The Jews and Modern Capitalism

Werner Sombart

Translated by M. Epstein

 http://www.jrbooksonline.com/

Contents

Translator’s Introductory Note

Part I: The Contribution of the Jews to Modern Economic Life

Chapter 1:   Introductory

Chapter 2:   The Shifting of the Centre of Economic Life since the Sixteenth Century

Chapter 3:   The Quickening of International Trade

Chapter 4:   The Foundation of Modern Colonies

Chapter 5:   The Foundation of the Modern State

Chapter 6:   The Predominance of Commerce in Economic Life

Chapter 7:   The Growth of a Capitalistic Point of View in Economic Life

Part II: The Aptitude of the Jews of Modern Capitalism

Chapter 8:   The Problem

Chapter 9:   What is a Capitalist Undertaker?

Chapter 10: The Objective Circumstances in the Jewish Aptitude for Modern Capitalism

Chapter 11: The Significance of the Jewish Religion in Economic Life

Chapter 12: Jewish Characteristics

Part III: The Origin of the Jewish Genius

Chapter 13: The Race Problem

Chapter 14: The Vicissitudes of the Jewish People

Notes and References

 

Translator’s Introductory Note

Werner Sombart is undoubtedly one of the most striking personalities in the Germany of to-day. Born in 1863, he has devoted himself to research in economics, and has contributed much that is valuable to economic thought. Though his work has not always been accepted without challenge, it has received universal recognition for its brilliance, and his reputation has drawn hosts of students to his lectures, both at Breslau, where he held the Chair of Economics at the University (1890–1906), and now in Berlin at the Handelshochschule, where he occupies a similar position.

But Sombart is an artist as well as a scholar; he combines reason with imagination in an eminent degree, and he has the gift, seldom enough associated with German professors, of writing in a lucid, flowing, almost eloquent style. That is one characteristic of all his books, which are worth noting. The rise and development of modern capitalism has been the theme that has attracted him most, and his masterly treatment of it may be found in his Der moderne Kapitalismus (2 vols., Leipzig, 1902). In 1896 he published Sozialismus und soziale Bewegung, which quickly went through numerous editions and may be described as one of the most widely read books in German-speaking countries.[1] Die deutsche Volkswirtschaft im 19ten Jahrhundert appeared in 1903, and Das Proletariat in 1906.

For some years past Sombart has been considering the revision of his magnum opus on modern capitalism, and in the course of his studies came across the problem, quite accidentally, as he himself tells us, of the relation between the Jews and modern capitalism. The topic fascinated him, and he set about inquiring what that relationship precisely was. The results of his labours were published in the book[2] of which this is an English edition. The English version is slightly shorter than the German original. The portions that have been left out (with the author’s concurrence) are not very long and relate to general technical questions, such as the modern race theory or the early history of credit instruments. Furthermore, everything found within square brackets has been added by the translator. My best thanks are due to my wife, who has been constantly helpful with suggestions and criticisms, and to my friend Leon Simon for the verse rendering on pp. 000–000.

M. E. London, April 21, 1913.

Part I — The Contribution of the Jews to Modern Economic Life

 Chapter 1: 
Introductory

Two possible methods may be used to discover to what extent any group of people participated in a particular form of economic organization. One is the statistical; the other may be termed the genetic.

By means of the first we endeavour to ascertain the actual number of persons taking part in some economic activity—say, those who establish trade with a particular country, or who found any given industry—and then we calculate what percentage is represented by the members of the group in which we happen to be interested. There is no doubt that the statistical method has many advantages. A pretty clear conception of the relative importance for any branch of commerce of, let us say, foreigners or Jews, is at once evolved if we are able to show by actual figures that 50 or 75 per cent of all the persons engaged in that branch belong to either the first or the second category named. More especially is this apparent when statistical information is forthcoming, not only as to the number of persons but also concerning other or more striking economic factors—e.g., the amount of paid-up capital, the quantity of the commodities produced, the size of the turnover, and so forth. It will be useful, therefore, to adopt the statistical method in questions such as the one we have set ourselves. But at the same time it will soon become evident that by its aid alone the complete solution cannot be found. In the first place, even the best statistics do not tell us everything; nay, often the most important aspect of what we are trying to discover is omitted. Statistics are silent as to the dynamic effects which strong individualities produce in economic, as indeed in all human life—effects which have consequences reaching far beyond the limits of their immediate surroundings. Their actual importance for the general tendency of any particular development is greater far than any set of figures can reveal. Therefore the statistical method must be supplemented by some other.

But more than this. The statistical method, owing to lack of information, cannot always be utilized. It is indeed a lucky accident that we possess figures recording the number of those engaged in any industry or trade, and showing their comparative relation to the rest of the population. But a statistical study of this kind, on a large scale, is really only a possibility for modern and future times. Even then the path of the investigator is beset by difficulties. Still, a careful examination of various sources, including the assessments made by Jewish communities on their members, may lead to fruitful results. I hope that this book will give an impetus to such studies, of which, at the present time, there is only one that is really useful—the enquiry of Sigmund Mayr, of Vienna.

When all is said, therefore, the other method (the genetic), to which I have already alluded, must be used to supplement the results of statistics. What is this method? We wish to discover to what extent a group of people (the Jews) influence or have influenced the form and development of modern economic life—to discover, that is, their qualitative or, as I have already called it, their dynamic importance. We can do this best of all by enquiring whether certain characteristics that mark our modern economic life were given their first form by Jews, i.e., either that some particular form of organization was first introduced by the Jews, or that some well-known business principles, now accepted on all hands as fundamental, are specific expressions of the Jewish spirit. This of necessity demands that the history of the factors in economic development should be traced to their earliest beginnings. In other words, we must study the childhood of the modern capitalistic system, or, at any rate, the age in which it received its modern form. But not the childhood only: its whole history must be considered. For throughout, down to these very days, new elements are constantly entering the fabric of capitalism and changes appear in its characteristics. Wherever such are noted our aim must be to discover to whose influence they are due. Often enough this will not be easy; sometimes it will even be impossible; and scientific imagination must come to the aid of the scholar.

Another point should not be overlooked. In many cases the people who are responsible for a fundamental idea or innovation in economic life are not always the inventors (using that word in its narrowest meaning). It has often been asserted that the Jews have no inventive powers; that not only technical but also economic discoveries were made by non-Jews alone, and that the Jews have always been able cleverly to utilize the ideas of others. I dissent from this general view in its entirety. We meet with Jewish inventors in the sphere of technical science, and certainly in that of economics, as I hope to show in this work. But even if the assertion which we have mentioned were true, it would prove nothing against the view that Jews have given certain aspects of economic life the specific features they bear. In the economic world it is not so much the inventors that matter as those who are able to apply the inventions: not those who conceive ideas (e.g., the hire-purchase system) as those who can utilize them in everyday life.

Before proceeding to the problem before us—the share of the Jews in the work of building up our modern capitalistic system—we must mention one other point of importance. In a specialized study of this kind Jewish influence may appear larger than it actually was. That is in the nature of our study, where the whole problem is looked at from only one point of view. If we were enquiring into the influence of mechanical inventions on modern economic life the same would apply: in a monograph that influence would tend to appear larger than it really was. I mention this point, obvious though it is, lest it be said that I have exaggerated the part played by the Jews. There were undoubtedly a thousand and one other causes that helped to make the economic system of our time what it is. Without the discovery of America and its silver treasures, without the mechanical inventions of technical science, without the ethnical peculiarities of modern European nations and their vicissitudes, capitalism would have been as impossible as without the Jews.

In the long story of capitalism, Jewish influence forms but one chapter. Its relative importance to the others I shall show in the new edition of my Modern Capitalism, which I hope to have ready before long.

This caveat will, I trust, help the general reader to a proper appreciation of the influence of Jews on modern economic life. But it must be taken in conjunction with another. If on the one hand we are to make some allowance, should our studies apparently tend to give Jews a preponderating weight in economic affairs, on the other hand, their contribution is very often even larger than we are led to believe. For our researches can deal only with one portion of the problem, seeing that all the material is not available. Who to-day knows anything definite about the individuals, or groups, who founded this or that industry, established this or that branch of commerce, first adopted this or that business principle? And even where we are able to name these pioneers with certainty, there comes the further question, were they Jews or not?

