Bernard Baruch: Financier, Kingmaker, and Presidential Adviser

In this installment of ‘Profiles in History,’ we meet a successful stockbroker who becomes a presidential adviser and a close confidant of Winston Churchill.

Photograph of Bernard Baruch by Harris & Ewing. Library of Congress. Public Domain

Bernard Baruch (1870–1965) was born in Camden, South Carolina, but when his father, Simon, decided to move the family to New York City, the decision not only altered the trajectory of Bernard’s life, but also greatly influenced the trajectory of the nation during the early to mid-20th century.

Simon Baruch, father of Bernard, was a field surgeon during the Civil War. Public Domain

Simon Baruch, a German immigrant, had been a Confederate field surgeon during the Civil War. He continued to practice medicine in South Carolina, but economic opportunities appeared more readily available up north.

In 1881, the family moved to New York City, and by 1884, at the age of 14, Bernard Baruch entered the College of the City of New York, where he received a classical liberal arts education and excelled in the subjects of linguistics and political economy. After graduating in 1889, he worked numerous jobs, but kept his eye on finance and one day a spot on Wall Street.

Earning His Seat

In 1891, he was hired as a clerk for A.A. Housman and Co., which was one of Wall Street’s leading brokerage firms. He possessed a keen understanding of the market, and by 1895, he became a junior partner with the firm. In 1897, he took an investment gamble on the American Sugar Refining stock, which paid off significantly. He called it his “first financial coup”; it earned him $60,000. The payoff enabled him to make two life-changing decisions: He was able to purchase a seat on the New York Stock Exchange and get married.

His willingness to take risks combined with his superior business acumen allowed him to make a fortune on Wall Street. He ultimately opened his own brokerage firm in 1903 and earned the nickname “The Lone Wolf of Wall Street.” In 1905, with his vast fortune, he purchased the 16,000-acre Hobcaw Barony near Georgetown, South Carolina. It is now a natural preserve and wildlife refuge owned by the Belle W. Baruch Foundation.

There was no doubt about Baruch’s success. But it was his father who suddenly placed his son’s success into perspective.

“I could not forget my father’s look the day I proudly informed him I was worth a million dollars. The kindly, quizzical expression told me, more clearly than words, that in his opinion, money making was a secondary matter,” Baruch wrote in his autobiography “My Own Story.” “Of what use to a man are millions of dollars unless he does something worth while with them.”

Into the Public Sphere

He decided to move into the public sphere by accepting a trusteeship with his alma mater the College of the City of New York. It was here that he met the lawyer and politically connected William McCombs. McCombs was heavily involved in the Democratic Party, and  eventually became the campaign manager for Woodrow Wilson’s 1912 presidential election run. Through McCombs, Baruch was introduced to Wilson. A believer in Wilson’s policies and politics, Baruch donated substantially to his election bid.

When World War I began, Baruch believed that America would inevitably become involved and was one of the early prominent proponents of military preparedness. Military preparedness was a policy that Wilson defied until it became necessary. On Aug. 29, 1916, Congress passed an act establishing the Council of National Defense, which would “render possible in time of need the immediate concentration and utilization of the resources of the Nation.”

This council was made up of seven individuals who would “supervise and direct investigations and make recommendations to the President and heads of executive departments covering every phase of preparedness.” Baruch was appointed chair of the Raw Materials, Minerals, and Metals Committee.

Before taking this position he divested himself of a majority of his stock portfolio and sold his seat on the Stock Exchange in order to avoid any conflict of interest. He invested much of his money in Liberty Bonds.

Peace and Churchill

By the following year and after America declared war on Germany, Baruch was appointed to the War Industries Board. He eventually became its chairman in March 1918. When the war ended, Baruch, already a close adviser to Wilson, accompanied the president to Paris as part of the American delegation to the Preliminary Peace Conference. Baruch also became a member of the Reparations Commission.

While at the Paris Peace Conference, Baruch officially met Winston Churchill, who had served as Minister of Munitions for Great Britain. The two had corresponded consistently during the war, but it was their personal meeting that established a close friendship that lasted the rest of their lives. The friendship would prove beneficial in World War II.

WWI and the Paris Peace Conference had completely altered Baruch’s career path. “The war had taken me out of Wall Street, often described as a narrow alley with a graveyard at one end and a river on the other, and plunged me deeply into the broad stream of national and international affairs,” Baruch wrote.

When the Democrats lost the 1920 election, it apparently had little political effect on Baruch. In fact, he remained a presidential adviser in official and unofficial capacities for every president through to Lyndon B. Johnson. Baruch, with his vast wealth, would often play the role of power broker and “political kingmaker.”

Time magazine cover featuring Bernard Baruch, Feb. 25, 1924. Public Domain

Baruch’s political and industrial network came to the forefront when his friend, Churchill, came to visit the United States in 1929. Before arriving, Churchill wrote to Baruch, “I shall greatly like to travel under your aegis and with your companionship.”

Baruch coordinated people to host the visiting Churchill in places as far apart as California and Virginia. He introduced Churchill to political power players from both parties, as well as industry leaders, like William Randolph Hearst. When Churchill stayed at the Savoy Plaza Hotel in New York City, Baruch paid the bill.

Baruch visited Europe every summer, and when he returned in 1930, Churchill returned Baruch’s favor of hospitality. Churchill likewise introduced Baruch to some of the Britain’s famous and powerful individuals, and together they visited places like Oxford, Blenheim Palace, as well as numerous Royal Navy battleships. In 1931, when Churchill revisited America, Baruch made his Hobcaw Barony available to him.

Winston Churchill and Bernard Baruch converse in the back seat of a car in front of Baruch's home. Public Domain

WWII and Roosevelt

Politics, domestic policy, and foreign affairs had now become Baruch’s forte. When Franklin D. Roosevelt became president, Baruch became a member of Roosevelt’s “Brain Trust.” He assisted and advised, though not always agreeably, on Roosevelt’s New Deal plan. Even before the official start of World War II in 1939, Baruch was again an advocate for military preparedness. Part of that advocacy included strongly recommending the stockpiling of rubber and tin—insight that proved prescient.

When it came to advising Roosevelt, as well as other presidents, Baruch preferred not to make too much of the situation. He preferred to only arrive when the president was ready. Baruch would therefore sit on a bench near the White House and await “a signal light from the White House indicating that the president was ready to meet with him.” This led to him earning the nickname “The Park Bench Statesman.”

Baruch proved vital in his role as adviser to the Office of Wartime Production regarding economic mobilization and demobilization during WWII. After the war, he was appointed as the U.S. representative to the United Nations Atomic Energy Commission. His advocacy for an American monopoly on nuclear power, however, was rejected.

He supported Dwight D. Eisenhower in his bid for the presidency, but as the 1950s gave way to the 1960s, and he moved from his 80s into his 90s, Baruch eventually became less involved politically, though he remained available as a presidential adviser.

About 12 years before he died, his alma mater was renamed Baruch College. On his 90th birthday, a bench called the Bernard Baruch Bench of Inspiration and a bronze plaque was placed near the White House just northwest of the Andrew Jackson statue by the National Capital Area Council and the Boy Scouts of America. According to the inscriptions, the bench and plaque were erected to commemorate Baruch’s “Fifty Years of Service” and “For His Inspiring Devotion to Country And Distinguished Service to Boyhood.”

The original building on 23rd Street, known as the Lawrence and Eris Field Building of Baruch College, is still in use today. Tdorante10/CC BY-SA 4.0

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