Heinrich Carl von Schimmelmann
Encyclopedia
Heinrich Carl von Schimmelmann (13 July 1724 – 16 February 1782) was a German
-born Danish
nobleman, merchant and statesman.
. Since education was scarce, it was von Schlimmelmann's force of personality that brought him success, although his ways are still unclear. Von Schlimmelmann started out as a merchant himself, learning the trade in Stettin. Soon thereafter he set up a supplies store in Dresden
. On 4 March 1747, at the age of 23, he married then 17-year-old Caroline Tugendreich Friedeborn, furthering his career. By 1755, von Schlimmelmann was responsible for tariff collection in Kursachsen. This enabled him to assume control of deliveries to the Prussian army during King Frederick the Great
's Seven Years' War
against Saxony
.
After having made his fortune in war, von Schimmelmann moved to Hamburg
in 1759 and bought the Ahrensburg
estate in Holstein
. Here, the head of the Danish government, Count von Bernstorff
, realized how von Schimmelmann's talents as a merchant could benefit the state of Denmark during those times of financial duress. Von Schimmelmann on his own part benefited from the connection with the Danish government both due to Denmark's neutrality being beneficial for trade, and for reasons of prestige. Negotiations soon led to Schimmelmann being appointed as second in command to the Danish attaché in Hamburg, and the connection with Denmark was solidified by buying property in Copenhagen
and Jutland
. He was also appointed Baron
and received the Order of the Dannebrog
.
The financial state in Denmark at the time was dire, due to the large army of 20-25.000 soldiers stationed in Holstein, the rearmament following the coronation of Peter III of Russia
in 1762, and because it was hard for the state to get loans at the time. Denmark had tried to get funds through seignorage , but this destabilized both the state and the banks responsible. Lacking men of financial capacity, Schimmelmann's talents and reputation was utilized to get favorable loans from abroad to keep the Danish state and financial system afloat. In the years 1762-1765, Schimmelmann continued his work of securing the Danish government, sometimes even through loans of his own.
in September 1762. It would have been too difficult at the time to create a progressive
income tax
, but the brutality of the poll tax led to civil unrest. However, it secured the state finances and stabilized the financial markets.
An advisory board was created in December 1762 with von Schimmelmann as a member, through which he became de facto administrator of Denmark's taxes and deficit. With short interruptions, this influence over the state's finances continued until his death.
and a sugar refinery in Copenhagen for 400,000 rigsdaler
. The plantations used slave labor from the Danish trading stations in present-day Ghana
. Through the work of von Schimmelmann's son Ernst Heinrich von Schimmelmann
among others, slave trade was banned in 1792 (effective from 1803). Schimmelmann also bought the Hammermøllen
rifle factory north of Helsingør from the government for 70.000 Rigsdaler in 1768.
However, the goal of his public endeavors was mostly the development of foreign trade. When Schimmelmann sought after a trade surplus, he thought it was especially important for a country like Denmark, where fiat money
was the only means of payment. Through trade, one could avoid a weakening (depreciation
) of the currency compared to other countries. Besides, the development of trade would improve domestic wealth and thus also the tax revenue and state finances.
He became connected with this important endeavor when he on 7 March 1767 was made deputy of the College of Commerce, and later in December, when he was given a seat in the newly-formed Trade Balance Commission, which was supposed to investigate the state’s finances and trade balance. Before Schimmelmann, other traders based in Copenhagen had realized that due to Denmark’s lack of naturally exportable goods, it was necessary to start intermediary trade with overseas goods as compensation. This, among other factors, led to the formation of the Danish East India Company
. Schimmelmann wanted to further this by establishing a free port
in Copenhagen, which probably would have been accomplished had it not been for the influence of Johann Friedrich Struensee
.
Schimmelmann had 9 children with his wife, 6 sons and 3 daughters. The oldest child was his son Ernst Heinrich von Schimmelmann
, who followed in father's footsteps, becoming both Minister of Finance and Minister of Foreign Affairs.
