USA > Indiana > The war purse of Indiana; the five liberty loans and war savings and thrift campaigns in Indiana during the world war > Part 14
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144
INDIANA WORLD WAR RECORDS
Final Reports for Twenty-four Southern Counties
The twenty-four southern counties as a whole subscribed for $20,672,700 on a total quota of $18,765,000, or 112 per cent. of total quota. Each of the twenty-four southern coun- ties with the exception of Warrick exceeded its quota. The reports for the southern twenty-four counties as copied from the Eighth Federal Reserve Bank records of St. Louis are submitted herewith :
County
Chairman
Quota
Subscription
Clark
Homer M. Frank
$609,000
$766,050
Crawford.
W. J. Hawkins
203,000
207,200
Daviess
M. F. Burke
484,000
598,450
Dubois
. Felix L. Schneider
552,000
561,850
Floyd
H. E. Jewett.
920,000
1,208,600
Gibson
Frank M. Harris
877,000
943,300
Greene
Q. T. Mitchell
741,000
822,200
Harrison
W. E. Cook
308,000
401,400
Jackson
J. H. Andrews
602,000
776,250
Jefferson
J. W. Cornett
646,000
674,950
Knox
J. L. Bayard, Jr
1,830,000
(a)1,942,700
Lawrence
T. J. Brooks.
400,000
476,300
Martin
Edgar Witcher
152,000
173,700
Orange
Owen C. Ham
294,000
315,750
Perry
W. F. Huthsteiner
326,000
365,550
Pike
George A. Hurst
292,000
333,000
Posey
John W. Turner.
839,000
1,080,650
Scott
W. M. Wells
102,000
166,600
Spencer
T. E. Snyder
353,000
395,750
Sullivan
J. F. Bolinger
916,000
969,450
Switzerland
Frank Riley
202,000
220,050
Vanderburgh.
John J. Nolan
6,338,000
6,458,800
Warrick
Louis W. Bohn
492,000
(b)482,950
Washington
Otto C. Zink
287,000
331,200
Totals
$18,765,000
$20,672,700
(a) For Knox County Liberty Loan Committee, see footnote, page 69.
(b) A letter dated April 18, 1922, from Louis W. Bohn of Boonville, reported that Warrick County exceeded its quota in the Fourth loan, but no official reports or records were submitted to support this statement.
2
SURE! We'll Finish the ob
Cerril A Boneker 1918
VICTORY LIBERTY LOAN
CHAPTER VI. THE VICTORY LOAN IN INDIANA
The story of the Victory loan in Indiana must open with a backward glance to the eventful dawning of November 11, 1918. For on that day the war-sickened peoples of the world climbed from their trenches of death and knew that civiliza- tion was to be saved, after four long years of the bloodiest conflict known to history. To describe the exultation of those first hours of peace will be forever impossible. Only in each human being's heart-after its own fashion-is the story recorded.
Relief, boundless as had been the gulf of war, surged into the hearts of three million Hoosiers on that November morn- ing. After the first moments of silent thanksgiving, that re- lief burst forth in shouts, in the ringing of bells, in the firing of cannon, in the shrieking of whistles, in the marching of exulting thousands along city streets and country lanes- happy, free from fear, safe!
In six hundred thousand Hoosier homes the full meaning sank deep into Indiana's soul. And the pent-up hopes of a free people broke out into a riotous celebration all over In- diana, and all over America. The end had come at last. Armistice Day was to take its place from that time forward in the hearts of the men, women and children of that gener- ation as their Greatest Day. Again the Liberty bells might ring throughout the land. From the spires of schools and churches they pealed forth a glad message, and prayers of thanksgiving were offered up from the hearts of people every- where. At last had come Victory! Few realized before that day the full meaning of this word. That day made Americans know why our bells are called 'Liberty bells'.
William Herschell, in an unsigned verse, told the story in his way on that day in Indiana following receipt of the cable dispatch, announcing that the Armistice had been signed :
"It was 3 a. m. on this day of Foch, That the town awoke from its Sunday hush ; Awoke with a crash, a smash and a cheer, To welcome the news that peace was here; Awoke with a yip, a whoop and a yell, For Mitteleuropa had gone to h-1!"
