CHAPTER III — FIVE BROTHERS IN FIVE CAPITALS

(1815-25)

 

‘The Rothschilds really do constitute a special species plantarum …’ wrote Friedrich von Gentz, secretary to the great Austrian Chancellor, Prince Metternich, in 1818.

They are vulgar, ignorant Jews, outwardly presentable, in their trade the sheerest Emperialists, without the remotest inkling of any higher relationship. But they are endowed with a remarkable instinct which causes them always to choose the right, and of the two rights the better. Their enormous wealth (they are the richest in Europe) is entirely the result of this instinct, which the public are wont to call luck …[22]

Nevertheless the brothers still had to fight to consolidate their position in the post-war world. As banker-in-chief to the British Government, the brilliant thirty-eight-year-old Nathan of London, fountain-head of the family fortune, was the most firmly entrenched; next came twenty-three-year-old James of Paris who had the confidence of the newly enthroned French King. But the three Rothschilds in Frankfurt — Amschel, Salomon and Carl — enjoyed no comparable prestige because of the deeply engrained anti-Semitism of Central Europe.

As the three Rothschild banks constituted one firm, and the partners shared profits and losses, Nathan had determined that his brothers should acquire the same elevated position as himself. It was clear that their future lay in the great imperial city of Vienna; and the key to Vienna was held by Prince Metternich, the most influential statesman in Europe. Although Metternich was adventurous in the pursuit of women, when it came to politics he was deeply conservative. He believed that the upheaval provoked first by the French Revolution, then by Napoleonic conquest, had unbalanced the masses who needed the discipline of the old order. Equality, he insisted, was not what men wanted; fraternity was a sham; society must have its betters, otherwise its inferiors would spend their time cutting each other’s throats.

Alexander I of Russia played into Metternich’s hands by proposing a Holy Alliance that would guarantee the sovereignty of any monarch who adhered to Christian principles: and Metternich cleverly identified the Holy Alliance with maintenance of the status quo. At the Congress of Vienna he supported a new German confederation, with a diet at Frankfurt, composed of small autonomous states, so weak that they would be compelled to rely on Austria.

The Rothschild brothers followed Metternich’s moves with close attention and in 1815 Nathan advised Amschel and Salomon to ask Vienna for some form of ‘recognition’ for their ‘services’. He was referring, of course, to the British subsidies which he had paid to Austria through the Rothschild bank in Frankfurt. Amschel and Salomon had converted the pounds sterling into Austrian currency so quietly and quickly that they had managed to maintain the full value of the money, by preventing a fall in the exchange rate.

Nathan’s timing was faultless, for the Austrian Government was so much in need of loans that it had no wish to offend a powerful group of bankers. Consequently the Minister of Finance, Count Stadion, sent Salomon’s letter to the Emperor recommending that ‘Your Majesty will graciously confer on the two brothers of this firm, resident here, the German hereditary title of nobility …’ All that Stadion was requesting was a simple ‘von’ as a prefix; but Privy Councillor Baron von Lederer was indignant that such an honour be granted to a firm doing business in its own interests. ‘Your Majesty should make a gift to each of the two brothers Rothschild of a gold snuff box bearing Your Majesty’s monogram in diamonds …’ Finally it was left to Prince Metternich to decide; and the Prince, prompted by his secretary and economic adviser, Freidrich von Gentz, a Jew himself, plumped for the ‘von’.

Subsequently the Frankfurt Rothschilds were asked to present an appropriate coat-of-arms. In preparing the design Salomon overlooked the fact that there was mention only of two brothers and asked that a separate patent of nobility should be prepared for each of the five brothers. When the design reached the College of Heralds it had the effect of high explosive. The aged aristocrats who dealt with title deeds could scarcely believe their eyes. Never had such a preposterous, presumptuous, aggressive, overbearing proposal been submitted in the long history of heraldry. In the first quarter was an eagle (reference: Imperial Austrian coat-of-arms); in the second quarter a leopard (reference: English royal coat-of-arms); in the third quarter a lion (reference: Hessian coat-of-arms); in the fourth quarter, an arm bearing five arrows (reference: unity of five brothers). In the centre, on one side, was a greyhound, symbol of loyalty; on the other a stork, symbol of piety. The crest was a coronet surmounted by the lion of Hesse. And all this for a mere ‘von’. Outraged, the College pointed out: They ask for a coronet, a centre shield supporters, the Leopard of England, and the Lion of Hesse. According to the rules of heraldry, the gentry are entitled only to a helmet; their suggestion is entirely inadmissible since otherwise there would be nothing to distinguish the higher ranks, as coronets, supporters, and centre shield are proper only to the nobility. Moreover, no government will grant the emblems of other governments as nobility is conferred for services to one’s prince and one’s countries; the lion is a symbol of courage only, which does not apply to the Petitioners.[23]

The design returned from the College of Heralds was stripped of all its splendour; no coronet, no lion, no stork, no greyhound. In two quarters an arm, not with five but four arrows; in the other two quarters a half eagle each, which somehow became united to form a full eagle on top. But the Rothschilds were in no position to demur; and this became their family coat-of-arms in March 1817.