Jews—that is to say, members of the people who profess the Jewish faith. And I need hardly add that although in this definition I purposely leave out any reference to race characteristics, it yet includes those Jews who have withdrawn from their religious community, and even descendants of such, seeing that historically they remain Jews. This must be borne in mind, for when we are determining the influence of the Jew on modern economic life, again and again men appear on the scene as Christians, who in reality are Jews. They or their fathers were baptized, that is all. The assumption that many Jews in all ages changed their faith is not far fetched. We hear of cases from the earliest Middle Ages; in Italy, in the 7th and 8th centuries; at the same period in Spain and in the Merovingian kingdoms; and from that time to this we find them among all Christian nations. In the last third of the 19th century, indeed, wholesale baptisms constantly occurred. But we have reliable figures for the last two or three decades only, and I am therefore inclined to doubt the statement of Jacob Fromer that towards the end of the twenties in last century something like half the Jews of Berlin had gone over to Christianity.1 Equally improbable is the view of Dr. Wemer, Rabbi in Munich, who, in a paper which he recently read, stated that altogether 120,000 Jews have been baptized in Berlin. The most reliable figures we have are all against such a likelihood. According to these, it was in the nineties that apostasy on a large scale first showed itself, and even then the highest annual percentage never exceeded 1.28 (in 1905), while the average percentage per annum (since 1895) was 1. Nevertheless, the number of Jews in Berlin who from 1873 to 1906 went over to Christianity was not small; their total was 1869 precisely.2

The tendency to apostasy is stronger among Austrian Jews, especially among those of Vienna. At the present time, between five and six hundred Jews in that city renounce their faith every year, and from 1868 to 1903 there have been no less than 9085. The process grows apace; in the years 1868 to 1879 there was on an average one baptism annually for every 1200 Jews; in the period 1880 to 1889 it was one for 420–430 Jews; while between 1890 and 1903 it had reached one for every 260– 270.3

But the renegade Jews are not the only group whose influence on the economic development of our time it is difficult to estimate. There are others to which the same applies. I am not thinking of the Jewesses who married into Christian families, and who, though they thus ceased to be Jewish, at any rate in name, must nevertheless have retained their Jewish characteristics. The people I have in mind are the crypto-Jews, who played so important a part in history, and whom we encounter in every century. In some periods they formed a very large section of Jewry. But their non-Jewish pose was so admirably sustained that among their contemporaries they passed as Christians or Mohammedans. We are told, for example, of the Jews of the South of France in the 15th and 16th centuries, who came originally from Spain and Portugal (and the description applies to the Marannos everywhere): “They practised all the outward forms of Catholicism; their births, marriages and deaths were entered on the registers of the church, and they received the sacraments of baptism, marriage and extreme unction. Some even took orders and became priests.”4 No wonder then that they do not appear as Jews in the reports of commercial enterprises, industrial undertakings and so forth. Some historians even to-day speak in admiring phrase of the beneficial influence of Spanish or Portuguese “immigrants.” So skillfully did the crypto-Jews hide their racial origin that specialists in the field of Jewish history are still in doubt as to whether a certain family was Jewish or not.5 In those cases where they adopted Christian names, the uncertainty is even greater. There must have been a large number of Jews among the Protestant refugees in the 17th century. General reasons would warrant this assumption, but when we take into consideration the numerous Jewish names found among the Huguenots the probability is strong indeed.6

Finally, our enquiries will not be able to take any account of all those Jews who, prior to 1848, took an active part in the economic life of their time, but who were unknown to the authorities. The laws forbade Jews to exercise their callings. They were therefore compelled to do so, either under cover of some fictitious Christian person or under the protection of a “privileged” Jew, or they were forced to resort to some other trick in order to circumvent the law. Reliable authorities are of opinion that the number of Jews who in many a town lived secretly in this way must have been exceedingly large. In the forties of last century, for example, it is said that no less than 12,000 Jews, at a moderate estimate, were to be found in Vienna. The wholesale textile trade was at that time already in their hands, and entire districts in the centre of the city were full of Jewish shops. But the official list of traders of 1845 contained in an appendix the names of only sixty-three Jews, who were described as “tolerated Jewish traders,” and these were allowed to deal only in a limited number of articles.7

But enough. My point was to show that, for many and various reasons, the number of Jews of whom we hear is less than those who actually existed. The reader should therefore bear in mind that the contribution of the Jews to the fabric of modern economic life will, of necessity, appear smaller than it was in reality.

What that contribution was we shall now proceed to show.

Chapter 2: 
The Shifting of the Centre of Economic Life since the Sixteenth Century

One of the most important facts in the growth of modern economic life is the removal of the centre of economic activity from the nations of Southern Europe — the Italians, Spaniards and Portuguese, with whom must also be reckoned some South German lands — to those of the North-West — the Dutch, the French, the English and the North Germans. The epoch-making event in the process was Holland’s sudden rise to prosperity, and this was the impetus for the development of the economic possibilities of France and England. All through the 17th century the philosophic speculators and the practical politicians among the nations of North-Western Europe had but one aim: to imitate Holland in commerce, in industry, in shipping and in colonization.

The most ludicrous explanations of this well-known fact have been suggested by historians. It has been said, for example, that the cause which led to the economic decline of Spain and Portugal and of the Italian and South German city states was the discovery of America and of the new route to the East Indies; that the same cause lessened the volume of the commerce of the Levant, and therefore undermined the position of the Italian commercial cities which depended upon it. But this explanation is not in any way satisfactory. In the first place, Levantine commerce maintained its pre-eminence throughout the whole of the 17th and 18th centuries, and during this period the prosperity of the maritime cities in the South of France, as well as that of Hamburg, was very closely bound up with it. In the second place, a number of Italian towns, Venice among them, which in the 17th century lost all their importance, participated to a large extent in the trade of the Levant in the 16th century, and that despite the neglect of the trade route. It is a little difficult to understand why the nations which had played a leading part until the 15th century — the Italians, the Spaniards, the Portuguese — should have suffered in the least because of the new commercial relations with America and the East Indies, or why they should have been placed at any disadvantage by their geographical position as compared with that of the French, the English or the Dutch. As though the way from Genoa to America or the West Indies were not the same as from Amsterdam or London or Hamburg! As though the Spanish and Portuguese ports were not the nearest to the new lands — lands which had been discovered by Italians and Portuguese, and had been taken possession of by the Portuguese and the Spaniards!

Equally unconvincing is another reason which is often given. It is asserted that the countries of North-Western Europe were strong consolidated states, while Germany and Italy were disunited, and accordingly the former were able to take up a stronger position than the latter. Here, too, we ask in wonder whether the powerful Queen of the Adriatic was a weaker state in the 16th century than the Seven Provinces in the 17th? And did not the empire of Philip II excel all the kingdoms of his time in power and renown? Why was it, moreover, that, although Germany was in a state of political disruption, certain of its cities, like Hamburg or Frankfort-on-the-Main, reached a high degree of development in the 17th and 18th centuries, such as few French or English cities could rival?

This is not the place to go into the question in all its many-sidedness. A number of causes contributed to bring about the results we have mentioned. But from the point of view of our problem one possibility should not be passed over which, in my opinion, deserves most serious consideration, and which, so far as I know, has not yet been thought of. Cannot we bring into connexion the shifting of the economic centre from Southern to Northern Europe with the wanderings of the Jews? The mere suggestion at once throws a flood of light on the events of those days, hitherto shrouded in semi-darkness. It is indeed surprising that the parallelism has not before been observed between Jewish wanderings and settlement on the one hand, and the economic vicissitudes of the different peoples and states on the other. Israel passes over Europe like the sun: at its coming new life bursts forth; at its going all falls into decay. A short résumé of the changing fortunes of the Jewish people since the 15th century will lend support to this contention.

The first event to be recalled, an event of world-wide import, is the expulsion of the Jews from Spain (1492) and from Portugal (1495 and 1497). It should never be forgotten that on the day before Columbus set sail from Palos to discover America (August 3, 1492) 300,000 Jews are said to have emigrated from Spain to Navarre, France, Portugal and the East; nor that, in the years during which Vasco da Gama searched for and found the sea-passage to the East Indies, the Jews were driven from other parts of the Pyrenean Peninsula.1

It was by a remarkable stroke of fate that these two occurrences, equally portentous in their significance — the opening-up of new continents and the mightiest upheavals in the distribution of the Jewish people—should have coincided. But the expulsion of the Jews from the Pyrenean Peninsula did not altogether put an end to their history there. Numerous Jews remained behind as pseudo-Christians (Marannos), and it was only as the Inquisition, from the days of Philip II onwards, became more and more relentless that these Jews were forced to leave the land of their birth.2 During the centuries that followed, and especially towards the end of the 16th, the Spanish and Portuguese Jews settled in other countries. It was during this period that the doom of the economic prosperity of the Pyrenean Peninsula was sealed.

With the 15th century came the expulsion of the Jews from the German commercial cities — from Cologne (1424–5), from Augsburg (1439–40), from Strassburg (1438), from Erfurt (1458), from Nuremberg (1498–9), from Ulm (1499), and from Ratisbon (1519).

The same fate overtook them in the 16th century in a number of Italian cities. They were driven from Sicily (1492), from Naples (1540– 1), from Genoa and from Venice (1550). Here also economic decline and Jewish emigration coincided in point of time.

On the other hand, the rise to economic importance, in some cases quite unexpectedly, of the countries and towns whither the refugees fled, must be dated from the first appearance of the Spanish Jews. A good example is that of Leghorn,3 one of the few Italian cities which enjoyed economic prosperity in the 16th century. Now Leghorn was the goal of most of the exiles who made for Italy. In Germany it was Hamburg and Frankfort4 that admitted the Jewish settlers. And remarkable to relate, a keen-eyed traveller in the 18th century wandering all over Germany found everywhere that the old commercial cities of the Empire, Ulm, Nuremberg, Augsburg, Mayence and Cologne, had fallen into decay, and that the only two that were able to maintain their former splendour, and indeed to add to it from day to day, were Frankfort and Hamburg.5

In France in the 17th and 18th centuries the rising towns were Marseilles, Bordeaux, Rouen — again the havens of refuge of the Jewish exiles.6

As for Holland, it is well-known that at the end of the 16th century a sudden upward development (in the capitalistic sense) took place there. The first Portuguese Marannos settled in Amsterdam in 1593, and very soon their numbers increased. The first synagogue in Amsterdam was opened in 1598, and by about the middle of the 17th century there were Jewish communities in many Dutch cities. In Amsterdam, at the beginning of the 18th century, the estimated number of Jews was 2400.7 But even by the middle of the 17th century their intellectual influence was already marked; the writers on international law and the political philosophers speak of the ancient Hebrew commonwealth as an ideal which the Dutch constitution might well seek to emulate.8 The Jews themselves called Amsterdam at that time their grand New Jerusalem.9 Many of the Dutch settlers had come from the Spanish Netherlands, especially from Antwerp, whither they had fled on their expulsion from Spain. It is true that the proclamations of 1532 and 1539 forbade the pseudo-Christians to remain in Antwerp, but they proved ineffective. The prohibition was renewed in 1550, but this time it referred only to those who had not been domiciled for six years. But this too remained a dead letter: “the crypto-Jews are increasing from day to day.” They took an active part in the struggle for freedom in which the Netherlands were engaged, and its result forced them to wander to the more northerly provinces.10 Now it is a remarkable thing that the brief space during which Antwerp became the commercial centre and the money-market of the world should have been just that between the coming and the going of the Marannos.11

It was the same in England. The economic development of the country, in other words, the growth of capitalism,12 ran parallel with the influx of Jews, mostly of Spanish andPortuguese origin.13

It was believed that there were no Jews in England from the time of their expulsion under Edward I (1290) until their more or less officially recognized return under Cromwell (1654–56). The best authorities on Anglo-Jewish history are now agreed that this is a mistake. There were always Jews in England; but not till the 16th century did they begin to be numerous. Already in the reign of Elizabeth many were met with, and the Queen herself had a fondness for Hebrew studies and for intercourse with Jews. Her own physician was a Jew, Rodrigo Lopez, on whom Shakespeare modelled his Shylock. Later on, as is generally known, the Jews, as a result of the efforts of Manasseh ben Israel, obtained the right of unrestricted domicile. Their numbers were increased by further streams of immigrants including, after the 18th century, Jews from Germany, until, according to the author of the Anglia Judaica, there were 6000 Jews in London alone in the year 1738.14

When all is said, however, the fact that the migration of the Jews and the economic vicissitudes of peoples were coincident events does not necessarily prove that the arrival of Jews in any land was the only cause of its rise or their departure the only cause of its decline. To assert as much would be to argue on the fallacy “post hoc, ergo propter hoc.” Nor are the arguments of later historians on this subject conclusive, and therefore I will not mention any in support of my thesis.15 But the opinions of contemporaries always, as I think, deserve attention. So I will acquaint the reader with some of them, for very often a word suffices to throw a flood of light on their age.

When the Senate of Venice, in 1550, decided to expel the Marannos and to forbid commercial intercourse with them, the Christian merchants of the city declared that it wouldmean their ruin and that they might as well leave Venice with the exiles, seeing that they made their living by trading with the Jews. The Jews controlled the Spanish wool trade, the trade in Spanish silk and crimsons, sugar, pepper, Indian spices and pearls. A great part of the entire export trade was carried on by Jews, who supplied the Venetians with goods to be sold on commission; and they were also bill-brokers.16

In England the Jews found a protector in Cromwell, who was actuated solely by considerations of an economic nature. He believed that he would need the wealthy Jewish merchants to extend the financial and commercial prosperity of the country. Nor was he blind to the usefulness of having moneyed support for the government.17

Like Cromwell, Colbert, the great French statesman of the 17th century, was also sympathetically inclined towards the Jews, and in my opinion it is of no small significance that these two organizers, both of whom consolidated modern European states, should have been so keenly alive to the fitness of the Jew in aiding the economic (i.e., capitalistic) progress of a country. In one of his Ordinances to the Intendant of Languedoc, Colbert points out what great benefits the city of Marseilles derived from the commercial capabilities of the Jews.18 The inhabitants of the great French trading centres in which the Jews played an important role were in no need of being taught the lesson; they knew it from their own experience and, accordingly, they brought all their influence to bear on keeping their Jewish fellow-citizens within their walls. Again and again we hear laudatory accounts of the Jews, more especially from the inhabitants of Bordeaux. In 1675 an army of mercenaries ravaged Bordeaux, and many of the rich Jews prepared to depart. The Town Council was terrified, and the report presented by its members is worth quoting. “The Portuguese who occupy whole streets and do considerable business have asked for their passports. They and those aliens who do a very large trade are resolved to leave; indeed, the wealthiest among them, Gaspar Gonzales and Alvares, have already departed. We are very much afraid that commerce will cease altogether.”19 A few years later the Sous-Intendant of Languedoc summed up the situation in the words “without them (the Jews) the trade of Bordeaux and of the whole province would be inevitably ruined.”20

We have already seen how the fugitives from the Iberian Peninsula in the 16th century streamed into Antwerp, the commercial metropolis of the Spanish Netherlands. About the middle of the century, the Emperor in a decree dated July 17, 1549 withdrew the privileges which had been accorded them. Thereupon the mayor and sheriffs, as well as the Consul of the city, sent a petition to the Bishop of Arras in which they showed the obstacles in the way of carrying out the Imperial mandate. The Portuguese, they pointed out, were large undertakers; they had brought great wealth with them from the lands of their birth, and they maintained an extensive trade. “We must bear in mind,” they continued, “that Antwerp has grown great gradually, and that a long space of time was needed before it could obtain possession of its commerce. Now the ruin of the city would necessarily bring with it the ruin of the land, and all this must be carefully considered before the Jews are expelled.” Indeed, the mayor, Nicholas Van den Meeren, went even further in the matter. When Queen Mary of Hungary, the Regent of the Netherlands, was staying in Ruppelmonde, he paid her a visit in order to defend the cause of the New Christians, and excused the conduct of the rulers of Antwerp in not publishing the Imperial decree by informing her that it was contrary to all the best interests of the city.21 His efforts, however, were unsuccessful, and the Jews, as we have already seen, left Antwerp for Amsterdam.

Antwerp lost no small part of its former glory by reason of the departure of the Jews, and in the 17th century especially it was realized how much they contributed to bring about material prosperity. In 1653 a committee was appointed to consider the question whether the Jews should be allowed into Antwerp, and it expressed itself on the matter in the following terms: “And as for the inconveniences which are to be feared and apprehended in the public interest — that they (the Jews) will attract to themselves all trade, that they will be guilty of a thousand frauds and tricks, and that by their usury they will devour the wealth of good Catholics — it seems to us on the contrary that by the trade which they will expand far beyond its present limits the benefit derived will be for the good of the whole land, and gold and silver will be available in greater quantities for the needs of the state.”22

The Dutch in the 17th century required no such recommendations; they were fully alive to the gain which the Jews brought. When Manasseh ben Israel left Amsterdam on his famous mission to England, the Dutch Government became anxious; they feared lest it should be a question of transplanting the Dutch Jews to England, and they therefore instructed Neuport, their ambassador in London, to sound Manasseh as to his intentions. He reported (December 1655) that all was well, and that there was no cause for apprehension. “Manasseh ben Israel hath been to see me, and did assure me that he doth not desire anything for the Jews in Holland but only for those as sit in the Inquisition in Spain and Portugal.”23

It is the same tale in Hamburg. In the 17th century the importance of the Jews had grown to such an extent that they were regarded as indispensable to the growth of Hamburg’s prosperity. On one occasion the Senate asked that permission should be given for synagogues to be built, otherwise, they feared, the Jews would leave Hamburg, and the city might then be in danger of sinking to a mere village.24 On another occasion, in 1697, when it was suggested that the Jews should be expelled, the merchants earnestly entreated the Senate for help, in order to prevent the serious endangering of Hamburg’s commerce.25 Again, in 1733, in a special report, now in the Archives of the Senate, we may read: “In bill-broking, in trade with jewellery and braid and in the manufacture of certain cloths the Jews have almost a complete mastery, and have surpassed our own people. In the past there was no need to take cognizance of them, but now they are increasing in numbers. There is no section of the great merchant class, the manufacturers and those who supply commodities for daily needs, but the Jews form an important element therein. They have become a necessary evil.”26 To the callings enumerated in which the Jews took a prominent part, we must add that of marine insurance brokers.27

So much for the judgment of contemporaries. But as a complete proof even that will not serve. We must form our own judgment from the facts, and therefore our first aim must be to seek these out. That means that we must find from the original sources what contributions the Jews made to the building-up of our modern economic life from the end of the 15th century onward — the period, that is, when Jewish history and general European economic progress both tended in the same direction. We shall then also be able to state definitely to what extent the Jews influenced the shifting of the centre of economic life.

My own view is, as I may say in anticipation, that the importance of the Jews was twofold. On the one hand, they influenced the outward form of modern capitalism; on the other, they gave expression to its inward spirit. Under the first heading, the Jews contributed no small share in giving to economic relations the international aspect they bear to-day; in helping the modern state, that framework of capitalism, to become what it is; and lastly, in giving the capitalistic organization its peculiar features, by inventing a good many details of the commercial machinery which moves the business life of to-day, and co-operating in the perfecting of others. Under the second heading, the importance of the Jews is so enormous because they, above all others, endowed economic life with its modern spirit; they seized upon the essential idea of capitalism and carried it to its fullest development.

