The Jews in America Trilogy

by Birmingham, Stephen;

  Jesse Seligman was in Europe that summer, and so Isaac Newton Seligman, Joseph’s son, took over entertaining and smoothing the way for the Prince. After opening his account, the Prince asked Isaac whether there were any other businessmen in the United States who might be helpful to him, and Isaac

  responded with a rapidity of decision characteristic of businessmen the first of this type I met personally. With a few words he outlined to me what course of procedure to adopt and which people to see. While I was trying to express my appreciation to him, he held in one hand the telephone through which he arranged a meeting for the same day … while with the other hand he was ringing the bell for a stenographer, to whom he dictated a letter of introduction accrediting me in Chicago to Mr. Lyman Gage, President of the Bank that was their correspondent in that city.*

  Saying, “Come have a bite,” Isaac took the Prince to lunch on the top floor of the Mills Building, “where there was a sort of grillroom reserved for the tenants and the owner of the place,” and introduced the Prince to the other Seligman partners. Here, the Prince suspected, the partners were in psychic financial communication with one another. By Isaac’s manner toward him, the others were able to judge the exact size and importance of the Prince’s account.

  To explain my unexpected presence to four Christians seated around a table, it would have been necessary to advise each of them successively that my letters of introduction had been signed by So-and-So, that I had important matters to cable to Paris, and heaven knows what else! Four Christians, I said, but I should have specified the denomination, since for four Protestants these hints would not have been enough.

  But in the presence of the Jewish bankers the Prince found no such tiresome need to offer his credentials.

  Words were superfluous; the attitude of the head of the firm amply sufficed. His partners now knew as much about me as he did. They had watched him from the moment we sat down, and from his expression had gauged the precise degree of consideration to which he judged me entitled. I suspect, in fact, that if it had been a question of a bank statement, each partner could have scribbled the exact amount on the tablecloth without appreciably deviating from his senior’s estimate.

  This ability to communicate without words the Prince ascribes to something with which “nature seems to have wished to compensate this astonishing race for the insecurity against which it has struggled for centuries by endowing it with an ability, which escapes us, to understand each other in silence.”

  The Prince was also relieved to find that the Seligman partners did not appear to be overawed by the fact that they were lunching with royalty. “I felt in them,” he wrote, “a shade—oh, scarcely perceptible!—of that reserve which a name and title had already earned for me, and for many years would earn for me, in the presence of businessmen, who automatically thought of me as a personality.” But this scarcely perceptible shade of deference was not enough to be off-putting.

  Isaac invited his Highness to spend a weekend with the Seligmans at the Jersey shore, and, at the outset at least, the Prince was not at all sure what he was getting into. On the ferryboat crossing, he wrote: “As soon as we left New York, the iced drinks circulated on the deck, and with more avidity than prudence I accepted the offer Seligman made me of sarsaparilla, a hygienic drink, something like a cross between beer and a mouthwash.” But as soon as the boat had docked at Elberon the Prince began to see what New York’s German Jewish society was all about. He realized that he had entered a special world not quite like anything he had ever seen before in America or on the Continent. It may not have been an aristocracy, precisely, that the Prince encountered in Elberon, but it was a world of grace and ease and bonhomie which captivated him completely and haunted him for years to come. Years later he reminisced that he met people that weekend “of whom no counterpart then existed in Europe, and probably no longer exists in America.”

  This is what the Prince’s wondering eyes beheld:

  Upon the arrival of the boat, a large number of carriages, mostly driven by wives or daughters, came to pick up the passengers, whose residences spread out for several miles along the coast, and also inland, as was the case with the Seligmans, whose house faced Rumson Road.

  Isaac Seligman’s wife was a daughter of Mr. Loeb, founder and partner of the house of Kuhn, Loeb, already well-known at this time but eventually to take on world importance. They had one child, then three or four years old, whom I unwittingly disappointed at breakfast when he saw that I was not wearing a crown.

