Friday, May 31, 2013

May 31 (1889) Johnstown, PA Great Flood: "It appears that the loss of life was incurred through neglect and disbelief"

A house after the Johnstown flood in 1889
On this day in 1889, the South Fork Dam at the reservoir named Lake Conemaugh failed, releasing a torrent of water that killed 2,209 people, and leveled the town of Johnstown, PA. It was the most costly disaster, both in terms of lives and money, yet experienced.

Though the South Fork Dam had a long history of disfunction, most survivors of the Great Flood blamed the dam's failure on the South Fork Fishing and Hunting Club, an exclusive resort located near the dam.

Club members were mostly wealthy Pittsburgh industrialists, including a young banker named Andrew Mellon. Repairs made by club owners--raising the lake level, and building cottages and a clubhouse to create a secretive retreat--made the area more vulnerable to massive flooding.

Despite evidence of its shoddy condition, no successful lawsuits were ever brought against club members for its failure and the resulting deaths downstream. The court held that the event was an Act of God, for which no one could be held responsible.

Below is a report of the flood printed in the Evening World, on June 1, 1889.

"King Death!...The stream of human bodies which has been washed down the river mingled with the wreckage of the houses, factories and other buildings have been something fearful to witness. At present it is utterly impossible to estimate, even approximately, the damage done... 

The foundation of the South Fork dam was known to be shaky a year ago, and leakages have been numerous. It appears that the loss of life at Johnstown was incurred through neglect and disbelief." 

Further Reading

Johnstown Flood Wikipedia entry

Johnstown Area Heritage Association

Johnstown, PA

Andrew Mellon Wikipedia entry

Also, check out David McCullough's book on the Johnstown Flood.

Thursday, May 30, 2013

May 30 (1868) The first Decoration Day to commemorate those who died in the Civil War

East front of Arlington Mansion (General Lee's home), with Union soldiers on the lawn, 1864.

On this day in 1868, the first Decoration Day was observed, the predecessor to our modern Memorial Day. General John A. Logan issued the proclamation calling for a "Decoration Day," to be observed annually and nationwide, to commemorate the Union and Confederate soldiers who died fighting in the Civil War.

He chose May 30 because the date was not the anniversary of any particular battle, and it was an optimal time for flowers to be in bloom.

It wasn't until 1968, and the Uniform Monday Holiday Act, that Memorial Day was changed to the last Monday in May.

Speaking at Arlington Cemetary on Decoration Day in 1880, Representative George C. Hazelton from Wisconsin spoke about some of the underlying causes of the War.

"The conflict of arms in which over a quarter of a million* American freeman lost their manly lives, and which you of the Grand Army of the National Republic happily survive, was the natural and irresistible result--the culmination in war of a long civil conflict over principles which underlie free government, and which constitute the very foundations of civilizations and human progress...

The issue between the two forces closely drawn and well defined, compassed the territorial integrity of the government; the destruction of the union and of liberty itself. The one sprung to arm upon the abstraction that the right of succession was reserved to the States and upon the theory that by right, capital should own its labor, control it, buy it, sell it, debauch it. 

The other came to the fields of war with the conviction entrenched within its heart that the Union was inseparable, that labor should be its own master, wear no shackles, and stand erect before the law of government, and before God and man, honorable, and honored.

Liberty, then, must cast her fortune with the Union cause or perish on our continent."

*Later estimates brought this total to 620,000, and some experts argue the total is more like 750,00.

Further Reading

The entire Decoration Day oration from Hon. George C. Hazelton

Wikipedia entry on the Uniform Monday Holiday Act

Wikipedia entry on George C. Hazelton

Civil War Trust

Historian revises estimate of Civil War dead

Wednesday, May 29, 2013

May 29 (1886) John Pemberton places first ad of Coca-Cola; SunTrust Bank earns billions

Coca-Cola advertising during the early 1900′s relied on young women as their spokespersons. The first spokesperson of Coca Cola is model Hilda Clark.

On this day in 1886, John Pemberton placed the first (of many) advertisements for his soft drink sensation Coca-Cola in the Atlanta Journal.

In 1919, the Trust Company of Georgia (now SunTrust Bank) underwrote the Coca-Cola Company's IPO, and for its services received some of the company’s first publicly traded stock, in lieu of cash. Ernest Woodruff and a group of investors also purchased shares of Coca-Cola; for financing they obtained a loan. As collateral, Mr. Woodruff arranged to have the formula committed to paper (a first). When the loan was repaid in 1925, Mr. Woodruff reclaimed the secret formula, and placed it in a Trust Company vault, where it safely remained until December 2011 when it was moved to the World of Coca-Cola museum in Atlanta.

