by Paul Johnson
These delays and uncertainties explain why so many Jews took their ticket to society through baptism. But there were other solutions to the ‘problem’ of being a Jew in the nineteenth century. To many Jews, the ideal one had been found by the Rothschilds. They became the most illustrious exponents of the new phenomenon of eighteenth-century finance, the private bank. Such private finance houses were founded by many Jews, chiefly descendants of court Jews. But the Rothschilds alone escaped both baptism and failure. They were a remarkable family because they contrived to do four difficult and often incompatible things simultaneously: to acquire immense wealth quickly and honestly; to distribute it widely while retaining the confidence of many governments; to continue to earn huge profits, and to spend them, without arousing popular antagonism; and to remain Jewish in law and, for the most part, in spirit too. No Jews ever made more money, spent it more self-indulgently, or remained more popular.
Yet the Rothschilds are elusive. There is no book about them which is both revealing and accurate.7 Libraries of nonsense have been written about them. For this the family is largely to blame. A woman who planned to write a book entitled Lies About the Rothschilds abandoned it, saying: ‘It was relatively easy to spot the lies, but it proved impossible to find out the truth.’8 The family was highly secretive. That was understandable. They were private bankers. They had confidential relations with several governments as well as innumerable powerful individuals. They were Jews, and therefore particularly vulnerable to destructive litigation. They kept no more documentation than was necessary. They systematically destroyed their papers, for all kinds of personal as well as business reasons. They were particularly concerned that no details of their lives should be used to promote anti-Semitism. So their deaths were followed by holocausts of private papers even larger and more drastic than those of Queen Victoria’s family. Their latest historian, Miriam Rothschild, believes there was a further reason. They kept no muniment room. They were not interested in their history. They were respectful towards their ancestors, as a matter of good form, and prudently thought about tomorrow. But they lived for the present and did not care deeply about past or future.9
All the same, the salient facts about the Rothschilds are clear enough. They were a product of the Napoleonic Wars, just as the first phase of large-scale Jewish finance was a product of the Thirty Years War, and for the same reason: in wartime, Jewish creativity comes to the fore and gentile prejudice goes to the rear. In all essentials, the family fortune was created by Nathan Mayer Rothschild in London. What happened was this. Until the beginning of the revolutionary wars in France, in the mid-1790s, European merchant banking was dominated by non-Jews: the Barings of London, the Hopes of Amsterdam and the Gebrüder Bethmann of Frankfurt. The war quickly expanded the money-raising market and so opened room for newcomers.10 Among them was a German-Jewish group—Oppenheims, Rothschilds, Heines, Mendelssohns. The Rothschild name derived from the sixteenth-century red shield on their house in the Frankfurt ghetto. The family patriarch, Mayer Amschel (1744-1812), was a money-changer who also traded in antiques and old coins. He branched into textiles, which meant a British connection, and from selling old coins to William IX, Elector of Hesse-Cassel, he became his main financial agent. The elector had made himself very rich by supplying mercenaries to the British army. So that was another English connection.
