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This Day in Business History

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January 1

1772		The London Exchange Banking Co. issues the first traveler's checks.
1862		In order to support the Civil War effort, the U.S. Congress enacts the nation's first income tax law.
1914		The world's first airline, St. Petersburg Tampa Airboat Line, starts operation in Florida.
1928		The Milam Building (first air-conditioned high-rise office building) opens in San Antonio, Texas. At the time it opened, it was also the tallest brick and concrete-reinforced structure in the U.S.
1934		Congress and President Franklin D. Roosevelt create the Federal Deposit Insurance Corporation to provide federal government guarantee of deposits and maintain stability and public confidence in the nation's banking systems.
1958		The first full customs union is implemented, with Belgium, France, West Germany, Italy, Luxembourg and the Netherlands agreeing to remove trade barriers. It was originally known as the European Economic Community (EEC) and informally called the Common Market in the U.K.
1966		Led by Michael Quill, disgruntled members of New York City's branch of the AFL-CIO Transportation Workers Union make their case for a wage hike by going on strike, causing the shutdown of the city's subway system. Later in the day, Mayor John V. Lindsay was sworn in as New York's first Republican mayor in 15 years. New leader or not, the city government played hardball and Quill was jailed on January 3 for refusing to end the strike. Even with Quill behind bars, the workers kept their stranglehold on New York transportation until January 13, proving their point and winning a 15 percent pay raise from the Transit Authority.
1973		The United Kingdom, Ireland and Denmark join the Common Market (EEC).
1984		As per U.S. District Court Judge Harold Greene's ruling on August 5, 1983, AT&T divests itself of its 22 Bell Systems companies. While AT&T was still a major player within its industry, the divestiture nonetheless altered the company's once monopolistic size and revenue stream: AT&T's assets suddenly dropped from $149.5 billion to $34 billion and its workforce shrank from 1.9 million to 373,000 employees.
1994		The North American Free Trade Agreement goes into effect.
1999		The euro officially comes into existence as the new single currency of 11 European countries.

January 2

1882		John D. Rockefeller officially unites his Standard Oil Company with its various producing, refining, and marketing affiliates to form the Standard Oil Trust, the United States' first sanctioned monopoly. Under the terms of the Standard Oil Trust Agreement, brokered by Rockefeller and eight other trustees, the oil giant could be acquired, sold, combined or divided as necessary. While this was all good for Standard Oil's trustees, the company's cutthroat tactics raised the ire of certain legislators, as well as some sectors of the public. In 1892, the Ohio Supreme Court ruled in favor of splitting Standard Oil's monopoly, though Rockefeller was able to maintain the company's choke-hold on the industry by shifting its holdings to companies located in other states. In 1899, Rockefeller formally reunited these companies under the New Jersey-based Standard Oil Company. However, the passage of the Sherman Antitrust Act (1890), which was a byproduct of the growing distaste for Standard Oil's hard-driving practices, finally spelled the end of the company's monopoly. In 1911, the U.S. Supreme Court ruled that Standard Oil was illegal under the terms of the Sherman Act and forced the company to shed its primary holdings.
1919		The New York Stock Exchange installs a separate ticker to track bond trading.
1996		In hopes of forwarding its ambitious restructuring program, which included plans to divide into three separate companies, telecommunications giant AT&T announces its plan to take a $6 billion charge against its fourth-quarter earnings. In the main, the charge was designed to pay for the massive round of layoffs necessitated by the restructuring program. AT&T estimated that it would trim its rolls by 40,000 workers over the ensuing three years; the company predicted that 30,00 of those cuts would be involuntary. While some Wall Street analysts applauded the move, praising it as a potential boon to AT&T's shareholders, it was less popular with the scores of employees who were likely to lose their jobs.

January 3

1916		Actress turned consumer activist Betty Furness is born. Furness churned out a host of films, mostly B-movies, throughout the 1930s and 1940s. By the 1950s, she was a fixture on the small screen, starring as the "Lady from Westinghouse" in an enormously successful series of commercials for the home appliance giant. Furness's highlight as a pitchwoman was her live appearances during the 1952 and 1956 political conventions, where, decked out in an ever rotating series of outfits, she sealed her fame while sending Westinghouse's sales through the roof. The 1960s and 1970s saw Furness lend her celebrity to the burgeoning consumer rights movement: following a stint as the chair of Lyndon Johnson's Committee on Consumer Affairs, Furness became a consumer reporter for NBC News.
1949		The Supreme Court rules that states held the right to outlaw the closed shop. This provision, originally passed as part of the Taft-Hartley Act in 1947, handed states the power to limit one of labor's most potent bargaining tactics. As such, the ruling effectively altered the course of the labor movement during the 20th century, not only by increasing management's leverage, but by curtailing labor's power, as well as its political legitimacy.

