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HomeUncategorizedhistory of the federal reserve

(Congressional Record, v. 51, pp. The branches were to be controlled by the member banks on a basis of their capitalization. When we find ... the same man a director in a half dozen or more banks and trust companies all located in the same section of the same city, doing the same class of business and with a like set of associates similarly situated all belonging to the same group and representing the same class of interests, all further pretense of competition is useless. The Dow Jones Industrial Average initially fell nearly 4% (465 points) at the start of trading and then rebounded to a 1.06% (128-point) loss. In response to the bursting of the 1990s stock market bubble in the early years of the decade, the Fed lowered interest rates rapidly. New York’s pro-posal was opposed by most of the other Federal Reserve banks, and so little was done. Although the National Banking Act of 1863 established some measure of currency stability for the growing nation, bank runs and financial panics continued to plague the economy. [11] Wilson appointed Bryan as his Secretary of State. [17] Even Aldrich stated strong opposition to the currency plan passed by the House.[18]. Due to a credit crunch caused by the subprime mortgage crisis in September 2007, the Federal Reserve began cutting the federal funds rate. The act marks the beginning of a period of modern banking industry reforms. The newly elected president, Woodrow Wilson, was committed to banking and currency reform, but it took a great deal of his political influence to get an acceptable plan passed as the Federal Reserve Act in 1913. The Federal Reserve", "A Brief History of Central Banking in the United States", "The Panic of 1907 and Some of Its Lessons", "Paul Warburg's Crusade to Establish a Central Bank in the United States", "America's Unknown Enemy: Beyond Conspiracy", "Frank Vanderlip And The Creation Of The Federal Reserve", "Born of a panic: Forming the Federal Reserve System", "U.S. Congress, Excerpts from the Report of the Committee Appointed to Investigate the Concentration of Money and Credit, House Report No. Under the leadership of Senator Nelson Aldrich, the commission developed a banker-controlled plan. I do not feel it is any exaggeration to speak of our secret expedition to Jekyl Island as the occasion of the actual conception of what eventually became the Federal Reserve System. President Woodrow Wilson signed the Federal Reserve Act into law on December 23, 1913. (Washington, D.C., 1913), III: pp. The effectiveness of the Federal Reserve as a central bank was put to the test on September 11, 2001 as the terrorist attacks on New York, Washington and Pennsylvania disrupted U.S. financial markets. I have alleged that there is a 'Money Trust'", said Lindbergh. The group, led by Representative Robert Henry of Texas, demanded that the "Money Trust" be destroyed before it could undertake major currency reforms. The Fed cut rates by 0.25% after its December 11, 2007, meeting, disappointing many investors who had expected a bigger cut; the Dow Jones Industrial Average dropped nearly 300 points that day. The Aldrich-Vreeland Act of 1908, passed as an immediate response to the panic of 1907, provided for emergency currency issue during crises. The Act was totally revised in 1864 and later named as the National-Bank Act, or National Banking Act, as it is popularly known. The opponents particularly objected to the idea of regional banks having to operate without the implicit government protections that large, so-called money-center banks would enjoy. [4] The following year, Congress enacted the Aldrich–Vreeland Act which provided for an emergency currency and established the National Monetary Commission to study banking and currency reform. American history. As there was little in the way of deposit insurance, if a bank was rumored to be having liquidity problems then this might cause many people to remove their funds from the bank. One early episode showing monetary policy-makers’ pessimism about what they could accomplish occurred in the summer of 1930, when the Federal Reserve Bank of New York proposed expansionary actions. In October 1929, his predictions seemed to be realized when the stock market crashed, and the nation fell into the worst depression in its history. Federal Reserve Notes, also United States banknotes, are the banknotes currently used in the United States of America.Denominated in United States dollars, Federal Reserve Notes are printed by the United States Bureau of Engraving and Printing on paper made by Crane & Co. of Dalton, Massachusetts.Federal Reserve Notes are the only type of U.S. banknote currently produced. You may redistribute it, verbatim or modified, providing that you comply with the terms of the CC-BY-SA. The Federal Reserve System is a deliberately confusing mishmash of public and private interests, reserve banks, boards and committees, centralized in Washington and spread out across the United States. Most Republicans (and the Wall Street bankers) favored the Aldrich Plan that came out of Jekyll Island. From December 1912 to December 1913, the Glass-Willis proposal was hotly debated, molded and reshaped. Before 1980, interest rates were used as guidelines; inflation was severe. The New York Times called the Act the "Oklahoma idea, the Nebraska idea" – referring to Owen and Bryan's involvement.