In 1797 Mayer Amschel sent his son Nathan to England to attend to his affairs there. Nathan went to Manchester, the centre of the first phase of the Industrial Revolution and of what was rapidly becoming a world trade in cotton manufactures. He did not make cottons himself but bought them from small spinners, sent them out for printing, and then sold the finished product to Continental buyers direct, by-passing the fairs. He thus pioneered a path later trodden by other Jewish textile families: the Behrens in Leeds, for example, and the Rothensteins in Bradford.11 Nathan’s direct-selling method involved giving three months’ credit, and that in turn meant access to the London money market. He had already ‘studied’ there under his father’s connection, Levi Barent Cohen, and married Cohen’s daughter Hannah. In 1803 he transferred his operations to London, in time to enter the government loan business as the war expanded. The British government needed to sell £20 million of loan stock every year. The market could not absorb this amount directly, so portions of it were sold to contractors who found customers. Nathan Rothschild, who had already established a good reputation for his bills of exchange in the textile trade, participated in these contractor syndicates and at the same time acted as an acceptance house for international bills of exchange.12 He had one enviable advantage in getting working capital. After the disastrous Battle of Jena in 1806, the Elector of Hesse-Cassel sent his fortune to Nathan in London for investment in British securities, and Nathan built up his own resources while serving William IX’s interests too. Thus Nathan’s reputation in the City was established. But he also excelled in the traditional Jewish skill of transferring bullion quickly and safely under trying conditions. In the six years 1811-15, Rothschild and the British Commissary-in-Chief, John Herries, contrived to get £42.5 million in gold safely to the British army in Spain, of which more than half was handled by Nathan himself or by his younger brother James, operating from France.13 By the time of Waterloo, the Rothschild capital was £136,000, of which Nathan in London had £90,000.14
James’s operations in Paris from 1811 marked the expansion of the family network. A third brother, Salomon Mayer, founded a Vienna branch in 1816, and a fourth, Karl Mayer, set one up in Naples in 1821. The eldest son, Amschel Mayer, ran the Frankfurt branch after the old patriarch died in 1812. This network was ideally suited to the new era of peacetime finance which opened in 1815. Raising the vast sums needed to pay the armies had brought into existence an international finance system based on paper and credit, and governments now found they could use it for all kinds of purposes. In the decade 1815-25 more securities were floated than in the whole of the preceding century, and Nathan Rothschild gradually succeeded Barings as the principal house as well as London’s top financial authority. He did not deal with volatile Latin American regimes but mainly with solid European autocracies—Austria, Russia, Prussia, known as the Holy Alliance; he raised an enormous sum for them in 1822. He handled seven of the twenty-six foreign government loans raised in London, 1818-32, and one jointly, making a total of £21 million or 39 per cent of the whole.15
In Vienna, the Rothschilds sold bonds for the Habsburgs, advised Metternich and built the first Austrian railway. The first French railways were built by Rothschild Frères in Paris, who also raised money, in turn for Bourbons, Orleanists and Bonapartes, and financed the new king of Belgium. In Frankfurt they floated issues on behalf of a dozen German thrones. In Naples, they raised money for the government there, for Sardinia, Sicily and the papal states. The combined Rothschild capital rose steadily, to £1.77 million in 1818, to £4.3 million in 1828, to £34.35 million in 1875, of which the London house controlled £6.9 million.16 The wide spread of the network’s contacts made the money-power the firm could actually deploy very much greater. They exploited to the full the traditional Jewish flair for news-gathering and transmission. Jews by mid-century were already turning from banks to wire-services. Paul Julius Reuter (1816-99), whose name was originally Israel Beer Josaphat, left his uncle’s bank in Göttingen to set up the world’s greatest news-agency in 1848. Adolf Opper, or as he called himself Adolphe Opper de Blowitz (1825-1903), made himself, as The Times Paris correspondent, the centre of Europe’s finest personal news-network with private telegraph lines when necessary. But no newspaper has ever been better served with key financial news than the Rothschilds. As late as the 1930s, their couriers were still recruited in the Folkestone area, descendants of the sailors who took cutters carrying dispatches across the Channel in the age of Waterloo.17
Unlike the old court Jews, the new kind of international firm the Rothschilds created was impervious to local attack. In 1819, as if to demonstrate that new
ly acquired Jewish rights were illusory so far, anti-Semitic violence broke out in many parts of Germany. These ‘Hep Hep’ riots as they were called (perhaps after a crusader war-cry, or more likely after a goat-drover’s call from Franconia) included an assault on the Rothschild house in Frankfurt. It made no difference. Nor did a further attack during the 1848 revolution. The money was no longer there. It was paper, circulating through the world. The Rothschilds completed a process the Jews had been working on for centuries: how to immunize their lawful property from despoiling violence. Henceforth their real wealth was beyond the reach of the mob, almost beyond the reach of greedy monarchs.