January 4

1877		Fiercely competitive and fabulously wealthy Cornelius Vanderbilt, one of America's archetypal businessmen, dies. Vanderbilt was born to a downtrodden family in 1794, he fled school at age eleven to work on New York's waterfront. A budding young capitalist, Vanderbilt bought a boat in 1810 and started a small ferry business. However, Vanderbilt sold his schooners in 1818 to go and learn the steamer business under the wing of Thomas Gibbons. By 1829, Vanderbilt had purchased his own steamship; by aggressively slashing fares and lavishly appointing his steamers, Vanderbilt became the ruling force in the shipping industry. In 1862, he turned his attention to the burgeoning rail industry, using his trademark competitive touch to build an empire that included the New York and Harlem Railroad, as well as the New York Central Railroad. Toward the end of his life, Vanderbilt tempered his competitive zeal with a touch of altruism. He donated $1 million to Central University (later renamed Vanderbilt University) and masterminded the construction of New York's Grand Central Terminal, which employed a number of the workers who were devastated by the Panic of 1873. When Vanderbilt died, with an estate of some $100 million, he was the wealthiest man in America.
1965		An ailing Leo Fender sells his guitar and amplifier company to broadcasting behemoth CBS. Starting in the early 1940s, Fender gave the world a steady stream of guitars including the Telecaster and the Stratocaster; Fender also designed innovative bass guitars, as well as increasingly sophisticated amplifiers. CBS held on to the Fender Guitar Company until 1985, when the decision to shed its non-broadcast holdings triggered the sale of the landmark guitar concern to a small contingent of employees and investors led by William Schultz.

January 5

1914		The Ford Motor Company rolls out a series of initiatives targeted at improving the lives of its workers. Along with boosting the company's minimum wage to $5.00 per day, Ford also unveiled plans to trim its work day to eight hours. Whatever the merits of these measures, they were something of a necessary corrective, designed to offset the potentially "dehumanizing" effects of Ford's recent move to perpetually operating mode of assembly-line production. Though the company was now able to churn out 2,000 autos a day, the quicksilver pace took a severe toll on Ford's assembly-line workers.
1933		Construction gets started on the Golden Gate Bridge. The bridge stretched across the San Francisco Bay and made it a lot easier to get around town. With its tall towers and famous red-paint job, the bridge quickly became a famous American landmark, and a symbol of San Francisco.

January 6

1896		With America's gold reserves at perilously low levels--the reserves had dwindled to a scant $41 million the previous February--President Grover Cleveland issues a public subscription. However, the success of the subscription hinged on the public's willingness to place its faith in the government, no small matter since a number of Americans had lost their patience with Cleveland during the gold crisis. Early in 1895, Cleveland had brokered a deal to sell $62 million at a relatively small premium to J.P. Morgan's syndicate. The maneuver outraged the nation, as a number of people accused the president of being a bedfellow of the banking community. However, the nation looked past its anger and snapped up the entire run of the subscription, which helped resuscitate the country's ailing finances.
1983		President Ronald Reagan gives the green light to one of his pet proposals, a gas tax hike designed to raise funds for the nation's roads and bridges. That the bill made it to the Oval Office was something of a minor miracle, as the nation's legislators spent a good part of the fall embroiled in a nasty partisan debate over the relative merits of the tax hike. However, the Senate finally passed the bill on December 23, 1982, paving the way for the Federal gas tax to be increased by a nickel. The heftier tax rate in turn promised to raise $5.5 billion a year for highway repairs and general transportation maintenance. And, though the president was not one for using public funds to stimulate employment, some legislators estimated that the tax increase would help create roughly 320,000 jobs.

January 7

1782		The Bank of North America opens for business, making it the nation's first commercial bank. Based in Philadelphia, the bank was the brainchild of Robert Morris. Despite the bank's success, Philadelphia's run as America's leading home of private financial institutions was short-lived. Soon after the Bank of North America opened, the Pennsylvania legislature moved to outlaw private banks in the state, a decision that led scores of prospective bankers to set up shop in the nation's eventual financial center, New York City.
1872		One of Wall Street's more colorful and unscrupulous characters, James Fisk, dies. Born in Bennington, Vermont in 1834, Fisk worked at a series of jobs, including stints in the circus and dry-goods industry, before becoming a stockbroker. In 1866 he linked up with financier Daniel Drew to form a brokerage firm, Fisk and Belden. Along with Jay Gould, Fisk and Drew pulled off a scheme in 1867 to protect their controlling interest in the Erie Railroad from the acquisitive clutches of Cornelius Vanderbilt. Around the same time, Fisk was installed as the vice president and comptroller of Erie, positions he exploited to gain funds to support his burgeoning interest in Broadway shows and Broadway's starlets. In 1869, Fisk joined forces again with Gould and Drew to make a bold play to conquer the gold market. The result of their finagling was one of the worst financial disasters in U.S. history. Along with plunging America and stray parts of Europe into a depression, Fisk managed to lose a chunk of his fortune on the scheme. However, in 1872, a squabble with his lover, Josie Mansfield, a.k.a. the "Broadway Beauty," led to Fisk's fatal shooting by Edward Stokes.
1931		The Committee for Unemployment Relief, formed at President Hoover's command in October 1930, releases a report that detailed the depths of the nation's woes. According to the committee, some 4 to 5 million Americans were unemployed. However, the Depression only continued to grow worse, which further swelled the unemployment rolls; by 1932, some 13 million Americans were without jobs.

