by Ron Chernow
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The Austrian Anschluss heightened pressure on the Roosevelt administration to offer a haven for Jewish refugees. To deal with at least the cosmetics of the problem, Roosevelt convened an international conference on refugees in the French resort town of Evian on Lake Geneva in July 1938. Attended by representatives of thirty-two countries, this conference was long on noble resolutions but short on deeds. Its one notable achievement was to create the Inter-Governmental Committee on Political Refugees. Headquartered in London, it would be directed by George Rublee, an American lawyer, with strong backing from Lord Bearsted and Anthony de Rothschild. Rublee found FDR less than ecstatic about the whole venture. “My guess is that the President went along with the idea because he may have thought that some sort of a gesture was necessary to assuage the indignation excited by the persecution of the Jews, but without any real hope of success in improving the lot of the Jews in Germany.”17
Rublee’s activities ended up revolving around a plan offered by Dr. Schacht to ransom the German Jews. It was an intellectual cousin of the plan peddled by Max Warburg for years. Schacht’s plan foresaw a sizable confiscation of Jewish property, whereas Max’s plan was designed to preserve Jewish wealth. Negotiations occurred at the end of Schacht’s Reichsbank reign. In September 1938, he had secretly plotted with General Ludwig Beck and others to seize Hitler in the Reich Chancellery and bring him before a state tribunal. Both Beck and Schacht thought Germany fatally unprepared for the war that Hitler contemplated against the Western powers. When Neville Chamberlain and Édouard Daladier agreed to attend the Munich Conference, the crestfallen conspirators grew dejected and abandoned their scheme.
On his way to America in September 1938, Max met with Rublee and Lord Winterton at the British Foreign Office. He said the German government would consider a deal permitting a mass exodus of Jews in exchange for a boost in German exports. He also alluded to a recent visit to the Foreign Office in Berlin in which he had expounded a plan to export fifty thousand Jews a year.18 Hence, Rublee wasn’t surprised when Berlin sent out feelers about just such a plan in October, with Schacht the moving force. Schacht wanted to impound a quarter of all remaining Jewish assets in Germany as collateral for a large dollar loan that Jews abroad would extend to the Nazis. The collateral would finance German exports to pay off the loan. Over a three-year period, the fund would resettle 150,000 Jews and superintend the departure of 400,000 people from Germany and Austria.
That November, when Kristallnacht threatened to derail these negotiations, Schacht shrewdly turned adversity to advantage. He openly denounced the November atrocities, telling his Reichsbank staff, “I only hope that none of our office boys took part, then for such people there is no room at the Reichsbank.”19 Schacht said that if Jews couldn’t safely conduct business in Germany, the government should help them to leave. According to Schacht, Hitler was sufficiently upset by foreign reaction to Kristallnacht to inquire, “Have you any suggestions?”20 Schacht won Hitler’s and Göring’s consent to pursue his transfer scheme in London, though he steered clear of Joachim von Ribbentrop and the Foreign Office.
Under camouflage of talks with the Bank of England, Schacht pursued his plan in London that December. He insisted that while awaiting their liberation, Jews still in Germany would be protected and elderly Jews allowed to die peacefully on German soil. Lord Winterton and Rublee reacted favorably to the plan and agreed to consult with financial experts, as well as eminent British and American Jews.
The political reaction recapitulated the controversy aroused by Max’s earlier plans. Chamberlain and Lord Halifax opposed any plan that might fortify the Nazi economy while FDR derided it as ransom for hostages.21 British and American Jews were again reluctant to submit to patent blackmail. They also objected to the proposed committee, which might seem to substantiate Nazi fantasies of a world Jewish cabal. Once again, the Jews, far from ruling the universe, hesitated to flex their muscles for fear of provoking a backlash. As Siegmund noted after a meeting with Lionel and Anthony de Rothschild, they shrank from any Anglo-American Jewish political bureau because “one can endanger his English citizenship, if one becomes too strongly active in Jewish world actions.”22 After Kristallnacht, nobody wanted to grant to Nazi Germany loans secured by seized Jewish assets.
