Haym Salomon – Financier of the Revolution

 The earliest constitution of several New England colonies were framed upon the model of the Mosaic code as a guide, and the preachers, who were the progressives and radicals of their day, constantly drew their civil creed from the history of those times and held up the old Hebrew commonwealth as a model for our government.

     Dr. Samuel Langdon, President of Harvard College, one of the most influential men of his period, in his election sermon before the “Honorable Congress of Massachusetts Bay,” May 3^rd, 1775, held up, “The Republic of the Israelites as an Example to American States.”

     Dr. George Duffield in the Third Presbyterian Church of Philadelphia, with John Adams as a listener, drew a parallel between George III and Pharaoh.

     Dr. Ezra Stiles preached a sermon on, “The United States Elevated to Glory and Honor,” in which he set forth the Hebrew Commonwealth as the model for the new republic.  This was true of all the great preachers of that day.

     It is therefore not surprising that when a committee was appointed on the day the Declaration of Independence was adopted, consisting of Franklin, Adams and Jefferson, to prepare a device for a seal for the United States, how perfectly natural that they should, as they did propose as such, Pharaoh sitting in an open chariot, a crown on his head and a sword in his hand, passing through the dividing waters of the Red Sea in pursuit of the Israelites, with rays from a pillar of fire, beaming on Moses, who is represented as standing on the shore extending his hand over the sea, causing it to overwhelm Pharaoh and underneath the motto:

“Rebellion to Tyrants is Obedience to God.”

 President Taft on Haym Salomon

Address given in Washington, D.C.

     It is a great pleasure for me to be here tonight and to hear the eloquent tribute of the orator, Dr. Peters, to what the Jew has done in American history…

     Under the influence of my father, who was the broadest man I ever knew, I came to feel that the Jews were a very important part, as they were, of the citizenship of Cincinnati.

     And as I attended the public schools, and was prepared for college there, I had occasion to note what Dr. Peters has commented on, that there were some young men and women with “stein” at the end of their names who were always among the first in the class.  Everyone who lives in a community like that of my home city of Cincinnati knows that none of the great charities, none of the theatres, none of the societies for art, artistic development, or music, could live if it were not for the supports of the Jews.

     I believe it to be true, as Dr. Peters says, that the Jews are not very rich, but they are all engaged in making as good a living as they can, and in supporting their families as comfortably as they can, and in upholding the home and the domestic circle as they most important things to be upheld and supported.  And so it is that they are a most important part of every community.

     It is pathetic almost to see the Jews of the East Side, who come from Russia and elsewhere, seize and enjoy and appreciate the opportunities that are given in this government for education.  I have been there to see the energy and the sincerity with which they respond to every patriotic sentiment, feeling, as they do, gratitude to the flag under which they enjoy the educational and other privileges that this government affords.

     I believe, land I am proud of the fact, that the Jews in America enjoy an equality that they have in only a few other countries of the world.  I don’t mean to say that there are not racial prejudices here; I don’t mean to say that there are not social clubs and other places where the small-headed men who occasionally get into a directory manifest their greatness by using a blackball and shutting out men of importance in the community; but, my friends, while it is aggravating and exasperating, still it is not the worst thing that could happen.  I have had it happen to friends of mine – Gentiles – who have been kept out of clubs by people who are not worthy to button up their shoes, and who have no standing save in clubs.  It is aggravating, I agree, but a man is what he is by reason of his respect for himself, and if he knows that some one who affects to snub him and look down upon him is not worthy – if he knows that that person is not his equal and he cultivates any of the philosophy that he ought to call to his aid – he will have the advantage over his small-brained and narrow-minded critic always.

     I did not come here to make a speech.  I came here to second the motion for a memorial to the Jew who stood by Robert Morris and financed the revolution, the friend of Kosciuszko and of Pulaski, both of whom have monuments here – a man who apparently gave all he had, for he had nothing when he died – or at least there was nothing except what he ought to have collected and did not – a man thrown into prison as a spy under Clinton, and who escaped because he could talk ten different languages, and because somebody who had custody of him thought he would be more useful to him as a live interpreter than as a dead man.  He subsequently escaped and devoted his entire time and fortune to helping along the cause of the revolution.

     It is most interesting to read those letters, to which Dr. Peters has referred, in which Madison speaks of the strapped condition in which he was while he was trying to help out the country as a member of the Congress, and his constant application to his friend Salomon until he became ashamed to go to him, because Salomon would not charge him any interest.  Salomon must have had a pretty heavy load to carry in looking after all those Congressmen, but they were necessary to this country, and he knew it.  It is not the man only who wears the uniform and carries a gun or a sword and has epaulets that is necessary to effect a successful revolution.

