Along with
H. B. Claflin,
Marcellus Hartley,
Robert L. Cutting, and
Joseph Seligman, he was a founder of the
Continental Bank of New York in August 1870.
Kuhn, Loeb & Company Schiff accepted Kuhn's invitation in January 1875, bringing to Kuhn, Loeb & Company his connections with Sir
Ernest Cassel of London,
Robert Fleming of
Dundee (later of London), and of the
Banque de Paris et des Pays-Bas (Bank of Paris and the Netherlands or Paribas). In 1885, Schiff became head of Kuhn, Loeb & Company. Besides financing Eastern railroads such as the
Pennsylvania and the
Louisville & Nashville, he took part in the reorganization of the
Baltimore and Ohio Railroad in 1896–99, and at various times aided the American Smelting & Refining Company (
ASARCO), the
Westinghouse Electric Company, and the
Western Union Telegraph Company. Less fortunate was his share in the reorganization in 1902 of the
Metropolitan Street Railway of New York.
National loans What is perhaps Schiff's most famous financial action took place during the
Russo-Japanese War (1904–1905). Schiff met with
Takahashi Korekiyo, deputy governor of the
Bank of Japan, in Paris in April 1904. Schiff agreed to extend loans to the
Empire of Japan in the amount of $200 million (equivalent to $ billion in ), through Kuhn, Loeb & Co. Schiff made this loan in part because he believed gold was not as important as national effort and desire to win a war and due to the apparent underdog status of Japan at the time: a European empire had not yet been defeated by a non-Western nation, in a modern, full-scale war. It is quite likely Schiff also saw this loan as a means of answering, on behalf of the Jewish people for the antisemitic actions of the
Russian Empire, specifically the recent
Kishinev pogrom in 1903. This loan attracted worldwide attention, and had major consequences. Since their domestic economy was still developing, Japan's military was dependent on massive imports of munitions, purchases made possible by Schiff's loan. In 1905, Japan awarded Schiff the
Order of the Sacred Treasure, and in 1907, the
Order of the Rising Sun, Gold and Silver Star, the second highest of the eight classes of that Order. Schiff was the first foreigner to receive the Order in person from
Emperor Meiji in the Imperial Palace. Schiff also had a private audience with King
Edward VII of the United Kingdom in 1904. In addition to his famous loan to Japan, Schiff financed loans to many other nations, including those that would come to comprise the
Central Powers. During World War I, Schiff urged U.S. President
Woodrow Wilson and other
Allied statesmen to end the war as quickly as possible, even without an Allied victory. He feared for the lives of his family, back in Germany, but also for the future of his adopted land. He arranged loans to France and other nations for humanitarian purposes, and spoke out against
submarine warfare. Schiff forbade any of the funds from his loans from going to the Russian Empire, due to the Tsarist regime's oppression of the Jewish people. When
the Tsar was overthrown in 1917, Schiff believed that the oppression of Russia's Jews would end and formally repealed the impediments within his firm against lending to Russia. However, Schiff's stance changed again upon the
Bolsheviks' seizure of power: "Schiff's gripe against Russia had been its anti-Semitism. At home Schiff had never shown any sympathy for socialism, not even the milder
Morris Hillquit variety. Schiff had declared victory for his purposes in Russia after the tsar was toppled in March 1917 and
Alexander Kerensky, representing the new provisional government, had declared Jews to be equal citizens. In addition to repeated public statements of support, he used both his personal wealth and the resources of Kuhn Loeb to float large loans to Kerensky's regime. When
Lenin and
Trotsky seized power for themselves in November 1917, Schiff immediately rejected them, cut off further loans, started funding anti-Bolshevist groups, and even demanded that the Bolsheviks pay back some of the money he'd loaned Kerensky. Schiff also joined a British-backed effort to appeal to fellow Jews in Russia to continue the fight against Germany."
Charitable endeavors Schiff believed in the Jewish charitable principle of
Zedakah. Beginning in childhood he recalled "Kindness was the keynote of the household... It was made our duty to put one-tenth aside for charity according to the old Jewish tradition." Schiff always felt strongly about his connection to the
Jewish people, and demonstrated this through his philanthropy. He founded the
Jewish Industrial Removal Office which relocated New York immigrant Jews to the Western United States. He also founded an additional point of immigrant entry to the U.S. through
Galveston, Texas. He supported relief efforts for the victims of pogroms in Russia, and helped establish and develop
Hebrew Union College, the
Jewish Theological Seminary, the Jewish Division in the
New York Public Library, and the
American Jewish Committee. Schiff grew to be one of American Jewry's top philanthropists and leaders, donating to nearly every major Jewish cause, New York examples being the
Montefiore Home for Chronic Invalids, of which he was president, the
Young Men's Hebrew Association building and the
Jewish Theological Seminary. He was also involved with many secular American causes: in addition to serving on the Board of Managers of the
New York Zoological Society, he gave to such organizations as the
Boy Scouts of America, the
Harvard Semitic Museum, the
American Museum of Natural History,
Metropolitan Museum of Art,
American Fine Arts Society,
American Geographical Society, and
Barnard College; and a number of other organizations for civil rights and the disadvantaged, such as the
American Red Cross, the
Visiting Nurse Service of New York and
Henry Street Settlement (New York) and
Tuskegee Institute. On his 70th birthday, he distributed $700,000 among various charitable organizations and public institutions. Schiff believed in the
Talmudic principle that "twice blessed is he who gives in secret." He did not permit his name to be attached to the buildings he sponsored, with the one exception of the Schiff Pavilion at his
Montefiore Hospital, and never discussed the size of his gifts. Because of his secrecy, the exact amount of his philanthropic donations is impossible to calculate, but it has been estimated between $50 and $100 million. The telegram is not known to have actually existed. Moreover, it has been argued that Schiff stopped financing transactions for Germany or the Central Powers as of 1914, stopped speaking German in public and was eager to demonstrate his moral and financial commitment to the Allied cause. A practitioner of
Reform Judaism, Schiff supported political, secular
Zionism. Despite not agreeing fully with the ideas of
Theodor Herzl, and in fact believing that Zionism would cause Americans to question his loyalty, he donated to many Jewish projects in Israel, including the
Technical Institute of Haifa. As the situation for Eastern European Jews grew more dire, with the
Russian Revolution and subsequent
Russian Civil War, and pogroms in Ukraine, Schiff made more considerable contributions to the Zionist effort; he even offered to join the Zionist organization, provided he could publish a statement he'd prepared. This offer was denied, and so he never formally joined the Zionist camp. Journalist
George Kennan noted that Schiff helped finance revolutionary propaganda during the Russo-Japanese War and Revolution of 1905, through the
Society of Friends of Russian Freedom.
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." ==Death==