Thanks To Texas Bravado, Dallas Landed Federal Reserve 100 Years Ago
One hundred years ago, Dallas was selected to be one of 12 locations to host a Federal Reserve Bank. It not only beat out other Texas cities, but also New Orleans, which at the time had a population three times larger. So how did "Little D" get a Reserve Bank? Texas bravado, in part.
Together, the 12 banks form an agency that regulates the entire financial system and by extension the broader economy. That's why 100 years ago, businesspeople in cities across the country scrambled to make the case to be one of the chosen few.
Dallas didn’t seem like an obvious choice.
“It was actually the smallest city selected to be a Federal Reserve site,” says Princeton Williams, economic education program coordinator at the Dallas Fed.
Three cities in Texas were vying for a reserve bank: Houston, Fort Worth and Dallas.
It was a book and a train ride that helped Dallas stand out.
The Book Of Facts
A leather-bound, gold-embossed book laid out an argument for a Federal Reserve bank in Dallas. It's called “Texas and the Southwest, a Book of Facts.”
It contained statistics on the city’s commercial prowess, such as factory output and new building permits. Williams explains that while Dallas might not have been the biggest, the city was growing at record-speed. Dallas had grown by more than 100 percent between 1900 and 1910, and by 41 percent in just the four years from 1904 to 1909.
“Texas had always been an agricultural economy, and at the turn of the 20th century, it was becoming a commercial center and economic center that was going to take a leading role in the Southwest,” Williams said.
The man behind the creation of the Book of Facts was George Dealey, publisher of The Dallas Morning News. Dealey organized a pro-Dallas rally in Washington and exploited the contacts he had in the capital.
Perhaps his most influential intervention was something he arranged on a train ride.
The Train Ride
When Dealey learned that Postmaster General Albert Burleson – an influential figure in the Woodrow Wilson administration – would be traveling through Texas by train, he dispatched a reporter and bank executive, Howard Ardrey, to “accidentally” run into him.
It was on this journey, from St. Louis to Dallas, that Ardrey made the sales pitch for Dallas.
And it worked.
The Dallas Fed’s Growth
The Federal Reserve Bank of Dallas first opened its doors in November 1914. At the time, the U.S. was on a gold standard, and air conditioning had just been invented.
When the few dozen employees moved into the Fed on South Akard Street in the 1920s, it was one of the first buildings west of the Mississippi to have air conditioning.
Today, more than 1,000 people work at the Dallas Fed, which is now in the Arts District. While much has changed in the past century, there’s one tradition that remains: gingersnap pudding.
For more than 60 years, Dallas Fed employees have been eating a chilled icebox pudding, made with gingersnaps, fruit, and a rich custard. (For the recipe, click on the slideshow above and look for the recipe picture.)