The Great Phenol Plot was a conspiracy during the early years of World War I

World War I

World War I , which was predominantly called the World War or the Great War from its occurrence until 1939, and the First World War or World War I thereafter, was a major war centred in Europe that began on 28 July 1914 and lasted until 11 November 1918...

 to divert American-produced phenol

Phenol

Phenol, also known as carbolic acid, phenic acid, is an organic compound with the chemical formula C6H5OH. It is a white crystalline solid. The molecule consists of a phenyl , bonded to a hydroxyl group. It is produced on a large scale as a precursor to many materials and useful compounds...

 away from the manufacture of high explosives, and instead use it to produce Aspirin

Aspirin

Aspirin , also known as acetylsalicylic acid , is a salicylate drug, often used as an analgesic to relieve minor aches and pains, as an antipyretic to reduce fever, and as an anti-inflammatory medication. It was discovered by Arthur Eichengrun, a chemist with the German company Bayer...

 and bring profits to the German

German Empire

The German Empire refers to Germany during the "Second Reich" period from the unification of Germany and proclamation of Wilhelm I as German Emperor on 18 January 1871, to 1918, when it became a federal republic after defeat in World War I and the abdication of the Emperor, Wilhelm II.The German...

-owned Bayer

Bayer

Bayer AG is a chemical and pharmaceutical company founded in Barmen , Germany in 1863. It is headquartered in Leverkusen, North Rhine-Westphalia, Germany and well known for its original brand of aspirin.-History:...

 company.

Background

At the outbreak of World War I in 1914, most phenol used by American manufacturers was imported from the United Kingdom

United Kingdom

The United Kingdom of Great Britain and Northern IrelandIn the United Kingdom and Dependencies, other languages have been officially recognised as legitimate autochthonous languages under the European Charter for Regional or Minority Languages...

. It was used to produce, among other things, Thomas Edison

Thomas Edison

Thomas Alva Edison was an American inventor and businessman. He developed many devices that greatly influenced life around the world, including the phonograph, the motion picture camera, and a long-lasting, practical electric light bulb. In addition, he created the world’s first industrial...

's "Diamond Disc" phonograph

Phonograph

The phonograph record player, or gramophone is a device introduced in 1877 that has had continued common use for reproducing sound recordings, although when first developed, the phonograph was used to both record and reproduce sounds...

 records (which were not made from shellac like other disc records of the time), the salicylic acid

Salicylic acid

Salicylic acid is a monohydroxybenzoic acid, a type of phenolic acid and a beta hydroxy acid. This colorless crystalline organic acid is widely used in organic synthesis and functions as a plant hormone. It is derived from the metabolism of salicin...

 used to make Aspirin, and the high explosive trinitrophenol. British phenol was soon being used almost exclusively for making explosives for the war effort, leaving little for export. By 1915, the price of phenol rose to the point that Bayer's aspirin plant was forced to drastically cut production; this was especially problematic because Bayer was instituting a new branding

Brand management

Brand management is the application of marketing techniques to a specific product, product line, or brand.The discipline of brand management was started at Procter & Gamble as a result of a famous memo by Neil H...

 strategy in anticipation of the expiry of the aspirin patent in the United States. Counterfeiters and Canadian importers and smugglers were stepping up to meet demand for aspirin, and the war had disrupted the links between the American Bayer plant (in Rensselaer, New York

Rensselaer, New York

Rensselaer is a city in Rensselaer County, New York, United States, and is located on the Hudson River directly opposite Albany. As of the 2010 census, the city population was 9,392; in 1920, it was 10,832. The name is from Kiliaen van Rensselaer, the original landowner of the region in New...

) and the central Bayer headquarters in Germany. Thomas Edison was also facing phenol supply problems; in response, he built a factory near Johnstown, Pennsylvania

Johnstown, Pennsylvania

Johnstown is a city in Cambria County, Pennsylvania, United States, west-southwest of Altoona, Pennsylvania and east of Pittsburgh. The population was 20,978 at the 2010 census. It is the principal city of the Johnstown, Pennsylvania, Metropolitan Statistical Area, which includes Cambria County...

 capable of manufacturing twelve tons of phenol per day. Edison's excess phenol seemed destined for American trinitrophenol

Picric acid

Picric acid is the chemical compound formally called 2,4,6-trinitrophenol . This yellow crystalline solid is one of the most acidic phenols. Like other highly nitrated compounds such as TNT, picric acid is an explosive...

 production, which would be used to support the British.

