The arrangement had been this. At the time of Ferdinand de Lesseps’ first campaign for a lottery issue, Herz had persuaded the old man and Charles to advance him the 600,000 francs for the good he could do them politically–the expenditure was entered in the company’s books under “publicity”–and to agree to a 10,000,000-franc payoff if and when a lottery bill was passed. The elder de Lesseps had even blithely agreed to give Herz a written copy of the secret agreement, which put the company pretty much at Herz’s mercy until 1887 when Charles recovered the incriminating paper and burned it.
Apparently the final 10,000,000-franc payment was to have been made through de Reinach, who was to take a cut for himself in repayment for money Herz owed him. But Herz had suddenly turned the tables on de Reinach. When the lottery bill was passed in June of 1888, the company refused to give de Reinach the 10,000,000 francs to give to Herz, the company’s position being that Herz had done nothing and so deserved nothing. Herz, who was then in Frankfurt, immediately informed the directors by telegram that de Reinach must “pay or be destroyed . . . I shall wreck everything rather than be robbed of a single centime; take warning, the time is short.”
So it was then that the directors turned over to de Reinach the check for 3,390,000 francs, which de Reinach took to the bank and converted into the various checks to “Bearer,” the two largest of which went to Herz. From that point on Herz had been blackmailing de Reinach, and thereby the canal company, for everything he could get.
What hold Herz had on de Reinach remained obscure, although there were innumerable theories concerning various dark secrets in de Reinach’s past, things so dreadful that he had been willing to go to any lengths to keep Herz silent. A favorite theory was that de Reinach had committed treason in order to advance himself socially or financially– the sale of state secrets to Italy possibly, or to the British Foreign Office–and that Herz had made it his business to know the details.
At one point de Reinach had threatened to expose Herz if he did not leave him alone, but it was a hollow threat. At another time, according to Louis Andrieux, de Reinach became so desperate that he hired an assassin to do away with Herz, a charge that was never substantiated or denied.
The story of de Reinach’s last night alive was revealed by degrees, beginning with an article in Le Figaro. On hearing of Ricard’s decision to proceed with criminal charges, de Reinach had rushed back from the Riviera, and on the fateful evening of November 19 he had gone to see Herz at Herz’s home near the Bois. But he had not gone to see Herz alone, the paper reported. There had been two others with him, Finance Minister Maurice Rouvier and Georges Clemenceau, whose mission was to plead for mercy in de Reinach’s behalf. When this side of the story broke, the response in the Chamber, and in the cafes, was a host of new theories about de Reinach’s death: he had been poisoned by Rouvier, by Clemenceau, by Herz.
Rouvier resigned at once. It was true that he had gone with de Reinach, he told his stunned colleagues in an emotional speech. It had seemed the humane thing to do; de Reinach was being driven insane by the newspapers and he thought Herz had the power to silence the attacks. The explanation satisfied almost no one, however, and the fall of a figure of Rouvier’s stature–he was the one brilliant financial expert in the government, as well as a former premier–sent shock waves through Paris and set off a panic on the Bourse.
Clemenceau told a similar story and without so much as a trace of remorse. It was at Rouvier’s urging, he said, that he had agreed to go along that night; Rouvier had thought it important. The conference in Herz’s study had been brief. De Reinach had been extremely agitated, “his face crimson and his eyes popping out of his head.” Herz had said it was too late to silence the papers; he considered the subject closed. Herz was perfectly cool and controlled, Clemenceau recalled, and wholly unsympathetic.
Later in the evening de Reinach went alone to see his nephew Joseph, then, still later, to see two young women whom he kept in respectable style in the Rue Marbeuf. Apparently he reached his own home about one in the morning and was found dead six hours later. The consensus in Paris was that he had taken poison and probably that is what happened.
