Denver Depression of 1893
Encyclopedia
The Denver Depression of 1893 was an economic depression of Denver, Colorado
that began in 1893 after the rapid drop in the price of silver
and lasted for several years.
of 1878 and then the Sherman Silver Purchase Act
of 1890, both of which required the U.S. government to purchase millions of ounces of silver each year. As one historian of the period noted, “Almost all economic pursuits in the state were tied in one way or another to the mining industry; consequently, almost every Colorado resident had a vested interest in its success.” But whereas the silver standard enabled western rural farmers and miners to pay off their debts, bankers in the east were losing money, as the circulation of silver was leading to a decline in the value of gold-based money (see Coinage Act of 1873, silverite
s). In 1873, those in the west lost the battle, as President Grover Cleveland
oversaw the repeal of the Sherman Silver Purchase Act
. With the Coinage Act of 1873, bimetallism
was disestablished by congress and gold was established as the standard
. This caused the prices of silver to fall, and the prices of silver continued to fall further due to an overabundance of the metal when silver was struck in Leadville
and in the San Juan Mountains
.
Unfortunately, Denver was already suffering economically due to several successive years of droughts and harsh winters that had hurt the agricultural industry
Agricultural distress, coupled with the withdrawal of foreign investors and the over-expansion of the silver mining industries, led Denver to experience its first economic depression.
to support the money in the banks. Many people in the west thus lost their life savings. And as Denver banks closed, real estate values dropped, smelters stopped working, and the Denver tramways had trouble getting people to ride and pay their fares.
Unfortunately, the miners coming into Denver found no jobs and no help.
Rescue missions initially provided tents and food, but they could not keep up with the growing number of unemployed persons in the city, and eventually they could only provide for women and children.
The People's Tabernacle was one of the largest of such efforts that had provided care for the sick. They offered a free dispensary, gave away winter clothing, and offered a free bathhouse, classes in sewing, shelter for the homeless, and medical attention for prostitutes, but they were similarly forced to limit aid to people who had been living in the city for more than 60 days.
The depression also exacerbated existing prejudices. American Protective Association
(APA) found jobs for Protestants, for example, by firing Catholics. This led 10,000 Denverites to belong to the APA after the depression started. In response, Catholic Reverend Thomas Malone infiltrated the APA with spies, seeking to embarrass its members and to weaken the party.
Several organizations formed community gardens as an attempt to help ease the shortage of food. By the fall of 1893, a tent city had appeared at Riverfront Park along the South Platte River
. The City of Commerce
gave a gift of lumber to the homeless camped in the tent city, apparently in hopes that they would build rafts and float away. During this time 450 desperate Coxeyites
abandoned their rafts in La Salle
and hijacked a train to Julesburg
where they were stopped by a posse.
By September 1893, the Colorado Bureau of Labor Statistics reported that 377 businesses had failed, 435 mines had closed, and 45,000 people were out of work.
Because of the city's inability to take care of the jobless, some train companies began offering reduced or free fares for people wanting to travel from Denver. One railroad, for instance, lowered fares to $6 on the Denver to Missouri river
route. This effort contributed to the exodus from the city, and Denver's population dropped from 106,000 in 1890 to 90,000 in 1895.
The only project that was not slowed during the depression was the building of the Colorado State Capitol. This construction effort provided jobs during the crisis, both for those working on the building itself and in the mines that could extract the marble
that was chosen in lieu of hardwood for flooring. As one historian of the time noted, “Governor Davis Waite, the board’s chairman, remained dedicated to providing jobs for the Coloradoans by using native materials as much as possible”
In 1895, The Festival of Mountain and Plains was established by Chamber of Commerce to raise peoples' spirits in a manner comparable to New Orleans' Mardi Gras
. During the festival people marched “inside the block long silver serpent” that was meant to celebrate the city's silver heritage, singing, “We spring, we sprawl, We caper, we crawl, With vesture of changeable hue. We slidingly slink, as we near the brink Of our subterranean abyss.” Department stores ran sales during the festival, and festival organizers arranged for opportunities that enabled tourists to take pictures of Ute Indian
s for a fee and to see a broadway show.
political party easily won the Colorado statehouse in 1893, and Davis Hanson Waite
was elected to the Governorship.
Governor Waite tried to overturn the corruption in Denver in 1894 by removing police and fire commissioners that he believed were shielding the gamblers and prostitutes that he believed were resulting from and also worsening the depression. Corrupt officials including the infamous Soapy Smith
and his colleagues barricaded themselves in City Hall in response, and militiamen were sent to remove them. Federal intervention prevented an all out war and the Colorado Supreme Court
ruled in favor of the governor and stated that the governor could remove commissioners.