  The house was simplicity itself—comfortable, of course, but without any show. Of brick and wood painted white, brightened by green shutters, it must have had four or five bedrooms, a bathroom—possibly two, but I doubt it—a dining room, and a drawing room giving on a porch where one spent most of the time.…

  The next day I was able to see that the neighboring houses, of much the same style and size, were occupied by more or less distant members of the family. To the left, next to Isaac Seligman’s, an almost identical house was occupied by his sister Mrs. Hellman, with whom we dined that evening—a charming woman, whose husband was the brother of the head of the Seligman firm in Paris.… To the right lived an older sister of Mrs. Seligman, who had married Jacob Schiff … a little farther along, Mrs. Seligman’s and Mrs. Schiff’s mother, Mrs. Loeb, whose husband was in Europe that year, lived in a considerably larger house with the youngest of the three sisters, Nina, a charming girl and an excellent musician, who later married Paul Warburg.… Finally, still farther off, on the seashore, lived a brother, David Seligman, with his wife and daughters, of whom one, Mrs. van Heukelom, resides in Paris today, and the other, Mrs. Lewisohn, comes to Cannes every year.

  In each of these households, the male servants were limited to a coachman, generally a Negro, who took care of the horses, and a gardener. Otherwise the servants were women—cooks and housemaids.

  If after more than forty years I can so distinctly recall the circumstances in which the numerous members of this family lived, it is because I was profoundly surprised at the time by the contrast that their private lives offered to those of most bankers and businessmen of Anglo-Saxon ancestry whom I met in America that year. In Wall Street, their financial power placed them all on an almost equal level with the big Anglo-Saxon bankers.

  Now the Prince made a particularly significant point about the Jewish bankers:

  Money in itself, however, had no significance for them outside of business. Any observer, listening to their talk during leisure hours would have taken them for good rentiers, given to sport, literature, art, and especially to music, who contributed generously to charity and still more to the finances of their political party, and, above all, were devoted to family life with an intensity to be met with today only in the French provinces.

  The Prince kept trying to put his finger on just what it was that was special and appealing about these German Jewish families, and concluded that they reminded him most of French provincials: “Moreover, apart from their taste for sport, the men’s private lives resembled rather closely those of the heads of the old banking houses of Lyon.” (The Prince’s repeated emphasis on “sport” is a little puzzling. Some tennis was played at Elberon, and a bit of croquet, and there was a good deal of walking. But in 1892 there were as yet no real “sportsmen” in the crowd. The Prince was probably overinfluenced by oarsman Ike Seligman, who was an exception.)

  The Prince found the atmosphere of the crowd foreign—small-town European—yet very American:

  In the preceding generation, the father and the uncle, the founders of the firm, had played a major role in politics … the men of this generation had inherited the business and worked to keep it going.… Born in the United States, they had breathed the invigorating air of that country at an early age, and their childhood, like their adolescence, was patterned after the current model of the “American College Man” … imbued with confidence in the future of his country as well as pride in the glory of its past. It was a rath
er limited past at the time, but because of that very fact so much closer, more vital, and more to be cherished. With the most sincere emotion, they spoke to me of the heroes of the War of Independence as well as those of the Civil War—the first epic antedating the selection of this new country by their parents—for, excellent citizens that they were, they had preserved an affinity for preceding events through legends with which their mothers had rocked them to sleep in their childhood, and which had later jelled at college with the study of Goethe, Schiller, and Heine.

  Prince Poniatowsky never visited Newport, but it is hardly possible that he would have found it as beguiling a place as he found Elberon to be. Clearly the nobleman felt very much at home there. Yet this is the same stretch of Jersey shore that critic Edmund Wilson, who grew up near Deal, has called a resort “of the second-rate rich.”