Besides his extensive career, von Schimmelmann enjoyed an excellent social life. His wife understood how to host great parties in the couple’s winter home in Copenhagen, with royally approved masquerades. The summers were spent in the splendid castle Ahrensburg
in Holstein
. His circle of friends included the Danish statesmen with Bernstorff the Elder
as the center, with whom he agreed on other political subjects. For example, Schimmelmann co-negotiated an agreement settling the Gottorp Question on 27 May 1768 between Hamburg
on one side, and Denmark and Gottorp
on the other, where the Holstein-Gottorp territories of Schleswig-Holstein were taken over by the King.
, with whom he also traveled abroad in 1768. His influence on the King was mostly due to the King’s respect for von Schimmelmann’s knowledge of trade and finance, and the King consulted with Schimmelmann on many occasions, e.g. regarding how much the country could spend on the army. Schimmelmann gained greater influence than Bernstorff ever could, and so it was von Schimmelmann, that convinced the King to banish the notorious prostitute Støvlet-Cathrine from Copenhagen in 1768.
Besides reflecting his personal abilities, Schimmelmann’s influence also shows the importance of money. In this context, it was unfortunate that he both served the role as financial advisor and made money by serving as a bank and lender for the state. The possible conflict of interests was often pointed out by his enemies, as he used his official position to earn money as a trader. Even though he in no way cheated the state, this still put him in a bad light
came to power in 1770. As the insane King’s physician, Struensee came to be de facto
regent
, and deposed many of the statesmen besides Schimmelmann, before finally being overthrown and executed in 1772. Schimmelmann, however, was still valuable to the new men in power, and so decided to work with the new leaders to salvage what he could of his old policies, as well as securing his own personal business endeavors. He succeeded beyond all expectations due to the goodwill of Struensee and his fellows, who made him a member of a commission established on 28 December 1770 with the purpose of settling the main economic questions of the day. His wife also made good use of the new political climate, becoming close friends with Struensee’s lover, Queen Caroline Matilda
.
Von Schimmelmann’s favorable position with Struensee influenced his relationship with former statesmen like Bernstorff once they came back into power. Schimmelmann, however, had a personal dislike for Struensee, who on his part wanted to sever the ties with Schimmelmann once possible. In the spring of 1771, Schimmelmann began withdrawing from his financial ties with the state. In the same year, the Treasury and the College of Commerce were closed down as the state financial system was being restructured to accommodate those in power, so Schimmelmann’s influence was diminished. However, careful as he was, Schimmelmann never completely severed the ties with either Struensee or the old circle of power, and thus retained his place in the limelight.
After the fall of Struensee, the King’s half-brother Frederick
was made Regent
, with his mother, Queen Juliana Maria
and minister Ove Høegh-Guldberg
as de facto
rulers. The turnover of power enabled Schimmelmann to wield influence once again. Formally, his power was in his position as member of the Tax Board, and a seat in an extraordinary financial committee created in October 1772. The Treasury was reinstated on 3 July 1773, with Schimmelmann as its director. Furthermore, Schimmelmann was awarded the Order of the Elephant
in 1773, and was made Count in 1779.
The records of the time reflect Schimmelmann’s broad influence. At the start, he made sure that A. P. Bernstorff
(Bernstorff the Younger) was reinstated and made head of the German Chancellery, and that Adolph Sigfried von der Osten
was removed from the State Council in the spring of 1773. Furthermore, he facilitated the King’s divorce from his unfaithful queen. Schimmelmann and Bernstorff the Younger were quite close, and Schimmelmann was often consulted in financial matters. A result of this was the nationalization of the Bank of Copenhagen
in March 1773, which came under the Tax Board, and thus under Schimmelmann’s personal leadership until his death.
Meanwhile, Schimmelmann had great influence in the state’s finances even though he did not have a seat on the College of Finance, admiringly reflected in Bernstorff the Younger’s letters about his absolute leadership over the state’s fixed expenses and influence on other colleges. Writes Bernstorff: “Schimmelmann is the soul in everything that happens in the internal affairs of the State. Even when decisions are made without him, it is as if he hastened their execution”.
