Henry Morgenthau

born may 11, 1891 new york, new york

died february 6, 1967 poughkeepsie, new york

secretary of the treasury

"[A]lthough obviously bright, the boy [Morgenthau] suffered from what today would be called a learning disability.… Despite hard work, the boy developed an aversion to conventional schooling."

henry morgenthau iii, in the 1991 book mostly morgenthaus: a family history

Though a poor student throughout his school career and very awkward during public appearances later in life, Henry Morgenthau Jr. served as secretary of the treasury for eleven years during some of the most challenging economic times in U.S. history. From 1934 to 1940 he tried to maintain a stable monetary system in the face of the Great Depression, the worst economic crisis the United States had ever experienced. In the early 1940s Morgenthau was in charge of financing the massive U.S. war effort during World War II (1939–45). Throughout this time he remained sensitive to the hardships of poor Americans and was dedicated to easing the suffering of those in need.

Challenging early years

Henry Morgenthau Jr. was born in May 1891 to Henry Morgenthau Sr. and Josephine "Josie" Sykes. The third of four children, he was the only son. The family resided in a New York apartment at Central Park West and Eighty-first Street. Henry Sr.'s father, Lazarus Morgenthau, had immigrated from Germany to the United States when Henry Sr. was ten years of age. Henry Sr. became a lawyer who made a fortune in real estate transactions in Harlem and the Bronx. He and Josie were active in the Democratic Party and supported a variety of social welfare causes.

Henry Sr. took great interest in his only son and established a very close relationship with him. Young Henry Jr. was outgoing and fun-loving. When he reached school age, it soon became apparent that he had a significant learning disability. Henry did poorly in every level of school and was miserable in the academic environment. Learning language skills and math proved quite difficult for him. On the other hand, apart from his school subjects, he was very bright and had a strong imagination. Following kindergarten Henry went into the Sachs Collegiate Institute, then to New Hampshire's Phillips Exeter Academy, and back to Sachs by 1906. At that time he received tutoring from Prussian instructor Otto Koenig. Through the tutor's assistance, Henry graduated from high school and entered Cornell University to major in architecture. Henry Sr. wanted his son to join his real estate business as an architect. However, despite the availability of a personal tutor, Henry Jr. was unsuccessful in the college classroom and left Cornell in the spring of 1911.

Henry got a job as a timekeeper for a construction company, but his father had other ideas. Henry Sr. and Josie had been involved in an organization providing social services for the needy in Manhattan's Lower East Side. It was called the Henry Street Settlement House. They encouraged Henry Jr. to serve as a volunteer there. The Henry Street House in particular aided impoverished Jewish immigrants from Poland and Russia. Settlement houses in the late nineteenth and early twentieth century frequently served as a training ground for individuals who would later become social workers or pursue public careers. Henry spent the summer of 1911 at the Henry Street House. The dire poverty of the people there made a lasting impression on him.

A New York farmer

In the fall of 1911, after only a few days of working as a laborer at the Underwood Typewriter Company in Hartford, Connecticut, Morgenthau became seriously ill with typhoid fever. When he was well enough, his father sent him to a Texas ranch to complete his recovery. The experience changed Henry's life: He decided to become a farmer. Morgenthau returned to Cornell to major in agriculture. He completed his studies in 1913 at age twenty-two (though he did not receive a degree) and purchased a 1,700-acre farm in Dutchess County near the town of Poughkeepsie, New York. Morgenthau grew apples and maintained a dairy. Although comfortably at home on his farm, he retained a circle of personal friends who had connections to wealth and influence. One acquaintance was young Franklin D. Roosevelt (1882–1945; served 1933–45; see entry), the future president. Henry Jr. married Elinor Fatman, known as Ellie, in April 1916. He and Ellie had known each other for years. She, too, had volunteered at the Henry Street House before finishing her college education in 1913. Ellie gave birth to a son in January 1917, and the couple would have two more children.

When Roosevelt was struck with polio in 1921, Morgenthau spent many hours with him during his initial recovery, endlessly discussing issues of the day and playing board games. Also during this time Morgenthau purchased the farm journal American Agriculturist, to pursue his interest in agricultural science. Through the magazine he promoted soil conservation and application of new scientific advances in agriculture.

