IBM technology helped the Nazis carry out the Holocaust. But to what extent can we blame the tech giant?
It’s a disgrace to history to ignore the power that technology has in facilitating acts of evil — and IBM’s work with the Nazis serves as a prime example of that facilitation.
Beyond questions of morality, the Holocaust presented a number of logistical hurdles to the Nazis, and IBM offered them a perfectly legal solution. Indeed, during the mid-20th century, the software company’s punched-card technology helped the Nazis carry out the genocide of millions.
First, it’s important to note that the Holocaust was at its core a highly organised and bureaucratic act, one planned to the T. Thus the Führer’s Final Solution would take place in six phases: identify those of Jewish descent; exclude them from society; confiscate their property; move them into ghettos; deport them, and exterminate them.
The first step toward achieving such a vision involved figuring out just how many people the Nazis needed to round up — in other words, conducting a census. Most advanced governments at the time used punched-card technology to do that, which is why IBM exists today.
IBM’s original incarnation was indeed born from the U.S. Census Bureau, which used a new electromechanical punched-card tabulator for its 1890 survey. This machine was the brainchild of 28-year-old American inventor Herman Hollerith, the son of a German immigrant.
Hollerith formulated the idea by watching train conductors try to catch passengers reusing someone else’s ticket. The conductors would record characteristics like height or hair colour by punching a ticket in a certain way, letting the next conductor to come along know if someone attempted to pull a fast one.
The young inventor combined that idea with a mechanised card reader whose physical springs would briefly cause an electrical connection when a punched hole appeared in a card. It was a rudimentary binary system that could sort and organise cards into piles, depending on which holes had been punched through.
Hollerith’s invention was a resounding success, and the machine reading industry was off to the races. Hollerith’s own company, Tabulating Machine Company, eventually consolidated with three others to form a new outfit that would soon call itself International Business Machines, IBM, in 1926 and hold a monopoly on this revolutionary punched-card system.
By the 1930s, the new Nazi government needed that technology — and recruited IBM for the job. Tabulating machines made tracking lines of Jewish descent possible, even if a German citizen’s family had married out of the religion or converted generations ago.
This transformed the way, scale and rate at which genocide could be waged. Of course, Adolf Hitler wasn’t the first political tyrant to engage in acts of genocide, but he was the first to do so with automation on his side. And with the demographic treasure trove collected in the 1933 census (and again in 1939), the Nazi government could work out who to target with more precision than ever.
By the time the Holocaust began in earnest in 1941, the Nazis tattooed concentration camp prisoners with identification numbers so that administrators could track that prisoner’s punch card throughout the system.
IBM’s machines were perfect for this, and for tracking the train traffic coming into the concentration camps. Indeed, the Nazis soon placed tabulating machines made by IBM’s German subsidiary, Dehomag, in every train depot and every concentration camp.
And throughout this entire era, IBM used foreign subsidiaries to funnel its international profits back to the U.S. Two of those subsidiaries — Dehomag and Poland’s Watson Business Machines — played a role in millions of deaths.
Watson, The Business-Minded Man
That Polish subsidiary was named after Thomas J. Watson, IBM’s chairman and CEO through its boom years in the first half of the 20th century. To this day, IBM loves Watson — so much so that the company even named its big-data, artificial intelligence computing system after him. He’s important to the company’s ethos, which is why it’s understandable that even today IBM takes offence at the idea that he would ever conspire with the Nazis, knowingly or not.
To understand the true extent to which Watson did or didn’t conspire with the Nazis, first try to imagine World War II without the aid of hindsight. In the late-1930s, many American companies — including Ford, General Motors and IBM — kept their German businesses alive through backdoor deals and Swiss bank accounts. Likewise, IBM offered its punched card technology to an array of actors, including the United States.
Things changed in 1938, when Kristallnacht — an event wherein roving gangs of white supremacists torched over 1,000 synagogues and destroyed over 7,000 Jewish businesses in Germany — transpired and marked a turning point in the war. This year likewise signalled the official cut-off for trade between IBM and German subsidiary Dehomag, though IBM retained majority ownership of Dehomag until 1940, according to Kevin Maney’s book, The Maverick and His Machine.
