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Research The Federal Reserve Bank and the Relocation of the Japanese in 1942 SANDRA C. TAYLOR Introduction "THANK YOU FOR HELPING US," wrote Mary Tsukamoto, Secretary of the Florin chapter of the Japanese American Citizen's League, to the San Francisco Federal Reserve Bank's Evacuee Property Division. As she and her family joined 12,000 other Japanese being evacuated from the Sacramento area in late May of 1942, she expressed her gratitude to the Wartime Civil Control Authority (WCCA) with unintentional irony: "Ever since the be- ginning of our preparation for evacuation, we have felt the kindly hands of the army.... The wonderful sincerity with which the WCCA worked has won the complete trust and faith of thousands of bewildered, frightened Japanese."'1 Mrs. 1. Letter from Mary Tsukamoto to the Sacramento office, files of the Evacuee Property Division, Federal Reserve Bank of San Francisco, May 22, 1942. (Hereafter referred to as FRB Files.) 9 The Public Historian, Vol. 5, No. 1 (Winter 1983) ? 1983 by the Regents of the University of California 0272-3433/83/050009-22$1.00 10 a THE PUBLIC HISTORIAN Tsukamoto thanked the many "fine Americans" dled the evacuation program, but offered special Federal Reserve, whose field agents in Sacramen other cities and small towns on the West Coast had assisted the evacuees in disposing of their property in a manner intended to be consistent with American traditions of justice, fair play, and free enterprise.2 That the Federal Reserve Bank (FRB) played a role at all in the human drama of evacuation and resettlement of 110,000 Japanese, 60 percent of them American citizens, may come as a surprise. Studies of this shameful episode in American history, condoned and justified on very loose grounds of "military necessity," have focused mainly on the victims' incarceration in such internment camps as Manzanar and Tule Lake for the duration of the war. Yet the uprooting must also be studied in terms of the bureaucracies responsible for implementing the decision. It was perhaps paradoxical that the same bureaucrats capable of arriving at such a basically inhumane decision as relocation should be concerned about its humane implementation. They assumed, however, that the evacuees would resume normal lives at some future time somewhere in America, where they would need material goods to reestablish themselves. Even the army recognized that they were entitled to compensation for their possessions and that they should be protected from profiteers seeking to take advantage of the situation. That they would suffer some economic loss was assumed, but the government sought to minimize it. The question of how well the bureaucracy charged with protecting the economic interests of the evacuees did its task is the subject of this paper, which is based on an examination of hitherto-unavailable records of the San Francisco Federal Reserve Bank on the relocation.3 2. The author is indebted to Professors Roger Daniels and Geoffrey S. Smith, who critiqued an earlier version of this paper presented at the annual meeting of the Association for Asian Studies, Toronto, March 4, 1981. That paper was included in the Testimony of the Japanese American Citizens League National Committee for Redress, presented to the Commission on Wartime Relocation and Internment of Civilians, 1981. Funds for the study were provided by the Research Committee of the University of Utah. 3. The data for this study consisted of original interview records, correspondence, and official communications of the Evacuee Property Division of the Federal Reserve Bank, San Francisco. The author wishes to thank Dr. Kent Sims of the Federal Reserve, who facilitated access to this material for purposes of scholarly research. THE FEDERAL RESERVE BANK * 11 Executive Order 9066, which gave the army a evacuate everyone of Japanese ancestry from the was signed on February 19, 1942.4 The decisi reached slowly during the two-and-a-half month Harbor. Since that attack, the military command o Coast had been convinced that some form of "s ment" of the Japanese was necessary for security, the secret Munson Report to the State Departme cated in November of 1941 that there was no real li their committing sabotage.5 Secretary of the Trea Morgenthau, Jr. discussed possible evacuation as cember 11,6 but the enormous dimensions of such signed the idea to limbo, for the outbreak of the w more immediate problems to the executive's atte from the freezing of their assets, which did cause the 60,000 issei, who were ineligible for citizens Japanese to suffer from governmental actions durin were the 5,000 issei and nisei picked up in the F raids for interrogation by the Alien Enemy Hearin possible subversives. Two thousand were held in camps for the duration of the war.7 The decisio everyone of Japanese ancestry was made despite th of hard evidence of sabotage; in fact, the very provocative acts became justification for action.8 cracy then had to divide up tasks to carry out the d 4. Roger Daniels, The Decision to Relocate the Japanese Ameri Hyman, ed. (Philadelphia and New York, 1975). 