While Max supported the Schacht negotiations, Siegmund cast a more dubious eye over the affair. With great ardor, he had thrown himself into refugee work. He would get distraught calls from people trapped in Germany then run around trying to raise money for them. Often he ended up helping them from his own pocket. He tried to coax German and Austrian refugees into setting up a job-training program and lobbied for expanded refugee camps. Checking his business ambitions for the moment, he subordinated everything to aiding German Jews. At one point, he was busily preparing applications for sixty refugees trying to enter Peru, Brazil, and other countries.23 Exhausted much of the time, he seldom arrived home before ten-thirty at night.
Moving in and out of Germany on business, Siegmund exposed himself to great danger and was never entirely sure that the Nazis would let him return to England. He was extremely worried about political developments in Germany. On August 16, 1937, he penned an eloquent letter that was to be read by Eva in the event of his death. Full of lofty exhortations to have faith in the final triumph of goodness, it also contained characteristic, sardonic touches on how to raise George and Anna. He asked Eva to provide for them “a quiet, peaceful, natural growing-up, free from the fuss of social to-do, breaking records and sport, free also from small-minded ‘time killing’ activity such as the restless driving-around of cars, sightseeing and all other ways of ‘passing the time’ (what a dreadful expression).” He paid tribute to their marriage but also honestly alluded to their difficulties, telling her, “please do not ever forget that at all times of our life together I have loved you so very dearly, as dearly as any human being can love another. And when we have come under a cloud, as intense people are wont to do, and our love has been overcast for a while, it has always come back into the light stronger than ever.”
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During this period, the marriage had indeed come under a cloud. An avid ballet-goer, Siegmund met Alexandra Danilova, a celebrated star of Diaghilev’s Ballets Russes, on a transatlantic liner. A product of the Imperial Theater School in St. Petersburg, she had left Russia with George Balanchine and lived with him as his common-law wife in the 1920s. When Siegmund met her, Danilova was in her early thirties, dancing with the Ballet Russe de Monte Carlo. She had an almond-shaped face with beautifully sculpted eyelids that made her a pensive Madonna in repose. So long and faultless were her legs that Lloyd’s of London would insure them for $500,000 in the 1940s. She had star qualities that must have won Siegmund: She hated fuss and pomposity; was stoically impatient with whining; had awesome discipline as a dancer; and conducted herself with a natural, unaffected dignity. She was Siegmund Warburg’s counterpart in the ballet world.
Siegmund approached her on the ship with characteristic premeditation, first inviting Danilova’s friend to dinner, then asking her to introduce him to the prima ballerina. Smitten, he wooed Danilova with the prodigious charm at his command. By the time they docked in Europe, they had arranged a rendezvous in Berlin, where she was scheduled to dance.
“Siegmund helped me to get into a beautiful hotel in Unter den Linden,” Danilova recalled. “He said, “You must stay in this hotel. It’s the best and I will see to it that you get in there. I was very thankful.”24 At a later date, Siegmund would be rigidly circumspect, but in this liaison he seemed heedless. In Berlin, he not only openly attended Danilova’s performances, but squired her to the opera and took her to dinner at a cousin’s apartment. With breathtaking devotion, he gave her an antique ruby ring, trimmed with tiny diamonds, that he told her had belonged to the Hapsburg dynasty. Later he added a blue sapphire brooch that she would always keep locked in her bank vault.
Enchanted with Danilova, Siegmund betrayed none of h
is volcanic temper or fickle, arbitrary moods. He was infinitely tender. “He was very nice to me, very warm and kind. He treated me with respect. He was easy to talk to and be with. Maybe it was easy for him to be with me because whatever he spoke I would know. He loved the ballet and he admired me as a dancer and a woman.”25
For Siegmund, Danilova must have brought laughter and brightness into a refugee life darkened by misfortune and dislocation. As for Danilova, she was touched and flattered by Siegmund’s gallantry and fell in love with him. Since they both had peripatetic lives—international bankers and prima ballerinas had that much in common—their itineraries frequently crossed in the coming year. They had many trysts, including a stay together at the George V in Paris; three days in Hollywood (Danilova insisting they travel there separately for discretion’s sake), and frequent visits at Danilova’s flat on Shepherd Market in Mayfair. To make sure no gossip circulated, she didn’t tell a soul about the romance for more than fifty-five years.
