Us on facebook at cspan history. Coming up on American History tv, from the 33rd International Churchill conference, david lough talks about his book no more champagne churchill and his money. A retired banker and historian, mr. Lough argues the former Prime Minister would borrow heavily from his friends and family to maintain his lifestyle and was often living on the edge of financial ruin. This is about an hour. David, thank you very much and a very good afternoon. Ladies and gentlemen, welcome to the last session of today, one that i know will end the first day on a high. I am sure you, as i, marvel at the continuing volume of books about Winston Churchill that emerge year after year. What more could there be to say now, even about Winston Churchill, we might ask . David lough has managed not only to say new things but to add great detail and provide a fascinating exposition of churchills finances, a topic as you know, and as david demonstrates, that had its peaks and indeed its troughs, much like churchills own political career. Davids book is thorough and engaging and offers new churchillian epithets. One of my favorites taken from his volume sees churchill seeking new funds for yet another expenditure and lamenting, had i not been so foolish as to pay a lot of bills, i shouldve had the money available right now. [laughter] david lough is well qualified to write on this topic, a former member of the london stock exchange, a fellow of the chartered securities institute, and with a career in private banking. Now in semiretirement, the world of finances loss is the world of churchills gain. Ladies and gentlemen, david lough. [applause] mr. Lough thank you very much, rob, and thank you to the International Churchill society, as i must learn to call it again, for inviting me here this afternoon. There has been a lot of talk about this being the final session, so those of you who have come to it, thank you very much. I think we will keep it quite light, it being the final session. We have been here a long time today already. Fortunately, this is a subject that i think has to be taken quite lightly. Although i guess churchill never took it that lightly himself. He said he hated money was the only thing that worried him in life. He hated business affairs. And if you read speaking for themselves the collection of his letters to clementine, money is a worry throughout his life, almost up to the end, when he when it probably did not need to be, but it was. It was never quite so that as my title no more champagne might imply. It was of course a publishers title. I want to reassure you, i dont think there was ever no more champagne literally in churchills life. [laughter] mr. Lough it did in march of 1938, when his Financial Affairs were about to implode, he was reduced to saying, no more champagne is to be served to guests. [laughter] mr. Lough but he reserved for himself one imperial pint a day. I dont know whether you voted for brexit, sir, you are applauding. One of the first things that has happened since the surprising brexit vote is that they have announced they will bring back the imperial pint bottle of champagne. Now [applause] mr. Lough to business to business, as churchill would reluctantly say. David gave me this title, churchills financial team. I suppose as an englishman, i am always thinking of teams in units of 11. Because these games that we pretend as englishman to have invented and given the world, like cricket and hockey and soccer, we work in units of 11. But somehow, i thought 11 was not a sufficiently churchillian size of team. So i thought maybe i should look more at american football as an example. Because when i watch it on my visits over here, im always amazed by the number of players on the sidelines waiting to come in. And then when i did a little tiny bit of research, i found that in fact american football teams work in units of 11. Did you know is that right . You very helpfully have an offense and a defense and, i believe, even a specialist kickers teams. Are they 11 as well . So it is 33. Is that right . Is it 33 people in total . 53. I dont have time for 53. [laughter] mr. Lough i thought what i would do is borrow more from american football than soccer, which we call football, and i particularly like the four quarters. Im going to take the four quarters, and im going to highlight a few players in each quarter. I am also going to give you and this is american football i am going to give you a bit of halftime entertainment. So first quarter. This is a defensive line up. Let me tell you. It will not have escaped your attention that all the players i am highlighting in this quarter, which roughly goes from birth, 1874, up to 1900, 35 years old they are all women. Because it was to women that churchill looked for support in the first while he was a student. For financial support, he had to, because he was being caps on a very tight leash by his father at the time. Partly because his father had very little money until the final years, partly because his father thought he was hopeless with money, his son was hopeless. His father would not even give him an allowance at sandhurst. He appeals to the women in his letters for help, and they nearly always pay out. First, on your left is mrs. Everest, his nanny, from whom he was a reasonably frequent borrower. She complained that he didnt always acknowledge the loans in writing and was often late with repaying them. On your right is his fathers sister, aunt cornelia, lady winborn. Aunt cornelia had the good sense to marry money. She married into the guest family, which in british terms is a a great iron and steel family. They had lots of money. Aunt cornelia was very reliable. If Young Winston wrote her a letter, she would write back and she would always enclose a nice sum of money with that letter. In fact, she went on later in life to give him money for his parliamentary expenses. And in 1921, when he bought a rollsroyce and it didnt really meet expectations, she bought it back. She took it off him three months after he bought it at only a 10 discount off of list price. I could have added others. I could have added