The Nuremberg circle smartly targeted moneylending as a way to contain Fugger and the new economy he was helping to create. They knew there was no quicker way to stop him than by turning off the cash spigot. Nuremberg is ninety miles northeast of Augsburg. Like Augsburg, it was a commercial city that reported to no one but the emperor. Nuremberg had Dürer and produced pocket-watch inventor Peter Henlein and globe inventor Martin Behaim. But Augsburg had Fugger, as well as Welser and Hochstetter, and was trouncing Nuremberg at the capitalist game. Nuremberg eyed it with envy. Civic rivalry might partly explain why Nuremberg school principal Anton Kress, shortly after Fugger paid the Hansa to leave him alone, wrote an essay condemning usury. Using words Fugger had heard before, Kress called moneylending unbrotherly and unchristian. Adelmann joined in and claimed that he had personally heard Fugger brag that “he had the pope and the emperor in his pocket.” At Adelmann’s urging, Pirckheimer fired a shot at Fugger by translating Plutarch’s condemnation of usury from Greek into Latin. “Wretched usurers,” Plutarch wrote, “preying on some poor and gnawing them . . . to the very bones.” In case anyone missed the point, he cited Homer, comparing borrowers to vulnerable Greek gods and usurers to vultures “piercing into their entrails with sharp beaks.”
Pirckheimer’s translation, only a few pages long, might seem like more of a slap than an upper cut. He was merely translating an obscure text from a language no one spoke into one that only a few spoke. But in the sixteenth century his translation was a blast from a blow horn. Intellectuals and other opinion makers worshiped everything ancient and welcomed any form of mental stimulation in a world with too little to read. They were soon buzzing about it. Fugger had to respond. With his support, Augsburg schoolmaster Sebastian Illsung wrote a defense of lending by focusing on the narrow subject of the Augsburg Contract—the legal agreement Fugger signed with depositors that promised them 5 percent. Illsung argued the contract was valid if the lender, like the borrower, risked bankruptcy. Then a young theologian named Johannes Eck caught Fugger’s eye by echoing Illsung’s arguments in a university lecture. Fugger asked Eck to write a dissertation on the Augsburg Contract and enter a debate—a public showdown with scholars as judges—to validate it.
Fugger was taking a risk. The Augsburg Contract may or may not have been legal under church law. But it was in wide use and Fugger needed it to raise money. If Eck lost the debate and the judges declared the contract usurious, Fugger’s depositors would refuse to give him money. This would be lethal. It was one thing to operate in a gray area. It was another to engage in a practice specifically ruled heretical. Fugger must have felt extremely confident because he sought nothing short of a Scopes trial, a winner-take-all smackdown pitting dogma against modernity, but with money instead of monkeys at the center. He had at least one precedent on his side. After theologians squared off over the subject of annuities—the interest-earning pension schemes that cities sold to raise money—the pope had sanctioned them. Maybe Pope Leo, who had replaced the “Warrior Pope” Julius II earlier that year, would do the same with the Augsburg Contract. There was also the fact that Leo was a member of the Medici banking family. Legalization would serve his personal interests. Even better was that Leo himself was a borrower of Fugger’s. It goes without saying that Leo would be favorably inclined towards someone who gave him money.
Eck taught at the University of Ingolstadt. He later became notorious for reporting Luther’s heresies to Rome and prompting his excommunication. He could advance his career if he won but faced ridicule if he lost. When Eck finished his paper, he submitted it to the university and asked it to host the contest. Universities usually approved such requests automatically, particularly when they came from one of their own. But the Nurembergers feared Eck would win. They pressured the school to refuse. After Adelmann accused Eck of being a Fugger stooge, the bishop with jurisdiction over Ingolstadt killed the contest. Other German universities refused, too. The topic was too hot. None wanted to be part of a discussion of potentially heretical views.
Fugger refused to quit and when Eck drafted a letter asking Leo to force Ingolstadt to hold the debate, Fugger signed it. After getting no word, Fugger and Eck turned to Italy where, thanks to Venice and Florence, the universities were open-minded about lending. They found a willing participant in the University of Bologna, Europe’s oldest university and among its most prestigious. Thomas Becket, Erasmus, Copernicus and Mirandola had studied there. On his way to Bologna, Eck passed through Augsburg. Fugger assigned him a translator and other assistants. Another Augsburger, the Dominican priest Johannes Fabri, made his own way to Bologna to argue the other side. For all we know, Fugger may have picked Fabri. It was a way of fixing the outcome. But Fabri appears to have been his own man.
