The House of Rothschild

by Ferguson, Niall

  Identification with one’s native land cut the other way in Paris. James’s sons, unlike their father, were French citizens and they were punctilious in their patriotism. On July 19, for example, Alphonse resigned his post as consul-general of the North German Confederation in France. They subscribed for at least 50 million francs of the August war loan. From the outset, he and Gustave expressed the hope that “the first clash would be favourable to French arms.” At first this was primarily because they believed it would precipitate English diplomatic mediation; but as the war proceeded, anti-Prussian feeling began to generate a less dispassionate patriotism. By the time Ferdinand arrived in Paris, he found his cousins “very excited and pour[ing] out volumes of wrath on the Prussians, Bismarck and Cie.” “They are all extremely French in their views and feelings,” he reported to London, “plus catholique que le pape.” Edmond and Nat’s son James Edouard, as noted above, served in the Garde Mobile; and Alphonse did his bit guarding the ramparts of Paris on the eve of the Prussian siege, as did Nathan James, who may have fought in Trochu’s abortive “sortie” to the south of Paris on November 30. On August 6 Mérimée heard of “a Rothschild” leaving Paris in August “with his bag and a baguette on his back, travelling in a third class compartment of the Nord railway, in which his house has twenty million shares.” Though it is undeniable that Anselm returned to Vienna before Sedan and James Edouard’s brother Arthur was in Brussels in late 1870, that story has the whiff of malicious gossip. In reality, the Rothschilds stood their ground and risked their lives in the crisis, unlike many wealthy Parisians.

  The difficulty for those in France was that from a very early stage they were confronted with alarming intimations of defeat. Anselm happened to be in Paris when the war broke out, and he made no secret of his views: “The French are full of enthusiasm but the Prussians have a better military organisation and their army is much superior in number.” Alphonse too was pessimistic. “The wine is poured,” he declared on July 20, “and it is unfortunately necessary to drink it. It will be pretty bitter.” An early sign of French mismanagement in Rothschild eyes was the response of the government to the economic consequences of the war. Talk of the suspension of gold convertibility by the Banque de France and heavy-handed attempts to prevent specie from leaving Paris infuriated Alphonse, who favoured relying on increases in the discount rate. On August 4 some 2 million francs of silver which the Rothschilds were sending to Belgium in exchange for gold on behalf of the government were seized by the police in the belief that they were being smuggled out of the country. By the 12th, the Banque had effectively been forced by the government to suspend convertibility and this was followed by a moratorium on bills of exchange: the only reason Alphonse did not resign his post as regent over these measures was, as he put it, that it would be “to desert one’s post at the moment of combat.” More alarming still was the request of a “senior military personage” to send a small packet of his securities for safekeeping in London house. As Alphonse commented, “Such a recommendation on his part, as you may imagine, has awakened our suspicions, and we intend to follow his example ...” They began to do so three days later. On August 11 James Edouard sent over his collection of rare books and drawings. As the crisis deepened, securities were sent to Lambert, the Rothschild agent in Brussels. On the day of Sedan, at Bleichröder’s recommendation, the Paris house sold the shares it held in the Cologne—Minden railway—at a handsome profit.

  Measures to stop capital flight were, however, the least of Alphonse’s worries. From a remarkably early stage—well before news of reverses at the front—he and his brother feared that war would trigger a revolution in Paris. As early as July 19, Gustave was reminded of 1848; a week later, his brother was detailing the steps being taken to combat the “desperate efforts” of “the Left” to stage a “coup de main” in Paris. At that stage he was still confident that the government had the situation under control; but by the first week of August he felt that in its efforts to combat capital flight the government itself was allowing itself “to be drawn down the revolutionary slope. Once it was the nobles who were regarded as suspect; today it is businessmen.” “The danger comes from the interior rather than from the Prussians,” he wrote sombrely on August 3. “We have no military force here [in Paris], and if by some mischance we were to suffer some reverse, who knows to what excesses the fury of the populace could lead.” The Finance Minister seemed unable to resist “the propensities of certain members of the Cabinet who believe themselves back in the time of the French Republic.” If a military victory did not come soon, warned Alphonse on August 6, “the revolutionary party would gain the upper hand.” Just three days later, revolution no longer seemed merely possible, but distinctly likely in the absence of a military victory. When the Legislative Body met there were calls not just for Ollivier’s resignation but for the abdication of the Emperor, who was frantically trying to mobilise a new army at Châlons. As far as Alphonse could see, the fall of the Empire was now “a fait accompli.”

