The United   States

Military

The United States military has a greater cause then what meets the eyes. It’s purpose is to Protect, Serve, Defend the interests of the United States of America. This is accomplished through a number of ways; primarily guaranteeing humankinds freedoms for those in pursuit of liberty and its basic democracies. But through all the relic(s) and political propagandas, lets take a closer look at what it takes to become the #1 Super Power on this planet also being mindful of the many years of ultimate sacrifices and casualties that this great nation has endured, in achieving one ultimate goal, FREEDOM!

 

 

 

 

 

 

 

The United States has a total of 5 military branches serving the interests of the people of this God great land. The Army military branch, which was founded by the Continental Congress in June of 1775, has a total of 561,984 in active personnel with 205,000 in reserve personnel findthedata.org. The average pay for an enlisted soldier of the Army for 4-years is $28,178.00.  According to online statistics;

“The United States Army is the main ground-force of the United   States. The Army’s main function is to protect and defend the United States (and its interests) by way of ground troops, armor (tanks), artillery, attack helicopters, tactical nuclear weapons, etc. The Army is the oldest U.S. Military service.”

The Airforce is the smallest of the military branches but serves as an instrumental factor to the military depending on the kind of warfare the US can be engaged in. This military branch is made up of 333,370 active soldiers. The average pay for an Airforce Cadet is $846.00 per month in serving this great mighty nation. According to online statistics;

“The primary mission of the Air Force is to defend the United States (and its interests) through exploitation of air and space. To accomplish this mission, the Air Force operates fighter aircraft, tanker aircraft, light and heavy bomber aircraft, transport aircraft, and helicopters (which are used mainly for rescue of downed-aircrew, and special operations missions). The Air Force is also responsible for all military satellites, and controls all of our Nation’s strategic nuclear ballistic missiles.”

The United States Navy was established in the same year the Army was established which was in 1775 by the Continental Congress. The Navy’s primary purpose is to maintain the freedom of the seas. The active duty Navy has about 54,000 officers, and 324,000 enlisted personnel with the average pay to be about and around $18,127 for an E-2 enistee.

“The Navy makes it possible for the United States to use the seas where and when our national interests require it. In addition, in times of conflict, the Navy helps to supplement Air Force air power. Navy aircraft carriers can often deploy to areas where fixed runways are impossible. An aircraft carrier usually carries about 80 aircraft. Most of these are fighters or fighter-bombers. Additionally, Navy ships can attack land targets from miles away (with very heavy guns), and cruise missiles. Navy submarines (fast attack and ballistic missile subs) allow stealth attacks on our enemies from right off their shores. The Navy is also primarily responsible for transporting Marines to areas of conflict.”

 

 

 

 

 

 

 

 

The few, The proud, The Marines! This motto is best known for the military branch of the United State Marines. The Marines was founded in 1778 by the Continental Congress. The Marines main purpose is to specialize in amphibious operations. Their primary specialty is to assault, capture, and control “beach heads,” which then provide different avenues to attack the enemy from any point source location. A private first classman (PFC) soldier in the US Marines earns around $20,398.00 per year.  

“For combat operations, the Marines like to be self-sufficient, as much as possible, so they also have their own air power, consisting primarily of fighter and fighter/bomber aircraft and attack helicopters. Even so, the Marines use the Navy for much of their logistical and administrative support. For example, there are no doctors, nurses, or enlisted medics in the Marine Corps. Even medics that accompany the Marines into combat are specially-trained Navy medics.” 

 

 

 

 

 

 

In total, there is an estimated 2,291,910 active/reserve soldiers, serving in today’s  United States military. China has an estimated 4,585,000 active/reserve military soldiers at their disposal. The Russia Federation has an estimated 3,524,000 active/reserve, North Korea with an outstanding 9,495,000

 

 Currently the United States rank #1 in Global spending on its military, which is projected to be slashed in billions by the year 2016. While the US military deploys its servicemen on bases around the globe, it is seen to provide World peace, along with humanitarian efforts, giving people a sense of security and hope which is truly needed in this day and age. The lingering question about how much we are supposed to spend on our military defense or military testing, is left to our country’s economists and political experts. In a society where world peace can be easily compromised in a blink of an eye, through nuclear programs, technological weaponry advancements, and strong military’s globally, it can be seen as neither a good idea or a bad idea investing in our own military.

 Our future spending, on current and future soldiers, deserve our country’s top dollar. We’ll eventually will work out the kinks to our defense budgets spending as issues arise, but the price to Protect, Serve, and Defend this great free Nation comes with no price-tag. We as Americans, don’t do enough for American Veterans who have already served this country, and that too needs to be addressed, however cutting back drastically on defense budgets in this country gives American soldiers a disadvantage in areas of technological advancements other countries are making with their military’s.

 

Sources:

1. Statistics for military services:

http://us-military-branches.findthedata.org/q/1/2405/How-many-active-personnel-does-the-US-Military-Branch-Army-have

2.  General military information 5 Branches:

http://usmilitary.about.com/cs/generalinfo/a/military101.htm

3. Army soldiers pay 4yrs:

http://www.goarmy.com/benefits/money/basic-pay-active-duty-soldiers.html

4. Pay rate for Air Force cadet:

http://www.usafa.af.mil/information/factsheets/factsheet.asp?id=9420

5. Pay rate for Navy military:

http://www.navy.com/joining/benefits/military-pay.html

6.  Pay rate for Marines:

http://www.militarypaychart.us/marine

7.  Military by the Numbers:

http://en.wikipedia.org/wiki/List_of_countries_by_number_of_military_and_paramilitary_personnel

8. Active Duty Military Personnel, 1940–2011

http://www.infoplease.com/ipa/A0004598.html

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The Bessemer Process
Importance of The Bessemer Process:

   Widely impacting the US’s construction of everything from buildings, boats, bridges, and railroads. The Bessemer process is one of the most important discoveries in steel manufacture. Reducing the cost, time, and labor needed to make steel through this valuable process, allowed the transition between construction through wrought iron possible, and allowed the creation of some of the most incredible construction projects in history.

History:

Discovered in 1855 by Sir Henry Bessemer. The Bessemer process was discovered through Sir Henry’s attempts to manufacture steel faster and more cheaply. Particularly for the purpose of manufacturing military weapons, which were at the time made with iron, which is considerably heavier than steel. At the time, steel was only used for generally small items; forks, spoons, and tools. However, the ability to make widespread military use of steel was very appealing because of steel’s strength and reduced weight in comparison to wrought iron.

Working with a standard reverberatory furnace, Henry made the accidental discovery of hot air’s effect upon iron, the hot air alone converted the outsides of pig iron into steel. He then completely redesigned his furnace, by creating what’s known as a Bessemer furnace, doing this allowed forced hot air through the molten iron with special air pumps. Generally, one would assume that air would cool the iron rather than burn it hotter. However, oxygen in the forced air ignited impurities of silicon and carbon within the iron. This reaction would then increase the iron’s temperature, and therefore burn out more and more impurities in the iron. Which made the conversion to steel much easier than before.

Below is the process in which a Bessemer furnace works:

http://youtu.be/_kSp5K70cYc

Manufacture through the Bessemer process began in a wider scale in 1858, By W and J Galloway using imported pig iron from sweden. The firm of W and J Galloway were the first company to license Sir Henry’s patent of the Bessemer process.

Importance:

The Bessemer Process impacted industry and labor in so many ways. Allowing steel to be manufactured at much higher rates. Dramatically reducing the cost of manufacture, originally the cost to make steel from iron was roughly £40 per ton, but once the Bessemer process was introducing the price was dropped to between  £6–7 per ton. This brought the price right down to the same ballpark as wrought iron. Prior to this process, iron was the main material for things like bridges and bulding frames, now that steel was accessible it became the main component in these types of construction. With reducing the time it took to create the steel brought the cost of labor down as well.

Although the Bessemer process was replaced by the Basic Oxygen process in 1968. The Bessemer process had an immeasurable impact upon the US economy, manufacturing system, and work force. It allowed steel to become the dominant material for large construction, and made it much more cost effective. Countless millions of tons of steel were manufactured in this manner and countless buildings, bridges, and boats were made with the resulting steel crop, stimulating the US economy in every way possible.

Sources:

http://www.tc.umn.edu/~tmisa/NOS/1.2_invent.html

http://www.youtube.com/watch?v=_kSp5K70cYc

http://en.wikipedia.org/wiki/Bessemer_process#History

http://en.wikipedia.org/wiki/Reverbatory_furnace

 

The Currency Act

Passed by the British Parliament on September 1, 1764, and sought out by George

 Grenville, was The Currency Act.  This act was passed in hope to reduce the British

National debt and in hope that it would boost the British Economy.

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Why?

The British were in debt during the French and Indian war, the debt continued after the war

when the British had to continue to station troops in America.  Once the war was over,

the colonial traders did not have enough buyers for their products, which resulted in the down-

fall of the British economy.

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What?

The Currency Act of 1764 was a more in depth version of The Currency act of 1751.  In 1751 the

act forbid the New England Economies from issuing paper money.  Paper money that had

already been issued was to only be used for paying debts. In 1764 when the new version

was passed, it prohibited ALL the colonies from issuing new bills and it prohibited the use of

already issued currency that was past its expiration date.

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Outcome:

The Currency Act of 1764 backlashed.  While the British were expecting this

to help them it made it worse.  The trading industry died down because

the act made it less smooth to trade goods.  Also because they weren’t allowed to use paper

bills for anything other than debts, colonies ran out of things to trade because they didn’t have

any resources left.  The act also caused a lot of resentment among the colonies.

________________________________________________________________________________________________________________________________

By: Lauren Hoisington

Sources

http://www.revolutionary-war-and-beyond.com/currency-act.html#galler

http://www.stamp-act-history.com/timeline/1764-currency-act/y[pageGallery]/0/

Samuel Brannan

The First Millionaire of the West

Who was Samuel Brannan?

Samuel Brannan was considered the first millionaire west of the Mississippi. He became a millionaire during the California gold rush in 1849 by capitalizing on the needs of miners. He created a monopoly over mining goods and supplies in California.

Sam was born in Saco, Maine in 1819. He grew up as a member of the Mormon church, the Latter Day Saints. Sam later moved to Ohio in 1844 to help out with his church. It was here he learned about journalism and printing. When the center of his church relocated to California in 1846, Sam went with them with the intent to help lead. Moving to California would turn out to be both the best and worst things he could possibly do.

Samuel Brannan and his Millionaire Monopoly

Sam heard gold had been discovered. So he started buying gold at a cheap rate from early miners with money he stole from the church and resold it for a large profit. He the used the  money he was making from buying and selling gold to buy up all the available mining supplies in San Francisco. He published news of the gold findings in his paper, the California Star.

Once word spread of all the undiscovered gold available in California, the gold rush began. Same owned the only supply store between the mining fields and San Francisco. So every single miner that came out for gold had no choice but to stop at the store owned by Sam Brannan. He eventually opened several more stores. His first store was selling $150,000 a month in goods and supplies in 1849 (almost $4 million in today’s money).

Samuel also increased his fortune in other ways. He had several luxury hotels built in various cities in California. He also created a successful ship trade with China and the east coast.