Nathan Mayer Rothschild, the financial genius who made the firm’s fortunes, died in 1836 in Frankfurt, while attending the marriage of his eldest son Lionel to Charlotte, daughter of his brother Karl, head of the Naples branch. The Rothschilds nearly always married each other: when they spoke of ‘marrying out’ they did not mean out of Jewry but out of the family. The object of intermarriage was to keep dowries within the firm; though it was said that wives’ settlements were usually shares the men wanted to unload, such as South American railway stock.18 The Lionel-Charlotte wedding was celebrated at the old family houses in the Judengasse, where the eighty-four-year-old matriarch, born Gudule Schnappers, who had produced nineteen children, still lived: she was to survive another decade. Nathan’s death was a matter of considerable importance: the carrier-pigeon dispatched to London with news of it was shot down over Brighton and was said to have borne the cryptic message, ‘Il est mort.’19 But his branch, N. M. Rothschild, heart of the firm’s power, continued to grow in strength, as was natural: London was the financial centre of the world, Rothschilds its most reliable pillar. Thus, in the sixteen years 1860-75, foreign governments raised over £700 million in London. Of the fifty banks involved, ten were Jewish, including such important names as Hambro, Samuel Montagu and Helbert Wagg.20 Rothschilds, however, played the biggest and most varied role of all fifty.
Inevitably, such financial pull brought political influence as well. It was the young Disraeli who first argued that Jews and Tories were natural allies, pointing out that the critical City of London elections of June 1841 and October 1843 had both been decided by Jewish votes: in the second, he noted, the Rothschilds brought out the Jews to win the seat for the anti-Corn Law Liberal even on a Saturday!21 Lionel, as head of the family, won the City seat himself in 1847 (though he could not take his place in parliament until disabilities were finally removed in 1858), and the Tory leader, Lord George Bentinck, pointed out in a letter to J. W. Croker the significance of the vote: ‘The City of London having elected Lionel Rothschild one of her representatives, it is such a pronunciation of public opinion that I do not think the party, as a party, would do themselves any good by taking up the question against the Jews. It is like [County] Clare electing O’Connell, or Yorkshire Wilberforce. Clare settled the Catholic question, Yorkshire the slave trade and now the City of London has settled the Jew question.’22
But the Rothschilds wisely did not try to force this issue, or any other. They knew time was on their side and were prepared to wait for it. They hated to make undue use of their financial power or to be seen exercising it at any time. Collectively, the Rothschilds always favoured peace, as one would expect; individually, the branches tended to back the policy aims of their respective countries, as one would also expect.23 In Britain, where they had most power if they chose to exercise it, a recent sifting of the evidence shows they rarely if ever took the initiative in pushing government.24 In moments of doubt over foreign affairs, it was their custom to ask government what ministers wanted them to do, as for instance during the 1884 Egyptian crisis.
They took, in fact, a very English line of deprecating money as such—they always referred to it as ‘tin’—and using it, rather, to build up a social position. They created two palatial ghettos, one urban, the other rural. The urban one was at the bottom corner of Piccadilly, where it joins Park Lane. Old Nathan began the process in 1825, when he stopped living ‘over the shop’ in 2 New Court, St Swithin’s Lane in the City, and bought 107 Piccadilly from Mrs Coutts, the banker’s widow. Other members of the family, English and Continental, followed him. His son Lionel built 148 Piccadilly, next to Apsley House, in the 1860s, providing it with the finest ballroom in London: the housewarming was combined with the marriage of his daughter Evelina to her cousin Ferdinand of Vienna; Disraeli proposed the toast to the bride’s health. Ferdinand himself bought 143 Piccadilly, and that too had a famous ballroom, all in white. Next door, at 142, was his sister Alice. At the back, Leopold de Rothschild bought 5 Hamilton Place. Round the corner, at 1 Seamore Place, was Alfred de Rothschild, the famous dandy. Hannah Rothschild, the heiress who married Lord Rosebery, took over the original 107.25
For a country house, old Nathan paid £20,000 for Gunnersbury, near Acton, in 1835. But that was a false start. The rural ghetto began when his widow bought a house near Mentmore in the Vale of Aylesbury, Buckinghamshire. Gradually they all settled in this part of Bucks, spreading into nearby Hertfordshire. Baron Mayer Rothschild built Mentmore Towers, modelled on Wollaton. Sir Anthony de Rothschild moved into Aston Clinton. In 1873 Lionel bought Tring, in Hertfordshire, for £250,000. He also had a 1,400-acre estate at Halton, later owned by Alfred de Rothschild. Then there was Leopold de Rothschild’s house Ascott, at Wing near Leighton Buzzard. In the 1870s Baron Ferdinand built Waddesdon, and he had other houses at Leighton Buzzard and Upper Winchendon. His sister Alice had Eythrop Priory. So the Vale of Aylesbury became Rothschild country. They owned 30,000 acres there and represented it in parliament from 1865 to 1923.
