The decade which ended at the outbreak of the Civil War saw New Orleans at the height of its commercial prosperity according to some; but in reality, having failed in its great destiny, what Jefferson and other enthusiasts had seen for it was that it would become the port and emporium of the entire Mississippi valley, shipping all its products to the markets of the world and supplying it in return with all it needed in the way of European or manufactured goods. There seemed, indeed, at one time every chance of this prediction coming true, and New Orleans
narrowly missed this destiny, which would have made it the greatest commercial city of the world. The lack of a power that would take its boats up-stream stood in the way of success at first. There was no difficulty in getting the produce to the city and thence to market, either in Europe or on the Atlantic seaboard of America; but there was a difficulty in furnishing return supplies, such as the people of the interior needed. The discovery of steam and its application to boats so that they could ascend the river against the current overcame the difficulty and gave the merchants of Xew Orleans an opportunity of controlling and monopolizing the entire commerce of the Mississippi Valley, the imports as well as the exports; and, for a time, it looked as though they would do so, in which event New Orleans would have accomplished all predicted of it; but the chance had been lost and, instead of becoming the port of the whole valley, it had been satisfied to pin its faith on cotton, to become the metropolis of only a section. It had allowed the canals and afterward the railroads to divert a large amount of business to the Atlantic ports, and this diversion was at its height when the firing on Fort Sumter brought on the cataclysm in which the commerce of New Orleans was, for a time, completely overwhelmed, and the city had to go to work to build up its trade once more and on entirely new lines.
When the Civil War came on, a few far-seeing economists saw the danger ahead of New Orleans and issued frequent warnings to its merchants, declaring that the trade of the city, however prosperous it might appear to be, was not built on safe foundations, and that there was a danger lest it might be lost. But these warnings were as futile as those the prophetic Cassandra sang to the Trojans. Mr. De Bow, editor of De Bow's Keview, the leading commercial authority of New Orleans, and one of the best commercial and financial papers ever published in the United States, complained, month after month, of the apathy that the merchants of New Orleans showed in the matter of railroads; pointed out that the railroads were likely to become the chief means of transportation, and that the Eastern ports, by constructing them in to the West, territory formerly tributary to New Orleans, were diverting from that city trade rightly belonging to it. Mr. De Bow succeeded in arousing interest among some of the Southern financiers and capitalists in this matter. A railroad agitation was started, which resulted in the construction, largely through the assistance of New Orleans, of a line which was to connect with the Ohio river and thus bring back to the city the trade it had recently lost. This road was completed in part on the very eve of the Civil War, but New Orleans had no fa\orable chances to test what it could do. Save the Opelousas railroad.
running some eighty miles westward to Morgan City, the old Pontchartrain railroad, one of the first constructed in the country, had been, for twenty odd years, the only line New Orleans possessed. Thus it will be seen, that New Orleans, after starting out with the Pontchartrain road to build railways had stopped there, and, like Eip Van Winkle, had slept for twenty years, while the Atlantic seaboard cities were extending their railroads into the interior.
Whether the railroad agitation, which began in New Orleans in 1858-GO, would have accomplished any important results in keeping the trade of the West can only be surmised, for the work was completely stopped by the Civil War. It is doubtful if the people of New Orleans could at that time have been brought to realize the possibilities of railways. Public sentiment was decidedly hostile to them. It was a prevalent idea that it was a great commercial battle between New York, for whom the railroads were fighting, and New Orleans, whose success depended on the Mississippi, and it was impossible to convince the people of the lower valley that any transportation could be as cheap and as satisfactory as the river, free and open to all. The railroads were regarded in the Southwest simply as feeders to the Mississippi or its tributaries, and it remained for a future year to see railroads built parallel to the river and along its very banks in the face of the steamboats.
The season before the Civil War, 1859-60, saw the largest receipts of produce at New Orleans, and the heaviest and most profitable trade the city had ever done; and it stands on record to-day as the summit of its commercial prosperity. The number of steamboats arriving at New Orleans was, it is true, not as great as in 1846-7, but the boats had, in the meanwhile, more than doubled in size, and the tonnage reaching New Orleans by the Mississippi has never been equaled since. The total receipts of produce amounted to 2,187,560 tons, and the total trade in the receipts and shipments of produce and in the exports and imports coastwise, and to foreign ports was: Eiver trade, $289,565,000; ocean trade, $183,725,000; total commerce of New Orleans, $473,290,000. To-day, forty years afterward, when the production and wealth of the country have increased five-fold, the trade of New Orleans is no greater than it was in the last year of peace.
The wide extent of the river trade then is well shown in the several regions or districts with which New Orleans was carrying on business. No less than thirty-rhree different lines, or rather, different points of communication, are given in the commercial reports of the day. Not only did New Orleans have a complete monopoly of the business of the adjacent States of Louisiana and Mississippi, but
it had no less than twelve steamboat arrivals from Cairo, Illinois, in direct communication with New Orleans. From Cincinnati 206 steamboats arrived during the year; from the Cumberland river, 66; from Evansville, Indiana, 8; from Louisville, 173; from Memphis, 110; from Pittsburg, 526; Paducah, Kentucky, and St. Louis, 472; Tennessee river, 16; Wheeling, 9; and White river, Arkansas, 4.
Divided by States in order to give some idea of the region commercially tributary to New Orleans at that time, the arrivals of steamboats and other vessels navigating the Mississippi, the following is interesting:
ARRIVALS AT NEW ORLEANS OF RIVER VESSELS BY STATES
Louisiana 1,835 Pennsylvania 134
Missouri 672 Illinois 112
Mississippi 388 Indiana 108
Ohio 306 Texas 48
Tennessee 236 Virginia 9
Kentucky 226 Alabama 10
Arkansas 140
Two-thirds of this business was lost by the merchants of New Orleans during the Civil War and has never been regained. It can only be surmised what the results would have been had the war not come on us. Certain is it, however, that unless New Orleans had realized the importance of railroads, as it did not fully do until years afterward, unless it had contributed from its superabundant capital toward their construction, instead of placing too much confidence on the Mississippi river and its "unequaled advantages," it would have lost the region commercially tributary to it, war or no war, but it would have taken decades to do what four years of Civil War brought about.
New Orleans was losing, at that time, another branch of business, the importance of which it never fully recognized. When the immense tide of foreign immigration poured into the country in the last of the forties, in consequence of the great famine in Ireland and the political disturbances in Germany and other parts of the continent, growing out of the revolutions of 1848, the bulk of the immigrants made the Mississippi Valley their destination. They passed on through New Orleans by the thousands and tens of thousands, and went up the river to their destination in Illinois, Ohio, Indiana or Missouri; although many thousands remained behind in New Orleans, to give that city its cosmopolitan population. It cannot be said that New Orleans ever appreciated this immigration or saw what it meant for the development of the country. There was a dis-
tinct prejudice against it, growing out of the slavery issue, and tlie eity made 80 few efforts to keep this business, which was once largely centered hero, that the immigration drifted to New York, where it did much to build up that city into a great manufacturing center. Here, again, was another opportunity lost.
Yet in spite of all these neglected opportunities New Orleans was at the outbreak of the Civil War one of the great ports of the world, and to all appearances the most prosperous commercial city in America. It ranked second to New York City in the amount of commerce it handled, but it was further lidiiud that city than it had been in 1840, and there seemed little chance of its ever distancing Manhattan, as had seemed probable twenty years previously. Its cotton trade yielded a larger profit than the grain, flour and provision trade, which had been diverted to New York. Its banks were running over with gold, and had money to contribute to all important commercial enterprises. It was New Orleans capitalists who stood at the van and were agitating and preparing for the continuation of a railroad or canal across the isthmus of Panama or Tehuantepec in order to give us an outlet to the Pacific. Its banking and financial system was regarded as the safest and soundest in the Union, and even New York was glad to borrow some ideas from it. Its commercial and financial supremacy over all the country tributary to it, which included some half a dozen States, was undisputed. New Orleans supplied the capital for the cultivation and movement of cotton, sugar and the other crops of the South. The planters almost without exception were indebted to its merchants and could not send their produce to any other port, nor buy what they wanted elsewhere. The consequence was that no other comniennal towns existed in the neighborhood of New Orleans; that city swallowed up all the trade and business of its section. Louisiana and Mississippi were signally deficient in the cities of the second class, which were springing up throughout the North and West, and even in the Southern Atlantic States. The policy of commercial centralization was marked and operated in the interests of New Orleans and its merchants.
These merchants were men of the highest character and integrity, far-seeing in their business, but unfortunately accepting the doctrine of the kingship of cotton; and they thought that slavery, upon which the commercial system of New Orleans, as well as the industrial system of the South, was founded, was safe and beyond the danger of destruction. New Orleans was a most cosmopolitan city, and its merchants, like its population, came not only from all parts of the country, but from all parts of the world. The Southern element was the largest and gave
direction to the course of commercial sentiment; but some of the leading business men were of Eastern and even of New England origin. With their life in New Orleans, however, they soon became pro-Southern in their sentiments, habits and views of life. The West was but poorly represented in commercial life, and this fact, and the political prejudices which were growing up in the country over the slavery question, contributed toward the loss of the Western trade. The Creoles, or French of Louisiana descent, still controlled the sugar trade, which ranked next to cotton in importance. The foreign element was largely represented, mainly by the English and French, engaged, however, principally in the import trade, in supplying the markets of New Orleans and the South and such parts of the West as still received their goods through the Southern metropolis with the manufactured products of Europe. The slave business, although it was not too conspicuous, constituted an important element of the trade of New Orleans. That city was the best slave market in the South, negroes bringing the highest prices there, and it handled thousands of them each year, selling them to the planters engaged in opening up new cotton and sugar lands.
The commercial methods and practices were quite different from what they are to-day, and if more expensive were more picturesque. There were no commercial exchanges then, where quotations of produce could be obtained, and business was handled more or less in the saloons, which called themselves "exchanges," and made some attempt to give the standard prices of the leading commodities; but, as might be expected, these prices fluctuated widely. The commercial business of the city, instead of being hidden away as it is to-day, at the railroad depots, was concentrated on the le\-ce; and "the levee" was one of the show places of New Orleans, to which strangers were taken to give them some idea of the city's immense commerce. It seems to have impressed them all, for they declared without exception that they had never seen anything like it. The description of the levee in those ante-bellum days reads like fairy tales from The Arabian Nights. The levee was the storehouse for all the great Mississippi Valley. Along the wharves lay steamboats or steamships two or three deep, for the wharfage was not sufficient to accommodate all the vessels loading at the port. All was action; the very water was covered with life. It was beyond all question the most active commercial center of the world, with which not even the docks of Liverpool and London could merit comparison; and whenever any one expressed fear that the railroads would sap the commerce of New Orleans, he was taken to the levee and asked if that looked like commercial decav.
S70 STANDARD HISTORY OF NEW ORLEANS.
In the midst of all this, in the very height of New Orleans' prosperity as a cotton market, when it exported half of the cotton crop of the country, came the shock of Civil War. The previous season, 1859-60, had been one of the most prosperous in the history of the city, and New Orleans, which, like the rest of the South, anticipated a very short war, if any, took a most roseate view of the future, and had no idea that the four j'ears' struggle which was to ensue meant its commercial ruin and its setback a generation or more.
Anticipating the blockade of the port, a very earnest effort was made to market the cotton crop at as early a day as possible and before the Federal fleet could get off the mouth of the Mississippi. Wonders were accomplished in that direction, but it was of course impossible to get all the cotton exported in time. The receipts of produce at New Orleans, however, for the season 1860-1 showed only a slight loss from the previous year, being $155,863,564, as compared with $185,211,25-1: for 1859-60, not a bad showing for a blockaded port.
The history of the next four years is military rather than commercial. When the Civil War shiit up the mouth of the Mississippi to the Western States, a demand went up from them to the Federal government that it be opened. Yet this demand, if compared with that made by the settlers in the upper valley, in 1798, showed that the Mississippi had lost some of its importance as far as they were concerned. In 1798 the people of the Ohio Valley had declared that they could not get along without the navigation of the river; but in 1861 they found that it was not absolutely necessary to them, although advantageous. None the less President Lincoln saw how important from a military, if not a commercial, point of view, was the possession of New Orleans, and the control of the Mississippi, and almost his first expedition was that which, under Farragut and Butler, occupied "the Crescent City" in a little over a year from the time Louisiana had seceded from the Union.
In April, 1863, the Federal fleet passed the Confederate forts defending the mouth of the river and appeared before New Orleans. It was greeted with a scene of wholesale destruction, characteristic of the then commercial conditions. All the steamers in the river which could not escape up-stream were set fire to and sent floating down the river in flames, lest they might fall into the hands of the Union forces. Cotton being deemed at that time a contraband of war, the possession of which would strengthen the Union cause, was ordered destroyed by a special committee appointed for that purpose, hauled from the warehouse to the river front, piled up on the wharves and publicly burned; and the city was full of cotton
at the time, the crops of 18G0-1 and 18G1-2, which had not yet been marketed, because of the blockade, being still stored there. A quantity of sugar, molasses and other products was similarly destroyed, through a misunderstanding of the order issued.
The statistical reports of the commerce of New Orleans for the four years of the Civil War are misleading and give a false idea of the commercial condition
of that city. They are as follows:
No. of steam Value of prod-boat arrivals. uce received.
1861-2 1,456 $ 51,510,900
1862-3 655 29,766,451=
1863-4 1,414 79,233,987
1864-5 1,481 113,649,280
The value of the produce received at New Orleans during this period is apparently very large for a city surrounded by a hostile army and with only a small region tributary to it. This is due mainly to the greatly inflated value of goods, and particularly Southern products then. In actual volume, the receipts of produce at New Orleans during the first year of its occupation by the Union forces were the smallest since Louisiana had been purchased from France. There was tributary to the city only one hundred and forty miles of river, for the Mississippi was closed at Port Hudson, thus cutting off the Red river and all the tributaries except the Lafourche. Over this small stretch of country some few steamers ran, picking up whatever freight there was, carrying supplies to the planters or the Union forces, but the business was small and risky. The receipts of New Orleans for the season were just enough to feed the population of the city. There were no exports save of such cotton as could be raised inside the lines or smuggled in. In 1859-60 New Orleans had received 2,185,600 bales of cotton. This dropped to 38,880 bales in 1861-2, and to 20,774 in 1862-3. With the capture of Port Hudson and Vicksburg, its business improved somewhat in 18G3-4, the total number of bales received running up to 131,144. The last year of the war, 1864-5, showed a still greater increase to 275,015 bales. During this period the commerce of New Orleans was practically dead. Its merchants, with few exceptions, had left the city, and the business was handled entirely by foreigners or by those connected with the army who could get special favors from the authorities. So dead was New Orleans, for it had no manufactures to fall back on, that in spite of the fact that its population was much smaller than it had been, in consequence of the large
muiibcr of OrleaniaBS who had gone out into the Confederacy, it was not self-supporting, and the military authorities were compelled to distribute relief and feed a considerable proportion of the poorer classes left without the means of living, in consequence of the decay of the city's commerce.
