Werner Michael Blumenthal (born January 3, 1926) is a German-American business leader, economist and political adviser who served as United States Secretary of the Treasury under President Jimmy Carter from 1977 to 1979.
At age thirteen, Blumenthal barely escaped Nazi Germany with his Jewish family in 1939. He was forced to spend World War II living in the ghetto of Japanese-occupied Shanghai, China, until 1947. He then made his way to San Francisco and began doing odd jobs to work his way through school. He enrolled in college, eventually graduating from University of California, Berkeley and Princeton University with degrees in international economics. During his career, he became active in both business and public service.
Before being appointed to a cabinet position with newly elected President Jimmy Carter, Blumenthal had become a successful business leader and had already held senior positions in the administrations of Presidents John F. Kennedy and Lyndon B. Johnson. As a member of the Carter administration, he helped guide economic policy and took part in re-establishing ties with China. After he resigned, he became chairman and CEO of Burroughs Corporation and Unisys, followed by seventeen years as director of the restored Jewish Museum Berlin. He is the author of The Invisible Wall (1998, Counterpoint Press), From Exile to Washington: A Memoir of Leadership in the Twentieth Century (2013, The Overlook Press) and The Payday Conspiracy: A Berlin Noir (2024, Solanum Press). Blumenthal is the oldest living former U.S. Cabinet member and the oldest ever.
Early life and education
Blumenthal was born in Oranienburg, Weimar Republic (present-day Germany), the son of Rose Valerie (née Markt) and Ewald Blumenthal, both of German-Jewish origins. His family was of well-to-do means as owners of a dress shop.Current Biography Yearbook His forebears had lived in Oranienburg since the 16th century. As a result of the Nazi party's Nuremberg Laws, which took effect in 1935, his family began to fear for their lives and realized they had to escape from Germany. Blumenthal recalled Kristallnacht, a series of coordinated attacks against Jews and their property which began throughout Germany on November 9, 1938, when he was 12 years old:
Nazi Gestapo men forced their way into his home early one morning in 1938 and arrested his father for no stated reason. His father was taken to Buchenwald concentration camp, one of the largest forced labor camps in Germany, where an estimated 56,000 people, mostly Jews, were eventually killed. His mother hastily sold all their household possessions and managed to win her husband's release. They had no choice but to sell their long-established dress store to their managing saleswoman for "practically nothing," says his older sister Stefanie. She recalls, "My mother wept—not so much out of the loss, but out of a sense of the unfairness of it, that someone we'd trained could turn on us, could get something we had worked so hard for, for nothing."Chesnoff, Richard Z. Pack of Thieves, Anchor Books (1999) p. 20
With their little remaining money, his mother bought tickets for them to go to Shanghai, China, an open port city which didn't require a visa. They fled Germany on a passenger-carrying freighter shortly before war broke out in 1939. They took only minimal possessions; they were not allowed to take any money. He remembers the voyage: "From Naples via Port Said, Suez, Aden, Bombay, Colombo, Singapore, and Hong Kong; each one of those ports of call was part of the British Empire, and none would admit Jewish refugees."
Upon arriving, they expected to remain only briefly, assuming they could then travel on to a safer country. However, with the outbreak of World War II, Japan had occupied Shanghai, and the Blumenthals were forced to live in the Shanghai French Concession and then, from 1943-47, in the Shanghai Ghetto.
Blumenthal witnessed severe poverty and starvation throughout the ghetto, sometimes seeing corpses lying in the streets. "It was a cesspool," he said. He was able to find a cleaning job at a chemical factory and earned $1 a week, which was used to feed his family:
His schooling was haphazard, and the stress of survival caused his parents to divorce. Nevertheless, he was able to learn English during a brief period attending a British school, and learned to speak some Chinese, French and Portuguese during other periods there.Katz, Bernard S., and Vencill, Daniel. Biographical Dictionary of the United States Secretaries of the Treasury, Greenwood Publishing (1996)
When the war in the Pacific ended in the summer of 1945, American troops entered Shanghai. He found a job as a warehouse helper with the U.S. Air Force, which benefited from his linguistic skills. By 1947 he and his sister, after much effort and being refused visas to Canada, received visas to the U.S.
They made their way to San Francisco, where they knew no one, and with only $200 between them.Kaufman, Diane, and Kaufman, Scott. Historical Dictionary of the Carter Era, Scarecrow Press (2013) p. 42 With limited education, and now a stateless refugee, he did his best to make something of himself:
Education Blumenthal found his first full-time job earning $40 per week as a billing clerk for the National Biscuit Company. He later enrolled at San Francisco City College and supported himself doing part-time work, including truck driver, night elevator operator, busboy and movie theater ticket-taker. He also worked as an armored guard and at a wax factory, where he filled "little paper cups with wax" from midnight until 8 a.m.