Naturally, Schimmelmann would not be able to wield this kind of influence unopposed, and it was only possible due to the support given to him by the de facto rulers, Queen Juliana Maria and minister Høegh-Guldberg. Once again, those in power had great appreciation for Schimmelmann’s financial abilities, and he knew how to stay on good terms with them.
was carried through in the age of Guldberg, both with regards to industry and trade, even to the extent that the state became involved in shipbuilding, fishing and overseas trade. It was decided that the government should begin fishing to a great extent in the northern seas, capturing whales and seals. These activities were connected with the royal trade with then-colonies Greenland
and Iceland
, which required large-scale investments in shipbuilding. Although Guldberg showed great enthusiasm for these projects, it was Schimmelmann who was responsible for the government’s attitude towards them, due to Schimmelmann’s great influence over Guldberg and in every aspect of the state’s finances.
This was also the case for another important decision, which was thought to be very important for trade, namely the excavation of the so-called Eider Canal in Schleswig-Holstein, connecting the Baltic Sea
and the North Sea
using stretches of the Eider River
, which was completed in 1784.
.
in 1773 in the long run led to inflation
due to the unhealthy temptation of printing money whenever the state needed it. The ways in which he allowed the state to intervene in the economic activities of the day had negative effects already in his lifetime.
Germany
Germany , officially the Federal Republic of Germany , is a federal parliamentary republic in Europe. The country consists of 16 states while the capital and largest city is Berlin. Germany covers an area of 357,021 km2 and has a largely temperate seasonal climate...
-born Danish
Denmark
Denmark is a Scandinavian country in Northern Europe. The countries of Denmark and Greenland, as well as the Faroe Islands, constitute the Kingdom of Denmark . It is the southernmost of the Nordic countries, southwest of Sweden and south of Norway, and bordered to the south by Germany. Denmark...
nobleman, merchant and statesman.
Early life and career
His father was a merchant in DemminDemmin
Demmin is a town in the Mecklenburgische Seenplatte district, Mecklenburg-Western Pomerania, Germany. It was the capital of the former district Demmin.- Name :...
. Since education was scarce, it was von Schlimmelmann's force of personality that brought him success, although his ways are still unclear. Von Schlimmelmann started out as a merchant himself, learning the trade in Stettin. Soon thereafter he set up a supplies store in Dresden
Dresden
Dresden is the capital city of the Free State of Saxony in Germany. It is situated in a valley on the River Elbe, near the Czech border. The Dresden conurbation is part of the Saxon Triangle metropolitan area....
. On 4 March 1747, at the age of 23, he married then 17-year-old Caroline Tugendreich Friedeborn, furthering his career. By 1755, von Schlimmelmann was responsible for tariff collection in Kursachsen. This enabled him to assume control of deliveries to the Prussian army during King Frederick the Great
Frederick II of Prussia
Frederick II was a King in Prussia and a King of Prussia from the Hohenzollern dynasty. In his role as a prince-elector of the Holy Roman Empire, he was also Elector of Brandenburg. He was in personal union the sovereign prince of the Principality of Neuchâtel...
's Seven Years' War
Seven Years' War
The Seven Years' War was a global military war between 1756 and 1763, involving most of the great powers of the time and affecting Europe, North America, Central America, the West African coast, India, and the Philippines...
against Saxony
Electorate of Saxony
The Electorate of Saxony , sometimes referred to as Upper Saxony, was a State of the Holy Roman Empire. It was established when Emperor Charles IV raised the Ascanian duchy of Saxe-Wittenberg to the status of an Electorate by the Golden Bull of 1356...
.
Connection with Denmark
Hamburg
-History:The first historic name for the city was, according to Claudius Ptolemy's reports, Treva.But the city takes its modern name, Hamburg, from the first permanent building on the site, a castle whose construction was ordered by the Emperor Charlemagne in AD 808...
in 1759 and bought the Ahrensburg
Ahrensburg
Ahrensburg is a town in Schleswig-Holstein, Germany. It is part of the Hamburg Metropolitan Region, situated in Stormarn. Its population around 31,700 . Its outstanding sight is the Renaissance castle dating from 1595....
estate in Holstein
Holstein
Holstein is the region between the rivers Elbe and Eider. It is part of Schleswig-Holstein, the northernmost state of Germany....
