The 100 Most Important American Financial Crises This page intentionally left blank The 100 Most Important American Financial Crises An Encyclopedia of the Lowest Points in American Economic History Quentin R Skrabec Jr Copyright © 2015 by abc-clio, llc All rights reserved No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, except for the inclusion of brief quotations in a review, without prior permission in writing from the publisher Library of Congress Cataloging-in-Publication Data Skrabec, Quentin R â•… The 100 most important American financial crises : an encyclopedia of the lowest points in American economic history / Quentin R Skrabec Jr â•…â•…pages cm â•…Includes bibliographical references and index â•…ISBN 978-1-4408-3011-2 (hardback : alk paper) — ISBN 978-1-4408-3012-9 (ebook)â•… Financial crises—United States—History.â•… United States—Economic conditions.â•… Banks and banking—United States—History â•…I Title.â•…II Title: The hundred most important American financial crises â•… HB3722.S58 2015 â•…338.5ʹ42—dc23â•…â•…â•…2014022053 ISBN: 978-1-4408-3011-2 EISBN: 978-1-4408-3012-9 19╇18╇17╇16╇15â•…â•… 1╇2╇3╇4╇5 This book is also available on the World Wide Web as an eBook Visit www.abc-clio.com for details Greenwood An Imprint of ABC-CLIO, LLC ABC-CLIO, LLC 130 Cremona Drive, P.O Box 1911 Santa Barbara, California 93116-1911 This book is printed on acid-free paper Manufactured in the United States of America To the Patroness of American Crisis, Our Lady of Prompt Succor This page intentionally left blank Contents Preface xiii Acknowledgments xv Introduction xvii 1676—Bacon’s Rebellion 1703—Tobacco Depression 1719—Mississippi Bubble 1733—Molasses Act 1749—Colonial Hyperinflation and Currency Deflation 12 1750—Iron Act 15 1762—Colonial Recession 17 1764–1765—Sugar Act, Currency Act, and Stamp Act Boycotts 19 1772—Credit Crisis 22 1776—War Financing Crisis 24 1781—Currency Deflation and Inflation 28 1790—Debt Assumption, Debt Retirement, and Expanding the Economy 31 1792—Panic 33 37 1794—Whiskey Tax Rebellion 1796–1797—Panic 40 1800—Trade Interference by Barbary Coast Pirates 43 1807—Economic Embargo and Depression 45 1812—War of 1812 48 vii viii | Contents 1816–1819—Economic Warfare and Dumping by Great Britain 51 1819—Panic 53 1820s—Cotton Recession 56 1825—British Panic and Its American Impact 58 1828—Tariff of Abominations 60 1833—Andrew Jackson Closes the Bank of the United States and Lowers Tariffs 63 1837—Panic and Six-Year Depression 66 1847—Panic 69 1848—Gold Rush Boom and Bust 71 1850—Whale Oil Shortage: The First Energy Crisis 73 1854—Panic 76 1854—Decline of American Canals 78 1857—Panic 81 1861—Civil War Economics, Shortages, and Inflation 83 1862—Union Blockade and Inflation 85 1869—Grant’s Recession 88 1873—Panic and Global Depression 90 1877—Great National Railroad Strike 93 1880s—New England Energy Crisis 96 1882—Bessemer Process and the Labor Crisis 98 1882—Recession 101 1884—Panic 103 1890—British Panic 105 1893—Panic 107 1894—National Labor Unrest 110 1896—Gold Crisis 113 1899—Ohio Gas Industry Collapse 115 1901—Rich Man’s Panic 117 Contents 1902—National Anthracite Coal Strike | ix 119 1907—Panic 122 1910—Rubber Shortage and Price Explosion 125 1914–1918—War Shortages 127 1914—Crisis 129 1917—Boll Weevil Cotton Crisis 132 1918—Flu Pandemic 134 1919—National Steel Strike 136 1921—Automotive Recession 139 1921—British Rubber Embargo and Monopoly Control 142 1922—Peanut Import Crisis 144 1929—Wall Street Crash and Great Depression 146 1930s—Agricultural Depression and the Dust Bowl 150 1936–1939—Labor Uprisings 153 1937–1938—Recession 155 1940s—World War II Rationing and Shortages 158 1941—Rubber Crisis and Shortage 161 1943—Steel, Metal, and Alloy Shortage Crisis 164 1947—Economic Restructuring of America: Taft-Hartley Act 166 1947—Mont Pelerin: A Crisis in Economic Thought and Academia 169 1959—National Steel Strike 171 1965—Auto Import Challenge and the Fall of the American Auto Industry 173 1969—Technological Tire Crisis: Radial Tire Production Ends U.S Rubber Dominance 175 1971—Wage and Price Controls 178 1973—Arab Oil Embargo Crisis 181 1974—Double-Digit Inflation 184 1975—Rapid Deindustrialization 186 Bibliography | 325 Skrabec, Quentin William McKinley: Apostle of Protectionism New York: Algora Publishing, 2008 Skrabec, Quentin The World’s Wealthiest Neighborhood New York: Algora Publishing, 2010 Smelser, Marshall The Democratic