Spies at Work, Chapter 6: The Economic League goes to War
- 1 Introduction
- 2 Covert Operations in the 1930s
- 3 The "Anti-Fascist" Activities of the Economic League
- 4 Friends of Fascism
- 5 The Anglo-German Fellowship
- 6 "Dover-Nuremburg Return"
- 7 Anti-Semitism
- 8 "Section D" Revisited
- 9 Section D, Hitler and Churchill
- 10 Another Section D?
- 11 Section D, MI5 and the Economic League
- 12 The "National Defence Campaign"
- 13 The Political Warfare Executive
- 14 Conclusion
- 15 Notes and References
After the General Strike the League consolidated its organisation under the guidance of its youthful director, John Baker White. A pamphlet from 1933, outlining its "Aims and Methods and Achievements", shows that the League had continued to run its "open air meetings" and "study circles", produced a steady flow of leaflets and "Notes for Speakers", and had used the press to good effect. The League was, in this pamphlet, ahead of its time in recognising the role of public relations and news management:
- "In its work the League has never failed to realise the great value of the press as a medium for public education. In consequence it contributes letters and articles on economic questions to daily and weekly newspapers throughout the country."
The early 1930s were a time of massive unemployment; of riots and hunger marches. The Jarrow Crusade was just one of these marches, but it was by no means the largest or longest and it was certainly notable for the way in which it avoided political controversy and thus escaped violent opposition from police forces. Few of the hunger marches organised by the National Unemployed Workers Movement (NUWM) were so fortunate. The Economic League ran a vigorous campaign against the NUWM. The League sent "Flying Squads" of "Propaganda Vans", speakers and leafleters to towns and villages ahead of the marchers with the aim of encouraging or inciting an unsympathetic reception. The League's leaflets claimed that the NUWM was nothing more than a communist front and although its leader, Wal Hannington, was a member of the Communist Party, it would not have been accurate to describe it as an exclusively Communist movement any more than in 1978 the Anti-Nazi League was, after its first few weeks, an exclusively Socialist Workers Party organisation, or more recently the Anti Poll Tax Campaign was an exclusively Militant organisation. The fact that NUWM had identified and plugged a gap in the market place of political ideas and activity, thus drawing together many who did not and would never support the CPGB's political programme, did not concern the Economic League or its paymasters. Economic League leaflets were distributed ahead of the hunger marches, from vans emblazoned with the slogan "The Economic League Tells The Truth about Industry". One leaflet described the NUWM as "a purely Communist body" and continued:
- "Anybody who supports the "Hunger march" stunt, either by taking part in it, by attending the demonstrations arranged in connection with it, or by giving money to the March funds, is merely assisting a COMMUNIST PLOT to cause civil disorder...
- THINK THIS OVER AND DON'T BE DUPED BY THE REDS.
- N.U.W.M. stands for National Unemployed Workers Movement.
- It also stands for National Unemployed Workers Misguided and Misled.
- N.U.W.M. also stands for
- NO USE WASTING MONEY
- NO USE WALKING MILES"
Curiously, by the time the Economic League got round to writing its autobiography in 1969 it chose to forget about the depression, and its campaign against the unemployed. Just as it also had chosen to rewrite the history of its involvement with fascism.
Covert Operations in the 1930s
There are three well documented episodes during the 1930s which illustrate the degree to which the Economic League and the British Intelligence services were cooperating.
The "Invergordon Mutiny"
In September 1931 as a result of a long running dispute over pay, naval ratings in the Atlantic Fleet, based at the naval dockyards in Invergordon, refused to put to sea. The Admiralty tried unsuccessfully to suppress news about this Naval strike, but information began to leak out in the foreign press. But as a result it was presumed abroad that the secrecy meant that the strike was more serious than, in fact, it was. It quickly became known as "The Invergordon Mutiny" and though the strike lasted just two days, it was long enough to severely rattle the Admiralty. Naval Intelligence was convinced that the "mutiny" was the work of "communist agitators" and the Naval establishment was eager to find a explanation that did not point the finger at their own mismanagement of both the pay issue and the strike itself.
The ratings had returned to work after the Admiralty promised there would be no victimisation of the "mutineers". But within weeks of the strike, following a joint investigation by Naval Intelligence and MI5, more than two dozen ratings were discharged from the service. At the time, however, there had been no more than a handful of Communist Party members in the whole navy. One of those discharged men was Fred Copeman, who though not a Communist Party member at the time, did join the party a few years later. His story is told by historian Anthony Carew:
- "After being discharged he got a job as a rigger in London and became active in the National Unemployed Workers Movement. In May 1932 the right wing employers' organisation the Economic League wrote to the Admiralty pointing out their interest in countering subversive activities in Industry and asking for any information they could have about him. The Admiralty duly obliged with the information that he had been discharged, "services no longer required" and was understood to be acting as an agitator on behalf of the Communist Party. In fact at the time he was not a member of the Party, but lost his job on the suspicion." 
It had taken the Admiralty just seven days to reply to the League's letter. This confirms two things: that Copeman was being watched after his discharge and that the League was known to be a safe and reliable recipient of intelligence, in breach of the Official Secrets Act.
Another "Honours Scandal"
If the League had needed to explain its aims and objectives to Naval Intelligence, and it must be said that this is implausible, this was not so in the case of MI5. In the late 1920s a number of senior Conservatives and intelligence officers became concerned with the activities of a colourful and influential figure called Maundy Gregory. Gregory was accepting money from ambitious social climbers, often industrialists, in return for using his influence to fix them up with honours. Most, if not all, the payments to Gregory were channelled through the "National Publicity Agency", the liquor trade lobby run by Richard Kelly, who had helped Hall to run the League in its very first years. Gregory ran an exclusive dining-cum-night club called "The Ambassador". His list of influential friends included both General Horwood, the Metropolitan Police Commissioner, and Basil Thompson, the former head of the Directorate of Intelligence which General Horwood had earlier and successfully lobbied Lloyd George to close down.
