Monday, March 24, 2014

Asheville's Depression Debt Redemption

Asheville, NC is home to the 2nd largest number of Art Deco buildings in the nation. The historic Legal Building traces its roots back to 1909, when downtown Asheville was entering its building heyday.
Asheville's historic Legal Building

On March 24, 1663, King Charles II granted a land charter for the Province of Carolina (named after his father, Charles I, Carolus being the Latin version of 'Charles') to eight Lords Proprietors, a form of repayment for their help in restoring him to the throne.

On another March 24, Samuel Ashe, the ninth governor of North Carolina, was born in 1725. Ashe is the namesake for many parts of the state, including Asheville.

The Miami Beach of the Mountains, Asheville is "the happiest city in America" according to Self Magazine. But it wasn't always so.

On November 20, 1930, eight North Carolina banks failed, including Asheville's largest Central Bank and Trust. Thousands lost their life savings, including the city itself. With $8 million gone in a single day, projects halted, employees lost salaries, the budget was cut in half.

An independent audit of the city's finances found that officials used public funds to try to save the bank. Their efforts were not appreciated. "Even if the city's commissioners pursued the course they thought best," the New York Times reported, "as public officials they have destroyed themselves plunged the city headlong into debt, betrayed their trust and forfeited the right to their possessions."

The bankers took this sudden loss of public confidence particularly hard. On February 17, 1931, the vice president of Central, Arthur R. Rankin, shot himself to death. Later that week, a bank cashier cut his throat but survived. On February 23, four days after bank and public officials were indicted for fraud and conspiracy, Asheville mayor Galatin Roberts went to the fourth floor bathroom of the Legal Building and shot himself in the temple. He left a note.

"My soul is sensitive and I am wounded unto death. God knows I did no wrong during my term in office. My hands are clean and my conscience is clear."

With the largest municipal debt per capita of any American city ever, Asheville experienced four decades of economic stagnation and population decline. Bankruptcy might have been easier, but the community refused. "We owe this money and we ought to pay it," Asheville city employee Weldon Weir explained. Each year as bonds were retired, the Asheville Citizen ran a headline "Bonds Cremated." The last payment was made in 1976.

Though it wasn't easy, the experience is treated as a blessing.  In the go-go 1960s when other cities were destroying buildings to "modernize" (e.g, New York's Pennsylvania Station), depression-era debt payments forced Asheville's skyline to stay beautifully stuck in Art Deco-y 1930, "and is why our historic fabric was not bulldozed," writes Ashevillenow.com.

Today, with debts repaid and conscience cleared, Governor Ashe's namesake town is a downright happy place to be.



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Flannery O'Connor

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