Republic New York: Harper & Row, 1968 Sobel, Robert Panic on Wall Street: A History of America’s Financial Disasters New York: Macmillan Company, 1968 Sobel, Robert The Panic of ’57, Machines and Morality: The 1850s New York: Crowell, 1973 Spivak, Burton Jefferson’s English Crisis: Commerce, Embargo, and the Republican Revolution Charlottesville: University Press of Virginia, 1979 Springer, G L., and Jorge Molina 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Press, 1993, 57–65 Thiers, Adolphe The Mississippi Bubble: A Memoir of John Law Whitefish, New York Kessinger Publishing, 2007 Tully, John The Devil’s Milk: A Social History of Rubber New York: Monthly Review Press, 2011 Tyler, John Smugglers and Patriots: Boston Merchants and the Advent of the American Revolution Boston: Northeastern University Press, 1986 Victor, David Natural Gas and Geopolitics: From 1970 to 2040 Cambridge: Cambridge University Press, 2008 Walker, Samuel Three Mile Island: A Nuclear Crisis in Historical Perspective Berkeley: University of California Press, 2004 Wall, Joseph Frazier Andrew Carnegie Pittsburgh: University of Pittsburgh Press, 1970 326 | Bibliography Walters, Raymond Albert Gallatin: Jeffersonian Financier and Diplomat New York: Macmillan, 1959 Wapshott, Nicholas Keynes Hayek: The Clash That Defined Modern Economics New York: W W Norton & Company, 2011 Warren, Kenneth Big Steel: The First Century of United States Corporation Pittsburgh: University of Pittsburgh Press, 2003 Washburn, Wilcomb E The Governor and the Rebel: A History of Bacon’s Rebellion in Virginia New York: W W Norton & Company, 1972 Waugh, Joan U S Grant: American Hero, American Myth Chapel Hill: University of North Carolina Press, 2009 Welch, David, and Dan Beucke “Why GM’s Plan Won’t Work.” Businessweek May 9, 2005 Wicker, Elmus “A Reconsideration of Federal Reserve Policy during 1920–1921 Depression.” Journal of Economic History 26 (1966): 223–238 Wicker, Elmus “Colonial Monetary Standards Contrasted: Evidence from the Seven Years’ War.” Journal of Economic History 45, no (December 1985): 128–132 Wilentz, Sean The Rise of American Democracy: Jefferson to Lincoln New York: W W Norton & Company, 2005 Wiseman, Paul “When the Textile Mills Goes, So Does the Way of Life.” USA Today.com, March 9, 2010 Wiston-Glynn, A W John Law of Lauriston: Financier and Statesman, Founder of the Bank of France, Originator of the Mississippi New York: Newton Page, 2010 Whitney, Meredith Fate of the States: The New Geography of American Prosperity New York: Penguin Portfolio, 2013 Worster, Donald Dust Bowl: The Southern Plains in the 1930s New York: Oxford University Press, 2004 Wymard, Ellie Talking Steel Towns: The Men and Women of America’s Steel Valley Pittsburgh: Carnegie-Mellon Press, 2007 Yapa, Stepson Cotton: The Biography of a Revolutionary Fiber New York: Penguin Books, 2005 Yates, Brock The Decline & Fall of the American Automobile Industry New York: Vintage Books, 1984 Youssef, Michael “The Impact of the Asian Financial Crisis on the World Economy.” International Economic Review, January 1998, 20–29 Index Page numbers followed by (illust.) indicate an illustration; page numbers followed by (photo) indicate a photo Adams, Henry, 108 Adams, John, 29, 32, 35 Adams, John Quincy, 61, 62 Adams, Sam, 20 AFL-CIO (American Federation of Labor and Congress of Industrial Organizations), 200–201 Agricultural Adjustment Act (1938), 156 agricultural depression (1930s), 150–153 AIG, 237, 239, 240 air traffic controllers strike (1981), xvii, 199–201, 200 (photo) ALCOA Aluminum Company, 165 Aldrich-Vreeland Act (1908), 130 “Allentown” (Billy Joel), 201 Amalgamated Association of Iron and Steel Workers, 100 Amazon, 229–230 American auto industry, 173–175 American Federation of Labor, 111, 137, 138, 155 See also AFL-CIO American Railway Union, 111 American Revenue Act (Sugar Act), 20 American Stock Exchange, 130 anthracite coal strike (1902), 119–121 Arab oil embargo (1973), 177, 180, 181–184, 182 (photo), 195 Articles of Confederation, 27 “Asian Contagion,” 221 Asian financial crisis (1997), 221–223 Astor, John, 30 Atomic Energy Act (1954), 192 Atomic Energy Commission, 192 Atoms for Peace initiative (1953), 192 austerity programs, 247 auto imports, 173–175 Autolite, 216 Automobile Manufacturing Industries Act (1936, Japan), 174 automotive industry: Arab oil embargo, 183–184; bias-ply vs steel belted radials, 175–178; black migration