by Gay Courter
My eyebrows lifted at this news, but Edwin seemed to know all about it and asked simply, “Why?”
“Let me explain what happens next. None of us merchants want to give the crown more than we have to, thus we have a gentleman's agreement, called 'lot division,' designed to hold the price down. This ensures that we aren't bidding against each other and thereby inflating the price. If we were, the government could try tricks of their own: keeping some lots back to make a false shortage, flooding the market with poorer grades. As it is, one company bids for a lot at the lowest, fairest price—calculated to beat the reserve—and then it is split among the others by proportions determined previously, based on investment levels.”
“I see. Therefore, in order to even stay in the auction, one has to make an agreement beforehand for a portion of the lots.”
“That is correct, Dinah.”
“How is that done?” Edwin wondered.
“It isn't. The same dealers have controlled the business since my father's time. There is no reason to permit outsiders to change the system and enormous reason to prevent their success at all costs.”
“What did Uncle Samuel try to do?” I asked in a way I hoped seemed nonchalant.
“He had saved enough to buy a substantial number of lots. He wasn't foolish enough to bid for himself, so he hired an agent through a middleman. However, the secret could not be kept, and everyone knew that when the agent bid for a lot, Samuel's money was behind a portion of it. The others cleverly bid those lots up, not enough to seem unusual, but enough to make his the highest-priced chests of the day. Then they refused to lot-split. Your uncle was left with the most expensive opium. This would not have been so bad if he could have sold directly in China, but like many others, he underestimated what went on at the other end. There was no way he could manage without another middleman. This drove his price out of the range of the marketplace. He took a loss on every chest.”
“Poor Uncle Samuel.” I laughed. “How did he cover the losses?”
“He must have taken loans. He didn't come crawling to the family, at least not for money. There were some—I won't say who—that did not want him to stay in the firm afterward. Your Uncle Saul insisted he stay because the Sassoons had, not been harmed by his shenanigans and he had been taught a lesson. Since that time, Bellore has tightened the purse strings at Kyd Street and they undoubtedly have recovered.”
“Do you think he would attempt it again?” Edwin wondered.
“There is a difference between foolishness and lunacy.”
“Aren't there any conditions under which a new person could enter the opium market?” Edwin dared.
Unwilling to see my father's reaction to this confrontation, I focused my gaze on a nearby bush bursting with yellow roses.
Watchful as ever, my father straightened his back and swung his legs down from the settee. “Dinah!” As I turned toward him, he patted the cushion. “Dinah, come sit beside me.” Crooking a bony finger at my husband, he commanded, “Edwin, sit here too.” Once Edwin had slid into the other seat, Papa went on, “Yes is the answer to your question. If someone had considerable resources to throw into the wind, one could outbid for most of the lots at a single auction. Then, for a short time, the winner would control the price. If that company had agents in place to handle the shipping and sales in China, they might make a profit. One thing about opium is there is always an anxious group of customers on the other end Who are not willing to wait until the price drops before they buy. But where would that get the newcomer in the long run? To prevent a monopoly, the auctions are held frequently. With the money they had saved, the other merchants would rush in and buy up the next stock of chests. I would guess they would be so irate at what had occurred, they might try any number of tricks to hurt the upstart.” He squeezed my hand tightly and stared from me to my husband. “Listen to me, Dinah and Edwin, and listen well. I don't know what you two have been thinking, but you must never use your Luddy funds to try a run on the auction.
First, it won't work. Second, you promised the Luddy sisters you would leave their tea holdings intact. Third, you don't require more than you already have. And if that isn't enough, I shall have to remind you the last time you made an impetuous investment, it landed on the bottom of the sea—where much opium has also ended up, by the way.”
As he pressed my hand to his lips and kissed it, tears welled in my eyes. “I am a very sick man, Dinah. I cannot pretend that I will be around to protect you or the others for much longer. You can't imagine how much lighter my heart has been since Silas left you his shares. Promise me that you will be judicious in the future.”
“Yes, Papa,” I said, and Edwin nodded also.
He closed his eyes and leaned back against Edwin. “Is that a promise?” This question was directed at me.
I stared at my pitiful father. His cheeks were sunken, his lips parched. Only the husk of the vibrant man remained. “I promise to act responsibly now and in the future.”
His eyes flew open and met mine. I was able to hold them without flinching.
“Good.” He sighed.
Edwin stood up. “Dinah, we should let your father rest,” he said.
I didn't let go of his hand, though, for there was something else I had to say. “One more question, Papa. Do you think there will ever be an end to the opium business in India?”
“Everything ends sometime,” he said sadly. “But I can't envision it happening in my lifetime or yours. Last year the net opium revenue for India was more than ten percent of the total revenues from the colony.”
This sounded so similar to Edwin's apologies for the substance that I felt outnumbered. Didn't anybody share my scruples? “Wouldn't it be beneficial to some people if there was less available?”
“There will always be those who cry out in moral outrage, but the pragmatists who run the show will silence them.”
“Are you a pragmatist?” I asked softly, though I meant it as a rebuke.