January 8

1985		President Ronald Reagan announces that his Treasury secretary Donald Regan and chief of staff James Baker were planning to swap jobs. The surprise move left more than a few legislators scratching their heads. Some wondered if Regan, a former Wall Street leader, had the political savvy and power base to fill Baker's shoes. Regan, however, pitched the switch as a solid move for the Reagan Administration and defended his skills as a manager. He also predicted that Baker would use the Treasury post to push for tax reform, though some conservatives feared that the new secretary would be more amenable to tax hikes than his predecessor.
1997		Texaco Inc. takes action against David Keough, one of the executives surreptitiously caught on tape making racist jokes and admitting to destroying potentially incriminating documents. An assistant treasurer at Texaco's finance insurance subsidiary, Keough was fired after officials for the oil giant received the findings of independent counsel Michael Armstrong's investigation into the tape scandal. Keough's firing was just the latest chapter in Texaco's tape saga: earlier in 1996, the discovery of the tape had helped a group of 1,400 employees win a $175 million settlement in a racial discrimination suit brought against the company. That same year Richard Lundwall and Robert Ulrich, two of the other executives captured on the tape, stood trial on charges of conspiracy and obstruction of justice; Lundwall and Ulrich were acquitted of those charges in 1998.

January 9

1986		The Federal District Court in Boston ordered an injunction barring the Eastman Kodak Company from selling its instant cameras. The injunction brought a close to a vicious court tussle between the venerable photo giant and Polaroid, which had charged Kodak with swiping the patent for its trademark instant camera. Kodak initiated a voluntary program to compensate owners of its instant cameras who were unable to purchase film as a result of the ruling. However, a series of class-action suits against Kodak forced the company to scrap this voluntary compensation program. This didn't let Kodak off the hook: in 1988 a Chicago court settled a class-action suit against Kodak by forcing the company to establish an elaborate program for notifying and issuing rebates to consumers.
1990		The Air Transport Association reports that U.S. air carriers piled up $2 billion in losses during the previous twelve months, marking the industry's worst annual performance since deregulation in 1978. The Air Transportation Association, an industry trade group, pointed to skyrocketing jet fuel costs, a downturn in the U.S. economy and Iraq's offensive against Kuwait as the primary culprits for the airlines' fiscal woes. However, while explanations were seemingly evident, solutions were not quite as forthcoming. Worse yet, 1991 promised to be an equally grim year for the industry.

January 10

1901		In the town of Beaumont, Texas, a 100-foot drilling derrick named Spindletop produces a roaring gusher of black crude oil at 10:30 a.m., coating the landscape for hundreds of feet around in sticky oil. The first major oil discovery in the United States, the Spindletop gusher marked the beginning of the American oil industry. Soon the prices of petroleum-based fuels fell, and gasoline became an increasingly practical power source. Without Spindletop, internal combustion might never have replaced steam and battery power as the automobile power plant of choice, and the American automobile industry might not have changed the face of America with such staggering speed.
1980		Labor loses one of its most powerful leaders, AFL-CIO chief George Meany. Born in 1894 in New York City, Meany took after his father and entered the plumbing business. A union man from the start of his career, Meany steadily climbed to the top of New York's local and state labor chapters. In 1939 he was selected to become the American Federation of Labor's secretary-treasurer; by 1952, he was the president of the AFL. A few years later, Meany brokered a landmark merger between the AFL and its once-hated foe, the Congress of Industrial Organizations (CIO). Never one for the radical side of unionism, Meany used his spot atop the AFL-CIO to steer its member unions into more mainstream political waters. He made cleansing labor and the world of communism a central goal of his reign; in the eyes of some of his critics, Meany spent more time crusading against communism than organizing workers. A fiery and sometimes domineering leader, Meany had his share of high-profile squabbles: in 1957, he expelled Jimmy Hoffa and the Teamsters from the AFL-CIO; a long-simmering dispute with Walter Reuther drove the United Automobile Workers of America from the organization in 1967.

