Only when society had “succeeded in abolishing the empirical essence of Judaism—huckstering and its preconditions” would “the Jew . . . become impossible.” In fact, the socialist argument could stand unsupported by racial prejudice, as Marx came to appreciate (after all, he himself had been born a Jew, as had Karl Beck); it would be other revolutionaries of 1848 like Richard Wagner who would later develop and refine this line of argument. Either way, the Rothschilds were extremely vulnerable to radical calls for redistribution of wealth and greater regulation of the capitalists/Jews who possessed it. This made the 1848 revolution much more dangerous to them than that of 1830.
Though politically close to Marx at the time of the 1848 revolution, Heine subsequently made fun of the early socialists’ motivations. In his last jottings, he wrote:
The main army of Rothschild’s enemies is made up of have-nots; they all think: “What we don’t have, Rothschild has.” They are joined by the main force of those who have lost their fortune; instead of ascribing their loss to their own stupidity, they blame the wiles of those who managed to hold on to what they had. As soon as a man runs out of money, he becomes Rothschild’s enemy.
And he adapted a traditional Jewish story in order to provide James with a possible reply to the socialist threat: “The communist . . . wants Rothschild to share out his fortune of 300 million francs. Rothschild sends him his share, which comes to exactly 9 sous: ‘Now leave me alone!’ ” In practice, however, it did not prove quite so easy to see off the threat of expropriation. In his first surviving letter (dated 1843), a young radical named Wilhelm Marr had made exactly the argument satirised by Heine. “The time is ripe,” he told his father, “to share Rothschild’s property among 3,333,333.3 [sic] poor weavers, which will feed them during a whole year.” The roots of Marr’s later Anti-Semitic League lie in the 1840s.
A few voices, as we have seen, were raised to defend the Rothschilds. One ingenious writer in the Paris Globe pointed out in 1846 that “no one today better represents the triumph of equality and work in the nineteenth century than M. le Baron de Rothschild”:
What is he, in fact? Was he born a Baron? No, he wasn’t even born a citizen; he was born a pariah. At the time of his birth, civil liberty, and even less political liberty, did not exist for Jews. To be a Jew was to be less than a lackey; it was to be less than a man; it was to be a dog that children chased in the street, hurling insults and stones. Thanks to the holy principle of equality, the Jew has become a man, the Jew has become a citizen; and once his intelligence [and] his activity . . . allowed, he could rise within the social hierarchy. What better or more incontrovertible evidence could there be that the principle of equality has prevailed? Yet it is democrats who close their minds and eyes to this spectacle! Nominal democrats, no doubt. Sincere democrats would have applauded this Jew who, beginning at the bottom of the social ladder, has arrived by virtue of equality at the highest rung. Was this Jew born a millionaire? No, he was born poor, and if only you knew what genius, patience, and hard work were required to construct that European edifice called the House of Rothschild, you would admire rather than insult it . . . You tactlessly cite Figaro, without understanding that Figaro was one of the privileged by comparison with M. de Rothschild, since Figaro had only to be born in order to see before him the vast and open battlefield of labour. At his birth, M. de Rothschild found this battlefield closed to him and yet he has, aided by freedom, climbed higher than you. To abuse M. de Rothschild is to blaspheme against equality.
Yet such reminders of the Rothschilds’ origins in the Judengasse were rare in the 1840s. Only in England, where the issue of the parliamentary representation of the Jews was to play such an important role throughout the revolutionary period, did it really seem relevant. The continental revolutionaries did not think of the Rothschilds languishing in the Judengasse, but imagined them luxuriating in châteaus like Suresnes and Grüneburg. In Joseph Eichendorff ’s allegorical comedy Liberty and her Liberators, for example, Amschel is once again satirised in the character of Pinkus, a self-made “cosmopolitan” (misheard by a page as Großhofpolyp) who acquires the title of baron and with it a castle and garden. Pinkus cannot abide Nature, preferring to impose strict uniformity (complete with steam engine) on the garden; whereas Libertas wishes to set the plants, birds and animals free. When she tries to do so, Pinkus has her arrested by his “armed forces”; but the spirits of the primeval forest come to her rescue, throwing Pinkus’s repressively ordered garden into chaos.
