Trust company keeps the Netherlands going
It is Sunday 28 February 1915. It is the 36th week after the shooting at Sarajevo.
Soissons and Reims cathedral are bombed by the Germans.
At Perthes in the Champagne district the battle goes back and forth.
The French attack German positions on the Hartmannsweilerkopf in the Vosges.
In the Dardanelles British ships bombard the Turkish fortresses on the coast and further to the south the Ottoman coastal town of Smyrna also comes under fire.
Winston Churchill optimistically starts giving an outline of the conditions for an armistice after capitulation of the Turks.
At the Neman river the Germans have to flee from the Russians, who also put great pressure on the Austrians in the Carpathians.
In Greece King Constantine dismisses his prime minister Eleftherios Venizelos, because the latter is willing to help the British and the French in their Dardanelles Campaign.
The British Admiralty dictates that crew members of German submarines who were taken prisoner can be denied ‘honourable treatment’.
And as a reaction to the blockade of Great Britain by German U-boats, the British government will even more tightly control the merchant navy, which further increases the importance of the Netherlands Oversea Trust, a creation of entrepreneur Anton Kröller.
While the world around them was set alight, the Dutch also had to keep their fires burning, preferably in such a way that they were not drawn into either of the war camps. For this purpose they needed tricks and the cleverest trick was the Netherlands Oversea Trust. Its abbreviation is NOT. Freely adapted from Shakespeare, for the Dutch economy in the Great War it was a matter of ‘not to be or to be not’.
In fact the bottom line of it was to import as much as possible without getting into trouble with the English. It would mean mayhem, if Dutch companies started exporting their import goods again to Germany. The Dutch government of course could forbid this export, but then this would be a hostile act in the eyes of the Germans. So the Netherlands and their economic interests were caught between the warring parties.
‘Holland cannot make love’ is the title of a song. ‘Holland cannot help but preserve its decency – It cannot make love in these days’ (literal translation of the original Dutch words). However, there was a lovers’ trick. Ships delivered their merchandise to a private enterprise, which was of course the NOT. And the NOT could warrant that a warring country, Germany in particular, would not be the final destination of the goods. In 1916 the English periodical The Economist called the NOT ‘a stroke of genius’.
In a short period of time the NOT grew from an organisation with a few staff members into a bureaucracy in fifteen buildings scattered over The Hague. They were not allowed to make a profit. Shipping companies that were committed to the NOT promised only to sell their goods for domestic use. Their ships carried the striped black-and-white NOT cone.
It was the Rotterdam industrialist Anton Kröller who set up the NOT at the end of 1914, though rumour has it that a British trade commisioner had whispered the idea into the ears of the Dutch. Time over again the British had stopped Dutch ships in the first months of the war. This was not only an irritating but also a costly affair.
The British were looking for contraband, goods which were put on a black list. Initially this only meant war stuff such as weapons and ammunition. International law allowed control of this. But the British started to stretch the definition of contraband further and further. Soon also food was considered contraband. Not only the Netherlands, but also the United States complained about these far-reaching trade restrictions. However, President Woodrow Wilson was not very strict to the British with their minefields that marked the narrow shipping channel for the merchant ships which had to be inspected. He was much stricter to the Germans who turned the economy into a war with their U-boats.
The Netherlands owed peace to its commercial potential. Old Von Schlieffen had drawn an outline of a swing of his troops both through Belgium and the Netherlands in his plan of the attack on France. But in later years the Germans had started to realize the importance of the neutrality of the Netherlands as a ‘Luftrohr’ (windpipe) for their own economy. At the same time this was what the British feared. How could they turn Germany into a terminal patient as long as it was drip-fed by a neutral country? The Germans could hardly do without iron ore from Sweden, nickel and copper from Norway and agricultural imports from the Netherlands but also from Denmark. During the war Germany’s trade deficit was an average 5.6 per cent of the net national income.
In the first years of the war the Dutch economy survived only just after pure panic had broken out. After the attack at Sarajevo shares dropped considerably and exactly a month later, on 28 July 1914, it even proved necessary to close the stock exchange. During the financial crisis that broke out people started stockpiling and only spent paper money. At the banks long queues of customers were forming who wanted to cash in their banknotes.
On 3 August, the day before the German invasion of Belgium, the Dutch government made a firm decision. Emergency money had to regain consumer trust. And even though counterfeiters regularly undermined the system, the so-called zilverbons (silver coupons) continued to prove their value throughout the war. In 1918 about 71.6 million guilders worth of silver coupons were in circulation.
The firm approach of the threatening war crisis concealed a golden duo. Willem Treub, a radical liberal, proved to be a strong Minister of Finance for the Netherlands. Historian Paul Moeyes describes him as ‘a brilliant organizer and instigator’. Treub’s trademark was the blue-and-white dot printed bowtie, the so-called ‘Treub tie’. Perhaps less flamboyant but just as decisive was the strong man from the business world, president C.J.K. van Aalst of the Netherlands Trading Society. Van Aalst was made chairman of the board of directors of the NOT.
