Family bankers and the rise of the robber barons
- CaroleB
- Oct 6, 2024
- 23 min read
The Gilded Age
(late 19th century in the US)
The robber barons
Who were they?
At the end of the 19th century in the US, there were a handful of men who ruled business and the whole economy with their brilliance and blind ambition.
They knew no bounds, recognized no authority but their own.
The term was generally applied to these businessmen who resorted to exploitative practices to amass their wealth, including exercising control over natural resources, influencing the upper echelons of government, paying living wages, crushing competition by acquiring their competitors in order to create monopolies and raise prices, and arranging the sale of shares at inflated prices to unsuspecting investors.
1904: representation of an acquisitive and manipulative commercial enterprise (Standard Oil) as an all-powerful octopus.
These people were called "robber barons" by their critics and "industrial titans" by their admirers.
In reality, they were the ones who introduced the first stage of modern industrial capitalism.
An enormous number of the big US corporations that are still a major part of American life today were created in the late 19th century by most of them.
They were very aggressive, often very ruthless individual entrepreneurs and their rapid achievements are still seen as extraordinary today.
They transformed the American economy but they also did so very often in a very brutal and harsh way which is what led them to be called robber barons.
How did this term appear?
This pejorative term both refers to criminal ("robber") and illegitimate aristocracy (a baron is an illegitimate role in a republic).
The term robber baron derives from the Raubritter (robber knights), medieval German lords who charged nominally illegal tolls (unauthorized by the Holy Roman Emperor) on the primitive roads crossing their lands, or larger tolls along the Rhine river. Some of the most notorious of these made a career out of highway robbery and brigandry.
The metaphor "robber barons" appeared as early as February 9, 1859, when The New York Times used it to characterize the business practices of Cornelius Vanderbilt. Historian T.J. Stiles says the metaphor "conjures up visions of titanic monopolists who crushed competitors, rigged markets, and corrupted government. In their greed and power, legend has it, they held sway over a helpless democracy."
In his 1934 book "The Robber Barons: The Great American Capitalists 1861-1901", Matthew Josephson argues that the so-called "robber barons" have a complex legacy in the history of American economic and social life. In the original foreword to the book, he claims that the robber barons:
"more or less knowingly played the leading roles in the era of the industrial revolution. Even their quarrels, intrigues, and misadventures (too often seen as purely entertaining or picturesque) are part of the mechanics of our story. Under their hands, the renewal of our economic life has continued unabated: large-scale production has replaced the dispersed and decentralized mode of production; Industrial enterprises have become more concentrated, technically "efficient" and essentially "cooperative", whereas they were previously purely individualistic and miserably wasteful. But all these revolutionary efforts were marked by the seal of private profit on the part of the new captains of industry. To organize and exploit the resources of a nation on a gigantic scale, to regiment its farmers and workers into a harmonious body of producers, and to do so solely in the name of an uncontrolled appetite for private profit—this is certainly the great inherent contradiction from which so many disasters, outrages, and misery have arisen."
This term of "robber barons" spread out following the publication of this book. According to Josephson, like the German princes of the Middle Ages, America's great businessmen had amassed huge fortunes in an immoral, unethical, and unjust manner. This theme was popular during the Great Depression of the 1930s, when the public often expressed contempt for big businesses.
Presentation of some of these robber barons
Cornelius Vanderbilt
Cornelius Vanderbilt I (May 27, 1794 – January 4, 1877) was an American entrepreneur and businessman who built his fortune in shipbuilding and railroads.
At his death, his fortune was estimated at $105 million, or at the time 1/87th of the American GDP. According to the financial blog "Celebrity Networth", Cornelius Vanderbilt is the 10th richest man of all time.
Denounced by Senator James W. Grimes as "the most blameworthy of war profiteers", he was never prosecuted. He himself retorted to the senator: "The law! But I don't give a damn about the law! I have the power, don't I? »
He was described by journalists and academics Frank Browning and John Gerassi, specialists in crime in the United States, as an "arrogant, secretive, furiously selfish and superstitious megalomaniac, always surrounded by a court of clairvoyants, spiritualists and mediums".
Edward Henry Harriman
In the second half of the 19th century, the United States was in the midst of an industrial explosion, which created a lot of opportunities. This allowed the foundation of the infrastructure on which this great country would be built, later becoming the world's greatest power.
What made it possible to create this infrastructure was the railway network that was starting to be built everywhere. A little-known man took advantage of the situation to rise to a position that many had dreamed of until then. That man was Edward Henry Harriman. He had made his fortune in the New York market, where he had met some interesting people.
