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Jewish Idea in American Monetary Affairs

The Remarka ble Story of Paul Warburg, Who Began Work on the United

States Monetary System After Three Weeks' Residence in the Country

MR. BRISBANE says that Jewish bankers exer

cise their large measure of control because they

ire abler than the other bankers. It was very

good of Mr. Brisbane to say so, and it adds to the

sum of his weekly, almost daily, worship at the Jewish

shrine, but it is scarcely true. Jewish bankers do not

yet control the United States, and the principal reason

they do not is that they are not abler than the other

bankers. Doubtless they seek control : doubtless they

have almost grasped it on several occasions ; but not yet.

Nevertheless they form such a formidable force,

and with their international connections constitute such

a political problem, that the mere fact of their failing

to top the column of control is not so reassuring as

it sounds.

The great Jewih banking houses of the United

States are foreign importations, as perhaps everyone

knows. Most of them are sufficiently recent to be con

sidered in their immigrant status, while the thought of

them as aliens is stimulated by their retention of over

sea connections. It is this international quality of

the Jewish banking group which largely accounts for

Jewish financial power : there is team-play, intimate un

derstandings, and while there is a margin of competi

tion among themselves (as at golf) there is also a

wiping out of that margin when it comes to a con

test between Jewish and "Gentile" capital.

Four Jewish-American Financiers

FOUR conspicuous contemporary names in Jewish

American finance are Belmont, SchirT, Warburg and

Kahn. All of them, even the most recent, are of for

eign origin.

August Belmont was the earliest and arrived in

America in 1837 as the American representative of the

Rothschilds in whose offices he had been raised. His

birthplace was that great center of Jewish international

finance, Frankfort-on-the-Main. He became the founder

of the Belmont family in America, which has largely

forgotten its Jewish origin. Politics was a part of

his concern in this country, and during the critical

time from 1860 to 1872 he was chairman of the na

tional Democratic committee. His management of the

Rothschild interests was exceedingly profitable to that

house, although the operations in which he engaged

were quite simple compared with the operations of the

present day.

Jacob Schiff is another Jewish financier who was

given to the world by Frankfort-on-the-Main. He

entered the United States in 1865, after having passed

his apprenticeship in the office of his father, who was

also an agent of the Rothschilds. The name Schiff runs

a long way back without change, unlike the name of

Rothschild. Originally named Bauer, this family of

financiers took a new name from the red shield which

adorned their house in the Jewish section of Frankfort

and thus became "Rot-schild." Commonly the last syl

lable is pronounced as if it were "child"; it is "schild,"

shield. An epoch-making family in itself, it has trained

hundreds of agents and apprentices, of whom Jacob

H. Schiff was one. He became one of the principal

channels through which German-Jewish capital flowed

into American undertakings, and his agency in these

matters gave him a place in many important depart

ments of American business, especially railroads, banks,

insurance companies and telegraph companies. He

married Theresa Loeb, and in due time came to be head

of the firm of Kuhn, Loeb & Company.

The International Mr. Kahn

MR. SCHIFF, too, was interested in politics with a

Jewish angle, and was perhaps the moving force in

the campaign which forced Congress and the President

to break off treaty relations with Russia, then a friendly

nation, on a strictly Jewish question which had been

skillfully given an American aspect. Mr. Schiff was

of inestimable assistance to Japan in the war against

Russia, but is understood to have been disappointed by

Japan's shrewdness in preventing too high a return

being made for that assistance.

Associated with Mr. Schiff in Kuhn, Loeb & Com

pany is Otto Herman Kahn, who is probably more in

ternational than were either of the two gentlemen men

tioned ibove and is more constantly engaged in dabbling

in mysterious matters of an international nature. This

characteristic may be accounted for, however, by his

experience of many countries. He was born in Ger

many and is also a product of the Frankfort-on-the-Main

school of finance, having had connections with

the Frankfort Jewish house of Speyer.

Of just how many countries Mr. Kahn has been a

citizen is a question not easy to determine here because

of the doubt that was recently cast upon his American

citizenship by a protest against his being permitted to

cast his vote last year and by his failure the an

nounced cause being physical indisposition to cast his

vote. If Mr. Kahn is a citizen of the United States (a

status that will be readily proclaimed upon proof that

he is), that probably increases the number of his cit

izenships to three. He was a German citizen by birth,

and served in the German Army. And in 1914, in

August, at the time of the outbreak of the European

War, when efforts were being made, which afterward

succeeded, to put Paul M. Warburg, a member of the

firm of Kuhn, Loeb & Company, on the Federal Re

serve Board, Mr. Warburg testified that at that time

Mr. Kahn was not a citizen of the United States.

Senator Bristow "How many of these part

ners are American citizens, or are they all Amer

ican citizens . . . ."

Mr. Warburg "They are all American citi

zens except Mr. Kahn." (P. 7, Senate Hearings,

August 1, 1914.)

Senator Bristow "Now, the members of your

firm, arc they all American citizens except Mr.

Kahn?

Mr. Warburg "Except Mr. Kahn, yes."

Senator Bristow "Was Mr. Kahn ever an

American citizen?"

Mr. Warburg "No."

Senator Bristow "He never was?"

Mr. Warburg "No; he is a British subject."

Senator Bristow "He is a British subject?"