An effort made in 1865, when peace had come, to find what New Orleans had lost by the Civil War made a most melancholy showing. It was found that the Western States were getting from New York their coffee, sugar and other supplies which they had formerly obtained through New Orleans, and the shipments of Western produce through the Crescent City had declined 75 to 90 per cent. Thanks to the embargo of the war, the railroads had gained in four years an advance on the river route with which the commercial prosperity of New Orleans was so closely identified that they could not have otherwise gained in twenty years of ordinary competition.
With the return of peace the merchants of New Orleans found that the commerce of this city was almost completely destroyed and that they would have to rebuild it from the very foundation. They took a most hopeful view of the future, under the belief that the conditions that prevailed at the time of the outbreak of the war would be resumed at once. This optimistic sentiment was reflected in the commercial activity shown in 1866, and the great advance which took place in all property values—an advance which would be called "a boom" to-day. The merchants found their task harder than they had imagined. The ways of doing business had radically changed during the interim and New Orleans had to conform itself to these new ways. It had, in the old days, had no commercial exchanges, and the bulk of the business had been transacted immediately on the levee. The necessity was recognized of having some place where information could be obtained as to the movement of crops and current prices, and the Merchants' Exchange was established on the model set by the Northern and Western cities.
New Orleans was still deficient in railroads, and an earnest effort was made to extend them, but at first in vain; and the city was compelled to depend mainly upon the Mississippi and its tributaries. Its merchants saw the trade of the great Empire State of Texas slipping away from them from lack of railroad communication. An attempt was made to retain this trade with steamboats running up the Eed river to Jefferson, but the river route was uncertain because of the low water, and was expensive. The old difficulty at the mouth of the river, growing out of the low water on the bars, grew steadily worse, in consequence of the larger size and greater draft of vessels engaged in ocean commerce. The delay of vessels
at the passes, waiting for a favorable tide or rise in the river to take them out, the cost of towing them over the mud-heaps, were expenses that preyed on the commerce of New Orleans. In all the conventions held at that time the merchants called attention to the trouble and asked favorable action on the part of Congress.
The railroads had been able to considerably. reduce their freight charges by several improvements and devices, and it was felt that New Orleans must make a similar cut from the rather high charges which the steamboats still demanded. This reduction was brought about by the introduction of barges built entirely for freight transportation and not encumbered by the magnificently fitted up saloons, which had formerly been considered a sine qua non in river steamers. This improvement had a marked effect in reducing river rates, and, for a short period in the seventies, New Orleans enjoyed a large share of the grain trade. But even with cheaper river rates the situation was not altogether satisfactory. The railroads continued to divert trade from New Orleans. In 1859-60 this city had handled 46 per cent of the cotton crop; in 1866-7 its proportion was only 35 per cent. It dropped to 33 per cent in 1870-1, and to 27 per cent in 1876-7,
A new era then began to dawn upon New Orleans—the era of railroads. The city had previously been almost hostile to railroads, confident that the water route was the cheaper; but at last it was beginning to see that it needed the railroads as well as the Mississippi. In 1870 it secured its third road, the New Orleans, Mobile & Texas, a short line, and largely competing with the river; but a step in the right direction. In 1871 was noted the fir.st receipt of produce in New Orleans by rail from a river town. This was a large quantity of flour which came from St. Louis by rail, whereas, previously all such shipments had been made by river. The flour was brought from St. Louis for seventy-five cents a barrel, the same rate it would have cost had it been brought on a steamer, but it saved the expenses of insurance. This movement, prophetic of the future, was one to cause a groat deal of surprise, because New Orleans had close, excellent and cheap water communication with St. Louis at the time, and boasted loudly of its barge line of seventy-three river barges.
The last twenty-five years have seen a radical change in the commerce of New Orleans and a steady improvement for the better. The turning point may be considered to be 1874-5, when the jetties were begun. The bad condition of the passes had been a source of constant worry and a serious hindrance and expense to commerce. It was evident that New Orleans could not hope to compete with other ports if vessels of over one thousand tons were completely shut out or
admitted only after long delay. In the seventies the question came to a focus. Three plans had been proposed; a canal, dredging, and jetties, which by contracting the river would increase its current and enable it to wash away the obstructive bars. The dredging was tried and proved a failure; and Congress then, with rare good luck for New Orleans, allowed Captain Eads to try his Jetty plan. It was a grand success. Completed in 1879, it afforded a depth of thirty feet in the center of the channel and opened New Orleans to the largest vessels then afloat. To the jetties New Orleans owes much of its commercial prosperity to-day. They expedited what had long hung fire—the construction of railroads to the city. In the days immediately succeeding the Civil War every inducement had been held out to the railroads to build to New Orleans. They were offered bonds, financial assistance and public lands, but they could not be induced to build. It was not until 1873 that New Orleans was connected by rail with the neighboring city of Mobile, only one hundred and forty miles away. But when the railroads saw that New Orleans had deep water, that it was one of the best ports from which to ship, they exhibited as great a desire to have terminal facilities there as they had shown disinclination before. The result was the completion of several trunk lines, making New Orleans the terminus of five of the largest railroad systems of the country.
By the purchase of the Mississippi Central and the New Orleans, Jackson & Great Northern, the Illinois Central obtained a direct rail route from Chicago and the grain fields of the Northwest to the Gulf, which connection was afterward strengthened by the purchase of the Yazoo & Mississippi Valley system. Similarly, by the purchase of the New Orleans & Mobile Railroad, the Louisville & Nashville system, with its lines through the States of Alabama, Kentucky and Tennessee, found an outlet on the Gulf at New Orleans. The Cincinnati Southern and the Great Southern Railway system, running through half a dozen States, secured entrance to New Orleans over the New Orleans & Northeastern.
On the west bank New Orleans, which had so long lacked railroad connection with Texas, secured two lines to that State. The Southern Pacific extended the old Opelousas road to connect with its Texas lines: and the Texas & Pacific road did the same for the old New Orleans, Mobile & Texas Railroad, building it to Shreveport, Dallas and Fort Worth.
The continuation of these several lines had a material effect upon the commerce and trade of New Orleans, and the city regained much of its old business.
STANDARD HISTORY OF NEW ORLEANS.
575
How much the railroads have contributed to this improvement the following figures show:
RAILROAD BUSINESS OF NEW ORLEANS.
Year.
1872-3 . 1873-4 . 1874-5 . 1875-6
1876-7
1877-8
1878-9
1879-80
1880-1
Tons of freight forwarded.
372,9()4
1881-2 493,297
1882-3 1883-4 1884-5 1885-6 1886-7
603,912 640,820 642,820 662,600
685,447
1887-8 720,840
1888-9 1,324.208
1889-90 1,486,515
1890-1 1,493,226
1891-2 1,452,620
1892-3 1,403,538
1893-4 1,412,541
1894-5 1,374,677
1895-6 1,386,378
1896-7 1,530,481
1897-8 1,608,505
1898-9 1,534,234
Tons of freight Total tons of received. freight handled.
464,240
530,224
615,963
729,')30
807,672
714,842
722,213
998,788
937,624 1,223,939 1,505,958 1,662,200 1,754,282 1,777,811 1,940,063 2,009,576 3,074,200 3,456,197 3,555,742 3,850,968 3,958,022 4,014.072 4,106,599 4,516,193 4,932,212 5,573,002 5,464,615
564,660 730,642 902,046 1,022,272 1,113,462 1,165,211 1,254,616 1,282,736 1.749.892 1,969,681 2,064,516 2,398,368 2,554,484 2,601,-531 2,731,932 3,129,815 3,401,371 3,964,497 3,390,381
The total commerce of Xew Orleans for the year season 1898-9 was as follows:
Tonnage. Value.
Receipts from interior by river, rail and canal 5,096,660 $147,731,618
Imports by coastwise vessels 505,819 59,986,872
Imports by foreign vessels 1,478,124 11,946,344
Total receipts 7,080,600 219,664,834
Shipments by rail and river 1,740,500 $82,165,860
Exports, coastwise 512,015 47,762,812
Exports, foreign 1,465,418 90,121,115
Total shipments 3,717,633 $220,059,787
Grand total of commerce of the port 10,798,233 $430,724,621
This port compares as follows with previous seasons:
Total Commerce of New Season. Orleans.
1876 $371,664,126
1886 456,063,948
1889-90 531,484,618
1890-1 531,764,118
1891-2 496,465,741
1892-3 537,830,632
1893-4 483,507,065
1894-5 455,659,431
1895-6 419,580,908
1896-7 479,751,019
1897-8 486,131,713
1898-9 439,734,631
The maximiim commerce would seem to have been reached in 1890-1. These figures, however, are somewhat misleading, for ftiis reason: that the prices of staple products were much higher than they were later, so that the total does not really represent more in volume than the business of the later years. The last two years show some loss on account of the interruptions to business and the diversion of trade due to quarantine embargoes. The average business of New Orleans has materially changed from previous years. First the bulk of the products from the interior are brought to the city by rail instead of river. A much larger share is mere transit goods, not handled at all in the city, but sent there in transit for shipment abroad, and consequently leaving a smaller percentage of profit in the city. The business is done largely through the exchanges, the cotton and sugar e.xchanges and the board of trade, and the fluctuations are less marked than formerly. Exports are carried mainly in foreign vessels. Probably one-fourth of the exports are coastwise, mainly to New York, the other Atlantic cities having little ocean trade with New Orleans. Philadelphia, Baltimore and Boston occasionally send cargoes or receive produce from New Orleans, but the trade is uncertain and there are no regular lines, as to New York. On the other hand steamship, lines run regularly to most of the European ports, especially Liverpool, London, Havre, Bordeaux, Antwerp, Bremen and Palermo; and the bulk of the trade is in the hands of these vessels instead of the tramp steamers, as formerly. The direct import trade has shrunk very materially, although the imports are really much larger than ever before; but they come by way of New York and the coastwise steam-
STANDARD HISTORY OF NEW ORLEANS. $77
ers from that port. These steamers handle twice or three times as much in the way of imports to New Orleans as the foreign lines.
In the past few years the railroad rates between New Orleans and the interior were very greatly reduced, with the result that the city had become in 1896 the third largest grain port in the Union, and was handling a much larger share of the trade in Western produce,—flour, grain, pork, etc.; but this subject is more fully treated elsewhere in the commercial and other advantages of New Orleans. At the end of the nineteenth century New Orleans occupies a less exalted position relatively in the commerce of the world than it did at the beginning of the century, but it still possesses the same advantages and opportunities, only awaiting their utilization. Nor does commerce exercise the same supremacy in the city as of old. Up to 1860, New Orleans devoted itself almost exclusively to commerce and did little to encourage manufacture, whereas, in 1900, the latter industry gave employment to more persons than all the branches of mercantile and commercial life. The promise seems to be a city equally divided between the two—a great mart of the world's trade, and a great manufacturing centre.
CHAPTER XXIII.
BANKING AND FINANCE. By Norman Walker.
THE history of banking in New Orleans is interesting and instructive, and not wholly local; that is, not New Orleans alone but the entire country is interested in the development of banking in that city. During the period previous to the Civil War, from 1820 to 1860, New Orleans occupied a far more important position in the commercial and financial system of the country than it does tc-day, and from practice and experiment it built up a banking system founded on such strong principles, so well adapted to the needs of the country, with a currency so elastic yet so well protected, that the banking law of Louisiana was imitated or copied in a number of the States, even in the older East; and some of the principles which first saw the light in this law have been incorporated in the National Bank system of to-day. New Orleans had the benefit of the experience and knowledge of financiers who had graduated in the best banking schools of Europe. When the development of steam navigation gave it control of the commerce of the Mississippi Valley, it became also the banker of the immense population residing in that valley. It was through the New Orleans banks that the exchanges were made and the European purchasers paid the Southern and Western farmers for their cotton, sugar, floiir, etc.; so that these banks were better known at the time in Paris, London, Amsterdam and other monetary centers than even those of New York. To maintain this necessary credit, the laws had to be such as to assure the European bankers againsf all possibilities of loss; and this was a more difficult matter then than to-day, because American credit had been seriously crippled by several ugly failures and even by repudiation. The home conditions also required the adoption of some plan by which the people of the interior could obtain without difficulty such capital as they needed for the development of tlie country, for the opening of new farms, the building of railroads and other improvements. Most of this capital, for the South at least, came through New Orleans and through the banks of this city. Later on, it was found possible to negotiate
'oon "rvu/u
loans in Europe and issue bonds, wliicli ultimately proved too easy a matter and brought on excessive indebtedness and finally a crash; but in the earlier days the New Orleans banks were counted on to furnish the capital needed for any great improvements. Hence we find many of the new improvement companies to be banking institutions or to have banking departments attached to them. The Canal Bank is one of the relics of this system, having been organized with the specific purpose of building the new canal. A Gas Bank was organized for the purpose of providing New Orleans with gas; while the Citizens' Bank had the special object in view of assisting in the development of the agricultural lands of Louisiana. The Commercial Bank was organized to provide the city with water-works.
In those days, when the varied currency of the country caiised even the natives great confusion, and when "shin-plasters" left every one in doubt as to the value of notes, the bankers of New Orleans set to work to establish so perfect a system that their notes would never be at a discount. This they succeeded in doing, after some very heavy losses and a great deal of financial confusion, and it had a most beneficent effect on the trade and commerce of the city, ultimately compelling the neighboring States to adopt the same or similar systems. It was due as much to its splendid banking system as to its commercial position that New Orleans won the high position it occupied in the ante-bellum period, when it had the entire Southwest not only tributary to it commercially, but in debt to it and completely under its financial control. As the banks of New Orleans are largely responsible, therefore, for the National Bank sj'stem of the country and for the credit system upon which the cultivation and moving of crops in the South are based, a history of banking New Orleans will prove interesting not only from a local but from a national point of view as well.