As Roosevelt began to resume his political activity, Morgenthau served as his driver and personal assistant. Upon winning the New York governor's election in 1928, Roosevelt appointed Morgenthau chairman of the state's Agricultural Advisory Commission. In 1930 after his reelection as governor, Roosevelt appointed Morgenthau the state commissioner of conservation, placing him in charge of New York's $2 billion reforestation program. The program provided jobs for thousands of the state's workers during the early Depression years, and they planted nearly ninety million trees.

Head of finance

Morgenthau followed Roosevelt to Washington, D.C., after Roosevelt's successful presidential campaign in 1932. Morgenthau had privately hoped to become secretary of agriculture, but in March 1933 Roosevelt appointed him head of the Farm Credit Administration (FCA). Morgenthau was responsible for consolidating the programs of nine existing farm loan agencies into one agency. Eventually the FCA was loaning a million dollars a day to farmers to help them meet their mortgage payments and avoid bankruptcy.

Before long an opportunity for a cabinet appointment did arise for Morgenthau. In November 1933 Secretary of the Treasury William Woodin was in failing health, and he submitted his resignation to Roosevelt. The president appointed Morgenthau as Woodin's replacement on January 1, 1934. He would remain secretary of the treasury for the next eleven years. Many thought Morgenthau an odd choice for the position. He had little background in finance and often came across very poorly in public appearances, such as at press conferences. He always appeared shy and ill at ease. Nonetheless, Morgenthau maintained a close relationship with Roosevelt, lunching with the president every Monday, much to the envy of others.

As secretary of the treasury during the Depression years, Morgenthau spent most of his energy ensuring a stable U.S. dollar. By the end of the 1930s U.S. currency was the strongest in the world. Morgenthau's job became increasingly complex as the federal budget dramatically increased. From 1934 to 1945 the annual federal expenditures rose from $5 billion to $98 billion. Some problems did occur along the way: Morgenthau had long sought a balanced federal budget (in which the government spends no more money each year than it receives in revenue). In early 1937, with the nation's economy seemingly on better footing, Morgenthau finally convinced Roosevelt to cut back federal expenditures on relief programs. However, the economy soon went into a steep decline, and many thought the decreased federal funding was a key contributing factor. Morgenthau fought to maintain the balanced budget, but others convinced Roosevelt to increase federal spending once again.

As war spread across Europe from 1939 to 1941, Morgenthau called for U.S. support of Britain's war effort against Germany. He drafted the Lend-Lease Act, creating a major program for supplying Britain with war materials. He also helped create the War Refugee Board to assist Jews and other refugees arriving from Europe. With the U.S. entry into the

Farm Credit Administration

Henry Morgenthau's keen interest in agriculture prior to 1933 was clear; he operated a farm and published an agricultural magazine. Accordingly, newly elected president Franklin D. Roosevelt appointed his good friend head of the Farm Credit Administration (FCA). The nation's farm economy had struggled throughout the 1920s. The international demand for U.S. produce dropped significantly following World War I (1914–18) and stayed down. Economic conditions grew even worse with the beginning of the Great Depression in late 1929. During the 1920s and early 1930s Congress passed several pieces of legislation making loans more readily available to farmers so they could stay in business. However, by early 1933 farm prices remained low, and farmers continued to struggle. In addition, the large number of federal agencies making farm loans caused much confusion and inefficiency. These agencies included the Federal Farm Board, the Federal Farm Loan Board, the Reconstruction Finance Corporation, the Department of Agriculture, and various federal banks.

To pump more money into the nation's farm economy and better organize services to farmers, Roosevelt signed an executive order on March 27, 1933, creating the Farm Credit Administration, an independent federal agency. It was Morgenthau's responsibility to consolidate all the various farm loan programs into one. Congress passed the Farm Credit Act on June 16, making the FCA permanent. Congress next passed the Farm Mortgage Refinancing Act in January 1934, establishing the Federal Farm Mortgage Corporation, known as Farmer Mac, under the FCA with $2 billion in funds. The number of loans the FCA processed was staggering—three hundred loans a day at its peak. Over 20 percent of U.S. farms had been refinanced through FCA loans by late 1934. By 1941 the FCA had loaned almost $7 billion and saved thousands of farmers from bankruptcy. In the twenty-first century the FCA remains responsible for regulating the various banks and associations that make up the U.S. farm loan system.

war in December 1941, Morgenthau became responsible for financing the massive U.S. war effort. Morgenthau was also a leading figure in planning the postwar international monetary system. At an international conference attended by forty-four nations in July 1944 at Bretton Woods, New Hampshire, Morgenthau led in creating the International Monetary Fund and the World Bank. The two international financial organizations were established to help stabilize national currencies and provide funds to underdeveloped nations.