On July 12, 1515, Eck and Fabri met at St. Petronius, the city’s mammoth fourteenth-century basilica. The doors opened at four in the afternoon. Eager for a good show, students and professors came to watch and walked past an enormous painting of a hideous, two-mouthed Lucifer—a reminder of what awaited heretics—as they took their seats in the pews. Organizers engineered these things to entertain. They allowed heckling and encouraged cheering. Eck and Fabri went at it for five hours. Eck avoided scriptural references and focused on intent. Only evil intentions could make a transaction usurious, he declared. A lender committed usury if he aimed to harm the borrower. But he acted legally if he had a legitimate business interest. When his turn came, Fabri rehashed the old arguments; Aristotle, Aquinas and the rest. Eck thought he crushed Fabri. Three professors in the audience agreed with him. But the judges saw merits on both sides. They refused to call a winner and the contest ended in an unsatisfying draw.
Fugger might have been disappointed, but he could take comfort. The judges had refused to call the Augsburg Contract heretical. Eck and Fabri had presented a cut-and-dried case of charging interest on loaned money, and had given the judges a perfect chance to confirm Luke 6:35. But the judges refused to make a call, a call that could have put Fugger out of business. That was tacit approval. What’s more, Fugger’s letter to Pope Leo had gotten through and made an impact. Leo ignored the question about debate venues but, in a decree issued that same year, Leo went to the heart of the matter and signed a papal bull that, in direct contradiction of Aristotle and other ancient commentators, acknowledged the legitimacy of charging interest. “Usury means nothing else than gain or profit drawn from such a thing that is by its nature sterile, a profit that is acquired without labor, cost or risk.” It didn’t matter that money wasn’t like a cow and provided no milk. Labor, cost and risk were enough to make it unsterile and make interest charges lawful. This was a thunderclap. Usury was a sin. But what defined usury? According to the new doctrine of the church, usury was no longer strictly about what Jesus said about charging interest. It was about charging interest without labor, cost or risk. And what loan didn’t involve one of the three? As long as a loan passed that easy test, the lender was off the hook. Fugger’s lobbying had paid off in spectacular fashion. He and others were now free to charge borrowers and pay depositors interest with the full blessing of the church. Leo’s decree, issued in conjunction with the Fifth Lateran Council, was a breakthrough for capitalism. Debt financing accelerated. The modern economy was under way.
Fugger and Eck stayed in touch after the debate, and, as we will see, Fugger later tried to bring him to Augsburg as a preacher. Eck also earned a spot in history by going to Rome and successfully persuading the pope to excommunicate Luther and issue the warrant for his arrest—an arrest that, had it been carried out, would have resulted in Luther recanting or burning at the stake. Contemporaries whispered that Eck went to Rome under orders from Fugger. Hard evidence is lacking, but the record shows that Fugger was an early opponent of Luther and wanted to protect the papacy and his business in Rome. He often dispatched Eck to do his dirty work.
After the usury debate, Fugger found himself under assault again, only this time in Hungary. Fugger had succeeded in Hungary
because he had it to himself. Other German merchants thought Fugger a fool when he bought his first Hungarian copper mine. They said if the Hungarian nationalists didn’t get him, the Turks would. For them, Hungary—where the Transylvanian count Dracula impaled Turks a generation earlier and displayed their heads on pikes—was too savage and unpredictable for investment. But the skeptics had been wrong for twenty years, and Fugger made a fortune mining Hungarian copper and exporting it around the world. What he didn’t export in raw form, he turned into weapons for sale to princes and popes.
Fugger owned several mines in Hungarian territory. His biggest was in Neusohl in Slovakia, 130 miles northeast of Bratislava. None of the Hungarian mines was individually as productive as Schwaz. But together they produced 1.5 million florins’ worth of profits over the years Fugger owned them. And that was just from copper. Fugger might have made just as much from silver but those figures are lost. More profits came from the guns cast in his Hungarian foundries. The money gave him a critical source of funds to loan Maximilian and others. Over his career, Fugger made more money in Hungary than on any other investment.
