Thomas Adam
Social Welfare between Private and State Responsibility
Dresdner Frauenkirche 1748
I.
Introduction: Rebuilding Dresden’s Frauenkirche
Since the destruction of the Frauenkirche in Dresden during the Second World War,
Dresdeners have been discussing the possibilities of rebuilding the old church (also
considered to be the local landmark). The East German government had decided not to
reconstruct it, but to keep the ruins as a monument to the horrors of war. After German
unification, the debate began again and the creators of the newly established Saxon state
yearned for a symbol of Saxon identity, which was to be resurrected (or constructed)
along with a dominant piece of architecture.1 The reconstruction of the Frauenkirche
required a great deal of money – about 250 million Deutsch Marks (about 125 million
Euro). Traditionally, such a project in Germany would have been financed by the state
and federal governments. Despite the financial problems of the current German
government, the federal government still assumes complete financial responsibility for
most endeavors, such as the Berlin Museumsinsel. However, in the current, neo-liberal
climate, German politicians and citizens are beginning to suggest that the state should not
be wholly responsible for all aspects of the common good. American society, and more
specifically, philanthropic engagement, has become a blueprint for the organization of
certain aspects of urban society. Therefore, to cover approximately half of the 250
million DM cost of rebuilding the Frauenkirche, a foundation has been formed which
includes twelve “Friends of the Frauenkirche” associations. These associations could not
expect a Bill Gates or a John D. Rockefeller to put the entire sum on the table; instead,
For the concept of national and regional societies as „imagined“ and constructed entities see: Benedict
Anderson, Imagined Communities: Reflections on the origin and spread of nationalism (London and New
York: Verso), pp. 1-7; Celia Applegate, A Nation of Provincials: the German idea of Heimat (Berkeley:
University of California Press, 1990).
1
2
they established a three-tiered contribution system: bronze, silver and gold. 500 DM
bought one the bronze membership, which entitled the contributor to regular updates on
the progress of the reconstruction and to have his or her name listed in the “Golden
Book” which will be displayed in the church. 1500 DM bought you immortality on the
list of donors to be displayed prominently in the church. 2500 DM allowed the
contributor to adopt a stone and will have his or her name go down in history on the list
of donors.2 In the end, such donor lists reflect the engagement of large numbers of
citizens and can be seen as a rebirth of philanthropy.
Before the turn of the twentieth century, philanthropy was the main basis for the
provision of social, cultural and educational services within the urban communities of
Great Britain, Germany and the United States. Of course, this did not happen within a
vacuum. The state, as David Hammack points out, created the legal infrastructure within
which philanthropy was able to happen.3 Philanthropy in the nineteenth century was the
provision of material, financial and ideal resources for cultural, social and educational
institutions by upper-class citizens. As such, philanthropic engagement could follow two
paths: individual philanthropy or collective philanthropy. Individual philanthropy refers
to the provision of money by one individual for the creation of a social, cultural or
education institution (e.g. hospital or hospital wing) which is often named after the
philanthropist. Further, in certain social and cultural institutions (social housing and art
museums), the benefactor expected to wield control over the institution or an important
aspect of it. In terms of social housing enterprises, the single benefactor chose where to
2
See the web page of the Freunde der Dresdner Frauenkirche in München e.V.
http://home.t-online.de/home/dresdner-frauenkirche.muenchen/
3
David C. Hammack, “Patronage and the great Institutions of the Cities of the United States: Questions and
Evidence, 1800-2000”, in: Thomas Adam (ed.), Philanthropy, Patronage, and Civil Society: Experiences
from Germany, Great Britain, and North America (Bloomington: Indiana University Press, 2004), p. 80.
3
build the houses, whom to house and in what fashion to house the families. Individual
philanthropy, to a certain extent, is part of a tradition of giving which extends back
throughout history.4 Religious duty and sympathy for the less fortunate have prompted
wealthy people to help those in need. One prominent example from Germany is the
Fuggerei established in Augsburg in 1516 by Jakob Fugger. Between 1519 and 1523,
Fugger financed the construction of 53 houses each containing two tenements (about 60
square meters each). These tenements were to be given to poor Catholic citizens of
Augsburg for a symbolic annual rent of one Rheinische Gulden. Since this rent covered
only one third of the annual expenses of the foundation, Fugger provided a foundation
capital of about 25 000 Rheinische Gulden which was to be set aside in a trust fund. Only
the interest on this amount was to be used for the maintenance of the apartment
buildings.5
Often nineteenth-century philanthropic undertakings were seen as being too vast
for one philanthropist to fund on his or her own. As David Hammack notes, the amount
of money given by wealthy Americans, such as Andrew Carnegie and John D.
Rockefeller, has never been very large.6 In fact, on both sides of the Atlantic, the majority
of philanthropic enterprises – museums, art galleries, hospitals and social housing
enterprises – have owed their existence not to the benevolence of a single philanthropist,
but to the collective efforts of a group of philanthropists. In such situations, a group of
4
Robert H. Bremner, Giving: Charity and Philanthropy in History (New Brunswick/London 1994).
Marion Tietz-Strödel, Die Fuggerei in Augsburg: Studien zur Entwicklung des sozialen Stiftungsbaus im
15. und 16. Jahrhundert (Tübingen: J. C. B. Mohr (Paul Siebeck), 1982), pp. 24-35; Hermann Kellenbenz
and Maria Gräfin Preysing, „Jakob Fuggers Stiftungsbrief von 1521“, in: Zeitschrift des Historischen
Vereins für Schwaben 68 (1974), pp. 95-116; Josef Weidenbacher, Die Fuggerei in Augsburg. Die erste
deutsche Kleinhaus-Stiftung (Augsburg 1926), pp. 52-55. Franz Karg, „Emersacker im 17. Jahrhundert. Zur
Erwerbung durch die Fuggerschen Stiftungen“, in: Jahrbuch des Historischen Vereins Dillingen XCIII
(1991), pp. 391-403. All these sources are from the archive of the Fuggersche Stiftung in Dillingen.
6
See: Hammack, “Patronage and the great Institutions“, pp. 85-87.
5
4
like-minded individuals came together to establish a social, cultural or educational
institution – i.e. collective philanthropy. To realize their ideas, philanthropists could
found limited-dividend companies (used mainly for social housing companies) and
membership organizations (for the support of museums and art galleries). Such
organizations could bring together more than one thousand members. Unlike individual
philanthropy, the power and influence of one individual within collective philanthropy
undertaking is limited because of the sheer number of participants and their level of
participation.
American scholars would call what I have dubbed collective philanthropy nonprofit organizations. I have chosen not to use this term for several reasons: 1) my research
focuses on the individuals who gave, their intent and motives, while studies of non-profit
organizations tend to focus either on the action of giving or on the outcome or effect of
the organizations; 2) also, the very term non-profit suggests that no profit was made for
the organizers. In the case of limited dividend companies in the social housing sector,
profit of up to seven percent was distributed among the shareholders. Since limited
dividend companies distributed profit among its shareholders they would not fit modern
definitions of the non-profit sector such as the one proposed by Helmut K. Anheier and
Lester Salamon.7 Their structural-operational definition of the nonprofit sector, as
Susannah Morris pointes out, “conflates organizational form with purpose so that
organizations which can distribute surpluses to their members, such as friendly societies
or model dwellings companies, are assumed by definition to be unable to operate in the
Lester Salamon and Helmut K. Anheier, “In Search of the Nonproft Sector. I: The Question of
Definitions,” Voluntas 3 (1992), pp. 125-151.
7
5
public interest.”8 Even though these nineteenth-century model housing companies were
considered philanthropic enterprises by contemporaries, social scientists, at the end of the
twentieth century, considered them for-profit companies. These model housing
companies, however, “were ‘philanthropic’ in so far as their primary aim was not profit
maximization per se but the development of a system of provision which could solve the
housing problem.”9
Both individual and collective philanthropy are modern in terms of scale and
scope. They differ from earlier stages of philanthropy (i.e. that of simply giving alms or
establishing poor houses) in which, comparatively speaking, smaller undertakings with
little to no impact on the social structure of the community dominated. Individual and
collective philanthropy in the nineteenth and twentieth centuries are intrinsically linked to
modern society. Whether acting alone or in concert with fellow wealthy citizens,
philanthropists acted not merely to counter instances of poverty, but to confront
dilemmas related to industrialization and urbanization – namely, how to organize and
provide for modern, urban society. For example, social housing enterprises were not only
larger in terms of the number of families housed, but also were structured in such a way
as to shape the modern family according to the societal visions of the philanthropist
(private versus communal living). These are the precise points where the modern
philanthropist differs from his or her pre-modern counterpart. Simply, the modern
philanthropist not only has a vision about how society should be run, he or she attempts
to realize this utopia. The merchant or nobleman of the sixteenth century gave money to
Susannah Morris, “Changing Perceptions of Philanthropy in the Voluntary Housing Field in Nineteenthand Early-Twentieth-Century London”, in Adam, Philanthropy, Patronage, and Civil Society, p. 142.