Crime was very high in San Francisco due to the large volume of people and the large amount of gold and money. The average murder rate was 49 per 100,000 people. So to help maintain his own control over much of San Francisco, Samuel formed the San Francisco committee of Vigilance. It was an unofficial citizens police force. Unfortunately Samuel was part of a group in this committee that was accused of helping to kill in innocent man. This event would get him removed form the Latter Day Saints.

After the gold rush things started going bad for Samuel Brannan. Being removed from his church that he was

 member of most of his life, and marital problems with his wife were just a few. His wife filed for divorce and he would eventually lose most of his fortune to this. Samuel Brannan died alone, homeless and penniless on May 6, 1889 in Escondido, California.

Samuel Brannan and his Legacy

By publishing the finding of gold in California in his news paper, he essentially created the gold rush and was the cause of so many people making the long journey to California. If he hadn’t published this, would the news still have made it to east coast? Or would the California gold rush not have happened as fast as it did. We will never know.

Sam Brannan helped the California economy in many ways. He basically helped to increase the population, therefore stimulating the local economy. He helped form the

 

 

Society of California Pioneers to develop banks, railroads, and telegraph companies. He also played a large part in a company that initiated the development of the now largely populated Los Angeles County.

Samuel Brannan is an example of how a single person can affect the economy of our country on multiple levels and over a long period of time. We as Americans have been, and always will be a capitalistic society as Samuel Brannan demonstrated. He played a large role in Californian economic history.

 

 

Sources

http://www.spartacus.schoolnet.co.uk/WWbrannan.htm
http://en.wikipedia.org/wiki/Samuel_Brannan
http://dsc.discovery.com/tv-shows/gold-fever/bios/sam-brannan.htm
http://napavalleyregister.com/inv/lifestyles/sam-brannan-pioneer-dreamer-and-scoundrel/article_600ee514-3ae9-11e0-8969-001cc4c002e0.html

           Samuel Morse was born on April, 27, 1791, in MA. A student at Yale, he was interested in art and electricity (a new concept of its time). After Yale, he became a painter. After hearing about a newly discovered electromagnet while sailing home from Europe in 1832, he came up with an idea of developing an electric telegraph. The next several years were spent developing a prototype for the invention. Two people assisted him in the development, Leonard Gale and Alfred Vail.

          The Telegraph is a machine that was used to transfer messages in the form of electrical impulses. Messages sent from it were called Telegrams; and the sender was called a Telegrapher. It was a major way of communicating in the mid 19th and late 20th centuries. Come the 21st century though it was made obsolete by things like phone calls, faxes and the birth of the Internet, Pictured below is the telegraph used to receive to the first telegram.

             The machine was demonstrated in 1838 with the use of Morse Code (dots and dashes representing letters & numbers). It would take the next 5 years in 1843 for Morse to finally convince a skeptical Congress to fund the building of the first telegraph line from D.C. to Baltimore. Below is a video of the first telegram “What hath God wrought?”

The First Telegram

             Over the next few years private companies began to emerge using Morse’s patent. In 1851, the New York and Mississippi  Valley Printing Telegraph Company was founded; later to be known as a very familiar company name that still exists today, Western Union. A decade after its birth, the company built the first transcontinental line across the United States. In 1866 the first successful permanent line across the Atlantic was finished, by this time the world had seen telegraph systems in 5 continents: North America, Africa, Asia, Australia and Europe.

Why was it important?

          Though the telegraph fell out of widespread use by early 21st century, it paved the way for future innovations that are still widely used every second of every day. The Telegraph laid the groundwork and was replaced by: the Telephone, Fax Machine and the Internet. With all these things in existence, media & communications have become big employers and healthy supporters of the economy.

Sources:

http://www.youtube.com

http://www.history.com

http://www.wisegeek.org

 

The Legacy of Jackie Robinson

Jackie Robinsons legacy will go down as one of the most prolific in sports history as well as in all of American history. Jackie paved the way for the civil rights movement. Not only his skill in athletics but his will and desire made Americans question the “seperate but equal” “equality” in America. I will be going over biography, his accomplishments, what he did outside of baseball and how all that he accomplished ties in to what we studied this year.

Biography

Jackie Robinson was born to a single mother in a sharecropping family in Georgia in 1919. As 1 of 5 kids Jackie grew up with much hardship and racism towards him and his family which only brought them closer together. He learned to make his way in his life, and ended up with varsity letters in 4 sports at UCLA, basketball, football, track, and of course baseball.  After monetary issues made Jackie have to leave UCLA he joined the army where he progressed through the ranks very quickly. After being court marshalled due to a “racial incident” he left the army. Shortly after he began playing in the negro league for the Kansas City Monarchs until 1947 when his life changed and he was approached by Branch Rickey to play for the Brooklyn Dodgers. Jackie was married and had 3 kids before he died in October 1972.

Few of many Accolades

• Broke the color barrier in major league baseball in 1947 by becoming the first African-American player and first African-American player to make the Hall of Fame.
• Named National League Rookie of the Year in 1947.
• Led the National League in stolen bases in 1947 and 1949.
• Led second basemen in double plays 1949, 1950, 1951 and 1952.
• Selected as the National League MVP in 1949
• Won the 1949 batting title with a .342.
• National League All-Star Team, 1949-1954.
• Had a career batting average of .311 with the Dodgers, .333 in All-Star games Led the Dodgers to six World Series and one World Series Championship in a 10-year span.

Outside of Baseball

Jackie Robinson was a large part in the movement and did many great things outside of baseball as well, including:

• Starred in “The Jackie Robinson Story” in 1950.
• Opened a men’s apparel store on 125th street in Harlem from 1952-1958.
• Signed a contract with WNBC and WNBT to serve as Director of Community Activities in 1952.
• Became Vice President of Chock Full O’Nuts in 1957.
• Served in numerous campaigns and on the board of directors for the NAACP from 1957-1967.
• Established the Jackie Robinson Construction Company in 1970 to build housing for families with low incomes.
• Wrote an autobiography “I Never Had It Made.”
• Helped establish the Freedom National Bank.

Tying it together with our class

Segregation in America was not good for the economy. Jackie Robinson with the help of many other people paved the way for a reform to the “seperate but equal” doctrine and segregation in the US. Desegregation gave African-Americans the right to go to better schools, get better jobs and have the oppurtunities that white people were already entitled to. With African-Americans having the right to get an education and be creative many things were invented that have been very successful in America including potato chips, the blood bank, gas masks, etc. In a diagram shown below it shows arguments of Douglas Massey and Nancy Denton in American Apartheid(Harvard UP, 1993) on how segregation causes poverty.

More information as well as explations for each example can be found on http://www.umich.edu/~lawrace/consequences.htm

Other sources I used throughout my project are

http://www.jackierobinson.com
http://www.history.com/topics/jackie-robinson

As the 20^th century neared and the American economy was undergoing continuous transformation, all was not well between labor and management.  The growing industrial labor force that helped power new industries and the many factories that came with them was experiencing long hours at low wages.  In this time of little government interference, management often sought out any way to keep profits rising.  Twelve hour work days, six-day work weeks and wage cuts were the norm.  Exhausted workers, tired of working in dangerous conditions for low wages, began to band together to force employers to treat them more fairly.  Such was the case at Andrew Carnegie’s steel plant in Homestead, Pennsylvania.

By 1890, Andrew Carnegie was the richest man in America, with an estimated net worth over $100 million.  His company, Carnegie Steel, was the largest steel producer in the country.  In the winter of 1891, the Homestead Mill, located in Homestead, Pennsylvania, became part of Carnegie’s steel empire.  Carnegie and his associate, Henry Clay Frick, had defeated the union at their other factories.  Despite his public stance as a champion of labor, Carnegie was determined to break the Amalgamated Association of Iron and Steel Workers at Homestead.  He hated how this craft union, not even inclusive of all workers, dared to decrease the efficiency of one of his plants.  Facing one of the strongest craft unions in the country, he had a difficult task.

Not wanting to dirty his hands and soil his reputation, Carnegie tasked Frick, the violently anti-labor General Manager of Homestead, with cutting wages and breaking the union while Carnegie vacationed in Scotland.  Anticipating the expiration of the union’s contract at the end of June, Carnegie and Frick schemed to produce as much steel product as possible in the spring of 1892 in order to weather a strike.  Frick also fortified the mill with a three-mile long, 10 foot high wall topped with barbed wire.  With his fort complete and large inventory on hand, Frick planned to shut down the plant and wait for the union to buckle if his terms for a new contract were not accepted.

As negotiations on a new union contract began, Frick announced his intentions to slash wages and cut jobs.  Neither Frick nor Carnegie expected the union to accept these terms.  They were correct.  As the end of June neared, Frick began to close the mills at Homestead and lock out the workers.  Then, on June 25^th, Frick declared that he would no longer recognize the union and would only negotiate with individuals.  The workers at Homestead were willing to bend on almost every issue during negotiations but they were not willing to disband their union.  Management had acted on the belief that employees would abandon their union to save their jobs.  They had not anticipated the resolve shown by the workforce at Homestead.

On June 29, Frick locked out all 3,800 employees at the mill.  Only 750 of the 3,800 workers belonged to the craft union, however, over 3,000 met and voted overwhelmingly to strike.  They guarded the plant all day and night, not willing to allow management to employ strikebreakers to run the mill.  Strike leader Hugh O ‘Donnell did not want any violence but the union members would not allow any scabs into their factory.  In response, Frick hired the Pinkerton National Detective Agency, a private police force with more men and guns than the U.S. military.  They were to protect the non-union scabs that would be hired to run the factory.  Frick thought a show of strength and resolve was all that was needed to break the workers. Again, management badly miscalculated.

On the morning of July 6, 1892, a tug pulled two barges containing 300 Pinkerton men down the Monongahela River.  They were preparing to secure the factory via a river entrance.  Union members and townspeople, tipped off about the arrival of the Pinkerton men, gathered by the thousands at the mill to prevent the agents from taking over the factory.  It is not known who fired first, but a fierce battle ensued when the Pinkertons attempted to take the mill.  Workers frantically tried to sink the barges.  They soaked a raft with oil, set it on fire and sent it afloat in an attempt to burn the agents out.  They tried to ram the barges with a burning rail car.  They employed dynamite and cannon fire.  The tugboat left the barges to ferry out wounded men, leaving the remaining agents stranded.  Several Pinkerton attempts at surrender were denied.  During this fighting, union leadership tried to defuse the situation behind the scenes but Frick would not bargain. He knew that the more chaotic events got, the better chance militia would be dispatched to safeguard his factory.  Finally, after more than twelve hours of brutal violence, surrender was negotiated with the safety of the Pinkertons promised.  Three Pinkertons lay dead and 9 workers had been killed or mortally wounded.

Despite the promise of safety for the Pinkertons, they were forced to walk through a gauntlet of angry townspeople on their march from the mill to Homestead.  During this walk, they were beaten badly with fists, rocks and clubs.  Many were seriously injured.  This beating and the subsequent reporting of it by the media turned many citizens against the strikers.  Upon arrival to the town, they were put into the jail for their safety and whisked away to Pittsburgh by train at night.  Despite assurances to the union that they would be prosecuted for their crimes, the Pinkertons were released by state officials without facing any charges.

Under pressure from Carnegie Steel and the Carnegie-backed political machine that helped to elect him, the governor of Pennsylvania ordered the state militia to Homestead to break the strike.  On July 12, 8,500 militiamen arrived by rail and quickly took back control of the plant.  Strikebreakers arrived by train and took over work in the mill.  By August, the factory employed 1,700 scab workers and the mill was running as usual.  The strikebreakers lived on mill grounds, as the town of Homestead was a dangerous place for them.  The strike continued on, with union requests for renewed negotiations ignored by Frick.

