Oral History Program Spencer Fox Eccles Interviewed by John Sillito 13 June 2006 Oral History Program Weber State University Stewart Library Ogden, Utah Spencer Fox Eccles Interviewed by John Sillito 13 June 2006 Copyright © 2011 by Weber State University, Stewart Library Mission Statement The Oral History Program of the Stewart Library was created to preserve the institutional history of Weber State University and the Davis, Ogden and Weber County communities. By conducting carefully researched, recorded, and transcribed interviews, the Oral History Program creates archival oral histories intended for the widest possible use. Interviews are conducted with the goal of eliciting from each participant a full and accurate account of events. The interviews are transcribed, edited for accuracy and clarity, and reviewed by the interviewees (as available), who are encouraged to augment or correct their spoken words. The reviewed and corrected transcripts are indexed, printed, and bound with photographs and illustrative materials as available. The working files, original recording, and archival copies are housed in the University Archives. Project Description The Utah Construction Company/Utah International Inc. Oral History Project was created to capture the memories of individuals associated with the company. Several of the interviewees are family and relatives, others are personalities involved with Utah Construction Company/Utah International Inc. and some of the company’s prominent figures. ____________________________________ Oral history is a method of collecting historical information through recorded interviews between a narrator with firsthand knowledge of historically significant events and a well-informed interviewer, with the goal of preserving substantive additions to the historical record. Because it is primary material, oral history is not intended to present the final, verified, or complete narrative of events. It is a spoken account. It reflects personal opinion offered by the interviewee in response to questioning, and as such it is partisan, deeply involved, and irreplaceable. ____________________________________ Rights Management This work is the property of the Weber State University, Stewart Library Oral History Program. It may be used freely by individuals for research, teaching and personal use as long as this statement of availability is included in the text. It is recommended that this oral history be cited as follows: Spencer Fox Eccles, an oral history by John Sillito, 13 June 2006, WSU Stewart Library Oral History Program, University Archives, Stewart Library, Weber State University, Ogden, UT. iii Spencer Fox Eccles with President F. Ann Millner 2007 1 Abstract: The following is an oral history interview with Spencer Fox Eccles (born 1934). It was conducted by John Sillito of Weber State University on June 13, 2006. In the interview, Mr. Eccles describes the life and personality of his uncle, Marriner Eccles, the Eccles family, and the history of Utah Construction/Utah International. Lisa Largent was also present during the interview. JS: This is an oral interview with Spencer F. Eccles, in his office in Salt Lake City, Utah. It is being conducted on Tuesday, June 13, 2006. The interviewer is John Sillito, with additional questions posed by Lisa Largent. This interview is part of our ongoing efforts to document Utah Construction/Utah International. I‟d be interested in your earliest recollections of Marriner Eccles as a way of starting, but then broadening it to understand him as an individual: your perception of his strengths and his abilities. SE: I can‟t place when I first met Uncle Marriner. I would say it was in the middle of the „50s, while I was still in college. He‟d come back from the Fed and had written his book Beckoning Frontiers which was a text for me in banking and finance at the University of Utah business school. But Marriner Eccles the man, that‟s a big description. Certainly, he was from humble beginnings, thrust into responsibility at an early age—first and foremost for his family and his mother, Ellen Stoddard Eccles, who was the second wife of David‟s polygamous marriage. He was a man of integrity and moral values that came out throughout his life. He became a man that accepted responsibility. He was someone who felt very responsible to his family, to his fellow workers, his associates, to the people of the state of Utah, 2 and to the nation. In other words, to his fellow man. He was an independent thinker. He was someone who was relentless in his pursuit of answers, of solving problems. He was very diligent in his diagnosis of a problem, and in gathering the facts and testing them against his background, his knowledge, and his conscience. As an independent thinker he would—because of his research— come to his conclusions and then he was fearless in defending them. It was really something to behold. He was small in stature. He was very focused in the things that he did. This ongoing sense of responsibility is why he stayed in government—because of what he thought he could accomplish to help the country get out of the Great Depression. He had to accept the pressures and the results for his family, on his marriage and on his children. The books will tell you about what that meant to him, and how he was torn as to his duty to his country and his duty to his family, and trying to make them be compatible and work together under terrific pressures and strain and sobering responsibilities. The responsibility came to him at a young age—at age 21—when David Eccles, his father, passed away in 1912. He was the only child who was of age. All the rest were younger: his sister, Marie; then my dad, Spencer; and then Jess; then Em [Emma]; and Uncle George, who worked with Marriner closely in the bank all those years; and then Noni [Nora]; and Ellen; and then the last son, the fourth son, baby Willard Eccles. So that was the second family, and he had to take on these responsibilities at a young age. There was no time for college; he barely finished high school before he was thrust into it. There was no place to hide and, apparently, there was no feeling that he should. It was just a natural, 3 disciplined step forward to take care of his mother. The Eccles estate gave five-sevenths to the first wife and two-sevenths to the second family. The second wife