9
Susannah Morris, “Market solutions for social problems: working-class housing in nineteenth-century
London”, in: The Economic History Review vol. LIV, no. 3 (August 2001), p. 529
8
6
the poor on an individual and short term basis, and was not interested in eliminating
poverty or changing the form of society. The modern philanthropist not only has the
opinion that society should be changed to eliminate social ills or prevent them, he or she
undertakes to reform society with the intent of preserving the existing political and
economic order, while at the same time improving the conditions so as to make this goal
tolerable to all members of society.
Individual and collective philanthropy have been the pillars of German,
American, and British society during the late nineteenth and early twentieth centuries.10
Though philanthropy later mutated into other forms of communal responsibility
(cooperatives) or was superseded by other forms (social welfare state), it was the first
stage of providing social welfare within industrialized societies. As such, philanthropy
became the predominant mode of approaching the social question (soziale Frage). This
essay will demonstrate that on both sides of the Atlantic collective and individual
philanthropy was employed to solve the housing question (Wohnungsfrage). However, it
will be shown that Americans preferred collective philanthropy, while Germans adopted
collective as well as individual philanthropy when providing housing for working-class
families. This essay will, furthermore, highlight the involvement of women in
philanthropic undertakings in the second half of the nineteenth century. Women not only
were involved as members or caretakers of both collective and individual philanthropy,
they financed, administered and even created philanthropic enterprises. Finally, it will
explore the relationship between different providers of social housing (housing trusts,
For Germany and Great Britain see: Thomas Adam, “Philanthropic Landmarks: The Toronto Trail from a
Comparative Perspective, 1870s to the 1930s”, in Urban History Review 30 (2001), pp. 3-21; Margaret
Eleanor Menninger, Art and Civic Patronage in Leipzig, 1848-1914 (PhD thesis Harvard University 1998);
Susannah Morris, Private Profit and Public Interest: Model Dwellings Companies and the Housing of the
Working Classes in London, 1840-1914 (PhD thesis University of Oxford 1998).
10
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limited dividend companies, housing cooperatives and the state) at the beginning of the
twentieth century.
II.
Housing the Urban Poor
The provision of affordable and hygienic (physically and morally) working-class housing
was seen by contemporary social reformers and philanthropists as the most important
aspect of the social question. Living in unhealthy conditions was seen as not only leading
to disease, but also to the very destruction of the foundations of society. Therefore, the
amelioration of housing standards was necessarily connected with the improvement of
society as a whole. To put it simply, in the perception of nineteenth century upper-class
citizens, a well-housed worker was a happy worker and, as such, was unlikely to join
radical, working-class movements. This perception was not unjustified, at least in
Germany, given the dreary living conditions of the working class. Answering Minna
Wettstein-Adelt’s challenge, “Tell me where you live and I’ll tell you who you are,”
Alfred Kelly has suggested that, “most of the workers could not even be called human.”11
However, for a long time bourgeois and upper-class citizens were not even aware of the
conditions of working class housing. A contemporary German conservative remarked
that, “we were better acquainted with the condition of life of the half savage African
tribes than with those of our own people.”12 Thus, in order to solve the social housing
question, American, British and German reformers had to enter the world of the urban
working class. Before traveling abroad, all individuals involved in the social housing
11
Alfred Kelley (ed.), The German Worker: Working-Class Autobiographies from the Age of
Industrialization (Berkeley/Los Angeles/London 1987), p. 29.
12
Anthony Oberschall, Empirical Social Research in Germany, 1848-1914 (New York 1965), p. 81.
8
reform in Boston, New York, and Leipzig traveled into parts of their own city they had
never visited before – the slums and the working-class districts. Collecting information
about the actual living conditions of working-class families and then publishing it was the
first step towards a solution to the social question. Impressionist accounts of the living
conditions of the lower classes often written by aspiring social reformers, social critiques,
and volunteers or “friendly visitors,” who would visit working-class families in their
homes and make decisions about granting financial assistance, represented step in
identifying the problem.13 Shortly after, statistical studies, first on the level of the
municipalities and later on the federal level, complemented these impressionist accounts
and clarified the scope and extent of the housing problem. In 1886, Ernst Hasse,
professor of statistics at the University of Leipzig and director of the Statistical Office of
the city of Leipzig, published his major study Die Wohnungsverhältnisse der ärmeren
Volksklassen in Leipzig (The Living Conditions of the Lower Classes in Leipzig) in
1886.14 This path-breaking study was one of the first comprehensive analyses of the
housing market in a major city of the German Empire. Hasse provided extensive material
regarding the limited availability of small single-family apartments, the increase in rent
over a period of fifteen years, a comparative analysis of incomes earned by workers and
the rent for working class apartments, etc. This study gave Leipzig’s philanthropic
13
For New York see: Jacob August Riis, How the Other Half Lives: Studies among the tenements of New
York (New York: Charles Scribner’s Sons, 1917). For Riis see: the introduction by Donald N. Bigelow in:
Jacob A. Riis, How the Other Half Lives: Studies among the tenements of New York (New York: Hill and
Wang 1957), pp. vii-xiv. For Leipzig see: H. Mehner, “Der Haushalt und die Lebenshaltung einer Leipziger
Arbeiterfamilie“, in: Jahrbuch für Gesetzgebung, Verwaltung und Volkswirthschaft im Deutschen Reich 11
(1887), pp. 301-334. See also: Thomas Adam, „Wohnarchitektur und Wohnalltag in Leipzig vom
Kaiserreich zur Republik“, in: Leipziger Kalender 2001 (Leipziger: Leipziger Universitätsverlag 2001), pp.
92-94.
14
Ernst Hasse, Die Wohnungsverhältnisse der ärmeren Volksklassen in Leipzig (Leipzig: Duncker &
Humblot 1886). See also: Ernst Hasse, Die Stadt Leipzig in hygienischer Beziehung (Leipzig: Duncker &
Humblot 1892).
9
establishment a statistical basis for action. Furthermore, Hasse’s study was included into
the impressive two-volume edition Die Wohnungsnoth der ärmeren Klassen in deutschen
Großstädten (The shortage of tenements for the lower classes in German cities), which
was published as volume XXXI of the Schriften des Vereins für Socialpolitik
(Publications of the Society for Social Policy) in 1886.15 This volume provided, for the
first time, on the national level an empirical basis for any future steps of philanthropists
and social reformers to solve the housing problem for the lower classes. Chapters on the
living conditions of working-class families in Bochum, Chemnitz, Osnabrück, Crefeld,
Dortmund, Essen, Berlin, Elberfeld, Breslau, and Leipzig offered insight into topics such
as rent increases, hygienic standards, architectural structures, and density of the
population. “The importance of this investigation for housing reform throughout
Germany can” as Jan Palmowski rightly pointed out, “hardly be overestimated, for it
ended over a decade of silence” on the topic of housing reform.16
In the beginning, American bourgeois citizens were as unaware of the dreadful
living conditions in the immigrants and working class neighborhoods as their German
counterparts. New York’s and Boston’s social reformers and philanthropists’ first
expedition was to tour the slums and collect data regarding the housing of the lower
classes. In the 1870s, the newly founded Board of Health of the City of Boston took a
lead in investigating the living conditions of the city’s poor. In April 1873, the board
began a large scale inspection of tenement housing in Boston which provided public
15
Die Wohnungsnoth der ärmeren Klassen in deutschen Großstädten und Vorschläge zu deren Abhülfe.
Gutachten und Berichte herausgegeben im Auftrage des Vereins für Socialpolitik. Zweiter Band (Leipzig:
Verlag von Duncker & Humblot 1886).
16
Jan Palmowski, Urban Liberalism in Imperial Germany: Frankfurt am Main, 1866-1914 (Oxford:
Oxford University Press, 1999), p. 221; Nicholas Bullock and James Read, The Movementf or Housing
Reform in Germany and France, 1840-1914 (Cambridge/New York: Cambridge University Press, 1985),
pp. 63-70.
