The Merchants of Death

CHAPTER XI THE EVE OF THE WORLD WAR—THE ARMS MERCHANTS

An ordinary firm may utilise all available means for securing business on profitable terms. Ordnance manufacturers, in the nature of things, adopt a similar policy; but because the transactions are with the home and foreign governments, special objections are taken to methods which find numerous parallels in ordinary commercial life. A firm must study its customers and must maintain the closest possible touch with probable requirements. Some people will never understand business.—Arms and Explosives, journal of the British arms industry.

THE modern arms maker is the result of the Machine Age. Rapid technological development and mass production in the arms industry raised the problem of markets and business methods. The sales methods which the arms merchants evolved in the course of time are fundamentally the same as those employed by Big Business everywhere. But because the arms merchants dealt so largely with governments and because their activities so frequently played into national and international politics, their business methods have been subjected to a much closer scrutiny. Many of these methods have already been touched upon; they will be summarized here for purposes of emphasis and further elaboration.

Choice of Directors

The armament makers follow the same practice, due regard being had to the special needs of their industry. In Great Britain they choose their directors from the nobility and from members of Parliament, the Army, or the Admiralty. These names will aid them in securing business, in establishing a front of respectability, and in silencing criticism.

In France, the armament makers’ boards are made up largely of the great industrialists and bankers. All of these maintain very close relations with important members of the Chamber of Deputies. Many French political leaders are outstanding corporation lawyers, and this makes the tie between the arms makers and their best customer even closer.

These international trusts insured the arms merchants against all possible developments. In peace time they could solicit business everywhere, because their local directors would make the proper contacts. Since most of the larger companies also maintained branch factories abroad, the plea of “home industries” could frequently be made. In war time a separation of some kind might become necessary, but this could readily be patched up again when peace returned. Thus the Great International, which political idealists and labor strategists have sought for so long, was actually taking shape in the armament industry.

Maintaining Close Relations with Governments

The relations between the military departments of governments and the armament industry are always very close. This is attributable just as much to governments as it is to the arms makers. All governments still believe in military preparedness as an essential of national life; hence they foster and aid the arms makers and coöperate very closely with them. Armament makers, on their part, woo the government and its officials, so that their particular company may be favored when government contracts are given out.

On the other hand, the individual arms company does all it can to “keep in close touch,” so that it may obtain government orders. In Great Britain it has become an established practice of the armament men to place retiring admirals and generals on their boards. The reason for this was well expressed by Arms and Explosives: “they know the ropes.”

Bankers

Armament work must be financed, and the operations frequently demand large sums and impose the utmost secrecy. Hence armament makers either get control of powerful banks for themselves or they find bankers whom they can trust. In every great country certain banks are known as the “armament banks.” The Banque de l’Union Parisienne takes care of Schneider’s finances, the Deutsche Bank was the banker for the Germans, Morgan takes care of the Americans, the Oesterreichische Kredit-Anstalt für Handel und Gewerbe and the Ungarische Allgemeine Kreditbank did the financial work of Skoda.

The work of the arms men frequently involved the necessity of granting international loans, and there again their close connections with both bankers and governments were very valuable. Sometimes the bank would undertake to float such a loan, sometimes the arms maker’s government would advance funds to the foreign state. The complications into which this might lead are shown by the Putiloff affair in Russia and the Bulgarian armament orders of 1913. In postwar days, France has cemented her friendships and alliances with Poland and the Little Entente with heavy loans, many of which were earmarked for payment of armaments “made in France.” Loans to China by various governments frequently stipulated similar conditions.

The Press

The press is too powerful and important to be neglected by the arms makers. Hence none of the great arms merchants are without their press connections. Sometimes a newspaper is bought outright; sometimes a controlling interest is sufficient; sometimes influential newspapermen or owners are put on the payrolls or on the directorates of the armament makers.

In practice the control and use of the press works out in various ways. Newspapers live from advertising. Now armament makers seldom advertise their military wares, although this has happened. It is much better to advertise their ordinary industrial products, such as railroad tracks, machines, construction materials, etc. But the same purpose is frequently served by this kind of advertising. Where the press is venal, the journal may be paid for a series of articles on “the dangers of disarmament” or similar subjects.