The Chairman "He lives in England, does he

not."

Mr. Warburg "No. At one time he thought

he would move to Europe, and that was when the

question arose of his standing for Parliament;

then he changed his mind and moved back to the

United States."

Senator Bristow "He was at one time a can

didate, or a prospective candidate for Parlia

ment, was he not?"

Mr. Warburg "No; he was not; but there was

talk about it; it had been suggested, and he had

it in his mind. Something had been written about

it in the papers." (P. 76, Senate Hearings, Au

gust 3, 1914.)

So, that if Mr. Kahn is a citizen of the United

States now, which as a matter of fact has been dis

puted, then he has been a citizen of three countries,

Germany and Great Britain being the other two.

Enter Paul Moritz Warburg

i R. KAHN, by the way, is one of those Jews whose

adoption of another form of faith brings no de

nunciation whatever from the Jews themselves. A most

peculiar circumstance! But doubtless not inexplicable.

Mr. Kahn is not called a "renegade Jew" nor any of the

other nasty names heaped upon Jewish converts to Chris

tianity, because he does rot deserve them. They would

not fit him. He is not renegade. And he never was

regarded for a moment by Jacob H. Schiff as anything

but a Jew, else that "Prince of Israel" would not have

chosen him to remain in America and run the business

of Kuhn, Loeb & Company, at a time when it seemed

undesirable to put the junior Schiff in full charge of

it.

Doubtless it was Mr. Kahn's desire, just at the time

Jacob Schiff made his wishes known, to go to Eng

land and stand for Parliament.

But from New York he fulfills, probably as well as

he could from London, those mysterious missions which

frequently take him to the Continent, at which time

he makes what are regarded as certain authoritative

decisions, though just whose decisions it is not always

possible to say. In Paris particularly, and at points

east thereof, Mr. Kahn has been established in the

position of spokesman of the merican Financial Hier

archy, which, of course, he is not. But he undoubtedly

i the spokesman of some group, possibly the group

which to ably put through the Jewish program at the

Peace Conference, the group that impressed Eastern

Europe with the feeling that the United State

America was a very powerful Semitic empire. M

Kahn's trips abroad are usually unheralded, but th

results richly repay observation.

A fourth member of the Jewish financial group L

America (which is the form of statement which fr

Chaim Weizmann would sanction, rather than to '

"Jewish-American financiers") is Mr Paul YVa b

to whose testimony we have just alluded.

Mr. Warburg is the most recent of all. He wa

born in Germany in 1868; he came to the United Stat'

in 1902; he became an American citizen in 1911 H

came to the United States for the express purpose of

reforming our financial system, and it is hardly po

sible to understand fully the system in operation to

day without reference to Paul Warburg. He is a man

of very fine mind, a money-maker, but something more

a shrewd student of the systems by which money is

made. There are two types engaged in the mere work

of money-making which is better described as "money

getting," without reference to production; one type

grubs away under whatever system obtains, regarding

it as fixed as the solar system J another type is suf

ficiently detached to see the system as an artifice which

may be mended, remodeled or supplanted altogether

Paul Warburg, scion of a long line of German Jewish

bankers, is of the latter type. He is not content with

the fact that the cash-register fills itself with money;

he wants also to know how the cash-register works,

and whether it can be worked. He is thus a student

of money and of the number of ways in which it can

be manipulated.

The Internationalism of Mr. IVarburt

DERHAPS it will be best to let him tell his own story

I as far as he goes. When he told it to the Committee

on Banking and Currency of the United States Senate

in executive session, there was some dispute as to

whether the proceedings should be recorded by the

stenographer. It was finally agreed that notes should

be made but should not be divulged. The testimony was

printed "in confidence" on August 5, 1914, and nom

inally "made public" on August 12.

The Warburgs are one of the international families

whose importance was not realized until the war, and

would not have been realized then if their interna

tionalism had not been so apparent. It was an inter

esting spectacle to see brothers occupying important

places of counsel on either side of the great struggle.

Paul Warburg learned the rudiments of banking in

his father's bank at Hamburg, Germany, studying the

over-sea trade which is the foundation of that city s

business. The banking house of Warburg in Hamburg

dates from 1796.

"After that I went to England, where I stayed for

two years, first in the banking and discount firm ot

Samuel Montague & Company, and after that I took

the opportunity of staying two months in the office ot

a stockbroker in order to learn that part of the

business.

"After that I went to France, where I stayed in a

French bank, so that

The Chairman "What French bank was that?

Mr. Warburg "It is the Russian bank for foreign

trade, which has an agency in Paris.

"And after that I went back to Hamburg and worke

there again for a year, I think.

"Then I went round to India, China and Japan.

"And then I came to this country for the first W

in 1893. I stayed here only a short time then,

went back to Hamburg, and then became a partner

the firm in Hamburg."

The Chairman "How long were you in Ham u

then in the banking business?"

Mr. Warburg-"Until 1902 And then

over here to this country to become a partner o

Loeb & Company."

Ties of Race, Money and Domesticity

4(1 EXPLAINED in the curriculum which I g

1 Mr. Chairman, that by marriage I am j

members of the firm, the late Mr. Loeb having

father-in-law, which brought about a desire o q

of the family to bring me over here . 5 an(j

say that I got married in this country V