10
awareness of the housing problem.17 Already in early 1870, Henry Ingersoll Bowditch,
after he was elected chairman of the Massachusetts State Board of Health, toured the
slums of Boston. The tenements he saw left him appalled and resolved to achieve
betterment. On December 1, 1870, Bowditch embarked on a second trip into Boston’s
slums. Bowditch reported this second encounter with lower-class housing in his
published “Letter form the Chairman of the State Board of Health” hoping that wealthy
Bostonians would feel compelled to engage in housing reform.18 To underline the
importance of such reform, Bowditch included a graphic description of one particular
Boston home: “This cellar room is scarcely high enough for us to stand erect. One can
easily almost touch each of the four sides while standing in the centre of it. The floor is
dark, dirty and broken; apparently wet also, possibly from the tide oozing up. Two
women are there, commonly, yet rather tawdrily dressed, and doing nothing but
apparently waiting, spider-like, for some unlucky, erring insect to be caught in their dusty
but strong meshes. Tubs, tables, bed-clothes and china ware, are huddled incongruously
together. Our guide strikes a match by the stove, and then opens a door into a so-called
bed-room. It is a box, just large enough to hold a double bed. No window is in it, no
means of ventilation, save through the common room up the cellar steps. The bed is of
straw, covered only by a dirty blanket. Everywhere is the picture of loathsome filth. The
stench, too, of the premises is horrible, owing to long accumulated dirt, and from the
17
David M. Culver, Tenement House Reform in Boston, 1846-1898 (PhD thesis Boston University 1972),
pp. 94-95.
18
Henry Ingersoll Bowditch, “Letter from the Chairman of the State Board of Health, concerning Houses
for the People, Convalescent Homes, and the Sewage Questions”, in: Second Annual report of the State
Board of Health of Massachusetts January 1871 (Boston: Wright & Potter, State Printers, 1871), pp. 182243.
11
belching up of effluvia from solutions of dark mud, reeking with sewage water from the
city drains and water-closets. It is difficult for us to breathe in the tainted atmosphere.”19
Bowditch’s next move was to call for a housing reform under the guidance of
philanthropically minded Bostonians. Since he did not know exactly how to proceed in
reforming the housing of the working class, he made an extensive trip to London where
he spent six months.20 In the last quarter of the nineteenth century, the British metropolis
attracted a large number of social reformers form various countries including the United
States and Germany who wanted to study the economic organization and architectural
design of the city’s working-class housing projects as well as their impact on social and
moral standards.21 London’s social housing enterprises were held in high regard among
German and American housing reformers. Between 1841 and 1914, wealthy Londoners
had created about 43 social housing enterprises which by 1914 provided about 36 000
tenements for the poor. The Peabody Trust and the Waterlow’s Improved Industrial
Dwellings Company were in a top position among these enterprises with regards to the
number of constructed apartment units.22
Peabody and Waterlow’s housing enterprises represent examples of individual
and collective philanthropy, respectively, and differing societal visions. George Peabody,
a U.S. businessman, donated £500 000 for the creation of a social housing trust, which
was to direct any profit back into the trust. He made the conscious decision to establish
his own social housing enterprise and engage in individual philanthropy. The director of
19
Ibid, p. 191.
He compiled his observations of the London philanthropic housing scene in the already quoted “Letter
from the Chairman”, pp. 182-243.
21
See Thomas Adam, “Transatlantic Trading: The Transfer of Philanthropic Models between European and
North American Cities during the Nineteenth and Early Twentieth Centuries,” in: Journal of Urban History
28 (2002), pp. 328-351.
22
Morris, Private Profit and Public Interest, pp. 60-61.
20
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the Society for Improving the Condition of the Labouring Classes, Lord Shaftesbury,
suggested that Peabody donate £75 000 to this existing organization (collective
philanthropy). Peabody rejected this offer, because he wanted to be remembered in
history for his own philanthropic endeavor.23 Though Peabody enlisted the help of a
committee in deciding how to use the money, he was the sole financier of this trust so as
to maintain ultimate control over it. Sydney Waterlow, on the other hand, founded a
limited-dividend company in which the profits (limited to five percent) were distributed
among the various share-holders. Both enterprises represent different strategies and views
about how to solve the housing question. Peabody’s housing project intentionally
excluded capitalist methods (profit for the investor). Clearly, he was not convinced that
the housing problem could be solved using capitalist means. It is an admission that within
the sphere of market society certain problems could not be solved. Conversely, Waterlow
tried to solve the housing problem within the sphere of the market economy. By allowing
for profit, though substantially reduced, Waterlow attempted to combine market economy
and social welfare.
Bowditch was very much impressed by Waterlow’s model and brought a
description of how it worked back to Boston.24 From the outset, Bowditch remained very
skeptical about the success of Peabody’s housing trust. Although he recognized the
successes of the Peabody Trust in elevating the social and moral conditions of their
tenants, he concluded in his Letter from the Chairman that the Peabody buildings “are
almost purely philanthropic” and therefore, they do not represent a potential way to solve
the housing problem. “The percentage for rents on the original outlays is so small that no
23
24
Morris, “Changing Perceptions of Philanthropy”, p. 150.
Bowditch, “Letter from the Chairman”, pp. 201-210.
13
capitalist would desire to employ his surplus funds without greater gain.”25 Bowditch
who believed that philanthropy was supposed to provide a net gain for both sides – the
one who gives and the one who takes – and that the main function of model tenements
was to spark imitation, concluded that “we must look in other directions as for plans and
successful experiments in which philanthropy and capital join hands.”26 Disappointed
about the perceived limited success of the Peabody endeavor, Bowditch quoted the
critique of an anonymous London capitalist on the Peabody buildings: “Excellent as they
are, how much more good would have been done, and how many more families would
have been placed in healthful homes if instead of building these large and expensive
tenements, the fund had, in part at least, been spent in the purchase of suitable sites which
might have been let at such low ground-rent as to induce capitalists to build houses
according to certain specifications to be laid down by the trustees.”27
Rejecting the concept of a housing trust and “pure philanthropy,” Bowditch found
his perfect solution to the housing problem in Waterlow’s Improved Industrial Dwelling
Company. Although a similar undertaking had been organized in Boston during the
1850s, Bowditch remarked that “nothing has ever been carried out on so grand a scale as
by the above named company in London.”28 In 1871, Bowditch convinced 163 wealthy
Bostonians to form the Boston Co-operative Building Company (BCBC), which was
capitalized at $200,000 and limited to seven percent dividends. The $200,000 was
divided into 8,000 shares at $25 a piece. Four thousand nine hundred and fifty two shares
were immediately bought, and the remaining shares were sold within the subsequent four
25
Ibid, p. 198.
Ibid, p. 198.
27
Ibid, p. 199.
28
Ibid, p. 202. For this earlier housing experiment see: Charles Eliot Norton, “Model Lodging-Houses in
Boston”, in: Atlantic Monthly No. 5 (June 1860), pp. 673-680.
26
14
years. By 1873, the foundation had $182,000 capital stock, and by 1875, $207,000. In
1900, twenty nine years after the foundation of the BCBC, the capital stock was valued at
$292,000.29 It should be noted that by 1912, 204 individuals owned 6,211 shares, while
65 trustees held 5,008 shares (in addition to three firms which held 393 shares and one
corporation holding 68 shares).30 These figures are indicative of the large number of
individuals active in the financing of the company and of the fact that the shares were not
sold, but passed onto trustees in the last wills and testaments of the original shareholders.
In 1902, the Company had “a capital of $292 000, it [had] about $400 000 invested in
seventy-eight houses with 985 rooms, occupied by 311 families containing 1, 023
persons.”31 By 1912, it owned 5 building complexes with a total of 332 apartments: the
East Canton Street Estate had 154 tenements, the Clark Street estate 19, Thatcher Street
Estate had 54, Harrison Avenue Estate 84, Massachusetts Avenue Estate 21.32
The BCBC was not the only philanthropic housing enterprise which was founded
in an American city using the model of Waterlow’s Philanthropy and Five Percent model
but it was the first one. According to the Twenty-Third Annual report of the BCBC,
housing reformers and philanthropists from “New York, Philadelphia, and Baltimore, and
one even from Europe, who all commended the general plan and construction of our
houses and the facilities they afford for housing the poor,”33 visited and studied this
29
David M. Culver, Tenement House Reform in Boston, 1846-1898 (PhD thesis Boston University 1972),
pp. 144-145; Robert Treat Paine, “The Housing Conditions in Boston”, in The Annals of the American
Academy of Political and Social Science vol. XX (July, 1902-December, 1902) (Philadelphia 1902), p. 125;
The First Annual Report of the Boston Co-operative Building Co. with the Act of Incorporation and ByLaws (Boston 1872), p. 3; Third Annual Report of the Boston Co-Operative Building Company (Boston
1874), p. 10; Twenty-Ninth Annual Report of the Boston Co-Operative Building Company (Boston 1900),
p. 20.
