The House of Wittgenstein: A Family at War

by Alexander Waugh

  This memorandum will not be seen by Professor Wittgenstein. He has particularly asked that he not be shown a single part of it for he is particularly anxious that this be presented as an objectively prepared historical document and not as an apology. He insists that the writer should feel no obligation except to write the absolute truth.

  In the matter of Gretl's dealings with Arthur Seyss-Inquart, the report concludes:

  Mrs Stonborough evidently felt in 1938 and 1939 that there was such a thing as an obligation of honor owed to a Nazi, that the Nazis were people with whom one did business on the basis of honor. If we regard her charitably, the best we can say for her is that she was a very silly woman.

  The result of the first passport-fraud trial had been fixed in advance. Quite how is not known, but it now appears that Gretl and Hermine turned down the offer of an adjournment when their Jewish defense lawyer was dismissed because they were confident that they had already "negotiated themselves out of it," and that they knew from the start that Judge Standhartinger was poised and ready to acquit them. The appeal case, however, was likely to be a lot trickier. This time they were terrified that it would be dealt with by a higher authority in Berlin, by people beyond their sphere of influence, who might not "regard us as the eminent ladies Stonborough and Wittgenstein, who had trusted a crook, but rather as two old Jews juggling with false passports." Once again Gretl's contacts came to the rescue, as Hermine revealed: "Gretl and some good friends again found means of preventing the new court proceedings. A suitable man was found who was to change the Public Prosecutor's attitude, and he succeeded. The appeal was withdrawn and we were delivered of this serious anxiety."

  This "suitable man" was probably Alfred Indra, the lawyer and Viennese operator who had represented Arvid Sjogren, Helene's son-in-law, at the original fraud trial. Shortly after that he was asked to represent Gretl in various battles with the authorities concerning her property. Ji described him as "a gent and on very good terms with thousands of people. A fixer." Dr. Indra, whose father and uncle were both senior government ministers, was one of only three lawyers during the Nazi period who represented both the Nazi authorities and the well-to-do Jews whose property was threatened with confiscation. In a totalitarian state such as Hitler's Germany, hiring a lawyer to fight the government was not a serious option. A plaintiff wishing to take his case to the courts was offered, by the authorities, a choice of three approved lawyers to represent him. These were Hans Frank, Erich Zeiner and Alfred Indra. Clearly, if any of them fought the case of their clients too brilliantly they would be removed from their posts. Indra's most famous client in 1938 was Sigmund Freud. After the war he represented Freud's heirs in their efforts to retrieve something of the psychoanalyst's confiscated estate, but all his files (so he claimed in 1961) were ransacked first by the SS and later by the Russians.

  Dr. Indra had been introduced to Freud by Princess Marie Bonaparte (Gretl's friend from Luzern days) and it was he who organized the Professor's emigration to London and he who drafted the chilling and wholly mendacious declaration for the octogenarian to sign before he left:

  I hereby confirm of my own free will that as of today, June 4th 1938, neither I, nor any of those around me, have been harassed. The authorities and representatives of the NSDAP have always conducted themselves correctly and with restraint towards me and those around me. Prof. Dr. Sigm. Freud

  Dr. Indra was forty-four years old in 1938, six foot two inches tall, dark eyed, slick and deceitful. He had been educated at the Theresianum--the same smart Viennese school that Ji attended eighteen years later, and the younger man looked up to him as the impressionable first-year looks up to the square-jawed sporting hero of the upper-sixth. "Indra was a very handsome man," he later recalled. "A wonderful lawyer... One who knew how to hunt with the hounds and run with the hare ... A great help!! ... He and I were of course on Theresianum terms of 'Du.' " Dr. Indra's trick was to give his clients the impression that he thought the Nazi authorities were stupid and ignorant and that he was entirely on their side against them. This the Stonboroughs swallowed easily, and if Dr. Indra had indeed been instrumental in dissuading the Public Prosecutor from his appeal against Hermine's and Gretl's acquittal, who could blame them?