It also included the Earl of Birkenhead, a cabinet minister and the most useful of Gregory's contacts when it came to the sale of honours. John Baker White also often dined at The Ambassador, and much later he told Gregory's biographer, Tom Cullen, that "The Ambassador Club became a favourite lunchtime rendezvous for members of Parliament". 
MI5 only became involved when Vernon Kell's second-in-command, Colonel O A Harker, was invited to lunch at The Ambassador. He was already aware of Gregory's reputation as a potential security risk and was horrified to find him dining alone with Birkenhead, with whom he was obviously a close friend. Harker began compiling a dossier on Gregory. When he became aware of the case of a midlands industrialist who had bought an honour which had not been forthcoming, he decided to act. The industrialist asked for a refund, which Gregory had refused in such a way as to leave himself open to a charge of blackmail. But since MI5 had no official constitutional position it could not bring a prosecution itself, and needed to persuade the Metropolitan Police Commissioner to do it for them.
Harker arranged for a meeting with Horwood, and also arranged to take with him, to support his case, John Baker White. White, Cullen writes, "... as director of the Economic League, had previously carried out his own investigation of Gregory at the request of some of the League members." Armed with his dossier, and with Baker White at his side, Harker was on his way to see Horwood when they met Gregory coming from the Commissioners office, looking pleased with himself. "That does it - there's no point in going up," White recalled him saying, and, "with that he tore the dossier into small pieces which he deposited in a rubbish bin as he went out. That was the end of the matter." Strictly speaking it was not the end of the matter.
Gregory was eventually, and discretely, prosecuted. Until the end of his life he was kept under the close and obsessive supervision of Richard Kelly. Fascinating as it is however, the strange tale of Maundy Gregory as told by Tom Cullen simply does not ring true. Why should anyone in the League want Gregory investigated? Are we to seriously believe that White was playing the honest broker in all this? Surely this was another "big lie" - to throw a smokescreen in front of a particularly disreputable piece of what would be today called "damage limitation". Certainly that would appear to be suggested by Kelly's involvement in the affair. Without more information it is impossible to do more than question the account given by Cullen and to suggest that it is a strange story that in reality was even stranger. On the other hand it is further evidence of the close, but ambiguous, relationship between the Economic League and MI5.
The Economic League vs. The Daily Worker
In 1937 the CPGB's newspaper The Daily Worker obtained and published letters from Baker White to its representative in Manchester, Robert Rawdon Hoare, a cousin of the Home Secretary Sir Samuel Hoare.  The League took the paper and its editor to court for breach of copyright. During the case the Labour MP and future Chancellor of the Exchequer, Stafford Cripps, represented the paper arguing that since the letters discussed illegal activities, in breach of the Official Secrets Act, the Economic League could not claim copyright.
Cripps ingenious defence failed because the court was not prepared to adjudicate on the legality of the League's contacts with the police, the most controversial of the revelations. One of these letters described a deal struck between Hoare and one Detective Eckersley who:
- "... promised to give me as long as I liked looking over the Communist industrial file in their office... I am also in touch with the Salford Police; their Communist man having already called at this office."
Another indicated that the police were going to supply the League with a report of a private CPGB meeting in Brighton. Following this court case, which hinged on the authenticity of the letters since it would not have been possible to own the copyright of a forgery, the League denied that one of the letters, or at least a section had been genuine. It was a letter from White to Hoare describing the League's relationship with the general secretary of the TUC, Walter Citrine:
- "In most areas the League is openly and avowedly anti-communist. Fight against communism, and most particularly in the trade unions. It may interest you to know that co-operation between Sir Walter Citrine and myself on this question is far closer than people imagine... Through an intermediary the League is giving assistance to one very important trade union in fighting communists in its own ranks."
These three different cases all point to the fact that in respect of domestic "counter subversion" there was real, practical, and possibly day-by-day, contact and co-operation between the Economic League and the British state's hard pressed secret servants in MI5 and Special Branch.
The "Anti-Fascist" Activities of the Economic League
The Economic League's contact and co-operation with the secret services was not restricted to their domestic operations. Since 1924 the League, and its director John Baker White, had been playing a significant part in international anti-socialist politics and espionage, through the International Entente and through Section D. During the thirties British espionage activities in Europe were, at least nominally, the responsibility of MI6 (SIS).  But the situation was further confused by the creation of two private international espionage networks - one answering to Sir Robert Vansittart (head of the civil service) the other to Sir Winston Churchill, whose increasingly orthodox Diehardism was to keep him on Parliament's backbenches for the whole of the decade.
The success of fascism in Italy and the emergence of Nazism in Germany was a profoundly destabilising influence on Western European politics. For the last three years of the 1930s Europe seemed to be teetering on the brink of another World War. The reaction of the British radical right, of which the Economic League was a significant part, was complicated. Few on the radical right disguised their admiration for fascism as a political ideology, particularly its adherence to corporatism, authoritarian government, militarism, militant anti-communism and nationalism, and many had themselves influenced and been influenced by fascism for over a decade.
The radical right in Britain also shared, perhaps even shaped, many of the fascists anti-semitic ideas, though shying away from their most brutal manifestation. Yet on the other hand there was a powerful anti-German strain in the thinking of the British right and they were elitist and therefore disturbed by the potentially uncontrollable populism of continental fascism. They were nationalists and imperialists and so, despite their admiration for Hitler and Mussolini, they could recognise the growing threat posed by the fascist powers to the disintegrating British Empire.
These apparently conflicting attitudes were not irresolvable. The radical right adopted a political position that is best described as pro-fascist but anti-appeasement, a line adopted by Churchill himself. Where fascism did not pose a threat to British territorial concerns, in Spain and Portugal, they were supportive. They were divided and uncertain in their attitudes to Italy even after its invasion of Abyssinia. They were determined, despite their admiration for Hitler and the Nazis, that if German rearmament could not be halted then it should be more than matched. They were equally determined that there should be no suggestion of compromise with Hitler's ideas of German expansionism from its colonies or post-armistice borders. Since the end of the Second World War the distinction between 1930s anti-fascism and opposition to appeasement has been blurred, almost certainly deliberately.
Yet there was a real sense in which the fascist tradition within the Conservative Party's radical and nationalist right wing was in fact more authentically fascist than Oswald Moseley's pedestrian impersonations of continental heroes.