Nonetheless reports ran through the City about Siegmund’s rapt, faithful attendance at Covent Garden. Whether word filtered back to Eva through family channels or whether Siegmund finally admitted to his amorous escapade is unclear. Whatever the case, Eva decided that she didn’t intend to be a tolerant, two-timed wife. She suddenly took both children to Paris and forced Siegmund to make a choice. Fortified by her personal inheritance from the Philipsons, she didn’t have to truckle to him. Her family alibi was that George and Anna were catching colds in the London damp and needed a change of climate.
While Eva was in Paris, Siegmund visited New York and was summoned by Frieda, who told him that she was extremely fond of Eva and that he should do everything in his power to keep her. (Since Frieda tolerated Felix’s flings, it suggests the gravity of Siegmund’s plight.) During his time with Danilova, Siegmund had sidestepped all talk of family. “He never talked about his children or his wife,” said Danilova, whose second marriage to an Italian engineer, Giuseppe Massera, had by now ended. “He never spoke about them and I didn’t ask.”26 Warburg legend claims that Siegmund even considered divorcing Eva, although Danilova contends that she and Siegmund never discussed marriage.
Danilova knew the affair would end someday, ballerinas not being considered respectable mates for up-and-coming young bankers. She was also a supremely dedicated dancer, wedded to her career, and would never have renounced touring. Nevertheless, things were still rosy with Siegmund when Danilova got an unexpected letter. “He said that he couldn’t see me anymore. It was a very sort of official letter—like you say somebody’s service is finished. A banker’s letter.”27 The letter was conspicuously devoid of warmth or explanation, as if Siegmund needed to telegraph, with coldly irrevocable finality, that the affair was over. When Danilova wrote, asking to have lunch one more time, Siegmund never replied. It was said that when Eva returned from Paris, her dark hair had prematurely turned white.
Siegmund must have experienced tremendous struggle before sacrificing the alluring Danilova. This exquisite dancer was quite unlike anyone he had encountered even in his vast experience. An ambitious man, Siegmund must have known that divorce and remarriage to a ballet dancer would have tarred him, if not with a scandalous image, with an unwanted Bohemian one. Whatever the bargain he struck with Eva or with himself, Siegmund adhered to it, with iron fortitude, for his entire life. He did everything he needed to do to save his family.
Amazingly, Siegmund and Danilova never set eyes on each other again, even though she spent the postwar years in New York, later teaching at the School of American Ballet with Balanchine. Sometimes she wondered whether Siegmund had ever again come silently, anonymously, to see her perform. The circumstances behind his final letter would remain a lifetime mystery. She never had the consolation of an explanation nor anyone to grieve with. Of the family tempest stirred by the romance, she knew nothing. Like Siegmund, she had an uncommon capacity for keeping secrets. Even when she published her memoirs in 1988, she toyed with disclosing the episode, but stuck to her three husbands and her career. Siegmund would have appreciated such willpower.
More than fifty-five years later, Danilova would look back upon the aborted love affair philosophically, recalling it with sweet nostalgia instead of bitterness. “I was very hurt,” she said. “But I keep my big mouth shut. I never told anybody. He probably respected that from me. Maybe our romance was an escape for him to a completely different world. I was like a beautiful garden full of flowers for him. Maybe it was his caprice. Together we had fun which he probably needed. I understand that I had to take this out of my heart and not tell anybody, not even my girlfriends. I still remember avec tendresse the time that we get together and I understand later, how big he was. So I had to respect his wishes.”28 When told, as an old woman, of the reasons behind Siegmund’s letter, she expressed sympathy for Eva, saying she had been smart to force her husband to make a clean break. Either from guilt or discomfort, Siegmund emphatically refused to attend ballet in later years. He locked the experience away in some private compartment of fondly remembered but doubtless painful experience.
