The House of Rothschild, Volume 1

by Niall Ferguson

  It is not wholly surprising, in view of the decisive role they played in so many post war financial transactions, that the Rothschilds first became famous in the 1820s. Even as early as 1816 Carl was conscious that he and his brothers were becoming “very famous” in their home town. As he told James, “these days a lot is written about us in consequence of the freedom of the Press.” He encountered similar publicity when he visited Berlin later the same year. Carl evidently felt uneasy about such celebrity, not least because of the inaccuracy of much that was written. “We are every day in the news,” he complained to Amschel. “Last week you were mentioned in the papers in connection with the poor . . . Today you are mentioned in connection with grain, and that you are going to become [the Elector of Hesse-Kassel’s] Minister at the Diet of the Confederation.” It was the same in Hamburg:

  Whenever any one of us arrives gossip and marvellous stories are spread by people. Lawätz told me that at some party in town the story was told that the King of Prussia wrote to us asking to arrange a bond issue of three millions. We are supposed to have replied that this was not necessary, because we were able to advance this sum from our own money.

  Amschel too was struck by the public propensity to exaggerate: “People think that we are ten times as rich as we really are.” “Wherever we go now,” Carl found, “people think it is a political trip.” The arrival of James at the St Petersburg stock exchange, or of a ship chartered by Nathan in port, was enough to bring business to a standstill. James had only to buy a certain security in Paris for “everybody” to buy it. Unlike Carl, the youngest brother relished this new-found fame. As he told Nathan, “It is indeed nice to possess so much prestige.” “They all say: ‘Il n’a jamais existé à Paris une maison aussi fameuse que la nôtre.’ . . . We are now regarded as the first . . . I sent last week [bills for] three millions to the Banque de France. There was a lot of rubbish among them—yet not a single one was returned.”1 Salomon and Nathan too could make light of publicity. “We are not going to cry about the fact that you have been caricatured,” he told Nathan. “As you say, so are kings and emperors . . . May God grant that this is the worst thing that ever happens to us . . . May my Anselm and your Lionel also be caricatured, please God, as soon as they become well known in this world. I wish this for our darling children . . . [Idle] dreams!” Nathan’s attitude was typically robust: “Gagesh [nobody] is not being written about.” Press interest—including unsubstantiated claims that they were in financial difficulties—was merely the price of success.

  Public Relations

  As the brothers’ comments suggest, little of this publicity was good publicity. From the very earliest years of their fame, the Rothschilds were subjected to markedly more vilification than glorification in the public sphere. Of course, most monarchs, politicians and other public figures in the early nineteenth century occasionally found themselves held up to ridicule in newspapers, pamphlets and other media, especially in those parts of Europe where censorship was lax. But the Rothschilds often seemed to attract a specially intense form of criticism. One reason for this was their religion. To those who regretted the steps taken towards religious equality in the Revolutionary period, the fact that the most economically successful family of the Restoration era was Jewish was an inexhaustible source of irritation. However, other factors undoubtedly played a part, and it would be a mistake to equate anti-Semitism with anti-Rothschildism. A good deal of the hostility which the brothers encountered after 1815 can be attributed to plain economic rivalry. The other Frankfurt bankers, for example, would have been envious of the meteoric rise of the Rothschilds even if they had not been Jews. Moreover, some of the Rothschilds’ most determined opponents were other Jews—as in Kassel. Additionally, anti-Rothschildism had a political dimension: their identification with conservative regimes and the policy of the Holy Alliance made them targets for liberal criticism. The bad publicity of the Restoration era was therefore often a synthesis of economic envy and religious antipathy, with an admixture of political radicalism.