"Due to his family's finances, he had to leave school at the age of 14 and take a job as an errand boy on Wall Street in New York City. His ascent from this humble position was meteoric. By the time he was 22, he was a member of the New York Stock Exchange. And, at 33, he has focused his goal on acquiring railway lines. "
He was able to acquire railway lines thanks to the help of European bankers who had lent him astronomical sums. American banks did not yet have the shoulders for this kind of loan. His investment paid off as he became one of the richest men in the world, with a fortune that exceeded that of many countries in the world. This wealth gave it the power and authority to eliminate competition, and to establish a monopoly disguised behind corporations that had different names, but the same owner.
Andrew Carnegie
He was not born with the proverbial silver spoon in his mouth.
Carnegie was a genuinely self-made man from his immigrant father, an impoverished Scottish weaver. Young Carnegie learnt both the value of a dollar and the importance of social justice.
Working as a railroad official, Carnegie grasped a simple idea better than anyone else: you can't build railroads without rails so he invested in iron, eventually controlling the whole industry and when iron gave way to steel, he dominated that industry too.
There was tremendous resentment of the way the wealthy used their wealth and that was one reason why people like Andrew Carnegie were such conspicuous philanthropists. They were concerned that the wealthy class was going to become a target of national anger if they didn't legitimize themselves in some way in the eyes of the nation.
He then created one of the largest American steel mills in Pittsburgh, between the Civil War and the beginning of the 20th century. The success of his company, the Carnegie Steel Company, was largely due to its ability to produce railroad rails in large quantities and at low prices, which were in high demand at the time.
In 1901, for the sum of $480 million, he sold his industrial properties to a group of financiers led by J. P. Morgan (see below), which was a record at the time for a commercial sale. He was nicknamed "the richest man in the world" and became the perfect embodiment of the American dream.
To launch his first steel mill in Pittsburgh, he had to borrow a large sum from European bankers, for the same reasons as E.H. Harriman. Carnegie was also one of the richest men in the world, with a fortune that exceeded that of many countries in the world. This allowed him to eliminate competition, and to establish a barely disguised monopoly.
John D Rockerfeller
At the time, there were new sources of oil that were being discovered almost every day in the United States. The technological evolution linked to oil created a gigantic opportunity and the railway network, which was improving every day, solved the problem of transport. John D. Rockefeller was the one who would seize this opportunity with the help of European bankers.
"The first billionaire of the contemporary era, he is part of the American myth of the self-made men".
Rockefeller decided to proceed by horizontal integration by putting pressure on competing refineries to buy them out. In 1872, what would later be called "the conquest of Cleveland" took place: Standard Oil absorbed 22 of its 26 competitors in Cleveland in less than two months. He then went to Pittsburgh, Philadelphia, New York, soon owning all the major refineries.
When moral values disappear, money gives power and power gives money... It is not for nothing that he became the first billionaire in the world (outside of Royalty). This gave him power and authority to establish a monopoly on the oil industry.
JP Morgan
He was one of the most powerful of these robber barons.
He mostly financed the American railroads but his origins are hardly humble. His father was a rich international banker.
He got a big boost from the Civil War where he saw the conflict as a business opportunity and he largely profited.
He ended up controlling four of the six major railroads in the country, banks, insurance companies, industrial corporations etc.
His financial empire was worth billions.
Initially focused on banking, Morgan's empire gradually expanded into many other areas such as electricity, steel, railways and shipping. In the latter field, he was the founder of the International Mercantile Marine Company, a shipping company bringing together a number of American companies, but also British companies (notably the White Star Line). As such, Morgan was the de-facto owner of the Titanic, which sank a year before his death.
He was also among the richest people in the world, who had greater wealth than many States at the time.
He was so wealthy that the US Governement asked him for help in 1907:
"With the confidence of European investors, JPM was emboldened by a dangerous niche: the financing of the railways. This will be the source of its power and the testing ground of the "morganization". Between 1870 and 1890, investment in railroads jumped from $2.5 billion to $10 billion, nearly twice the amount of capital consumed by the entire American industry. Throughout his life, JPM never ceased to push the companies to regroup, which were engaged in deadly tariff fights among themselves.