In regard to postwar Germany, Morgenthau promoted a controversial plan to dismantle German industries and divide the nation into two agricultural countries. However, in early 1945 Roosevelt decided on a different plan, which called for Germany to be rebuilt and maintained as a key part of the European economy. Three months after President Roosevelt's sudden death in April 1945, Morgenthau turned in his resignation because he did not have a good working relationship with the new president, Harry Truman (1884–1972; served 1945–53).

An advocate for Jews

After leaving public office, Morgenthau became heavily involved in Jewish causes. He served as general chairman of the United Jewish Appeal (UJA) from 1947 to 1955. The UJA is an international organization created to support Jewish communities throughout the world and to care for those in need. From 1951 to 1954 Morgenthau was also chairman of the board of governors for the American Financial and Development Corporation for Israel. The corporation assisted Israel, the newly established Middle Eastern state, in its efforts to become economically stable.

In 1949 Morgenthau's wife, Elinor, died. In November 1951 he married Marcelle Puthon Hirsch. Morgenthau lived for over a decade in retirement before dying of a heart and kidney condition in February 1967. He was seventy-five. An incredible volume of materials from Morgenthau's tenure as secretary of the treasury has survived, providing insight into behind-the-scenes debates over U.S. policy during critical times. Known as the Morgenthau diaries, the materials amount to eight hundred volumes and are housed in the Franklin D. Roosevelt Library in Hyde Park, New York. Three volumes covering the years 1959 to 1967 were published in From the Morgenthau Diaries by John M. Blum.

For More Information

blum, john m. from the morgenthau diaries. boston, ma: houghton mifflin, 1959–67.

blum, john m. roosevelt and morgenthau. boston, ma: houghton mifflin, 1970.

kesaris, paul, ed. the presidential diaries of henry morgenthau, jr. frederick, md: university publications of america, 1981.

morgenthau, henry, iii. mostly morgenthaus: a family history. new york, ny: ticknor & fields, 1991.

Morgenthau, Henry

[MAY 11, 1891–FEBRUARY 6, 1967]

Author of a plan to rebuild post–World War II Europe

Henry Morgenthau served as secretary of the treasury in Franklin D. Roosevelt's administration from January 1, 1934, until July 22, 1945. Born in New York City into a German Jewish family, Morgenthau was a friend and a neighbor of Roosevelt in Hyde Park, New York. During the final months of the war, Morgenthau became a catalyst for the U.S. plan on punishing German war criminals that—although very different from what he had envisioned—was to become the core of the Nuremberg Charter.

Morgenthau's involvement in the question of punishing war criminals was a by-product of his deep interest in the overall question of the treatment of Germany after the war. Disturbed by the U.S. Army's Handbook for Military Government in Germany and other policy papers on the issue, Morgenthau succeeded in winning the president's support for a comprehensive memorandum, entitled Program to Prevent Germany from Starting a World War III, which he presented to Roosevelt on September 5, 1944. The Morgenthau Plan, as it became known, had two major themes: the complete demilitarization and deindustrialization of Germany, and the severe punishment of all Germans involved in perpetrating war crimes. Morgenthau did not try to hide his prime motive—to eliminate once and for all Germany's threat to world peace, and to take revenge for the atrocities Germany committed during World War II.

Morgenthau's stand on punishing suspected war criminals corresponded with his overall view favoring the harsh treatment of Germans. The treasury secretary suggested the preparation of a list of arch-criminals whose guilt had generally been recognized by the United Nations (UN). Anyone on the list who was apprehended and identified by military authorities would be executed by firing squads made up by United Nations soldiers. Morgenthau also suggested establishing military commissions to deal with crimes that had been committed "against civilization during this war." In this category he included the killing of hostages and execution of victims because of their nationality, race, creed, color, or political conviction. Morgenthau advocated that any person convicted by such a military commission "be sentenced to death, unless the military commissions, in exceptional cases, determine that there are extenuating circumstances, in which case other punishment may be meted out, including deportation to a penal colony outside of Germany. Upon conviction, the sentence shall be carried out immediately." In this respect, Morgenthau's Plan much resembled the suggestions Britain's Prime Minister Winston Churchill had made to the British War Cabinet in late 1943 in anticipation of the war's end.