It was Adrien Hebrard who informed Herz of the death, immediately after Hebrard had been informed by Joseph Reinach. So Herz knew before almost anyone and Herz departed for London that after-noon–that is, the afternoon of the Sunday before the arrests were made. On his way to the station he called on Andrieux to report that Joseph Reinach was “at work” on his uncle’s papers and could be trusted to leave nothing embarrassing lying about.
Herz was cause for torrents of invective in the Chamber, naturally enough. But Herz was out of the country and would stay there presumably, so in a large sense Herz was a straw man. The real target was Clemenceau.
How had such an individual as Herz, a foreigner, a quack doctor, risen so far so fast? In back of de Reinach was Herz, but who was in back of Herz? who was the powerful, unseen patron of “this little German Jew”?
“Now, this indefatigable and devoted intermediary, so active and so dangerous, you all know him, his name is on all lips,” exclaimed Deputy Paul Deroulede, self-appointed superpatriot and fanatic Boulangist. “But all the same not one of you would name him, for there are three things that you fear, his sword, his pistol, his tongue. Well, I brave all three and I name him: it is . . . Monsieur Clemenceau.” Instantly the Chamber became a shouting mob. One deputy jumped up and cried that Herz was an agent of the Foreign Office, a British spy. Yes, yes, Deroulede proclaimed, and Clemenceau had been his colleague.
Clemenceau responded with cold fury and looking directly at his accuser proclaimed him a liar: “Monsieur Paul Deroulede, vous en avez menti”
The inevitable duel followed, in a paddock at the Saint Ouen race track outside Paris on a chill, gray afternoon a few days before Christmas. Deroulede, tall and somber, stood bareheaded; Clemenceau, who was known as an expert marksman, kept his hat on. It was agreed in advance that photographers could be present and that dying words would be faithfully recorded. They each fired three times; they each missed three times. After the final volley, Deroulede was seen to examine a corner of his coat with “an appearance of apprehension.”
So by the year’s end, in the less than four months since Édouard Drumont commenced his disclosures in La Libre Parole, a government had fallen; three former premiers had been named in the plot, along with two former ministers and two prominent senators; more than a hundred deputies or former deputies stood accused of taking payoffs; there had been one probable suicide, a panic on the Bourse, a much-publicized duel. The sinister Herz had become a subject of worldwide fascination and there was the growing conviction that France had been the victim of a diabolic conspiracy.
About the only missing ingredient was a femme fatale and the suggestion of prominent government officials involved in illicit pleasures of the flesh. But then that also was added shortly by the Paris correspondent for The New York Times. In a long dispatch on the front page of the Times, January 15, 1893, appears a reference to the dazzling courtesan Leonide LeBlanc. It is not very much, only enough to imply a great deal, and there is no way either to verify it or to enlarge upon it. According to the Times report, “Her house in Paris was the center of the whole Panama intrigue and at her dinners these incriminated ministers, deputies, and editors met the cashiers of the rotten enterprise. She herself feathered her nest luxuriously out of the haul. . . .” She was also, according to the Times, “so braided up on every detail” of all that had gone on that nobody would dare say a word about her, and especially no one in the Chamber, “since more than half its members were guests under her roof [in] those lavish, hospitable days.” And as it turned out, no more was said of her.
III
Ferdinand de Lesseps remained unaware of events unfolding in Paris. Though somewhat improved physically, he passed his days seemingly oblivious of the world at large, wanting only peace. He had been removed from the city to the seclusion of his country
place, where Madame de Lesseps made certain that he saw no one who by some slip might give things away. Bundled into a double-breasted seaman’s jacket, a smoking cap on his head and a fur-lined robe over his knees, he spent hours staring into a log fire. Only on New Year’s Day when Charles failed to appear for the traditional family gathering did he become suspicious, demanding to know what had happened. He was told and the effect was devastating; but then he lapsed into the slow, silent decline from which he was not to recover.