30
Forty-First Annual Report of the Boston Co-Operative Building Company (Boston 1912), p. 8.
31
Paine, “The Housing Conditions in Boston”, p. 125.
32
Forty-First Annual Report of the Boston Co-Operative Building Company (Boston 1912).
33
Twenty-Third Annual Report of the Boston Co-Operative Building Company 1894, p. 12.
15
enterprise. Henry I. Bowditch and the BCBC served as a conduit for the translation of
Waterlow’s “Philanthropy and Five percent” into the American social, cultural and
economic context. While the basic elements of this model remained unchanged, the
limitation on the dividends was slightly raised to seven percent. This modified concept of
the limited dividend company was copied in many American cities during the 1880s and
1890s. After Alfred Treadway White had followed in Bowditch’s footsteps and traveled
to London in 1872, he established the Home Buildings in Brooklyn in 1877. These
buildings were in their architecture the “first literal translation of the Waterlow type”34
Three years later, White was able to convince fellow wealthy New Yorkers such as
Cornelius Vanderbilt to found the Improved Dwellings Association as a limited dividend
company. In 1896, White finally initiated the establishment of another limited dividend
company – the City and Suburban Homes Company. Headed by Elgin R. L. Gould, this
company “was destined to become the largest builder of model tenements in the
country.”35 Philanthropists and housing reformers in Washington and Cincinnati followed
in these footsteps and created similar housing enterprises which were based on the
Americanized version of Sydney Waterlow’s project.36
The goal of the Boston Co-operative Building Company was to build “small
houses that should contain suites of apartments isolated, so far as may be possible under a
34
Richard Plunz, A History of Housing in New York City: Dwelling Type and Social Change in the
American Metropolis (New York: Columbia University Press, 1990), p. 89
35
Ibid, p. 101; First Annual Report of the City & Suburban Homes Company; Four Decades of Housing
with a Limited Dividend Company (Federal Housing Administration, Division of Economics and Statistics).
36
Eugenie Ladner Birch/Deborah S. Gardner, „The Seven-Percent Solution: A Review of Philanthropic
Housing, 1870-1919“, in: Journal of Urban History 7 (1981), pp.403-438; Edith Elmer Wood, Recent
Trends in American Housing (New York: The Macmillan Company, 1931), pp. 206ff.; Robert B.
Fairbanks, “From Better Dwellings to Better Community: Changing Approaches to the Low-Cost Housing
Problem, 1890-1925”, in: Journal of Urban History 11 (1985), p. 321; Robert B. Fairbanks, Making Better
Citizens: Housing Reform and the Community Development Strategy in Cincinnati, 1890-1960 (Urbana and
Chicago: University of Illinois Press, 1988), pp. 35-36.
16
common roof.” The first project was the creation of ten small houses in which “the floors
should be so arranged as to accommodate one family only, and thus, though the entrance
and the stairway will be in common, there being only one set of occupants on each floor,
a tolerable degree of privacy will be secured.”37 This first project is not only an economic
translation of the Waterlow model to Boston, but also a translation of Waterlow’s views
on the ideal apartment structure (heightened levels of privacy for individual families).
The similarities between Bowditch’s and Waterlow’s enterprises are not one I have
inferred, but explicitly apparent in that in one of the following housing projects two of the
streets were named “Waterlow Street” and “Sydney Place”, respectively, in honor of the
English philanthropist.38
Like their American counterparts, German social reformers studied London’s
social housing models and introduced them into German cities during the second half of
the nineteenth century. In contrast to the shipment of philanthropic models via the
Atlantic, German social reformers and philanthropists had, however, not only a much
shorter distance to overcome but also enjoyed the help of a member of the British royal
family who assumed the function of a transmitter in this transnational transfer. In July
1862, Alice, the second daughter of Queen Victoria, married Duke Ludwig of Hesse and
moved from London to the provincial city of Darmstadt. Very soon Alice, “who had
hardly ever been away from her family before, was homesick and bewildered …”39 She
felt alienated and rejected by Darmstadt’s higher society. “Within a week of arrival she
had met all the members of the government and found them almost impossible to talk to.
37
First Annual Report (BCBC), pp. 3-4.
Christine Cousineau, Tenement Reform in Boston, 1870-1920, Philanthropy, Regulation, and
Government Assisted Housing (The Society for American City and Regional Planning History, the
Working Paper Series 1990), p. 8.
39
Gerard Noel, Princess Alice: Queen Victoria’s forgotten Daughter (London: Constable, 1974), p. 107.
38
17
They stood waiting to be spoken to and were wholly unresponsive to her desperate efforts
to make polite and suitable conversation.”40 Furthermore, the new social environment did
not offer her a role in public life which would have fulfilled her expectations. “The Grand
Duke’s principal minister, Dalwigk – whom Alice came to detest and distrust later on –
was intent on proving that the young Princess could do nothing more than imitate her
sister’s example in Berlin. By this he was implying that Alice was and should remain a
mere cypher.”41 Gillian Darley even contended in her biography of Octavia Hill that
Alice was not only “unhappy” in Darmstadt but that she “hated life in a provincial
German city.”42 While Gerard Noel and Gillian Darley’s43 assumption about the unhappy
marriage of Alice has been repudiated by Eckhardt G. Franz44, it is clear that she longed
for a purposeful task within Darmstadt’s society. In 1863, she began visiting hospitals
and, influenced by Florence Nightingale, founded the Hülfsverein (Committee of Aid)
and the Alice Society for Aiding the Sick and Wounded. It was her goal to establish a
network of aid associations run by women for the entire duchy of Hesse-Darmstadt after
the blueprint of Baden, Bavaria and Prussia.45 In addition to her engagement in the field
of medical care, Alice also considered the education and professional training of women
40
Ibid, p. 108.
Ibid. For the relation between Victoria and Alice see: Wilfried Rogasch, “’Vicky’ und Alice – zwei
coburgische Prinzessinnen in Preußen und Hessen“, in: Michael Henker and Evamaria Brockhoff (eds.),
Ein Herzogtum und viele Kronen: Coburg in Bayern und Europa (Regensburg: Verlag Friedrich Pustet,
1997), pp. 74-80.
42
Gillian Darley, Octavia Hill (London: Constable, 1990), p. 160.
43
See fort his argument the letter by Alice to Ludwig in: Noel, Princess Alice, pp. 223-225.
44
Eckhardt G. Franz, “Victorias Schwester in Darmstadt: Großherzogin Alice von Hessen und bei Rhein“,
in: Rainer von Hessen (ed.), Victoria Kaiserin Friedrich (1840-1901): Mission und Schicksal einer
englischen Prinzessin in Deutschland (Frankfurt/New York: Campus Verlag, 2002), p. 85. This argument is
supported by Alice Grand Duchess of Hesse, Princess of Great Britain and Ireland: Biographical Sketch
and Letters (New York/London: G. P. Putnam’s Sons, 1884), p. 400. According to this biographical sketch
Alice, who was just fifteen years old, “married the husband of her choice.”
45
For the emergence of these women’s associations see: Jean Quartaert, Staging Philanthropy: Patriotic
Women and the National Imagination in Dynastic Germany, 1813-1916 (Ann Arbor: The University of
Michigan Press, 2001).
41
18
as an essential part of her reform agenda. After 1872, however, Alice dedicated her life to
housing reform along the lines of Octavia Hill’s house management system.
Octavia Hill advocated not the creation of new tenement buildings but the
cleaning up of old ones and reeducation of the tenants. It was her fundamental conviction
“that the poor needed example, tuition, inspiration and guidance in their everyday lives
more than they needed charity.”46 However, Hill would never have been able to realize
her ideas without the support of John Ruskin who had been her employer and her friend.
Ruskin, a fierce critic of capitalism, who felt “temperamentally unable to deal personally
with poor people,” encouraged Octavia Hill to develop her ideas about the improvement
of living conditions for poor families.47 After Ruskin inherited a considerable amount of
money from his father in 1864, he approved Hill’s plan of purchasing three houses “in
one of the worst courts of Marylebone.”48 While Hill prepared a plan to clean up these
apartment buildings and to implement her system of friendly rent collecting and close
supervision and education of the tenants, Ruskin concerned himself with the financial
aspects of this undertaking. He, perhaps following Waterlow’s idea of combining
philanthropy with market mechanisms, convinced Hill that “it would be far more useful if
it could be made to pay; that a working man ought to be able to pay for his own house;
that the outlay upon it ought, therefore, to yield a fair percentage on the capital
46
Enid Gauldie, Cruel Habitations: A History of Working-Class Housing 1780-1918 (London: Allen &
Unwin, 1974), p. 214.
47
Nancy Boyd, Josephine Butler, Octavia Hill, Florence Nightingale: Three Victorian Women Who
Changed Their World (London and Basingstoke: The Macmillan Press, 1982), pp. 107-108.
48
Octavia Hill, “Organized Work Among the Poor; Suggestions Founded on Four Years’ Management of a
London Court”, in: Macmillan’s Magazine XX (May-October 1869), p. 219.
19
invested.”49 Hill agreed and went ahead to purchase the three houses in hear immediate
neighborhood for £750.
To manage the tenements in these three houses, Hill set up a management system
which included weekly visits and contacts with the tenants, insistence of punctual
payment of rent, strict standards of cleanliness for the communal parts of the houses and
the tenements. In order to avoid overcrowding of the apartments, Hill encouraged big
families to rent two instead of just one room “and for these much less was charged than if
let singly.”50 Subletting was strictly prohibited and tenants who did not follow the
instructions of Hill and her lady visitors or damaged the building were evicted.
Hill, like Waterlow, was never interested in small-scale reform projects. She
hoped to develop a model which could be followed by many others and would lead to a
tremendous improvement of living conditions for London’s poor. Therefore, Hill began
publishing articles in several English journals to propagate her ideas and successes
beginning already in 1866. The first article was published in the Fortnightly Review in
November 1866 but was actually sent to this journal six month earlier – in May 1866
(only about one year after Hill had bought the three houses).51 Many more articles
followed in Macmillan’s Magazine and the Nineteenth Century. These articles were later
combined into the volume Homes of the London Poor which was first published in
London in 1875.52 As a result of this publicity campaign, Hill found herself in charge of
Octavia Hill, “Cottage Property in London”, in: The Fortnightly Review VI (August 15-December 1,
1866), p. 682.
50
Hill, “Organized Work Among the Poor”, p. 220.
51
Hill, “Cottage Property in London”, p. 681.
52
Octavia Hill, Homes of the London Poor (second edition) (London: Macmillan and Company, 1883). For
her other writings see: The Befriending Leader: Social Assistance without Dependency. Essays by Octavia
Hill edited and with an Introduction by James L. Payne (Sandpoint/Idaho: Lytton Publishing Co., 1997);
Extracts from Octavia Hill’s “Letters to Fellow-Workers” 1864 to 1911 compiled by her niece Elinor
Southwood Ouvry (London: The Adelphi Bock Shop, 1933); House Property & its Management: Some
49
20
5,000 to 6,000 houses after a couple of years. She had become an icon of housing reform,
which attracted visitors from all of continental Europe and North America. Hill’s articles
were reprinted in the Journal de St. Petersbourg and Louisa Lee Schuyler who had
founded the State Charities Aid Association of New York (SCAA) organized the
publication of Hill’s Homes of the London Poor in New York in 1875. The copies of this
78 page work were sold by the SCAA for twenty-five cents each.53
During one of her visits to London, Alice arranged to meet Octavia Hill and to
take incognito a tour of the social housing projects administered by Hill in 1876. Alice
described her impressions from such a visit in a letter to her daughter: “With a charming
excellent lady Miss Octavia Hill … I have been this morning in some of the very poor
courts in London, garrets and streets … such quantities of little children and so many
living in one dirty room. It was sad to see them – on one way, but beautiful to see how
these ladies worked amongst them, knew them, did business with them. I have been
trying to see as much and learn as much as possible of what is done for the poor in every
way and have heard of such good and unselfish noble people…”54 Impressed by the
housing management system of Octavia Hill, Alice entered into an exchange of letters
with Hill to learn more about her concepts and visions. In late 1876, Alice finally
inquired if Octavia Hill would give her permission to translate her book The Homes of the
London Poor into German. Hill responded enthusiastically and even suggested that Alice
should write an introduction to the German translation. With the arrangement of the
Papers on the Methods of Management introduced by Miss Octavia Hill and adapted to Modern Conditions
(London: George Allen & Unwin, 1921).
53
Octavia Hill, Homes of the London Poor (New York, 1875) (Publications of the State Charities Aid
Association No. 8); Robert H. Bremner, “’An Iron Scepter twined with Roses’: The Octavia Hill System of
Housing Management”, in: Social Service Review 39 (1965), p. 227; Anthony S. Wohl, The Eternal Slum:
Housing and Social Policy in Victorian London (London: Edward Arnold, 1977), p. 181.
54
Letter quoted after Noel, Princess Alice, p. 221-222. See also: Darley, Octavia Hill, pp. 161-162.
21
translation of this book, Alice virtually occupied the position of a translator of Hill’s
methods into a German environment. This book appeared under the title of Aus der
Londoner Armenpflege in 1878 in Wiesbaden and became quickly the most influential
book on housing reform in Germany.55 Housing reformers such as Wilhelm Schwab
(Darmstadt) and Gustav de Liagre (Leipzig) used the German translation of Hill’s book
as guide books in their attempts to establish social housing enterprises following her
example.56
In 1883 Gustav de Liagre, inspired by the “tremendous success of Octavia Hill’s
endeavors in London,”57 purchased together with eleven friends two buildings with 240
rooms in Leipzig. Like Hill, Liagre did not construct new buildings, but purchased rundown buildings close to the inner city of Leipzig. He convinced eight men and three
women to each contribute 5,000 marks to this enterprise by promising them a four
percent return on their invested capital. He chose a building he was already acquainted
with from his time as a friendly visitor (Armenpfleger) during the 1870s. After acquiring
these tenement houses, Liagre insisted, like Hill, on basic improvements but did not add
any new appliances. His goal was to provide healthy and affordable small tenements for
poor families who had shared much larger apartments with other families before they
entered his housing complex. Liagre insisted on weekly rent-collection by lady-visitors,
compliance to certain cleanliness standards among the tenants and the ban on subletting
parts of these tenements. His enterprise received much attention among housing
55
Darley, Octavia Hill, 166-171; Noel, Princess Alice, pp. 222, 230; Alice Grandduchess of Hesse, pp.
358-359
56
For Schwab see: Stadtarchiv Darmstadt: Schwab, Wilhelm 1816-1891. For Liagre see: Thomas Adam,
Die Anfänge industriellen Bauens in Sachsen (Leipzig: Quadrat Verlag, 1998), pp. 27-28.
57
Gustav de Liagre, „Ein Versuch zur Beschaffung guter Wohnungen für Arme in Leipzig“, in: Ernst
Hasse, Die Wohnungsverhältnisse der ärmeren Volksklassen in Leipzig (Leipzig: Duncker & Humblot,
1886), p. 95.
22
reformers in Leipzig (Emma Hasse, Therese Rossbach, and Herrmann Julius Meyer) and
in other German cities. In his history of the Verein zur Verbesserung der kleinen
Wohnungen in Berlin (Association for the Improvement of small tenements in Berlin),
Paul Felix Aschrott pointed out that it even influenced the housing reform in Berlin.58
According to several sources, Liagre (Leipzig) and Schwab (Darmstadt) were probably
the first German housing reformers to replicate Hill’s management system in Germany.
In contrast to Schwab, however, Liagre gave several public talks in many German cities
and published accounts of his enterprise thus publicly showing that it was possible to
integrate Hill’s method into the German social and economic environment.59 Therefore, it
was not Schwab but Liagre who was soon regarded as the expert on Hill’s concepts.
While Alice remained anonymous – she signed the introduction to the German translation
of Octavia Hill’s book just with “A” – Liagre became a public figure who gained
extensive influence among philanthropists and housing reformers.
As the example of Octavia Hill and Alice already suggests, women played an
eminent role in housing reform and philanthropy. Philanthropy in return played an
important role in the emancipation of women. Since women were considered to be
caregivers it seemed acceptable for well-to-do women to engage in charitable and
philanthropic activities. As Frank Prochaska points out: “Whether casual or institutional,
58
Felix Paul Aschrott, 25 Jahre gemeinnützige Tätigkeit für Kleinwohnungen: Zum 25jährigen Bestehen
des Vereins zur Verbesserung der kleinen Wohnungen in Berlin, pp. 5-6.