  The aging ladies were, after all, worth more to the Germans outside prison than in it, for they held the keys to the vast fortune in gold and foreign currency that the family kept in Switzerland, a fortune on which the Reichsbank was impatient to get its hands. The house of a German citizen who refused to exchange his foreign savings for Reichsmarks would normally be raided by the Gestapo and its occupants thrown into prison, but the Wittgenstein case was complicated. The assets of the fund, supposedly locked under the terms of incorporation until 1947, belonged to many people, some of whom (Ji and Gretl) were American citizens, and another of whom (Paul) had escaped German jurisdiction. The directors included Ludwig (soon to become a British citizen) and Otto Peyer, a Swiss businessman, neither of them under any compunction to obey German law. If the Nazis were to get their hands on the pot, they needed all parties to be persuaded, but this could hardly be achieved with Gretl and Hermine languishing in prison for passport irregularities, and the authorities soon realized that their best hope was to use them to persuade the others to release the funds.

  At the beginning of November 1938 Dr. Indra had asked Ji to go to Zurich to entice Paul back to Vienna as an act of goodwill toward the authorities before leaving for America. The meeting took place over breakfast at the Hotel Savoy Baur en Ville. Ludwig was also present. He had come to help sort out the liquidation of the trust and, since he had given all of his own assets away, was considered a helpful and impartial adviser in the matter of how this might best be done. The Reich-wide anti-Semitic Kristallnacht pogroms, during which over 1,000 synagogues and Jewish businesses were destroyed and 100,000 Jews arrested, had taken place only days earlier and the international press was full of it. The risks of returning were too great for Paul. During the discussion Ji told a risque joke that both his uncles found distasteful.

  When the Reichsbank realized that Paul would not return to Vienna it stepped up the pressure concerning the Wistag fortune. Max Salzer and Anton Groller were threatened with imprisonment. An urgent meeting was convened at the Palais, attended by factotum Groller, Max Salzer, Hermine and Gretl. Only Gretl brought her own legal adviser to the meeting (the sinister Dr. Indra), for she it seems had her own agenda.

  The purpose of the meeting was to discuss with Dr. Johannes Schoene, the legal representative of the Reichsbank from Berlin, means by which the Wittgenstein fortune could be paid to his bank. Dr. Schoene was an ambitious lawyer in his early thirties, a signed-up member of the NSDAP, very short, very blond with arresting blue eyes--a sort of Hollywood Nazi archetype. "You know," he said to Hermine, "there are those in Berlin who are dismayed to learn that your family still holds such a large fortune abroad. One of them recently said to me: And are you saying that these people are still running around free?' " A heavy hint of threat seemed to underscore all of Dr. Schoene's utterances, but he must have had a little charm, for Hermine later described this same meeting as "very friendly."

  Gretl had learned from her son Thomas that, in cases where a family's foreign assets were held abroad, concessions could be made if the family was prepared to break up the trust early. This seemingly obvious point filled his mother with optimism and she spoke up at the meeting with an energy that impressed her elder sister as "comparable to that of our father." Her proposition was simple: "if you wish us to liquidate the trust you must pay us to do it, and the price that we demand is full citizenship rights for Hermine and Helene." This Dr. Schoene initially suggested might be possible but, he warned, it would need to be agreed in Berlin with the Reichsbank's Head of Foreign Exchange, Dr. Gorlich.

  The Berlin meeting, which took place at the bank's offices in the Vic-toriastrasse on May 2, was attended by many of the same participants as the earlier conference in Vienna. Dr. Gorlich put the
case to Gretl and Hermine bluntly:

  Either you can emigrate, in which case we shall permit you to keep a small portion of your foreign fortune, or you can stay in the Reich and like everybody else change all your foreign money into Reichs-marks. I assume that you will be choosing the first of these two options as I cannot imagine that you would wish to stay in this country as exception-Jews, against the expressed will of the Fuhrer?

  Hermine did not answer but hoped, by her silence, that Dr. Gorlich would understand that staying in the German Reich was precisely what she intended to do.

  As to the sisters receiving Aryan treatment, this, he insisted, was out of the question. They were Jews and that was that, but when Anton Groller mentioned that a branch of the Wittgenstein family was convinced that Hermann Wittgenstein was the illegitimate son of an Aryan prince, Drs. Gorlich and Schoene seized upon this information as a possible solution, giving the strong impression that they would do anything to help the family twist it that way. In point of fact they were adroitly playing an old game, pretending, on the one hand, to be sympathetic to the family plight while, on the other, threatening that if matters became too complicated they would have to pass the Wittgenstein file to the Gestapo. Gretl seems to have fallen for the ruse: "Our friendship with the Reichsbank began at that point," she told Hermine. After the meeting her passport was returned to her and three days later she boarded the SS Washington at Southampton bound for New York.