  On Monday morning, still starry-eyed, the Prince returned to New York and, that evening, was taken to dinner at the Knickerbocker Club. Over dinner he happened to mention the delightful weekend he had spent with the Seligmans at Elberon. A ghastly hush fell on the table, and the Prince began to grasp the social facts of life that existed in New York. After dinner he was taken aside by one of the club’s members who,

  with a little embarrassment, indicated his surprise at seeing me associate with Jewish families outside of business hours. Very much surprised myself, I listened to his description of the worldly conventions that kept Israelites away from the “inner circle,” no matter what their merits, their culture, or the outstanding roles they might have played in the development of the country! There was on his part neither passion nor animosity. He talked to me as though he were making a statement of facts, just as he might have briefed me on the fundamental differences between the Republican and Democratic parties.

  But the Prince was a prince, and was not to be put down by a stuffy clubman. “I must undoubtedly have scandalized him,” he writes,

  when I told him that I had accepted an invitation to go back the following weekend, this time to Mrs. Hellman’s home, and that I could not and did not wish to change this plan—first, because I had met some particularly interesting people there, and, more important, being a foreigner in this country, I did not feel justified in changing rules that I had followed up to now in this connection. Whether in France or in England, I had always maintained the most cordial social relations with the Rothschilds and the families of certain Jewish bankers with whom I had business associations, and I really had no reason to behave differently in the present case.

  In the face of this coolly royal response, the American clubman turned and walked muttering away.

  * Poor old Grant, who had long since given up marching in temperance parades, had always wanted to be a capitalist After leaving the White House, he set himself up, with the Seligmans’ help, as an investment banker in partnership with a glib young fellow named Ferdinand Ward, whose seemingly Midas touch had earned him the label of “the young Napoleon of Wall Street. In 1884 Ward told Grant that the Marine National Bank, in which Grant & Ward had deposits, was in trouble and needed $300,000 for one day only. Again with the Seligmans’ help, Grant managed to raise half this amount. Ward pocketed it and disappeared. Three days later, the Marine National closed as a result of overdrafts by Grant & Ward, and it soon turned out that Ward had embezzled more than $2 million from the firm and that its books showed $27 million in nonexistent assets. Once more, the Seligmans came to the aid of their old card-playing friend from Watertown days, and gave him funds enough to live comfortably until he had completed his memoirs and died. Grant’s Memoirs, of course, finally made his estate rich, and helped pay for his famous and imposing tomb.

  * Once more the Seligmans were displaying their uncanny way of getting to know the right people. Their friend Lyman Gage later became Secretary of the Treasury under President McKinley.

  34

  THE GUGGENHEIM-LEWISOHN BATTLE

  After meeting Adolph Lewisohn, a New York businessman once commented, “I guess his brother Leonard must be the smart one.” A few weeks later, he met Leonard Lewisohn. Following this meeting he said, “No, I guess Adolph is the smart one.”

  Neither of the Lewisohns was a Schiff-like financial genius. But they had gone about the business of getting rich with diligence, and had the assistance of a considerable amount of luck. By the 1890’s the brothers were considered copper kings—one of their mines had paid $35 million in dividends alone—and the impression one gathers of them at this point is that they had ceased caring about making money. Adolph himself once said, “I made as much money as I wanted to make, and then I stopped.”

  Having stopped, he started to spend, and here again he was the opposite of tight-fisted Mr. Schiff. He bought the E. H. Harriman mansion at 881 Fifth Avenue, a huge place at Elberon, and a hilltop castle in Westchester County, and quickly began filling all these places with friends, flowers, coolers of champagne, pretty women, and collections of precious stones in lighted cases. Though short and round and myopic—he never quite looked the part—Adolph Lewisohn became the crowd’s first certifiable playboy.

  His approach to life was inevitably reflected in his approach to business. In 1898 Adolph and his brother decided to join forces with William Rockefeller and Henry H. Rogers, one of the guiding lights of Rockefeller’s Standard Oil, to form, with some five million dollars’ capital, the United Metals Selling Company. The Lewisohn contribution to this combine consisted of their Perth Amboy copper works and all the copper interests of Lewisohn Brothers. The Rockefeller-Rogers group contributed the Amalgamated Copper Company, which controlled Anaconda and other copper producers. Adolph Lewisohn was made president of this trust, and Rogers’ son-in-law became treasurer. The merger was almost immediately successful, and soon 55 percent of all the copper produced in the United States was being sold by the United Metals Selling Company.

