Among his many other achievements, Harvard Law School Professor Robert R. Bowie played a crucial but under-appreciated role in solving two of the great dilemmas facing postwar Europe. One was how to deal with the economic power of the giant German industrial concerns, organised into vertical and horizontal monopolies. These were centred in the Ruhr, where rich deposits of high-quality coking coal had fuelled a mining and metallurgy cluster. The region’s biggest enterprises owned coalmining operations, coking, smelting, steelmaking and machine-building companies. A good example of this model was the Krupp enterprise, which by 1914 was ‘an integrated empire of coalmines, steel factories, and armament works, and had even branched into publishing and film-making‘. Krupp supplied Hitler’s armies with a huge share of the weapons they used to wage war, employing conscripted foreign workers, prisoners of war, and concentration camp inmates to do so. The industry of the Ruhr was the foundation of Germany’s economy and its military capacity in both world wars.

Closely related was the history of conflict between France and Germany over access to the mineral resources of the Ruhr region and the iron ore deposits of Lorraine. Along with other mineral resources in northern Europe (including Saarland, Belgium, and Luxembourg), these had been the object of wars, occupations, and annexations from the Franco-Prussian War of 1870-71 , through the First World War, the occupation of the Ruhr by France and Belgium in 1923-25, the remilitarisation of the Rhineland under Hitler in 1936, through to the end of the Second World War.

In early 1950, when the Allies were deadlocked over how to deal with these related problems, Jean Monnet, a French statesman with long experience in international diplomacy and trade, crafted a plan to pool the coal and steel resources of the Ruhr under an independent supranational body, which became the European Coal and Steel Community (ECSC). Monnet encouraged the French foreign minister, Robert Schuman, to propose the plan under his name in a radio address on 9 May 1950.

The proposal was to form a common market for coal and steel in Europe, administered by an independent supranational authority with the power to regulate trade in coal, ore, scrap and steel. Germany would enjoy full and equal membership status. All members of the community would have unimpeded access to the crucial resources they needed for their own industry; discriminatory taxes, transportation rates, and tariffs would be abolished. Monnet’s premise was that, by pooling resources, all members of the community would have a direct stake in the benefits of the expansion of trade. He believed that the new arrangement would ‘create the conditions for a common expansion with competition without domination‘. In turn, economic growth through economic integration would reinforce incentives for peaceful relations and end the historical pattern of zero-sum competition for natural and industrial resources in northwest Europe.

Monnet intended the plan to resolve the security dilemma that had long cursed Franco-German relations. In a personal letter to the German Chancellor Konrad Adenauer just before Schuman publicly announced the proposal, he wrote that the aim of the plan was not economic but political: it was intended to allay French fears that Germany would attack France once it recovered, thereby alleviating the corresponding sense of insecurity in Germany. In a memorandum to the French premier, Monnet explained: ‘Cette proposition réalisera les premières assises concrètes d’une féderation européenne indispensable à la préservation de la paix’ (This proposal establishes the first concrete foundations of a European federation essential to the preservation of peace). Monnet recognised that a lasting peace could only be based on an equal status for the two countries, while ensuring that the old cartel system, which had controlled the coal resources of the Ruhr and underpinned Germany’s industrial and military power, could not be revived.

For France, however, the price of preventing monopolistic cartels in Germany was prohibiting cartels and other abuses of trade dominance throughout the community. This set of compromises formed the package agreement on which the ECSC was founded. Both France and Germany would relinquish claims to sovereignty over the Ruhr, delegating power to the High Authority and entering the new community on equal terms, along with Italy, Belgium, Luxembourg and the Netherlands. Robert Bowie played a crucial behind-the-scenes role in making the agreement possible.

Monnet’s vision for the Schuman Plan could not be realised until Germany’s coal and steel economy was reorganised. As France and other European countries well understood, if German steelmakers were allowed to restore their monopoly on Ruhr coal, they could squeeze French steelmakers out, and rebuild Germany’s powerful industrial and military capacity. Germany was unwilling to dismantle its cartels unless full sovereignty was restored and equivalent anti-cartel provisions applied throughout Europe. But until Germany did reform its industry to a degree acceptable to the Allies, they refused to grant Germany full sovereignty and equality. The German government was resentful and unwilling to enact a law against cartels that left Germany’s industry at a disadvantage relative to French industry and that of other countries. Germany’s powerful industrial establishment pressed hard against Allied pressure and against Germany’s own liberal wing, which believed in competition as the core of a democratic market economy.

Therefore, solving the problem of the German steel cartels was a precondition for acceptance of the Schuman Plan. The American High Commissioner for Germany, John J. McCloy, called on Bowie to accomplish the task, hiring him as his general counsel. The Dean of Harvard Law School, Erwin Griswold, granted Bowie a year’s leave between January and December 1950, later granting a second year’s leave through to December 1951. Bowie was familiar with the problems of German and European reconstruction, having spent a year in Germany just after the end of the war as special assistant to General Lucius Clay, McCloy’s predecessor as High Commissioner.

Bowie succeeded in solving the cartel problem through patient shuttle diplomacy between Bonn and Paris. Under his plan, German steel firms would be allowed to own mines supplying no more than 75 per cent of their needs for coal supply. Germany’s 12 giant steelmaking firms were broken up into 24, but were spared expropriation. The coal companies were to operate independently and to sell the products at market prices. Adenauer accepted Bowie’s plan and presented it to the Allied High Commission, which approved it on 29 March 1951.