The arms merchants have likewise put the moving picture into their service. The Barrow works of Vickers-Armstrong have their own moving picture theater where prospective buyers may see exhibitions of tanks, warships, machine guns, etc. in action. These special films of the arms makers are also taken on tour to various nations in order to demonstrate before the very eyes of the purchasing agents what effective killing machines are for sale.

A report of one of these foreign showings appeared in the North Mail on December 5, 1931: “A special exhibition of British films was given to the King and Queen of Yugoslavia in their new palace at Dedinje. The films were productions made by a British firm of armament makers. There were tanks of all kinds, as well as field guns of all calibers and tractors. A firm of shipbuilders also showed a film of the launching of a Yugoslav warship.”

War Scares

When international relations become strained, the business of the arms industry generally improves. Hence when nations manage to get along with a minimum of friction, the arms makers have sometimes not hesitated to stir up trouble. Every nation has “natural” or “hereditary” enemies. The arms makers need do no more than to point out the increasing armaments of the “enemy” and the virtual “helplessness” of the “threatened” country and before long there is vigorous action for “preparedness,” which in turn means business for the arms merchants. Sometimes it is sufficient to sell to the “enemy” the latest engines of war and then to apprise the other government of that fact.

The Mulliner war scare in Great Britain has been considered. The Gontard affair in Germany is just as instructive. Paul Gontard was (and is) one of the mightiest men in the German armament industry. As director of the Ludwig Loewe Company he was eager to get orders for machine guns from the German government. Accordingly he sent a letter to his Paris representative suggesting that an article be inserted in Figaro declaring that the French government had decided to speed up its machine gun program and to double a recent order. The fact that it was taken for granted that such a notice could be inserted in this French journal speaks for itself.

The procedure suggested by Gontard was too crude for the French press, particularly since the story was not true. Another approach was found. A number of French papers, including Figaro, Matin, and the Echo de Paris carried articles reporting the superiority of French machine guns and the advantage these gave to the French army.

Military Missions

The “backward countries” of the world have frequently sought the aid of their Big Brothers in training them for war. Hence the system of military and naval missions, to which now are being added aviation instructors. The byproduct of this arrangement generally is armament orders for the country from which the mission hails.

In pre-war days the British had a naval mission in Turkey, while the Germans trained the Turkish army. Armament orders were divided between the two countries. Japan’s modern navy was trained by the British, who also furnished many battleships and vast naval armaments. The United States maintains naval missions in various South American countries, and the American armament men consider this field so promising that they issue their catalogues also in Spanish. China has of late been the scene of American aviation activity. The American companies have furnished an air mission and are selling airplanes to the Chinese at the same time.

Stock in Armament Companies

Bribery

Sabotage

The arms industry practices public testing. Krupp’s proving ground at Meppen was open to the ordnance engineers of all nations. The purpose of the test was to demonstrate the efficiency of the new invention and to sell it; hence secrecy could hardly prevail.

After a successful test, the new device or weapon was offered freely to all. Whoever was willing and able to pay a license fee and a stipulated royalty could secure exclusive rights of manufacture in his country. Krupp’s armor plate is the classic example of this.

Furthermore, most of the technical problems of the arms industry are problems of engineering and chemistry. As might be expected, the journals in these fields also deal with the developments in the arms industry. Even a casual examination of such journals as Engineering, Cassier’s Magazine and the American Machinist reveals that all the latest guns, cannons, and war machines are fully discussed. Detailed drawings are generally given showing the construction and operation of these new inventions. Secrecy is impossible under such conditions.

Many arms makers established branch factories in other countries or they contracted to build arms factories for other governments. In either case all the patents and processes of the company were transferred to the other country, particularly since there was generally a clause in the contract binding the foreign company to that very thing.

On the eve of the World War, then, it was clear to all observers that the “next war” would be a gigantic and terrifying affair. The prophets of doom foresaw a titanic conflict in which armies of millions would face one another with countless new and monstrous death machines, developed and sold indiscriminately to all nations, by the arms merchants. They foretold deaths by the millions, the exhaustion of world economy, the pauperization of nations, and a grave threat to human civilization. Unfortunately, the prophets, for once, were right.