We shall consider these points in turn, in order to obtain a proper notion of the problem. Our intention is to do no more than ask a question or two, and here and there to suggest an answer. We want merely to set the reader thinking. It will be for later research to gather sufficient material by which to judge whether, and to what extent, the views as to cause and effect here propounded have any foundation in actual fact.

Chapter 3: 
The Quickening of International Trade

The transformation of European commerce which has taken place since the shifting of the centre of economic activity owed a tremendous debt to the Jews. If we consider nothing but the quantity of commodities that passed through their hands, their position is unique. Exact statistics are, as I have already remarked, almost non-existent; special research may, however, bring some figures to light that will be useful. At present there is, to my knowledge, only some slight material on this head, but its value cannot be overestimated.

It would appear that even before their formal admission into England—that is, in the first half of the 17th century—the extent of the trade in the hands of Jews totalled one-twelfth of that of the whole kingdom.1 Unfortunately we are not told on what authority this calculation rests, but that it cannot be far from the truth is apparent from a statement in a petition of the merchants of London. The question was whether Jews should pay the duty on imports levied on foreigners. The petitioners point out that if the Jews were exempted, the Crown would sustain a loss of ten thousand pounds annually.2

We are remarkably well informed as to the proportion of trading done by Jews at the Leipzig fairs,3 and as these were for a long period the centre of German commerce, we have here a standard by which to measure its intensive and extensive development. But not alone for Germany. One or two of the neighbouring countries, especially Bohemia and Poland, can also be included in the survey. From the end of the 17th century onwards we find that the Jews take an increasing share in the fairs, and all the authorities who have gone into the figures are agreed that it was the Jews who gave to the Leipzig fairs their great importance. 4

It is only since the Easter fair of 1756 that we are able to compare the Jewish with the Christian traders, as far as numbers are concerned, for it is only from that date that the Archives possess statistics of the latter. The average number of Jews attending the Leipzig fair was as follows:—

1675-1680                416 1681-1690                489 1691-1691                834 1701-1710                854 1711-1720                769 1721-1730                899 1731-1740                874 1741-1748                708

1767-1769                995 1770-1779              1652 1780-1789              1073 1790-1799              1473 1800-1809              3370 1810-1819              4896 1820-1829              3747 1830-1839              6444

 

Note especially the speedy increase towards the end of the 17th and 18th centuries and also at the beginning of the 19th.

If we glance at the period 1766 to 1839, we see that the fairs were visited annually by an average of 3185 Jews and 13,005 Christians—that is to say, the Jews form 24.49 per cent, or nearly one-quarter of the total number of Christian merchants. Indeed, in some years, as for example between 1810 and 1820, the Jewish visitors form 33% per cent of the total of their colleagues (4896 Jews and 14,366 Christians). This is significant enough, and there is no need to lay stress on the fact that in all probability the figures given in the table are underestimated.

The share taken by Jews in the commerce of a country may sometimes be ascertained by indirect means. We know, for example, that the trade of Hamburg with Spain and Portugal, and also with Holland, in the 17th century was almost entirely in the hands of the Jews.5 Now some 20 per cent. of the ships’ cargoes leaving Hamburg were destined for the Iberian Peninsula, and some 30 per cent for Holland.6

Take another instance. The Levant trade was the most important branch of French commerce in the 18th century. A contemporary authority informs us that it was entirely controlled by Jews—“buyers, sellers, middlemen, bill-brokers, agents and so forth were all Jews.”7

In the 16th and 17th centuries, and even far into the 18th, the trade of the Levant as well as that with, and via, Spain and Portugal, was the broadest stream in the world’s commerce. This mere generalization goes far to prove how preeminent, from the purely quantitative point of view, the Jews were in forwarding the development of international intercourse. Already in Spain the Jews had managed to obtain control of the greater portion of the Levant trade, and everywhere in the Levantine ports Jewish offices and warehouses were to be found. Many Spanish Jews at the time of the expulsion from Spain settled in the East; the others journeyed northwards. So it came about that almost imperceptibly the Levantine trade became associated with the more northerly peoples. In Holland, more especially, is the effect of this seen: Holland became a commercial country of world-wide influence. Altogether, the commercial net, so to say, became bigger and stronger in proportion as the Jews established their offices, on the one hand further afield, on the other in closer proximity to each other.8 More particularly was this the case when the Western Hemisphere—largely through Jewish influence—was drawn into the commerce of the world. We shall have more to say on this aspect of the question in connexion with the part the Jews played in colonial foundations.

Another means by which we may gain a clear conception of what the Jews did for the extension of modern commerce is to discover the kind of commodities in which they for the most part traded. The quality of the commerce matters more than its quantity. It was by the character of their trade that they partially revolutionized the older forms, and thus helped to make commerce what it is to-day.

Here we are met by a striking fact. The Jews for a long time practically monopolized the trade in articles of luxury, and to the fashionable world of the aristocratic 17th and 18th centuries this trade was of supreme moment. What sort of commodities, then, did the Jews specialize in? Jewellery, precious stones, pearls and silks.9 Gold and silver jewellery, because they had always been prominent in the market for precious metals. Pearls and stones, because they were among the first to settle in those lands (especially Brazil) where these are to be found; and silks, because of their ancient connexions with the trading centres of the Orient.

Moreover, Jews were to be found almost entirely, or at least predominantly, in such branches of trade as were concerned with exportation on a large scale. Nay, I believe it may with justice be asserted that the Jews were the first to place on the world’s markets the staple articles of modern commerce. Side by side with the products of the soil, such as wheat, wool, flax, and, later on, distilled spirits, they dealt throughout the 18th century specially in textiles,10 the output of a rapidly growing capitalistic industry, and in those colonial products which for the first time became articles of international trade, viz., sugar and tobacco. I have little doubt that when the history of commerce in modern times comes to be written Jewish traders will constantly be met with in connexion with enterprises on a large scale. The references which quite by accident have come under my notice are already sufficient to prove the truth of this assertion.11

Perhaps the most far-reaching, because the most revolutionary, influence of the Jews on the development of economic life was due to their trade in new commodities, in the preparation of which new methods supplanted the old. We may mention cotton,12 cotton goods of foreign make, indigo and so forth.13 Dealing in these articles was looked upon at the time as “spoiling sport,” and therefore Jews were taunted by one German writer with carrying on “unpatriotic trade”14 or “Jew-commerce, which gave little employment to German labour, and depended for the most part on home consumption only.”15

Another great characteristic of “Jew-commerce,” one which all later commerce took for its model, was its variety and many-sidedness. When in 1740 the merchants of Montpelier complained of the competition of the Jewish traders, the Intendant replied that if they, the Christians, had such well-assorted stocks as the Jews, customers would come to them as willingly as they went to their Jewish competitors.16 We hear the same of the Jews at the Leipzig fairs: “The Jewish traders had a beneficial influence on the trade of the fairs, in that their purchases were so varied. Thus it was the Jews who tended to make trade many-sided and forced industry (especially the home industries) to develop in more than one direction. Indeed, at many fairs the Jews became the arbiters of the market by reason of their extensive purchases.”17

But the greatest characteristic of “Jew-commerce” during the earlier capitalistic age was, to my mind, the supremacy which Jewish traders obtained, either directly or by way of Spain and Portugal, in the lands from which it was possible to draw large supplies of ready money. I am thinking of the newly discovered gold and silver countries in Central and South America. Again and again we find it recorded that Jews brought ready money into the country.18 The theoretical speculator and the practical politician knew well enough that here was the source of all capitalistic development. We too, now that the mists of Adam Smith’s doctrines have lifted, have realized the same thing. The establishment of modern economic life meant, for the most part, and of necessity, the obtaining of the precious metals, and in this work no one was so successfully engaged as the Jewish traders. This leads us at once to the subject of the next chapter, which deals with the share of the Jews in colonial expansion.

Chapter 4: 
The Foundation of Modern Colonies

We are only now beginning to realize that colonial expansion was no small force in the development of modern capitalism. It is the purpose of this chapter to show that in the work of that expansion the Jews played, if not the most decisive, at any rate a most prominent part.

That the Jews should have been keen colonial settlers was only natural, seeing that the New World, though it was but the Old in a new garb, seemed to hold out a greater promise of happiness to them than crossgrained old Europe, more especially when their last Dorado (Spain) proved an inhospitable refuge. And this applies equally to all colonial enterprises, whether in the East or the West or the South of the globe. There were probably many Jews resident in the East Indies even in mediaeval times,1 and when the nations of Europe, after 1498, stretched out their hands to seize the lands of an ancient civilization, the Jews were welcomed as bulwarks of European supremacy, though they came as pioneers of trade. In all likelihood—exact proofs have not yet been established—the ships of the Portuguese and of the Dutch must have brought shoals of Jewish settlers to their respective Indian possessions. At any rate, Jews participated extensively in all the Dutch settlements, including those in the East. We are told that Jews were large shareholders in the Dutch East India Company.2 We know that the Governor of the Company who, “if he did not actually establish the power of Holland in Java, certainly contributed most to strengthen it,”3 was called Cohn (Coen). Furthermore, a glance at the portraits of the Governors of the Dutch colonies would make it appear that this Coen is not the only Jew among them.4 Jews were also Directors of the Company;5 in short, no colonial enterprise was complete without them.6

It is as yet unknown to what extent the Jews shared in the growth of economic life in India after the English became masters there. We have, however, fairly full information as to the participation of the Jews in the founding of the English colonies in South Africa and Australia. There is no doubt that in these regions (more particularly in Cape Colony), wellnigh all economic development was due to the Jews. In the twenties and thirties of the 19th century Benjamin Norden and Simon Marks came to South Africa, and “the industrial awakening of almost the whole interior of Cape Colony” was their work. Julius Mosenthal and his brothers Adolph and James established the trade in wool, skins, and mohair. Aaron and Daniel de Pass monopolized the whaling industry; Joel Myers commenced ostrich fanning. Lilienfeld, of Hopetown, bought the first diamonds. 7 Similar leading positions were occupied by the Jews in the other South African colonies, particularly in the Transvaal, where it is said that to-day twenty-five of the fifty thousand Jews of South Africa are settled.8 It is the same story in Australia, where the first wholesale trader was Montefiore. It would seem to be no exaggeration therefore that “a large proportion of the English colonial shipping trade was for a considerable time in the hands of the Jews.”9

But the real sphere of Jewish influence in colonial settlements, especially in the early capitalistic period, was in the Western Hemisphere. America in all its borders is a land of Jews. That is the result to which a study of the sources must inevitably lead, and it is pregnant with meaning. From the first day of its discovery America has had a strong influence on the economic life of Europe and on the whole of its civilization; and therefore the part which the Jews have played in building up the American world is of supreme import as an element in modern development. That is why I shall dwell on this theme a little more fully, even at the risk of wearying the reader.10

The very discovery of America is most intimately bound up with the Jews in an extraordinary fashion. It is as though the New World came into the horizon by their aid and for them alone, as though Columbus and the rest were but managing directors for Israel. It is in this light that Jews, proud of their past, now regard the story of that discovery, as set forth in the latest researches.11 These would seem to show that it was the scientific knowledge of Jewish scholars which so perfected the art of navigation that voyages across the ocean became at all possible. Abraham Zacuto, Professor of Mathematics and Astronomy at the University of Salamanca, completed his astronomical tables and diagrams, the Almanach perpetuum, in 1473. On the basis of these tables two other Jews, Jose Vecuho, who was Court astronomer and physician to John II of Portugal, and one Moses the Mathematician (in collaboration with two Christian scholars), discovered the nautical astrolabe, an instrument by which it became possible to measure from the altitude of the sun the distance of a ship from the Equator. Jose further translated the Almanack of his master into Latin and Spanish.

The scientific facts which prepared the way for the voyage of Columbus were thus supplied by Jews. The money which was equally necessary came from the same quarter, at any rate as regards his first two voyages. For the first voyage, Columbus obtained a loan from Louis de Santangel, who was of the King’s Council; and it was to Santangel, the patron of the expedition, and to Gabriel Saniheg, a Maranno, the Treasurer of Aragon, that the first two letters of Columbus were addressed. The second voyage was also undertaken with the aid of Jewish money, this time certainly not voluntarily contributed. On their expulsion from Spain in 1492, the Jews were compelled to leave much treasure behind; this was seized by Ferdinand for the State Exchequer, and with a portion of it Columbus was financed.

But more than that. A number of Jews were among the companions of Columbus, and the first European to set foot on American soil was a Jew—Louis de Torres. So the latest researches would have us believe. 12

But what caps all—Columbus himself is claimed to have been a Jew. I give this piece of information for what it is worth, without guaranteeing its accuracy. At a meeting of the Geographical Society of Madrid, Don Celso Garcia de la Riega, a scholar famous for his researches on Columbus, read a paper in which he stated that Christobal Colon (not Columbus) was a Spaniard who on his mother’s side was of Jewish descent. He showed by reference to documents in the town of Pontevedra, in the province of Galicia, that the family of Colon lived there between 1428 and 1528, and that the Christian names found among them were the same as those prevalent among the relatives of the Spanish admiral. These Colons and the Fonterosa family intermarried. The latter were undoubtedly Jews, or they had only recently been converted, and Christobal’s mother was called Suzanna Fonterosa. When disorders broke out in the province of Galicia the parents of the discoverer of America migrated from Spain to Italy. These facts were substantiated by Don Celso from additional sources, and he is strengthened in his belief by distinct echoes of Hebrew literature found in the writings of Columbus, and also because the oldest portraits show him to have had a Jewish face.

Scarcely were the doors of the New World opened to Europeans than crowds of Jews came swarming in. We have already seen that the discovery of America took place in the year in which the Jews of Spain became homeless, that the last years of the 15th century and the early years of the 16th were a period in which millions of Jews were forced to become wanderers, when European Jewry was like an antheap into which a stick had been thrust. Little wonder, therefore, that a great part of this heap betook itself to the New World, where the future seemed so bright. The first traders in America were Jews. The first industrial establishments in America were those of Jews. Already in the year 1492 Portuguese Jews settled in St. Thomas, where they were the first plantation owners on a large scale; they set up many sugar factories and gave employment to nearly three thousand Negroes.13 And as for Jewish emigration to South America, almost as soon as it was discovered, the stream was so great that Queen Joan in 1511 thought it necessary to take measures to stem it.14 But her efforts must have been without avail, for the number of Jews increased, and finally, on May 21, 1577, the law forbidding Jews to emigrate to the Spanish colonies was formally repealed.

In order to do full justice to the unceasing activity of the Jews in South America as founders of colonial commerce and industry, it will be advisable to glance at the fortunes of one or two colonies.

The history of the Jews in the American colonies, and therefore the history of the colonies themselves, falls into two periods, separated by the expulsion of the Jews from Brazil in 1654.

We have already mentioned the establishment of the sugar industry in St. Thomas by Jews in 1492. By the year 1550 this industry had reached the height of its development on the island. There were sixty plantations with sugar mills and refineries, producing annually, as may be seen from the tenth part paid to the King, 150,000 arrobes of sugar.15

From St. Thomas, or possibly from Madeira,16 where they had for a long time been engaged in the sugar trade, the Jews transplanted the industry to Brazil, the largest of the American colonies. Brazil thus entered on its first period of prosperity, for the growth of the sugar industry brought with it the growth of the national wealth. In those early years the colony was populated almost entirely by Jews and criminals, two shiploads of them being brought thither annually from Portugal.17 The Jews quickly became the dominant class, “a not inconsiderable number of the wealthiest Brazilian traders were New Christians.”18 The first Governor-General was of Jewish origin, and he it was who brought order into the government of the colony. It is not too much to say that Portugal’s new possessions really began to thrive only after Thomé de Souza, a man of exceptional ability, was sent out in 1549 to take matters in hand.19 Nevertheless the colony did not reach the zenith of its prosperity until after the influx of rich Jews from Holland, consequent on the Dutch entering into possession in 1642. In that very year, a number of American Jews combined to establish a colony in Brazil, and no less than six hundred influential Dutch Jews joined them.20 Up to about the middle of the 17th century all the large sugar plantations belonged to Jews,21 and contemporary travellers report as to their many-sided activities and their wealth. Thus Nieuhoff, who travelled in Brazil from 1640 to 1649, says of them:22 “Among the free inhabitants of Brazil that were not in the (Dutch West India) Company’s service the Jews were the most considerable in number, who had transplanted themselves thither from Holland. They had a vast traffic beyond the rest; they purchased sugar-mills and built stately houses in the Receif. They were all traders, which would have been of great consequence to the Dutch Brazil had they kept themselves within the due bounds of traffic.” Similarly we read in F. Pyrard’s Travels:29 “The profits they make after being nine or ten years in those lands are marvellous, for they all come back rich.”

The predominance of Jewish influence in plantation development outlasted the episode of Dutch rule in Brazil, and continued, despite the expulsion of 1654,24 down to the first half of the 11th century.25 On one occasion, “when a number of the most influential merchants of Rio de Janeiro fell into the hands of the Holy Office (of the Inquisition), the work on so many plantations came to a standstill that the production and commerce of the Province (of Bahio) required a long stretch of time to recover from the blow.” Later, a decree of the 2nd March 1768 ordered all the registers containing lists of New Christians to be destroyed, and by a law of 25th March 1773 New Christians were placed on a footing of perfect civic equality with the orthodox. It is evident, then, that very many crypto-Jews must have maintained their prominent position in Brazil even after the Portuguese had regained possession of it in 1654, and that it was they who brought to the country its flourishing sugar industry as well as its trade in precious stones.

Despite this, the year 1654 marks an epoch in the annals of American-Jewish history. For it was in that year that a goodly number of the Brazilian Jews settled in other parts of America and thereby moved the economic centre of gravity.

The change was specially profitable to one or two important islands of the West Indian Archipelago and also to the neighbouring coastlands, which rose in prosperity from the time of the Jewish influx in the 17th century. Barbados, which was inhabited almost solely by Jews, is a case in point.26 It came under English rule in 1627; in 1641 the sugar cane was introduced, and seven years later the exportation of sugar began. But the sugar industry could not maintain itself. The sugar produced was so poor in quality that its price was scarcely sufficient to pay for the cost of transport to England. Not till the exiled “Dutchmen” from Brazil introduced the process of refining and taught the natives the art of drying and crystallizing the sugar did an improvement manifest itself. As a result, the sugar exports of Barbados increased by leaps and bounds, and in 1661 Charles II was able to confer baronetcies on thirteen planters, who drew an annual income of £10,000 from the island. By about the year 1676 the industry there had grown to such an extent that no fewer than 400 vessels each carrying 180 tons of raw sugar left annually.