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INDIANA WORLD WAR RECORDS
Throughout the nation the millions of Americans, who had been transformed in less than two years into a fighting ma- chine, threw off the yoke of war and-grandly and elaborately, as Americans will, set about the business of being through with war. No day in American or Indiana history had ever been like that day. The emotions which rise for the Declar- ation of Independence, the surrender of Lee, the Battle of Santiago, the victory of the laughing Yanks at Chateau Thierry, combined in a great Thanksgiving and just rolled up into one American heart-climax and exploded. The Arm- istice! Peace! Victory !
To have lived through that day in the world-well, noth- ing can tell the story fully. Not even the lips of the mothers, who knew that day their boys would come back to them. Just the one word comes nearest-to those who heard it in the trenches of Europe, and those who heard it back in Indiana- "Peace".
Governor Goodrich, still on crutches from his earlier injury was lifted to a table in the State House corridors that day, while thousands crowded about, in the first wild outburst of relief.
"Fellow Americans-I can't tell you how happy I am that God still rules instead of the Kaiser," said the Governor, in a voice trembling with emotion. "The victory won by the allies and our American boys has demonstrated that there is a higher power than human might, and that a nation founded on brute force cannot rule the world. This war marks the end of irresponsible government. God still rules above all."1
A firm-jawed old woman, carrying a service flag in her left hand, was photographed for the newspapers among the crowds that day. She wouldn't give her name; modesty forbade it, the newspaper said. But her right hand carried the simple message of the people of Indiana and the world. It was on a big square of cardboard, and the lettering was uncouth. Here is what it said:2
HAPPIEST DAY OF MY LIFE
1. Indianapolis News, November 11, 1918.
2. Indianapolis Star, November 12, 1918.
147
THE WAR PURSE OF INDIANA
A Period of Reckless Spending
Many in Indiana settled down, after that first wild day of rejoicing, to a realization that there was yet much to be done before actual peace was established. There were others how- ever, who refused to take up the new responsibilities accom- panying the work of reconstruction, but went on in their mad celebration of peace, even until it seemed that grave disaster might come. Reckless spending soon took the place of rigor- ous thrift everywhere in Indiana and elsewhere throughout- the nation. Entrepreneurs, who had been held in leash throughout the war, began to utilize the newly released en- thusiasms over peace and numerous were the schemes devised to absorb the surplus funds of the people in ventures that were doomed to failure. This wild riot of extravagance and get-rich-quick speculation seemed to spring up almost over- night.
Government officials, bankers and business men generally knew, of course, that the financial problems of the country were not over; that enormous expenditures yet were to be made; that the vast army in Europe must be returned to America; that cancellation of Government contracts would work hardships on many industries; that swift action must come if America were to take advantage of the world trade, which lay at her doors; that starving peoples of the warring countries must yet be fed by America; that a more compact basis of industry must take the place of the hurriedly molded war production program; that finances must be arranged for all these readjustments ; that the Government still would need money on as large a scale as during the war to pay for the aftermath.
Yet through all the fears, doubts and worries of those months immediately following the Armistice, there was pre- valent in Indiana a dominant note of optimism, due no doubt, to the fact that never before in the history of the people of the state had general good times prevailed so definitely. Wages were high.3 Labor was scarce. The returned soldier
3. Bulletin No. 286, U. S. Department of Labor, entitled "Union Scale of Wages and Hours of Labor," May 15, 1920, states on pages 5-6, that the union scale of wages listed in this Bulletin were obtained from 1,054,204 members of organized trades and occupations in 66 of the principal cities located in 36 states of the Union. It shows that in all trades taken collectively the increase in weekly wage rates on May 15, 1920, exceeded those of the year 1913, 89 per cent .; the increase over the 1910 wages was 98 per cent. The regular hours of labor had decreased 6 per cent. as compared with 1913. Rates of wages per hour in 1920 were 99 per cent. higher than in 1913 ; 111 per cent. higher than in 1910.
148
INDIANA WORLD WAR RECORDS
was not yet the assimilation problem that he was sure to be- come. Money apparently was plentiful, and prosperity was on the lips of all men.
America was the store-house of the world. And heavy profits are made when the demand far exceeds the supply, as was the case then. The need for conservation of foodstuffs perhaps was even more sharp than it had been during the war -- with Europe starving as she seemed to be in those latter days of 1918 and early days of 1919-but, somehow, it be- came de trop to conserve, and more romantic to spend. For there were many dollars in the land-too many in fact.
