by Alice Echols
57. Particularly in the West, hostility to government—or certain kinds of government authority—did not originate with these taxpayer associations, but rather has a long history. However, these taxpayer associations have not been studied nearly enough, even though one can draw a line from them through to antitax initiatives later in the twentieth century. Conservative activist Grover Norquist helped to popularize the phrase “starve the beast.” Norquist, a libertarian, has been instrumental in orienting the Republican Party toward a position hostile to big government. He was the author of the Taxpayer Protection Pledge, which has enjoyed overwhelming support from Republicans. He has said, “I’m not in favor of abolishing the government. I simply want to reduce it to the size where I can drag it into the bathroom and drown it in the bathtub.” Norquist quoted in Monika Bauerlein and Clara Jeffrey, “The Job Killer,” Mother Jones, November/December 2011. This view was restated by Rand Paul, who in February 2015 said, “We need to shut the damn thing down.” Paul quoted in Peter Wehner, “Government Is Not the Enemy,” NYT, March 1, 2015.
58. “City Fights Budget Bill,” CSG, February 21, 1933, 1.
59. “Officials Rotten,” CSG, March 30, 1933, 3. For more on Little, see “Little to Go on Bench Tomorrow,” SGT, December 18, 1938, 1.
60. Take the example of the Community Chest of Colorado Springs, which like municipalities elsewhere pushed a plan for repatriating Mexicans. The town’s charitable organization identified seventy-five local Mexican families that it deemed lucky enough to be “qualified to return” to Mexico, no matter what the families in question wanted. “75 Mexican Families Here Qualified to Return to Mexico,” CSG, May 27, 1932. And in 1936, Colorado governor Ed Johnson established a blockade to keep Mexicans out of the state.
61. Lorena Hickok, One Third of a Nation: Lorena Hickok Reports on the Great Depression, ed. Richard Lowitt and Maurine Beasley (Urbana: University of Illinois Press, 1981), 243.
62. These groups are thought to have faded by the mid-thirties, but see “New Yorkers Set for Tax Rebellion,” CSG, January 24, 1940, 1.
63. Bieto, Taxpayers in Revolt, xii.
64. The press was filled with denunciations of the New Deal, such as “New Deal Soaking Poor, Says Knox,” CSG, October 1, 1936, 1. Locally, Little also attacked taxes, but in 1933 he was on record praising FDR. See “Officials Rotten.”
65. “Rift Not Healed in Taxpayers’ Bodies,” CSG, February 21, 1933, 1; “Seek Special City Election,” CSG, April 1, 1934, 1.
66. Robert G. Athearn is referring specifically to the New Deal years, but this attitude predates the Depression years. See Mythic West, 103.
67. This paragraph draws upon Albert Hurtado’s “Whose Misfortune? Richard White’s Ambivalent Region,” Reviews in American History 22 (June 1994): 286–91.
68. Phillips-Fein, Invisible Hands, 118–19.
69. “Merrill Shoup,” CSGT, July 16, 1964, 1.
70. Lassiter, The Silent Majority, 198.
71. Kuttner, Revolt of the Haves.
72. “Required Reading; Government One,” NYT, January 27, 1983. Today, Americans’ hostility to government dwarfs what it was during the Depression. Some analysts point to race as the key reason for this shift. During the thirties New Deal reforms routinely excluded people of color and targeted whites as beneficiaries, thereby blunting the public’s objections to big government. A case in point: the Federal Housing Administration (FHA) insured homeowners’ loans, making this linchpin of the American dream widely available to white Americans. However, the FHA routinely rejected the applications of minority homeowners on the grounds that they lived in neighborhoods too risky to refinance or were poor credit risks. Simply put, white Americans were less likely to object to a welfare state when they (or those who resembled them) were its beneficiaries. On a related issue, many people argue that the HOLC discriminated against minorities, but Adam Gordon argues that although the HOLC maps created the template for redlining, its own lending was not racially discriminatory. It was, he argues, the FHA who took those maps and ran with them. See Gordon, “The Creation of Homeownership: How New Deal Changes in Banking Regulation Simultaneously Made Homeownership Accessible to Whites and Out of Reach for Blacks,” Yale Law Journal 115, no. 1 (October 2005).
73. “Can Walter Davis Avoid Extradition,” CSG&T, October 16, 1932, Sec 2, 1.
74. “Chief Harper Is the President of the International Association,” CSG, June 16, 1932, 1.
6: The Port of Missing Men
1. Richard H. Pells, Radical Visions and American Dreams: Culture and Social Thought in the Depression Years (New York: Harper Collins, 1974), 78.
