The goal of the builders; a story of Trustees system service

Front matter

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Contents

Chapter page

I. The Man and the Idea 5

II. The Vision of Service 12

CHAPTER I The Man and the Idea

ONE day, early in the year 1914, a young man in Birmingham, Alabama, had one of those wonderful thoughts that come, now and then, to intellects of genius, and which seem to be born into the world at opportune times to ease the strain of difficult living for the great mass of over-burdened men and women.

This young man was John Charles Corcoran, one day to be known as the founder and guiding head of that remarkable company of workers whose business association prospers under the name TRUSTEES SYSTEM SERVICE.

He was born at Wisconsin Rapids, Wisconsin, November 22, 1883. It was a little village on the Wisconsin River, and the life of this boy was that of a farmer lad, with all a farm's limitations in that early period of his country's history. His father, a small carpenter, had never gone to school a day in his life; but it was his ambition to give to each of his seven children a high school education.

Little John Corcoran early learned all about the value of money. He never did have any quantity of it that he felt free to spend on the interests of childhood. From the time he was eleven he

G THE GOAL OF THE BUILDERS

earned his own way, bought his own school books, and in time of vacation stowed away in a little savings account enough to pay for clothing and the other necessities that sent him through school.

His first job was soliciting the enlargement of photographs across the countryside, but he made a success of it. Many other jobs followed, for he was interested in everything he saw, and he pursued each new interest with a tireless energy. Those early days are dotted, therefore, with experiences as clerk, salesman, newspaper reporter, factory and mill employe, farm hand and timberworker; and the year 1914 found him engaged in the real estate business in Birmingham, Alabama.

If they were difficult years, they were soon to have a particular value to him; and it is worthy of note that the level of his daily efforts was that from which the world's thinkers have always come. P.erhaps an unusual influence was guiding him. He was learning life, how men worked and lived. At first hand, he was made familiar with that ever-present struggle of the Average Man to rise above and conquer his environment.

In Birmingham he found a set of conditions that deeply stirred his interest. The city was then, as now, an industrial center, typical of scores of other busy communities in our country. It swarmed with armies of working men and women whose earnings were in the form of weekly wages or salaries.

THE MAN AND THE IDEA 7

It also swarmed with regiments of loan sharks and pawnbrokers; and there was a sinister relation between the parallel existence of these money leeches with the armies of earnest and thrifty workers. They offered the only financial assistance available to the worker in any time of his sudden need or greater opportunity. No one else, in fact, had ever thought of offering him a real money service of any kind.

Why was this?

Aside from the ethical question of usury, it seemed to Mr. Corcoran that there was no sound business reason why a liberal, just and profitable loans service should not be provided for the wage and salary earner, as well as the man in business life.

Yet banks, even as conducted upon the broad and liberal plans known in America today, plainly made no effort to touch this field. They were organized for service in a comparatively restricted way, and so hedged about by rule and law that they could not reach beyond their customary business and financial circles, even if they would.

Only the savings bank opened a welcoming door to the footstep of ''The Man who Works." Yet even here his only resource in the day of emergency was the paltry sum of the savings he might have been able to pile up through arduous months or years. No matter how honest and worthy his character, no matter how thrifty and ordinarily independent, the Average Man, witiiout property wliicli might be mortgaged, found no one willing to lend money to him but the loan shark and pawnbroker.

Mr. Corcoran looked about him and made a study of the loan shark and his client. Birmingham doubtless in that day was no worse than many another large industrial city in the vicious character of its loan shark problem, and certainly no worse than scores of cities at the present time, where no adequate effort has been made to curb the evil and institute a really helpful and rival service.

He found the office of the usurer wide open upon every corner, thriving in every office building. Literally by the hundred, they squatted at every point of vantage, preying like leeches upon the worker's misfortunes and necessities, sucking up the lifeblood of his earnings, and leaving him little chance to escape from their clutches, once he was within their power.

The sight of the nefarious traffic sickened the young investigator. He went about the streets, watching the continual streams of those who entered the den of the usurer, noting the heavy lines of worry, illness and sometimes desperation in their faces, with a heavy heart. He was stirred as he had never been stirred before, and with all his friendly nature he yearned to do something to help these people.

THE MAN AND THE IDEA 9

Gradually it was borne in upon his mind that there were two distinct classes among those who sought the loan shark's door; but the one class was enormously greater in number than the other.