     Money is the sinews of war, and the necessity for money impresses itself as the fight goes on, and you will observe that Haym Salomon was most active during these later years, when the strain grew harder in the fight and when people were likely, because of the long struggle, to become tired out and to lose their patriotic interest.  Then it was that he negotiated these large loans; then it was that he helped his impecunious associates, and then it was that he entitled himself to the gratitude of the entire country.  If there should be erected a memorial to him in Washington to testify to his disinterested self-sacrifice in behalf of his country if would be most appropriate.

Haym Salomon

     Haym Salomon was born at Lissa, Poland, in 1740, of Jewish-Portuguese descent, and it is probable that he left his native country after the partition of Poland in 1772.

     Salomon’s family were highly respectable and learned people.  He enjoyed the friendships of Kosciuszko and Pulaski, the noble patriots who unsheathed their swords for human liberty.

     With his own unhappy country’s history and with his hatred of despotic Russia, Salomon imbibed a love of liberty which extensive travel in Europe intensified, and, as might have been expected, the outbreak of the Revolution found him an ardent supporter of the Colonial cause.

     He settled in New York and there married Rachel, daughter of Moses B. Franks, of London, who, as well as his brother, the distinguished Jacob Franks of the Revolutionary war, died in New York while it was yet a colony.  Rachel Franks was the sister of Colonel Isaac Franks, a Revolutionary officer of distinction, and of Mayer Isaac Franks, a judge of the Supreme Court of Pennsylvania.

     Moses and Jacob Franks were sons of Adam Franks, of Germany, the friend of King George of Hanover and who loaned that monarch the most valuable jewels in his crown at the coronation.

     Jacob Franks was the British King’s sole agent for the Northern Colonies at New York, and his son David was the British King’s agent for Pennsylvania.

     When the Revolutionary war began, Salomon identified himself with the American cause and was arrested and imprisoned as a spy soon after the occupation of New York by the British in 1776.  Salomon was closely confined for a long time in the prison known as “the Provost,” which stood on the spot now occupied by the old Hall of records in the City Hall Park.  So closely were the prisoners packed there that when they “laid down at night to rest, when their bones ached, on the hard oak planks, and they wished to turn, it was altogether by command, ‘right – left,’ being so wedged as to form almost a solid mass of solid bodies.”

     When Salomon’s linguistic proficiency became known (he knew Polish, French, German, Russian, Spanish and Italian), he was turned over to the Hessian general, Heister, who gave him an appointment in the commissariat department, where his greater liberty enabled him to render much service to the French and American prisoners, many of whom he helped to escape.  He created dissension among the Hessian officers, prompting many to resign from the service.

     In 1778, he was taken by the British general, Sir H. Clinton, on charges that he had received orders from Washington to burn fleets and destroy their warehouses, “which he had attempted to execute to their great damage and injury.”

     He was imprisoned, tortured, and condemned to a military death, but on August ll, 1778, he managed to escape, by compensating his jailor, leaving behind him in New York six thousand pounds sterling, a distressed wife, and child one month old.  It seems likely that his intimate friend, the brave General McDougall, who then commanded the American army in the neighborhood of New York, was in co-operation with him.  Fourteen days later Salomon addressed a petition to the Continental Congress. Setting forth his services and asking for some employment; but, characteristic of the man, he asked not for himself alone, at the same time he entered a plea for the exchange of Samuel Demezes, a fellow prisoner.

     Congress turned a deaf ear to his plea and the denial worked for the ultimate good both of Salomon and the young country.

     The tide in his affairs, and as the story shows, the tide in the affairs of the young Republic, turned upon his escape to Philadelphia, and it was not long until he succeeded in establishing himself in business, and there becoming one of the greatest financiers of his adopted city.

     Salomon’s matchless enterprise, eminent respectability, remarkable intelligence, irreproachable integrity, his delicate sense of mercantile honor, his unbounded benevolence for all mankind, and, above all, his undying hatred of tyranny, soon led to his recognition by the leading men of his time, and the uncompromising, implacable foe to British dominion was brought into intimate relationships with the Revolutionary patriots.

