The House of Rothschild, Volume 1

by Niall Ferguson

  All the themes of Nazi anti-Semitism are here. The Jews have no allegiance to the countries where they live and merely wish to profit from the sufferings of others: “You can only make a lot of money with a lot of blood!” Mayer Amschel (Erich Ponto) tells Nathan (Karl Kuhlmann). Under their direction, “International Jewry” engages in “gigantic speculations” while “soldiers bleed to death on the battlefields.” The Jews are physically different and repellent: Mayer Amschel sports a kaftan and ringlets, while his oleaginous son lusts grotesquely after the wife of his Aryan rival—a typical Goebbels touch. Despite the Propaganda Minister’s apparent dissatisfaction with the film, it appears to have been relatively popular: the secret police reported excitement when it was first released in Berlin and surrounding districts and it also played to large audiences in occupied France. When a British prisoner-of-war was leafing through a German newspaper in January 1945, he was so amazed to find a version of the story on the front page that he translated it and took it home when the war was over.

  It is instructive to compare Waschnek’s film with its American precursor and model, The House of Rothschild, directed by Darryl Zanuck in 1934 and starring George Arliss as both Mayer Amschel and Nathan. In the earlier film, the Rothschilds are portrayed sympathetically: their rise from rags to riches is a version of the “American dream” (complete with a wholesome romance between a Rothschild daughter and the dashing young British officer who brings the news of victory at Waterloo), while the obstacles they confront—the sinister Prussian Minister Baron Ledrantz (Boris Karloff) and rioting mobs in Frankfurt—allude to contemporary developments in Germany. Yet even the American version of the Rothschild story is largely myth, much of which could be construed in a less sympathetic light. Mayer Amschel may be a lovable old man with a twinkle in his eye and matinée idols for children; but he still has a plan for world domination. Indeed, in places the films are like mirror images of one another. In Waschnek’s version, Nathan draws a map of Europe to show the centres of Rothschild power and a family tree which, when its branches are connected, forms a Star of David; the flaming star is then superimposed over a map of England with the accompanying title: “As this film was being completed, the last members of the Rothschild family are leaving Europe as refugees and escaping to their allies in England. The fight against British plutocracy continues!” The Zanuck film uses very similar imagery: on his deathbed, Mayer Amschel tells his five sons to go to the various European cities. These are then depicted on a map, and a Star of David is again superimposed. However, the concluding sequence of the film emphasises the parallel between Nazi anti-Jewish policy and the “Hep” riots against the Frankfurt Jews in 1818. In essence, then, the two films tell the same story, albeit with the moral signs pointing in opposite directions.

  This Janus-faced quality to the cinematic representations of the Rothschilds’ early history is symptomatic of a more general ambiguity. For there is a sense in which all the various Rothschild legends can be thought of as a single myth—a myth of immense wealth; of meteoric social ascent; of limitless political and diplomatic power; and of some enigmatic ultima ratio, connected with the family’s religion. Usually, the myth is told in pejorative terms: the wealth is ill-gotten, the social ascent unsuccessful, the power based on corruption and the objective sinister. But it can equally well be told in the Hollywood style, as a tale of economic over-achievement, social success, legitimate power and moral ends. Other subjects exploited by the Nazis for their propaganda have, of course, since become taboo—and in some countries even illegal. But the ambivalent quality of the Rothschild myth seems to guarantee its constant replication and modification. This is perhaps most obvious in France. Parts of the special edition of the magazine Crapouillot published in 1951 were undoubtedly anti-Semitic, reproducing the stories (and cartoons) from the nineteenth century radical and right-wing literature; but other “grandees” included in the magazine were not Jewish, and the tone of the text as a whole was relatively temperate. As the work of writers like Coston and Peyrefitte shows, it was possible in the atmosphere of the Fourth Republic to repeat more or less verbatim the old legends about the “200 families who rule France” with only a slight modification of tone. Typically, when the former de Rothschild Frères director Georges Pompidou became Prime Minister in April 1962 (and later President in 1969), le Canard enchaîné commented simply: “RF = République française = Rothschild frères.” However, similar echoes of the Rothschild myth can be found in the British press too. Hostile inferences were sometimes drawn in the 1980s from the fact that a number of Conservative politicians had worked for N. M. Rothschild & Sons Limited either before or after their political careers, at a time when the firm was handling a number of important privatisations. Indeed, the Labour Shadow Chancellor Roy Hattersley went so far as to allege a “correlation between contribution to the Tory party and the receipt of business from Government” following the first Rothschild privatisation—an allegation he was later forced to withdraw.

