Karl Marx, Abram Leon and the Jewish Question – a reappraisal

Issue: 119

John Rose

At some point, quite early on in our revolutionary “careers”, Jewish students of the 1968 generation had to confront On the Jewish Question written by the young Karl Marx in 1843. This was an awesome moment—almost a political virility test. (If you passed it, you were at least ready for the intellectual barricades, if not the physical ones.) Struggling through the high levels of Hegelian abstractions was unnerving enough. True, once you have more or less understood it, this is a robust, even outstanding, defence of Jewish emancipation. Yet, at the same time, Marx seems hostile to the Jews, with Jewish history reduced to crude economics:

Let us look for the secret of the Jew not in his religion, but rather the secret of the religion in the actual [meaning “economic”] Jew.1

Worse, the essay is peppered by what seems to be anti-Semitic polemic. And the reason for all this is that Marx appears to be equating the values of the new economic system that he would come to describe as capitalism with Jewish “trading”, “market” or money values.

It was a peculiar and very unsatisfactory experience. But there was an antidote.2 Not least of the great innovations of 1968 was the publication of Abram Leon’s The Jewish Question. This was an astonishing document, buried away since the war. Now Marxist academic Maxime Rodinson had brought it to the light of day, symbolically enough, at the Sorbonne university in Paris.

Abram Leon had been the leader of a tiny (Trotskyist) revolutionary socialist group in Nazi-occupied Belgium. He was hunted down, captured and perished in Auschwitz. Remarkably, he had written the manuscript under these wartime conditions. There was a touch of genius about Abram Leon to match Karl Marx and a touch of heroism to match Che Guevara any day.

Leon took the “economistic” passage quoted above from Marx’s original essay and developed a dynamic and ambitious study of Jewish history, locating the growing historical trading function of Jewish communities from antiquity to modernity at the root of Jewish survival. In fact Leon’s argument owes far more to the “mature” Marx’s theoretical structure in Capital than to the essay written in Marx’s young Hegelian days. Marx hardly mentions Jews in the three volumes of Capital. A rare and famous reference, discussed below, suggests the Jews are marginalised. This is the starting point for Leon. He argues that the Jewish trading communities were excluded from the rise of capitalism from the 13th century onwards, despite their long history—or, in fact, because of this history, since they were seen as potential competitors by new Christian traders in the developing national market economies.

I believe these positions require some amendment. Leon never discussed Marx’s original essay. Marx himself never explained why he abandoned the arguments he used in it. Moreover, new research stimulated in recent years by the emergence of academic Jewish studies suggests that there was indeed a modest Jewish contribution to the rise of capitalism. Indeed, treated with care and in a critical spirit, there is a case to be made that the connection the young Marx makes, between the Jewish economic role and modernity arriving so late in Germany, can complement and refine the position adopted by Leon.3

But because of the intense ideological, and often prejudicial, claims and counter-claims about this subject, analysis of the evidence requires caution in the context of a sophisticated theoretical framework. Consider what follows to be no more than work in progress to achieve this objective. First, let us look more closely at the original writings of Marx and Leon.

Marx’s Jewish Question

At the risk of considerable over-simplification, Marx’s essay can be reduced to the analysis of his two key concepts—emancipation and Jewishness—and how they are linked. However, a complication that cannot be avoided is that both of these concepts are open to two distinctively different meanings.

Marx’s idea of emancipation for Jews roughly corresponds to the granting of citizenship rights to them and the removal of discrimination by the French Revolution of 1789. A similar revolution is anticipated in the crumbling semi-feudal principalities that constituted Germany at the time. Marx defends emancipation in these terms from attacks from the leading “left” Hegelian, Bruno Bauer:

The disintegration of man into Jew and citizen, Protestant and citizen, religious man and citizen, does not belie citizenship or circumvent political emancipation. [On the contrary,] it is political emancipation…from religion.4

Religion becomes a private matter for the individual. Hence in the public sphere the individual, whatever his religion, ought to be entitled to equal rights.

But Marx sees this political emancipation as producing a very restricted form of freedom. It is an advance, but “political emancipation is a reduction of man to a member of civil society, to an egoistic independent individual on the one hand and to a citizen, a moral person, on the other”.5 This is an alienated emancipation—a split in a person’s human nature and a loss of potentially expanding human powers.

Thus man was not freed from religion; he received religious freedom… He received freedom of property. He was not freed from the egoism of trade but received freedom to trade.6

This passage leads directly to the two meanings of Jewishness. The first meaning is the one with which we are familiar—religious consciousness. (Marx never considered Jewishness as ethnic identity or as a nationalism—see footnote 11.) The second meaning is as a trading activity, and this does pose difficulties for us today. In other words, the last sentence in the passage above would be reinterpreted by Marx to state that man “received freedom to trade”, ie to become Jewish.