*

If Metternich was the key to Central Europe, Friedrich von Gentz was the key to Metternich. This astonishing man, an Austrian Jew by birth, a one-time member of the Prussian civil service, knew how to twist the Prince, his master, round his little finger. Gentz had infinite charm. He loved fine clothes and balls and beautiful women. A clever talker, a facile propagandist, he was the original public relations man of the early nineteenth century. He could promote anybody and everybody; he could institute a trend, inaugurate a fashion, popularize an aphorism. Gentz had made his reputation as secretary to the Congress of Vienna, an appointment later cited by Disraeli as evidence of the lasting hold of the Jews on the fortunes of mankind.

Now Gentz was Metternich’s secretary and, more important still, his financial adviser. Although Gentz pretended to have a wide knowledge of money his chief interest in this commodity was the accumulation of it for himself. He had it widely known that he not only was willing to accept bribes but would be affronted if they were not forthcoming. In his diary he refers to them as ‘good news’ or ‘pleasant financial dealings’. The payments were essential to him as he wished to satisfy the exacting demands of his middle-aged mistress, Fanny Essler, the famous dancer.

The Rothschilds concentrated on Friedrich von Gentz. When he visited Frankfurt before and after the Congress of Aachen in 1818, he placed himself in daily communication with the family; and after a number of ‘pleasant dealings’ promised to use his influence with Metternich to alleviate the lot of the Frankfurt Jews who, since the fall of Napoleon, had been subject to many of the old forms of oppression.

But this was not all that the Rothschilds wanted from Metternich. The truth was that the brothers had been hurt and indignant to find themselves excluded from the great French loan of 1817, raised to enable France to indemnify the victorious allies. Rothschild money had been in pressing demand throughout the war; but now that peace had come, the old-established, orthodox bankers seemed to be elbowing the parvenus out of the way.

At least that is how the Rothschilds saw it. The idea of floating a loan of such vast proportions as 1,000,000,000 francs had originated with the famous French banker, Gabriel-Julien Ouvrard, who had financed Napoleon’s Hundred Days and then switched his allegiance to Louis XVIII.

Ouvrard invited Alexander Baring of London, and Baring’s brother-in-law, Labouchere, the head of Hope and Co. of Amsterdam, to join him in raising the money but under no circumstances would he allow his hated rival, the ebullient, aggressive and unforgivably successful James Rothschild, to participate. James protested angrily and Baring did his best to change Ouvrard’s mind but the latter remained adamant. He could afford to do so as the French Foreign Secretary, the Due de Richelieu, disliked the Rothschilds whom he referred to as ‘upstarts’ and ‘coin-changers’. Indeed, he infuriated the brothers by pronouncing that: ‘There are six great powers in Europe; England, France, Russia, Austria, Prussia and the Baring Brothers.’

The first instalment of the Ouvrard-Baring combine was put on the market early in 1817 and consisted of a 350,000,000 franc, five per cent loan offered at 53. The bankers were greatly relieved to find that within a few days it was subscribed in full. They did not realize, of course, that most of it had been scooped up by the Rothschilds who decided that as they were barred from participation they would have to make a profit in other ways.

By the time that the Aachen Congress took place in 1818 two instalments of the loan had been issued. Although the Great Powers had declared that they would keep their armies in France until every penny of the indemnity had been paid, the financial burden of the occupation was proving far heavier than they had imagined. They finally decided that it would be better to accept a cut-price settlement of 24,000,000 francs (£1,000,000) and to withdraw the troops than to insist on the full amount which might require months of negotiation and result in spiralling costs.

Salomon and Carl Rothschild were present at the Congress and once again tried to participate in the third instalment of the loan. But the distinguished company scarcely seemed to notice them. Lady Castlereagh gave parties of unbelievable boredom; Metternich and Gentz flirted with the prettiest diplomatic wives; the Due de Richelieu cantered in the Park; Nesselrode played cards; and Carl Rothschild paraded his bride, the beautiful Adelaide Herz, a member of Germany’s most illustrious Jewish family, around the great conference hall but no one turned to look. Salomon meanwhile paced up and down his hotel bedroom wondering what he could do to stamp the Rothschild presence on the blasé assembly. The Civil Service was unsympathetic, merely pointing out that as Ouvrard and Baring and Hope had succeeded with their instalments of the year before there was no point in making a change; indeed, were not the bonds rising on the Paris Bourse at this very moment?