In September 2012, SunTrust sold most of its share of Coca-Cola, reaping over $1.2 billion in profit, which was used to cover losses from the Great Recession.

Here's an example of a Coca-Cola ad from the late 1880s.

"This 'intellectual beverage' and temperance drink contains the valuable tonic and nerve stimulant properties of the coca plant and Cola (or Kola), nuts, and makes not only a delicious, exhilarating, refreshing and invigorating beverage, (dispensed from the soda water fountain or in other carbonated beverages) but a valuable Brain Tonic, and a cure for all nervous affections--sick, head-ache, neuralgia, hysteria, melancholia, &c.

The particular flavor of COCA-COLA delights every palate; it is dispensed from the soda fountain in the same manner as any of the fruit syrups."

This was later shortened to "Coke is it."

Further Reading

SunTrust Bank website

A history of Coca-Cola advertising

SunTrust Sells 93-Year Coke Stake as Crisis Hangover Ebbs

Coca-Cola moves top-secret formula for 1st time since 1925

World of Coca-Cola website

Tuesday, May 28, 2013

May 28 (1830, 1887) Pres. Andrew Jackson Signs Indian Removal Act; "The World's Greatest Athlete" is born

Jim Thorpe honored posthumously on the cover of Wheaties, (2001)

On this day in 1887 (though the exact year is debated), the man once dubbed "the greatest athlete in the world," James Francis "Jim" Thorpe was born in Indian Territory near Prague, Oklahoma.  His parents had both European and Indian ancestry, and Jim was raised as a Sac and Fox Indian with an Indian name of Wa-Tho-Huk, translated as "path lit by great flash of lightning" or simply "Bright Path." He was also raised Catholic, a religion he practiced his entirely life.

Jim Thorpe was the hero of the 1912 Olympics, and went on to successfully compete in both professional baseball and football.  A statue of him rests outside the football hall of fame in Canton Ohio. In his New York Times obituary, written in 1953, Jim Thorpe was describe as "probably the greatest natural athlete the world had seen in modern times."

Also on this day in 1830, President Andrew Jackson signed into law the Indian Removal Act, which authorized the president to exchange unsettled lands west of the Mississippi for current Indian lands within existing state borders. Approximately 4,000 Cherokees died when forced to relocate to Oklahoma, a march that became known as the "Trail of Tears."

In his address to Congress, President Jackson had this to say about his new law:

"It gives me great pleasure to announce to Congress that the benevolent policy of the relation to the removal of Indians beyond white settlements is approaching a happy consummation...

By opening the whole territory between Tennessee on the north and Louisiana on the south, to the settlements of the whites it will incalculably strengthen the southwestern frontier. 

It will relieve the whole State of Mississippi and the western part of Alabama of Indian occupancy, and enable those states to advance rapidly in population, wealth and power...

It will separate the Indians from immediate contact with settlements of whites; free them from the power of the states; enable them to pursue happiness in their own way, and under their own rude institutions; will retard the progress of decay, which is lessening their numbers, and perhaps cause them gradually, under the protection of the Government, and through the influence of good counsels, to cast off their savage habits, and become an interesting, civilized, and Christian community."

Further Reading

President Andrew Jackson's full address to congress

Jim Thorpe's Obituary in the New York Times

Biography of Jim Thorpe

National Park Service commemoration of the Trail of Tears

Smithsonian's conservation of the Jim Thorpe "Wheaties" box

Monday, May 27, 2013

May 27 (1937) Golden Gate Bridge opens to pedestrians "Above the fog and scorn and doubt"

Pedestrians walk across the Golden Gate Bridge on May 27, 1937. San Francisco Chronicle archive photos of the Golden Gate Bridge construction and opening to the public. Photo: San Francisco Chronicle

On this day in 1937, San Francisco's Golden Gate Bridge was opened to the public for the first time.

San Francisco reveled in its creation, which they marked by declaring May 27 "Pedestrian's Day." By 6am, 18,000 people were waiting to cross the span from both the San Francisco and the Marin sides.

Probably no one was more pleased than the bridge's chief engineer, Joseph P. Strauss.  He wrote many poems to commemorate the occasion, including one from the perspective of the bridge.

The Golden Gate Bridge
Written upon completion of the Bridge sometime in 1937

I am the thing that men denied,
The right to be, the urge to live;
And I am that which men defied,
Yet I ask naught for what I give.

My arms are flung across the deep,
Into the clouds my towers soar,
And where the waters never sleep,
I guard the California shore.