At the time Marx was writing, it was taken for granted that “Jewishness”, Judentum in German, was associated with money and trade. As the source book used on many of today’s university Jewish Studies courses puts it, “The German word Judentum had, in the language of the time, the secondary meaning of commerce”.7 This makes us very uneasy when we read it now. It is virtually impossible to shake out anti-Semitic connotations. But Marx really did mean that Judentum now dominated society to such an extent that “the Jewish practical spirit has become the practical spirit of Christian nations…and Christians have become Jews”.8

Judentum then appears as a symbol of an erupting and misunderstood modernity dominated by trade and money. In one of many notorious passages in the essay, Marx wrote:

What is the secular basis of Judaism? Practical need, self-interest. What is the worldly cult of the Jew? Bargaining. What is his worldly god? Money. Very well! Emancipation from bargaining and money, and thus from practical and real Judaism would be the self-emancipation of our era… The emancipation of the Jews, in the final analysis, is the emancipation of mankind from Judaism.9

This passage can legitimately be read as a clarion call for Jewish emancipation.

Market trading would no longer dominate Jewish everyday life. Everyone, Jews and non-Jews alike, would be emancipated from an economic system dominated by the market. Even Julius Carlebach, the most recent and most sophisticated in the long line of scholars to insist that Marx was anti-Semitic, was forced to conclude that:

Marx was determined to elevate Judaism into an abstract element like labour and that he no more intended personal harm to individual Jews by calling for the dissolution of Judaism than he would have wanted workers to be attacked when he called for the abolition of labour.10

Carlebach is acknowledging that Marx is dealing with an economic and social system that needs to be abolished. Abolish a particular labour system and workers will be free. Indeed, they will no longer be workers, in the capitalist sense—they will be free producers. Abolish a Jewish dominated economic system and Jews will be free. Indeed they will no longer need to be Jewish. Marx took it for granted that in a free society there would be freedom of worship, but he also took for granted that in a free society religion would wither away.

Incidentally, Marx did acknowledge his own Jewish origins, despite claims to the contrary. David Leopold has unearthed a particularly fascinating example where Marx additionally points to his Jewish heritage as a factor in his own intellectual creativity. Bauer had accused the Jews of being an “eyesore”. Marx responds in The Holy Family:

Something which has been an eyesore to me from birth, as the Jews have been to the Christian world, and which persists and develops with the eye is not an ordinary sore, but a wonderful one, one that really belongs to my eye and must even contribute to a highly original development of my eyesight.11

The youthful Marx was not the first to use Judentum to mean the domination of money:

Marx’s earlier demonisation of the money economy was stimulated…by none other than Moses Hess… Marx would seem to have drawn inspiration for his most “anti-Semitic” invectives from the work of the subsequent “father of Zionist socialism” and precursor of Jewish nationalism more generally.12

Carlebach provides a flavour of Hess’s writing at the time. It was the Jews’ “world historic mission to turn mankind into predators, and they have completed their mission”; “Money is social blood, but alienated, spilt blood”. Such “alienated, spilt blood” of man is symbolically consumed (in communion), so that in “the modern Jewish Christian pedlar world, the symbolism becomes actuality”.13

But to what degree did Judentum dominate the expanding “money” economy? This remains the subject of intense controversy.

Both supporters and critics of Marx are agreed that Jewish economic activities made a public impact. It is not necessarily anti-Semitic to assume they accelerated the way the market was bursting the ramshackle network of semi-feudal principalities that constituted the German economy prior to unification.

Thus Hal Draper, one of the most prominent defenders of Marx’s essay, explains how Jews had been “forced into a lopsided economic structure by Christendom’s prohibition on their entrance into agriculture, guild occupations and the professions”.14 This, in turn, affected the socio-economic structure of the Jewish community in three ways. First, “the upper stratum of Jews did play an important role in the development of post-feudal society, especially considering the tiny proportion of the population that they constituted”. Second, there was a “great tilt in the economic structure of Jewry toward middleman and financial occupations, including the bulk of poor Jews in huckstering occupations, for example, peddlers, petty merchants”. And third, there was the “relatively high visibility of the Jews’ economic role—as, for example, when Junkers (German feudal princes and officials) employed Jews as loan collectors and mortgage foreclosers, thus gaining the profits while the Jews gained the onus as ‘bloodsuckers’”.15

Similarly Carlebach recognises:

Like other medieval groups Jews were seen as a single socio-economic unit… The Prussian monarchs defined the value of the Jews as entrepreneurs and industrial innovators. They wanted economic expansion, foreign trade and currency and industrial investments. To this end, Prussia’s Great Elector permitted…Jews..to settle in Prussia and…would have regarded the protests of Christian traders—that Jews use innovatory, aggressive trading methods as opposed to their own sedate settled methods—as a full vindication of his intentions.16

In other words, the Prussian ruler used the Jewish elite simultaneously as a device to help develop capitalism and as a buffer against the nascent Prussian capitalists or bourgeoisie. This arrangement might have been very convenient for the Prussian aristocracy but it was extremely dangerous for the Jews. Without doubt, it helped fuel the way modern anti-Semitism would develop, and link Jews with money and power. The ferocious anti-Semitic riots against Jewish traders in Frankfurt in 1614-5 anticipated exactly these dangers.17

Most Jews remained very poor in the 18th century. But a standard text in contemporary Jewish studies notes the rapidity of the “rags to riches” story of the German Jewish middle class in the 19th century: “Ironically, it was the ignominious occupations of itinerant peddling, used clothes dealing and small scale usury, that had prepared the ground for this change”.18

A surprising source has inadvertently reinforced the argument being pursued here. Niall Ferguson, the neo-conservative historian and writer, was given first time access to the private documents of the Rothschild family—arguably the world’s most famous international banking family, with its roots in the Jewish ghetto of Frankfurt, Germany, in the 18th century. He has produced a stunning two-volume history, The House of Rothschild. As Marx was writing his essay, the Rothschild family already dominated European banking. James Rothschild, in particular, was financing the introduction of the railway system in France, the most potent symbol of the new industrial economic order that was emerging. Ferguson points us to a passage in Marx which follows that stark phrase “the emancipation of mankind from Judaism”. Marx cites Bauer’s claim that “the Jew who is only tolerated in Vienna…determines the fate of the whole empire through his financial power”,19 and Ferguson demonstrates that Bauer is referring to Rothschild.