Throughout October the Rothschild brothers were neglected. But on 5 November something startling began to happen. The French rentes, the loan of 1817, were slipping. They fell from 74 to 73 and then to 71; from 71 to 69 and finally to 68. A near panic set in, for almost every diplomat present had speculated in the shares — on margin.

Friedrich von Gentz caught the glimmer of a smile on Salomon Rothschild’s face, and suddenly realized what was happening. The Rothschilds controlled the great French loan, and as a warning they had beared the market. Ouvrard called a hurried meeting with his fellow bankers. As they had promised to float the new instalment at 70 and could not go back on their word, they would be forced to issue the shares at an enormous loss, for the market had slipped to 65. However, Alexander Baring had an inspired solution. At a second meeting, attended by Prince Metternich of Austria, Prince Hardenberg of Germany and the Due de Richelieu of France, he told the company that he was prepared to carry out his pledges; but that dealings on margin by private individuals were permissible only on a rising market. The investors, therefore, would have to pay up fully. The statesmen looked askance for none of them had the necessary cash. Prince Metternich spluttered indignantly but finally saved the situation by suggesting that the old arrangement be declared null and void and a new agreement be drawn up, favourable to bankers and investors alike. And Baring and Hope and Ouvrard gave a sigh of relief.

However, when the third instalment was issued no one made the mistake of excluding the Rothschilds. Not only had the brothers reaped high profits by buying up the 1817 loan as members of the general public, but they had forced the Concert of Europe to recognize their financial supremacy. Ouvrard could rage, Hope could enveigh, Baring could protest; but the Rothschilds had arrived. ‘Fortresses so long besieged that they had almost appeared impregnable suddenly surrendered without resistance, with hardly a blow, unconditionally. The whole battered front gave way, wilted and collapsed. The conquering five, with flags flying and drums rolling — the strangest host in all history — marched on to victory …’[24] And of the five, the leader was Nathan Mayer Rothschild.

Spendthrift, Regency England served as a background for many bizarre figures, but none stranger than the post-war Croesus. Short and stocky, with a huge girth and an india-rubber face fringed by red hair out of which stared bulging blue eyes, he looked like a circus clown and was not much better educated. Although he had become a British subject he still had not mastered the language and spoke a queer mixture of English broken by Yiddish slang. However, when occasion demanded, he could swear like a trooper. Nathan was not a generous man and resented the advances made towards him by charitable organizations in search of funds. On the rare instances when he was over-persuaded to subscribe, he invariably regretted it. He would storm about the office like an excited schoolboy. ‘You make out the cheque,’ he would shout to one of his clerks. ‘I have made a f … fool of myself.’[25]

Nathan spent half his day as a banker and the other half speculating in stocks and bonds. He always stood under the same pillar on the floor of the Royal Exchange, well aware that he was a centre of attraction. Other brokers watched every gesture, hoping for a clue that would lead them to a hidden store of treasure. But Nathan’s joy was to tease and trick his competitors, so he often assumed an utterly blank expression.

Eyes are usually called the windows of the soul. But in Rothschild’s case you would conclude that the windows are false ones, or that there was no soul to look out of them. There comes not one pencil of light from the interior, neither is there any gleam of that which comes from without reflected in any direction. The whole puts you in mind of an empty skin, and you wonder why it stands upright, without at least something in it. By and by another figure comes up to it. It then steps two paces aside, and the most inquisitive glance that you ever saw, and a glance more inquisitive than you would have thought of, is drawn out of the fixed and leaden eyes, as if one were drawing a sword from a scabbard …[26]

The only person that Nathan trusted unreservedly was his good-looking wife, Hannah. This lady bore him four sons and three daughters, the last of whom was born in 1820. They lived modestly and, as the family grew, uncomfortably, in St Swithin’s Lane in the City where Nathan had moved in 1810. Their house was known as New Court because it had been rebuilt after the Great Fire of 1666. The ground floor housed the bank, the upper storeys the family. The house had a ‘cantilever cornice, a covered colonnade on the south side with steps up to the front door, a brick parapet, cock-loft, garrets and flats; within there were marble chimney pieces, kitchen, scullery, warehouse and counting-houses’.[27] Nathan’s rent was £175 a year.