to jobs in, 145– 146; deindustrialization and, 173–175, 187; recession in 1921, 139–141; unionization of, 153, 166; Unsafe at Any Speed (Nader), 175 See also companies by name Ayr Bank of Scotland, 23 B F Goodrich Rubber Company: aniline substitute research, 128; automotive recession, 141; Buna-S formula, 162; deindustrialization and, 187; foreign ownership of, 205; nylon-belted radial tires, 176; rubber reclamation process, 143; unionization of, 154 Bacon, Nathaniel, 2–3 Bacon’s Rebellion (1676), 1–4, (illust.), 257–259 Baltimore & Ohio Railroad, 80, 93, 134 Bank of America, 239 Bank of England, 69 Bank of London, 59 327 328 | Index Bank of North America (Pennsylvania Bank), 29 Bank of Pennsylvania, 40, 41, 65, 82 Bank of the United States: Hamilton’s argument for, 32–33; Jackson closes, 64–65; panic of 1792, 34; panic of 1796-1797, 42; panic of 1819, 54–55; panic of 1837, 66–68 “banker’s panic,” 122–124 banking and subprime mortgage crisis (2008), 237–239 bankruptcies: Chrysler, 194–196, 242–244; Detroit, 254–256; General Motors, 242–244; Lehman Brothers, 237–239; San Bernardino, California, 249–251 Bankruptcy Act (1800), 42 banks: Great Depression (1929), 146–150; Great Recession (2009), 239–242; social contagion and runs on, 76, 78 See also Federal Reserve; banks by name; panics by name Banque Royale, Barbary Coast pirates (1800), 43–45 Baring Brothers, 105 Barings Bank of London, 105, 106 Barnes, James B., 53 Barney, Charles, 123 barter system, 9, 23, 29, 57, 84, 224 Baruch, Bernard, 163 Baruch Committee, 163 Bear Stearns, 238–239 Berkeley, Sir William, 1–3, Berkshire Hathaway, 232 Bessemer, Henry, 99 Bessemer process, 99 (illust.), 99–100 Bethlehem Steel, 137, 138, 201–202 Biddle, Nicholas, 65 Big Three automakers, 174, 177, 184, 194 See also automotive industry bimetal monetary system, 113 Biscayne National Park, 212 Black Belt region, 132 Black Diamond Steel, 100 Black Monday (October 19, 1987), 209–211 Black Tuesday (October 29, 1929), 147, 148 (photo) Black Thursday (September 18, 1873), 92 Black Thursday (October 24, 1929), 147 Black Friday (September 24, 1869), 88 Black Friday (September 19, 1873), 91 Blinder, Alan, 170 boll weevil cotton crisis (1917), 132–134 Boston Merchants’ Appeals to Repeal the Sugar Act (1764), 260–262 Boston Tea Party, 24 boycotts: of British goods, 20–21, 25; by OPEC, 183; of Pullman, 112; as result of Sugar Act, Currency Act, and Stamp Act, 19–22; secondary, 166 BP (British Petroleum), 245, 246 BP oil spill (2010), 244–247 Bridgestone, 176, 177, 178 Britain, economic warfare and dumping by (1816-1819), 51–53 British Corn Laws, 78, 81 British Panic (1825), 58–60 British Panic (1890), 105–107 British rubber embargo and monopoly control (1921), 142–144 British Rubber Growers Association, 142 British West Indies, 9–10 Bubble Act (1720, Britain), 8, 14 Buchanan, James, 83 Buna-S formula, 162 Burbank, Luther, 142 Bush, George H W., 207, 214 Bush, George W., 236 Butterfield, Daniel, 89 Buttonwood Agreement, 35 Calhoun, John C., 62, 282–290 California Gold Rush, 71–73 California Public Employees Retirement System (CalPERS), 249, 251 Cameron International, 246 canals, 76, 78–81 Carey, Henry C., 85 Carnegie, Andrew, 75, 90, 98, 109 Carter, Jimmy, 189, 190, 192, 192 (photo) Carver, George Washington, 128, 133, 144, 145 Charles II (King of England), Chernobyl nuclear plant meltdown, 193–194 Index Chicago, Burlington, and Quincy Railroad, 118, 119 child labor, 97, 116, 120 The China Syndrome (movie), 193 cholera epidemics, 70, 71 Chrysler bankruptcy (1979), 194–196 Chrysler bankruptcy (2009), 237, 243 Chrysler Loan Guarantee Act (1979), 195 Churchill, Winston, 142 Citigroup, 240 Civil War: economic background for, 51, 57, 60; economics, shortages, and inflation during, 83–85; political background for, 62–63 Civilian Conservation Corps, 149, 152 Clark, E F., 121 Clay, Henry, 49, 51 Clean Air Act, 184 Clean Water Act, 246 Cleveland, Grover, 106, 107, 112, 113 Cleveland’s Address on the Repeal of Sherman Silver Act (1893), 290–294 Clinton, Bill, 201, 214, 215 (photo), 218, 224 clipper ships, 72 coal, 96, 119–121 Coinage Act (1873), 113 colonial recession (1762), 17–19 Committee for Industrial Organization (CIO), 154 Committee of Safety, 25 Compromise Tariff (1833), 62 Compton, Karl, 163 Conant, James, 163 Congress of Industrial Organizations (CIO), 157, 168 (photo) See also AFL-CIO Consumer Reports magazine, 177 Continental (tire company), 