[11]. The President felt that it was his duty to protect patriotic citizens by not lowering the value of the bonds that they had purchased during the war. Glass denied copying Aldrich's plan. Throughout most of 1912, Glass and Willis labored over a central bank proposal, and by December 1912, they presented Wilson with what would become, with some modifications, the Federal Reserve Act. Strong’s aggressive action to stem a recession in 1923 through a large purchase of government securities gave clear evidence of the power of open market operations to influence the availability of credit in the banking system. Former Congressional Candidate, 6th District N.J. "I place economy among the first and most important virtues, and public debt as the greatest of dangers. The Federal Reserve System formally committed to maintaining a low interest rate peg on government bonds in 1942 after the United States entered World War II. The Federal Reserve: History of Lies, Thievery, and Deceit. By this time, most Americans were calling for reform of the banking system, but the structure of that reform was cause for deep division among the country’s citizens. Because of the crescendo effect of banks which lent more than their assets could cover, during the last quarter of the 19th century and the beginning of the 20th century, the United States economy went through a series of financial panics. In 2003, the Federal Reserve changed its discount window operations so as to have rates at the window set above the prevailing Fed Funds rate and provide rationing of loans to banks through interest rates. [25] However, the 1914 report of the Federal Reserve Organization Committee, which clearly laid out the rationale for their decisions on establishing Reserve Bank districts in 1914, showed that it was based almost entirely upon current correspondent banking relationships. 2 Andrew Jackson, "Veto Message, Washington, July 10, 1832," in Richardson, ed., Messages and Papers of the Presidents, II, 576–591. Conservatives and powerful “money trusts” in the big eastern cities were vehemently opposed by “progressives.” But there was a growing consensus among all Americans that a central banking authority was needed to ensure a healthy banking system and provide for an elastic currency. Federal Open Market Committee 3. The reluctance of the Federal Reserve to continue monetizing the deficit became so great that, in 1951, President Truman invited the entire Federal Open Market Committee to the White House to resolve their differences. [35], Key laws affecting the Federal Reserve have been:[36], Central banking prior to the Federal Reserve, The National Monetary Commission, 1907-1913, Enactment of the Federal Reserve Act (1913), Accord of 1951 between the Federal Reserve and the Treasury Department. It did so at the request of the Treasury to allow the federal government to engage in cheaper debt financing of the war. The 1912 election of Democrat Woodrow Wilson killed the Republican Aldrich plan, but the stage was set for the emergence of a decentralized central bank. Before the new central bank could begin operations, the Reserve Bank Operating Committee, comprised of Treasury Secretary William McAdoo, Secretary of Agriculture David Houston, and Comptroller of the Currency John Skelton Williams, had the arduous task of building a working institution around the bare bones of the new law. "The Aldrich plan is a scheme plainly in the interest of the Trust". The housing boom got a boost from increased securitization of mortgages—a process in which mortgages were bundled together into securities that were traded in financial markets. Known as "continentals," the fiat money notes were issued in such quantity they led to inflation, which, though mild at first, rapidly accelerated as the war progressed. Some people think the Federal Reserve Banks are U.S. Government institutions. Board of Governors 2. The Association would also carry a portion of member banks' reserves, determine discount reserves, buy and sell on the open market, and hold the deposits of the federal government. Discovery, we knew, simply must not happen, or else all our time and effort would be wasted. It continued to support government borrowing after the war ended, despite the fact that the Consumer Price Index rose 14% in 1947 and 8% in 1948, and the economy was in recession. You could have struck a full blow and you would have won. Sen. Robert L. Owen of Oklahoma eventually relented to speak in favor of the bill, arguing that the nation's currency was already under too much control by New York elites, whom he alleged had singlehandedly conspired to cause the 1907 Panic. The Boston Fed, along with the other 11 Federal Reserve Banks nationwide and the Board of Governors in Washington, D.C., make up our nation's central bank. J.P. Morgan was again called upon to avert disaster. During the 1912 election, the Democratic Party took control of the presidency and both chambers of Congress. The FOMC, the FED’s highest decision-making body, is made up of 12 regional central bank presidents and … The Federal Reserve System is the third central banking system in United States history. History of The Federal Reserve is a clip from the Zeitgeist Movie. But the greater impact in the United States came from the Reserve Banks’ ability to discount bankers acceptances. (In later years, to stimulate short-term economic activity, Congress would amend the act to allow more discretion in the amount of gold that must be redeemed by the Bank. The Fed played the pivotal role in dampening the effects of the September 11 attacks on U.S. financial markets. [34] In October 2013, he nominated Janet Yellen to succeed Bernanke. Agencies provide temporary relief to community banking organizations Press Release - … In fact, two central banks existed prior to the Federal Reserve: The First Bank of … Volcker was chairman until August 1987, whereupon Alan Greenspan assumed the mantle, seven months after monetary aggregate policy had changed.[30]. The Federal Reserve central bank is a multi-layered financial body, deriving its authority and spirit from the Federal Reserve Law of 1913. But once the nation entered World War I, the Fed quickly became a major player by supporting the U.S. Treasury’s war bond effort and offering lower interest rates to member banks when the proceeds were used to buy bonds. On June 25, 2003, the federal funds rate was lowered to 1.00%, its lowest nominal rate since July 1958, when the overnight rate averaged 0.68%. A BRIEF HISTORY OF THE FEDERAL RESERVE Patrick J. Herbert, Contributor for Waking Times “We have in this country one of the most corrupt institutions the world has ever known. If it were to be exposed publicly that our particular group had gotten together and written a banking bill, that bill would have no chance whatever of passage by Congress. The plan provided for one great central bank, the National Reserve Association, with a capital of at least $100 million and with 15 branches in various sections. Financial network structure is an important determinant of systemic risk. Established by the Federal Reserve Act of 1913, the Fed is actually the third (and longest-running) central bank in United States history. Warburg would later write that "The matter of a uniform discount rate (interest rate) was discussed and settled at Jekyll Island." Despite being an executive agency, the financial body is largely independent of the control of the President or Congress and is described as being “independent within the Government.” The Federal Reserve’s four main axes of power include the following: 1. The committee set up offices in the then-45 states and distributed printed materials about the proposed central bank. [This article is part of the Understanding Money Mechanics series, by Robert P. Murphy. [29], In January 1987, with retail inflation at only 1%, the Federal Reserve announced it was no longer going to use money-supply aggregates, such as M2, as guidelines for controlling inflation, even though this method had been in use from 1979, apparently with great success. History of Federal Reserve Act History N MONDAY, October 21, 1907, the Na­ tional Bank of Commerce of New York City announced its refusal to clear for the Knickerbocker Trust Company of the same city. by Dr. Ken Matto. Both banks issued currency, made commercial loans, accepted deposits, purchased securities, maintained multiple branches and acted as fiscal agents for the U.S. A Monetary Chronology of the United States. It was clear that the nation’s banking and financial system needed serious attention. Many agrarian minded Americans uncomfortable with the idea of a large and powerful bank opposed it. Barriers to insurance activities, however, proved more difficult to circumvent. At the same time, the inability of the country to reduce or eliminate the impact of wide gyrations in the economy – booms and busts – with accompanying financial panics and economic depressions persuaded most Americans that a change in the country’s banking system was necessary. The Monetary Control Act of 1980 required the Fed to price its financial services competitively against private sector providers and to establish reserve requirements for all eligible financial institutions. During the Civil War, the National Banking Act of 1863 was passed, providing for nationally chartered banks, whose circulating notes had to be backed by U.S. government securities. Federal Reserve Board announces termination of enforcement action Press Release - 11/24/2020 . Conflict between the Treasury and the Fed came to the fore when the Treasury directed the central bank to maintain the peg after the start of the Korean War in 1950. He [your enemy] will not cease fighting ... at some half-baked enactment ... You struck a weak half-blow, and time will show that you have lost. The system is composed of a central, independent governmental agency--the Board of Governors--in Washington, D.C., and 12 regional Federal Reserve Banks, located in major cities throughout the nation.. Today, the Federal Reserve sets the nation's … )[6] Critics of the time (later joined by economist Milton Friedman) suggested that Glass's legislation was almost entirely based on the Aldrich Plan that had been derided as giving too much power to elite bankers. The 1970s saw inflation skyrocket as producer and consumer prices rose, oil prices soared and the federal deficit more than doubled. Centralized banking was met with much opposition from politicians, who were suspicious of a central bank and who charged that Aldrich was biased due to his close ties to wealthy bankers such as J.P. Morgan and his daughter's marriage to John D. Rockefeller, Jr.