  Nowhere is the continuing vitality of the Rothschild myth on the lunatic fringe more apparent than in the writings of David Icke, the erstwhile environmentalist turned “New Age” evangelist. According to Icke, the Rothschilds are members of the “Global Elite or Brotherhood”—also referred to as the “All-Seeing Eye Cult” and the “Prison Warders”—which secretly rules the world. Ever since the time of Mayer Amschel, they have “manipulated governments and worked through the Brotherhood network to create wars and revolutions.” They are the hidden power which “controls” other well-known banks such as Warburgs, Schroders and Lazards, as well as being “behind” American financiers such as J. P. Morgan, the Rockefellers, Kuhn, Loeb & Co. (an “obvious Rothschild front”), the Speyers and the Lehmans—not to mention the Bank of England and the Federal Reserve system. Through this network of global power, they have been responsible for, among other things: the murder of Abraham Lincoln; the Boer War; the creation of Israel (a gambit to control the oil of the Middle East); the Russian revolution (“a coup on Russia by the United States financial arm of the Global Elite largely controlled by the Rothschilds”); the financing of Hitler; and even the floating of the dollar by President Nixon. Today, Icke alleges, they and their associates in the Conservative party and the press are plotting to monopolise the world’s energy supplies—hence their interest in electricity, coal and gas privatisation.

  A cursory search of the Internet reveals a plethora of equally bizarre conspiracy theories. A “Study of Corporate and Banking Influence” by Don Allen purports to show the “linear connection” between the Rothschilds, the Bank of England and the Federal Reserve. The “A-albionic Research Weekly” by James Daugherty claims to have identified “The ‘World Money Cartel’ or ‘Empire of the City (of London)’ operated for the ‘Crown’ by the ‘legendary’ Merchant Bankers of the Bank of England, including the Warburgs, Rothschilds [and] Barings.” “Scriptures for America” gives a more elaborate version of Icke’s claims about the economic rationale behind Rothschild support for Zionism, “the single purpose” of which is supposedly “to secure permanent and secure access to [the] vast natural resources in the Far East.” In a similar vein, Sherman H. Skolnick’s “Conspiracy Nation” repeats the claim that the Rothschilds “arranged the murder of President Lincoln,” as his “post-war policies would have wrecked [their] commodity speculations.” Skolnick also repeats the allegation that “the Rothschilds . . . financed the rise of Hitler as a bulwark against the Soviet Union,” adding by way of “explanation” that “the Rothschilds are interwoven with the Catholic Church and, jointly with the traditional mafia and the American CIA, interlocked with the Vatican Bank, which was pro-Nazi.”

  Such surreal libels are not confined to the Internet. The television preacher and Republican politician Pat Robertson’s book The New World Order (published in 1991) states that the Rothschilds were “polluted by the occultism of . . . Illuminated Freemasonry” and that “Paul Warburg, architect of the Federal Reserve System, was a
Rothschild agent.” From a completely different political milieu, Khalid Muhammad—a former assistant to Louis Farrakhan, the leader of the radical African-American organisation Nation of Islam—has repeated the suggestion that “the Rothschilds . . . financed Hitler” and “aided” his anti-Semitic policies; as well—needless to say—as “gaining control of” the Bank of England and the Federal Reserve system. It might be thought that a serious banking history should scrupulously avoid reference to this kind of nonsense. Yet it is impossible to appreciate the need for a scholarly history of the subject if one blithely pretends such myths do not exist.

  IV

  Part of the purpose of this book, then, is to supplant Rothschild mythology with historical reality, in so far as that can be “reconstructed” from surviving documentary evidence. It might be wondered why this has not been done before; why only a tiny fraction of the books which purport to be about the Rothschilds are in fact based on serious archival scholarship. Part of the answer, of course, lies in the enduring appeal of a rich and successful family to hack writers, who are always able to turn a penny by rehashing the myths and anecdotes already in print. Another reason is that, until recently, it was far from easy to gain access to the relevant documentary material. Tragically, the vast archive of the Frankfurt house—which also included all that had been kept of the Naples house’s papers—was largely destroyed in 1912, with the exception of a very few early documents which were sent to Paris.4 Part of the archive of the Vienna house was confiscated by the Nazis in 1938 and passed into Soviet hands at the end of the war along with various papers belonging to members of the French family which were seized during the German occupation. This material lay buried in the Moscow “trophy” archive of the KGB throughout the Cold War and became available to outside researchers at the Centre for the Preservation of Historical Documents only in 1990.5 When Count Corti wrote his two-volume study of the “Rise” and “Reign” of the Rothschilds in 1927-8, he had to rely mainly on the Austrian state archives and the published correspondence, memoirs and diaries of nineteenth-century politicians. The archive of the London house was not generally open to scholars before 1978, though members of the family and “insiders” like Lucien Wolf made use of documents there to produce a number of important monographs.

