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He who waits for the wind will not sow, and he who looks at the clouds will not reap. Kohelet 11:4 |
Joseph Seligman (1819–1880) was a prominent U.S. banker, and businessman. He has been described as a "robber baron". He was born in Baiersdorf, Germany, emigrating to the United States when he was 18. With his brothers, he started a bank, J. & W. Seligman & Co., with branches in New York, San Francisco, New Orleans, London, Paris and Frankfurt.
In the post-Civil War Gilded Age, J. & W. Seligman & Co. invested heavily in railroad finance, in particular acting as broker of transactions engineered by Jay Gould. They underwrote the securities of a variety of companies, participating in stock and bond issues in the railroad and steel and wire industries, investments in Russia and Peru, the formation of the Standard Oil Company, and shipbuilding, bridges, bicycles, mining, and a variety of other industries. In 1877, Seligman was involved in the most publicized antisemitic incident in American history up to that point, being denied entry into the Grand Union Hotel in Saratoga Springs, New York.
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As a small child, Seligman worked in his mother's dry goods shop. Present-day Germany consisted of many independent states in the early 19th century, most of which issued their own, differing coinages; and young Joseph made a profit at his mother's store changing money for travelers for a small fee.
Joseph's father wanted him to enter the family wool business, but circumstances made this difficult; in particular, migration of the peasant class (Seligman's father's customers) from rural areas to urban meant a loss of job opportunities and a shrinking economic base in Baiersdorf.
At fourteen, Seligman attended the University of Erlangen. At seventeen, he boarded a steamer at Bremen and sailed to America.
Seligman initially settled in Mauch Chunk, Pennsylvania, where he went to work as a cashier/clerk for Asa Packer, who later become a United States congressman. His salary was $400.00 a year.
Using his savings from work, Seligman began selling goods door to door in rural Pennsylvania (jewelry, knives, smaller goods), saving outlying farmers the trouble of coming into town to buy their goods. After saving $500, Seligman was able to send to Germany for his brothers William and James, who joined him in peddling.
The Seligmans encountered some antisemitic abuse in their interactions with Americans, though they were not discouraged from continuing to sell.
Seilgman's firm made a number of investments in railroads. Among these were the Missouri Pacific, the Atlantic and Pacific Railroad, the South Pacific Coast Railroad, and the Missouri-Kansas-Texas Railroad. They also helped finance New York's first elevated railway.
The Seligmans tended to lose money on their railroad ventures. One example is buying land in Arizona that was to be used for grazing cattle, which could then be transported on the Atlantic and Pacific Railroad line. However, the aridity of Arizona made it unsuitable for the venture.
During the American Civil War, Seligman was responsible for aiding the Union by disposing of $200,000,000 in bonds "a feat which W. E. Dodd said was 'scarcely less important than the Battle of Gettysburg.'"
Later historians have suggested that Seligman's role in financing the war through bonds has been exaggerated. According to Stephen Birmingham, Seligman was obliged to accept "7.30 bonds" from the Union Government as payment for the uniforms his factory was delivering. Union defeats (combined with a suspiciously high interest rate) lowered confidence in the bonds, making them difficult to sell.
President Ulysses S. Grant, who had befriended Jesse Seligman when he was a First Lieutenant near Watertown, New York, offered Joseph Seligman the post of United States Secretary of the Treasury, which he declined, possibly due to shyness. George Sewall Boutwell accepted the position and eventually clashed with the Seligmans.
In 1877, President Rutherford Hayes asked Seligman, August Belmont, and a number of other New York bankers to come to Washington, D.C., to plan a refinancing of the war debt. Each banker submitted a plan, but Secretary of the Treasury Sherman accepted Seligman's plan as being the most practical. It involved retaining gold reserves totaling forty percent of circulating greenbacks through bond sales.
In 1877, Judge Henry Hilton, the owner of the Grand Union Hotel in Saratoga, New York, denied entry to Joseph Seligman and his family because they were Jews, creating nationwide controversy. It was the first antisemitic incident of its kind in the United States to achieve widespread publicity.
During the 1870s, several incidents made Alexander Stewart hostile towards Seligman, although the two men had served together on the board of the New York Railway Company (whose president was Judge Henry Hilton), a Tweed Ring associate.
The first incident involved Seligman's declining the post of Secretary of the Treasury. Stewart, who was a friend of President Grant, was then offered the post. However, because he was associated with Henry Hilton and Hilton, with Tammany Hall, the Senate declined to confirm him.
Seligman was invited to serve in the Committee of Seventy, a group of New Yorkers who banded together to fight the Tweed Ring. Stewart's company, in retaliation, stopped doing business with Seligman.
Stewart died in 1876, having placed Hilton in charge of his estate, the largest American fortune recorded to that date. The estate included a two-million-dollar stake in the Grand Union Hotel in Saratoga, as well as A. T. Stewart's department store on Astor Place. Hilton himself was unhappy with Seligman, as he was annoyed that Seligman had not invited him to a dinner given for Grant after he became president.
After helping refinance the war debt in Washington, Seligman decided to vacation with his family at the 834-room Grand Union Hotel in Saratoga, where he had stayed before. Saratoga at the time was a well-regarded resort area for upperclass New Yorkers, and the Grand Union Hotel itself was the best available.
Nevertheless, by 1877 the hotel had suffered a drop in business. Stewart and, after his death, his manager Hilton believed that the cause of the decline was the presence of "Israelites" (that is, Jews) at the hotel; Christians, their theory went, did not wish to stay at a hotel that admitted Jews. Seligman was told he could not stay at the hotel.
Historians disagree as to whether the Seligman family were physically turned away from the hotel, told not to come to the hotel, or advised that they could stay only one final time. However, it is clear that the Seligmans were made to feel that their presence at the hotel was not desired and would not be tolerated long, if at all.
The incident created much controversy. The New York Times, on June 19, 1877, ran a headline set entirely in capital letters:
A month later, the New York Times disclosed a letter in which Judge Hilton told a friend, "As [yet] the law . . . permits a man to use his property as he pleases, and I propose exercising that blessed privilege, notwithstanding Moses and all his descendants object."
The case became a national sensation. Seligman and Hilton both received death threats. A group of Seligman's friends started a boycott against A. T. Stewart's, eventually causing the business to fail; a sale to John Wanamaker followed. This prompted Hilton to pledge a thousand dollars to Jewish charities, a gesture mocked by the satirical magazine Puck.
Hilton was also castigated by Henry Ward Beecher (who knew Seligman) in a sermon entitled "Gentile and Jew." After praising Seligman's character, Beecher said, "When I heard of the unnecessary offense that has been cast upon Mr. Seligman, I felt no other person could have been singled out that would have brought home to me the injustice more sensibly than he."
Whether or not Seligman meant to be turned away from the hotel to cast a light on growing antisemitism in America, the resulting publicity emboldened other hoteliers to exclude Jews, placing advertisements saying "Hebrews need not apply" and "Hebrews will knock vainly for admission."
Joseph Seligman's siblings were, in order of birth, William (born Wolf), James (born Jacob), Jesse (born Isaias), Henry (born Hermann), Leopold (born Lippmann), Abraham, Isaac, Babette, Rosalie, and Sarah.
He married his cousin Babet Steinhardt in a ceremony in Baiersdorf in 1848. Together, they had five sons, David, George Washington, Edwin Robert Anderson Seligman, Isaac Newton Seligman, and Alfred Lincoln, as well as four daughters, Frances, Sophie and two others.
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