Friends of Fascism
By the early thirties Mussolini had established the respect of almost all the Tories and many Liberals, including Lloyd George, and not a few Labour politicians, including Ramsay MacDonald. What was regarded as his "social experiment" seemed to be working, and his ruthless suppression of "Bolshevism" was widely envied. Attitudes only began to change when in 1935 Italy adopted a more aggressive foreign policy which culminated in the conquest of Abyssinia. Nevertheless there were still many respectable politicians who continued to support the Italians enthusiastically.
Harry Brittain was one, and from 1936 to 1939 he was the honorary president of "Friends of Italy".  But supporting Mussolini was different to supporting Hitler. There were many British supporters of the Italian regime, and fascist policies in general, who found Hitler's pagan version of fascism unacceptable; who turned away from its irreligious undercurrents or the brutality of its anti-semitism.
The Anglo-German Fellowship
There were a number of influential British political figures prepared to act as homegrown ambassadors for the Nazis. The Anglo-German Fellowship was their flagship, and at least three of the Economic League's central council members were on the Fellowship's central council - Lord Walter Runciman, Sir Harry Brittain and Lord McGowan. The Fellowship had grown out of a trade delegation to Germany in 1934. The driving force behind its foundation was Ernest Tennant, a merchant banker and friend of the Nazis international PR man von Ribbentrop since 1932. Tennant claimed to have been impressed by the way in which delegates who had been "extremely hostile to Germany" had changed their opinions as a result of the trip, and as a consequence he had established the Fellowship at the end of 1935.  This is simply not a credible explanation.
Ribbentrop was German Ambassador to London and it was his responsibility to sell Nazism to the European governments. As a part of the propaganda campaign he proposed a strategy of fraternal organisations which would "serve the cause of public relations." The Anglo-German Fellowship was certainly a part of this public relations exercise and was mirrored in Germany itself by the "Deutsch-Englische Gesellschaft".
On January 22nd 1936 the AGF's secretary, E Lewis Wright, explained its objectives to the News Review:
- "... it isn't numbers that matter we want "Names", otherwise how can we have any influence with the government and Foreign Office."
It was soon able to boast a membership of 50 members of the House of Commons and House of Lords, 3 Directors of the Bank of England and "many generals, admirals, bishops and bankers." It's first publicity material emphasised that the it was "non-political" and membership "did not imply approval of National Socialism." However it did "ask of its members co-operation in the work of establishing contacts and removing causes of misunderstanding." But the far from politically naive "names" who joined the Fellowship must have been fully aware of their importance to Ribbentrop's mission and Nazi foreign policy. The presence amongst them of enthusiastic supporters of the Nazis would have been reflected at its meetings.
In 1939 a book called Tory MP written under the pseudonym Simon Haxey described the Fellowship's meetings:
- "At meetings of the Anglo-German Fellowship leading Nazis advertise the merits of Germany's internal and foreign policy; the society recommends and advertises the writings of Nazi politicians; it shows Fascist films; it arranges a "German educationalist" to address teachers in this country; it arranges invitations for its members to attend the Nazi congress at Nuremberg."
The president of the Fellowship was Lord Mount Temple (Louis Mountbatten's father-in-law). He held this position until he resigned in protest at "Kristalnacht" in November 1938. Philip Cornwell-Evans was to become its secretary although he too became disillusioned with Hitler, and by 1939 was feeding information to the opponents of appeasement. In addition to the three known Economic League council members the AGF's council included the Lords: Arnold, Eltisley, Hollenden, Brocket, Londonderry, Lothian, Mottisone, Nuffield, Sempill, the Earl of Glasgow, Duke of Wellington and Unity Mitford's rabidly pro-fascist father Lord Redesdale. Members of Parliament included Sir Thomas Moore, Sir Assheton Pownall, Norman J Hulbert, Sir Earnest Bennett, Sir Alfred Knox, and Admiral Sir Murray Sueter. Admiral Barry Domville, who was a successor to Blinker Hall as Director of Naval Intelligence and was to later found the overtly pro-Nazi group called the Link, was also on the Fellowship's central council.
Tory MP's claim that the AGF acted as a British platform for German Nazis, and arranged visits to the Nuremberg rallies is indisputable. Guests of honour at its regular dinners included the Duke and Duchess of Brunswick (July 14 1936), Ribbentrop (December 15 1936), Baron Von der Rop - apologist for Hitler's persecution of the Confessional Church (February 1937) and Field Marshall von Blumberg (May 14 1937). In 1936 Harry Brittain, Admiral Domville, Mount Temple and Sir Frank and Lady Newnes were "Ehrengaste" (guests of honour) at the Nuremberg Rally. The day before the official opening a reception was held to enable them to meet Hitler and his chief officials. Oswald Moseley's sister-in-law, Lady Ravensdale, called them "Ribbentrop's Kindergarten".  In 1938 the AGF contingent at Nuremberg include Lord McGowan and the Lords Stamp, Hollenden and Brocket, but shortly afterwards "Kristallnacht" stung Mount Temple and nineteen other members into resigning from the AGF. Eight-hundred-and-eighty remained as members.
Runciman was, in 1939, sent to Czechoslovakia by Chamberlain as an "impartial" British observer.
Runciman, Brittain and McGowan were not the only Economic League members to be drawn into the Nazi propaganda machine. In 1937 John Baker White's "Dover-Nuremberg Return" was published. Although mildly critical of National Socialism, White was lavish in its praise of Hitler: "a great man" with "very great ability, courage and perseverance." He emphasised Hitler's achievement: "... of the depths and given it back its soul. He has done more, he has given it that precious thing, self confidence, and hope in the future."
The main cause of White's ambivalence to National Socialism was its socialist aspects. He recognised "In Germany today full-blooded Socialism is in practice so far as the administration of Industry and labour is concerned," and he was careful to stress that Nazism was, "very similar to the beliefs of the social democrat and even of the less extreme communist." This extraordinarily inept political analysis was precisely the sort of message the Ribbentrop wanted delivering to the British people. It also reveals that Diehard opposition to Nazism was based on the idea that it made too many concessions to working people.
