The Downfall of Money: Germany’s Hyperinflation and the Destruction of the Middle Class (29 page)

On the British side, Horne largely agreed:

The difficulty was that they were in a vicious circle. Germany said she could not stop the emission of paper money and repay her obligations unless she was able to raise a foreign loan, and she could not raise a foreign loan until she could pay her obligations. This was the vicious circle they were in.
16

So both the Americans and the British were convinced that Germany must be given some leeway. Poincaré, on the other hand, remained of the opinion that the Germans were deliberately using inflation to avoid their commitments under the Treaty of Versailles. There was truth in this. Stinnes had told the Reichstag Foreign Affairs Committee in May 1922 with his usual startling, even brutal, frankness:

Insofar as the presently demanded shutting down of our note printing presses is concerned, we must not overlook the fact that in our printing of notes lies a kind of emergency weapon against the exaggerated demands of the Versailles Treaty. The French have the threat of further occupation as their sole means of pressure to push through these demands. But such an occupation will hardly bring them any advantage.

All the same, the obvious divisions among the Allies, and the stalemate that resulted, did nothing to help the German economy. So far as the immediate situation was concerned, Stinnes thought the French were bluffing. M. Poincaré thought the German government was lying.
17
This mutual distrust, fuelled by mutual incomprehension, did not bode well.

It was with these ominous aspects of the situation in mind that Foreign Minister Rathenau agreed to have dinner with the American ambassador, Alanson B. Houghton, on the evening of 23 June 1922. Also invited was Colonel James A. Logan, an American observer to the Allied Reparations Commission.

Over dinner, the subject came up of the coal supply crisis, which had grown painfully complicated in the last weeks. Germany was bound to deliver high-quality coal to the French and Belgians as part of the Versailles reparations in kind. This left Germany short of fuel for the urgent requirements of her own booming industries. In fact, she had lately found herself, even after being forced to import coal from Britain at world market prices, close to a partial shutdown of her steel and smelting plants.

Rathenau wanted to ensure that the Americans understood the full extent of the crisis. He also knew that Stinnes was in Berlin as part of a delegation of industrialists lobbying the government for concessions on the coal problem. So, at around 10.30, Rathenau suggested that the ‘King of the Ruhr’ be called over from his hotel to explain the problem from his expert point of view. This was done.

With this powerful additional guest present, the subject of their talk soon broadened out from that of the coal question alone. Thus, late in the evening, the high-minded Rathenau and the hard-headed Stinnes found themselves ensconced with their American hosts in easy chairs, talking reparations and inflation. This went on for three more hours. The two Germans found themselves defending their country’s policies. Both, interestingly, defended inflation, for all its economic and social disruption, as a ‘political necessity’. Stinnes explained it as a matter of ‘your money or your life’, adding that ‘when compelled to choose between the two, he always gave up his money’. They both insisted that inflation could only be tackled once Germany had a stabilising loan and a more reasonable reparations deal.
18

Characteristically, Rathenau was less brusquely definite in his approach than Stinnes. The Foreign Minister thought the inflation had gone too far, and especially regretted the damage it had done to the educated middle class, in which as an intellectual he – unlike Stinnes – had many friends and acquaintances. But he also admitted that inflation was a ‘necessary transfer of capital from one class to another’, as befitted Germany’s impoverished post-war position. After all, ‘a people that had become as poor as the German people could no longer sustain broad classes of the population living off wealth and pensions’. In effect, Germany could no longer afford Ernst Troeltsch and his privileged academic ilk.

As Logan would later report, Rathenau was also depressed by the incessant political violence in Germany, which was not only bad in itself but was undermining national morale. For the Americans’ benefit, he compared Germany’s situation to that ‘of a sane man taken and confined against his will in an insane asylum during a long period with the result that he gradually assimilates the mental traits of his associates’.

At half past one in the morning, Rathenau accompanied Stinnes back to his hotel, the very grand Esplanade on the Potsdamer Platz. They continued talking, just the two of them, until 4 a.m.

Stinnes would claim later that by this time the old differences between himself and Rathenau, so generally unalike in temperament and in their views of the world, and often strongly opposed on key issues, no longer existed. This, he maintained, their discussion that evening had proved. The truth of his claim could not be verified by his guest because this was, in fact, the last night of Walther Rathenau’s life.

The Foreign Minister understandably slept late on the morning of Saturday 24 June, not emerging from his villa in suburban Grunewald – No. 65 Königsallee – until after 10.30. His car, a relatively modest NAG cabriolet, was waiting to take him the ten or so kilometres into the Foreign Office, where he was due for a routine meeting with consular staff.

Rathenau sat in the back seat of the open-topped car, completely exposed to the public view. Despite a constant stream of threats to his life, he travelled with neither bodyguard nor security detail. His chauffeur eased the car out of the drive and set off at a leisurely pace down the wide expanse of the Königsallee. After a few hundred metres they began to slow down, ready to negotiate the sharp double curve that the Königsallee took shortly before joining the famous Kurfürstendamm at Halensee and continuing on into the city.

Opposite this turn in the road, a gang of builders were working on a building site. One of them described to a journalist what happened next:

Coming up to 10.45 two automobiles came down the Königsallee from the direction of
Hundekehle
.
*
In the front car, which was travelling more slowly and was sticking around the middle of the road, sat a gentleman on the left side rear seat, you could recognise him exactly, since the car was absolutely open, without even a sun awning. In the car behind, also quite open, a big, six-seater dark-field-grey powerful touring car, sat two gentlemen in long, brand-new grey leather coats with the kind of leather caps that just left the oval of the face visible. You could see they were quite clean-shaven, and they didn’t wear driving goggles.