The history of banking in early French and Spanish days in New Orleans and Louisiana—for the two are the same, there being no banks outside of the metropolis until of very recent years—is much like the celebrated chapter on owls in the history of Iceland, which simply recites, "There are no owls in Iceland." There were no banks in Louisiana before the coming of the Americans. The government, first Crozat, then France, then Spain, had securely in their own hands absolute control of the finances, and managed them most execrably.
The very foundation of the colony was due to a bank; for the famous iMissis-sippi Company, to which Louisiana owed its origin, and tlie Royal Bank of France, were one and the same thing, with the famous John Law at its head, the charter
of the company and its exclusive right to trade with Louisiana being one of the chief assets. As noted elsewhere, the bank failed and the French government took charge of the colony. The company which had control of Louisiana wound up its affairs in 1731, and in settlement of its debts issued a large quantity of bonds, called "billets de caisse." These came into general use as the currency of New Orleans and interfered with the king's coin to such an extent that Governor Perier found it necessary, towards the end of 1731, to issue a proclamation in which he fixed the time that those 'T)illets" should cease to be used as currency and should be withdrawn from circulation. Any one convicted of dealing in them as currency was subject to a tine of $4 for the first offense and corporal punishment for a second offense,—a law which will give some idea of the paternal government then prevailing in Louisiana and the deep knowledge of finance that existed then. The Perier law had the natural effect of greatly depreciating these "billets," which at that time constituted the principal currency of Louisiana, and resulted in withdrawing them from circulation. Then followed, as a natural consequence, because of insufficient currency—for there was very little coin in Louisiana at the time—a financial crisis which brought great distress upon the colonists. Many of them emigrated and for a time it looked as though Louisiana and Xew Orleans would be deserted, as the result of the unfortunate commercial and financial policy which the French government was endeavoring to force on them.
The government sought to relieve the financial crisis it had itself caused by the issue of a special currency designed for Louisiana. Many coins have been dug up, from time to time, with the excavations made in New Orleans; but these coins were few and insufficient for the commerce of the colony. In 1735 the government endeavored to replace the depreciated paper money of the India Company (the billets de caisse) by pasteboard notes (known as billets de carte), which it was said would be worth a great deal more, as they had the government behind them as a guarantor instead of an irresponsible company. This change was vigorously opposed by Governor Bienville, but insisted on by the government and put in operation. The new notes did command a better value at first, but they gradually depreciated when the colonists found that there was no means of redeeming them; and all the punitive laws passed to strengthen them proved of no avail. The billets de carte steadily went downward until, in 174-1, nine years after their issue, they were worth only 33 cents on the dollar.
The Council of State was called together to consider the situation and see
what could be done to remedy the evil. It declared the condition of affairs prevailing to be prejudicial to the finances of the government, the welfare of the colony and the progress of commerce. It was therefore determined to call in all the pasteboard notes, redeeming them at 40 cents on the dollar, which was slightly higher than their current value. How thoroughly bad, if not dishonest, were the financial ideas then in vogue, is shown in the redemption of these billets de carte; for the Council of State, instead of paying cash or coin for them, gave in return drafts on the Treasury in France; in other words, the colonists upon handing in the notes were paid off not in New Orleans, but given orders on Paris. This was a large discount on these drafts, because of the delay and the difficulty of cashing them. It was further proclaimed that all the bills not presented within two months of the proclamation should be null and void, and valueless, and could not be accepted in payment of any debt. Thus the colonists were twice fleeced with depreciated currency,—first by the company which settled Louisiana and founded New Orleans, secondly by the government itself.
In spite of these failures, only five years elapsed before Governor Vaudreuil, on his own responsibility, issued an entirely new paper currency. Finding the revenues not sufficient for the support of the colony and receiving no assistance from the home government, France, he, at the suggestion of the Intendant Commissary, Michel de la Eouvilliere, and to the gratification of the wishes of many of the colonists who found the currency too limited for the needs of commerce, manufactured and placed on the market a large amount of paper money, ranging from twenty livres ($4) up. These notes were given in payment of all the expenses and debts of the colony and were made exchangeable for all other paper money, obligations and bonds, in the hope that they would speedily become the only currency of Louisiana.
The action of Vaudreuil and de la Eouvilliere was at once repudiated by the home government, and the new notes were ordered retired. Governor Vaudreuil's attention was called to the fact that the two previous issues of notes had resulted most unfortunately; and to the further fact that the governor of Louisiana had no power or authority to issue paper notes; and that none of his predecessors had ever thought of doing so. The confusion resulting from this illegal issue of paper money was further intensified by the discovery that a very considerable proportion of the new notes in circulation were counterfeits. They were of the crudest character, and an investigation into the counterfeiting disclosed the fact that a negro by the name of Joseph, had been largely instrumental in turning out this
first bogus money. Such was the history of finance and banking in Louisiana under France,—a succession of gross blunders and outrages, which kept the currency always at a discount, proved a millstone around the neck of commerce and upset and disturbed all values; in fact, the same wild policy which ultimately bankrupted the mother country (France) and brought on the Revolution, was tried in Louisiana.
France left the currency in Louisiana in a thoroughly unsettled condition when it transferred the colony to Spain. There were in circulation 7,000,000 livres of paper money issued by the French government and for whose redemption it was responsible. As France drew out, it left this currency with an uncertain standing. The colonists could not know whether the Spanish government would, as the successor of France, accept it or reject it altogether. If Spain redeemed it, it was impossible to say whether that government would take it at par or at a discount of 25 per cent, which the French government had established as the legal amount of its depreciation. In ordinary business, four dollars in paper currency represented one dollar in specie. The matter was laid before Governor Ulloa by the Intendant Commissary, Foucault, and it was pointed out to him what confusion and loss would result of Spain established a new currency and neglected the French currency in general circulation. Ulloa wisely realized that the disfavor with which the Spanish rule was received would only be increased by interfering with the currency and ordered the French paper to be received by the Spaniards as well as the French, at the rate of 75 per cent on its face value. The colonists, however, were not satisfied with this and attempted to make the new government give more than the old one had given and demanded par for their paper. Ulloa, in the policy of conciliation he had determined on, bought up a large quantity of this paper money at 75 cents on the dollar and tendered it to his Spanish soldiers, paying them two-thirds in cash and one-third in Louisiana paper; but the troops refused to accept the paper; and Ulloa, finding both the French (or Creoles) and the Spaniards unwilling to adopt this financial policy, was compelled to abandon it altogether.
Under the Spanish government the financial system slightly improved and a great deal of coin (almost exclusively silver) found its way from Mexico to Louisiana; but the Spanish government also issued a large quantity of paper money, called "liberanza" for the redemption of which no provision was made, and which soon depreciated in value, like all such currency had done in the colony. When Spain pulled out of New Orleans and transferred Louisiana to France, to be sold to the United States, it made no provision for taking care of tliis paper issue, which shrunk in value to almost nothing.
It will be seen from this brief recital of the financial history of Louisiana under French and Spanish dominion, there was really no such thing as banking, that the currency was all the time in a more or less disturbed condition, and most of the money at a great discount; that there was never sufficient currency for the needs of the colony, and that the power in authority, whether the Mississippi or India Company, or the French or Spanish government, devoted itself to fleecing the colonists as much as possible, by issuing unlimited paper or pasteboard currency and then redeeming it at one-third or one-fourth of its face value.
With American rule came a complete change. When Governor Claiborne took possession of Louisiana for the United States, he found the Territory suffering from a depreciated and insufficient currency. Largely through his instrumentality, the Louisiana Bank was founded, in 1804,—the first bank ever to be established in New Orleans. Its officers were Evan Jones, an American, as president, and Paul Lanusse, a Creole, as secretary, the desire being to unite the two races which made up the population of Louisiana at that time, in this financial venture. Commissioners were appointed to lay before the merchants and people of New Orleans the purposes of the bank and to solicit subscriptions to its stock. This required much delicacy and judgment, because the rule of American government at that time was not popular with the Creoles, who resented the fact that Louisiana was kept under Territorial government instead of being granted full legislative power. When it became known that the bank proposed to issue paper notes, there was a loud protest from the more ignorant classes, who recalled the many disasters that the colonists had met with under Bienville, Vaudreuil and Ulloa from a paper currency.
The commissioners, however, paying no attention to this popular clamor, went to work to organize the Louisiana Bank. They decided, first of all, not to take stock in, and thus it become a part of, the Bank of the United States, which, from its headquarters in Philadelphia, was endeavoring to establish a branch in New Orleans, as a branch here would enable it more or less to control the finances of the new acquisition of Louisiana and the Mississippi Valley. In the resolutions in which it was decided not to join fortunes with the United States Bank, it was recited that "the Bank of the United States is owned by Europeans altogether, by persons residing some thousands of miles from this country. * * * Whereas the Louisiana Bank, being owned altogether by inhabitants of this country, all the profits which it may make will de divided among them and remain in this countrv."
The bank was formally organized in January, 1805, with Paul Lanusse, James Pitot, Julien Poydras, Daniel Clark, Michel Fortier, John Soulie, Thomas Harman, Thomas Urquhart, William Donaldson, John F. Merieult, Francois Du-plessis, James Garriek, John McDonogh, John B. Labatut and Nicholas Girod as directors, and with the following officers: President, Julien Poydras; cashier, Stephen Zacharie; tellers, James Fitzgerald and John Thibaut. It would have been impossible to have scoured a better list of names in Xew Orleans for directors and officers of the new bank. The president, Julien Poydras, was the most prominent and wealthiest man in the French colony, as was John McDonogh among the Americans. Clark was the delegate of the Territory in Congress. Pitot was mayor, as Girod was afterwards. It will be seen that the directors were divided among the French and American elements, the former being in a majority, as they constituted a majority of the population and merchants and business men of Xew Orleans at that time.
At the same time, 1805, that the Louisiana Bank came into existence, the United States Bank, of Philadelphia, succeeded in establishing its branch in New Orleans, with Evan Jones, originally the president 'of the Louisiana Bank, at its head. The local directors in 1805 were Evan Jones, Benjamin Morgan, Thomas (.'allender. John Palfrey, Whitten Evans, J. B. Prevost, William Brown, Cavalier Jcnnier, Beverly Chew, John W. Gurley, Joseph McNeill, William Ken-ner and George T. Phillips. It will be seen, at a glance, that while the Louisiana Bank was attempting to unite the Creoles and Americans in financial matters, the branch of the L^nited States Bank was distinctly and exclusively an American institution, which took little account of the native French population of Louisiana.
The Louisiana Bank was not a success.- Considerable difficulty was encountered in its management, and in 1810, fourteen years after its establishment, it was decided to go into liquidation. At that time the assets were $777,993, and the liabilities $821,547; and it was announced that the stockholders would not lose more than 11 or 12 per cent of their capital, "provided no more notes of a fraudulent emission sliould bo presented,"—a provision of which no explanation was ever given. and the meaning of which is therefore completely incomprehensible to-day. The liquidation of the bank took a much longer time than was expected, and two extensions had to be granted, the settlement of the bank's affairs not being completed until March, 1823.
Before the failure and retirement of the Louisiana Bank, other and stronger banking institutions had sprung into existence in New Orleans, which continued
np to tlie time of the Civil War, and (lisapiiciirei! then diily tliriiu,!j;h the fortunes of war. The first of these was the Bank of Orleans, estahlished under an act of the Louisiana Legislature in 1811, with a capital of $.3,0()(),00(). The first board of directors included E. D. Sheperd, William Kenner, Benjamin Morgan,'William Nott, John Taylor, Daniel Olivier, D. Eonquette and Thomas B. Williams. An evidence of the peculiar commercial and financial conditions prevailing in New Orleans at the time and the lack of facilities such as exist to-day in the commercial exchanges, is given in the fact that the subscription book for the stock of the bank was left open for subscriptions for some time at the Commercial coffee-house,—the coffee-houses, or, as they called themselves, "exchanges," being the places where "merchants most did congregate " and where most of the commercial transactions of the period occurred.
The first president of the Bank of Orleans was Benjamin Morgan. He was followed by Samuel Packwood and the latter by Zenon Cavalier. Upon the expiration of its charter, a new charter was obtained, the bank securing exemption from the payment of State taxes by paying a bonus or lump sum of $35,000.
The Louisiana Planters' Bank was organized the same year as the Bank of Orleans, 1811, for the convenience of the agricultural interests of the Territory. It made a specialty of discounting the notes of planters and advancing money for the improvement of agricultural property. Its directorate, therefore, included a number of the more prominent planters in Louisiana, mainly those engaged in the sugar industry,—Colonel Bellechasse, A. D. Duplantier, D. de la Croix, William Donalson, Jacob Trimble, James Johnston, S. Hillen, S. Henderson, P. Foucher, W. W. Montgomery, N. Cox, E. Butler, John Grieve and Samuel Packwood.
These three banks—the Louisiana Bank, the Bank of Orleans and the Planters' Bank—were amply sufficient for the financial needs of Louisiana for the first two decades under American rule; indeed, considering the fact that Louisiana had previoufsly been without any banking facilities at all, they would seem to be more than enough. They did all the business of New Orleans and the region tributary to it for the fifteen years that followed the annexation of Louisiana to the United States. In 1818, however, when the Louisiana Bank was on its last legs and preparing for liquidation, the State—for the Territory had become a State in the interim—was far more ambitious in its banking ideas, and the Louisiana State Bank, which was provided for by the Legislature to take the place of the Bank of Louisiana, was established on far greater foundations than anything that had been seen before in New Orleans. The new institution was quite colossal in its
proportions. The capital was fixed at $2,000,000. Subscription books were opened at Xew Orleans imder the supervision of five managers and under three managers at each of the following places: Donaldsonville, St. Francisville, Alexandria and St. Martinville. The capital of the branch bank at St. Francisville was fixed at $200,000, while the Alexandria, St. Martinville and Donaldsonville branches had each $150,000 capital. The bank, in fine, was not a New Orleans one alone, but a State institution with no less than five different banks located in the richest and most prosperous portions of the State, but united under one common management. The first directors included F. X. Martin (chief justice of the State), L. B. Macartj', E. J. Forstall, I. Eoffignac (mayor of Xew Orleans), A. Chopin, John K. West, Henr}' McCall, Charles Harrod, H. Foster, M. Duralde, G. R. Stringer and John B. Dibley. The governor appointed as directors Dusnau de la Croix, Samuel Paxter, John Poulleney, Jr., Bernard Marigny, A. L. Duncan and Etienne Bore (one of the first mayors and the first producer of sugar in Louisiana). The bank being a State institution, in which the State of Louisiana was interested, the governor was entitled to appoint six of the eighteen directors, and he chose them from among the most eminent men in Louisiana, so that its directorate is a roll of honor, including senators, representatives, mayors and even future governors.
