The Conflict between the Islamic World and Christendom and The Wealthy Templar
The Pope’s Crusades didn’t do so well given the fact that the first crusaders were relatively untrained, unpaid, under-equipped armies consisted of peasants and pilgrims. A particularly noteworthy campaign was the so-called Children’s Crusade in 1212, which consisted of about 30,000 children from France and Germany and matched toward the Holy Land. Bands of children ended up in Italy and were sold off as slaves.
The Knights Templar was founded in 1119 by nine of its original members, who approached King Baldwin II of Jerusalem, and proposed creating a monastic order for the protection of these pilgrims, with a pledge “Non nobis, Domine, non nobis, sed Nomini tuo da gloriam” and self-proclaimed as the “Poor Knights of Christ and the Temple of Solomon,” or “Templar” knights. It had grown to became a backbone of the Crusaders in the next decades, with the Knights Hospitaller and the Teutonic Order who later followed their suit.
The “Poor Knights” were anything but “poor” as they obtained enormous wealth by establishing itself as a monopolized charity group in the region that collected massive donations from all over Christendom for the cause of the Holy Land. On top of that, the order was exempted from paying any taxes or obeying any local laws from the directive of the Pope in 1139, which made the Knights Templar essentially a money printing machine above the laws when not fighting.
Unfortunately, only were the Templar’s fighting abilities as good as their money-making skills. After several unsuccessful campaigns, Jerusalem was taken by Muslim in 1187 and the Templar were forced to leave the region with their wealth back to Europe. Ever since, the Templar gradually re-invented itself from a military force to a banking / human-resource agency for the Crusades.
The Templar Management — High Finance
If a nobleman was interested in joining the Crusades, he could place his assets under the Templar management. Other businesses included issuing new loans to the crusaders and finding new recruits. Their business network would spread across the whole Christendom with this mix or donations and business deals. The Templar soon discovered issuing letters of credit to the pilgrims journeying to the Holy Land to be a great business. Pilgrims deposited their valuables with a local Templar “branch” before embarking, received a document indicating the value of their deposit, then used that document upon arrival in the Holy Land to retrieve their funds in an amount of treasure of equal value. The business model would later apply to common people other than the traveling pilgrims.
As a growing financial institution, the Templar would issue loans and lines of credit (i.e. cheques) to businessmen, townships, and the local princes. Headquartered in the island of Cyprus, where the Templar conducted the overall accounting and logistics, the Templar had become the first choice of finance and fundraising for the Kings and Cardinals across Europe.
One of the reasons that made the Templar so successfully in banking was probably their “credibility.” The knights could hold no property and receive no private letters. They could not be married or betrothed, or have unpaid debt. A violation was punishable by a denial to the right of a proper burial site in the Knights Templar grave. The religious order greatly minimized the financial risk associated with a bank failure. Like a Swiss bank, the Knights Templar became the most trusted financial institution in Europe when they treated their customers as they treated the Lord.
For example, when Henry III, the King of England, arrested a nobleman named Hubert de Burgh in 1232, the Templar in the London branch refused the King’s request to turn over his assets. The King was told nothing could be yielded up, even to the King, except with the consent of the depositor. Same story goes for Louis IX of France, who was captured by the Egyptians in 1250. His count contacted the Templar to release the King’s private savings to raise the ransom money and only received a similar response.
The Order of the Knights Templar eventually had become the most powerful and wealthiest network across the whole of Christendom. They acquired large tracts of land, bought and managed farms and vineyards. They built massive cathedrals and castles. They were in manufacturing, import and export. An annual income would exceed that of a single European nation.
The Decline and Destruction of the Templar
In 1285 when Philip IV of France found himself in a desperate need for funds for his war against the English and their allies in Flanders. At first, he tried to rip off the local Jews by expelled them and taking over their loan collection businesses. That didn’t go well. His attention and his thrust for money would then turn to the Knights Templar, to whom he was substantially in debt to.
Philip IV instructed his officials to open a confidential letter on October 13th, 1307. The content of the letter would be a list of the Templar in the region to be arrested for the charge of heresy, and their assets to be confiscated. At daybreak, hundreds of Templar were arrested and later tortured into admitting heresy in the Order.
The Templar were supposedly only answerable to the Pope and the organization was by nature international. So a single blow in France would not destroy the Templar’s foundation, as it remained untouchable outside of France. It was only one man who could change all that — Pope Clement V — who was in Philip’s payroll.
The Last Templar
Philip IV essentially ordered the Pope to arrest the remaining Templar members and disband the organization. Pope Clement did attempt to hold proper trials, but Philip used the previously forced confessions to have many Templars burned at the stake before they could mount any proper defense. The Templar were completely destroyed. Jacques de Molay, the last Grand Master of the Templar, was said to make a curse before burned at the stake, warning the Pope that, within a year, he and Philip IV would be obligated to answer for their crimes in God’s presence. And indeed Philip and Clement IV did die within a year of Molay’s execution.