The Warburgs

by Ron Chernow

  In 1919, Siegmund was seventeen and in a quandary about his future when uncle Max took things in hand. He knew Siegmund was smarter than Eric and already saw in him flashes of his grandfather. “What do you want to do now?” Max asked. Siegmund said he wished to study history and philosophy, then go into politics. Max, scapegoated for Versailles, must have been dubious. He pretended to agree with Siegmund while pushing him in another direction. “I think that’s an excellent idea,” he replied. “But what I think you should do in addition is work for a few years in our old banking firm, because it may be very useful for you to know a little about business.”13

  Still green and bashful, Siegmund was flattered by Max’s attention and very impressed by his charm and flair. While Georges wanted his son to inherit his estate, he realized that Siegmund looked beyond the Swabian Alps, so encouraged him to train in Hamburg. In 1920, Siegmund moved into the Alsterufer house of uncle Aby S. His entrance into the Hamburg bank foreclosed other careers—teaching, politics, philosophy—that would always tease him with a sense of phantom might-have-beens. The Alsterufer Warburgs at once feared that the Mittelwegs might try to steal Siegmund to their side. “Intrigues against Siegmund to move to Mittelweg and out of Alsterufer,” his cousin Olga recorded in her diary in October, 1921.14

  That year, Georges suffered the first of several strokes that forced Lucie to attend to him night and day. She handled him with great solicitude, sharing his happiness while shielding him from care. In October 1923—right at the peak of the inflation—Georges died at fifty-two and was buried on the estate. In his will, he left a special bequest enabling every child in the village, at some point, to take a four-day Swiss holiday. This made him a sainted figure in local memory.

  Georges’s death left a distraught Lucie terribly burdened, and Max promised he would take care of Siegmund. Lucie began a long, bittersweet widowhood. While still managing the estate, she returned to the piano for the first time in years. Twice weekly, she took lessons in Stuttgart and resumed composing and playing Beethoven and Bach. In her musical compositions, Siegmund thought he detected a buried yearning for happiness beyond earthly cares. Georges’s death only deepened the already intense bond between mother and son.

  With his father dead and the family fortune wasted by inflation, Siegmund, twenty-one, assumed premature responsibility. He would always be stooped under one burden or another, lending a somber air to his elegance. Georges’s death sharpened his sense of the Mittelweg-Alsterufer rivalry. Two weeks after his father’s passing, Siegmund told Aby S.’s son, Karl, that the death reminded him of their family legacy and how few male heirs they had in their branch.15 He was the only son bright and able enough to assert the Alsterufer honor at the bank.

  Siegmund’s experience in the Hamburg family would leave him scarred and embittered. At the bank, he worked extremely hard but didn’t advance as fast as he hoped. He stood far above his peers there. His cousin, Karl, had been slow in school and was often rebuked by Max for his sluggish, perfunctory manner. Eric, though bright, was distracted by his busy social affairs and often absent. Siegmund felt himself a star deprived of his rightful place in the Warburg firmament because he came from the wrong side of the family. For the first (but hardly the last) time, Siegmund knew the stifled resentment of the gifted outsider who feels excluded by well-born insiders.

  Siegmund must have envied Eric, with his many friends and doting sisters. Even as Siegmund bore the yoke of early responsibility, Eric courted adventure and romance in Hamburg and America. Competitive and bright, Siegmund saw his Hamburg relatives coasting on their names and Eric, in particular, seemed to embody the vanity of inherited wealth. Siegmund would always be sensitive to Eric’s frivolous, social-climbing side, but less sensitive to his sterling qualities, his personal generosity, devotion to charity, and good nature.

  Siegmund faced ostracism from the Mittelweg family. Having grown up in rustic Swabia, he was the country bumpkin from a remote, slow-paced region. He was teased as a bookworm and a mother’s boy who was always writing to Lucie. He suddenly encountered raffinée cousins who dressed stylishly, wrote poems, and threw fancy parties. He was well worked over by the Mittelweg snobs and gossips. “We treated him like dirt,” conceded Aby M.’s daughter, Frede. “He wasn’t from Hamburg and we were young and foolish.”16 Not all Warburgs felt repentant about their early treatment of Siegmund. “He was conceited and very bright,” said Bettina. “He and Eric were neck and neck all the time in the firm. Siegmund felt he was from the inferior branch of the family and brighter than Eric. But Eric was papa’s son and in the saddle.”17 Max fed Siegmund’s bitterness through blatant favoritism. At day’s end, he would call in Eric and confide in him about business matters. Eric believed this partiality bred envy in Siegmund, who was extremely sensitive to slights.