Blumenthal was admitted to the University of California, Berkeley where he graduated Phi Beta Kappa in 1951 with a B.S. degree in international economics. It was also where he met and married Margaret Eileen Polley in 1951. In 1952 Blumenthal became a naturalized U.S. citizen.
Blumenthal was offered a scholarship to attend the Woodrow Wilson School of Public and International Affairs at Princeton University, in New Jersey. From there, he earned a Master of Arts and Master of Public Affairs in 1953, followed by a Ph.D. in economics in 1956. Blumenthal's doctoral dissertation was titled "Labor-management relations in the German steel industry, 1947-54." For income, his wife worked as a secretary and he taught economics at Princeton from 1954 to 1957. He also worked as a labor arbitrator for the state of New Jersey from 1955 to 1957.
Career
Blumenthal left Princeton University to join Crown Cork, a manufacturer of bottle caps, in 1957, where he remained until 1961 and rose to become its vice president and director.
In 1961, having by then been a registered Democrat, he moved to Washington, D.C., following John F. Kennedy's inauguration, where he was offered a position by diplomat, George Ball, to serve as Kennedy's deputy Assistant Secretary of State for Economic and Business Affairs. He accepted the position and served in the State Department from 1961 until 1967 as an adviser on trade to Kennedy and, after Kennedy's assassination, as an adviser to Lyndon B. Johnson.
Johnson made him U.S. Ambassador and chief U. S. negotiator at the Kennedy Round General Agreement on Tariffs and Trade talks in Geneva, considered to be one of the world's most significant multilateral trade negotiation. Canada's Minister of Trade and Commerce described Blumenthal as a tough negotiator, which Blumenthal feels is ironic: "If they'd let me into the country in 1945, I might have been working on their side."
In 1967, Blumenthal left government to join Bendix Corporation, a manufacturing and engineering company specializing in auto parts, electronics and aerospace. After five years he was appointed as its chairman and CEO, and remained with the company for ten more years. When he first took over Bendix, the company was regarded by Wall Street as a faltering company. After five years as its chairman, the company nearly doubled its sales to just under $3 billion, and by 1976 Duns Review rated Bendix as "one of the five best-managed companies in the U.S."
While Blumenthal headed Bendix, newly elected President Carter nominated him to become his U.S. Secretary of the Treasury, a position in which he served from January 23, 1977, to August 4, 1979. Cyrus Vance had originally wanted him to be his deputy when he became Carter's Secretary of State, but Carter decided he would be better placed as Secretary of the Treasury.Biven, W. Carl. Jimmy Carter's Economy: Policy in an Age of Limits, Univ. of North Carolina Press (2002) e-book His nomination was unanimously confirmed. That June, he traveled to the Organisation for Economic Co-operation and Development's (OECD) Paris headquarters for its annual conference, with its main agenda concerned with how Western powers would manage the sluggish recovery after the deep recession of 1974–75.Moffit, Michael. World's Money, Simon and Schuster (1983) p. 133
Blumenthal first met Carter in 1975 at a meeting of the Trilateral Commission in Japan. Carter subsequently invited him to his home knowing his talents as a successful business manager and negotiator, and knew Blumenthal would offer him sound economic advice. Blumenthal recalls at the time, "The list of top Democratic businessmen isn't very long." In accepting the position, his income went from $473,000 per year to $66,000. He was also amused at the irony of reading a German newspaper headline, "A Berliner is to Become Carter's New Minister of Finance."
As Secretary of the Treasury, however, he was never made a member of Carter's "inner circle," and his responsibilities were never clearly defined, writes historian Burton Ira Kaufman.Kaufman, Burton Ira. The Carter Years, Infobase Publishing (2006) p. 47 Although he was made chair of Carter's Economic Policy Group (EPG), and was Carter's chief economic policy official, he was still unable to chart economic policy or be recognized as the administration's chief economic spokesman. He instead had to share the role with those closer to the president, which caused confusion among outsiders and weakened Blumenthal's effectiveness.
Blumenthal took an active role in fighting inflation, which had increased from 7 percent at the beginning of 1978 to 11 percent by the fall. By the summer of 1979 inflation had reached 14 percent, with unemployment in some cities running close to 25 percent. Much of the increase had to do with OPEC raising oil prices. During this period, the U.S. dollar was also a target of one of the largest currency speculations in history by countries including Germany and Japan, whose currencies were rapidly appreciating against the dollar.
In February 1979, Blumenthal represented the U.S. in its first visit to China by an American Cabinet officer following America's official recognition of their Communist government, which China had proclaimed in 1949. Until that time, most American China scholars had never been to China, and the event was so newsworthy that twenty journalists traveled with Blumenthal and his staff. His experience living in Shanghai is considered to have been an important factor in Chinese leaders inviting him, instead of a State Department official. His trip was a great success, notes biographer Bernard Katz. Blumenthal also went back the following month for the opening of the U.S. Embassy. He explains: