Brodsky sugar: How did a small-town family become one of the wealthiest in the empire?
Kyiv history specialist Mykhailo Kalnytsky reveals how the members of the Brodsky family earned a living and spent their earnings.
Host
Аndriy Kobalia
Guest
Мykhailo Kalnytsky
The Jewish businessman Meir Brodsky-Schor had five sons: Abram, Zelman, Isaac, Izrail, and Yosyp. One of them will inherit capital with which he will try to start his own business. At the age of 23 he will open his first factory in a small village. Within a couple of decades, he will become a sugar magnate, and many buildings that are now associated with Kyiv’s tourist image will be built with his money. Kyiv specialist Mykhailo Kalnytsky talks about assistance from Petrograd, patronage, and collaboration with the Ukrainian magnates Tereshchenko and Kharytonenko.
Mykhailo Kalnytsky: The first start-up capital came from the father, Meir (Mark). If I am not mistaken, Izrail Brodsky inherited around 40,000 rubles. At the time this was a considerable sum of money. Obviously, they obtained it on account of their trade and credit operations, like many Jews in Western Ukraine during this period. This is not to say that they earned immense wealth, but they were able to invest a certain amount of capital.
His rise to tycoon status and that of one of the wealthiest people in the empire was the result of the entrepreneurship of Izrail’s generation and the next one: Lazar and Lev Brodsky. By investing capital into the promising branch of beet sugar production, they acquired immense wealth.
Andriy Kobalia: Are we’re talking about the second half of the nineteenth century?
Mykhailo Kalnytsky: This is the mid-nineteenth century. The formation of this branch of industry in Ukraine began thanks to the activities of the well-known businessman and aristocrat Count Aleksei Bobrinsky, whose example was followed later by others. Izrail Brodsky owned a sugar factory in Lebedyn, and when he saw that the business was going well, he began buying up other factories. The Oleksandrivka Society of Sugar Mills was established around the 1870s and was considered the most influential in the empire.
Andriy Kobalia: From our Ukrainian history course in school we know that several families were involved in the sugar industry during this period. Why was this business so promising?
Mykhailo Kalnytsky: Before sugar began to be cultivated thanks to the abundant sugar beet crop, it was necessary to import sugar from colonial countries. This was often cane sugar. If you go to a store today, you see that cane sugar is still three times more expensive than beet sugar. Beet sugar production was also widespread in Europe. It may have been even more active and economical there. It is not quite correct to say that the empire supplied sugar to Europe. This was a surplus, and this was done so as not to scale back factory work. The spread of this business in the western reaches of the empire coincided with the post-reform period, when it became necessary to occupy lands and people who were unable to engage in agriculture. These were the very people who were hired for sugar production.
This business expanded, and sugar was produced mainly for domestic demand. Ukrainian sugar was delivered to the Urals and beyond. The surplus was sold in Europe, but our sugar could not withstand competition because it was more expensive. So the state, in order to protect the national industry, compensated some of the losses incurred by those who agreed to sell their sugar in Europe. This was quite a clever system. However, this does not change the fact that an immense quantity of sugar was produced in our territories. It formed the economy of the land and the situation on the stock market.
Andriy Kobalia: The Brodskys are immediately associated with Kyiv. Later we will be talking about how this family influenced the architecture of the city. But right now, I would like to ask how the Brodskys ended up in Kyiv. They did not come here for a few days, like most Jews, I think. They settled down here and built a huge business. We remember the Pale of Settlement, which existed in the empire. Not all Jews were able to live in Kharkiv and Kyiv, for example; nor in the majority of territories in the Russian Empire.
Mykhailo Kalnytsky: In order to answer this question, it is crucial to mention the legislation of this period. The gubernia itself was part of the Pale, where Jews could live in cities and towns; they were exceptions in villages. However, in 1827 Tsar Nicholas I excluded Kyiv because it was the “mother of all Russian towns,” claiming that it was an all- Russian shrine, and Jews should not live there. But during the reign of Alexander II, Nicholas’s successor, other laws were passed, making the Pale transparent—but not for everyone.
At first, Jewish merchants of the first guild were allowed to live freely beyond the Pale of Settlement, together with their families and minimal network. Later, this regulation was applied to retired soldiers of the tsarist army, people with a higher education, and licensed tradesmen. Of course, the Brodskys were big businessmen, who had the status of first-guild merchants. Thus, the Pale seemed not to exist for them.
Moreover, it was at Lev Brodsky’s request that special clarifications were introduced into the legislation especially for the Brodskys, allowing Jews to purchase real estate in Kyiv in any part of the city. The situation was that in the late 1850s–early 1860s special regulations governing Jewish settlement were introduced in Kyiv, which stated that Jews who, in keeping with the law, had the right to live outside the Pale of Settlement, could live anywhere in Kyiv. But Jews who could live here only temporarily had to live within the boundaries of two police stations, Lybidska and Ploska, closer to the Pale, past Shchekavytsia Hill and Yurkavytsia Hill; in other words, in the direction of Kurenivka. These were not very prestigious areas, and Jews without rights were moved there. The Kyiv authorities said that if that was the case, then Jews could purchase real estate only within the boundaries of these areas. Brodsky submitted a complaint because he wanted to buy a residential building in the Lypky neighborhood, in the mansion district. He argued that since the law did not exclude Kyiv from the general list of imperial cities and Jewish merchants of the first guild enjoyed the full extent of the law, why did he have to limit himself to purchasing real estate in Kyiv? The law was on his side, and the Senate of the Russian Empire granted this right to the Jews.
Unfortunately, not everything that Brodsky built survived. In the central part of the city, on city blocks close to downtown, we can mention the Choral Synagogue, which is often called the “Brodsky Synagogue.” It was built with funds provided by Lazar Brodsky in 1898, and it opened on Lazar’s fiftieth birthday. Next to it, where the Kinopanorama Cinema used to stand until recently, was a rebuilt synagogue. Today it is barely recognizable, but it was founded by Lev Brodsky, Lazar’s brother. Next to it is the Bessarabian Market; to a significant extent this large and beautiful brick structure is connected with the memory of Lazar Brodsky.
It is said that Brodsky bequeathed the money with which the market was built. To be accurate, the situation there was a bit more complicated. He did indeed bequeath 500,000 rubles to the city. At the time, this was an incredible sum, with which the elegant market that we have was built. But he set a condition that from the sum of 500,000, 4.5 percent be deducted from the market’s revenues for charitable, mostly Jewish, institutions that he had already founded. Kyiv was supposed to accept this obligation for all time, but the authorities balked. What if the market burned down? What if the situation changed, but the obligation was perpetual? There was a caveat in Brodsky’s last will and testament: If the city refused, then the money had to be converted to securities at a rate of 4.5 percent, and this money was also earmarked for charitable institutions. The market was opened, which was disgraceful for Kyiv because smells and anti-sanitary conditions spread from there to the central street, Khreshchatyk. At the time Kyiv was issuing debt bonds in order to resolve its problems. The city borrowed money, not in perpetuity, just for a specific term. One of Lazar Brodsky’s executors, Goldenberg, proposed a different solution. The city would announce a loan for 500,000 rubles, and the executors would buy it up. These funds could then be invested immediately into the construction of the market.
Throughout the tenure of the loan, the city settled up with those who had bought the bonds. The loan was supposed to mature in sixty years, and the city would be released from its obligations. This variant suited everyone. The Kyiv budget may have saved over 100,000 rubles because there were no expenditures connected with the loan. At the time this was a huge sum for the city. Sometime in 1907 plans were drawn up, the construction began, and it was opened in 1912. So, it is likely that without Brodsky’s last will and testament, we would not have that beautiful, covered Bessarabian Market.
Andriy Kobalia: If we are talking about patronage and early twentieth-century history, I must mention cases of individual businessmen who engaged in philanthropy, if not to clean up their image, then at least to create a more positive image among the city residents. Can one say that the history of the Brodskys is not that rosy? Were there conflicts among them? What was behind their philanthropy?