Shortly after he began negotiating with the German government on the terms of the decartelisation and deconcentration plan, Bowie also began working with Monnet, McCloy and the German government on drafting the terms of two articles of the treaty establishing the ECSC, the two articles that specifically dealt with competition law. Bowie himself later recalled that – ‘by chance’ – as he was working on the German reforms in spring 1950, the Schuman Plan was proposed: ‘And so I became heavily involved in trying to work out the relation between the deconcentration of the German coal and steel industry and the Monnet-Schuman proposal which was designed to provide a supranational framework for the coal and steel industry of Europe.’ The German problem and that of European integration were tightly interconnected: solving one required solving the other. It was Bowie’s handiwork that negotiated the package deal that resolved both problems. Less than two months after the High Commissioners accepted Bowie’s solution to the German cartel problem, the Treaty of Paris embodying the Schuman Plan was signed. The new organisation came into being in August 1952.

Meanwhile, in the course of that eventful year, Bowie was indirectly active in another, closely related and concurrent, legal issue: the development of Germany’s own anti-cartel law. This was probably the single most contentious problem in the Federal Republic of Germany’s early political history. Economics minister Ludwig Erhard, a staunch liberal, forceful personality, and adept politician, absorbed intense pressure from many sides. His allies in the Christian Democratic party were divided about the cartel issue. Some believed cartels necessary for the rebuilding of Germany’s economy. The industrialists’ lobby, represented by the formidable Bundesverband der Deutschen Industrie (BDI), fought tooth and nail to defeat legislation aimed at prohibiting cartels. Instead, they demanded a more familiar legislative approach, one that would simply prohibit abuses of market dominance (this had been the model of an ineffectual 1923 law under the Weimar Republic). The industrialists supported the goals of a ‘social market economy’ and European integration – but saw these as being best achieved through coordination among producers. The head of the BDI wrote to Erhard: ‘international cartels are shock absorbers’. It was inconceivable to them that their members be forced to face the harsh winds of free competition. As one of the member industrial associations wrote to Erhard: ‘It is not comprehensible that the Minister of Economics wants to lead and to force industry against its will to economic freedom.’

Bowie played a role in this fight. His demands, on behalf of McCloy, that Erhard push back harder against the resistance from industry fed the industrialists’ claims that Erhard was serving as an instrument of alien American legal ideas, but also gave Erhard ammunition to defend his position. Ultimately, long after Bowie had returned to Harvard, Germany did adopt an anti-cartel bill of its own, although the draft reflected the many concessions Erhard had to make to the industrialists in order to win its passage through the Bundestag.

Bowie’s field of expertise was antitrust law. Like Thurman Arnold and Louis Brandeis, Bowie believed strongly in its importance for a democratic capitalist society. In an article in the magazine of the American High Commission published in October 1950, he linked economic competition to democracy: ‘Both history and our own experience have convinced us that the survival and vitality of a democracy depend upon wide diffusion of power within the community… Thus, we Americans still believe in the Jeffersonian concept of wide diffusion of power, economic and political, among the masses of the people.’

For many Europeans, American antitrust concepts were alien. Industrialists almost uniformly opposed them.  Consequently, a competition law such as that represented by Articles 65 and 66 of the Treaty of Paris was a radical departure. Although the United States had enacted the Sherman Antitrust Act in 1890 and the Clayton Act in 1914, trade among European states had been dominated since the late 19th century by cartels, often international, controlled by powerful industrial and financial interests. The cartels enforced their own internal agreements, suppressing potential threats from outside challengers as well as from within their members, fixing prices and dividing markets. They benefited from government tariff, tax, and other protection.

The ECSC treaty’s innovation in rejecting the old model of integration through cartels was in delegating power to enforce the rules of trade to an independent supranational body. This was its High Authority, which for its first years was presided over by Monnet. As the High Authority gained legitimacy, it became the template for all the successive forms of European integration. The two articles dealing with competition law – the first banning monopolies, cartels, and anti-competitive behaviour, and the other banning abuses of market dominance – were the models for similar pairs of articles in each successive European community treaty.

Bowie’s role was recognised by only a few people at the time and since. We can appreciate it to some degree, however, by considering some of the tributes paid to Bowie upon his return to Harvard at the end of 1950. These were among the papers Bowie donated to the Harvard Law Library archives some years later. Two of them suggest how crucial Bowie’s role had been.

One is from a verbatim extract from the 82nd meeting of the Council of the Allied High Commission at Bonn-Petersberg, held on Thursday, 6 December 1951, as Bowie announced his departure from Germany. The transcript includes this comment by Acting French High Commissioner M.A. Berard:

It is quite remarkable that Mr Bowie not only held the confidence of the US High Commissioner, but had also the confidence of many German Ministers and moreover of a great many of French Ministers. It has happened to me to ask Mr Bowie what my own government’s instructions were because he knew them even better than myself. When the history of the Schuman Plan will be written, this plan will probably also be called the ‘Schuman-Bowie Plan.

A telegram from McCloy to Bowie the following May simply states: ‘Many thanks. It was a close squeeze and only the work you did in Bonn and Paris made it possible.’

Bowie himself, when he turned these materials over to the Harvard Law Library, included a handwritten note that reads: ‘Eschewing false modesty, they at least testify that a Faculty member was devoting his leave of absence to serious work!’.

It was no holiday. It is not too much to suggest that Bowie’s quiet work behind the scenes laid the basis for the peace and prosperity that Europe enjoyed in the postwar period.