Germany was IBM’s second-largest market, and IBM did not want to lose that business. It would have taken courage — or pending your views, folly — to destroy a huge part of its business. That’s why in many of his late 1930s letters, Watson framed things as a business problem: How would IBM save its stake in Dehomag? And, should they lose that stake, wouldn’t it in some ways be worse to allow the Nazis to open up a competitor?
It remains unclear to what extent Watson, who in 1937 accepted an Order of the German Eagle medal from the Nazi government, engaged with the Nazis following the official 1938 cut-off. Some allege that Watson dragged his feet in severing business relations with the Nazis, whereas IBM says his work with the Nazi government ended in 1938.
Watson’s letters from the time period help illuminate the morass in which he found himself, and why he may have been sluggish in cutting off ties with Germany.
Every decoration which I have received has been given me in recognition of my efforts toward developing world peace through world trade . . . I might add that on my trip last year, in addition to Germany, I was decorated by Sweden, Yugoslavia, Belgium, and France . . . I am an internationalist. I cooperate with all forms of government, regardless of whether I can subscribe to all of their principles or not . . . As to my feeling in regard to the Jewish race, it is well known throughout the world that I have always put forth my best efforts to assist them in every way . . . I do not feel that it is necessary for me to answer any question as to whether I am in sympathy with the movement against the Jews, because what I have been doing for the Jews is so well known and furthermore, no real American could subscribe to any principles of government that discriminate against race or religion.
Soon enough, however, public backlash incentivised Watson to break ties with the Nazis. In 1940 — after Jewish-American leaders had pulled out of IBM events, acquaintances had written strongly-worded letters, and Watson’s own son had joined the Army National Guard — he finally returned the medal.
Still, that only paints part of the picture. Just as business informed IBM’s decision to work with the Nazis, it may have also informed its decision to relinquish its holdings in Dehomag. By 1940, IBM thought that the war had made Dehomag a lost cause. As a consequence, the company considered whether it would be better off giving up its majority stake in Dehomag in hopes of preserving the entity’s health and recouping it once the war ended.
Even when the company decided to relinquish holdings in Dehomag, the question of how to get their money back remained. IBM had invested a significant amount of money into Dehomag early in the 1930s, meaning Dehomag was indebted to IBM. Until 1938, when relations officially ended, the money made on every product that Dehomag shipped out to IBM’s other European subsidiaries helped Dehomag pay off its debt to IBM.
In other words, whatever else the Nazis were doing, IBM was trying to get as much money as they could out of Germany.
In response to all this, IBM recently gave the following statement to ATI:
The company has never been silent on this issue. As with other foreign owned companies that did business in Germany at that time, IBM’s German operations came under the control of Nazi authorities prior to and during World War II. Most documents were destroyed or lost during the war.
Whatever archives IBM had from this period were donated to universities in New York and Germany several years ago for scholarly review. IBM and its employees around the world maintain that the atrocities committed by the Nazi regime are abhorrent and condemn any actions which aided their unspeakable acts.
That is one of the first statements IBM has made on the matter since the company published a pair of press releases 15 years ago in response to the 2001 release of Edwin Black’s book, IBM and the Holocaust.
Black, whose parents are both Holocaust survivors, has investigated IBM and its role in the Holocaust since he laid eyes on a Dehomag machine while visiting a Holocaust museum in 1993. To this day, he is a strong critic of IBM’s involvement in the Holocaust. And in 2012, he issued a second edition of his book containing newly-discovered documentation.
IBM and the Holocaust
In contrast to IBM’s narrative, Edwin Black’s book casts a more critical eye toward Watson’s actions in the years leading up to World War II.
That story begins two months after Hitler became Germany’s chancellor in January 1933, at which point he established the first concentration camp for political prisoners. By the next month, 60,000 were imprisoned.
This is when the German government revealed its plan to hold a long-delayed national census. This type of business was IBM’s bread and butter and Dehomag, the German subsidiary, was first in line for the job. IBM thus boosted its investment in Dehomag almost 20-fold, with that money largely going toward building IBM’s first factory in Germany.