  NAZIS ARRIVE IN AMERICA

  Anton Groller had been employed by the Wittgensteins for most of his working life. While shocked by their recent treatment as Jews, he was much in favor of the Anschluss and a keen supporter of the NSDAP. Immediately after the meeting in Berlin he contacted Paul. "The Germans," he said,

  have been very generous. They have made you a definitive offer. From your share of 3.4 million Swiss francs they are going to allow you to keep 2.1 SF, a great sacrifice, I know, but one I expect you to make. Furthermore they will permit you to travel freely in and out of Austria. They will not, however, guarantee any concession concerning the Aryan treatment of your sisters. In return, they require an immediate gesture of goodwill from the family. We suggest you release all the gold to them right away.

  Paul's reaction was not enthusiastic. The offer of permission to travel in and out of Austria meant nothing to him, as the criminal charges against him had not been withdrawn and, in any case, he remained always a Jew, stripped of citizenship rights. If he returned to Vienna he would be seized by the Gestapo and forced to surrender even his 2.1 million Swiss francs. Nor was he happy about conceding the gold reserves to the Reichsbank with no guarantees about his sisters' treatment. Ji too was vehemently opposed to such a move and spoke in excitable, high-pitched tones to Paul of his promise to help protect his uncle's fortune from what he called the "prole Nazis," of his resolution to give away as little as possible and to fight the Germans at every turn. Uncle and nephew were in complete agreement that whatever concessions had eventually to be made must be to the greatest possible advantage of Hermine and He-lene.

  Gretl arrived in New York on May 12, 1939, exactly one week before the German ship SS Columbus with Drs. Schoene and Indra on board. Konrad Bloch, a Swiss lawyer representing the Wistag Trust, was also in America but, because his English was poor, he had instructed a bilingual New York solicitor to share his brief. This was Samuel Wachtell, a scrupulous, hard-working and honest attorney whose office had spent thousands of man-hours sorting, free of charge, the immigration papers of Jewish clients fleeing the Reich.

  The first meeting of all parties took place on May 19 at the Gladstone Hotel on 52nd Street and Park Avenue. In the days before, Ji's adamantine resolve to prevent the Germans taking all the gold had already crumbled. Gretl had insisted that he sign it over--all 2.5 million SF worth--and she was a formidable woman, "a fighter who brooked no interference." Anton Groller meanwhile told Paul that the Germans would not allow him to keep any of his fortune if he too did not consent to handing over the gold. This he reluctantly did. "How unexpected," was Dr. Schoene's sarcastic reaction to the news that such a high advance had been conceded. "The Reichsbank would have been satisfied with far less than that." Gretl swept into the meeting without greeting Dr. Bloch and Dr. Wachtell. She had brought along her own New York attorney, Abraham Bienstock. Dr. Indra, who only a week earlier seemed to be representing her interests against the predations of the Reichsbank in Vienna, was now in New York as Dr. Schoene's understrapper, representing the Reichsbank. Paul had no idea who Indra was and simply remarked, "he never opened his mouth in my presence so that it was not at all clear whom he represented." At the outset Paul stated that he was willing to make sacrifices for his sisters in Vienna, but stressed also the danger that he was in:

  Since I came to America far too late, all available paid positions at conservatories have been taken. I cannot work other than as a piano teacher, for I am no use at anything else--What idiot would employ an impractical one-armed man, when the best-qualified men with two arms in their hundreds are wandering about jobless? Even if a well-paid job were offered me I would not be able to take it for as a "visitor" to the US I am under an obligation to earn no money.

  Dr. Schoene's response was icy. Despite the family's goodwill payment of the gold he had now decided that 2.1 million SF was far too much for Paul. The Reichsbank, he said, might consent to 500,000, or maybe less. Paul, predictably, lost his temper and the meeting was adjourned.

  Gretl and Ji departed immediately for Washington. Dr. Bloch took Paul to one side and told him that he mistrusted his sister as, on more than one occasion, she appeared to be siding with the Nazis against him. This Paul dismissed. "It is only apparent," he replied. "My sister has not the slightest reason to favour the Reichsbank over me. We are not on good terms, but she is not capable of dishonourable conduct." At the next meeting, however, he changed his mind.