“We Sassoons have always been beyond reproach in our dealings,” he said with a defensive retort.
Not in what they have dealt in, I thought to myself. My father sighed again. Whether he was allowing himself to meditate along the same lines as I had been or whether he was only tiring, I was not certain. Although he voiced no remorse, I had a sense there was some ambivalence—especially because of what had happened to my mother— he had never been able to express.
Zilpah was coming across the lawn. Knowing she was going to chide us for interrupting my father's rest, Edwin and I stood and said our good-byes. “One last word,” Papa added, barking a hoarse cough. “Remember, they may outlaw opium someday, but they will never outlaw tea.”
“I don't think we should go ahead with the plan,” I said when Edwin and I were alone.
“Dinah! How can we back down now?” “Very easily. We have not done anything irrevocable.” He switched on a lamp in our parlor. Since returning from Theatre Road, we had reviewed every point, looking for flaws. In the waning light of the day, my enthusiasm had also dimmed. “What are you frightened of?”
“You heard what my father said. I am afraid of failure.”
“We have agreed that the possible losses are within tolerable limits.”
“You have agreed. I have assented to nothing! Don't you recall what it is like to lose fifty thousand rupees?”
Edwin blanched, and I immediately regretted the outburst.
“For years I have borne the weight of that responsibility. Even today I am not free of the burden.”
I knew that was true. He never would have acquiesced to working for the Sassoons or suffered the indignities had he not been mortified by the loss.
“This time I know we are taking the right course.”
“My father doesn't.”
“He doesn't understand what we actually are going to attempt.”
“He came close, though, and he made me promise we would not go after a share.”
“No, you knew better than t
o do that. You promised you would act responsibly to guard your inheritance. And you shall—we shall. This time we are not betting the whole account. At most, we could lose a fraction of the cash assets. If the Luddy Tea Company does as well as it did the past five years, the income from the balance alone will support us grandly. What more do we need? Besides, if all goes as planned, we will have lost nothing and we will have rid ourselves of Samuel—and your Aunt Bellore—forever.”
“Aren't there less expensive, less risky ways to do that?” I asked in a shaky voice.
“Dinah, we've gone over this a thousand times.”
“We could tell my father about the embezzlement.”
“The malaria has severely debilitated him. It would be too much of a shock.”
“And this won't be?”
“A pleasant surprise could restore him.”
“And if it does not work the way you think it will?”
“Then he will have to be told. Besides, even if we did inform him or your brothers, you know as well as I what would happen: they would recover the money as best they could and bury the matter.”
“I don't agree.”
“I work with them every day and I know the way they think.” Edwin brushed off his jacket and stood authoritatively. “There is one other possibility.”
“What is that?” I asked, fired with the hope there was a course we had overlooked.
“Take the matter to court. A criminal case would accomplish what you want and there would be some justice in seeing your uncle— possibly even your aunt—in the dock.”
“Justice! There is no justice in the courts. My uncle would hire a bunch of slimy solicitors who would do anything—including bribery—to free him.” My voice lowered to a husky pitch. “There is no justice in the courts of Calcutta, or anywhere else probably. My mother was murdered by two men whose guilt was proved to everyone except the judge. There was evidence, there were witnesses, and still they were released.”
“What happened to them?”
“Dr. Hyam believes they went to Singapore or Macao. Once he heard that Sadka returned to Calcutta and was said to have even bragged about the crime, but that indiscretion forced him to disappear again.”
“Where are they now?”
“Who knows? Somewhere in the world Sadka and Chachuk are free. My mother never had a second chance. So don't tell me I should try to seek justice in the courtroom.”
“Dinah, you don't have to convince me.”
My arguments were crumbling. Was there no other choice? I gulped and added, “I thought we agreed that even at the largest estimate of what Samuel may have accumulated, he couldn't afford the reserve of even the lowest-priced chests.”
“Do you think it is a coincidence that he has been meeting with Indian moneylenders?”
As I looked up in astonishment, he smiled like a man holding the trump card. “How do you know that?”
“Gulliver has made himself useful to me in this matter. The list includes Shyamachurn Banerjee of the Agra Bank and Surroop Dutt of Tagore and Company. Why else would he be going to the Bengalis? You can imagine the terms he must be getting. Banks lend money to a credit society at six percent; the society then advances it to the moneylenders at ten percent; and if Samuel persuades the moneylenders, he'll pay in the area of twenty-five percent. His risk is enormous. Only if he corners the market and can set his price will he be able to. pay them back.”
“But my father said these raids won't work unless he also has the shippers and Chinese merchants in his pocket.”
“By now he must have a plan of his own. He's not going to repeat old mistakes. Perhaps he has hired the resources of one of our competitors, or perhaps he is planning a merger with one of them.”
“Is that possible?” I gasped.
“Yes,” Edwin replied resolutely. “We don't have a monopoly on China.”
“If he joined with someone else or put together strong associates, he could continue to parlay his gains this time into building another company, couldn't he?”
