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THE JEWISH ENCYCLOPEDIA

which the capital hitherto diverted to warlike operations was transferred to industrial enterprise, owing to the introduction of steam. This was mainlyoperated from London with English capital and the Jews did only a small portion of the business connected with the introduction of machinery and railroads into European commerce. But the international connections of great Jewish families, such as the Rothschilds, Sterns, Pereires, Hirschs, and Bischoffsheims caused them to be of considerable importance in the issuing of state loans between 1820 and 1860. Up to 1848 the practise of apportioning loans to large banking firms, who then distributed them to the public in smaller lots, was carried out; and in this way the Rothschilds especially had a quasi-monopoly of the loan market. In the fifties, however, their monopoly of international finance was broken down by the formation throughout western Europe of credit banks, many of them founded by associations of Jewish bankers of smaller caliber than the great financial families. Thus the Credit Mobilier of 1852 was founded by the Pereires, Solomon Heine, and D'Eichthal (M. Aycard, "Histoire du Credit Mobilier," 1867). The practise, after the year 1848, of opening the subscription to the loans to the public in general also tended to break

down

the

monopoly of the great Jewish

financial

firms. It may be worth while to remark here that the idea promoted generally by anti-Semitic writers that the resources of all Jewish capitalists formed one fund is ludicrously at variance with Capitalists the facts of the case. Heine, in a corInvest in respondence to the Augsburg "AllgeRailroads. meine Zeitung," dated May 27, 1840, and reprinted in " Franzbsische Zustande," refers to Rothschild and Pould as two " rabbis of finance," opposed just as strenuously to each other as were once " Rabbi Shammai and Rabbi Hillel in the old city of Babylon." (sic). Jewish firms competed with one another with as much eagerness as they did against non-Jewish firms. The Pereires, for example, obtained a concession for South Russian railways against the Rothschilds in 1856 (Reeves, " The Rothschilds," p. 334). With the introduction of railroads on the Continent many of the firms previously mentioned were closely connected, the Pereires with those of northern France, the Bishoffsheims with those of Belgium, and Baron de Hirsch with those of Turkey. Many Jewish firms and credit banks, especially the house of Bleiehroeder,were concerned with the growth of railways in Germany and Austria. It was Baron Bleichroeder who operated the transfers of the milliards from France to Germany after the Franco-Prussian war. But with the nationalization of the German railroads the field of opera-

tion of the Jewish banking-houses in Germany was transferred from railroads to other industries which

they have largely helped to create.

Throughout the latter half of the nineteenth century, however, others had been learning the secret of international connections, and by 1900 the monopoly of international finance had largely passed from Jewish hands. An organized attempt to precipitate this

was made about 1885 by a number

financiers in France,

who

of Catholic constituted the Union

Banking Bankruptcy

Generale to overcome the financial predominance of the Jewish capitalists (Rothschilds, Pereires, etc.); but it proved a disastrous failure, and much of French anti-Semitism has been traced to this cause. Similarly, it is stated that the financial crisis of Germany and Austria in 1873, in which the inflation due to the introduction of the milliards came to an end, was also a source of anti-Semitism, because the shrewdness of the Jewish bankers had foreseen the

and they were enabled to evade it. After the Crimean war, Jews contributed largely to the development of Banking in Russia; Barons crash,

Joseph and Horace Gunzburg and Leon Rosenthal, of St. Petersburg, Banking organized many commercial banks, Houses, and placed government loans in the German and French money-markets. The Kronenbergs and Ivan Blioch, of Warsaw, as well as Efrussi and Rafalovich, of Odessa, should be mentioned in connection with Russian banking. Attention may be drawn to one side of Italian Banking with which the name of a Jew is prominently connected, though he himself is not a banker. The finance minister Luigi Luzzati introduced into Italy about 1864 the Schultze-Delitzsch method of agricultural cooperative banks. This system has been very effective in helping the Italians to tide over times of distress, and has quite revolutionized

Russian

the condition of Italian agriculture. In the United States there has never been any marked influence of capital controlled by Jews either on the stock exchanges or in the great industrial connections, the opportunities for international connections being only slight. But in the two great wars Jewish financiers played a considerable r61e, owing doubtless to their European connections: Haym Solomon in the In the Revolutionary war (see " Transactions United of the Jewish Historical Society of America," passim), while Seligman States. Bros, and Speyer Co. financed the North, and Messrs. Erlanger the South (J. C. Schwab, "Confederate States of America," p. 102, New York, 1901), in the great Civil war. More recently, in the great development of railway finance, the firm of Kuhn, Loeb Co. has taken a prominent

&

&

position.

Altogether, the influence of Jews on Banking has been only short-lived, and was due to the preliminary advantage given to them by their international position, which is nowadays shared by them with others. It is a significant fact that at the beginning of the twentieth century the typical Jewish bankinghouse of Rothschilds gave up its original foundation at Frankfort. J.

r>.

BANKRUPTCY

In modern law, the proceeding taken by the courts of justice with regard to debtors unable to pay their debts in full, when all the creditors become parties to the proceeding. The object of bankruptcy laws is twofold first, equality among creditors second, the discharge of the debtor, so that his future earnings may be free from levy





for his old debts. ical

There

is

no trace

in the rabbin-

jurisprudence of anything like a discharge in