59
Gustav de Liagre, Wohnungen für Unbemittelte: Vortrag des Herrn G. de Liagre aus Leipzig gehalten
am 4. Mai 1888 auf Veranlassung Ihrer Majestät der Königin von Sachsen als Protektorin des
Johannesvereins in Dresden (Leipzig: Bibliographisches Institut, 1888); Gustav de Liagre, Wohnungen für
Unbemittelte: Vortrag von Gustav de Liagre. Öffentlicher Abend der „:Sozial-Wissenschaftlichen
Vereinigung“ in Leipzig, am 21. November 1896 (Leipzig: Verlag von O. de Liagre, 1896); Gustav de
Liagre, „Ein Versuch zur Beschaffung guter Wohnungen für Arme in Leipzig“, in: Die Wohnungsnoth der
ärmeren Klassen in deutschen Großstädten und Vorschläge zu deren Abhülfe. Gutachten und Berichte
herausgegeben im Auftrage des Vereins für Socialpolitik (Leipzig: Verlag von Duncker & Humblot, 1886),
pp. 383-388.
23
charitable work was relatively free from the restraints and prejudices associated with
women in paid employments.”60 According to Anne M Boylan, women could and did
attribute their motivation to charitable work “to their sex’s special capacity for religion or
nurturance…”61 Religion taught Christians that women “had a rightful and important
place in the charitable world.”62 Either believing in this predestination or exploiting
social stereotypes to their advantage, women were applauded for their engagement in
public societies which offered assistance to the poor. However, by creating charitable
organizations, women not only engaged in social work and thus fulfilled an expectation
of their paternalistic society, but also claimed a specific social space of society their own.
Some contemporaries recognized that the philanthropic involvement of women went
potentially against nineteenth-century assumptions about women’s role in society. Henry
I. Bowditch, the Boston philanthropist who admired Octavia Hill’s engagement in
philanthropic housing felt compelled to remark in his famous Letter from the Chairman
that “What she has undertaken and has accomplished, most people would say was
entirely ‘out of woman’s sphere.’”63
Involvement in social philanthropy allowed bourgeois women to break free from
their everyday routine. It could be seen as a “leisured woman’s most obvious outlet for
self-expression,”64 as an undisputed way out of the household, and, subsequently as an
attempt at emancipation. Philanthropy, thus, was just the first step towards women’s
integration into the public sphere. By looking at the Russian example Richard Stites
60
Frank K. Prochaska, Women and Philanthropy in Nineteenth-Century England (Oxford, 1980), p. 6.
Anne M. Boylan, The Origin of Women’s Activism: New York and Boston 1797-1840 (Chapel Hill and
London: The University of North Carolina Press, 2002), p. 54.
62
Prochaska, Women and Philanthropy, p. 17.
63
Bowditch, “Letter from the Chairman”, p. 214.
64
Prochaska, Women and Philanthropy, p. 5
61
24
suggested that charity provided “experience in leadership, nurtured a feeling of selfrespect, and aroused a consciousness of women’s ability to function in public life. Most
important, these efforts brought together many women of similar backgrounds in new
situations that transcended the salons and the other established forms of social intercourse
that prevailed among ladies. Philanthropy blended easily into feminism, and in a short
time their efforts were pointed in the direction of helping other women to live, to study,
and to work.”65
An analysis of the gender distribution of the shareholders of the BCBC clearly
demonstrates that wealthy Bostonian women, independent of their marital status, did not
only financially support this social housing company; they also ran it. 66 William Gray
was chosen president of the BCBC and supported by a treasurer, a secretary and a board
of 19 directors. Remarkably, nine of the 19 directors were female and women held the
positions of the treasurer and the secretary. This reflected the large number of women
among the shareholders – 58 out of 163 (36%).67 Therefore, it should come as no surprise
that in the Act of Incorporation the company is represented by two men (William Gray
and Henry B. Rogers) and two women (Abby W. May and Anna Cabot Lodge).68 And
Boston was no exception. Wealthy women in Leipzig, Boston, New York and Toronto
financed not only social housing enterprises but also museums and art galleries. About 25
percent of all supporters of the Toronto Housing Company and about 30 percent of all
donors to the Royal Ontario Museum in Toronto were female. In some cases women even
Richard Stites, The Women’s Liberation Movement in Russia: Feminism, Nihilism, and Bolshevism,
1860-1930 (Princeton: Princeton University Press, 1978), p. 68.
66
The following analysis is based on the biographical data bases developed for my research project about
bourgeoisie and philanthropy in nineteenth-century America, Canadian, and German cities.
67
First Annual Report (BCBC), p. 3-4, 10. Page 16 and 17 contain a list of all shareholders of the
company.
68
Ibid., 10.
65
25
occupied eminent positions within the administration of these bodies. The Leipziger
“Ostheim” board of directors included seven women and nine men. The “Ostheim” was,
furthermore, the direct result of the engagement of one woman, Therese Rossbach, who
donated the land needed for the housing project – the initial act in the creation of this
association.69 Women, who represented 34 percent of all members, proved essential for
the financial support of this institution. The “Ostheim” was funded in three ways: 1) an
annual contribution of at least twenty Marks, 2) a donation of at least 1000 Marks, or 3)
the purchase of a share for 2000 Marks.70 While 19 women bought shares or made
donations totaling 201,000 Marks, 27 men contributed only 189,000 Marks.71 Simply,
women played a larger role in the financing of the “Ostheim” than men, and a far larger
role than their numbers might initially suggest. The largest contribution, 100 000 Marks,
was made by its founder, Therese Rossbach, whereas the largest contribution by a man
was only 40 000 Marks. As for those who chose to give annual contributions in 1904, 17
women contributed 340 Marks, while 46 men contributed 1,245 Marks.72 Of equal
importance, the three-tiered financing scheme (mentioned above) was linked to voting
privileges among the members: 1) those who contributed an annual amount of at least
twenty marks were entitled to one vote; 2) those who chose to donate money were given
one vote for every 1000 Marks donated, up to a maximum of 10 votes; 3) those who
bought shares for 2000 Marks were given a vote for each share, up to a maximum of 10
votes.73 This meant that the women involved (in 1904) had 72 votes, while men had 125
69
Ulrike König, Das Wirken des Architekten Arwed Rossbach in Leipzig im letzten Drittel des 19.
Jahrhunderts (unpublished Diplomarbeit, University of Leipzig 1988), p. 56, endnote 58.
70
Stadtarchiv Leipzig Kap. 35 Nr. 748, Geschäftsbericht des Vereins Ostheim Leipzig für das Jahr 1904
(Leipzig 1905), pp. 5-6.
71
Ibid.
72
Ibid, p. 6.
73
Ibid, p. 23
26
votes. Given the higher financial involvement of women (over fifty percent of donations
and shares sold), this voting system was unjust (37% representation for ca. 52% financial
contributions). However, it did give women a slightly higher representation within the
ranks of the association than would have been accorded if voting privileges had been
based in a purely democratic, on one person, one vote, scheme (37% compared with
30%).74
As the example of the Holstein Trust suggests, women not only contributed vast
amounts of money for collective philanthropic undertakings, but also created their own
foundations (individual philanthropy). Hedwig von Holstein, who was born in Leipzig in
1822 to a wealthy family, was an eminent Leipzig philanthropist.75 She was married to
the composer Franz von Holstein, but their financial security derived from her family
fortunes and not his. After the early death of her husband in 1878, Holstein engaged in a
variety of philanthropic enterprises. In 1891, she set up the Salomon Trust, a housing
foundation in the Eastern part of Leipzig intended for the working class. Von Holstein
used her own money (plus some from her mother and her sister) to found the housing
trust which she named after her father, Rudolf Julius Salomon, Salomon Stift.76 Between
1891 and 1900, three apartment buildings and one multi-purpose facility (including a
washhouse) were built surrounding a park. The apartment buildings were five storeys
Ibid, , pp. 5-6, 23; Bettina Kaun, „Der Architekt Max Arwed Rossbach und sein Wirken für Leipzig –
Eine Laudatio“, in Leipziger Kalender 1995, p. 156.