Above the fogs of scorn and doubt,
Triumphant gleams my web of steel;
Still shall I ride the wild storms out,
And still the thrill of conquest feel.

The passing world may never know
The epic of my grim travail;
It matters not, nor friend or foe –
My place to serve and none to fail.

My being cradled in despair,
Now grown so wondrous fair and strong,
And glorified beyond compare,
Rebukes the error and the wrong.

Vast shafts of steel, wave-battered pier,
And all the splendor meant to be;
Wind-swept and free, these, year on year,
Shall chant my hymm of Victory!

Saturday, May 25, 2013

JP Morgan & Allies negotiate loan with Germans: "I suppose it sounds fantastic to lend to our enemies"

Delilah, representing the Republic of France, prepares to weaken Samson, resting on a pillow marked "Europe," by cutting his hair.

On this day in 1922, the New York Tribune reports "German Loan, If Protected, Now Likely."  The Germans were seeking a loan to help pay World War I reparations, and the German Mark was showing signs of severe weakness.  JP Morgan Jr., and his partner Thomas Lamont (acting as advisors) were eager to facilitate, as long as certain conditions were met, including Allied unanimity regarding the terms. France made sure such unanimity was never achieved.

It was understood, as far back as 1918, that Germany would not be able to repay her debts all at once, and a loan would most likely be necessary. Thomas Lamont told President Woodrow Wilson in 1918 that

"when the war is over, and Germany has to pay a big indemnity, you will find the allies lending the money to Germany to pay her indemnity...I suppose it sounds fantastic to say that we should lend our enemies the money, but that's what will happen. I have just been reading what occurred after the Franco-German war of 1870. At that time France had to pay Germany, and she borrowed the money and the investors in the other European countries, including Germany herself lent that money. It may not be popular to write about it now, but keep it in the back of your mind for future use."

David Lawrence wrote in the Evening World in May 1922, 

"if Germany could have secured a loan immediately upon the close of the war she would not have been so adversely affected in the exchange market and she would have been able to purchase from American manufacturers much of their surplus stock of necessities. Germany would have gotten much of what she was deprived of through four years of a blockage and America would have captured an important market.

But instead Germany was treated as an isolated factor without thought of the effect of her economic condition on the rest of the world."

Image from Library of Congress: Delilah, representing the Republic of France, prepares to weaken Samson, resting on a pillow marked "Europe," by cutting his hair.

Friday, May 24, 2013

May 24 (1626, 1941) Peter Minuit buys Manhattan; Happy Bday Bob Dylan! "Old New York City is a friendly old town"

In the letter, dated November the 5th 1626 and directed to the States General, WIC-administrator Pieter Schagen described the situation of New Amsterdam. Among other things he mentioned the fact that the island of Manhattan had been purchased from the Indians for goods worth sixty Dutch guilders.

On this day in 1626, Peter Minuit purchased Manhattan from the Lenape Indians.

The purchase price of 60 guilders (roughly translated to $24) is often cited as evidence of the one-side nature of the transaction, though, it's possible that both parties left feeling satisfied.  At the time, Native American tribes simply did not think of land as something that could be sold, and most likely were happy to receive intangible benefits such as a military alliance against rival Indians and increased trade. Indeed, Mr. Minuit's reign as governor of New Amsterdam is remembered for its relative peace and stability.

The purchase of Manhattan has inspired many pop culture renderings including one by singer-songwriter Bob Dylan, who was born on this day in 1941 (he turns 71). Below are excerpts from his song "Hard Times in New York Town."

Mister Hudson come a-sailin’ down the stream
And old Mister Minuet paid for his dream
Bought your city on a one-way track
’F I had my way I’d sell it right back
And it’s hard times in the city
Livin’ down in New York town

I’ll take all the smog in Cal-i-for-ne-ay
’N’ every bit of dust in the Oklahoma plains
’N’ the dirt in the caves of the Rocky Mountain mines
It’s all much cleaner than the New York kind
And it’s hard times in the city
Livin’ down in New York town

So all you newsy people, spread the news around
You c’n listen to m’ story, listen to m’ song
You c’n step on my name, you c’n try ’n’ get me beat
When I leave New York, I’ll be standin’ on my feet
And it’s hard times in the city
Livin’ down in New York town

Image is a letter, dated November the 5th 1626 and directed to the States General, Pieter Schagen describing the situation of New Amsterdam. Among other things he mentions the fact that the island of Manhattan had been purchased from the Indians for goods worth sixty Dutch guilders. Library of Congress

Thursday, May 23, 2013

May 23 (1934) Bank robbers Bonnie & Clyde ambushed in Louisiana "They wouldn't give up till they died"

On this day in 1934, Clyde C. Barrow and Bonnie E. Parker were gunned down in a remote area of Louisiana after years on the lam.  It was the nadir of the depression, with the unemployment rate exceeding 20%, the foreclosure rate over 12%, and the South and Midwest (where most of their crimes occurred) mired in a catastrophic drought.

