Joseph Seligman
Encyclopedia
Robber baron
A robber baron or robber knight was an unscrupulous and despotic nobility of the medieval period in Europe, for example, Berlichingen. It has slightly different meanings in different countries. In modern US parlance, the term is also used to describe unscrupulous industrialists...
". He was born in Baiersdorf
Baiersdorf
Baiersdorf is a town in the district of Erlangen-Höchstadt, in northern Bavaria, Germany.-Location:The major part of Baiersdorf is idyllically situated on a terrace which preserves the town from being flooded by the close Regnitz river...
, Germany
Germany
Germany , officially the Federal Republic of Germany , is a federal parliamentary republic in Europe. The country consists of 16 states while the capital and largest city is Berlin. Germany covers an area of 357,021 km2 and has a largely temperate seasonal climate...
, emigrating to the United States when he was 18. With his brothers, he started a bank, J. & W. Seligman & Co.
J. & W. Seligman & Co.
J. & W. Seligman & Co., founded in 1846, was a prominent U.S. investment bank c. 1860s–1920s until the divestiture of its investment banking arm in the aftermath of the Glass–Steagall Act. The firm was involved in the financing of several major U.S. railroads in the 1870s and the construction of...
, with branches in New York
New York
New York is a state in the Northeastern region of the United States. It is the nation's third most populous state. New York is bordered by New Jersey and Pennsylvania to the south, and by Connecticut, Massachusetts and Vermont to the east...
, San Francisco, New Orleans, London
London
London is the capital city of :England and the :United Kingdom, the largest metropolitan area in the United Kingdom, and the largest urban zone in the European Union by most measures. Located on the River Thames, London has been a major settlement for two millennia, its history going back to its...
, Paris
Paris
Paris is the capital and largest city in France, situated on the river Seine, in northern France, at the heart of the Île-de-France region...
and Frankfurt
Frankfurt
Frankfurt am Main , commonly known simply as Frankfurt, is the largest city in the German state of Hesse and the fifth-largest city in Germany, with a 2010 population of 688,249. The urban area had an estimated population of 2,300,000 in 2010...
.
In the post-Civil War Gilded Age
Gilded Age
In United States history, the Gilded Age refers to the era of rapid economic and population growth in the United States during the post–Civil War and post-Reconstruction eras of the late 19th century. The term "Gilded Age" was coined by Mark Twain and Charles Dudley Warner in their book The Gilded...
, J. & W. Seligman & Co. invested heavily in railroad finance, in particular acting as broker of transactions engineered by Jay Gould
Jay Gould
Jason "Jay" Gould was a leading American railroad developer and speculator. He has long been vilified as an archetypal robber baron, whose successes made him the ninth richest American in history. Condé Nast Portfolio ranked Gould as the 8th worst American CEO of all time...
. 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
Russia
Russia or , officially known as both Russia and the Russian Federation , is a country in northern Eurasia. It is a federal semi-presidential republic, comprising 83 federal subjects...
and Peru
Peru
Peru , officially the Republic of Peru , is a country in western South America. It is bordered on the north by Ecuador and Colombia, on the east by Brazil, on the southeast by Bolivia, on the south by Chile, and on the west by the Pacific Ocean....
, 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
Grand Union Hotel (Saratoga Springs, New York)
The Grand Union Hotel was located on Broadway in Saratoga Springs, New York. The hotel began as a boarding house, built by Gideon Putnam in 1802, but grew into the world's largest hotel, before it was demolished in 1953....
in Saratoga Springs, New York
Saratoga Springs, New York
Saratoga Springs, also known as simply Saratoga, is a city in Saratoga County, New York, United States. The population was 26,586 at the 2010 census. The name reflects the presence of mineral springs in the area. While the word "Saratoga" is known to be a corruption of a Native American name, ...
.
Childhood
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
Baiersdorf
Baiersdorf is a town in the district of Erlangen-Höchstadt, in northern Bavaria, Germany.-Location:The major part of Baiersdorf is idyllically situated on a terrace which preserves the town from being flooded by the close Regnitz river...
.
At fourteen, Seligman attended the University of Erlangen. At seventeen, he boarded a steamer at Bremen and sailed to America.
Arrival in America
Seligman initially settled in Mauch Chunk, PennsylvaniaPennsylvania
The Commonwealth of Pennsylvania is a U.S. state that is located in the Northeastern and Mid-Atlantic regions of the United States. The state borders Delaware and Maryland to the south, West Virginia to the southwest, Ohio to the west, New York and Ontario, Canada, to the north, and New Jersey to...
, where he went to work as a cashier/clerk for Asa Packer
Asa Packer
Asa Packer was an American businessman who pioneered railroad construction, was active in Pennsylvania politics, and founded Lehigh University.-Early life:...
, who later become a United States congressman
United States Congress
The United States Congress is the bicameral legislature of the federal government of the United States, consisting of the Senate and the House of Representatives. The Congress meets in the United States Capitol in Washington, D.C....
. 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.
J. & W. Seligman & Co. and railroads
Seilgman's firm made a number of investments in railroads. Among these were the Missouri Pacific, the Atlantic and Pacific RailroadAtlantic and Pacific Railroad
The Atlantic and Pacific Railroad was a U.S. railroad that owned or operated two disjoint segments, one connecting St. Louis, Missouri with Tulsa, Oklahoma, and the other connecting Albuquerque, New Mexico with Southern California. It was incorporated by the U.S. Congress in 1866 as a...
, the South Pacific Coast Railroad
South Pacific Coast Railroad
The South Pacific Coast Railroad was a narrow gauge steam railroad running between Santa Cruz, California and Alameda, with a ferry connection in Alameda to San Francisco. The railroad was created as the Santa Clara Valley Railroad, founded by local strawberry growers as a way to get their crops...
, and the Missouri-Kansas-Texas Railroad
Missouri-Kansas-Texas Railroad
The Missouri–Kansas–Texas Railroad was incorporated May 23, 1870. In its earliest days the MKT was commonly referred to as "the K-T", which was its stock exchange symbol; this common designation soon evolved into "the Katy"....
. 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.
Civil War
During the American Civil WarAmerican Civil War
The American Civil War was a civil war fought in the United States of America. In response to the election of Abraham Lincoln as President of the United States, 11 southern slave states declared their secession from the United States and formed the Confederate States of America ; the other 25...
, Seligman was responsible for aiding the Union
Union (American Civil War)
During the American Civil War, the Union was a name used to refer to the federal government of the United States, which was supported by the twenty free states and five border slave states. It was opposed by 11 southern slave states that had declared a secession to join together to form the...
by disposing of $200,000,000 in bonds "a feat which W. E. Dodd
William Dodd (ambassador)
William Edward Dodd was an American historian who served as the United States Ambassador to Germany from 1933 to 1937, during the Nazi era.-Early years and academic career:...
said was 'scarcely less important than the Battle of Gettysburg
Battle of Gettysburg
The Battle of Gettysburg , was fought July 1–3, 1863, in and around the town of Gettysburg, Pennsylvania. The battle with the largest number of casualties in the American Civil War, it is often described as the war's turning point. Union Maj. Gen. George Gordon Meade's Army of the Potomac...
.'"
Later historians have suggested that Seligman's role in financing the war through bonds has been exaggerated. According to Stephen Birmingham
Stephen Birmingham
Stephen Birmingham, born May 28, 1932 in Hartford, Connecticut, is an author.Born to Thomas Birmingham and Editha Gardner Birmingham, he received a BA from Williams College in 1953. He is a former teacher of writing at the University of Cincinnati. He has written over thirty books and is now retired...
, 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.
United States economy
President Ulysses S. GrantUlysses S. Grant
Ulysses S. Grant was the 18th President of the United States as well as military commander during the Civil War and post-war Reconstruction periods. Under Grant's command, the Union Army defeated the Confederate military and ended the Confederate States of America...
, 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
United States Secretary of the Treasury
The Secretary of the Treasury of the United States is the head of the United States Department of the Treasury, which is concerned with financial and monetary matters, and, until 2003, also with some issues of national security and defense. This position in the Federal Government of the United...
, 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
August Belmont
August Belmont, Sr. was an American politician.-Early life:August Belmont was born in Alzey, Hesse, on December 8, 1813--some sources say 1816--to Simon and Frederika Elsass Schönberg, a Jewish family. After his mother's death, when he was seven, he lived with his uncle and grandmother in Frankfurt...
, and a number of other New York bankers to come to Washington, D.C.
Washington, D.C.
Washington, D.C., formally the District of Columbia and commonly referred to as Washington, "the District", or simply D.C., is the capital of the United States. On July 16, 1790, the United States Congress approved the creation of a permanent national capital as permitted by the U.S. Constitution....
, to plan a refinancing of the war
American Civil War
The American Civil War was a civil war fought in the United States of America. In response to the election of Abraham Lincoln as President of the United States, 11 southern slave states declared their secession from the United States and formed the Confederate States of America ; the other 25...
debt. Each banker submitted a plan, but Secretary of the Treasury Sherman
John Sherman (politician)
John Sherman, nicknamed "The Ohio Icicle" , was a U.S. Representative and U.S. Senator from Ohio during the Civil War and into the late nineteenth century. He served as both Secretary of the Treasury and Secretary of State and was the principal author of the Sherman Antitrust Act...
accepted Seligman's plan as being the most practical. It involved retaining gold reserves totaling forty percent of circulating greenbacks through bond sales.
Seligman-Hilton affair
In 1877, Judge Henry Hilton, the owner of the Grand Union HotelGrand Union Hotel
Grand Union Hotel can refer to:* Grand Union Hotel , listed on the National Register of Historic Places* Grand Union Hotel , listed on the National Register of Historic Places...
in Saratoga, New York
Saratoga, New York
Saratoga is a town in Saratoga County, New York, United States. The population was 5,141 at the 2000 census. It is also the commonly used, but not official, name for the neighboring and much more populous city, Saratoga Springs. The major village in the town of Saratoga is Schuylerville which is...
, 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.
Background
During the 1870s, several incidents made Alexander StewartAlexander Turney Stewart
Alexander Turney Stewart was a successful Irish American entrepreneur who made his multi-million fortune in what was at the time the most extensive and lucrative dry goods business in the world....
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
Tammany Hall
Tammany Hall, also known as the Society of St. Tammany, the Sons of St. Tammany, or the Columbian Order, was a New York political organization founded in 1786 and incorporated on May 12, 1789 as the Tammany Society...
, the Senate declined to confirm him.
Seligman was invited to serve in the Committee of Seventy
Committee of Seventy
The Committee of Seventy is a good government group in Philadelphia, Pennsylvania, USA, founded in 1904. It is a nonpartisan organization perhaps best known for monitoring elections in the city and its suburbs. Zack Stalberg is President and Chief Executive Officer and Daniel K...
, 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
Department store
A department store is a retail establishment which satisfies a wide range of the consumer's personal and residential durable goods product needs; and at the same time offering the consumer a choice of multiple merchandise lines, at variable price points, in all product categories...
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.
The incident
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.
Aftermath
The incident created much controversy. The New York Times, on June 19, 1877, ran a headline set entirely in capital letters:-
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- A SENSATION AT SARATOGA.
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- NEW RULES FOR THE GRAND UNION.
- NO JEWS TO BE ADMITTED--MR. SELIGMAN,
- THE BANKER, AND HIS FAMILY SENT AWAY--
- HIS LETTER TO MR. HILTON--
- GATHERING OF MR. SELIGMAN'S FRIENDS
- AN INDIGNATION MEETING TO BE HELD.
- A SENSATION AT SARATOGA.
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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
John Wanamaker
John Wanamaker was a United States merchant, religious leader, civic and political figure, considered by some to be the father of modern advertising and a "pioneer in marketing." Wanamaker was born in Philadelphia, Pennsylvania.-Biography:He was born on July 11, 1838.He opened his first store in...
followed. This prompted Hilton to pledge a thousand dollars to Jewish charities, a gesture mocked by the satirical magazine Puck
Puck (magazine)
Puck was America's first successful humor magazine of colorful cartoons, caricatures and political satire of the issues of the day. It was published from 1871 until 1918.-History:...
.
Hilton was also castigated by Henry Ward Beecher
Henry Ward Beecher
Henry Ward Beecher was a prominent Congregationalist clergyman, social reformer, abolitionist, and speaker in the mid to late 19th century...
(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."
Family
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
Edwin Robert Anderson Seligman
Edwin Robert Anderson Seligman , was an American economist.-Biography:He was born in New York City, a son of Joseph Seligman, a banker. He was educated at Columbia University, where he graduated in 1879...
, Isaac Newton Seligman
Isaac Newton Seligman
Isaac Newton Seligman was an American banker and communal worker.-Early life:Seligman attended Columbia Grammar School and Columbia College, from which he graduated in 1876...
, and Alfred Lincoln, as well as four daughters, Frances, Sophie and two others.