. Here, the head of the Danish government, Count von Bernstorff
Count Johann Hartwig Ernst von Bernstorff
Count Johann Hartwig Ernst von Bernstorff , Danish statesman, who came of a very ancient Mecklenburg family, was the son of Joachim Engelke von Bernstorff, Chamberlain to the elector of Hanover.-Early political career:...
, realized how von Schimmelmann's talents as a merchant could benefit the state of Denmark during those times of financial duress. Von Schimmelmann on his own part benefited from the connection with the Danish government both due to Denmark's neutrality being beneficial for trade, and for reasons of prestige. Negotiations soon led to Schimmelmann being appointed as second in command to the Danish attaché in Hamburg, and the connection with Denmark was solidified by buying property in Copenhagen
Copenhagen
Copenhagen is the capital and largest city of Denmark, with an urban population of 1,199,224 and a metropolitan population of 1,930,260 . With the completion of the transnational Øresund Bridge in 2000, Copenhagen has become the centre of the increasingly integrating Øresund Region...
and Jutland
Jutland
Jutland , historically also called Cimbria, is the name of the peninsula that juts out in Northern Europe toward the rest of Scandinavia, forming the mainland part of Denmark. It has the North Sea to its west, Kattegat and Skagerrak to its north, the Baltic Sea to its east, and the Danish–German...
. He was also appointed Baron
Baron
Baron is a title of nobility. The word baron comes from Old French baron, itself from Old High German and Latin baro meaning " man, warrior"; it merged with cognate Old English beorn meaning "nobleman"...
and received the Order of the Dannebrog
Order of the Dannebrog
The Order of the Dannebrog is an Order of Denmark, instituted in 1671 by Christian V. It resulted from a move in 1660 to break the absolutism of the nobility. The Order was only to comprise 50 noble Knights in one class plus the Master of the Order, i.e. the Danish monarch, and his sons...
.
The financial state in Denmark at the time was dire, due to the large army of 20-25.000 soldiers stationed in Holstein, the rearmament following the coronation of Peter III of Russia
Peter III of Russia
Peter III was Emperor of Russia for six months in 1762. He was very pro-Prussian, which made him an unpopular leader. He was supposedly assassinated as a result of a conspiracy led by his wife, who succeeded him to the throne as Catherine II.-Early life and character:Peter was born in Kiel, in...
in 1762, and because it was hard for the state to get loans at the time. Denmark had tried to get funds through seignorage , but this destabilized both the state and the banks responsible. Lacking men of financial capacity, Schimmelmann's talents and reputation was utilized to get favorable loans from abroad to keep the Danish state and financial system afloat. In the years 1762-1765, Schimmelmann continued his work of securing the Danish government, sometimes even through loans of his own.
Influence on tax policies
To better the state's finances, Heinrich Carl von Schimmelmann decided on an extraordinary poll taxPoll tax
A poll tax is a tax of a portioned, fixed amount per individual in accordance with the census . When a corvée is commuted for cash payment, in effect it becomes a poll tax...
in September 1762. It would have been too difficult at the time to create a progressive
Progressive tax
A progressive tax is a tax by which the tax rate increases as the taxable base amount increases. "Progressive" describes a distribution effect on income or expenditure, referring to the way the rate progresses from low to high, where the average tax rate is less than the marginal tax rate...
income tax
Income tax
An income tax is a tax levied on the income of individuals or businesses . Various income tax systems exist, with varying degrees of tax incidence. Income taxation can be progressive, proportional, or regressive. When the tax is levied on the income of companies, it is often called a corporate...
, but the brutality of the poll tax led to civil unrest. However, it secured the state finances and stabilized the financial markets.
An advisory board was created in December 1762 with von Schimmelmann as a member, through which he became de facto administrator of Denmark's taxes and deficit. With short interruptions, this influence over the state's finances continued until his death.
Private business
Besides his duties as overseer of Denmark's taxes, von Schimmelmann also ran his own private business, having bought the Danish sugar plantations in the Danish West IndiesDanish West Indies
The Danish West Indies or "Danish Antilles", were a colony of Denmark-Norway and later Denmark in the Caribbean. They were sold to the United States in 1916 in the Treaty of the Danish West Indies and became the United States Virgin Islands in 1917...
and a sugar refinery in Copenhagen for 400,000 rigsdaler
Danish rigsdaler
The rigsdaler was the name of several currencies used in Denmark until 1873. The similarly named Reichsthaler, riksdaler and rijksdaalder were used in Germany and Austria-Hungary, Sweden and the Netherlands, respectively....