The Rothschilds were far from oblivious to the animosity they were incurring. Indeed, it might be said that they took positive steps to counteract it by making generous—and ostentatious—charitable gestures. In the very dry summer of 1835, Salomon offered 25,000 gulden towards the construction of an aqueduct from the Danube to the Vienna suburbs. When Pesth and Ofen were badly flooded three years later, he hastened to offer financial assistance for the victims. He donated 40,000 gulden to found an institute for scientific research in Brünn. And when Hamburg was ravaged by fire in 1842 he and James made substantial donations to the fund which was set up to assist the victims. Before the 1830s the Rothschild brothers’ charity had been largely confined within the Jewish communities of Frankfurt, London and Paris. Now Salomon made a point of contributing to causes which were regarded as good by the Habsburg elite. Baron Kübeck recorded in his diary how the elite responded. At a dinner for Count Kolowrat in 1838, Salomon declared expansively that his guest’s presence had:
“given me as much pleasure today as if I had been given a thousand gulden, or had given them to a poor man.” Thereupon Count Kolowrat replied, “Very well, give me the thousand gulden for a poor man who needs help, and has applied to me.” Rothschild promised to do so and after dinner Count Kolowrat was given the thousand gulden.
So frequently did Salomon act in this way that it was possible for a sentimental novella of the 1850s to portray him as a kind of Viennese Santa Claus, benignly siding with a carpenter’s daughter who wants to marry her rich father’s gifted but poor apprentice. The high point of this mawkish work is a description of the throng of Schnorrer in the antechamber of Salomon’s Renngasse residence: the man who claims to be God’s brother-in-law (he is sent packing); the man who wants Salomon to be the godfather to his child (he gets 50 gulden); and the woman whose five-year-old daughter can recite seventy-two poems from memory (whose reward is not recorded). That they are all drawn to the house of Rothschild is explained not just by his wealth, but by his universally acknowledged wisdom and generosity. At one point, genial old Rothschild even delivers a homily to a young Frankfurt banker on the need for those who are rich to be generous.
It may well be that this was the way Salomon wished to be regarded. But not everyone who came into contact with him would have endorsed this characterisation. Moritz Goldschmidt’s son Hermann—a boy in the 1840s—remembered him as an impetuous, impatient, despot: “a brutal egoist, a man without wisdom or education, who despised those around him and took the opportunity to treat them ruthlessly [just] because he was rich.” He ate and drank to excess. He was habitually rude to everyone from his barber to the Russian ambassador and surrounded himself with sycophants. He had a lecherous passion for “very young girls,” his “adventures” with whom had to be hushed up by the police. Above all, Salomon was extravagant. He habitually dressed in a blue suit with gold buttons and nankeen or white stockings and, when he needed a new suit or hat, bought twelve at a time for good measure. He drove around Vienna in a luxurious carriage with a liveried servant. In 1847—in the depths of the economic slump—he spent immense sums building a new residence and office in the Renngasse. To be sure, Goldschmidt was looking back in anger when he wrote; but his hostility towards Salomon was probably not so different from that felt by many of his more politically radical contemporaries.
The Frankfurt Rothschilds too sought to allay popular hostility by acts of public benevolence. In May 1847 Amschel distributed bread ration cards to the poor of
Frankfurt at a time of acute food shortages in the town. But, although he received “a unanimous vote of thanks” from the Frankfurt Senate, this does not seem to have done much to enhance his popularity. As his nephew Anselm observed when his uncle raised the possibility of buying British grain for the German market, “We must be very careful in Germany about corn; there were a great many riots all & everywhere against corn dealers, & if the public would know that we are indirectly interested in corn transactions there might be a burst out [sic] against us.”