  On the other hand, the archive of the French house—the basis of Bertrand Gille’s monumental two-volume study published in the 1960s—was deposited in the Archives Nationales following the nationalisation of Banque Rothschild in 1981. Considering the wealth of material which has been available in both Paris and London since the family began to relax its restrictions on access, it is remarkable how little serious research has been done. A mainly social and political history of the English family and a handful of articles and monographs on quite specialised subjects is a relatively low yield for such important—indeed, in many ways unique—documentary collections. Even the volume of essays produced to coincide with the successful 1994-5 exhibition at the Frankfurt Jewish Museum entitled The Rothschilds: A European Family contains relatively few contributions based on new archival research. Pauline Prevost-Marcilhacy’s volume on Rothschild architecture is the only book to date which has made use of all the major Rothschild document collections in London, Paris and Moscow.

  There is, however, a further explanation for this relative lack of scholarship, and that is the intractability of so much of the material. There is a vast amount of it. “We Rothschilds are inveterate scribblers,” wrote Charlotte de Rothschild to her children in 1874, “and cannot live without letter writing and letter receiving.” It was only too true. The most important letters in the London archive are the so-called “private letters” (the XI/109 series) between the partners in the bank, which cover the years from 1812 to 1898. Altogether, these fill 135 boxes. Of these letters, I have referred to around 5,000 in the text. (To give an idea of the relative importance of this series, the final database of letters which I and my researchers wholly or partially transcribed from all archives contains around 13,000 entries.) The frequency of this private correspondence—which was private in the sense that, with a few exceptions, only the partners and the scribes they occasionally used saw it—varied enormously, depending on the volume of business, political news, the number of partners in the various offices and the time of year. Sometimes the partners in Paris might send out only two or three letters in a quiet week; but at peaks of activity, three partners might write one or sometimes two letters a day. To give a single example, in March 1848, the London partners received at least sixty important private letters from their partners on the continent. These letters were often quite lengthy, especially in the early years of the partnership, when Amschel and Salomon routinely sent their brothers five or six sides, mingling political news, financial information, business enquiries and answers with family gossip and personal grumblings. These were, it might be said, the telephone calls of the nineteenth-century, in that they contain the kind of information businessmen today rarely commit to paper. They were also, it should be stressed, untypical by nineteenth century standards. Firstly, because their partners were not so geographically dispersed, few if any of the Rothschilds’ rivals corresponded in this way on a regular basis. It is unlikely that a comparable series of letters exists in any other banking archive. Secondly, because the Rothschilds were exceptionally well connected, the political intelligence their letters contain was usually of a very high quality. James did not exaggerate when he spoke in the 1840s of being able to see King Louis Philippe “daily”: at times of political crisis, he could do just that. His letters to London—the series which I have used most fully—constitute one of the most remarkable sources for nineteenth-century financial and diplomatic history.

  There are only two causes for regret. There is a substantial and unexplained gap in the XI/109 series for the period 1854 to 1860, and after 1879 it trails off (though the letters from Paris in the series XI/101 continue up until 1914). More seriously, nearly all the copies of the outgoing letters from the London partners (in so far as these were made at all) were destroyed at the orders of successive senior partners. All that survive are eight tantalising boxes covering the period 1906-14. We therefore have precious few letters by Nathan compared with the thousands from his brothers which have survived; only a frustratingly small number from his eldest son Lionel; and next to nothing from his grandsons for the period before 1906. It should also be said that relatively few non-business letters by the partners were preserved; indeed, the first Lord Rothschild insisted that all his private correspondence be burnt after his death (though I have been able to find a number of letters in the archives of politicians to whom he wrote). If at times the history of N. M. Rothschild & Sons seems to have been written from the point of view of their continental relatives, that is an unavoidable consequence of this imbalance in the sources. We are fortunate that Nathan’s sons (especially Nat) spent a good deal of time on the continent and that their letters “home” to their parents and brothers have been preserved; but these are no substitute for the letters written from London. By comparison, I have been unable to do more than take occasional samples from the even more voluminous general and private correspondence from the various Rothschild agents—particularly those in the major agencies in Madrid, Brussels, St Petersburg, New York, Mexico and San Francisco. There is an equally huge amount of mostly routine business letters from less important firms who merely acted as “correspondents” or did occasional business with the Rothschilds: again, I have had time only to dip into these letters, which came from as far afield as Calcutta, Shanghai, Melbourne and Valparaiso.

  A further difficulty—which explains why the XI/109 files have never before been fully utilised by historians—is that, up until the late 1860s, all of the second generation and a number of key figures in the third generation of partners (as well as a few of the firm’s agents) corresponded with one another primarily in Judendeutsch: German written in Hebrew characters. This was partly because it was the family’s first la
nguage. But it was also partly to ensure that prying eyes would not be able to read the firm’s private correspondence. The difficulty which even Hebrew readers find in deciphering the relatively archaic script used by the brothers has deterred previous scholars, who have been content to rely on the highly selective English extracts translated somewhat freely by a group of refugees from Germany employed as researchers in the 1950s (the so-called “T” files), or on the letters written by Nathan’s children in easily legible English. However, the heroic work of Mordechai Zucker in translating or reading aloud the original letters on to tape has removed this obstacle for me, making available for the first time a “virgin” historical source of the very first importance.