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Much has been written about World War II, and yet there are some stories that haven’t been told when it comes to the Nazi war strategy: Adolf Hitler’s war machine would have collapsed if Germany hadn’t financed it with some of the biggest gold heists in history.
According to George M. Taber, author of Chasing Gold: The Incredible Story of How the Nazis Stole Europe’s Bullion, what Hitler looted from several countries would be worth $19 billion today. Taber, a former business editor of Time magazine and founder of the weekly newspaper NJBIZ, recently talked with Knowledge@Wharton about Hitler’s epic theft of sovereign and private gold to finance his imperialistic ambitions.
An edited transcript of the interview appears below.
Knowledge@Wharton: You wrote four books about wine. Now, you’ve written a book about how the Nazis stole Europe’s gold. How did that come about?
George M. Taber: It is a topic that has been a hobby of mine for more years than I would like to admit. Would you believe 50 years?… The more I got into it the more I realized nobody had actually written the kind of book about Nazi gold that I wanted to write, which was to try to put it in the context of how this fit in with the whole Nazi war strategy. I thought, somebody has to do it — why not me?
Knowledge@Wharton: Is it true that it was one of your former editors who put you onto this story first?
Taber: Yes. It was about 50 years ago. I was a young freelance writer-reporter — we called them stringers in those days — for Time. I was in Brussels and he was in Paris, and one day I got a call from him. This was in the mid-1960s, at which time gold was really a big topic of conversation politically because [former French President Charles] de Gaulle was trying to get the world to go back to a gold standard. The United States was fighting it, so there was all the fun of a Franco-American fight.
[The editor] said, “Hey, I picked up this story down here in Paris — I don’t know whether it’s true or not — that during World War II, the Belgians gave their gold to the French for safekeeping. Then the French turned around and gave that gold to the Nazis after they had invaded.” He said, “Boy, that would really make the French look bad. Why don’t you check into it and see if it is true?” I checked into it, and actually, it is true. That is exactly what happened. You have to have a little bit of sympathy for the French because they were under heavy pressure from the Nazis who had occupied their country and who were running everything, so they were not totally free.
“All the gold that has ever been mined in the world would fill up three Olympic-sized swimming pools.”
Knowledge@Wharton: This seems like such a huge story covering the whole of Europe and over such a long period of time. How did you go about doing the research?
Taber: I spent an awful lot of time in national archives. I spent literally weeks. I had four trips to the German archives. I went to the Belgian archives, the French archives and the British archives. In all those places I usually stayed a week going through documents, and some of them were just fantastic. When I saw the various documents in the British archives, I just could not believe what they had.
What I found was these hand-written letters by the British cabinet in which they were making the decisions to ship all their gold. This was in June of 1940, so they thought they were going to be invaded, and they thought they had to get all of their gold across the Atlantic. It ended up that they shipped out 3,000 tons of gold — and not just British gold. They also were holding gold for a lot of independent countries that had sent their gold to Britain in hopes that it would be protected. Then they got fearful that the British were going to be run over by the Nazis as well, so they were going to lose it. They wanted their gold moved with the British gold.
Knowledge@Wharton: One of the things I found so fascinating about the book is that it has these incredible characters. There is one person — Hjalmar Horace Greeley Schacht. Who was he, and what was his role?
Taber: Oh, he was crucial. He was a national hero in Germany because he was the central banker who broke the [hyper] inflation [trend] that had taken place in Germany in the 1920s. It is considered by the experts to be either the No. 1 or the No. 2 worst inflation [`period] in world history. The Reichsmark, as [the German currency] was called at that point, totally collapsed and the inflation was just crazy.
“The German war machine was almost out of money when they invaded Austria. Suddenly they had about 90 tons of new gold, and that allowed them to go on invading other countries.”
What people do not probably appreciate is that when the money that you have in society has no value anymore, the society itself tends to crumble. There is nothing of value anymore. That is exactly what happened in Germany. Literally, at that time the Germans had to take a wheelbarrow full of paper currency — not just one or two pieces — a wheelbarrow full of paper currency to a shop to buy a loaf of bread. The German government was printing new currency so fast that they did not even put anything on the back side of the currency. They only printed on the front side of it because they had to get them running out that fast.
Well, Schacht broke that, so he was very, very important. When he threw in his lot with Hitler and became Hitler’s top finance guy, he also came up with the strategy of how they were going to pay for the war. He called it a policy of autarky. We would call it self-reliance. You were not going to be reliant on any foreign country. You wanted to have everything that you were going to need for the war made in Germany. But there were a few products that the Germans just could not make.
