Popes and Bankers by Jack Cashill

Author:Jack Cashill [Cashill, Jack]
Language: eng
Format: epub
Publisher: Thomas Nelson
Published: 2018-08-02T00:00:00+00:00

eighteen Cross of Gold

THE ELECTION OF 1896 REPRESENTS THE MOST DRAMATIC PARTY REALIGNMENT in the history of American politics. The party of Jefferson, Jackson, and Grover Cleveland—hard-money men all—went soft. The transition was not an easy one. Said the party’s eventual nominee of the struggle, evoking the language of the Civil War, “Brother has been arrayed against brother, and father against son. The warmest ties of love and acquaintance and association have been disregarded.” 1

The struggle centered not on war and peace or prohibition or segregation, all potentially hot topics, but on a single issue that could be summarized in a single word: gold. The insurgent soft-money forces, America’s debtor class, were rising up in righteous indignation against their creditors, the “few financial magnates who in a backroom corner the money of the world.” 2 Standing in the way of the insurgents were the so-called Bourbon Democrats, who were alleged to do their financial masters’ bidding. What the insurgents demanded was nothing less than an abandonment of the gold standard. Said their thirty-six-year-old leader in the speech that would net him the party’s nomination, “You shall not press down upon the brow of labor this crown of thorns. You shall not crucify mankind upon a cross of gold.” 3

By this time the Republicans had already nominated William McKinley as their candidate for the presidency. But William Jennings Bryan, the “boy orator of the plains,” was savvy enough to know that he was facing a more formidable opponent than McKinley—a more formidable opponent, for that matter, than the power broker behind McKinley, Mark Hanna. No, to win, Bryan would have to best the man whose power Hanna brokered, America’s most formidable banker ever and arguably the most powerful man in the world circa 1896, John Pierpont Morgan.

The ascent of the house of Morgan gives a reassuring ecumenical coloring to the history of investment banking: they were the Protestants to the Medicis’ Catholics to the Rothschilds’ Jews. The Morgans, a term used here to include partners as well as family members, would also oversee, quite literally, the shift of the world’s financial power from London to New York. As with the Medicis and the Rothschilds, their story begins with a hardworking patriarch and reaches its ascendancy with a son.

In 1837, the year of the Panic, the year coincidentally that Pierpont was born, Baltimore merchant George Peabody (pronounced PEE-buh-dee) moved to London. Already respected in international circles, Peabody opened a merchant house and began to do business. He traded in dry goods—a catchall phrase for textiles, clothing, and the equally elusive “sundries”—and financed other trades as well. Businesses like his were known as merchant banks, the progenitors of today’s investment banks. 4 Merchant bankers dealt exclusively with institutions and what we have come to call—isn’t there a better phrase?— “high net-worth individuals.” They issued stocks and bonds, financed overseas trade, and brokered commodities among other services. Theirs was a world without teller windows or Christmas clubs or velvet rope lines in the lobby.

Not content to blend into London’s oaken woodwork, Peabody positioned himself as an American banker.

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