Shortfall

by Alice Echols

  58. These are part of the oral history collection at the Pioneers Museum, Colorado Springs. “Citizens Left Destitute,” CSW, June 3, 1932, 4; “Can Walter Davis Avoid Extradition Like Insull is Now Doing in Greece?” SGT, October 16, 1932, sec. 2, 1.

  59. See “State Senator Roy Davis Speaks to Manitou Kiwanis Club,” CSG, November 24, 1931, 2; J. Herbert Pratt, “My Stand on the Old-Age Pension,” CSW, September 13, 1932, 1.

  60. Editorial, CSG, February 19, 1934, 4. For articles on the Taxpayers’ Association’s legal challenge, see “Age Pension Said Invalid by Taxpayers,” January 21, 1937, 1, and “Payment Sped as Pension Is Decided Valid,” CSG, January 27, 1937, 1.

  61. “Push Investigations of Age Pensioners,” CSG, June 11, 1936, 5.

  62. “Vets Who Receive Bonus Off Relief,” CSG, June 15, 1936, 1.

  63. “Relief Snowball Here,” CSG, January 24, 1937, 1.

  64. For attitudes toward relief, see journalist Lorena Hickok’s fascinating reporting collected in Hickok, One Third of a Nation. Hickok traveled across the country in her capacity as an internal reviewer of the government’s relief efforts. She reported back to Harry Hopkins, who ran the federal government’s Works Progress Administration.

  65. White, It’s Your Misfortune, 474; “Democratic Solon Assails Spending,” CSG, October 1, 1936, 1.

  66. Even during the first year of the New Deal, Colorado resisted some of its programs. For example, the state legislature released money to help fund relief efforts under the Federal Emergency Relief Administration (FERA), a New Deal agency, only after Denver nearly exploded as poor people rioted and armed mobs gathered to pillage grocery stores. According to FERA guidelines, the federal government would provide $1 for every $3 provided by states for relief. However, the Colorado state legislature decided against providing the required matching funds. FERA’s first administrator, Harry Hopkins, advanced the state half a million dollars a month until the end of 1933 when, fed up, he cut off the funds. After the rioting in Denver the legislature finally increased the state’s gas tax in order to provide matching funds. White, It’s Your Misfortune, 473–74.

  67. Also, in California’s 1934 gubernatorial race one sees the Republican Party successfully uniting voters across class lines to defeat the left-leaning Upton Sinclair. Olmsted, Right Out of California, 171–91.

  68. Johnson quoted in Leonard, Trials and Triumphs, 239.

  69. Athearn, Mythic West, 99. Much of the state’s press treated the poor, the beneficiaries of that aid, as an inherently suspect category. And yet the press gave a pass to those large corporations that manipulated relief for their own benefit. Two of the worst offenders were the Great Western Sugar Company and Rockefeller’s Colorado Fuel & Iron Company (CF&I). To even get on relief, beet workers for GWS had to be approved by a company man. They needed supplementary relief because the company paid so little. In Pueblo, officials of the CF&I dominated the committee coordinating federal relief. Relief administrators there mandated that full-time male employees who were in debt receive supplementary relief—on average $10 to $20 a month—but in the form of dispersing orders for food and clothing to be cashed at CF&I’s company store. New Dealer Lorena Hickok, who traveled across the country investigating the government’s relief efforts, wrote that what she found in Colorado was “complete domination by industry using us to subsidize itself.” See Hickok, One Third, xii.

  70. “‘Taxpayers’ Evade Issue; Says Unemployed Committee,” CSG, January 30, 1931. The criticism that those on relief rejected paid work was a common complaint. Yet it really made no sense for an unemployed person to get off relief for what might be just a few weeks of paid work when getting approved for relief was so very difficult.

  71. “Unemployed Council Presents Demands to City Council,” CSG, March 5, 1933, 2.

  72. “Agitator Arrested for Disturbance,” CSG, April 26, 1933, 3.

  73. The editor in question was John C. McCreary. F.B. Morris, “The Politics in the Women’s WPA,” CSI, September 24, 1936, 3. It’s true that relief administrators everywhere, concerned to limit the number of cases, aimed to make the experience uncomfortable. But, according to the Independent, conditions for relief workers in the Springs were much worse than in neighboring cities. In Pueblo and Denver the WPA filled workers’ orders for shoes, clothing, milk, and fruit, and without any reduction in what was allowed them for food, rent, and fuel. By comparison, the Springs provided a bare-bones program of relief. The paper said it wasn’t as much the New Deal as the “Raw Deal.” The term “Raw Deal” was usually deployed not by the left but by the right. William Randolph Hearst, who opposed Roosevelt and the New Deal, wanted all Hearst wire service chiefs and editors to use the term in all editorials and news stories about the New Deal. See David Nasaw, The Chief: The Life of William Randolph Hearst (New York: Mariner Books, 2001), 515. The Colorado Springs Independent’s coverage of the WPA is fascinating.