had no rights; she received nothing except what David had given to her during her life. It was during this time that he was mixed with the older members of the management of the first family, and the companies that were left by David Eccles, and the success of those companies, of which he represented a minority shareholder position. They struggled, and the results were not as good as they had been under David. We came to World War I, and the success should have been there, but it was not. Ultimately, he got in position through the sale of the Seagull Milk Company to Pet Milk to have the financial resources, in cash, to ask for a buy or a sale on the second family‟s position as a minority shareholder in these companies—such as Utah Construction, Amalgamated Sugar, Oregon Lumber Company, and the small banks. And so, the long and the short of it is, the second family ended up taking part of the assets and the first family took the other part of the assets. The part that came to the second family—my side of the family—Marriner was able to lead very successfully; and George then coming to the fore in 1922 in the merger of the banks in Ogden. And the history books are replete with the story, the logic, the occurrences, the realities of the Great Depression, and the success that was enjoyed by Marriner and his brothers‟ management of the resources. The other side of the family had more degree of difficulty and less success. 4 So, Marriner saw first-hand, here in the West, the devastation of the Great Depression. He saw the risk to the banks that were in this region, and, most importantly, the risk to the banking combine that had been put together by himself and assisted by George Eccles and the Browning family. The risk to all banks, then, was a risk to the First Security system of banks. From „22 to „28 they bought banks, and then had enough banks to form the First Security Corporation in 1928. Two years later, of course, the Great Depression hit. Marriner could see the devastation to the people and he was most concerned. There was the risk to the banking of the Eccles family and the region, the joblessness, the hopelessness, the suffering of the people of Utah. He came to the conclusions that what was being done in the country—calling for a balanced budget—was exactly, in his analysis, the wrong thing. What we needed was to get purchasing power in the hands of the mass consumer, so that they could buy the products that could be produced. But with no one buying them, the producers were laying people off, joblessness went up, profits went down—were nonexistent— companies failed, and it was a syndrome that just fed upon itself. He felt something needed to be done. He called it, ultimately, “compensatory fiscal policy,” which was that you would have the government step in where the private sector was paralyzed or unable to make progress, and to use deficit financing to create a situation where you could have jobs and you could have purchasing power in the hands of the mass consumers; then you could buy the products and create the profits. You would have the system escalate up instead of going down. That‟s what he espoused out here, along with 5 a lot of other things, including a minimum wage, insurance for bank deposits, public works programs, and the government operating at a deficit to bring us out of the depths of the Depression. This was the worst of all the depressions. There was hopelessness in the country, approaching the potential for anarchy, and the whole American way of life was under threat. So that‟s what he did. He spoke on it, and as things would happen, he became known in Washington; ultimately, he was asked to testify before Congress. He shocked them; he was considered to be a radical by then— a millionaire from the West and a Mormon—which really upset the folks in power. Roosevelt had come in…„32? JS: Thirty-two, yes. SE: And so, the long and the short of it was that Roosevelt asked him to come back as an assistant to the Secretary of the Treasury, [Henry] Morgenthau. From that point, he appointed him to be the head of the Federal Reserve, which had been started in 1913, under the guiding hand of Senator Carter Glass. And Marriner said that he had all these responsibilities out here in Utah, but if the President would support a program…Well, the President said, “Outline it for me.” Marriner did, and the President said, “I will support it if you will come to the Federal Reserve.” That program became the Banking Act of 1935, which set up the Federal Reserve as a true central bank, which brought the power of the Fed back from Benjamin Strong in New York City to the central government in Washington D.C., and under the board. It had been allowed to go out and it was under the control of the bankers. That is not what you call a central bank, that‟s 6 independent. So this legislation was fought through with some compromises. President Roosevelt supported it and it was passed. Chairman [Paul] Volker has called Marriner the “father of the modern Federal Reserve.” It had to do with open market operations where the government could influence a supply of money as it tried to lean against the winds of inflation, and look to employment and stability in the monetary medium of exchange, and the country as a whole. And that was, you know, almost heretical. The American Bankers Association fought this; of course, the New York Fed did, too. But anyway, it was passed, and Marriner went back to Washington for seventeen months and ended up staying seventeen years. He ended up with a divorce, and his family living and growing up out here while he was totally engrossed in trying to help the people of this country through the central bank and through his philosophy on how government should operate with the fiscal side, and the Congress, the administration, and the now-independent central bank. JS: You‟ve used the term “responsibility” several times. Let‟s talk about that for a minute. I‟m getting the sense that his view of responsibility—be it when, at age twenty-one, he has to become the responsible person, or in the midst of the Great Depression when he realizes there‟s going to be some personal sacrifice— is, in both instances, and perhaps many others, at the heart of his decision making. He feels the responsibility that the right thing needs to be done. Is that a fair characterization of his