An assassination attempt on Frick by anarchist Alexander Berkman further undermined public support for the strike.  Although Berkman had no connection to the union, sympathy for the strikers had been eroded.  Strike leadership fell apart and workers went back on Frick’s terms.  The strike had failed and the union collapsed.  All strike leaders were blacklisted. Many strikers were arrested but sympathetic juries convicted none.

The crushing of the union during the Homestead Strike of 1892 was just one of many clashes between labor and management around the beginning of the 20^th century.  It was representative of many of the battles, as big business, with political and judicial backing, often triumphed over organized labor.

References:

http://www.pbs.org/wgbh/amex/carnegie/peopleevents/pande04.html

http://www.pbs.org/wgbh/amex/carnegie/sfeature/mh_horror.html

http://www.history.com/topics/homestead-strike/videos#homestead-strike

http://www.history.com/topics/homestead-strike/videos#andrew-carnegie-and-the-homestead-strike

http://www.youtube.com/watch?v=1NljbZAGk0w

The Early Years

Franklin Delano Roosevelt (FDR) was born on January 30^th, 1882, in Hyde Park, New York. He was born into a wealthy, prominent family that had made their fortune in real estate and trade. The only child of James and Sara Ann Delano Roosevelt, Franklin lived a very privileged childhood. He was educated by private tutors until the age of 14 when he began attending Groton School for boys, a prestigious preparatory school for boys in Massachusetts. Roosevelt graduated from Groton in 1900 and went on to attend Harvard University.

At Harvard, he joined the Alpha Delta Phi fraternity and became editor of the Harvard Crimson newspaper. He graduated in just three years. During his final year at Harvard, he became engaged to his fifth cousin Eleanor Roosevelt, the niece of his idol and distant relative, Theodore Roosevelt. They married on March 17, 1905. Franklin moved on to Columbia University Law School and in 1907 he passed the bar and left Columbia early. For the next few years, Franklin practiced law in New York but he did not find his career fulfilling. He made a decision to enter public service and delved into the world of politics, a career that had always held his interest.

FDR The Politician

In 1910 at the young age of 28, FDR ran for the New York State Senate. Despite a strong Republican family background as well as a strong Republican history in his district, Roosevelt ran on the Democratic ticket and with the help of his well-respected last name, was the first Democrat to be elected in 16 years. Roosevelt was reelected in 1912 and served as chair of the agricultural committee, where he was successful in passing farm and labor bills and social welfare programs. During the same year, FDR supported Woodrow Wilson at the Democratic National Convention, who returned the favor by appointing him Assistant Secretary to the Navy. This was the exact position Theodore Roosevelt had used to propel himself toward presidency. Two short years later, FDR ran for the US Senate seat for New York but was unsuccessful. Strongly against the political machines in New York, he was unable to get the support needed to win the election. In 1920 Roosevelt’s political career gained national exposure when he accepted the nomination for vice president alongside James M. Cox. They were soundly defeated by Republican Warren G. Harding, however, the election gave Roosevelt the boost into publicity that his career needed.

Just as Roosevelt felt that his political career was really beginning to boom, tragedy struck as he was diagnosed with polio. At that time, polio had no known cure. Roosevelt decided to remove himself from politics in order to focus on rehabilitation and recovery. After four years out of the public eye, Roosevelt decided to return to politics despite being wheelchair bound and hesitant to the public reaction of his disability. However, the public reaction was one of compassion and his career continued to advance once again. By 1928 he was governor of New York, and after serving two terms, he ran for President in 1932.

The 32nd President

Franklin Roosevelt became the 32^nd President of the United States in 1933 with John Nance Garner as his Vice President. The United States was in the middle of the Great Depression, and FDR used this to his advantage as he campaigned against the Republicans whom he blamed for the failing economy. His platform of hope called for government intervention that would prove relief, recovery, and reform to the economy. Roosevelt won the election with 472 electoral votes to a mere 59 for current Republican President Herbert Hoover. FDR took the office of presidency in March of 1933, to a nation with nearly a quarter of the workforce unemployed, hundreds of bank closures, and the greatest economic crisis the country had ever seen. What Roosevelt accomplished in the first 100 days of Presidency was unprecedented. He immediately set forth in his efforts to turn the economy around with what became famously known as Roosevelt’s New Deal. In contrast to the small government, free-market philosophy of Hoover, FDR sought for radical and immediate changes. In his New Deal, he promised American’s that his respond to the depression would be with bold, consistent experimentation and he followed through with just that. In his first 100 days in office, FDR passed 15 major bills through Congress as a part of his promised New Deal.

The New Deal

October 29th, 1929 will forever be known in American economic history as Black Tuesday, the day the stock market crashed, and the country plummeted into the Great Depression. Soon after, banks failed, the money supply diminished, companies went bankrupt, and unemployment skyrocketed. President Hoover sought for patience from citizens, arguing that the economic crisis would pass and the government need not intervene. However, it became clear that this was no ordinary crisis, and Roosevelt recognized government intervention was of the utmost importance to save the country. As soon as Roosevelt took office, he set forth his plan for a New Deal.

FDR’s first act as president was to declare a four-day banking holiday, in which time Congress drafted the Emergency Banking Bill of 1933. The bill stabilized the banking system by putting the federal government behind it, in an effort to restore public faith in the banking system. Next, FDR signed the Glass-Steagall Act which created the FDIC and provided federally insured deposits. The Civil Conservation Corps was a successful New Deal program that provided work for 3 million young men. The program sent young men to the nation’s forests where they dug ditches, built reservoirs, and planted trees for $30 a month. The Works Progress Administration, another work relief program, employed more than 8.5 million people to build bridges, roads, airports, and public buildings and parks. The National Industrial Recovery Act (NIRA) and the National Recovery Act (NRA) addressed employment issues by regulating the number of hours worked per week and banning child labor. The Federal Emergency Relief Administration (FERA) was yet another implementation of Roosevelt’s New Deal, this one giving $3 billion to states for work relief programs. The Agricultural Adjustment Act provided loans for farmers facing bankruptcy, and The Home Owner’s Loan Corporation (HOLC) saved thousands of homes from foreclosure.

Just as FDR had promised, he provided bold and consistent experimentation. He tried various methods to ease the Depression and although some were not successful, he continued on with new approaches. His effectiveness with Congress was unrivaled and it allowed him to make a sweeping reform. While the New Deal did not end the Great Depression, it helped the American people enormously not only by taking care of basic needs, but by providing hope that sustained them throughout the recovery.

 

 

 

 

 

References

http://americanhistory.about.com/od/franklinroosevelt/p/pfdroosevelt.htm

http://www.biography.com/people/franklin-d-roosevelt-9463381?page=3

http://www.fdrlibrary.marist.edu/aboutfdr/polio.html

http://www.history.com/topics/franklin-d-roosevelt/photos#videos

http://www.pbs.org/wgbh/americanexperience/features/general-article/dustbowl-franklin-d-roosevelt/

http://www.usnews.com/news/history/articles/2009/02/12/the-first-100-days-franklin-roosevelt-pioneered-the-100-day-concept

 

How General Motors changed the automobile industry in the 1920s.

When people think about the making of the auto industry and what has made it survive and even thrive the first thing that comes to mind is Henry Ford and the Model T. It is thought that Ford created the assembly line. This is not true, the credit actually goes to Ransom Eli Olds. Now don’t get me wrong Ford did some great things in the auto industry. Such as, adding automation to the assembly line and lowering the cost of the Model T from a range of $600-$7500 to $265. However with this price drop came a few drawbacks. First, the only color available was black (simply because it dried faster). Second, the Model T was completely square with no curves or anything else to make it visually appealing (strictly a cost saving measure). Oh and did I mention that the only vehicle available from Ford for seventeen years straight was the Model T (he only began making the Model A because of the persistence from his son from the falling sales). What happens when a family with a rising income wishes to replace their car for a newer and better model and yet all that is available from Ford is the same Model T they purchased seventeen years ago? This is where General Motors stepped in and saved and expanded the automobile industry.

After General Motors was behind Ford in sales for what seemed like an eternity Pierre DuPont decided to change things up in 1920 by appointing Alfred Sloan to the job of overcoming Ford’s sales figures. Sloan realized that price was simply not an option. Ford had driven the price of the Model T down so far that Sloan knew the only thing he could do was make a better quality car.

Work began on a copper cooled engine to be released with the 1923 Chevrolet. However, due totechnical problems the engine was delayed and was not ready in time for the release of the 1923 Chevrolet. So, instead of just throwing in the towel and waiting until next year Sloan made the call to release the 1923 Chevrolet with the same technology that it had kept for the past nine years (remember Ford had released the same exact car for seventeen years). However, one thing would be different, the latest style body. We’re talking the same car with the looks of a luxury car, lower roof, higher hood, and rounded lines. Sales boomed and the focus of the automobile industry changed forever. This proved it was not the latest and greatest technology under the hood consumers were looking for. They wanted something shiny and new to show off.

Another area where General Motors exceeded was being able to build cars for different markets. The different brands included Chevrolet, Buick, Pontiac, Oldsmobile, and Cadillac. Sloan lowered the cost of producing all these brands by sharing parts between the brands. A Buick and a Pontiac could have the same transmission but the finished product would look completely different from each other.  All the models under all the brands only varied by three different shells which came in different sizes. They then were made aesthetically different by superficial parts like taillights and fenders. Remember how if you bought a Ford your only color choice was black? General Motors decided this wasn’t good enough and offered a spectrum of colors. Since new is always better according to the consumer General Moors released a new model every year. Before this a new car every year was unheard of. Although the shell and mechanics stayed the same sometimes for multiple years the exterior was changed to have a “new” appearance.

Check out the YouTube video to see the assortment of vehicles offered by General Motors.

http://www.youtube.com/watch?v=wZbM5cqeyDw

Finally in 1927 General Motors surpassed Ford in sales. In fact in the 1920s a few jokes circulated about the Model T. “Why is a Model T like a mistress? Because you hate to be seen on the streets with one.” Another joke about the Model T’s construction was about a driver not needing a speedometer because he already knew his speed.  “When my Ford is running five miles per hour, the fender rattles; twelve miles an hour, my teeth rattle; and fifteen miles an hour, the transmission drops out.” 

Driven by the fact that looks sell more than whats under the hood General Motors brought in Harley Earl in 1927 to make an inexpensive Cadillac, the La Salle, look like a luxury Cadillac. Earl built expensive looking cars for the movies in Hollywood and Sloan knew he would be the perfect guy for the job. The La Salle was an obvious success and at the time “was the most beautiful car ever built”. Earl stated, “I try to design a car so that every time you get in it, it’s a relief–you have a little vacation for awhile”.

General Motors was founded on September 16, 1908 originally only holding Buick. Now 105 years later holding Buick, Chevrolet, Cadillac, and GMC. General Motors led vehicle sales for 77 consecutive years, from 1931 through 2007, longer than any other automaker in history. This story of success is made possible by management standing up and stepping out of the box to save an industry that was only going downhill. They knew what consumers were looking for and changed the automobile industries way of thinking in order to give them what they wanted and even what they only dreamed of.