  74. I have searched the local Colorado Springs papers through 1941 for any mention of that final dividend payment. However, after the December 7, 1941, bombing of Pearl Harbor the dailies were filled with war news, and finding such a notice became very much a needle-in-the-haystack proposition. However, a Google search indicated that the International Typographical Union’s journal might reveal when that final check was mailed out and what the percentage of payout was. In a small notice about a deceased member who had willed his tiny estate to the union’s retirement home, located in Colorado Springs, I learned that as late as November 1942 the union was still waiting on the final dividend check, projected to be 10 percent. If this information is accurate, it means that depositors were reimbursed at 41 percent. See Typographical Journal (Milwaukee, Wisconsin), November 1942, 903.

  75. Some have argued that the HOLC discriminated in favor of the middle classes—an assumption that Cohen challenges in Making a New Deal, 274. My sense from the figures in the local Springs press is that the HOLC was helpful to a broad range of homeowners, not just to the middle class. Of course, the HOLC maps did establish the template for the insidious practice of “redlining,” which ensured the decline of neighborhoods consisting primarily of racial and ethnic minorities.

  76. Calder, Financing, 281; Cohen, Making a New Deal, 273.

  77. Cohen, Making a New Deal, 233; “Grand Jury Action into Building, Loan Charges Demanded,” CSG, May 6, 1937; “Convictions upon Embezzling Upheld,” CSG, February 3, 1942.

  78. Either Sharer was very lucky or his political connections saved him from serving a long sentence. In October 1932 he had been sentenced to between eleven and fourteen years for a single forgery charge. He had been allowed to stay at the county jail—certainly more agreeable than the state penitentiary—pending his appeal of that conviction. The Colorado Supreme Court reversed his forgery convictions twice on the grounds that the district attorney’s office had sent the wrong canceled checks on to the Court. One thing is for sure: the one judge on the state Supreme Court who always ruled in Sharer’s favor always included as part of his judgment his view that Sharer was just acting on orders from Walter Davis. For the final court action, see “Charges Against Sharer Dismissed,” CSG, April 16, 1935, 1; see also “E.C. Sharer, Former Springs Resident, Dies in Los Angeles,” CSG, August 16, 1947.

  79. “Fred N. Bentall Freed on Parole,” CSG, May 18, 1938.

  80. “Organize Federal Savings and Loan Association Here,” CSG, September 18, 1933, 1.

  81. The reason that HOLC records provide such a useful gauge of public attitudes toward B&Ls is that many of those facing foreclosure had obtained their mortgage through a B&L. To keep those folks in their homes the HOLC needed to work with B&Ls, including those in receivership.

  82. HOLC memo, R.L. Olson to Corwin A. Fergus, August 19, 1938. A full 20 percent of those surveyed reported that the question was moot because they had no savings. A mere 12 percent reckoned that a building and loan association might be “okay.” Records of the Federal Home Loan Bank Board, 195.3, Records of the Home Owners’ L
oan Corporation (HOLC), 1933–51, Textual Records, National Archives.

  83. “Summary: Survey of Pueblo, Colorado,” by the Mortgage Rehabilitation Division, Field Report, dated April 10, 1936. This same report indicted the Railway Savings B&L, noting that it charged exorbitant interest on its mortgage loans—between 7 and 10 percent. It also noted that in 1929 Pueblo banks had paid 4 percent on savings, a figure that subsequently dropped to 3 percent on the first $5,000 and 2 percent over $5,000. Records of the Federal Home Loan Bank Board, 195.3, Records of the Home Owners’ Loan Corporation (HOLC), 1933–51, Textual Records, National Archives.