In 1664 Thomas Modyford introduced sugar manufacturing from Barbados into Jamaica,27 which in consequence soon became wealthy. Now, while in 1656, the year in which the English finally wrested the island from Spain, there were only three small refineries in Jamaica, in 1670 there were already 75 mills at work, many of them having an output of 2000 cwts. By 1700 sugar was the principal export of Jamaica and the source of its riches. The petition of the English merchants of the colony in 1671, asking for the exclusion of the Jews, makes it pretty plain that the latter must have contributed largely to this development. The Government however, encouraged the settlement of still more Jews, the Governor in rejecting the petition remarking28 that “he was of opinion that his Majesty could not have more profitable subjects than the Jews and the Hollanders; they had great stocks and correspondence.” So the Jews were not expelled from Jamaica, but “became the first traders and merchants of the English colony.”29 In the 18th century they paid all the taxes and almost entirely controlled industry and commerce.

Of the other English colonies, the Jews showed a special preference for Surinam.30 Jews had been settled there since 1644 and had received a number of privileges—“whereas we have found that the Hebrew nation … have … proved themselves useful and beneficial to the colony.” Their privileged position continued under the Dutch, to whom Surinam passed in 1667. Towards the end of the 17th century their proportion to the rest of the inhabitants was as one to three, and in 1730 they owned 115 of the 344 sugar plantations.

The story of the Jews in the English and Dutch colonies finds a counterpart in the more important French settlements, such as Martinique, Guadeloupe, and San Domingo.81 Here also sugar was the source of wealth, and, as in the other cases, the Jews controlled the industry and were the principal sugar merchants.

The first large plantation and refinery in Martinique was established in 1655 by Benjamin Dacosta, who had fled thither from Brazil with 900 co-religionists and 1100 slaves.

In San Domingo the sugar industry was introduced as early as 1587, but it was not until the “Dutch” refugees from Brazil settled there that it attained any degree of success.

In all this we must never lose sight of the fact that in those critical centuries in which the colonial system was taking root in America (and with it modern capitalism), the production of sugar was the backbone of the entire colonial economy, leaving out of account, of course, the mining of silver, gold and gems in Brazil. Indeed, it is somewhat difiicult exactly to picture to ourselves the enormous significance in those centuries of sugar-making and sugar-selling. The Council of Trade in Paris (1701) was guilty of no exaggerated language when it placed on record its belief that “French shipping owes its splendour to the commerce of the sugar-producing islands, and it is only by means of this that the navy can be maintained and strengthened.” Now, it must be remembered that the Jews had almost monopolized the sugar trade; the French branch in particular being controlled by the wealthy family of the Gradis of Bordeaux. 32

The position which the Jews had obtained for themselves in Central and South America was thus a powerful one. But it became even more so when towards the end of the 17th century the English colonies in North America entered into commercial relations with the West Indies. To this close union, which again Jewish merchants helped to bring about, the North American Continent (as we shall see) owes its existence. We have thus arrived at the point where it is essential to consider the Jewish factor in the growth of the United States from their first origins. Once more Jewish elements combined, this time to give the United States their ultimate economic form. As this view is absolutely opposed to that generally accepted (at least in Europe), the question must receive full consideration.

At first sight it would seem as if the economic system of North America was the very one that developed independently of the Jews. Often enough, when I have asserted that modern capitalism is nothing more or less than an expression of the Jewish spirit, I have been told that the history of the United States proves the contrary. The Yankees themselves boast of the fact that they throve without the Jews. It was an American writer—Mark Twain, if I mistake not—who once considered at some length why the Jews played no great part in the States, giving as his reason that the Americans were as “smart” as the Jews, if not smarter. (The Scotch, by the way, think the same of themselves.) Now, it is true that we come across no very large number of Jewish names to-day among the big captains of industry, the well-known speculators, or the Trust magnates in the country. Nevertheless, I uphold my assertion that the United States (perhaps more than any other land) are filled to the brim with the Jewish spirit. This is recognized in many quarters, above all in those best capable of forming a judgment on the subject. Thus, a few years ago, at the magnificent celebration of the 250th anniversary of the first settlement of the Jews in the United States, President Roosevelt sent a congratulatory letter to the Organizing Committee. In this he said that that was the first time during his tenure of office that he had written a letter of the kind, but that the importance of the occasion warranted him in making an exception. The persecution to which the Jews were then subjected made it an urgent duty for him to lay stress on the splendid civic qualities which men of the Jewish faith and race had developed ever since they came into the country. In mentioning the services rendered by Jews to the United States he used an expression which goes to the root of the matter—“The Jews participated in the up-building of this country.”33 On the same occasion ex-President Cleveland remarked: “I believe that it can be safely claimed that few, if any, of those contributing nationalities have directly and indirectly been more influential in giving shape and direction to the Americanism of to-day.”34

Wherein does this Jewish influence manifest itself? In the first place, the number of Jews who took part in American business life was never so small as would appear at the first glance. It is a mistake to imagine that because there are no Jews among the half-dozen well-known multimillionaires, male and female, who on account of the noise they make in the world are on all men’s lips, therefore American capitalism necessarily lacks a Jewish element. To begin with, even among the big Trusts there are some directed by Jewish hands and brains. Thus, the Smelters’ Trust, which in 1904 represented a combination with a nominal capital of 201,000,000 dollars, was the creation of Jews—the Guggenheims. Thus, too, in the Tobacco Trust (500,000,000 dollars), in the Asphalt Trust, in the Telegraph Trust, to mention but a few, Jews occupy commanding positions.36 Again, very many of the large banking-houses belong to Jews, who in consequence exercise no small control over American economic life. Take the Harriman system, which had for its goal the fusion of all the American railways. It was backed to a large extent by

Kuhn, Loeb & Co., the well-known banking firm of New York. Especially influential are the Jews in the West California is for the most part their creation. At the foundation of the State Jews obtained distinction as Judges, Congressmen, Governors, Mayors, and so on, and last but not least, as business men. The brothers Seligman—William, Henry, Jesse and James—of San Francisco; Louis Sloss and Lewis Gerstle of Sacramento (where they established the Alaska Commercial Company), Hellman and Newmark of Los Angeles, are some of the more prominent business houses in this part of the world. During the gold-mining period Jews were the intermediaries between California and the Eastern States and Europe. The important transactions of those days were undertaken by such men as Benjamin Davidson, the agent of the Rothschilds; Albert Priest, of Rhode Island; Albert Dyer, of Baltimore; the three brothers Lazard, who established the international banking-house of Lazard Freres of Paris, London and San Francisco; the Seligmans, the Glaziers and the Wormsers. Moritz Friedlaender was one of the chief “Wheat kings.” Adolph Sutro exploited the Cornstock Lodes. Even to-day the majority of the banking businesses, no less than the general industries, are in the hands of Jews. Thus, we may mention the London, Paris and American Bank (Sigmund Greenbaum and Richard Altschul); the Anglo-Californian Bank (Philip N. Lilienthal and Ignatz Steinhart); the Nevada Bank; the Union Trust Company; the Farmers’ and Merchants’ Bank of Los Angeles; John Rosenfeld’s control of the coalfields; the Alaska Commercial Company, which succeeded the Hudson Bay Company; the North American Commercial Company, and many more.36

It can scarcely be doubted that the immigration of numerous Jews into all the States during the last few decades must have had a stupendous effect on American economic life everywhere. Consider that there are more than a million Jews in New York to-day, and that the greater number of the immigrants have not yet embarked on a capitalistic career. If the conditions in America continue to develop along the same lines as in the last generation, if the immigration statistics and the proportion of births among all the nationalities remain the same, our imagination may picture the United States of fifty or a hundred years hence as a land inhabited only by Slavs, Negroes and Jews, wherein the Jews will naturally occupy the position of economic leadership.

But these are dreams of the future which have no place in this connexion, where our main concern is with the past and the present. That Jews have taken a prominent share in American life in the present and in the past may be conceded; perhaps a more prominent share than would at first sight appear. Nevertheless, the enormous weight which, in common with many others who have the right of forming an opinion on the subject, I attach to their influence, cannot be adequately explained merely from the point of view of their numbers. It is rather the particular kind of influence that I lay stress on, and this can be accounted for by a variety of complex causes.

That is why I am not anxious to overemphasize the fact, momentous enough in itself, that the Jews in America practically control a number of important branches of commerce; indeed, it is not too much to say that they monopolize them, or at least did so for a considerable length of time. Take the wheat trade, especially in the West; take tobacco; take cotton. We see at once that they who rule supreme in three such mighty industries must perforce take a leading part in the economic activities of the nation as a whole. For all that I do not labour this fact, for to my mind the significance of the Jews for the economic development of the United States lies rooted in causes far deeper than these.

As the golden thread in the tapestry, so are the Jews interwoven as a distinct thread throughout the fabric of America’s economic history; through the intricacy of their fantastic design it received from the very beginning a pattern all its own.