In his book Go Down Together: The True, Untold Story of Bonnie and Clyde, Jeff Guinn argues that Bonnie & Clyde's murderous rampage attained mythical status in part because robbing banks and killing law enforcement officials was seen as a revolt against an uncaring system.

Ms. Parker helped foster this image with her poetry, most of which she penned in a bankbook

Below is an excerpt from her poem "The Story of Bonnie and Clyde."

They call them cold-blooded killers;
They say they are heartless and mean;
But I say this with pride,
That I once knew Clyde
When he was honest and upright and clean.

But the laws fooled around,
Kept taking him down
And locking him up in a cell,
Till he said to me,
"I'll never be free,

So I'll meet a few of them in hell."

The road was so dimly lighted;
There were no highway signs to guide;
But they made up their minds
If all roads were blind,
They wouldn't give up till they died.

Image from

Wednesday, May 22, 2013

May 22 (1918) National Banks Authorized to Subscribe to Red Cross; "necessary for the continued prosperity of the enterprise"

Poster showing a young woman clutching an American flag as she calls out, with Red Cross symbol and U.S. Capitol in background. c1918

On this day in 1918, the US Congress amended the National Bank Act to authorize national banks to give a portion of their net earnings to the American Red Cross.  It was part of President Woodrow Wilson's "Red Cross Week" which ran May 20-27.  

The campaign was very successful, well exceeding campaign goals, and today is a case study in effective advertising. The campaign not only inspired people to give to a very unpopular war, it created intense amounts of pressure to do so.  So much, in fact, that Albert S. Gilbet, Esq. argued to the Internal Revenue Service that contributions to the Red Cross were a "necessary" expense and therefore should be deductible. His argument was reprinted in the New York Times in March 1919.

"It must be borne in mind that practically every business trade and profession was organized for the purposes of these drives. It must be borne in mind too that tags, report cards, and other evidentiary matter was distributed indicating the concern or concerns that did not contribute to these drives. 

In what position would a concern find itself if it became know that it had refused to contribute? How long would a retail establishment survive a public statement that it had refused to contribute to the Red Cross or for the relief of soldiers' families, and how far do you suppose an explanation would go with the public if the Directors had no power to make those contributions? 

Whether in fact the contributions were made because of the patriotic interest of the Directors and officers of the corporations or whether they were made because of the conditions as I have described them, the fact remains that they were absolutely necessary for the life and continued prosperity of the enterprise."

Image from the Library of Congress

National Bank Act

Wikipedia Entry defining National Bank Act

Advertising Educational Foundation "Red Cross Week" Case Study,

Mr. Gilbert's Letter in the New York Times

Tuesday, May 21, 2013

May 21 (1881) Clara Barton forms American Red Cross to "compass & shelter the relief of the nation"

Clara Barton circa 1904

On this day in 1881, at the age of 60, Clara Barton founded the American chapter of the Red Cross. She funded it primarily with her own money, most of which she earned while working in the US Patent Office, where she received a salary on par with her male colleagues.  "I may sometimes be willing to teach for nothing," Ms. Barton said, "but if paid at all, I shall never do a man's work for less than a man's pay."  

Ms. Barton spent the Civil War assisting wounded soldiers.  When she visited Switzerland in 1869 ("in search of a much needed rest" according to her colleague Walter Phillips), she was introduced to a wider field of service through the Red Cross in Geneva. Ms. Barton eventually convinced the US to sign the Geneva Treaty, and created the American Red Cross on this day in 1881.  

When she stepped down from President in May 1904, she reflected on the organization she created in her letter of resignation, reprinted in The Evening Star

"Although its growth may seem to have been slow, it is to be remembered that it is not a shrub or plant to shoot up in the summer and wither in the frost. The Red Cross is a part of us, it has come to stay and, like the sturdy oak, its spreading branches shall yet compass and shelter the relief of the nation." 

Image from the Library of Congress.

Monday, May 20, 2013

William Fargo and Wells Fargo’s West

Wells Fargo Express Co. Deadwood Treasure Wagon and Guards with $250,000 gold bullion from the Great Homestake Mine, Deadwood, S.D., 1890

Both William George Fargo and the iconic bank that bears his name were born on May 20, in 1818 and 1852 respectively.