. The plantations used slave labor from the Danish trading stations in present-day Ghana
Ghana
Ghana , officially the Republic of Ghana, is a country located in West Africa. It is bordered by Côte d'Ivoire to the west, Burkina Faso to the north, Togo to the east, and the Gulf of Guinea to the south...
. Through the work of von Schimmelmann's son Ernst Heinrich von Schimmelmann
Ernst Heinrich von Schimmelmann
Ernst Heinrich von Schimmelmann was a German-Danish politician, businessman and patron of the arts. His father was Heinrich Carl von Schimmelmann.-Early life and career:Ernst von Schimmelmann was born in Dresden...
among others, slave trade was banned in 1792 (effective from 1803). Schimmelmann also bought the Hammermøllen
Hammermøllen
Hammermøllen was a set of water mills at Hellebæk in Denmark, used to power the Kronborg weapons factory. The first mill on the site was built in 1576, but it was only linked to weapons production from 1601, when the gun foundry was built nearby...
rifle factory north of Helsingør from the government for 70.000 Rigsdaler in 1768.
However, the goal of his public endeavors was mostly the development of foreign trade. When Schimmelmann sought after a trade surplus, he thought it was especially important for a country like Denmark, where fiat money
Fiat money
Fiat money is money that has value only because of government regulation or law. The term derives from the Latin fiat, meaning "let it be done", as such money is established by government decree. Where fiat money is used as currency, the term fiat currency is used.Fiat money originated in 11th...
was the only means of payment. Through trade, one could avoid a weakening (depreciation
Depreciation
Depreciation refers to two very different but related concepts:# the decrease in value of assets , and# the allocation of the cost of assets to periods in which the assets are used ....
) of the currency compared to other countries. Besides, the development of trade would improve domestic wealth and thus also the tax revenue and state finances.
He became connected with this important endeavor when he on 7 March 1767 was made deputy of the College of Commerce, and later in December, when he was given a seat in the newly-formed Trade Balance Commission, which was supposed to investigate the state’s finances and trade balance. Before Schimmelmann, other traders based in Copenhagen had realized that due to Denmark’s lack of naturally exportable goods, it was necessary to start intermediary trade with overseas goods as compensation. This, among other factors, led to the formation of the Danish East India Company
Danish East India Company
The Danish East India Company was a Danish chartered company.-History:It was founded in 1616, following a privilege of Danish King Christian IV....
. Schimmelmann wanted to further this by establishing a free port
Free port
A free port or free zone , sometimes also called a bonded area is a port, port area or other area with relaxed jurisdiction with respect to the country of location...
in Copenhagen, which probably would have been accomplished had it not been for the influence of Johann Friedrich Struensee
Johann Friedrich Struensee
Count Johann Friedrich Struensee was a German doctor. He became royal physician to the mentally ill King Christian VII of Denmark and a minister in the Danish government. He rose in power to a position of “de facto” regent of the country, where he tried to carry out widespread reforms...
.
Personal life
Ernst Heinrich von Schimmelmann
Ernst Heinrich von Schimmelmann was a German-Danish politician, businessman and patron of the arts. His father was Heinrich Carl von Schimmelmann.-Early life and career:Ernst von Schimmelmann was born in Dresden...
, who followed in father's footsteps, becoming both Minister of Finance and Minister of Foreign Affairs.
Besides his extensive career, von Schimmelmann enjoyed an excellent social life. His wife understood how to host great parties in the couple’s winter home in Copenhagen, with royally approved masquerades. The summers were spent in the splendid castle Ahrensburg
Ahrensburg
Ahrensburg is a town in Schleswig-Holstein, Germany. It is part of the Hamburg Metropolitan Region, situated in Stormarn. Its population around 31,700 . Its outstanding sight is the Renaissance castle dating from 1595....
in Holstein
Holstein
Holstein is the region between the rivers Elbe and Eider. It is part of Schleswig-Holstein, the northernmost state of Germany....
