Chapter 54: Hearing Is Not Truth
Not only Hamburg, but Munich, the Ruhr, and Berlin as well, all the major industrial cities were undergoing inspection.
In truth, Jörg's deception was not especially clever. A few hurried weeks of preparation could not turn every participant into a master actor. But he possessed one logical weapon no one on the inspection teams could easily overcome.
The Americans and their partners had not come to Germany out of charity. They had come to lend money.
And every extra dollar lent meant more interest earned.
Because of that, even when several inspection teams privately harbored doubts about Germany's inflated industrial output, they still lacked the most important thing needed to overturn the numbers: motive. Even a police investigation into murder required motive before it could close around a suspect. Without one, suspicion remained suspicion.
So in the end, they could only record the questionable data as fact and submit it, one report after another, to the Economic Reorganization Committee based in Berlin.
Inside the Foreign Ministry building on Wilhelmstrasse, the mood could not have been more different from the bustle outside.
At the very center of the storm, Jörg, the man who had set everything in motion, looked almost absurdly relaxed. He sat with a cup of coffee in hand and calmly turned the last page of a military treatise on large scale operations. His stern profile showed no hint of tension, only the deep stillness of a chess player waiting for the board to resolve itself.
The telephone rang.
Its sharp sound echoed through the office, cutting through the rich aroma of coffee.
Jörg picked up the receiver. Cardolan's voice came through at once, familiar and steady.
"Master, they've left."
Jörg's eyes shifted toward the window, but his tone remained even.
"I understand."
He paused briefly before continuing.
"Temporarily halt weapons development. Back up all radar data for me. It's time for the company to step onto a bigger stage."
He hung up.
Almost at the same moment, the telephone in the Economic Reorganization Committee office two floors below began ringing as well.
Unlike Jörg's composure above, Dawes was buried in work.
Statistical documents were spread across a wooden table nearly three meters long. Six financial analysts brought over from Wall Street were bent over the figures, converting mountains of paper into hard numbers, and hard numbers into a mountain of money.
Dawes stood over them with a cigarette hanging from his lips. His eyes were bloodshot from exhaustion. He had thrown himself into this mission with a dedication that bordered on obsession.
To countless men of ability, Director of the United States Bureau of the Budget was already a glittering summit, a tower beyond the reach of ordinary ambition. But Dawes knew better. His true target was not an office, not a department, not even a cabinet seat.
It was the White House in Washington.
This success in Germany was supposed to be his stepping stone, the achievement that would strengthen his standing within the Republican Party and help him contend with Coolidge for the presidential nomination.
He lifted the receiver.
"Well?"
The voice on the other end came quickly.
"Have you found anything? Any obstacles during the inspections?"
For a moment, only the rustle of papers could be heard. Then his secretary answered.
"There were some protective obstructions at first, but afterward they provided complete data. There may be some minor statistical distortions because of wartime losses, but on the whole, the numbers match the industrial capacity we observed."
"Mr. Dawes, I think we can begin contacting the White House and the financiers on Wall Street."
Dawes nodded to himself.
"I see."
He set down the receiver.
One of the analysts, a thin man with spectacles sliding down his nose, finally straightened up and pushed a finished report toward him.
"Mr. Dawes, after discussion, we have arrived at a more moderate figure."
He tapped the paper.
"If Germany is to restore its economy as quickly as possible, the first general loan should be no less than five hundred million dollars. After that, one to two hundred million in annual low interest loans for the next two years would be required to sustain the entry window for major capital."
Dawes read the number without surprise. It fit within the range he had mentally prepared for.
But it most certainly did not fit within the range prepared by the White House.
The original plan had been much more conservative. A total reserve of two hundred million, split cleanly between one hundred million in government allocation and one hundred million from the Morgan consortium. Any additional shortfall, if there was one, would have to be covered in part by Britain and France.
What lay before him now was something else entirely.
It was not a shortfall. It was a massive expansion.
He looked up.
"Where is Jack Morgan now?"
One of Morgan's secretaries answered at once.
"He is currently visiting Mr. Lohan, the German banking representative, at his villa outside the city. Shall I take you there, sir?"
"Take me there."
…
At the same time, in the heart of Berlin's commercial district, Lohan Bank stood like a monument to triumph.
As one of the largest private banks in Berlin, and indeed in all of Germany, the building dominated the street. Across from it stood the true heart of the German economy, the German State Bank, the institution that still formally controlled currency issuance.
Yet from the outside, Lohan Bank seemed to rise a floor higher than its rival.
That was no accident.
Lohan had ordered it that way.
To him, architecture was not merely stone and steel. It was declaration. The extra height was his statement to the city, to the government, and to the nation itself. A silent proclamation that the old Germany, with its pretensions of sovereignty, was already being devoured from within.
At the top of the building, in the office beneath the spire, luxury reigned.
The carpets were woven with threads of gold. Upon them were worked the intertwined crests of the Lohan family and the Kuhn, Loeb & Co. financial empire in the United States, along with something invisible but no less real: the blood and tears squeezed from the German people.
As the leading representative of Jewish capital in Germany, Lohan's tie to American Jewish finance had never weakened. If anything, it had grown tighter with time. The mechanism was old, simple, and effective: intermarriage.
The Warburgs and Kuhn, Loeb formed the bond between German and American financial power, and that bond was far sturdier than any treaty.
Lohan uncorked a bottle of red wine and poured it with practiced ease.
"How is Paul Warburg's health?" he asked, his voice smooth.
Across from him, Jack Morgan took the offered glass, swirled the wine, and inhaled its fragrance.
"I was in Washington before coming here," he replied. "Warburg is in good health. He also asked me to pass along his regards."
Lohan nodded thoughtfully, then turned his gaze through the tall French windows toward the opposite building, the German State Bank. His eyes lingered there with a greed so naked it barely needed disguising.
"And how much investment have you prepared for this visit?"
Jack set the glass down and answered plainly.
"Morgan Bank is prepared to provide one hundred million dollars. The American government has another hundred million in reserve. As for Britain and France, I can't give you an exact figure, but it won't exceed another hundred million."
He lifted one shoulder.
"Of course, that is merely the opening move. The real bulk will come later, once private capital begins entering the country in earnest."
At those words, Lohan's expression shifted almost imperceptibly. His appetite sharpened.
"Are there any conditions attached where the banks are concerned?"
Jack seemed to have anticipated the question. He rose from his seat and walked toward the window, staring at the German State Bank as though he were already evaluating it for purchase.
"Yes," he said at length. "There is one."
He turned halfway back.
"We intend to restructure the German State Bank. Its character will be changed from state institution to private joint stock structure. In other words, control over currency issuance will no longer remain entirely in state hands."
Lohan's fingers tightened around the stem of his glass.
Jack noticed, and continued before the other man could speak.
"Do not misunderstand. The majority stake, under normal circumstances, will still remain in German hands. We would merely establish supervisory authority over the bank's operation. Think of it as a small compensation in exchange for Germany's cooperation."
But Lohan had already heard only the part that mattered.
His eyes gleamed with raw avarice.
"What if circumstances are not normal?"
Jack raised an eyebrow.
Lohan leaned forward.
"As you said, the funding is yours. But what if two hundred million proves insufficient? What if there are liquidity problems? What if the additional funds are difficult to raise?"
His voice had dropped almost to a whisper now.
"In that case… could the Germans' bank become ours?"
.....
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