You know Hancock and Washington and Franklin and Jefferson. You might even know Greene and Knox, Henry and Hale. And we know you know Hamiltonpretty hard to escape that one these days!
But it is very unlikely that you know the name of Haym Solomon. It’s unfortunate, because he was the one who organized the funding to keep the Continental Army alive during its darkest days, finding the money to keep the revolution going when many were ready to throw in the towel. He also helped found the Bank of North America – the nation’s first “national” bank. Solomon’s contributions to warfare and nation-building, though rarely discussed, were of major importance.
Haym Solomon was born into a Sephardic Jewish family in Poland in 1740. He traveled extensively through the banking and financial capitals of Western Europe, learning a thing or two and then moving on. He arrives penniless in New York via England as the colonies are on the brink of revolution. His expertise with money, as well as his ability to converse in several European languages, made him extremely valuable to foreign traders – he became a financial broker to New York’s bustling merchant community.
Solomon also established what would become a key friendship with Scottish maniac Alexander MacDougall, a businessman and former “politician” who was known for his aggressive disregard for class systems, hereditary titles and all things British rule in the colonies reminded him of home. MacDougall, a merchant sailor by trade and privateer (pirate) during the French and Indian Wars, was the street leader of the Sons of Liberty in New York. He liked to surround himself with other self-made men like Solomon and he especially liked to beat heads and rail against the King.
In the summer of 1776, the Sons of Liberty attempted to burn down New York City, denying shelter to the British army stationed there. It was General Washington’s whim and the Threads destroyed almost a quarter of all buildings standing before they were rounded up. Solomon was captured by the British Army in September of the same year and held for 18 months, part of that time confined to a boat and tortured as a spy. He managed to convince his captors that he was more useful to them as a translator and was employed as a liaison between the English officers and their Hessian mercenary allies.
Solomon uses this role to gain access to enemy military installations and to undermine German support for the British. He has been sabotaging since inside, dissuading the Hessians from fighting for the King of England. When these insurgent activities are discovered, Solomon is again arrested. This time, he pulls out a gold coin that had been sewn into his clothes and bribes a guard to let him escape. He flees to Philadelphia and arranges for his wife and son to meet him there. For the second time, Solomon arrives in a new American city penniless and forced to start all over again.
By this time, the tide has turned and the Continental Army begins to rack up the victories. The military, however, is still massively underfunded. General Washington does not have readily available cash and is crippled by this lack of financial flexibility. He frequently asks the Continental Congress to send money, but very little money arrives. Into this breach enters Haym Solomon, ready to serve in whatever capacity suits him best – as a broker to fledgling America.
Now that his merchant finance business is up and running again, Solomon begins to channel his own personal profits from the business directly into the revolution. According to records from the time, he granted interest-free “loans”, many of which were never repaid, to James Monroe, Thomas Jefferson, James Madison and even Don Francesco Rendon, the secret ambassador to the Court of Spain.
According to American Jewish Society for Historic Preservation:
Three years after arriving in Philadelphia in 1781, Solomon’s extraordinary abilities and multilingualism positioned him near the center of the financial heart of the American Revolution. He became the agent of the French consul and the paymaster of the newly allied French military forces in North America. The French, Dutch (via Saint-Eustache) and Spanish governments used Salomon to negotiate their loans helping to finance the American Revolution.
Huge loans flowing through his brokerage firm were converted into desperately needed cash for the Revolutionary American government and military. Paper money was almost never worth hard gold and silver. Solomon’s fees for his brokerage services to the troubled US government were extremely modest, if any at all. Perversely, partly because he was Jewish, the French, Dutch, Spaniards and Americans saw Jews in stereotypical anti-Semitic roles. They saw the Jews as Shylocks according to Shakespearean imagery. They viewed the Jews as medieval money lenders. Ironically, their fanaticism greased the way to Solomon’s success.
Solomon’s brokerage business grew so large that he was the largest depositor in Robert Morris’ Bank of North America.
Solomon arranged some of the most crucial loans for the war effort and, working in concert with Robert Morris – the Revolution’s chief banker – became central to the colonials’ eventual victory. When George Washington sees his one-in-a-million opportunity to ensnare and destroy Lord Cornwallis at Yorktown, money runs out and Solomon arrives. Washington cannot move his army into a siege position to capitalize on Cornwallis’ historic error because an army on the march must be fed. Robert Morris once again turns to Solomon the broker, who brings in the vital $20,000 when the treasury itself is empty. Within a day, the French and American armies, having the necessary funds, moved towards Yorktown and surrounded the city. Cornwallis is cut off from supply lines and quickly gives up.
The war is over, the colonies have won. The painting below, by John Trumbull, depicts the surrender of Lord Cornwallis after the siege of Yorktown:
In the 1780s, the United States was just beginning to become a new nation – but it was once again short of funds, having borrowed from all over Europe and from almost every noted merchant in the colonies. Once again, Morris and the founding fathers turn to their broker. “I sent for Solomon and asked him to try every way he could think of to raise the money, then I went to get some myself…Solomon, the broker, came and I urged to spare no effort to find money and means by which I can get it.
Legend has it that in the aftermath of the war, George Washington asked Haym Solomon what he wanted in return for his incredible service to the nation. Solomon reportedly said he wanted nothing for himself, but for the Jewish people to be recognized somehow. Washington is said to have arranged for the thirteen stars representing the colonies on the Great Seal of the United States of America to be arranged in the form of a Star of David.
If you look at the back of a dollar bill, it looks like this:
Urban legend busters tell us that piece with the star is fake, a myth due to the Jews’ desire to be incorporated into the early history of the country’s founding. They’re probably right, it’s way too fantastic a story to be true, but it would be cool if it were.
Haym Solomon will once again attempt to rebuild his fortune as it becomes apparent that the loans he made to early America would not be repaid anytime soon. At the beginning of 1785, he died of tuberculosis at the age of 44. His estate was worth $350,000 at the time of his death, a paltry total compared to the estimated $600,000 in principal and interest owed to him, money his family would never end up seeing.
Unlike the majority of the heroes of the American Revolution we are told about in elementary school, Solomon was not originally from Britain or the American colonies. He is not a statesman or a soldier or a wealthy landowner turned patrician Founding Father. But without his contributions and brokering skills, Washington’s army could not have been equipped, armed, and fed. The surrender at Yorktown that ended the war may not have been possible and the founding of the nation could not have been funded at first.
Haym Solomon was the nation’s financier when capital was scarce, credit was tight and everything depended on the flow of funds to keep the British on the run. He was the broker who saved America.