. His circle of friends included the Danish statesmen with Bernstorff the Elder
Count Johann Hartwig Ernst von Bernstorff
Count Johann Hartwig Ernst von Bernstorff , Danish statesman, who came of a very ancient Mecklenburg family, was the son of Joachim Engelke von Bernstorff, Chamberlain to the elector of Hanover.-Early political career:...
as the center, with whom he agreed on other political subjects. For example, Schimmelmann co-negotiated an agreement settling the Gottorp Question on 27 May 1768 between Hamburg
Hamburg
-History:The first historic name for the city was, according to Claudius Ptolemy's reports, Treva.But the city takes its modern name, Hamburg, from the first permanent building on the site, a castle whose construction was ordered by the Emperor Charlemagne in AD 808...
on one side, and Denmark and Gottorp
Gottorp
Gottorf Castle is a castle and estate in the city of Schleswig, Schleswig-Holstein, Germany. It is the ancestral home of the Holstein-Gottorp branch of the House of Oldenburg...
on the other, where the Holstein-Gottorp territories of Schleswig-Holstein were taken over by the King.
Relationship to Christian VII
Due to his many-faceted political influence, Schimmelmann came into close contact with the mentally-ill King Christian VIIChristian VII of Denmark
Christian VII was King of Denmark and Norway and Duke of Schleswig and Holstein from 1766 until his death. He was the son of Danish King Frederick V and his first consort Louisa, daughter of King George II of Great Britain....
, with whom he also traveled abroad in 1768. His influence on the King was mostly due to the King’s respect for von Schimmelmann’s knowledge of trade and finance, and the King consulted with Schimmelmann on many occasions, e.g. regarding how much the country could spend on the army. Schimmelmann gained greater influence than Bernstorff ever could, and so it was von Schimmelmann, that convinced the King to banish the notorious prostitute Støvlet-Cathrine from Copenhagen in 1768.
Besides reflecting his personal abilities, Schimmelmann’s influence also shows the importance of money. In this context, it was unfortunate that he both served the role as financial advisor and made money by serving as a bank and lender for the state. The possible conflict of interests was often pointed out by his enemies, as he used his official position to earn money as a trader. Even though he in no way cheated the state, this still put him in a bad light
Age of Struensee
During von Schimmelmann’s rising influence, StruenseeJohann Friedrich Struensee
Count Johann Friedrich Struensee was a German doctor. He became royal physician to the mentally ill King Christian VII of Denmark and a minister in the Danish government. He rose in power to a position of “de facto” regent of the country, where he tried to carry out widespread reforms...
came to power in 1770. As the insane King’s physician, Struensee came to be de facto
De facto
De facto is a Latin expression that means "concerning fact." In law, it often means "in practice but not necessarily ordained by law" or "in practice or actuality, but not officially established." It is commonly used in contrast to de jure when referring to matters of law, governance, or...
regent
Regent
A regent, from the Latin regens "one who reigns", is a person selected to act as head of state because the ruler is a minor, not present, or debilitated. Currently there are only two ruling Regencies in the world, sovereign Liechtenstein and the Malaysian constitutive state of Terengganu...
, and deposed many of the statesmen besides Schimmelmann, before finally being overthrown and executed in 1772. Schimmelmann, however, was still valuable to the new men in power, and so decided to work with the new leaders to salvage what he could of his old policies, as well as securing his own personal business endeavors. He succeeded beyond all expectations due to the goodwill of Struensee and his fellows, who made him a member of a commission established on 28 December 1770 with the purpose of settling the main economic questions of the day. His wife also made good use of the new political climate, becoming close friends with Struensee’s lover, Queen Caroline Matilda
Caroline Matilda of Wales
Caroline Matilda of Great Britain was Queen of Denmark and Norway from 1766 to 1772 and a member of the British Royal Family.-Early life:...
.
Von Schimmelmann’s favorable position with Struensee influenced his relationship with former statesmen like Bernstorff once they came back into power. Schimmelmann, however, had a personal dislike for Struensee, who on his part wanted to sever the ties with Schimmelmann once possible. In the spring of 1771, Schimmelmann began withdrawing from his financial ties with the state. In the same year, the Treasury and the College of Commerce were closed down as the state financial system was being restructured to accommodate those in power, so Schimmelmann’s influence was diminished. However, careful as he was, Schimmelmann never completely severed the ties with either Struensee or the old circle of power, and thus retained his place in the limelight.