5. Curtis B. Munson, "Report on Japanese on the West Coast of the United States," in Hearings, 79th Congress, 1st Session, Joint Committee on the Investigation of Pearl Harbor Attack (Washington, 1946) vol. S811, Pt. 6, p. 2684. 6. Diary of Henry Morgenthau, Jr., vol. 470, Franklin D. Roosevelt Library, Hyde Park, New York, p. 2684. 7. Michie Weglyn, Years of Infamy (New York, 1976), p. 46. Issei are first generation, born in Japan; nisei are second generation Japanese-Americans. 8. See the statements of Walter Lippman as cited in Dillon S. Myer, Uprooted Americans (Tucson, Ariz., 1971), p. 22. Basic works on the history of the relocation include Dorothy Swaine Thomas and Richard Nishimoto, The Spoilage (Berkeley and Los Angeles, 1946); Jacobus tenBroek, Edward N. Barnhart, and Floyd W Matson, Prejudice, War and the Constitution (Berkeley and Los Angeles, 1954); Roger Daniels, Concentration Camps, U.S.A.: Japanese Americans and World War II (New York, 1972); Morton Grodzins, Americans Betrayed: Politics and the Japanese Evacuation (Chicago, 1949); Audrie Girdner and Anne Loftis, The Great Betrayal: The Evacuation of the Japanese Americans During World War II (New York and London, 1969); Weglyn, Years of Infamy; and Bill Hosokawa, Nisei: The Quiet Americans (New York, 1969). 12 a THE PUBLIC HISTORIAN Lawrence Hewes, who was appointed to head the F Administration, soon realized, implementation, no guments about the wisdom of the program, was th day.9 The army, whose West Coast leadership had been so instrumental in obtaining the fateful decision, was placed in charge of evacuating the Japanese to assembly centers and from there to permanent relocation camps. General John L. DeWitt headed the Western Defense Command; Colonel Karl R. Bendetsen, head of the WDC's civilian affairs board, the Wartime Civil Control Authority, handled actual removal. That agency assisted the evacuees with their social and economic problems. The WCCA divided the task of assisting the evacuees in preparing for relocation among four existing federal agencies. The U.S. Employment Service's assignment was job relocation (for the initial assumption was that evacuees would be moved to another area and allowed to resettle freely among the local popu- lation). The Federal Security Agency was charged with providing social welfare services such as unemployment compensation. The Farm Security Administration was to oversee and administer the transfer of farm properties to new owners or tenants, and, most importantly, to see that crops were tended. The Federal Reserve Bank, in its capacity as fiscal agent of the United States, was asked to provide assistance to evacuees desiring help in equitably disposing of their property. As the bank's "Final Report" stated, the purpose of its assignment was to "forestall action by unscrupulous creditors who would take advantage of the situation," and to minimize the evacuees' losses.'0 The bank's authority stemmed from two sources: The president's Executive Order 9066, and his delegation of power to the Treasury Department. That agency clearly did not "want to bother with these little businesses and all of these properties on the West Coast," as Morgenthau put it on 9. Lawrence Hewes, Boxcar in the Sand (New York, 1957), Chapter 14. Milton Eisenhower similarly opposed the decision but had to implement it when he was appointed to head the War Relocation Authority; he soon resigned. Daniels, Concentration Camps, U.S.A., p. 91. See also Milton Eisenhower, The President is Call- ing (Garden City, N.Y., 1974). 10. "Report of the Federal Reserve Bank of San Francisco: Fiscal Agent of the U.S. on the Operations of the Evacuee Property Division as of May 22, 1942." (Hereafter cited as FRB, "Final Report,"), pp. 1-5. THE FEDERAL RESERVE BANK a 13 February 27, 1942," and shifted the burden to t serve Bank of San Francisco. In addition, the custodian delegated his authority on this issue to serve Bank and the Treasury Department in ord plication of services.'2 Thus from the outset the tasks somewhat at odds with each other: to prote of the evacuees, but also to aid the war effort b quickly as possible the transfer of properties could be moved with minimal disruption of the The Federal Reserve's Role in Relocation The operation at the Federal Reserve Bank was set up in great haste during the next two weeks. An Evacuee Property Depart- ment (EPD) was created, headed by Vice President William Hale and supervised by Assistant Cashier R. E. Everson. Branch offices opened in San Francisco, Los Angeles, Portland, and Seattle. When most of the states of Washington, Oregon, and California and part of western Arizona were designated on March 2 as Military District 1,13 field offices were established throughout the region. The bank representatives, who numbered 184 at the height of the program, were to operate as a team with the other agencies in cases where problems were interrelated, and they often shared facilities. They viewed their assignment as just another task, albeit an extraordinary one, and the officials responsible did not pass judgment on its wisdom. As time was short, the procedure for working with the evacuees was only sketched out. Anyone seeking help would be referred first to a Federal Security Agency representative, who would assist with welfare and job-related problems. Then the client would be turned over to a bank or Farm Security agent, depending on the nature of his or her problem.14 These officials 11. Morgenthau Diaries, February 27, 1942. 