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Constantly worried about his mother, Siegmund pleaded with Lucie to abandon Uhenfels, now run by a Nazi superintendent, and come to London. But Lucie prided herself on her autonomy and still felt surrounded by decent people. She didn’t understand why she had to leave and, to Siegmund’s dismay, was stubborn about staying. “She said, ‘Everybody in the village knows me,’ ” recalled Siegmund’s cousin. “She felt protected and she also provided work to a lot of people.”29 But after Kristallnacht she no longer felt safe. In December 1938, Siegmund and Lucie sold Uhenfels for 150,000 reichsmarks—a substantial sum that couldn’t be extricated from Germany. As with other German Jews, the effective confiscation of her property made Lucie less attached to material things. After Siegmund fetched her in Paris and brought her to London, she lived with Siegmund and Eva much of the time; otherwise, she stayed in hotels, pensions, and other transient residences, refusing to own real estate again. The experience also made Siegmund more cerebral, less materialistic. Each year in the 1930s, he and his family moved to another apartment. Siegmund often told Eva that, at worst, they would spend their lives in a two-bedroom apartment.30 He had a taste for fine items but didn’t need them.
Outraged by British passivity toward the Nazis, Siegmund condemned Chamberlain for fondling the Nazi gangsters. He attributed this to misplaced guilt over Versailles and the anti-Bolshevist sentiment so shrewdly exploited by Hitler.31 After the Anschluss, he applauded the tougher tone taken by England and even began to fear warmongering in some British quarters.32 Persuaded that the salvation of German Jews far outstripped the resources of private philanthropy, he called for bold, decisive action by both the British and American governments.33
The Schacht mission to London disturbed Siegmund because it seemed more appeasement that would simply make the Nazis sneer at the weak, pliant Western democracies. “It makes no sense to appease the German government with friendly words,” he wrote, “when sharp remarks, such as those that Roosevelt recently made, are much more effective.…”34 It is unclear whether Max knew that Siegmund was trying to undermine the Schacht mission with timely warnings to key individuals. After meeting with Schacht in December, Lord Bearsted turned for an opinion to Siegmund, who warned that Schacht was considered suspect by the Nazis and was hence poorly positioned to conduct serious negotiations. As one who despised Schacht, Siegmund scoffed at any humanitarian motives behind his mission, asserting that “his activity in this matter above all serves the foreign exchange balance of Germany and thereby improves his own personal position with the Nazi government.”35 Siegmund interpreted the Schacht plan as another Nazi ruse to relax tensions before unleashing fresh and more violent assaults.
On January 2, 1939, Hitler called Schacht to the Obersalzberg for a report on the London talks. By this point, the Führer had lost patience with the niceties of neoclassical economics as well as Schacht’s consta
nt moaning about the inflationary repercussions of the Göring rearmament plan. “You don’t fit into the National Socialist picture,” Hitler told Schacht.36 On January 20, Schacht was cashiered from the Reichsbank, ending his bizarre marriage of convenience with the Third Reich.
This didn’t end the ransom talks. Göring assigned Helmuth Wohltat of the Economics Ministry to continue negotiating with Rublee in Berlin. In February 1939, Rublee resigned his post. Various secret talks apparently persisted through May, with the quiet backing of the Warburgs and Kuhn, Loeb, but they came to naught.37
As if still magnetically drawn back to Germany, Max and Alice crossed the Atlantic on the Queen Mary in July 1939. They took the waters in Vittel, France, smack amid the Maginot Line. Meanwhile, Eric sailed from Denmark to other parts of Scandinavia with friends and seemed to have a young lady on each Baltic island. The group seemed oblivious of impending war. Once again, Siegmund was prescient, convinced by spring that war was inevitable.38 That July, he and his associate, Harry Lucas, had a hand in a statement issued by Chamberlain in the House of Commons, which supported increased spending for refugees.39 Another British director of New Trading, Sir Andrew McFadyean, had protested to the Italian government the expulsion of German and Austrian Jewish refugees earlier in the year.
Max was mystified by the Hitler-Stalin nonaggression pact in August 1939 and further stunned by the onset of war. Luckily, Eric got his parents off the Continent by the last train and Channel boat back to England before hostilities broke out. He was standing in the American embassy in London when Neville Chamberlain declared war against Germany. After the first air-raid alarm, he strolled over to St. James’s Palace where the guards had suddenly traded their bearskin hats and ornamental uniforms for somber khakis. Eric suspected that this war would end the old aristocratic order left behind by the first war. He and his parents sailed to New York on separate crossings, aboard ships brightly illuminated to alert German attackers that they were neutral. Having driven them from Germany, the Nazis let the Warburgs cross the Atlantic in safety.