January 11

1757		Alexander Hamilton is born. Along with fighting in the American Revolution and scribing a number of the Federalist Papers, he was instrumental in shaping America's early fiscal course. In 1789, President George Washington installed Hamilton as the first Secretary of the Treasury. Once in office, Hamilton set about developing a plan for repaying America�s considerable war debts, as well as establishing the young nation�s foreign and domestic credit. Hamilton outlined his plans in a series of reports delivered to Congress between 1790 and 1791. An ardent proponent of centralized government, Hamilton used the reports to push fiscal policy that expanded the Federal government's reach and responsibilities. He called for the Federal government to assume responsibility for debts accrued by the states, a notion that raised the ire of states'-rights proponents and some powerful members of the business community. However, Hamilton brokered a deal with Thomas Jefferson to secure enough votes to ensure the passage of his legislation. In a later report, Hamilton successfully made the case for the establishment of the Bank of the United States, a strong national institution patterned after the Bank of England. Despite these victories, Hamilton was a lightning rod for controversy and criticism. His Report on Manufacturers, which drew heavily on works of Adam Smith in its call for protective tariffs to nurture America�s burgeoning industrial sector, was shot down by Congress, though it later proved to be a key influence on the nation�s economic development. By 1795, Hamilton had grown weary of waging battle with the legislators and retired to attend to his private fortune. However, a long string of presidents kept Hamilton on as a key, though unofficial, advisor long after he surrendered his Treasury post.
1973		Richard Nixon ends the wage and price control program that he initiated during the summer of 1971. When Nixon first announced the program, which included temporary freezes on wages and rents, as well as the end of the government's 25-year-old policy of converting foreign money into gold, he hailed it as the dawning of a "new prosperity." However, despite triggering a brief surge on the stock markets, Nixon's initiatives did little to cure the economy's various ailments; by the time the president ended the program, the national debt, as well as the inflation and unemployment rates were all steadily on the rise.

January 12

1897		The National Monetary Conference convenes in Indianapolis, Indiana, to chart America's fiscal course into the next century. The conference's main result was the establishment of a congressional committee charged with developing a financial system based on the burgeoning gold standard.
1984		A fiscally minded efficiency panel weighs in on America's bloated deficit and releases a report recommending various ways for the government to shore up its troubled finances. Under the lead of Chairman J. Peter Grace, the chairman of W.R. Grace & Co., who had been appointed by President Ronald Reagan to head a private sector survey on cost control, the board outlined ways for cutting federal spending by $424.4 billion as a means to rein in the deficit.

January 13

1994		Telecommunications titan GTE downizes. In the midst of a massive restructuring program to "streamline" operations for the "multimedia age," the company announced that it was taking a $1.8 billion pretax charge for the fourth quarter of 1993, and planned to slash its staff by some 17,000 jobs. GTE chairman Charles R. Lee declared the moves necessary for the company's future, noting that without a "competitive structure" GTE would likely "blow up." However, this logic didn't mollify GTE's primary union, the Communications Workers of America, which derided the lay-offs as "yet another example of a highly profitable company eliminating...the people who helped build the company and created its technology to further enhance the bottom line."
Born on January 13
1923		Horatio Alger, the author whose work made his name synonymous with the American ideal of young men gaining success through hard work. The son of a Massachusetts minister, Alger received a degree from Harvard Divinity School in 1860. Alger was set to follow in his father's footsteps and was ordained as a Unitarian minister in 1864, but resigned shortly thereafter. Always a fan of writing--he briefly worked at a magazine before attending divinity school--Alger moved to New York City and in 1867 published his first--and perhaps best-known work, Ragged Dick; or, Street Life in New York with the Bootblacks. In Ragged Dick, Alger imagined an America with a truly fluid class system: through dint, determination, and a healthy dollop of luck, the book's hero, a downtrodden shoeshine boy, catapulted himself into a life of prosperity and fame. It was an undeniably appealing vision, especially at a time when America's booming industrial sector seemingly promised an all-access ticket to prosperity. Ragged Dick proved to be immensely popular, prompting Alger to churn out a parade of books featuring hardscrabble heroes who managed to escape from the depths of poverty. Alger died in 1899, impoverished after giving his wealth to the poor.

January 14

1875		The United States was involved in a roiling debate over greenbacks, the paper currency issued during the Civil War. So-called "soft money" supporters had taken up the cause of the greenback and successfully pushed for the paper notes to stay in circulation following the close of the war. However, "hard money" forces in the House fired back, and they engineered the passage of the Specie Resumption Act, a legislative salvo against paper currency. The bill directed the Treasury to begin exchanging legal tender for gold on January 1, 1879; it also mandated that the number of greenbacks in circulation be trimmed down to $300 million. Treasury Secretary John Sherman stocked up on gold and, by the dawn of 1879, the specie exchange program was up and running. But, at the same time, greenbacks had become just as valuable as gold on the exchange market; the public was reluctant to swap their paper currency for coinage and the exchange program turned out to be a flop.
1949		The Department of Justice goes trust busting and files an anti-trust suit against AT&T. The suit was designed to break AT&T's choke hold over the industry by forcing the company to relinquish ownership of Western Electric, a potent manufacturing concern. After much wrangling, the suit was settled in 1956, when AT&T consented to limit the scope of its business to the national phone network and government jobs.