12. War Relocation Authority, First Quarterly Report: March 18 to June 30, 1942 (Washington, D.C., 1942), p. 6. 13. Military District 1 included the coast and interior sections of Washington, Oregon, and California and part of western Arizona. Military District 2 consisted of areas further inland in those states, and was not originally designated to be evacuated. The "prohibited" zone of Military District 1 was along the coast and the Mexican border. Daniels, Concentration Camps, U.S.A., pp. 83-84. 14. Vader Report, Office Operations, March 16, 1942, San Francisco Office, FRB Files. 14 a THE PUBLIC HISTORIAN would give advice or refer the evacuee to others f cific assistance. In practice, however, cases were r so smoothly. Although the number who actually was relatively small-the bank conducted about views-the agents were soon overworked. There w for follow-up investigations to measure the su efforts at assistance, for most evacuees had only two tween the announcement of the decision and their removal. The ability of the bank agents to solve the evacuee's financial and property problems depended largely on their expertise in fiscal and real estate matters and their ability to persuade the Anglo community to cooperate. Although the bank could freeze property in dispute if necessary, this weapon remained sheathed. On March 27, Vice President Hale informed Everson that the freezing power was to be used only if the evacuation would be delayed otherwise, or if it appeared that the evacuee was being victimized due to his imminent departure. Freezing was "seldom if ever justified," especially if litigation had been instituted, as it would be "prejudging the rights of the litigant."'5 Instead, much was made of the powers of moral persuasion. On March 20, Tom Clark, then chief of the civilian staff of the WCCA, issued a stern warning that "any person taking advantage of the confused state of mind of the Japanese to defraud them will be prosecuted by the Department of Justice." He called such miscreants "un-American, unfair, and deserving of severest censure."16 To "table" a difficult case would have meant lawsuits and delay, and perhaps would have required the complainant's return from the camps, yet haste in settling led to quick decisions that often came undone or were later regretted, while unresolved problems later became a legacy for the War Relocation Authority (WRA). The Federal Reserve officials had their work cut out for them, for exploitation of the Japanese had begun months before the evacuation order was issued. Since December 7, 1941, JapaneseAmericans had lived in a climate of fear, bombarded with rumors and misinformation, as a suspicious and frightened citi15. Memo from Hale to Everson, March 27, 1942, San Francisco Office, FRB Files. 16. Memo from Evacuee Property Department, March 30, 1942, San Francisco Office, FRB files. THE FEDERAL RESERVE BANK m 15 zenry conditioned by years of prejudice and racia was over-quick to identify them with the enemy. nent incarceration or deportation coupled with the of jobs and a lack of ready cash due to the freezi assets and closing of Japanese-owned banks thoro the Japanese minority, who were unsure whom to to do. Some moved quickly from areas designated because of their proximity to defense installa tempted, often in vain, to find more secure locati very vagueness of Roosevelt's Executive Order and niteness of plans made for its implementation their confusion. For example, the military first a encouraged voluntary migration, and then, on Ma hibited that in favor of a plan freezing movement ninety-nine designated areas in Military Zone 1 w in turn. This turnabout exacerbated an already Meanwhile, the Federal Reserve turned to the ta field agents to interview and advise those requ sistance. Neither San Francisco nor the branch of a job description for this position. Some records in attempt was made to exercise "exceptional care the highest type individuals available for the work recommendations from other bankers or leading community17 However, the work was to be of lim approximately two to six months, and there was to hire people and begin immediately. Reports fr offices make clear that the usual procedure was to hire retired bankers, federal employees, real esta people with some business experience who were w a temporary job. Their feelings toward the Japan edge of their culture or native language were not In short, they appear to have been quite typical r of the prevailing climate of opinion in their c white, middle class, and at least moderately racist after all, the products of California's "politics o None doubted the morality of the task they were t fication appeared self-evident. 