2. McElvaine, The Great Depression, 137; Alan Dawley, Struggles for Justice: Social Responsibility and the Liberal State (Cambridge, MA: Harvard University Press, 1991), 348. In his film American Madness, Frank Capra succeeded in capturing the terrifying panic of a bank run.
3. Kyvig, Daily Life in the United States, 224.
4. McElvaine, The Great Depression, 92.
5. Ibid., 90.
6. “The Editor Says,” Sikeston Standard, June 10, 1932, 1.
7. Quoted in McElvaine, The Great Depression, 136.
8. “Seven New Mexico Bankers Go to Pen,” CSG, October 8, 1932, 1. Otis Seligman’s father, the governor, died shortly before the sentencing of his son.
9. “That’s That,” DP, July 15, 1932, 2. See Robert Lynn Fuller, “Phantom of Fear”: The Banking Panic of 1933 (Jefferson, NC: McFarland, 2012), 64.
10. “Illinois Banker Under Investigation for Irregularities Found Terribly Beaten,” DP, August 8, 1932, 1.
11. Walter Clyde Davis, FBI File 62-27247.
12. It would become semi-legendary as the Parkside Evangeline Residence for Young Women. Steven Kurutz, “On Gramercy Park, an Old-Fashioned Girl,” NYT, September 25, 2005.
13. See New York Herald Tribune, December 13, 1932.
14. “Attorney to File Petition Today for Reward Order,” CSG, September 2, 1932, 1.
15. “Betrays Self,” New York Herald Tribune, December 13, 1932, 3; “Banker,” NYT, December 12, 1932, 32.
16. Walter’s FBI file included a copy of the letter.
17. “Davis Affairs in Bad Shape,” CSG, June 28, 1932, 3; Eva quoted in CSET, June 24, 1932, 1. The Denver Post later claimed that not long after he went on the lam he wrote a letter in which he said he might commit suicide. “Walter Davis Uses Necktie to End Wild Financial Career,” DP, December 12, 1932.
18. “N.Y. Realty Man Commits Suicide,” CSG, April 23, 1932; “Charles Maag Hangs Himself,” CSG, April 19, 1932. Maag was a butcher who lived on the west side.
7: Orphans in the Storm
1. My account of my grandfather’s arrest and suicide is drawn from multiple newspaper articles. His arrest and suicide were covered in many of the country’s newspapers. For before-and-after photos, see “Price Marks of Crime,” DP, December 14, 1932, 1.
2. By the authorities I mean the DA, the police, and the receiver. “Will Press Search for Davis’s Hidden Fortune,” CSG, December 13, 1932, 1. Harper told the press the fortune was larger. See “Find Davis’s Safety Deposit Box,” CSG, December 16, 1932, 1.
3. “Suicide-Puzzle Quest Pushed Police,” LAT, July 1, 1932, 2; “Davis Attended Walker Hearings,” RMN, December 15, 1932; “Receives Tips on Davis and Fleagle,” CSG, July 19, 1933.
4. It was known as the Pecora Committee because of its unrelenting and savvy chief counsel, Ferdinand Pecora. It is worth noting that Congress had already passed some reform measures, including the Glass-Steagall Act, before the committee issued its final report in June 1934.
5. Ron Chernow, “Where Is Our Ferdinand Pecora?” NYT, January 6, 2009.
6. “That’s That,” DP, June 29, 1933, 2.
7. Quoted in Larry Doyle, In Bed with Wall Street: The Conspiracy Crippling Our Global Economy (New York: Macmillan, 2014), 149.
8. McElvaine, The Great Depression, 139–40.
9. Chernow, “Where Is.”
> 10. The police found in his apartment masses of papers strewn about, and they were filled with numbers that, to them, looked like nonsense. To the journalists covering the story in Colorado, the nonsensical figures demonstrated either that loneliness and worry had completely unhinged him or that he was trying to “plant” an insanity defense. And then there was the little-reported information that he seemed to have been in communication with a New York lawyer who was trying to help him sort out his business affairs. “Find Mass of Papers in Davis’ Room but Figures Mean Nothing; Insanity Defense Was ‘Planted,’” CSET, December 13, 1932, 1; “Davis Planned to Use Gun or Poison,” CSG, January 10, 1933, 10.
11. One detail he never took care of was writing his will. Perhaps he intended to elude the authorities for such a long time that he would be declared legally dead, at which point the insurance companies would pay out to the depositors and to Lula. But such a plan would have to have been predicated upon having enough money to last him for nearly a decade. In the famous case of the “Missingest Man in New York,” Judge Joseph Crater, who disappeared in 1930, nine years passed before he was presumed legally dead. See “Crater Will Case Up May 26,” NYT, April 28, 1939, 27.