The arrest at Charles’s apartment on the Avenue Montaigne had been handled with such discretion by the police that his wife was unaware of their presence. But like Marius Fontane, Cottu, and former Deputy Sans-Leroy, Charles was to be treated thereafter as if he were a dangerous public enemy. They were taken to the Mazas, the old metropolitan jail opposite the Gare de Lyon, and were put in separate cells. No visitors were permitted, other than their attorneys; the few times they were taken from the jail to testify in advance of the trials, they went handcuffed and under heavy guard, riding in the sort of van used to transport common criminals.
For Charles the ordeal was to be a long one. He would be tried twice, in two separate courts on different charges. The first trial was for fraud and maladministration, for “fraudulent maneuvers to induce belief in unreal schemes, and to raise imaginary hopes of the realization of a chimerical event.” The second trial was for corruption of public officials–political bribery. And since the elder de Lesseps was to be excused from appearing, because of his health and advanced age, Charles would bear the entire weight of the defense.
The first trial commenced in the Paris Court of Appeal on January 10, 1893, and lasted four weeks, two days.* On the eve of the first session the mood of the city was strange and unsettling. People by now, people of every political hue, were openly questioning the entire structure of French society. An atmosphere of general distrust pervaded the whole of France. “The situation in Paris grows more ominous day by day,” reported Smalley of the Tribune, There was talk of a royalist coup; military units near the city were kept on alert. The Italian ambassador informed his government that France was on the brink of revolution.
“Panama” had become a universal term of abuse, and, for many, a battle cry. On the night of January 6, La Libre Parole had staged a large anti-Semitic rally at the Tivoli Vauxhall. Jews had created Panama, exclaimed the main speaker, the Adarquis de Mores, and it was the Jews who were rejoicing now at the ruin of French honor. When several hundred spectators rose in angry protest (as the rest of the audience cheered wildly), a riot broke out. Chairs were smashed; people were beaten to the floor and trampled.
This was not the “real France,” the still-incredulous Smalley cabled New York. “The real France is the France of M. Pasteur,” he urged his readers to bear in mind. “. . . It is the France of Baron Alphonse de Rothschild, who makes the new year welcome to the poor by his gift of a million in charity. It is the France not of Panama but of the French who rejoice to think themselves . . . the one great republic of Europe.”
Large crowds gathered outside the beautifully wrought iron gates of the huge, gray Palais de Justice and an unmistakable air of apprehension filled the courtroom from the moment the prisoners were brought in. Perivier, the chief magistrate, and the four other judges and the prosecuting attorney entered in black robes and round gold-encrusted black caps. They were seated, the caps were placed on the benches before them, pencils were picked up, Perivier nodded to the clerk who then read the indictments.
Charles, the first witness, rose from the prisoners’ benches, a line of four folding chairs placed directly in front of the judges. Behind him, also standing now, was his attorney, Henri Barboux, who, like all others of his profession present, wore the traditional black gown and white, starched bib and collar of the avocat. Charles appeared in good health, even “full of energy,” despite a month in solitary confinement, but he would remain noticeably circumspect, even a shade pompous. He showed, as one reporter observed, little of the “elan that would have made him a more sympathetic figure.”
The others took their turn in due course: the gray, bookish Fontane, who appeared frightened and maintained that he had done only what he had been told; the impeccable Cottu, who nervously twisted a black mustache; Gustave Eiffel, vigorous in speech, handsome, near-sighted, whose lawyer was Pierre Waldeck-Rousseau, a future premier of France. Eiffel, though not imprisoned like the others, had been charged with making ill-gotten profits from a contract by which he had been guaranteed, among other things, an enormous cash advance and an enormous cash indemnity should the company fail to provide the necessary machinery for his locks within a ridiculously brief time. In the aggregate (as estimated by the Deputies committee), the company had paid out more than 74,000,000 francs to Eiffel, from which his profit had been tremendous. As an example, the indemnity paid on account of undelivered lock machinery was 18,000,000 francs, whereas his own outlay for such equipment amounted to less than 2,000,000 francs.
