Linking Chicago’s 1893 Exposition, Columbus, the U.S. Sanitary Commission and murder

A National French Draft Horse Association gold medal awarded to Ed Hodgson at the 1893 Columbian Exposition sold for $14,400 at an August 2019 Heritage auction.

By Jim O’Neal

In 2003, I got a reliable tip about a new non-fiction book, The Devil in the White City by Erik Larson. The author skillfully weaves two complex stories into an entertaining narrative. The story revolves around the 1893 World’s Columbian Exposition in Chicago (“The White City”) and the riveting true story of H.H. Holmes (“The Devil”). Holmes is credited with being the first American serial killer after he lured as many as 200 people into his “Murder Castle.” At the same time, Jack the Ripper was plying his trade in London. Several attempts have been unsuccessful in linking these two monsters.

In 2010, Leonardo DiCaprio bought the film rights to the best-selling book and, presumably, his production company, Appian Way Productions, will eventually be turning out a movie. A short list of films by the studio includes The Aviator, Public Enemies, The Wolf of Wall Street and the Oscar-winning The Revenant. The production company has collaborated with Martin Scorsese and Clint Eastwood on several entertaining films, but it’s not clear if any other organizations will be involved. Larson went on to write several other excellent books that I can safely recommend for your enjoyment.

The 1893 Columbian Exposition was designed to celebrate the 400th anniversary of Christopher Columbus’ voyages to the New World. The Italian explorer and navigator made four voyages in 12 years (1492-1504), primarily searching for a shorter trade route from Europe to Asia. He was unsuccessful and, curiously, despite never setting foot on North America, is honored with a national holiday. Hence, America derives its name from a different Italian explorer, mapmaker Amerigo Vespucci, who also claimed to have made several voyages to our ZIP code.

However, Columbus is credited with opening the Western World, which resulted in significant trade and the European colonization of our neighbors. His trips include contact with Hispaniola (Haiti and the Dominican Republic), Cuba, Central and South America and several of the smaller Caribbean Islands. Latter-day historians have been critical of his treatment of the indigenous people. In addition to slavery, the “Columbian Exchange” was responsible for exposing local inhabitants to new diseases that resulted in widespread death due a lack of immunity (sound familiar?). Trade provided Europe with an amazing array of new foodstuffs, like the 200-plus varieties of potatoes from Chile, along with tobacco and dozens of others too numerous to list.

There was vigorous competition to host the 1893 Fair – with St. Louis, Chicago and New York City the leading contenders. NYC had powerful backers, with Cornelius Vanderbilt, William Astor and J.P. Morgan agreeing to provide $15 million in financing. But Chicago had their own heavy-hitters, who matched the $15 million and finally prevailed. They were especially motivated since this kind of visibility would provide an excellent opportunity to demonstrate they had fully recovered from the ashes of the Great Fire of 1871, which was wrongfully blamed on Mrs. O’Leary and her innocent cow. The event was a commercial success, with over 27 million visitors from 46 countries. The “White City” nickname was derived from the color of the facade of the 14 major buildings designed by some of the world’s most prominent architects. Plus, it didn’t hurt that a civil engineer named George Washington Ferris Jr. showed up with his now-famous wheel that could thrill over 2,000 people, fully loaded, at 50 cents per passenger. At over $1,000 per ride, it was the equivalent of having a U.S. Mint without having to buy any silver.

The real factor in the exhibition’s success was the remarkable skill of one man, Frederick Law Olmsted, primarily known for his work as superintendent for Central Park in New York. He had been a mere 35 years old and was soon in charge of thousands of workers. Then, the Civil War started and Olmsted took a short leave of absence since everyone was convinced it would be over very quickly. A carriage accident prevented him from joining the army to fight but, fortunately, he was asked to become the leader of the U.S. Sanitary Commission. When the war started, Northern forces consisted almost exclusively of volunteers that totally lacked the capability to provide medical assistance or even food to wounded soldiers. With Olmsted in charge, the Sanitary Commission raised funding and supplies from ordinary citizens and then devised means to deliver medical attention, food, tents and blankets to wounded soldiers right on the battlefields. This was an early example of Uber, but without an iPhone.

His reputation grew and 30 years later, the CEO of the Columbian Exposition hired him to organize everything in Chicago. Piece of cake.

I hope President Biden can find someone with just 5 percent of Frederick Olmsted’s skill and experience. Otherwise, it’s going to be a long four years.

Intelligent Collector blogger JIM O’NEAL is an avid collector and history buff. He is president and CEO of Frito-Lay International [retired] and earlier served as chair and CEO of PepsiCo Restaurants International [KFC Pizza Hut and Taco Bell].

A little history helps put the 2020 election in perspective

This $1000 1882 Gold Certificate, Fr. 1218f (PCGS Very Fine 35) – with a vignette of Alexander Hamilton, the first Secretary of the Treasury – realized $293,750 at a January 2014 Heritage auction.

By Jim O’Neal

If our past is any guide to the future, I suspect that presidential politics will be a primary source of contention for several electoral cycles. The United States has produced some unusual presidential elections and the 2020 Biden vs. Trump race is not an isolated event that warrants exceptional anxiety.

A little history helps keep it in perspective.

During the 1787 Constitutional Convention, there was a long debate over the method for selecting a president. Among the proposals was whether the chief executive should be chosen by a direct popular election, by the Congress, by state legislators or intermediate electors. Direct election was rejected primarily because of a concern that common citizens would probably lack sufficient knowledge of the character or qualifications of candidates that would enable intelligent choices. Candidates would be spread throughout the 13 colonies and campaigning was not a viable option due to travel difficulties.

