by Ron Chernow
Throughout the 1950s, Jimmy produced numerous books designed to steer the Democratic party in a more liberal direction and he often discussed policy with such figures as George Kennan, John Kenneth Galbraith, and Arthur Schlesinger. After John F. Kennedy’s election in 1960 and a sudden progressive upsurge, it looked as if Jimmy’s moment had at last arrived. He was a hero to young idealists who swarmed down to Washington. After the election, Stevenson gave John F. Kennedy one of Jimmy’s foreign-policy memos for his inaugural address, saying, “Jim Warburg is very anxious for you to see this personally and has asked me to be the conduit. I am glad to do so, because I have found that whatever he says is arresting and often prescient.”22
In April 1961, John J. McCloy asked Jimmy to become an economic-disarmament consultant for the State Department. For the first time in almost three decades, he was invited to become a government wise man again. The historical turnabout, alas, had come too late. That year, Jimmy underwent radical treatment for carcinoma of the tongue, surgeons removing glands on the right side of his head and neck and half his tongue. Suddenly weak and suffering from impaired speech that made him self-conscious, the articulate Jimmy had to curtail his lecture schedule.
He began to winter with Joan in Deerfield Beach, Florida, where they lived a simple life without servants and did their own cooking. They had a pretty banyan tree and Jimmy also planted white hibiscus bushes, mimosa trees, and Norfolk Island pine. He designed a restaurant and built luxurious high-rise buildings, making yet another fortune. As with many Warburgs, he had a golden business touch that he held of little account. He cared passionately about politics, ideas, and the arts. He chaired the board of the Juilliard School of Music and was a director of the New York Philharmonic Society.
While Jimmy welcomed Eric’s efforts to restore the Warburg name, he hadn’t placed much stress on such family matters in thirty years. Eric championed West German integration into NATO and Jimmy held a diametrically opposed view. Eric found Jimmy extreme and dogmatic in his views and said arguing against him was like tilting with windmills.23 So Eric was absolutely stunned in 1963 when Jimmy suddenly wrote out of the blue and proposed a sentimental journey to Germany. Not only did he want to visit Kösterberg and the Hamburg bank with twelve-year-old Jimmy Jr., but he wanted to go with Eric and his teenage son, Max, for a tour of the ancestral town of Warburg. “I have in recent years missed some of the warmth and intimacy of a family hearth wider than one’s own immediate circle of wife and children,” Jimmy wrote.24 Hence, Eric, Jimmy, and their sons journeyed to Warburg where the mayor led them to the ancient Jewish cemetery, the Judengasse, and other shrines. Jimmy completed this pilgrimage despite a torn ligament in his foot that forced him to hobble about with his leg in a cast.
The rapprochement with Eric was brief. A year later, when Jimmy published his memoirs, the reticent Eric was appalled at the indiscretions and complained that Jimmy was still the “dangerously ill boy” he had always been.25 Jimmy never ceased to scandalize his more conventional Warburg relatives. In 1963, this offspring of a conservative banking family became a major donor to the new leftish Institute for Policy Studies. Five years later, he supported the insurgent candidacy of Senator Eugene McCarthy and was a vocal critic of the Vietnam War. He remained a brilliant, uncompromising iconoclast until the end. In 1969, at age seventy-two, Jimmy Warburg had a stroke and died in a Greenwich, Connecticut, hospital. He joined his parents in the Sleepy Hollow Cemetery.
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Eric had taken an enormous gamble in returning to Hamburg. He had gambled that he would regain control of the bank from the Brinckmanns and vindicate the family’s honor. He had gambled that his reluctant family would follow him. He had gambled that his story wouldn’t recapitulate the sorry saga of the Warburgs in Germany. Most of all, he had gambled that his lone son, Max, would enter the bank and sustain the tradition that he had so laboriously revived. His older daughter, Marie, had become an internist at Beth Israel Hospital in Boston and Erica a landscape architect in Germany. Eric’s unending battle with Brinckmann only made sense if he were preparing the way for young Max. The central question was: Could he coax his son into taking upon his shoulders the weighty, complex burden of Warburg history?