Marx is responding to this personification of “Jewish economic power”. For Bauer this justified denial of political rights to Jews, while Marx argued that Jews were entitled to political rights. He put this particularly succinctly in a later polemic with Bauer in The Holy Family:

The Jew has all the more right to the recognition of his free humanity [ie the rights of man], as free society is thoroughly commercial and Jewish and the Jew is a necessary link in it.20

Heinrich Heine, poetic genius and another of the young Marx’s Hegelian comrades of Jewish origin, has left us an intriguing insight into James Rothschild, the “Robespierre of finance”:

Money is the new religion. It possesses the moral force or power which religion has lost… I see in Rothschild one of the great revolutionaries who have founded modern democracy… Robespierre and Rothschild…signify the gradual annihilation of the old aristocracy… [They are] Europe’s…fearful levellers… Rothschild destroyed the predominance of land, by raising the system of state bonds to supreme power, thereby mobilising property and income and at the same time endowing money with the previous privileges of the land. He thereby created a new aristocracy, it is true, but this, resting as it does on the most unreliable elements, on money, can never play as enduringly regressive a role as the former aristocracy, which was rooted in the land… For money is more fluid than water, more elusive than air… In the twinkling of an eye, it will dissolve and evaporate.21

Abram Leon’s The Jewish Question

The great innovation in Leon’s argument is that he provides the detailed historical analysis of the Jewish trading communities using the concept of a “people-class”, which is no more than hinted at in Marx’s original essay. His analysis anticipated the findings of academic Jewish studies by over half a century and overturns the Zionist “lachrymose” view of Jewish history in Europe which sees only “centuries of Jewish suffering” as a result of endemic anti-Semitism.22 Finally, it answers the question of how the Jewish people became an urban people.

An interesting starting point is the so-called “exile of the Jews” at the time of the fall of the Second Temple in AD 70. In fact “exile” is a myth because a flourishing diaspora already existed in the Roman Empire and beyond: “A majority of Jews lived outside the Roman province of Judaea”.23 Leon argues that this diaspora was already urbanising, characterised by “commercial prosperity”24 and beginning to be led by merchants. The Jewish community was a third of the half million strong population of Alexandria, the greatest commercial port city of the ancient world prior to Rome,25 and Jewish trading communities were sometimes so successful that they triggered conversions to Judaism in the urban areas, while the Jewish peasantry was assimilating into the “pagan”, then increasingly Christian and, later, Islamic countryside. Large numbers of Phoenicians and Carthaginians became Jewish, bringing with them “their commercial skills”.26 Islamic expansion throughout the Mediterranean arena and beyond enhanced the Jewish trading role: “Jewish traders served as important mediators in a world divided by Islam and Christianity… By the 9th century Hebrew had become a leading international language”.27

Ibn-Hurdadbih, the head of the Caliph of Baghdad’s postal and intelligence service in the middle of the 9th century, described a group of international Jewish merchants known as the “Radanite Jews” who traded over vast distances from the “Frankish” lands (roughly today’s France) to the Caspian Sea (on the northern coast of today’s Iran). Scattered along this well travelled trading zone were Jewish colonies, which organised the exchange of forest products, horses and hides, swords and slaves of both sexes from the west for luxury goods from the east.28 Jewish prosperity and political influence at this time impacted on the empire of the Khazars. Its elite actually converted to Judaism late in the 9th century as a way of maintaining its political independence and integrating itself into the Jewish trading network.29

The early feudal period in European history “was also the period of greatest prosperity for the Jews. Commercial and usurious ‘capital’ found great possibilities for expansion in feudal society. The Jews were protected by the kings and princes, and their relations with other classes were in general good”.30 An unlikely source, Abba Eban, the former senior Israeli cabinet minister and classics scholar, writes in his bestselling coffee table book, Heritage, Civilisation and the Jews, that Charlemagne, the commanding European figure of the early Middle Ages, “protected the Jews because of their services to trade and finance”. At this time “the original Ashkenazim Jews” arose as “economic pioneers, men of great mercantile enterprise. They were also deeply devoted to learning”.31

Leon’s conclusion was that “the Jews have been preserved, not despite their dispersal, but because of it”.32

However, as mercantile capitalism33 began to develop, and European nation states began to form, the Jewish trade role was threatened by the emergence of local traders. In the 11th century:

Western Europe entered a period of intense economic development. The first stage was…the creation of a corporative industry and a native merchant bourgeoisie… The growth of cities and of a native merchant class brought with it the complete elimination of the Jews from commerce. They became usurers…[but] the relative abundance of money enabled the nobility to throw off the yoke of the usurer. The Jews were driven from one country to another… In certain cities…the Jews became loan makers to the popular masses…in this role…they were often the victims of bloody uprisings.34

A good example was the expulsion of the Jews from England in 1290 where they had been official bankers to the king.35 But the most spectacular example was the expulsion from Spain and the official “hunt” for them by the Spanish Inquisition. Spain, with its “discovery” of the Americas, dominated the new mercantilism. Leon goes on to argue that Jews leaving Spain, and the rest of western Europe, were absorbed into eastern Europe, especially Poland and parts of Russia, since feudal structures survived and strengthened there. The Jewish “economic situation [became] very good” in Poland. They enjoyed “a special internal autonomy”,36 even managing estates on behalf of absentee landlords.