12. “Funeral on the 17th,” CSG, December 18, 1932, 1; “Davis’ Deposit Box Found Almost Empty,” DP, December 18, 1932, 1.
13. Report, or Sale Bill, of Sale of Personal Property, State of Colorado, County of El Paso in re Estate of Walter Clyde Davis, Deceased, no. 372, Box 36804, CSA. A December 31, 1932, article in the Gazette claimed that his total estate was his Cadillac.
14. “Harper and Fertig Enlist Aid of U.S. Justice Department,” CSG, January 4, 1933; “Pay $1,000 to New York Detective,” CSG, January 5, 1933.
15. The papers did print articles about the so-called code letter. See “Code Letter to Wife Davis Case Clue,” CSG, December 20, 1932; “Search for Davis’s Box Nears Crisis,” CSG, December 21, 1932, 1; “Know Nothing of Any Code Letter,” CSG, December 22, 1932, 1; “$500 of Davis’s Money in Box,” CSG, December 25, 1932, 1.
16. “Eva Terry Willing to Aid Authorities in Solution,” CSG, December 13, 1932, 1; “Eva Terry to Keep Ring and $3,000,” CSG, October 23, 1936, 1; “Mrs. Davis Mute on Hubby’s Arrest,” CSG, December 12, 1932, 1.
17. “Banker’s Suicide Will Aid Victims,” RMN, December 13, 1932, 1.
18. “Mrs. Davis Mute.”
19. “Extended Time to File Claims on City Savings,” CSG, December 30, 1932, 1.
20. Obituary, Horace Hawkins, RMN, May 25, 1947, sec. 2, 1.
21. “Petition District Court to Call Grand Jury,” CSG, January 27, 1933, 1; “Gross Admits He Failed to Make Examinations,” April 26, 1933, 1; “Sensational Cases,” CSG, May 9, 1933, 1; “Validity of Grand Jury Is Attacked,” CSG, May 19, 1933, 1; “Indictments Quashed by Judge Young,” CSG, May 30, 1933; letter in Davis family archive.
22. “Services Today for C.T. Fertig,” CSG, April 16, 1933, 5; “TC Turner, Fertig’s Lawyer, and FW Haskew Named Co-receivers for City,” CSG, April 19, 1933, 12.
23. Undated letter from Dorothy Davis to Horace Hawkins, Davis family archive.
24. State of Colorado, County of El Paso in re Estate of Walter Clyde Davis, no. 372, Box 36804, CSA.
25. Another $30,000 withdrawal that day went to buy the stock of the El Paso Industrial Bank.
26. “Damnation of Mitchell,” Time, March 6, 1933.
27. “Mitchell’s Trial to Appease Mob,” CSG, May 17, 1933.
28. In Chicago’s Cook County, fifty-seven bankers were indicted, but most of these cases were reversed on appeal. See Fuller, “Phantom of Fear”, 63–67.
29. RMN, June 30, 1936; Pueblo scandal editorial, RMN, July 16, 1932. “If Law Invalid May Get Sentence Slashed,” CSG, October 8, 1932, 1. The article said that either Bentall would be pardoned by the governor at the expiration of his thirteen-year minimum for embezzlement or he could petition the state supreme court for revocation of the part of the sentence involving falsification of reports. “Depositors Ask Court to Offer Reward for WC Davis,” CSG, September 1, 1932, 1. Moreover, the legal establishment had assumed that it was illegal for a building and loan officer to file false reports, but that wasn’t what the law actually said. Nor did the law require an association founder to have any of his or her own money invested in said concern.
30. See Mason, From Buildings and Loans, 126. Mason also attributes the success of the S&L industry to the positive relationships thrift managers forged with their customers.
31. Only those thrifts that were federally chartered were members of the Federal Savings and Loan Insurance Corporation (FSLIC), which, like its bank counterpart, FDIC, offered deposit insurance. Ibid., 94.
32. “Savings and loan” was a locution already in existence in New York and in parts of Ohio, Washington, and elsewhere. See Hedges Ewalt, A Business Reborn, 9.
33. “Case Outlined Against Savings-Loan Officials,” LAT, May 3, 1940.
34. Office rent, office expenses, accounting fees, trustee and title expenses, and taxes came to over $25,000. However, many of those expenses, as I have indicated, would have to have been paid by a liquidating corporation. “Loan Company’s Assets $899,428,” CSG, July 8, 1936, 1.
35. “Mighty Sqawk [sic] Set Up by Receivership Racketeers,” Lodi Sentinel, August 25, 1934, 1.