The most illustrative episode of Pierpont Morgan's immense influence took place at the time of the crash of 1907. In the absence of a central bank, it will play, at the request of the political power, the role of lender of last resort to curb the panic caused by the bankruptcy of several trusts. Already in 1895, President Cleveland had relied on the House of Morgan, helped by the Rothschilds, to save the gold standard system on which the financing of the young American economy was based. In 1907, JPM used the strong way: locking up the country's greatest financiers in the magnificent private library he had built next to his house, in order to store his unique collection of old books (he owned three of the forty-nine Gutenberg Bibles in circulation). After telling them theatrically that he would not reopen the doors until an agreement was reached, he retired to an adjacent room, rejecting most of the proposals made to him. In the early morning, he handed them a sheet of paper with the amount they were going to pledge to give and a pen, matching his finger gesture with this simple comment: "Here's the place, here's the pen."
Les Echos – 1999
The New York Times of October 26, 1907, noted of J.P. Morgan's actions during the Panic of 1907:
"In a conversation with the New York Times correspondent, Lord [Nathaniel] Rothschild paid tribute to J.P. Morgan for his efforts in the current financial environment in New York. He is worthy of his reputation as a great financier and a man of prodigies. His last action fills us with admiration and respect for him."
New York Times – 26/10/1907
Despite his reputation as an extremely wealthy and powerful man, J.P. Morgan did not leave one of America's largest fortunes when he died in 1913. It was first estimated at $75 million, then $50 million, only to reveal that there were only $19 million worth of securities in the entire estate, of which $7 million was owed to art dealer Duveen. J.P. Morgan Jr. (known to a few close friends as Jack) was embarrassed that he had to sell many of his father's art treasures to pay off the estate's debts. Most of the colossal sums handled by J.P. Morgan went directly to the Rothschilds.
In 1905, the New York Times noted in its obituary that Baron Alphonse de Rothschild owned some $60 million in U.S. securities, although the Rothschilds, according to most financial authorities, were never active in U.S. finance.
Their business practices
General presentation
Robber barons have transformed the US into a corporate giant and made it become a world power in oil, steel, finance and communications.
Modern America was willingly supplied by immigrants: first Irish, Chinese, Scandinavian and German then Jewish, Russian, Italian, Greek, Polish and Lithuanian.
Some were escaping the tyranny of prejudice, most the tyranny of poverty.
25 million people have touched the US shores between 1865 and 1914 - most at New York's Ellis Island. Many arrived eager to build new lives and raise families.
These immigrants - men, women and children - went to work in the factories of such stained
cities like New York and Boston. They came looking for freedom and opportunity and they were ready to sweat for it. The hours were long, the conditions bleak so some newcomers challenged the owners to improve things.
The Gilded Age marked the fact that politicians soon weren't going to be the power players anymore. They got replaced instead by the "robber barons". They were going to become the true power in the US.
Some people say they were only a dozen or so. But some others say that they were a couple thousands.
Essentially, most of the wealth in the United States was going to go to this handful of people.
And the only reason they were so wealthy was because they owned property or they had businesses. They weren't working.
Farmers had to work their land etc but these robber barons, they were just sitting there collecting money for owning things, not collecting money for doing things.
This was the impression that a lot of people got from these robber barons. Basically they were wealthy people who made money not because they necessarily did things better than some others but because they were first into an industry or because they had the money to invest into this industry.
These robber barons were essentially people who got into a position where they were able to manipulate the capitalist system like it had never been manipulated before.
In 1776, the Declaration of Independence was signed. At the time, most americans were making their own stuff. They were growing their own food, they were making their own furniture, they were selling their own clothes, raising their own cows for meat etc.
This started to change in the early 1800s were a market economy started to emerge. American farmers instead of growing different products on the same croft (apples over here, wheat over here, corn over here, cows over there...), they started to focus on a specific crop, growing that crop and then selling the surplus at the market and finally using these goods to take care of their daily needs such as buying their other food, clothing, furniture...
Factories and business owners started to appear. People started to work for a wage and use their wage to buy whatever they'd need to live. But at the time, these were only regional markets as the transportation costs were too high.
But after the Civil War, railroads started to be spreading out and it started to connect the United States like it had never been connected before and what happened as instance is that a shoemaker in Boston could suddenly sell in Charleston in South Carolina etc. And they started to compete with the shoemakers in Charleston. So this was the end of a regional economy.
Technology innovation railroads started to connect the economy of the United States and the emerging robber barons took advantage of these new loopholes - these new technologies - to gain a market share to where they drove others out of competition and
basically they controlled all of certain industries throughout the United States.
And once they got to this market share, they could do whatever they wanted to consumers, charge whatever they wanted, treat workers however they wanted etc.