Fearing that Allied military authorities would be unable to tackle the enormous number of cases of war criminals, Morgenthau called for the detention, until the extent of their guilt had been determined, of all surviving members of the SS and Gestapo; high-ranking officials of the police, SA, and other security organizations; high-ranking government and Nazi Party officials; and all leading public figures closely identified with Nazism.

Morgenthau's Plan was vehemently opposed by U.S. Secretary of War Henry L. Stimson, who argued that in the long run it would prevent the achievement of world peace. Stimson also strongly disapproved of Morgenthau's proposals about the treatment of war criminals for their failure to include at least the rudimentary aspects of the Bill of Rights, namely, notifying the accused of the charge, giving them the right to be heard, and within reasonable limits allowing them to call witnesses in their defense. Instead, Stimson envisaged an international tribunal to try the chief Nazi officials on the charge of committing offenses against the laws and rules of war, whereas those who had committed war crimes in Nazi-subjugated territories would be tried by military commissions of the countries involved.

The Stimson-Morgenthau collision over the question of the treatment of postwar Germany formed a watershed in Washington's handling of the war criminals problem. In spite of the fact that Morgenthau enjoyed the president's support as well as Churchill's in principle, Stimson won out by taking advantage of Roosevelt's political weakness prior to the elections of November 1944 and the press criticism of the Morgenthau Plan. The president was compelled to withdraw his backing for the summary execution of major criminals.

Morgenthau's involvement in the war criminals issue, however, did produce important achievements: First, it prompted the administration to finally take the problem seriously, and second, it led the United States to include within the rubric of "war crime" the notion of crimes the enemy had committed against its own nationals from 1933 on. The prevailing stand in Washington had been not to view as a war crime any massacre of Axis nationals. As late as September 1944 Stimson drew an analogy to lynching in a letter to Roosevelt, arguing that Allied courts would be in the same predicament that foreign courts would be if they attempted to prosecute lynching in the United States.

Stimson's eventual decision to include crimes against nationals of Axis countries in the War Department's plan to punish war criminals, which became the essence of the final U.S. plan, was more the result of political calculation rather than moral or legal considerations on his part, that is, to appease Morgenthau and to dispel accusations that he supported the soft treatment of Germany. In effect, Stimson was convinced that Morgenthau's position derived from the fact that he was Jewish. As of mid-1943 Morgenthau had demonstrated growing concern for the fate of Europe's Jews, and in early 1944 he played a significant role in galvanizing Roosevelt to seek a halt to the Nazis' ongoing extermination of the Jews. Roosevelt's executive order of January 22, 1944, establishing the War Refugee Board, which was mandated to take all measures within its power to rescue and assist the victims of enemy oppression, was the administration's main operative action on behalf of the Jews during World War II. After Roosevelt's death on April 12, 1945, Morgenthau's influence within the White House significantly diminished, and he resigned from President Harry S. Truman's administration in July 1945.

SEE ALSO Jackson, Robert; London Charter; Nuremberg Trials; United Nations War Crimes Commission; War Crimes

BIBLIOGRAPHY

Blum, John Morton (1970). Roosevelt and Morgenthau: A Revision and Condensation of Morgenthau's Diaries. Boston: Houghton Mifflin.

Kimball, Warren F. (1976). Swords or Ploughshares? The Morgenthau Plan for Defeated Nazi Germany, 1943–1946. Philadelphia: Lippincott.

Kochavi, Arieh J. (1998). Prelude to Nuremberg: Allied War Crimes Policy and the Question of Punishment. Chapel Hill: Univeristy of North Carolina Press.

Morgenthau, Henry, Jr. (1945). Germany Is Our Problem. New York: Harper.

Arieh Kochavi

Henry Morgenthau Jr.