75
For her biography see: Martin Geck, „Nicht nur Komponisten Gattin: Hedwig von Holstein im
Musikleben ihrer Zeit“, in Klaus Hortschansky (ed.), Traditionen – Neuansätze. Für Anna Amalie Abert
(1906-1996) (Tutzing 1997), pp. 287-296 and Hedwig von Holstein, Eine Glückliche: Hedwig von Holstein
in ihren Briefen und Tagebuchblättern (Leipzig: H. Haeffel, 1922).
76
Archive of the Hochschule für Musik und Theater Leipzig, Holstein Stiftung I 2.5.1.; 2.5.3/2.; 2.5.4/2.
74
27
high had two or three entrances and connecting staircases. In total, there were 140
apartments.77
American and German social reformers favored collective philanthropy over
individual philanthropy. Although Henry I. Bowditch and Wilhelm Ruprecht, who
published the first German scholarly account of housing reform in London under the title
Die Wohnungen der arbeitenden Klassen in London (The tenements of the working
classes in London),78 praised the Peabody Trust for its successes, they also pointed out
that it was unsuitable for imitation. Only limited dividend companies, which promised a
five percent return on the invested capital, were considered a viable tool for providing
hygienic and affordable housing for working-class families. The two German social
reformers Wilhelm Ruprecht and Paul Felix Aschrott studied the Philanthropy and Five
Percent concept in 1883/84 and 1884/85 respectively and attempted to prove to their
German audience that it worked successfully. It is interesting to note that while Susannah
Morris argues that they rarely reached a five percent dividend, German nineteenthcentury observers always argued that these companies reached their intended goal of
guaranteeing a five percent annual return.79 These views of German social reformers
were echoed by American social reformers such as Marcus T. Reynolds. In his study The
Housing of the Poor in American Cities, Reynolds pleaded for the improvement of the
77
Archive of the Hochschule für Musik und Theater Leipzig, Holstein Stiftung I 2.5.1.; 2.5.3/2.; 2.5.4/2;
Leipzig und seine Bauten (Leipzig 1892), pp. 459-460; Bernard Riedel, „Gruppenbauten in und um
Leipzig“, in Leipziger Kalender 9 (1912), pp. 173-183; Robert Bruck, Arwed Rossbach und seine Bauten
(Berlin 1904), p. 71.
78
Wilhelm Ruprecht, Die Wohnungen der arbeitenden Klassen in London. Mit besonderer
Berücksichtigung der neueren englischen Gesetzgebung und ihrer Erfolge (Göttingen: Vandenhoeck und
Ruprecht’s Verlag, 1884).
79
Morris, “Market Solutions for social problems”, p. 538; Ruprecht, Die Wohnungen der arbeitenden
Klassen in London, p. 105-106; 79 Paul Felix Aschrott, “Die Arbeiterwohnungsfrage in England”, in: Die
Wohnungsnoth der ärmeren Klassen in deutschen Großstädten und Vorschläge zu deren Abhülfe.
Gutachten und Berichte edited by the Verein für Socialpolitik (Leipzig: Verlag von Duncker & Humblot,
1886), p. 133.
28
housing conditions of the poor by adapting “Philanthropy and Five Percent.” Arguing
from an economic point of view, Reynolds remarked that only “if it is clearly
demonstrated that a dividend of at least five per cent. will be forthcoming” wealthy
citizens could be convinced to invest their money in such housing enterprises. Housing
reform, in Reynolds interpretation, was not about charity but about the provision of
healthy and affordable living space for a fair rent which would allow for a limited return
on the invested capital. The guarantee of a five percent return would set an example and
attract other wealthy citizens to participate in these enterprises or to set up their own
social housing projects.80
Housing reformers on both sides of the Atlantic hoped to create a network of
housing companies which would attract philanthropists and investors alike. However,
most of the individuals who bought shares of the BCBC and the “Ostheim” behaved like
philanthropists and not like capitalists. By behaving too philanthropically these
philanthropists defeated the goals of Philanthropy and Five Percent advocates. Even
though the returns rarely reached their stated goal of seven percent, shareholders held on
to their shares and did not sell them. A seven percent return was paid only between 1871
and 1875, but between 1876 and 1889 “dividends were stopped or reduced to three
percent and earnings were invested.” In the 1890s dividends reached between five and six
percent.81 It is telling that despite these lower returns the investors maintained their
involvement in the enterprises. Obviously, making money was not their main concern.
This point is confirmed by the fact that unlike a truly capitalist and free-market company,
80
Marcus T. Reynolds, The Housing of the Poor in American Cities. The Prize Essay of the American
Economic Association for 1892 (Baltimore: Press of Guggenheim, Weil & Co. 1893), p. 107.
81
Robert Treat Paine, “The Housing Conditions in Boston”, in The Annals of the American Academy of
Political and Social Science Vol. XX (July, 1902-December, 1902) (Philadelphia, 1902), p. 125.
29
the stockholders in these philanthropic companies never sold their shares. In the case of
the BCBC, shares were transferable, but not available for purchase or sale.82 Further, we
have clear evidence that many of the shares (44%) were passed on from the original
stockholder to trustees (through last wills and testaments).83 There was a tacit agreement
(and in the case of the “Ostheim”, a written agreement) that the shareholder agreed never
to withdraw their support, regardless of the financial success of the venture. The founding
agreement of the “Ostheim” even gives the institution the right to decide when, if ever,
they were to repay the stockholders.84 This eradicated, in the end, the differences between
the limited dividend companies and the housing trusts. Philanthropists provided the
necessary funding in both cases and seemed not to expect revenue from it. Limited
dividend companies worked only in theory but not in practice.
III. Limited Dividend Companies and Cooperatives
Although German social reformers praised the advantages of limited dividend companies,
Philanthropy and Five Percent did not become as popular in Germany as in the United
States because of the different legal system (business law). In 1867, Prussia legally
recognized cooperatives as a legitimate form of business,85 and in 1889 the German
Reichstag passed the law about limited liability of companies (creation of the Society
82
Sixteenth Annual Report (BCBC), p. 22.
Forty-First Annual Report (BCBC), p. 8.
84
StadtArchiv Leipzig, Kap. 35 Nr. 748, Geschäftsbericht des Vereins Ostheim Leipzig für das Jahr 1904,
p. 61.
85
„Gesetz, betreffend die privatrechtliche Stellung der Erwerbs- und Wirthschafts-Genossenschaften vom
27. März 1867“, in Gesetzsammlung für die Königlich Preußischen Staaten Nr. 34, pp. 67ff.
83
30
with limited liability, G.m.b.H.).86 The law about limited liability allowed German
companies to choose this specific form of enterprise in order to assure that in the case of
bankruptcy, the stockholders were liable only to the amount of their share. Previously, the
entire fortunes of the members hung in the balance. Subsequently, wealthy Germans who
were interested in creating social housing enterprises yet did not want to do it alone chose
to form a cooperative with limited liability instead of a limited dividend company. This
situation may appear odd to those who associate cooperatives with self-help
organizations. Their original constitution, though, was such that wealthy people took the
initiative to create a cooperative. In most cases, lawyers, architects or civil servants
initiated and administered the cooperatives. The lower classes were involved as members
but did not have any say over the development of the cooperatives. The Dresden Savings
and Building Cooperative (founded in 1898) demonstrates this mixture of collective
philanthropy and cooperative self-help.87 Each member had to buy one share (300 Marks)
and, at the same time, this cooperative received financial support from leading members
of Dresden’s bourgeoisie and nobility, and from several enterprises. The Saxon King
contributed 1500 Marks, the distinguished businessman Eschebach gave 10,000 Marks
and Villeroy & Boch 2,000 Marks each year for a period of ten years. The cooperative
was, obviously, not financed by the shares sold to the members, but by donations given
by wealthy bourgeois of Dresden.88
Reichsgesetzblatt Nr. 11: „Gesetz, betreffend die Erwerbs- und Wirthschaftsgenossenschaften vom 1.
Mai 1889.“
87
For an historical account of the Dresdner Spar- und Bauverein see: Thomas Adam, 125 Jahre
Wohnreform in Sachsen: Zur Geschichte der sächsischen Baugenossenschaften (1873-1998) (Leipzig:
Antonym, 1999), pp. 91-101.
88
StadtArchiv Dresden, Y 346: Dresdner Spar- und Bauverein, Geschäftsbericht für das Jahr 1899.