The whole of the United States had to kneel to them as if they were Royalty. Whereas in reality, they were just entrepreneurs or businessmen sitting around.
These guys came up with a way to manipulate the system. Everybody ended up owing them something. And not necessarily because they were producing better things but because they manipulated things better than their predecessors.
Monopoly
By controlling so many industries, they consequently started to create a monopoly.
A monopoly is basically driving out of business competitors in an industry - to the point where you control almost all of this specific business. Be it shirts, shoes, copper or even oil etc... And if anybody wants to get this product they've got to go through the ones you control the industry.
And you can have local monopolies but you can also have broader monopolies. It got so dangerous today that these monopolies are worldwide:
During the Gilded Age, one of the most important monopoly was the geographical monopoly which was basically to control all of the resources in just a specific area. One of the new types of geographical monopolies at that time were railroads.
A lot of farmers had spread out to acquire new land particularly in the West and this movement expanded with the development of the railroad.
Before this, they'd only want to buy land along a river because this was the only way to get their goods to the market but as railroads started to spread out, they didnt need anymore to be by a river to get their crops to the market.
Farmers started to be spreading out along railroads, building their homesteads, improving their homesteads, tilling the land, bringing their crops to market etc.
Railroad owners started to realize that they could charge whatever they'd want to bring their crops to market as the farmer had no other option. There was no river around, there was no automobile yet. So they decided to charge a high fee and this turned into a huge problem for farmers because it essentially ended up to take most of their profits.
These big businesses were using vertical and horizontal integration.
Vertical integration is when somebody buys every step in a production process. Let's say you want to make a shirt and you want to make this shirt cheaper than anybody else, well what you can do is that you can buy the cotton farms that will produce it, you can then buy the railroads that will ship it to the factory, you can then buy the factory, you can buy the dye that you'll use for the wool, you can buy the machines that you'll use to produce the cloth and then maybe you can even buy the store that will sells the clothes and because you do this you don't have to deal with any middlemen who'd be going to be taking a cut of the profit. So when your shirt gets to the market, it's going to sell cheaper than your competitors who has to deal with the cotton farmer, with the railroads to ship it etc.
The one that's going to be bigger during this Gilded Age is horizontal integration. This means that certain guys take over specific industries and these raw materials will be needed in multiple industries. As instance, steel can be used for a lot of different things - a lot of different things require steel. The same can be said for oil, copper etc.
So some wealthy businessemen came in and basically put out of business their competitors and they decided to sort of occupy this rung to a point where if you want to do business in the United States or you want to do business, you'd need to go through them.
Example of John D Rockefeller
He is one of the individual who will embody the robber barons movement.
He has served as a perfect example of somebody who creates a national monopoly. His background isn't that unique. He was a second child to a six children family. He was born in a lower middle class family. His father was a salesman and his mother stayed at home. At a young age, he took a job as a book-keeper for a shipping company so it was basically a company that used railroads or ships to deliver products to market. This was before the Civil War (1861-1865).
He proved to be very good with numbers and he started coming up with ways to ship products much cheaper than they'd ship before (by using different rail companies, getting off the goods to different train stations etc). This allowed them to ship cheaper, get things to market much quicker and then maximize profits. He knew how to do things more efficiently than just about anybody else. He was very good at cutting costs and this allowed him to rise in the ranks of his shipping company. He started to make so much money in fact that when the civil war came along he was supposed to do his military service but he had enough money to hire a replacement. So while somebody else was off fighting the war for him, he continued to profit as a shipper.
During the Civil War, he realised there was this new burgeoning industry in the US: oil refining. Oil had become extremely important during the middle of the 19th century. Before this, people needed oil but not as much as they were going to need after the mid-1800s.
Before this, people got most of their oil from whales. They used it mainly as kerosene for lamps. But in the mid 1800's, there was an increase in steam operated machinery. They started to need grease to get railroad trestles to move. At this time, they didnt need petroleum as much there was not many things that ran on it at this point but they did need grease and oil to operate machinery and John D Rockefeller realised that whales were not gonna produce enough fat by this point and they would be becoming more and more scarce. So he knew they would need soon another way to get oil. Some people had started to extract this black gunk out of the ground and create grease and oil out of that but there was a problem with this: if you'd take the black gunk out of the ground it was not going to come out clean enough to just slap it into a machine because there were rocks, dirt and junk in it.