[5], In 1910, Aldrich and executives representing the banks of J.P. Morgan, Rockefeller, and Kuhn, Loeb & Co., secluded themselves for ten days at Jekyll Island, Georgia. Starting at the end of June 2004, the Federal Reserve System raised the target interest rate then continued to do so 17 more times. ...[11], Seen as a "Money Trust" plan, the Aldrich Plan was opposed by the Democratic Party as was stated in its 1912 campaign platform, but the platform also supported a revision of banking laws intended to protect the public from financial panics and "the domination of what is known as the "Money Trust." The Federal Reserve System, created with the enactment of the Federal Reserve Act on December 23, 1913, is the central banking system of the United States. (Congressional Record, v. 51, page 1447, Dec. 22, 1913). In response, Rep. Arsène Pujo, a Democrat from Louisiana, obtained congressional authorization to form and chair a subcommittee (the Pujo Committee) within the House Committee Banking Committee, to conduct investigative hearings on the alleged "Money Trust". The trust company had deposits amounting to $62,000,000. Directed by James Corbett. Allan H. Meltzer's monumental history of the Federal Reserve System tells the story of one of America's most influential but least understood public institutions. [11] However, Bryan soon became disillusioned with the system. Test your knowledge about Federal Reserve history through this quiz. With Andrew Gavin Marshall, Michel Chossudovsky, G. Edward Griffin. Also, as part of the massive reforms taking place, Roosevelt recalled all gold and silver certificates, effectively ending the gold and any other metallic standard. In July 1979, President Jimmy Carter nominated Paul Volcker as Chairman of the Federal Reserve Board amid roaring inflation. By August 1979, when Paul Volcker was sworn in as Fed chairman, drastic action was needed to break inflation’s stranglehold on the U.S. economy. An earlier version of the bill had passed the Senate 54 to 34,[16] but almost 30 senators had left for Christmas vacation by the time the final bill came to a vote. The series will be published as a book in late 2020.] The related liquidity problem was largely caused by an immobile, pyramidal reserve system, in which nationally chartered rural/agriculture-based banks were required to set aside their reserves in federal reserve city banks, which in turn were required to have reserves in central city banks. "[20], Wilson named Warburg and other prominent experts to direct the new system, which began operations in 1915 and played a major role in financing the Allied and American war efforts. [9], Aldrich fought for a private monopoly with little government influence, but conceded that the government should be represented on the board of directors. [1] The U.S. Federal Government was required to purchase 20% of the bank capital stock shares and to appoint 20% of the board members (directors) of each of those first two banks "of the United States." To finance the American Revolution, the Continental Congress printed the new nation's first paper money. ", Southerners and westerners learned from Wilson that the system was decentralized into 12 districts and surely would weaken New York and strengthen the hinterlands. When World War I broke out in mid-1914, U.S. banks continued to operate normally, thanks to the emergency currency issued under the Aldrich-Vreeland Act of 1908. The group almost succeeded in killing the bill, but were mollified by Wilson's promises to propose antitrust legislation after the bill had passed, and by Bryan's support of the bill.[11]. This article examines how the U.S. interbank network evolved over a long and important period that included two key events: the founding of the Federal Reserve and the Great Depression. [20] Bryan and the agrarians wanted a government-owned central bank which could print paper money whenever Congress wanted, and thought the plan gave bankers too much power to print the government's currency. Jackson staked the legislative success of his second presidential term on the issue of central banking. By 1816, the political climate was once again inclined toward the idea of a central bank; by a narrow margin, Congress agreed to charter the Second Bank of the United States. The next day, following a run of He was the only appointee asked to appear before the Senate, whose members questioned him about his interests in the central bank and his ties to Kuhn, Loeb, & Co.'s "money trusts".