Pujo Committee

What Was the Pujo Committee?

The Pujo Committee was a congressional subcommittee that issued a persuasive report in 1913 presuming that a small group of magnates situated in New York City had accomplished virtual monopoly control over the American financial system.

This group of business titans, which incorporated a portion of the incredible business figures of the time, became known as the money trust.

Figuring out the Pujo Committee

Concerns about the concentration of financial power in the U.S. started to fill in the late nineteenth century with the rise of the "robber barons," men who accumulated huge wealth and power by building predominant jobs in banking, the railways, oil, and different industries that were key to the country's growth.

Their names included J.P. Morgan, the banker, and William and John D. Rockefeller, founders of Standard Oil, among others.

The concerns heightened with the Panic of 1907, which was set apart by a series of bank runs that ended just when Morgan personally interceded to support wavering financial institutions.

Report on the Money Trust

A resolution to investigate the supposed money trust was presented in the House of Representatives in 1911 by Rep. Charles Lindbergh Sr., father of the pilot Charles Lindbergh. In 1912, Rep. Ars\u00e8ne Pujo, of Louisiana, a Democrat who served from 1903 to 1913, was authorized to form a subcommittee of the House Committee on Banking and Currency. The committee became known as the Pujo Committee, albeit, in fact, its chair withdrew from nonattendance for family reasons not long after the committee's creation and was supplanted by Rep. Hubert D. Stephens, of Mississippi.

The Pujo Committee report was viewed as powerful in expanding support for confirmation of the 16th Amendment to the U.S. Constitution, which authorized Congress to impose a federal income tax.

On Feb. 28, 1913, the committee's report was submitted. It presumed that the operations of the country's greatest industrial and railroad corporations were quickly becoming consolidated in the hands of a couple of New York moguls. Further, it reasoned that the huge combined wealth of their companies had permitted them to affirm control over the country's leading banks and other financial institutions. They had the option to additional their businesses and increase their own profits through a web of "interlocking directorates," in which delegates of their own interests filled in as directors of other company boards.

The Pujo Committee's report kept up with that a secrecy of financial leaders had mishandled the public's trust by solidifying control over large numbers of its critical industries, and at last its banking system.

Impact of the Pujo Committee

Albeit little recollected today, the Pujo Committee was a sensation in its day and affected several bits of legislation that lastingly affected the American system. They include:

• Foundation of the Federal Reserve system of 12 regional banks directed by the Federal Reserve Board to reduce the power of private corporations to supply manipulate the country's money.
• Creation of the Federal Trade Commission with powers to crack down on companies participating in unfair competitive practices.
• Entry of the Clayton Antitrust Act, which defined a monopoly and made it more challenging to make one by means remembering limitations for interlocking directorates among contending businesses.

Features

• The Pujo Committee was a response to developing concern about the concentration of financial power in the hands of a couple.
• Its discoveries prompted several actions including the section of the Clayton Antitrust Act.
• The committee inferred that these couple of practiced virtual monopoly power over the U.S. financial system.