17. Report from the Assistant Manager, Los Angeles Office, to San Francisco, May 30, 1942, San Francisco Office, FRB Files. 18. See Roger Daniels, The Politics of Prejudice (Berkeley, 1962 16 m THE PUBLIC HISTORIAN The selection of the head field agent for Sacramento, Reid, is a case in point. Dallas Gray was sent from Office in San Francisco in mid-March, 1942, to hire the position. He reported that none of the people he obtained from the U.S. Employment Bureau pro the "type of personality" required. Following a few tained from acquaintances in the city, he found a su date, but the man declined the job for more pe employment. Gray reported that he then interview hired him on the spot. The new head of the Sacrament the Evacuee Property Division reported for wor morning to meet his colleagues, Wayne Phelps of th curity Administration, Patricia Thayer of Federal S Ray Donnally of the U.S. Employment Service (the as coordinator of the WCCA operation in Sacram Gray spent the rest of the day meeting with leaders anese-American community to explain procedures vices the agencies could render the evacuees, Reid r instructions. Nowhere in his report did Gray men qualifications for the position.19 It would appear, f port and others, that sheer availability was one of t requisites for the job. The Federal Reserve Operation in Sacramento The manner in which the bank agents helped the prepare for relocation can best be understood by s some detail the experience of the City of Sacrament in that city served Japanese from a nine-county ar ern California. The city was of medium size and lo heart of the rich Sacramento valley; Japanese had since 1883. Although that minority probably made 10 percent of the city's population in 1942, Sacrame had the third densest Japanese population on the W While most of them were involved in agriculture, o urban residents of the city's lively Japan Town, wh 19. Report from Dallas H. Gray to Head Office, March 24, 194 Office, FRB Files. THE FEDERAL RESERVE BANK m 17 banks, churches, restaurants, groceries, hotels, an barber shops.20 Sacramento Japanese had about two months in w pare for relocation: more time than the unfortuna Terminal Island in Los Angeles harbor, who were s rooted within twenty-four hours, but still not eno office was set up in mid-March, and headed by R hired five subordinates. As Henry Taketa (a pr lawyer in the city) stated, the Federal Reserve Ba intentions, but it didn't go out asking people help."21 Taketa estimated that only one family in asked for assistance from bank agents. The remain ing the government for good reason, preferred t own problems. The agents attempted to dissemi tion through the local chapters of the Japanese A izen's League (JACL), whose leaders together community spokesmen met with Gray during h urged a rapid dissemination of information throu and Japanese organizations, so that people, "dis confused" as they were, would be prepared, and n removed by the Army en masse.22 The Buddhist to keep people informed, and throughout March local newspapers urged people to prepare for April 4, for example, the Bee reported a "final wa Coast Japanese to be ready to move, stating "no e be made."23 In the week prior to evacuation, the J distributed a mimeographed newsletter, includ note reminding people to take their pets to the Society, which promised to find them good homes Such general pronouncements left many que answered. When Gray met with community lea mento, he was asked to provide specific infor 20. Cheryl L. Cole, A History of the Japanese Community 1833-1972: Organizations, Businesses, and Generational Respo Domination and Stereotypes (San Francisco and Saratoga, Ca., and Sacramento Bee, May 7-8, 1942. 21. Interview with Henry Taketa, June 21, 1980, Sacramento, anese Community, p. 46. 22. Gray Report, FRB Files. 23. FRB Files, and the Sacramento Bee, April. 4, 1942. 18 m THE PUBLIC HISTORIAN would aid a family whose head had been arrested How could a family sell its car if the legal owner carcerated? What about the property problems of armed forces? Should families sell household go them? Would they ever be able to return?24 Beca gram had not been thoroughly conceptualized reigned supreme and bank agents could do little to As bank agents in Sacramento conducted inte those Japanese who did come in for assistance, the total of 625 forms to be sent to the San Francisco off at these forms, we can analyze the way in which t cials operated. Approximately half of the forms dealt the disposal of an automobile. Others recorded int Anglos or minority groups anxious to acquire the Japanese had to leave behind. Of the remainder, contained sufficient information to make the pr solution comprehensible were analyzed by compu comparable data was a difficult task, for the ca tremely varied. The results of this study provide a ing at the economic loss of the Japanese, as well operation of the Federal Reserve's Evacuee Proper The Sacramento office served Japanese from a n area in Northern