The Rothschilds’ social life revolved around Hannah’s many brothers and sisters, the Cohens, who by their marriages had welded together the most prominent Jewish families in England. One of her sisters had become the wife of Moses Montefiore, merchant and broker, another sister the wife of Moses’ brother; a sister and brother had married a brother and sister of Moses Samuel, banker and broker; another brother a niece of Abraham Goldsmith. 

The Cohens were devout Jews, and Judith Cohen tells how Admiral Sir Sidney Smith called unexpectedly and was surprised to find the family seated in chairs that scarcely cleared the ground. When he asked ‘the reason for our being seated so low I replied “this is the anniversary of the destruction of Jerusalem which is kept by conforming Jews as a day of mourning and humiliation …”’[28] In order to please her orthodox family, Hannah managed to persuade Nathan to serve with Salomon Cohen as Warden of the Great Synagogue. Although Nathan refused to donate any money he managed to bring the three Ashkenaz synagogues in the City together and co-ordinated their work for the relief of the poor.

While Nathan did not seek the company of those outside his family, many distinguished people sought his. The Duke of Wellington was a frequent visitor; and so was Prince Talleyrand, France’s ambassador to the Court of St James, who delighted Hannah with his courtly manners, and amused the children with the statuary he fashioned from bread lumps. Another diplomatic friend was the Prussian ambassador. Count Wilhem von Humboldt. ‘Yesterday Rothschild dined with me,’ the latter wrote to his brother, Alexander, the famous naturalist. ‘He is quite crude and uneducated but he has a great deal of natural intelligence. He scored beautifully off Major Martins, who was being furiously sentimental about the horrors of war and the large number who had been killed. “Well,” said Rothschild, “if they had not all died, Major, you presumably would still be a drummer.”’[29]

Gradually Nathan acquired a reputation for bluntness that even the Iron Duke could not surpass. Once a lady was rash enough to express the hope that Nathan’s children were not fond of money and business to the exclusion of more important things. ‘I am sure you would not wish that,’ she said. ‘I am sure I should wish that,’ he retorted hotly. ‘I wish them to give mind, soul, heart and body — everything to business … It requires a great deal of boldness and a great deal of caution to make a large fortune and, when you have got it, you require ten times as much wit to keep it.’[30]

Once when a foreign prince called on Nathan in his office he not only found him blunt but rude. After curtly offering his visitor a seat, the banker turned his attention back on his private papers. The caller was offended. ‘Did you hear, sir, who I am?’ asked the prince, slapping his card on Nathan’s desk. The banker gazed at it a moment. ‘Take two chairs then.’ 

It was a very different thing when Nathan himself was slighted. Apparently the Bank of England once annoyed him by refusing to discount a bill drawn upon him by his brother Amschel of Frankfurt. One of the directors informed the Rothschild messenger that they ‘discounted only their own bills, and not those of private persons.’ ‘Private persons!’ exclaimed Nathan when the fact was reported to him. ‘I will make those gentlemen feel what sort of private persons we are!’

A few days later Nathan walked over to the bank, drew a £5 note out of his satchel and asked for gold. The clerk counted out five sovereigns, looking at the great Rothschild in astonishment. Nathan put the money in his briefcase and drew out a second note; then a third, and a fourth, and a fifth. It took him seven hours to change £21,000; but as he had nine clerks doing the same thing, by the end of the day the Bank had lost £210,000 from its gold reserves. The next day Nathan and his small battalion reappeared. ‘These gentlemen refuse to take my bills, so I will not keep theirs,’ he explained to the restless customers who could not find any tellers free to help them. ‘And I hold notes enough to keep them occupied for two months.’ Two months! Eleven million pounds of gold! The directors held a hurried meeting and agreed to send Nathan an abject apology. In future Rothschild bills would be accepted by the Bank of England as readily as their own.[31]

Nathan’s power not only sprang from his riches but his immense vitality. As early as 1817 the Prussian ambassador was reporting to Berlin that Rothschild was ‘easily the most enterprising business man in the country. He is, moreover, a man upon whom one can rely and with whom the Government here does considerable business. He is also … honest and intelligent.’[32] The director of the Prussian Treasury who was visiting London confirmed this opinion, adding that Rothschild had ‘an incredible influence upon all financial affairs here in London. It is widely stated … that he entirely regulates the rate of exchange in the City. His power as a banker is enormous.’[33]

As a result of these assessments Nathan was asked to raise a loan for the Prussian Government of £5,000,000 — the first state loan entrusted to him. He secured it at an average price of 72, a ‘splendid piece of business’, as the stock rose to 100. A succession of loans followed; £12,000,000 at three per cent for the British Government in 1819; £2,000,000 in 1821 and £2,500,000 in 1822 for the Neapolitan Government; £3,500,000 for Russia in 1822; £1,500,000 for Portugal in 1823; £3,500,000 for Austria in 1824.[34] Nathan’s banking methods made history, for he persuaded the English public to subscribe to foreign loans by the novel practice of arranging that the dividends should be paid in pounds sterling.