  Siegmund reacted to condescension by putting on airs and adopting a superior pose, wrapping himself in a moody, Byronic aura of mystery. Like most loners, he nursed his wounds and hid his emotions, awaiting his chance for vindication, even revenge. At the bank, he had many friends who found him a keen listener and warm, stimulating companion. And he wasn’t shunned by all Mittelweg Warburgs. He was a great favorite of Louise Derenberg (Fritz’s twin sister) and her husband. Their daughter, Gabriele, liked to chat with this brainy, attractive cousin. In the mid-1920s, when Siegmund stayed with Louise’s family, she taught the rustic relative how to tie a tuxedo tie.

  Whatever his inner bruises, Siegmund found many role models in Hamburg. In the early years, he loved Max’s swagger and would later adopt many of his sayings and methods in London. At first he found Carl Melchior cool and forbidding, then developed an enormous admiration for him. He saw Melchior as an Erasmus-like figure who pursued truth and mastered his emotions. Siegmund would mimic the way Melchior reviewed ail options in a discussion before advancing his position, or the way Melchior wrote brief cryptic rejection letters to minimize the offence given.

  In 1925, Siegmund apprenticed at N. M. Rothschild & Sons in London, auditing courses in currency theory and other subjects at Cambridge University. As he roamed about the quadrangles, he drank in the magnificent architecture and fragrant greenery. Foreshadowing things to come, he wrote home, “My love for Germany hasn’t diminished here, but I admire many things and one quickly feels at home here.”18 Again an outsider, he didn’t join a college, claiming they were all ruled by cliques. In London, Siegmund already betrayed a knack for latching on to exceptional people, including a young German banker named Hermann Abs, apprenticing with Guaranty Trust. The two young men went to the theater and concerts together, forming an important intellectual friendship.

  Back in Hamburg, Siegmund fell in love with a spectacularly beautiful young Swedish woman named Eva Maria Philipson, a distant relative. Eva had instinctive elegance. After the rough-hewn Uhenfels, she must have seemed a vision from paradise. Her exceedingly handsome father, Mauritz, headed the Svenska Handelsbanken, a rival to the Wallenbergs’ Enskilda Bank. He was a strong, forbidding man, a domineering father, and a tough negotiator. Though Jewish, Mr. Philipson was the first in his family to marry outside the faith. Raised as a Protestant, Eva knew the Bible intimately.

  Eva was born into a family that favored a cloistered life for young girls, had a strict, repressive childhood, and stood at the mercy of a horrible governess. She was so regularly reprimanded by her parents that one day at the dining table she looked up at a painting on the wall and told her irritated parents, “Grandpa isn’t cross with me.” Her strict father discouraged her interest in nursing and dance and her mother always dressed her in fashionable sailor suits that she hated. Eva’s brother was a Nordic giant, enormously tall and good-looking. The Philipsons believed Eva should know foreign languages and rotated her through England and France. In the mid-1920s, she was sent to Hamburg, partly to learn German and partly to protect her from the murky enchantments of Paris. Hamburg seemed a safe refuge, and she stayed with Fritz and Anna Beata, who came from the Swedish War
burgs.

  When Fritz took her to the bank one day, she was at first delighted. Then he led her to a desk, handed her copy to type, and left the room. Suddenly realizing she had been involuntarily drafted as a secretary, she burst into tears. When another secretary asked what was wrong, she said, “I have a terrible cold.”19 The young men in the bank fiercely vied for Eva and all work stopped when she entered a room. Eva and Siegmund fell in love instantly. She was attracted by his dark good looks, his dazzling intelligence. His passionate intensity must have been irresistible after her severely formal upbringing. She had been taught to swim, sail, and sew, but not to read. For Siegmund, Eva was the stuff of boyish fantasy, stylish, soignée, but also bright. She had fashion-plate good looks and a serious, if still untutored, interest in politics and ideas.