Wells Fargo & Co. started out as an express mail business. Today the Wells Fargo stagecoach holds an almost mythical place in Western lore, in part because it served a vital function for the growing nation.  Its mail delivery service made it possible for people to communicate--to stay connected--across the country's great, new expanse, a service the US Postal Service was not able to provide as cheaply and effectively.

A proposed tax on mail delivered on the overland mail route (then managed by Wells Fargo) that made getting newspapers and other periodicals prohibitively expensive was viewed as "a tax upon the intelligence of the people of the Territories."

At a senate hearing, Congressman James Cavanaugh from Minnessota (and a delegate from the Territory of Montana) described the importance of affordable mail delivery for Westerners.

"We are a reading people in the West. It is not the fossilized remnants of civilization that go to the West, but young men with living blood in their veins. 

It is the poor young men and not the wealthy who go West; the young, the middle-aged, and old men of energy and pluck from New England and the middle states; and sir they go to reap fortunes in the development of the great resources which God in his wisdom has hidden in our mountains, men who create and build up new states, who found new Commonwealths, who add new stars to the national flag, who lay broad and deep the foundations of civilizations in the hitherto unknown sections of the continent, the axe and the rifle lead, the church and school-house follow.

"We hope to see terms such that we may not see the desires of the West for intelligence limited to so many pounds avoirdupois."

Image from the Library of Congress

Sunday, May 19, 2013

May 19 (1903) President Roosevelt leaves Yosemite with optimism "I believe in you"

"There can be nothing in the world more beautiful than the Yosemite, the groves of giant sequoias and redwoods." Outdoor Pastimes of an American Hunter 1905

On this day, May 19, 1903 President Roosevelt left the Yosemite Valley. The San Francisco Call reported that several in his party had never seen him so buoyant and rested. The crisp mountain air seemed to have given him a new lease on life. The President remarked on his amazing appetite, and how good everything tasted in the woods.

While travelling the President expressed optimism about America's future.

"I fail to see how any public man cannot believe in the future of this country after he has gone as I have gone from one side of the continent to the other...

"I am glad that the soil and climate here are such as to give the us that indispensable base of material...but gentlemen and ladies, the thing that pleases me most, even more than the crops, is the men and women I meet (applause). I believe in your future because I believe in you, not only in the climate and soil. You can take the best climate and the best soil and put a poor shiftless, trifling creature on the soil and you do not get any results.

I believe in brilliancy, not in genius. I believe in the ordinary humdrum work-a-day virtues that make a man a good man in his family, a good neighbor, and a good man to deal with in business, a good man to deal with in the state, and when you have a man with these characteristics in him you have a man who, if need comes, will rise level to that need."

Image from Theodore Roosevelt Association.

Saturday, May 18, 2013

May 18 (1872) Supreme Court affirms separate but equal in Plessy v. Ferguson; "It is to be regretted"

"The Great Dissenter" Justice John Marshall Harlan

On this day, May 18, 1896, the Supreme Court validated the statue of the State of Louisiana requiring railroads to supply separate coaches for white and black persons. Former Kentucky lawyer and politician, Justin John M. Harlan issued a powerful (if singular) dissenting opinion. Among other things, he points out the incoherence of sanctioning the violation of civil rights in a public space, and then allowing states to punish private companies for so doing.  Excerpts below.

"It is one thing for railroad carriers to furnish, or to be required by law to furnish, equal accommodations for all whom they are under a legal duty to carry. It is quite another thing for government to forbid citizens of the white and black races from traveling in the same public conveyance, and to punish officers of railroad companies for permitting persons of the two races to occupy the same passenger coach. 

If a State can prescribe, as a rule of civil conduct, that whites and blacks shall not travel as passengers in the same railroad coach, why may it not so regulate the use of the streets of its cities and towns as to compel white citizens to keep on one side of a street and black citizens to keep on the other? 

...In view of the Constitution, in the eye of the law, there is in this country no superior, dominant, ruling class of citizens. There is no caste here. Our Constitution is color-blind, and neither knows nor tolerates classes among citizens. In respect of civil rights, all citizens are equal before the law. The humblest is the peer of the most powerful...

It is therefore to be regretted that this high tribunal, the final expositor of the fundamental law of the land, has reached the conclusion that it is competent for a State to regulate the enjoyment by citizens of their civil rights solely upon the basis of race...

...The thin disguise of  'equal' accommodations for passengers in railroad coaches will not mislead anyone, nor atone for the wrong this day done."