Interestingly the idea that Nazism in particular, and fascism in general, was a political ideology of the left or centre has continued to enjoy some currency in Diehard and authoritarian Conservative circles. It is not an argument the stands up to scrutiny. Nationalism, fanatical anti-socialism and anti-communism, suppression of trade unionism and its replacement by employer-led free-enterprise corporate statism, racial intolerance and authoritarian government can hardly be said to be defining features of the left's ideologies. The most that can be said is that although fascism shared all these ideas with Diehardism, the diehards were even more ruthless and right wing in their attitudes to the interests of working people.
But merely being less right wing than the diehards doesn't, as some academics have argued, make fascism a movement of the political centre.
The conciliatory and sympathetic treatment of Nazism in "Dover-Nuremberg Return" must have been well received by the Nazis. It certainly fitted in with Ribbentrop's international propaganda exercise, and would have been enough to have ensured White's place on the Germany Embassy's guest list. For all its half-hearted criticisms of Nazism, Baker White's declared objective was exactly the same as the AGF's and Ribbentrop's, "to remove causes of misunderstanding":
- "... false statement, especially when accompanied by malicious cartoons, only serves to prevent two great nations understanding one another a little better... Be this said for the German People. They are making greater efforts to understand us than we are to understand them."
In "Dover-Nurenburg Return" White was at great pains to play down Nazi anti-semitism:
- "[I] found no evidence of bitter anti-Jewish feeling amongst the ordinary people and no support among the mass of the Nazi party for Streicher's campaign."
He even went so far as to suggest that anti-semitism was more pronounced in the British fascist parties. As a lifelong friend and associate of Nesta Webster, the most determined and effective of Britain's anti-semitic propagandists, White can hardly have been an impartial witness to Nazi anti-semitism. However his suggestion that anti-semitism was just as pronounced in Britain in the 1930s as it was in Germany is almost right.
Even before the Great War and the Russian Revolution anti-semitism was a deeply rooted characteristic of British society. With these two events however there emerged a much more aggressive type of anti-semitism. The large German jewish emigre communities in places like the East End of London and the textile cities of Leeds and Bradford in Yorkshire had become the focus of much of the "anti-alien" agitation of the Anti-German Union and British Empire Union.  The Diehards, and especially Hall, Gretton and Makgill were particularly associated with this fiercer brand of anti-semitism. In the early 1920s forged papers, with the title of "The Protocols of the Elders of Zion" were published which purported to be concrete evidence supporting the theory that there was an international Jewish world-domination conspiracy.
The Duke of Northumberland and his battalion of Diehards (which also included Basil Thompson) were at the forefront of agitation about the faked "Protocols".  In his book Industry and Empire Prof. Eric Hobsbawm dismisses as a "journalistic impression" the vision of the years preceding the Great War as "a stable belle epoque of ostrich-plumed ladies, country houses and musical hall stars."  They were on the contrary, he suggests, years when the "stable and flexible mechanism of British political adjustment ceased to function." They were the years "when an extreme right, not merely ultra-conservative but nationalistic, vitriolic, demagogic and anti-semitic, looked like emerging into the open."
Hobsbawm's suggestion that the Great War "came as a respite from crisis, a diversion, perhaps even as some sort of solution" may well be wide of the mark. For on the contrary the War, followed by the Russian Revolution, detonated the anti-semitic explosion. Makgill's Anti-German Union, and the British Empire Union were its most public manifestation. After the War, and even after the "Protocols" were exposed as a fake, the Duke of Northumberland and Nester Webster, whom he published, continued to promote them as genuine and argued fanatically for the idea of a jewish world conspiracy. The influence and effect of Northumberland and Webster's work on the emerging National Socialists in Germany, and Mussolini in Italy was incalculable.
Faced by growing anti-semitism in Britain, within the British Jewish community itself there was increasingly radical and enthusiastic support for Zionism - the idea of a Jewish nation in Palestine. Ironically inside Parliament, and outside it, the Zionists rapidly gained the support of key Diehards and fellow travellers like Churchill. Not for the last time in history, racist politicians seized on the idea of "separate development" and created an unholy political alliance with leading members of the very community they were persecuting.
In the 1930s this Zionist/Diehard alliance, with Churchill at its centre, was further strengthened by events in Germany.
Writing after the War John Baker White was to claim that he, the League and Section D played a part in the pre-war anti-Nazi movement, and that the League even published, on behalf of Section D, one of the first exposes of the Nazi fifth column in Britain. As with all White's writing he presents a frustratingly inaccurate cocktail of small truths and big lies.
"Section D" Revisited
According to White, following "McGill"'s death his own section the intelligence operation run by Makgill had determined to continue to function, on a self-financing basis. This he says it did until the outbreak of the Second World War, during which a number of its members became involved in resistance movements. In his accounts of the activities of the post-Makgill Section D, White concentrates on investigations into alleged sabotage, especially on marine shipping, and two cases in particular - fires on board the Phillipar and the L'Atlantique. Throughout his autobiographical accounts he also makes much of Section D's investigation of German rearmament and the growth of Nazism. There are strong reasons to question whether White was, before the end of appeasement, the dedicated anti-Nazi he tries to make out. The fullest account of White's, and Section D's, investigations into sabotage on shipping are to be found in his 1957 book Sabotage is Suspected.
Piecing together these accounts it is possible to establish a sketchy battle order for the post-Makgill Section D:
- Yves - a recent Sorbonne graduate working on Le Matin in Paris, and still working as a journalist in 1970.
- Max - "who was a 'wagon lit' conductor between Paris and Geneva", shot by the Gestapo.
- Jim Finney - active around Portsmouth and south coast ports, he died in 1955. Finney worked with White on investigation into suspicious fire on the French Liner the "Georges Phillipar" in 1932 and then on L'Atlantique in 1933.
- George(s) Picard - a member of White's Phillipar and L'Atlantique team, based in Paris. He was later shot by the Gestapo.
- Mick - a member of White's L'Atlantique team who was arrested in France and then operated from Brussels, he was still alive in 1957, but by the time White was writing True Blue he had lost contact with him.
