Joey Smallwood and the Rubber Boot Fiasco: Greed, Grift, and a Ghost Factory

Welcome back to another twisted tale of political dreams, dirty money, and the haunting remains of a factory that never stood a chance. Today, we’re diving into the story of how one man’s vision to industrialize Newfoundland spiraled into scandal, betrayal, and – let’s be real – some very leaky boots.

This is the story of The Superior Rubber Company Scandal – a plot involving a Premier with a God complex, a German swindler with Nazi-era connections, and a factory that promised prosperity but became a punchline.

Joey Smallwood had just dragged Newfoundland into Canada kicking and screaming, and he was determined to prove the skeptics wrong. His battle cry? “Develop or perish.” That sounds like something a Bond villain would say while building an evil lair – but Smallwood meant it.

He was obsessed with modernizing Newfoundland. And to do that, he needed factories, industries, and – crucially – people with money and big promises.

Enter: Alfred Valdmanis. A Latvian émigré who gave off strong con-man-meets-corporate-savior vibes. Smallwood hired him as Newfoundland’s Director of Economic Development. Together, they rolled out the red carpet to European businessmen. You want a factory? Great! We’ll build you roads, power plants, and hand over millions in government loans. Just pinky-promise you'll create jobs.

Spoiler alert: they did not create jobs. What they created was chaos.

The Rubber Boot Factory That Couldn’t

In 1954, a shiny new factory opened in Holyrood – Superior Rubber Products Ltd. Funded by a $1 million government loan, the goal was to manufacture rain boots and rubber wear. Premier Smallwood was so hyped, he told Parliament that this was gonna be a million-dollar-a-year operation.

The dream? 400 local workers, mostly women, churning out boots for fishermen and eventually the world. The reality? Defective products, abandoned equipment, and so much scandal.

The plant’s president was Ludwig Grube, a German investor. The manager? Max Braun-Wogau – also German. But within months, things were already falling apart.

Grube got arrested in Germany with $80,000 in unexplained cash. Braun-Wogau landed in a Swiss hospital, leaving the factory basically manager-less during its critical startup phase.

The boots? Garbage. Leaky. Overpriced. Retailers refused to sell them.

Follow the Money… Right Into a Black Hole

As if that wasn’t enough, it turned out hundreds of thousands of dollars were missing. A government audit found $200,000 had vanished into a New York bank account. Another wad of cash went straight to Braun-Wogau.

Meanwhile, Valdmanis – remember him? – tried to cover for his buddies by writing a fake affidavit to get Grube released. Smallwood was livid. He refused to get Newfoundland tangled in a German embezzlement case.

Then it got worse. Valdmanis himself was arrested in 1954 for extortion. Turns out he’d been demanding kickbacks from the very companies he brought into Newfoundland. He served two years in prison.

Joey Smallwood’s industrial dream? Crumbling faster than the concrete in Holyrood.