John D Rockefeller realised that there was a market in refining this oil and turning it into a finished product so he started in getting into refining where he'd basically filter it out and turn it into a finished product, something that could be put in the machine. He started doing this in Ohio.
And because he was such an efficient businessman, he managed to sell his oil for much cheaper than his competitors and he started to do well locally.
At that point, he was already making a lot of money and was earning more than most of his neighbouring competitors. That's when he slowly started to build his monopoly.
He started to look at his competitors. He'd go and say to them things like : "hey it looks like I'm starting to get an advantage on the market, you're soon not going to be able to compete with me so why don't you sell me your business?" Some would recognize straight away that they wouldnt be able to compete so they'd sell without fighting it. Others who had the monopoly on their local market didnt want to sell. These people were actually selling their products on the local market for cheaper than John D Rockefeller. This is because they had no transportation costs. But because John D Rockerfeller had more expendable capital than these guys, he was able to intentionally sell his products at a loss.
Taking a Loss
Let's say it was taking the competitor $9 to produce a barrel of oil. John D Rockerfeller would sell it at the market for $10. It'd take him $10 to produce the same barrel of oil and ship it to this guy's market. But because he had expendable capital, he'd go to this competitor's market and sell the barrel at a little loss for a while, long enough to become much cheaper than him. The competitor didn't have as much money so he couldn't follow and lower his prices. Clients would start buying John D Rockerfeller's oil. And the competitor would soon go out of business. John D Rockefeller would then be free to raise the price of barrels of oil to $25-$30. People wouldnt have any other option but to buy from him.
He started all throughout Ohio but he soon reached his neighbouring states. At the time, there was no rules against this type of techniques.
After the Civil War, transportation costs became so cheap that he soon got able to reach other states and ultimately spreading throughout the United States.
These devious methods were not illegal methods at the time because nobody had seen this type of thing before him. And other guys such as Andrew Carnegie started to do it too.
It was a sneaky behaviour but nobody was officially breaking any rules just yet.
Illegal
It was wrong morally but not legally. However, the more they were getting a monopoly, the higher were the prices to the clients.
Another problem is when you drive out of business basically all competitors, workers had no choice than working for these robber barons. This kept the wages low.
Another issue that came along is that they started to be getting bigger market shares and becoming so important that they could sort of strong-arm other companies that werent even in his industry.
As an example, when John D Rockerfeller started spreading out he became such a big a part of the railroad industry (sometimes representing half of their shipments), he went to these railroad companies and asked them to basically ship his products for no profit. If they'd refuse, he'd threatened them to stop using their services, hence threatening them to go out of business.
Competition
There were no rules against this and some people in the business started to be bothered by paying extra for oil, steel or whatever. As instance, they'd have to pay $20 or $30 for a barril of oil when it only cost John D Rockefeller $9.
They started to see these robber barons as a threat and they soon asked politicians to do something about it.
The rise of these big businesses and the politics
John D Rockefeller became the world's leading oil supplier. At the end of the 1800s, he beat
British or French oil suppliers.
He was owing about 90% of the refined oil business.
We could compare this as an octopus with arms into everything (hence the picture).
Republican politicians didnt do anything.
Democrats politicians were thinking too that it was not the government's responsibility to do
anything and those who were thinking in doing something got money from these robber barons. Most politicians were already corrupt at the time.
And for those who wouldnt accept the money, the robber barons could finance some guy running against them during the elections. They'd tell them : "we're going to make sure you have tons of people to send out your message, we're gonna make sure you'll be able to send letters, we're gonna you're gonna put advertisements everywhere. You'll beat this guy. You'll take over his seat."
And for those who wouldnt need all the help, they'd come up with a scandal or something. They'd blackmail them.
Public maninpulation through charities
These robber barons started to have so much money that they could start manipulating politicians and they could also start manipulating the public.
With huge money, you can do nearly everything - even manage to be seen as good guys. They started building museums, donating a lot of money to charities.
John D Rockefeller donated over 500 million dollars to charity and people would think they could trust him.
He also started to buy newspapers - the same newspapers which would picture him as a great guy. That was (and is still the strategy today) to be appealing directly to the general public. The idea was to tamp down their price gouging and ruthless business strategies.
Manipulating the system
John D Rockefeller got so wealthy at his peak that he'd be worth today over a trillion dollars.
These robber barons - John D Rockerfeller in particular - were so good at manipulating the system. These guys always found ways to prevent legislation against them from being put into place. However, that concerned to some extent the Federal Governement.
