by Tom Bower
Channel, the harmony between the three German confederates fell apart. Otto Lange bitterly protested that Ferdinand had broken his wartime promise and had deprived him of reward for all his work and risks. He threatened to renege on the whole deal and blamed his brother in Berlin for allowing Maxwell to benefit handsomely from the favourable exchange rate. Finally, he accused Maxwell of not paying the amount which had been orally agreed in London. Irritated, Maxwell flew to Vienna, accused Otto of breaking his wartime 'gentleman's agreement and his word of honour' to Ferdinand and then flew to Frankfurt. With the three Germans warring among themselves, Maxwell's own position had immeasurably strengthened.
While in Frankfurt, Maxwell negotiated with JEIA a new, special dispensation for Springer to dispatch books without the time-consuming need for Customs' clearance for each consignment; he then flew on to Berlin to negotiate an improved discount on the purchase price for EPPAC - 50 per cent on books and 40 per cent on journals. With his special exchange rate, Tonjes Lange calculated, Maxwell had by then effectively obtained an unusually high 70 per cent discount. As his success and wealth soared, Maxwell's horizons broadened. During his visit to Berlin in October 1948, he told Lange that he was planning a sales trip to Tokyo to exploit Springer's contacts with Japan's leading book-dealers, Maruzen and Nankodo. For a recently impoverished refugee aged just twenty-five even to contemplate a flight to the Far East just three years after the end of the war staggered the Germans. But by 15 February 1949, when Wagon No. 455 596, the seventh and last of the consignment, left Vienna, Maxwell already had under his control a reservoir of books and journals which would attract the attention of the whole world of learning.
Yet ostensibly Springer received no gratitude from London. Instead, Maxwell forcefully complained that Otto had broken his agreement, which gave EPPAC the sole distribution rights, in 'a most unethical manner'; apparently Otto had supplied other British dealers. Maxwell sent Otto a menacing letter: after accusing Otto of breach of the agreement and denying that he owed any more money, Maxwell suggested that since he had sold a mere £150 worth of books so far, he might ship all seven wagon-loads back to Vienna and in future place his orders like other booksellers. Otto did not reply.
For those who knew Maxwell in London, the smooth self-confidence which supported that threat was characteristic of the image that the handsome businessman presented. Despite the stringent post-war austerity under which the majority of Britons suffered, Maxwell never seemed to be affected by the Labour government's rationing of everything from bread and eggs to petrol and clothes. As he dashed around London, dressed in well-tailored suits, he seemed to have settled upon a lifestyle which few could afford. In 1949, he possessed a petrol-guzzling red Chrysler which he had brought back from Prague, and he would soon exchange that status symbol for a Cadillac which, because such cars were still banned for British subjects, was acquired on temporary import licence and owned by a foreign friend. Maxwell himself rarely drove his cars, but was chauffeured by an enigmatic and swarthy cockney, Bob Oglanby, whose antecedents were, to Maxwell's staff, mysterious. His insatiable appetite for luxury cars reflected his noticeable desire to impress everyone.
If Maxwell's poor childhood had instilled in him an appreciation of money and taught him the simple delight of grinding down his business partner by exhausting negotiations, it remained true that, in post-war Britain, wealth did not enhance one's social status. Maxwell's only social attributes in 1945 were the MC and his wartime rank. Although by custom only professional officers retain their rank in civilian life, Maxwell clung to his and to those bare letters as if his very survival were dependent upon them. Rigidly, Maxwell insisted on being addressed as 'Captain' for nearly two decades after the war. Even in 1969, Springer executives still addressed him in the fashion which, twenty-five years earlier, he had judged would earn some social status among Britain's uniquely class prejudiced society. In 1949, Maxwell had not finally settled upon his identity. The confusion is evident on his various business notepapers. The heading of EPPAC note-paper showed Capt. R. Maxwell MC, on Springer's letterhead he was R.I. Maxwell MC, yet his private notepaper was headed Capt. I.R. Maxwell MC. To complete the confusion, even when the letterhead stated R.I. Maxwell, he signed the letter I.R. Maxwell.