philosophy? SE: Well, it‟s the single best word that is the umbrella to many other adjectives that you could put in there, but there‟s no question that he was a problem-solver, that 7 he would take on the responsibility that was there. He didn‟t have to move forward. He didn‟t have to move as forcefully as he did. He could have relied on the other side of the family, which, of course, he did to start with because they were older, and they were in charge—they had the controlling interest. So, yes, I think that covers it, but once they offered the program to come to Washington, he said, “Well, you know, I‟ve been espousing all this, now I have to fish or cut bait.” JS: Sure. SE: And so he decided to go back there, but he was concerned about going back and staying only so he could bring his children home at the end of a school year. And, of course, that didn‟t happen. The whole time that he was at the Federal Reserve—it wouldn‟t happen today—he was also president of Utah Construction. JS: And involved in other businesses, as well. SE: Well, he was, but not to the same degree. JS: Sure. SE: I don‟t know that he had a blind trust. He had the stock in the other businesses; he didn‟t have to divest, but he didn‟t remain an officer of those. He certainly remained an officer and was the leader of Utah Construction. It was Marriner who sought out and brought in Ed Littlefield—Edmund Wattis‟ grandson—to be chief financial officer. I‟ve always thought of the relationship as almost a father-son relationship; a mentor and a disciple, originally. It was a brilliant choice; Ed Littlefield grew to be a brilliant manager, operator, and executive, but always within the context of the team approach. Marriner saw the strategy, the big-picture, and the long-term; he was the decision maker and the final arbitrator of 8 the choices that were presented to them. Ed said when we dedicated the David Eccles School of Business—I had him come up and be our luncheon speaker to give the Utah Construction point of view—because it was the stock that Aunt Em [Emma] left that was the $15 million endowment for the naming of the school after David. So Ed came up to speak on it. The important thing is that they really reinvented themselves at least three times… JS: Utah Construction? SE: Utah Construction. Maybe you could call it four distinct personalities for the organization from the heavy construction—and, of course, you know this from the five years that you put the symposiums together at Weber State. So, it‟s an extraordinary story of American free enterprise success, the efficacy of that, and what can come from that. I read over the address by Ed Littlefield at the dedication of the David Eccles School of Business on October 7, 1999. Once again, because of the creation of value for the stockholders of Utah Construction, through these different iterations, this growth curve under Marriner and Ed‟s leadership—the reinventing of themselves to adjust to the realities of the marketplace, rather than staying as they were straight through—is significant. JS: And the ability to do that even though they knew any given decision was going to raise a certain amount of antagonism—be it in the family or in the company, be it selling the ranch or moving from construction into mining. SE: All of those were big decisions for them. One of the key decisions, of course, which would have been fateful, would have been the liquidation of the company, which was considered. But going from heavy construction and then to mining, 9 and the uranium side of the mining, the iron ore side, and then into the heavy shipping, and the relationship with Peru, and with Australia and Japan…those were three of the iterations right there. And then, before Marriner passed away, they decided that the future for them at this size was not to stand alone in the natural resource area. They decided they were now in the big time. Because of the instability of the government of Peru and the unfriendly environment of the Australian government, they decided to sell, and then to sell to something as big and successful as General Electric, and then to do it on a basis where the value exchange made it the biggest corporate merger in history up to that point in time. JS: Exactly. SE: And the rest is history! Jack Welch was looking at what had been bought and seeing the future for the natural resource part—selling off a big chunk of what had come over from Utah Construction to Broken Hill in Australia. That was a brave decision on his part, after the brilliant decision by Marriner and Ed, and it left General Electric without the burden of what happened in the area of natural resources. From Marriner‟s point of view, it created value across the board to augment the value of Amalgamated Sugar, and of course, First Security Corporation, and the Anderson Lumber Company—which was the Stoddard Lumber and the David Eccles Company merged in with the Anderson. The control was within the Eccles family. That created the resource growth, the wealth that came from that, and now those nine members of the family are gone and seven of them left foundations. Foundations weren‟t available and things 10 hadn‟t happened when my dad died in 1965. And then Ellen Eccles and her son were murdered in a robbery and so they didn‟t have a foundation. Marriner‟s foundation is the Marriner Eccles Foundation, which continues the things that he believed in. He has fellowships on political economy, treatises that are written each year and selected; he has a chair at Stanford; he has the Marriner Eccles Library at the University of Utah—after we talked him into not leaving it to the Library of Congress. That‟s the best record of the Treasury and Federal Reserve from 1934 to 1951 that‟s available in the nation. I‟m president of his foundation and I‟m president of George‟s foundation; I‟m on Noni‟s and I‟m on Em‟s, and then I have my own foundation now also. So there are seven, plus mine makes eight, and my sister‟s makes nine. There are other foundations, now, in the descendants of the other members of the family. Some of the sisters have children that have foundations. And all of this pours back to benefit, in large measure, the things that those individuals believed in and supported before their deaths. JS: You mentioned that his own, personal education was somewhat limited and major responsibilities