Genes behind Levis help shape Jewish community for almost 150 years in San Francisco and vicinity

Bavarian-born Loeb Strauss moseys off a steamship in San Francisco. It's 1853. He's surrounded by gunslingers, gold-rushers and carpetbaggers.

Does he think, "What each of these guys needs is a nice pair of Loeb's jeans?"

Not exactly.

Aside from the fact that his now-famous jeans brand would not be invented for another 20 years, he had already changed his first name to "Levi" a few years earlier while in New York City.

Strauss was in San Francisco to set up a branch of the family dry goods business.

He ended up being first in a long line of heirs who have had a monumental philanthropic influence on Bay Area Jewish life.

Strauss could have easily bucked religion for rampant opportunism in the Wild West. Instead, he kept his biblical name, quickly joined the fledgling Congregation Emanu-El and proceeded to become a standout member of the Jewish community.

Now, Levi's blue jeans have been around for 126 years, and Levi Strauss & Co. is just three years shy of its 150th anniversary.

But not all is rosy. Two weeks ago, the company offered a rare glimpse into its financial status, revealing that its 1999 earnings decreased a whopping 94.8 percent from a year earlier.

The privately held company, considered the world's largest apparel manufacturer, said its profits plummeted from $102.5 million in 1998 to $5.4 million in 1999, according to a document filed with the Security and Exchange Commission.

But the story of Levi Strauss & Co. isn't just a story of profits and denim.

It's also a story of the rise of the Bay Area Jewish community.

Historians and family members say that's the way Strauss would have wanted it.

"It's a great story," said John Goldman, a great-great-nephew of Strauss who lives in the Bay Area and is heavily involved in numerous Jewish agencies. "He was one of the founders of a Jewish community where none existed."

Though few currently consider Levi's to be a Jewish brand name, Strauss' company from the beginning apparently had a high Jewish profile.

"Jewish businessmen like Strauss were consciously known throughout the city as Bavarian Jews," said Fred Rosenbaum, the founder of Lehrhaus Judaica in Berkeley and the author of the recently published "Visions of Reform: Congregation Emanu-El and the Jews of San Francisco, 1849-1999."

"Not only was there an absence of anti-Semitism, but people respected and admired the Jews. Strauss was very proud of it."

Although almost all the company records were destroyed in fires in 1886 and 1906, the few existing accounts describe Strauss as a man who put Jewish wisdom to practical use in his business.

Rabbi Martin Meyer, who became spiritual leader of Emanu-El a few years after Strauss died in 1902, wrote that Strauss had an "honorable conception of business, great integrity and the ambition to make life expressive of the virtues that should adorn the Jew placed in a station of great responsibility."

That sense of integrity in business in a no-holds-barred era of money-making perhaps led Strauss to his biggest payoff.

Nevada tailor and regular Strauss customer Jacob Davis, a Latvian-born Jew, sent a letter to Strauss in 1872 describing Davis' new invention. Davis, who purchased large rolls of cloth from Strauss, wrote that one could use metal rivets to bind together points of strain on denim pants. Lacking the money to apply for a patent, Davis asked Strauss to join him in patenting the process.

The patent was granted to both men on May 20, 1873. Strauss brought Davis to San Francisco to oversee the first West Coast manufacturing site of the "waist overalls." Lot No. 501 was first issued in 1881.

The dry goods business and the sale of jeans, mostly to miners, bustled. At the same time Strauss was pulling in huge profits from his business, his philanthropic fame was swelling.

In the Jewish world, Strauss contributed to just about every charity, including the Pacific Hebrew Orphan Asylum, the Eureka Benevolent Society, the Hebrew Board of Relief, the Home for Aged Israelites and the Emanu-El Sisterhood. He also anonymously co-funded Emanu-El's annual gold medal given to the best student in the Sabbath school.

"When Strauss died, the papers referred to him as a philanthropist before a businessman," said Levi Strauss & Co. historian Lynn Downey.

Strauss had no children. He left the company to the children of his brother-in-law, David Stern.

In the company's development, the next big change came when Walter Haas Sr., who married Stern's granddaughter Elise, took over the company. As president of Levi's from 1928 to 1955, Haas dropped the dry goods business and revved the company into a national clothing powerhouse, doubling revenue from $3 million to $6 million.

According to Doug Goldman, Haas' grandson and a great-great-nephew to Strauss, the company also reaped rewards from innovative marketers who built up the cowboy image behind the jeans and the business.

Haas and business partner Daniel Koshland poured grants into the Jewish community. Some credit the Levi's magnates with propelling the Bay Area into the national scene of Jewish life.

"They were the deans of the Jewish community," said Wayne Feinstein, executive vice president of the S.F.-based Jewish Community Federation. "Anything that was of value and needed support, once the case was made, they'd roll up their sleeves and say this is what we have to do."

As to why Haas took such an active role in the Jewish community, Doug Goldman said simply that Haas "had a sense that this was his community. San Francisco was his hometown and the Jewish community here was something he identified with."

With Haas, Levi's also honed its reputation as an ethical business. During the Depression, Haas did not lay off workers and kept them busy by redoing the factory floors.

"The idea of corporate social responsibility was important long before it became a buzz word," said Peter E. Haas, president of Levi's and Walter's son.

Walter Haas left the company to his children, who further pumped up the firm to where it had sales of $6.9 billion in 1997.

However, annual sales have dropped by 25 percent since then, falling to $5.9 billion in 1998 and to $5.1 billion last year.

In September, Walter's grandson Robert Haas stepped down as CEO but stayed on as the firm's chairman. Philip Marineau became the new CEO — only the second time in the company's history that a non-family member has been handed the reins.

Competition from the likes of Tommy Hilfiger and Calvin Klein continues to hurt Levi's, which has eliminated 18,500 jobs and closed 29 plants over the past several years.

Levi Strauss & Co. is not required to disclose financial figures to the public, but opted to submit a document to the SEC on May 4 in order to register for $800 million in bonds.

"Despite our brand recognition, our operating and financial performance has decreased over the past three years," the document said.

The company has been battered as of late by stormy business matters. A leveraged buyout in 1996, which consolidated the company's shares from several family members to just a few, caused internal strife in the company and the family.

And whereas Levi's won praise a few years ago for its unusually generous severance package for laid-off workers, the May 4 document revealed that $344 million in planned employee bonuses had been scuttled because cash-flow targets had not been reached.

Aside from questions about Levi's financial future, questions remain as to whether the company still retains any Jewish identity.

Historian Downey said that although the company never gets letters explicitly saying "what a nice Jewish company," a few anti-Semitic notes have arrived in troubled times. The company ignores those letters, she said.

Still, Downey attested, the company has no intention of disregarding its Jewish past. "It's in the company's DNA," she said.

Regardless of the company's identity now, Rosenbaum maintains that Levi's hasn't received enough recognition as a Jewish firm. He views the company as a California Jewish phenomenon.

"In Germany, during Strauss' time and beyond, Jewish businessmen were attacked for trying something new. But in California, Strauss was so admired for innovation," Rosenbaum said.

"Jeans are the most American product the world has ever seen…I'm still looking for Jews of the West Coast to get their due."

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