176 Cooke, Jay, 91 Coolidge, Calvin, 146 Corbin, Abel, 89 Corey, William, 138 Corn Laws, 78, 81 Cornwall Furnace, 15–16 Corporate Average Fuel Economy (CAFE) regulations, 195 cost-push inflation, 186 cotton: 1820s recession, 56–58; 1917 boll weevil crisis, 132–133; 1920 recession, 140 Coxey, Jacob Sechler, 108–109 craft unions, 99–100 Cranston, Alan, 207 Credit Mobilier, 91 Crescent Iron Works, 100 Culpeper’s Rebellion (1677), Currency Act (1751), 11, 14 Currency Act (1764), 20 currency deflation (1749), 12–14 currency deflation and inflation (1781), 28–31 Datsun, 174 Debs, Eugene, 111 Declaration in the Name of the People (Bacon, 1676), 3, 257–259 DeConcini, Dennis, 207 Deepwater Horizon oil spill (2010), 244–247, 245 (photo) deficit spending, 18, 156, 187, 188 deindustrialization: of Detroit and auto industry, 184, 254; effects on auto industry, 242; free-trade policies and, 169–170; in manufacturing, 186–189; of New England glass industry, 96–98; reduced resiliency of American economy and, 241; of Rust Belt, 196–198; of San Bernardino, California, 249–250; of small towns, 219, 220; tax base erosion as result of, 249 Democratic Party, 61, 145–146, 149 Department of Energy, 183, 189 Depository Institutions Deregulation and Monetary Control Act of 1980, 207 deregulation, 190, 207 derivatives, 238 Detroit bankruptcy (2013), 254–256 Diamond Rubber, 143 Dollar Diplomacy, 125 dot.com bubble (2000), 229–231 double-digit inflation (1974), 184–186 Draft Riot of 1863, 84 Drake, Edwin, 75 Drought Relief Service, 151 Duane, William, 65 Duer, William, 34–35 | 329 330 | Index Dunlop, 143 Dust Bowl (1930s), 150–153, 152 (photo) East India Company, 22, 23, 24 eBay, 230 economic embargo and depression (1807), 45–48 Economic Recovery and Reinvestment Act (2009), 240 Economic Recovery Tax Act (1981), 207 Economic Stimulus Act (2008), 239 economic warfare and dumping by Great Britain (1816-1819), 51–53 Edgar Thomson Works, 99 Edison, Thomas, 142, 143 Eisenhower, Dwight D., 167, 171 Embargo Act (1807), 269–272 embargoes, 45–48, 127–128, 142–144, 181–184 Emergency Energy Act, 189 Emergency Natural Gas Act, 190 Emigrant Industrial Savings Bank (EISB), 77 energy crises: anthracite coal strike, 119–121; Arab oil embargo, 181–184, 182 (photo); natural gas shortage, 189–191; New England glass industry, 96–98; Three Mile Island, 191–194; whale oil shortage, 73–76 English Navigation Act (1651), 1, Eno, John, 104 Equitable Life Assurance Society, 122 Erie and Pittsburgh Railroad, 82 Erie Canal system, 78–80 Erie Railroad, 104 European sovereign debt crisis (2012), 247–248 European Union (EU), 246 Everglades National Park, 212 Fannie Mae, 208, 237, 238 farmers’ crisis (1890), 106 Federal Deposit Insurance Corporation (FDIC), 206 Federal Emergency Management Agency (FEMA), 227 Federal Insurance Contribution Act (FICA), 150 Federal Reserve: in 1920s, 147; before creation of, 92; creation of, 131; end of gold standard and, 180; Great Recession, 240; interest rates and, 156, 238; international involvement of, 225; monetary policies of, 179, 185; 9/11 attacks and, 231, 233; subprime mortgage crisis, 237; Y2K crisis (2000), 227 Federal Reserve Act (1913), 124 Federal Savings and Loan Insurance Corporation (FSLIC), 206 Federal Surplus Relief Corporation (FSRC), 151 Federalist Papers No 44, 33 Federalist Party, 32, 38 Financial Institutions Reform, Recovery, and Enforcement Act (1989), 207–208 Findlay, Ohio, 115–117 Firestone: automotive recession, 140, 141; deindustrialization and, 187; foreign ownership of, 178, 205; rubber plantations, 143, 162; unionization of, 154 Firestone, Harvey, 142 First Continental Congress, 25 Fish, James, 104 fishing industry, 212–213, 244, 246 Fisk, James, 89 flu pandemic (1918), 134–136, 135 (photo) food shock, 185 Ford, Henry, 76, 128, 133, 142, 160, 161 Ford Motor Company, 176 Fordney-McCumber Tariff Bill, 145 Fordyce Bank, 23 Fort Wayne & Chicago Railroad, 82 Fostoria, Ohio, 216 France, 247 Franklin, Benjamin, 20, 26, 29 Freddie Mac, 208, 237, 238 free-trade economic theory, 169–170 free-trade policies: deindustrialization and, 186–189, 194, 196–198, 203–206; NAFTA, 214–217; political support for, 223; vs protectionism, 60–61 French and Indian War (1754–1763), 12 French West Indies, 9, 10 Friedman, Milton, 170, 180 Fukushima reactor accident, 194 fur trade, 1–2, 3, furniture manufacturing, 220–221 Index Gallatin, Albert, 38 Gary, Elbert, 138 GATT Treaty (General