January 15

1782		Superintendent of Finance Robert Morris goes before Congress to deliver a report on the young nation's finances. Morris recommended establishing a national mint and outlined plans for decimal coinage.
1975		President Gerald Ford in his very first state of the union address paints the state of the union as "not good. Millions of Americans are out of work. Recession and inflation are eroding the money of millions more. Prices are too high and sales are too low." Along with these problems, Ford offered an ominous budget estimate that showed the government running increasingly in the red over the next few fiscal years. However, Ford, who had recently been installed as the President after Richard Nixon's scandal-ridden resignation, attempted to balance the bad news by offering a remedy for America's fiscal ailments. He unveiled a relief package that featured a few rounds of tax cuts for individuals and corporations, as well as an energy program that promised to raise money, albeit through raising costs and taxes on oil for consumers and businesses.

January 16

1997

Massachusetts-based Raytheon Corp., America's sixth-largest weapons contractor at the time, acquires Hughes Electronics, which had previously been General Motors' weapons unit and then the country's fourth-largest military manufacturer. The acquisition cost Raytheon $9.5 billion: the company agreed to pay $5.1 billion in freshly issued stock, and also pledged to pick up $4.4 billion of Hughes' hefty debts. Though the deal pleased Wall Street--both Raytheon and G.M.'s respective stocks posted decent gains on the day--it raised the ire of anti-trust officials. However, in fall of 1997, the U.S. Defense and Justice departments gave the green light to the pick-up, provided Hughes divest itself of some of its previously held businesses. Though the deal left Raytheon in a seemingly potent position in the defense electronics field, the company still engaged in two sizeable rounds of layoffs in 1998.

January 17

1894		The Treasury Department issues a $50 million bond in hopes of replenishing America's sagging gold supplies. Though well intentioned, the bond issue proved to be a resounding flop: the public refused to nibble, forcing banks to buy up a good bulk of the bonds. The gold reserves continued to suffer until 1896, when Cleveland mandated a public subscription that helped staunch the bleeding.
1991		After months of lobbing threats and stern words at Iraqi leader Saddam Hussein, President George Bush orders the U.S. military into action. American forces inaugurated the Persian Gulf War by launching a full round of air strikes against Iraq, which Bush and the military cautiously deemed a success. News of the military's opening salvo sent Wall St. into a tizzy of trading and the DOW, mired in a long-standing slump, surged by 114.60 points to close at 2623.51, marking one of the biggest single-day gains in market history. Traders also defied conventional wisdom regarding the war's impact on oil prices: rather than soaring, as most experts expected, oil went into a spectacular free-fall. By the time the markets closed for the day, the price of oil had set a record for the single largest one-day decline on the New York Mercantile Exchange, spiraling to $10.56 a barrel. However, financial officials remained doubtful about the global economy's prospects for pulling out of its prolonged recession. Their fears seemed well founded: when Saddam Hussein responded with an attack on Israel later that day, the Japanese stock market promptly plummeted.

January 18

1919		Bentley Motors is established in London, England. A manufacturer of sports cars and luxury automobiles, Bentley was acquired by Rolls-Royce in November, 1931. From that point forward, the Bentley line acquired more and more features of the Rolls-Royce, until the two makes became nearly indistinguishable.
1978		Johnny Paycheck's ode to workplace frustrations, "Take This Job and Shove It," hits #1 on the Billboard charts. Paycheck, who was born Donald Eugene Lytle, enjoyed a few booze-drenched honky-tonk hits during the 1960s. He squandered his initial success and wound up performing on Skid Row in Los Angeles to earn money for drinks. But by 1978, Paycheck had mustered up a comeback and was ruling the nation's airwaves with "Take This Job," which took on a life of its own and in 1981 was turned into a middling movie starring Robert Hays of Airplane! fame. The years, however, were not so kind to Paycheck. He lapsed into self-parody, churning out pale imitations of "Take This Job" in hopes of climbing back to the top of the charts.

January 19

1881		In a desperate attempt to staunch the bleeding of its stock, Western Union snaps up the Atlantic and Pacific Company. Far from staving off the competition, the deal further fattened robber baron Jay Gould's pocketbook and primed him for the final phase of his takeover scheme. Gould convinced his Wall Street associates to start another raid on Western Union. However, as the traders were busy driving down Western Union's asking price, Gould, in the guise of an "anonymous" investor, started gobbling up the company's suddenly cheap stock. When the dust settled, Gould's cronies were left counting their losses; meanwhile, the devious financier had successfully wrested control of Western Union.
1944		U.S. rail workers settle a long-simmering wage dispute, ending the federal government's nearly month-long seizure of the nation's railroads. With the disgruntled workers threatening to shut down the country's rail lines, President Franklin Roosevelt had ordered the government to take control of the railroads on December 27, 1943. Roosevelt's tough tactics proved effective, as the rail workers quickly scrapped their plans to call a strike that would have paralyzed the nation's rail lines.