On one matter, however, there was no confusion. Maxwell was devoted to his family. By 1949, a second child, Anne, had been born. Like the remainder of his nine children, Anne was born at the maternity home, Maisons Laffitte in a suburb of Paris, France delivered by Betty's sister, a gynaecologist. All the Maxwell children are French citizens by birth, and have remained so. After Anne's birth, the family had moved into a larger flat in Kensington. The amount of time he spent with his family was limited by his work, but never, by all accounts, by play. His only recreations were the cinema and, on Saturday afternoons, watching Arsenal football club play at Highbury. 'I would love to own a football club,' he told a friend at that time. But in work, despite enormous energy and dedication, the results were still confused. Yaacov Schlomovitch had taught his grandson the talent of negotiating, to buy and sell, but not how to organise an office and staff. Haggling in the fields around Ruthenia did not require chains of management command of the type which Ferdinand Springer required.
In the summer of 1949, Ferdinand's dissatisfaction revived. It had taken one year to unpack, store and catalogue the Vienna stock, and EPPAC's inexperienced staff were still failing to keep proper records, to dispatch orders rapidly and, understandably for the inexperienced refugees, to grasp the importance of advertising. In Germany, Springer's staff, who reverently described Ferdinand as Der Kaiser, jealously watched Maxwell's windfall and his encroachment upon their work. Some harboured fears that he might ultimately inherit the whole business. To alleviate their complaints, Lange had decided to send his best dealers to help the London operation. At Springer's expense, Maxwell was learning the business, and he now conceived a scheme which would endow him with increased respectability. ·
On 14 July 1949 Maxwell suggested to Springer that EPPAC was 'not really suitable for the distribution of your world renowned publications' and proposed to create a new company which would be called Lange, Maxwell & Springer in which the Germans were offered 49 per cent of the shares for £10,000. Tonjes Lange would be the unpaid chairman, Maxwell the managing director and Orton the secretary. The Springer directors were interested in the idea. Although the Berlin blockade had been lifted and Konrad Adenauer would soon be appointed Chancellor, they were still unsure about their prospects and felt that they might gain more direct control over their business. One week later, Lange agreed and effusively thanked Maxwell for the 'honour' of becoming the chairman. Jubilant, Maxwell sent to Lange, whom he now called Charlie, the proposed articles of association with the quip: Tf you are clever enough to understand what they mean, then I lift my hat to you. I think the lawyer's language used in these things is appalling. However no doubt you will send me a complete translation in Chinese, in which case I shall, of course, understand it.'
Maxwell's conception of LMS was a quintessential example of his business acumen. Under his proposed scheme, Maxwell was the manager of two companies which, while theoretically they would work together, could place him in an embarrassing conflict of interest. Under the agreement, EPPAC contracted with Springer that their joint company, LMS, would distribute all Springer books outside Germany. But EPPAC would not cease to trade since it was EPPAC which was officially importing Springer's books from Germany. So EPPAC would sell its stock to LMS but would continue to trade under Maxwell's management while promising not to compete with LMS for the next ten years. It was a simple arrangement which revealed the essence of Maxwell's future operations: namely, compartmentalisation. 'Everyone works in blinkers except Maxwell,' said one of his trusted advisers twenty years later. 'Only he knows the master plan and that keeps changing.' Securing Springer's agreement to that duopoly was a masterstroke which launched Maxwell closer towards the millionaire status which he craved.
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To establish LMS on a sound footing needed finance. Whereas nowadays almost anyone may approach a bank for a loan, in 1949 it was the privilege of the rich and the respected. Since status was a commodity which Maxwell did not naturally command, it was a major coup when he obtained an interview with the merchant banker, Sir Charles Hambro, to discuss a loan. Although there are suggestions that Hambro, who was attached during the war to Special Operations Executive, the British sabotage organisation, had met Maxwell in an Intelligence role (since Maxwell would occasionally hint at his connections with British Intelligence), Maxwell says that the meeting was in fact arranged through Major John Whitlock, a former SOE officer and executive of the publisher Butterworths who enjoyed a reputation as a freemason and 'likeable rogue'. Hambro was interested in both science and publishing, so Maxwell, who eloquently portrayed LMS's glowing future, was not disappointed. Hambro agreed to a loan of £25,000, the present-day equivalent of a quarter of a million pounds. Maxwell left the Bishopsgate building ecstatic, and cabled Lange the good news that their new company was firmly operational. He had found a new godfather. Tt was Charles Hambro', Maxwell told Gunther Heyden, an employee in later years, 'who taught me the importance of having a chauffeur. You must think about the business, not about getting to the meeting.'
