In 1893, the USA suffered a huge “panic,” or economic recession – larger than it had ever experienced before.
William McKinley: The Panic of 1893
In 1893, the usual collision of factors that create recessions occurred – with the usual results. Factories closed, mines closed, entire towns became near-ghost towns. People lost jobs, there was widespread unrest, complete with strikes (illegal) and anarchistic rumblings (frightening).
Congressman William McKinley, a man with many friends.
William McKinley (1843-1901) was a rural Ohioan, born into a large and rather poor family – but hard work, education and devotion to their Methodist faith was in ready supply. After serving for a full four years in the Union Army, earning him a brevet rank of Major, he returned to law school, became an attorney, moved to nearby Canton and opened a practice. Always genuinely likable and outgoing by nature, he prospered, made dozens of friends, and married the daughter of the richest man in town.
One close friend was one he had known since his schooldays. Robert L. Walker had done well in life. He had lent McKinley the money for law school, and made generous contributions to all McKinley’s congressional campaigns. Thus, when Walker needed a favor so he could open a tin plate manufacturing company, he asked McKinley to co-sign a bank loan. Happy to be able to repay Walker’s generosity, McKinley obliged – to the tune of $17,000, so he thought. He was never one to delve deeply into his own financial situations.
Walker had not been completely up-front with his old friend however, and the complications of the transaction actually amounted to well over $150,000 – more like $2.8 million today. Then the “Panic” began, and Walker defaulted and declared bankruptcy, leaving poor McKinley holding the empty bag.
There was one more complication: In 1893, William McKinley was a popular Governor of Ohio, looking forward to reelection – and shortlisted for the Presidency in 1896.
“No Man is a Failure Who Has Friends….”
..so sayeth Mark Twain.
There were few public men in America who had more friends in both high and low places than William McKinley.
Young Billy McKinley
Even as a young soldier, and despite his total lack of vices-of-camaraderie, such as smoking, drinking, dancing, gambling, playing cards, swearing and chasing women (and probably more), William McKinley was never perceived to be priggish or unmanly. He was popular. His lifelong mentor and good friend was his commanding officer, General-turned-POTUS Rutherford B. Hayes. It was Hayes who suggested “young Billy” study law.
As a young lawyer, McKinley was a joiner of every club and organization in town – from the Masons to the Elks, and the Methodist Church to the Grand Army of the Republic, a veterans group with a million members. And of course, the Republican Club. He made friends easily, and once made, they would be lifelong.
Ida McKinley was devoted to her husband.
When he married Ida Saxton, he was warmly embraced by her family, who owned property, the newspaper and the bank in Canton. Life was good.
As a young attorney, he defended some mine workers (at no charge) struggling to advance their lot in life. They had been arrested after participating in an “illegal” strike. McKinley won the case, had them acquitted, and his reputation as a lawyer (and as a friend of the working man) spread. For life.
Coincidentally, that same case brought him into contact with the mine owner, a man named Marcus A. Hanna, who not only thought highly of the young McKinley, but became his ardent supporter and dearest friend. For life.
During McKinley’s seven terms in Congress, dozens of other prominent men became his friends. These were not merely “political” friendships, although there were many of those. These men became close, personal friends. For life.
…In High and Low Places
Governor McKinley was blindsided by the co-signed loan. It was not only a huge personal problem, it was a huge potential scandal-in-situ. He was guilty of no wrongdoing, but he nevertheless insisted he would resign from the governorship, return to law practice and pay off all debts.
His friends in high places with heavy wallets were not about to let that happen. They offered to pay off the debt themselves, but McKinley wouldn’t hear of such a thing! So his friends called a meeting – followed by calls to the banks begging for a moderate grace period so decisions and appropriate repayment mechanisms could be put into place. The banks obliged.
Myron Herrick
Marcus A. Hanna
Ida McKinley, the Governor’s frail and chronically ailing wife was included in that meeting. Her father had died recently, leaving her a sizable fortune of more than $80,000 – well over a million dollars today. Without hesitation, she offered to put the entire sum in her husband’s hands, saying, “My husband has done everything for me all my life. Do you mean to deny me the privilege of doing as I please with my own money to help him now?” McKinley’s friends were not about to let that happen either.
H.H. Kohlsaat
The upshot of the meeting was to establish a trust fund, organized by several wealthy friends-of-the-Governor, including Mark Hanna, Myron Herrick and H.H. Kohlsaat as trustees. The McKinleys placed all their property in the hands of the trustees, who then went on to collect voluntary “contributions” to pay off the outstanding notes. The public was very sympathetic to their Governor’s plight, and the contributions came from high and low sources, and in particular, a dollar or two from hundreds of miners who had been befriended by McKinley some twenty years earlier.
By the end of 1893, the notes had not only been paid, but the McKinley’s property had been returned to them.
There was no scandal.
There were no glaring headlines.
McKinley was easily re-elected Governor of Ohio.
Four years later, he was elected President of the United States.
Sources:
Leech, Margaret, In the Days of McKinley – Harper & Brothers, 1959
Morgan, H. Wayne – McKinley and His America – Syracuse University Press, 1964
Philips, Kevin – William McKinley – Times Books, 2003
https://www.whitehouse.gov/about-the-white-house/presidents/william-mckinley/
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