This is the single most important factor explaining why the majority of the world’s Jews were living in Poland, Russia and other parts of eastern Europe at the dawn of the modern period. Leon’s innovative approach is particularly important as it locates the roots of Zionism in the very specific history of these eastern European Jewish communities in the latter part of the 19th century.37

However, one result of the Leon perspective was to disconnect Jews from the rise of capitalism. Jewish merchants could not possibly be the “bearers of the new mode of production”.38 Leon takes a particular sentence in Marx’s Capital, a rare reference to Jews, which suggests that Jews, far from being central to the new economic system in western Europe, were economically marginalised in the backwaters of eastern Europe. Marx is discussing a point that trading peoples, historically, were outside society: “The trading peoples of old existed like the gods of Epicurus in the intermundia, or like the Jews in the pores of Polish society”.39

But Leon never tackled the paradox of the young Marx’s preoccupation with Judentum and the mature Marx’s abandonment of it.

How early modern Europe readmitted the Jewish traders

Leon writes, correctly, that “it is…inaccurate to regard the Jews as founders of modern capitalism. The Jews certainly contributed to the development of the exchange economy in Europe but their specific function ends precisely where modern capitalism begins”.40 But he also insists, without qualification, that the “mercantile economy…expelled the Jews. The Jew ‘banker to the nobility’ was already completely unknown in western Europe at the end of the Middle Ages… The collapse was a total one”.41

This is very misleading because the mercantile economy revived the specific mercantile function of the Jews in the period preceding modern (ie industrial) capitalism. Jonathan Israel’s path-breaking study, European Jewry in the Age of Mercantilism 15501750, provides a similar picture to Leon’s for the late Middle Ages but also points to the re-entry of the Jewish traders. Famously Oliver Cromwell favoured re-entry of the Jews into revolutionary England in 1655 “to trade and trafficke”.42 This led to the revival of their trading function in the context of the massive expansion of the European and Atlantic market:

No less important than army contracting, and perhaps more so, was the increasing role of Jews in state finance and international payments generally. This rested essentially on Amsterdam’s role as Europe’s chief bullion and money market combined with Jewish dominance of the gold, silver and other metal trades in central Europe. It arose also from the Jews’ particular need of government favours and concessions as well as their exceptional vulnerability to government pressure… But most crucial of all was the wide, not to say pervasive, reach of the closely knit…financial network and its ability to raise large sums with great speed, often on mere trust, and to remit money swiftly from one part of Europe to another.43

At the centre of this system were the “Court Jews”—bankers to the nobility:

In the course of time, the Court Jews not only accumulated riches and honours but evolved a lifestyle to match. Gradually they were exempted from many, but by no means all, of the irksome restrictions and curtailments which the Christian state imposed on the Jew.44

Earlier we saw Draper and Carlebach describing Jews as a single economic unit. Jonathan Israel analysed the unit’s tight social and economic structure, based on the metallic money economy that reflected the mercantile period:

The vertical ties…lent Jewish society its inner cohesion—[the] commercial collaboration and the patronage network implicit in Jewry’s institutions, charities, and welfare system—were of much greater significance than any occasional friction between rich and poor. First, at the apex of the pyramid, stood the elite of financiers, Court Jews, and princely agents; next came the much more numerous body of substantial merchants, manufacturers…, thirdly, and probably most numerous of all, was the mass of pedlars, hawkers, old clothes men, and other petty tradesmen; fourthly and less numerous but, nevertheless, a substantial proportion of Jewish bread-winners, were the craftsmen and artisans; finally, at the base of the pyramid was a depressed mass of vagrants, beggars, and other unemployed.45

Jewish emancipation reformers such as Moses Mendelssohn were determined to break up this medieval caste-like structure.46 That “break up” was inevitable under the twin pressures of the French Revolution, which lifted religious and occupational restrictions on the Jews, and the intense pressure for internal reform to bust the authority of the orthodox rabbis within the Jewish community.

Clearly we require a more complex and nuanced analysis of the Jewish contribution to capitalism and its economy. This will now be attempted with the some case studies.

The Spanish Inquisition

This momentous and horrific process for Jews and, indeed, the rest of Europe has been neglected by those historians grappling with the issues discussed here. Yet it formed the strategic springboard for the Catholic monarchs as they united Spain, and as Spain emerged as Europe’s principal maritime and mercantilist power at the end of the 15th century.47 The Inquisition was about obliterating all opposition, including Spain’s Muslims in the south. But it was preoccupied to the point of blind obsession with Jews, including converted Jews, known as conversos.