Hoosier bankers and other financial leaders during the pe- riod between the signing of the Armistice and the opening of the Victory loan campaign in the spring of 1919, believed that the dominant note for the future in Indiana was prosperity, yet continuing prosperity would come only if cautious progress were the watchword during the reconstruction period. While there were diversified opinions regarding the exact extent to which business would revive, and the speed with which normal conditions would be resumed, nevertheless the financial leaders were unanimous in believing that somehow or someway Indi- ana would again take its full quota of the Fifth Liberty Loan. A note of confidence was expressed in the future of manufac- turing business in the state. Agriculture which was the bed- rock of Indiana's business resources was sure to expand. It was pointed out in many communities that hogs alone had more than paid the total quotas of the various Liberty Loan and War Savings campaigns.4
In a summary of Indiana business and financial conditions, printed December 31, 1918, it was pointed out that a note of optimism was uppermost in the minds of Indiana bankers generally. The report went on to say :
"Indiana bankers, on the eve of the world's most significant New Year, hold diversified opinions regarding the future, yet few of them see real clouds on Indiana's horizon. They are unanimous in believing that somehow, someway, Indiana again will take her full quota of the Fifth Liberty Loan. They are unanimous in believing that the bed-rock foundation of
4. Report of the United States Bureau of Crop Estimates for Indiana, 1919, com- piled by George C. Bryant, showed that approximately 7,000,000 hogs were raised in Indiana during the two years 1918-1919. Estimating each hog at $40 (a conservative price for the years mentioned), the total value of hogs produced on Indiana farms for the war period exceeded more than a half billion dollars,-or would have paid the entire cost of the war financing in Indiana.
149
THE WAR PURSE OF INDIANA
Hoosier agriculture cannot be shaken and that this greatest source of wealth is to expand. The manufacturing situation in Indiana, viewed broadly, seems little injured by the war, and, barring possible trouble between capital and labor, which the right-minded leaders are trying systematically to avoid, development and expansion of production in Hoosier industry is assured for perhaps a long period of years. Manufactur- ing credit is not to be withheld by the banks, wherever safe and sane enterprise calls for financial assistance, the majority of the bankers say.
"The necessity for immediate attention to the road problem in the state, in order that the vital transportation fabric shall be kept more nearly abreast of the expansion in business and its basic agriculture, was commented on by practically all the bankers, who discussed the future of the state.
"Some pessimism, usually reflected from outside quarters, is evident among manufacturers, who have been hit by the cancellation of war contracts, but many of the bankers see a slow readjustment even in these particular lines of business to a point where profit-losses will be met by expansion in pro- duction of non-war essentials, and very few of them look for real depression generally in Hoosier manufacturing. That the readjustment already has started and that it is to be ex- tremely slow in many channels of the life of the state, is the consensus of opinion of Indianapolis and outstate bankers as well. Everywhere the belief in the Hoosier as an individual, backed up by the wonderful qualities he has shown during the war period, gives a firm background of safety to the pictures of the coming year. ",5
Mad Spending of the Newly Rich
The spending orgy which continued long after the recon- struction began, had more or less natural economic causes. The greatest probably was the sudden release of vast new wealth from a very definite war purpose to the less rigid demands of peace. While the "claquers" shouted "panic" and "stringency" and "world bankruptcy", the newly rich of America passed them by, hurrying to the nearest haberdash- ery to buy a five dollar necktie, before somebody with a larger "roll" came along to pay the haberdasher six dollars for it. Thus was the volume of new wealth in the country redistrib-
5. See Economic and Financial Viewpoints of Indiana Bankers, Walter Greenough. Files Fourth Liberty Loan.
150
INDIANA WORLD WAR RECORDS
uted, in many instances, swiftly ; so that there came to be very shortly another set of rich Americans, who spent in profusion -- and another locust came and carried off another grain of corn, ad infinitum.
Yet cautious men and women saw that the vast orgy of ex- travagance must end sometime; that wages would decline as prices declined with falling demand from Europe, and that unemployment would follow. And so, many there were, who "feathered their nests" in those days against the time when the world should get back to normal, and the paradox of the dollar, cheap in America and costly in Europe, should be cor- rected. It is reasonable to suppose, looking backward to the history of former reconstruction periods, that the foundations of vast fortunes of the future were laid in 1919 in America, when the dollar was the cheapest thing you could buy, par- ticularly if you paid off your debts with it.