Henry Morgenthau, Jr. (1891-1967), was secretary of the U.S. Treasury and a longtime confidant and adviser to President Franklin Roosevelt.

Henry Morgenthau, Jr., was born in New York City on May 11, 1891, into a prosperous family of German-Jewish ancestry. The senior Morgenthau, who had become wealthy through real estate investments, was active in Democratic party affairs and in sponsoring various social welfare projects in the city. Henry Morgenthau, Jr., attended Phillips Exeter Academy and then Sachs Collegiate Institute in New York City before entering Cornell University. Morgenthau left Cornell after three semesters to recuperate from typhoid fever. He again enrolled in Cornell, this time to study agriculture. But he soon left on a trip to the Pacific Coast to investigate different kinds of farming at firsthand. When he returned more excited than ever about a career in farming, his father bought several hundred acres for him in Dutchess County in upstate New York, which in succeeding decades became a highly successful and apple-growing farm.

Morgenthau and Roosevelt

Morgenthau's friendship with Franklin Roosevelt began in 1915, when Roosevelt, hosting Morgenthau at his neighboring Dutchess County estate at Hyde Park, tried unsuccessfully to persuade the young agriculturalist to run for sheriff. The next year Morgenthau married Elinor Fatman, whom he had known since childhood. The Morgenthaus had two sons and a daughter—Henry III, Robert, and Joan—all of whom became well known in their own right.

Morgenthau's first involvement in public service came during World War I, when he helped organize agricultural production in Dutchess County and persuaded U.S. Food Administrator Herbert Hoover to transfer 1,500 tractors to France. After the war Morgenthau became increasingly active in county and state Democratic party affairs and undertook publication of an agricultural weekly in which he championed such causes as soil conservation, rural electrification, and aid to rural education.

Morgenthau worked hard to elect Roosevelt governor of New York State. In 1929, after Roosevelt's victory, he went to Albany as a member of the state agricultural commission. Following Roosevelt's reelection in 1930, Morgenthau became conservation commissioner. With Harry Hopkins, Morgenthau devised a plan for combining reforestation projects with work relief for the jobless. This became a model of its kind as unemployment skyrocketed during the early years of the Great Depression. In 1932 Morgenthau again helped Roosevelt get elected, this time to the presidency, and again Roosevelt brought Morgenthau with him to the seat of government.

New Dealer

Morgenthau wanted very much to become secretary of agriculture, but he accepted appointment as head of the Farm Credit Administration, which handled most of the New Deal's efforts to aid debt-ridden farmers. During the year and a half he remained at Farm Credit, Federal loans to farmers increased more than 10-fold.

By November 1934, when Morgenthau became secretary of the treasury, the Roosevelt administration had shifted control of money and credit from New York and private financial combines to Washington and the federal government. Always close to Roosevelt, Morgenthau now became an even more central figure in the New Deal. Basically a fiscal conservative, Morgenthau nevertheless went along with mounting federal deficits as the Roosevelt administration struggled to meet the nation's relief needs and to revive the economy. In 1937, however, Morgenthau finally persuaded Roosevelt to make substantial reductions in federal spending, a move that helped trigger the "Roosevelt recession" of the late 1930s.

Wartime Spender

Morgenthau was an early and vigorous champion of collective security arrangements to resist the growing aggressiveness of Nazi Germany. After the outbreak of World War II in Europe in the fall of 1939, Morgenthau battled within the Roosevelt administration against neutralists and "America First" military strategists to clear British and French purchases of American-made war matérial and to step up military production, especially of airplanes. Until the establishment of the Lend-Lease Program in 1941, Morgenthau managed the bulk of American aid to Great Britain.

After Pearl Harbor and America's entrance into the war, Morgenthau administered the biggest and most rapid expansion of federal expenditures in the nation's history. By 1945 total federal outlays, which had been $7.1 billion during Morgenthau's first year at the Treasury, had reached $93.7 billion. Morgenthau's main contribution to the intensifying postwar planning debate within the Roosevelt administration was the much-criticized "Morgenthau Plan," which envisioned not only the disarmament of Germany but its deindustrialization as well. It was largely President Harry Truman's disapproval of the Morgenthau Plan that prompted Morgenthau's angry resignation in July 1945.