were thrust upon him at an early age. What was the process of his self-education in the years after that? You mentioned that his autobiography was a textbook when you were in business school. This is a man who had an amazing impact, not just on the Fed—which he did—but on the whole governmental policy. He is, in many ways, a thoughtful, intellectual person, but it‟s kind of self-education. How did he do that? 11 SE: He was relentless and focused, diligent in solving problems and in whatever it was that he was working on. His background thrust him into where he had the decision to run this multitude of different companies, representing other people, with this great legacy of his father, David Eccles, which would be a shadow cast over everything. Then there was the degree of disagreement with the other side of the family and the management of the resources, and the separating of the two and having the resources, then having the Great Depression come in where everything was at risk. So once again, he was thrust into something, not necessarily of his own making. Then, looking on a national basis that this thing was just spiraling downward, and the pain, the agony, and the despair of the country, of his fellow Utahns, of his fellow Americans. So he was thrust into trying to solve that problem, but he had the background. His laboratory was running the companies; he saw the effect of it on the companies, on the products, on the people, on the profits, on the success and the chance for complete loss of everything. And then he saw the big picture of the nation that this thing was heading down the track of anarchy if it continued. And so, with that background, and that learning—he‟s getting the learning and the hands-on-learning all the time—he was able to formulate his conclusions. And then with this independent thought—it was backed up not by the book, not by the academicians, not by the theorists—he arrived at his conclusions, which were also being arrived at in a different fashion by John Maynard Keynes: the Keynesian Theory. But Marriner had never heard of Keynes and had never read him, at that time. He was asked by the President of the United States, “Will you come back and do this?” And he 12 said, “Well, I can‟t leave Amalgamated, First Security, Anderson, and Utah Construction. I mean, we‟re in deep, deep trouble out here.” This is 1933; we‟re at the depths of despair. Sheep prices, cattle prices, land prices, mineral prices… everything is gone to hell in a hand basket. So Marriner said, “I‟ll go for seventeen months.” JS: Responsibility again. SE: Yes, and because he had to successfully defend his concepts, he did it. But he did it on his own terms. And there‟s where the independent thought meshed with the courage and the ability to defend. He was very well reasoned. His positions were well reasoned, worked out in the crucible of his own mind. He pounded on them and pounded on them. He didn‟t just shoot from the hip and then try to hang on to them. He believed in them, he tried them; he looked at them in his own companies. This was as clear as day to him: people can‟t buy anything because they haven‟t got a job, and they haven‟t got a job because the company can‟t sell the product to the people that don‟t have jobs. You have to get purchasing power in the mass consumer if you‟re going to have mass production. Only this was a coordinated worldwide downturn. JS: He really makes a big step to go with Roosevelt. SE: He‟s a Republican. JS: It wasn‟t that there weren‟t other Republicans in the Roosevelt administration, there were. But this is a major step, and he‟s one of the few people that stayed through the entire Roosevelt administration and into the Truman administration. 13 So this is a major step away—perhaps from some past family loyalties. Yet, in 1952, Marriner runs for the U.S. Senate in Utah as a Republican. SE: That‟s right. He runs for the U.S. Senate, and his party line was “Eccles and Ike Think Alike.” I still have a poster. JS: Oh, what a great slogan! SE: He didn‟t make it out of the primaries; they thought he was a Democrat and that didn‟t sell. We lost the opportunity to have a great spokesperson in the United States Senate, but we also gained the benefit of having him stay out here, actively engaged in Utah Construction, First Security, and Amalgamated Sugar— the big three of the Eccles empire at that time. He had already been the representative of the United States to the Bretton Woods Conference that set up the World Bank and the International Bank for Reconstruction and Settlements and Development. So he had represented the United States in the highest areas of global finance. He fought inflation during the war, but he had to cooperate in order to finance the war because we had to win. But then he wanted to not have the inflation that would follow. But the OPA [Office of Price Administration] was disbanded afterwards, against his admonition. Suddenly you had all this money looking for a few products, which spells inflation, and it went out the door. We basically ran this country with inflation as a major part of it until 1979 when [Paul] Volker stepped forward and thrust us into the deepest recession since the Great Depression. 14 Now, the independent central bank is respected and cooperates with the Treasury. They run together, as they should, with the fiscal policy and the monetary policy—not always right in a parallel course—but it wasn‟t like that with Marriner. He was constantly thrust into confrontation, first with Morgenthau, and later with [John Wesley] Snyder, who were secretaries of the Treasury. They weren‟t wanting to finance with deficit spending, and of course, with the war we didn‟t need to. The war brought us finally, fully, out of the Depression, and put us into boom times, right up into Korea. JS: Clearly he emerges as an internationalist. I mean, part of what‟s happening in that „52 campaign is the struggle within the Republican Party itself. The Utah Republican Party is more in the order of Robert Taft; Marriner Eccles is articulating an internationalist policy. Later, he comes out against the war in Vietnam. It has a huge impact. SE: He was the first businessman to speak out loudly and effectively—with the platform to speak from and the credentials to make it be heard—on the folly of Vietnam. JS: And people listened when he said it. SE: And he