The first was made up of the chronic borrower, the down-and-outer, the potential deadbeat and the man who was always in hard luck. Their borrowings were of paltry sums, merely a few dollars to tide them over until payday — their excuse usually some insignificant emergency which received but scant consideration at the loan shark's hands.

But the second and far the more numerous class, so numerous, Mr. Corcoran found, in fact, as almost to hide the drifting human derelicts from view, was made up of men and women exactly like himself.

They came from those great armies of steady and habitually industrious workers employed in the stores and offices, foundries and workshops, of the great city. They had homes of their own in many cases, children, and usually good employment at their profession or trade. They were earnest, thrifty citizens, bent steadfastly upon the worthy ambition to get ahead in life, ordinarily amply able to carry their financial obligations.

But misfortune had fallen upon tliem. Unforeseen emergencies had developed in their lives and daily fortunes. Thrown suddenly into debt through illness, death in the family, temporary unemplojanent, or other mishap, in their unfamiliar and sometimes desperate trouble they had no recourse save the charity of friends or the hard conditions of the loan shark.

Perhaps there had once been a small bank account, which was long since entirely used up. Perhaps there were payments being made on a home, and these had already become overdue. Perhaps there lay in the books of the doctor, the hospital and the merchants who had supplied them with the necessaries of life, bills which had accumulated through long months of ill-fortune, and which the borrower now sought to clear off because he was an honest man.

Because he was an honest man!

In that moment, as in the twinkling of an eye, J. C. Corcoran got the essence of the great idea upon which he was eventually to build the wonderful Trustees System Service for honest men and women.

For it was plain that the Honest Man must be the foundation of the loan shark's profitable business, as well as that of every other. If the loan shark had to depend upon the chronic borrower, the down-and-outer and the deadbeat for any appreciable portion of his gains, he could not remain in business long.

In fact, it has always been the vociferous claim

THE MAN AND THE IDEA 11

of the money shark that it is because of losses sustained through loans made to "deadbeats" that he cannot do business except at usurious rates. He confidently depends upon recouping these small and occasional losses out of the fat profits taken from the payments faithfully made to him by the Man of Honor.

But J. C. Corcoran, in that swift, illuminating moment, saw the tremendous possibilities of a service that should reach out to serve only honest men. It should be so organized that it would make its appeal directly to the thrifty, industrious, conscientious citizen whom we know in America as "The Man who Works."

Mr. Corcoran believed absolutely in the sincerity and dependability of this man. He was confident, not only that a liberal, just and nonusurious loans service could be provided for him, but that when this was done the worker himself would respond in the full spirit in which such service was offered, meet fairness and sympathy with an equal understanding and honor, and that a mutually friendly, helpful and profitable business would be the certain and triumphant result.

CHAPTER II The Vision op Service

IT is evident to any thinking man that the usual banking house is a class institution. Its offer

of service is only to those who already have acquired a goodly portion of the wealth of the world. Some form of mortgageable property, either real property, stocks or bonds, deposits in banks, or the assets of a going business, must be presented to it before credit will be extended to any borrower.

Nor is the savings bank essentially outside the same narrow class circle. While it readily receives the savings of the smallest wage earner, none of the total of its savings fund is available to anyone who cannot present mortgageable collateral in a ratio of at least two for one.

There is no intent here, however, to pick a quarrel either with banks or their methods of operation. On the contrary, it is plain that class banks are necessary. The institution that might be planned to serve perfectly both the wealthy financial interests of an average American community and also the far greater mass of smaller men and women, would have to be a colossal affair, beyond the scope of anj'lhing hitherto planned or imagined.

THE VISION OF SERVICE 13

But for every person to whom the ordinary banking house extends its loans service, there are probably ten others who could use such a service to their advantage, if only it were available to them.

Even a casual glance at figures covering the distribution of wealth in the United States will enable anyone to realize this fact. Of the total wealth in our country in 1921, estimated to be 300 billions of dollars, ninety-five per cent of it, or more than 285 billions, was owned by but five per cent of the people.

Conversely, therefore, the great ninety-five per cent of the people owned only 15 billions of the total wealth. Reduced to individual figures among the 105 millions of people who in that year went to make up the ninety-five per cent of our country's citizens, we see that the average wealth of the individual was then less than $150.

But wealth, even among this great ninety-five per cent, is not distributed evenly. There are many human derelicts to whom a dollar is only something to be spent as soon as possible. These always have been drifters, and they always will be. Money gravitates into the hands of those who realize its value and who have a thrifty concern for the sound upbuilding of their fortunes.

