the new Kunze-Knorr air brakes, a little luxury that had cost close to one hundred million dollars.” Britain, she added, had considered equipping its railroads with those new brakes, but had concluded it couldn’t afford to.

Germany was also using loans to make reparation payments, and Schurman openly sympathized with German complaints that the financial burden was unsustainable. Even before the Wall Street crash, there were plenty of ominous signs of the shakiness of the German economy. In March 1929, Schurman received a warning from the chairman of the Reichstag Budget Committee that the country’s finances were in the worst shape since the near meltdown in 1923.

Soon the Dawes Plan was replaced by the Young Plan, named after American banker Owen D. Young, the chairman of another group of experts. They produced a plan in 1929 to further reduce reparation payments but stretch them out all the way until 1988. Ferdinand Eberstadt, the most knowledgeable of the American experts about Germany’s finances, bluntly told Young right at the beginning of their deliberations with the French and others: “Hey, this thing’s a fake—it will bust up because they are playing politics and have no concern for economics.” German officials complained the payments were still too high, and Hitler and other opposition figures denounced the whole scheme.

The Wall Street crash of October 1929 changed everything. Although the German government formally approved the Young Plan in March 1930, allowing it to receive about $300 million in new American loans, the plan was effectively stillborn. Faced with the sudden drying up of foreign loans and the domestic credit market followed by mounting unemployment, the Socialist government collapsed that same month. A new minority coalition led by the Center Party’s Heinrich Brüning failed to win support for its economic program. Frustrated by the gridlock in the Reichstag, he called for new elections in September.

The stage was set for the return of the agitator from Munich.

Like so many Germans, Bella Fromm discovered that her life was turned upside down by World War I and its aftermath. Born into a well-to-do Bavarian Jewish family in 1890, she had worked for the Red Cross during the war. Her parents died early, leaving her with what looked like a healthy inheritance once the fighting stopped—certainly enough for her to live on after a brief unhappy marriage and continue doing volunteer social work. But then the hyperinflation of the early 1920s wiped out that cushion and she had to look for a paid job. “I’m going to have to start a new life,” she wrote in her diary on October 1, 1928. From age ten, she had kept a diary and now she decided to write for others, not just herself. She became a journalist for the Ullstein publishing house, covering the social and diplomatic scene in Berlin.

The cub reporter quickly proposed a novel approach to her job. “Let’s have society reports in the American manner,” she told her editor at the Vossische Zeitung , a Berlin-based liberal newspaper with two issues a day. “Lively, with plenty of pictures.” Her editor agreed to give this a try, and soon she wasn’t only reporting in what she dubbed the American manner but mingling frequently with Americans as well, scrupulously noting her encounters in her private diary that she continued to keep.

In her diary entry of July 16, 1929, she described her experience at a Davis Cup match between Germany and Britain in Berlin’s Grunewald district, famous for its lush forest. William “Big Bill” Tilden, the American tennis champion, was there to watch Daniel Prenn, Germany’s top player, who was Jewish. He was playing the English star Bunny Austin. When Prenn won, Fromm noted, “‘Big Bill’ beamed, for Danny had gained his victory with a racket Tilden had brought him as a present from America.”

But Fromm heard a very different reaction from Count Friedrich Werner von der Schulenburg, who was a member of the Tennis Guild and would later serve as Germany’s last ambassador to Moscow before Hitler’s armies invaded the Soviet Union. “Of course, always those Jews!” he remarked.

“What do you mean?” Fromm asked angrily.

“The Jew would win of course,” he responded. But as Fromm recorded, at least “he had the grace to blush.”

Fromm had the last word. “He won for Germany. Would you have preferred to have the Englishman win?”

Perhaps precisely because of such contrasts between the Americans she met and her own countrymen, Fromm’s diary entries about Americans in Germany were almost always positive. On February 2, 1930, she went to the train station to observe the arrival of the new American ambassador to Germany, former Kentucky Senator Frederic M. Sackett. In her diary, Fromm wrote that he was “a gentle-looking man with, obviously, very good background.” As for his wife, she was “an attractive woman of great distinction.”

In a later entry that year, she marveled at how the Sacketts were showing what entertaining American-style was all about. “Even the international diplomats are stunned,” she wrote. “The Sacketts serve lobster at tea, an unheard-of luxury in Berlin.”

But Fromm also observed that the new ambassador was acutely aware of the economic crisis that Germany and other countries now faced following the Wall Street crash. She sat next to him at a dinner and opera recital hosted by the Czech legation, giving her the first opportunity to speak with him. “I like Berlin. It is inspiring,” he told her. “We are anxious in America to help Europe get out of the present crisis. We’d like to settle national differences at the green table instead of on the battlefield.”