finally ended up saying it to Johnson himself in the White House… JS: Really? SE: …to which he never was invited back. He voted for the man; he didn‟t always vote Republican. He voted for the person that could do the best job. And he became such a supporter of Planned Parenthood, because he thought it was ridiculous to have governments trying to cure disease and lengthen the average 15 life for the people of the world, while at the same time doing nothing to balance or control the growth in birth—particularly in those areas where they couldn‟t afford the children. If they couldn‟t feed the children, you had famine and you had death, and the tragedy of that. So, he was a most outspoken leader, which of course, did not sell in the state of Utah, but he left the clear instruction to us and the foundation, and we continue to support Planned Parenthood in the planned part, not anything with the early termination of a conception—abortion. That, as I understand, never came into his thinking; it never was something that he advocated. He was trying to do preventative maintenance, not after-the-fact elimination. Another thing was the recognition of Red China. He was in that early because it was just so obvious to him that you couldn‟t take a country that size with that population and those resources, whether it was Communist or not. You couldn‟t just John-Foster-Dulles it. Those were the three big areas: population explosion and the resulting hunger problem, the Vietnam folly of trying to have a battle like that a few thousand miles away, and the recognition of Red China. I think that it‟s perfectly clear on Vietnam how early and how right he was. And I think that anybody who sleeps indoors is going to see that it‟s the same thing for the recognition of Red China. We better recognize it now. They are graduating tens of thousands of scientists and engineers; the United States education system is broken and we‟re not doing that. You look at what was stated by Queen Victoria that the big mistake Great Britain made was not educating and reinvesting, and doing the research and development. And so, the sun never set 16 on the British Empire, but a hundred years later, they‟re a second-rate power. That‟s an interesting concept, and some of us don‟t like where we‟re headed as a country right now in the long-term context of our own grandchildren. We‟re trying to do something about it. But it‟s a big problem. So Marriner came back from the Federal Reserve then, after having initiated—exploded—the so-called “Accord,” wherein the Fed quit pegging interest rates. That caused Truman not to reappoint him as chairman in 1948, when Truman had said that he would do that. We believe that to be political, and Truman had a tough race: California was a big state; [A. P.] Giannini had crossed swords with the chairman of the Federal Reserve, namely Marriner Eccles, and made it abundantly clear so Truman backed off. In 1958, when I was at Columbia Business School, Truman came to speak to us. I went to the stage afterwards and he leaned over to shake my hand. I told him who I was and he blanched. I won‟t go into the rest of the conversation! But, Marriner moved down out of the chairman‟s office to another office. He stayed on from „48 until „51, until the Accord came up, wherein Truman and [John Wesley] Snyder did not tell the truth. He released a confidential memorandum of the Fed, and that caused the Accord, which ended the policy of pegging currencies, which was a very good thing for the country. And after that, it was time to come home, and he retired and came home as chairman of First Security, Utah Construction, and Amalgamated Sugar. JS: Once again, though, seeing the responsibility, the need to do a particular thing. SE: Absolutely. There probably are other words that I could think of, but it was always so clear to him. There was no question what he had to do. 17 JS: You mention that his loss in the Senate race deprived the country of an internationalist senator, but it did allow him to focus in on those three companies in particular. SE: Exactly, the point that I wanted to allude to. JS: Do you think that he realized that, as the kind of independent thinker he was, he was not going to be the kind of person that would be successful in politics? Did he harbor any other political aspirations after that senate race? SE: Not that I know of, but I would think that it was a big step for him to consider the political move at that time in his life, and that he was encouraged to do so. At any rate, he didn‟t do it, and we‟re the beneficiary. We don‟t know the benefits if he‟d gone the other direction. I think that it was better to turn out the way it did, but that‟s anybody‟s guess. JS: Sure. You mentioned that his frank discussions with Johnson cost him invitations to the White House. What sort of relationships did he have with the presidents after he left the Fed—Eisenhower, Kennedy, Johnson, and Nixon? He seems to be a pretty strong critic of Nixon. SE: He did not vote for Nixon. He thought he was a crook, and said so. He introduced Bobby Kennedy out here at the Hotel Utah, much against everybody‟s advice because of Bobby Kennedy‟s position on whatever it was that he felt was important at the time. But I do know what he thought of Nixon, and I know what he ultimately thought of Johnson. With Nixon, he just said, “Absolutely that‟s the wrong person to put in the White House. We shouldn‟t do it.” And he didn‟t vote for him. 18 Well, he came back, and he and Sallie were married. He bought the apartment house in San Francisco. He spent two weeks a month there and two weeks a month here at his apartment in the Hotel Utah. I believe it was one floor above President David O. McKay of the LDS Church. And that was his life: back and forth. He corresponded, I believe—I can‟t think of the instances—with presidents, and particularly with Senator [J. W.] Fulbright. But he became less popular later on—in social groups and in other speaking engagements—because he was so intense, so well armed, so intractable, and so persuasive in his arguments about Vietnam. He was not your most in-demand dinner partner, and Sallie tried hard to get him to soften. He‟d sit here in the cafeteria with the rank and file, or whoever was sitting in the cafeteria having lunch, and he would speak on international monetary situations, domestic questions; and