In 1824 a frenzy of speculation built up in England, reminiscent of the South Sea Bubble of the century before. With Latin America shaking off the authority of Spain, promoters stressed the rich rewards of investing in the nearly independent states and the public rushed to buy. Although almost every bank in the City floated the issues, Nathan Rothschild was too involved that year with the formation of the Alliance Insurance Company to take much part. He launched the new firm in conjunction with his brother-in-law, Moses Montefiore, at the instigation of another brother-in-law, Benjamin Gompertz.

Although Gompertz was a Fellow of the Royal Society, he could not get a job as an insurance actuary because of the prevailing notion that arson had a peculiar charm for the Hebrew; and this inspired Nathan with the idea of forming his own company. The Alliance was a success from the outset and before long was’ the largest insurance firm in Britain. Needless to say, Gompertz was the actuary.

Nathan was fortunate to have been so preoccupied for by the end of 1825 over three thousand firms had declared bankruptcy. There were rumours that even the Bank of England might have to shut its doors but Nathan and James stepped into the breach and arranged an emergency transfer of gold from France.

*

Meanwhile Nathan had been directing the fortunes of his brother, James, in Paris and his three brothers, Amschel, Salomon and Carl, who, when the Napoleonic wars came to an end, began to work together once more in the Frankfurt bank. Nathan argued in favour of one of them moving to Vienna. After all, Prince Metternich not only directed the Habsburg Empire which controlled Central Europe, but had imposed his creed of absolutism on a great portion of western Europe. None of the three brothers, however, was eager to leave home for snobbish, anti-Semitic, protocol-ridden Vienna.

The fact that a Rothschild finally settled in the Danubian capital happened by chance. In the summer of 1819 crowds marched through Frankfurt shouting against the Jews with the age-old cry, ‘Hepp! Hepp!’ They chalked slogans on all the houses and broke the windows of the Rothschild bank. The trouble had arisen because many of the German states, after ridding themselves of Napoleon’s overlordship, were appalled to find themselves once again under the yoke of Austria. A wave of nationalism swept through the German Confederation, whose headquarters were in Frankfurt. Bankers were regarded as the enemy as they supported Metternich’s reactionary ideas; and as most bankers were Jewish the protests threatened to turn into pogroms.

Jewish families felt that the city was on the verge of a massacre and hid trembling in their cellars. James Rothschild wrote from Paris to his eldest brother, Amschel, urging him to shut the bank and to move to France. The Austrian minister in Frankfurt, Herr Handel, heard the rumour and wrote post-haste to Prince Metternich. ‘The great and rich House of Rothschild is supposed to be not entirely adverse to the idea of leaving here … The question suggests itself whether it would not be to our interest … to induce the House to emigrate to Vienna.’[35]

Prince Metternich was deeply annoyed by the demonstrations, as he felt that they were a slap at his policy; ‘revolutionary anti-Semitics’, he called them. As a way of showing disapproval he gave Nathan Rothschild the position of Austrian consul in London and informed the Austrian Legation in Frankfurt that if the Rothschilds decided to leave their native city they would be welcome in Vienna. (James became Austrian consul-general in Paris a year later, in 1822). Then he asked Salomon Rothschild to draw up a plan by which 55,000,000 gulden — about £5,000,000 — could be raised for the Austrian State.

Once again Nathan master-minded the move, and Salomon produced the unusual suggestion of a lottery designed to attract the general public. Metternich gave the proposal his blessing and Salomon carried the idea through with true Rothschild finesse. The first issue consisted of 20,000,000 gulden and people hurried to subscribe under the impression that it represented the total sum. In the scramble the price was forced up; then came the second instalment of 35,000,000 gulden. By this time investors felt that they were on to a sure thing, and needed no persuasion to buy. But as they did so, the first issue declined alarmingly because of profit-taking by the sophisticated few.