  84. John A. Noakes, “Bankers and Common Men in Bedford Falls,” Film History 10, no. 3 (January 1998).

  85. Bosley Crowther, “The Spirits Move,” NYT, January 12, 1947.

  86. My discussion of the movie has been influenced by Jonathan Munby, “A Hollywood Carol’s Wonderful Life,” in Christmas at the Movies: Images of Christmas in American, British and European Cinema, ed. Mark Connelly (New York: I.B. Tauris, 2000), 39–57. Mark Harris described Capra as having “scattershot politics.” See Harris, Five Came Back: A Story of Hollywood and the Second World War (New York: Penguin Books, 2014), 422; James Chandler, An Archeology of Sympathy: The Sentimental Mode in Literature and Cinema (Chicago: University of Chicago Press, 2013), particularly ch. 2; John Bodnar, Blue-Collar Hollywood: Liberalism, Democracy, and Working People in American Film (Baltimore: Johns Hopkins University Press, 2003). It’s a Wonderful Life came to be compulsory TV watching every holiday season because in 1974 the studio holding its copyright failed to renew it and the film became public domain.

  87. For more about race and real estate finance, see Beryl Satter’s illuminating Family Properties, 41.

  88. Snowden, “Transition,” 158.

  89. Dick Netzer, “Savings and Loans Were Always a Scandal,” letter to the editor, NYT, April 24, 1990.

  90. Taper was one of the developers of Lakewood, California, a white working-class south Los Angeles neighborhood. See D.J. Waldie, Holy Land: A Suburban Memoir (New York: W.W. Norton, 2005).

  91. “Cripple Creek Mines Pour out $5,083,000 in Gold,” CSG, December 26, 1937, 1; “State’s Mines Add Millions in New Wealth,” CSG, January 10, 1938, 1. By the early fifties, Cripple Creek was a largely abandoned mining town that from the road looked like a “tiny disorder.” This is how a character in Patricia Highsmith’s 1952 novel The Price of Salt (New York: W.W. Norton, 2004) describes it (214–15).

  92. Ann Markusen, Peter Hall, Scott Campbell, and Sabrina Deitrich, The Rise of the Gunbelt: The Military Remapping of Industrial America (New York: Oxford University Press, 1991), 176. My account of the transformation of the Springs draws heavily from this book.

  93. Ibid., 178; Charles Banks oral history, interview by Brenda Hawley and Norman Sams, May 18, 1973, Pikes Peak Library District Oral History Project, OH IV, Pikes Peak Library District, Special Collections, 7. “Springs Named Big Army Camp” and “Defense School Is Allotted $58,518,” CSG, July 17, 1941, 1. Actually, the efforts at a partnership between the town’s leading businessmen and the military began at least as far back as 1922 when the city tried to pursue the building of a military aviation field in the springs. “City After Flying Field Again: Denver Not to Get It,” CSG, July 2, 1922; Mia Gray and Ann R. Markusen, “Colorado Springs: A Military-Anchored City in Transition,” in Second Tier Cities: Rapid Growth Beyond the Metropolis, ed. Ann R. Markusen, Yong-Sook Lee, and Sean DiGiovanna (Minneapolis: University of Minnesota Press, 1999), 313.

  94. Markusen et al., Rise of the Gunbelt.

  95. Philip Deloria, “Polarized Tribes: Colorado, Wyoming, and Montana,” in Religion and Public Life in the Mountain West: Sacred Landscapes in Transition, ed. Jan Shipps and Mark Silk (Walnut Creek, CA: AltaMira Press, 2004), 121.

  96. Markusen et al., Rise of the Gunbelt, 192.

  97. “City Charter Bars Unions,” CSGT, February 7, 1949, 1.

  98. Markusen et al., Rise of the Gunbelt, 175.

  99. A year after Hoiles acquired the Gazette, the paper’s printers, among the very few unionized workers in town, went on strike. Mary Ann Milbourn, “Hoiles: Dynasty to Bankruptcy,” Orange County Register, May 3, 2010; Carl Watner, “The Uncompromising R.C. Hoiles,” Orange County Register, November 27, 2007; “Gazette-Telegraph Is Placed in Hands of New Publishers,” CSG, January 11, 1946, 1; Aldo Svaldi, “Freedom Communications Sells Gazette in Colorado Springs, Six Others,” DP, June 11, 2012. In the end, the striking workers formed an alternative paper, the Colorado Springs Sun, which was also eventually bought by Hoiles’s newspaper empire for a reported $30 million. “Two Colorado Springs Papers Will Merge into One,” LAT, January 27, 1986.

  100. “Taxpayers Assn. Protests Proposed Tax on Cigarets,” CSGT, September 26, 1955, 8; “Taxpayers Assn. to Probe Schools’ Reckless Spending,” CSGT, May 20, 1955; “Opposes Proposed Bond Issue for New Police Station,” CSGT, February 26, 1955.