  This prescience of revolution is easy to explain. To the Rothschilds (as to Metternich), modern history’s most important lesson had always been that a French revolution might lead to a European war, and that conversely a war involving France might lead to a French revolution. This fear had influenced Rothschild calculations time and again since 1815, but had never been exactly fulfilled. In 1830 and 1848 there had been revolutions without wars. In 1855 and 1859 there had been wars without revolutions. In 1870 history at last fitted the Rothschild model. Indeed, that may be why the Rothschilds came out of the 1870-71 crisis so unscathed.

  At the same time, there was also a genuine desire on Alphonse’s part for a limited republican revolution to get rid of the Bonapartist regime, which his parents had always viewed with such suspicion and which he himself had overtly opposed during its final liberal phase. Alphonse’s letter to London of August 13 indicates that he was already in contact with moderate republic leaders—“certain persons who under the present circumstances could be called on to exercise an influence on events”—and that they had reassured him of their commitment to maintaining order. At least one member of the new Government of National Defence—Cremieux—was an old Rothschild associate, and Alphonse was quick to reassure his cousins of the new regime’s good intentions. “As the republic has been proclaimed,” he reported on September 4, “it is probable that popular anger will be disarmed and that there will be no serious disorder on the street.” Any possibility of a Bonapartist restoration or regency (something Bismarck would not have been averse to) Alphonse vehemently opposed. There is some evidence, admittedly, that he and Gustave would have welcomed a monarchist restoration, whether of the Bourbon or Orléanist dynasties. But in the immediate crisis of military defeat, they embraced the Republic without equivocation, even if privately they hoped it would be a transitional regime.

  Bismarck at Ferrières

  The most poignant symbol of the French Rothschilds’ share in the French defeat was without doubt the occupation of the château and park at Ferrières. This was an eventuality which Alphonse had anticipated with trepidation even before Sedan. On September 14, a week after the advance on Paris had begun, it happened.

  It was at Ferrières that the first tentative and unsuccessful steps towards peace were taken by the new French government; and at Ferrières that Bismarck and Moltke openly quarrelled over strategy. Therein lies its principal historical importance. Yet the occupation of Ferrières can be seen to have had another significance: the “irony” of having the Prussian King and his Junker Chancellor installed at the château which was the most extravagant statement of Rothschild and therefore Jewish wealth. For Stern, the “raucous” conduct of the Germans was an expression of anti-Semitism with ominous significance. The difficulty is in deciding how improperly by contemporary standards the occupiers actually behaved.

  The first Prussians to arrive, according to an account later written by the estate manager Bergman for Alphonse’s wife Leonor
a, were Generals von Eupling and Gordon and their respective staffs. Relations with the Rothschilds’ domestic staff certainly got off to an unpromising start. On September 17 General Gordon ordered the head butler to arrange dinner for fifteen; when thirty-two guests turned up there was not enough food to go around (though sixty-five bottles of wine were consumed) and Gordon had one of the servants locked up in the stables overnight as a punishment. The next morning Gordon left, and the 19th saw the arrival of William I, accompanied by Bismarck, the Chief of the General Staff Moltke, the Minister of War Roon, numerous other senior officers and around 3,000 men. (Others who stayed there included the Grand Dukes of Baden and Mecklenburg-Strelitz.) To some at least of these uninvited guests, Ferrières was a revelation. With its Mentmorian exterior and exotic interiors, it seemed “fairylike, magnificent”; yet the fact that it was the creation of a Jew—of the “Judenkönig,” as Roon called him—tempered their admiration with disdain. The initials JR—James de Rothschild’s —which recurred on the ornate walls and ceilings were translated with laboured humour as “Judaeorum Rex.”