The banking business in New Orleans at that time was in a thoroughly satisfactory condition, and it was not until more than a dozen years afterward that the spirit of speculation and inflation seized on Louisiana and indeed the whole South and West, and led to those financial excesses that brought on the great panic of 1837.
The Louisiana Bank had gone down in 1818, aud had completely wound up its affairs in 1823, after two extensions granted it by the Legislature for the purpose of facilitating liquidation. Soon after its closure the Bank of Louisiana was incorporated, in April, 182-1. It was the largest of any of the lianks yet established, with a capital of $4,000,000,—many times greater than any institution of the kind existing in New Orleans to-day. It was modeled upon the same style as the (Louisiana) State Bank mentioned above; that is, the State was interested iin it and had a part of the stock. It maintained more or less control over the bank, the governor appointing nearly half the directors, six out of thirteen. This practice prevailed in nearly all the early banks of New Orleans. The position was taken by the Legislature that the State was interested in the banking business, that it should facilitate the people in every possible way, especially by providing the capital necessary for the development of their resources, and that its partici-
pation in the management of the bank tlirough directors appointed by the governor, would prevent speculation or wild financiering. The State's subscription to the bank was $2,400,000, divided into four equal proportions of $600,000, made in bonds bearing 5 per cent interest, falling due in 10,15, 20 and 25 years respectively. Branch offices of discount and deposit were established at Baton Eouge, Alexandria, Donaldsonvillc and St. Francisville, each with a capital of $200,000, on which they were to pay the mother bank 6 per cent.
The charter of the bank continued until 1870, and contained a number of very stringent provisions. It provided, for instance, that the bank should at no time suspend specie payment on any of its notes, bills or obligations, or on any moneys received by it on deposit, under penalty of paying 12 per cent on these obligations until tliey were paid in full.
The seven first directors chosen by the stockholders were Samuel Livermore, Andrew Lockhart, Samuel F. Oakey, William Brook, James Hopkins, Samuel B. Bennett and J. M. Fortier, with Benjamin Story as president and Joseph Saul as cashier.
The Consolidated Association of the Planters of Louisiana, an institution which it took so many years to liquidate because of the large amount of real estate it held and whose liquidation was completed comparatively a few years ago, was organized in March, 1827, with a capital of $2,000,000, which was to be obtained by means of a loan, by the directors of the institution, based on the real estate put into it by subscribers. It was, therefore, a land bank with plantation property as one of its principal assets. Subscription books were opened by five commissioners for $2,500,000, each share to be $500. The books were to remain open for six months and planters only were permitted to subscribe to the stock. ,In order to procure the loan of $2,000,000, upon which the bank depended for capital, bonds were issued bearing 5 per cent interest, payable in equal proportions in five, ten and fifteen years, the bonds being secured by mortgage on real estate, for an amount equal to the shares to which each stockholder subscribed. It will be seen that the association or bank—for it was a bank, although not so called—was an ingenious plan whereby the planters of Louisiana who were in need of money to improve their property and to purchase slaves for its cultivation could obtain the necessary capital. They subscribed to the stock of the association, putting into its capital so much real estate as equaled in value their subscriptions. Upon tliis security, which was supposed at the time to be the best possible, as real estate was high and improving in value because of the success of the cotton and sugar industries, bonds were issued
with a mortgage on the real estate as security. Tlie bonds were sold and produced the necessary capital, from which the planters could draw such money, in loans, as they required for their improvements. The circle of credit was therefore completed and the only danger to the bank lay in the possibility of the crops failing, agriculture decaying and the land declining in value,—something which the planters of that day did not believe possible, so great was their confidence in King Cotton, just then coming to his full power and strength. As in the case of the Bank of Louisiana, the State was appealed to and asked to take an interest in the new bank, on the ground that the prosperity of the planters was the prosperity of Louisiana. It did so in 1828, when the capital of the association was increased to $2,500,000, the State being recognized as a stockholder to the amount of $1,000,000, and pledging itself for the reimbursement of the capital. Thus $1,000,000 of stock was received by the State as a bonus, upon which it was allowed a credit of $250,000; that is, it could borrow that amount from the bank, paying interest thereon, upon any part of this credit it might use.
The success of this plan of raising money for the development of the planting interests of Louisiana led to the formation soon after of a number of improvement banks with specific improvements in view. Several of these survive to-day, but very much modified in form. The Gas Company, for instance, is a relic of one of these old improvement companies, the banking part of the institution having disappeared, while the gas-works survive. The reverse is the case with the Canal Bank, established to construct the new canal. Here the banking feature survives, in one of the largest and soundest financial institutions in New Orleans, whereas the improvement to carry out which the bank was founded has severed company with it, is now whdly independent, the property of the State of Louisiana, and managed by a board of control appointed by the governor.
The New Orleans Gas Light Company, the first of these improvement banks, was incorporated in February, 1829, with a capital of $100,000, which could be increased to $300,000 if deemed advisable, for "the purpose of introducing into the city of New Orleans and its fauxbourgs (suburbs) the use of gas-light. Its charter was for twenty-five years. The company failed to comply with its charter and the franchise was transferred to James H. Caldwell (who may be regarded as the father of gas in New Orleans) and his associates, who were given a monopoly of supplying gas to the city and its fauxbourgs St. Mary (now the first district of the city) and Marigny (now the third district) for a period of twenty-five years, provided they put their system in operation within two years.
Mr. Caldwell was successful in his enterprise, but after he had succeeded in lighting Ne\y Orleans with gas—to the great delight of its population, for it was one of the first cities so illuminated in America, while most of the others were struggling on in the gloom of oil lamps—he was not satisfied with the charter under which he operated and asked for a new and grander one. It was an era of inflation just then, an era of grand and extravagant ideas, and New Orleans was at the height of its "flush times." A gas company with only $300,000 capital, and its business confined to the narrow limits of supplying New Orleans and its suburbs with gas, was too insignificant for the conditions then prevailing. Mr. Caldwell, therefore, asked in 1835 that the charter of his company be amended, or rather that it be entirely repealed and a new charter granted; and with the success he had met with he had only to ask anything to have it granted. The New Orleans Gas Light Company disappeared, to make way for the New Orleans Gas Light and Banking Company; the capital was increased from $300,000 to $6,000,-000, and the company was required to establish five branch banks and gas companies —for a division or apportionment of all privileges and franchises to the several sections of the State, was provided for in all the legislative acts of the time—in Port Hudson, Springfield, Napoleonville and Harrisonville, each with a capital of $300,000, and in Alexandria with a capital of $800,000. The selection of the places for the branches is somewhat extraordinary and shows a lack of foresight. With the exception of Alexandria, all the towns mentioned were insignificant then, and none of them, even at this day, 65 years afterward, have reached a population of 1,000. The charter of the Gas Bank, as it was called, was loaded with various other conditions in the interest of certain sections of the State, which seem onerous viewed from the standpoint of to-day; and the bank, in order to secure the privileges it asked for, was required to assist other struggling improvements then under way or contemplated. It was required, for instance, to subscribe to 500 shares of the stock of the Barataria and Lafourche Canal Company, and also to loan money, up to $150,000, to any railroad company which might be incorporated by the Legislature of Louisiana after March 20,1835, for the purpose of building a railroad from Alexandria to Cheneyville on Bayou Boeuf,—the loan to run 25 years and bear 5 per cent interest. These conditions will illustrate the financial conditions and opinions of the time, and the boom just then imder way for public improvements. A company is started for the purpose of constructing gas-works in New Orleans. It is not satisfied with this, but wants to run a banking business along with its gas-works, and is allowed to do so, on the condition that it will establish
five branch banks in various parts of the State, four of them in insignificant villages; that it will furnish the capital necessary for the construction of a canal in another part of the State, and a railroad many miles distant and of purely local interest—the possibility of railroad building at that time being an unknown quantity. The charter of the Gas Bank also contained the provision usually inserted in the banking corporations in Louisiana at the time and intended to give stability to these institutions, forbidding it to suspend specie payment on any of its obligations. In the event that it did so, it was required to pay 10 per cent interest on its obligations for a period of 90 days. Suspension for over 90 days rendered the charter of the company ipso facto null and void.
On the other hand, the bank was given a monopoly of lighting with gas the cities of New Orleans and Lafayette (now the fourth municipal district), but was subject to a fine of $500 per day for its failure to light the city, and $25,000 for any failure to provide the Charity Hospital with free gas.
Various other amendments were made from time to time in this charter, and the Legislature seemed determined to load the Gas Bank down with obligations. It was required to establish another branch in St. Bernard, with a capital of $100,000, and still another in Franklin, with a capital of $300,000; and the Alexandria branch was authorized to retain $250,000 of its capital to be loaned to citizens of Natchitoches and Claiborne parishes. In fine, the New Orleans (Jlas Light and Banking Company seems to have combined a half dozen institutions,— gas company, bank, loan institution and improvement company. Ultimately tliese side issues were separated from the Gas Company, which has continued to this day, but confining itself exclusively to its legitimate business of providing New Orleans with gas.
The next few years saw a flood of new banks and corporations. It was what would be called to-day a "boom," and brought the natural consequences of a reaction, collapse and panic. The new banks were of immense capital, far greater than the commerce of New Orleans and the development of the tributary country required. It was a case of pushing a good thing along too far, and in the crisis which followed some of the old banks went down as well as the new ones. The banks established between 1831 and 1833 were as follows:
March 3, 1831, City Bank of New Orleans, capital $2,000,000. ]\Iarch 5, 1831, New Orleans Canal and Banking Company, capital $4,000,000. It, or rather its successor, survives to-day in the Canal Bank. April 2, 1832, Union Bank, capital $7,000,000. This bank survives to-day in the Union National Bank. April 1, 1833,
Commercial Bank of New Orleans, capital $8,000,000. April 1, 1833, Mechanics' and Traders' Bank, capital $2,000,000. April, 1833, Citizens' Bank, capital $12,-000,000.
Thus in barely two j'cars si.x new banks had been authorized in New Orleans— three of which survive to-day after many vicissitudes and changes in their charter—with capital to the amount of $33,000,000. Could there be better evidence of overdoing the banking business? In 1835 the Legislature granted five more banking charters: The New Orleans Gas Light and Banking Company (of which mention has already been made and which was merely an amplification and modification of the Gas Company), capital $6,000,000; E.xchange Bank, capital, $2,000,000; Carrollton Eailroad Bank, capital $3,000,000. The latter survives in the New Orleans and Carrollton Railroad to-day. It was thought necessary, it will be seen, to extend the banking privileges to canal and railroad companies. The total capital of new banks established in New Orleans in 1835 was $16,000,000, aggregate capital of the banks and other similar institutions chartered by the Legislature at its twelfth session (that of 1835), $39,345,000. The success that had been met with had started the State on a policy of wild inflation almost as great as that of Law, which had marked the foundation of the colony of Louisiana a century and a half before.
Of these several new banks only brief mention is needed.
The City Bank of New Orleans was incorporated March 3, 1831, with a capital of $2,000,000 and with Nathaniel Cox, John A. Merle, Martin Duralde, George Eustes, Stebbins Fisk, J. J. Bordier, A. H. Wallace, F. Gardere, James P. Frcret, Joseph Lallande, A. Cruzat and D. S. Borderzat as directors. It was authorized to establish two branches of discount and deposit at Natchitoches and Baton Rouge, respectively, each with a capital of $200,000 and five directors. There was the usual provision inserted in bank charters at the time, relative to the suspension of specie payment, interest of 12 per cent on all such suspended papers and the forfeiture of charter in the event that the suspension lasted longer than ninety days. The City Bank was one of those that suspended payment in the great panic of 1837, but it was renewed afterward, and it was not until March, 1850, that it passed into liquidation under an act of the Legislature.
The New Orleans Canal and Banking Company was one of the improvement banks, chartered for the construction of -i canal in the newer or American portion of the city, to which trade and business was at that time rapidly drifting from the old city, the vieux carre. It was chartered March 5, 1831, with a capital of $4,000,-
000 under the superintendence of 17 commissioners; and it was authorized to establish four offices of discount and deposit, one at St. Francesville, one at Alexandria, with a capital of $4,000,000, one at Franklin and one at Donaldsonville, each of the latter two with a capital of $250,000.
The Canal, in the construction of which Hon. Simon Cameron, afterward Senator from Pennsylvania and U. S. Secretary of War under Lincoln, was employed, was completed in 1839, although at great cost and with more difficulties and obstructions than the company had anticipated. The canal and banking privileges were subsequently separated, the former passing into the hands of the State, which still holds and controls it, while the banking franchise is now operated by the Canal Bank.
The Union Bank was incorporated April 2, 1833, with a capital of $7,000,000, to be raised by means of a loan negotiated by its directors. The faith of the State was pledged for the security of the capital and the guarantee of interest, and $7,000,000 of bonds were issued, bearing five per cent interest, one-quarter being payable each 12, 1.5, 18 and 20 years. The bonds issued by the State were secured by the stockholders' subscriptions. These were to be in cultivated lands and slaves, lots or houses, or other edifices yielding a revenue, or on lands not cultivated but susceptible of cultivation, and in vacant lots, provided that no more than one-fifth of said stock should be secured by such lands. No mortgages or slaves alone were received; they must be slaves as part and parcel of a plantation. It will be seen that the Union Bank was founded on much the same principle as the consolidated Planters' Association, except that the security was slightly broadened. The Planters' Bank would take none but plantation property; the Union Bank included city as well as country real estate, houses and lots, as well as plantations—in fine any kind of real property, not even excluding negro slaves, at that time one of the most valuable assets in Louisiana.
The charter of the bank gave it an existence of 25 years. It was to be operated by 12 Directors, of whom six were to be appointed by the Governor in view of the direct interest the State had in the bank, in consequence of supplying the bonds upon which its capital was based, and six elected by the stockholders. There was the usual provision in regard to branch banks or depositories, but the Union Bank was authorized to establish eight of these, more than any of its predecessors. These branches, with their respective capitals, were as follows: Thibodaux, $250,000; Covington, $225,000; Marksville, $220,000; Yermillionville (now Lafayette), $200,000; St. Martinville, $200,000; Plaquemine, $250,000; Xatchitoches, $200,-000; and Clinton, $250,000. Each of these branches were in charge of local boards of directors, consistins of five or seven members.