the woman who signed herself the deputy mother, lady wilson, who always enclosed two pounds. That is 300 today, with every letter she wrote him. I could have included aunt clara. Probably not the dowager duchess of marlborough, who tended to take her sons side and administer stern lectures to winston. But pride of place in this quarter has to go to the woman in the middle, jennie jerome, about whom we have been hearing. And i endorse everything that was said earlier. She was a star. She was not necessarily a financial role model, it has to be said. Rather the reverse. She is highly extravagant, has no real sense of money. She has a sense of entitlement to the best. In the early days when lord randolph was still alive, she felt she had to give her son winston a bit of a scolding when he asked for money, but then she normally came up with the goods. She became really important after her husbands death. He left his two sons no formal allowance. He left his money in trust with his wife. She didnt really understand what a trust was and the difference in the income calendar. She did allow winston 500 pounds the equivalent of about 50,000 or 60,000 a year allowance. She used to, for the first couple of years after her husband died, regularly coached him that he had to live within his means. All the while, she was spending the capital from the trust. Eventually, the lawyers rumbled to this, and she had to write to winston to say, im terribly sorry, please sign here. From then on, her lectures about sticking within his means dried up. She didnt lecture him anymore. They shared their money problems. He reacted to these financial problems by going out and doubling up as a journalist, writing from afghanistan and sudan, as well as a soldier. I closed it too much. And she acted as his agent back at home. She sold his articles, sold his first books, did a great pr campaign for him, for his first efforts. She was absolutely vital to his early steps. It was only later that the tide turned, when she got into trouble with her second marriage and she became dependent on him. He and jack had spent a lot of time sorting out her affairs in the second marriage, and then at her death, when she died not only without a will but owing lots of money to lots of people. So it was a bit of a mixture. Now, i want to check the second slide coming up. It is not. No . Can anybody help me in the back . Its on my screen but its not up on your screen. [inaudible] ok, when we get it up, in the middle, it is going to be no, back one. Too much. There we go. Ok. In the middle is the man who looked after the in todays money, about 1. 25 million that churchill had saved by 1900, by the end of his lecture tours after the bohr war. You heard about his boer war escape, made him an international star. He not only wrote books but lectured in the u. K. And over here, and at the end of the tour he had made Something Like 1. 25 million, and he needed it looked after. Enter this guy in the middle, sir ernest cassel. An immigrant from europe. He had come over in about 1870. He had started as a cotton trader in liverpool. He quickly moved to london as a banker, and he over the course of about 20 years, he supplanted the rothschilds in leadership in the city of london. He looked after i use the word in quotation marks, he looked after the prince of wales, later edward vii and his coterie he looked after their Financial Affairs. His nextdoor neighbor was the dowager duchess of marlborough, so he became friends with Winston Churchills parents and he had a soft spot for Young Winston. Particularly after his fathers death. He offered to manage winstons savings for nothing, and winston thought he did it very well. And then he invited winston out to the opening of the dam he financed in egypt. He invited him to holidays in his swiss chalet and when i say that, dont think of some modest little thing, it was huge. He equips the bolton Street Library for churchill. He gave him 500 pounds, so we are talking sort of 75,000, in cash on his wedding. And he and when Winston Churchill went to fight in the front in 1915 and went on the fairly miserly army majors pay, originally and was worried about the finances at home, sir castle said, dont worry, i give you unlimited credit. His final Financial Service to Winston Churchill was in 1920, when churchill overextended himself, found himself the contractual buyer of two homes in london when he only meant to buy one, and he tried to put out his sale to the duke of wellingtons son. He expected to be able to get out of it, but actually the duke of wellingtons son said, hey, you know, we have a contract, and i will blacken your name if you try to get out of it. Castle wrote out a check and covered it. And conveniently died two months later and his executors never asked for the money back. Now as he spent his savings in the first decade of the 20th century, his bankers became more important because they had to lend to him. His bankers were cox and co. , who generally banked the british army officers. And actually, churchill never changed his bank in the whole of his life. The bank changed a bit because they were taken over by lloyds bank. It gave him a fair number of nightmares, and his Bank Managers had some pretty worried evenings and nights, i suspect, but lloyds never lost a single pound in lending to him in the end. And his Relationship Manager, as we would call him today, the first 20 years or so i couldnt find a picture of him, which is a shame w h bernaud, but he always signed himself w. H. He was churchills Relationship Manager for 20 years. We know quite a bit about the relationship because his son donated his papers, both official and the notes he took up their meetings, to churchill, and it deposited into the churchill archive center. And for a boring banker and would be historian like me, they are a dream, these papers. And you can see them. He took careful notes. He was a fellow mason, gave him a Certain Affinity with winston, and he was endlessly patient. And he always had faith and faith in churchill as a customer. Whenever he missed loan repayments, deadlines, or failed to bring his overdraft