- F W Memory - Journalist with the Daily Mail, he helped on the L'Atlantique inquiry.
- George Martelli - Morning Post correspondent in Paris, he helped with the L'Atlantique. He seems to have had some intelligence connections, later wrote The Man Who Saved London, an account of the French resistance organisation run by Michel Hollard.
- Irmgard - A "good looking and highly attractive young [German] woman" who obtained details of German rearmament and troop strengths and movements by acting as a pen pal to soldiers.
- Trudi - As well as being pen pal, like Irmgard, she also obtained a job as a door-to-door saleswoman of sewing machines in garrison towns like Essen, in order to obtain details of troop strengths and deployment.
- Unnamed - Costing clerk in Krupps, the German engineering company and arms manufacturers.
- Unnamed - "One of the men who worked for him ["McGill"] died gallantly in Spain fighting in the International Brigade. He went there to get vital information on the participation of Soviet Russia and the working of OGPU in Republican territory."
- D23 - "Died under torture in Gestapo headquarters in Dusseldorf."
- D17 - "Killed in Essen by a British bomb."
- [Of D23 and D17 White says: "Both were German patriots who loathed Nazism as an evil thing."]
- D19 - British liaison officer with French Resistance, "died in a running battle with Darnand's milice in the Pays des Dombes. Under his French alias he is remembered on resistance memorial at the side of the road from Lyon to Bourg en Bresse."
- D8 - Still alive in 1955, married to a Frenchmen, she was tortured by Gestapo and left with scars and a limp. She was 19 at the outbreak of war, and "to the outside world appeared to devote the whole of her time to enjoying herself in the world of society." Invited by Otto Abetz to join a party of French to meet Hitler.
- D31 - Spent the war on an oil tanker, was in 1955 living in South America, "where he keeps an eye on the... members of the Abwehr and German General Staff now working on some of the huge German-owned estancias."
- Unnamed - A member of Section D was present at meetings of the Link.
Section D, Hitler and Churchill
John Baker White's accounts of Section D in the 1930s emphasise its investigations of German rearmament, and the growth of Nazism. The first, in It's Gone For Good, was written after the outbreak of War, the rest were written after the war, and it is difficult not to believe that these accounts are an attempt to sanitise the group's activities.
White's interest in Nazism was first aroused, he claims, in the late twenties. Whatever work he was doing with the Economic League, Section D and The International Entente had led him to make regular trips to Germany, not merely as a tourist but as a guest at the arms manufacturer Krupps. He was also a visitor to the SA headquarters in Munster and his visit to the Nuremberg rally had been at the instigation of General von Reicenau. 
According to White, information obtained by himself and other Section D agents was fed to the British government. His reports were not taken particularly seriously:
- ". . . between 1935 and 1938, with the assistance of our anti-Nazi German contacts, we passed to the War Office, a wealth of technical information about armament plants, including complete specifications of weapons, catalogues and so on."
When, on moving from the London Rifle Brigade to MI10 in the early years of the Second World War, White asked for these files he says that he was told that "it was all scrapped because it came from non-official sources." Writing in 1942 he says that his reports had been regarded as "of doubtful value." But the Government were not the only ones to receive his reports. Indeed they soon only got carbon copies, since the top copies went to Churchill.
According to White there had been, at the time the reports had been sent, a "lack of interest in official quarters" and "a member of our Embassy staff" in Berlin" had suggested White went to see Churchill:
- "He's constantly studying German re-armament, and I know that at least two British journalists in Berlin are supplying him with information."
One of them, who White "knew quite well" gave him an introduction to Churchill. The likely candidates here are Euan Butler of The Times or Paul Bretherton of the Daily Mail and both of whom White talks of meeting in Germany. However according to White when Churchill first received him he was "frosty, almost suspicious until I happened to mention that I had worked for Sir George McGill." But then, he says:
- ". . . from then until the outbreak of war we sent our reports to Churchill, with a carbon copy to the War Office or Foreign Office. It was some time after the war had broken out that I discovered that both departments had been to considerable pains to find out where the top copy was going. They never did."
Churchill insisted that reports on Germany were non-verbal, typed treble spaced on one side of paper and White says he last reported to Churchill on October 4th 1938. There is no evidence to corroborate White's claims about his, and Section D's, relationship with Churchill, and our ability to judge the evidence is not helped by the rather fragmentary picture of the independent "anti-appeasement" intelligence services that we know were operating in the 1930s. Broadly speaking there were two of these. One of them reported to Churchill, the other to Sir Robert Vansittart.
Vansittart was permanent under-secretary at the Foreign Office from 1930 to 1937, and though one of the country's most senior civil servants he was vehemently anti-German. He was a friend of "C" - that is Admiral Sir Hugh Sinclair, head of SIS (better known as MI6) - but for all his power and influence Vansittart found himself unable to use his influence to extract additional resources for SIS. Thus he came to rely increasingly on his own intelligence sources, and a sort of quasi-official network run by the veteran British agent, Claude Dansey, then working for SIS in Rome.  Given the powerful industrial backing for the Economic League, of which John Baker White was Director General - particularly from the defence based industries - it would have been less surprising to find Section D linked with the Dansey/Vansittart "Z organisation" than with Churchill's. The "Z Organisation", for example, made use of a number of company's foreign representatives including Rex Pearson of Unilever and Basil Fenwick of Shell, both operating in Zurich.
Churchill's anti-appeasement intelligence network was more diverse than Vansittart's, and is little understood today. It was also, of course, reporting to someone far more publicly engaged in harrying the government over appeasement. Although these were Churchill's "Wilderness Years", that is the decade when he was kept out of public office, he was not entirely denied access to secret service reports. His main source of official, secret, information during these wilderness years was Desmond Morton. A friend and protege of Churchill's since the First World War, Morton was appointed head of the Foreign Office's Industrial Intelligence Centre (IIC), when it was founded in 1931.  The IIC received secret intelligence reports and collated information from ministries. According to Christopher Andrew, Churchill was given official access to this information by three successive prime ministers during his so called "wilderness years": Ramsay Macdonald, Baldwin and Chamberlain. 