Letting Congress decide was quickly rejected since it would jeopardize the principle of executive independence. Similarly, allowing state legislatures to choose was turned down because the president might feel indebted to some states and allow them to encroach on federal authority.

Unable to agree, on Aug. 31, the Convention appointed a “Committee of Eleven” to resolve it. On Sept. 4, a compromise was agreed with each state appointing Presidential Electors, who would meet in their states and cast votes for two persons. The votes would be taken to Congress to be counted, with the candidate receiving a majority elected the presidential candidate and the second highest vice president. Since there was no distinction between which vote was specifically designed by position, the 12th Amendment was ratified 1804 to distinguish individual votes between the two offices.

Now the conventional election of president and vice president is an indirect election in which (only) citizens, who are registered to vote in Washington, D.C., or one of the 50 states, cast ballots for members of the Electoral College. Those electors cast the direct votes and it requires at least 270 electoral votes to win. In 1960, the 23rd Amendment granted D.C. citizens the same rights as the states to vote for electors, but they can NEVER have more votes than the least populous state. To date, they have never had more than three electors. Also, they do not have any rights to vote for senators or amendments to the Constitution.

For more than 200 years, Americans have been electing presidents using the Electoral College, but despite its durability, it is one of the least admired political institutions. Thomas Jefferson called it “the most dangerous blot on our Constitution.” It’s been an easy target for abolishment or modernization and polls consistently report citizens would much prefer a simpler direct election. However, amendments require a 2/3 majority in both the House and Senate or a complicated state ratification convention with 3/4 approval. This process has never been attempted.

This outdated system has led to a number of anomalies at times. In 1836, the Whigs tried a novel approach by running different candidates in different parts of the country. William Henry Harrison ran in New England, Daniel Webster in Massachusetts and Hugh White of Tennessee in the South. By running local favorites, they hoped to subsequently combine on one candidate or force the election into the House. The scheme failed when Democrat Martin Van Buren captured the majority.

Another quirk of fate occurred in 1872 when Democratic nominee Horace Greeley died between the popular vote and the meeting of the electors. The Democrats were left without an agreed candidate. Forty-two voted for Governor Tom Hicks … 18 for Gratz Brown … two for Charles Jenkins and three Georgia electors cast their votes for the dead Greeley (Congress refused to accept them).

In 1912, President William Howard Taft and ex-President Theodore Roosevelt caused a split in the Republican Party that allowed Democrat Woodrow Wilson to become president. On Oct. 14, just before a major speech, a fanatic named John Shrank stepped up, shouted something about a third term and shot T.R. in the chest. Roosevelt yelled at the crowd to stand back and declared “I will make this speech or die. It is one thing or the other!” He went on to make a 90-minute speech before heading for the hospital. The bullet had lodged in the massive chest muscles instead of penetrating the lungs! Wilson won but Taft finished a weak third place.

Lastly, compared to “the Revolution of 1800,” the 2020 election was mild and relatively free of widespread disorder. The 1800 campaign was so bitter that VP Aaron Burr ended up killing Alexander Hamilton in a duel and John Adams and Thomas Jefferson would not communicate with each other for 12 years.

Neither Abigail nor John Adams would attend the inauguration. Sound familiar?

Intelligent Collector blogger JIM O’NEAL is an avid collector and history buff. He is president and CEO of Frito-Lay International [retired] and earlier served as chair and CEO of PepsiCo Restaurants International [KFC Pizza Hut and Taco Bell].

Virginia’s soil was fertile ground for tobacco … and fresh ideas about freedom, governance

Sommer Islands coinage, or “Hogge Money,” was the first coinage produced for circulation in the English-speaking colonies of the New World. This (1615-1616) sixpence, Large Portholes Variety, sold for $99,875 at a January 2017 Heritage auction.

By Jim O’Neal

The Jamestown settlement in the Colony of Virginia is credited with being the first permanent English settlement in the Americas. The Colonists had sailed in a fleet of three ships: the Susan Constant, Discovery and Godspeed – under the command of Captain Christopher Newport (1561–1617) and arriving in 1607. They endured repeated failures and humiliations as a commercial entity.

King James (1566-1625) revoked the London Company’s charter in 1624 after a cumulative investment of 200,000 lb. sterling and over 100 additional shipments of supplies to keep them going. But it was a combination of an Indian massacre in 1622 and a seeming inability to develop a viable economy that prompted the king’s action. Their inability to protect the king’s people resulted in Virginia ceasing to be a commercial company and instead being governed as a mere Colony.

As early as the 15th century, European explorers had observed American Indians smoking tobacco, presumably for ceremonial or medicinal purposes. In the 16th century, ships returning to Spain brought back tobacco and it was soon adopted as a therapeutic cure-all throughout the entire Iberian Peninsula. Naturally, it spread to England after Sir Francis Drake (c.1540-1596) brought supplies of tobacco leaf and seeds for planting. By 1600, pipe smoking had become popular in upper-class London society.

Surprisingly, King James objected quite strenuously and published (perhaps) the very first treatise against tobacco in 1604: “A Counterblaste to Tobacco.” He questioned why honorable men would “imitate the barbarians and beastly manners of the wilde, godless and slavish Indians especially in so vile and stinking custome.” Much of the rest of the tirade/admonition, would fit very well with modern anti-smoking efforts still active in many parts of the world.

Refuting a view that tobacco was a magic cure for everything, he asked, “What greater absurdity can there be than to say that one cure shall exist for all divers and contrarious sorts of diseases?” He then went on to point to poisoning of the lungs and disruption in the function of organs. Finally, the treatise compared tobacco use with “a branch of the sin of drunkenness, which is the root of all sins!”

The Virginia Colony, by not being able to keep the king’s subjects safe from Indians and losing their charter, missed a chance to control the tobacco monopoly, which turned out to be America’s most valuable commodity in the 17th and 18th centuries.

When a young man named John Rolfe (1585-1622) planted seeds of a Spanish variety from the West Indies, “Never was a marriage of soil and seed more fruitful,” wrote Joseph Robert in his Story of Tobacco in America. Virginia soil along the James River (named for the anti-tobacco king) proved to be an enormous success. By the end of the 18th century, Virginia and Maryland were shipping 70 million tons of tobacco to England each year.

Rolfe, of course, would go on to marry Pocahontas (c.1596- 1617), the daughter of the influential Indian Chief Powhatan, in April 1614. She had been a captive of the Colonists during hostilities in 1613, converted to Christianity and baptized as Rebecca. The Rolfes soon traveled to London, where Rebecca was introduced as a “civilized savage,” all in a failed attempt to gain more investment in Jamestown. When the Rolfes set sail back to Jamestown, Rebecca became ill and died. Pocahontas had become a semi-celebrity in England and numerous places are named for her.

The Colonial focus on tobacco presented a risk to the “tillage of corn,” which was essential to basic food supplies needed to feed the people. The governor decreed that every man must plant two acres of corn before planting any tobacco. Then another consequential event occurred in 1619. A Dutch man-of-war sold the Company “20 and odd” Black slaves – the first slaves in what would become the American Colonies.

From these modest beginnings, there was a major shift in labor from White indentured servants to African slaves in the labor-intensive activities for tobacco cultivation, harvesting and curing. By 1860, 350,000 were cultivating tobacco – an exploitive crop that exhausted the soil and required constant cleaning of new land. Throughout the Colonial period, production of tobacco was centered in the Northern port cities, but the surplus slave labor, supply of raw material and manufacturing shifted to the South. By 1765, Virginia and Maryland tobacco combined to represent 80 percent of American exports.

Leading up to the American Revolution, South Carolina exported more than all the Northern Colonies combined and became a majority slave Colony. Of a population of 125,000, about 75,000 were slaves. Virginia had more Blacks than New York had Whites. On the eve of liberty, the majority of American exports were produced by slave labor.

Predictably, as the concentration of wealth grew, the men who controlled tobacco controlled Virginia politics. One generation into the 18th century, Virginia’s most esteemed citizens comprised a landed aristocracy – but much like the modern oil state that usually fails to develop other economic capability. However, a significant exception is that Virginia’s soil was fertile ground for fresh, new ideas on freedom and governance. This relatively small area supplied an abundance of intellectual foundations and some obvious contradictions to the coming American experiment.

We are still learning.

Intelligent Collector blogger JIM O’NEAL is an avid collector and history buff. He is president and CEO of Frito-Lay International [retired] and earlier served as chair and CEO of PepsiCo Restaurants International [KFC Pizza Hut and Taco Bell].

Sir Walter Raleigh lived in an important time in England’s history

A 1937 Roanoke Half Dollar, a commemorative authorized to celebrate the 350th anniversary of the establishment of Sir Walter Raleigh’s North Carolina colony, sold for $43,200 at an August 2020 Heritage auction.

By Jim O’Neal

When I was (much) younger, we thought it was great fun to call a liquor store and ask: “Do you have Sir Walter Raleigh in a can?” If the clerk said yes, we’d shout, “Well, you better let him out! His wife is looking for him!”

This would be followed by raucous laughter and cheering at our clever mischief. What I’m sure we didn’t know was that Sir Walter Raleigh had been beheaded on Oct. 29, 1618, and the severed head given to his wife. She had it embalmed and kept it in a red bag for 29 years until she died.

In a perverse way, our childish phone call may have been technically correct – that his wife had been looking for “the rest of him,” but it was just a much earlier time. Even today, there still exists a controversy over whether the head and body have ever been reunited. Coincidentally, I’ve discovered that Sir Walter Raleigh tobacco is still available (online) in cans or pouches.

Walter Raleigh, born in 1552, lived in an important time in England’s history. As a flamboyant soldier, explorer and would-be colonizer, he owed much of his success to the favor of Queen Elizabeth I (1533-1603). She was the daughter of Anne Boleyn, Queen of England from 1553 to 1536 and the second of King Henry VIII’s six wives. Their marriage ended abruptly when Anne was charged with treason, imprisoned in the Tower of London and subsequently beheaded. This was the start of the English Reformation when the Church of England revoked the authority of the Pope and the Roman Catholic Church.

Queen Elizabeth fared far better than her mother and ruled for 45 years. She found the tall, handsome Raleigh of great interest and granted him a cornucopia of titles, estates and monopolies as well as the sole patent to place settlers in America. In addition, working on behalf of the Crown, he led privateering expeditions against the Spanish and played a role in the colonization of Ireland, setting in motion the formation of an English Empire.

He was rewarded with a large estate in Ireland and knighthood in 1585. Within a few years, he became captain of the Queen’s Guard. Sir Walter Raleigh was an early supporter of colonizing North America and invested in an expedition across the Atlantic. This was the first attempt to found a permanent English settlement in the New World. It ended up off the coast of modern North Carolina and was known as the Virginia settlement (in honor of Queen Elizabeth, the “Virgin Queen”). Some of the colonists returned to England, bringing potatoes and tobacco, two things generally unknown in Europe.

