A diplomat’s son who wanted to farm
Henry Morgenthau Jr. was born in New York City on May 11, 1891, into one of the city’s most prominent German-Jewish families. His father, Henry Morgenthau Sr., had arrived from Germany as a boy, grown rich in New York real estate and would become Woodrow Wilson’s ambassador to the Ottoman Empire; his mother, Josephine Sykes, was also of German-Jewish descent. The younger Henry grew up among wealth and expectations, attending Phillips Exeter Academy and the Dwight School.
He was not a natural student. He never earned a high-school diploma and twice left Cornell University without a degree, studying architecture and then agriculture. What drew him was the land. In 1913 he bought a farm at Hopewell Junction in Dutchess County, New York, which became Fishkill Farms, and which still belongs to the Morgenthau family. All his life he insisted on describing his occupation as “farmer” even on his passport and tax forms.
The Roosevelts’ neighbour
Also in 1913 he met Franklin and Eleanor Roosevelt, whose Hyde Park estate lay nearby. It was the start of one of the closest friendships in American political history. In 1916 Morgenthau married Elinor Fatman, a granddaughter of Mayer Lehman, co-founder of Lehman Brothers. The couple had three children: Henry III, Robert and Joan.
In 1922 Morgenthau took over the farm journal American Agriculturist, which gave him a platform on rural issues. When Roosevelt became governor of New York in 1929, he appointed his friend to the state’s Agricultural Advisory Committee and Conservation Commission. Morgenthau was not a political operator; his strength was loyalty, energy and a reputation for honesty, and Roosevelt trusted him completely.
Secretary of the Treasury
When Roosevelt entered the White House in 1933, Morgenthau went with him, first to head the Farm Credit Administration and then, from November 1933, as acting and under secretary of the Treasury. On January 1, 1934, he became Secretary of the Treasury, a post he would hold for more than eleven years, a remarkable position for a Jew at a time of widespread antisemitism in American public life.
He was at the centre of New Deal finance. He managed the government’s gold policy, recording in his diary Roosevelt’s whimsical choice of a gold-price increase because it was “three times seven.” He helped set up the Works Progress Administration and the Public Works of Art Project, which employed artists during the Depression. Morgenthau insisted that the new Social Security system be funded by payroll taxes on workers, and the original law excluded farm workers and domestic servants. His agents also pursued organised crime and political corruption, helping bring down Kansas City’s boss Tom Pendergast.
Fiscally, he was a conservative among New Dealers. In 1937 he persuaded Roosevelt to pursue a balanced budget; the resulting cuts are blamed by many Keynesian economists for contributing to the sharp recession of 1937–1938.
Paying for the war
As war approached, Morgenthau was among the earliest members of the cabinet to urge help for the democracies. In 1939 he set up a Treasury procurement service to help Britain and France buy American munitions.
Once the United States entered the war, his great task was to pay for it. He built a nationwide marketing system for war bonds, aimed at ordinary Americans as well as financial institutions, while the Federal Reserve agreed to support Treasury borrowing. Bond sales reached about a billion dollars in 1942 alone, and the War Bond programme as a whole raised some $49 billion towards the cost of the war, turning millions of citizens into stakeholders in victory.
The rescue of the Jews
Morgenthau came from an assimilated German-Jewish family, and his public career had been built on farm policy and finance rather than Jewish affairs. The Holocaust changed that. In 1943 his Treasury staff discovered that officials of the State Department had delayed a license for the World Jewish Congress to fund the evacuation of Jews from Romania and France, and had instructed diplomatic missions to stop forwarding information about Nazi atrocities.
A young Treasury lawyer, Josiah E. DuBois Jr., drafted a devastating memorandum titled “Report to the Secretary on the Acquiescence of This Government in the Murder of the Jews” signed and forwarded by the general counsel, Randolph Paul. On Sunday, January 16, 1944, Morgenthau, Paul and John Pehle took the case directly to Roosevelt at the White House. Six days later, on January 22, Roosevelt signed Executive Order 9417 creating the War Refugee Board, charged with the immediate rescue and relief of the Jews of Europe and other victims of persecution.