References:

(Main Reference) http://www.autolife.umd.umich.edu/Design/Gartman/D_Casestudy/D_Casestudy1.htm

http://en.wikipedia.org/wiki/General_Motors

http://en.wikipedia.org/wiki/History_of_General_Motors

http://www.youtube.com/watch?v=wZbM5cqeyDw

         The Train system in the economic

Although we had a glance of the rail road and trains in our books I decided to take a further look into the economic benefits because of my grandfather, who has passed, and his love of trains. So to start in 1828 the rail road was developed and started to expand across the US first from the north then to the south. The rail road was closely modeled after the English rail line meaning all of the lines were inter connected together.

The exception was the south, instead of intertwining their rail lines they disconnected them making it nearly impossible to stay on one line for very long. This decision seriously hurt them in the civil war. Whenever the south needed supplies they would have to go through many different train lines to get any of it making it impossible to get any supplies. So they used canals and water ways to ship their goods from place to place. But even the water road was unusable due to blockades by the north. Soon they started to take apart the rail road to make new guns and to scavenge parts for other supplies they deeply needed. The north took part the rail ways mainly to stop the south from getting the supplies they desperately needed. This was one of the reasons the north won.

After the civil war the nation got to work putting their economy back together. They also started to put damaged rail road lines back together mainly in the north. Newly designed Train cars were developed to help with different types of transportation. One of those special cars was the passenger car; this revolutionized the way that people got from place to place. The rail road could go through any weather and on any day to places that most water ways and canals could not. It was also more comfortable for the passengers then going in a wagon because of the accommodations that were not available. Wagons did not have room to move around, or food car, or even a sleeping car. So passengers never had to stop traveling so someone could stretch their legs or eat, making the trip shorter and easier on the passengers. Not to mention in a wagon you were riding on rocky bumpy roads were as in a train it was nice and even. It was also safer then canals and water ways. It was less likely for a train to get into an accident that a boat to cap size in the river. Even though the rail ways were very popular for many reasons, many were often not financed by government founding or financing, infect most were financed by Privet Company’s or by investors. Mainly because the government didn’t actually think that it was going to work as well as it did.

Of course passengers weren’t the only thing that was affected positively by the rail ways. The transportation of goods such as but not limited to wheat and cotton were also helped by the trains. Thanks to the rail ways more food was able to get from place to place. It cost less money and time to get things to other cities and states making it cheaper. It took fewer products to supply the demand thanks to the reliability of the trains and the speed of them. It also cost less to insure the items in transport, the water ways became less and less in demand. Even with most of the demand in trains there were still those who chose to use the canals and water ways that were closest to them. But for the most part both people and goods relied on trains to get them safely to their destination.

Rail roads like many businesses had invested into Wall Street and at first it helped the business grow bigger and stronger. However after the great depression the rail road slowly died. Because of the lack of funding thanks to the depression it became harder for the rail road to pay back investors and soon their employs.  After cut in pay check a large strike ensued the biggest strike in the history of trains. This seriously hurt the train system and they never quite recovered to their former glory. Soon the automobiles took over for the best way to travel making the train only useful for transporting goods.

President Ronald Reagan and “Reaganomics”

The president of the United States is considered one of the most powerful men in the world. Becoming president is a grueling and long process, and it takes a gifted individual to win a presidential election. There are many reasons why a president is elected by the people to be the leader of the United States, but no matter the reason, the main goal of every president is to improve the government, the economy, and the country as a whole. Some presidents have done little to change, and others have made drastic and controversial changes. One president that is considered to make the most drastic changes in the government and the economy, which are still debated to this day, was President Ronald Reagan.

Elected in 1980, Reagan was the 40th president of the United States, and is well-known for his radio broadcasting, Hollywood film career, charismatic leadership, sense of humor, and his legacy as a president. Even with all of his achievements and successes, Reagan’s presidency is highlighted by his plan to stimulate the economy and create growth, which we know today as Reaganomics.

Reagan’s Early Life and Hollywood Career

 

Reagan was born on February 6th, 1911 in Tampico, IL. He was a gifted athlete and played football in high school and played in college for Eureka University. After graduating from college, he began working on the radio in Iowa, where he was an announcer for football and baseball. While he traveled to Los Angeles on a spring training trip with the Chicago Cubs, he contacted a former colleague who was able to organize a meeting with a Hollywood agent. In 1937, he signed a seven-year deal with Warner Brothers studios. He was also a Captain in the United States Army Air Forces where he served from 1937 to 1945. 

Reagan landed his first movie role in 1937 as a radio reporter in the movie Love is on the Air. Even though he was a natural performer, it was not until a few years later that Reagan starred in the movie that made his career. He was chosen to play George Gipp in the movie Knute Rockne – All American. After starring in that movie, Reagan was all over Hollywood. His sense of humor, handsomeness, and love of showbusiness was adored by all. His acting career includes more than 50 films such as Bedtime for Bonzo, Kings Row (Which Reagan considered his best film and even titled his autobiography “Where’s the Rest of Me?” after the movie’s main quote), the host of the 1950’s television program General Electric Theater, involvement in the Screen Actors Guild, and guest appearances on other shows, such as “What’s My Line?” as seen in the link below. Great example of Ronald Reagan’s sense of humor.

Ronald Reagan Guest Appearance on “What’s my Line” TV Show

 

From Actor to Politician

Reagan’s grand entrance into the world of politics came in 1965 when he gave a speech at a fundraiser for Barry Goldwater, the current Republican presidential candidate at the time. About a year later, Reagan became governor of California. He served as governor until 1974, and then began his run at the presidency. His history in Hollywood was seen as a weakness at the beginning of his political career, but Reagan proved that this was actually one of his greatest assets. He used quotes like “Win one for the Gipper!” from his movie Knute Rockne during his campaigns to tie his acting career to his political career. After a few years of campaigning, he a won the election in 1980 and became the 40th President of the United States. Reagan was the oldest President to take office at the age of 69 years old, and is still the oldest president to serve in office to this day. He won re-election in 1984 and served as president until 1988. He remained in the public eye until 1994 when he announced that he had Alzheimer’s Disease, and passed away at the age of 93 on June 5th, 2004. 

 

Reaganomics

Still considered to be one of the most severe attempts to alter the course of U.S. economic policy of any presidential administration to this day, “Reaganomics” defines the economic policies of Ronald Reagan during his presidency. The goal of Reaganomics was to increase investment and saving, stimulate economic growth, successfully balance the national budget, reduce interest rates and inflation, and restore healthy financial markets. Once Reagan claimed presidency and moved to the White House, he did not waste any time initiating his plan to turn the economy around.

Reagan’s vision to change the economy included many goals and policies that occurred over the course of the Reagan administration. The first and possibly most important step toward fixing the economic problems facing America was Reagan’s 1981 Program for Economic Recovery, which consisted of four major policy objectives:

1) Decrease the growth of government spending – The annual increase in real federal spending decreased from four percent during President Carter’s presidency to two and a half percent during the Reagan Administration. Unfortunately, the increase in defense spending was greater than Reagan originally proposed during the 1980 campaign. Reagan did not achieve a significant decrease in federal spending because economic growth was slower than expected. This struggle was most likely the greatest disappointment of Reagan’s presidency.

2) Reduce the marginal tax rates on income from not only labor but also capital – The changes Reagan made in tax rates is one of the most noticeable changes. Reaganomics achieved sharp reductions in marginal tax rates and in inflation, and were accomplished at a cheaper cost than what was predicted. From 1980 to 1988, the corporate income tax rate dropped from 48 percent to 34 percent, and the top marginal tax rate in individual income decreased 70 percent to 28 percent. 

3) Cut back on government regulation – Decrease in regulation by the government was ranked last in priority compared to the other goals of Reagan’s economic policy, but was successful. Although it was at a slower rate, the decrease in economic regulation that began during the Carter Administration continued. Reagan also eliminated or lessened price controls on cable TV, ocean shipping, interstate bus service, long-distance telephone service, and oil and natural gas.

4) Reduce inflation by controlling the growth of the money supply – Inflation proved to be one of the most difficult issues to overcome. At the time, Stagflation had been an ongoing in the U.S. economy, but escalated in 1973 and continued until 1980. The Reagan economic program corrected this problem and began a period of lower inflation and higher growth. Over the course of Reagan’s presidency, the inflation rate decreased from 10.4 percent in 1980 to 4.2 percent in 1988.

It may not have been to the degree that was intended, but Reaganomics delivered on all of their objectives. It was clear that there was a significant improvement in the economy that was led by the Reagan economic program. Just not as much as Reagan had wanted. There were a few areas of the initial goals of his first program that were unsuccessful due to resistance from Congress and the American voters. As a whole, Reagan achieved his goal of improving the economy for the most part, something that had not been accomplished by a U.S. president in a long time.

There is a great deal that can be learned from Ronald Reagan, his presidency, and Reaganomics. In today’s world, we still experience difficulties in the economy; the rising National Deficit, rises and falls in the economy, the Obama-care situation, and more. Perhaps the most important lesson to learn from Reagan’s past is not in the issues he prevailed against or the problems he faced, but how he reacted and what drove him to attempt the impossible. For someone to charge straight in and attempt to completely change the entire economy is a feat in itself. But to be able to with a smile and endless optimism is something else. As americans, we have slightly lacked in the pro-action department, and are putting our faith in the idea that the economy and the government will fix themselves. This placement of faith needs to be moved, and relocated back into ourselves, and trust that we have the ability to make a difference. After all, if an actor has enough faith in himself to become president and succeeds, what’s stopping us from achieving our own goals?

 

Sources:

Niskanen, William A. “Reaganomics”. The Concise Encyclopedia of Economics. Library of Economics and Liberty. Nov 5 2013.  http://www.econlib.org/library/Enc1/Reaganomics.html

“Ronald Reagan Born”. This Day in History. The History Channel. Nov 10 2013.  http://www.history.com/this-day-in-history/ronald-reagan-born

Suarez, Ray. “Reagan’s Economic Legacy”. PBS News Hour. June 4 2004. Nov 3 2013. http://www.pbs.org/newshour/bb/business/jan-june04/reagan_06-10.html

Pictures

http://desertpeace.files.wordpress.com/2013/04/reagan-bonzo.jpeg

http://www.airfieldsystems.com/wp-content/uploads/2013/07/Former-President-Ronald-Reagan.jpg

http://fc01.deviantart.net/fs71/f/2012/183/0/6/ronald_reagan_riding_a_velociraptor_by_sharpwriter-d55rsh7.jpg

http://1.bp.blogspot.com/-H8er77IBK4Y/TonNh49irHI/AAAAAAAAFlY/DXt99Si64hE/s1600/reagan22new.jpg

http://www.notable-quotes.com/r/ronald_reagan_quote.jpg

The Federal Reserve

In researching the topic I found nothing but controversies surrounding the institution. Both left and right wing proponents take issue with the Fed. Being that it is a very complex and extensive topic I decided to try to focus on how the Fed was created, and how its creation has fueled controversy.

The Fed, what is it?

The Federal Reserve Act was passed on December 23^rd, 1913. The act brought into existence the nation’s central bank, the Federal Reserve. The Fed is often seen as a mysterious institution, with many not even knowing what it actually is, or does. According to the Fed’s website they are responsible for: “conducting the nation’s monetary policy in pursuit of full employment and stable prices, supervising and regulating banks, maintaining the stability of the financial system, and providing certain financial services to the U.S. government.” The Fed consists of twelve regional reserve banks. These banks act as operating arms that provide services to banks and the public in their region. These regional banks are overseen by a 7 member Board of Governors. These board members are also responsible for implementing monetary policy for the United States. The board is appointed by the president and confirmed by the senate. The Fed is a unique institution in that it is both public, and private. It is considered “independent within the government.”

 First Banks

The Federal Reserve was not the first attempt at a national bank. In fact, there were two national banks before our current system. Both of these banks had twenty year charters and both of them expired after twenty years (1791-1801, 1816-1836). Thomas Jefferson and James Madison were strongly opposed to the first bank. They believed the bank was unconstitutional and at the expense of the majority. The second bank shared the same fate as the first, this time it was Andrew Jackson denying the renewal. Jackson was strongly opposed to the Second Bank and ultimately vetoed the bill to renew it as he thought the bank put too much power in the hands of too few.

Gold Standard

In 1834 the United States went on the gold standard with a fixed price of gold per ounce ($20.67). This meant that one US dollar was worth approximately 1/20th of an ounce of gold. The gold standard was thought of as ” hard money,” and a “money of the people.” It was money that could not be tampered with. During the Civil War the government went off the gold standard and printed money (greenbacks) in order to finance the war. These fiat notes were legal tender, however they were not redeemable for any gold. The governments power to print unbacked currency can later be seen as one of the pillars of the Federal Reserve. After the civil war the US went back on the gold standard and experienced one of the greatest periods of prosperity the United States has ever seen. For twenty years the total output of goods and services increased at a rate of four percent per year. The US later lowered  how much gold the dollar was worth to 40% of it’s initial value in order to print more money into circulation. The gold standard was essentially abandoned in 1933. This is important because some do not realize there is absolutely nothing backing our currency, just the promise of the government, and the trust in the US dollar.

Panic of 1907 and further push for a central bank

By the late 1800’s the financial elite (led by JP Morgan and John D Rockefeller) began advocating for a central bank. They wanted cheap credit and an inflated money supply to expand their empires. The effort received a boost with the banking panic of 1907. During this financial crisis there was a run on many of the banks. Since banks use fractional reserve banking and only need to keep a small amount of its customer’s deposits on hand, banks run intro trouble if enough people withdrawal their money. These runs ultimately lead to the failure of the Knickerbocker Trust, and lead other establishments to near bankruptcy. This crisis would have been worse if not for JP Morgan and other New York bankers bailing out the banking system. The fear of bank failure was adopted and used by wall street, and the financial elite to sell the idea of a central bank. A bank that could be used as a lender of last resort.

Jekyll Island

In November of 1910, several financially, and politically prominent men took part in a very secretive trip to Jekyll island, an island off the coast of Georgia. The trip was so secretive the men only used their first names and arrived separately. One member even brought a shotgun with him in order to claim he was going on a duck hunting trip. The men in attendance were:

• Frank Vanderlip – President of National City Bank of New York
• Nelson Aldrich – Senate republican leader and chairman of the National Monetary Commission
•  Henry Davidson – Senior partner J.P. Morgan Co.
• Charles Norton – President of the First National Bank of New York
• Paul Warburg – Partner in Kuhn, Loeb & Co
• A. Piatt Andrew – Assistant Secretary of the Treasury and Special Assistant to the National Monetary Commission
• Benjamin Strong – Vice President of Banker’s Trust of New York

Over the course of 7-10 days the men hammered out much of the details that later became known as the Aldrich Plan. The need for secrecy was evidenced  years later in an autobiography by Frank Vanderlip. In it he stated: “if it were to be exposed publicly that our particular group had gotten together and written a banking bill, that bill would have no chance whatever of passage by Congress.”

Senator Aldrich proposed his plan to Washington a few years later. Unfortunately for him, the plan came at a bad time as democrats had just captured congress. Though most republicans and Wall Street bankers favored the plan, it did not fair well with progressives, or the public, because the plan very much favored large bankers.

The Federal Reserve Act

Woodrow Wilson was voted into office in 1913. During his tenure he pledged financial reform of banking. He liked some aspects of Aldrich’s proposed plan, which would later come to be be the basis of the Federal Reserve bill. A new bill was proposed by advisers of Wilson’s; Carter Glass, and H. Parker Willis. Wilson liked the plan but wanted to add an amendment, a Federal Reserve Board to have control over the bankers. Wilson proposed the revised bill but was met with some opposition from bankers, and from conservatives who thought it was a radical break from the nation’s lazissez-faire economic policy. After many debates, and amendments, the Federal Reserve Act passed congress on Dec 22nd, 1913 and  was signed by Wilson the following day. It represented a compromise of different parties and interests, including Aldrich’s Plan.

Conclusion

The Federal Reserve has had profound implications on our economic system. After all, they literally print our money, and printed right on each bill it says: “Federal Reserve Note.” It’s an entirely different way of doing banking that every nation has adopted, a fiat based currency. The Federal Reserve was designed in part to contain banking crises. Though, as we have learned this year this wasn’t necessarily the case. Only 16 years after the Federal Reserve Act was the start of the Great Depression. We’ve also learned about how the Fed changes the market by raising or lowering interest rates. On a few occasions the Fed would try to keep money tight by raising interest rates in order to keep inflation down. Sometimes this would have dire consequences as the nation would be plunged into recessions because of this money policy.

  Many opponents of the Federal Reserve claim that it is in itself unconstitutional, and too private to be trusted to having the whole in mind. There are many who think we should scrap the Fed altogether and go back to some sort of gold standard. The meeting on Jekyll Island itself causes much controversy and has sparked many conspiracy theories; so much so that nearly every documentary I found on the Fed was a “truth” documentary. I myself found the whole topic interesting and will never think about the Fed the same way.

Works Cited:

Money, Banking, and The Federal Reserve – http://www.youtube.com/watch?v=iYZM58dulPE

www.federalreserve.gov

http://en.wikipedia.org/wiki/History_of_the_Federal_Reserve_System

http://en.wikipedia.org/wiki/Federal_Reserve_Board_of_Governors

http://www.bostonfed.org/about/pubs/begin.pdf

http://www.minneapolisfed.org/publications_papers/pub_display.cfm?id=3815

Images:

http://static-imgs-acf.hereisthecity.com/20110721/17/federal_reserve_logo_2147.gif

http://thoughtsontheatre.files.wordpress.com/2012/06/national-bank-cartoon.jpg

http://i.investopedia.com/inv/articles/site/CT-GoldStandard.gif

http://media.smithsonianmag.com/images/1907panic_4.jpg

http://www.mindcontagion.org/images/jekyll_island.jpg

http://upload.wikimedia.org/wikipedia/commons/thumb/7/7a/Fed_Reserve.JPG/220px-Fed_Reserve.JPG

The stock market crash in 1929, which we called The Great Depression, caused the worst economic crisis of the United States. Many people believe if the government had more control over banks, it might have been prevented or not as harsh. Monetary Policy in the Great Depression: What the Fed Did, and Why – Depression_Mar_Apr1992.pdf

During the Great Depression, many families lost their homes because they could not pay their mortgages. These people had no choice but to seek alternative forms of shelter. As the Depression worsened in the 1930’s, it caused very severe hardships for millions of Americans. Shanty towns appeared across the U.S. as unemployed people were evicted from their homes. When the government failed to provide relief, President Herbert Hoover was blamed for the economic and social conditions, and the shanty towns that cropped up across the nation, mostly on the outskirts of major cities, became known as The Hoovervilles. President Herbert Hoover was defeated in the 1932 presidential election by Franklin Roosevelt, who’s New Deal recovery programs eventually helped the U.S. out of the Depression.

Here are a couple videos. I hope you enjoy!

Works Cited

http://youtube/0bzUYMbjWEk

http://youtube/POMhTqw1d4

http://research.stlouisfed.org/publications/review/92/03/Depression_Mar_Apr1992.pdf

 

The Stock Market Crash of 1929

In 1929, the United States economy was falling into ruins, it would soon become known as the Great Depression. The start of the fall of our economy began in late October, but on October 29, 1929 the stock market officially crashed. This date would later become known as “Black Tuesday”. In that week the stock market lost more than $30 billion dollars, and $14 billion alone on that Tuesday. The devastating crash of the stock market was the signal of the longest, and deepest depression our nation has ever faced. Some economist believe that the stock market crash was the cause of the Great Depression, others believe it was just a large factor. Either way it was detrimental to individuals and businesses alike. I am going to explore a couple of the factors that caused the market to crash. From my research the main causes of the Stock Market Crash were the credit boom, buying on margin, irrational expectations, incongruity between production and consumption, and weaknesses in the banking system.

Credit Boom

In the early 1920’s the economy was flourishing, and there was an exponential growth in credit and loans. Many people felt that investing in the Stock Market was safe, firms and individuals alike continued to borrow money to invest and expand. People were indebted, so they were sensitive to change. When the market took a down turn everyone tried to sell their shares at once. The chart below shows the US debt, and how the credit boom added to our debts.

 

Buying On Margin

This concept is similar to buying on credit. You only had to pay a small amount of the shares, which meant you were borrowing 80-90% of the share. The idea of this allowed people to invest more therefore increasing the value of shares. So when the market began to crash not only were the people who owned the shares wiped out, but also the firms and banks that loaned them the money.

Irrational Expectations

Some described the Stock Market as the new Gold Rush. Many believe this was the largest contributor to the crash of ’29. People were eager to make millions and investing was one way people could make money. In the years leading up to the crash people bought shares only expecting to make money. The higher the shares went the more people borrowed to make money. The market soon became stuck in a speculation bubble. A problem soon arose from this, stock prices were not the same as the real earnings of the stocks. The prices were not driven by the structure of the economy, but by exuberance. Stock prices were inflated by 400% between 1923-1929 (www.economicshelp.org).

Incongruity between Production and Consumption

In the early 1920’s the economies of scale greatly increased due to technological advancements. The problem with this is the consumption for these goods was not as high as the production. This resulted in smaller profits, causing the share prices to drop. Many industries, such as the automobile, steel, and housing markets, indicated the down turn of the economy. But, despite these warning signs people continued buying.

 

The chart above shows the booming GDP, our economy could not keep up with the increase forever.

Weaknesses in the Banking System

Previous to the Great Depression the American banking system had no standards or regulations and was comprised on many small to medium sized banks. According to www.economicshelp.org, there was over 30,000 banks before the economic downfall. Many banks failed, because of the agricultural depression, and when stocks lost value banks lost the money they loaned. In less than 5 years more than 5,000 banks had closed.

Conclusion

So in conclusion, these five factors led to the fall of the Stock Market in October of 1929, the largest being our irrational expectations. The combination of the crash and our slowly failing economy drove our nation into a decade of dark economic times. Many historians and economists believe the Stock Market crash was the biggest cause of the Great Depression. We learned many things from the stock market crash, and history repeated itself in 2008 when our economy became similar to the economy before the Great Depression. Studying what happened in 1929 helped us with our present day issues.