A second voyage was sent in 1590, only to find no trace of the colony, other than the word CROATOAN on a piece of wood. It would become known as the “Lost Colony of Roanoke Island.” Although historians claim that tobacco was present in Europe before Raleigh’s time, he is often credited with popularizing it in England, despite never making a single trip to America. His association with tobacco has been enshrined by the Beatles on their acclaimed White Album. John Lennon derided him in the song “I’m So Tired,” with the lyrics, “Although I’m so tired, I’ll have another cigarette, And curse Sir Walter Raleigh, He was such a stupid get.”

Sadly, by the time the Jamestown Colony was established in Virginia in 1607, Walter Raleigh would be a prisoner in the Tower of London. His jealous enemies in the Court falsely accused him of participation in a bizarre plot to kidnap King James. Regardless, he was charged with treason and condemned to die (in the usual fashion). However, he somehow convinced the king that he could lead an expedition to the famed El Dorado and make the king the wealthiest man on earth.

It turned out to be a fiasco. But Raleigh honorably returned to England, where the treason charge was reimposed and he was again condemned to death. On Oct. 29, 1618, Raleigh, now 66 years old, coolly stepped up to the scaffold and asked the executioner to test his blade to ensure it “had a good edge.” Smiling, he said, “This is sharp medicine, but is it a physician for all diseases?”

The following century, the French Revolution provided a better answer to the issue of paying the executioner a bribe to have a good, sharp edge and be sure it was done with one accurate stroke. They developed a mechanical beheading machine. On Oct. 10, 1789, physician Joseph-Ignace Guillotin proposed to the National Academy that decapitation be done with “a simple mechanism.” During the Reign of Terror (1793-94), 17,000 people – including King Louis XVI and Queen Marie Antoinette – had a chance to evaluate this improvement, but the results are generally from people observing rather than actual users of this technique. Dr. Guillotine was not one the participants.

Eventually, the American cowboy made further improvements whenever there was a rustler or back-shooter that needed a taste of frontier justice. All that was required was a rope and a tall tree. A sharp whack on the buttocks of a sturdy horse was usually sufficient. My favorite Western movie … Red River, with John Wayne and Montgomery Clift (1948) … ends on the issue of hanging. For trivia buffs, if you ever watched the Peter Bogdanovich movie The Last Picture Show, you know it was Red River!

Intelligent Collector blogger JIM O’NEAL is an avid collector and history buff. He is president and CEO of Frito-Lay International [retired] and earlier served as chair and CEO of PepsiCo Restaurants International [KFC Pizza Hut and Taco Bell].

Madison is certainly the father of the Constitution

This 1809 James Madison commemorative Indian Peace Medal realized $24,000 at an August 2019 Heritage auction.

By Jim O’Neal

It is mildly amusing to listen to members of Congress refer to the Founding Fathers whenever they’re trying to validate a political point or opinion (“That’s exactly what the framers intended when they wrote the Constitution!”). They seem to believe that our Founders held a Constitutional Convention (partially true), quickly hammered out a list of sacred provisions and then had each state ratify them en masse. Naturally, the real story is much more complicated and Constitutional scholars of today still debate various aspects of what is meant. Even the Supreme Court struggles to gain a consensus on “original intent.”

After the 13 American colonies tired of monarchical rule under King George III and Parliament, they decided to form an independent country. A committee was formed to start the ball rolling with a Declaration of Independence. Thomas Jefferson was formally elected to write the document and years later (1822), John Adams wrote a letter to Timothy Pickering explaining how Jefferson was selected: “First, he had a reputation for literature, science and a talent of composition. Though silent in Congress, he was prompt, frank, explicit and decisive upon committee and in conversation. He seized my heart and I gave him my vote. When he asked my reasons, I said – You are a Virginian and I am obnoxious and unpopular. Lastly, you can write 10 times better than I can!”

Following the American Revolutionary War (1775-1783), the 13 original states ratified Articles of Confederation that served as the first Constitution. The primary principle of these articles was to preserve the sovereignty and independence of each individual state. A weak central government was formed, but great care was taken to ensure that it did not have any more power than previously assumed by the British King and Parliament. This issue of maintaining states’ rights would continue to perplex any efforts to federalize.

The states continued struggling under several different forms of Articles, Confederations and Conventions … all with loosely defined laws and regulations. Important issues like foreign policy, taxation, currency and basic commerce were hindered by competing state interests. Even the U.S. Army was under the direction of a Congress that was not well organized. These and other issues greatly worried the Founders, who believed the Union, as it existed in 1786, was in serious danger of breaking apart.

So it is true that we look to the Founding Fathers when we examine the great American experiment in democracy. But, the question remains: To whom did they turn for wisdom and guidance? Many found inspiration from Great Britain in the previous century, when the conflict between the King and Parliament escalated into a civil war. The generally Puritan Parliament simply moved to abolish the monarchy, executed Charles I in 1649 for treason and bravely established England’s first and only Republic. Oliver Cromwell became Lord Protector of England, Scotland and Wales. However, his death in 1658 created a power vacuum that was filled by Charles’ eldest son. So not much was really accomplished and they reverted back to a King + Parliament that ruled with deficiencies that continue to exist today.

Besides, it was now crystal clear that major changes were needed in America and, finally, a Constitutional Convention was scheduled for May-September 1787 in Philadelphia. It was described as an effort to revise the league of states and many state delegates arrived assuming the purpose was to debate and draft improvements. However, powerful voices were determined to forge a powerful new national government. Among this group were James Madison and Alexander Hamilton, who intended to create a new government rather than tinker with fixing the existing one.

