The Warburgs

by Ron Chernow

  Siegmund had always thought that quantity could be harmful to quality in banking. With the Big Bank deregulation of London financial markets in the 1980s, Sir David Scholey transformed the firm into a vast, integrated securities house. Warburgs snapped up Rowe and Pitman, the Queen’s stockbroker; Akroyd and Smithers, a leading jobber; and Mullens, the government’s official broker. Siegmund’s aversion to stocks and risk-taking gave way to financial realities. The staff ballooned to five thousand people, operating in over thirty-eight countries. No longer the intimate adviser of Siegmund’s dreams, S. G. Warburg expanded eightfold in the decade after his death.

  With commendable finesse, Scholey managed to blend the four firms into a single culture, all imbued with the Warburg spirit. He knew Siegmund would have been uncomfortable with such changes, but believed his mentor would have recognized their need. By 1991, S. G. Warburg & Co. ranked as the biggest securities firm in Great Britain and the nineteenth largest worldwide. It claimed as corporate-finance clients half of the blue-chip firms in the Financial Times 100 index. It was a miraculous story of something imperishable created from the turmoil of central European history. Forty-five years before, S. G. Warburg & Co. had sheltered a handful of immigrants in a strange land. They had talked a foreign tongue and wondered whether they would survive. Now their firm had become the emblem of the City of London.

  CHAPTER 49

  ––

  A Town of Strangers

  Eric never lost the irrepressible vivacity that had withstood the Third Reich. He tried to resurrect his father’s world, right down to the fresh flower in his buttonhole. Like Max, he rose early to swim or walk in the Kosterberg park. Each September, he attended the annual IMF/World Bank meeting and made courtesy calls to David Rockefeller and other Wall Street worthies. He kept several secretaries busy in his corner office that had an Alster Lake view. On weekends, he painted delicate watercolors of maritime scenes. With his mischievous blue eyes and bow ties, he never lost his roving eye for pretty women. How had the shadowy history of German Jewry produced this sunny personality?

  Confronted with problems, Eric would ask, “What can be done?” A tenacious fund-raiser, he would tell businesses how much they should contribute to a charity. If he thought a donor stingy, he returned the check. As the carrier of family tradition, he strove to redress past injustices. In 1979, he went to see the antique collection of the Munich Glyptothek, which had six glass cabinets filled with Jim Loeb’s exquisite Greek figures. Eric persuaded the museum to post Jim’s picture and a short biography at the room’s entrance. He enjoyed the sudden vogue for Uncle Aby, as the Hamburg Senate voted to award a thirty-thousand-mark Aby Warburg Prize every four years.

  Eric clung to his Judaism by the most tenuous of threads. As the years passed, he felt more German than Jewish, and his Odyssey suggests what might have happened to the Warburgs if the Nazis had never come along. The family would have retained a real but attenuated Jewish identity that might have vanished in time. Where most Jews carried a ghostly map of Germany in their minds, flagged with prisons and death camps, Eric was able to screen out the past and simply pick up where he had left off in the 1920s.

  Thankful for the sanctuary he had found in America, Eric always tried to strengthen the German-American partnership. Along with John McCloy, he was a driving force behind the Atlantik-Brücke and its counterpart, the American Council on Germany. Studiously low profile, Eric seldom appeared in the German press, and reporters groused that it was easier to secure access to the Kremlin than to Eric. In 1979, he sailed to Denmark and Poland on the Warburg schooner, Atalanta, with his fellow Hamburger, Chancellor Helmut Schmidt. After one Bonn summit, Schmidt borrowed the ship for a two-day trip with French president Valéry Giscard d’Estaing. When Schmidt visited the White House in the 1980s, Eric stood by unobtrusively on the White House lawn as the Reagans greeted the chancellor. As the forgiving scion of a German-Jewish banking family, he was the ideal person to represent a chastened, responsible West Germany.

  In commenting on German anti-Semitism, Eric struck a concerned but cautious note. Never strident or militant, he also never let the issue fade and lectured newspaper editors who were insensitive on Jewish subjects. He would tell reporters that German youth couldn’t be blamed for the Third Reich. Then he would add—slyly quoting Kurt Hahn—that they had the privilege to blush at what happened.