Treub and Van Aalst were literally sitting next to Queen Wilhelmina when she launched the National Support Committee. Poverty was also lurking in the haven of calm which was called the Netherlands. Especially families of mobilized soldiers needed support. Many had to beg the Support Committee for life. A writer of occasional verse made a Dutch version of the Tipperary march: ‘It’s a long way to the committee…’.
Nevertheless the Netherlands managed to survive the war relatively unscathed. The year 1916 economically even proved to be a peak year. After that it became a lot less, which was mainly the result of the resumption of unrestricted submarine warfare by the Germans. In 1917 and 1918 only half of the number of seaships of 1916 entered the Dutch ports, despite the efforts of the NOT.
Frankly speaking the NOT had to manoeuvre through a minefield. The British were quite annoyed by the export of Dutch pigs to Germany. The NOT had promised not to channel any products to Germany that had been compiled of imported goods. The Dutch pigs had been fattened with imported maize. Therefore the British demanded the NOT to forbid the exportation of the so-called ‘maize on legs’.
The British thought they could keep Dutch trade under control with the help of the NOT, but in the end the Trust did not prove to be very compliant. And if an export embargo was announced at all, hordes of smugglers showed up who were willing to sell Dutch merchandise on the other side of the border. All in all the British saw enough reason to tighten the screws of the Dutch freight trade some more. Dutch ships were no longer allowed to bunker in Port Said, before the Suez Canal, from January 1916 onwards. As of now the navigation route to the Dutch East Indies went via the Cape of Good Hope, which was a detour of over 4,000 miles.
In the eyes of the British also the fish appeared questionable. In June 1916 the Royal Navy was ordered to phase out the entire Dutch fishing fleet. The indignation about this in the Netherlands was so big that the British in their turn restrained themselves again. Yet a certain degree of friction remained. And if it weren’t the British that seized a merchant ship for examination, a Dutch vessel would always run the risk of encountering a German U-boat. SS Katwijk for example was hit by a German torpedo on 14 April 1915. Its cargo was indeed maize.
The Netherlands, and the NOT in particular, were bouncing back and forth throughout the war. In the NOT a man like Anton Kröller appeared on various occasions to be especially open to the German side of the story. Whoever leafs through the family album will not be surprised. Kröller’s grandfather settled in Rotterdam as a German immigrant. Kröller himself started as a trainee in Düsseldorf at a trading firm in iron ore, called Wm. H.Müller & Co. Not only did he gain the trust of the management, but he also seduced Helene Müller, the daughter of the founder.
Anton Kröller expanded the firm into an empire, while Helene Kröller-Müller compiled an imposing art collection. Millions were withdrawn from the firm’s capital to satisfy the aesthetic self-indulgence of Helene. In the thirties all her works of art were to find a home in a museum on the Hoge Veluwe, though as a result of financial problems this place never reached the size Helene had dreamed of.
The famous architect Hendrik Petrus Berlage spent the entire Great War building an imposing hunting lodge for the couple on their estate on the Hoge Veluwe. The First World War certainly paid off to Anton Kröller and his wife. Müller & Co acquired the monopoly on cereal and ore. In order to nuance his reputation of Deutschfreundlichkeit (sympathy for Germany), Kröller bought the indigent daily newspaper Het Vaderland. During the war he also became advisor for a Rotterdam Bank and he was involved with the foundation of the Koninklijke Nederlandsche Hoogovens en Staalfabrieken (Royal Dutch Furnace and Steel Works). In the first year after the war Kröller interfered in the launch of KLM (Royal Dutch Airlines).
But in the thirties he loses grip of his own empire, Müller & Co. When Kröller is already in his seventies, the shareholders force him to resign. In 1941 he dies on the Hoge Veluwe at the age of 79. Two years earlier he had responded to the request of the Foreign Ministry to join the Swedish industrialist Birger Dahlerus in encouraging the German neighbours to peace. Without any chance of success of course.
In an official biography he is given a send-off as follows: ‘Contemporaries praised his sharp financial understanding, which unfortunately at Müller & Co had to give way to passion of collecting and lust for power, with disastrous consequences. The splendour of the fantastic heritage of the couple is greatly affected by the knowledge that this was achieved by inappropriate business management.’
Anton Kröller has also been called Oweeër, in Dutch short for war usurer. ‘No doubt Kröller has had a ‘good’ war’, Paul Moeyes writes, with the word ‘good’ in inverted commas. ‘As a cereal buyer he is said to have pocketed millions in commissions and freight costs. Already during the war it had been pointed out to Minister Treub that Kröller charged the government a personal commission of fifteen per cent for the cereal he bought. Kröller was also supposed to have mediated, traded and spied for the Germans.’
Dutch top industrialist Anton Kröller took advantage of the war, while his wife feasted her eyes on her Van Goghs. In the meantime a whole generation of young men perished in the trenches. According to the biography Eva Rovers wrote about Helene Kröller-Müller’s life, this caricature is of course not entirely fair. During the war she was a nurse for a while and as such she looked after the wounded in a lazaret in Liège. After the war she offered two of her houses on the Veluwe for the recovery of German children.
Next week: H.H. Asquith
Tom Tacken (translation Peter Veltman)