The Union Bank, whose president was Matthew Morgan, was for the first four or five j'ears of its existence one of the most prosperous of the financial institutions in New Orleans, and during a considerable part of that time handled the large business of the New Orleans branch of the United States Bank, which was just then going out of business. It figured very conspicuously later on in the troubles incident upon the capture of New Orleans by the Union forces in 1868.
The Commercial Bank of New Orleans, like the New Orleans Gas Light and Banking Company, was an improvement bank, organized for the purpose of providing New Orleans with water, and practically survives to-day in the New Orleans Water Works Company. It was incorporated April 1, 1833, with a capital of $3,000,000, and with five commissioners or directors, three of whom were to be appointed by the Governor and two by the City of New Orleans. The bank was required to furnish the city with free water for the extinguishment of fires, as well as for the public squares. On this score frequent complaints were made and the Legislature of Louisiana found it necessary in 1848 to pass a special act compelling the bank to carry out its obligations to the city in the matter of supplying it with such water as was needed.
The Mechanics and Traders' Bank was incorporated April 1, 1833, with $2,000,-000 of capital. It had but one branch, at Opelousas, with a capital of $300,000. The State subscribed for $150,000 of the stock and the privilege of The other banks, it will be noticed, were organized mainly for the benefit of the planting interests of Louisiana, or for public improvements. The manufacturing and mechanical interests of New Orleans were but little thought of, and, indeed, viewed with more or less contempt. The Mechanics and Traders' Bank was founded largely for the purpose of developing these interests. The men who were mainly instrumental in organizing the bank were Jedediah Leeds, James McKenna, John Wilcox, Maurice Cannon, Nicholas Sinnott, James B. Hullen, Jesse Cowand, John D. Bair, Maunsel White, Evarste Blane, James Hopkins, John G. Greeves, George W. White, Maurice Pizetti, Claude Gurley and C. Corryjolles, Jr. The liquidation of the bank was authorized in 1850.
The Citizens' Bank of Louisiana was chartered in April, 1833. It was the largest and most important bank yet provided for, and started out with the immense capital of $12,000,000, based upon a plan of loans or bonds to be issued by the bank. The amount to be subscribed for by the stockholders was $14,400,000 in 144,000 shares of $100 each, to be guaranteed, secured and pledged by mortgages on real estate. Upon these subscriptions the l)ank was authorized to issue bonds, payable
in 14, 23, 32, 41 and 50 years. The subscriptions were to be divided between New Orleans and the country districts as follows: New Orleans, $8,400,000, and the country $6,000,000.
The bank was a "boomer"' from the start, and gave great impetus to the improvement of plantations, the building of houses, etc. As one of the historians of the times writes: "Every owner and proprietor of a vacant lot, whether dry or under water, every proprietor of old and tenantless buildings imagined that tlie millennium was really approaching"' and hastened to subscribe to the "stock." The bank was authorized to advance money for the building of houses, prescribing of what material they were to be built, to take stock in the Lake Borgne Navigation and Canal Company, to build a railroad from the river to Gentility Eidge and to do a hundred other things—"enough to bankrupt the best bank in the world"—an able financier of the times remarked.
The Citizens' Bank did not enjoy the same advantage as the L'nion Bank, wliich had the credit of the State behind it, whereas the Citizens' Bank had as its security only lands and property in Louisiana. When, therefore, its agents went to Europe to arrange for the negotiation of its banks, as had been so successfully done by the Union and other banks, they encountered several rebuffs, and were unable to place the bonds. The State was several times appealed to and asked for its guarantee, but refused at first. In 1836, however, the Legislature assured the Citizens' Bank the assistance it asked for. It was just on the eve, however, of the great panic. The Citizens' Bank did only a few years' business, for it went into liquidation in 1843, to be reorganized afterward on a new basis. Under its charter it was authorized to establish seven branches in various parts of the State.
The New Orleans Improvement and Banking Company was incorporated February 26, 1834, for the purpose of purchasing and selling real estate. The capital, originally $1,000,000, was increased to $2,000,000 in 1836. This Company built the first St. Louis Hotel, the finest hotel of its time; but one of the conditions of its charter—there were remarkable addenda to charters then—required it to build three steamboats to run on the Red Eiver, Upper Coast and Lake Pontchartrain trades respectively. The Legislature selected the Directors of the company, who wore J. F. Canonge, Alonzo Murpliy, Felix de Armas, Henry F. Denis, F. Gardere, E. J. Forstall and Noel Barthelemy Le Breton. This company went under in the panic and was compelled to liquidate its affairs in 1846.
The Atchafalaya Eailroad and Banking Company was incorporated March 10, 1835, with a capital of $2,000,000, to build a railroad from Pointe Coupee, in the
Mississippi River, to Opelousas. The company had its headquarters at B:iyou Sara, with branches at New Orleans and Monroe, the former with a capital of $500,000, and the latter with $400,000.
The Exchange and Banking Company of New Orleans was incorporated April 1, 1835, with a capital of $2,000,000, to build a hotel in the new or American section of the city. The hotel was to cost not less than $300,000, exclusive of the sites, under a penalty of a forfeiture of the Company's charter.
The Merchants' Bank of New Orleans was incorporated February 25, 1836, with a capital of $1,000,000.
The slightest consideration of the conditions prevailing in Louisiana at that time will show that the banking business had been overdone. This was due to the ease with which bonds could be floated, and the assistance the State of Louisiana gave the banks by lending them its credit and guaranteeing their bonds and interest thereon, apparently safeguarding itself by the securities furnished by the subscribers, who put their property—plantations, houses and slaves—into the new companies. It was pretty much the same condition of affairs that preceded the Argentina panic of a few years ago, which resulted in the suspension of the great English banking house of Baring Brothers.
It would be a mistake, however, to imagine that Louisiana and New Orleans were alone in going beyond their credit, and in placing more securities on the market than they could handle. The same condition of affairs existed throughout the South and West, more particularly in the latter section. The ease with which bonds and securities of all kinds could be floated in Europe was a temptation. Every town and county issued bonds, and companies were organized for every conceivable improvement. The total amount of securities sold in Europe ran far up in the hundreds of millions and swallowed up all the available capital of that continent.
New Orleans had been somewhat moderate at first, but from 1830 to 1837 it was attacked by the prevailing epidemic, and was turning out new banks by the dozen. In 1837 it boasted of no less than fifteen banks, capitalized at $02,000,000, enough to do more than five times the business the city then handled.
The panic was threatening long before its danger was recognized in New Orleans, or, indeed, anywhere else. The failure of the United States Bank to secure the renewal of its charter in 1833 was the first warning note. This stimulated the several States Legislatures to grant charters for State banks, which increased in number with marvelous rapidity, each of these banks being authorized to issue currency, and the Legislature in many of the States having taken no sufficient steps
to protect this currency, the coimtry was flooded with notes. There was more money than was needed, not only in New Orleans, but everywhere else, and there was naturally a great deal of speculation and a rise in values, particularly real estate. Towns were laid off and gigantic improvements planned. In fine, the United Status was enjoying one of the wildest booms which it ever knew, and as it had had very little experience in "booms" all this improvement and advance in price was greeted enthusiastically as evidence of great prosperity.
The imports were above the exports, and there was a steady balance of trade against the United States, which, however, was not felt at first because many of the States issued bonds, and these almost settled the balance against us. This method of business could not be carried on forever, and when, in 1837, conservative people, aroused at the overtrading and speculation that prevailed, demanded specie instead of bank notes, the crash came. Exchange on England ran up to 20 or 25 per cent, and the newer banks and companies began to go down before the storm.
The panic was worse in the West and Southwest, where the greatest proportional amount of banking capital had been created. New Orleans, which was then the financial capital of the Southwest, was naturally one of the worst victims; and the situation in this city was aggravated by the fact that about the same time that this financial flurry came upon the country the region tributary to New Orleans suffered from other causes, changes in the tariff unfavorable to sugar and other crops grown there and injury from crevasse and overflow—3840 was the worst flood year known up to that time.
The panic struck New Orleans May 13, 1837, when there was a run on the banks of the city, and fourteen of them, all save the Merchants' Bank, suspended specie payment, thereby forfeiting their charters under the conditions contained therein, that any suspension of specie payments for more than ninety days should, pro facto, wind up their affairs. For the next eight years the Legislature worked on this problem, finally succeeding in building up a new banking system and framing a banking law that was a model of its kind.
How to do in the meanwhile, however, was a difficult problem. The city had been suffering from a plethora of currency; it found itself, by the suspension of the banks, without enough to carry on its legitimate business. In this emergency, and in order to afford the community some relief, even if temporary,the three municipalities which then constituted the city of New Orleans, issued bills from the value of one bit (12^ cents) to four dollars, which were put in circulation. Then followed an era of "Shinplasters," as they were called, a number of companies, and
even private individuals, claiming the same privilege, so that the State was flooded with "rag money."
The Legislature appointed a commission to examine into and report upon the condition of the suspended banks. In 1839, however, the banks had resumed specie payments, and the Legislature, recognizing that their suspension was not due to local causes or any mismanagement on the part of their officers and directors, but "the result of a general derangement of the monetary system of the country," reinstated them in their chartered rights and privileges. This resumption of specie payment, however, was only temporary. The banks were still badly involved. They had issued large quantities of notes and their securities were difficult to realize on, while in many cases the property upon which money had been loaned was only a fraction of the value given it, and often altogether unsalable.
This financial crisis continued for practically eight years in New Orleans, from 1837 to 1845. During that time legitimate commerce, the handling of the produce of the interior and its shipment to market, continued as large as ever, but under some inconveniences, in consequence of the disarrangement of financial matters. There were many failures and bankruptcies of'firms and individuals, and a large proportion of business houses in the Southwest and West had to take advantage of the Federal bankruptcy law of 1842 to get on their feet again.
The run on the banks and their suspension came, as already stated, in May, 1837, but they resumed specie payments in 1839. The Associated Banks of New Orleans then reached an agreement for a general interchange, by which the notes of all the banks obtained an equal currency in the market, all of them being bound to sustain this circulation. It was a union whereby the stronger banks sustained the weaker ones. This rule was not formally repealed until February, 1843. It was a temporary expedient which resulted in the end in loss to the public, for the notes of the weaker banks remained in circulation, while those of the stronger ones were being retired.
At the beginning of December, 1841, the depreciation in bank paper was from three to four per cent, and by March 1, 1842, even the paper of the strongest and best ba'nks had gone down to seven or eight per cent. This was brought about largely by a law requiring the banks to resume specie payment on a fixed date. On March 2, 1842, notes of the Exchange Bank were at a discount of from 15 to 25 per cent, and those of the three other discredited banks at a discount of from 10 to 15 per cent.
To meet the condition of affairs prevailing, and to put an end to the financial
embarrassment, the Legislature passed a law restoring the charters of the suspended banks, all of which had been annulled because of their failiire to pay in specie, in which it was provided that in the event they resumed specie payment before November, 18-12, their charters would not be considered forfeited. As it was recognized that the capital of several of the banks had been made much greater than necessary, and as only a very small part of the capital in those concerns had been subscribed, there was a very considerable reduction made. The circulation of the Carrollton Exchange and Improvement Banks was reduced to $250,000 each, that of the Bank of Orleans and the Atchafalaya Bank to $150,000 each. The circulation of the other banks was fixed as follows: Union, $800,000; Citizens', $700,000; Louisiana, $700,000; Louisiana State, $500,000; Consolidated Planters' Association, $500,000; Canal, $500,000; Commercial, $500,000; City Bank, $500,000; Mechanics and Traders', $400,000. The banking laws prepared by a Board of Currency created by the Legislature were not well received with favor in New Orleans, where they were regarded as hostile to the banks; and there was even a public meeting called to protest against them, as threatening the ruin of legitimate business.
When the banks opened for business on February 21, the notes of four of them generally classed as weak—the Orleans, Exchange, Improvement and Atchafalaya Banks—were refused by the others, either in payment or on deposit, which naturally sent these notes still further down, their holders being glad to dispose of them at 30 per cent discount.
The provision of the Legislature extending the charters of the banks on the condition that they resume specie payment by November, 1842, was accepted by five—the Citizens', Improvement, Louisiana State, Consolidated Planters' and Carrollton Banks; but rejected by eleven—the Union, City, Commercial, Gas, Orleans, Canal, Louisiana, Exchange, Atchafalaya, Merchants and Mechanics' and Traders' Banks. The Carrollton Bank accepted the condition for the avowed purpose of going into liquidation. The objection of the banks to the law was for the purpose of testing its constitutionality, and under their pressure the time allowed for the resumption of specie payments was extended to December 1, 1842.
When it became known that the paying teller of the Atchafalaya Bank was a defaulter to the amount of $120,000, and that there were in addition overdrafts to the amount of $70,000, the notes of that institution depreciated 50 or 60 per cent. The Attorney General brouglit proceedings against the bank, as well as against the Orleans and Exchange Banks, whose doors were closed, their notes being quoted at from 50 to 55 per cent discount, and those of the Improvement Bank at from 30
to 35 per cent discount. This action on the part of the State naturally created great confusion and had a most deleterious effect on business.
After considerable finessing the banks finally accepted the act of the Legislature and opened, with one exception, to renew specie payments on December 1. They anticipated that date, however, and began paying out specie in May. This action brought discredit on the notes issued by the several municipalities to the amount of $1,000,000, and which had been the chief currency of the city during the interim. These municipal notes depreciated in value, and as they were held mainly by the poorer classes they caused great popular excitement, resulting in a mob forming and several riotous acts being committed. The riotous spirit was finally quelled to a large extent by the issue of certificates by the municipalities, which were generally taken at a discount of 8 or 9 per cent.
The banks resumed specie payments May 20. The Citizens' and Louisiana Banks again suspended May 29, after a rush on them; the Commercial, Consolidated Planters' and Canal Banks on June 1; the City Bank on June 2; the Carrollton Bank on June 9, leaving only three continuing business—the Union, the Louisiana and the Mechanics and Traders'.
The New Orleans banks imported specie and in December, 1842, it was possible to put into operation the law in regard to resumption. This was further facilitated by the action of the municipalities in settling and destroying a large quantity of their notes.
