See biographies by C. Adler (1928) and N. W. Cohen (1999).
(born , Jan. 10, 1847, Frankfurt am Main—died Sept. 25, 1920, New York, N.Y., U.S.) German-born U.S. financier and philanthropist. He immigrated to the U.S. in 1865 and in 1875 joined the investment-banking firm of Kuhn, Loeb & Co. He succeeded his father-in-law as head of the firm in 1885 and became one of the leading railroad bankers in the U.S. He played a pivotal role in the reorganization of several transcontinental lines, notably the Union Pacific Railroad and the Northern Pacific Railway. During the Russo-Japanese War he sold Japanese bonds in the U.S., for which he was decorated by the emperor of Japan. His extensive philanthropies included large contributions to Barnard College and the Jewish Theological Seminary.
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From his base on Wall Street, he was the foremost Jewish leader in what became known as the "Schiff era," grappling with all major issues and problems of the day, including the plight of Russian Jews under the tsar, American and international anti-Semitism, care of needy Jewish immigrants, and the rise of Zionism. He also became the director of many important corporations, including the National City Bank of New York, Equitable Life Assurance Society, Wells Fargo & Company, and the Union Pacific Railroad. In many of his interests he was associated with E.H. Harriman.
Upon the dissolution of Budge, Schiff & Company in 1872, Schiff decided to return to Germany. In 1873 he became manager of the Hamburg branch of the London & Hanseatic Bank. He returned to Frankfurt, however, upon the death of his father later that year. In 1874 Abraham Kuhn of the banking firm of Kuhn, Loeb & Company invited him to return to New York and enter the firm.
In 1885 Schiff became head of Kuhn, Loeb & Company. Besides financing such Eastern railroads as the Pennsylvania and the Louisville & Nashville, he took part in the reorganization of the Baltimore & Ohio Railroad in 1896-99, and at various times aided the American Refining & Smelting Company, 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.
He became associated with E.H. Harriman in notable contests with James J. Hill and J.P. Morgan & Company for control of several Western railroads. Schiff served as a director of the Equitable Life Assurance Society, National City Bank of New York, Central Trust Company, Western Union Telegraph Company, Union Pacific Railroad, Bond & Mortgage Guarantee Company, and Wells Fargo & Company. He was elected a director of Wells Fargo in September 1914 to succeed his brother-in-law, Paul Warburg, who had resigned to accept appointment to the original Federal Reserve Board.
Schiff always felt strongly about his connection to the Jewish people, and showed this through his philanthropy. 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.. However, he also financed many major American projects, believing strongly in the need to further develop and bring together the U.S.
Schiff grew to be one of American Jewry's top philanthropists and leaders, donating to nearly every major Jewish cause, as well as many secular American causes such as the Boy Scouts of America, the Semitic Museum at Harvard, the American Museum of Natural History, Metropolitan Museum of Art, American Fine Arts Society, and the American Geographical Society; and a number of other organizations for civil rights and the disadvantaged, such as the American Red Cross, Montefiore Home for Chronic Invalids, and Tuskegee Institute. He also played a role in the municipal affairs of New York City, and worked to shrink the reliance on machine bureaucracy in this arena.
During the Russo-Japanese War, in 1904 and 1905, in perhaps his most famous financial action, Schiff, again through Kuhn, Loeb & Co., extended a critical series of loans to Japan, in the amount of $200 million. He was willing to extend this loan due, in part, to his belief that gold is not as important as national effort and desire, in helping win a war, and due to the apparent underdog status of Japan at the time; no European nation had yet been defeated by a non-European nation in a modern, full-scale war. It is quite likely Schiff also saw this loan as a means of avenging, on behalf of the Jewish people, the anti-Semitic actions of the Tsarist regime, specifically the then-recent pogroms in Kishinev.
This loan attracted worldwide attention, and had major consequences. Japan won the war, thanks in large part to the purchase of munitions made possible by Schiff's loan, and elements of its government took this as evidence of the power of Jews all around the world, of their loyalty to one another, and as proof of the truth of the Protocols of the Elders of Zion. This thinking later led to the failed Fugu Plan, which would have saved many thousands of Jews from the Holocaust, bringing them to Japan-controlled China to work for the benefit of Japan's economy. In 1905, Schiff was awarded the Japanese Order of the Sacred Treasure; in 1907 he was honored with the Japanese Order of the Rising Sun. Schiff was the first foreigner to have been personally awarded the Order by Emperor Meiji in the Imperial Palace.
Schiff was also invited to a private audience in 1904 with King Edward VII of England.
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. When World War I finally did break out, he used his reputation and influence to urge President Woodrow Wilson, and others, to put an end to 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 engineered loans to France, and other nations for humanitarian purposes, and spoke out against submarine warfare.
Perhaps surprisingly, Schiff stood opposed to political, secular Zionism. He claimed to identify with Jews by faith, not by race. However, despite not agreeing fully with the ideas of Theodore Herzl, and in fact believing that Zionism was not compatible with American citizenship, he donated to many Jewish projects in Palestine, including the Technical Institute of Haifa. As the situation for Eastern European Jews grew more dire, with the Russian Revolution, 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.
Schiff died in New York City on September 25, 1920. He was succeeded as head of Kuhn, Loeb & Company by his son, Mortimer Leo Schiff (1877-1931).