But because they were driving out of business (or threatening to drive out of business) local industries, the robber barons didn't manage to prevent State laws to be passed (in the 1880s in particular).
Some of these laws stopped them to own a majority of stocks in certain industries.
In 1887 also eventually, enough public pressure got the United States Government to create something called the "Interstate Commerce Commission". There was a tiny clause of the Constitution called the "Interstate Commerce Clause" and it was originally put in by the Founding Fathers to stop states to pass duties against one another and charge import-export duties against each others. They didn't want that to happen so basically the clause said that the federal government would control interstate trade.
So they used that clause to create this "Interstate Commerce Commission"and the purpose was to allow the federal government to investigate charges against some industries.
So the robber barons would start to face these issues. When some goods would cross state borders, the federal government could potentially get involved.
In practice, the law was not very effective but it was still a problem for the robber barons (they had to follow as well these state laws that said things like you can't own majority stock in another state etc). The most successful provisions of the law were the requirement that railroads submit annual reports to the ICC and the ban on special rates the railroads would arrange among themselves, although determining which rates were discriminatory was technically and politically difficult.
Trusts
John D Rockefeller and a number of these other robber barons came up with the idea of a trust.
These trusts were legal entities that allowed them to consolidate control over multiple companies. By placing companies under a single board of directors, they could coordinate actions, manipulate prices, and stifle competition.
So in reality, even if there was different businesses in name, they were operated under a single person or a single business.
John D Rockefeller, what he did was to start different companies and they were all under Standard Oil.
Indeed, to get around these interstate trade laws and these state restrictions they would say: "all right fine, I John D Rockefeller do not own this oil refining company in North Carolina. It's my friend's company. We're independent companies so as instance Steve Steveson officially runs Steve Oil, Bill Bilson runs Bill Oil and I John D Rockefeller run Standard Oil in Ohio".
But in reality, all these people would be meeting with John D Rockefeller and they'd be working together.
John D Rockefeller would distribute money to them and help if necessary to drive out of business the competition.
So in name they'd be different companies and hypothetically these friends could go off and you know do something against the Standard Oil Trust because the company's going to be in their name but in reality they wouldnt do that because they know it'd mean they'd end up out of business.
They were all basically operating under a single company so John D Rockefeller would basically own minority stakes in these various companies but in reality they're all taking orders from him. All these companies would be periodically meeting around a boarding table and decide things such as: "let's invest some money in your company, let's drive these people out of business. We'll all profit all right."
They developed these trusts and locally they couldnt do anything about it because they were not violating the state laws and technically they were not crossing interstate borders because they were all operating within their state.
In 1890, something called the "Sherman Antitrust Act" was passed. The public put enough pressure to deal with these trusts. The idea being that the federal government could intervene if they'd learn that there were companies operating in concert across interstate lines and operating in the interest of a trust to put out of business competition.
So basically if they could prove that people were acting in concert to suppress competition across interstate lines then the federal government could step in for stock sell-offs and regulate to basically make sure the company split apart.
But in reality this was impossible to prove - unless they could access the books, have witnesses etc. So the Sherman Antitrust Act was never really enforced.
By 1880, through elimination of competitors, mergers with other firms, and use of favourable railroad rebates, John D Rockerfeller controlled the refining of 90 to 95% of all oil produced in the United States.
Sources and further information:
Where did these robber barons get their money from?
Most of these robber barons were able to grow thanks to the help of European bankers who had lent them astronomical sums. American banks did not yet have the shoulders for these kind of loans. These bankers' investments paid off as the robber barons became the richest men in the world, with a fortune that exceeded that of many countries in the World. This wealth gave them the power and authority to eliminate competition, and to establish a monopoly disguised behind corporations that had different names, but the same owner.
The European bankers needed a representative in the United States, to act as an intermediary between them and the American industry, which was in full development. This role was played by JP Morgan who joined the Harriman, Carnegie, and Rockefeller power trio.
The most famous of all these European bankers were the Rothschilds.
When JP Morgan died, it was surprising to find that he owned only 17% of what people thought his wealth was. The rest of the 83% belonged to... Rothschilds.
The Rothschils were so powerful (and are still so powerful today) that they can control everything even the States and Royalties. As instance, Nathan Rothschilds - son of Mayer Rothschilds who built the empire in the UK - did say : “I care not what puppet is placed upon the throne of England to rule the Empire on which the sun never sets. The man who controls Britain's money supply controls the British Empire, and I control the British money supply.”
The Rothschilds in Europe:
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