On June 1, 1843, eight banks—the Louisiana, Canal, Carrollton, City, Commercial, Louisiana State, Mechanics and Traders' and Union—had resumed specie payments, with assets amounting to $6,975,314, while the Citizens' and Consolidated Association, with $359,006 of assets, had not yet resumed. This may be considered as the end of the panic, or at least of the suspension of the banks, for Governor Roman announced in his message to the Legislature (January 3, 1843,) that the banks were in good condition again, having not less than $4,565,925 of specie and an actual circulation of only $1,261,514.
But, although the banks were on their feet again, it took fully three years to restore public confidence and to get rid of those institutions which had fallen by the wayside. The old banking system was at fault, and it was found necessary to construct a new one. Acts were passed to facilitate the liquidation of the insolvent banks, especially the property banks, and to settle the involved relations between the State of Louisiana and such institutions as had received the assistance of its credit. Under the act, passed in 1845, for the adjustnjent and liquidation of the
debts of the State, there was an adjustment of mutual obligations, a renunciation by the State of all interferences in bank management. By this arrangement the State was relieved of about $3,000,000 of indebtedness. The banks also extinguished their bonded debts, and the city of New Orleans retired its depreciated promises to pay. Public credit was completely restored, a sound currency was established and the State Treasury was brought to a most prosperous condition.
These eight years of suspension and financial demoralization, however distressing during their continuance, had a most beneficial efEect. They taught New Orleans safe banking, and the result of this bitter experience was the adoption of a banking system that proved perfect and of a banking law which continued unchanged up to the time of the Civil War, and proved so satisfactory in every way that it was adopted by half a dozen States and even by the General Government in part.
The banking history of the period 1845-1860 is free of incident. There were no failures or suspensions of any moment. When the Civil War came on there were no banks in the country in better condition or more solid than those of New Orleans, as the following table will show, giving their condition on January 1, 1860:
Circulation. Deposits. Specie.
Citizens' Bank .$ 4,089,780 $ 4,262,705 $ 3,416,034
Louisiana State 3,593,775 4,812,483 2,746,644
Bank of Louisiana 736,629 3,640,544 1,588,342
Canal 1,238,365 1,374,795 1,299,305
New Orleans 630,975 1,006,225 629,641
Union 558,200 1,225,865 601,213
Mechanics and Traders' 412,505 920,661 420,632
Merchants' 491,065 522,771 331,909
Southern 305,575 434,819 242,369
Crescent City 283,224 379,936 261,049
Bank of America 240,240 1,188,002 518,387
Total $11,579,313 $19,768,806 $12,055,435
After fifteen years of peace, quiet and prosperity the banks of New Orleans entered, in 1861, upon more serious troubles than those they had undergone during the period 1837-45, when Louisiana seceded and the Civil War broke.out. Although the officers and directors of the banks sympathized with the Southern cause, they felt that their obligations to their stockholders required them to pursue a con-
servative course. They stuck manfully to their charters, which required them to pay in specie; but on September 16 they yielded to the pressure of popular sentiment, which required that they should accept Confederate notes as a proof of their loyalty to the Southern cause. Some of them suspended specie payment in consequence, and those who did not at first, deemed it advisable to do so soon after for their own protection. At that time their condition was still excellent, and they were doing a fair business, in spite of the commercial demoralization that existed. Their circulation was only $6,481,910, or a little over half what it had been a year before, because the banks had deemed it advisable to call in as many of their notes as possible; but on the other hand the specie held by them was $14,-173,258, or more than in 1860. The deposits had shrunk some five millions to $14,710,698, this representing the money withdrawn by timid persons, who feared what the war might bring forth. The Citizens' Bank was still the strongest, with $4,086,819 of specie, while the State and Louisiana banks had each close upon $3,000,000 of specie.
It is doubtful if the bank officials wished to accept Confederate notes; but public opinion, which was very intense at the time, would not allow them to do otherwise. After the suspension of specie payment and the acceptance of Confederate notes, nearly all the business of the city was done with the latter, and the bills of the banks were seldom seen. The banks threw their fortune, willingly or unwillingly, with the Southern cause. They contributed a large amount to the defense fund of New Orleans, and when the forts were passed by Farragut's fleet they sent some $4,000,000 in specie into the Confederacy to prevent its falling into the enemy's hands.
When General Ben F. Butler took possession of New Orleans he became involved at once in an interminable squabble with the bank officials, who found him a very hard customer to deal with. He demanded of them an explanation of their conduct in sending out of the city their specie, which was intended, he claimed, as a protection for the depositors, and several of the presidents admitted that it had been "unadvisedly carried away." An attempt made to secure the return of the specie proved a failure, as the Confederate authorities would not permit its return; but the banks were allowed to transact business upon the basis of this absent coin, "just as though it was in their own vaults."
In regard to the Confederate bonds and notes which had almost completely ousted the bank bills from circulation, it was provided at first by an order issued May 1, 1862, that no Confederate bonds or obligations payable in Confederate
notes should be accepted; but the notes themselves, as they constituted almost the only circulation of the city, were allowed to pass until the financial situation improved. On May 1(5 a second order was issued by General Butler, in which he prohibited the use of any Confederate notes after May 26. This was immediately followed by a notice from the banks, given through the newspapers, advising all persons who had deposits with them in Confederate notes to withdraw them before May 27, and stating that all balances not withdrawn by that date would be at the risk of the owners.
This action of the banks General Butler refused to approve. He insisted that the banks had violated their charters in September, 1861, in suspending specie payments and introducing Confederate notes as currency, which, he declared in his peculiar manner, they had purchased at a discount with their own bills. These notes had obtained a wide circulation, and the action of the banks in accepting them over their counter, but refusing to receive them in deposit, would throw all the loss upon the public. Order No. 30, therefore, required that the banks incorporated, private banks and savings banks, should pay out no more Confederate notes, but that all depositors should be paid in valid money, in bank bills, U. S. Treasury notes or gold or silver. Eelative to the "shin-plasters" or private currency, with which the city had been flooded, it was provided that all persons who had issued this "money" should redeem their notes at once under penalty of confiscation of their property and imprisonment at hard labor.
By a subsequent order General Butler seized all the money in the New Orleans banks to the credit of the Confederate government or any of its agents, and in August imposed on the banks as a penalty for "having aided the rebellion" (that is the Confederate cause), an assessment equal to their investment in the defense bonds of the city. This fine was collected in four installments of 25 per cent each, and the money was used in furnishing with rations the large number of negroes who had refugeed in New Orleans from the neighboring country, and who remained in the city during the continuance of the Civil War, the majority of them idle and indeed unwilling to work, believing that emancipation meant freedom from labor.
During all of General Butler's administration of the affairs of New Orleans, as well as those of his successor. General Banks, the financial history of the city is filled with quarrels between the banks and the military authorities, and an immense number of claims resulted and much litigation growing out of them. Many of these suits are still on trial, and it would take pages to explain them. Even
after the restoration of peace, and when the banks got to business again, these complications continued. The Legislature was appealed to frequently to amend their charters; and the history of the Citizens' Bank alone w-ould furnish a large and interesting book of the changes in the methods of banking in New Orleans.
Under these circumstances it is impossible to give a general history of banking in the city after the war; and this can be best done in detail. There was no general panic and smash up, as in 1837, nor was there any such complications as during the Civil War. The New Orleans banks suffered from the general financial flurries which swept over the country in 1877 and 1893, and on such occasions were compelled to adopt the same precautions for their safety as the banks in other cities; but the crisis was never as general or as acute as it had been before. Banks went down, it is true, but they went down from their own inherent weakness or mismanagement, not as a part of a general crash. The bank history of the post-bellum period can best be considered under the several banks which grew up and prospered or failed.
The First National Bank, the first to take advantage of the national banking laws, had a short and inglorious career. An investigation into its affairs was ordered in May, 1867. At that time it was discovered that the affairs of the bank "were tangled up with those of its president, Mr. Thomas May, who w^as U. S. Assistant Treasurer at the time, and in whose office a defalcation of $1,077,079 was found by the special agents of the Treasury Department. The bank accordingly passed into the hands of a receiver at once, but its affairs were not fully settled until 1880.
The Louisiana National Bank was chartered in 1865.
The Germania National Bank was organized as the City Bank in 1865, but changed its nam^ to Germania in 1869.
The New Orleans National Bank was organized in 1871.
The Mutual National Bank was organized in 1871, but went down in 1898, in the bank flurry which carried dowTi three of the financial institutions of New Orleans.
The American National Bank was organized in 1889, but failed at the same time as the Mutual.
The State National Bank was organized in 1871. Originally the Louisiana State National Bank, it changed its name to State, dropping the Louisiana in order to avoid confusion with the Louisiana National.
The Whitney National Bank was organized in November, 1883.
The Hibernia National Bank was organized as a State bank in 1870, but
became a national bank in 1873. It swallowed up the National Bank
in 1896.
The Metropolitan Bank is a State institution, doing both a commercial and savings business, and was organized in 1870.
The People's Bank is a State institution, and was established in 1869.
The Bank of Commerce was established as a State bank in 1887, but went dowa in 1898, in the same flurry that broke the Mutual and American National Banks.
At the time of the Civil War New Orleans had two savings banks:
The New Orleans Savings Institution, incorporated March 15, 1855.
The Crescent City Savings Institution, incorporated March 13, 1857.
The New Orleans Savings Institution did a splendid business immediately after the Civil War, but its very bad failure in 1876 had a demoralizing influence on the savings bank business for some years, and the city was altogether without these banks or with very weak ones until the Germania Savings Bank entered the field in 1879 and restored public confidence in savings banks, which had been very much tried by the failure of former institutions.
Under the encouragement given by it and the very successful business it has enjoyed three new savings banks have sprung up in New Orleans, as follows:
Teutonia Savings Bank, chartered in April, 1893.
Bondent Savings and Safe Deposit Bank, chartered in 1893.
United States Trust and Savings Bank, chartered in April, 1893.
Of the other banks it is unnecessary to speak, as they are doing business under their old charters as State banks, such as the Canal and Citizens' Banks, or have taken out national bank charters like the Union.
The New Orleans Clearing House Association was organized May 8, 1872, and the first exchanges were made on June 1 of that year. Originally composed of thirteen members, the Association subsequently included all the commercial banks of New Orleans. In the panic of 1893 and on other occasions of financial flurry, when the market was in a frightened condition, the Clearing House proved of great advantage, not only to the banks, but to the entire business community by providing for the issue of clearing-house certificates, which were accepted by all and tided over the strained financial conditions that prevailed. The transactions of the Clearing House for the first year it did business, September 1, 1872, to August 31, 1873, was $501,716,239.06. It has varied but slightly from these figures since then, reaching its maximum in 1890-1, when the clearance ran
up to *536,038,535.85, and its minimum in 1884-5, when they sank as low as $393,452,741.10.
While the foreign insurance companies have always done a large business in New Orleans, the home companies have handled a great deal of insurance, not only for the city and the State of Louisiana, but for all the neighboring States, and even for some distant ones. The companies are:
Sun Insurance Company, chartered in 1855; capital, $500,000.
Germania Insurance Company, chartered in 1866, but reorganized in 18i)l; capital, $500,000.
Crescent City Insurance Company, organized as the Crescent Mutual in 1849; capital, $240,000. It has liquidated its affairs.
Merchants' Insurance Company, organized in 1835. From 1854 to 1893 it was the Merchants' Mutual; capital, $300,000.
Mechanics and Traders' Insurance Company; capital, $375,000.
New Orleans Insurance Association, organized in 1869, reorganized in 1874, with a capital of $200,000. Its business has been taken by the Sun Insurance Company.
Home Insurance Company, organized in 1878; capital, $400,000.
Teutonia Insurance Company, organized in 1871, with a capital of $250,000.
Lafayette Fire Insurance Company, organized in 1869, with a capital of $150,000.
Hibernia Insurance Company.
Southern Insurance Company, organized in 1883; capital, $300,000.
The Louisiana Homestead League was organized in 1891, and includes the following Homestead companies:
People's Homestead Association, organized in 1882.
American Homestead Company, organized in 1883.
Louisiana Homestead Association, organized in 1885.
Firemen's Building Association, organized in 1886.
Mutual Building and Homestead Association, organized in 1885.
Third District Building Association, organized in 1887.
Eureka Homestead Society, organized in 1887.
German-American Homestead Association, organized in 1885.
Suburban Building and Loan Association, organized in December, 1894.
Security Building and Loan Association, organized in October, 1893.
Si.xth District Building and Loan Association, organized in October, 1894.
Union Homestead Association, organized in 1886.
These associations have facilitated the purchase or building of homes by people of moderate means in New Orleans. They have encouraged a spirit of saving and economy and they have resulted in the construction of more than a thousand handsome and up-to-date residences in the city, and have enabled some two thousand families to own their homes who would have been unable to do so but for their assistance.
CHAPTER XXIV.
CLTJBS AND KINDRED ORGANIZATIONS. By Walter Parkek.
FROM the very founding of New Orleans the people of the city have devoted as much if not more time to pursuits of pleasure than to the vocations of the work-a-day world, and in a community where the amassing of wealth has ever been a consideration secondary to the true art of extracting from life that which is best, and where tradition dominates innovation, it is but natural that good-fellowship should be a foremost characteristic. From time out of mind the social side of life in the great metropolis of the south has been of the highest order and the stranger within her gates has never failed to carry away the pleasantest memories of the hospitable and courteous men and women whose fame as host and hostess is known the world over. Here men do not derive that keen satisfaction from the accumulation of money that is felt in other sections of the country, for, in Now Orleans, which has well merited the name, "The Delightful City," the parvenu is yet unknown. Here method is the child of a kind hearted, indulgent people, and is not of the school of Twentieth-Century Americanism. Here the business man spends his afternoons and evenings at his favorite club, and, if one is versed in tlie ways of the city, one will never call at his office before 11 of the morning nor after 3 of the afternoon. If one is a stranger he will marvel. No wonder then that New Orleans supports many handsome clubs, nor that the good fellows with which the city abounds, should in uncommon numbers organize for their mutual advantage.
