Jeffrey D. Nichols
History Blazer, March 1995
The Great Depression lasted from 1929 until war production revived the economy in the late 1930s and early 1940s. Although conservative economists argued that the depression reflected normal cycles and should not be addressed with extraordinary measures, the high levels of unemployment and general suffering forced policymakers to seek new approaches. One of the major architects of the New Deal programs was a short, slender, seemingly ordinary Utah banker, Marriner S. Eccles.
Eccles was already an established banker and entrepreneur when he came to the attention of President Franklin D. Roosevelt’s “brain trust.” Born in Logan in 1890, Eccles worked at his father’s Oregon lumber mills and then attended Brigham Young College in Logan. After serving an LDS mission in Scotland, he returned to manage the family estate. His business activities flourished during the prosperous 1920s, and at various times, he served as president of First Savings Bank, Sego Milk Products Company, Utah Construction Company, Stoddard Lumber Company, and First Security Corporation.
Dr. Rexford G. Tugwell, one of Roosevelt’s closest advisors, invited Eccles to Washington for a number of conferences. While there he testified before the Senate Finance Committee, advocating many of the measures that would become cornerstones of the New Deal. While traditional economics stressed a hands-off, open market approach from government and balanced budgets, Eccles proposed public works to relieve unemployment and direct relief measures, as well as a minimum wage, unemployment insurance, and old age pensions. He was appointed assistant to the secretary of the Treasury and then left after ten months to become chairman of the Federal Reserve Board in 1934. Established, major bank executives initially underestimated the somewhat obscure Utahn, but Eccles’s diplomatic skills and expertise made him an influential policymaker. He wrote the Banking Act of 1935 and moved to restructure the Federal Reserve System. Although New Deal policies did not end the depression, they did help to ameliorate the worst suffering and stabilize the country’s financial structure.
During his term Eccles helped to establish the independence of the Fed from the Treasury Department. He championed the now-familiar compensatory policies of manipulating interest rates, tax rates, and currency supplies to counter harmful economic trends. When Eccles disagreed with Truman administration officials over policies, the president declined to reappoint him as chairman in 1948. Eccles remained on the Fed’s Board of Governors until 1951, and served on a number of important advisory bodies. He was the U. S. delegate to the Bretton Woods Conference that created the World Bank and International Monetary Fund.
Eccles returned to his private business and philanthropic interests in 1952, serving as CEO and later honorary chairman and director of First Security Corporation, Amalgamated Sugar Company, and Utah International Incorporated until his death in 1977. In 1982 the Federal Reserve Building in Washington, D. C., was renamed the Marriner S. Eccles Federal Reserve Board Building.
See: First Focus-Special Founder’s Day Supplement (First Security Bank), September 1990.