36. “Newton to Draw $1,000 a Month Salary as Receiver,” DP, July 27, 1932.
37. “Seek Cancellation of B.&L. Claims,” CSG, February 14, 1935, 1.
38. “City Savings Checks Ready Next Monday,” CSG, July 12, 1935, 1.
39. Roth, The Great Depression, 36, 50. In California, salesmen sometimes offered depositors what they called a “more safe investment” for surrendering their passbooks.
40. Lawyers for and officials of the CSLC claimed that the corporation did not issue stock, but the courts disagreed. And the case turned definitively against it when the regional Securities and Exchange Commission said that the “CSLC was not complying with federal statutes as they affect stock exchange or sale.” “Will Get $180,000 from City Savings,” CSG, n.d. (probably March or April 1936).
41. “Issues Warning on Stock Offers to B.&L. Victims,” CSG, August 20, 1932, 1.
42. “4 Testify at Loan Probe,” San Jose News, January 23, 1935.
43. “Building-Loan Revision Bill Signed by Merriam,” LAT, May 14, 1935. New Deal Democrats wanted to do more, and fought unsuccessfully for the “Beesemyer Bill,” which would have allowed victims of the B&L collapse to file claims for compensation from the state of California. The state’s liability was reasonable, supporters argued, because state examiners failed to detect shortages. When it failed to get out of committee in May 1937, its backers even contemplated putting it forward as an amendment to the state’s constitution, but that failed as well. See “People’s Vote Urged on Beesemyer Bill,” LAT, May 5, 1937.
44. Roosevelt’s advisor is usually credited with coining the term in 1932. See Ronald Sullivan, “Stuart Chase, 97; Coined Phrase ‘A New Deal,’” NYT, November 17, 1985. For the claim that Costigan used it before Roosevelt, see Leonard, Trials and Triumphs, 20–21.
45. On Colorado politics, see Leonard, Trials and Triumphs, 20–21.
46. “New B&L Measures Planned,” CSG, January 7, 1933, 1; “Bill Introduced in Senate,” CSG, January 14, 1933, 1.
47. “Adams Hears Protest on Two Measures,” Greeley Daily Tribune, May 23, 1931, 1.
48. “Dust Bowl County Rejects Soil Plan,” CSG, January 5, 1938, 1.
49. For the ad language, see CSW, September 2, 1932. The contest was announced in the same issue that carried an article on Pratt’s candidacy. As for shutting down the campaign, I’m not sure this man was ever charged for his theft, or if he even existed. Perhaps the campaign was faltering.
50. “Seek Special City Election Next Autumn,” CSG, April 1, 1934, 1.
51. “Million Dollars Missing,” Daily Mail, March 19, 1935, 1.
52. Another source, a businessman who claimed to k
now him well, said he had run into Walter in Denver before the banker headed east and that he had on him a “fat bundle of securities.” “Davis Known to Have Big Bundle of Bonds When He Left Denver,” DP, June 26, 1932, 12; “Funeral on the 17th,” CSG, December 18, 1932, 1.
53. In Pueblo alone, 77 of the 133 home loans that the City had made there were in default. “Court to Protect Borrowers from B&L’s,” CSG, September 8, 1932, 5.
54. “Davis Affairs in Bad Shape After January 1,” CSG, June 28, 1932.
55. “Seeks Dividends on B&L Claims,” CSG, October 20, 1934, 1.
56. Receiver Turner apparently outmaneuvered the Davises’ lawyer, Hawkins. Among the policies Turner had allowed Lula to retain were quite a few that he knew had lapsed. In the end, the correspondence suggests that an expensive arrangement was brokered whereby Lula paid three different insurance companies nearly $20,000 to cover the back premiums and have the policies reinstated. None of this made its way into the press.
57. Ed Sharer’s wife wrote to Lula suggesting that she contribute $750 toward her husband’s court appeal. This was the man who, in order to save his own skin, had described himself as Walter’s “hired man,” as though that absolved him of responsibility for the fraud and forgery that juries had convicted him of. Then there was the letter from “A Tax Payer,” who wrote to say that in light of the insurance settlement, Lula should “reimburse” Jim Fleming and his wife, who had suffered a heavy financial loss. I doubt that it surprised Lula that one of the many people making claims against the estate was none other than Eva Terry. She claimed that she should not have to pay a fine on shares of State Savings Bank stock she owned because they had been a gift from Walter. As a stockholder in Sims’s failed State Savings Bank to the tune of $500, she owed Colorado’s banking commissioner double that amount. Davis family archive.