Works Cited

http://www.economicshelp.org/blog/76/economics/wall-street-crash-1929/

Hiebert, Ray. The Stock Market Crash, 1929. New York: Franklin Watts, 1970. Print.

http://www.google.com/search?q=gdp+of+1920s&client=safari&rls=en&tbm=isch&tbo=u&source=univ&sa=X&ei=H1ebUrrTHMvzoASQ6YGgCw&ved=0CDUQsAQ&biw=1232&bih=684#q=black+tuesday+newspaper&rls=en&tbm=isch&facrc=_&imgdii=_&imgrc=EWZcv_z9w59zuM%3A%3BwLais8sTQzTrIM%3Bhttp%253A%252F%252Fthefinanser.co.uk%252F.a%252F6a01053620481c970b0120a6879e9e970c-800wi%3Bhttp%253A%252F%252Fthefinanser.co.uk%252Ffsclub%252F2009%252F10%252F%3B530%3B387

mises.org

The Story

Warren Buffet

The  story of Warren Buffet, and how he changed the world of today. My goal of this paper is to provide a insight to the life of Warren Buffet. I will also explain the very simple strategy that he used to gain his wealth. I have read his Biography “Snow Ball Effect”, which tells everything about Warren from a early age to the present. Warren is a testament to the investment world, that it’s not as complicated as the world portrays it to be. I will shed light on Warren’s childhood and a timeline about how he got to where he go today. Warren buffet is a individual that made his own path. When he found something that he liked or wanted he went and got it. He is not a person that fell into luck, he was a go getter and made sure he surround himself with individuals of that nature.

The Story

The start of the Warren error, Warren was born on August 30, 1930( http://www.biography.com/people/warren-buffett-9230729). He was son of Howard Buffet, Nebraska businessman, investor, and four-term Republican United States Representative. As you can see Warren’s business values were instilled in him at a early age. Warren took a early liking to money. “At 11 years old he made his first investment; he bought three shares of Cities Service Preferred at $38 per share. The stock quickly dropped to only $27, but Buffett held on tenaciously until they reached $40. He sold his shares at a small profit, but regretted the decision when Cities Service shot up to nearly $200 a share. He later cited this experience as an early lesson in patience in investing. By the age of 13 he was running his own business, he was delivering papers and selling his own tip sheet at the horse track. He also filed his own tax return claiming a $35.00 deduction which was for the use of his bike (http://en.wikipedia.org/wiki/Warren_Buffett). He also went door to door selling Coca Cola and bubble gum. The skills he developed at a early age allowed him to become the business man he is today.

Warren Buffet had many other business as a young individual, another small business that he started was with another neighborhood boy. They sold golf ball business. They originally got their capital from stealing balls from his local Sears. His dad became suspicious of the growing number of golf balls Warren had started accumulating in his closet. His father finally made him settle up or he would lose his paper route. Once this happened he needed to find another way to keep his golf ball business alive. So he started sneaking on to the local golf course at night looking for balls. He persuaded another neighborhood boy that he could join the business if he would swim to the bottoms of the pond to get the balls.

At the age of 13 his father was elected to the house of representatives, so the family moved to Washington D.C. After arriving in D.C. Warren didn’t take much time to dive into another business. He bought a pinball machine, with in a month he had made a profit that allowed him to buy two more Machines. He than sold the business to a old Veteran for $1200.00. With the profit from the pinball business warren took on a large endeavor as sophomore he purchased a 40 acre farm back in Nebraska. He hired a farm to work the land and it has been worked ever since.

After High School Warren enrolled at the University of Pennsylvania at the age of 16. Many of his classmate said that Warren seemed to be a socially awkward individual, he seemed to be out of places and not fit in. Warren’s roommate at University of Pennsylvania said he never saw Warren study. After two years Warren dropped out of college and returned home.
After returning home he enrolled in the University of Nebraska and obtained his bachelors degree. From looking at Warren buffet and where he is today you would never figure he was a person that feared public speaking. He ended up enrolling in in public speaking course to get over his fears. Well attending University of Nebraska he also purchased a Texaco gas station (which turned to be a failing business).

Warren Buffet was a very ambitious individual, in all fascists of life. At the age of 20 buffet found out that Ben Graham a professor at the University of Columbia was on the board of GEICO Insurance Company. Warren Got on a train on a Saturday and headed to Washington DC where GEICO’s head quarters were located. He knock on the door until a janitor answered, unfortunately Graham was not there but he was introduced to the Vice President of GEICO Lorimer Davidson. Warren Buffet is a testament to the world that you need to make your own opportunities and not wait for them to come to you. He will proves this time an time and again that he created his own opportunities.

Warren was excepted to Columbia differently than your average student. Warren had missed the dead line to apply and so he wrote a letter to Ben Graham asking to be accepted, and that he admired his work. After completing college Warren Buffet had managed to save $9,800 from the business that he had well he was a child (adjusted for inflation $94,000 today). For a young individual to amass that kind of wealth at such a early age is a pretty incredible accomplishment.

The Next Step

Warren’s Business Career

Once he graduated he wanted to go work on Wall Street, but both his father and  Ben Graham urged him not to. Warren than offered to work for Graham for free, but Graham would not allow it. Warren returned to Omaha where he was employed by Buffet-Falk & Company from 1951-1954. Where he was and investment sales men. In 1954-1956 he took a job working for Graham’s firm Graham-Newman Corp (his pay was 12,000 a year, a adjusted today that would be $104,000), where he was a securities analyst. In 1956 Ben Graham decide to retire, and Warren made the leap of faith and started his own business named Buffet Partnership. At this point Buffet had managed to save a $174,000 ($1,470,000 million) The Buffet Partnership started to become a power house by 1960 Buffet owned and operated seven different partnerships. In 1962 Warren Buffet became a Millionare and decide to combined all of his partnerships into one. In 1970 he acquired Berkshire Hathaway, were he is the CEO and Chairmen to this day.

The Making of a Future Billionare

Prior to 1962 Warren had began to purchase shares of Berkshire Hathaway (for $11.76 Share). Berkshire has not always been a investment firm they started as a textile company. In 1965 the CEO of Berkshire offered Warren a buy back of his stock at $11.50 per share which Warren agreed to. A few weeks later Warren received a buy back offer from Berkshire for $11.38 per share. Warren declined the purchase and was furious and began to acquire more shares. After acquiring enough shares to become majority share own Warren fired the CEO and took over ownership of Berkshire Hathaway. Berkshire remained in the textile business shortly. In 1967 Berkshire began it’s first venture into the insurance industry by purchasing National Indemnity Company. In late 1970 Berkshire purchased it’s first equity stake in GEICO ( which is it main insurance business to this day). In 1985 the last textile planet of Berkshire was shut down. Despite Berkshire Hathaway being what it is today Warren Buffet claims that it was one of the worst investments he ever made. Warren Stated that if he were to have take that money and invested it in the insurance business, with compounding growth he would have made additional $200,000,000,000 Billion. But we say would of could of should of.

The Expansion and Growth of a “Power House”

Thought the last 40 years Berkshire Hathaway has grow to be a power house in the invest world. Warren buffet almost immediately started purchasing companies and acquiring major positions in companies. In this section I’m going to provide a timeline on the expansion of Berkshire and there major purchase.

1964: Buffett invests one-quarter of the partnership in American Express, whose stock value had been hurt by a salad oil scandal but whose traveler’s checks, charge cards and brand image carry strong value.

1967: Buffett buys National Indemnity Co. of Omaha, his entry into the insurance business.

1969: Buffett liquidates the partnership, saying, “I am not attuned to this market environment, and I don’t want to spoil a decent record by trying to play a game I don’t understand just so I can go out a hero.”

Buffett has $25 million at age 39. The partnership gained 7 percent in its final year for a compound annual growth rate since 1957 of 25.5 percent, compared with the Dow’s 7.4 percent. Some partners retain their Berkshire holdings, then at $43 a share.

1971: The Washington Post sells shares to the public, and Buffett begins acquiring. By 1974 Chairwoman Katherine Graham invites him to join the newspaper’s board of directors. He remains a director today.

1972: Buffett acquires See’s Candy Shops for $25 million and ever since has cited it as the perfect company, with high customer loyalty and a brand-name advantage.

Early ’70s: Buffett and Charlie Munger control Blue Chip Stamps, a trading stamp company. Buffett invests cash that the company accumulates.

1974: Buffett buys Wesco Financial, a savings and loan and investment company. Munger begins to handle its investments.

1976: Buffett invests in GEICO, the auto insurer, which is slumping. Berkshire eventually owns the whole company.

1977: Through Blue Chip, Buffett buys the Buffalo (N.Y.) Evening News newspaper for $32.5 million.

1979: Buffett invests in ABC-TV.

1980: Buffett turns 50, and Berkshire stock is $375 a share.

1983: Buffett buys 80 percent of the Nebraska Furniture Mart for $55 million.

1985: Capital Cities buys ABC-TV, and Buffett becomes Cap Cities’ biggest shareholder.

1989: Buffett buys 80 percent of Borsheim’s Fine Jewelry for an undisclosed amount. Purchases of other jewelry and furniture retailers in the U.S. follow.

1991: Buffett meets Microsoft founder Bill Gates, who becomes a Berkshire board member and influences Buffett to put his wealth to work on humanitarian issues.

1996: Buffett creates Class B shares, worth one-thirtieth of a Class A share, making it easier for stockholders to give shares as gifts without facing tax consequences and stopping investment groups from collecting fees for selling small pieces of Berkshire stock through investment trusts.

1998: Buffett buys General Reinsurance for $22 billion, Berkshire’s biggest purchase to date.

2000: Buffett heads a $9 billion purchase of MidAmerican Energy Holdings, based in Des Moines and with ties to executives from Omaha’s Peter Kiewit Sons’ Inc.

2001: Insurance claims from the 9/11 terrorist attacks total $2.28 billion. Buffett apologizes to his shareholders for failing to foresee the risk and properly price insurance coverage.

2002: Berkshire and other investment groups buy $500 million in bonds issued by Level 3 Communications, the former Omaha fiber network company.

2003: Buffett buys Clayton Homes Inc. of Maryville, Tenn., a modular-home manufacturer and finance firm, for $1.7 billion after University of Tennessee students give a book to Buffett on the company’s history.

2004: Securities officials investigate misconduct by some General Re executives and American International Group, resulting in indictments of some executives. After an interview with investigators in New York City, Buffett says, “I told them everything I know.” Regulators say he helped with the case.

2006: Berkshire buys 80 percent of Iscar Manufacturing, an Israeli tool manufacturer and his first big international company purchase.

2008: Buffett visits Germany, Switzerland, Spain and Italy, partly to introduce himself to European business owners who might want to sell to Berkshire.

Buffett writes an opinion piece titled “Buy American. I am,” which is credited with helping calm the 2008 financial crisis. Berkshire stock gains while the rest of the market drops, but by March 2009, the market is at its low point, and Berkshire’s share price is down 50 percent.

2009: A $5 billion “paper” loss on investments and derivatives triggers a first-quarter loss by Berkshire, its biggest since the 9/11 terrorist attacks. But earnings rebound later in the year.

Buffett joins the American Philosophical Society, founded in 1743 by Benjamin Franklin to promote the sciences and humanities.

2010: Berkshire purchases the remaining shares of Burlington Northern Santa Fe Corp. for $26 billion, the company’s biggest purchase ever. As part of the purchase, Berkshire splits its Class B stock 50 for 1, the first split in company history.

I want to reiterate Warren Buffent was a very hard working individual and investor. By no means did his success come easy. Berkshire is the highest valued company on the market with a market value of 173,810.00 (http://finance.yahoo.com/q/hp?s=BRK-A).