Agreement on Tariffs and Trade), 169, 304–311 General Electric, 124 General Motors, 157, 174–175, 176, 237 General Motors bankruptcy (2009), 242–244 General Tire, 178, 205 German immigrants, 69–70 Germany, 246, 247 glass industry, 47, 52–53, 96–98, 115–117, 204, 216 Glass-Owen Act (Federal Reserve Act) (1913), 124 Glenn, John, 207 global economies, interconnectivity of, xvii, 58, 209, 224, 247–248 globalization: free-trade economic policies and, 169–170; reduced resiliency of American economy as result of, 241; tax base erosion as result of, 249 gold crisis (1896), 113–114 gold market crash (1869), 88–90 Gold Rush (1848), 71–73 gold standard, 113–114, 157, 178–180, 185 gold “sterilization” program, 157 Gompers, Samuel, 108, 137, 214 Goodrich See B F Goodrich Rubber Company Goodyear Tire: automotive recession, 140, 141; cotton production, 129; deindustrialization and, 187; foreign ownership of, 205; radial tires, 177; rubber plantations, 143; rubber shortage, 126; unionization of, 154 Gould, Jay, 89 Graham, Thomas, 202 Grant, Ulysses, Jr., 104 Grant, Ulysses S., 88 (photo), 88–89 Grant and Ward, 104 Grant’s Recession (1869), 88–90 Great Depression (1929), 92, 146–150 “Great Inflation” (1972-1980), 184 Great National Railroad Strike (1877), 93–96 Great Northern Railroad, 118 Great Recession (2009), 237–239 Great Society programs, 179 Greece, 246, 247 | 331 Gulf Coast Claim Facility, 245 Gulf oil spill (2010), 244–247 H C Frick Company, 110 Halliburton, 246 Hamilton, Alexander, 29, 31, 32–33, 34–36, 37, 44 Hamilton’s Report on Manufactures (1790), 262–269 Harding, Warren, 139, 142 Harriman, E H., 118 Harrison, Benjamin, 106 Hat Act (1732), 11 Hayek, Friedrich von, 169, 170 Hayward, Tony, 246 Heinz, H J., 92 Heinze, F A., 122 Henry, Patrick, 20 High Point, North Carolina, 220–221 Hill, James Jerome, 118 Home State Savings Bank of Cincinnati, 207 Hoover, Herbert, 128, 142, 143, 148 Hurricane Andrew (1992), 211–213, 213 (photo) Hurricane Katrina (2005), 234–237, 235 (photo) Hurricane Sandy (2012), 251–254, 252 (photo) Hyde, James Hazen, 122 hyperinflation, 12–14 Iacocca, Lee, 195 Illinois Central Railroad, 82 immigration, 69–70, 217, 218 impressments of sailors, 48, 49 (illust.) index arbitrage, 210 Indian Removal Act, 64 Industrial Revolution, 69 inflation: in 1970s, 179–181; during Civil War, 83–85; cost-push, 186; currency, 12–14, 28–31; double-digit, 184–186; as result of Revolutionary War, 18; Union blockade and, 85–88 influenza pandemic (1918), 134–136, 135 (photo) Intercontinental Rubber Company, 143 International Association of Machinists, 137 International Atomic Energy Agency, 192 332 | Index international financial crisis (2008), 237–239 International Monetary Fund (IMF), 169, 218, 222, 223, 224 Internet bubble (2000), 229–231 Irish immigrants, 69–70, 77 Iron Act (1750), 15–17, 259–260 Iron Age magazine, 137 iron production, 15–17, 46, 81 Italy, 246 Jackson, Andrew, 55, 61, 62, 63–66, 64 (illust.) Japanese auto imports, 173–175 Jarves, Deming, 52–53 Jay Cooke & Company, 91 Jefferson, Thomas, 30, 32, 35, 37, 44, 46 Jeffersonian Republican Party, 38 Johnson, Lyndon, 179 Joint Underwriters Association, 213 Jones & Laughlin Steel, NLRB v., 155 Kaiser Steel, 249–250 kerosene, 75–76 Keynes, John Maynard, 149, 169 Keynesian economists, 157, 180 Kier, Samuel, 75 King George’s War (1744–1748), 12 King William’s War (1689–1697), 12 “Knickerbocker crisis” (1907), 122–124 Knickerbocker Savings Bank, 77 Knickerbocker Trust Company, 123 Knights of Labor, 100, 110 Know-Nothing political party, 70 labor: global competition, 186, 194, 219; international wage inequality, 221, 222; migration of workers, 132–133, 234; shortages of, 134–136; skilled vs unskilled, 97, 99, 101; wage concessions by, 205; worker uprisings (1936-1939), 153–155 See also strikes labor crises of 1882, 98–101 Lackawanna & Western Railroad, 82 Lancaster, Pennsylvania, 21 Land Bank, 13 Landrum-Griffin Act (1959), 167 Law, John, 6, (illust.), 7–8 Legal Tender Act (1862), 88 Lehman Brothers bankruptcy, 237, 239 Lewis, John, 154 Libbey Glass, 96–97, 116–117 Lincoln, Abraham, 85 Lincoln Savings and Loan, 207 Louisiana, 212–213 Louisiana Purchase, 54 Lowell, Francis Cabot, 47 LTV Steel, 202–203, 204 MacFarlane, James, 38 Madison, James, 29, 30, 35, 47, 49 Marathon Oil, 115 Marshall, James, 71 McCain, John, 207 McCulloch v Maryland transcript, 272–282 McDonald, David, 172 McKinley, William, 107, 110, 114 McKinley Act (Tariff Act) (1890), 105 Mellon, Thomas, 90 Merrill Lynch, 239 Mexicali, Mexico, 216 Mexican Peso Crisis (1994), 217–218 Mexican-American War (1846–1848), 71 Miami Dade County, 211–212 Michelin, 143, 175, 176, 177, 178 Michigan Central Railroad, 82 Microsoft, 229, 230 Midvale Steel, 137, 138 Millennium Bug, 226 Mississippi Bubble (1719), 6–8 Mississippi Company, 7–8 Mitchell, John, 120 Mohawk (tire company), 187 Molasses Act (1733), 9–11, 18, 20 monetarist school of economics, 8, 157 monetary action, precedent for preemptive, 217 Monongahela (Mon) Valley, Pennsylvania, 37, 39, 202–203 Mont Pelerin Society (1947), xviii, 169–170, 225 Morgan, J P., 104, 105, 113, 114, 118, 123–124 Morgan Stanley, 240 Morris, Robert, 25–26, 27–28, 40, 41, 42 Mount Airy, North Carolina, 220 Index N H Wolfe & Company, 82 Nader, Ralph, 175 NAFTA (1992-1994), 170, 214–217, 215 (photo), 217, 316 NASDAQ Technology Index, 229 National Air Traffic Controllers Association, 201 National Labor Relations Act (Wagner Act) (1935), 149, 153, 157, 166 See also TaftHartley Act (1947) National Labor Relations Board (NLRB), 153, 167, 201 national labor unrest (1894), 110–112 National Recovery Administration (NRA), 149 National Republican Party, 61 national steel strike (1919), 136–139 national steel strike (1959), 171–173 National Traffic and Motor Vehicle Safety Act (1966), 175 National War Labor Board (NWLB), 136–137 Native Americans, 2, (illust.) natural gas, 96, 97, 115–117, 189–191 Natural Gas Policy Act (1978), 190 natural gas shortage (1977), 189–191 Natural Resource Conservation Service, 151 Naval Act (1794), 44 Navigation Acts, 4, 11, 18 Neville, John, 37, 38 New Deal Congress (1933), 152 New Deal Democrats, 149 New Deal policies, 151–152 New England energy crisis (1880s), 96–98 New England Glass (Libbey Glass), 96–97 New Orleans, 234 New York Central Railroad, 118 New York City Bank, 123 (photo) New York Curb, 130 New York Federal Reserve, 147 New York Stock Exchange, 35, 130, 210 See also stock market crashes Newberry Mills, 205 Nicholson, John, 41, 42 9/11 terrorist attacks (2001), 231–234, 233 (photo) Nixon, Richard, 172, 178, 179, 183 Nixon’s Address to the Nation (1971), 311–316 NLRB v Jones & Laughlin Steel, 155 Nonimportation Act (1806), 46 Nonimportation Agreement, 21 Non-Intercourse Act (1809), 47 North American Free Trade Agreement (19921994), 170, 214–217, 215 (photo), 316 North American Land Company, 41 Northern Pacific Railroad, 91, 117, 118, 119 Northern Securities Company, 119 Norton Air Force Base, 250 nullification crisis, 62 Obama, Barack, 240, 244, 246, 252 Office of Thrift Supervision, 208 Ohio Canal system, 79, 81 Ohio Company, 17 Ohio gas industry collapse (1899), 115–117 Ohio Life & Trust, 82 oil industry, 213, 245–246 oil refining industry, 236 Oliver Iron and Steel, 107 OPEC (Organization of Petroleum Exporting Countries), 181, 182 Osterlen, Charles, 115 overregulation, 189–191 panic, defined, 54 Panic of 1792, 33–37 Panic of 1796-1797, 40–42 Panic of 1819, 53–56 Panic of 1837, 66 (illust.), 66–69 Panic of 1847, 69–71 Panic of 1854, 76–78 Panic of 1857, 81–83 Panic of 1873, 90–93 Panic of 1884, 103–105 Panic of 1893, 107–110, 108 (illust.) Panic of 1901, 117–119 Panic of 1907, 122–124, 123 (photo) paper money, 25–28, 26 (illust.) PATCO (Professional Air Traffic Controllers Organization), 199–201 Patriot Act, 233 peanut farming, 133, 144–146 See also Carver, George Washington peanut import crisis (1922), 144–146 | 333 334 | Index Penn, William, 41 Pennsylvania Canal, 79, 80 Pennsylvania Railroad, 80, 93, 134 Pennsylvania Steel, 107 Perot, Ross, 214 Petition to Parliament on Repeal of the Iron Prohibition Act of 1750, 259–260 Phillips curve, 180 pig iron, 15, 16–17, 82, 85 Pirelli, 176 Pittsburgh Foundry, 47 Pittsburgh Puddler Strike (1878), 100 plantation system, 6, 36, 56, 57–58 Polk, James, 71 Portugal, 246 “Potomac fever,” 41 President Cleveland’s Address on the Repeal of Sherman Silver Act (1893), 290–294 price fixing, 180 Professional Air Traffic Controllers Organization (PATCO), 199–201 program trading, 210 protectionism, 60–61, 85 Public Health Service, 136 Pullman Company, 107, 111–112 Queen Anne’s War, radial tire production (1969), 175–178 Rae, John B., 111 Railroad Act (1864), 91 railroads: anthracite coal strike and, 120–121; vs canal transportation, 76, 79, 80; Chinese labor and, 72; expansion of, 81–82, 102; golden era of, 118; Great National Railroad Strike