The outlook darkened in Hungary in 1514, when the Turks stepped up their attacks. They were looting more towns than ever and capturing girls to sell as slaves. To stop the Turks, Hungary appointed a Romanian warrior, Gyorgy Dozsa, to raise a peasant army and fight back. The Turks terrified the peasants and Dozsa easily found recruits. Once he had an army, he forgot the Turks and turned his forces on the Hungarian nobility and aimed to make himself king. The peasants hated the nobles even more than they hated the Turks. They jumped at the opportunity to attack the rich. In an early victory, Dozsa captured the fortress of Cenad and gave Dracula a nod by impaling the bishop. It looked as if Dozsa would overrun the country.
From Augsburg, Fugger tried to protect his Hungarian assets. He ordered Zink to bribe Hungarian priests to calm the peasants. He sent gifts to the Hungarian elite to win their favor. But he could only do so much. Help finally arrived when John Zapolya, Hungary’s largest landowner, raised a force. He captured Dozsa and used him as a grisly example of what happened to rebels. Reflecting the sadistic practices of the age, he staged a torturous enthronement ceremony where he forced Dozsa to sit on a red-hot iron, wear a smoldering crown and hold a molten scepter. Then he burned Dozsa at the stake and gave his supporters a choice between death or eating alive their leader, then writhing in the flames. “Dogs,” screamed Dozsa as they ripped off his charred flesh and consumed him.
Zapolya had won, but Hungary remained volatile. With the Turks on the loose and the peasants looking for a fight, Fugger’s investments remained at risk. Division among the Hungarian nobility complicated matters and a war between rival noble factions loomed along with everything else. Fugger needed a permanent peace. The Hungarian royal family agreed. For years, it had been talking to Maximilian about a marriage alliance that would make the Habsburgs their protectors. But Maximilian was too busy in Italy to give it his focus. Now, with his treasure threatened, Fugger did something new. He gave Maximilian an ultimatum: Either strike a deal with Hungary or forget about more loans. Fugger had never before tried to manipulate Maximilian so overtly. In the past, if Fugger liked one of Maximilian’s schemes, such as the phony imperial coronation, he was generous. If he objected to a project, such as Maximilian’s papal venture, he delayed until the request went away. But he never initiated anything. He did this time. There was too much on the line to sit it out.
The threat worked. To appease Fugger, Maximilian sent an ambassador to Hungary to negotiate a marriage alliance—an alliance that promised the eventual handover of Hungary to the Habsburgs. No matter that the Hungarian people might object to Habsburg rule. No matter that it meant redrawing the map of Europe by creating the giant political tinderbox known as the Austro-Hungarian Empire. Fugger needed a Habsburg seizure of Hungary to protect his holdings.
To discuss details, Maximilian agreed to see King Ladislaus of Hungary and his older brother Sigismund, the king of Poland. The monarchs originally planned to meet in Lübeck because Lübeck was near Poland and Poland played a key role. Like kids trading baseball cards, Maximilian planned to give Sigismund the imperial possession of Prussia, home of the Germanic religious order of the Teutonic-Knights, in exchange for Hungary.
Fugger hated the idea of a Lübeck meeting because the Hansa were there. Concerned the Hansa would slander him while the kings were in town, he encouraged Vienna as an alternative. Besides, he wanted to attend and Vienna was an easy boat ride down the Danube. They accommodated him. In 1815, exactly three hundred years later, the great European powers met in the same city to engineer a peace treaty that won decades of European tranquility and made famous the term “balance of powers.” The meeting was called the Congress of Vienna. It was more like the second Congress of Vienna. The first occurred when the three kings—Maximilian, Ladislaus and Sigismund—met in the city to consider the future of Hungary and, as a consequence, Fugger’s copper mines.
The outcome hinged on personal chemistry and, to Fugger’s delight, Maximilian and Sigismund liked each other. Maximilian called Sigismund a great prince and Sigismund invited him to hunt in Poland. They struck a deal that gave Fugger as much as he could hope. Hungary would immediately become an Austrian puppet and the Habsburgs would formally take over Hungary after Ladislaus’s line died out. Poland would get Prussia and, as a sweetener, Maximilian promised not to ally with Russia, which was then at war with Poland. The kings sealed the accord with plans for not one but two marriages. Maximilian’s grandson Ferdinand would marry Anne, the daughter of Ladislaus, and Maximilian’s granddaughter Mary would marry Louis, Ladislaus’s son.