Perhaps the most successful gesture of public-spiritedness at this time was made by the English Rothschilds in response to the catastrophic potato blight and famine in Ireland—the worst of all the calamities of the 1840s, which cost the lives of around 775,000 people and drove a further two million to emigrate. Ireland was not a land with which the Rothschilds had many dealings; yet as early as 1821, hearing rumours of an impending famine there, Nathan had alerted Lord Liverpool to the possibility of buying “American and East India Rice before speculators come into the market, the price of which is at present low and the Stock large and which in case of a deficiency of the Potato Crop would supply the numerous Poor of that Country with a wholesome food during the Winter.” When Peel used the Irish famine twenty-five years later to justify repealing the Corn Laws (thus freeing the import of grain into the British Isles, but also bringing down his own government) the Rothschilds were ambivalent. While Alphonse viewed Peel’s conversion to free trade “without admiration” as an “utter revolution,” his father “very much regretted” Peel’s fall—though probably more for the diplomatic implications of Palmerston’s return to office.
Lionel, by contrast, was a thorough-going Free Trader; but he understood that free trade alone would not alleviate the famine in Ireland, because of the general European cereal deficit. In the absence of a more than half-hearted official relief effort, he therefore took the lead in setting up at New Court the British Association for the Relief of the Extreme Distress in the Remote Parishes of Ireland and Scotland, which raised some £470,000 in the course of its existence—even soliciting a contribution from that ardent Hibernophobe and Protectionist Disraeli! The Rothschilds themselves contributed £1,000 to the fund, the second biggest donation after the Queen’s £2,000 and on a par with the Duke of Devonshire’s. In this instance, contemporaries were sincerely impressed by the Rothschild effort. As he declared to a friend, it did the heart of the future Liberal Irish Secretary W. E. Forster “good” to see “Rothschild, Kinnaird, and some dozen other millionaire city princes meeting every day, and working hard. A far greater sacrifice to them than mere gifts of money.” Lionel personally involved himself in “regulat[ing] the purchase and shipment of provisions to Ireland and the formation of depôts around the coast and in the interior of the country.” Though it is possible that this activity was partly designed to win Catholic votes at the 1847 election (in which he was a Liberal candidate), his mother’s letters on the subject testify to the sincerity of the family’s response to the Irish disaster.
The contrast with the Paris house’s role is striking. The French food crisis was, of course, far from being as disastrous as the Irish: as Nat wrote in 1847, “They talk terribly of the misery of the poor devils in the provinces but I don’t believe it approaches that of Ireland—it cannot be compared to it.” Nevertheless, the 1846 wheat harvest was an exceptionally bad one: 15 per cent lower than the average of the previous ten years, it was the worst since 1831. James first began purchasing grain as early as January 1846 in anticipation of a bad harvest throughout Europe. A year later he was urging the French government to make purchases of Russian grain, and in the spring of 1847 he offered “to buy abroad 5 millions of francs worth of corn and flour for the consumption of Paris at our risks & peril and in the event of any loss accruing we s[houl]d bear it & the profit to be distributed in bread tickets to the poor.” Besides being philanthropic, James genuinely feared the social and political consequences of food shortages: as he told his nephews in November 1846, “[T]he situation with our grain, which really isn’t good, does scare me a lot.” For this reason, there is no doubt that he wished to be seen to be alleviating distress—Salomon wrote explicitly of “making our name popular” with “the masses” by providing cheap bread and salt.
Yet James had meant the grain purchases only to be non-profit-making; he had not intended to lose money outright. His assumption in early 1847, for example, was that prices would remain high; and when the improved harvest that year partly confounded that expectation he and Nat could not conceal their annoyance. “There never was anything so stupidly managed as this corn operation,” grumbled Nat: “to buy up all the corn in the world & to get it just as the harvest is coming on, we shall lose a great deal of money & in future we shall be more careful.” This may partly explain why James received little if any credit from ordinary consumers in Paris. As Nat had predicted, “I fancy the philanthropic feelings of our good Uncle will cost a little money. If people don’t attribute a wrong motive it will be all very well & charitable, but in Paris where nobody can imagine anything done disinterestedly I should not be surprised if it were said we do it for the sake of getting rid of what we have got at very high prices.” Violence of the sort which broke out in the faubourg Saint-Antoine in May 1847 was partly directed against grain merchants; James was widely perceived to have acted as little more. Indeed, it was rumoured that Rothschild bread was laced with ground glass and arsenic. Here perhaps was the origin of Heine’s imagined Rothschild nightmare: “He dreams he gives 100,000 francs to the poor and becomes ill as a result.”
