Following his return from New York two weeks ago German Chancellor Gerhard Schröder and 12 representatives of prominent German businesses and banks announced the creation of a foundation for the compensation of Nazi-time forced labourers. The "joint declaration" has been supported up to now by Allianz, BASF, Bayer, BMW, DaimlerChrysler, Deutsche Bank, Degussa-Hüls, Dresdner Bank, Friedrich-Krupp, Krupp-Hoesch, Hoechst, Siemens and Volkswagen. More companies are sure to follow.

Schröder stressed with remarkable openness the foundation's central purpose when he explained on February 16 that the companies and the German government now expect legal security, meaning that no German enterprise would have to fear any further collective action. At stake was "to knock the bottom out of campaigns aimed against the reputation of our country and our businesses, thus enabling the German economy to pursue its work unhindered". This is why in future all demands should be directed to the new fund and not, however, to the companies that profited from the forced labour.

For five decades the heads of business had relied on a "biological solution", i.e., they had speculated on the last of the plaintiffs dying one day soon, thereby rendering all demands invalid. However, the decision half a century later to finally compensate the last living forced labourers for their suffering was not taken on a voluntary basis, nor was it in response to moral principles.

It is simply a prerequisite for leading German company representatives to be able to establish business partners and customers on the global market, especially in the US. The only way to avoid a possible international boycott was by taking responsibility in a reasonably plausible way before a world public for the exploitation of millions during the period of fascist tyranny.

This becomes particularly clear in the case of the Deutsche Bank and its chairman Rolf-Ernst Breuer. Breuer personally participated in the goodwill tour to New York organised by Schröder and his head of the chancellery, Bodo Hombach. The Deutsche Bank had announced in November its purchase of the American Bankers Trust for $17.1 billion. Following the merger of Daimler with the US car giant Chrysler, which had gone off smoothly, the Jewish World Congress intervened in the case of the Deutsche Bank's merger. As a precondition for the merger, they demanded compensation for the atrocities committed during the Third Reich, through which the bank had gained massive profits.

In the United States there are already several collective suits pending against the Deutsche Bank and the Dresdner Bank. These concern above all the so-called "arianisation"--the dispossession of Jewish citizens and their businesses which took place, not just in Germany, but in all occupied countries such as Belgium, Poland, Czechoslovakia, Hungary and Austria.

The Süddeutsche Zeitung explains this phenomenon in a February 6 article entitled "The sudden power of history": "The reason for the suits being treated as an international priority is that the politicians and the business world neglected to find a solution for the compensation of forced labourers or consciously played for time.... Globalisation played its part: Because, in the meantime, all German companies have subsidiaries in the important North American market they can be sued there according to US law."

There are simply too many compromising facts involving detailed evidence which have come to light over the last months: The Dresdner Bank traded by the ton with stolen gold from the concentration camps and ghettos which came from jewellery, gold valuables or gold teeth; IG Farben and Degussa were involved in the production of the deadly gas cyclone B which was used in the gas chambers; Allianz and other insurance companies refused to pay out policies taken out by Jews; the Siemens company built one of the world's biggest electrical companies during the "Reich of a Thousand Years" and made huge profits from the Nazi-program "Destruction through Work".

In particular the carefully cultivated image of the Deutsche Bank of recent has been very severely affected. Earlier glossy brochures about the bank's history always said that especially in the "period after 1933" the bank exercised restraint, successfully resisted the Nazis' attempt to undermine the executive, and despite "a few new acquisitions after 1938" made "no concessions" to national socialism. The executive's spokesman Hermann Josef Abs, responsible for all import-export business, became chancellor Adenauer's financial advisor after the Second World War and éminence grise of German business. The town of Frankfurt am Main appointed him honorary mayor.

However following the first conference between the German business world and historians in 1997, then a year later the presentation of a report by a Swiss historians' commission, and finally at the end of 1998 the foundation of a "Society for European Business History" in Paris, the Deutsche Bank took the bull by the horns. It preferred to unravel its history anew rather than leave it to others.

Historians of the establishment's own archives have now presented documents which prove the Deutsche Bank contributed towards the financing of Auschwitz with the full knowledge of its executive. The Kattowitz subsidiary of the Deutsche Bank gave a loan for the building of the Buna plant of IG Farben and sites of the Waffen-SS in Auschwitz.