This was bad enough, but when the terms of the loan were published the affair degenerated into a scandal. Salomon was to be repaid 114,000,000 gulden in return for the 55,000,000 gulden he had advanced. ‘A shameful Jewish ramp …’; ‘a moment of frivolity’; ‘an immoral transaction’, cried the press. ‘The loan is one of the most wicked things that have been done at the expense of our pockets and that is saying a good deal,’ declared an outraged speculator. Many people whispered that the Minister of Finance, Count Stadion, had been bribed along with dozens of minor officials. There was little doubt that Gentz had received ‘delightful news’ on a really epoch-making scale; but Prince Metternich had a reputation for honesty and as he had approved the terms he stood firmly at Salomon’s side. Fortunately, the first lottery issue recovered and the bonds of both instalments rose to new heights which quickly dispersed the ill-feeling.

The lottery took so much of Salomon’s time that he settled in Vienna and opened a branch of the Rothschild bank. Although he enjoyed Metternich’s favour, the position of Jews was far from enviable in the Habsburg Empire. They could not own land, nor become judges, civil servants, lawyers, teachers or army officers. They could not marry unless they paid a poll tax, and were forced to report regularly to the ‘Jewish Office’. Although ‘foreign Jews’ were given permits for limited periods only, an exception was made in the case of Salomon.

Nevertheless the law refusing Jews permission to buy houses was not relaxed, and Salomon took his revenge by booking every room in the Hotel Römischer Kaiser, the most luxurious hotel in the capital. He not only infuriated the King of Wurttemberg, a frequent visitor, who now was refused admittance, but annoyed the great composer, Beethoven, who would no longer give his recitals in the hotel’s splendid concert hall. Salomon was quite unmoved by the complaints, and lived in great luxury with his wife, Caroline Stern, the daughter of a rich Frankfurt merchant, and his two children, Amschel and Betty.

Salomon had the same corpulent body, the same round face and reddish hair as his brothers. Yet of the five sons he was the most likeable. He had none of Nathan’s rudeness or James’ moodiness; he was, in fact, generous, smiling and amiable; and within a few years the Frankfurt banker, Moritz Bethmann, was writing from Vienna: ‘Salomon has won the affections of the people here, partly through his general modesty and partly through his readiness to be obliging.’

Prince Metternich was also obliging. As Austria was chronically in debt and as Salomon’s lottery loan had proved to be a huge success, Secretary Gentz urged the Chancellor to make a really spectacular gesture towards the House of Rothschild, something that would keep the indispensable bankers firmly in tow for years to come. Accordingly, in 1822, Metternich asked the Emperor to confer baronies on the five brothers. The Habsburg College of Heralds had no option now but to restore the eagles and crests and lions rampant. And this time the hand clutched not four but five arrows.

Nathan however put the imperial communication announcing the honour into a desk drawer and forgot about it. He rightly sensed that the British would not be impressed by a German Jew who had taken the trouble to become a naturalized Englishman yet insisted on sporting a foreign title. He thanked Metternich profusely but remained plain Mr Rothschild.

Salomon, on the other hand, not only emerged in full baronial splendour but soon was advising the daughter of the Emperor Francis, the Archduchess Marie Louise, on her private financial affairs. Marie Louise had been blatantly unfaithful to her fallen spouse, Napoleon Bonaparte. She made no attempt to visit him in exile; indeed, at the Congress of Vienna, Metternich, who had arranged her marriage with Napoleon, treated her as the helpless victim of despotism, and gave her as compensation the dukedoms of Parma, Piacenza and Guastalla.

The great Chancellor also provided the Archduchess with consolation in the form of a dashing young general, Count Albert von Neipperg, who had been wounded in the war and wore a black, eye-patch. Marie Louise produced two children, one in 1819. As Napoleon was still alive, in faraway St Helena, the birth of the little bastards was kept secret. However, when in 1821 he finally obliged her by dying, Marie Louise married her Count. The Austrian Emperor gave the children titles and a name that cleverly resembled that of their father: Neipperg came from Neu-berg, ‘new mountain’, so they were called the Counts of Montenuovo, the Italian equivalent.

Salomon was summoned to give the newly created Counts a fitting inheritance. He consulted Nathan and came up with an ingenious suggestion. Marie Louise was to declare that she had spent a large amount of her private fortune on the public buildings in Parma; then she could be reimbursed by the Parma Treasury. The money would be converted by the Rothschild bank into bonds, and sold to different people in different countries. Metternich extended to the Archduchess the guarantee ‘that Your Majesty cannot do better than act in accordance with Rothschild’s suggestion’. Apparently the Archduchess had the same idea for she put herself in Salomon’s hands, ensuring a handsome heritage for her children.