Weddings are expensive—especially double weddings between royal families. Fugger gave Maximilian what he needed to pay for it. In a letter written in Augsburg to the Tyrolean council, Maximilian explained in achingly honest terms why he had to put himself—and thus the state—further in debt:
We cannot do this [the Hungarian takeover] unless the loan from the Fuggers is carried through. For without this we cannot go on, but will have to drop all the above dealings with both kings and abandon the plan for our children and theirs, and cancel all arrangements, and it will probably bring about the disadvantages and injuries suggested above if we finally abandon our meeting with them. If we knew any other method of finance, we would have been only too glad to spare you this, but we know of no other way.
After settling the financing, Fugger and 10,000 other wedding guests descended on Vienna. Fugger, like Charles the Bold when he went to Switzerland, brought his jewelry. The Habsburgs wanted to dress like Burgundians and needed Fugger’s stones to create the illusion of family riches. Maximilian had nowhere near the means of his dapper father-in-law Charles, but he could look like him for a day thanks to Fugger. With Fugger in the pews at St. Stephen’s, Maximilian’s organist played a thundering Te Deum and Hungarian musicians played battle marches. Maximilian’s secretary took offense with the military posturing of the Hungarians and dismissed them as “horse eaters.”
The fine print of the marriage contract highlighted the complexity—if not the grotesque absurdity—of sixteenth-century royal weddings. Prince Ferdinand was too young to marry Anne, but their marriage was vital to the deal. To keep it on track, Maximilian, a widower, married her by proxy and agreed to take her as his wife if Ferdinand died before coming of age. Maximilian was fifty-five—exactly five times her age—and looked older because of the ravages of a puzzling disease new to Europe: syphilis. Cortez brought it back from the New World in 1504 and soon Maximilian, Erasmus and others had what they called the “French disease.” The disease so ravaged Cesare Borgia that he took to wearing a mask in public. Luther complained about outbreaks at monasteries. Fearing death at any moment, Maximilian traveled with his casket just in case. “Ask God for my health,” Maximilian told Anne at the altar. He put a crown on her head and declared her a queen of the empire. Louis and Mary wed in the undercard. Fugger saw the
value of his Hungarian investment grow more secure with every vow.
While in Vienna, Fugger fished for business. Instead of awarding new depositors with toasters, he gave out diamonds, rubies and sapphires. He gave necklaces to the ladies and gold rings to the men. The gifts were a cost of doing business. His records show that he spent 9,496 florins, 18 shillings and 5 Rhenish hellers on the Vienna trip, including travel expenses. The effort paid off when George Szathmary, the archbishop of Gran, one of the richest men in Hungary, moved his accounts to Fugger.
From the standpoint of Hausmachtpolitik, the congress was a victory for all. For King Ladislaus, too weak to keep his family on the Hungarian throne without help, the agreement kept him in power and won a friend in the fight against the Turks. King Sigismund of Poland saved himself from a two-front war with the empire and Russia. Maximilian, by keeping Anne in Vienna until she married his grandson, attached Hungary as a satellite of Austria.
The Roman poet Ovid described the Trojan War hero Protesilaos as more deserving of love than war. Matthias Corvinus, the Hungarian king who had taken Vienna from Emperor Frederick, reworked Ovid’s words and applied them to the Habsburgs. Bella gerant alii, tu felix Austria nube (Others wage war but you happy Austria wed). The words became a family motto. Fugger had now played a role in four Habsburg weddings. He and his brothers had dressed Frederick for the meeting with Charles the Bold that led to the marriage of Maximilian and Mary of Burgundy, and gave the Habsburgs the Low Countries. Later, Fugger’s loans puffed up Maximilian and made his son Philip a more attractive suitor for Joanna of Castile—the wedding that gave Spain to the Habsburgs. Now Fugger’s prodding brought about a double wedding and Habsburg control of Hungary.
The Richest Man Who Ever Lived: The Life and Times of Jacob Fugger Page 11