In addition to his access to official secret sources, Churchill operated his own intelligence service. The key question, as yet difficult to answer, is just how coordinated this service was. Volume three of the Companion to part V of Martin Gilbert's biography of Churchill contains a great many documents that point to how extensive his sources were not only for foreign intelligence but also on the state of British rearmament. Unfortunately none make mention of White or his organisation, nor do the documents give any indication of how Churchill maintained and organised his personal intelligence service. An extraordinary clue to this is given in an unusual place: A Man Called Intrepid. This 1976 biography of William Stephenson, the head of British Security Co-ordination during the Second World War, was effectively sponsored by the intelligence services. Writing in an introduction to the book Charles Howard Ellis explained that the official decision to at last release so much information to the author, the confusingly named William Stevenson, had been inspired by learning that the Russians had learned enough to make it possible for them to use BSC "to bludgeon our friends, to distort history, and to hurt United States and Canadian relations with Britain." "Full disclosure," he wrote, "was the answer to this threat and to the demands of history." 
This dubious pedigree must make us view A Man Called Intrepid as an thoroughly unreliable source. Nevertheless if it was a pack of lies there was no obvious advantage to be gained. According to A Man Called Intrepid, by the early 1930s none other than Reginald "Blinker" Hall "was now Churchill's personal intelligence chief." The League's founder was now pulling together a number of "informal groups" which "consisted of men and women who saw war as inevitable, but whose views ran counter to British policy":
- "Some came from the British Secret Intelligence Service itself, whose servants were bound to obey the government of the day. If that government chose to belittle the dangers of war, what was a loyal intelligence officer to do?"
This, not perhaps unfamiliar dilemma, was "partly solved" by Desmond Morton, who from 1935 - according to Stevenson - was assigned "to discover the plans for the manufacture of arms and war stores abroad." This is precisely what Baker White claims Section D was doing. Still more intriguing is the claim that "neither Churchill nor Morton had parliamentary authority" and "Their support came from the King, that higher authority whose intervention was permissible in times of crisis, although it could be challenged."
Stevenson's describes this as a "traditional arrangement":
- "...by which the monarchy and the funds set aside for royal functions could be used to protect those acting secretly to defend the national interests..."
"It was," he says, "to prove vital in the secret wars to come... Focus, Electra, and the XYZ committee." If Morton and Hall were, as A Man Called Intrepid suggests, the two lynchpins in Churchill's intelligence network then it is inconceivable that White's account of his introduction to Churchill is anything other than ingenuous: he simply did not need a contrived introduction involving the British embassy in Berlin.
According to A Man Called Intrepid, the key group at the centre of the private intelligence network organised by Hall, acting for Churchill, was a group called "Focus". Although there has been no serious academic study of this group it is possible to say not only that it existed, but that it was a significant force in anti-appeasement politics in the 1930s. Unfortunately only A Man Called Intrepid links it with Hall.
Focus was first launched at a luncheon in the Hotel Victoria on 19th May 1936. Churchill and Lady Violet Bonham Carter were at the top table. Sir Robert Mond, of ICI, was there too as was Sir Archibald Sinclair (later Viscount Thurso). A H Richards, publicity manager of the News Chronicle and organising secretary of the Anti-Nazi Council, was its secretary and a manifesto committee was established under the direction of Henry Wickham Steed which also included Robert Whalley Cohen and Violet Bonham Carter. By July the group had begun to draw into its circle a small number of Labour Party figures including, interestingly enough, Sir Walter Citrine. The financing of the group remains something of a mystery, although Eugene Spier, the emigre German politician and businessman, claimed to have funded it to the extent of £9,600 between 1936 and 1939 and Mond had given £500 in July 1936 to finance research under the supervision of Wickham Steed. The Nazi historian David Irving has since claimed that Focus was substantially funded by the Board of Deputies of British Jews, and insists on portraying Focus as a Jewish conspiracy to purchase and particularly to direct Churchill's agitation for war with Hitler.
Irving, spectacularly, begs questions - Did Churchill's support need to be purchased? Would he really have taken direction? Did the Focus' agitation for re-armament amount to agitation for war? But if Irving's analysis of the situation is weak, and motivated by a disturbing underlying political motive, he was right about many of the facts. The Focus was a conspiracy, and Churchill remained conspiratorial about it until the end of his life - imploring Spiers not to publish a memoir of the group as late as 1963. It never held public meetings in its own name, always using the cover of the "New Commonwealth Society" or "League of Nations Union". Indeed in letters Churchill himself described it as "private and secret".
The Focus was an example of the singularly unholy alliance between anti-semites and Zionists. Indeed Blinker Hall had been one of the ring leaders of the anti-semitic propaganda about the Protocols of the Elders of Zion in the 1920s. But although superficially contradictory, it was not unbelievable for a thoroughgoing anti-semite to find the idea of an independent Jewish state attractive, especially as pre-War Zionism's main opponents were to be found on the ultra-left, led by anarchists and the followers of Trotsky. 
Another Section D?
By the end of the thirties the trail for Section D becomes confused by the apparent creation, by the head of SIS, of another Section D. This Section D was a secret propagandist, and later sabotage, organisation which was in 1940 transformed into the Special Operations Executive. Writing in The Black Game, Ellic Howe suggests that "it is unlikely that a detailed account of Section D's origins and early days will ever be written." Howe himself is critical of some accounts by Bickham Sweet-Escort, Julian Amery and Kim Philby, which place its creation around the time of the Munich Crisis, since it had been run by Major General Laurence Grand, a Royal Engineers officer, since the spring of 1938. This at least leaves open the tantalising possibility that the two organisations were not distinct. And that White had, in the run up to war relinquished control of Section D and seen it more or less absorbed into the intelligence establishment. 
As an intriguing footnote to this when Colonel Maurice Buckmaster died in 1992 the Economic League was represented at his memorial service by someone called Mark Philips. Buckmaster had been one of the SOE's main organisers of operations in France during the war. Buckmaster was not known to have had any connection with the League. However another important SOE figure, Colonel James R H Hutchison, was a central council member after the War.
