Creature From Jekyll Island by G. Edward

CONGRESS

The second attempt to pass legislation to legalize

the banking cartel; the bankers' selection of

Woodrow Wilson as a Presidential candidate;

their strategy to get him elected; the role played by Wilson to promote the cartel's legislation; the

final passage of the Federal Reserve Act.

The election of 1912 was a textbook example of power politics and voter deception. The Republican President, William Howard Taft, was up for reelection. Like most Republicans of that era, his political power was based upon the support of big-business and banking interests in the industrial regions. He had been elected to his first term in the expectation that he would continue the protectionist policies of his predecessor, Teddy Roosevelt, particularly in the expansion of cartel markets for sugar, coffee, and fruit from Latin America. Once in office, however, he grew more restrained in these measures and earned the animosity of many powerful Republicans. The ultimate breach occurred when Taft refused to support the Aldrich Plan. He objected, not because it would create a central bank which would impose government control over the economy, but because it would not offer enough government control. He recognized that the Jekyll Island formula would place the bankers into the driver's seat with only nominal participation by the government. He did not object to the ancient partnership between monetary and political scientists, he merely wanted a greater share for the political side. The bankers were not adverse to negotiating the balance of power nor were they unwilling to make compromises, but what they really needed at this juncture was a man in the White House who, instead of being 452

THE CREATURE FROM JEKYLL ISLAND

lukewarm on the plan, could be counted on to become its champion and who would use his influence as President to garner support from the fence straddlers in Congress. From that moment forward, Taft was marked for political extinction.

This was a period of general prosperity, and Taft was popular with the voters as well as with the rank-and-file Party organization.

He had easily won the nomination at the Republican convention, and there was little doubt that he could take the presidential election as well. Wilson had been put forth as the Democratic challenger, but his dry personality and aloof mannerisms had failed to arouse sufficient voter interest to make him a serious contender.

THE BULL MOOSE CANDIDATE

However, when Teddy Roosevelt returned from his latest African safari, he was persuaded by Morgan's deputies, George Perkins and Frank Munsey, to challenge the President for the Party's nomination. When that effort failed, he was then persuaded to run against Taft as the 'Bull Moose' candidate on the Progressive Party ticket. It is unclear what motivated him to accept such a proposition, but there is no doubt regarding the intent of his backers. They did not expect Roosevelt to win, but, as a former Republican President, they knew he would split the Party and, by pulling away votes from Taft, put Wilson into the White House.

Presidential campaigns need money and lots of it. The Republican Party was well financed, largely from the same individuals who now wanted to see the defeat of its own candidate. It would not be possible to cut off this funding without causing too many questions. The solution, therefore, was to provide the financial resources for all three candidates, with special attention to the needs of Wilson and Roosevelt.

Some historians, while admitting the facts, have scoffed at foe conclusion that deception was intended. Ron Chernow says: 'By 1924, the House of Morgan was so influential in American politics that conspiracy buffs couldn't tell which presidential candidate was more beholden to the bank.'1 But one does not have to be a conspiracy buff to recognize the evidence of foul play. Ferdinand Lundberg tells us:

1. Chernow, p. 254.

THE CREATURE SWALLOWS CONGRESS 453

J.P. Morgan and Company played the leading role in the national election of 1912.... Roosevelt's preconvention backers were George W.

Perkins and Frank Munsey. These two, indeed, encouraged Roosevelt to contest Taft's nomination Munsey functioned in the newspaper field for J.P. Morgan and Company—buying, selling, creating, and suppressing newspapers in consonance with J.P. Morgan's shifting needs.... Perkins resigned from J.P. Morgan and Company on January 1,1911, to assume a larger political role....

The suspicion seems justified that the two were not over-anxious to have Roosevelt win. The notion that Perkins and Munsey may have wanted Wilson to win ... is partly substantiated by the view that Perkins put a good