The parallel government

Sidney Weinberg turned a small broker into the investment bank Goldman Sachs - and with it into one of the most influential companies in the world.

Stephen K. Bannon, Gary D. Cohn, Steven T. Mnuchin, James Donovan and Dina Powell worked as strategy advisors, economic advisors, finance ministers, deputy finance ministers and deputy security advisers for US President Donald Trump. They were colleagues - and they used to be before as well: They all come from Goldman Sachs. The legendary and controversial investment bank traditionally which has good relations with Washington, whether a Republican or a Democrat rules in the White House.

Democrat Bill Clinton appointed Robert E. Rubin as Minister of Finance, who was previously on the board of Goldman Sachs. Republican George W. Bush made with Henry M. Paulson also became a Goldman Sachs manager as Minister of Finance. Under Barack Obama, Goldman Sachs partner William C. Dudley became President of the New York Central Bank. The close relations between the financial jugglers and the government have been around for a long time.

They started with Sidney Weinberg. Its rise is one of the most amazing careers on Wall Street. He went from janitorial assistant to boss at Goldman Sachs. For 39 years he headed the investment bank, his influence was so great that colleagues called him "Mr. Wall Street".

Weinberg turned a small brokerage house into a global company. And he laid the foundation for Goldman Sachs to be closely intertwined with the governments of the USA.

Sidney Weinberg was 16 years old in 1907 and was looking for a job. His parents had immigrated from Poland and had eleven children. He sold newspapers at the Brooklyn ferry terminal, on his back he had scars from stabbings, he had left school and he fought his way through. But that should come to an end, he wanted to work in an office.

So he went on a mission. In Manhattan, he chose a sublime building on 43 Exchange Street, a parallel street to Wall Street, and started at the top. On each floor, he asked if they had a job for him. In the evening he had arrived on the third floor, nowhere did they need him. And they also sent him away again at the brokerage company on the third floor. Weinberg still came back the following day and simply claimed that he had an appointment. After that, he was actually employed as a caretaker assistant for three dollars a week. The name of the company: Goldman Sachs.

Soon after he started there, he made friends with the founders. Henry Goldman and Samuel Sachs called him "the boy". But it was Paul Sachs, the son of Sam Sachs, who encouraged vineyard to continue his education in evening courses. Sachs paid him 25 dollars, and Weinberg enrolled at New York University. During the First World War, he volunteered to the Navy, where he made it to the military intelligence service and inspected cargo ships in Norfolk, in the state of Virginia.

After the war, Weinberg returned to Goldman Sachs in 1919 and began as a securities seller. He was so successful that he was promoted to partner in 1927 - Weinberg was thus only the second partner who did not come from the Goldman or Sachs families.

What made his ascent so remarkable was: Weinberg did not make much of numbers or mathematics. He was not one who had the investment business in his blood, not one who had a passion for it. But he could do with people.

And he was a storyteller. The author Malcolm Gladwell points out in the magazine "New Yorker" that Weinberg simply invented certain stories that increased his fame. Like e.g. this: Weinberg was a guest in the house of J. P. Morgan, where he was asked if it was true that he served in the US Navy during the First World War. Weinberg said to have said that he was a cook there, "Chef 2. Class". The truth is: Weinberg could not have been at this lunch, J. P. Morgan died 1913, i.e. before the First World War.

The deep stacking had method at Weinberg, he always wanted to show his counterpart that he came from another world. "I'm just a stupid, uneducated boy from Brooklyn," Weinberg has said to colleagues in the bank, which came to him with particularly tricky explanations. "Make it easier for me," he warned.

When the stock market collapsed in 1929, during the Great Depression, he managed tirelessly to save Goldman Sachs from doom, although his predecessors had speculated violently in the past. In 1930, he was appointed head.

Shortly afterwards, a second era began for his company, which continues to this day: that of Government Sachs. During World War II, President Franklin D. Roosevelt called Weinberg into the government. The banker became deputy director of the War Production Board, which organized armaments production in the USA. Weinberg and Roosevelt knew each other because Weinberg had been a member of the Democratic Party Finance Committee in 1932 and had collected considerable sums for the election campaign.

In his new job, Weinberg met many young managers at American companies, he was able to expand his network on the side. This should help him after the war as an entrepreneur. It was unusual that a Wall Street man like Sidney Weinberg supported Roosevelt. His New Deal was not particularly popular in financial circles. Weinberg didn't care, he cultivated his outsider image anyway. The president liked it, he was so taken with the banker that he absolutely wanted to send him to the Soviet Union as an American ambassador.

Weinberg declined, stayed in the USA and deepened his contacts into politics. Over the years, he advised President Harry S. Truman, Dwight D. Eisenhower and Lyndon B. Johnson. In this way, he managed to exert direct influence on the White House, a tradition that employees of his company continue to this day after Weinberg's death in 1969.

I'm just a stupid, uneducated boy from Brooklyn.