  Fearing his catty cousins, Eva insisted they keep the love affair and the engagement secret. One day, she was traveling on a train with her parents when she screwed up her courage and announced, “I’m engaged.” She knew her parents would be shocked and they jumped in amazement. To denigrate Siegmund’s conquest, the Mittelweg Warburgs grudgingly said they felt sorry for Eva. But Siegmund was an extremely eligible young man and Eva felt very lucky to beat out the stiff competition. Some Warburgs did see Eva as a bit of fluff and no match for her deep-thinking fiancé.

  But Eva was more than pretty decoration for Siegmund. As the more worldly partner from a high-society background, she had a maternal tenderness toward this young man who still had a country roughness. For all her feminine charm, Eva was tough-minded in dealing with people and less likely than Siegmund to be swayed or blinded by emotion. With Siegmund prone to swing from excessive enthusiasm to equally unwarranted pessimism, Eva provided emotional stability. She was the gyroscope that kept him on a steady course. Near the end of his life, Siegmund alluded to this difference: “My wife says that in certain dealings with human beings I am a baby.”20

  Siegmund and Eva went to Swabia to announce their engagement to Lucie. Though Siegmund wasn’t an observant Jew, Eva converted to Judaism to satisfy the Warburgs and, on the eve of their wedding, went to a mikveh or ritual bath in Stuttgart.

  On November 8, 1926, Eva and Siegmund were married in the Golden Hall of the Grand Hotel in Stockholm in a huge society affair attended by the Wallenbergs, the Fränkels, and the Swedish banking elite. About two hundred guests were present, with a contingent of more than forty people from Hamburg. Three people officiated over the ceremony: the mayor of Stockholm flanked by the chief rabbi of Stockholm and the Philipson family pastor. At this tense affair, the Jews sat on one side of the aisle, the Christians on the other. Notable among the guests were several dashing young men in brilliant blue military uniforms reputed to be disappointed suitors.

  The wedding pictures convey sadness behind the glitter. Siegmund liked simplicity and he and Eva seem smothered and oppressed by all the pomp. The photos also show that Siegmund was now a mature, sophisticated young man. He was already highly moody and had a fearsome temper. Next to his cubbyhole at the Grand Hotel, one reception clerk pinned a note with the warning, “If he rings, you must RUN” to answer. Following the Stockholm wedding, Siegmund and Eva had a small, private Jewish ceremony in Germany.

  After their marriage, at Max’s direction, Siegmund began an apprenticeship in the United States. In 1927, the newly weds sailed for Boston, where Siegmund worked for the accounting firm of Lybrand Ross Brothers & Montgomery. Their first child, George, was born in Boston. Siegmund loved the American lust for enterprise and freedom from tradition, yet also deplored the cultural homogeneity and standardization. Shocked by his own ignorance of American history, he drew up a reading list and spent a lot of time closeted with his books. Playing Pygmalion, he had Eva read the books, too.

  Before leaving the United States, Siegmund worked with Paul at the IAB and Felix at Kuhn, Loeb in late 1927 and early 1928. In remarkable letters that Siegmund wrote to Eva’s father, it is apparent that he developed a quick distaste for his American relations—which they would richly repay over the years. While he found the Friedaflix children nice and lively, they struck him as indifferent to matters of the spirit and he said that among the Americans he met, he liked his own family least. As with American Jews generally, he thought the New York Warburgs were parvenus ashamed of their roots and trying too hard to be Americanized.

  Siegmund observed the friction between Paul and Morti Schiff and reflected that they were better off in separate firms.21 Though he found Paul hypersensitive, Siegmund was otherwise overcome with admiration for his fine, subtle humanity. He found Jimmy a gifted but frightful bluffer who preferred debating to doing things, got into too many fights with people (especially Uncle Max), and was an unreliable friend. As would happen again in the 1950s, Siegmund saw Kuhn, Loeb as a fading star. For all its strength in the railroad and steel industries, he thought the firm dangerously overloaded with vain, snobbish partners who preferred their hobbies to hard work. It was a prescient insight.

  With his international seasoning and exquisite wife, Siegmund perhaps felt that he had exorcised past hardship. He was a rising young man, who enjoyed his food, wine, and cigars and liked sporty, dapper clothing. Yet there had already been a reminder of fate’s malevolence. This misfortune came from a freak accident. Siegmund had a cousin, the smiling, bespectacled Albert Kaulla, who was like a brother to him. One Christmas at Uhenfels, Albert had accidentally swallowed a thumbtack that did no immediate harm but couldn’t be located by X-rays. The family hoped that someday it would naturally be expelled. Then while Albert trained at M. M. Warburg the thumbtack reappeared, piercing his lung as he exercised one morning. On February 15,1927, he died at age twenty-two. A distraught Siegmund swore to Lilly and Otto Kaulla that he would try to replace Albert and be a son to them.22 When his own son, George, was born seven months later, Siegmund gave him the middle name of Albert.