  As Eric blended into the German milieu, some Warburgs found it commendable, while others found it bizarre and inexplicable. Eric was a thoughtful, good-natured relative, even if often twitted about his infatuation with German aristocrats. When he published his memoirs, Bettina teased him that he only seemed to know famous people.1 In 1970, on his seventieth birthday, Eric threw a big Kösterberg bash, inviting relatives from around the world. The Warburgs packed the fancy Vier Jahreszeiten hotel on the lake. For many, it represented their first return to Germany since the 1930s. It was a happy but uneasy time, for Hamburg inspired a hundred emotions of loss and anguish, nostalgia and bitterness. Outwardly the city resembled their birthplace, but one eerily depopulated of the people who had made it their city.

  Gabriele Schiff, Louise’s daughter, was mystified by Eric’s attachment to Germany and wondered in amazement, “How can he raise three children in Germany?”2 A short, plucky woman of considerable charm and intelligence, she had the Warburgian ethic of public service. Feeling guilty at having spent the war safely in America, she had returned to postwar Europe as a psychiatric social worker under the Joint’s auspices. She worked at a tuberculosis sanatorium in northern Italy and dealt with skeletal survivors from Bergen-Belsen. Then she was transferred to two rehabilitation centers in Germany crammed with masses of homeless Jews who clamored to leave a Germany that seemed accursed. During this first postwar return to Germany, she could not bring herself to visit Hamburg.

  ——

  Eric Warburg. (Courtesy of Anita Warburg)

  Gaby couldn’t conceive of forsaking America for Germany. “What I am—good or bad—I owe to this country,” she said of her adopted American home. “It would have been unthinkable to accept German nationality again.”3 In the 1950s, she took her husband, David Schiff (no relation to Frieda), to Hamburg to show him where she had lived. As she set eyes again on the Alster, she experienced a nostalgic twinge. But these echoes of the past only made her feel more keenly the loss and displacement of her generation of German Jews. By the second day, she had grown ill and had to leave. “A town in which you know nobody in the telephone book is no longer your hometown,” she said of Hamburg. “It’s an interesting, beautiful city, one of the most beautiful cities I know. But it’s no longer the city in which I was born.”4 Gaby’s mother, Louise—unlike twin brother, Fritz—had seldom returned to Germany from England, although she requested that her ashes be flown back for burial beside Dr. Derenberg.

  Eric’s youngest sister, Gisela, often pondered the baffling enigma of Germany. For her, a visit to Hamburg produced terribly confused feelings. Walking the Hamburg streets, she needed to remind herself that most pedestrians had not been alive in the 1930s or were only children then. Gisi had put up with much heartbreak. This avid organizer for Youth Aliyah never moved to Israel, as she had hoped. Yet she served on the national board of Hadassah, the Women’s Zionist Organization of America. Often she was disappointed with Israel, especially its treatment of West Bank Arabs. Dismayed to see Jews acting like conquerors, she cooperated with an interfaith group called Fellowship in Israel for Arab-Jewish Youth.

  An admirer of America, Gisi loved being in an immigrant country where every second person seemed to speak with an accent. She often visited Hamburg and sailed to Scandinavia with Eric as they had before the war. She never stopped thinking about the spectacularly rich and terrible history of the Jews in Germany. As she tried to locate the cause of anti-Semitism, she traced it to the church; to Jewish success; and to Jewish customs, such as eating kosher and not intermarrying, which had acted to keep Jews apart. If she sometimes wonde
red how Holocaust survivors could still pray to God, she never wavered in her own faith.5

  Of the four sisters, Gisi was most disconcerted by Eric’s return. She felt he was too quick to make excuses when Germany misbehaved, whereas any such intolerance merely confirmed her worst suspicions.6 In the 1950s, she traveled to Europe with her two children and stopped at Kösterberg. She watched her children climbing the same beech tree she had clambered up as a child and saw the old slow-motion passage of ships slipping by on the Elbe. It unnerved Gisi how much her children enjoyed Germany; it was like something that ran in the Warburg blood. When they got back to Boston, her son went around telling everybody that Germany had been his favorite place in Europe. When a thunderstruck Gisi confronted him, he explained, “Mother, the boys I played with know as little of Hitler as I do.”7 This was hard for Gisi to take because she herself had once loved Germany so much. “There are wounds that never heal,” she said of her feelings toward Germany. “So many frightful things happened. The feeling is as if a friend had betrayed you, and you never knew again, whether you could trust him one hundred percent.”8