Almost fifty years younger than his father, Max had a different approach to things. As an Old World merchant banker, Eric possessed infinite layers of mystery and discretion. Max had his good looks, humor, and charm, but he was very American in his straightforward, outspoken style. He had a lot of his grandfather’s bright energy and dash and was sometimes too impetuous for the finer points of diplomacy in which Eric specialized. As a student at Heidelberg in the late 1960s, he wrote radical tracts against multinational companies. Only gradually did he awaken to the mighty tradition that fate had bequeathed to him.
However eager Eric was to see Max enter the bank as a sixth-generation Warburg, he knew his son was very independent and that any heavy-handed tactics would backfire. He cleverly used various devices to lure him into banking. When Max was a teenager, Eric sometimes brought him to the bank when money was being transported by armed guards in an armored truck—the sort of thing to excite a boy’s imagination. He ensured that Max was exposed to the elite of the banking world. “Eric used to trot young Max around like a pet monkey on a leash to meet the Rothschilds and other such types,” said Eddie Warburg.26 Whenever Max slouched at the table or showed bad table manners, Eric would both rally and reproach him by saying, “Think of how the Rothschilds would do it!” Having fathered his son at age forty-eight, Eric was eager to have Max go through a speedy apprenticeship and enter the bank. He constantly feared that he would die before Max could succeed him as a partner.
Despite this often uncomfortable parental impatience, Max insisted upon securing a better, if more leisurely, education. Becoming a German citizen in 1970, Max studied law and economics then received a first-rate banking education at Chase Manhattan and E. M. Warburg, Pincus in New York. He also apprenticed with Siegmund in London. Early on, Siegmund saw that Max was able and enterprising and it must have irked him that Eric had the son with banking in his veins. Siegmund knew one way to take over the Hamburg bank was to take over Max. So he closely studied the young man. Even when Max was a student, Siegmund would send him handwritten notes in the knowledge that German etiquette demanded a handwritten reply. Aware that Siegmund wanted to analyze his handwriting and probe the inner recesses of his psyche, Max would always borrow a typewriter to reply.
While acknowledging his father’s capacity for acquiring clients, Max made no bones about his shortcomings as a banker. Yet he adored his father and it grated on him that Siegmund would bad-mouth and belittle his father in front of him. Finally, he had to protest in exasperation, “Please, Siegmund, you’re talking about my father. I will not accept this.”27 Knowing the cargo of dreams that Max carried for Eric, Siegmund had tried to seduce him with tempting offers to become a managing director of S. G. Warburg & Company. Max came to see Siegmund as an extraordinary banker but his father as the man of superior character.28
The late 1970s witnessed no less than five separate merger negotiations to unite M. M. Warburg-Brinckmann, Wirtz & Co. with Siegmund’s Effectenbank-Warburg in Frankfurt. Despite his turbulent, mixed-up history with Siegmund, Eric strongly endorsed the proposed merger, which would have created the largest private merchant bank in Germany. He thought Frankfurt would emerge as the German money center and that it made little sense to vie with Siegmund there. He also believed their two operations had matching strengths.
Siegmund had little patience with the Brinckmanns and two other Hamburg partners and they played a constant game of one-upmanship. When Eric suggested meeting in Hamburg or Frankfurt to discuss a merger, Christian Brinckmann insisted upon the neutral territory of Cassel. The official explanation for these failed talks was that the two sides differed about the concept. The real reason was that the Brinckmanns and their allies thought Siegmund would dominate the new entity. Eric disputed this, citi
ng the diverse shareholder group that would control the bank. But even he had soured on the deal by the end.
After the collapse of these talks, Max went to visit Siegmund at Blonay one day. The two had grown somewhat closer. When Siegmund started groaning about the Hamburg partners and wondering why he held on to his stake there, Max stunned him by asking if he could buy his stake. He said the time had come for the Mittelweg and Alsterufer Warburgs to get out of each other’s way and be friends again. On the spot, Siegmund agreed.
On January 1, 1982, Eric retired and Max became a partner with Siegmund’s small stake. Thus ended Siegmund’s dream of controlling a great Warburg bank in Germany. By that point, Siegmund had little fellow feeling for the Hamburg bank, which he sneered at as second-rate. He and Eric would see each other once or twice a year and talk on the telephone, but the relationship had cooled. In 1985, S. G. Warburg sold the Effectenbank, which had never flourished in corporate finance and whose credit business didn’t square with the parent company’s strategic vision.