California. One-hundred-fourteen of the 230 were residents of the city or had a rural address in Sacramento, while eighty-two came from small towns in the county and its valley neighbors. Twelve cases involved people who had already relocated once from areas in the "prohibited" district along the coast. Most, 157 of 230, represented only themselves, although about 10 percent represented others: their issei parents or other relatives, or on occasion an organization. The vast majority were males and 149 were American citizens. (The form solicited all this information, including a question asking if they had ever visited Japan. Ninety-five had; ninety-one had not.) The cases covered a wide variety of topics, ranging from ur- ban small businesses (approximately 25 percent of the cases) such as hotels, groceries, dry cleaning establishments, and nurseries, to agriculture (another 25 percent). The Sacramento City Directory listed a total of 238 Japanese businesses in the city in 24. Gray Report, FRB Files. THE FEDERAL RESERVE BANK m 19 1940.25 Never did an individual present the bank totality of his economic situation; instead, evacu only with the few problems they had been un themselves. Uprooting the Japanese was not a simple task. Vagueness regarding the final disposition of the cases makes an evaluation of the effectiveness of the bank's program in Sacramento difficult. Settlement prior to evacuation was apparent in ninety-seven of the cases, or 42 percent; the remainder were handed over to the WRA. In each relocation camp there was an Office of Evacuee Property, which attempted the follow-up that the Federal Reserve's limited program could not offer. It is difficult to deter- mine if the settlements facilitated by the bank agents were "fair"; they do appear to have been satisfactory from the agent's point of view, which was the only perspective recorded. In one-third of the Sacramento cases no information was provided as to outcome, and only one case required extensive legal research.26 In six cases it appeared that the evacuee had been pressured into accepting an offer lower than he desired; occasionally the irritation of the bank agent surfaced in a remark about recalcitrance or stubbornness. Reid noted in one case, "This man has not put his best efforts forward to liquidate his affairs."'27 The vast majority accepted the bank officers' suggestions, and occasionally recorded their gratitude in touching letters of thanks sent later from the camps.28 There was for most no time to argue, no sense that resistance could achieve anything, and the need for haste was all-pervasive. The bank's as- sistance was accepted for what it was-better than no help at all, and many people were very grateful for it. 25. As listed in Cole, Japanese Community, p. 144. 26. The Ishino-Kercheval case was the most troublesome Sacramento case, and was used as an example in the bank's "Final Report." 27. March 24, 1942, Sacramento Office, FRB Files. 28. The case of Dr. George Iki was exceptional. A prominent Sacramento physician, he cooperated fully with the officials, and even evacuated to Walerga a week ahead of the others in order to set up a 150-bed hospital. As the time of evacuation drew near, he wrote Reid asking help with his own affairs in order that he could take his office equipment with him. He received no answer, and later wrote from Tule Lake asking for references so he could borrow money to re-equip. He received the reference together with a personal note wishing him well, and suggesting that he might be able to do some fishing and hunting now that he was relocated! Sacramento Bee, May 7, 1942, and FRB Files. 20 m THE PUBLIC HISTORIAN It is unclear whether the people who called on Reserve Bank were representative in terms of the status in the community. Based on internal evid peared that eighteen were prosperous property ow eleven were in desperate financial straits. Evacuees little information about their overall situations. T community in Sacramento was certainly not prosp years immediately preceding the war; hard-hit by sion, it had not recovered by 1942. Most Japanese farmers unable to own land due to the Alien Prop California, and the majority leased their homes business.29 Only 20 percent owned either urban or erty.30 In one county, 205 of the 416 Japanese far were owners, and only thirty-seven had disposed of erty prior to 1945.31 The prosperous Japanese farm unfairly with white labor-the "yellow peril" st publicized by Sacramento publisher V. S. McClatch migration controversies of the early 1920s-was co his absence in 1942. The Japanese farmers did work on marginal lands, and they were willing to do th required to raise such truck crops as strawberries a but this had not made them rich.32 In fact, it only ad problems in 1942, for no one else wished to lease su and do that kind of work. The case of the Japanese of Florin, located twenty miles south of Sacramento demonstrated their problems, and its fate was an ex worst that could happen., When the agents encountered a complicated a 29. Cole, Japanese Community, Chapter 2. 