What made the agrarian crisis doubly worrying for the Rothschilds was its impact on the European banking system. All countries which found themselves obliged to import grain from relatively remote markets like Russia and America experienced a drain of gold and silver which had a direct impact on their monetary systems. The most dramatic case was that of Britain. The effect of the shift to free trade was to increase immensely the import of corn to Britain, from 251,000 tonnes in 1843 to 1,749,000 tonnes in 1847. The success of Peel’s policy was thus not in reducing the price of bread, but in averting what would have been a very substantial price increase if the Corn Laws had remained in force. But the policy had an unexpected side-effect on one of Peel’s other great legislative achievements, for it forced the suspension of the Bank Charter Act of 1844. It did this because the act had reinforced the link between the Bank of England’s gold reserve and the British money supply. As corn imports flooded in and gold flooded out, so the reserve dwindled: from £15.8 million in 1844 to £9.8 million four years later. The Bank was obliged to increase its interest rates in steps from 2.5 per cent (March 1845) to a peak of 10 per cent (October 1847), thus causing a drastic monetary squeeze and finally forcing suspension. No other European economy permitted such a large outflow of specie; but Britain’s financial dominance of the continent at this period ensured that the contraction was felt everywhere. Only the grain exporters were spared, which partly accounts for the very different Russian experience in this period.
First to suffer was Frankfurt. As early as April 1846 Anselm reported: “The volume of business in Frankfurt is more and more shrinking, without a downpour of gold from heaven, I do not know how this place can recover”—a verdict echoed by James when he visited in July. Soon came the inevitable casualties, this time uncomfortably close to home. In 1847 the house of Haber collapsed, threatening to take with it the Beyfus brothers’ bank. As two of Mayer Amschel’s daughters (Babette and Julie) had been married to the Beyfuses, it was felt necessary to bail them out—to the tune of 1.5 million gulden—though this was done with extremely bad grace. The younger generation in London and Paris had little time for “old Mad Beyfus.” “If we are to pay because they chose to swindle,” complained Nat, “the Lord knows to what interest they may draw upon our cash box . . . the only regret I experience is that our worthy relatives have thought it fit to come to their assistance.” In fact, it seems
to have been James who insisted on rescuing “so near a relation,” despite the grumblings of Amschel, Salomon and Carl—a good illustration of his ultimate leadership on familial matters at this time. Yet the fall of the Habers—to whom the Beyfuses were also related by marriage—attracted much more attention than the survival of the Beyfuses. Once again, there were articles in the press “attributing to us the ruin of . . . German industry.” “These attacks were so violent,” wrote Anselm, “that we found ourselves compelled to answer these libels by a declaration signed by us and inserted in the principal papers of Germany.” In the Bade nese parliament, a liberal deputy denounced the Rothschilds in terms which, Anselm reported, “aimed at nothing less than mobilising the masses in a religious crusade against our House, representing it as a vile monetary power . . . sitting [on] . . . all the kings, all the peoples.” It was even alleged that Lionel had agreed to bankrupt South German industry in return for a promise from Palmerston of a seat in the House of Commons.
Banking crises have a domino effect: the problems of Haber served to exacerbate the difficulties of one of the major Vienna banks, Arnstein & Eskeles. Trouble had been brewing in the Vienna market since early 1847, prompting Metternich to request Salomon to return urgently from Paris “to contrive some plan which would ward off the crisis of the market.” By the end of September it seemed that he had succeeded in “averting” an “immeasurable calamity.” However, the failure of Haber proved to have potentially disastrous implications for Eskeles, whom he owed 1 million gulden. It may be that Salomon was already heavily committed to Eskeles, with whom he had acted in close partnership for many years in issuing Austrian government bonds. Alternatively, he felt morally bound to intercede on his behalf. At any event, he informed the Frankfurt house on December 23 that Eskeles had
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