     Early in 1781, he made known through the newspapers that he was a dealer in bills of exchange on France and Holland.  For the most part the money advanced by Louis XVI and the proceeds of the loans negotiated in Holland passed through his hands.  He was entrusted with the negotiation of all the war subsidies of France and Holland on his own personal integrity, which were sold to the resident merchants in America without any loss, at a credit of two and three months, for which he received the small commission of one-fourth of one per cent.  Several European financial houses did business through him.  A few days after the foregoing announcement, Robert Morris became Superintendent of Finance.  Morris’ diary records not less than seventy-five financial transactions with Salomon, between August 1781, and April 1784.

     Alexander Hamilton, writing during the dark days of the war to Robert Morris, says: “It is by restoring public credit, not be gaining battles, that we are finally to gain our object.”  Haym Salomon brought not only all his wealth to the aid of his adopted country, but a financial insight which, for clearness and depth, was not surpassed by Alexander Hamilton nor equaled by Robert Morris.  America found in Haym Salomon a champion equaled by few, his fertility in resource and soundness of financial views made him, through Robert Morris, Superintendent of Finance, the real financier of the Revolution and judged by Alexander Hamilton’s standard of patriotism, surpassed by none, for Haym Salomon was practically the sole agent employed by Morris for negotiating bills of exchange, by which means the credit of the Government was so largely maintained during this period.  We do not wish to detract from the glory of Robert Morris, but we do insist that the success Morris obtained in his financial schemes was due to the skill, ability and sacrifice of Haym Salomon.

     On July 12, 1782, he requested Morris’ permission to publish the fact that he was broker to the Office of Finance.  In reference to this Morris entered into his diary:  “This broker has been useful to the public interests…I have consented, as I do not see that any disadvantage can possibly arise to the public service, but the reverse.”

     He was appointed broker to the French consul and the treasurer of the French army and fiscal agent of the French Minister to the United States, Chevalier de la Luzerne, enormous sums passing through his hands.  He was the principal depositor of the Bank of North America, an institution founded through the instrumentality of Robert Morris, to serve as a means of obtaining funds to carry on the Government, the first and only bank chartered by the Revolutionary Congress.  The accounts of fifteen other merchants who commenced with the opening of the bank occupied, in all, fifteen pages, up to the period of Salomon’s death, while Salomon’s account occupied in all fifteen pages, double columns, of the same ledger.  Salomon’s one account was as large as their entire account in the aggregate.  The balances at the various times of settlement in his bank book show special balances of from $15.000 to $50,000 at each period.  The amount charged by the bank to his account as paid to Robert Morris was over $200,000, while Robert Morris’ own account during the same period had a deposit of less than $l0,000.  A further interesting fact is that on a day when Robert Morris deposited $l0,000 in the bank, he received exactly the same amount from Haym Salomon.

     Morris’ diary, August 26, 1782, records:  “I sent for Salomon and desired him to try every way he could to raise money.”  Two days later he wrote: “Salomon, the broker, came and I urged him to leave no stone unturned to find out money and the means by which I can obtain it.”

     Not only did Salomon Advance large sums to the Government for which he received no return, but the services of James Madison, Edmund Randolph, Generals Mifflin, St. Clair and others were retained in the cause through his bounty.  In Madison’s letter to Virginia, in 1781, he writes:  “My wants are so urgent that it is impossible to suppress them.  The case of my brethren is equally alarming.”  Later he declares:  “The kindness of our friend in Front Street (Mr. Salomon) is a fund that will preserve me from extreme necessities, but I never resort to it without great mortification, as he obstinately rejects all recompense.  To necessitous delegates he gratuitously spares from his private stock.”

     Henry Wheaton says:  “Judge Wilson, so distinguished for his labors in the Convention that framed the Federal Constitution, would have retired from public service had he not been sustained by the timely aid of Haym Salomon, as delicately as it was generously administered.”

     When Salomon was called on to advance the entire pay for the ensuing year to Jones, Randolph, and Madison, as members of the Revolutionary Congress, they had in writing allotted that Madison should get fifty pounds less than the other two, but Salomon, seeing in young Madison, then only twenty-nine years old, those great talents for which he became distinguished in after years, presented him, from his own private purse, the fifty pounds, thus equalizing the pay of the whole delegation.

     Jared Sparks in his life of Gouverneur Morris, a member of Congress in 1780, publishes a letter written by Mr. Morris, in which he declares that “the person who did loan cash to a member to relieve his distress in that day, was in no expectation of ever getting repaid.”