Mykhailo Kalnytsky: I must direct attention to the fact that in the Jewish religion patronage is a duty of devout Jews; the concept of tzedakah. As a rule, nearly ten percent of one’s income is supposed to be donated to good causes. If we look at Izrail Brodsky, who was the leader of the Kyivan branch until his death in 1888, people said that he often helped people and donated money, and he tried to conceal that he was the one doing this. In other words, there was no special effort to enhance his image, even though everyone knew that he willingly donated money to good causes. He was the builder of the initial complex of the magnificent Jewish Hospital. It was founded earlier, but the complex arose on the site of the present location of the oblast hospital. It started out as the Jewish Hospital, funded by Izrail, then Lazar and other Jewish entrepreneurs.
Among the donations that had nothing to do with the Jewish sphere, one can mention the Bacteriological Institute. With funds donated by Lazar Brodsky, a special corpus of the Institute was built in the vicinity of Baikova Street and Batyieva Hora. This building is still in use today. Lazar contributed a lot to the construction of the Troitsky People’s Building, which was once a center of Ukrainian culture and served as the premises of the Sadovsky Theater. But its history began with Lazar Brodsky, who was the biggest patron. Lev financed the Commercial College. All of them, as well as the Tereshchenkos and the Kharytonenkos, took part in creating the KPI [Kyiv Polytechnic Institute]. Lazar was the biggest supporter of this idea. When wealthy Kyivan entrepreneurs discussed in private the issue of the KPI, they gathered at Lazar’s home before submitting it for the government’s consideration.
Andriy Kobalia: In any period when there is big business—for example, sugar in those days—key entrepreneurs were acquainted with each other, of course. Today, big oligarchs can telephone each other and talk. Perhaps there was a similar story in those days. Can we speak of cooperation between these Jewish and Ukrainian business groups?
Mykhailo Kalnytsky: The representatives of the Brodskys, the Tereshchenkos, and the Kharytonenkos were members of the board of the All-Russian Union of Sugar Producers, the Kyiv Stock Exchange Committee, and the Council of the Kyiv Bureau of the State Bank. They socialized with each other everywhere and developed a common, constructive policy.
Andriy Kobalia: You mentioned several generations: Izrail, his sons, and Lazar and Lev. The latter two are from the first years of the previous century. Is this the last generation of the Brodsky entrepreneurs? Then the First World War starts.
Mykhailo Kalnytsky: Lev closed the Oleksandrivka Association; the business functioned without him. There was Yosyp and his children. But this huge trust ceased to exist in the last years of Lev’s life, although he continued to work in the banking sphere. Here I must mention that banking and industrial capital were rather closely linked. As early as 1898, when the Choral Synagogue was being opened, one of the first marriages—following the Jewish tradition of the chuppah—was contracted between Klara, the daughter of Lazar Brodsky, and the son of the famous St. Petersburg banker, Ginzburg. That’s how the Brodskys and the Ginzburgs became related. They were related to the Poliakovs and the Rosenbergs, and to other clans of bankers and businessmen. As late as 1918 there was a saying: “Tea—Wissotzky, sugar—Brodsky, and Russia—Trotsky.” But the sugar trust was not absolutely definitive for the Brodsky family. They also invested in the banking sphere. As we can see, Lev Brodsky had many business dealings, and they were always quite wide-ranging.
Andriy Kobalia: Neither Lazar nor Lev had sons; that’s why the Brodsky name disappeared from the economic life of Europe. Lev Brodsky lived to see the start of the First World War and the revolution. He emigrated in 1918 and spent the last years of his life in Paris. The state on whose territory his family had created an empire ceased to exist, and the Bolshevik government nationalized the companies and various businesses.
This program was made possible by the Canadian non-profit organization Ukrainian Jewish Encounter.
Originally appeared in Ukrainian (Hromadske Radio podcast) here.
Translated from the Ukrainian by Marta D. Olynyk.
Edited by Peter Bejger.
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