The Jewish community has outgrown this antisemitic trope, but Sam Bankman Fried's current legal peril epitomizes the "fall of the Jewish gangster"

The Fall of the Jewish Gangster

Antisemitism has always partly been driven by envy; Jews attract a unique resentment for their disproportionate intellectual achievements in literature, science, education and, particularly, finance. At the same time, however, this success can be inverted. Historian Fred Siegel calls this “the flip side of cleverness”, a tendency among some to apply their minds to illegal activities.

In the first decades of the last century, Arnold Rothstein, described by one social historian as “the JP Morgan of the underworld”, is widely regarded as the founder of American organised crime. Later Bernard Madoff, Sam Bankman-Fried as well as the odious Jeffrey Epstein and Harvey Weinstein have carried on this grim tradition, albeit with usually less lethal means.

Today, America’s most prominent malefactors are more those of privilege than products of mean streets. Their evolution is epitomised by Bankman-Fried, a graduate of MIT, who was described by the Jerusalem Post as the product of “an upper-middle class family of Jewish academics”, raised in a $4 million home near Stanford amid the elite culture of Silicon Valley. Like many would-be tech moguls, Bankman-Fried revelled in his “outsider” image — as demonstrated by his pervasively sloppy dress code — but he was also an insider whose large contributions to the Democrats won him access to White House officials even as FTX was collapsing around him.

The complex nature of Jewish economic life was shaped by history. With their homeland destroyed by the Romans in AD70, Jews, already scattered throughout the Mediterranean world, were forced to employ their smarts and connections to survive. Once Christianity became the state religion, Jews faced greater restrictions, eventually barring them from most economic activities and service in the government or army. They were, notes historian Yuri Slezkine, “a cohesive tribe of professional strangers”, as opposed to most peasants, who were not literate, knew little about how the cash economy worked and often lived their entire lives within a relatively small perimeter. With the rise of capitalism, however, these habits born of exclusion turned out to be advantageous, as originally observed by both a sympathetic Max Weber and more hostile Werner Sombart. Jews may not have been the originators of capitalism, but as the Jewish historian Ellis Rivkin has argued, they were “best positioned to benefit”.

It also helped that Jews were literate, sometimes in more than one language, with contacts and family dispersed across numerous geographies. Before the Holocaust, Jews made up the vast majority of Eastern Europe’s factory owners, bankers, lawyers and physicians. By the 1880s, Jews accounted for a bare 4% of the population of the Austrian Empire, but comprised 40% of Vienna’s gymnasium students, a pattern seen throughout Eastern Europe. They also dominated the professions and the stock exchanges. A handful rose to prominence as global banking families, most obviously the Rothschilds, who played a preeminent role in the rise of the modern European and then North American economies.

Yet such success led some to suggest Jews were by nature manipulative and dishonest, a view common among European Christians for most of the last two millennia. Two dominant archetypes emerged in terms of Jewish image — one elevated, the other despised. “From Moses the lawgiver to Madoff the shyster”, writes University of Michigan historian Jeffrey Veidlinger. “Jews have figured prominently in European myth for some 2,000 years.” They were seen either as unmatched moral exemplars or “feared and despised as imagined worshippers of the Anti-Christ, political conspirators, financial manipulators, child murderers, and threats to racial purity”.

In reality, like any ethnic group under assault, some felt compelled to break the law. As early as the 10th and 11th centuries, Jewish leaders worked to fight criminals in their communities, most urgently when the scams inspired antisemitism from outside. But Jews also sometimes were persuaded to protect those who ran afoul of secular governments, in part due to the clear antisemitic bias of such regimes. Jews arriving in America or Britain, argued historian Irving Howe, entered a new environment that was more free but they still carried attitudes from their past. “The Torah tells us to do business honestly and follow the rules of the country,” notes Rabbi David Eliezrie, a prominent Chabad author and intellectual. “But we all too often lived in countries where the rules were impossible to follow.”

Not surprisingly, Jewish community leaders have tended to downplay the criminal element of their tribe. It’s understandable that they prefer to focus instead on Jews’ extraordinary portion of Nobel Prizes (accounting for well over 20% of all winners between 1901 and 2022 while comprising just 0.2% of global population) than engage in discussions about gangsters and schemers. The Holocaust has also tended to dominate community consciousness, given the impact on many of our families. But focusing on Jews largely as martyrs and moral exemplars constitutes, as the author Dara Horn notes, a preference, if you will, for dead Jews — as long as they provide “a service to mankind” — over living ones. Martyrdom and intellectual achievement have been elevated as the centrepieces of Jewish identity, says Steven Windmueller, a professor emeritus at the Hebrew Union College-Jewish Institute of Religion in Los Angeles, but “there’s an embarrassment about economic success”.

Read the rest of this piece at UnHerd.

Joel Kotkin is the author of The Coming of Neo-Feudalism: A Warning to the Global Middle Class. He is the Roger Hobbs Presidential Fellow in Urban Futures at Chapman University and Executive Director for Urban Reform Institute. Learn more at and follow him on Twitter @joelkotkin.

Homepage photo: Bybit via Flickr under CC 2.0 License.