  The murderous negation of Judaism by the Nazis had only deepened and enriched its meaning in Gisi’s mind. For her it was far more than just a religion. It was a land, a speech, a people. German Jews, she felt, had forgotten all this until they were so ruthlessly reminded by their enemies. “I sometimes think that perhaps Hitler, the mortal enemy of the Jews, also did something for the Jews. He forced them to recognize again, what history had taught them, but that they had forgotten in Germany: Judaism doesn’t mean only a community of faith, but also a community of struggle and a community of destiny.”9

  Like her sister, Anita was resilient and active in myriad organizations. She hadn’t stumbled into self-pity, but had gamely started over again, even if she often acted now as a fund-raiser instead of a donor in her charity work. She brought artists to America for the Institute of International Education, introduced UNICEF Christmas cards in Scandinavia, served on the board of the Mannes College of Music, and worked for numberless causes. Like Gisi, she felt the permanent scar of disenchantment with Germany. Whenever she visited Eric, she savored the beauty of Kösterberg, but felt incongruous, a specter from the past. Her home was on the Upper East Side of Manhattan, in a pretty apartment decorated with Japanese screens that the finance minister, Korekiyo Takahashi, had given her father long ago.

  Lola was less bothered by Eric’s return to Hamburg. “I can’t hate,” she said and never bore a grudge against Germany.10 Her Jewish identity was clear to her. Even on Eaton Square, she kept a kosher kitchen, attended synagogue on High Holy Days, and was dismayed when her two children married non-Jews. Though she visited Israel and raised money for Youth Aliyah, she too was critical of Israeli fundamentalism, especially after the invasion of Lebanon. She saw an erosion of the idealism embodied by Weizmann and the early Zionist leaders.

  With a good deal of the grande dame about her, Lola sometimes seemed like an aging movie star or an exiled queen. When she visited poor relations, she brought along a bottle of her own expensive gin. With age, the delicate face had grown lined and parchment-dry and her eyes stood out big and haunted, like a sibyl’s. Her voice steadily deepened from smoking unfiltered cigarettes. With her shaking hands, she scattered ashes everywhere, prompting fears that she would set the house ablaze. The old hand trembles got worse so that she had to command visitors, “Feed me, darling.”11

  Lola combined the fiery passion of Joan of Arc with the meddlesome curiosity of a Jewish mother. She had a touch of Siegmund’s imperious quality. In fact, there was mutual admiration—if also distrust—between these monarchs of Eaton Square. (Siegmund always gave to Lola’s charities, admiring her pluck.) Lola’s egoism never abated. Once sitting in the back of a lecture hall, she was asked by a friend if she didn’t care to move up to the front row. Lola drew herself up. “Where I sit is the front row,” she declared.12

  At age seventy-five, Lola still sped about town in a dark blue Triumph sports car. Because her hands shook, she was a menace to other motorists, yet she roared ahead. Making no concessions to age, she remained an incorrigible flirt with a magnetic allure for young men. Once, in her seventies, Lola was driving along an Israeli highway with a niece when she spotted a handsome young Israeli soldier hitchhiking. Abruptly she braked to a halt and started flirting with the young man, much to her niece’s amazement. It was a vintage Lola performance.13

  Lola and Rudolf maintained an air of marital amity. They would appear together socially and she provided a setting for his business entertaining. At the same time, Lola openly had her share of boyfriends. The strange ménage à trois with Kurt Hahn never ended. Lola and Rudo bought a house in Scotland called Burnside that wasn’t far from Kurt’s school, Gordonstoun. Kurt had his own room there. Lola ran Burnside with an iron hand, even assigning duties to amazed guests, and she organized Kurt’s life. When she visited Salem, Kurt invented tasks to keep the hyperactive Lola busy, lest he be worn down by her surplus energy. Right before she arrived, he would tilt every picture in the building to keep her employed. When Kurt had a nervous breakdown and grew paranoid, it was Lola who nursed him in her flat.

