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Jacob Henry Schiff was a German-born American financier and philanthropist. In many of his interests he was associated with E. H. Harriman.
Background
Jacob Henry was born on January 10, 1847 in Frankfurt-am-Main, Germany.
He was the son of Moses and Clara (Niederhofheim) Schiff, and a member of a family that could trace its line back to 1370, through scholars of distinction and men of affairs.
Education
Jacob Henry Schiff was educated in the local schools and, in addition to secular and Jewish knowledge, gained a fair acquaintance with French and English.
Career
With some difficulty, Schiff secured his father's permission to come to America, arriving in New York on August 6, 1865. For a short time he was engaged with a brokerage firm in New York, and on November 21, 1866, was licensed as a broker. In 1867 he joined the firm of Budge, Schiff & Company, which was dissolved in 1872.
Schiff meanwhile had become a citizen of the United States, being naturalized in September 1870. Upon the dissolution of his firm, he decided to go back to Germany and in the following year was offered a position as manager of the Hamburg Branch of the London & Hanseatic Bank. This connection did not last long, because Schiff returned to Frankfurt upon the death of his father in that same year.
In 1874 he was invited by Abraham Kuhn, senior partner of Kuhn, Loeb & Company, to return to New York and enter that firm. He accepted this proposal in January 1875, bringing to his new association his connections with Sir Ernest Cassel of London, with Edouard Noetzlin, president of the Banque de Paris et des Pays Bas, and with Robert Fleming, then of Dundee and later of London. Through these connections he was able to place large quantities of American securities on the European market. In 1885, at the age of thirty-eight, he became head of the firm.
Schiff was concerned with the financing of nearly all the important railroads in the East, which were not personally owned by families, especially the Pennsylvania Railroad and the Louisville & Nashville. Probably the most sensational episode in his financial career was the struggle between the Union Pacific Railroad and the Great Northern company for control of the Northern Pacific, in which Schiff was allied with Edward H. Harriman against James J. Hill and J. P. Morgan & Company. This contest brought about a panic on the stock market, May 9, 1901, and resulted in the formation later that year of the Northern Securities Company.
Schiff also took a hand in the reorganization of the Baltimore & Ohio Railroad (1896 - 99) and at various times aided the American Smelting & Refining Company, the Westinghouse Electric Company, and the Western Union Telegraph Company.
One of his less fortunate ventures was his share, under the persuasion of Thomas Fortune Ryan and William C. Whitney, in financing a reorganization (1902) of the Metropolitan Street Railway Company of New York. As soon as the Federal Reserve Act was passed he resigned his connection with the National City Bank and other banks.
He was largely concerned in the great insurance companies, particularly the Equitable Life Assurance Society, of which he was a director. This connection brought him under investigation by a joint committee of the New York legislature in 1905, but he was acquitted of all knowledge of the alleged unscrupulous practices of some of his associates. He was interested in the development of railroads and other enterprises in Mexico.
In 1904, at the time of the Russo-Japanese War, he secured for Japan some $200, 000, 000. In 1911 he supported a Chinese loan, partly as a result of the influence of a young diplomat, Willard Straight, who thought that American capital invested in the Manchurian railways might serve to prevent future wars in the Far East.
His civic interests were so well known that in 1904 he was suggested as a Republican candidate for mayor of New York, but declined to be considered. He was a member of the board of education, however, and his advice was sought by reform mayors like William R. Grace and Seth Low. In 1908 he seriously put before the Chamber of Commerce the question of a proper budget for New York City.
Schiff recognized his special obligation to the Jewish people in the matter of charities. He was always glad to help establish loan funds and, with Robert W. De Forest, was instrumental in the establishment of a National Employment Exchange. He was greatly interested in the work of the Red Cross, in 1910 was appointed by the President as a member of the International Relief Board of the American Red Cross, and served as treasurer of the New York chapter for many years.
He was president and a great benefactor of the Montefiore Hospital, to which he probably gave more personal attention than to any other single charitable institution. He was greatly interested in the establishment of free libraries in New York. He aided Columbia University, established the Semitic Museum at Harvard, built a students' hall for Barnard College in 1915 in celebration of the fiftieth anniversary of his arrival in New York, created an establishment at Cornell University for the promotion of studies in German culture, and furnished the funds for the establishment of the department of Semitic literature at the New York Public Library and a similar department at the Library of Congress in Washington.
In 1909 he created a fund which rendered possible a new translation of the Bible, under Jewish auspices, published in 1917 by the Jewish Publication Society of America, and in 1914 he created another fund which resulted in the publication of the Schiff Library of Jewish Classics, some twenty volumes in number.
He was active in the work of the American Jewish Joint Distribution Committee to relieve suffering in Europe during the World War, and in the Jewish Welfare Board, which ministered to Jewish soldiers and sailors during the same period. He was very active in the various Liberty Loan Committees.
Schiff died in New York City on September 25, 1920.
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Politics
Schiff was a strong opponent of the Silver Purchase Act of 1890 and actively supported the gold standard on all occasions. As early as 1902 he recognized that the inelasticity of the currency was a potential danger. He early accepted the right of laborers to combine for their own protection, favored arbitration in labor disputes, earnestly befriended the Henry Street Settlement and municipal charities, and supported the National Child Labor Committee. He was a Republican throughout his career, although he voted for Woodrow Wilson in both his campaigns for the presidency. He had a strong sympathy for the colored people and by his voice, his means, and his personal interest, helped to promote Tuskegee Institute and other Negro schools in the South.
His resentment toward Czaristic Russia because of Russia's treatment of the Jews was so strong that he declined to participate in the Anglo-French Dollar Loan, although it would have brought profit to his firm.
Views
Schiff always felt strongly about his connection to the Jewish people, and demonstrated this through his philanthropy.
Personality
Jacob Schiff was a reader, fond of walking and bicycling, most punctilious in all his affairs.
Quotes from others about the person
The Jewish Communal Register of New York City stated that "Mr. Schiff has always used his wealth and his influence in the best interests of his people. He financed the enemies of autocratic Russia and used his financial influence to keep Russia from the money markets of the United States. "
Connections
On May 6, 1875, Schiff married Therese Loeb, by whom he had a son and a daughter. The former, Mortimer Leo Schiff (June 5, 1877 - June 4, 1931), became a valued member of the firm and its head after the death of his father.