  The success of the selling trust led Adolph to the next step—the formation of a smelting trust. Including again the Rockefeller-Rogers group, this was a far more ambitious project with a capitalization of over $100 million. It was called the American Smelting & Refining Company, and it represented a merger of twenty-three different smelting concerns. Clearly, this was a trust designed to dominate the American mining scene—to give Rockefeller interests virtual control of everything under American soil, with Adolph and Leonard Lewisohn riding along as very important hitchhikers. There was only one difficulty. The Guggenheim interests, when asked to join the American Smelting & Refining Company, politely declined. It was one of old Meyer’s strictest rules: Guggenheim smelters must not be allowed out of the family. Perhaps Adolph Lewisohn felt, at this point, that he had already made as much money as he “needed,” and was ready to stop. In any case, he seems not to have grasped the importance of the Guggenheims’ refusal to become part of his merger, and to have been satisfied with their assurances that they would act “in harmony.”

  With the formation of their Guggenheim Exploration Company, the family had entered upon its most ambitious era. Its aim was to corner the best mines in North America in a great sweep from South to North, starting in Mexico and moving across the hemisphere through the United States, Canada, and Alaska. At the head of this vast plan was the most ambitious of Meyer’s sons, Daniel, the second-eldest. In the partners’ room at Guggenheim Brothers in New York, the various Guggenheim men are immortalized on canvas and, according to a persistent rumor, the square footage of each man’s portrait bears a direct relationship to the size of his contribution to the family fortune. Certainly the portrait of “Mr. Dan,” as he was called, is rather larger than the others. He was seven years younger than Adolph Lewisohn and in 1899 was still in his peppy mid-forties. He was a little man, like his father, but, according to Bernard Baruch, Daniel Guggenheim was “one of the three small men I’ve known—the others were Sam Gompers and Henry Davidson—who sat taller than most men stand. I see Dan … a little fellow sitting in a big chair and dominating the entire room from it.” His most
arresting features were his greenish-blue eyes, which (it seems to have been a prerequisite for turn-of-the-century tycoons) have always been described as “piercing.” Daniel Guggenheim had also decided that he wished to dominate the American mining scene. His companies were earning a million dollars a year, but with the formation of the American Smelting & Refining Company he was on the defensive for the first time. He was less interested in “harmony” than in victory.

  At this point, one begins to get the impression of Adolph Lewisohn fiddling while Rome burns. Busy with his parties, he seems to have assumed that the sheer size of his American Smelting & Refining Company, and of his associates, Rockefeller and Rogers, would win the day. Rogers, too, seems to have been under this misapprehension, while Rockefeller, as he often did, was leaving everything to Rogers. Daniel Guggenheim, meanwhile, made several bold moves. He gathered on his team a speculator named William C. Whitney, who had married the sister of Oliver H. Payne, a large Standard Oil stockholder. Whitney had speculative capital to spend. Next, Guggenheim had a stroke of luck. A strike crippled a number of the American Smelting & Refining Company’s properties, making the trust temporarily vulnerable. Dan Guggenheim took advantage of this by heaping lead on the market and forcing the trust to sell below cost. Dan began buying up A S & R shares. In December, 1900, the trust made Dan Guggenheim another offer to buy him out, but this time the trust was leading from weakness. Guggenheim knew it, and made the most of it. He would sell, he announced—for $45.2 million. And for this price the trust would receive all the Guggenheim properties except the best ones—the Colorado and Mexican mines and the Exploration Company. With the remaining properties came, as well, the Guggenheims. And so, all at once, the American Smelting & Refining Company was the Guggenheims. Daniel Guggenheim was president, and four other Guggenheims were on the board of directors. It all happened so fast that it seemed like sleight of hand.