Plot

Although the United States remained officially neutral until April 1917, it was increasingly throwing its support to the Allies through trade, especially after the May 1915 sinking of the British ocean liner Lusitania

RMS Lusitania

RMS Lusitania was a British ocean liner designed by Leonard Peskett and built by John Brown and Company of Clydebank, Scotland. The ship entered passenger service with the Cunard Line on 26 August 1907 and continued on the line's heavily-traveled passenger service between Liverpool, England and New...

 (which contained American passengers as well as munitions) by a German U-boat

U-boat

U-boat is the anglicized version of the German word U-Boot , itself an abbreviation of Unterseeboot , and refers to military submarines operated by Germany, particularly in World War I and World War II...

. But while many Americans, including President Woodrow Wilson

Woodrow Wilson

Thomas Woodrow Wilson was the 28th President of the United States, from 1913 to 1921. A leader of the Progressive Movement, he served as President of Princeton University from 1902 to 1910, and then as the Governor of New Jersey from 1911 to 1913...

, supported the British, there was also considerable pro-German sentiment (though considerably less after the Lusitanias sinking). German ambassador Johann Heinrich von Bernstorff

Johann Heinrich von Bernstorff

Johann Heinrich Graf von Bernstorff was a German politician and the ambassador to the United States and Mexico from 1908 to 1917.- Early life :...

 and Interior Ministry official Heinrich Albert

Heinrich Albert

Heinrich Friedrich Albert was a German lawyer who served as commercial attaché to the Imperial German Ambassador to the United States Johann Heinrich von Bernstorff during World War I. He was also the paymaster for German espionage and sabotage operations in the United States...

 were tasked with undermining American industry and maintaining public support for Germany. One of their agents was a former Bayer employee, Hugo Schweitzer.

Schweitzer, with money funneled from Germany through Albert, set up a contract for a front company called the Chemical Exchange Association to buy all of Edison's excess phenol. Much of the phenol would go to the German-owned Chemische Fabrik von Heyden's American subsidiary; Heyden was the supplier of Bayer's salicylic acid for aspirin manufacture. By July 1915, Edison's plants were selling about three tons of phenol per day to Schweitzer; Heyden's salicylic acid production was soon back on line, and in turn Bayer's aspirin plant was running as well. Schweitzer sold the remainder of the phenol at a considerable profit, being careful to distribute it only to non-war-related industries.

Heinrich Albert, however, was under investigation by the Secret Service

United States Secret Service

The United States Secret Service is a United States federal law enforcement agency that is part of the United States Department of Homeland Security. The sworn members are divided among the Special Agents and the Uniformed Division. Until March 1, 2003, the Service was part of the United States...

 because of his propaganda activities. On July 24, 1915, he accidentally left his briefcase on a train; it was recovered by the Secret Service agent who had been following him. Albert's briefcase contained details about the phenol plot and other covert activities to indirectly aid the German war effort. Although it was not incriminating enough to bring charges against Albert or the other conspirators—since the United States was still officially neutral and trade with Germany was legal—the documents were soon leaked to the New York World

New York World

The New York World was a newspaper published in New York City from 1860 until 1931. The paper played a major role in the history of American newspapers...

, an anti-German newspaper. The World published an exposé on August 15, 1915, and the publicity soon forced Albert to stop funding the phenol purchases.

Schweitzer quickly sought other financial backers. By September, he had signed a deal (backdated to June to hide Albert's involvement) with Richard Kny, a relative of the Heyden plant's manager. This allowed the phenol plot to continue for a short while longer. By the time the plot was discontinued, it had succeeded in diverting enough phenol, according to Albert, to make about 4.5 million pounds of explosives. Schweitzer defended his actions on these grounds, arguing that making medicine and disinfectants was a better use of the phenol than making weapons. The public pressure soon forced Schweitzer and Edison to end the phenol deal—with the embarrassed Edison subsequently sending his excess phenol to the U.S. military—but by that time the deal had netted the plotters overs two million dollars and there was already enough phenol to keep Bayer's Aspirin plant running. Bayer's reputation took a large hit, however, just as the company was preparing to launch an advertising campaign to secure the connection between aspirin and the Bayer brand.