From the great aggregytion of a single club of GOO members, each one of whrnn has had to stand a severe test of qualification, down to the little ilinncr club of five, whose dinners, served under the long shadows of the old French market where the choicest of viands are to be had, is the great range, the two extremes between which there are hundreds of organizations of all classes and varieties. From the earliest daj-s in the history of the city similar conditions have existed. Lack of space precludes the possibility of a review of the organizations which flourished in years that are gone, or, in fact, even mention of all that are now in existence, hence this chapter will be confined to those of greatest prominence of the present day.
BOSTON CLUB.
The Boston Club was organized in 1841 by a small coterie of gentlemen for the purpose of playing "the game of Boston," and is the oldest social club in New Orleans. From the beginning of its existence it has been famous as a rendezvous for army and navy officers. Of its original members none survive, and of those who were members previous to the Civil War but few are still alive. The club was incorporated in 1843 for a period of twenty-five years, and its first rooms were on Royal street; but in a short time these rooms were exchanged for rooms on the south side of Canal street, next to Moreau's restaurant, at first only a part of the building being used, but later the entire building. About this time other games than Boston began to be played in the rooms. During the Civil War the rooms were closed by order of the Federal authorities, but on August 5, 1865, they were again opened, on Royal street. Later the club moved to Carondelet street, and finally to its present quarters, on Canal street, between Carondelet and Baronne streets. Many of the prominent business men are members of this club, and in past days many very prominent men were members, such as Judah P. Benjamin, A. C. Meyers, and John R. Grimes.
Originally the number of members was limited to 150, and from the beginning the initiation fee has been $100, with annual dues of $100. When the club was reorganized after the Civil War the limit of membership was raised to 250. Among the presidents previous to the war was P. N. Wood, and since the war the following have been the presidents of the club: W. A. Avery, 1865; Judge Victor Burke, 1866-68; Gen. "Dick" Taylor, 1868-73; Dr. S. Choppin, 1873-80; A. P. Mason, 1880-83; Thomas J. Semmes, 1883-92; ex-Justice Charles E. Fenner, 1892 to the present time.
The present quarters of the club contain the following rooms: A parlor and
a billiard and pool room on the ground floor, the parlor being 55 feet deep and of harmonious width. The cafe is also on the ground floor, built out from the billiard room, and is 20x50 feet in size. The card room occupies the entire front of the second story and is 30x55 feet in size, and the lunch room in the rear of tlie card room is 30x50 feet. On the third floor in front is another card room and to its rear are the store rooms, bath-rooms, servants' rooms, etc. All the apartments are handsomely furnished and the home is in all respects an ideal one for club purposes.
PICKWICK CLUB.
The Pickwick Club was organized in 1857 in the parlor over the famous ante-bellum Gem saloon, the Pickwick Club and the Mystick Krewe being for many years, so far as was visible to the public eye, one and the same thing. At length, however, it became impossible to conceal the fact that they were so closely related, and the duality was dissolved. Comus became an independent organization and the Pickwick Club so amended its charter as to render the club an absolutely close one. But still, even down to the present day, Comus is the favorite of the members of the club. In its palmiest days the home of the club was the fine building at the corner of Carondelet and Canal streets, a four-story brick-and-stone building of Queen Anne architecture, which, prior to its partial destruction by fire in 1894, was one of the most stately buildings ever erected in New Orleans. The ladies' cafe, which from 1884 to 1894 was one of the chief prides of the club, was primarily for the use of the ladies of the families of the members, but it was never a financial success, and when the present quarters of the club on Canal street, near Eampart, were erected, no provision was made for a dining-room for ladies. There is, however, a banquet hall, in which dinner parties are frequently given, and in this hall the captain and the other officers of the United States cruiser New Orleans were entertained when that vessel paid her visit to this city in the spring of 1899.
The origin of this famous club is in a certain way attributable to Mobile, but to enter into the full particulars of this connection would require more space than can be spared in this work. Hence it is necessary only to state that seven gentlemen called a meeting for January 3, 1857, over the old Gem saloon. Thirteen responded other than the six of the seven that answered the call, and these nineteen members adopted the name of the Mystick Krewe of Comus. Within the next few weeks sixty-three additional members were added to the original number, and on February 24, 1857, Comus electrified New Orleans with the first illustrated
procession: "The demon actors in Milton's Paradise Lost." Proceeding to the old Gaiety Theater, "the grotesque maskers made much fun and merriment and enjoyed quizzing their sweethearts and wives to their hearts' content without revealing their identities. At 12 o'clock precisely the captain's whistle sounded and the Krewe marched without lights to No. 57 St. Charles street. On the third floor of this store a bounteous banquet awaited them, the experiences of the night were told in wine and wit and much enjoyment until early morning ended the first festival of the Mystick Krewe of Comus."
Later a social club was organized named the Pickwick Club. The two lower stories of the store at No. 57 St. Charles street, were rented and fitted up for club rooms. Colonel A. H. Gladden was president from 1858 until the breaking out of the war, and fell at Shiloh. The Pickwick gave its check for $1,000 toward the support of the families of those who had gone to the war, and was then virtually for a year or two disbanded; but it was in a measure kept alive by such men as Hon. John Q. A. Fellows, and was afterward fully resuscitated and reorganized oin the return of peace. The quarters of the club were at the corner of Canal street and Exchange alley up to 1881, when they were moved to the Mercer building, now the Boston Club, where they remained until 1884, when they were removed to the corner of Carondelet and Canal streets. In 1894 this building was burned, and the club removed to the other corner of the same two streets, later to the old No. 4 Carondelet street, and finally to its present magnificent quarters. When the club was on Canal and Exchange alley it entertained, one Christmas night. General W. S. Hancock, then in command of the military department here. This club has rendered efficient service on more than one occasion, having in 1874 aided in the overthrow of negro domination, and in 1878 having don? much to relieve distress occasioned that year by the great epidemic of yellow fever. In 1879 the clubmen organized themselves into what was known as "The Dietetic Association," and distributed beef tea and soup for the sick and delicacies for the convalescent from the door and windows of the club in Exchange alley
The presidents of the club have been as follows: Charles H. Churchill, General A. H. Gladden, Adam Giffen, Edward Barrett, W. H. Crafts, T. C. Herndon, E. B. Briggs, Octave Hopkins, James 6. Clark, Jules C. Denis, C. M. Soria, Paul Capdevielle, William Blake, Hon. E. B. Kruttschnitt, James G. Clark (second time), S. L. James, Frank B. Haynes and Eeuben C. Bush, present incumbent. The present quarters of the club are exceedingly handsome, no expense having been spared in fitting them up and furnishing them to suit the taste of the mem-
bers. In the rear of a white marble vestibule stands the familiar figure of Mr. Pickwick, and on the same floor are the club's office, the billiard room, the lounging room, and the bar. On the second floor are the main hall, the reading room and the card room, and on the third floor are the dining room and the private card rooms of the club. The entire building in its fittings and its furnishings is one of the finest in the South.
CHESS, CHECKERS AXD WHIST QLVB.
The Chess, Checkers and Whist Club is one of the 3'oungest, yet strongest, institutions of the city. The foundation of the club is ascribed to Charles A. Maurian, Charles F. Buck and James D. Seguiu, who, in 1880, founded a small club for the study and cultivation of the game of chess. Their first domicile was a single room in the building at No. 138 Gravier street. At the first meeting, held July 21, 1880, Mr. Maurian was elected president and Mr. Seguin secretary. The club records show the attendance at this meeting to have been twenty-seven, some of whom were represented by proxy. In the twenty years of its existence the membership has increased to 800, the present limitation.
The early history of this club clearly demonstrates the invincible power of a movement based on sound principles and popular demand. It is essentially a young men's club, but its membership lists include a large number of older men—men who have become prominent in business life, in the practice of the law and in the various other professions. Nearly every chess-player of skill residing in the city is a member, and the games of whist, checkers, etc., are indulged in. But the club has other objects than the encouragement of scientific games and the occasional entertainment of its friends; for, not infrequently, the informal discussions of the members turn on deep subjects and a wide range of topics of general interest and importance are taken up by men whose knowledge specially fits them for an intelligent expression of opinion. The chronicle of the club's rise from an humble origin to the powerful institution of to-day is interesting. Less than ten days after the first meeting a second was held, at which it was found the membership had about doubled. In October of the same year the membership had grown to 110, and larger quarters being required the club moved to No. 168 Common street, and two months later to larger rooms next door. The membership had reached the number of 150 January Si, 1881, and, the belief then existing that the club had reached its climax, so far as membership was concerned, the initiation fee was placed at $3, and an entire floor at the corner of Common street and Varieties alley was leased for club rooms.
Captain George H. Mackenzie, the renowned chess-player of St. Louis, visited New Orleans in the year 1881 and was the guest of the club from February 28 to March 10. He gave several exhibitions, displaying wonderful perception and great facility for rapid combination. President Maurian and Mr. James Mc-Connell made even games on even terms with the visitor, but the others were easily defeated. The visit of Mr. Mackenzie was the beginning of the visits of a great number of distinguished chess-players who have come to this city since then. The list of great players who have been guests of the club includes such names as Zukertort, Lee, Steinitz, Pillsbury ^and others. The series of tournaments, which to-day are a leading feature of the club, was inaugurated during the first year of the club's existence.
For two years the club enjoyed a substantial and healthy growth, and in 1883 the present quarters at the corner of Canal and Baronne streets were secured. Fire destroyed the building in 1890 and nearly all of the club's records were lost. In place of the old building a modern club-house was constructed, and this is the domicile to-day. Paul Morphy, whose fame as a chess-player is second to none in the history of the game, was a constant attendant at the club until his death, and in memory of him there is a bust of fine workmanship in the club-rooms. One of the most highly prized possessions of the club is a unique set of chessmen of Swiss workmanship, presented by E. Block on February 21, 1881. Block was a contemporary of Morphy's in the early days of chess-playing in New Orleans. Mr. Maurian was succeeded as president by Charles F. Buck. The other presidents have been: Hon. Ben C. Elliott, Samuel Stafford, Thomas E. Roach, Hon. George H. Vennard and Charles J. Theard, who has been president since April, 1893. The popularity of the club is best attested by the list of applicants, which contains almost as many names as does the membership list. Applicants must wait for resignations before their applications are acted on.
HARMONY CLUB.
The Harmony Club was organized during the early seventies by a number of the more prominent young Hebrews of the city. Its objects were purely social, but the close relations of the early members with the members of the Deutsche Company, an organization in a flourishing condition at that time, soon resulted in consolidation. Mr. Joseph Magner was the first president of the new organization, and with wise forethought, seeing that the Fourth District was destined to grow and improve rapidly, advocated building an up-town club-house, and succeeded in taking
the club as far up as Delord street. Some time thereafter the younger members secured a removal to Canal street. Years after, under the presidency of Judge I. D. Moore, the club was again moved up town, and now has magnificent quarters in its own handsome building at the corner of St. Charles and Jackson avenues. It is one of the finest buildings in the city. The Harmony Club membership is open to Jew and Gentile and is one of the centers of culture among the Hebrews of the city. The clvib as it stands to-day is in a large measure the natural (nit-growtli of the trying times of the Civil War, for it was through consolidation with the Deutsche Company that it became possible to carry out the broad objects which have made it so successful.
The Deutsche Company had its origin in a meeting of seven, all of whom were prominent in Jewish and German circles, in the latter part of 1862. This meeting was presided over by Mr. Sol Marks. The suggestion of the formation of a club was his and plans were put on foot with that idea in view. In April, 1863, a meeting was held with forty members present, and organization was effected. Mr. Marks was elected president and M. L. Navra, secretary. The stated object of the society was to cultivate sociability and to foster art and science. Soon after the new club was formed the two were brought together into one strong organization.
The Harmony Club is noted for the magnificence of its entertainments. The interior decorations of the cIul)-house are superbly grand. The membership includes many prominent Gentiles, who stand high in their stations of life.
LOUISIANA CLUB.
Among the oldest social clubs in the city of New Orleans is the organization known as The Louisiana Club. The formation of this society was effected in 1879 and it is a social club in every respect. The officers are Paul Gelpi, president, and W. A. Brand, secretary. The club now has on its rolls 153 members, with its rooms at No. 122 Carondelet. Regular meetings are held each month, but the quarters are always open to the members.
NEW ORLEANS PRESS CLUB.
Of all the clubs in New Orleans, the one finally launched with the greatest promise of potentialities for the good of the city was the New Orleans Press Club. Various attempts in previous years had been made to establish a press club, but they had all failed for one or another reason.
The longest lived of any endeavor on the problem was the last; and it repre-
sented possibly the best planned and best executed of the attempts. It found its original motive in the recognition, by some members of the newspaper fraternity, of how hopelessly separated the reportorial brethren on the different papers were.
The first form of organization was a "call club." It had no domicile. It had no dues, no assessments, no cares, no obligations. It consisted in a dinner once or twice or thrice a month, at 2 or 3 o'clock a. m., when every one but the pressmen had left the newspaper shops. Henry Eightor was the first president of this body; Harry Hester, the first promoter of the plan. The first dinner took place at the Grunewald Hotel at 2 a. m. There were thirteen newspaper men present. Day was dawning when the club adjourned. It was a genuine success despite the unlucky number. The fun ranged from national subjects to Hester's famous discussion as to which side of a bluebird's eggs had the greatest number of spots—the north or the south side.
The initial number of the dinners made the little club famous. At the ne.xt dinner, at Forrestier's, corner Decatur and Madison streets, there were twenty-six members of the newspaper fraternity present, and an international complication, between a representative of the German press and one of the French, arose. It tended to increase interest in the club, and from that time on the Press Club dinners grew in popularity.
It existed as a call organization for about one year, when a meeting of all the members was held at the St. Charles Hotel, on the 17th of August, 1897. At this meeting, one of the most memorable in the early history of the club, in that the vast majority of the workers of the local press were present and enthusiastic, it was resolved to domicile the club. The following plan was adopted: There were to be two kinds of membership—active and associate. In the former, to keep the club always a real press club, was to be lodged the power of voting on everything except eligibility to membership, on which all members could vote. If a newspaper man went out of the business he ipso facto became, unless he were a charter member, an associate member. If an associate entered the business he became an active member. Dues and privileges were to be imiform. Active membership was unlimited by reason of the comparatively small number of newspaper men, but associate membership was limited to five hundred.