Governor Davis Waite also suggested that Colorado should mint its own money by buying the silver the state produced and shipping it to Mexico to be minted into “Fandango Dollars.” As Waite stated, “it is better, infinitely better, that blood should flow to the horses’ bridles rather than our national liberties should be destroyed.” The public was not receptive to the idea, however, and in 1894 Albert Washington McIntire
defeated Waite for governorship.
Colorado
Colorado is a U.S. state that encompasses much of the Rocky Mountains as well as the northeastern portion of the Colorado Plateau and the western edge of the Great Plains...
that began in 1893 after the rapid drop in the price of silver
Silver
Silver is a metallic chemical element with the chemical symbol Ag and atomic number 47. A soft, white, lustrous transition metal, it has the highest electrical conductivity of any element and the highest thermal conductivity of any metal...
and lasted for several years.
Causes
The city of Denver, Colorado had enjoyed boomtown growth during the late 19th century after the discovery and development of numerous silver mines and the passage of first the Bland-Allison ActBland-Allison Act
The Bland–Allison Act was an 1878 act of Congress requiring the U.S. Treasury to buy a certain amount of silver and put it into circulation as silver dollars. Though the bill was vetoed by President Rutherford B...
of 1878 and then the Sherman Silver Purchase Act
Sherman Silver Purchase Act
The Sherman Silver Purchase Act was enacted on July 14, 1890 as a United States federal law. It was named after its author, Senator John Sherman, an Ohio Republican, chairman of the Senate Finance Committee...
of 1890, both of which required the U.S. government to purchase millions of ounces of silver each year. As one historian of the period noted, “Almost all economic pursuits in the state were tied in one way or another to the mining industry; consequently, almost every Colorado resident had a vested interest in its success.” But whereas the silver standard enabled western rural farmers and miners to pay off their debts, bankers in the east were losing money, as the circulation of silver was leading to a decline in the value of gold-based money (see Coinage Act of 1873, silverite
Silverite
The Silverites were members of a political movement in the United States in the late-19th century that advocated that silver should continue to be a monetary standard along with gold, as authorized under the Coinage Act of 1792...
s). In 1873, those in the west lost the battle, as President Grover Cleveland
Grover Cleveland
Stephen Grover Cleveland was the 22nd and 24th president of the United States. Cleveland is the only president to serve two non-consecutive terms and therefore is the only individual to be counted twice in the numbering of the presidents...
oversaw the repeal of the Sherman Silver Purchase Act
Sherman Silver Purchase Act
The Sherman Silver Purchase Act was enacted on July 14, 1890 as a United States federal law. It was named after its author, Senator John Sherman, an Ohio Republican, chairman of the Senate Finance Committee...
. With the Coinage Act of 1873, bimetallism
Bimetallism
In economics, bimetallism is a monetary standard in which the value of the monetary unit is defined as equivalent both to a certain quantity of gold and to a certain quantity of silver; such a system establishes a fixed rate of exchange between the two metals...
was disestablished by congress and gold was established as the standard
Gold standard
The gold standard is a monetary system in which the standard economic unit of account is a fixed mass of gold. There are distinct kinds of gold standard...
. This caused the prices of silver to fall, and the prices of silver continued to fall further due to an overabundance of the metal when silver was struck in Leadville
Leadville, Colorado
Leadville is a Statutory City that is the county seat of, and the only municipality in, Lake County, Colorado, United States. Situated at an elevation of , Leadville is the highest incorporated city and the second highest incorporated municipality in the United States...
and in the San Juan Mountains
San Juan Mountains
The San Juan Mountains are a high and rugged mountain range in the Rocky Mountains in southwestern Colorado. The area is highly mineralized and figured in the gold and silver mining industry of early Colorado. Major towns, all old mining camps, include Creede, Lake City, Silverton, Ouray, and...
.
Unfortunately, Denver was already suffering economically due to several successive years of droughts and harsh winters that had hurt the agricultural industry
Agricultural distress, coupled with the withdrawal of foreign investors and the over-expansion of the silver mining industries, led Denver to experience its first economic depression.
Effects
The collapse of the Silver market beginning in 1873 dropped the price of silver from 83 cents to 62 cents an ounce. Mining companies dropped their wages, yet as one historian reports, due to the overabundance of workers in the area, “employers could easily replace workers unwilling to accept pay cuts.” Then, as the silver mines began to close due to the continued drop in silver prices, unemployed miners and other workers from the Colorado mountains flooded into Denver in hopes of finding work. Seeking to address the growing tensions in Denver, politicians friendly with the silver cause met in Denver on July 12, 1873 to lend support against the repealing of the Sherman Silver Act, but to no avail. People began to withdraw their money from banks in a panic as the price of silver dropped. This caused numerous banks to collapse, as at this point there was no federal insuranceFederal Deposit Insurance Corporation
The Federal Deposit Insurance Corporation is a United States government corporation created by the Glass–Steagall Act of 1933. It provides deposit insurance, which guarantees the safety of deposits in member banks, currently up to $250,000 per depositor per bank. , the FDIC insures deposits at...
to support the money in the banks. Many people in the west thus lost their life savings. And as Denver banks closed, real estate values dropped, smelters stopped working, and the Denver tramways had trouble getting people to ride and pay their fares.