Since the first quickening of the capitalistic spirit on the coastlands of the ocean and in the forests and prairies of the New World, Jews have not been absent; 1655 is usually given as the date of their first appearance. 37 In that year a vessel with Jewish emigrants from Brazil, which had become a Portuguese possession, anchored in the Hudson River, and the passengers craved permission to land in the colony which the Dutch West India Company had founded there. But they were no humble petitioners asking for a favour. They came as members of a race which had participated to a large extent in the new foundation, and the governors of the colony were forced to recognize their claims. When the ship arrived, New Amsterdam was under the rule of Stuyvesant, who was no friend to the Jews and who, had he followed his own inclination, would have closed the door in the face of the newcomers. But a letter dated March 26, 1665, reached him from the Court of the Company in Amsterdam, containing the order to let the Jews settle and trade in the colonies under the control of the Company, “also because of the large amount of capital which they have invested in shares of this Company.”38 It was not long before they found their way to Long Island, Albany, Rhode Island and Philadelphia.

Then their manifold activities began, and it was due to them that the colonies were able to maintain their existence The entity of the United States to-day is only possible, as we know, because the English colonies of North America, thanks to a chain of propitious circumstances, acquired i degree of power and strength such as ultimately led to their complete independence. In the building up of this position of supremacy the Jews were among the first and the keenest workers.

I am not thinking of the obvious fact that the colonies were only able to achieve their independence by the help of a few wealthy Jewish firms who laid the economic foundations for the existence of the New Republic. The United States would never have won complete independence has not the Jews supplied the needs of their armies and furnished them with the indispensable sinews of war. But what the Jews accomplished in this direction did not arise out of specifically American conditions. It was a general phenomenon, met with throughout the history of the modern capitalistic States, and we shall do justice to instances of it when dealing with wider issues.

No. What I have in mind is the special service which the Jews rendered the North American colonies, one peculiar to the American Continent—a service which indeed gave America birth. I refer to the simple fact that during the 17th and 18th centuries the trade of the Jews was the source from which the economic system of the colonies drew its lifeblood. As is well known, England forced her colonies to purchase all the manufactured articles they needed in the Mother-country. Hence the balance of trade of the colonies was always an adverse one, and by constantly having to send money out of the country they would have been drained dry. But there was a stream which carried the precious metals into the country, a stream diverted in this direction by the trade of the Jews with South and Central America. The Jews in the English colonies maintained active business relations with the West Indian Islands and with Brazil, resulting in a favourable balance of trade for the land of their sojourn. The gold mined in South America was thus brought to North America and helped to keep the economic system in a healthy condition.39

In the face of this fact, is there not some justification for the opinion that the United States owe their very existence to the Jews? And if this be so, how much more can it be asserted that Jewish influence made the United States just what they are—that is, American? For what we call Americanism is nothing else, if we may say so, than the Jewish spirit distilled.

But how comes it that American culture is so steeped in Jewishness? The answer is simple—through the early and universal admixture of Jewish elements among the first settlers. We may picture the process of colonizing somewhat after this fashion. A band of determined men and women—let us say twenty families—went forth into the wilds to begin their life anew. Nineteen were equipped with plough and scythe, ready to clear the forests and till the soil in order to earn their livelihood as husbandmen. The twentieth family opened a store to provide their companions with such necessaries of life as could not be obtained from the soil, often no doubt hawking them at the very doors. Soon this twentieth family made it its business to arrange for the distribution of the products which the other nineteen won from the soil. It was they, too, who were most likely in possession Of ready cash, and in case of need could therefore be useful to the others by lending them money. Very often the store had a kind of agricultural loan-bank as its adjunct, perhaps also an office for the buying and selling of land. So through the activity of the twentieth family the farmer in North America was from the first kept in touch with the money and credit system of the Old World. Hence the whole process of production and exchange was from its inception along modern lines. Town methods made their way at once into even the most distant villages. Accordingly, it may be said that American economic life was from its very start impregnated with capitalism. And who was responsible for this? The twentieth family in each village. Need we add that this twentieth family was always a Jewish one, which joined a party of settlers or soon sought them out in their homesteads?

Such in outline is the mental picture I have conceived of the economic development of the United States. Subsequent writers dealing with this subject will be able to fill in more ample details; I myself have only come across a few. But these are so similar in character that they can hardly be taken as isolated instances. The conclusion is forced upon us that they are typical. Nor do I alone hold this view. Governor Pardel of California, for example, remarked in 1905: “He (the Jew) has been the leading financier of thousands of prosperous communities. He has been enterprising and aggressive.”40

Let me quote some of the illustrations I have met with. In 1785 Abraham Mordccai settled in Alabama. “He established a trading-post two miles west of Line Creek, carrying on an extensive trade with the Indians, and exchanging his goods for pinkroot, hickory, nut oil and peltries of all kinds.”41 Similarly in Albany: “As early as 1661, when Albany was but a small trading post, a Jewish trader named Asser Levi (or Leevi) became the owner of real estate there.”42 Chicago has the same story. The first brick house was built by a Jew, Benedict Schubert, who became the first merchant tailor in Chicago, while another Jew, Philip Newburg, was the first to introduce the tobacco business.43 In Kentucky we hear of a Jewish settler as early as 1816. When in that year the Bank of the United States opened a branch in Lexington, a Mr. Solomon, who had arrived in 1808, was made cashier.44 In Maryland,45 Michigan,46 Ohio47 and Pennsylvania48 it is on record that Jewish traders were among the earliest settlers, though nothing is known of their activity.

On the other hand, a great deal is known of Jews in Texas, where they were among the pioneers of capitalism. Thus, for example, Jacob de Cordova “was by far the most extensive land locator in the State until 1856.” The Cordova’s Land Agency soon became famous not only in Texas but in New York, Philadelphia and Baltimore, where the owners of large tracts of Texas land resided. Again, Morris Koppore in 1863 became President of the National Bank of Texas. Henry Castro was an immigration agent; “between the years 1843–6 Castro introduced into Texas over 5000 immigrants … transporting them in 27 ships, chiefly from the Rhenish provinces.… He fed his colonists for a year, furnished them with cows, farming implements, seeds, medicine, and in short with everything they needed.”49

Sometimes branches of one and the same family distributed themselves in different States, and were thereby enabled to carry on business most successfully. Perhaps thebest instance is the history of the Seligman family. There were eight brothers (the sons of David Seligman, of Bayersdorf, in Bavaria) who started a concern which now has branches in all the most important centres in the States. Their story began with the arrival in America in the year 1837 of Joseph Seligman. Two other brothers followed in 1839; a third came two years later. The four began business as clothiers in Lancaster, moving shortly after to Selma, Ala. From here they opened three branches in three other towns. By 1848 two more brothers had arrived from Germany and the six moved North. In 1850, Jesse Seligman opened a shop in San Francisco—in the first brick house in that city. Seven years later a banking business was added to the clothing shop, and in 1862 the house of Seligman Brothers was established in New York, San Francisco, London, Paris and Frankfort.50

In the Southern States likewise the Jew played the part of the trader in the midst of agricultural settlers.51 Here also (as in Southern and Central America) we find him quite early as the owner of vast plantations. In South Carolina indeed, “Jew’s Land” is synonymous with “Large Plantations.”52 It was in the South that Moses Lindo became famous as one of the first undertakers in the production of indigo.

These examples must suffice. We believe they tend to illustrate our general statement, which is supported also by the fact that there was a constant stream of Jewish emigration to the United States from their earliest foundation. It is true that there are no actual figures to show the proportion of the Jewish population to the total body of settlers. But the numerous indications of a general nature that we do find make it pretty certain that there must always have been a large number of Jews in America.

It must not be forgotten that in the earliest years the population was thinly scattered and very sparse. New Amsterdam had less than 1000 inhabitants.53 That being so, a shipful of Jews who came from Brazil to settle there made a great difference, and in assessing Jewish influence on the whole district we shall have to rate it highly.54 Or take another instance. When the first settlement in Georgia was established, forty Jews were among the settlers. The number may seem insignificant, but when we consider the meagre population of the colony, Jewish influence must be accounted strong. So, too, in Savannah, where in 1733 there were already twelve Jewish families in what was then a tiny commercial centre.55

That America early became the goal of German and Polish Jewish emigrants is well known. Thus we are told: “Among the poorer Jewish families of Posen there was seldom one which in the second quarter of the 19th century did not have at least one son (and in most cases the ablest and not least enterprising) who sailed away across the ocean to flee from the narrowness and the oppression of his native land.”56 We are not surprised, therefore, at the comparatively large number of Jewish soldiers (7243 )57 who took part in the Civil War, and we should be inclined to say that the estimate which puts the Jewish population of the United States about the middle of the 19th century at 300,000 (of whom 30,000 lived in New York)58 was if anything too moderate.

Chapter 5: 
The Foundation of the Modern State

The development of the modern colonial system and the establishment of the modern State are two phenomena dependent on one another. The one is inconceivable without the other, and the genesis of modern capitalism is bound up with both. Hence, in order to discover the importance of any historic factor in the growth of capitalism it will be necessary to find out what, and how great a part that factor played in both the colonial system and the foundation of the modern State. In the last chapter we considered the Jews in relation to the colonial system; in the present we shall do the same for the modern State.