Fortunately the great mass of our country's citizens are of this latter class. They are neither the beastly rich nor the abjectly poor. They are intelligent, self-respecting, earnest men and women, industrious, steady workers, upon whom the present greatness of our nation has been built and its future may safely depend.

Although they have no great quantity of wealth, each one of them is in the way of becoming a man of means. They are little financiers, with the steadfast ambition to grow bigger than they are. Many of them are young, with all the hopes and confidence of youth, eager to establish homes and firesides of their own. They have their wages, their brains, sometimes even a little sum laid by in the savings bank. Daily in increasing thousands they throng to and from their work, their minds bent upon honest service, their hearts and energies reaching out in all directions for growth and greater opportunity.

Yet not one — or, at least, scarcely one — in a thousand of these worthy people, either in time of adversity or of opportunity, alike, can find credit accommodation at any bank.

It was the dream of J. C. Corcoran to bring to everyone of these splendid men and women a broad and really helpful money service which should adequately and peculiarly fit their needs. His vision comprehended a remarkable class bank, at which * ' The Man who Works ' ' should find both a loans and a thrift service paralleling in every way that enjoyed by the business man in his own commercial bank.

THE VISION OF SERVICE 15

His great Plan, in fact, embraced an entirely new and revolutionary arrangement of financial service. He saw the end of that day when any community must center its progressive life solely about any single bank or group of banks, whose favor might be extended to a limited few, while the vast majority of the people went entirely unconsidered and unserved. Instead, he had the courage to plan for a community where there might be two vast financial influences, the one properly serving men of wealth and the interests of Big Business, but the other reaching out with sympathy and understanding into the multitudes of smaller homes of men and women who work and serving and helping the people.

Being frankly devoted to the service of workers — of average men and women — this "Industrial Bank" should in every way consult their own special interests. Its organization, plan of finance, methods of operation, its very character of thought and conduct, should be solely from the point of view of the worker. And its actual service should be the most liberal, easy and personally helpful to the borrower that sound business principles, the safety and integrity of the institution, and a decent profit upon the money invested would allow.

Realizing that any unselfish and idealistic program, such as he proposed, would of necessity find small favor with that type of financial mind whicli seeks the greatest possible profit under the law, Mr. Corcoran turned confidently to the workers themselves for encouragement. His eager mind conceived a great co-operative association of these workers, who should finance with their small savings their own credit system for loans service.

The details of this unusual financial plan will be dealt with in their proper place, with all the remarkable interest and value they deserve; but it should be recorded here with emphasis that Mr. Corcoran found among the people a sympathy and a readiness to support his undertaking, which far exceeded the modest hopes he originally entertained of such co-operation.

The actual plan of his Industrial Bank was modeled, for stability and strength, as nearly as possible along the lines of the usual national and commercial bank, but its methods were far more liberal in almost every way. The ideal held constantly before his mind was a loans service without the shadow of usury, and which should effectively rea«h and serve as many of the people as possible.

Therefore no mortgage, assignment of wages or property collateral of any kind was to be asked of any borrower. Loans in moderate amount were to be offered to any man or woman who was steadily employed and whose reputation for integrity— whose simple honesty — was unquestioned in the community where he might reside.

THE VISION OF SERVICE 17

Thus character and earning capacity were to be the two single requirements. Honesty was the real security. Mr. Corcoran 's abiding faith in the fundamental sincerity of average men and women was to be put to the test as the basis for a great loans service.

He planned to determine this question of character through a careful system of credit reports ; and when it should be established that the individual was to be trusted, and that his employment was such as to enable him eventually to repay the debt, the loan should then be made as readily as a sale might be over a merchant's counter; provided only, of course, that the money required was to be used for a worthy purpose.

Moreover, time-payment privileges were to be extended so easy as to fit the convenience and income of any borrower. Loans were to be scheduled over an entire year, or more, as the borrower might elect; and as these partial payments were promptly met on the due dates, savings interest was to be allowed at the current bank rate upon them.

But the scope of this unusual service was to go even further than this. The single end and aim of this Industrial Bank was to be a genuinely helpful, unselfish service, in no case a handicap or a burden. Care should therefore be taken to see that no borrower, through a mistaken sense of ability or pride, should in any case contract to make larger installment payments than might readily be handled out of the margin left from his usual wages or salary. To this end, before any loan was attempted, a careful schedule of the borrower's income and maximum expenses was to be made out through consultation with the borrower.