  Through Kurt, Lola became acquainted with the royal family. Prince Philip was one of Kurt’s favorite ex-pupils and sent his sons to Gordonstoun. Despite her liberal politics, Lola played shamelessly on her royal connection. One year, for her annual holiday cards, she reproduced a photo of Burnside with a swank car parked out front. The license plate clearly showed the royal chariot.

  In many ways, Lola metamorphosed into her father. Willful and charming, she had an exaggerated need for control. Her grandchildren couldn’t join her formal, candlelit dinners until age fifteen. She divided her elaborate social life into hermetically sealed compartments, because she didn’t want certain people to meet. Once she slammed the door in her granddaughter’s face when she had arrived ten minutes early for a visit.14 She liked to run people’s lives and would grill young men who wanted to marry her granddaughters. In fact, Lola grilled everyone, pumping even taxi drivers for their life stories. “Even in the hospital after major surgery, when she couldn’t speak above a whisper, she was still issuing orders like a sergeant major,” said a friend.15

  Thanks to Lola’s tenacity and his own willpower, her son Oscar lived a full life despite his polio. He went to Gordonstoun and Cambridge, then entered Rudo’s business, BKL Alloys. Funny and likable and a marvelous raconteur—if with a touch of Lola’s arrogance—he was involved in many activities from race relations to the Shakespeare Festival in Stratford-upon-Avon. Over the years, Lola’s motherly doting grew intrusive. At parties, she would sidle up to one of Oscar’s bachelor colleagues and ask, “Tell me candidly, does Oscar do a good job in the firm?”16 It was a fantastic blow to her when Oscar died. At once, with her highly developed organizational instincts, she began to plan his funeral arrangements, knowing that she had to stay active or she would fall apart.

  Notwithstanding Lola’s efforts to stop it, her daughter, Benita, married an Italian naval officer, Admiral Egidio Marco Cioppa. The bossy Lola didn’t beat around the bush with the admiral. “I beg you, don’t have a dozen children at once.”17 While Benita remained Jewish, the six children were brought up Catholic. In the end, the marriage to Admiral Cioppa was a long and happy one.

  Fritz’s daughter, Ingrid, also wrestled with her relationship to postwar Germany. In 1980, at Eric’s urging, she took her son, Oliviero, to the town of Warburg and other spots in Germany. Only among old friends and Resistance fighters could she find isolated traces of her homeland. For Ingrid, West Germany seemed a self-absorbed consumer society, overly preoccupied with order and security. After she and Oliviero stopped to see Eric at the bank, they dined on the Kösterberg terrace and gazed over the beech trees at the extraordinary river scene. The beauty of this mountaintop eyrie tugged at her with its old charm, its timeless grace. As she wrote, “When I think back to Kösterberg, to the view o
f the river from my window and the ships going by, traveling all over the world, including to my relatives in England and America, then this place strikes me even today as an island, a steady, secure frame of reference amid all confusion, like a little piece of eternity.”18 But her life was no longer there. The past had contracted into a handful of bittersweet memories.

  Even Jimmy Warburg, in his self-imposed exile from family matters, felt a subterranean pull from the distant past. He had never convinced Stevenson to join his solitary crusade to neutralize and reunify Germany. For Jimmy, postwar denazification had been a farce that allowed Germans to evade responsibility. He still found the Germans too passive, too reverential toward authority, and he was never especially impressed by German leaders. Of a 1954 visit to Germany, he wrote, “At several sessions of the Bundestag, I had an opportunity to observe the autocratic contempt with which the Chancellor treated the parliament. I made no attempt to see Dr. Adenauer, because I had known and learned to distrust him in my banking days when, as mayor of Cologne, he had tried to float an American bond issue.”19

  As ever, Jimmy was in headlong flight from his Jewish past. Jimmy’s third wife, Joan, came from a devout Congregationalist family and they sent their four children to a Christian Sunday school. Never a believer in organized religion, Jimmy told his children, “I do not object to your becoming Christians, if you become good Christians.”20 Already fifty-four when Joan had their first child, he felt he had been a father too early and too late in life.21