The rural headquarters was Tring, extended by Lionel’s son and heir Nathan to an estate of 15,000 acres. He became the 1st Lord Rothschild and Lord-Lieutenant of Buckinghamshire. In the true Jewish tradition, he turned Tring into a miniature welfare state. He supplied the locals with water and electricity, a fire service, a reading-room, allotments, a health service, even a cemetery for their dogs; for employees there were holiday camps, a pension scheme, apprenticeships, an unemployment plan, hampers and parties. The estate engaged in stock-breeding, sylviculture, sheep trials and conservation experiments.26
Lord Rothschild’s father, Lionel, had taken charge of many government loans, to finance Irish famine relief, fight the Crimean War, buy the khedive’s Suez Canal shares; he was very close to Disraeli, much closer than either found it convenient to admit, both in the City and in public life. He was felt to be disinterested because it was known he had forgone a £2 million profit rather than float a £100 million loan for the anti-Semitic Russian government.27 He was on excellent terms with Gladstone and his Foreign Secretary, Lord Granville. But he got on equally well with the Tories. He transformed Lord Randolph Churchill from a conventional slanger of Jewish ‘vested interests’ into a notable philosemite. He turned round A. J. Balfour too, making him into perhaps the most effective British friend the Jews ever had. He was the unofficial spokesman for the City from his father’s death in 1879 to his own in 1915. In her account of him, his great-niece Miriam Rothschild reflects that in world-wide terms he probably had a greater influence than any Jew since antiquity.28 ‘I should like to know’, asked Lloyd George rhetorically in his 1909 Limehouse speech, ‘is Lord Rothschild the dictator of this country?’ He was nothing of the sort: merely beneficently powerful. In 1915 on his death-bed in 148 Piccadilly, he was visited by Lord Haldane (temporarily in charge of the Foreign Office) who asked him to stop a neutral ship taking gold to Germany. He said: ‘That is a very simple matter,’ and scribbled an instruction on the back of an envelope.29
Rothschild was popular because his princely acts of charity were not just wise and systematic but eccentric. Children who waved to his carriage were liable to experience a shower of glittering half-sovereigns. His wife Emma denounced this as ‘insensitive and insulting’, but he replied that children took a different view and he was right—an old woman at Tring told Miriam Rothschild
she remembered such an incident for the rest of her life. The Rothschilds were generally liked in England not just because they ran highly successful racing stables but because ‘they never pulled their horses’. So ordinary folk did not mind if Lady Rothschild’s chef, Grosstephen Senior, probably the world’s best, ran a fishmonger’s bill alone of £5,000 a year. Rothschild gave the East End cabbies he used a brace of pheasants each at Christmas, and when he died the costermongers put black crêpe on their barrows. The Pall Mall Gazette wrote: ‘It is owing to the life of Lord Rothschild that Great Britain has escaped those collections of race feeling…with which so many other countries have been embarrassed during the last generation. He was at once a Prince in Israel and an Englishman of whom all England could be proud.’