Edwin nodded morosely. “There is another possibility. If we lose our chance to make a profit this season, he could arrange to have almost the entire network of the Sassoons at his disposal. Don't you see? If Samuel owns the crop, he will control the market price. The gains he can make could be so enormous that he could do this again and again. In fact, he could end up commanding Sassoon and Company. We could all be working for him.”
45
Everything was in place. Or so I thought. We had studied the plan repeatedly, and though there were many eventualities we could not anticipate, we framed strategies to master any deviations. My folly was to have probed behind every door—except my own.
The evening before the auction, Calcutta was all pastels beneath the setting sun. Even the bustling throng along Free School Street seemed softer, more muted as I walked with Aaron, and Yali followed with a twin on each hand. Smiling at a pleasant breeze that ruffled the children's sun-streaked locks, I looked back toward the drab facade of Uncle Jacob's house. When this was over, my first task would be to find us a new place to live. Several possibilities near Grandmother Helene's appealed to me, or I might consider one of the large houses across from St. Xavier's, which would be convenient when the boys were older. Edwin might even want to teach there from time to time. The business had wasted his intellectual gifts. Now that there was no need for him to struggle, he should be able to manage some aspects of the Luddy holdings and devote himself to a more satisfying task.
What would I do? The tea business required my attention. After the lesson of Uncle Samuel's duplicity, I knew I had to take an active interest in the Luddys' enterprises. I wanted to make certain Silas' promotional ideas continued, and was pondering new tea blends for special markets. Did the Americans like brisk tea? I wondered. What did the Continentals prefer? We might travel and discover the various tastes, then tailor our product to suit the market instead of trying to sell what we had in stock. These thoughts danced about without choreography, for the main music in my mind was a replay of the last exciting days, when we had seen the pieces on the chessboard line up for tomorrow's checkmate.
First of all, Edwin had calculated how much cash my uncle had embezzled and had estimated between two and two and a half million rupees, or twenty-five lacs. Almost ten thousand chests were to be sold at the next auction. The reserve was figured at an average fourteen hundred rupees per excise chest. If the purchase price averaged close to the reserve, say fourteen-fifty per chest, the sale would gross over one crore, thirty lacs. In order to monopolize the price, Uncle Samuel would have to garner close to seventy-five percent of the crop. That was almost one hundred lacs. How could twenty-five buy my uncle a hundred? It couldn't. If he had bankers willing to lend him money until he made back his price, he would have to come up with only twenty-five percent of three-quarters of the crop. Amazingly, that figure was 2,501,250 rupees—a pinch over our estimate. With that calculation I was firmly convinced of his intentions.
In order to succeed, however, we required the support of the other merchants. After giving the matter careful thought, we decided not to meet each individually. Instead we would discuss the situation with Abner Raphael, head of the second-largest Jewish opium house. A close friend of Uncle Saul's and the Maghen David synagogue's principal benefactor, Raphael was among the most-respected men in the community. I myself had had a special fondness for the gentleman since the time my father first had been trying to find me a husband and Raphael had remarked, “If I had a son the right age, I would welcome your daughter into my house.” I hoped he would receive us in the same benevolent spirit when Edwin and I called at his home ten days before the auction.
“Your father, is he recuperating?” Abner Raphael had asked with a concerned expression after we were seated in his study. The man was not ten years older than my father, but his traditional Baghdadi dress and long beard made him look like portraits of my Sassoon forefathers: Moses, David, even Sheikh Sason ben Sal
eh.
I tried to put my awe aside and responded with confidence. “We hope so. The fevers are less frequent, but he requires complete rest. He won't return to China this year.”
“Who will go in his stead?”
“We are not certain. Possibly my brother Jonah, and Reuben's son Noah.”
“Nathaniel might be better,” he judged, stroking his creamy beard. “Is that what you have come about? Do you require advice on the China trade?”
“No, Mr. Raphael,” Edwin replied. He had remained in the background until he was required to bolster the argument, for he had said this was a favor that had to be requested by a Sassoon.
“Then to what do I owe this pleasure?” Raphael replied slowly. “Are you soliciting for a charity? I know of your family's estimable work after the earthquake and your own interests in helping in Darjeeling. I would be pleased to—”
I held up my hand and laughed uneasily. “Only if you consider Sassoon and Company a charity.”
“Indeed I do.” His eyes crinkled to slits as he guffawed. “The Raphaels have lost out often enough to feel we. have been giving to the Sassoons—albeit against our will—for half a century.”
I observed his expression carefully. There was no hint of hostility. The Raphael mansion was even grander than Theatre Road. This palatial residence next to the residence of Calcutta's commissioner of police included a private zoo that my children often visited. Their favorite creature was a venerable tortoise that must have given rides to every Jewish child. However, I could no longer trade on our friendship. The time had come to win Raphael with facts. Without any further preliminaries I told him what we had discovered, with me outlining the broad problem, Edwin reading from his notes on the details of the theft.
Raphael leaned farther and farther forward as the magnitude of the deception mounted. “A tragedy,” he clucked. “Samuel Lanyado! Who would have thought he could do such a thing?” He shook his head sadly. “Are you sure? Couldn't there be another explanation?”