then he‟d speak on Vietnam and China and population explosion. Everywhere he went he would speak, and so there were strong feelings about him as an independent thinker. But now, you know, he wasn‟t a radical anymore. And he wasn‟t somebody that was unproven, and he wasn‟t somebody on the lunatic fringe. He was someone that had to be reckoned with because he‟d been there, he‟d done it, and the logic, the compelling nature of his position, was damned hard to challenge. But now, I came out of college in „56, and after the Army and ski racing internationally, I got married and went to Columbia for my undergraduate degree. Then I went to Columbia Business School to get my master‟s degree in banking and finance. I wrote my master‟s thesis in two parts: one was Marriner Eccles, the man of the Federal Reserve; and the other one was the history of the Bank 19 Holding Company Act of 1956, which was so imperative to and impactful on the First Security Corporation, because we were the oldest multi-state bank holding company. That legislation was to close down multi-state companies, so bank holding companies were grandfathered—fourteen of us, at that time. Then they found a loophole and Citibank drove through that with a Mack truck and everybody went in after. They closed that loophole in the 1970 amendments. Before that though, I met with Marriner numerous times on my thesis; one night, we sat in Trader Vic‟s in New York until I thought the waiters were going to throw an ashtray at him. But, you know, I was able to get all the information, and he was a hard man to stop once he got started. So we didn‟t get finished until about 1:30. Sallie was mad and, of course, I was the cause so I took the brunt of it. Then I came out West and interviewed him a couple of times. Then I went to Citibank for a year, and then I came home to First Security, and that‟s where I really started to work with him and to know him in many different positions, postures, and attitudes. After, I was sent to Idaho for ten years, to the First Security Bank of Idaho. Consequently, I wasn‟t as close as I was when I came back in „70, and for the next seven years. This is not my office that we‟re in; this is Marriner Eccles‟ office. I‟ve brought in the history of the family here, particularly of First Security. I call it the Heritage Room, and the pictures above the fireplace here: that‟s David Eccles, George Eccles, and Marriner Eccles; and then the picture of the four brothers over here with Dad and Willard Eccles in it; and then the three brothers over here 20 with Dad gone and me in it as by far the youngest man and then some. [Laughter] I had a wonderful relationship with Marriner. He was a mentor to me; he taught me many, many things. Certainly, he taught me about integrity and the moral conscience that he followed. I saw the independence of his thought, but I saw how courageous he was; fearless in defending his positions, no matter how unpopular—and, boy, they were unpopular. I mean, the American Bankers Association took aim at him, and tried to, in essence, smear the family and First Security because of him. They passed resolutions against what he was trying to do in the Fed, and those were hard times to have to take those positions, so why do it? Why don‟t you back off? Why don‟t you seek compromise? Obviously, he compromised, you have to in life, but he never backed off; and his compromise was grudging, and only to accomplish the greater good, which he would hope he could alter at a future battle. Well-reasoned is the way I looked at him. I‟ve had my tail feathers chewed right here in this office, right in front of the model that‟s not there now of the Abraham Lincoln desk that he had at the Fed. I gave a speech and I came back in and his secretary said, “Marriner wants to see you.” I mean, I hadn‟t got in the door, that‟s how fast he was able to pick up on it, and knew that I was dead wrong. I thought he was wrong; we had a very real discussion about it. I still think he was wrong! [Laughter] I was looking at it from the point of view of First Security and our own best interests; he was looking at it through First Security, but he was looking out over the whole spectrum of the shooting range. 21 JS: More broadly. SE: And he wanted all banks to come under Federal Reserve control, and I liked it the way it was where national banks were under Federal Reserve control, but the dual banking system said that state banks that were not members of the Fed would come under the state banking commissioner and the FDIC as a regulator. So you always had the choice to be under the Fed as a national bank, or to change and be a state bank. Now, a lot of banks are changing to be national banks, but I liked having two regulators, because with one regulator, when they‟re wrong, then everybody‟s in trouble. That was more my perspective, and why I spoke to that subject that way. He looked over that at the bigger picture— what‟s best for the country in this regard. Therefore, the central bank needs to have control over all banks if they‟re going to run monetary policy through the banks effectively. JS: And could you have that disagreement with him, and then ended it by saying, “Well, you have your viewpoint, and I have mine; case closed”? SE: I don‟t think we ever got it “case closed.” It was just that he‟d made it abundantly clear that his was the more responsive attitude—approach—and would give the best result, and I ought to agree with that. If I didn‟t agree with it then so be it, he wasn‟t going to can me. JS: Sure. SE: So I had a high degree of respect for him, as I learned that others did. I saw it in the deference that they would accord him. As he got older and age took its toll on him, he was more alone up here. I would walk him up to the Hotel Utah because 22 I‟d be working late; this was the twilight of his career, but he was still the same old Marriner—boy, you better have your act together when you got a position because he was going to eat it alive. He‟s been thinking on it and thinking on it; he‟s whittled it down, mixed it up, and brought it out, and pretty soon here‟s his position and that was that. If he found that there was a weak spot or that there was new information, he would adjust. But he was just a phenomenal American that hasn‟t really been accorded all the recognition that he should be. One more thing that‟s