Thus men and women were to be helped, unobtrusively and sincerely, through giving them liberal and dignified opportunities to help themselves. The loans service proposed was to be in spirit and in fact a real Thrift service. The vicious and notorious business of the money shark should be fought with the golden weapons of truth, fair dealing and honesty.

Chapter III

FOR the practical carrying out of this great plan of service, Mr. Corcoran took a single small office on a modest floor of the First National Bank Building, in Birmingham.

It has been aptly said that this office contained little more equipment than ''a desk, a chair, and a big idea. ' ' But the man at the desk had youth and enthusiasm, and he also had a splendid confidence in the worth and ultimate success of the business of service which he proposed to establish.

It is a well known and singular fact that the world has almost always looked askance at the ideas of genius. New things are a good deal of a shock to people who are comfortably settled in their ways. The more special knowledge a man may have on any subject, the more reluctant he always is to acknowledge that any better way of doing a thing ever can be found.

Nor did Mr. Corcoran, when he presented his scheme for a great Industrial Bank, discover any failure in the application of this general rule. It was a plan that startled capital. Instead of realizing promptly that a stable and widely influential Bank of the People must prove to be an additional power in the upbuilding and progress of all the community, there were some financial interests which chose for a time to see in the new plan only an obstacle to their own larger development and profit.

Fortunately all this wholly mistaken opposition has long since disappeared. Men of every kind have come to understand that the Industrial Bank has filled a long felt want in the life of every community where it has been established, and that it supplies a vital and diversified service to average men and women which the usual banking house never could attempt.

Bankers today are frequently among the first to send to the Industrial Bank clients for loans service whom they have been unable to supply; and through a mutual respect and appreciation of dignified service a substantial bond of real co-operation has been drawn between them.

Birmingham, in 1914, however, held many men of wealth who professed to find far more serious flaws in the new banking plan than any mere rivalry for business. They said, in the first place, that money to finance the enterprise never could be found; and in the second place, if sufficient capital ever should be discovered to start such a visionary and plainly impractical scheme of loans service, the business structure must soon fall to the ground of its own weight, because men and women without mortgageable property were not to be trusted with money!

Only a ''Dreamer of dreams," they said, ever would propose to build a great business structure upon any such unstable foundation as a simple belief in men's honesty.

But the proof of the pudding, to quote a very old and homely proverb, always has been in the eating of it. When men smiled at the ideas of J. C. Corcoran in that spring of 1914, they did not comprehend that they were attempting to discount one of the most astute and clever minds of their generation.

He readily understood that attitude of veneration towards profits which usually controls the investments of capital, and he had no intention of hampering the high quality of his service with the sinister influence of any large and powerful stockholders.

His scheme of organization, therefore, passed completely by men of wealth, for he rightly deemed them unnecessary to his purpose. Instead he went directly to the wage and salary earner, men of moderate means but of intelligence and solid character, whom he invited to become partners with him through the investment of a small part of their earnings to form the great fund for Trustees System Service.

These men would be able to understand the high faith which he himself had in average men and women. They were, in fact, precisely the same kind of men and women whom his service was meant to serve. They would be more liberal in their ideas and expectations of the legitimate earnings of money, and he might expect them, not only to be genuinely interested in the sei*\'ice, but to be inspired with a desire to make truly eifective and helpful the business in which their investments should be engaged.

With such broad conceptions as these, then, he laid his original business plans. He first interested a few close friends, whose faith in himself, perhaps, w^as the principle influence which drew their support, but who nevertheless could deeply appreciate the unusual character of the service he wished to render. With these friends as a courageous nucleus he formed his first little company, and then set out to carry his plans to the people themselves.

Nor was he disappointed with the reception he received at their hands. It seemed only necessary to tell men the nature and purposes of this wonderful service to make them immediately supporters and friends.

The borrower instantly saw what great opportunity it offered him for financial betterment. The merchant and professional man perceived that such an unusual service would provide countless easy ways for the honest debtor to clear off obligations which chafed his pride and sense of independence. And the financier and man of public spirit recognized in Trustees System Service another vital force, like themselves, working along broad and constructive lines for the solid betterment of all the people in the community.

The financial phases of the plan also appealed to men as a sound and profitable undertaking. They realized that the organization, under skillful management, should have no difficulty in making profits in ways precisely similar to those of national and commercial banks.