Under this plan of operation the club's new domicile was opened at No. 320 St. Charles street, a few months after its organization, under the new plan. It was conservatively estimated that 6,000 guests passed through its rooms, partook of its hospitality and heard some part of its programme. The opening programme, indeed, lasted for twenty-four consecutive hours, from 4 p. m. one afternoon to
the same hour the next afternoon. It was opened by prayers and addresses by such conspicuous men as Dr. B. M. Palmer, I. L. Leucht, E. B. Kruttchsnitt, on behalf of the governor. Mayor Walter C. Flower, etc. Pages of the local press were devoted to the club's opening. It was one of the great events of the year in New Orleans. This was in the early part of 1898.
Two causes led to the club's ultimate dowTifall—primarily, dissension among the newspaper men; a floating indebtedness too heavy for the plan and budget of the club.
The first cause weakened its influence and checked its immense original momentum. As a result, the club could never reach the high-water mark possibilities of its budget. It consequently went into liquidation in January of 1900.
Its first president was Henry Eightor, who resigned and was succeeded by Mr. Armand Capdevielle, editor of the Xew Orleans Bee. Its next president was J. M. Levuque, at the time of the Times-Democrat. Norman Walker was the last president of the club, being elected August 17,1899.
Many famous men and women have been entertained, and have entertained, at the Press Club. Bryan, Ingersoll, great actors and actresses, musicians, singers, etc., etc. Its programmes have varied over a range extending from maccaroni dinners to evenings of original music.
THE MILITARY CLUB.
This organization was formed in 1895-6, as an offshoot of the Southern Athletic Club. Companies A and B of what is now known as the Fourth Battalion were members of the S. A. C, but decided to withdraw, and the result was the formation of a social and military club under the title of The Military Club. Quarters were established at Exchange alley and Canal street, and J. M. Baldwin was elected president. He was succeeded by J. M. Huger and after about two years of varied prosperity the organization disbanded.
ERA CLUB.
The Era Club, the membership of which is composed of leading women of New Orleans, was established in 189G as an offshoot of the Portia Club, which has since disbanded. It was founded by Mrs. Evelyn W. Ordway. one of the faculty of the Sophie Newcomb Female College, for tiie purpose of advancing woman's suffrage, and since its organization has brought the question into some local prominence. It M-as through the efforts of the Eia Club that the Women's League for
Sewerage and Drainage was formed, and the women taxpayers did much toward securing the improvements for the city.
Mrs. Ordway is the president of the club. The first president elected after organization was Miss Bell Van Horn.
LOUISIANA HISTORICAL SOCIETY.
The Louisiana Historical Society, domiciled in New Orleans, has made many valuable compilations of historical data concerning the city of New Orleans and the State of Louisiana. The society was organized January 15, 1836, in Baton Eouge. At the meeting at which organization was effected. Judge Henry A Bullard was elected president, ana Mr. Harrison and Louis Janin, secretaries. The prosperity of the new society was not of long duration and it was soon disbanded. However, several years later, several gentlemen who were members took an active interest in the work, reorganized the body and in 1846 elected the eminent jurist and historian, Francois Xavier Martin, president, with John Perkins, J. D. B. De-Bow, Edmund J. Forstall, Charales Gayarre, General Joseph Walker and Alfred Hennen, members. One year later the society was incorporated and Judge Bullard was re-elected president. Judge Martin having died in December after his election to the office. At this election John Perkins and J. D. B. DeBow were chosen secretaries.
For the next half decade the society prospered and by an act of Legislature in January, 1860, it became a State institution, insomuch as it was decreed that "in the event of a dissolution of the Historical Society, all books, maps, records, manuscripts and collections shall revert to the State for the use of the State Library."
At this time Charles Gayarre was elected president, but until 1877 there was little interest shown in the work and nothing of importance was done by the organization. In April of that year a new charter, was obtained from the Legislature and the domicile of the society was transferred from Baton Rouge to New Orleans. Then the work was revived.
From the time of his election. President Gayarre held the office for 28 years, resigning in 1888. He was succeeded by Judge W. W. Howe, who served until February, 1894, when the present officers were elected. During this time interest in the work of the society was greatly revived and the members accomplished much good work in the way of collecting historical data. The membership increased and much outside interest was shown.
The present officers of the Louisiana Historical Society are: Alcee Fortier, president; Gustave Devron, first vice-president; John E. Ficklen, second vice-president; J. W. Cruzat, treasurer; Grace King, secretary; and Charles G. Gill, assistant secretary. As there is no provision made by the State for the support of thu society, an annual sum of $3 has been decided iipon as dues, and these funds are used to preserve the historical collections of documents and relics of the early life and growth of the State. The society is in good financial condition and the work is being carried on with great enthusiasm.
LA VAEIETE ASSOCIATION.
La Variete Club, the real title of which is La Variete Association, is the owner of the Grand Opera House, and has its club rooms under the foyer and orchestra circle of that theater. The association was organized in the early part of 1849, through the efforts of Thomas Placide, who proposed to a number of prominent men a plan for the erection of a new theater "for the purpose of producing burlesque, vaudeville and farce." Mr. Placide's idea was to form an association of thirty members in order to raise $15,000 for building purposes. This plan was carried out, but the stock was increased, forty-two subscribers having been secured. Mr. Placide agreed "to build a theater equal, if not superior, to any in this country," and "to spare no exertion to produce the proposed entertainments with the best talent, costumes, scenery and appointments that could be procured."
A stockholders' meeting was held May 29, 1849, and organization was effected with Peter Coner}-, Jr., president; C. W. Cammack, secretary, and iST. N. Wilkinson, treasurer. Mr. Placide was placed in charge under an agreement which provided that the stockholders should receive 8 per cent on their investment; the association was to receive half the profits at the end of the season; the members were to have two seats, with a retiring room for their exclusive use, and the theater should be known as Placide's Variete. The building was commenced in June, 1849, and the corner-stone was laid on the 9th of that month. The site was the corner of Gravier and the narrow passage-way in the rear of the Cotton Exchange, to which the name Varieties alley was given.
The theater was opened December 7, 1849. The first season proved highly successful. The second season opened with J. H. Calder the lessee. The stock company then billed included among its members Fred N. Thayer, Ben DeBar and Mrs. Charlotte Howard. At that time French opera was being successfully produced, as were also good plays at the old St. Charles theater. The Academy of
Music had very little standing as a theater in those days. Fire destroyed the theater April 25,1855, and when rebuilt was enlarged considerably. The name was changed to Crisp's Gaiety in 1856 and at the commencement of the Civil War the house was closed. It was reopened in 1863 and after one season Lawrence Barrett took charge. The house again burned December 1, 1870.
The association then decided to rebuild on Canal street, and at a cost of $320,-000, erected the present structure, known as the Grand Opera House. The souvenirs kept in the club room are interesting, as, included among them, is probably one of the finest collections of photographs of theatrical celebrities in the country. An oil painting by Joseph Jefferson is also one of the treasures there displayed. The rules of the club provide that non-residents may be admitted to the privileges of the club rooms without membership privileges in the theater except when introduced to the stockholders' seats on extra stock shares. The stockholders are and have been leading men of New Orleans.
I
FRENCH OPEIiA CLCB.
The French Opera Club is an organization of the stockholders of the French Opera, which was formed during the season of 1868-69. At the time of organization, Mr. Frellsen was elected president of the club and Louis Burthe, secretary. Since then there have been several gentlemen who have held the office of president, but Secretary Burthe has served in the capacity of his office since the day of his election. Judge G. H. Theard is now the president. The club has its rooms in the French Opera House, and during the performances the members are entitled to seats in the club box. The membership numbers about 120.
lOUNG men's gymnastic CLUB.
The Young Men's Gymnastic Club is the oldest organization of its kind in the South and to-day is one of the best equipped institutions in the country. The club was organized September 2, 1872, under the name of The Independent Gymnastic Club, and had at the beginning a limited membership of 14, made up as follows: J. C. Aleix, A. Rehage, J. A. Rehage, C. G. Collins, F. J. Aleix, C. Wein-burger, J. Roca, F. Kunz, L. A. Nicaud, C. Burkhardt, J. Burkhardt, A. D. Hofeline, F. Claiborne and Wm. Frederichs. At the first meeting J. C. Aleix was elected president. Among the members who have since served in this capacity are Val. Merz, William Frederichs, James Flynn, Ed J. Guoringer, A. M. Delavallade, W. A. Briant, James J. McCann, George G. Bohne and James J. Woulfe. The name of
the club was changed a short while after organization was effected and on September 13, 1883, it was incorporated under its present title. In 1888 the organizatioa was reincorporated.
From the beginning the object of the club has been to foster and promote work in the gymnasium. The quarters now occupied by the club are at No. 224 North Rampart street. The buildings and furnishings are in keeping with the prosperous condition of the institution. Besides the gymnastic department, which is the principal feature, there is every convenience of the modern social club—reading rooms, billiard and pool rooms, cafe and all accessories. In connection with the gymnasium is a salt-water bath, which is supplied from an artesian well sunk to a depth of 1,350 feet. The bath-rooms are equipped with every convenience and there is a large swimming pool, in which the water is kept at the proper temperature at all seasons. The club is incorporated as a stock company, and to become a member it is necessary to hold one share of stock. The present officers are: James J. Woulfe, President; Vic. LeBeau, Vice President; William H. Heyl, Secretary, and Hyp. Garrot, Treasurer. The affairs of the club are managed by a board of directors, who have full control.
SOUTHERN ATHLETIC CLUB.
Almost since the day of its organization the Southern Athletic Club has been a leader among the organizations of its kind in the South and it has established records both on the field and in the arena which stand ahead of any similar club records south of Louisville. The S. A. C. was formed under the name of the Crescent City Athletic Association and incorporated June 19, 1888. The first President elected was S. P. Walmsley, with J. C. Campbell, Vice President; G. S. Smith, Treasurer; W. L. McGary, Financial Secretary; W. H. Churchill, Recording Secretary, and Joseph Sehlesinger, Corresponding Secretary. The founders and first members on the club rolls were: L. E. Bowman, 0. S. Smith, G. S. Smith, H. D. Higanbotham, P. S. Campbell, T. J. Kohl, Theo. Holland, C. Janin, W. H. Churchill, D. II. Hoffman, W. J. Henderson, John J. Thomas, C. B. Churchill, P. A. Cooney, P. J. Kennedy, B. Chew, L. T. Tarleton, M. S. Waterman, Maurice McGraw, J. B. Waterman, J. Sehlesinger, James C. Campbell, Abe Kottwitz and H. P. Smith.
The formation of the club took place in what was then known as the "skating rink" on the corner of Prytania street and Washington avenue, but in December the building, which had been erected by the club across the street, was completed
and taken possession of. It was at this time that the name of the organization was changed to the Southern Athletic Club. President Walmsley was elected to serve a second term in 1889, and was succeeded bj' W. S. Parkerson the next year.
About this time the S. A. C. Battalion, which afterward became the Fourth Battalion, was formed. President Walmsley was elected Major of this branch of the organization. President Parkerson succeeded himself to the office at the next election, as did James C. Campbell, who was elected in 1892. During President Parkerson's term of office, the club was reorganized into a stock company and about the same time the spring games, in which the S. A. C. has always distinguished itself, were inaugurated.
During the next two years^the club made many improvements and J. P. Baldwin and John Clegg served as presidents. In 1896 T. L. Bayne was elected and served two terms. In 1898 James C. Campbell was again elected, and 1899 John E. ConnifT, the present chief officer of the club, succeeded him. The other officers are: John F. Brent, Vice President; C. H. Charlton, Jr., Financial Secretary; Edward Eightor, Eecording Secretary; T. J. Council, Corresponding Secretary; Dr. J. Moore Soniat, Captain, and E. W. AUeyn, Lieutenant. These officers, together with the following gentlemen, compose the Board of Directors: D. E. Buchannan, Chas. F. Stott, B. P. Sullivan, Geo. Fuchs, E. S. Lamphier, Pierre Crabites, H. C. McEnery and A. H. Dumas.
The equipment of the S. A. C. quarters is second to none of its kind in the South, and the club is represented on every football, baseball or other sport field in which the other clubs of the Amateur Athletic Union appear, and has in nearly every meet retired as victors.
AMERICAN ATHLETIC CLUB.
The American Athletic Club, at one time the strongest organization of its kind in the South, was formed in the early spring of 1890 and flourished until 1898, when it was disbanded. Among the organizers were: S. Odenheimer, E. H. Eosenfeldt, Charles F. Alba, Henry Zeller, J. U. Landry, Thos. L. Eoss and J. 0. Eeinecke. M. T. Elfert was the first president and served two terms. He was succeeded by Mr. S. Odenheimer, who served until the election of T. C. Loret, Sr.; and it was during the latter's term of office that the organization disbanded. For several years after the club was organized it was in a very prosperous condition and at one time had a membership of 1,300. Ground was purchased on the corner of Napoleon avenue and Constance street, and a club-house erected. The
quarters were furnished completely for athletic and social purposes and were considered equal to any in the South. During its life the American Athletic Club was a staunch member of the Southern Amateur Athletic Union.
SOUTHERN YACHT CLUB.
The Southern Yacht Club is the second oldest yachting organization of this country. It was formed by the members of what was known as the Stingaree Club, an exclusive social organization of New Orleans, in 1849. It was the custom of this club to take cruising trips along the southern coasts, and after one of these excursions along the coast of Mississippi it was decided to place the surplus money in the treasury in new boats, and the result was the organization of the Southern Yachting Club, July 21, 1849. The first commodore elected was Harry Rareshide. The annual yachting season opened in May, and until the Civil War great interest was taken in the events. During the war the club was practically disbanded, but afterward the sport was revived, and regattas have been held each season since. In 1878 the club-house on Lake Pontchartrain was erected and E. J. O'Brien, a wealthy cotton broker, was elected commodore of the club. He served until 1882, when Arthur Ambrose Maginnis succeeded him to the office. Mr. Maginnis served until 1884, when Commodore O'Brien was re-elected and held the office until the election of Commodore R. S. Day, who served from 1887 until 1891. During the next year the office was held by Commodore W. A. Gordon, and he was succeeded by Thomas Sully, who served as commodore until 1894. Commodore Lawrence O'Donnell was then elected and held the office until the spring of 1897, and Walton Glenny was elected for the two succeeding terms. In 1899, the fiftieth anniversary of the organization of the club. Commodore Albert Baldwin was elected. During this year it was decided to build a new club-house at West End, on Lake Pontchartrain, as a lasting memorial of the semi-centennial anniversary of the S. Y. C. The building is a model of modern club-house architecture, and was formally opened at the spring regatta in May, 1900.