Unfortunately, the miners coming into Denver found no jobs and no help.
Rescue missions initially provided tents and food, but they could not keep up with the growing number of unemployed persons in the city, and eventually they could only provide for women and children.
The People's Tabernacle was one of the largest of such efforts that had provided care for the sick. They offered a free dispensary, gave away winter clothing, and offered a free bathhouse, classes in sewing, shelter for the homeless, and medical attention for prostitutes, but they were similarly forced to limit aid to people who had been living in the city for more than 60 days.
The depression also exacerbated existing prejudices. American Protective Association
American Protective Association
The American Protective Association, or APA was an American anti-Catholic society similar to the Know Nothings.-History:The APA was founded 13 March 1887 by Attorney Henry F. Bowers in Clinton, Iowa...
(APA) found jobs for Protestants, for example, by firing Catholics. This led 10,000 Denverites to belong to the APA after the depression started. In response, Catholic Reverend Thomas Malone infiltrated the APA with spies, seeking to embarrass its members and to weaken the party.
Several organizations formed community gardens as an attempt to help ease the shortage of food. By the fall of 1893, a tent city had appeared at Riverfront Park along the South Platte River
South Platte River
The South Platte River is one of the two principal tributaries of the Platte River and itself a major river of the American Midwest and the American Southwest/Mountain West, located in the U.S. states of Colorado and Nebraska...
. The City of Commerce
Commerce City, Colorado
The city of Commerce City is a Home Rule Municipality located in Adams County, Colorado, United States. Commerce City is a northern suburb of Denver and now the 18th most populous municipality in the state of Colorado...
gave a gift of lumber to the homeless camped in the tent city, apparently in hopes that they would build rafts and float away. During this time 450 desperate Coxeyites
Coxey's Army
Coxey's Army was a protest march by unemployed workers from the United States, led by the populist Jacob Coxey. They marched on Washington D.C. in 1894, the second year of a four-year economic depression that was the worst in United States history to that time. Officially named the Army of the...
abandoned their rafts in La Salle
La Salle, Colorado
La Salle is a Statutory Town in Weld County, Colorado, United States. The population was 1,849 at the 2000 census.-Geography:La Salle is located at ....
and hijacked a train to Julesburg
Julesburg, Colorado
The historic town of Julesburg is a statutory town that is the county seat of Sedgwick County, Colorado, United States. The town is located on the north side of the South Platte River. The population was 1,467 at the U.S. Census 2000...
where they were stopped by a posse.
By September 1893, the Colorado Bureau of Labor Statistics reported that 377 businesses had failed, 435 mines had closed, and 45,000 people were out of work.
Because of the city's inability to take care of the jobless, some train companies began offering reduced or free fares for people wanting to travel from Denver. One railroad, for instance, lowered fares to $6 on the Denver to Missouri river
Missouri River
The Missouri River flows through the central United States, and is a tributary of the Mississippi River. It is the longest river in North America and drains the third largest area, though only the thirteenth largest by discharge. The Missouri's watershed encompasses most of the American Great...
route. This effort contributed to the exodus from the city, and Denver's population dropped from 106,000 in 1890 to 90,000 in 1895.
The only project that was not slowed during the depression was the building of the Colorado State Capitol. This construction effort provided jobs during the crisis, both for those working on the building itself and in the mines that could extract the marble
Marble
Marble is a metamorphic rock composed of recrystallized carbonate minerals, most commonly calcite or dolomite.Geologists use the term "marble" to refer to metamorphosed limestone; however stonemasons use the term more broadly to encompass unmetamorphosed limestone.Marble is commonly used for...
that was chosen in lieu of hardwood for flooring. As one historian of the time noted, “Governor Davis Waite, the board’s chairman, remained dedicated to providing jobs for the Coloradoans by using native materials as much as possible”
In 1895, The Festival of Mountain and Plains was established by Chamber of Commerce to raise peoples' spirits in a manner comparable to New Orleans' Mardi Gras
Mardi Gras
The terms "Mardi Gras" , "Mardi Gras season", and "Carnival season", in English, refer to events of the Carnival celebrations, beginning on or after Epiphany and culminating on the day before Ash Wednesday...
