1912 January, Failure of the Albion National Bank
Four years after the great flood, natural crisis was followed by man-made crisis. In 1912 the Albion National Bank failed, ruining many prominent local families.
Prior to the bank crisis Henry Dearing played a prominent role in Albion’s social and economic affairs, serving on the School Board and on the City Council. This was slight compared to his role in business, serving on the boards of significant local firms and being friend and confidant of several local industrialists.
Focusing on Dearing’s misappropriation fails to recognize a larger point, thatthe Dearing’s were not operating only in their own self interest, but in the desire to see the further growth of industry in a small town renowned in economic heritage by the Gale Manufacturing Company, and culturally for the local Methodist Church and Albion College. By encouraging the growth of Albion, Dearing was also making economic opportunity available for many first generation immigrants, newly arrived to America and newly arrived to Albion – people struggling to survive but with dreams of a better life.
Despite these good intentions, the Great Flood and Bank Crisis illustrate flaws of the gospel of progress, growth, and development. While economic development seems like a desirable goal for the people of Albion, this development is dependent on the broader economic and social structure of the nation and world, an order inherently unstable and subject to quick and rapid transformation and change. So the law of unintended consequences states that while economic development is pursued in the best interest of the people, unintended consequences cause even the best intentions to backfire and harm the people who are trying to be helped. Such was the case with Dearing and more contemporary economic development schemes.
Dearing’s actions begin to appear altruistic. He sought to stimulate growth and development in Albion against overwhelming odds. Though resulting in failure, his intentions were sound. Blame should then not be placed on Dearing exclusively, but on the broader economic and social order that he operated within.
Sadly, the Albion National Bank Crisis was only a small omen or precursor for the transformation that the nation and world would experience in the decades ahead, during a global economic recession (The Great Depression) and the greatest hostility between nations and people that the world has ever seen (World War II).
Financial shock waves rocked Albion in January 1912, with the failure of the Albion NationalBank. the U.S. Examiner had uncovered an incredible forgery scheme instituted by the bank’s cashier, to the tune of $325,000. Those responsible were sent to prison, but it was the depositors who suffered – they only regained 30 cents on the dollar. On December 4, 1912, depositors of the Albion National Bank gathered to demand their money back from the U.S. government. They met at the Albion Opera House, took a picture, and sent it with a 15 page petition to the Department of Justice.
Source: Frank Passic. A Pictorial History of Albion, Michigan; From the Archives of the Albion Historical Society. Dallas, Texas: Curtis Media Corporation. 1991.