Some interesting facts to the power of investing in Berkshire Hathaway (http://www.usnews.com/usnews/biztech/personalfinance/personal_investing_buffett/timeline/amazing_record.htm)

Information provided By http://www.omaha.com/article/20100501/MONEY/705019979

Here is a link to the exact equity holding of Berkshire Hathaway (http://en.wikipedia.org/wiki/List_of_assets_owned_by_Berkshire_Hathaway)

Preparing for the Inevitable

Everyone knows that an end must come, and Warren is no exception he understands that he will not be able to manage Berkshire forever. He has began to select individuals to manage the company. He is currently working on a team that will consist of a CEO, and three to four investment managers that will manage the company. has selected one investment managers Ted Combs and the CEO which will be hired internally. He is still looking for the rest of the investment management team “It could be YOU”.

Sources

Some interesting facts to the power of investing in Berkshire Hathaway (http://www.usnews.com/usnews/biztech/personalfinance/personal_investing_buffett/timeline/amazing_record.htm)

Information provided By http://www.omaha.com/article/20100501/MONEY/705019979

Here is a link to the exact equity holding of Berkshire Hathaway (http://en.wikipedia.org/wiki/List_of_assets_owned_by_Berkshire_Hathaway)

Black Friday

Part 1: Major Players

Jason “Jay” Gould: Born on May 27, 1876  Jay Gould would go on to become the ninth richest American of all time. A prolific businessman, he began his career by obtaining half-interest in a blacksmith’s shop for which he was a book keeper. Never static for long he dabbled in map making, wrote two books, and created a tanning business in a Pennsylvania town that later would be named Gouldsboro. However, he is best known as a railroad tycoon. He was introduced to that business by his father-in-law who asked him to help save his investment in the Rutland and Washington Railroad. Gould had a large reputation as an unscrupulous businessman, and is frequently associated with the term Robber Baron.

James Fisk: Born April 1, 1835 James Fisk, after being in school for only a short time ran away to join the circus. Frequently referred to as flamboyant, “Big Jim” Fisk was, and wanted to be, a “larger than life” character. A 1937 movie, “The Toast of New York” is a highly fictionalized story of his life. Bob Dylan wrote a song that is supposedly inspired by Fisk. Employed by Daniel Drew, Fisk worked as a stockbroker in New York. His work with Drew would lead Fisk to play part in the Erie War. After the war, and some shady business dealings, both Fisk and Gould gained control of the Erie Railroad, which made them both extremely wealthy men.

Ulysses S. Grant: Born April 27, 1822 Ulysses S Grant was 18th president of the United States. Grant’s presidency was peppered with many scandals. This was largely due to the way business was conducted in mid-19th century America. Taking place in the gilded age of American history,  Grant’s presidency was very good for big business. The lack of regulations allowed corporations an almost free hand. Insider trading was still a legal business practice. The era also saw great wealth inequality.There was very little government over-sight, and where it existed, it was often corrupt. Grant kept high tariffs on imported industrial goods which also helped American businesses, and made many American businessmen very rich.

Abel Corbin: Born May 24, 1808 Abel Corbin was a newspaper editor, and husband of Virginia Grant, who was the sister of Ulysses S. Grant. This relationship would lead him to play a background role in the Black Friday stock market crash of 1869.

 Part 2: What Happened

After the civil war, the United States had a lot of reconstruction to do, and the reconstruction was going to cost a lot of money. Due to this, the government would incur a large amount of public debt. The government paid in “greenbacks,” the legal tender of the time. During this period the United States was on a gold bullion standard. This meant the the government agreed to redeem gold at a fixed price for currency. Because of the reconstruction costs, the government was printing more and more of this money. It became increasingly true that whoever could corner the market in gold would have an immense amount of power. By holding large amounts and not selling, they could drive up the price by creating a scarcity in the market. This would greatly increase the value of their gold as redeemable in currency.

At some point, this occurred to Gould and Fisk, and they decided to attempt acquisition just that kind of power. Gould alone bought seven million dollars worth of gold. This purchase by itself sent the price of $100 in gold from $131 in greenbacks, to $140 (Miller p.147). There was a problem however. The United States Treasury held 80 million dollars in gold that could be sold into the market, causing them to lose money. Obviously this was not acceptable to Gould. So, he teamed up with Fisk and they came up with a plan to both protect their investment and make a lot of money from it.

First, they would need the help of someone close to the president. That man would be Abel Corbin, the presidents brother-in-law. Corbin was able to influence the President’s decision regarding whom to elect as Assistant U.S. Treasurer. Both Corbin and the new treasurer acquired around 2 million dollars in gold bonds which were purchased by Gould, which, assured their interest in the metal’s value as well as their allegiance to Gould. Having an insider high up in the U.S. Treasurers office  allowed Gould and Fisk to be tipped off if the government should decide to sell. Their relationship with Corbin would also allow them to get close to President Grant in social situations. In this way, they would be able to influence the president not to sell gold in order to keep the prices up.

By the end of the summer of 1869 Gould and Fisk had managed to corner the market. Never selling the gold they purchased, and simply holding on to it, had caused prices to continue to rise. When Grant realized what was happening to the price, he instructed the Treasury to release gold from their reserves to help regulate it. However, Gould and Fisk were, of course, tipped off by their man inside the Treasury ahead of time. When the gold came into the market, the price rose substantially for a short time, then began rapidly to fall. Most investors scrambled to sell their holdings which caused the situation to get worse and worse. Many small investors went bankrupt, and exports leaving the United States would be effected for years. The influx of gold from the government would however stabilize the price of gold, and Gould and Fisk would no longer have a corner the market. The crash happened on September 24, 1869, the date that would come to be known as Black Friday. Gould made $11 million dollars. Most though lost considerable sums of money, including (in an example of kharma) Abel Corbin.

Thankfully, since 1869 the United States has come a long way in regulating its markets so as to protect from these kinds of things happening. Insider trading has becoming illegal, and organizations like the U.S. Securities and Exchange Commission would make what Gould did impossible today. And, we are much better off because of it. It has evened the playing field for investors to speculate in the market, rather than having a playing field for a select few with “inside information” or influence.

Part 3: Additional Information

It was harder than I expected to find video’s that related to “Black Friday.” I did however find this lecture/video by Dr. Michael Brooks that is worth sharing, and helped provide me with information.

Here is an old radio production of the story of Jay Gould. Dated, but still entertaining.

Works Cited

Sexton, Robert L. Roger Leroy Miller. “Issues is American Economic History.” Mason, Ohio:Thomson South-Western. 2005. Print.

 

Introduction

For many years, the Reo Motor Truck Company stood on Elm Street between Washington Avenue and Cedar Street.  As the years have went by, it is almost hard for me to remember what that area used to look like.  My father was a painter at Reo and I would ride with my mother every Friday to take my Dad to work and again in the evening to pick him up.  My dad as well as my uncle worked there until the plant closed its doors in 1967.  I always thought Reo produced only trucks and I found out a lot about Reo and its history as I did my research.  I found out that in the beginning, the company produced mostly automobiles, but also had a truck line..  Take a ride through history with me and learn about the Reo Motor Truck Company and its influence on Lansing.

 Building REO

The Reo Motor Truck Company was founded in 1910 by Ransom Eli Olds named after him using his initials.  The company bought what was once the Baker farm and the new factory at 1126 S. Washington Avenue in Lansing Michigan was built.  Many of the workers came from farms and some as far away as Germany. To provide Reo with a reliable supply of parts, Olds put together subsidiary firms such as the National Coil Company and Atlas Drop Forge Company.  By 1907, Reo had gross sales of $4 million, and Olds headed one of the top four automobile manufacturers in the nation.  Reo Motor Truck Company began the production of trucks and Reo’s legendary Speed Wagon led the way with shaft drive, pneumatic tires, electric starters and lights which were found on all competitive makes.  By July 1925, REO Speed Wagon sales exceeded $125,000 and the company soon became a leader in automobile production.  

1933 Speedwagon

Ransom Eli Olds

R.E. Olds was born June 3, 1864 in Geneva, Ohio to Pliny and Sarah Olds.  There isn’t much about his childhood except that his family moved a lot as his father continued to search for decent work.  When Olds turned 16, the Olds family permanently settled in Lansing Michigan where his father opened a machine shop.  After Olds finished the 10th grade, he took a six month course at Bartlett’s Business College in 1882-83 before becoming a machinist-bookkeeper for P.F. Olds and Son.

Ransom Eli Olds was the inventor of the Oldsmobile and Olds Motor Works; however, Olds was not happy there and left the company.  With a lot of time on his hands, he helped create the “REO Motor Truck Company which was named after him.   This name was soon changed to Reo. The name change was in order to ensure that a threatened lawsuit from the Olds Motor Works would not happen.  Olds held control of Reo with 52 percent of the stock as well as the titles of president and general manager.

Reo Struggles

It was said that R.E. Olds was talented in the mechanical part of the business rather than administrative and focused on mechanical and technological improvements which played a part in Reo’s struggles and Reo struggled throughout the years and even after Olds left the company then the company started getting ahead during WWII because of all the truck orders it received; however, that was short lived and the company was once again unstable up until the time it was sold to Bohn Aluminum and Brass Corporation of Detroit. There was a trucking line which started in 1910; however, Diamond Reo Trucks were not produced until three years after Bohn bought the company and it merged with White Motor Company in 1957.

 Gold Comet Assembly Line in Lansing, Michigan circa 1959 – Factory Photo

The Reo Clubhouse

The clubhouse on South Washington Avenue

Another interesting piece of Reo’s history is the clubhouse which was built in 1927.  The clubhouse hosted many events and during its time was a cultural hub of Lansing.  Many events were held at the club house which included balls, weddings, basketball games, free movies as well as patriotic events during WWI and WWII.  The clubhouse also featured Lansing’s first radio station WREO in 1921.  The clubhouse, also named “The Temple of Leisure” consisted of  four bowling allies, a 2000 seat dining room, auditorium, a fireproof movie booth, a smoking lounge and billiard room.  This facility was used by Reo workers which Olds used to help retain the loyalty of its employees.

Reo’s Demise

White merged Reo with Diamond T Trucks in 1967.  Eventually, in 1975, the firm filed for bankruptcy and most of its assets were liquidated.  Even though the Reo plant was designated as a National Historic Landmark, the Reo plant and Clubhouse was demolished in 1979 to make room for new industry.  Where Reo stood and the surrounding area is now known as Reo Town.

Conclusion

REO was in Lansing for many years and contributed to the culture and employment opportunities for the citizens of Lansing and surrounding area. There are many pictures and information on a facebook page “REO, Diamond T and Diamond Reo Enthusiasts”.  I have also included a video of the R.E. Olds museum where you can visit and learn so much more about R.E. Olds and his work as well as the Reo factory.  To learn more about R.E. Olds inventions and Diamond Reo you can visit the R.E. Olds museum located in Lansing Michigan.  I have included a you tube video of the museum.  https://www.youtube.com/watch?v=KUKfApxYwks

Reo Water Tower looking north from Cedar Street overpass

References

http://www.nps.gov/nhl/DOE_dedesignations/Reo.htm

http://www.lansing.org/about/history/automotive-history/

http://en.wikipedia.org/wiki/REO_Motor_Car_Company

 

 

 

Introduction 

We often look upon our history with a great sense of reverence. We are the modern tale of “David and Goliath”, the rebirth of Freedom, the land of prosperity, and the vigilant protector of Liberty. Upon crossing a once insurmountable ocean we escaped the shackles of inequality, and our forefathers were baptized anew in endless streams and lakes of an unknown frontier—at least this is how much of our early history is imagined.