Yet within days of the new company's incorporation in October, there was a crisis. Writing from Berlin, Tonjes complained to Maxwell that he felt isolated, uncomfortable and helpless and feared that Maxwell was more than ever exploiting Springer's reputation and keeping his German partners in the dark. Maxwell, wrote Tonjes, seemed to ignore advice and was even signing letters as 'chairman'. Worst of all, Tonjes had confided to Orton that he could not always trust what Maxwell said.
Maxwell felt genuinely hurt by the reprimand. ‘I value your personal friendship and esteem more than anything else in the world,' he replied to Tonjes, whom he felt had not understood the enormous obstacles he had faced in establishing the business. Even if London was not as physically destroyed as Berlin, there were myriad problems, which Maxwell listed: inexperienced staff, tax disputes, overcoming the legacy of wartime and socialist regulations. 'It doesn't feel good', Maxwell scribbled at the end of his five-page explanation, 'to receive such scoldings from one's "father" and teacher.' Tonjes's distrust irked: 'Should you ever in any way or manner whatsoever feel or say that you cannot trust my statements, then immediately from that minute I would wish to resign from that association.' The crisis was, for the time being, resolved and, as Lange would often repeat, 'Maxwell gave us enormous and valuable help over those years.'
But Ferdinand and Tonjes were convinced that some of Maxwell's more far-reaching ambitions should be curbed. Maxwell had proposed that LMS should also become a publisher. The idea was flatly rejected. Instead, Springer opted for an invitation from Butterworths, one of Britain's most venerable publishers, founded in 1818, to form a joint company. Ferdinand's motives were simple. Maxwell had proved to be a trader not a publisher, so he would be confined in the new joint venture to simple distribution.
The link between Springer and Butterworths was Dr Paul Rosbaud, a 53-year-old Austrian metallurgist who was the prewar advisor of Springer's major journal Naturwissenschaft. To this day, Rosbaud's wartime career remains a mystery. Although he was credited with aiding the destruction of Nazi Germany's heavy-water programme, some suspect that he was also the source in 1939 of the famour 'Oslo' report which provided British Intelligence with a detailed insight into unimagined inventions which German scientists had placed at the disposal of the German military. Because the report was so authoritative and suggested German developments which far surpassed British achievements, it was disbelieved, but in the course of the war it proved to be totally accurate. Its authorship has never been officially revealed. Nevertheless, Rosbaud clearly enjoyed good connections with senior British personalities because on 25 November 1946 he was present at a meeting in the Cabinet Office in Great George Street under the chairmanship of Sir John Anderson, an under-secretary.
The government, having belatedly recognised the importance of science, hoped to encourage the development of journals similar to Springer's and wished Butterworths to be the publisher. Most of those gathered at the November meeting were senior representatives of the British scientific establishment and members of the new Scientific Advisory Board. Others present were the merchant banker Sir Charles Hambro, Hugh Quennell, the mercurial representative of Butterworths who, as a Control Commission officer, had met Maxwell in Germany, and Count Frederick Vanden Heuvel, alias 'Fanny the Fixer'. During the war, Vanden Heuvel had been a senior British intelligence officer in Switzerland. Since 1945 he had posed as a colourful businessman whereas in reality he was the M.I.6 officer responsible for monitoring, recruiting and gathering reports from westerners travelling in communist Europe. Vanden Heuvel's meagre knowledge of science nevertheless elevated him to the status of expert when compared with the other laymen present who included former officers in SOE. Many years later it would be suggested that Maxwell was being employed by M.I.6 deliberately to gather scientific journals from Russia but the evidence is speculative and circumstantial.
