Evening star., 1940-06-16
Fate Of y. S. Stake in Europe
Highly Uncertain if Nazis Win
Xictors Might Be Not Too Harsh With American
Investments, but Evidence to Date
Is Not Reassuring
By OHver Mckee.

ny NItCc
If the axis powers score a knockout
victory over the Allies and establish
themselves as the overlords of Europe.
what will happen to American invest
ments in the conquered territory? Will
American investors face a confscation
of their property, and be deprived of
future profits from the enterprises in
which they have placed their money?
AS the Nazi war machine carries it's Of
fensive into the heart of France, and as
Great Britain prepares for an invasion,
these questions are on the tongues of
administration officials.
American direct investments in Europe
total more than S1,25O 100000 according
to Commerce Department estimates.
The enterprises in which Americans have
invested their money cover wide range;
from automobile factories to chain and
retail stores. After the seizure of AUS
tria and Czecho- -Slovakia and the con-
quest of Poland, the Nazis occupied
Norway, Denmark Holland and Bel
GUM, and their armies have now cap
tured Paris. If Germany and Italy
bring the Allies to their knees, virtually
all Western Europe, from the Baltic to
the Iberian Peninsula, will come under
the domination of the totalitarian pow
ers, a domination that is likely to in
clude the United Kingdom, even if the
British Isles escape a physical conquest.
The present war is the beginning of
"a o1ic i,, rJe
that found an appropriate echo last
week at Rome as II Duce joined his axis
partner. If the totalitarian powers auo-
jugate the free nations of Europe, and
force them to accept their economic and
political controls, it will mean the vir-
tual end, in Europe, of the system of pri-
vate capital. In Germany and Italy the
state is supreme, and the government
controls industrial production, wages,
distribution and foreign trade National
Socialism and it's controlled economy
have little place for private capital and
free enterprise
Returns to L. S. Scant
Since the outbreak of the war nine
months ago. Americans have received
scant returns from money invested in
industrial and other enterprises in Ger
many.
General Motors Corp. has large auto
mobile plant in Germany, the Adam
Opel Aktiengesellschaft. "As a result
of the declaration of war, and in line
with the corporations operating policies,
with full recognition of the responsibility
that the manufacturing facilities of
Adam Opel A. G. must now assume un-
der war regime, the corporation has
withdrawn the American personnel for
merly in executive charge of operation,
and has turned the administrative re-
sponslbility over to German nationals"
said the annual report of General Motors
Tor the year ending December 81, 1885,
Its relationship is now limited to rep
resentation on the board of directors"
Profits realized abroad last year, but
not reflected in earnings because of ex-
change restrictions. amounted to S29,-
983,555, equivalent to 56 cents per share
OF the conlpany's common stock, the
report further revealed. Of this total,
profits of the German subsidiary ac-
counted for Sl6,436325, equivalent to 38
cents per common share The experience
of other American firms in Germany,
since the war, is believed to be much
the same. For practical purposes. these
enterprises are now part of the Naz
economic machine. and if the books
show a profit, American investors, for
the present, seem to have little chance
of securing their share in them by the
transfer OF funds to this country.
Writing OFF the Losses.
In Austria, Czecho-Slovakia and Po-
land, direct American investments to-
tailed many millions of dollars. Since
the Nazi occupation there has been little,
II any, return to American investors
from branch plants and other estab-
hshments in these countries In its
annual report for the calendar wear
1889, the Colgate Palmolive-Pee Co.
announced that the exact status of its
Polish subsidiary was unknown. Sig
nif1cantly, however. the company
promptly reduced from S657l4 to 81 the
book value CT the investment in its Polish
subsidiary. Gone with the blitzkrieg!
Other American dollars, no doubt, have
similarly disappeared.
At the outbreak of the war the United
States had substantial direct invest
ments in Holland, Belgium, Norway and
Denmark Though Government officials
have received scant information since
their conquest, there is no reason to be-
heVe that American investors will fare
any better than they have in Poland and
Czecho-Slovakia. American companies
had large stocks of oil in all four coun-
tries The Nazis, it is believed. have
taken over these stocks, a welcome ad-
dltion to Germany's depleted oil re-
serves.
About half billion dollars of Ameri-