Churchill and His Money: No More Champagne

by David Lough

An Introduction: Churchill and his Money

This book owes its genesis to a provocative history teacher and to a scandalized grandmother. The first tried to stimulate independent thought in his fourteen-year-old pupils by describing Winston Churchill as ‘a romantic old windbag’; when I took his verdict home as my own, the second ordered my re-education by setting me to read each volume of Churchill’s official biography on its publication. The early volumes of this work reveal how money problems weighed heavily on the young Churchill’s mind, but the trail becomes fainter in the later volumes as the public man takes center stage. Only in 1998 when Churchill’s youngest daughter Mary published a collection of her parents’ private correspondence did it become clear that financial difficulties dogged him for most of his life. Although Churchill’s many biographers have covered almost every imaginable angle of his life, none has tackled the story of his finances. Surprisingly most of the material needed to piece together the story survives and is open to researchers. One of Churchill’s endearing characteristics is that he happily left his own bank statements, bills, investment records and tax demands in his archive, despite the fact that they reveal evidence of debts, gambling losses and last-minute rescues. Some of his financial benefactors partially covered the trail by weeding out evidence from their own papers or by ordering their destruction, but it has been possible to fill most of the gaps. For example, Lady Soames kindly gave me permission, before her recent death, to examine those of her father’s bank statements which survive in his bank’s archive, although not in his own papers.

No More Champagne

Lord Randolph Churchill, Winston’s father.
Image is in the public domain via

There are many reasons why the tale of Churchill and his money deserves to be told. It adds undeniable colour to a tapestry already rich in detail. It offers a human story of survival against the odds, although many of his difficulties were self-inflicted. It captures a time in British life when wealth was passing from a privileged few families of the landed aristocracy to a new class of entrepreneurs who were forging fortunes in businesses as varied as the railways, mining, newspapers and finance – the ‘plutocrats’, as they were known in their day. Unusually, Churchill had a foot in both camps: a grandson of the 7th duke of Marlborough, he was born a member of the aristocracy and enjoyed its trappings of expensive clothes, fine food, personal servants and the delayed payment of bills; yet he was equally at home among the new breed of entrepreneurs, many of whom were friends of his parents, especially of his talented and attractive American mother.
Churchill’s financial trials also had an impact on his politics. When his father Lord Randolph Churchill died aged forty-five, he left no immediate allowance for his children in his will and the twenty-year-old Churchill had to rely on his own talents. Within five years he had built up a capital sum equivalent to a million pounds today. This meant that he could make an early start in politics, but it also gave him a greater affinity with the attitudes of ‘new’ money rather than ‘old’ when party politics demanded he choose between them. His early defection from the Tory Party of his aristocratic friends to the Liberal Party of enterprise is explained at least as well by his personal experiences of the decade following his father’s death as it is by any abstract, ideological preference for ‘free trade’ over ‘protection’. A lasting sense of betrayal at this defection among many Tories contributed to Churchill’s loss of political office in 1915: his head was part of the price demanded by Tory leaders before they would join a wartime National Government.

‘The only thing that worries me in life is money.’ *
Winston Churchill, 1898

Churchill’s Liberal colleagues, in contrast, suspected that he remained a Tory at heart. Their suspicions were confirmed when, some twenty years later, he rejoined the Conservative benches. Biographers variously attribute Churchill’s behaviour to a concern over social disorder following the war or to sheer political ambition, but there is a third possibility: Churchill had recently inherited his great-grandmother’s Irish estate, transforming the erstwhile entrepreneur into a propertied landlord for the first time in his life– a rentier, as his wife Clementine put it.

To her intense disappointment, Churchill consumed the entire inheritance within a decade – by underestimating the cost of converting his new country home at Chartwell, by gambling more than he ever let on and by losing heavily in the Wall Street Crash of 1929, an episode curiously omitted from his official biography.

No More Champagne

1949: Clementine with husband Winston Churchill at Epsom racecourse for the Derby. (Central Press/Hulton Archive/Getty Images).
Image is in the public domain via

These losses caused another financial impact on his political career in the 1930s: Churchill resigned from the Conservative front bench not just because he was out of sympathy with the party’s policy on future independence for India, but to devote sufficient time to writing books and churning out newspaper columns to keep the bank at bay. In return for his high fees as a journalist, Churchill’s friends among the press proprietors expected colourful copy that ran against the conventional political wisdom. Churchill delivered it, but the trenchant journalism made his political rehabilitation more difficult.
Several times during the decade he held his journalist’s pen in check while ministerial changes were in the air, but neither Prime Minister Stanley Baldwin nor his successor Neville Chamberlain was tempted to invite such an awkward talent back to the cabinet table at a time when the electorate preferred peace to adventure.

A common thread of exceptional risk-taking unites Churchill’s financial dealings and his political career. This was never more clearly on display than in the 1930s, when he was a married man in his fifties with four dependent children and already borrowing today’s equivalent of more than £2.5 million ($3.75 million). Yet, during the decade, he gambled heavily enough on his holidays to lose an average of £40,000 each year in today’s money.

I have never encountered risk-taking on Churchill’s scale during my career of advising people about their finances, including such natural risk-takers as entrepreneurs and politicians. I have sought an explanation for it in the growing body of literature that analyses Churchill’s mind. However, this is inconclusive as to whether his appetite was simply a facet of a wonderfully extravagant personality or whether it pointed to a more complicated state of mind. Churchill himself referred to periods when the ‘black dog’ of anxiety or depression struck him; this book tells of contrasting phases during which he gambled or traded shares and currencies with such intensity that he appeared to be on a ‘high’ – devoid of inhibition, full of self-confidence and energy, but prone to ‘risky behaviours’. The truth is that we will never know whether Churchill’s addiction to risk was a matter of personality or state of mind; by today’s standards of diagnosis, a psychiatrist would require a long, first-hand conversation with his subject before reaching a conclusion – and sadly Churchill is not available.

Whatever the driving force behind the risks he took, Churchill left behind him a trail of financial failures that required numerous rescues by family, friends and acquaintances, the story of which I tell in these pages. One rescuer alone wrote out two cheques, together worth more than £1 million ($1.5 million) today. He did so only because he admired Churchill’s political courage, another testament to the links between Churchill’s political career and his finances.

No More Champagne

Throughout the Second World War many of those around Churchill worked hard to tame his risk-taking, their success ultimately evidenced by his willingness to delay the Allied invasion of Normandy until the summer of 1944. Churchill’s attitude to his own finances underwent a similar conversion over the course of the war, during which he devoted more time to his private affairs than is often realized. Having begun the war with substantial debts, he finished it with today’s equivalent of £4 million ($6 million) in his bank account. The secret of this turnaround lay not in books, as is often supposed, but in films.

The remarkable story of Churchill and his money only makes the man himself more fascinating. In an age when we demand that our politicians are paragons of financial virtue it is salutary to discover that one of the most successful political figures of the twentieth century ran up huge personal debts, gambled heavily, lost large amounts on the stock exchange, avoided tax with great success and paid his bills late.

David Lough is the author of No More Champagne: Churchill and His Money and studied history at Oxford under Richard Cobb and Theodore Zeldin. After a career in financial markets, he founded a business that advises families on looking after their investments, tax affairs and estates. No More Champagne is his first book.

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