Eric’s battle with Siegmund may have ended, but not the internal one against the Brinckmanns. Segmented into separate baronies, the firm was paralyzed by the ancient feud. With a 23 percent stake and veto power over major decisions, Dr. Christian Brinckmann lacked an ambitious agenda for the bank. In 1986, Max brought in Dr. Christian Olearius, a managing director of the Norddeutsche Landesbank in Hannover. Olearius shared Max’s vision and complemented his talents: Max thrived in investment banking and rapidly changing markets, Olearius in commercial banking. They had a stalwart ally in Hans-Dieter Sandweg, but faced opposition from Dr. Christian Brinckmann and Dr. Hans Stracke. In 1987, Eric had a massive heart attack at the bank and stopped working that day. Henceforth, Max and Olearius carried the brunt of the battle.
After lengthy negotiations, the perplexing stalemate of many decades gave way to a stunning, almost magical, series of upheavals. First came the tremor of late 1988 when Stracke left the firm, followed by the full-scale earthquake of June 1989, when the Brinckmanns withdrew. Then the ailing Sand weg left and the Industriekreditbank (IKB) sold its 20 percent stake. This dramatic exodus left Max, age forty-one, and Dr. Olearius in charge. Through a leveraged buyout, they bought the nearly 45 percent share of the Brinckmanns and the IKB. Boosting their own stakes, they also resold portions to a group of friendly local investors, including cigarette heiress Gertrud Reemtsma, publisher John Jahr, and Hildegard Thoennes of the Voss margarine family. For the first time since 1938, the Warburgs, along with Dr. Olearius, had recaptured full managerial control of Hamburg’s largest private bank and one of the largest in Germany, with more than five hundred employees. There were no more institutional owners. “We are again a purebred private bank,” Max exulted to the press.
The bank began to thaw out from the deep freeze of the partnership struggle.29 Max and Olearius mapped out an audacious strategy for a more universal bank. They started to create a stock-research department, to expand into major financial capitals, to issue interest and currency options, to push hard on mergers and other corporate-finance activities, to advise on real estate, and to expand trading and money-management operations.
These changes amazed and delighted Eric, who had been tossed on the waves of the twentieth century. “I was like a fish in a stormy sea,” he once said, “now on the crests of the waves, now in their troughs.”30 During the Hitler period, the Warburgs had been stripped of their worldly goods. Eric had lived to enjoy a hero’s return to Hamburg and to see the dread events of 1938 reversed. Where he and his family had been persecuted, he was now honored. In January 1988, the Atlantik-Brücke awarded to Eric himself its first Eric M. Warburg Prize for advancing German-American friendship. Because Eric was now infirm, the West German president, Richard von Weizsäcker, came to Kösterberg to award the prize. The son of a Third Reich official convicted at Nuremberg, Weizsäcker acutely (although he had not escaped criticism for his postwar defense of his father) felt the solemn obligation of the German people to make amends to the Jews. Dorothea Warburg, who had agonized over the move to Germany almost thirty years before, accepted the award in a small ceremony on the ground floor. Then Weizsäcker tiptoed up the old, squeaky stairs and spent several minutes alone with Eric, who lay in bed.
Toward the end, Eric’s mind wandered and he often didn’t recognize people. But he would suddenly become lucid on selected topics. When the Berlin Wall fell, he exclaimed, “It’s unbelievable! I never would have thought it would happen. And, you know, what impresses me most—it’s being done with such dignity.”31 After German reunification, Hamburg regained the Elbe hinterland that had accounted for much of its early maritime importance. Once again it was Gateway to the World and Germany resumed its place as the preeminent Continental power.
However clouded, Eric’s mind was wont to clear on any matters pertaining to the bank or the name change. On his ninetieth birthday in 1990, Max brought him two and a half pounds of caviar—what Eric had termed the “black vegetable” as a boy. At this celebration, Max thanked his father for moving back to Germany. Then one day, about to go off sailing in Scandinavia, Max had the unutterable pleasure of informing his father that the bank had dropped “Brinckmann, Wirtz & Co.” from the name. Starting on October 1, 1991, it would be called M. M. Warburg Bank on its logo and the pristine M. M. Warburg & Co. on the registry books—just as it had been from 1798 to 1938. Eric fully comprehended and it seemed nothing short of a miracle, a last-minute present from the gods. Dwarfed by the great joint-stock banks such as Deutsche Bank, M. M. Warburg was not the great prize it had been before the war. The role of the private banker was much more circumscribed in the modern world. But destiny had granted the Warburgs a chance to amend a terrible wrong.