With Pehle as its first director, the board worked with Jewish organisations, neutral diplomats and resistance groups. It helped sponsor Raoul Wallenberg’s mission to Budapest, brought 982 refugees to a shelter at Fort Ontario in Oswego, New York, and released the first detailed reports of Auschwitz to the American public. Pehle himself later called its work “little and late” against the scale of the catastrophe; but historians credit it with saving tens of thousands of lives, and the historian David Wyman estimated as many as 200,000. The board was small, its staff was limited to thirty, though with seconded officials some seventy people were working for it by the summer of 1944, and much of its rescue money came from private Jewish organisations: about $15 million was made available through Treasury licenses. It was wound up by President Truman’s Executive Order 9614 on September 15, 1945.
Bretton Woods and the Morgenthau Plan
In July 1944 Morgenthau presided over the United Nations Monetary and Financial Conference at Bretton Woods, New Hampshire, which created the International Monetary Fund and the International Bank for Reconstruction and Development, later the World Bank, and pegged the world’s currencies to the dollar and the dollar to gold. The system shaped the global economy for a generation, and its two institutions remain central to it today.
That same year he proposed the plan that bears his name: to prevent Germany from ever waging war again by stripping it of heavy industry, including the Ruhr, and turning it into a largely agricultural country. Roosevelt and Churchill initialled a version at the Second Quebec Conference on September 16, 1944. Secretary of War Henry Stimson opposed it, and when it leaked it drew fierce public criticism. Roosevelt’s son-in-law John Boettiger complained that it was worth thirty divisions to the Germans, and Nazi propaganda did seize on it: Joseph Goebbels warned Germans that the Allies meant to turn their country into a “potato field.” Roosevelt soon distanced himself from the plan, though its spirit influenced the early occupation directive JCS 1067. The plan remains the most controversial part of Morgenthau’s legacy.
Resignation
After Roosevelt’s death in April 1945, Morgenthau’s position weakened quickly. Briefly, between June 27 and July 3, 1945, he stood next in the line of succession to the presidency, the only Jew ever to do so. When he demanded to accompany President Harry Truman to the Potsdam Conference and threatened to resign if he was refused, Truman accepted his resignation at once. He left office on July 22, 1945. Truman was reported to have remarked privately that he would not take “Jew boys” to Potsdam. The episode closed Morgenthau’s public career.
Building Israel and final years
Out of office, Morgenthau gave much of his remaining energy to the Jewish people. From 1947 to 1950 he was chairman of the United Jewish Appeal, which raised some $465 million in that period for refugees and the new State of Israel. From 1951 to 1954 he chaired the board of governors of the American Financial and Development Corporation for Israel, which handled a $500 million bond issue for the young state, and he served as a financial adviser to Israel. The moshav Tal Shahar, founded in 1948, was named in his honour.
Elinor Morgenthau died in 1949, and in 1951 he married Marcelle Puthon Hirsch. He donated his vast diary, some 840 volumes, to the Franklin D. Roosevelt Presidential Library, where it remains one of the richest sources on the New Deal and the war. He died of heart and kidney failure at Vassar Brothers Hospital in Poughkeepsie, New York, on February 6, 1967, aged seventy-five.
Legacy
Morgenthau’s legacy is varied. He was the steady manager of American finance through the Depression and the most expensive war in history, and a founding father of the post-war economic order. He was also the author of a punitive plan for Germany that was abandoned and used by the enemy as propaganda.
To Jewish history, he is the cabinet officer who refused to accept his government’s indifference to genocide. At a moment when rescue was politically unpopular, he took the evidence to the President and won the creation of the only American agency devoted to saving Europe’s Jews. His son Robert M. Morgenthau went on to serve for decades as Manhattan District Attorney, carrying the family’s commitment into another generation.
Sources & further reading
Henry Morgenthau Jr., Wikipedia · Henry Morgenthau, Jr. (1934–1945), U.S. Department of the Treasury · Henry Morgenthau Jr., Jewish Virtual Library · The War Refugee Board, USHMM Holocaust Encyclopedia · War Refugee Board, Wikipedia · Researched from the sources above and checked against them. Spotted an error? Tell us.
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