*

Meanwhile Carl’s turn had come as well. The second youngest of the five brothers, Carl was thirty-three in 1821. Three years earlier Friedrich von Gentz had described him as ‘wanting in intelligence’, as he was slow and ponderous and expressed himself falteringly. Because of his lack of confidence he had been employed for years as the family courier, making more journeys between Frankfurt and Cassel with messages for the Elector and Buderus than the rest of the brothers put together. Yet in 1821 Amschel and Salomon sent Carl to Naples to deal with a revolution and a military occupation, on the principle that even an ineffective Rothschild was better than no Rothschild at all.

The revolt that had broken out in Naples was an extension of the trouble that had started in Germany. The people demanded a constitution and seventy-year-old Ferdinand I, trembling with fear, at once collapsed and promised them everything they wanted. Ferdinand was the son of a Spanish king, from whom he had inherited the Kingdom of the Two Sicilies, and the husband of Maria Theresa’s daughter, Maria Carolina, who had befriended Nelson’s Lady Hamilton. Ferdinand’s son had married the sister of Francis n, the reigning Austro-Hungarian Emperor.

Despite the close relationship between Ferdinand and the Habsburg sovereign Metternich was furious that the aged King had knuckled under to the insurgents, for he regarded the mildest form of liberalism as the thin edge of the wedge. He called a conference at Lailbach in Austria, which was attended by Alexander of Russia and Frederick William of Prussia. ‘It is a matter of indifference,’ he told the Tsar, ‘whether the word be Buonaparte or the sovereignty of the people; they are both equally dangerous, and must therefore both be resisted. The Neapolitan revolt, and everything connected with it, must be completely stamped out, or else the Powers themselves will be destroyed.’[36]

Poor old Ferdinand of Naples was also summoned to the conference and immediately renounced all the pledges he had made to his people, agreeing that the only way to handle the situation was for Austrian troops to occupy his kingdom. But who would pay for the invasion? The Austrian Treasury was empty as usual. Prince Metternich invited Salomon Rothschild to Lailbach but the latter excused himself on the grounds that his lottery loans needed daily attention. Instead, he sent Carl who became known as ‘un petit frère Rothschild’. Carl arrived with a plan concocted by Nathan and James suggesting that a loan should be raised in Naples which would defray the cost of the occupying army. This happy suggestion delighted the Lailbach congress and set the Austrian army in motion.

Nevertheless when the troops crossed the Po nerves were tense in Vienna; and when news came that in the north a rising had broken out in Alessandria, and that Piedmont might follow, Count Stadion, the Austrian Minister of Finance, completely lost his head. ‘The situation is terrifying,’ he wrote to Metternich. ‘Never, not even in the darkest hours of the revolutionary wars, has an event produced such an effect on the Vienna Bourse than the news from Italy … The whole of the population is rushing to get rid of our public securities … Our credit is on the eve of vanishing completely … This is the first step of our destruction …’[37]

Even Metternich and Gentz were so upset that they could not eat their dinner; but the Prince recovered himself and insisted that ‘it was impossible for us to take any other action … I hope that one or two hard blows will decide the issue …’

His wishes were granted, for the Austrian army entered Naples on 24 March 1821, after a bloodless, thirteen-day march. Alessandria and Piedmont quietened down, and the eruption in Lombardy was forestalled. Carl von Rothschild accompanied King Ferdinand from Florence to Naples and breathed new spirit into him. The timid slow-witted Carl was blossoming into a man of decision. When an Italian money syndicate in Naples claimed that it could raise a loan far more effectively and cheaply than le petit frère Rothschild, Carl went to the Austrian general in command of the occupying army, and emerged as sole floater of the loan. The issue was a huge success. ‘… If only peace lasts for a little while,’ Carl wrote to Prince Metternich, ‘the loan will soon be fully subscribed, and it will not be necessary to ask for guarantees in respect of the balance, as in that case all State securities will rise in value, and the Neopolitans will follow suit …’[38]

Carl, flushed with triumph, found Naples a most congenial place; and Metternich, delighted by the success of ‘the newest Rothschild’ begged Salomon to urge him to remain. Adelheid, Carl’s beautiful wife, settled the question by finding a wonderful palace on the Vesuvian shore which she persuaded Carl to buy. Here the young couple lived with their two children, entertaining the most distinguished society of the day. Among their royal guests was Leopold of Saxe-Coburg, Queen Victoria’s favourite uncle, who later became King of the Belgians.