Age of Guldberg
After the fall of Struensee, the King’s half-brother Frederick
Frederick, Hereditary Prince of Denmark and Norway
Frederick , was a Hereditary Prince of Denmark and Norway. He was the surviving son of the second marriage of King Frederick V of Denmark with Juliana Maria of Braunschweig-Wolfenbüttel....
was made Regent
Regent
A regent, from the Latin regens "one who reigns", is a person selected to act as head of state because the ruler is a minor, not present, or debilitated. Currently there are only two ruling Regencies in the world, sovereign Liechtenstein and the Malaysian constitutive state of Terengganu...
, with his mother, Queen Juliana Maria
Juliana Maria of Brunswick-Wolfenbüttel
Duchess Juliane Marie of Brunswick-Wolfenbüttel , , was queen of Denmark between 1752 and 1766, second consort of king Frederick V of Denmark and Norway, mother of the prince-regent Hereditary Prince Frederick of Denmark and Norway and herself de facto regent 1772–1784.- Early life and queen :Born...
and minister Ove Høegh-Guldberg
Ove Høegh-Guldberg
Ove Høegh-Guldberg was a Danish statesman, historian and de facto prime minister of Denmark, 1772–1784.-Biography:...
as de facto
De facto
De facto is a Latin expression that means "concerning fact." In law, it often means "in practice but not necessarily ordained by law" or "in practice or actuality, but not officially established." It is commonly used in contrast to de jure when referring to matters of law, governance, or...
rulers. The turnover of power enabled Schimmelmann to wield influence once again. Formally, his power was in his position as member of the Tax Board, and a seat in an extraordinary financial committee created in October 1772. The Treasury was reinstated on 3 July 1773, with Schimmelmann as its director. Furthermore, Schimmelmann was awarded the Order of the Elephant
Order of the Elephant
The Order of the Elephant is the highest order of Denmark. It has origins in the 15th century, but has officially existed since 1693, and since the establishment of constitutional monarchy in 1849, is now almost exclusively bestowed on royalty and heads of state.- History :A Danish religious...
in 1773, and was made Count in 1779.
The records of the time reflect Schimmelmann’s broad influence. At the start, he made sure that A. P. Bernstorff
Andreas Peter Bernstorff
Andreas Peter Bernstorff was a Danish statesman and politician. He was a Danish minister, father of Christian Günther von Bernstorff, and a guardian of civil and political liberty.-Background and early career:A. P...
(Bernstorff the Younger) was reinstated and made head of the German Chancellery, and that Adolph Sigfried von der Osten
Adolph Sigfried von der Osten
Count Adolph Sigfried von der Osten was a Danish diplomat of German descent. His father was Jacob Frants von der Osten , whose family was Pomeranian. Adolph was born in Denmark and backed Danish nationalism. Christian VI of Denmark paid for him to travel abroad and he was cared for by Carl Adolph...
was removed from the State Council in the spring of 1773. Furthermore, he facilitated the King’s divorce from his unfaithful queen. Schimmelmann and Bernstorff the Younger were quite close, and Schimmelmann was often consulted in financial matters. A result of this was the nationalization of the Bank of Copenhagen
Kurantbanken
The Kurantbanken was a Danish-Norwegian private limited company set up in Copenhagen in 1736, when it received its royal oktroj or charter...
in March 1773, which came under the Tax Board, and thus under Schimmelmann’s personal leadership until his death.
Meanwhile, Schimmelmann had great influence in the state’s finances even though he did not have a seat on the College of Finance, admiringly reflected in Bernstorff the Younger’s letters about his absolute leadership over the state’s fixed expenses and influence on other colleges. Writes Bernstorff: “Schimmelmann is the soul in everything that happens in the internal affairs of the State. Even when decisions are made without him, it is as if he hastened their execution”.
Naturally, Schimmelmann would not be able to wield this kind of influence unopposed, and it was only possible due to the support given to him by the de facto rulers, Queen Juliana Maria and minister Høegh-Guldberg. Once again, those in power had great appreciation for Schimmelmann’s financial abilities, and he knew how to stay on good terms with them.