Section D, MI5 and the Economic League
The relationship between the post-Makgill Section D and the Economic League was more straightforward than it might at first seem. Section D was run by White, as was the League, although in respect of the latter, White answered to a central committee. But it was not just that information was shared by the two groups. When, in 1938, it was decided to publish a limited amount of information that White says Section D had gathered on the "Nazi fifth column" it was done by the Economic League. This pamphlet - "German Propaganda in Britain" - is quite eccentric, and certainly fails to live up to White's later description. It also omits what, even at the time, would have been obvious information about the Anglo-German Fellowship. 
The "National Defence Campaign"
In 1937, while its leaders were still enjoying the hospitality of the Nazis, the League launched its "National Defence Campaign". According to Fifty Fighting Years this had "the dual purpose of arousing industrial workers to the growing danger and need for re-armament, also of countering subversion in defence industries."
There was nothing unusual or contradictory about the way in which the League combined advocacy of rearmament and sympathy for continental fascism. It was the classic Diehard position at the time.
Victor Gollanz published a famous series of wartime books on the pre-war fascist sympathies of the Tories. It began with The Guilty Men by "Cato" which was followed by The Trial of Mussolini ("Cassius") and Your MP by "Gracchus". In Your MP the Diehard position is illustrated with a number of extracts from Tory speeches. As late as November 15th 1938, R A Butler MP was arguing: "If the Socialist Party is prepared to make friends with Russia, which is a dictatorship with which no Englishman can really agree, why can we not make friends with Italy and Germany? There are people saying Herr Hitler has broken his word. I tell you there is one bargain he has made - that is the German Navy should only be one-third of the British Navy - which he has kept loyally."
The Diehards were not actually advocating re-armament in preparation for war with Fascism. They steadfastly opposed the suggestion of, what another Tory MP, Roger Conant, called "The Liberal-Socialist proposal for an alliance with France and Russia against the Fascist powers."  In 1937 especially, the Tory right hoped that if war was to come then Britain would be in alliance with the fascist powers.
Twelve weeks into the war another Tory MP, Cyril Tom Culverwell, was arguing in Parliament for a "Peace by negotiation," saying, "I can even visualise our troops fighting side by side with the Germans to defeat the Bolshevist menace." 
However pressure on the Economic League to agitate for rearmament was not exclusively, or primarily, political. A massive rearmament programme would be a tremendous boost to its paymasters in the heavy and light engineering industries. In early 1939 the National Defence Campaign was extended to include a "National Service Campaign". According to Fifty Fighting Years:
- "Its purpose was to explain the problems of national defence to counter Communist and other efforts to impede production in the defence industries, and to encourage recruiting for the various branches of the voluntary national service."
This "National Service Campaign" harked back to a Diehard obsession during the Great War. The Diehards of 1912 had previously formed the National Service League to campaign for a conscript army. Its members included Lord Milner, who became its chairman in 1915. When, in May 1916, Conscription was introduced it had - like many Government Departments - its own Intelligence section. Its Director of Intelligence was Sir Harry Brittain, journalist, Tory MP, and one of the earliest members of the Economic League's council. From 1916 until the end of the War, ministerial responsibility for recruitment fell to Sir Aukland Geddes, another future leader of the League.
When war was declared with Germany on September 3rd 1939 the League had to rapidly re-adjust. The previous month the League had decided that in the event of war it would continue to function. The immediate problem it faced was that its director - John Baker White - was a Territorial Army officer in the London Rifle Brigade. Another of the League's most senior employees - Robert Rawdon Hoare - was a major in the Regular Army Reserves and also immediately called up (as a major in the Royal Horse Artillery). White was initially recruited to MI7 as head of Radio Propaganda, although he also spent some time in MI10, responsible for investigating enemy technical developments. The following year he joined the Ministry of Information. In 1941 he was transferred to the Political Intelligence Department of the Foreign Office and thence (in 1943) to the Political Warfare Executive working on black propaganda in the Middle East.
Throughout the War Baker White remained the Director of the Economic League, but the day-to-day running of the League was taken over by Major Tom Gribble. Eventually Gribble was also recruited to the Political Warfare Executive, but being stationed in London he combined the two jobs. Throughout this period, according to Fifty Fighting Years:
- "Sterling service was also rendered by Miss Mollie Calder and Major Hugh Gillespie, who wrote all the League's notes for speakers... for over 25 years."
Before the end of 1939 the League had issued five leaflets: "What you should do", "The Home Front", "Communism Unmasked", "The Citizen in War", "Prices, Wages and Inflation" and "Wages in War". In 1940 sixteen leaflets were produced and the following year thirteen leaflets. When P.A.Y.E. was introduced the League sprang to its defence.
Until the collapse of the Hitler-Stalin Pact the Economic League had concentrated on anti-communist propaganda, but later the leaflets echoed government propaganda efforts and concentrated on morale boosting on the home front. "Don't be Bored" was their rather weak rallying cry. Then as paper rationing began to bite the League increasingly concentrated on factory canteen meetings.
Just as during the General Strike the League had acted as a source of intelligence for the Government, once again it was not just preaching propaganda but gathering intelligence. Home Intelligence produced regular reports on the mood and morale of the public. According to Angus Calder, in The Myth of the Blitz (Cape, 1991, ISBN 022402258X), the Economic League was one of the many sources of information upon which these reports were based. Other included W H Smiths and Mass-Observation, as well as police and telephone and postal censorship.
In the last year of the war the League paid special attention to women workers and issues about food and even produced a special booklet: "Women at War - Their Future in Peace."
The Political Warfare Executive
It is worth examining the PWE in a little detail since it throws light on the skills that White and Gribble were felt, by intelligence, to posses. The PWE was, according to Anthony Boyle's description in Climate of Treason:
- "The tripartite propaganda machine which [Hugh] Dalton, in Bracken's view, regarded as his own property."