86
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Of equal importance was the linking of housing cooperatives with credit unions,
first practiced in Hanover, which further integrated philanthropy and self-help. The
Hannover Spar and Bauverein (founded in 1885) differed from earlier cooperatives in
three ways: (1) it did not produce housing units which could be bought by its members
over time, instead the buildings remained permanently in the possession of the
cooperative; (2) it combined self-help with financial assistance from wealthy citizens by
merging the housing cooperative with a credit union; (3) it adopted the legal provision of
limited liability. This later provision encouraged middle and upper class citizens to invest
money into housing cooperatives since they were assured that they did not risk their
entire fortunes in case the enterprise defaulted.89 It was this legal change that allowed for
the successful combination of Philanthropy and Five Percent with Self-Help in Germany.
The Hanover housing cooperative established a credit union which guaranteed a four
percent annual return on all deposits. These deposits, however, were considered loans not
savings and provided the housing company with the necessary financial support to built
affordable and hygienic apartment buildings for working-class families.90 The merger of
housing cooperatives with credit unions sparked imitation in Berlin, Göttingen, Leipzig,
Dresden, and many other German cities.91 It represented the successful combination of
the two concepts of Self-Help and Philanthropy and Five Percent. This unique German
model of social housing allowed socially concerned citizens with limited resources to
participate in the housing reform by simply depositing their money with the credit unions
Wilhelm Ruprecht, „Gesunde Wohnungen:, in: Göttinger Arbeiterbibliothek vol. 1, No. 6, pp. 81-96;
Adam, 125 Jahre Wohnreform, pp. 37-39.
90
Ibid.; F. Bork, „Der Spar- und Bauverein, E.G.m.beschr. Haftpflicht in Hannover“, in: Die Spar- und
Bau-Vereine in Hannover, Göttingen und Berlin. Eine Anleitung zur praktischen Betätigung auf dem
Gebiete der Wohnungsfrage (Schriften der Centralststelle für Arbeiter-Wohlfahrtseinrichtungen Nr. 3)
(Berlin: Carl Heymann Verlag, 1893), pp. 1-93.
91
Ibid.
89
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attached to housing cooperatives and purchasing shares of these enterprises. In contrast to
British and American limited dividend companies, these credit unions were, at least until
the Second World War, even more successful in guaranteeing a steady return of four
percent.92
Advocating the imitation of such social housing enterprises, social reformers such
as Wilhelm Ruprecht, rejected any state support for cooperatives. Arguing against Paul
Lechler’s suggestion of large-scale state support for the creation of housing cooperatives,
Ruprecht suggested that the solution of the housing question could not be achieved by
simply providing a large number of apartments.93 Rejecting the idea that the housing
question was only an economic issue, Ruprecht argued that it had also a social and
cultural dimension. Of course, workers have to be in a position to afford the apartments
built for them. However, these workers also needeed, according to Ruprecht, education
and guidance in how to maintain the apartments. In Ruprecht’s view, many workers
seemed not to care for keeping the apartments in good shape and therefore could not be
entrusted with such improved housing conditions. These ideas closely reflect Octavia
Hill’s opinion on working class housing. Only after working-class families were trained
to maintain a certain level of cleanliness and care, did Hill consider them worthy of better
housing conditions. Both, Ruprecht and Hill saw the housing question as a financial and
educational project that can be accomplished only over a longer period of time.
Notwithstanding Ruprecht and Hill’s arguments, indirect and to certain degree
unintentional state support for housing cooperatives began already during the 1890s. The
92
See: Adam, 125 Jahre Wohnreform in Sachsen, pp. 134, 143-144.
Ruprecht, „Gesunde Wohnungen“, pp. 95-96; Paul Lechler, Wohlfahrtseinrichtungen über ganz
Deutschland durch gemeinnützige Aktiengesellschaften: Ein Stück sozialer Reform (Stuttgart: W.
Kohlhammer, 1892).
93
33
creation of state-sponsored pension and accident at the workplace insurance systems
(Bismarck’s Social Laws) produced an accumulation of capital from the insurance
contributions. The Law about Social Security (Invaliditäts- und
Altersversicherungsgesetz of June 22, 1889) decreed that the insurance systems were
allowed to give out loans to social housing companies, which produced small apartments
for lower income groups, at a fixed interest rate of three to four and a half percent. This
regulation made the state-sponsored insurance systems the most important provider of
loans for housing cooperatives. 68% of the total capital used by cooperatives in Saxony
to construct apartment buildings came from these insurance companies by 1911. This
financing scheme made the housing cooperatives the most important provider of social
housing in the first half of the twentieth century.94 However, the state did not intervene
directly in the housing market by providing social housing for low-income families. Even
after 1918, cooperatives and philanthropic housing enterprises produced a much higher
number of apartments than the municipalities. And even after 1945, East German housing
cooperatives remained an integral part of social housing provision. During the 1970s,
about half of all apartment buildings (Plattenbauten) constructed in East German cities
such as Dresden, Leipzig, and Halle were financed and built by housing cooperatives and
not the state for financial reasons.95
These German housing cooperatives differ significantly from housing
cooperatives in New York and Boston. The BCBC and similar undertakings in the United
94
Adam, 125 Jahre Wohnreform, p. 38/39, 50-51; Karl Eichhorn, Die sächsischen Baugenossenschaften
(Engelsdorf-Leipzig: C & M. Vogel, 1929), pp. 129-131; Rolf Greve, Wohnungsgenossenschaften und ihre
Konzernstrukturen (Institut für Genossenschaftswesen der Universität Münster), p. 31; Walter Vossberg,
Die deutsche Baugenossenschafts-Bewegung (Berlin: Unger, 1906), pp. 55f.; Helmut Walter Jenkis,
Ursprung und Entwicklung der gemeinnützigen Wohnungswirtschaft: eine wirtschaftliche und
sozialgeschichtliche Darstellung (Bonn: Domus, 1973), pp. 208ff.
95
Adam, 125 Jahre Wohnreform, p.107ff. Thomas Adam, Die sächsischen Wohnungsbaugenossenschaften
in der DDR (Leipzig: Antonym, 1997).
34
States were founded on the principles of Philanthropy and Five Percent. They are in name
only cooperatives since they excluded any form of self-help from the outset.
Interestingly, it was not an American housing cooperative that attempted to combine both
philanthropy and self help for the first time in North America, but a Canadian one. In
February 1912, representatives of Toronto’s Civic Guild, the Toronto Branch of the
Canadian Manufacturers’ Association, the board of Trade, the University Settlement, the
national Council of Women, and the City Council announced their intention to create a
limited dividend housing company. This company was to be founded upon the principles
of Philanthropy and Five percent as well as co-operation. Furthermore, it was expected
that the municipality would provide some support for this private company. In early
1913, the white-wear merchant and spokesman of Toronto’s business community, George
Frank Beer announced the founding of the Toronto Housing Company (THC) to the
public. The company was to build settlements inside the city limits but close to industrial
centers. The apartments were to be rented to tenants who “would own a minimum of five
shares (at $50 per share).”96 Following the example of Henry Vivian’s Ealing Tenants
Ltd. in West London, the very first British co-partnership housing scheme, outsiders were
allowed and invited to purchase shares. The dividends were limited to six percent.97 The
initial plan of selling shares to tenants on a co-partnership basis distinguished the Toronto
Housing Company from philanthropic housing companies in American cities, but brought
them closer to European models of social housing in both Great Britain and Germany.
While many of the British and German housing co-operatives were in fact financed by
Lorna F. Hurl, “The Toronto Housing Company, 1912-1923: The Pitfalls of Painless Philanthropy”, in:
Canadian Historical Review vol. LXV, No. 1 (March 1984), p. 35.
97
Ibid.; Shirley Campbell Spragge, The Provision of Workingmen’s Housing. Attempts in Toronto 19041920 (MA thesis Queen’s University Kingston, 1974), p. 117.
96
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tenants and outside investors alike, no such enterprises emerged in Boston, New York or
Philadelphia.98 However, the co-partnership/co-ownership idea was abandoned before
construction of the first apartment buildings began. Shirley Campbell Spragge considers
the quick dismissal of this innovative concept as puzzling but points to the criticism
voiced by the District Labour Council (DLC) in March of 1912. The DLC condemned
“the project as useless to workers because few could pay the $250 down payment
required …”99
98
For a discussion of the overlap between philanthropy and self-help in the European co-operative
movement see: Brett Fairbairn, “Self-Help and Philanthropy: The Emergence of Cooperatives in Britain,
Germany, the United States, and Canada from Mid-Nineteenth to Mid-Twentieth Century,” in: Adam,
Philanthropy, Patronage, and Civil Society, pp. 55-78.
99
Spragge, The Provision of Workingmen’s Housing, p. 118.
36