  Perhaps mindful of James’s efforts to thwart his plans in 1866, Bismarck himself seems to have taken an especially malicious pleasure in the situation. “Here I sit under a picture of old Rothschild and his family,” he wrote to his wife on September 21 from what had been James’s suite of rooms. “Negotiators of every sort hang on to my coat-tails like Jews round a market trader”—a significant choice of image. It was Bismarck who threatened to beat a servant who refused to serve him wine from the Rothschild cellars. And it was Bismarck who went out shooting pheasants in the chateau grounds, grumbling that the gun he was given was too small, with too few cartridges and inadequate shot. It was probably also Bismarck who arranged for a complaint about Rothschild inhospitality to be placed in the German press. Later, when asked whether he would be prepared to negotiate peace terms with a republican regime, Bismarck replied snidely that he would recognise “not only the Republic, but, if you want, a Gambetta dynasty... Indeed, any dynasty, whether Bleichröder or Rothschild.”

  On the other hand, Bismarck’s feelings of animosity were not shared by his royal master. “Folk like us can’t rise to this,” William was heard to comment on seeing Ferrieres; “only a Rothschild can achieve it.” Anxious not to give offence to the family, he specifically ordered that there should be no requisitioning from the estate and that game and wine cellars should be left intact. As Bergman reported, “The sojourn of the King went off well, he had his own kitchen and kitchen staff, the estate had to provide for everything necessary, game, fruits and flowers; he gave 2,000 francs for the staff of the château.” He also took “good care to obtain a written statement that after his departure nothing was missing in the château” and left seventy-five men behind to guard it. No doubt there were some departures from these royal self-denying ordinances. “The soldiers billeted at La Taffarette [part of the estate],” grumbled Bergman,fished all the ponds, but that wasn’t enough for them, so they decided one night to open the sluice-gates in order to find lots of fish stranded the next morning. When I was given warning of this, I went with several of my men and a locksmith arrived to close the gates, but at that very moment the cavalrymen arrived to water the horses. Terrible disappointment, no water! The soldiers thought it was I who had had the water drained and they dragged me to the General.

  After the King’s departure on October 5, several houses and the chateau cellars were “pillaged” and blankets and mattresses were requisitioned for nearby field-hospitals. On January 1, 1871, Bergman lamented:There is no more livestock on the farms, we have no coal, [though] we have still got some fire wood. The game of the outer park has been killed by the Prussians and by poachers; the grounds are reserved for the Prussians, the Commandant has it patrolled at night, the pheasants and flowers are reserved, the gamekeepers were disarmed the day the Prussians arrived ... [T]here’s no money left in our cashbox, we pay with bread coupons, the farms are used as barracks ... In short they treat Ferrieres with respect, there are 25 officers at the chateau at present, they have their own cook paid for by the château but they are very hard to please. Finally the requisition expenses of the estate and of the village approximately amount to 200 to 250,000 francs ... [T]he château [is] very dirty indeed.

  Yet we should not exaggerate the significance of an old retainer’s hand-wringing. Prussian troops remained at Ferrières until the end of August 1871. Naturally, the French Rothschilds were only too keen to find fault with the conduct of the occupiers. But when Anthony visited the château on September 1, “to see what the Prussians had done [and] whether everything was as it was when the poor Baron left it,” he was pleasantly surprised. According to his account,there is not the least damage either to the House [or] the Park [or] the trees, there are as many pheasants in the Park as formerly—they have a great many more partridges & all their birds are there—not a thing injured in the gardens so that the King’s orders were obeyed—they have even sent back all carriages that they took to Versailles—they drank all the wine that was in one cellar—the other one was finished up ... They took a few little things not worth speaking [of], Bismarck took 250 sheep. Of course the carpets [are] a little spoilt ... but when one considers that all the Prussian Army passed by ... I think it wonderful that not a thing should be hurt ... & they all ought to thank His Majesty & hold their tongues ... So much for Ferrières—& I think that with all their Houses—Boulogne & Ferrières—nothing damaged by the war[,] nothing taken by the communists, no person hurt or wounded[,] that they ought to thank God that they got off so well.

  Even allowing for his evident impatience at the griping of his French relatives, Anthony’s account would seem to explode the idea of Teutonic depredations. Gustave himself admitted that the estate was “in as fair a state of things as could be expected” when he visited the chateau later the same month.