  In Frankfurt, for example, the Rothschilds’ emergence as a financial great power threatened to eclipse the Bethmanns, hitherto the town’s pre-eminent bankers. Simon Moritz, the dominant partner in this period, viewed his own relative decline with remarkable and indeed admirable equanimity; of all their many rivals, he yielded with the best grace. As early as September 1815 he actively sought to work in partnership with Salomon and James, observing in a letter from Paris to his own house in Frankfurt, “The more contact I have with the two Rothschilds here, the more confidence they give me.” Although he did not pretend to like Nathan’s “audacity and vanity,” he insisted that he was “far from wanting to criticise or envy” the Rothschilds, and described Salomon as “a very estimable man of character, to whom I am sincerely well disposed.” He even referred to Nathan as “our fellow countryman.” “The five Rothschild brothers are a remarkable phenomenon of our time,” he wrote in February 1822. “What they lack in genius they make up for with relentless activity, an enviable unity and mutual consideration.” However, such remarks were partly informed by Bethmann’s awareness that the best place to be in the 1820s was on the Rothschilds’ coat-tails. His mood changed markedly when he found himself left out of the 1821 Neapolitan loan, in which he believed Carl had promised him a share. “I do not think it fair,” he wrote angrily, “that I should commit myself to you for a period of months, while you find it suits you to retain the option whether you will keep your offer open or withdraw it.”

  Such complaints about the Rothschilds’ ruthless methods were nothing new: it had been the perennial complaint of the Gentile business community in Frankfurt that the Jews’ business methods were “unfair.” Early German caricatures of the Rothschilds emphasise this point: in I. Nussgeig’s Musterreiter, Carl is portrayed as “Blauschild,” a travelling pedlar heading south to Italy with his bedraggled pony bearing all kinds of wares, including muskets and swords.2 A later caricature contrasts the elegant figure of Bethmann, riding his coach-and-four in fashionable apparel, with a scruffy and grotesquely ugly Amschel, standing atop a large cash box which a two-headed eagle struggles vainly to pull forward.3

  As in the past, such business rivalry also had a political dimension. The fact that the Rothschilds were now “richer than Bethmann” was widely seen as evidence of the need to restore the traditional legal restrictions on the Jewish minority. In Amschel’s words, it “irked the Gentiles that a Jew should set the tone.” Hostility was growing daily, he reported in September 1815: “They begrudge us Jews the eyes in our heads . . . [and want] to drink our blood.” Matters were not helped by the fact that other Jews were inclined to boast about the Rothschilds’ wealth as a matter of communal pride, something which Amschel and Carl felt only fuelled Gentile resentment. This resentment generated a spate of anti-Jewish pamphlets and plays in the post-war years—the best-known was Unser Verkehr, about a cowardly Jewish soldier—and finally boiled over in the so-called “Hep” riots of August 1819, when a noisy crowd rampaged through the Judengasse, chanting the traditional anti-Jewish slogan “Hep-Hep! Jude verreck!” and vandalising houses. A good deal of this hostility was specifically targeted at the Rothschild family. In 1817 noisy crowds had gathered outside Amschel’s newly acquired garden, itself a symbol of Jewish social mobility, to mock his even more recent ennoblement, “chanting ‘Baron Amschel’ and all sorts of stupidities.” Caricatures were pinned to his door and the Rothschilds’ office windows were among those broken during the “Hep” riots.4 At around the same time, Amschel received death threats.

  Such demonstrations—which prompted Amschel to contemplate leaving Frankfurt altogether—do much to explain the Rothschilds’ ambivalence about popular political participation. When Metternich expressed his disapproval of the riots (a disapproval which, of course, extended to all “outbreaks of the vulgar masses”) he did much to reinforce the Rothschilds’ sense that conservatism might offer them more personal security than the more radic
al forms of liberalism. This was especially true in Germany, where traditionally the Habsburg Emperor had given the Jews “protection” from the local populace and where the proto-liberal associations of the Restoration era espoused a nationalism which was occasionally anti-Jewish in its rhetoric. At the same time, the closer the Rothschilds drew to the established order, the easier it was for its critics to identify them with it. When marriage between Jews and Gentiles was legalised in Frankfurt—one of a number of minor concessions wrung from the Frankfurt Senate in the 1820s—the eighty-year-old Goethe was moved to comment:

  This scandalous law will undermine all family sense of morality, intimately associated with religion as it is. When this is passed, how can a Jewess be prevented from becoming Principal Lady of the Bed Chamber? Who knows whether or not bribery has played a role in all this; who knows whether or not the the all-powerful Rothschilds are behind it?