Friday, May 17, 2013

May 17 (1792) the New York Stock Exchange is formed; Tontine Coffee House forms Tontine

On this day May 17, 1792, the Buttonwood Agreement was signed by twenty-four stock brokers outside of 68 Wall Street New York under a buttonwood tree, forming what would eventually be called The New York Stock Exchange.

Starting in 1793, these brokers would conduct their business in the Tontine Coffee House

At its extreme, a "tontine" is an investment plan that increases proceeds to survivors as the pool of investors die.  This financial innovation was developed by Neapolitan banker Lorenzo de Tonti in the 17th century.

Writing in the Fordham Journal of Corporate & Financial Law, Kent McKeever notes that the Tontine Coffee House itself was financed through a tontine.  Mr. McKeever also notes that many dramatic renderings have been inspired by tontines, including a 1996 episode of "The Simpsons" entitled "Raging Abe Simpson And His Grumbling Grandson in 'The Curse of the Flying Hellfish'."

Burns: Then it's agreed. Of course, we can't sell the paintings now, we'd be caught. How many of you are familiar with the concept of a "tontine"? 

[all stare at him, until Ox raises his hand]  

Burns: All right, Ox. Why don't you take us through it? 

Ox: Duh, essentially, we all enter into a contract whereby the last surviving participant becomes the sole possessor of all them purty pictures.  

Burns: Well put, Oxford.

Image taken from the Library of Congress - The Tontine Coffee House, Wall & Water Streets, about 1797

Thursday, May 16, 2013

May 16 (1843) 1,000 head to OR from MO; "We do not believe that nine-tenths of them will reach the Columbia alive"

Topographical map of the road from Missouri to Oregon, commencing at the mouth of the Kansas in the Missouri River and ending at the mouth of the Walla-Wallah in the Columbia.

On this day May 16, 1843, the first major wagon train heading for the Pacific Northwest set out from Elm Grove, Missouri. It was the beginning of the "Great Migration" West via the Oregon Trail. Thousands more would make the trek every year, greatly expanding both America's geography as well as its economy.

There was skepticism regarding their ability to survive the journey. The New York Tribune reported 
"we do not believe that nine-tenths of them will reach the Columbia alive...

Regarded in its individual aspect, this migration of a thousand persons in one body to Oregon wears an aspect of insanity. 

What seek they? A good climate? There is none finer in the world than the one that they leave behind. 

Good soil which they can own and till? There is none better than the millions of acres they pass unheeded, which they can posses without molestation, and only pay ten shillings an acre for it when they please. 

Good schools, churches, markets, bridges &c., &c.? All these they cast away, and cannot expect to find them again for many years. Cattle are very scarce in Oregon, and a plow there will cost as much as a horse here. 

For what then do they brave the desert, the wilderness, the savage, the snowy precipices of the Rocky Mountains, the weary summer march, the storm-drenched bivouac, and the gnawings of famine? Only to fulfill their destiny!"

Wednesday, May 15, 2013

May 15 (1911) US Supreme Court Orders Standard Oil to Dissolve "Enormous and unreasonable profits"

Political cartoon showing a Standard Oil tank as an octopus with many tentacles wrapped around the steel, copper, and shipping industries, as well as a state house, the U.S. Capitol, and one tentacle reaching for the White House.

On this day, May 15, 1911 the US Supreme Court found the Standard Oil Company of New Jersey in violation of the Sherman Antitrust Act, arguing that the company monopolized the petroleum industry through uncompetitive and abusive practices, and ordered its dissolution within six months.

Though the Sherman Act was signed into law in 1890, it wasn't until Theodore Roosevelt's administration that the law was fully enforced.

Below is an excerpt from the ruling which articulates the evil vs. good debate regarding monopolies, arguments echoed today.

"The Standard Oil Company of New Jersey -- with the vast accumulation of property which it owns or controls, because of its infinite potency for harm and the dangerous example which its continued existence affords, is an open and enduring menace to all freedom of trade, and is a byword and reproach to modern economic methods.

"On the other hand, in a powerful analysis of the facts, it is insisted that they demonstrate that the origin and development of the vast business which the defendants control was but the result of lawful competitive methods, guided by economic genius of the highest order, sustained by courage, by a keen insight into commercial situations, resulting in the acquisition of great wealth, but at the same time serving to stimulate and increase production, to widely extend the distribution of the products of petroleum at a cost largely below that which would have otherwise prevailed, thus proving to be, at one and the same time, a benefaction to the general public as well as of enormous advantage to individuals."

Image taken from Wikimedia Commons, originally published in Puck, v. 56, no. 1436 (1904 Sept. 7). Summary: Political cartoon showing a Standard Oil tank as an octopus with many tentacles wrapped around the steel, copper, and shipping industries, as well as a state house, the U.S. Capitol, and one tentacle reaching for the White House.