Soon the Rothschild bank opened by Carl was regarded as an Italian institution, for Rothschild money was flowing through all the states of Italy. It drained the marshes of Tuscany, fertilized the kingdom of Sardinia, and revitalized the Papal States. In 1832 when Carl visited the Vatican the Pope departed from custom and held out his hand ‘Rothschild has just kissed the Pope’s hand,’ reported a contemporary, ‘and at his departure expressed his satisfaction with the successor of St Peter in the most gracious terms, … Others must bend down to the Holy Father’s toe, but Rothschild is given a finger.’

Nathan watched the progress of his brothers in Central Europe with satisfaction. The chronic insolvency of Metternich’s Government coupled with the chronic greed of Metternich’s secretary — Gentz — enabled all three Rothschilds to dig themselves into entrenched positions by the early 1820s. Even the eldest brother, Amschel, who remained in Frankfurt and ran the patriarchal bank, benefited from the dazzling successes of Salomon and Carl. ‘Most Gracious Prince! Most Gracious Prince and Lord!’, he wrote to Prince Metternich, when the latter was passing through Frankfurt. ‘I hope your Highness will not consider it as a presumption if I make so bold as to ask Your Highness to do me the gracious favour of taking soup with me this noon. Such a favour would mark an epoch in my life: but I would not have ventured this bold request if my brother in Vienna had not assured me that Your Highness did not entirely refuse to grant me this gracious favour …’[39]

Although Frankfurt society was impressed when Prince Metternich, accompanied by his mistress, Princess Lieven, accepted Amschel’s invitation, the Rothschild influence already was considerable. ‘Since arriving here,’ wrote the Bremen Burgomaster in 1821, ‘I have found to my great astonishment that people like the Bethmanns, Gontards, Brentanos, eat and drink with prominent Jews, invite them to their houses and are invited back, and, when I expressed my surprise, I was told that, as no financial transaction of any importance could be carried through without the cooperation of these people, they had to be treated as friends and it was not desirable to fall out with them …’[40]

Amschel was the most religious of all the brothers and the only one of the five who was thin. He refused to touch anything but Kosher food and looked more like a rabbi than a banker.

A man of thoroughly Oriental physiognomy [wrote one of his friends], with old Hebrew ways and manners. His hat is pushed back on to his neck … his coat is open … From a kind of superstition he still keeps his office in the house; he feels that luck might desert him if he left the house. There he sits like a padishah among his clerks, on a raised platform, his secretaries at his feet and his clerks and agents bustling about … No one is ever allowed to speak privately to him about business; everything is discussed openly in his office, as in the old Chinese Courts …[41]

Yet Amschel proved himself a skilful banker, eventually becoming treasurer to the German Confederation at Frankfurt which, as Prussia became increasingly dominating, was tantamount to serving as Prussian Minister of Finance. Amschel’s bank on the Fahrgasse gave birth to railways, roads and factories. He was a compulsive worker and even had a desk in his bedroom.

Although he could have lived anywhere he liked, he refused to leave Frankfurt, feeling homesick away from the scenes of his childhood. Even the jack-booted young men who strode through the streets crying ‘Hepp! Hepp!’ failed to unnerve him. Once when an anti-Jewish crowd demonstrated outside his house he appeared on the balcony and said: ‘There are forty million Germans. I have about as many florins. I will start by throwing each of you one.5 He emptied a bag of silver and the youths laughed and cupped their hands, then turned and went home.

As the traditionalist of the family, it was fitting that Amschel should inherit his father’s obligations. He never allowed the bonds to loosen between himself and the family of Hesse-Cassel, nor with Buderus von Carlhausen, the Elector’s financial adviser who had directed so much business to the Rothschilds. Both of these men died within a few months of each other, Buderus in 1820, and the Elector William the following year. ‘I will not win this battle,’ the latter had observed with his usual correct appreciation of the situation.

Now Amschel maintained a link with William’s son and heir, William X, the only difference being that the money flowed the other way, as Amschel financed the Prince. Often as the eldest Rothschild strode through the streets of Frankfurt in his caftan, onlookers would see him disappearing into His Serene Highness’ courtyard, on his way to luncheon. ‘The Hesses’, a contemporary wrote in astonishment, ‘take their midday meal en famille with their business friend,’

Although Amschel had moved to a large house in the middle of Frankfurt, his widowed mother, Gutle, seventy-two in 1824, and increasingly superstitious, refused to leave the ghetto for fear of bringing her children bad luck. She still lived in the House of the Green Shield, and from all over Europe sons and grandchildren came regularly to pay their respects. Gutle was uneducated and her hands were rough; but she understood the role played by her sons. Once, when one of her neighbours was fearful that war might break out between two German states, Gutle replied firmly: ‘Nonsense. My boys won’t give them the money.’