January 20

1870

Victoria Woodhull and her sister Tennessee Claflin open the doors of Woodhull, Claflin & Co., America's first brokerage firm run solely by women. The firm, which represented an early victory for equal rights in the often-chauvinistic world of Wall Street, was in part a product of the sisters' friendship with rail baron Cornelius Vanderbilt. In 1870, the sisters established a publication, Woodhull and Claflin's Weekly, which became a pulpit for their ardent beliefs in free love and women's suffrage and also served as the first venue for the English translation of the Communist Manifesto. Though her rejection of the tenets of conventional marriage raised the ire of some suffragettes, Victoria became a leading light in the women's rights movement. In 1872, the Equal Rights Party, a dissident branch of the National Woman Suffrage Association, even nominated Woodhull as their candidate for the president of the nation. Despite her stated aversion to the principles of marriage, Victoria wedded several times; later in life she headed to England and married an affluent British merchant, as did her sister.

January 21

1895		The Supreme Court handed down a judgment in the case of United States v. E.C. Knight that derailed the Sherman Anti-Trust Act, which was passed in 1890 and designed to weed out oversized businesses that blocked the "natural" flow of competition. Though the act was invoked that same year to force the break-up of Standard Oil, it was generally regarded as a limp piece of legislation that did little to stem the rise of trusts. However, that didn't stop big business from mounting charges to severely limit the scope of the Sherman Act. In E.C. Knight, the Supreme Court sided with the argument that the anti-trust legislation should distinguish between commercial and manufacturing enterprises and thus only apply to companies engaged in interstate trade. In turn, a company such as the sugar trust at the heart of the case, which "restricted" its business to manufacturing within a single state, was deemed legal, despite squashing any semblance of competition in the sugar refining industry. Whatever the legal merits of this decision, it effectively neutered any efforts to put a lid on monopolies, until the passage of the Clayton Act in 1916. Incidentally, on July 15, 1994, the U.S. government filed a complaint charging the Microsoft Corporation, the world's largest software developer, with violating Sections 1 and 2 of the Sherman Anti-Trust Act.
1899		The five Opel brothers acquire the rights to the Lutzmann automobile, and begin production. In 1898, they had begun converting the sewing machine and appliance factory of Adam Opel into an automobile works in Russelheim, Germany. The Opel-Lutzmann was soon abandoned, and in 1902, Opel introduced its first original car, a 2-cylinder runabout. In the decades that followed, Opel became one of the premier forces in the European automobile industry, modernizing its factories relentlessly and adopting the continuous-motion assembly line before its European competitors. Today, Opel is a wholly owned subsidiary of General Motors. It produces about a quarter of all German cars, and exports heavily to South America and Africa.

January 22

1932		President Herbert Hoover signs the legislation that established the Reconstruction Finance Corporation (RFC). Conceived by Hoover in 1931, and passed by the House earlier that January, the RFC was an independent agency charged with funding banks, railroads, insurance companies, and other institutions that could help kick start the moribund economy. When Franklin Roosevelt ascended to the presidency, he made the agency a key engine of the New Deal recovery program. The RFC was also a key player during World War II, making disbursements that financed America's burgeoning defense industry, as well as cash-strapped foreign governments. However, by 1951 rumors that the agency was awash in impropriety swirled around RFC, prompting congressional officials to initiate a wide-reaching investigation. The probe not only revealed an agency riddled with corruption, but pointed figures at some of the RFC's highest-ranking officials. Coupled with President Eisenhower's push to curtail the government's role in the economy, the findings effectively signaled the end for the agency. Eisenhower signed the RFC Liquidation Act into law in 1953, which effectively stripped the organization of its duties as a lender. By 1957, the RFC's remaining powers had been shuttled to other government agencies and it was shut down for good.
1981		Donald Regan takes the oath as the United States' 66th Secretary of the Treasury. With that, Regan, the former Merrill Lynch CEO who was tabbed for the Treasury post by President Ronald Reagan in late 1980, completed his move from the corporate world to the public sector. Regan's term at the top of the Treasury was not without its rough patches: he had little, if any, contact with Reagan; and though he was a staunch proponent of tax cuts for citizens in the top earnings brackets, Regan was dismissed as a "mouthpiece for Wall Street" by some of the president's more conservative supporters. Regan's run in the Treasury came to a close in 1985, when he and Secretary of State James Baker made the unusual decision to swap jobs. In the wake of the announcement, some wondered if Regan would be able to match Baker's political acumen and Beltway connections.

January 23

1964

The Twenty-Fourth Amendment to the U.S. Constitution is ratified by the South Dakota legislature. Payment of the tax stood as a potent prerequisite, and sometimes outright barrier, to voting in national elections. For the Southern Democrats who designed and helped pass the tax in a number of Southern states during the 1880s and 1890s, the poll tax was a blunt tool for barring poverty-stricken African-Americans and whites from participating in the electoral process. As such, the tax was also a means for stemming the rise of the Populist Party, which had used a racially mixed coalition of poor and lower class voters to gain a place on the national stage. Attempts to roll back the poll tax were generally blocked in the Senate. However, in 1949, Senator Spessard L. Holland of Florida took up the cause of killing the tax forever via a constitutional amendment. When the Senate finally passed the Twenty-Fourth Amendment in 1962, the poll tax remained in effect in five Southern states: Virginia, Texas, Mississippi, Arkansas and Alabama. After 1964, it was constitutionally legal in none.