in 1877, 93–95; nationalization of, 128; panic of 1873 and, 90–92; Pullman strike in 1894, 107, 111–112; steel strike in 1959, 172; strike in 1877, 94–95; unionization of, 93–95 See also railroads by name rationing, 158–161, 159 (photo) Reagan, Ronald, 199, 200 red lead, 51, 52–53 Red Scare, 138 Redemption Act (1879), 101 regulation, lack of, 238 Repeal of Sherman Silver Act, President Cleveland’s Address on (1893), 290–294 Repeal of the Iron Prohibition Act of 1750, Petition to Parliament, 259–260 Report on Manufactures (Hamilton, 1790), 262–269 Republic Steel, 155, 204 Republican Party, 145–146 Resolution Trust Corporation, 207–208 Revere, Paul, 20 Revolutionary War, 18, 20, 22, 29, 31–33 Revolutionary War financing crisis (1776), 24–28 “rich man’s panic” (1901), 106, 117–119 Riegle, Don, 207 right-to-work laws, 166, 167–168, 198 Riot Act, 30 Roosevelt, Franklin D., 149, 150, 151 Roosevelt, Theodore, 121, 122 rubber: 1921 British embargo of, 142–144; shortages of, 125–127, 161–163; synthetic alternatives to, 162–163 Rubber Club, 143 rubber industry: Arab oil embargo, 177– 178; automotive recession and, 140; deindustrialization and, 175–178, 187–188, 205; Gold Rush and, 72; tire manufacturing and, 204, 205; unionization of, 154 See also companies by name rubber shortage and price explosion (1910), 125–127 Rubber Workers Union, 178 rum industry, 9–11 Russian financial crisis (1998), 224–226 Rust Belt deindustrialization (1980s), 194–196 San Bernardino, California, bankruptcy (2012), 249–251 San Francisco earthquake (1906), xvii Saugus Iron Works, 15 savings and loan crisis (1986), 206–209, 208 (photo) Savings Association Insurance Fund (SAIF), 207 Schmitz, Kim, 230 Index Schwab, Charles, 138 Scotch-Irish citizens, 37, 38, 39, 59 Sears, 176 Securities and Exchange Commission, 230 Seiberling, F A., 140 Seneca Oil, 75 September 11 terrorist attacks (2001), 231–234, 233 (photo) Seven Years’ War, 18 Shays’s Rebellion, 30 Sherman Antitrust Act (1890), 112, 119 Sherman Silver Act (1890), 105, 113, 114, 290–294 shortages: anthracite coal, 119–121; Civil War, 83–85; coffee and toilet paper, 185; creativity in solving, 160–161; currency, 12–14; labor, 134–136; natural gas, 189–191; New England fuel, 96; rubber, 125–127, 161–163; of steel and strategic metals, 164–166; Union blockade and, 86–88; whale oil, 73–76; WWI, 127–129; WWII, 158–161 sin taxes, 32 Six-Day War, 183 slavery, 2, 4–6, 9, 36 Smith, Adam, 180 Smoot-Hawley Tariff Act (1930), 149 Social Security Act, 149, 150 Society for Establishing Useful Manufactures (SEUM), 35 Solar Iron Works, 100 Sons of Liberty, 20 South Carolina’s Exposition and Protest Against the Tariff of 1828 (Calhoun), 282–290 Spain, 246 Spalding, John, 121 Spanish flu pandemic (1918), 134–136, 135 (photo) Spanish-American War, 107 Spotswood, Alexander, 15 Springsteen, Bruce, 205 stagflation, 180–181, 183, 186 Stamp Act (1765), xvii, 19, 20–21 states’ rights, 61, 62 steel, metal, and alloy shortage crisis (1943), 164–166 steel industry: Bessemer process, 98–101; collapse of, 187, 201–203, 204–205; domestic production vs imports, 171–173; labor crises of 1882, 98–101; strikes in, 100, 136–139, 153–155, 171–173; unionization of, 154–155 See also companies by name Steel Workers Organizing Committee (SWOC), 154 Stevenson plan, 142, 143 stock fraud, 82 stock market crashes: after 9/11 attacks, 231; Asian financial crisis, 221–223; dot.com bubble, 229; European, 22; gold crisis, 88–90; Great Depression, 146–150; Great Recession, 239–241; Russian financial crisis, 224–226 strategic metals shortage (1943), 164–165 strikes: air traffic controllers, 199–201; anthracite coal miners, 119–121; coal and railroad workers, 110–112; Great National Railroad Strike, 93–95; labor unions, 153–155; Pittsburgh Puddler, 100; Pullman Company, 111–112; steel workers, 136–139, 167, 171–173; truck drivers, 183 subprime mortgage crisis (2008), 237–239 Sugar Act (1764), xvii, 19, 20, 260–262 Sugar Act, Currency Act, and Stamp Act boycotts, 19–22 Sun Rubber, 187 Supreme Court, 112, 119 Taft-Hartley Act (1947), 166–168, 168 (photo), 171, 198, 200, 294–304 See also National Labor Relations Act (Wagner Act) (1935) Tariff Act (1832), 62 Tariff Act (1890), 105, 106 Tariff Commission, 145 Tariff of Abominations (1828), 60–63, 282–290 tariffs: Andrew Jackson and, 63–66; Compromise Tariff, 62; economic impacts of, 58, 61; Fordney-McCumber Tariff Bill, 145; GATT Treaty, 169; McKinley