Berlin

As the capital, Berlin got a large share of the new riches. Suddenly the city was awash in investment funds, which attracted all sorts of entrepreneurial types with ideas for putting the money to work. As the Volks-Zeitung reported in 1873, hardly a week went by without a new company, factory, or bank being established. Between 1871 and 1872, 780 new companies were set up in Prussia, most of them in Berlin. Germany’s greatest banks—the Deutsche, Dresdener, and Darmstadter—made their headquarters there. So did the country’s newspaper industry. Rudolf Mosse launched his Berliner Tageblatt in 1871 with the following characteristic comment: “At a time when the eyes of the world look toward Berlin, we present to the public the Berliner Tageblatt. The capital of Prussia has become the capital of Germany, a world city. . . . We must be inspired by the thought that he who writes for Berlin 12 writes for the civilized world.”

To make their enterprises more attractive to first-time investors, Berlin entrepreneurs studded their boards of directors with aristocratic names. As a company founder explains in Friedrich Spielhagen’s novel Sturmflut: “We absolutely need a high aristocratic name. You don’t understand our insular patriotism. A Judas goat must go ahead, but then, I tell you, the whole herd will follow. Therefore, a kingdom for a Judas goat!” Bedazzled by titled goats, the herd followed along, and an amazingly inclusive and democratic herd it was, embracing, as one Berliner recalled, “the shrewd capitalist and the inexperienced petty bourgeois, the general and the waiter, the woman of the world, the poor piano teacher and the market woman.” All found a new place to worship in Berlin’s palatial stock market building on the Neue Friedrichstrasse, an “Everyman’s Temple of Temptation.”

Among the promoters of Berlin’s new wealth could be found a significant number of Jews, who took advantage of the liberalized business climate and full legal rights they achieved with unification to stake out prominent positions in certain branches of the economy. They were particularly prominent in the rise of the department store (the key names here being Wertheim, Tietz, and Israel), the publishing business (Mosse and Ullstein), the stock market, and banking. Jewish families had long been prominent in Prussia’s and Berlin’s banking scene; in 1808 one-third of Berlin’s thirty banks were Jewish-owned, and by 1860 there were twice as many Jewish as non-Jewish banks in Prussia. After unification, Jews controlled about 40 percent of all banks in the Reich, while another one-third were of mixed Jewish and Christian ownership; only one-quarter were in exclusively Christian hands. This phenomenon hardly went unnoticed, and it excited age-old prejudices. Observing the bustling scene around the stock market, one commentator sneered: “Here, too, the Jewish element—no longer restrained, as of old, within particular limits, and today so insolently dominant in Berlin—exercises a continually increasing influence.”

Particularly influential was Gerson Bleichröder, Bismarck’s personal banker and financial adviser. Bleichröder’s father, the son of a gravedigger, had managed to become the Berlin agent of the powerful Rothschild banking dynasty, thereby building a potent banking business of his own. Continuing to exploit the Rothschild connection, and making the most of his ties to Bismarck, Gerson Bleichröder became one of the wealthiest men in the Reich, maintaining a magnificent mansion in the Behrenstrasse and a country estate where he hosted parties that were “great events, Lucullan feasts.” While enriching himself he also worked wonders for the financial portfolio of his most illustrious client. (Despite, and partly because of, his vast land holdings, Bismarck was low on capital at the time of German unification; it was up to Bleichröder to make him “a respectable prince.”) Bismarck rewarded his banker with useful political tips, access to power, and the first hereditary title awarded a Jew in the new Reich, yet he also told anti-Semitic jokes about him behind his back, as if half-embarrassed by the riches his Privatjude had earned him. Bleichröder’s story is a kind of morality tale of Bismarckian Berlin. It exemplified (in the words of historian Fritz Stern) “the precariousness of the German plutocracy: they huddled after wealth and status—and discovered that the former did not confer the latter. . . . Berlin was full of plutocratic parvenus; it was full, too, of Jews who were the pariahs among plutocratic parvenus.”