After a long hot summer of debate, 39 of the original 55 delegates signed the new Constitution. It was released to the public to debate and gain state ratification. They immediately hit a snag over the absence of a Bill of Rights. There had been discussions among the delegates over the need for such a bill, but it was rejected by the Convention. The lack of a Bill of Rights became a rallying cry for the anti-federalists until advocates for the Constitution (led by James Madison) agreed to add one in the first session of Congress. Ratified on Dec. 15, 1791, the first 10 amendments – called the Bill of Rights – include sweeping restrictions on the federal government to protect rights and limit powers. Delaware was the first state to ratify the Constitution and the last was Rhode Island.

I am solidly in the camp of those who regard James Madison as Father of the U.S. Constitution. One does not need to look any further. No other delegate was better prepared for the Federal Convention of 1787 and no one contributed more in shaping the ideas of the document and explaining its meaning. He was a proponent for a consolidated, central republic to replace the loose and dysfunctional alliance under the Articles of Confederation. The Virginia Plan he brought to Philadelphia became the basis for the Convention agenda. His wish to clearly establish the sovereignty of the national government over the states has proven to be very durable. In 230 years, over 10,000 attempts have been made to amend it and as of now, only 27 have succeeded.

I rest my case.

Intelligent Collector blogger JIM O’NEAL is an avid collector and history buff. He is president and CEO of Frito-Lay International [retired] and earlier served as chair and CEO of PepsiCo Restaurants International [KFC Pizza Hut and Taco Bell].

Does America still have ‘the right stuff’ to continue this remarkable story?

This 1903 Louisiana Purchase Gold Dollar, Jefferson Design, minted to commemorate the centennial of the Louisiana Purchase, realized $37,600 at an April 2017 Heritage auction.

By Jim O’Neal

The 19th century in the United States was by any standard an unusually remarkable period. In 1800, John Adams was still president, but had lost his bid for re-election to Vice President Thomas Jefferson, the man behind the words in our precious Bill of Rights. Alexander Hamilton had used his personal New York influence to break a tie with Aaron Burr, since Jefferson was considered the least disliked of the two political enemies. (Burr would kill Hamilton in a duel in 1803 by cleverly escalating a disagreement into a matter of honor.)

There were 16 states in 1800 (Ohio would join the Union as no. 17) and the nation’s population had grown to 5.3 million. Within weeks of becoming president, Jefferson learned that Spain had receded a large portion of its North American territory to France. Napoleon now owned 530 million acres, more than what the United States controlled. Fearful that losing control of New Orleans to our new French neighbor would lead to losing control of the strategically important Mississippi River, he developed a plan without including Congress.

He dispatched Robert Livingston and James Monroe to buy greater New Orleans for $10 million. They were pleasantly surprised when the French offered to sell 100 percent of their North American territories for $15 million cash … less several million in pending claims. Concerned that the French would change their offer before they could get formal approval, an agreement in principle was agreed to (later formally approved by Congress after James Madison’s assurance of its constitutionality.)

What a prize! 828,000 square miles for 3 cents an acre, virtually doubling the size of the United States and gaining control of the mighty Mississippi and shipping into the Gulf of Mexico. With this uncertainty removed, cotton production now expanded rapidly south and soon represented over 50 percent of total exports. With the aid of the cotton gin and slave labor, the United States now controlled 70 percent of the world’s production. Ominously, seeds of a great civil war were planted with each cotton plant.

For millions of people overseas, conquest or riches were not their primary ambition. Escaping the clutches of famine trumped all other hardships of life. 1842 was the first year in America’s history that more than 100,000 immigrants arrived in a single year. Five years later, the number from Ireland alone exceeded this, with Irish coming to America to escape the scourge of the Great Famine. In the 1840s and ’50s, 20 percent of the entire population of Ireland crossed the Atlantic in search of a better life. In sharp contrast to the Pilgrims on the Mayflower – who were on a financial venture supplied with rations – the Catholic Irish left in rags to avoid starvation in a mainly Protestant nation.

Concurrently, another wave from the European mainland was fleeing revolution and counterrevolution. In Germany, half-a-million left in a three-year period (1852-55) as a spirit of revolt captured the European continent. “We are sleeping on a volcano,” warned Alexis de Tocqueville. Meanwhile, two German thinkers (Karl Marx and Friedrich Engels) penned their intellectual nonsense, The Communist Manifesto, from the safety and luxury of London.

In the United States, just before the impending boomlet of immigration in 1846, total railroad mileage was a meager 5,000 miles. Ten years later, it quintupled to 25,000 as the influx of labor to lay iron rails was a perfect match for $400 million in capital. As famine and revolution were destroying Europe, their foreign transplants were busy transforming their new homeland. Also, the transition of coal to steam to steamboats scampering around the newly dug connecting canals would inspire new communications like the telegraph and Pony Express. While the country had been busy absorbing the wave of immigrants, it had also been in the throes of a decades-long internal migration west.

Thomas Jefferson had predicted it would be 1,000 years before the frontier reached the Pacific Ocean. Only 23 years after his death in 1826, gold was discovered in California and the fever to get rich started a westward movement that expanded globally. Once under way, the richness of the soil and massive new resources of rivers, forests, fish and bison would expand the migration to include farmers and their families. Horace Greeley shouted, “Go West, young man” and they did.

With room to grow and prosper, by 1900 the population would expand by a factor of 15 times to 76 million. They resided in 45 states after the Utah territories joined the Union in 1896. Fulfilling the vision of Manifest Destiny (from sea to sea), the rural population of 95 percent evolved as urbanization grew to 40 percent as industrialization and worker immigrants staffed the factories and cities. A short war with Mexico added California, Arizona and New Mexico, and President Polk’s annexation of Texas in 1845 filled in the contiguous states.