On February 4, 1999 in Frankfurt the head of the Deutsche Bank's Historical Institute, Manfred Pohl, explained in detail the lucrative relations which existed at that time: executive member Hermann J. Abs was also a member of the board of directors of IG Farben, the parent company of the Buna plant in Auschwitz. This facility, built in 1941 in Auschwitz-Monowitz, produced synthetic rubber and exploited forced labourers who worked for virtually nothing. The plant kept a current account at the local subsidiary of the Deutsche Bank, and by the spring of 1943 turnover ran up to 5 million marks a month.

Furthermore there were relations via bank accounts and loans to the Topf company, which built the crematoriums in Auschwitz. In addition the bank ran accounts for the Gestapo, which did not have names but did cite references. Following the plundering of Jewish property by the Gestapo proceeds from auctions were managed on these accounts.

The entanglement of the Deutsche Bank in the building of Auschwitz is commented upon by the Süddeutsche Zeitung: "The files giving information on this have existed since the time they were begun. But they have only now been found because someone bothered to look for them."

The facts were available 50 years ago. In June 1947 a special commission--the OMGUS (Office of Military Government for Germany, US)--presented the report of its inquiry into the Deutsche Bank, the contents of which still give its managers headaches today.

The OMGUS inquiry group, the "Deutsche Bank Team", was attached to the finance ministry headed by Henry Morgenthau and comprised Jewish German emigrants, American experts in public finance and historians. A few months after the fascist defeat in 1945 it was possible for this group to conduct research relatively freely in Germany while the Nuremberg Trials were being prepared. Its most prominent patron, the American finance minister Morgenthau, advocated the plan of demilitarising Germany, dismantling the iron, coal and steel industries' plants and breaking up the big banks and industrial companies.

The OMGUS report then faded into oblivion in 1947 after the Truman administration in the US had replaced Roosevelt and the rebuilding of Germany became an important factor in the Cold War.

The report of the Deutsche Bank Team "proved that the leaders of this bank giant had the closest political connections to the Third Reich's centre of power" and leading members of the executive of the Deutsche Bank such as Emil G. von Stauß, Philipp Reemtsma, Carl Friedrich von Siemens and Albert Pietsch had already been financing Hitler long before his take-over. The report brings to light the mechanism through which the bank controlled the financial network in the Reich's territory and also exercised control over industry. It showed the role played by the bank in rearmament and war preparations and how it advanced the "arianisation of the business world" from which it made enormous profits. The report proved how the bank's import-export business developed and how closely its world-wide operations were co-ordinated with the annexation programs of the "Third Reich".

A special chapter dealt with the exploitation of forced labourers, concentration camp prisoners and prisoners of war through the joint stock companies which the Deutsche Bank controlled, amongst them the Mannesmann-Röhrenwerke, the Bayrische Motoren-Werke (BMW), Daimler-Benz or Siemens.

The essence of the report was summarised in the following recommendations that were, however, no longer of official interest after 1947:

"It is recommended that:

1.

The Deutsche Bank be wound up;

2. 3.

The employees of the Deutsche Bank responsible be charged and tried as criminals of war before a court;

4. 5.

The leading employees of the Deutsche Bank be excluded from important or responsible posts in Germany's economical and political life" (OMGUS investigation against the Deutsche Bank, Nördlingen, 1985).

6.

No wonder that current heads of the bank and the industrial magnates are desperately seeking to put a cap on their history as quickly as possible.

Whether this compensation for the forced labourers still alive is the best solution is an open question. Particularly in Eastern Europe, hundreds of thousands of former work slaves of the Nazis are still alive. In the Baltic region, in Poland, Russia, the Czech Republic, Hungary and the Ukraine there are at least a million people who until today have only received a pittance (approximately 500 marks per person, according to the compensation law of 1993) or no compensation at all. From the very beginning they were excluded from the talks over the planned foundation.

The compensation fund now planned does include for the first time a declaration of intent declaring that "nationality and religion" would play no role in the way money is distributed. However, for the victims there are no guarantees of legal security against future claims such as that demanded by the leaders of the banks and industry.