The Jews, who had formed about 2 percent of Spain’s population, were expelled in 1492. But tens of thousands preferred baptism to expulsion. This troubled the new Spanish authorities. Were the conversions genuine? The “new Christians” were rapidly integrating into the religious, political and economic hierarchy of the new Spain. In Castile conversos were very influential, both in many of the municipal councils of the growing towns and cities, and in local Catholic hierarchies. In Aragon converso officials dominated the crown administration of Ferdinand. The converso royal treasurer helped fund Columbus’s first voyage to America; conversos, and even practising Jews, were part of the crew. The scholarly consensus today is that most of the conversions were genuine. But there are two provisos. First, the very ferocity of the Inquisition revived pro-Jewish religious sentiment among some converso families. Second, a converso “consciousness” developed as a kind of hybrid combining Christianity and Judaism.48

We have here a lightning conductor for Judaism’s crisis at the dawn of capitalism. Judaism certainly did not pilot Spain’s maritime and imperial prowess. But neither was Judaism successfully excluded as the Spanish Empire tried to roll over the rest of Europe as well as dominate the high seas.

Shakespeare’s Jew: Shylock

In a standard left wing interpretation, Shylock, the Jewish moneylender, has been reduced to this grim restricted status by traditional Christian anti-Semitism, reinforced by the new mercantile period that witnessed the rise of proud and adventurous Christian merchants such as Shakespeare’s Antonio, the Merchant of Venice. However, the genius of Shakespeare allows for competing interpretations to coexist, each with a plausible claim on our attention, by virtue of the highly complex, contradictory and fast changing world at the beginning of the 17th century.

A simple linguistic manoeuvre helps. What happens if you replace the word “moneylender” with the word “banker”? Can Shylock, as banker, become the equal of Antonio, the merchant? Is this, also, what the play is about? After all “merchants” and “bankers” are often interchangeable economic roles. This cannot properly be explored within the confines of the play itself. But a legitimate exercise can test the claim against the real historical circumstances within which the play was written.

Tawney’s classic, Religion and the Rise of Capitalism, illustrated how English Protestantism was changing the meaning of usury or moneylending and modernising it at the very moment that Shakespeare was writing. A recent study, Norman Jones’s God and the Moneylenders, has fleshed out the empirical detail to support this argument:

The great money-men of early Jacobean London combined speculation and moneylending to make enormous profits, playing the role of bankers in a nation that had no banks.49

These men, like the wonderfully named Sir Baptist Hicks, were already becoming the new aristocrats and government officials in Shakespeare’s England. Even more intriguing is what was happening to the real merchants of Venice at this time. Christian merchants were losing the battle to control Jewish merchants. The special Venice Charter of 1589, though it fell short of granting formal legal equality, decisively expanded Jewish merchant rights. Later in the 17th century a sixth of Venice’s largest ships in its shipping fleet would be owned by Jews.50


Any serious investigation of the Jewish contribution to the rise of capitalism must include the intellectual or ideological contribution. Spinoza is one of leading philosophers of the Enlightenment. “No one, during 1650_1750, remotely rivalled Spinoza’s notoriety as the chief challenger of the fundamentals of revealed religion, received ideas, tradition, morality”.51 He helped clear the ideological and superstitious baggage and obstacles for the rise of science, an essential component of capitalism, especially its later industrial phase. He also helped lay the foundations for a scientific study of society itself.

Spinoza’s life history actually symbolises those menacing lines in Marx’s Jewish Question where Marx equates Judaism with money making and sees emancipation from both as the precondition for the quest for universal freedom.

One of the best studies of Spinoza provides a fascinating description of the philosopher’s break with both the Judaism and the merchant activities of his family in Amsterdam. They were originally Portuguese conversos who had re-established Jewish ties after emigrating to the city and were highly successful international traders. Spinoza was already struggling to make his break, but it was finally precipitated when the family business went into crisis after England blockaded Dutch trade.52

Isaac Deutscher has insisted, though, that Spinoza, and even Marx, should still be relocated in a Jewish tradition. They are:

“non-Jewish Jews”…Jewish heretics who transcend Jewry but who belong to a Jewish tradition, who…were exceptional in that as Jews they dwelt on the borders of various civilisations… Their minds matured where the most diverse cultural influences crossed and fertilised each other… It was this that enabled them to rise above their…times…and strike out mentally into wide new horizons and far into the future.53

The point is made in a different way by the principal architect of the Jewish Enlightenment, Moses Mendelssohn, in his effort to “reinstate” Spinoza. He saw it as a condition for Judaism’s survival in the modern world.54 It doesn’t really matter whether Mendelssohn was successful. The fact that the modern spokesman for the old religion had to pay such homage to the philosopher of atheism speaks for itself.

The Jews of Poland

Abram Leon was absolutely right about the way Poland appeared as a magnet attracting Jews fleeing expulsion from across Europe as new national markets emerged. However, Poland did not simply integrate the Jews into its feudal structure. The paradox here is that, while the internal feudal structure entrenched itself ever more deeply and oppressively amongst the peasantry, externally, Polish agriculture temporarily became a vital component of the western European mercantile economy.55 The Jews gravitated to the east of the country, which was much less developed and where the landed magnates wielded undisputed control. Western Europe wanted cheap Polish grain, which could be transported by eastern Poland’s river network. Jewish migrants began to settle in the numerous small towns and villages belonging to these great landlords.56 An Arenda system developed in which Polish nobles leased their estates to Jewish management.