30. War Relocation Authority, Final Report, Sacramento District, 31. War Relocation Authority, People in Motion: The Postwar Adju Evacuated Japanese-Americans (Washington, D.C., 1947), reprinted p. 67. 32. The Bee reported a week after evacuation that most of the strawberry crop would be lost, as no one was available to harvest it. May 27, 1942. 33. The Japanese of Florin raised grapes and strawberries. As the land was poor, no whites wanted to purchase or lease it, and corporations finally took over large tracts. The property stored in Florin was vandalized even as the former residents were leaving, and this continued through the war with little effort exerted by law enforcement agencies to prevent it. By the time the former owners began to return in March, 1945, the community was devastated, and many of the farms had been partially abandoned. War Relocation Authority, The Wartime Handling of Evacuee Property (Washington, D.C., 1946, Reprinted 1975), pp. 93-96. THE FEDERAL RESERVE BANK m 21 case, they conferred with the Farm Security A (FSA), whose stated purpose put harvesting of the with protecting the property interests of the farmer policy was to encourage farmers to plant in sprin the expense of seed and fertilizer, even though would be unable to harvest their crops. Those who agricultural production, so necessary in warti charged with sabotage.35 In fact, one Sacramento arrested for destroying his four acres of lettuce.36 Evacuees with complicated urban holdings wer real estate agents, commercial banks, and attorne two Japanese attorneys in Sacramento, Taketa Tsukamoto). Often the only solution to a real pro was to give power of attorney to a commercial ag friend and hope that a satisfactory solution could after the owner's departure. Sixty-five gave such torney, approximately 30 percent of the cases thirds of the Sacramento cases involved real estat owners were advised either to sell, sublet, engage manager, or, if all else failed, to give someone attorney. Farm equipment generally went with the land, and the ultimate disposition of the crops was the new proprietor's concern. The Federal Reserve was quite successful in preventing credi- tors from repossessing tractors or household equipment on which the purchaser was paying installments; when evacuation was announced, many creditors refused to accept any further payments from Japanese, instead demanding repossession of the goods. This was clearly illegal as well as unfair, and the agents stopped such harassment. Throughout, bank agents assumed that the evacuees should follow normal procedures in a free enterprise economy: advertise and sell for what the market would bear, and accept as a consequence of their haste some economic loss. Many white ad- vocates of evacuation believed that the Japanese Americans were being asked to make a normal wartime sacrifice, if any34. Farm Security Administration, "Final Report," December, 1942, Japanese- American Research Project, Bancroft Library, University of California. 35. Interview with John Tateishi, JACL, San Francisco, June 24, 1980. 36. Sacramento Bee, March 5, 11, and 26, 1942. 22 m THE PUBLIC HISTORIAN thing a lighter one than that required of draftees time circumstances, why argue about a few dolla shown by the interview records, the agents shared tions. Certainly the irritation that arose when th sional Japanese protested the economic fate being him would support such a conclusion. Automobiles, unlike household possessions, co stored indefinitely without loss. While the Sacram statistics do not reflect the total number of cases i vehicle problems represented as much as a third o the EPD throughout Military Districts 1 and 2. Di complicated by a frequently changing policy. At appeared that evacuees would be permitted to dri sembly centers; Sacramento Japanese first were to take their cars to nearby Walerga, but were disco doing so, for the vehicles would be left in open f nonetheless, hoped they might recover their cars found work near the relocation centers, so they with the government. But under pressure from th bank changed its policy, first encouraging, then de Not only was it impossible to maintain vehicles lef for indefinite periods of time, but such items we both civilian and military use. The bank ultimate appraisals of a stored vehicle's worth, and then p evacuee to sell to the army. By the end of 1942 the in storage, about one hundred, had been requisiti military.37 More than 20 percent of the people intervie Federal Reserve in Sacramento had financial pr people lost their jobs when firms acted on the prev of hostility and dismissed them. The California St Board fired all of its Japanese-American employee claiming that they "disrupted morale" and were p tors due to their dual citizenship.38 Others were p the federal government closed enemy-owned ban Eleanor Roosevelt's intercession, that order was m week after Pearl Harbor so that Japanese Americ $100 a month from their bank accounts if they h 37. Evacuee Property Division, p. 4, San Francisco Office, FRB F 38. Sacramento Bee, April 3, 1942. THE FEDERAL RESERVE BANK m 23 A