January 24

1916		The Supreme Court rules in favor of the Sixteenth Amendment and paves the way for the federal income tax. Although the Constitution explicitly forbade direct taxation of citizens, the United States flirted with the notion of an income tax during the latter half of the 19th century. During the Civil War, the government briefly instituted a tax, which was repealed in 1872, but legislators casting about for ways to raise federal funds continued to push for an income tax. Congress gave the green light to a income tax bill in 1894, only to have the Supreme Court deem the tax unconstitutional on the grounds that it failed to raise revenues commensurate with the various populations of America's states. Undeterred, Congress passed the Sixteenth Amendment in 1909 that, after state ratification in 1913, effectively granted the federal government constitutional authority to levy an income tax. Again, the legislation was taken before the Supreme Court for review.
1994		The Nynex Corporation, one of New York's leading phone providers, announces the lay-offs of 16,800 workers over the next three years. Along with the cuts, which represented 20% of Nynex's work force, the company would take a $1.6 billion charge for the year. Although these moves partially stemmed from the company's disappointing fourth quarter performance, they also reflected Nynex's drive to protect its stake in one of the nation's prime communication markets.

January 25

1890

A fleet of workers whose jobs were spread throughout the coal industry band together to form the United Mine Workers of America (UMWA), which rapidly became one of America's most potent, and at times most troubled, labor organizations. In its earliest incarnation, the coal union was a close affiliate of Samuel Gompers's America Federation of Labor (A.F. of L.). The partnership not only helped legitimize the UMWA, but also shaped its politics, as Gompers's A.F. of L. placed its conservative stamp on the new coal union. By 1935, UMWA chief John L. Lewis had grown disenchanted with the A.F. of L., and Lewis and the UMWA joined forces with seven other unions to form the Congress of Industrial Organizations (CIO). The partnership didn't last long, at least for the coal workers: in 1942, the UMWA pulled up its stakes and withdrew from the CIO. On its own, the UMWA often fell prey to the anti-union tendencies of the federal government: in 1946 and 1948, Lewis and his union were found guilty of criminal contempt for failing to avert coal strikes. The UMWA persevered through the 1950s, but Lewis's retirement in 1960 badly rattled the union. By the late 1960s, the UMWA was riddled with corruption and internal struggles. The UMWA seemingly hit bottom in 1970, when reform minded president Joseph A. Yablonski, as well as his wife and daughter, were found murdered. However, a few years later, the situation turned even uglier when W.A. (Tony) Boyle, who had preceded Yablonski as the union's chief, was convicted of ordering the murders. The chaos continued until Richard Trumka's rise to the presidency in 1982: he cleansed some of the corruption and brought a modicum of stability back to the organization. In 1989, the UMWA ended its long stint as a lone wolf and joined forces with the AFL-CIO.

January 26

1907		Congress heeds the call to tame the tide of business leaders who used their wealth and influence to corrupt politicians, and passes a reform bill that barred America's corporations from making contributions to national campaigns.
1995		Cadbury Schweppes P.L.C., the British candy and cola giant whose products already included A&W root beer, Canada Dry, and Crush and Sunkist fruit colas, snaps up the Dr. Pepper/Seven-Up Company, the United States' third-biggest soft drink concern, for a price-tag of $1.7 billion. The acquisition left Cadbury Schweppes with 17% of America's $49 billion soda market, putting it just behind Coca-Cola and Pepsico in the field. Still, the acquisition of Dr. Pepper and its $829 million in debts was not without some risk, especially for Cadbury Schweppes, which was already saddled with its own debt of roughly $874 million. Wall Street, however, chose to ignore the flood of red ink and quickly warmed to the deal. Dr. Pepper's stock shot to a record close of $32.50 on the NYSE, while Cadbury's American shares climbed by $1.125 to end the day at $26.75.