Jews were thus the main agents…of a vast traffic encompassing the whole of Europe…for just as they sold the produce of the land for shipment to Holland and beyond, it was they who distributed the western cloth, salt, wine and luxuries, such as spices and jewellery.57

In 1648 Ukraine exploded. Over half the landed estates in Ukraine were managed by the Jewish Arenda on behalf of absentee Polish landlords. Led by a minor noble, Chmielnicki, the Ukrainian peasantry, aided and abetted by Cossacks and Crimean Tartars, rose up in rebellion against Polish rule and its Jewish agents. The targets were the Polish nobility, the Catholic clergy and the Jews who, as they were more numerous than the others, took the brunt of the losses. The Arenda system would eventually stagnate. Polish feudalism would sink into atrophy, paving the way for the partitioning of Poland by Russia, Prussia and Austria at the end of the 18th century. The mass of now impoverished Jews ended up in the Tsarist Russian Empire.58

The rise of the House of Rothschild

The roots of the Rothschild banking family lie deep in the Frankfurt Jewish ghetto:

A traveller arriving in 18th century Frankfurt, as he crossed the main…bridge could hardly miss the _Judensau—the Jews’ Pig, on the wall of the Jewish ghetto. Obscene graffiti depicted a group of Jews debasing themselves before—or rather beneath and behind—a fierce sow.59

As Goethe, the city’s most celebrated literary son, wrote, this was not just “private hostility, but erected as a public monument”. Yet:

There was to this persistent discrimination more than ancestral prejudice. An important factor was that the Gentile business community genuinely feared the economic challenge which they believed would be posed by an emancipated Jewish population. The fact that a slum like the Judengasse could produce mathematics teachers and doctors tells us something important about its culture; it was not as closed as it seemed. Despite—perhaps partly because of—the grim conditions in which they lived, the Frankfurt Jews were anything but an underclass in cultural terms.60

Out of this world stepped Mayer Amschel Rothschild in 1790, an antique dealer with a growing circle of suppliers and customers, to whom credit was extended from time to time. By 1797 he was one of the richest Jews in Frankfurt, and a central part of his business was banking, doing business with cities not only across Germany, but also with Vienna, Amsterdam, Paris and London.61 His big break came with an introduction to Prince William of Hesse-Kassel, who was one of the wealthiest German princes because he sold the “services” of his Hessian army to the highest bidder, “usually Britain”.62 Rothschild became, in effect, William’s “Court Jew”.63

When Napoleon’s French revolutionary armies chased William and his “court” out of the Frankfurt region, Rothschild helped the now exiled William conceal some of his fortune.

One financial move helped transform the Rothschild family into a vital component of the new industrial-economic complex now emerging in Europe, with England at the helm. Rothschild had sent one of his sons, Nathan, to the very heartland of the new industrial machine, Manchester, England. Nathan bought textiles, which were produced cheaper there than anywhere else, and sent them back to his father and brothers for sale in Europe.64 Now Nathan would handle the exiled William’s English investments.65 This “helped Nathan make the transition from Manchester merchant to London banker”66—in fact, Britain’s leading banker. He was quite simply “the richest man in Britain and therefore, given Britain’s economic lead at this time, almost certainly the richest man in the world”.67

Ferguson credits him with laying the foundations of the international bond market.68 In effect, the Rothschild brothers “were establishing that system of international monetary cooperation which would later be performed routinely by central banks, and on which the gold standard came to depend”.69

The Dual Revolution

Ferguson is particularly perceptive about the source of the Rothschilds’ power: “The most outstanding personal qualities may sometimes require exceptional circumstances and world-shattering events to come to fruition”.70 This had nothing to do with “Jewish power”. On the contrary, Ferguson argues, it derived from emancipation afforded to the Rothschilds by the Dual Revolution. This was made up of the economic changes driving England’s Industrial Revolution, which was about to spread across continental Europe, and the far-reaching struggle for mass democracy triggered by the 1789 French Revolution, which included, crucially, full Jewish democratic rights, and which would also spread across Europe and certainly cross the English Channel.

A new historical epoch was erupting with the possibility of an expansion and transformation of human resources and human potential, unimaginable to all previous generations.

Abram Leon once wrote of the “commercial and artisan heritage of Judaism, heritage of a long historical past”.71 There can be no question that this heritage is a factor helping shape the new epoch, though we should add the concept “intellectual” alongside the phrase “commercial and artisan”. The Dual Revolution produced the international Rothschild banking family as a part of an already existing and developing banking process. The poet Byron celebrated and satirised England’s most famous banker “twin-set” in Don Juan in 1823:

Who keep the world, both old and new, in pain
Or pleasure? Who makes politics run glibber all?
The shade of Bonaparte’s noble daring?—
Jew Rothschild, and his fellow Christian Baring.72

The Dual Revolution not only guaranteed modern freedoms for Jews, but also stimulated an outstanding Jewish contribution to European civilisation, of which “wealth creation” was just one part.