Act, 105, 106; political battle over, 145; protective vs revenue, 61; Smoot-Hawley Tariff Act, 149; WTO approach to, 220 Taxpayer Relief Act (1997), 230 | 335 336 | Index Tea Act (1773), 22, 24 tea boycott, 21 technological changes: automotive industry, 175–178; deindustrialization and, 186, 186–188; glass industry, 52–53; oil and gas industries, 191; rubber/tire industry, 128, 175–178; steel industry, 98–101 “Tequila Crisis” (1994), 217–218 textile manufacturing, 205, 216, 219–220 Three Mile Island (1979), 191–194, 192 (photo) thrifts, 206 See also savings and loan crisis (1986) Tidewater plantation owners, 23 tire companies: bias-ply vs steel belted radials, 175–178, 188; unionization of, 154 See also rubber industry; companies by name tobacco depression (1703), 4–6 tobacco farming, 1–3, 4–6, 30 “too big to fail,” 239 Townshend Act (1767), 19, 21, 22 Toyota, 174 Trans-Alaska Pipeline Bill (1973), 182 Transcontinental Railroad, 91 Transocean, 246 Trenton, New Jersey, 205 triangular trade, Troubled Asset Relief Program, 243 Truman, Harry, 198 Tuskegee Institute, 133 Union blockade and inflation (1862), 85–88 Union India Rubber Company, 72 Union Pacific Railroad, 91 unionization: of automotive industry, 153, 166; of mineworkers, 110–112; of railroads, 93–95; of rubber workers, 154; of steel workers, 154–155; worker uprisings 19361939, 153–155 unions: air traffic controllers, 199; Detroit bankruptcy and, 254, 256; National Labor Relations Act (1935), 157; Taft-Hartley Act (1947), 166 See also unions by name United Auto Workers, 194, 195, 242, 243, 244 United Copper Company, 122, 123 United Mine Workers of America (UMWA), 110, 111, 119, 120 United Nations, 169, 170 United Peanut Growers Association (UPGA), 144, 145 United Rubber Workers, 154 United States Navy, 43 United States Steel, 137–138, 139, 154, 157, 202 United Steelworkers of America (USWA), 167, 171, 178 Unsafe at Any Speed (Nader), 175 U.S Exchange Stabilization Fund, 218 U.S Rubber, 126, 141 Vanderbilt, William, 119 victory gardens, 128, 158, 159 Vietnam War era, 178, 179 Villard, Henry, 102 Virginia, 1–3 Volkswagen Beetle, 174 “voting your pocketbook,” 1, 47 wage and price controls (1971), 178–181, 185 Wagner, Robert, 153 Wagner Act (National Labor Relations Act) (1935), 153, 166 Wall Street Crash (1929), 146–148, 148 (photo) Walmart, 219–220 War Board, 165 war contractors, 27 war financing crisis (1776), 24–28 War of 1812, 47, 48–51 War of the Spanish Succession, 4, 5, War on Terror, 233 war shortages: WWI, 127–129; WWII and 1940s, 158–161 Ward, Ferdinand, 104 Washington, George, 17, 31, 37, 38–39, 39 (illust.), 41, 44 West Indies, 9–10 Westinghouse Electric, 123 whale oil, 72–75, 74 (illust.) whale oil shortage (1850), 75–76 Wheeling-Pittsburgh Steel, 204 Wheelwright, Nathaniel, 20 Whig Party, 52, 61, 68 whiskey production, 37–40 Index Whiskey Tax Rebellion (1794), 37–40, 39 (illust.) Wilson, James, 42 Wilson, Woodrow, 136, 146 Winthrop, John, 15 World Bank, 169 World Trade Center, 233 (photo) World Trade Organization (WTO), 169, 170, 220 World War I, 127–129 World War II, 158–161 WorldCom, 230 Xcelera.com, 230 Y2K crisis (2000), 226–229, 227 (photo) Year 2000 Information and Readiness Disclosure Act, 227 Yeltsin, Boris, 224 Yom Kippur War, 181, 182 | 337 This page intentionally left blank About the Author Quentin R Skrabec Jr., PhD, is professor of business at the University of Findlay in Findlay, Ohio His published works include ABC-CLIO’s The 100 Most Significant Events in American Business: An Encyclopedia, which was named a Notable Business Reference by the Reference & User Services Association in December 2013 He has published more than 20 books on American business and economics Skrabec holds a doctorate in management from the University of Toledo and degrees from the University of Michigan and Ohio State University .. .The 100 Most Important American Financial Crises This page intentionally left blank The 100 Most Important American Financial Crises An Encyclopedia of the Lowest Points in American Economic. .. of Congress Cataloging -in- Publication Data Skrabec, Quentin R â•… The 100 most important American financial crises : an encyclopedia of the lowest points in American economic history / Quentin... chosen based on their impact on the American economy All of these economic and financial low points are American, but they range from large regional problems to national and international bubbles,