The Königsallee in Grunewald is a very busy highway, so that you don’t pay attention to every car that comes along. But we all looked at this big automobile, though, because the fine leather clothing of the passengers caught our eye. The big car moved out on to the right-hand side of the road and overtook the smaller car, which was travelling more slowly almost on the tram lines, probably because it was getting ready to move out on to the big S-curve of the Königsallee, forcing it strongly to the left, almost on to our side of the street. When the big car was maybe half a vehicle’s length in front, and the solitary passenger of the other car looked over to his right, probably worrying there was going to be a collision, one of the gentlemen in the fine leather coats leaned forward and picked up a long pistol, cradled it in his armpit, and pointed it at the gentleman in the other car. He didn’t really need to aim, he was so close, I looked so to speak right in his eyes, and he had this healthy, open face, as people like us say, sort of an officer’s face. I took cover, because the shots could have hit us. And then the shots went crack-crack, quick as a machine gun.

When the one man was finished shooting, the other stood up, pulled the pin on an oval hand-grenade and threw it into the other car, which they were travelling very close to. Before this the gentleman had already collapsed back into his seat, really all slumped together, and was lying on his side. Now the chauffeur stopped, right on the Erdener Strasse, where there was a pile of rubble, and was shouting, ‘Help – Help’. The strange big car suddenly took off at full speed and roared off through the Wallotstrasse, which goes in a big curve past several new buildings which have got piles of stones right by the road and then gives out back on to the Königsallee. None of us could see a number plate on the big car, and there was no rear light to it either.

The car carrying the man who had been shot was meanwhile on the kerb, the chauffeur had bent down, and in that very same moment there was a bang and the grenade exploded. The gentleman in the back seat was absolutely lifted up by the air pressure, even the automobile made a little hop. We all ran over to the scene and found nine cartridge cases on the road and the pin of the hand grenade. Parts of the car’s wood panelling had been blown off. The chauffeur started his car again, a young girl got in and supported the gentleman, who was already unconscious and probably dead, and the car set off at a good lick back along the same way it had come, back along the Königsallee to the police station, which lies about 30 buildings further on at the end of Königsallee in the direction of
Hundekehle
. There he must have roused the police, because after 10 minutes two officers arrived on bikes and asked about the car. One headed off along the Wallotstrasse, the other along the Königsallee, looking for the car. But the car must already have had a quarter of an hour’s lead on them.
19

Such was the fate – the bitter reward – of the man who less than twelve hours earlier had been fighting Germany’s corner, along with the country’s leading industrialist, at the residence of the American ambassador: to die at the hands of a young man armed with a machine pistol and dressed in luxury grey leather, with ‘an officer’s face’, on the public highway on his way to the office to carry out a mundane, even tedious, official task.

Following the assassination of Rathenau, the government drafted laws for the ‘Protection of the Republic’. This set up a special State Court to try future cases and subjected conspiracy against, instigation of, or complicity in acts of violence against the Weimar state and its representatives to severe new penalties, which would be administered by the new court.

No particular enemies of the Republic were named, but shortly after the murder, Chancellor Wirth declared, perhaps in the heat of the moment: ‘The enemy is on the right!’ He expressed the horror and disgust felt by all the Republic’s supporters and by most Germans except those belonging to the still relatively small but growing ultra-nationalist minority. Hundreds of thousands, including huge columns of workers, spontaneously demonstrated on 28 June, the day of Rathenau’s funeral in Berlin. All work had stopped at noon. It was a mighty, united recognition of what Germany had lost in this man. The unseasonal weather – rainstorms alternating with sunshine – did nothing to deter the crowds.

Harry Kessler, a friend of Rathenau, described the scene in the Chamber of the Reichstag, where the funeral ceremony was held:

The coffin lay in state, mounted behind the speaker’s rostrum and under a huge black canopy suspended from the ceiling. The Chamber was hung with black and transformed into a sea of flowers and plants. Enormous palms flanked the coffin at its four corners. The speaker’s rostrum was shrouded in black and buried, as was the Government Bench, beneath magnificent wreaths with ribbons in the Republican colours, black-red-gold . . . The galleries, like the Chamber itself, were packed. There was not one empty seat, not even among the Nationalists. The focal point was the coffin, draped with a huge flag in the national colours. At its foot there lay two immense wreaths, of red and white flowers, to right and left of the colours.

At noon the Chancellor led Rathenau’s mother into the Imperial box. She sat down in the seat whose back was still embellished with a crowned W. The old lady was evidently in full control of herself, but her complexion was as pale as wax and the face behind the veil might have been carved from stone. These features, all colour drained from them through grief, touched me most. She stared motionlessly at the coffin.
20

The
Manchester Guardian
’s man in Berlin reported that monarchist flags had completely disappeared from the city’s streets.
21
Enormous crowds turned out to protest at the murder in other major cities: reportedly 300,000 in Hamburg, 200,000 in Leipzig, and 150,000 each in Munich and Cologne.
22

Rudolf Pörtner, then eleven years old, remembered many years later how a neighbour brought the news to their home in Bad Oeynhausen, a spa town of some six thousand souls on the River Weser in north-western Germany:

His name was Metzger, he was a foreman at the cigar factory, in which my father also worked. He was a Social Democrat and as such had been elected to the Oeynhausen town council. Corresponding to his position as a ‘city father’, he habitually assumed a distinct tone of gravitas in his relations with others.

. . . But now I saw him, from our kitchen window, rush out of his house, and with no regard whatsoever for etiquette, in his slippers, shirtsleeves, and his waistcoat unbuttoned, head for our front door. Soon the doorbell was ringing a storm, and when my father opened up, [Metzger] was fighting for breath.