The place is Jekyll Island and the year is 1910. First, a brief history: Jekyll Island was and still is a beautiful island off the coast of Georgia that was once the stomping ground of many big names we still recognize today. The Rockefeller, Morgan, Vanderbilt, Pulitzer, and Baker families all participated in a hunting club located on the island in the 1800's.You can access this information on the island's website, however, the story I'm about to tell you is something the history tab on their website doesn't mention.
A meeting took place on the island in November of 1910 with the purpose of reforming the nations banking system. The six men that attended this meeting accounted for one-fourth of the nation's wealth. It all began with Senator Nelson Aldrich, followed by A.P. Andrews, Henry P. Davison, Paul Warburg, Frank A. Vanderlip, and Benjamin Strong. However, to keep their names a secret, they only gave out their first names to staff on the island, hence "the First Name Club." By the end of this meeting, a plan for a Reserve Association of America was set in place. This plan would include one central bank with fifteen branches across the country. In 1911 the plan was introduced to Congress under the name National Reserve Association but was shut down when Woodrow Wilson was elected and the Democrats controlled both houses. The idea of having a central banking system wasn't completely shunned though. After a couple of years, the Federal Reserve Act was put together, passed by Congress, and signed by the president in 1913. The final Act resembled many of the ideas Aldrich and his colleagues had put together on Jekyll Island. What's funny is that all of the men involved in the meeting that week on the island denied it even happened until the 1930's.
So, that's a little history on the Federal Reserve! If you knew about this little secret meeting then this served as a reminder, but if you didn't know about it, it's kind of interesting! This article kind of conflicts with the information I found on Wikipedia, specifically the names of who attended the meeting, but nevertheless, if you'd like to further read on the subject, here it is.
Now that that's out of the way, here's an intro vid to the main discussion. The Great Depression.
The Great Depression hit many hard. Our book points out that by 1922, our nation had just recovered from the industrial recession that had followed WWI. Along with this came the popularity of consumer goods such as automobiles, appliances, radios, movies, etc, all of which played a significant role in the growth of the economy. The book also points out that by 1929, production expanded at the rate of about 5 percent per year and factories were producing 64 percent more consumer goods than in 1920. The economy was almost growing faster than what we could keep up with and with credit and really just the culture of high consumption, we see what was once an exciting time full of hope spiral down into outright shock when the stock market crashed in 1929. In September of that year, stock prices in the market were up over 50 percent since the beginning of January. But unfortunately, the market was overvalued and unstable. On October 29th the market crashed resulting in the single largest one-day loss in history. This was the day that the optimistic attitudes of the 20's completely vanished. In the US, the unemployment rate rose to 25%. At the time Herbert Hoover was in office and the first thing he did after the market crash was cut taxes, assuring the country that the crash was just a setback. He didn't give a voice to the people suffering out on the streets, jobless and homeless. Hoover did eventually try and help by passing the Federal Home Loan Bank Act which aimed to reduce foreclosures and create housing, and by setting in place the Emergency Relief and Construction Act which helped fund public works. Then FDR came along with a new sense of optimism and a New Deal which consisted of different experimental projects and programs to help with the restoration of our nation's economy and our overall sense of being helped him win the election. Franklin D. Roosevelt was elected into office in 1932 winning by a LANDSLIDE. After all, "the only thing we have to fear is fear itself."
FDR wanted to preserve the free market system so he came up with reforms to help rebuild the economy. Within the first 100 days of his presidency, he began to give these experiments a go. The First New Deal consisted of closing down the nation's banks in order to pass the Emergency Banking Act (1933) which allowed only banks equipped to operate to reopen. He also took steps in ending Prohibition for good, making alcohol legal again! ~ cheers ~ He signed the Tennessee Valley Authority Act into law which enabled the construction of dams to control flooding and to create inexpensive power, set up the National Industrial Recovery Act which guaranteed workers the right to unionize, and also had many other laws passed which left the majority of Americans content. With the nation still in a depression, he set forth a series of even more aggressive reforms and programs called the Second New Deal. The Works Progress Administration (WPA) came of this which aided in providing jobs for the unemployed that focused on rebuilding cities. FDR also signed a Social Security Act, resulting in federal aid for many Americans. A lot of these programs are still set in place today.
It's interesting when you take the time to compare the Great Depression and the Great Recession. This article goes far more into depth than I ever could so if you have the time I encourage you to give it a look. :)
Sources used:
Becoming America Volume II: From Reconstruction by David Henkin and Rebecca McLennan