Tuesday, May 14, 2013

May 14 (1929) "Fresh danger of excessive speculation in the stock market..." W.R. Burgess anticipates trouble in NY

Image of flappers during the Roaring 20s

On this day, May 14, 1929 the Pittsburg Press cited a new survey of money and credit published in the journal Recent Economic Changes, and co-written by the future president of the American Bankers Association, W. Randolph Burgess.

According to the Press, Mr. Burgess' report expressed concern that the demand for loans seems almost without limit and is not checked by advances in interest rates. "This cannot fail to affect unfavorably the development and functioning of the New York money market as a great and reasonably stable and national world financial center."

Despite the growing concern by bankers and businessmen alike of excessive "absorption of credit in the stock market" (at that time, many investment were made "on margin" ie. with borrowed money), the report observed that the relatively new Federal Reserve had not "been tested" to effectually restrain "intense speculative activity through sharp and even drastic action."

Speaking to the Detroit Stock Exchange in January 1929, the head of the New York Stock Exchange E.H.H. Simmons defended speculation. "Speculation is an inseparable, integral and indispensable feature of all business and trade, and to attempt to abolish it would be utopian and impossible" reported the New York Times in January 1929.

Later that year, the stock market would be in free fall.

Mr. Burgess made this concession is his report. "Unfortunately, overexpansion of credit is very difficult to diagnose, not only at the time of its occurrence, but even after the event."

Monday, May 13, 2013

May 13 (1907) San Francisco Streetcar Strike: "Motormen and conductors wanted: Experienced, sober, intelligent..."

This image is a view of Market Street during the Strike of 1907

On this day May 13, 1907, the San Francisco Call reports "Car Service Resumed on Market Street: Police Maintain Order and Peace Remains on the Sabbath."

The city was in the midst of the Strike of 1907. The "Carmen" of the United Railroads (as the streetcar drivers were called) wanted a 20% pay increase (to equal their counterparts in Oakland) and an 8-hour workday (from the current 10 hours).

Starting on May 5 and lasting until November, it was one of the longest and bloodiest strikes in US history, claiming 31 lives and injuring 1100. 

In the end, the strike was a blow to the labor movement.  The president of United Railroads Patrick Calhoun replaced striking workers with the help of professional strike breaker James Farley who provided armed "scabs." Mr. Calhoun also attracted workers from the East by placing ads in Eastern newspapers such as the following:

Motormen and conductors wanted:
Experienced, sober, intelligent and industrious men. For further particulars address the United Railroads, San Francisco.

Writing in the Southern California Quarterly, Richard Gribble writes "The 1907 San Francisco Carmen's strike typified the struggle which existed between labor and capital in the Progressive era. Labor continually pressed for improved working conditions and remuneration and the principal of the closed shop. Capital fought to maintain control of labor and the work environment." (Spring, 1991). 

Image taken from, with this caption: "View of Market Street during the Strike of 1907."

Sunday, May 12, 2013

May 12 (1925) "It's tough to make predictions, especially about the future”

Image of Yogi Berra as barefoot sandlotter in St. Louis in mid-1930s.

On this day in 1925, baseball hall of famer and one of the "Wisest Fools of the Past 50 Years"(according to The Economist), Lawrence Peter "Yogi" Berra was born. Yogi transformed himself from barefoot sandlotter into one of the greatest catchers and clutch hitters in baseball history.  He is also quoted more than most poets, writers, speakers, well, anyone.  Below are some of his gems, courtesy of the Yogi Berra Musuem & Learning Center.

"It ain't over 'til it's over"

"It's deja vu all over again"

"When you come to a fork in the road ... take it"

"I usually take a two hour nap from one to four"

"Never answer an anonymous letter"

"I didn't really say everything I said"

"I want to thank you for making this day necessary"

"We made too many wrong mistakes"

"You can observe a lot by watching"

"The future ain't what it used to be"

"It gets late early out here"

"If the world were perfect, it wouldn't be"

"If the people don't want to come out to the ballpark,  nobody's going to stop them"

"Pair up in threes"

"Why buy good luggage, you only use it when you travel"

Saturday, May 11, 2013

May 11 (1906) "The Skyscraper is not to be tabooed"

The San Francisco Call reports on this day, May 11, 1906 that San Francisco merchants and property owners are eager to start rebuilding after the devastating earthquake and fire that destroyed the city on April 18. "The skyscraper is not to be tabooed...The lessons of the earthquake taught that the high building is a safe institution and it will be recommended that no such restrictions be imposed as has been proposed."