  101. “The Every Day Diary,” November 20, 1934, Roy Davis Collection, Folder 1, S2010.18, Pioneers Museum, Colorado Springs. According to Roy’s diary, he was among the first people Ed Sharer visited upon his release from the county jail. Ed Sharer and Roy Davis had been next-door neighbors. Still, it says a lot about Roy’s feelings toward his older brother that he met with Sharer, a man who consistently blamed Walter. Roy did note that he slept poorly after the visit. His “Year Book, 1942,” includes a June entry where he mentions that he sold seventy typewriters and rented out another forty to the army.

  102. Lawrence J. White, “The Savings and Loan Debacle: A Perspective from the Early Twenty-First Century,” in The Savings and Loan Crisis: Lessons from a Regulatory Failure, ed. James R. Barth, Susanne Trimbath, and Glenn Yago (Boston: Milken Institute, 2004), 18.

  103. My account is largely drawn from Kitty Calavita, Henry N. Pontell, and Robert H. Tillman, Big Money Crime: Fraud and Politics in the Savings and Loan Crisis (Berkeley: University of California Press, 1997). If one were to add interest over the next thirty years, the authors argue, the cost to taxpayers is closer to $500 billion. See also Snowden, “Transition,” 158.

  104. Eric Weiner, “Subprime Bailout: Good Idea or ‘Moral Hazard’?” NPR, November 29, 2007.

  105. Deloria, “Polarized Tribes,” 133.

  106. Bruce also became notorious for being convicted of tax evasion in 2011. See “TABOR to Be Bruce’s lasting legacy,” CSG, April 6, 2009.

  107. “TABOR Has Decimated Education, Critics Say,” CSG, October 29, 2012. The most recent debate about TABOR concerns the state’s marijuana law. Because of TABOR, Colorado, the first state to allow recreational marijuana sales, was threatened with having to return over $60 million in marijuana taxes to taxpayers. The legalization of pot was meant to raise revenue for the state and its schools, but TABOR limits how much money the state can take in before it has to return some of it to taxpayers. In the end, voters did pass a ballot initiative enabling lawmakers to spend the money on school construction and substance abuse programs. See Jack Healy, “In Colorado, Marijuana Taxes May Have to Be Passed Back,” NYT, April 2, 2015; Kristen Wyatt, “Colorado May Have to Refund as Much as $30 Million in Pot Taxes,” Huffington Post, February 4, 2015; John Frank, “Colorado Allowed to Spend Marijuana Tax,” DP, November 3, 2015.

  108. This question is posed by Garrett Epps in his article “Does a State Have the Right to Self-Destruct?,” Atlantic Monthly, August 8, 2012.

  Epilogue

  1. During the twelve-year period between the insurance settlement and Lula’s death, Lula appears to have withdrawn only $8,000 of the $65,000 worth of insurance from one of the companies.

  2. Email exchange with Karen Halttunen, February 21, 2016.

  Index

  “In this digital publication the page numbers have been removed from the index. Please use the search function of your e-Reading device to locate the terms listed.”

  Adams, Billy

  African Americans: homeownership and racially discrimina
tory lending practices; New Deal programs; race and class in America

  Ahmanson, Walter

  Alexander Film Studio

  alimony

  Allied Printing Trade Council

  American dream; homeownership and

  American exceptionalism

  American Farm Bureau

  American Savings, Building and Loan Institute

  American Tragedy (Dreiser)

  Andrews, Thomas

  Antlers Hotel (Colorado Springs)

  assignment claims, and passbooks, post-collapse scams

  Assurance Savings and Loan Association; failure and Sims’s suicide; liquidation

  Athearn, Robert G.

  Atlantic Monthly

  Automobile Dealers Credit Association

  automobiles: Depression-era production; financing (1920s); and social rank

  Babbitt (Lewis)

  Bailey Brothers Building and Loan Association. See It’s a Wonderful Life (film)

  Bain Banks (Chicago)

  Baker, George F.

  banking industry; B&Ls confounding distinction between banks and B&Ls; depositors’ vigilante justice against bankers; Depression and bank closings/failures; federal government’s privileging of bank customers; Hoover’s Home Loan Bank Bill; pre-crash; prosecutions of bankers; and small loans for short periods; stock market crash

  Baradaran, Mehrsa

  Barron, G.W.

  Beesemyer, Gilbert H.

  Beesemyer Bill (California)

  Bell, Sherman

  Bentall, Fred; arrest and jailing; B&L scandal; embezzlement charges; freed on parole; Home Building and Loan Association; and the KKK

  Bentall, Selma

  Bethlehem Steel

  Bird, Isabella Lucy

  Birdsall, George