Mercantilism
The effect of this cooperation shone through on the trade policy of the time. Thus, it was at this time that the protectionist system of mercantilismMercantilism
Mercantilism is the economic doctrine in which government control of foreign trade is of paramount importance for ensuring the prosperity and security of the state. In particular, it demands a positive balance of trade. Mercantilism dominated Western European economic policy and discourse from...
was carried through in the age of Guldberg, both with regards to industry and trade, even to the extent that the state became involved in shipbuilding, fishing and overseas trade. It was decided that the government should begin fishing to a great extent in the northern seas, capturing whales and seals. These activities were connected with the royal trade with then-colonies Greenland
Greenland
Greenland is an autonomous country within the Kingdom of Denmark, located between the Arctic and Atlantic Oceans, east of the Canadian Arctic Archipelago. Though physiographically a part of the continent of North America, Greenland has been politically and culturally associated with Europe for...
and Iceland
Iceland
Iceland , described as the Republic of Iceland, is a Nordic and European island country in the North Atlantic Ocean, on the Mid-Atlantic Ridge. Iceland also refers to the main island of the country, which contains almost all the population and almost all the land area. The country has a population...
, which required large-scale investments in shipbuilding. Although Guldberg showed great enthusiasm for these projects, it was Schimmelmann who was responsible for the government’s attitude towards them, due to Schimmelmann’s great influence over Guldberg and in every aspect of the state’s finances.
This was also the case for another important decision, which was thought to be very important for trade, namely the excavation of the so-called Eider Canal in Schleswig-Holstein, connecting the Baltic Sea
Baltic Sea
The Baltic Sea is a brackish mediterranean sea located in Northern Europe, from 53°N to 66°N latitude and from 20°E to 26°E longitude. It is bounded by the Scandinavian Peninsula, the mainland of Europe, and the Danish islands. It drains into the Kattegat by way of the Øresund, the Great Belt and...
and the North Sea
North Sea
In the southwest, beyond the Straits of Dover, the North Sea becomes the English Channel connecting to the Atlantic Ocean. In the east, it connects to the Baltic Sea via the Skagerrak and Kattegat, narrow straits that separate Denmark from Norway and Sweden respectively...
using stretches of the Eider River
Eider River
The Eider is the longest river of the German state of Schleswig-Holstein. The river starts near Bordesholm and reaches the southwestern outskirts of Kiel on the shores of the Baltic Sea, but flows to the west, ending in the North Sea...
, which was completed in 1784.
Death
By the end of the 1770’s, Schimmelmann’s health started to decline. Although he still found comfort in his work, it hurt him to see that his high hopes for Denmark’s finances were disappointed as the country was hit by inflation, and when A. P. Bernstorff was fired in 1780. Heinrich Carl von Schimmelmann died - as the richest man in Denmark - in Copenhagen on 15 February 1782, at the age of 58. He is buried in Wandsbeck outside of HamburgHamburg
-History:The first historic name for the city was, according to Claudius Ptolemy's reports, Treva.But the city takes its modern name, Hamburg, from the first permanent building on the site, a castle whose construction was ordered by the Emperor Charlemagne in AD 808...
.
Legacy
Although always a merchant with an eye for his own advantage, Schimmelmann was dutiful in his work for his adopted country Denmark. From the first years after moving to Denmark, he gained great honors by saving the country from a dire financial situation, and later exhibiting extraordinary skills in many other areas. His legacy has been attacked – not without justification – because the state takeover of the Bank of CopenhagenKurantbanken
The Kurantbanken was a Danish-Norwegian private limited company set up in Copenhagen in 1736, when it received its royal oktroj or charter...
in 1773 in the long run led to inflation
Inflation
In economics, inflation is a rise in the general level of prices of goods and services in an economy over a period of time.When the general price level rises, each unit of currency buys fewer goods and services. Consequently, inflation also reflects an erosion in the purchasing power of money – a...
due to the unhealthy temptation of printing money whenever the state needed it. The ways in which he allowed the state to intervene in the economic activities of the day had negative effects already in his lifetime.