It would be said in Eiffel’s defense, however, even in the committee’s report, that the famous engineer had done nothing dishonest himself; he had merely had the advantage of a “curious” contract. Moreover, had the entire project been completed, the locks built, his profit would have diminished greatly.
In reply to questions from the bench, Eiffel said he had been deeply touched by Ferdinand de Lesseps’ call for his help, but that it was with de Reinach that he had entered into negotiations. “Oh, I hesitated,” Eiffel recalled. “I hesitated a long time.”
A decrepit old man from Nimes, a witness for the prosecution, who was deaf and nearly blind, gave a moving description of how he had invested the last of his savings in Panama upon seeing Ferdinand de Lesseps at one of the lottery bond rallies. Then four other similar “victims” were brought in by the prosecution, and the last of them, after telling the court he had been ruined, recalled that Ferdinand de Lesseps had personally counseled him to hang on to his Panama shares. “It is terrible,” remarked the chief magistrate. “Everybody here pities you.”
No witness questioned the good faith of Charles. Armand Rousseau pointedly dismissed all thought that Charles could have harbored fraudulent intentions. And since the political side of the scandal was not at issue in this trial and no political celebrities were paraded in to testify, Charles remained the central figure. His intention from the beginning, he said, had been to serve his father to his best ability; he was proud to have played that role and to have stayed at his father’s side to the end. He affirmed that Baïhaut, who also had been arrested by this time to await criminal prosecution, was paid to introduce the lottery bill and that de Reinach had been too. “You wasted the millions of your stockholders intentionally,” charged the prosecutor, a bald, fierce-looking man named Rau.
“With as much intention as one hands over one’s watch at pistol point,” Charles answered.
“And how did you understand that Baron de Reinach used these enormous sums?” Judge Perivier broke in.
“In remunerating financiers and, without doubt, senators, deputies, and ministers. Others also assisted de Reinach,” Charles said. He had taken care not to ask what was done with the money.
“That is, you gave them the dirty job which you preferred not to do yourself, but provided them with the means of doing!”
Charles made no reply and as the trial wore on he grew increasingly solemn and diffident. At times his voice was so low that only those in the first rows could hear him.
The prosecutor talked of “the greatest fraud of modern times.” Addressing the bench he exclaimed, “You will not hesitate to punish these criminals, who in order to attract millions have had recourse to every maneuver, every fraud . . . I demand the most stringent application of the law.”
The plea for Ferdinand and Charles de Lesseps, delivered by the small, white-haired Henri Barboux, was a classic example of nineteenth-century courtroom oratory lasting the better part of two days. With rolling phrase and mounting emotion, he c
alled upon the court to recall just who Ferdinand de Lesseps was, what he had done in his life, what he had meant to France, what he still meant in the hearts of millions, including those very people who had suffered most from the Panama failure. Hours passed, marked by a large, gilt-edged clock high on one wall. The longer he spoke, the greater the tension became. Imagine the response, he said, were the old hero to enter the room at this very moment to speak in his own defense, and much of the audience appeared to catch its breath, half expecting the rear doors to swing open at any instant.
How could his clients be charged with fraud when they had taken nothing to enrich themselves?* If they had miscalculated the expense of the undertaking, what great projects had ever cost what was originally estimated? His clients had never been alone in their faith that the great enterprise would succeed. The one sin Le Grand Français might be found guilty of was excessive optimism. But it was only the optimist who succeeded in this world. Pessimists were never anything but spectators.
The Court of Appeal passed judgment on the morning of February 9, the room “packed to suffocation.” The five defendants were found guilty as charged and the sentences were unexpectedly severe. Ferdinand and Charles de Lesseps were each sentenced to five years in prison and fined 3,000 francs. Fontane and Cottu were sentenced to two years and also fined 3,000 francs. Eiffel, though acquitted of complicity in swindling, was found guilty of misusing funds entrusted to him. He was sentenced to two years and fined 20,000 francs.
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