The result of that meeting was the foundation of Butterworth Scientific Publications. But the company failed to flourish and so, in 1949, after Ferdinand had rejected Maxwell's suggestion, a joint company was created called Butterworth-Springer. Rosbaud was appointed the editor of the scientific journals and it was agreed that they would be distributed by LMS.
After just two years, Maxwell was the managing director of an important book distributor which was recognised by the City, the publishing world and the government. But it was not enough. Fifteen years earlier, Maxwell had observed that his grandfather Yaacov Schlomovitch never confined himself to a single deal. Unlike his father Mechel who just dealt in cattle, Yaacov always managed a collection of parallel but unconnected deals. He was constantly juggling, keeping as many deals going simultaneously as he could. Instinctively, Maxwell searched for the same.
Tonjes was possibly the first to recognise Maxwell's inheritance of that talent. In later years, he recalled eating in a Berlin restaurant in 1950 with Maxwell when he noticed his associate listening to the conversation in a foreign language at the neighbouring table. Afterwards Maxwell explained that the Hungarians were discussing a barter deal and if he acted quickly he might profit from the information. Tonjes was bewildered but admiring. He had not realised that Springer's worldwide manager was also a player in the barter trade - a testament to Maxwell's natural compartmentalisation.
Barter is the oldest form of trade, used before coinage was invented. For poorer countries, who after 1945 either had no hard currencies or faced politically motivated trade embargoes, bartering their own produce was the only means of obtaining important foreign goods. In its essence, barter is a simple bilateral exchange, but by the early 1950s Maxwell would become involved in hugely complicated, multilateral deals which would embrace several countries and many different commodities - pork bellies were exchanged for wood which was bartered for silk which might be exchanged for a metal. Success in those barter deals required all the skills and guile of a businessman, and more. So much depended on racing to close the circle before any of the interdependent deals collapsed. Like a juggler, the dealer's success was to keep a huge number of balls in the air which required exceptional mental agility. Throughout his career, his adversaries and friends alike have commented upon Maxwell's phenomenal capacity to retain and instantly recall information. Combined with his charm, fluent sales talk and tireless determination, this facility made him exceptionally skilful in constructing the circle for a barter deal. Lange and Springer were eyewitnesses to one refined brand of Maxwell's style, but Gunther Heyden saw another.
In 1948, Gunther Heyden was just twenty years old. Born in Cologne, he had spent the war in hiding in Germany after his Jewish mother had committed suicide. After the war, he found menial jobs with both the American and British armies until he was e
mployed by PRISC in Berlin to supervise the licensing of cultural activities. Over the following two years, he 'quite often' saw Maxwell in Berlin, occasionally dressed in uniform even after he had officially resigned. 'Maxwell dropped into the Commission's press club, discussing business with contacts,' Heyden remembers. 'He was always in and out doing deals.' The deals had no connection with books or scientific publishing but were, on behalf of Low-Bell, for unaesthetic commodities such as brushes and cotton waste. No deal was better remembered than Maxwell's coup to sell paint to German railways.
The German requirement for paint was, as usual, formally issued by JEIA in Frankfurt. At the former headquarters of IG Farben, the German chemical conglomerate, Maxwell was a familiar figure, especially to Paul Lassen, a British officer attached to JEIA who was responsible for vetting contracts in the food and agriculture section. Lassen's office was situated on the so-called 'Polish corridor' where everyone who wanted a slice of the lucrative business congregated. Lassen candidly admits that the potential for anybody to benefit by corruption was enormous: 'I vetted every contract and could have made a fortune.' Lassen's friend, Bill Hickey, who was responsible for the paint contract, was visited by Maxwell and Louis Berger, the paint manufacturer. Twenty years ago, Berger told the Sunday Times how impressed he had been by Maxwell's dynamic organisation, by his ability to obtain visas and transport and by his winning $40 in a poker game with American soldiers to pay for their expenses in Frankfurt. Most of all, Berger was thrilled that Maxwell obtained the enormous $1 million contract for the paint. While Lassen believes that Berger never delivered and was never paid, Heyden says that Maxwell delivered not only the paint but also the brushes. The two JEIA officials impressed Maxwell and when their contracts ended in 1950 both were employed by him to implement his more intricate deals.