As Hobsbawm puts it, while most Jews were trapped in increasing poverty in eastern Europe:

The smaller communities of the west seized the new opportunities…even when the price they had to pay was a nominal baptism, as in semi-emancipated countries it often still was, at any rate for official posts… More striking than Jewish wealth was the flowering of Jewish talent in the secular arts, sciences and professions… By 1848 the greatest Jewish mind of the 19th century and the most successful Jewish politician had both reached maturity: Karl Marx (1818-1883) and Benjamin Disraeli (1804-1881)… The Dual Revolution had given the Jews the nearest thing to equality they had ever enjoyed under Christianity. Those who seized the opportunity wished for nothing better than to “assimilate” to the new society.73

Marx and capitalism

Capitalism has no religion. And it certainly has no roots in any particular religious or ethnic group. However, Marx noted that capitalism, as it developed, precipitated the Reformation, which tore Christianity into two parts, Catholicism and Protestantism. In his mature writings he associates the cult of money with Protestantism rather than Judaism. He writes:

The cult of money has for its corollary asceticism, abstinence, sacrifice, saving and frugality, contempt for the pleasures of the world, temporal and transitory, the eternal hunt for wealth. From whence the relation of English Puritanism and Dutch Protestantism with the action of making money.74

In Capital he shows how industrial production and the exploitation of labour power displace trade as the dynamo of the new economic system:

Now it is not trade that revolutionises industry, but rather industry that constantly revolutionises trade…commercial supremacy is now linked with the greater or less prevalence of the conditions for large-scale industry. Compare England and Holland for example. The history of Holland’s decline as the dominant trading nation is the history of the subordination of commercial capital to industrial capital.75

Marx, likewise, shows the banking system to be absolutely decisive in the development of modern capitalism, since credit “accelerates the material development of the productive forces and the creation of the world market”, but “at the same time credit accelerates the violent outbreaks of…crises… It is this dual character that gives the principal spokesmen for credit…their nicely mixed character of swindler and prophet”.76

Jews and capitalism

A theory cannot be summarised properly in one or two sentences. Still, Leon Trotsky came closest to capturing the Jewish dilemma regarding capitalism on the eve of the Nazi Holocaust:

In the epoch of its rise, capitalism took the Jewish people out of the ghetto and utilised them as an instrument in its commercial expansion. Today decaying capitalist society is striving to squeeze the Jewish people from all its pores.77

Of course, we now know that capitalism not only recovered after the war, but also witnessed the most sustained period of expansion in its history. Assimilation of Jews in the countries where the vast majority lived, in America and Western Europe, proceeded at an unprecedented rate. Jews became the most successful ethnic minority on any measure of equal opportunities and social mobility. However, Trotsky’s remarks remind us of the Holocaust’s genocidal legacy. It left such a deep scar that it contributed to the forced imposition of a Jewish state on Palestine.

Here we can legitimately adapt Trotsky’s remarks: capitalism now took the Jewish people and utilised them as an instrument for its oil imperialist expansion on Arab lands. In fact Trotsky had expressly warned against this with a prescience bordering on prophecy: “The future development of military events may well transform Palestine into a bloody trap for…the Jews”.78


1: From one of the best translations, Marx, 1967, p243. I thank Martin Tomkinson, former 1968 student leader at the London School of Economics, for what became the permanent loan of this book. I would also like to thank Alex Callinicos, Moshe Machover, Sabby Sagall and Brian Klug for commenting on the first draft of this article, and Neil Davidson and
Mark Thomas of the International Socialism editorial board for comments on the second draft.

2: Meeting Tony Cliff, the Jewish leader of the International Socialism group, forerunner of today’s Socialist Workers Party, was the second antidote. He prepared you for the physical barricades as well…

3: An early warning about reading Marx’s young Hegelian works is in order. His fondness for plays upon meaning makes this task very difficult. See Leopold, 2007, p8, an excellent book on the young Marx. Frederick Engels put it nice and simply: the young Marx wrote “very badly” just like a “German philosopher”. Heinrich Heine (like Engels himself) was a more positive stylistic influence. See below.

4: Marx, 1967, p227.

5: Marx, 1967, p241. Emphasis in the original.

6: Marx, 1967, p240.

7: Mendes-Flohr and Reinharz,1995, p327.

8: Marx, 1967, p244.

9: Marx, 1967, pp243-244.

10: Carlebach, 1978, p178.

11: Leopold, 2007, p172. Yes, it could be argued that Marx is ignoring a distinctive Jewish cultural identity in both secular and religious societies. Nevertheless, there is an equally robust defence of Marx as a product of the Jewish assimilationist movement at that particular time in the Germany of the 1840s-Traverso, 1994, pp21-22; Draper, 1977, pp591-608. Fifty years later Marx’s daughter, Eleanor, would insist on restoring her father’s Jewish identity, see Rose, 2005.

12: Fischer, 2007, pp41-42. Fischer is a young Jewish studies scholar, not at all sympathetic to Marx or the Marxist method. Nevertheless he seeks to rescue Marx and his essay from its constant misuse by revisionist German social democrats in the 19th and early 20th centuries. Fischer has also translated and published in the same book a previously unknown defence of Marx’s essay by Rosa Luxemburg. See also Isaiah Berlin, the 20th century Jewish liberal philosopher, who denounces Marx’s alleged “anti-Semitism”, praises Hess for “virtually inventing” Zionism but remains silent about Hess’s “anti-Semitism”-Berlin, 1959, pp17-18.