[5]. When Wilson signed the Federal Reserve Act on December 23, 1913, he said he felt grateful for having had a part "in completing a work ... of lasting benefit for the country,"[22] knowing that it took a great deal of compromise and expenditure of his own political capital to get it enacted. During the 1920s, Virginia Representative Carter Glass warned that stock market speculation would lead to dire consequences. To finance the American Revolution, the Continental Congress printed the new nation's first paper money. Volcker tightened the money supply, and by 1986 inflation had fallen sharply. The Federal Reserve Banks are the agents of the foreign central banks. all rights reserved. Wilson convinced them that because Federal Reserve notes were obligations of the government and because the president would appoint the members of the Federal Reserve Board, the plan fit their demands. Treasury. In 1956 the Bank Holding Company Act named the Fed as the regulator of bank holding companies owning more than one bank, and in 1978 the Humphrey-Hawkins Act required the Fed chairman to report to Congress twice annually on monetary policy goals and objectives. The Money Trust has not passed [died] ... You rejected the specific remedies of the Pujo committee, chief among them, the prohibition of interlocking directorates. Following World War I, Benjamin Strong, head of the New York Fed from 1914 to his death in 1928, recognized that gold no longer served as the central factor in controlling credit. This article is about the history of the United States Federal Reserve System from its creation to the present. The bill passed the House by an overwhelming majority of 298 to 60 on December Next: History and Responsibilities of the Fed » This site is a product of the Federal Reserve. We were trying to plan a mechanism that would correct the weaknesses of our banking system as revealed under the strains and pressures of the panic of 1907. National bank currency was considered inelastic because it was based on the fluctuating value of U.S. Treasury bonds. [10] The National Board of Trade appointed Warburg as head of a committee to persuade Americans to support the plan. 1593, 3 vols. The National Reserve Association would issue currency, based on gold and commercial paper, that would be the liability of the bank and not of the government. During the planting seasons, rural banks would exploit their reserves to finance full plantings, and during the harvest seasons they would use profits from loan interest payments to restore and grow their reserves. William McChesney Martin, then Assistant Secretary of the Treasury, was the principal mediator. Through this mechanism, the United States aided the flow of trade goods to Europe, indirectly helping to finance the war until 1917, when the United States officially declared war on Germany and financing our own war effort became paramount. After a fierce debate between the Fed and the Treasury for control over interest rates and U.S. monetary policy, their dispute was settled resulting in an agreement known as the Treasury-Fed Accord. The Office, which still exists today, examines and supervises all banks chartered nationally and is a part of the U.S. Treasury Department. [10], Because the bill was introduced by Aldrich, who was considered[by whom?] Other member ban… In 1863, as a means to help finance the Civil War, a system of national banks was instituted by the National Currency Act. This was in keeping with the general plan of action he made in his First Inaugural Address on March 4, 1913, in which he stated: We shall deal with our economic system as it is and as it may be modified, not as it might be if we had a clean sheet of paper to write upon; and step-by-step we shall make it what it should be, in the spirit of those who question their own wisdom and seek counsel and knowledge, not shallow self-satisfaction or the excitement of excursions we can not tell. Republican Sen. Robert M. La Follette and Rep. Charles Lindbergh Sr. both spoke out against the favoritism that they contended the bill granted to Wall Street. Despite my views about the value to society of greater publicity for the affairs of corporations, there was an occasion, near the close of 1910, when I was as secretive, indeed, as furtive as any conspirator. 1443–44, Dec. 22, 1913). In reaction to the Great Depression, Congress passed the Banking Act of 1933, better known as the Glass-Steagall Act, calling for the separation of commercial and investment banking and requiring use of government securities as collateral for Federal Reserve notes. [6], Large bankers thought the legislation gave the government too much control over markets and private business dealings. Progressive Democrats demanded a reserve system and currency supply owned and controlled by the Government in order to counter the "money trust" and destroy the existing concentration of credit resources in Wall Street. It had to survive the distrust of its own blood parents and its structure reflects that distrust. In 1922, he told Congress, "no greater misconception was ever projected in this Senate Chamber. Test your knowledge about Federal Reserve history through this quiz.Additional quizzes are also available.. 