. During the festival people marched “inside the block long silver serpent” that was meant to celebrate the city's silver heritage, singing, “We spring, we sprawl, We caper, we crawl, With vesture of changeable hue. We slidingly slink, as we near the brink Of our subterranean abyss.” Department stores ran sales during the festival, and festival organizers arranged for opportunities that enabled tourists to take pictures of Ute Indian
Ute Tribe
The Ute are an American Indian people now living primarily in Utah and Colorado. There are three Ute tribal reservations: Uintah-Ouray in northeastern Utah ; Southern Ute in Colorado ; and Ute Mountain which primarily lies in Colorado, but extends to Utah and New Mexico . The name of the state of...
s for a fee and to see a broadway show.
Politics
With the rising opposition to the Republican efforts that had supported the gold standard that had contributed to the crash of the silver industry, the PopulistPopulist Party (United States)
The People's Party, also known as the "Populists", was a short-lived political party in the United States established in 1891. It was most important in 1892-96, then rapidly faded away...
political party easily won the Colorado statehouse in 1893, and Davis Hanson Waite
Davis Hanson Waite
Davis Hanson Waite , U.S. Populist Party and Democratic Party politician, served as the eighth Governor of Colorado from 1893 to 1895...
was elected to the Governorship.
Governor Waite tried to overturn the corruption in Denver in 1894 by removing police and fire commissioners that he believed were shielding the gamblers and prostitutes that he believed were resulting from and also worsening the depression. Corrupt officials including the infamous Soapy Smith
Soapy Smith
Jefferson Randolph "Soapy" Smith II was an American con artist and gangster who had a major hand in the organized criminal operations of Denver, Colorado; Creede, Colorado; and Skagway, Alaska, from 1879 to 1898. He was killed in the famed Shootout on Juneau Wharf...
and his colleagues barricaded themselves in City Hall in response, and militiamen were sent to remove them. Federal intervention prevented an all out war and the Colorado Supreme Court
Colorado Supreme Court
The Colorado Supreme Court is the highest court in the U.S. state of Colorado. Located in Denver, the Court consists of a Chief Justice and six Associate Justices.-Appellate jurisdiction:...
ruled in favor of the governor and stated that the governor could remove commissioners.
Governor Davis Waite also suggested that Colorado should mint its own money by buying the silver the state produced and shipping it to Mexico to be minted into “Fandango Dollars.” As Waite stated, “it is better, infinitely better, that blood should flow to the horses’ bridles rather than our national liberties should be destroyed.” The public was not receptive to the idea, however, and in 1894 Albert Washington McIntire
Albert Washington McIntire
Albert Washington McIntire was an American Republican politician. He was the ninth Governor of Colorado from 1895 to 1897...
defeated Waite for governorship.
People
Many of Colorado's most renowned residents of the day suffered as a result of Denver's depression of 1893:- Henry Brown-Owner of Brown Palace Hotel spent his last years fighting off creditors who were trying to take over his hotel.
- John EvansJohn Evans (governor)John Evans was a U.S. politician, physician, railroad promoter, Governor of the Territory of Colorado, and namesake of Evanston, Illinois; Evans, Colorado; and Mount Evans, Colorado...
lost his title of the Railroad Building at 15th and Larimer. - Horace Tabor lost everything in the silver collapse, representing a monumental reversal of fortune in that at one point Tabor had possessed one of the largest fortunes out of Colorado mines and had overseen a substantial number of the state's mines and real estate titles. Tabor was only saved from destitution in 1898 by his appointment to Postmaster, a position he held until he died 1899
- William Lang, architect of Molly Brown HouseMolly Brown HouseThe Molly Brown House Museum is a house located at 1340 Pennsylvania Street in Denver, Colorado, United States that was the home of American philanthropist, socialite, and activist Margaret Brown. Brown was known as "The Unsinkable Molly Brown" because she survived the sinking of the RMS Titanic...
, became an alcoholic during the depression, and was hit and killed by a train in Illinois. - Francis SchlatterFrancis SchlatterFrancis Schlatter was an Alsatian cobbler who, because of miraculous cures attributed to him, became known as the Healer.-Biography:...
, a leader who gained notoriety for appearing as a bearded “Christ-like figure” in the summer 1895 (he had appeared previously in Denver for several months in 1892), supposedly cured the blind, the disfigured, the crippled, and did not ask for payment. After thousands of people lined the streets to be touched by him during that summer and fall, Schlatter disappeared in November 1895 leaving this note: “My mission is finished. Father takes me away. Goodbye. Francis Schlatter.” - An Italian bartender was put in jail for killing a man who could not pay the 5 cents for his beer. Afterwards, an angry mob broke into the jail, dragged the bartender out, hung him, shot him and drug his body through the streets.