Who financed the Red Cross ?

Sanford J. Mock

Published in print (with additional illustrations) in ‘Scripophily’, the journal of the International Bond & Share Society, May 1996

Copyright ã International Bond & Share Society 2001

The world knows that the International Red Cross was founded in 1863 by a charitable, socially conscious, deeply religious Swiss businessman, Jean Henri Dunant. What the world does not know (or at least this enquirer cannot find out) is how the Red Cross and Red Crescent societies in the various countries were financed.

Solferino, 1859

The story of the Red Cross goes back to one of the most horrendous battles in history, which took place on June 24 1859 near the northern Italian village of Solferino in the province of Verona. The combatants were the French and Italian armies, under command of Napoleon III, and the defeated troops of the Austrian Empire. Forty thousand of those who fought hand to hand in that sixteen-hour bloody struggle were killed or wounded. There was no medical aid for the injured and dying. A night without shelter or water killed many who might otherwise have survived. Without antiseptics and antibiotics, even a small wound could lead to agonising death from infection.

Aged 31, Henri Dunant had come to seek business concessions from Napoleon III but instead was witness to the slaughter, an event which changed his life. Unable to stand idly by, Dunant organised volunteers to care for nine thousand wounded from both sides who were brought afterwards, parched by dehydration, to the town of Castiglione. The untrained Italian women nurses feared the Austrian foreigners, but Dunant persuaded them : ‘Tutti fratelli, tutti fratelli’ - ‘they are all brothers’.

In 1862, writing ‘Un souvenir de Soferino’, Dunant not only described in vivid terms the disaster of the battlefield, but he broached the unique concept of forming relief societies in time of peace. Volunteers could be organised and trained, ready to aid the wounded on all sides in time of war. Since wars had always been fought with little or no consideration for the wounded, Dunant’s idea was radical. A scholar of the day commented : ‘In a few terrifying, realistic pages all the horrors of mass slaughter were exposed. The impact on philanthropic circles was electric. It shook the whole of Europe.’

The Geneva Convention

Henri Dunant and a ‘Committee of Five’ prominent citizens of Geneva convened in February 1863 to put Dunant’s vision into motion. Later that year, delegates from sixteen countries met in Geneva and in 1864 the ‘Geneva Convention for the Amelioration of the Condition of Wounded in Armies in the Field’ was agreed.

The Geneva convention established neutrality for ambulances, hospitals and medical workers, including local inhabitants helping the wounded. Volunteers would be considered as neutrals ; they would not wear uniforms but rather emblems showing they were present only to aid the wounded. The Geneva red cross on a white background was chosen as the international symbol of protection and assistance.

Each participating government was to provide support for its own national committee. By the end of 1864 ten nations had formally approved participation, and by 1867 there were 21 member nations.The British Red Cross Society was founded in 1870 and the American in 1881. In 1879 Turkey adopted a red crescent as the symbol of the society there. Henri Dunant died in 1910, before the great conflict of World War I, whose luckless participants were to benefit so much from his vision half a century earlier.

Financing the Red Cross

These historic events are well chronicled. What remains obscure is how the various Red Cross and Red Crescent societies were financed and financially supported. We know that some of the societies issued bonds and I have identified six issues :

Society Issue date Life Denomination Number offered

Austria 1882 51 years 10 gulden 600,000

Hungary 1882 51 years 5 forint 800,000

Italy 1885 51 years 25 lire 600,000

Serbia 1907 75 years 20 gold zloty 1,000,000

Bulgaria 1912 65 years 20 gold leva 300,000

Austria 1916 40 years 20 kronen 2,000,000

The first of these was the Austrian bond issued on July 1 1882, followed by the Hungarian on December 15 of that year. They were all lottery bonds and the terms were broadly similar. Instead of receiving interests, the bonds were entered into periodic prize draws, and the redemption of the capital (probably by instalments) was also decided by lot. The rules printed on some of the bonds show that the winners of an ‘interest’ prize were excluded from future draws. Likewise, winners of capital redemptions continued to participate in ‘interest’ draws.

Some of the issues were guaranteed by the state. The Serbian issue was secured on 4% 1895 Serbian state bonds deposited at the National Bank in Belgrade. All were issued under the patronage of the appropriate royal family. Payments to holders were generally made at the relevant national bank. However, payments on the Italian bond could be made in eight Italian cities and also in Vienna, Budapest, Trieste, Paris, Brussels, Geneva, Basel and Bern, which (together with its being printed in French and German as well as Italian) implies that the bonds were marketed across Europe.

Questions

These bonds provoke questions. How widely marketed were they, and were they fully subscribed ? Were they redeemed ? Fully ? Partially ? When did the last draws take place (the Serbian bond was theoretically still valid in 1982) ? How did the terms compare with commercial terms on bonds at the time ? Did the buyers subscribe mainly for investment, or for gambling or charitable reasons ? Were other bonds issued by these same societies ? Are there other bonds from other countries ? How were the societies financed before these bonds were issued ?

This writer has not been able to obtain any information from the American Red Cross, the International Red Cross in Washington DC or the Henri Dunant Society in Geneva. Maybe it would be easier if one could read Bulgarian. European collectors and dealers, please help !

Copyright ã INTERNATIONAL BOND & SHARE SOCIETY 2001

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