January 27

1850		Samuel Gompers, one of the key figures of the U.S labor movement, is born in England. In 1863, Gompers emigrated to New York with his family and soon joined his father working as a cigar maker in various New York sweatshops. Although he became heavily involved in the cigar makers' union, Gompers was hardly an advocate of labor's more left-leaning tendencies. As he rose to prominence in the union, Gompers gradually articulated his belief in strikes and boycotts tempered by responsibility and reason. In addition, he focused almost solely on economic goals and hailed binding contracts as a key to improving the lives of workers. In 1886, Gompers spearheaded the formation of the American Federation of Labor (A.F. of L.) He ruled the A.F. of L. for 40 years, save for 1895, when a brief burst of socialist sentiment forced him out of office. Gompers shaped the A.F. of L. into his conservative ideal, leading the organization to eschew overt political affiliations, most notably radicalism, in favor of broad patriotic values. However, as employers and politicians increasingly marshaled tough tactics to quell the rising tide of labor, Gompers was forced to choose sides, and in 1908, he supported William Jennings Bryan's failed run for the Oval Office. A few years later, Gompers became a fierce ally of President Woodrow Wilson, and Gompers used the pulpit of the A.F. of L., as well as the recently formed Pan American Labor Federation, to push the government's policy in World War I. Gompers passed away in Texas on December 13, 1924.
1985		Coca-Cola, one of the stalwarts of capitalism, announced plans to sell its all-American soft drinks in the Soviet Union. With the move, Coke belatedly matched Pepsico, who, 12 years earlier, had begun distributing its colas in the U.S.S.R.

January 28

1791		Secretary of Treasury Alexander Hamilton delivers a report before the House on the establishment of a national mint. Hamilton's work helped pave the way for the authorization of the United States Mint on April 2, 1792.
1901		Andrew Carnegie donates $10 million to establish the Carnegie Institution in Washington, D.C. According to him, the Institution was designed "to encourage, in the broadest and most liberal manner, investigation, research, and discovery, and the application of knowledge to the improvement of mankind." Carnegie's lofty mission translated into an organization dedicated to research and education in "biology, astronomy, and the earth sciences."
1965		An earnings estimate is released saying GM hauled in $1.735 billion during the previous year, making what was then the largest profit reported by an American company.

January 29

1834		Workers on the unfinished Chesapeake and Ohio Canal riot after a planned strike was brutally extinguished. President Andrew Jackson swiftly called on Secretary of War Lewis Cass to send Federal troops in to quell the workers. It marked the first time Federal troops were deployed to settle a labor "dispute", and was another roadblock in the troubled history of the Chesapeake and Ohio Canal. Originally conceived as a transit and trade friendly route between the Midwest and Atlantic seaports, the canal was periodically delayed by fiscal woes, stiff competition from the Erie Canal, as well as the Baltimore and Ohio Railroad. When construction began in 1828, the canal was designed to reach Pittsburgh; by the time the project was abandoned in 1850, the waterway reached Cumberland. Flooding forced the close of the canal in 1924; it was bought by the U.S. government in 1938 and transformed into a national historic park in 1971.
1981		Dolly Parton reached the top of the charts with "9 to 5," her anthem to the daily grind. 9 to 5 was also the title and theme song of the hit movie starring Parton, Jane Fonda and Lily Tomlin as disgruntled secretaries who exact revenge on their lecherous boss, played by Dabney Coleman.

January 30

1920		The Toyo Kogyo Company, Ltd., is founded in Hiroshima, Japan. In 1960, the company began manufacturing Mazda automobiles.
1934		The House seeks to put a halt to the oscillation of the American currency's value by passing the Gold Reserve Act. The adoption of the act gave President Franklin Roosevelt license to peg the value of the dollar within a range of 50 to 60 cents in terms of gold. Roosevelt took swift action: the next day he announced that the dollar would be worth 59.06 cents, while gold would be valued at $35 per ounce. The Gold Reserve Act also paved the way for the "nationalization" of gold: as per the legislation's mandate, the various Federal Reserve banks handed control of their gold supplies, including all coins, bullion and gold certificates, to the U.S. Treasury. The U.S. Treasury shuttled a good chunk of the gold to a well-protected spot in Fort Knox, Kentucky.

January 31

1795		Wounded by the sharp criticism of his colleagues, Alexander Hamilton resigns his post as the Secretary of the Treasury. During his run as the first U.S. Treasury Secretary, Hamilton put his conservative stamp on the young nation's finances, establishing a national bank and a tax-based system to fuel the repayment of national and foreign debts. Hamilton also pushed for the Federal government to assume full responsibility for debts incurred by the states during the Revolutionary War. However, Hamilton's Federalist ardor was a frequent target for controversy, as was his role in meting out the country's neutrality stance during the early stages of the Napoleonic Wars. Hamilton's involvement in the latter bit of policy drew particularly heavy fire and helped seal his departure from office. And so, Hamilton putatively retired to lick his wounds and count his vast personal fortune. But the siren call of politics proved irresistible and Hamilton served a long stint as an unofficial presidential advisor.
1940		Ida May Fuller of Ludlow, Vermont finds a check in her mailbox from the Federal government worth $22.54. Though hardly a fortune, the check was nonetheless a milestone: it was the first monthly retirement payment made under the auspices of the Social Security Act. When the act initially passed into the law books in 1935, benefits were paid out in lump sums. But, with Fuller's check, the government kicked off its program of doling out regular benefits to retired workers. For Fuller, it was simply the first in a series of payments that lasted for the next 35 years: Before passing away at age 100 in 1975, Fuller received regular payments totaling $22,000.