Japanese-American woman working at the Tule Lake, California cam courtesy of Special Collections, Western Americana Division, Marriott Utah.) sources of income.39 However, twenty-one people reported hardships due to the freezing of their bank accounts, and another six tenants or agricultural laborers complained of their inability to collect pay due them at harvest time. Federal Security provided temporary assistance for indigents. The Sacramento office encouraged city banks to loan money on blocked ac- counts, but took no action when the local Bank of America at first refused cooperation. The FRB did make provisions for the need for funds en route to the camps, urging evacuees to retain their local bank accounts and to carry a small sum in traveler's checks. Temporary branch banks were also opened near the assembly centers. In other financial matters the field agents reminded evacuees of ongoing obligations. Insurance premiums should not be allowed to lapse, and taxes could not be forgotten. The agents endeavored to protect the evacuees' equity if they defaulted on a sales contract, but rarely did the owner gain more than the can39. Daniels, Decision to Relocate, p. 11. 24 a THE PUBLIC HISTORIAN cellation of the remaining obligation upon retur The responsibility of the field agents to protect e victimization was a source of concern and criticism from the outset. Vice President Hale advised them on April 10 that a fol- low-up to the initial interview was imperative. The agents should even seek out Japanese who might need help, and assist them with their problems. He stressed, "It is not sufficient just to advise the evacuee to settle his affairs. You should go sufficiently into details of the problem to satisfy yourself ... and then fol- low through until you have definite knowledge that it has reached a satisfactory conclusion." Instructing the agents to keep a complete history of each case, he emphasized, "Remember, undoubtedly cases will be found in the future in which we shall be called upon to defend our actions." The very fact that the bank had not received any so-called "critical" cases seemed to indicate to Hale that the treatment given advice-seekers was superficial, and a reading of the interview records themselves bears out this concern.40 Hale's warnings were echoed a month later when the Tolan Committee reported the results of a two months' investigation of national defense migration to the United States House of Representatives. The committee members held hearings on relocation on the West Coast between February 21 and March 12, 1942. While they upheld the need for evacuation because of what they considered convincing evidence of sabotage, they were not laudatory regarding the actions of the Federal Reserve.41 They charged that the bank's property program was deficient on two counts. First, it dispensed erroneous information; evacuees were urged not to store, but to sell needed property, especially household goods, which they would be unable later to replace. The committee also castigated the bank for being "cautious in the extreme," in stipulating that goods were to be stored at the owner's risk, which created a "bad psychological factor" in the minds of the evacuees.42 The Tolan Committee's criticism singled out an important 40. Instruction Letter No. 19, from William Hale to Field Representatives, April 10, 1942, San Francisco Office, FRB Files. 41. U.S. Department of the Interior, Wartime Exile: The Exclusion of Japanese Americans from the West Coast (Washington, n.d.), p. 143. 42. Tolan Committee Report, Associated Press News Release, May 13, 1942, San Francisco Office, FRB Files. THE FEDERAL RESERVE BANK * 25 concern-storage. The Federal Reserve files are f sive documentation as to the number of fire ex chased for the warehouses it provided, but t problem: the facilities were poorly guarded and ally vandalized. The suspicions the Japanese ment-provided services were fully justified evacuees were as financially secure as Henry Tak his goods with the reputable Bekin Van Lines. M their goods with friends, in churches, in private cilities, or with the government, risky or not.43 could not provide insurance, however, is an u tion; probably it would have required federal au it certainly would have cost money. The Federal Reserve was not unresponsive t established its own investigative unit, headed b On May 4 Vader reported to John W Pehle, Assi retary of the Treasury, that corrective action h The field representatives were now conducting investigations, and the information they provid was more specific and useful. Offices which had lax in recording complete case information o sheets seemed to have improved. The office Vad most deficient in this respect was Sacramento procedures improved, time ran out. The Fede are replete with thousands of form letters mai who were interviewed once, requesting them to to the solution of their problems. Few of the sponse, and those that did usually provided such mation as "I sold my farm (tractor, car)." Th "case closed." An examination of the data drawn from the interview records of Sacramento reveals no clear pattern. Citizens, far more likely to own land, appear to have sold more often than aliens, although the sample is probably too small to be significant. The Federal Reserve representatives inquired of most evacuees if they had ever been to Japan, but this information elicited noth43. Weglyn reports that an unidentified postwar survey found that 80 percent of the goods privately stored were pilfered, rifled, or stolen during the relocation; Days of Infamy, p. 77. 