  On reflection, the notion that the Prussians indulged in looting and pillaging may have been a construct inspired by the peace terms outlined by Bismarck at Ferrieres. The French regarded these as excessively harsh; they were therefore inclined to think of the German armies as ruthless plunderers at the local level too. The Rothschilds’ role in the peace negotiations was so important that it was perhaps inevitable that they began to equate the fate of France with the fate of Ferrières, and to exaggerate the burdens imposed on the latter.

  We have already seen how quickly Alphonse and Gustave accepted the need for a moderate republican regime in the aftermath of the defeat at Sedan, while continuing to express forebodings about the danger of a full-blown Jacobin revolution in Paris. When reading their letters to London in 1870 and 1871, it is important to remember that their original objective had been to secure swift English intervention to end the war and establish a moderate peace. To some extent, therefore, warnings of impending revolution had a diplomatic purpose. As Alphonse wrote to London on August 8, “If Europe does not want France to become a hotbed of anarchy, it is necessary that it be ready and resolved to intervene seriously and without wasting time after the first big battle.” Five days later, he insisted that effective English peace-making was also the condition of political stability in a new French republic. Even at this early stage Alphonse was unequivocal about the kind of peace which would be acceptable, so much so that it becomes hard to distinguish his own views from those of the moderate Republican leadership. In fact, Alphonse’s first letter to London on the subject predated the fall of the Empire by some weeks. On August 13—in a carefully phrased resume which was obviously intended to relay republican views to Gladstone—he stated the terms which a new republican regime would be willing to accept on the assumption of a French defeat:Any dismembering of France would be opposed to the last and any pretensions of that nature raised by Prussia would encounter a desperate resistance. Even a war indemnity would be a difficult condition to accept, but influential forces would exercise themselves in that sense ... for if we were beaten it is evident that it would be ne
cessary to submit to a certain extent to the laws of defeat. It would nevertheless be necessary for the [other] powers to be ready to intervene very swiftly, and mediation to happen immediately, for otherwise any loss of time could only increase the mood of exasperation and compromise the results of mediation. One would therefore agree to give some money, but one would go no further.

  He repeated that formulation on September 4, the day the news reached Paris of the débâcle at Sedan:One will sign a peace without hesitation, no matter how miserable and humiliating it may be, if it can be obtained by a sacrifice of money. But no one here will dare to sign a peace that entails a cession of territory. You will say to us that in the present state to which we are reduced France cannot defend itself, that we have no more army and no ammunition. That may be true, but the public sentiment is so strong that the country would rather allow itself to be ruined and broken into pieces than have to cede territory. That would mean the destruction of France and I believe that the foreign powers have a big enough interest in not allowing the balance of Europe to be completely overthrown by Prussia to prevent such a fatal result. The moment to intervene has arrived. Any action must be immediate and energetic.

  Jules Favre’s famous “not an inch of territory” statement of September 6 thus can have come as no surprise in London. Alphonse saw Favre that very day, and once again anticipated his argument: “One can consent to every sacrifice except that of a cession of territory ... because a cession of territory will render all government impossible ... I am perfectly convinced that the present government has only one thought: to make peace. But it is in the interest of Europe to intervene in order that this peace should not be ephemeral.” Later, Gustave was critical of Favre’s tactics, blaming them on General Trochu; yet it is evident from the Rothschilds’ own correspondence that his brother had a major hand in them and regarded Favre’s statement as “worthy and clever.” Indeed, to judge by Alphonse’s letters, it was he as much as Favre who was making French foreign policy in September 1870. On the 11th, for example, his letter to New Court contained threats and promises intended to secure English mediation which it is hard to believe were authorised by the government as a whole:It is in the interest of all Europe ... to render peace possible and not to throw France into a state of anarchy such that an occupation, so to speak on a permanent basis, becomes necessary [as that] would inevitably lead sooner or later to the most serious complications and could even cause Prussia to lose the positive results of her victory. That is not a threat, it is the truth of the situation. No one will dare to sign a peace with cessions of territory, and it will be necessary for Prussia to govern the country, which will not be easy, for in every town in France which has not been occupied by the enemy, there will be revolutionary movements ... Be assured that one will accept here all the conditions that will be demanded to obtain peace except a cession of territory. A war indemnity, part of the navy, even the French colonies and even more so Luxembourg.