Priority was placed on re-building over remodeling, and the city was reconstructed essentially as it was before the devastation. Property-owners in Chinatown demanded "Chinatown will be rebuilt on the old site or it will not be rebuilt at all." Some argued it should be moved the more isolated Bay View Hunters Point.

Within six weeks, San Francisco's banks were open again. By June, bank clearings touched $30 million, more than any West Coast city.

Image: St. Francis Hotel, Fairmont Hotel in distance showing clean sweep of fire in business section of all except class A steel frame buildings.

Friday, May 10, 2013

May 10 (1837) NY Banks say paper (specie) not worth paper it's written on; Panic ensues

On this day, May 10 in 1837, New York banks stopped redeeming paper and coins (specie) at full face value. Depositors demanded to have their deposits withdrawn causing several bank failures. A depression followed that lasted until the 1843.

The above cartoon, created in 1837 by Edward Williams Clay and currently at the Library of Congress provides a commentary on the depressed state of the American economy, particularly in New York, during the financial panic of 1837. 

"The blame is laid on the treasury policies of Andrew Jackson, whose hat, spectacles, and clay pipe with the word "Glory" appear in the sky overhead. Clay illustrates some of the effects of the depression in a fanciful street scene, with emphasis on the plight of the working class. A panorama of offices, rooming houses, and shops reflects the hard times. The Customs House, carrying a sign "All Bonds must be paid in Specie," is idle. In contrast, the Mechanics Bank next door, which displays a sign "No specie payments made here," is mobbed by frantic customers. Principal figures are (from left to right): a mother with infant (sprawled on a straw mat), an intoxicated Bowery tough, a militiaman (seated, smoking), a banker or landlord encountering a begging widow with child, a barefoot sailor, a driver or husbandman, a Scotch mason (seated on the ground), and a carpenter. These are in contrast to the prosperous attorney "Peter Pillage," who is collected by an elegant carriage at the far right. In the background are a river, Bridewell debtors prison, and an almshouse. A punctured balloon marked "Safety Fund" falls from the sky. The print was issued in July 1837. A flag flying on the left has the sarcastic words, "July 4th 1837 61st Anniversary of our Independence."

Thursday, May 9, 2013

A Pair of Home-made Socks"

Red Cloud circa1890, 22 years after Lakota and Cheyenne warriors drove the U.S. Army out of the Powder River Basin in the Red Cloud War.

The New York Tribune reports on this day, May 9, 1866 that the "Commissioner of Indian Affairs is making affairs to hold a council with Indians of the Plains at Fort Laramie...E.B. Taylor, Superintendent at Omaha, states that 20,000 Indians will attend and desires to know of subsistence can be furnished them."

The discovery of gold in 1863 around Bannack, Montana encouraged white settlers to find an economical route to the gold fields. Securing safe passage, however, was difficult. In autumn 1865, several treaties were negotiated with Lakota, Cheyenne, and Arapaho leaders, however, none had the endorsement of the Indian Chief Red Cloud, and proved unenforceable.

No white man could be found to undertake a dangerous mission to find Red Cloud and bring him to Fort Laramie for negotiations. Several of the "Laramie Loafers" undertook the task, and in March of 1866 Red Cloud and his Oglala rode into Fort Laramie, and committed to remain peaceful until such time as the U.S.'s chief negotiator, E. B. Taylor, arrived with presents for the assembled Indians.

Negotiations began in June, and quickly fell apart. The US arrived at Fort Laramie with two battalions and orders to establish forts in the Powder River country along the old Oregon Trail, now the Platte Road. Red Cloud refused to acknowledge the US Colonel Henry B. Carrington and accused the U.S. of bad faith in the negotiations. Red Cloud's War had begun.

The Treaty of Fort Laramie was eventually signed in 1868.  It created the Great Sioux Reservation, including the Black Hills and all of South Dakota west of the Missouri River.

Below is an excerpt from the Treaty

In lieu of all sums of money or other annuities provided to be paid to the Indians herein named under any treaty or treaties heretofore made, the United States agrees to deliver at the agency house on the reservation herein named, on or before the first day of August of each year, for thirty years, the following articles, to wit:

For each female over 12 years of age, a flannel shirt, or the goods necessary to make it, a pair of woollen hose, 12 yards of calico, and 12 yards of cotton domestics.

For each male person over 14 years of age, a suit of good substantial woollen clothing, consisting of coat, pantaloons, flannel shirt, hat, and a pair of home-made socks.

Flannery O'Connor

You shall know the truth and the truth shall make you odd.