However, it was the railroads that created the permanence. With 30,000 miles of track in 1860, America already surpassed every other nation in the world. The continual growth was phenomenal: 1870 (53k), 1880 (93k), 1890 (160k) and by 1900 almost 200,000 … a six-fold increase in a mere 40-year period. Yes, there were problems: Illinois had 11 time zones and Wisconsin 38, but this was harmonized by 1883. Most importantly, they connected virtually every city and town in America and employed 1 million people!

Throw in a few extras like electricity, oil wells, steel mills and voila! The greatest nation ever built from scratch. Today, we have 6 percent of the people on 6 percent of the land and 30 percent of the world’s economic activity … and we are celebrating the 50-year anniversary of putting a man on the moon.

Do we still have “the right stuff” to continue this remarkable story? I say definitely, if we demand that our leaders remember how we got here.

Intelligent Collector blogger JIM O’NEAL is an avid collector and history buff. He is president and CEO of Frito-Lay International [retired] and earlier served as chair and CEO of PepsiCo Restaurants International [KFC Pizza Hut and Taco Bell].

Solving a problem starts with understanding it

Bank of England notes printed on denominated watermarked paper, like this 1914 example, often appear at auction.

By Jim O’Neal

The venerable Bank of England, established in 1694, was known colloquially as “The Old Lady of Threadneedle Street.” This moniker derived from its address in Central London and the English propensity to “tut tut” anything considered disdainful. She took deposits, made loans and financed wars. None of the directors was a banker or even an economist. It was essentially merchant/businessmen who guarded the precious pound sterling, the lifeblood of the economy.

In August 1931, the bank issued an odd press release: “The governor of the Bank of England has been indisposed as a result of the exceptional strain to which he has been subjected in recent months. Acting on medical advice, he has abandoned all work and has gone abroad for rest and change.” That governor was Montagu Norman, the last of the four great Central Bankers (Britain, France, Germany and the United States) to still be alive. Governor Norman had a strange aversion to the press and was notorious for his clever ways to avoid them.

So it was a surprise when he openly explained his trip by ship to Canada: “I need a rest … suffered very difficult times … my health is poor, etc.” What he failed to mention was his incapacitation due to a nervous breakdown or that the world’s financial system was on the verge of collapse. This was especially true of the European banks, where he was revered as the world’s most powerful banker and, as he would later be forced to admit, he was unquestionably “the dictator of European currency,” a role he cherished to all others.

The bank’s press release had been received in Asia, the United States and, naturally, Europe and had further spooked anxious investors since this man was considered the thought leader of “the most exclusive club in the world” … Central Bankers. And 1931 was just the second year of what would become the unprecedented Great Depression that followed the collapse of the U.S. stock market on “Black Tuesday” in 1929. The effect on the United States can be explained by four simple indices from 1929-32: industrial production (46 percent), wholesale prices (32 percent), foreign trade (70 percent), and unemployment (607 percent!).

Supply-demand economists typically point to the event when a stock-market bubble bursts (as in the U.S.) and results in bank failures, bankruptcies and widespread economic devastation. Later monetarists led by Milton Friedman point to the contraction in money supply as a bigger culprit. Ex-Federal Reserve Chairman Ben Bernanke now agrees with Friedman and we’ve seen the results of quantitative easing during the 2008 Great Recession followed by 10 years of slow recovery.

I have a different perspective. The cause was pure greed. “Virtual casinos” inside banks were making big bets using customers’ money and outrageous leverage. A housing bubble combined with subprime lending was accompanied by exotic structured products like collateralized debt swaps, mortgage-backed securitization, and a slew of other complicated derivatives that nobody truly understood. They were approved by rating agencies and sold to unsuspecting investors (including other financial firms). Once the housing market collapsed, it exposed all the other high commission, risky products.

This difficult-to-understand situation was simplified by writer Michael Lewis in his book and movie The Big Short. My idea is to have him do something similar to our health-care system (which everybody agrees is terrible … like most of the ideas to fix it). I suspect it could all be cleaned up by having a truly transparent price-based system and eliminating an incomprehensible fee structure that lacks an outcome-based tracking system by hospital, doctor or other caregivers. It is too important to leave to Congress.

Mr. Lewis, I hope someone can get your attention … I am busy this week.

Intelligent Collector blogger JIM O’NEAL is an avid collector and history buff. He is president and CEO of Frito-Lay International [retired] and earlier served as chair and CEO of PepsiCo Restaurants International [KFC Pizza Hut and Taco Bell].

How does a prosperous continent mobilize for total war?

The U.S. Mint in 2013 issued its First Spouse gold coin commemorating Ellen Wilson.

By Jim O’Neal

In 1912, President William Howard Taft and ex-President Theodore Roosevelt managed to divide the Republican Party to the extent that (Thomas) Woodrow Wilson regained the White House for the Democrats. Even Socialist Eugene V. Debs snared nearly a million votes for his policy to replace America’s capitalist system with a socialized economic system. Wilson was the only Democratic Party president elected between 1892 and 1932.

Success in office came easily for Wilson. He was more effective with groups than one-on-one and he broke a tradition that extended back to Thomas Jefferson. He read his State of the Union to Congress rather than submitting a written report. Another change was to keep a sharp line between his public and personal life (a habit developed during his days in academia). Surprisingly, he did not believe in racial equality and some Cabinet organizations were totally racially segregated. His wife Ellen was different. Despite supporting the racial segregation that resulted from the appointment of Southern Senators, she was appalled by the slums that surrounded the White House and became an active crusader to clean up the densely populated, alley blight that was pervasive.