In this sense, the subtle nuances of our history are too often overshadowed by the grandeur that encompasses them. Nothing displays this more than our celebration of the 4th of July, and the fireworks that light the sky. The fireworks of our history often distract us from looking downward, inward, and taking notice of anything but the blinding display of American success.

In an attempt to grasp just how unique we are, Larry Schweikart and Dave Dougherty, authors of A Patriot’s History of the Modern World, contend that we are set apart and we are “Exceptional” in the truest sense. Specifically, they point to four factors that have and still distinguish us. The combination of these four factors (Schweikart 4):

1. A heritage of common law
2. A Christian and predominantly Protestant religious tradition
3. A free-market economy
4. Property rights, especially land rights

It is with this history that we must attempt to match each day, trying to hold on to what we view as American Exceptionalism. Once again, we are confronted with trying to meet an unreachable standard, looking to the past for guidance in transcending class boundaries and reliving a time of relative inequality. We, like every generation, get stuck in a time period where the rich get richer and the poor get poorer. We want so much for what we once had that we overlook our own nostalgia in observing our history.

Today, congressional gridlock and increasing tensions often lead us to remember the Great Compromises that our country has made to move forward, and keep us together. In this manner, the great political compromises that our politicians have made overshadow the concessions that the Ruling-Class has offered to stabilize their ever-present position in our society. Here, we will examine how the Ruling-Class has steered us forward.

In steering us forward, their role could imply a negative or positive role, but oftentimes the line is obscured beyond recognition. Ultimately though, their role in holding America together cannot be understated or ignored. 

What is Class?

Today, we often hear of the growing dissatisfaction amongst the Middle-Class.  The Middle-Class being a term used in the United States, and often implies the industrial base. Together with The Rich and The Poor we usually generalize ourselves along these lines. Of course, many have created sub-groups and offshoots but as we already can see, labeling itself does little to help us understand the class dynamic, which is far more complex than the rich get richer and the poor get poorer.

 What is Class? (Historically)

Be it through natural or unnatural forces, classes or hierarchies of some form have existed throughout our history. In reading Aristotle on Masters and Slaves written in 300 BP:

“The element which is able, by virtue of its intelligence, to exercise forethought, is naturally a ruling and master element; the element which is able by virtue of its bodily power, to do the physical work, is a ruled element, which is naturally in a state of slavery; and master and slave have accordingly a common interest” (Johnson 11).

Here, we see that class is often justified on the grounds of one person being superior to another person in one way or another. This can be viewed as a biological justification based on gender or color. These grounds of reason have been used by more recent historical figures, to include Thomas Jefferson.

“Comparing them by their faculties of memory, reason, and imagination, it appears to me that in memory they are equal to the whites; in reason much inferior, as I think one could scarcely be found capable of tracing and comprehending the investigations of Euclid; and that in imagination they are dull, tasteless, and anomalous” (Johnson 148).

Even in one of the world’s oldest religions, Hinduism, class still seeped through the framework of society. In examining the castes system in India, Huston Smith attempts to determine some historical reason for its prevalence and the role that castes played in society.

“Unless unequals are separated in some fashion, the weak must compete against the strong across the board and will stand no chance of winning anywhere. Between castes there was no equality, but within each caste the individual’s rights were safer than if he or she had been forced to fend alone in the world at large” (Smith 57).

There is no doubt that priests, shamans, emperors and kings used religion to justify their position of power, deriving their authority from a higher power. Protestant Reformation and the emergence of Calvinism diminished this stability greatly, but even upon arriving in the Chesapeake, colonists still remained shackled to class in some sense.  When we look at class-formation from a Christian religious standpoint, an important note should be mentioned when examining the minds of these early colonists. Specifically, the Angelic Hierarchy arrived between the 4th and 5th century, which showed that class-formation, transcended even the heavens (Christian).

Class in the scope of this Project

For the context of this endeavor, several views should be noted that give us a better sense of understanding class. Importantly, these views will also play an important role when examining the historical events that I will analyze.

While Kees Van Der Pijl’s thesis In The Making of an Atlantic Ruling Class involves the time period between the 20th century Progressive movement and through the Cold War era, he offers a compelling understanding of the forces that surround class, which should easily be applicable to multiple time periods.  In The Making of an Atlantic Ruling Class:

 Definition

“The concept of class refers to the fundamental social tensions that drive change and lend it its direction” (xiii).

Formation

“…Social forces form into classes along lines drawn by the operation of capital as a unified discipline, what Marx calls Gesamtkapital, ‘social’, or ‘comprehensive’ capital” (xiv).

Maintenance

“Competition, then, unifies ‘the’ bourgeoisie and yet simultaneously rules out that it can ever constitute itself as a unified social force in an unmediated way. Rather we see a continuous regrouping from changing vantage points determined by political business cycles” (xv).

Control

“The capitalist class usually has the upper hand in social development on account of its ability to develop the productive forces and broadening what Braudel calls the ‘limits of the possible’ for society as a whole” (xv).  

 Furthermore, Class Consciousness is another important term that is helpful in examining the proceeding historical events. In Marxism, class-consciousness is used to:

“Refer to the beliefs that a person holds regarding one’s social class or economic rank in society, the structure of their class, and their class interests” (Wiki).

Bacon’s Rebellion: The First Test in the Americas

 

The growth of the colonies, and Virginia in particular, is often characterized by an over-abundance of land with a lack of labor to till it. As seen in the events leading to Bacon’s Rebellion, this assumption is certainly not the case.

What: Nathanial Bacon led Virginia settlers in a rebellion against Governor William Berkeley.

Where: Jamestown, Virginia

When: 1676

Class-Formation – Unclear

Initially, class-formation in itself was unapparent in the earliest years of Virginia. More specifically, a key ingredient, “Capital”, did not exist. Instead, several unifying themes held everyone together.

• An individualist theme as summed up by John Smith: “He who shall not work shall not eat” (Pageant 27). This need for survival became an important unifying call that broke many of the old ideas that colonists knew.
• A cultural theme of “us against them”, which is early on displayed as a unifying theme of survival. The colonists required unity against the Indians in order to maintain their way of life.

Furthermore, the high rates of death, the lack of offspring, and early mortality figures impeded a process whereby class-formation could become apparent.

Class-Formation – Highly Permeable

Continuing on, class-lines became apparent, quite early. Tobacco became the dominant form of capital, colonists began to live longer, and the birth of offspring became more prominent.

The lines that separated class in this period remained highly permeable. While there was clear lines separating indentured servants from existing land owners, once indentured servitude ended, those freeman now had the opportunity to transcend class lines and become part of the land-owning class. One of the mechanisms that contributed to this permeability was the Head-Right System, whereby newly freed indentured servants were able to effectively get a leg-up in their lives and transcend their former positions.

Class-Formation – Rigid

In the wake of the 3rd Anglo-Powhatan War, the peace treaty of October 1646 established the boundaries that both the Indians and English settlers agreed to maintain. It should be said that this was a treaty that the Indians and the House of Burgesses agreed upon. In the wake of this treaty, the colony began to expand at greater speeds. This expansion had several effects that made the act of transcending class more difficult.

First, as the desirable land near the center of the colony became taken, newly freed individuals were required to establish their farms further outside the desirable area of the colony. Furthermore, as lifespans became longer, and mortality became lower, wealth began to accumulate among a select few, and the wealthy was able to pass on that wealth to their offspring. Additionally, a key ingredient, the Head-right, had become less honored. Lastly, the cultural theme of “us against them” became increasingly blurred as the wealthy became viewed as against the people. Colonists perceived that the House of Burgesses had placed Indian appeasement above their own.

Breaking Point

The breaking point culminated in Bacon’s Rebellion, which took place in 1676. Class consciousness reflected the increasing polarization between the wealthy land owners, who also held seats on the House of Burgesses, and those settlers in specific that attempted to settle lands further outside the scope of the Virginia colony. It should be noted that leading up to Bacon’s Rebellion, Africans in Virginia in 1670 numbered only 5.7 percent of the population (Pageant 65).

The most impressive result of Bacon’s Rebellion could be the fact that Bacon and his followers successfully overthrew Berkley, but looking closer at the situation, indeed the most impressive result was the overwhelming cooperation of the classes against the burgesses.

How the Ruling – Class adapted to Stay in Power

Following Bacons’ death, the House of Burgesses successfully squelched the revolt. Nevertheless, this did not mean that polarization between Bacon’s supporters and the ruling-class had shifted. Certainly, “…the large planters were growing increasingly fearful of the multitudes of potentially mutinous former servants in their midst” (Pageant 65). Additionally, the increasing signs of class-unity provided the incentives necessary, on the part of the burgesses, to somehow break up this unity. As described in Meyer Weinberg’s A Short History of American Capitalism:

“The answer to the problem, obvious if unspoken and only gradually recognized, was racism, to separate dangerous free whites from dangerous slave blacks by a screen of racial contempt” (Weinberg 43).

After Bacon’s Rebellion, Virginia continued to see a rise in capital accumulation on the part of an elite few. The ruling-class effectively shifted class polarization away from capital divides, and transferred the attention towards racial divides. Furthermore, the ruling-class discovered that in order to remain in power, they needed to continue the expansion of capital outside the confines of the colony. As such, the treaties that the government made with Indians took a back seat to the whims of the lower classes.

This form of control taken by the ruling-elites continued onward past the Revolutionary War. Above all else, “the rise of liberty and equality in the country was accompanied by the rise of slavery” (Countryman 121).

Sources (by appearance)

Schweikart, Larry, and Dave Dougherty. A Patriot’s History of the Modern World. New York: Penguin Group, 2012. Print.

Johnson P. Michael. Reading the American Past: Fifth Edition. New York: Bedford/St. Martin’s, 2010. Print.

Smith, Huston. The World’s Religions. New York: HarperSanFrancisco, 1991. Print.

“Christian angelic hierarchy.” Wikipedia, The Free Encyclopedia. Wikimedia Foundation, Inc. 22 July 2004. Web. 01 Dec. 2013. <http://en.wikipedia.org/wiki/Christian_angelic_hierarchy>

Kees Van Der Pijl. The Making of an Atlantic Ruling Class. New York: Verso, 2012. Print.

“Class consciousness.” Wikipedia, The Free Encyclopedia. Wikimedia Foundation, Inc. 22 July 2004. Web. 01 Dec. 2013. < http://en.wikipedia.org/wiki/Class_consciousness>

Bailey, Thomas, and David Kennedy. The American Pageant: Tenth Edition. D.C. Heath and Company: United States: 1994. Print.

Weinberg, Meyer. A Short History of American Capitalism. New History Press: United States, 2003. Print.

Countryman, Edward. How Did American Slavery Begin? New York: Bedford / St. Martin’s, 1999. Print.

Image One: <http://upload.wikimedia.org/wikipedia/commons/f/ff/Francesco_Botticini_-_The_Assumption_of_the_Virgin.jpg>

Image Two: <http://www.sonofthesouth.net/revolutionary-war/colonies/jamestown.htm>

Image Three:<https://secure.www.upenn.edu/themeyear/water/images/stories/middle_passage.jpg>