going to take place: as you know, each state has two statues in the U.S. Congress. One from Utah was clearly Brigham Young. The other one was to be selected, and, as the story goes, there were other individuals being considered; one was Marriner, and one was Philo Farnsworth. An elementary school got behind Farnsworth and caught the fancy of the folks that would make the decision. Ultimately, they chose the inventor of television— fantastic guy, I mean, talk about changing the world! So that‟s the second statue back there, and not Marriner Eccles. But Marriner is a giant in the history of the state of Utah, in an area that not so many people can understand. They can‟t sit and look at monetary policy, but they can sit and look at the TV. So now the State Legislature—the Senate and the House—have passed a resolution to strike a statue of Marriner. It was to be in the rotunda of the new, refurbished state capitol—a $200 million renovation—but now it‟s going to be out in the garden. When you see the garden and the fountain it‟s fantastic with four statues: one will be Brigham Young, and one will be Colonel Kane that was in the rotunda—and in the four alcoves in the rotunda, those will be the different types 23 of statues. At any rate, the second one is going to be placed in the Marriner Eccles Federal Reserve Board building. It became the law of Congress under the Garn-St. Germain Act to name the building after Marriner. So we‟re meeting on that to put out an RFP—Request For Proposal—to select the sculptor and then to strike the statues. It‟ll be life-size-and-a-half up here, I believe, or a bust in the Federal Reserve. We hope to have that ready for the dedication of the renovated state capitol in early „08. That will be my conclusion for Marriner Eccles. I‟m the keeper of everything now going forward for the family, and that‟s what I work on through the foundations—to make sure that what they believed in, what they wanted for the state of Utah, for the people of the state, and for future generations happens. I help accommodate that through the foundations and make it happen. Then I pass the baton on at some appropriate time. JS: We really appreciate the time you‟ve taken to sit down with us. I think we have a much better understanding of Marriner Eccles. Even though you must have caught hell for being at Trader Vic‟s „till 1:30, that must have been as valuable a graduate school seminar as any other one you took. SE: You can just imagine! I mean, here you‟re talking to the guy. It‟s like cornering [Alan] Greenspan—except Marriner spoke in very understandable terms and Greenspan learned that he had to say something so that he‟d said it all for the record but you didn‟t understand what he said. [Chairman Ben] Bernanke is having a problem because twice he‟s said something that was exactly right and very straight-forward—anybody could figure it out and not be surprised—but both 24 times the market has tanked—big-time tanking. And this last time, it‟s still tanking. JS: As I mentioned to you at the beginning, our symposium this year is going to focus on the relationship between Marriner and Ed. We have two of our history faculty working on papers and presentations; we‟ll have an exhibit and a book focusing on the two. There‟s a wonderful picture of the two that we‟re using in the book that, I think, gets at the difference in their generation and their style. I wished I‟d really gotten to know Littlefield. SE: Well, he was energetic, obviously. He turned out to be very adroit at his trade— being an executive and a leader. He and Marriner worked on the strategy, Marriner working on the bigger picture and Ed working to execute what they decided on. Marriner was the mentor and Ed the disciple; Ed came to be his own man and was appreciated by Marriner. Marriner thought the world of him and had the greatest of confidence in him. I believe, and it‟s been documented, that Ed felt the same about Marriner. As far as Marriner‟s skills, he had his ability to analyze and to see the big picture, to articulate, and to delegate. He didn‟t get in and run things; he never got in and ran the banks ever, but I saw what he did in First Security on the different approaches that we took. Ed was very, very impressed, confident in his relationship with Marriner, and they made a terrific team. I think that the program that you have up there has lost some of the perspective that‟s already in the history books about, first of all, David Eccles‟ impact that breathed life into what was headed for insolvency—the original Utah 25 Construction in 1900. He was already the successful businessman and the banker, and I don‟t see that the record up there, as I view it, has been as balanced as I believe that Marriner‟s books—he knew David, worked with him, understood him—would indicate. So David‟s role, I don‟t believe, has been articulated and balanced as it should be in the Sessions book. I‟m not really clear that Marriner‟s has also. I‟m not totally satisfied, and I‟m somewhat distressed about it, and I‟ve not taken the time—on the record here, I am taking the time to get into it—but I do have strong feelings about it, and I‟m about the only one left that could articulate it. But I can point it out in the books by Sidney Hyman: first of all, Challenge and Response; and second, Marriner Eccles: Public Servant and Private Entrepreneur. There‟s no question that the relationships in the Wattis family have an impact. It is not to say that the Wattis family did not have a tremendous impact, but they didn‟t bring the financial resources to make it possible to breathe life into a company that was in deep trouble. Of course, Ed is very, very complimentary about Marriner, and obviously shows a great affection for him, a great confidence in him, in the integrity and the independence of him, but also of the competence of Marriner. I pulled together all the different things from Fortune, from Marriner‟s two books, and from the things that I‟ve followed about Marriner and about the company. The success story is attributable, first, to David making it possible; second, to the Wattis family being able to run it the way they did. But it‟s very interesting that William Wattis and Marriner had a very hard conflict…difference of opinion. Marriner wasn‟t going to 26 run the company—he wasn‟t going to just go out and do it. He wasn‟t an experienced