Her failing health was exacerbated when she tripped on a throw rug and fell. She was confined her to bed each day for four hours. In July 1914, she was diagnosed with tuberculosis of the kidneys – a form of Bright’s disease that proved fatal. She died on Aug. 6, 1914. In addition to being stricken with grief, Wilson was dismayed by what would become World War I, when Austria declared war on Serbia after an assassination. The president was grateful that the First Lady was never made aware that the world was crashing into ruin. “It would have broken her heart.”

As the world continued toward a catastrophic war, President Wilson buried himself in work and public appearances were scarce. Newspaper front pages were dominated by the war in Europe and there was a palpable hostility against imperial Germany, despite the president urging for moderation. A European land war did not appear to be a threat to the United States. Our oceans ensured our domestic security.

Occasional positive events punctuated the war clouds, which were growing darker. On Jan. 15, 1915, Wilson hosted a ceremony to inaugurate the first transcontinental telephone call from New York to San Francisco. Ten days later, Germany ominously announced the beginning of submarine warfare around the British Isles. Wilson rushed to mediate (another hopeless gesture), followed by a formal warning reminding Germany of the rights of neutrality for American ships. Sensing a deeper involvement, Secretary of State William Jennings Bryan protested the statement as Wilson remained steadfast.

Sixteen months after Ellen’s death, Wilson remarried and during this interlude the president continued to guide America over the hazardous shoals of neutrality. It was obvious that American involvement could tip the scales of war to either side, but the choice was to avoid war and treat it as rivalry between degenerate political systems. After the Germans sank the RMS Lusitania, the loss of life offended the sense of American justice and extensive war propaganda inflamed it further. The distant war seemed ever so closer.

In the fall of 1916, Wilson produced a message to the warring nations of Europe to lay down their arms, accept American mediation and work together to ensure peace and justice throughout the world. He considered it a masterpiece. “There are some sentences,” he wrote in his diary, “that will live as long as human history.” (Uh, maybe not).

When the United States entered the war, American armies propped up France and England when they were on the brink of collapse. The entire European financial system was crumbling sans U.S. credit.

When Wilson traveled to Paris to pursue his lofty goal of creating a just peace, America’s world prestige and power was at an all-time high. His idealistic 14-point plan was lauded around the world – promising democracy and self-determination for all. Wilson was arguably the most famous man alive. Had he merely presented his plan for a peace framework, his position would have been impregnable. He could have departed and ruled from the safety of the White House. Instead, he stayed and got ensnared by his sharp-elbowed allies, who proceeded to exploit his proximity and inculcate their tribal animosities. Most disastrous was his stubborn inability to compromise.

The ensuing meetings were little short of a disaster and he managed to alienate both his allies and the Germans. Upon his return, he was unable to get even his colleagues to support his plan for a League of Nations; he had a stroke and was unable to govern. It is still a mystery how little was accomplished and how much carnage was suffered. Worse was the planting of seeds guaranteeing a short reprieve followed by a resumption of hostilities.

But then, the First World War was a real mystery … its origins baffling, as were the events that followed. How is it possible for a prosperous continent – a symbol of wealth, global power, at the peak of intellectual and cultural achievement – opt to mobilize for total war, and in the process commit their future to pointless slaughter?

If reincarnated, their first question would likely be, What’s changed?

Intelligent Collector blogger JIM O’NEAL is an avid collector and history buff. He is president and CEO of Frito-Lay International [retired] and earlier served as chair and CEO of PepsiCo Restaurants International [KFC Pizza Hut and Taco Bell].

We owe Thomas Edison, Henry Ford a debt of gratitude

This uncanceled Edison Phonograph Works stock certificate is dated 1888, the very year the company was founded, and was issued to “Thomas A. Edison.” It was sold at an April 2012 Heritage auction.

By Jim O’Neal

On Monday, Oct. 21, 1929, the Edison Institute was dedicated in Dearborn, Mich. It was to commemorate the 50th anniversary of the first incandescent light bulb that Thomas Alva Edison had invented and the strong friendship between Henry Ford and Edison. Although it was a relatively small group that joined in, it was loaded with luminaries: John D. Rockefeller, Orville Wright, Will Rogers, Marie Curie and, of course, Henry Ford and Edison, who was 82 years old.

President Herbert Hoover’s speech stated: “Every American owes a debt to him. It is not alone a debt for great benefactions he has brought to mankind, but also a debt for the honor he has brought to our country. His life gives confidence … our institutions hold open the door of opportunity … to all that would enter.” The ceremony was broadcast on radio and listeners were asked to keep all their electric lights off until a switch was flipped at the event.

Thomas Edison

One week later, the stock market was in a state of chaos as a series of events led to the Great Depression.

Ford (1863-1947) had grown up on a rural farm in Michigan and, like virtually every other American, was captivated by the remarkable inventions Edison was cranking out. Eschewing farm work after his mother died, he inevitably went to work at his hero’s company – Edison Illuminating Company – as an engineer.

Ford rose through the ranks to Chief Engineer, which allowed him more personal time to work on developing his version of an automobile. In 1896, at age 33, Ford developed his first experimental car, called the Ford Quadricycle. Edison had been working on an electric car and when the two men finally met, Edison reputedly slammed his fist on a table and exclaimed, “Young man, you have it!” He encouraged Ford to continue his development and this started a longtime friendship between the two geniuses.

Ford eventually developed his Model T, a series of improvements (not inventions) to the combustion engine, and a continuous assembly line. Introduced in 1908, the Model T would be extremely successful, eventually becoming one of the top-selling cars of all time. With the steering wheel on the left side, it is estimated that over 75 percent of everyone who learned to drive did it in some version of the Model T.