     James Madison, twice President of the United States, the most learned and patriotic member of the Revolutionary Congress, thus paid his tribute to Salomon’s devotion and bounty: “When any member was in need, all that was necessary was to call upon Salomon.”  Again and again he refers to his “little friend in Front Street,” acknowledged not only his indebtedness to “the little Jew” on those bounty he had pensioned, but again and again refers to his integrity and disinterestedness.

     It is true that there were merchants who subscribed to make up army supplies in 1780, ostensibly without security, but Madison’s journal shows that they had a contingent security of the best Sterling Exchange to the amount of 150,000 pounds in excess of their subscription.

     Not only did Salomon aid his home government, but he was the confidential friend and adviser of agents, consuls and representatives of foreign powers in sympathy with the Revolutionary movement.  He had confidential relations with all the foreign representatives at one time or another.  He was the confidential friend of that ardent adherent to the American cause, Count de la Luzerne, Ambassador for France.  With this appointment, Salomon was made banker for that Government.  He was appointed by Monsieur Roquebrune, treasurer of the forces of France in America and made paymaster-general, which office he filled free of charge.  A letter from count Vergennes, Minister of Spain, to de la Luzerne, states that in two years 150,000 livres (equal to present-day francs) were distributed through Salomon.

     Salomon for two years, up to the time of his death, out of his own private purse maintained Don Francisco Rendon, Ambassador from Spain.  Writing to the Spanish Governor of Cuba, Rendon says:  “Mr. Salomon has obtained money for his Majesty and I am indebted to his friendship in this particular for the support of my character, as his Majesty’s agent here, with any degree of credit and reputation, and without it I would not have been able to give that protection and assistance to His Majesty’s subjects which His Majesty enjoins and my duty requires.”  More than $10,000 was thus advanced which was never repaid.

     The secret support of Charles III of Spain is said to have been due to Salomon’s efforts.  Although Salomon endorsed a great portion of the bills of exchange for the amount of loans and subsidies our Government obtained in Europe, of which he negotiated the entire sums and the execution of which duty required a great deal of his valuable time, from 1781 to 1783, still there was only charged a fractional percentage to the United States.  He never caused the loss to the Government one cent of the many millions of his negotiations, either by his own management or from the credit he gave to others on the sale he made of those immense sums of foreign drafts on account of the United States.

     After the peace of 1783, when foreign commerce could again float unmolested, Salomon engaged as a trading merchant to European ports.  He had several ships upon the sea, but through the failure of merchants in whom he had confidence, he suffered great losses.

     Always eager to help his fellowmen, he gave every assistance possible to those who commenced trading after the war.  To the president of the National Bank, whose partner was the Superintendent of Finance, he gave two loans of $40,000 and $24,000, and without interest.  The firm was known as Willling, Morris & Swanick.  It is doubtful if he ever got any of his money back.

     So successful had Salomon become that he opened up an establishment in New York.  In the Pennsylvania and Weekly Advertiser, January 1, 1785, appeared the following announcement:

     “Haym Salomon, broker to the Office of Finance, having provided a license
     of exercising the employment of an auctioneer in the City of New York, has
     now opened for the reception of every species of merchandise, his house, No.
     22 Wall Street, and every branch of business, which in the smallest degree
     appertains to the profession – factor, auctioneer and broker, will be transacted
     in it, with that fidelity, dispatch and punctuality which has hitherto character-
     ized his dealings.  The house, in point of convenience and situation, is exceed-
     ingly well calculated for the different kinds of business above-mentioned, and
     he thinks it is almost unnecessary to assure those who favour him with their
     orders that the strictest attention shall be paid to them and the utmost care and
     solicitation employed to promote their interests.  The nature of his business enables
     him to make remittances to any part of the world with peculiar facility, and this he
     hopes will operate considerably in his favor with those who live at a distance.

         “A desire of being more extensively useful and of giving universal satisfaction
     to the public are among his principal motives for opening the house and shall be
     the great leading principles of his transactions.  By being broker to the Office of
     Finance and honored with its confidence, all those sums have passed through his
     Hands, which the generosity of the French Monarch, and the affection of the
     Merchants of the United Provinces, prompted them to furnish us with, to enable
     us to support the expenses of the war and which have so much contributed to its
     success and happy termination.  This is a circumstance which has established his
     credit and reputation, and procured him the confidence of the public, a confidence
     which it shall be his study and ambition to merit and increase, by sacredly performing
     all his engagements.  The business will be conducted upon the most liberal and ex-
     tensive plan, under the firm name of Haym Salomon and Jacob Mordecai.”