Knowledge@Wharton: What drove the German hunger for gold? Was there any other way that they could have financed World War II?
Taber: There is absolutely no other way because their currency could not be used. Obviously, the United States was not going to be sending them tanks or oil or any kind of product that they needed. The only way that the Germans could get these half-dozen wartime products that were so crucial for their war effort was to pay for them in gold or a currency like the Swiss franc, which the Germans then bought from Switzerland in exchange for gold. Gold throughout history has been a medium of finance that would always be acceptable, because there is so little gold around the world, and it has such a high value. All the gold that has ever been mined in the world would fill up three Olympic-sized swimming pools. Only three. Yet everybody wants that gold. So the price goes up.
Knowledge@Wharton: I believe it was the Austrian central bank that was the first to be raided?
Taber: Yes. It was the very first.
Knowledge@Wharton: What was the impact of that gold on the course of the war?
Taber: Great. The Germans got a lot of gold out of Austria partly because nobody was expecting that kind of thing. They got something like 90 tons of central bank gold, and they got 15 tons of private gold, largely from the Jewish citizens. Vienna had a large Jewish community that held a lot of gold and diamonds, and the Nazis got all of that. The German war machine was almost out of money when they invaded Austria. Suddenly they had about 90 tons of new gold, and that allowed them to go on invading other countries Twitter — Czechoslovakia, Poland, all of those. Some countries, they got the gold. Sometimes, they did not.
“If Hitler had quit, say, in 1936 or 1937, he would probably have gone into history as one of the great leaders, because he brought around the German economy … and he unified the country.”
Knowledge@Wharton: During your research, what were some of the most dramatic episodes that stuck in your mind?
Taber: Probably the Norwegian story. Norway was a neutral [country], but Hitler was running over neutral countries pretty fast, so they were very worried that Norway would be run over. [Early in the war,] the Nazis invaded Denmark and Norway simultaneously. The day of the invasion, just shortly after midnight, the Norwegians had pulled back a lot of their retired officers and retired people, and they were not much of a military power, to say the least. They were a neutral country and thought that the best thing they could do was just hope that nobody would invade. But they had brought back some of the people from retirement.
One of the guys they brought back from retirement was given the charge of protecting the entrance to Oslo, which is the Oslofjord. There was a fortress there that had been built in the 19th century, and in that fortress were some guns made by Krupp, the great German munitions manufacturer — two giant guns. Just past midnight, he looks out into the fjord, and he sees this giant ship coming toward him. Then he realizes it is a whole convoy of ships. He has no idea what the nationality is because it could very easily have been a British ship because the British were also very active in the area, as they were trying to stop the Germans.
He could see this giant ship coming. He did not realize it, but it was a brand-new cruiser. It was on its maiden voyage. It got about a half mile from him and he looked out, and he said to nobody except himself, “Tomorrow I will be a national hero or I will be court-martialed. Fire!” They fired, and dead on they hit the ship, and the ship went down and actually sunk about six hours later. A lot of the soldiers had been able to get off. But it delayed the invasion by just a day, and in that one day of grace, the Norwegians were able to get the cabinet, the gold, and the king up to the northern part of Norway, bit by bit, until they went over to Britain in the end.
Knowledge@Wharton: What surprised you most in writing this book?
Taber: I was surprised by the reluctance of the United States to get more involved. After World War I, the Americans were isolationists and they did not want to get involved in the world situation, feeling we were isolated. We had the ocean between us and Europe, so let the Europeans fight their own thing, even though what the Nazis were doing was really outrageous. It was only after Pearl Harbor that the United States got into World War II. The first invasion of Austria was in 1938, and the United States did not get into the war until 1942. So they had four years where the United States sat on their hands and did not do much. They did some, but not much.
Knowledge@Wharton: Were it not for this major gold robbery, what do you think might have been Hitler’s role in history?
Taber: I do not think it probably would have been much at all, because I think they would have run out of money and his armies could not have accomplished what they did. If Hitler had quit, say, in 1936 or 1937, he would probably have gone into history as one of the great leaders, because he brought around the German economy, which was struggling, and he unified the country.
But he did not care about that. He was a fanatic who only cared about military power, and he did not know how to control himself. He became headstrong, and after those first victories — over France, Belgium, Austria, Poland, all those countries — he was heady [with his military success] and he thought he could do anything. But he made the fatal mistake of invading the Soviet Union. That was the beginning of his downfall.