heavy-construction guy, so it was William that made damn sure that Marriner was the one that was selected as president, and then stayed president all through the Fed, and come back as president. And of course, then both William and Ed Wattis had passed away and Marriner was wise enough to find a person of the Wattis money that had capabilities to come in. That was part of the brilliance of Marriner. JS: Yes, wise enough and big enough to do it. SE: Yes. He taught us all something; he gave us the yardstick and the Holy Grail to save it. He was my mentor and he was a strong advocate, as things would turn out, that I would succeed George and lead First Security for eighteen years. He was the one that was looking way out and making the decision to guide things that way, and he was doing it with a backdrop of national and international politics. I wish he were here now to see the condition of this country, and where we need to go. I met yesterday with Mitt Romney and I very much believe that there is where we need to go, because the integrity is there, the know-how is there, and everything that fits in between there. We‟ll see where that goes. LL: With everyone we‟ve talked with, we‟ve talked about the father-son type of relationship between Marriner and Ed Littlefield. Everything you said was just right on the mark to what people from the Littlefield family said. It‟s been a real honor for me to be able to learn about this man. It‟s exciting for me to be involved with this project. 27 SE: Well, it‟s exciting to know what was accomplished, and the resources that were managed, and the wealth that was created. And now we can see the giving back of the wealth—the sharing of the wealth for the betterment. It‟s a great, wonderful story, and it‟s a sobering responsibility because there‟s so much need out there. But there won‟t be a Marriner Eccles to come along all the time. He was not a political figure. He obviously had to be cognizant of the politics of any relationship, and he fought, I mean, he was brutalized, but you look up there and see that Time magazine cover—it says, “In God we trust,” and it‟s crossed out to “In Eccles we trust.” Then the quote that Marriner Eccles is the only one that stands between the United States and disaster—something to that effect. I have been the keeper for a long time here of this Heritage Room for all these folks that are now gone, and it‟s a great privilege; it‟s a humbling experience to have been thrust, in my own right, forward into responsibility. It was not necessarily a long-term plan of mine. It‟s serendipity. The stork dropped me down that chimney—I could have gone down a lot of chimneys. I could have missed and ended up in the drain pipe! [Laughter] JS: I don‟t think so. Going back to something you said a minute ago. We understand what you‟re saying about David Eccles, and we‟re moving that way, I think, with our symposium. I think this year‟s symposium is a step in that direction. We‟re calling our booklet Uncommon Vision: The Combined Leadership of Marriner S. Eccles and Edmund W. Littlefield, and we think we‟re right on both: that it was uncommon and it was a partnership. We‟ve learned a little bit in the last five years about what we have and what we need to do. 28 SE: Well, it probably would have taken place sooner, but each year you schedule it when I‟m out of town, as you have this year. Having missed four years, I‟ve never been able to voice my concern with two different [Weber State] presidents. And, you know, at the start of the whole shooting match, David had the bank; the bank had the maximum amount of money loaned to the company. The company had a number of families living out of it, and the two Wattis brothers were the driving superintendents, but they didn‟t have major resources at that time in their life. That‟s why, in Marriner‟s book, it‟s clear that he [David Eccles] put the money in personally. He gave them a third to a sixth each of the stock and he took their note back. They paid it back from dividends. So when we talk about the founding of the whole shooting match, basically it would have floundered. In the reorganization, because David couldn‟t loan any more money from the bank, he put it in. It wasn‟t a great deal of money; apparently it was only $25,000 at that time. But it seems that everything that comes out now says that the Wattises founded the company and I think that‟s not an accurate portrayal; it flies in the face of both of Marriner‟s books. Obviously, David was a very wealthy man and a very great leader in 1900. He died twelve years later. One of these articles says he didn‟t have much impact on the company at that time. Of course, according to Marriner, he called the Wattis brothers and said, “What‟s wrong with this job? What‟s wrong with this company?” And they said, “Too many families living out of the company.” And he said, “Well, then I want you—you‟re the guys, and you come and here‟s what I will do.” And of course, Judge Dee—he did everything 29 with Judge Dee—and Pingree came along, too. So that‟s the other third; then he took a third. Someplace I read that the first couple of years they paid back the full amount out in dividends—the full amount of the investment—which would mean those loans were paid off in a relatively short period of time. But at any rate, that‟s how it got started. It was David‟s reading of the Wattis brothers, and their experience and their ability to take risks and deliver. And he always shared everything; seldom did he ever control or own outright any of the entities that he was involved with. JS: David? SE: Yes. So that‟s exactly how this started, and that hasn‟t come across to me in everything that I‟ve seen, and maybe I haven‟t seen it. JS: No, I think that‟s a fair criticism. SE: But it‟s in the book; it was put in there by Marriner Eccles himself. It isn‟t coming out in the seminar and in the whole shooting match up there. This is the first time that I‟ve expressed the thought, and now it‟s been expressed for all time and eternity! But enough of my dissatisfaction and concern. JS: No, it‟s constructive criticism. SE: Well, most of your dealings have been with the Wattis side of the equation, it seems to me, because you haven‟t had anybody to deal with on the Eccles side. I am basically the only person that you could talk to in order to get in the breadth and the depth.