According to Black, the Nazi government then used the equipment and training IBM had invested in the German market to identify so-called undesirables. After the Nazis completed the census, they discovered that two million people of Jewish descent lived in Germany — not half a million, as they’d previously thought.
As the Nazis began taking action against them, public calls for the U.S.’ economic boycott of Germany commenced. However, according to Black at least, IBM ignored the outcry. In fact, the person in charge of Dehomag — Willy Heidinger — was an outright Nazi supporter, thus making Dehomag friendly to the regime. Black contends that as it became increasingly difficult to conduct business in Nazi Germany, Watson and Heidinger made a secret deal to use Heidinger and Dehomag’s clout with the Nazis to supply punched-card technology to IBM customers in territories that had recently come under Nazi control.
Bolstering this theory, in the 2012 reissue Black presents a letter dated 1941 from IBM that directed a Dutch subsidiary to work with Dehomag — years after business with Germany was supposed to have ceased. Furthermore, according to Black’s 2012 evidence, Watson took a one percent commission on all profits made in business with the Nazis, and had to personally approve all expenditures on said business, such as bomb-fortifying Dehomag installations.
The most damning of Black’s new evidence, however, is likely two U.S. government memos. The first is a Justice Department memo written during a federal investigation into IBM’s collaboration with the Nazis. In that memo, Economic Warfare Section Chief Investigator Howard J. Carter wrote, “What Hitler has done to us through his economic warfare, one of our own American corporations has also done . . . Hence IBM is in a class with the Nazis . . . The entire world citizenry is hampered by an international monster.”
The second memo, dated four days before Pearl Harbor, comes from the State Department. IBM’s top attorney, Harrison Chauncey, had visited the State Department to discuss IBM’s involvement with the Nazis. The memo read that Chauncey expressed anxiety “that his company may some day be blamed for cooperating with the Germans.”
Given the case Black makes against IBM, his book has faced rather critical reception. When it first came out, for example, Bloomberg Business week and The New York Times skewered it, citing faulty research methodology and bombastic hyperbole.
In response, Black simply directed ATI to a page on his website that lists the various media outlets that have criticized his book but later published retractions. Elsewhere Black has publicly stated that criticism comes from dislike of his person, not what appears in his work.
Indeed, as Mic puts it:
“Despite Black’s firebrand ethos, his meticulous research has uncovered tens of thousands of documents, culled together from across Europe, that carefully show how IBM didn’t just provide technology to Hitler’s Germany — it helped implement and maintain it for whatever purposes the Nazis required.”
In fact, Newsweek, The Sunday Times, and The Washington Post all gave Black’s book positive reviews.
Whatever your take on the book, it’s clear that Black indeed conducted copious research through scores of documents that the rest of the world has simply ignored. Even New York University and the University of Stuttgart, the two institutions to which IBM sent their World War II-era documents, haven’t given that evidence a close look.
When ATI reached out to both institutions and asked to be put in touch with an expert who had studied the files, Stuggart responded by saying that the files likely didn’t exist in their archives, while NYU said that they’ve acted only as a repository for the documents — and that much of the collection relates to IBM’s subsequent efforts to regain shareholder control of its German subsidiaries and machines after Allied victory.
As NYU states, we shouldn’t forget that even after the Holocaust shocked the world, IBM sought to regain control of its interests in Germany. Clearly, no matter what the circumstances, this company always had its eye on the prize, and knew precisely what it was doing. That’s why it’s hard to believe that, when it comes to doing business with the Nazis, IBM wasn’t aware of what it was doing in every sense.
And in the early 2000s, some people wanted to call IBM on it. In 2001 and 2004, victims of Nazi persecution filed two class-action lawsuits against IBM. In 2006, a Swiss court deemed the statute of limitations to have expired and dismissed the 2004 case, while the 2001 case disappeared when the plaintiffs’ lawyers withdrew it the same year. In that case, the decision to withdraw came after several German companies that had contributed to a Holocaust victims reparations fund threatened to stop donating unless any and all legal action was off the table. Not wanting to shortchange that fund, the lawyers withdrew the case.
Ultimately, IBM Germany did agree to donate $3 million to that Holocaust fund — with the clear stipulation that the contribution was not an admission of liability.