A cursory glance would make it appear that in no direction could the Jews, the “Stateless” people, have had less influence than in the establishment of modern States. Not one of the statesmen of whom we think in this connexion was a Jew—neither Charles the Fifth, nor Louis the Eleventh, neither Richelieu, Mazarin, Colbert, Cromwell, Frederick William of Prussia nor Frederick the Great.1 However, when speaking of these modern statesmen and rulers, we can hardly do so without perforce thinking of the Jews: it would be like Faust without Mephistopheles. Arm in arm the Jew and the ruler stride through the age which historians call modern. To me this union is symbolic of the rise of capitalism, and consequently of the modern State. In most countries the ruler assumed the role of protector of the persecuted Jews against the Estates of the Realm and the Gilds—both pre-capitalistic forces. And why? Their interests and their sympathies coincided. The Jew embodied modern capitalism, and the ruler allied himself with this force in order to establish, or maintain, his own position. When, therefore, I speak of the part played by the Jews in the foundation of modern States, it is not so much their direct influence as organizers that I have in mind, as rather their indirect co-operation in the process. I am thinking of the fact that the Jews furnished the rising States with the material means necessary to maintain themselves and to develop; that the Jews supported the army in each country in two ways, and the armies were the bulwarks on which the new States rested. In twoways: on the one hand, the Jews supplied the army in time of war with weapons, and munition and food; on the other hand, they provided money not only for military purposes but also for the general needs of courts and governments. The Jews throughout the 16th, 17th and 18th centuries were most influential as army-purveyors and as the moneyed men to whom the princes looked for financial backing. This position of the Jews was of the greatest consequence for the development of the modern State. It is not necessary to expatiate on this statement; all that we shall do is to adduce instances in proof of it. Here, too, we cannot attempt to mention every possible example. We can only point the way; it will be for subsequent research to follow.

The Jews as Purveyors

Although there are numerous cases on record of Jews acting in the capacity of army-contractors in Spain previous to 1492, I shall not refer to this period, because it lies outside the scope of our present considerations. We shall confine ourselves to the centuries that followed and begin with England.

In the 17th and 18th centuries the Jews had already achieved renown as army-purveyors. Under the Commonwealth the most famous army-contractor was Antonio Fernandez Carvajal, “the great Jew,” who came to London some time between 1630 and 1635, and was very soon accounted among the most prominent traders in the land. In 1649 he was one of the five London merchants entrusted by the Council of State with the army contract for corn.2 It is said that he annually imported into England silver to the value of £100,000. In the period that ensued, especially in the wars of William III, Sir Solomon Medina (“the Jew Medina”) was “the great contractor,” and for his services he was knighted, being the first professing Jew to receive that honour.3

It was the same in the wars of the Spanish Succession; here, too, Jews were the principal army-contractors.4 In 1716 the Jews of Strassburg recall the services they rendered the armies of Louis XIV by furnishing information and supplying provisions.8 Indeed, Louis XIV’s army-contractor-in-chief was a Jew, Jacob Worms by name;6 and in the 18th century Jews gradually took a more and more prominent part in this work. In 1727 the Jews of Metz brought into the city in the space of six weeks 2000 horses for food and more than 5000 for remounts.7 Field-Marshal Maurice of Saxony, the victor of Fontenoy, expressed the opinion that his armies were never better served with supplies than when the Jews were the contractors.8 One of the best known of the Jewish armycontractors in the time of the last two Louis was Cerf Beer, in whose patent of naturalization it is recorded that “... in the wars which raged in Alsace in 1770 and 1771 he found the opportunity of proving his zeal in our service and in that of the State.”9

Similarly, the house of the Gradis, of Bordeaux, was an establishment of international repute in the 18th century. Abraham Gradis set up large storehouses in Quebec to supply the needs of the French troops there.10 Under the Revolutionary Government, under the Directory, in the Napoleonic Wars it was always Jews who acted as purveyors.11 In this connexion a public notice displayed in the streets of Paris in 1795 is significant. There was a famine in the city and the Jews were called upon to show their gratitude for the rights bestowed upon them by the Revolution by bringing in corn. “They alone,” says the author of the notice, “can successfully accomplish this enterprise, thanks to their business relations, of which their fellow citizens ought to have full benefit.” 12 A parallel story comes from Dresden. In 1720 the Court Jew, Jonas Meyer, saved the town from starvation by supplying it with large quantities of corn. (The Chronicler mentions 40,000 bushels.)18

All over Germany the Jews from an early date were found in the ranks of army-contractors. Let us enumerate a few of them. There was Isaac Meyer in the 16th century, who, when Cardinal Albrecht admitted him a resident of Halberstadt in 1537, was enjoined by him, in view of the dangerous times, “to supply our monastery with good weapons and armour.” There was Joselman von Rosheim, who in 1548 received an imperial letter of protection because he had supplied both money and provisions for the army. In 1546 , there is a record of Bohemian Jews who provided great; coats and blankets for the army.14 In the next century (1633) another Bohemian Jew, Lazarus by name, received an offiicial declaration that he “obtained either in person, or at his own expense, valuable information for the Imperial troops, and that he made it his business to see that the army had a good supply of ammunition and clothing.”15 The Great Elector also had recourse to Jews for his military needs. Leimann Gompertz and Solomon Elias were his contractors for cannon, powder and so forth.16 There were numerous others: Samuel Julius, remount contractor under the Elector Frederick Augustus of Saxony; the Model family, court-purveyors and army-contractors in the Duchy of Ansbach in the 17th and 18th centuries are well known.17 In short, as one writer of the time pithily expresses it, “all the contractors are Jews and all the Jews are contractors.”18

Austria does not differ in this respect from Germany, France and England. The wealthy Jews, who in the reign of the Emperor Leopold received permission to re-settle in Vienna (1670)—the Oppenheimers, Wertheimers, Mayer Herschel and the rest—were all army-contractors.19 And we find the same thing in all the countries under the Austrian Crown.20 Lastly, we must mention the Jewish army-contractors who provisioned the American troops in the Revolutionary and Civil Wars.21

The Jews as Financiers

This has been a theme on which many historians have written, and we are tolerably well informed concerning this aspect of Jewish history in all ages. It will not be necessary for me, therefore, to enter into this question in great detail; the enumeration of a few well-known facts will suffice.

Already in the Middle Ages we find that everywhere taxes, saltmines and royal domains were farmed out to Jews; that Jews were royal treasurers and money-lenders, most frequently, of course, in the Pyrenean Peninsula, where the Almoxarife and the Rendeiros were chosen preferably from among the ranks of the rich Jews. But as this period does not specially concern us here, I will not mention any names but refer the reader to the general literature on the subject.22

It was, however, in modern times, when the State as we know it today first originated, that the activity of the Jews as financial advisers of princes was fraught with mighty influence. Take Holland, where although officially deterred from being servants of the Crown, they very quickly occupied positions of authority. We recall Moses Machado, the favourite of William III; Delmonte, a family of ambassadors (Lords of Schoonenberg); the wealthy Suasso, who in 1688 lent William two million gulden, and others.23

The effects of the Jewish haute finance in Holland made themselves felt beyond the borders of the Netherlands, because that country in the 17th and 18th centuries was the reservoir from which all the needy princes of Europe drew their money. Men like the Pintos, Delmontes, Bueno de Mesquita, Francis Mels and many others may in truth be regarded as the leading financiers of Northern Europe during that period.24

Next, English finance was at this time also very extensively controlled by Jews.25 The monetary needs of the Long Parliament gave the first impetus to the settlement of rich Jews in England. Long before their admission by Cromwell, wealthy crypto-Jews, especially from Spain and Portugal, migrated thither via Amsterdam: the year 1643 brought an exceptionally large contingent. Their rallying-point was the house of the Portuguese Ambassador in London, Antonio de Souza, himself a Maranno. Prominent among them was Antonio Fernandez Carvajal, who has already been mentioned, and who was as great a financier as he was an army contractor. It was he who supplied the Commonwealth with funds. The little colony was further increased under the later Stuarts, notably under Charles the Second. In the retinue , of his Portuguese bride, Catherine of Braganza, were quite a number of moneyed Jews, among them the brothers Da Sylva, Portuguese bankers of Amsterdam, who were entrusted with the transmission and administration of the Queen’s dowry.26 Contemporaneously with them came the Mendes and the Da Costas from Spain and Portugal, who united their families under the name of Mendes da Costa.

About the same period the Ashkenazi (German) Jews began to arrive in the country. On the whole, these could hardly compare for wealth with their Sephardi (Spanish) brethren, yet they also had their capitalistic magnates, such as Benjamin Levy for example.

Under William III their numbers were still further increased, and the links between the court and the rich Jews were strengthened. Sir Solomon Medina, who has also been already mentioned, followed the King from Holland as his banker, and with him came the Suasso, another of the plutocratic families. Under Queen Anne one of the most prominent financiers in England was Menasseh Lopez, and by the time the South Sea Bubble burst, the Jews as a body were the greatest financial power in the country. They had kept clear of the wild speculations which had preceded the disaster and so retained their fortunes unimpaired. Accordingly, when the Government issued a loan on the Land Tax, the Jews were in a position to take up one quarter of it. During this critical period the chief family was that of the