Into the virgin field of new investors (Liberty bond buyers) rushed an army of "wildcatters" and bond "sharks", held back almost constantly during the war by public sentiment everywhere. And the harvest they reaped was plentiful. They became so obnoxious in Indiana that Federal officials eventually sounded warnings to the people of the state through the banks and the press and in other ways. Unwary Liberty bond holders were easy prey. And questionable securities fairly flooded the field for a time.
The Loan files show that Indiana newspapers were "scruti- nized" carefully by representatives of the Federal Trade Com- mission, co-operating with the state Victory Liberty Loan committee in a search for advertisements offering for sale stocks or bonds of questionable or doubtful value, and of bond buyers who were 'scalping' Government securities. Finally it became necessary to call attention to this despicable prac- tice, and the following letter was sent out from the state Loan headquarters to the hundreds of banks in Indiana :
Indianapolis, Ind., February 5, 1919
To the Bank Addressed :
"Recently the state headquarters has been deluged with re- ports from all parts of the state that unscrupulous and un- principled 'sharps' are preying upon the ignorance of the small bond holder, who through unfortunate circumstances is compelled to sell his $50 or his $100 bond.
151
THE WAR PURSE OF INDIANA
"Many of these sellers unfortunately are easy victims, who, not knowing their bonds are the most liquid and convertible securities in the world, sell at whatever figure they can get. In some instances we have heard of $50 bonds selling for $30; and repeatedly the price is $90 or below for $100 bonds.
"Such a thief is more despicable than the highway robber who gets "his" at the point of a revolver. The situation is working to the decided disadvantage of Liberty bonds, pres- ent and future, as well as robbing your community of thou- sands of dollars honestly earned and saved by toil and sacri- fice.
"We appeal to you as respected bankers of your community to educate your small bond holder in the true worth of his investment. Do this through notices in your bank giving the daily quotations on Liberty bonds, or get your local papers to quote them. Urge the people when selling to consult their banker-not some wolf in sheep's clothing.
"Aid us in this propaganda for the good of your own com- munity, as well as the good of the state and nation."
Very truly yours, Signed : WILL H. WADE Director of Sales6
Gradually it also became apparent that the holders of Lib- erty bonds were dumping them on an already sagging market out of mere desire to realize some fancied need-usually a luxury. This seemed to be particularly true of the small holder of bonds. With the Victory Loan coming on, state headquarters made a further effort to remedy the situation, by issuing a special letter to the executive officers of many Indiana factories.
February 24, 1919
To the President of the Factory Addressed :
"My Dear Sir-Somewhere in your community lives a 'Skin- flint' who should be driven out of it. He is buying Liberty bonds from your employes at far less than they are worth, and thereby robbing them and the community of hundreds of dollars.
"Those employes need your protection. Tell them to come to you when they are compelled to sell a bond and you will give them all it's worth.
6. Files Fifth Liberty Loan; letter dated February 5, 1919.
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INDIANA WORLD WAR RECORDS
"Your local banks will buy the bonds from you at the market price, less a small commission to cover expense of handling. If they are not anxious to do this, advise us and we will see that you are accommodated in Indianapolis.
"Let your employes understand whenever the necessity of selling arises you will give them all their bonds are worth. "This protection will win the confidence of your help-will profit them and your community, and will go far to stamping out the present evils.
Soliciting your earnest co-operation, we are
Very truly yours,"
Signed: WILL H. WADE Director of Sales for Indiana?
Wide Distribution of Liberty Bonds in Indiana
The distribution of the Fourth loan bonds in Indiana ap- parently had reached a degree which left the banks through- out the state in splendid position to absorb huge quotas of the certificates of indebtedness, issued by the Government in an- ticipation of the Victory bonds.
While this factor was much in favor of the successful flota- tion of the last great war loan, it was also true that the market prices of the outstanding bonds were further depreciated- due primarily to the enforced selling of relatively small por- tions of the holdings of investors on the open market. These sales totalled, however, enough to show definitely that the sup- ply of "open market" bonds far exceeded the demand. This was very natural, when it was remembered that the volume of Government obligations then outstanding exceeded that of any period in the history of Government finance.
