Monthly Archives: August 2019

Barney Barnato: Boxer, Actor, Diamond Magnate

I’m fascinated by rivalries and there are some good ones at the end of the 19th century. In the USA Social Darwinism dominated and justified the actions of Henry Clay Frick and Andrew Carnegie. Their partnership transformed America with the founding of what became US Steel.

Also in the late 1800’s and more than 8,000 miles away in the backdrop of a burgeoning diamond industry, people were traveling to South Africa in search of opportunity and wealth. Most of them were English, including the two that emerged as the dominant figures: Barney Barnato and Cecil Rhodes. They were competitors, friends, and enemies. I have a particular interest in the lesser known Barnato, who started as a penniless street performer in London and became a millionaire mining magnet within ten years of arriving to South Africa. He was the only man Rhodes ever feared. Like Frick and Carnegie, Rhodes and Barnato were dependent on each other to achieve success which ultimately led to amalgamating the Kimberley and De Beers diamond mines to form the De Beers Consolidated Mining Ltd.

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Barnato was born Barnett Isaacs. His father taught him how to box as soon as he could walk and at age 13 he dropped out of school and worked miscellaneous jobs, including vaudeville acts with his brother Henry. When it came time for applause Henry would enthusiastically take the limelight and the crowd would shout “Barney too” and so the stagename Barnato stuck and they became Henry and Barney Barnato or the Barnato Brothers. There were other reduplicated names in the family, the father, a clobberer (sold second hand fabrics and clothes)  was a called Isaac Isaacs and there was a cousin called Joel Joel.

Barney and Henry first heard about the diamond rush from a cousin in 1872 and soon Henry left to seek his fortune at the Kimberley mine in South Africa. Barney followed a few months later in the summer of 1873. He traveled by steamship arriving in Cape Town from London after 27 days, and then walked 621 miles for 2 months to the diamond fields. He described this part of the journey as “one of the jolliest time I have ever had. The accommodations consisted of permission to walk alongside a wagon when it moved, and to sleep under it when it stopped. I made my fieriest acquaintance with mealy porridge and biltong (corn cakes and sundered antelope) and have a keen relish for both still. I have not been very well or bright for some months before leaving England, but the wagon journey, or rather tramp over the veld, put me right…”

Barnato was to become one of the most colorful people in Kimberly; much of his success lay in the fact that he was such a character and people simply enjoyed doing business with him. He was short, noisy, brash, near-sighted, and quick-witted. While he was building a reputation for himself as a kopje-wallaper (small time diamond buyer), he took up boxing gigs with Payne’s Traveling Circus and other companies to subsidize his income. Barney was very proud of his boxing skills. He also acted a bit. He earnestly performed the works of Shakespeare, and it amused some audience members that a 5’3 man with a cockney accent should be playing Othello or Hamlet. In one such performance Barney jumped off stage for a moment and knocked out a spectator for laughing. Barnato had sporadic success of buying diamonds from diggers at the lowest possible price (sealing all transactions with a cheap, stale cigar) and selling at the highest possible price. He first collaborated with his brother and later with Louis Cohen, who Barney met a bar in Kimberley after a fly landed on Louis’ nose and in an attempt to swat at it he scattered his bowl of soup across the bar. In these early days Barney made mistakes. He was largely unfamiliar with uncut diamonds or their value. One plan that paid off for a short while was the purchase of an old horse from another kopje-walloper leaving South Africa. The horse followed the route of his previous owner, allowing for new locations and introductions purchase cheap diamonds. His business dealings progressed and failed in undulation and it wasn’t long before Barney realized there needed to be a central body controlling the price of diamonds.

By 1876 Barney purchased four claims at the Kimberly mine, the maximum allotment at the time was 10. It seemed a terrible time to making new purchases because most of the yellow ground was gone.  (Yellow ground is limonite, an iron-rich rock that’s also the host rock of turquoise.) Kimberley natives believed the diamonds were only scattered in yellow ground so when it started running out many claim holders gave up their claims. While it was geologically unknown at the time, Barnato believed the bulk of the diamonds lay below yellow ground in blue ground, an igneous rock now known as kimberlite. Year after year Barnato purchased more claims until in 1887 he owned 40% of the Kimberley mine.

Enter Cecil Rhodes. His friends called him the Colossus which is no doubt in reference to the enormous statue of the Greek sun-god Helios on the island of Rhodos, also known as the Colossus of Rhodes which stood for about 60 years (280-226 BC) at almost 100′ before being destroyed by an earthquake. In fact Cecil felt he was a god and he was described by political theorist, Hannah Arendt as someone who could “do nothing wrong, what he did became right.” Because there is so much written about Cecil Rhodes’ I’ll only mention the highlights which are that he was one of 12 children born to a poor English vicar, he arrived in South Africa at age 17 in 1870 and within 2 years he was financially independent. He returned to England for an education at Oxford, founded the De Beers Consolidated Mining Ltd., years later he was elected Prime Minister to South Africa. He died at 48 years old and left the bulk of his money in an endowment to Oxford to fund scholarships in his name, The Rhodes Scholarships.

Cecil Rhodes
The Colossus of Rhodes

Like Frick and Carnegie, both Rhodes and Barnato have rags-to-riches stories. Both men started their businesses as  kopje-wallapers, both had a head for large financial undertakings, both men wanted to be rich,  both men saw the need for the larger claimholders to dominate the lesser claimholders and ultimately to amalgamate all the mines.

It is on this point of amalgamating the mines and controlling the world’s diamond supply that Rhodes and Barnato became enemies. In 1887 Rhodes gathered financial partners including Nathaniel Rothschild to fund the purchase of all the claims in the De Beers mine. Meanwhile, Barnato continued buying claims at Kimberley. There was however, another major shareholder at the Kimberley mine, the French Company, and when Rhodes made a bid to purchase all the French Company’s shares, Barnato sensed a take-over and urged the shareholders to hold out for more money. Rhodes encouraged Barnato to abandon his own interests of amalgamation and worked to negotiate a compromise: Rhodes would purchase the French Company’s shares and sell it to Barnato’s company, Kimberley Central, making Barney’s company the dominant holder of the Kimberley mine, and Rhodes would retain 1/5 stake in the purchase of shares. At this point in Barnato’s life it can’t be overstated how desperately he wanted to be taken seriously and accepted in local gentlemanly society, despite his youthful clowning around and propensity to walk in to the Savoy in London on is hands! Knowing this about Barnato, Rhodes combined his financial offer with a promise to secure him a membership to the restricted and exclusive Kimberley Club. Barnato couldn’t refuse the enticement and finally agreed to the amalgamation of the two mines. Unfortunately it took over 2 years for another member of the club to second Barnato’s nomination of membership.

Barney died at the age of 46. The details of the his death are unknown except to say that he fell off or was perhaps pushed off an ocean liner near Madeira, Portugal.

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