Along the way, Ford pioneered the eight-hour workday, reduced the cost from $850 and raised worker wages to $5 a day so they could afford to buy a car. He became a rich and successful businessman with a passion for collecting historic objects. President Wilson convinced him to run for the Senate since he was for peace and a Democrat, but he lost. After his death in 1947, the Edison Institute was renamed the Henry Ford Museum.

Today, the Henry Ford Museum of American Innovation includes Greenfield Village, a tour of the massive Ford Rouge factory, and even a dedicated IMAX theater. The museum has an astonishing collection of Americana, with over 200 cars, JFK’s limousine from his trip to Dallas, the bus Rosa Parks made famous, Lincoln’s rocking chair from Ford’s Theater, Edison’s laboratory, the Wright Brothers’ bicycle machine shop, steam engines and other historic items depicting the history of America.

The Henry Ford Museum is the largest indoor/outdoor museum in the United States, with over 1.7 million visitors a year. Somewhere in this vast collection of truly famous objects is a small test tube with Edison’s last dying breath. Ford convinced Edison’s son to hold a mask over Edison as he was dying and capture/cork the “last breath.” Whether it does or not is irrelevant. The fact is that there are a number of similar test tubes that were filled in the room when Edison actually did die. The Ford example represents the genuine friendship between these two remarkable men and the wheelchair races on their adjoining estates in Florida, the hunting trips that included Harvey Firestone and President Harding, and their quest for knowledge that makes our lifestyle so much better even today.

They were both deeply flawed men who have slowly melted into history, but President Hoover was right. We do owe them a debt a gratitude and can overlook some or most of their egregious sins as the famous door of opportunity is still wide open, as we see every day.

Intelligent Collector blogger JIM O’NEAL is an avid collector and history buff. He is president and CEO of Frito-Lay International [retired] and earlier served as chair and CEO of PepsiCo Restaurants International [KFC Pizza Hut and Taco Bell].

Yes, Presidential Elections Have Consequences

Chief Justice of the Supreme Court John Marshall is featured on this Fr. 375 Serial Number One $20 1891 Treasury Note, which sold for $114,000 at an April 2018 Heritage auction.

By Jim O’Neal

In theory, there is no mystery or debate regarding the intention of the Founding Fathers in the selection of members to serve on the Supreme Court.

The Constitution crisply explains, in the second paragraph of Article II, Section 2, that the president shall nominate, and by and with the advice and consent of the Senate, shall appoint judges of the Supreme Court. This provision means exactly what it says and is unchanged by any modifications since its adoption. That includes a simple majority vote of the Senate to grant such consent, to reject or refuse to take action on the presidential nominee.

One idea discussed, but not acted upon, was Benjamin Franklin’s explanation of the Scottish mode of appointment “in which the nomination proceeded from the lawyers, who always selected the ablest of the profession in order to get rid of him, and share his practice among themselves” – a uniquely clever way to eliminate superior competition.

What has changed is the adoption of the “nuclear option” in 2017, which invoked cloture to end filibustering in the Judicial Committee and forced a vote of the committee either up or down on making their recommendation to the full Senate. House Majority Leader Harry Reid had used it to great effect for all legislation that he allowed to the floor while the Democrats were in the majority. Republicans expanded it to include Supreme Court nominees after they regained the majority in 2016. Neil Gorsuch was elected to the Supreme Court under this new rule with a 54-45 Senate vote, picking up three anxious Democrat votes in the process. It’s widely assumed that current nominee Judge Brent Kavanaugh will be elected to the Supreme Court following a similar path since his opponents appear helpless to stop him.

As President Obama once explained, in not too subtle fashion, “Elections have consequences.”

It now seems clear that the Founding Fathers did not foresee that political parties would gradually increase their influence and that partisan considerations of the Senate would become more prominent than experience, wisdom and merit. This was magnified in the current effort to stymie a nomination when the opposition announced they would oppose any candidate the Chief Executive chose. Period. It may not seem reasonable on a literal basis, but it has gradually become routine and will only get worse (if that’s still possible).

It may astonish some to learn that no legal or constitutional requirements for a federal judgeship exist. President Roosevelt appointed James F. Byrnes as an associate justice in 1941 and his admission to practice was by “reading law.” This is an obsolete custom now – Byrnes was the last to benefit – that proceeded modern institutions that specialize in law exclusively. In Byrnes’ case, it’s not clear that he even had a high school diploma. But he was a governor and member of Congress. He resigned 15 months later (the second shortest tenure) in order to become head of the Office of Economic Stabilization and was a trusted FDR advisor who many assumed would replace Vice President Henry Wallace as FDR’s running mate in 1944. That honor went to the little-known, high-school educated Harry Truman, who would assume the presidency the following year when FDR died suddenly.

Thomas Jefferson never dreamed the Supreme Court would become more than just a necessary evil to help balance the government in minor legal proceedings and would be more than astonished that they now are the final arbiter of what is or isn’t constitutional. The idea that six judges (who didn’t even have a dedicated building) would be considered equal to the president and Congress would have been anathema to him.

However, that was before he met ex-Secretary of State John Marshall when he became Chief Justice of the Supreme Court and started the court’s long journey to final arbiter of the Constitution when he ruled on Marbury v. Madison in 1803. There was a new sheriff in town and the next 40 years witnessed the transformation of the court to the pinnacle of legal power. They even have their own building thanks to President William Howard Taft, who died two years before it was complete. Someday, Netflix will persuade them to livestream their public discussions for all of us to watch, although I personally prefer C-SPAN to eliminate the mindless talking heads that pollute cable television.

Intelligent Collector blogger JIM O’NEAL is an avid collector and history buff. He is president and CEO of Frito-Lay International [retired] and earlier served as chair and CEO of PepsiCo Restaurants International [KFC Pizza Hut and Taco Bell].