In retirement Morgenthau devoted much of his time to philanthropic projects. He was chairman of the United Jewish Appeal (1947-1950), and in the early 1950s he was chairman of the board of the American Financial and Development Corporation for Israel, which handled a $500 million Israeli bond issue. On Feb. 6, 1967, following a succession of heart attacks, Morgenthau died at Poughkeepsie, N.Y.

Further Reading

There is no full-scale biography of Morgenthau. The standard account of his public career is the massive, officially authorized narrative based on Morgenthau's papers by John Morton Blum, From the Morgenthau Diaries (3 vols., 1959-1965), which covers the period 1928-1945. Additional treatments of Morgenthau's role in the New Deal are in G. Griffith Johnson, Jr., The Treasury and Monetary Policy, 1933-1938 (1939); Allan S. Everest, Morgenthau, the New Deal, and Silver (1950); James MacGregor Burns, Roosevelt: The Lion and the Fox (1956); Arthur M. Schlesinger, Jr., The Age of Roosevelt (3 vols., 1957-1960); and Rexford Guy Tugwell, The Democratic Roosevelt (1957). Morgenthau's role in the formulation of the Lend-Lease Program is treated at length in Warren F. Kimball, The Most Unsordid Act: Lend-Lease, 1939-1941 (1969).

Additional Sources

Morgenthau, Henry, Mostly Morgenthaus: a family history, New York: Ticknor & Fields, 1991. □

Morgenthau, Henry, Jr. (1891–1967), secretary of the treasury, 1934–45.This former Dutchess County gentleman farmer and member of a prominent New York German Jewish family was a close personal friend and political confidant of President Franklin D. Roosevelt. Morgenthau was an important figure in the Roosevelt administration.

Responsible for U.S. financing of World War II, Morgenthau, as head of the Treasury Department, advocated relying on increases in the income tax to dampen inflationary pressures while raising revenue. Although he prevented a regressive national sales tax advocated by conservatives, Morgenthau faced a series of defeats in Congress over fiscal policies, especially on the income tax. He did, however, organize several highly publicized bond drives.

When the Roosevelt administration, especially the State Department, proved unresponsive to reports of systematic extermination of European Jewry by the Nazi regime of Adolf Hitler in 1940–43, Morgenthau and the Treasury Department proved to be one of the few federal agencies pressing for the United States to take decisive action against the Holocaust. On 16 January 1944, Morgenthau directly confronted Roosevelt with evidence of the Holocaust as well as the reluctance of the State Department to provide visas to Jewish refugees or facilitate rescue efforts by Jewish organizations in Europe. Shortly after this meeting, Roosevelt established the U.S. War Refugee Board by executive order. This body, with Morgenthau an active member, undertook a series of relief efforts, albeit limited, to aid Jewish refugees.

In 1944, Morgenthau—over the objections of the State and War Departments—forcefully advocated a harsh peace settlement. His plan called for stripping Germany of all heavy industry and partitioning the country into a series of demilitarized agricultural states. Attending the Quebec Conference in September 1944, Morgenthau prodded Roosevelt and Prime Minister Winston S. Churchill to initial a memorandum of agreement supporting his plan. This was later reversed by Roosevelt and his successor, Harry S. Truman, after intense lobbying by the State and War Departments, which denounced the plan as both unrealistic and detrimental to U.S. interests, given the need for a European counterweight to the expanded power of the Soviet Union.

Morgenthau proved more successful in shaping the postwar international monetary system. Relying heavily on expertise of Assistant Secretary of the Treasury Harry Dexter White, Morgenthau organized the Bretton Woods Conference of June–July 1944, which established the International Monetary Fund (IMF) and the International Bank for Reconstruction and Development.

Shortly after Truman assumed the presidency in April 1945, Morgenthau resigned as Treasury secretary. In retirement, he became an ardent supporter of the state of Israel and active in a number of Jewish philanthropic causes.
[See also Holocaust, U.S. War Effort and the; Public Financing and Budgeting for War; World War II: Domestic Course.]

Bibliography

John Morton Blum , From the Morgenthau Diaries, 3 vols., 1959–67.
David S. Wyman , The Abandonment of the Jews: America and the Holocaust, 1941–1945, 1984.
Henry Morgenthau III , Mostly Morgenthaus: A Family History, 1991.

G. Kurt Piehler