  It was crucial that all parties on the Wittgenstein side should agree a common strategy against the Reichsbank, but during their absence in Washington Gretl and Ji neither could nor would allow themselves to be contacted. Dr. Bloch telephoned their lawyer only to be told that he had been instructed to speak to no one. On the day of the meeting Gretl rang to say that neither she nor her son would be able to come early but would instead be arriving at the same time as Indra and Schoene. Dr. Bloch sprang a surprise, so that when she entered the room she brusquely demanded: "Where are the Germans?" "We have canceled them," he said, "so that we may first decide what we are going to tell them." Gretl was visibly shaken but took her seat while Dr. Wachtell opened proceedings with a recapitulation of the case in a few short words. When he had finished Ji, adopting a ministerial tone, said: "I listened with considerable interest to your somewhat lengthened explanations, but I wish to say that there are people present who do not understand anything and I do not wish them to be here."

  "If you are referring to me," Dr. Wachtell answered, "you are mistaken. I have fought similar disputes with the Germans and I know how to treat the matter."

  "I am not referring to you."

  "Then to whom do you refer?" Paul asked, bridling at what he later termed the "loutish impudence of my stinking louse of a nephew."

  "I allude to my uncle Paul and Dr. Bloch," Ji said. "I have no time to hear them and in any case everything must be settled in thirty minutes as I have a train to catch."

  "I don't give a damn about your train!" shouted Paul, infuriated by the suggestion that a million-dollar fortune should be negotiated according to a railway timetable.

  "And I don't give a damn about your money!" screamed Ji, slamming the table with his fist.

  Gretl immediately summoned her brother into an adjacent room where she told him: "You have no right to defend your money. You would not be here at all if it were not for me."

  When they returned the quarrel flared up again and just as Paul was on the point of conceding his whole fortune in a temper to the Nazis, a high-decibel shriek brought the assembly to sudden sile
nce. "STOP!!" Samuel Wachtell, the Wistag attorney, seeing the danger that Paul was in was calling for an immediate adjournment. Ji and Gretl rushed off angrily to the station. The next day Paul received a letter from his nephew enclosing a bill for his and his mother's travel expenses to Washington. "It would have been better," he wrote, "if we could have come to some understanding." Paul sent a telegram by return: PERSONALLY SHALL TAKE NO MORE PART IN PROCEEDINGS. ADVISE YOU TO GET IN TOUCH WITH MY LAWYER DR WACHTELL."

  "Back then," Paul later recorded, "Wachtell literally saved me from starvation. If he had not yelled 'STOP' I would have left this meeting a beggar--a beggar who does not even know in which country he is allowed to beg!" From that day Paul never spoke to Gretl again, nor did he have any further dealings with his "louse" of a nephew.

  THE STONBOROUGHS' MOTIVATION

  Why were Gretl and Ji apparently so anxious that Paul should hand the whole of his fortune to the Reichsbank? Konrad Bloch believed that the reason was connected to Ji's prospects of inheritance as he was an heir to Hermine and she would receive Paul's fortune, which even at the Reichs-bank's rate of exchange would be worth something in years to come. Paul had other suspicions. He sensed that the Stonboroughs were trying to bring about the liberation of their art treasures in Gmunden and in the Kundmanngasse. "That is only a suspicion--I explicitly emphasise that," he wrote. "Nevertheless I consider it to be very likely that Schoene, for whom, as a representative of the Reichsbank, no means would be too base, held out this prospect to them."

  There is another possibility. The evidence shows that the Germans used the threat of Hermine's imprisonment and confiscation of all her Austrian property to exert pressure on the family--and in particular on Paul--to relinquish its entire interest in the Wistag Trust to the Reichsbank for conversion into Reichsmarks. While Gretl was in America she was safe from criminal prosecution, but her extensive Austrian properties were vulnerable. Gretl and Hermine may have been threatened that if Paul did not agree to the Reichsbank's demand for the total sum of the Wistag Trust, the Germans would pursue them for the shortfall, seizing both their properties and imprisoning Hermine for failure to comply with foreign currency laws. This may explain a throwaway remark in Hermine's memoirs. Referring to the Reichsbank meeting in Berlin at the beginning of May 1939 she wrote, "Finally it was decided to allow Paul a sum of foreign currency that seemed to me rather high." Why, when his share in the fund was worth 3.5 million SF, did she consider 2.1 million "rather high"? What difference did it make to her how much of his own fortune her brother was allowed to retain? Unless, of course, she believed that she and Gretl would have to make good the difference.