On July 9, 1990, Eric died of cardiac arrest at age ninety in the old wooden hilltop house and former country inn that Moritz had purchased a century before. Even in death, Eric evinced the conflicted emotions toward Judaism that had distinguished his family’s history and that of German Jewry. He had asked to be buried in the non-Jewish side of the cemetery, near a large stone marker that commemorated the baptized Altona Warburgs who had died in the concentration camps. In this way, Eric both held aloof from his fellow Jews and expressed his solidarity at once. A characteristic last act.
Despite his charitable work, the local Jewish community wouldn’t perform burial rites in the non-Jewish side of the cemetery—as Eric must have known. About a thousand people, including many reporters, wanted to attend the funeral, yet Eric’s family knew he would have favored his usual discretion. So a small knot of friends and family members stood by an open grave at eight o’clock one morning. Eric was the first Warburg banker buried on German soil since the Holocaust. Max read aloud prayers and speeches in German and English, but not in Hebrew. He wanted to conduct the ceremony in a way that seemed appropriate to his father.
Germany had regained the status quo ante of the pre-Hitler days by the time of Eric’s death, but it conspicuously lacked one feature. The Jewish population of a unified Germany numbered somewhere between forty and fifty thousand people—about one tenth the pre-1933 number. Most were descendants of Ostjuden who had survived the concentration camps. Even as a fresh wave of Jews poured in from the Soviet Union, it was still unclear to what extent Germany had eradicated its long-standing anti-Semitism. A recrudescence of neo-Nazi activity, marked by more than two thousand attacks on foreigners and the desecration of many Jewish cemeteries and synagogues in 1992, posed the momentous question of whether Germany had genuinely fathomed the lessons of its troubled past. Had its postwar atonement been merely an exercise in public-relations piety?
As German Jews, the Warburgs didn’t regard this question as an abstract matter, for they were ready to write a new chapter of the story. In 1992, Max, forty-four, married a tall, slim, quite striking twenty-four-year-old journalist named Alexa Chrambach, who was one-quarter Jewish; they spent their honeymoon in Israel. No less eager than his father to right past wrongs, Max join
ed efforts to establish a new Warburg Institute in Aby’s old library building at 116 Heilwigstrasse. It was supposed to supplement, not supplant, the London institute. For the first time since the 1920s it seemed that meetings and seminars might be held in the famous elliptical reading room. Supporters of the project hoped to accomplish this by 1994 as a way of marking the seventy-fifth anniversary of the University of Hamburg that Aby had helped to found. And, indeed, in July 1993 the city of Hamburg completed negotiations to purchase the Heilwigstrasse house. The rediscovery of Aby and his forgotten world now seemed complete.
Like a Brahms symphony, the Warburg saga had been long and melancholic, sad but touched with hope, brave and strangely inspiring all at once. As German Jews, the family had known the sweetest rapture, the deepest torment, the most exquisite vindication. Fate had pommeled them many times yet they had survived, endured, and prospered anew. But as the generations changed in Hamburg, a tacit question disturbed the air. Was the germ of anti-Semitism finally dead in Germany? Or was it only dormant and waiting to flare up again? Had the Warburgs come back in vain?
APPENDIX
ANALYSIS OF THE HANDWRITING OF SIR SIEGMUND WARBURG
Thinking it time to turn the tables on him, I asked a distinguished American graphologist to analyze the handwriting of Sir Siegmund Warburg. Thea Stein Lewinson spent eighteen years working for the Central Intelligence Agency and has coauthored a book called Handwriting Analysis. When I contacted her, I disclosed the subject’s name. She was vaguely aware that Siegmund Warburg was a banker and knew that his firm employed handwriting analysis. Otherwise she betrayed no special knowledge of him and wasn’t even aware that he had died ten years earlier. I furnished her with two specimens of Sir Siegmund’s handwriting—a long business letter written in the 1950s and a shorter, more personal note written toward the end of his life. Ms. Lewinson inquired only about his educational background, nationality, and age at the time he wrote the letters. Below, I reproduce verbatim the remarkable report she sent me.