  If so august and enlightened a figure could express such a view, it is no wonder the Rothschilds were content to see popular participation in German political life kept to a minimum.

  Anti-Rothschildism was not confined to Frankfurt. Wherever the Rothschilds secured a large proportion of government business, local rivals often reacted with religiously-tinged attacks. In Vienna, for example, the 1820 lottery loan which Salomon arranged in tandem with David Parish was widely criticised as “a shameful Jewish ramp” because of the substantial profits the bankers stood to make. Sometimes, it should be stressed, such attacks had no religious dimension. Six years later it was Parish himself who directed one of the most vitriolic blasts against the Rothschilds of the entire period. Parish had gradually been surpassed by his erstwhile partner: by 1823 he was the junior partner (if not the messenger boy) in Nathan’s loan to Portugal, and his eclipse was completed by the 1825-6 crisis, which claimed Parish’s Viennese bank Fries & Co. as one of its victims. On the eve of drowning himself in the Danube, Parish wrote four letters—to his brother John, to the banker Geymüller, to Metternich and to Salomon himself—all blaming his downfall on the Rothschilds and pledging to discredit them publicly. Metternich, said Parish, had “sacrificed me to the cupidity of a family who, for all their riches, are heartless men who only care about their cash box.” He had been “deceived” by Salomon “in the most shameful way and rewarded for very considerable service with the blackest ingratitude.” The strong implication was that the Rothschilds had secured Metternich’s “protection” and left Parish out in the cold by underhand means. Parish’s letters show that it was perfectly possible to be anti-Rothschild without being anti-Jewish. Yet few German journalists could resist alluding to the family’s religion when reporting such stories. A good example is Friedrich List’s newspaper report of a minor case of embezzlement by a clerk at the Paris house in 1826, which referred quite gratuitously to “Rothschild, the pride of Israel, the mighty lender and master of all the coined and uncoined silver and gold in the Old World, before whose money box Kings and Emperors humbly bow . . .”

  The brothers encountered similar kinds of hostility in Paris as well. “It’s always a case of ‘The Jew has done too well, has done this, has done that,’ ” Salomon reported to Nathan in October 1815. These were the complaints of business rivals, who battled to elbow the Rothschilds aside in the scramble for post-war pickings in the French capital. Ten years later, by contrast, James found himself the target of a primarily political critique. The liberal Fournier-Verneuil’s Paris, published in 1826, contains the first of many French claims that the government—in this case Villèle’s—was the corrupt puppet of “the aristocracy of finance, the most unfeeling and ignoble of all aristocracies” at whose head stood none other than “M. le baron R.” Fournier quoted Chateaubriand (an unlikely ally for a liberal): “How hard it would be if Providence had shaken the world, thrust the heir of so many kings under the [guillotine’s] blade, led our armies from Cadiz to Moscow [and] chained Bonaparte on a rock, simply in order that MM. Villèle, Rodchild [sic] and company can make money with the debris of our glory and our liberties.” Even this struck Fournier as understating the problem, however:

  The Jew R. and his co-religionists . . . see in the kingdom of the heavens no more than . . . money devoted to usury . . . It is a singular race of men; I am not intolerant, but Napoleon, in calling together the grand Sanhedrin [Jewish assembly] did not create a [new] Frenchman. They . . . are still Jews, and nothing but Jews. I do not hold it against them that they retain their faith; but I reproach them for profiting from all quarrels, for charging them up; they are everywhere. They were in Poland on the corpses of our brothers; they are [currently] supplying Ibraham [Pasha], and they are dancing at this very moment on the tomb of Achilles.

  The references to the Ottoman oppression of the Greeks make the author’s liberal sentiments obvious. Equally evident, however, is an anti-Jewish rhetoric which would only later come to be located on the political right. Fournier’s was in many ways an embryonic version of that elaborate conspiracy theory which was to evolve and expand for years to come in France, and which almost invariably ascribed a central and malign political influence to the Rothschilds.