This condition of affairs in Indiana was the subject for edu- cational efforts on the part of bankers and others, among the new bond holders. Leonard L. Campbell, in a summary of bond market conditions, declared that this education had very definite results in Indiana.
"The fact that there never was any question concerning the real value of the bonds was accented during this period", said Mr. Campbell. "Where bonds were selling at 95 per cent. of par, banks and individuals familiar with investments urged the owners not to sell their bonds, since they were the best and safest investment in the world and were worth, at maturity
7. Ibid. Letter dated February 24, 1919. .
.
153
THE WAR PURSE OF INDIANA
dates, at least their face value, and probably would bring a long premium. This advice from bankers and reputable in- vestment men resulted in fewer bonds being sold in Indiana by owners than in other states. In fact, at no time during the war did the amount of bonds sold by Indiana persons in- jure the demand for them by Indiana investors. It was nec- essary at all times for the banks and investment houses of the state to purchase from New York and Chicago additional Lib- erty bonds of the various issues in order to supply their cus- tomers. In this connection it may be safely stated that Indiana not only purchased Liberty bonds of the various is- sues during the campaigns to the amount of at least four hun- dred fifty millions, but that the state purchased on the open market during the war period an additional supply, conserva- tively set at seventy-five million."8
That the banks of the state were in position, after the Fourth loan, to absorb large amounts of the anticipatory cer- tificates of indebtedness for the Victory loan and the tax an- ticipation certificates, was proved by actual results. It was estimated that banks in the Seventh Federal Reserve terri- tory in Indiana purchased, roughly, 130 per cent. of the total certificate quotas allotted.9
Many New Chairmen Named for Victory Loan
In the early days of 1919, when it had become a certainty that another great bond issue would have to be used by the government to retire its short-term war indebtedness and otherwise adjust itself financially to the coming of peace, Loan executives immediately detected a waning of enthusiasm on the part of war workers. Men and women by this time had turned their faces very definitely from the sorrowful back- ground of the strenuous two-year period of the war.
The power of public opinion in Indiana, that had kept the state steady throughout the long days of the war, now began to disintegrate. And a widespread feeling appeared that had self as the dominant note, where team work had been the watchword before. The trivial business of men came again to take up their time, and the exaltation of patriotism, which had kept them at war tasks with utter disregard of money, or
8. Notes of Leonard L. Campbell. Fifth Liberty Loan Files. Definite figures are not available as to the amount of government securities purchased in the open market by Indianans during the interims between the various bond campaigns.
9. Ibid.
154
INDIANA WORLD WAR RECORDS
comfort, seemed to have been lost in those wild revels of Arm- istice Day.
Then, too, there were many who had made such real sacri- fices of time, money and business during the war that they were forced to plunge into the pre-war harness again at top speed to save what they could from wreckage and disorganiza- tion. Of this latter type were many of the Liberty Loan county chairmen throughout Indiana, who had stepped from the bank, factory, or large private interests to give their whole time to the winning of the war. When the Fifth or Victory loan came on, dozens of these men felt that it was time for others to take up the burden, while they caught up with their business, after the two-year loss of time.
The Liberty Loan organization throughout the nation faced much the same problem as did the state executives in Indiana. Resignations by wholesale from the county chairmen poured into Loan headquarters, as soon as efforts to organize for the Victory loan began. The Loan files show that more than thirty of the county chairmen in the northern counties were supplanted with new timber for the Victory loan. And the difficulty did not stop with the resignation of the old chairman and the appointment of a new. In county after county it seemed for days that no one would be found willing or strong enough to accept the postwar Loan responsibility. Corres- pondence shows that sometimes half a dozen men in a county would be approached from various angles in efforts to induce them to serve as chairman, only to have them wriggle out on one pretext or another.
On February 24, 1919, when the problem of reorganization was becoming real, Guy W. Cooke voiced the feeling in the Seventh Federal Reserve headquarters, in a letter to Indian- apolis officials, when he wrote that they believed "we face the most difficult task yet presented the War Loan Organization."
Mr. Cooke, who was in charge of the Indiana state head- quarters in Chicago, wrote to the Indianapolis headquarters, concerning the kaleidoscopic changes in county chairmen, under date of March 12: "It is bright and shining here to- day, so we hope the flickering lights in the troublesome coun- ties will be replaced by the bright glow of new incumbents."10
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