13: Carlebach, 1978, pp117, 123. Zionist socialism can be regarded as at least in part a Jewish revolt against the high visibility of Jews in the European “money” economy in the 19th century. See the study of Nachman Syrkin, Hess’s Zionist socialist pioneering disciple, in Frankel, 1981, pp288-328.

14: Draper, 1977, p597.

15: Draper, 1977, p598. Draper’s note on Marx and the Economic Jew Stereotype, pp591_609, argues that Marx was merely reflecting the deeply entrenched view about Jews and the expanding money economy at the time. But Draper does not properly address just how this view became so entrenched.

16: Carlebach, 1978, pp13, 53. See also Penslar, 2001, pp46-47, who shows how convenient it was for the authorities that the anti-Semitic imagination blamed the Jews for the rapid expansion in land speculation in the 19th century.

17: Israel, 1989, p68; Rose, 2004, p52.

18: Sorkin, 1992, p180.

19: Marx, 1967, p244.

20: Carlebach, 1978, p180.

21: Ferguson, 1998, pp213-214. Heine’s last line here makes an interesting comparison with one of the most famous lines in Marx and Engels’ The Communist Manifesto: “All that is solid melts into air, all that is holy is profaned, and man is at last compelled to face, with sober senses, his real conditions of life, and his relations with his kind.”

22: Rose, 2004, p43.

23: Barclay, 1996, p4, footnote 1. Where possible here I use a Leon theoretical framework but with updated sources.

24: Leon, 1970, chapter 2.

25: Modrzejewski, 1995, p73.

26: Baron et al, 1975, p21.

27: Baron et al, 1975, pp28-29.

28: Abramsky, 1986, pp15-18.

29: Abramsky, 1986, p16.

30: Leon, 1970, p82.

31: Eban, 1984, p119; Rose, 2004, pp46-50.

32: Leon, 1970, p122.

33: It is expedient here to assume the concept “mercantile capitalism” is complementary to that of “market feudalism” used by Chris Harman in A People’s History of the World.

34: Leon, 1970, pp82-83.

35: Rose, 2004, p50.

36: Leon, 1970, pp190-193. See also later in this article.

37: Rose, 2004, pp53-55, chapter 6.

38: Leon, 1970, p76.

39: Marx, 1991, p447. The footnote about Epicurus in this edition of Capital reads: “According to the Greek philosopher Epicurus (341 BC-270 BC), the gods existed only in the intermundia, or spaces between different worlds, and had no influence on the course of human affairs. Marx had studied Epicurus’s conception for his doctoral dissertation.” See also Leon,1970, p77.

40: Leon, 1970, p182.

41: Leon, 1970, p153.

42: Israel, 1989, p159.

43: Israel, 1989, p132.

44: Israel, 1989, p142.

45: Israel, 1989, p171.

46: Israel, 1989, p132; Rose, 2004, p57.

47: On the significance of Spanish mercantile capitalism, see Harman, 1999, p174, footnote 36.

48: The evidence on the Spanish Inquisition presented here is taken from Kamen, 1997. I would like to thank Sebastian Balfour, professor of Spanish history at the London School of Economics, for drawing my attention to this book.

49: Jones, 1989, p200.

50: Davis and Ravid, 2001, pp18-19, 88-94, 95. I would like to thank Michael Rosen for our discussion on the extraordinary claim that Shylock’s demand of a “pound of flesh” from Antonio can be considered as a circumcision threat: Shapiro, 1996, pp126-130. Shylock could be saying, “Treat me as an equal or I’ll make you into a Jew.”

51: Israel, 2002, p160.

52: Israel, 2002, pp166-167.

53: Deutscher, 1968, pp26-27.

54: Israel, 2002, pp658-659.

55: Another example of “market feudalism”: Harman, 1999, pp155-158. See also Kula, 1976.

56: Israel, 1989, pp27-29.

57: Israel, 1989, p30; Rose, 2004 pp53-55.

58: Rose, 2004, chapter 6.

59: Ferguson, 1998, p35.

60: Ferguson, 1998, p39.

61: Ferguson, 1998, p45.

62: Ferguson, 1998, p61.

63: Ferguson, 1998, p63.

64: Ferguson, 1998, p49.

65: Ferguson, 1998, p66.

66: Ferguson, 1998, p71.

67: Ferguson 1998, pp300, 304.

68: Ferguson, 1998, p125.

69: Ferguson, 1998, p137.

70: Ferguson, 1998, p47.

71: Leon, 1970, p236.

72: Ferguson, 1998, pp111-112.

73: Hobsbawm, 1962, pp234-235.

74: Traverso, 1994, p21. Marx here anticipates, by half a century, the conservative sociologist Max Weber, who, in his book The Protestant Ethic and the Spirit of Capitalism drew a link between the new Christianity and the ‘entrepreneurial spirit’. Tawney’s book, referred to earlier, is a response to Weber.

75: Marx, 1991, p451.

76: Marx, 1991, pp572-573.

77: Traverso, 1994, p204; Trotsky, 1940a.

78: Trotsky, 1945, p379.


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