Moreover, it was plain that a company of such shareholding partners, each of whom, from a personal point of view, was so closely and vitally interested in the business, must be bound together in a manner the most truly and effectively co-operative, and that results therefore should be correspondingly great.

Thus success attended the enterprise, even beyond the confident hopes of Mr. Corcoran and his early associates. It will be remembered that the year 1914 was the first of the great World War, and that many a fair business which might seem to have had every chance for stability and certain growth, nevertheless crumpled up and disappeared before the tempest that swept that dark financial sky. Truly it was a time that tried the souls of business and of men, and nothing could better gauge the caliber of a young and experimental company than this test of supreme endurance.

But Trustees System Service not only survived, it grew through the storm with an astonisliing assurance and vigor. Friends multiplied, shareholders among the earnest, thrifty workers of the community leaped in number from hundreds to thousands. Business and professional men voluntarily came strongly to its support, and every financial interest soon realized a worthy partnership with it in stabilizing the best interests of all the industrial life.

Within the year the original little business office was far outgrown, and the System moved into the first of its spacious ground floor locations on First Avenue. This, however, was only the initial advance, and Birmingham only the beginning of the sturdy organization that was to make its consistent and triumphant march down the years. Inspired with a consciousness of upleaping power and influence, it soon became evident to the management that it was only the part of wisdom to prepare for such wide growth and expansion as the first modest hopes of its founders had never dreamed possible.

Plans were therefore drawn for an organization of really national importance and scope. Louisville, Kentucky, in time was selected as the seat of the first new Industrial Banking branch, and in the establishment of this office an experience very similar to that in Binningham was enjoyed. Both the worker and the business man rallied to its support, and its success was an accomplished fact almost from the first day of its existence.

Thence the organization spread rapidly to Indianapolis, and beyond that, in time, to Chicago. But it would be only a story of infinite repetition to record how each new office was established and advanced in power of service and financial strength. In every case success Avas built on that honest faith in the integrity of the worker which inspired the founder of the great service in the first days of his vision in Birmingham ; and in no instance was it ever necessary to limit the liberal terms and methods he had established.

Opportunity was sought, on the contrary, in all possible ways to make the service only the more easy and attractive to average men and women. The move into the vast field of Chicago offered the System probably the most splendid opportunity of its career.

This is the nation's greatest industrial city. Its wide districts teem with the prolific energy of factory and office, warehouse, foundry and mill. From end to end on the south and north, and from the lake far out into the western horizon, stand the homes of the workers in these industries, crowding one upon another, endlessly, thousands upon thousands of little households.

They are the homes of "Men and Women who Work," whose earnings are measured in the form of weekly wages or salaries. Everyone of them is a potential friend and user of Trustees System Service !

Two flourishing offices had already been established here, but with the opening of the remarkable year 1920 a new vision dawned for the great service organization. Encouraged by multiplying successes and by the rapid stabilization of general business conditions after the war, a far-reaching plan of expansion was begun. The essence of this new plan is to place a Neighborhood Industrial Bank in every industrial center, in every busy community of workers, across the whole of this great city.

Five new" branch Industrial Banks were therefore planned immediately and carried into complete organization during the latter part of the year 1920. They are located as points upon a great circle, scattered north, northwest, west, southwest and far south, so that they are fairly representative of what the Chicago organization is planned to be, and with the two original branches in the loop and the southwest form the framew^ork for that vast network of service stations which the future years mil undoubtedly see.

Chicago is a city of 2,700,000 people. It is estimated that there are more than 540,000 individual homes. The achievement of this splendid plan calls for a friendly blanket of service, which shall be thrown over the whole of this vast community and bring close to the fireside of every ''Man who Works" an assurance of sympathy, understanding and real financial assistance in any time either of his emergency need or greater opportunity.

1916 - $61,789.60

1917 -$141,190.33

1918 - $172,782.12

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LOANS RECORD OF TRUSTEES SYSTEM SERVICE

And beyond these lie the thousand other communities of our country and nation, made up of the same kind of thrifty, forward looking workers and friends, who only await the opening of similar service stations in their own neighborhoods to avail themselves of the wonderful opportunities these will surely bring.

For wherever there live men and women, wherever there are households engaged in that old, old struggle to w^est a little daily advantage from the difficulties of work and life, wherever there are children, wives and husbands subject to illness and the many misfortunes against which no strength and no loving foresight can shield them or render them immune, there, if opportunity shall ever be given them to know about it, you will find devoted friends and thrifty users of Trustees Svstem Service.