1775-1791: U.S. Currency. Popularly known as the Federal Reserve or simply the Fed, the Federal Reserve System was created in the belief that centralized, regulated control of the nation’s monetary system would help alleviate or prevent financial crises like … [6] There, Paul Warburg of Kuhn, Loeb, & Co. directed the proceedings and wrote the primary features of what would be called the Aldrich Plan. Independent of audits, independent of congressional supervision, and independent of the American voter. No group got exactly what it wanted. Eccles's memoir, Beckoning Frontiers, presents a detailed eyewitness account of this meeting and surrounding events, including verbatim transcripts of pertinent documents. But the Aldrich plan more nearly represented the compromise position between the two Democrat extremes, and it was closest to the final legislation passed. In November 2002, rates were cut to 1.75%, and many rates went below the inflation rate. Vanderlip wrote in his 1935 autobiography From Farmboy to Financier:[7]. Although the Aldrich Federal Reserve Plan was defeated when it bore the name Aldrich, nevertheless its essential points were all contained in the plan that was finally adopted. [10] Wilson thought the Aldrich plan was perhaps "60–70% correct". The discount window is available to meet liquidity needs.” In the days that followed, the Fed lowered interest rates and loaned more than $45 billion to financial institutions in order to provide stability to the U.S. economy. [28] In October 1979 the Federal Reserve announced a policy of "targeting" money aggregates and bank reserves in its struggle with double-digit inflation. [23], While a system of 12 regional banks was designed so as not to give eastern bankers too much influence over the new bank, in practice, the Federal Reserve Bank of New York became "first among equals". The hearings continued for a full year and were led by the subcommittee's counsel, Democratic lawyer Samuel Untermyer, who later also assisted in drafting the Federal Reserve Act. These people are very independent. [5] The Nebraskan populist and frequent Democratic presidential candidate William Jennings Bryan said of the plan: "Big financiers are back of the Aldrich currency scheme." I am glad to see that there finally some calls for the Fed to be audited because it seems to me that the Fed is a criminal enterprise. But when Andrew Jackson, a central bank foe, was elected president in 1828, he vowed to kill it. By December 23, 1913, when President Woodrow Wilson signed the Federal Reserve Act into law, it stood as a classic example of compromise—a decentralized central bank that balanced the competing interests of private banks and populist sentiment. Aldrich set up two commissions – one to study the American monetary system in depth and the other, headed by Aldrich, to study the European central-banking systems and report on them. Three weeks later, he was named Chairman of the Federal Reserve, replacing McCabe. State-chartered banks and unchartered “free banks” took hold during this period, issuing their own notes, redeemable in gold or specie. Allan H. Meltzer’s critically acclaimed history of the Federal Reserve is the most ambitious, most intensive, and most revealing investigation of the subject ever conducted. Amazing book This is a very detailed account of the Federal Reserve’s birth and how our money really works here in the United States. On January 30, 2008, eight days after the 0.75% decrease, the Fed lowered its rate again, this time by 0.50%.[33]. This article is about the history of the United States Federal Reserve System from its creation to the present. [11], After Wilson presented the bill to Congress, a group of Democratic congressmen revolted. William Jennings Bryan and other progressives fiercely attacked the plan; they wanted a central bank under public, not banker, control. His attack on its banker-controlled power touched a popular nerve with Americans, and when the Second Bank’s charter expired in 1836, it was not renewed. The Federal Reserve: The Third Central Bank of the U.S. The Federal Reserve System, initially created to address these banking panics, is now charged with several broader responsibilities, including fostering a sound banking system and a healthy economy. [15] Wilson sought the advice of prominent lawyer Louis Brandeis to make the plan more amenable to the agrarian wing of the party; Brandeis agreed with Bryan. Despite taxation on their notes, state banks continued to flourish due to the growing popularity of demand deposits, which had taken hold during the Free Banking Era. The Federal Reserve claims that nobody owns it – that it is an "independent entity within the government." The branches and businessmen of each of the 15 districts would elect thirty out of the 39 members of the board of directors of the National Reserve Association. Twelve regional Federal Reserve banks, and 4. [2] Jackson's second term in office ended in March 1837 without the Second Bank of the United States's charter being renewed. The First Bank of the United States (1791–1811) and the Second Bank of the United States (1817–1836) each had a 20-year charter. But, by November 16, 1914, the 12 cities chosen as sites for regional Reserve Banks were open for business, just as hostilities in Europe erupted into World War I. In March 2006, the Federal Reserve ceased to make public M3, because the costs of collecting this data outweighed the benefits. [24] Democratic Congressman Carter Glass sponsored and wrote the eventual legislation,[10] and his home state capital of Richmond, Virginia, was made a district headquarters.

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