President Wilson and the International Origins of the Federal Reserve System: A Reappraisal (original) (raw)
2010, White House Studies
This paper presents a reappraisal of the international origins of the Federal Reserve Act of 1913. The most comprehensive study on the subject up to date is a book by J. Lawrence Broz. While Broz is correct to emphasize the impact of international trends in shaping the final text of the act, his account remains incomplete. The primary reason for this is that the narrative cannot account for the following puzzle: Why would Wall Street bankers fight vehemently during the fall of 1913 (an unimportant, “black box” period in Broz’s account) against a proposal that was supposed to be in their best interest? A possible explanation should focus on President Wilson’s policy entrepreneurship and strategic policy vision – both foreign and domestic . This paper demonstrates that the introduction of an autonomous presidency to the verbal model goes a long way toward explicating the puzzles that occurred during the “black box” period left out of Broz’s narrative.
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