  Then a flaw appeared in the crystalline perfection of the marriage. On November 1930, Eva, age twenty-seven, gave birth to a daughter, Anna, in Hamburg. When the nurse brought Anna to Eva for breast-feeding, she was disturbed by a spot on Eva’s breast. It was diagnosed as cancer and the breast was removed. Eva’s dignified reaction to this disfigurement showed her inner strength and lack of self-pity. It also started a lifelong struggle with cancer.

  Around this time, Siegmund saw the limits of his prospects at M. M. Warburg. Eric might be agreeable, but Siegmund had no respect for him as a banker. In January 1929, Eric became a partner along with Dr. Ernst Spiegelberg, while Siegmund only graduated to Einzelprokurist, or a holder of the power of attorney, along with Dr. Hans Meyer. Siegmund didn’t become a partner until 1930.

  Now Siegmund began to create distance between himself and Max. For a long time, Siegmund had chided his uncle for not opening a Berlin branch. Max was afraid of offending banking friends and only kept a pied-à-terre there to conduct political talks and entertain clients. Regarding this as foolish obstinacy, Siegmund began to think of Max as a dilettante strategist. He also suspected that the Emperor Maximilian, as he dubbed him, was afraid that he wouldn’t be able to control everything that went on in a Berlin office. Siegmund saw Berlin as a place where he could run his own show and enjoy a sophisticated political and cultural milieu. Unlike other Warburgs, Siegmund found Hamburg hopelessly provincial.

  Siegmund aroused Max’s fury by siding with Jimmy over the need to merge with the powerful Berliner Handels-Gesellschaft. When Max finally agreed to open a Berlin branch in 1931, Siegmund was appointed manager, thus opening his escape route from the Hamburg bank. Apparently he took full advantage of his freedom to the point where Max confronted him, chiding him for keeping him in the dark about his doings and insisting that he file a weekly report on his activities.

  Siegmund would always be steeped in the intellectual world of Weimar Germany. He had intense respect for his Uncle Aby. He also admired Walther Rathenau and Gustav Stresemann, regretting they didn’t inspire the same hero-worship as the militaristic
Hindenburg and Ludendorff. He had a penchant for the bold, sweeping, rather grandiose historical theories that flourished amid the turbulence and decay. He liked strong, unsentimental ideas that provoked thought and shocked the complacent. Devouring Spengler, he was infected by the deep cultural pessimism of the 1920s, which suited his melancholic nature. The notion of global decay, of apocalyptic change, seemed to appeal to him. He responded to Hegel’s view of history as a vast progression of dialectical change. Such theories, which viewed the petty affairs of men from a godlike perspective, suited his pose of intellectual superiority. Fortified by Spengler and Hegel, he floated above the fray.

  Another important influence was Nietzsche, especially Beyond Good and Evil. The philosopher’s contempt for the weak, mediocre conformists of modern Europe struck a deep chord in Siegmund, who had found examples in his own Hamburg family. Siegmund liked the notion that Providence supplied a special dispensation to superior men. He was always interested in the exceptional individual who wished to sweep away the dead encumbrances of the past and start a new order.

  In 1930, Siegmund gave a funeral oration for his uncle, Marc Rosenberg, a charismatic art historian and a dashing freethinker. Siegmund’s speech displayed his flair for theatrics and powerful imagery. He lauded Rosenberg as a lonely visionary, dedicated to high ideals. Rosenberg could well sneer at the cheap applause of the vulgar crowd, for he was the Nietzschean Übermensch. “Lightning and thunder could flash from his eyes, the lightning of vision and the thunder of indignation, an unholy thunderstorm that, far beyond good and evil, tried to crush everything petty and ugly.…”23 For Siegmund, Rosenberg represented a dying breed of true aristocrats, who fought the solitary fight for truth. “He had the most difficult courage that exists, the courage of loneliness and independence.”24 The hyperbole reflected a tendency toward hero-worship that never entirely deserted Siegmund, who, in personal letters and speeches, was often carried away by the mood of the moment.