  In London too—where anti-Jewish feeling is often assumed to have been less prevalent—the 1820s saw a spate of more or less hostile public allusions to Rothschild power. Indeed, the volume of such allusions was probably greater in London than anywhere else—a reflection partly of Nathan’s relatively greater importance, but also of the freedom of the press. Again, hostility often had its roots in business rivalry. If the rivals were both Jews—as when Mocatta & Goldsmid denounced “the overwhelming attempt of Mr Rothschild to benefit himself at the expense of any person or establishment”—this could be acrimonious without having a religious dimension. But when Alexander Baring referred to his principal rival, it was often (disdainfully) as “the Jew.” According to Laffitte, it was explicitly on religious grounds that Baring sought to exclude the Rothschilds from the French reparations loan in 1817. Although James tended to think this was merely a pretext, he acknowledged that a measure of prejudice was at work:

  In Frankfurt one got used to [it] so one is not astonished [there], but here the case is the contrary and if something of this kind happens here, one is more amazed . . . Yesterday Laffitte asked me to come and see him. Baring came to see him and gave clear explanations that he could not possibly make [the loan] with us. True, he himself was not of the same opinion [but] his associés and the English . . . are prejudiced against the Jews. If he were to take us in partnership, the operation would be spoiled. He is unable to do such a business with a Jew . . . It all originates in Labouchère’s pride and in Sillem’s envy; as these two are Hope [& Co.], they think that their honour would suffer if they had to get in line with a Frankfurt Jew and that we would become great by that fact . . . Baring told him: “These gentlemen are working like Jews. How could we co-operate? Their principles are different. They are working on twenty transactions at the same time . . . with the only aim to do business. It is like stock-jobbing. Take for example the Prussian business. They cut off Prussia’s credit . . . then this printing [of circulars] before anything is known.” . . . He added that we are right in what we did because we succeeded and made money. However, he does not want—so he said—to do business in this manner. Now we try—so he said—to bring down the English stocks after having sold ours, in order to buy them back.

  It was the Rothschilds’ (very successful) methods, in other words, which Baring found objectionable; but he instinctively thought of these as “Jewish” in character. Such attitudes were widespread. Devotion in Dukes Place, one of the earliest English caricatures thought to be of Nathan, shows him at the front of a Jewish congregation in the Great Synagogue “returning thanks for a loan.” (see illustration 5.i).

  As elsewhere, however, there was also a political dimension to anti-Rothschildism. The Rothschilds, as we have seen, often worried in the post-war years about the extent of Baring’s political influence in London and Paris, seeing this as the
key to his dominance of the post-war reparations business. To less influential businessmen, however, it was the Rothschilds who seemed to have the political power. As early as 1818 an anonymous member of the stock exchange wrote to Lord Liverpool, attacking Nathan for his opposition to the resumption of cash payments:

  Let me inform you, the Capitalists of Money Market . . . have set their faces against your Plan because it serves not their purpose or puts Money in their Pockets. The Jew interest alias Mr Rothschild are . . . straining every nerve to defeat your objects . . . If a Man asks Mr Roth-schild, what is his opinion of the Funds, he answers they must be better and at the very same time he acts contrary[;] [that] in so great a country as this, Your Lordship and Colleagues should be the Sport [&] the caprice of a Jew Party . . . is truly lamentable.

  5.1: Devotion in Dukes Place—or Contractors returning thanks for a Loan (1818).

  A cartoon of 1824 made a similar allusion to Nathan’s role in the debate about resumption, portraying Nathan rising above the stock exchange in a balloon. Although the balloon is held aloft by a bull and a bear and carries the inscription “Everything must rise,” it is held down by ballast labelled “Cash Bags.” Here too there is a religious allusion. Indeed, the most striking feature of this cartoon is the ambiguous way it portrays Nathan’s relationship to a group of poorer Jews. Nathan holds two flags, bearing the mottoes “Those who give to the poor lend to the Lord” and “Charity covers a multitude of sins”; but he says: “I am going to receive my Dividends,” and a figure on the left, emerging from Capel Court with a copy of The Times, exclaims: “We stop the press to announce that one of the greatest capitalists in the City has gone on a secret Financial Expedition.” The six poor Jews on the right—labelled “The Old Stock reduced”—are left to direct their lamentations to King, the guard of the Royal Mail coach, who is carrying a Way-bill bearing eight Jewish names, each of which has been allotted a shilling.