back under the policy limit, bernard tried to make sure that within the banks hierarchy, he was given another chance. And on the few dates that he wasnt, bernard would always try to sort him out with insurance companies. The lady on the right, im so glad you gave me the picture, because i would not have been able to convey the full picture of the lady on the right. Does anybody know who she is . She is francis of londonderry, who by her 1862 will, left her own property in ireland not her husbands, her own property in ireland and like many women of aristocratic husbands, she was not interested in leaving it to the oldest son because the oldest son and his children were always going to be looked after by the husband. A mother is worried about the younger children. So, she left the estate to the children of her younger children. Ok . She had by then, she knew she had three grandsons at least. And she had there were going to be sons from her daughter, who married the seventh duke of marlborough. There, i suppose, is the clue. But the estate had to say together, so it was to go in order of male seniority. Now the amazing thing is that the three grandsons each died childless. And the last of them died in a train crash in 1921 on a strip of rail, a single track of rail in north wales. Two trains collided and on them was the last of her grandsons. He was a director of the railway company, so dont feel too sorry for him. So, there was the extremely remote chance that this happened, but the estate fell to the children of her daughter, and of course, that would have been the eldest, the second son. Because the first was looked after. It would have gone to Lord Randolph Churchill if he had been alive, but he had by then died. So it fell into the hot, sticky hands of Winston Churchill. And after death duties in ireland, it was still worth todays equivalent of about 5 million. Very welcome it was, too. I remember that clementine said day after this accident, she wrote to winston, her husband, and said, i cannot describe the blessed feeling of relief that we need never, never be worried about money again. And then she said in brackets except through our own fault, of course. And this is what happens. The spending goes out. That is when they buy the rollsroyce. She takes a ladys maid fulltime who travels with her. And this is what happens. Spending goes out. That is when they buy the rollsroyce. She takes a ladys made fulltime, travels with her. He is stuck trading, and when i say trading, it is not investment. And the gambling goes up. Big losses in 1923. And so, that was three times budget it ran to enhance, and actually by 1925, when winston becomes chancellor of the exchequer, most of the inheritance is gone for years later. And this is where we have a little policy while he is chancellor of the exchequer because he has to behave pretty well. So this is the halftime entertainment with a surprising entertainer. Now the clue i said they called it skating on thin ice. This is the mail of the entertainment, your halftime entertainment. Skating on thin ice, and the clue is in the picture. That building is called somerset house. And it was no longer is, but was the headquarters of her majestys inland revenue, which is our equivalent of the irs. And so, my halftime entertainer is in fact no less than the chairman, because when winston became the chancellor of the extract or in 1925, responsible for tax policy and tax collection, he thought first of all, i have got to sell up all my shares. I have to pay down my debts. I think there is going to be a surplus, and i am just going to behave financially very responsibly when im chancellor. Unfortunately, when he sold the shares, theres not a surplus. He was left with a deficit. He had as much of the bank, he had an overdraft of the maximum size of the bank would allow him to have. And he had about two days equivalent todays equivalent of 5,000 of tax left to pay, and he was the chancellor, he had no money to pay it with. So, what he did was summon the chairman of the mn review, and say essentially, have you got any suggestions . And the chairman is not an experienced civil servants. Near the end of his career. Who can say to them, just like, i think this conversation better stop here and now. He says, chancellor, i understand the problem. Let me talk to my senior people and see what we can do. And a week later, he comes back on an unofficial you know, his own notepaper in his own hand, and he says, we found an anomaly. If you retire as an author, we will be able to retire income, capital receipts, capital receipts are untaxed in the should have your tax bill. And churchill says thank you very much. Thats fine. And he writes the necessary letter, and his tax bill is halved. Thats all fine except by the following year, 1926, he is still chancellor. He is paid quite well as chancellor, but its not enough. The bills are still coming in. He realizes he has got to start riding again, and he gets the Prime Ministers permission to write the next volume of the royal crisis. And he says, oh, i wonder if there is a problem. Maybe they will deem my retirement never to have taken place and i will have to pay the tax bill, which i cant afford to do. So, he says, you remember you helped me to retire a year ago . I now need you to help me unretire. The guy says, i will talk to my senior people. He comes back and says, if you write me a letter like this, it should be ok. And churchill writes the letter. Now thirdquarter, this is a bit and busier this quarter. More people on the field, but churchill is very much in charge. You know, he did it his way and top left is one of your own. They have become friends of the late stages of the First World War when churchill was responsible for munitions. And they learned to trust each other and the relationship was cemented really in 1929 when churchill lost his job as chancellor of the exchequer and the government was turned out and he decided to take along to her to the u. S. And he asked him to arrange for his hosts here, which he did. Big men, schwab, hearst, people like that. And then when he got to new york, he accesses h