The three ministries that exerted control of it were the Ministry of Information (under Brendan Bracken, a director of publishers Eyre and Spottiswoode, part owner of Financial Newspaper Proprietors company which owned the Financial News, Investors' Chronicle and half The Economist, who had also formerly been Churchill's parliamentary secretary), The Foreign Office (under Anthony Eden) and the Labour politician Hugh Dalton's Ministry of Economic Warfare. In July 1940 Churchill had given Dalton the responsibility for coordinating sabotage and propaganda; exhorting him to "Set Europe ablaze!" He immediately appointed Gladwyn Jebb, from the Foreign Office, as his aide with special responsibility for the new organisation - The Special Operations Executive (SOE).
SOE initially absorbed three intelligence organisations: Section D of SIS (MI6), which employed Kim Philby and Guy Burgess; Military Intelligence Research (MIR), which (under J C F Holland and Colin Gubbins) prepared a number of manuals on guerrilla warfare; Department EH (Electra House) of the Foreign Office, a "semi-secret propaganda department which was developing "black" propaganda." 
SOE was divided into two Branches - SO1 (Subversion/Sabotage) and SO2 (undercover propaganda). A year after the formation of SOE the Foreign Office's contribution in Electra House was separated off as the Political Warfare Executive. As an organisation for "Black Propaganda" it used lies, or more politely "misinformation", as a political weapon. The BBC on the other hand, then controlled by the Ministry of Information, resisted using outright lies in its own propaganda. It was only in 1942, when Dalton was moved to the Board of Trade, that some of the confusion between the roles of the PWE and SOE was resolved. The PWE, headed by the secret service veteran Robert Bruce Lockhart, came completely under Bracken's control.
The coming of the Second World War brought to an end the first phase of the Economic League's development. Its influence on the British State and "high" politics, indirect and clandestine though it was, had reached their climax. In the years since that War it never quite recovered that influence. Whereas it had emerged and grown to plug some of the gaps left by the dismantling of the machinery of the wartime secret state after the Great War, the secret state never demobilised after the Second World War. The cold war, and its obsession with an "enemy within", meant that on both sides of the Atlantic fantastic resources were ploughed into the surveillance of the British labour movement, and the undercover support of anti-socialist movements.
In this atmosphere the Economic League inevitably thrived, but could not occupy such a central role as it did in the twenties and thirties. For during those decades the League was the most significant unofficial organisation involved in these activities, and was probably better equipped for such work than MI5 or the Special Branch.
Because of the sensitive nature of the secret services' operations against the domestic population, the League could never have expected proper recognition of its role in developing "counter subversion" and anti-socialist propaganda in the inter-war years. But it had undoubtedly providing a spring board for the CIA in America, and MI5 and the Information Research Department in Britain.
But as an organisation with its own Diehard Conservative political message the League faced even greater problems in the post war years. The success of the Attlee government's programme of nationalisation and introduction of the Welfare State shifted the political ground significantly away from the Diehards. So innocuous were these reforms to the Conservative governments which governed without a break between 1951 and 1964, that the idea of a "Mixed Economy" with thriving private and state-owned sectors became a part of mainstream Conservative Party ideology. The League's continuing advocacy of unregulated free enterprise, and the absence of an effective Conservative parliamentary support for its political position, left it isolated from "high politics" for the best part of twenty years.
However the way in which the Economic League perpetuated the Diehard's manifesto throughout these lean post war years was to be as remarkable as the way in which it had maintained the spirit, and machinery, of the Great War's draconian intelligence network during the twenties and thirties.
Notes and References
(see Bibliography for full details)
- ^ Carew
- ^ Tom Cullen, "Maundy Gregory - Purveyor of Honours", Bodley Head
- ^ Sir Samuel Hoare, Foreign Secretary June 1935 - May 1937, Home Secretary May 1937 - September 1939
- ^ The relationship between SIS and the various private and quasi private networks was ambiguous. Vansittart's network was very close but Churchill's network also had its connections.
- ^ The Honorary Secretary was Chev. T Sambuccetti, Morley House, 320 Regent Street
- ^ Ernest Tennat, "True Account", 1957
- ^ Also present as guest of honour in 1936 were Sir Thomas Moore, Arnold Wilson, Admiral Sueter, Lord Apsley and Sir Frank Sanderson.
- ^ See David Caesarini, Stella Yarrow and Panikos Panayi in "The Politics of Marginality", ed Tony Kushner and Kenneth Lunn, Frank Cass, 1990
- ^ Richard Griffiths "Fellow Travellers of the Far Right", Constable, 1980
- ^ Eric Hobsbawm, Volume 3 of the Pelican History of Britain, 1969, p163
- ^ John Baker White, "It's gone for good"
- ^ See Anthony Read and David Fisher, "Colonel Z", Hodder and Stoughton, 1984.
- ^ Andrew p502
- ^ Churchill also had access to secret information by virtue of his membership of sub committee of the Committee for Imperial Defence.
- ^ It seems Ellis had himself been passing on information to Nazi Intelligence, includin MI6's battle order, prior to the outbreak of the Second World War (see Nigel West, "A matter of Trust", Weidenfeld and Nicolson, 1982) .
- ^ Apart from fleeting references in a small number of general books, the references in William Stevenson "A Man Called Intrepid", Macmillan, 1976 and Eugene Spiers "Focus" (1963) the most substantial study of the Focus is in David Irving's "Churchill's War", and the Companion Volume V to Martin Gilbert's biography of Churchill. As with much of Irving's work the problem lies not with the quality of the research as with the analysis and interpretation, and the unpleasant insinuations and style. Unfortunately because the Focus plays a central role in his argument that the Second World War was a Jewish conspiracy he is at his most unpleasant when writing about the Focus group. Irving has in fact called his own neo-nazi think tank the "Focus Policy Group", and this if nothing else is a reason for an urgently needed and comprehensive study of Churchill's group. A slightly more detailed account of The Focus, by myself, is to be found in "Lobster 25".
- ^ Ellic Howe, "The Black Game", Michael Joseph, 1982. Bickham Sweet-Escort "Baker Street Irregular", 1971, Julian Amery "Approach March", 1973, Kim Philby "My Secret War",1968.
- ^ "German Propaganda in Britain", Economic League, July 1939
- ^ Yorkshire Post 4/4/38
- ^ 30/11/39
- ^ See Andrew. The history of SOE has been more chronicled than any other section of the British secret state.