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Theodore Roosevelt, the Election of 1912, and the Founding of the Federal Reserve

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Abstract

This paper examines how the election of 1912 changed the makeup of Congress and led to the Federal Reserve Act. The decision of Theodore Roosevelt and other Progressives to run as third-party candidates split the Republican Party and enabled Democrats to capture the White House and Congress. We show that the election produced a less polarized Congress and that newly-elected members were more likely to support the act. Absent their interparty split, Republicans would likely have held the White House and Congress, and any legislation to establish a central bank would have been unlikely or certainly quite different.

Suggested Citation

  • Matthew Jaremski & David C. Wheelock, 2023. "Theodore Roosevelt, the Election of 1912, and the Founding of the Federal Reserve," Working Papers 2023-008, Federal Reserve Bank of St. Louis, revised Mar 2024.
    • Handle: RePEc:fip:fedlwp:96067
    DOI: 10.20955/wp.2023.008
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    as
    1. Moen, Jon R. & Tallman, Ellis W., 2000. "Clearinghouse Membership and Deposit Contraction during the Panic of 1907," The Journal of Economic History, Cambridge University Press, vol. 60(1), pages 145-163, March.
    2. repec:ucp:bkecon:9780226519999 is not listed on IDEAS
    3. Jaremski, Matthew & Wheelock, David C., 2020. "The Founding of the Federal Reserve, the Great Depression, and the Evolution of the U.S. Interbank Network," The Journal of Economic History, Cambridge University Press, vol. 80(1), pages 69-99, March.
    4. Moen, Jon & Tallman, Ellis W., 1992. "The Bank Panic of 1907: The Role of Trust Companies," The Journal of Economic History, Cambridge University Press, vol. 52(3), pages 611-630, September.
    5. Milton Friedman & Anna J. Schwartz, 1963. "A Monetary History of the United States, 1867–1960," NBER Books, National Bureau of Economic Research, Inc, number frie63-1, March.
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    More about this item

    Keywords

    Federal Reserve Act; Progressive Party; central bank; Aldrich plan;
    All these keywords.

    JEL classification:

    • N42 - Economic History - - Government, War, Law, International Relations, and Regulation - - - U.S.; Canada: 1913-
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
    • P43 - Political Economy and Comparative Economic Systems - - Other Economic Systems - - - Finance; Public Finance

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