44. Rae Vader to John Pehle, May 4, 1942, San Francisco Office, FRB Files. 26 a THE PUBLIC HISTORIAN ing of any real relevance, nor did it appear to h the handling of the cases. The cases were too themselves to more detailed statistical analysis, a pear that Sacramento's Japanese, whether citizen treated much the same.45 The bank agents did protect people from the more obvious forms of victimization and tried to prevent others from reaping a windfall from their calamity46 Federal Reserve representatives had many contacts among local real estate agents and bankers, but no one firm seems to have profited unduly from the business it received. An examination of the most complicated case that the Sacramento office handled also shows no particular attempt to influence the settlement.47 The agents in Sacramento appear to have been as interested in an equitable solution as anyone, but in this, as in everything, external variables set the outer lim- its. A case was settled within two months: haste and the perceived need to cooperate with the military overrode everything. When on May 7 the order was finally issued to evacuate the city of Sacramento, bank representatives were on hand to help the Japanese settle last-minute concerns. During the next three days evacuees were processed in the municipal auditorium. They were registered by the agents of the U.S. Employment Service, and could confer once again with the bank, Federal Security, and Farm Security representatives. Five days later they reported at the appointed time, tagged and with bundles in hand, to board buses for the assembly center at Walerga. The evacuation of the city took three days and was completed on 45. As the land cases demonstrate, citizens and issei shared a common fate. Of forty-two landowners, thirty-three were citizens, seven issei, the remainder not identified. Twenty-two percent of the Japanese Americans interviewed owned land, 16 percent of the issei. Thirteen citizens (10 percent) and one issei sold, while 11 percent of the nisei and 9 percent of the issei leased. 46. On a complaint from one woman, Agent Reid investigated two men who were soliciting powers of attorney from the Japanese, implying that they were government agents. Reid warned the FSA of this, and asked the FBI to warn them off. FRB Files. 47. Ishino-Kercheval case, Sacramento office, FRB Files. The case, involving a dispute between a landlord and a Japanese asparagus farmer, reached such an impasse that both sides hired attorneys. The Japanese farmer, untypically, utilized a leading non-Japanese firm. The Federal Reserve office was unable to arbitrate the dispute, and asked San Francisco for assistance. The out-of-court settlement appeared to be a compromise of the differences, probably an inevitable outcome since the contract was primarily verbal and not specific. THE FEDERAL RESERVE BANK * 27 May 16; the county was evacuated two weeks lat Military District 1 had been completely cleared o The Federal Reserve in Retrospect Though the operation of the Federal Reserve B mento was typical of the procedure used elsewh had its own specific problems. In Seattle, for Japanese owned small residential hotels where tr men stayed. Finding new owners for real esta doned ghetto was difficult, particularly for marginally profitable enterprises requiring the labor of all family members. In the Los Angeles area, where the largest percentage of Japanese resided, problems were primarily agriculture-related. While most truck farms were saleable to other minorities willing to perform stoop labor, luxury goods enterprises like a cut-flower business were harder to unload. Everywhere disposition of vehicles was difficult because of time payment contracts, and tales of human misery filled the files. The question of whether the Federal Reserve Bank helped evacuees prepare for their uprooting in the best manner possible can be assessed on several levels. Much can be learned from the criticisms it received at the time, first from the Tolan Commit- tee and second from the WRA, which inherited the Japanese and their problems once they had been removed to the camps. The Tolan Committee issued a report in May 1942, part of which dealt with the actions of the Federal Reserve. While the bank appeared to have done its utmost "to prevent injustice and hardship to the evacuees, within an established framework," the committee, as noted earlier, faulted several aspects of its procedure.49 Although the bank's officers tended to discount its observations since the committee had visited San Francisco shortly before the Evacuee Property Division was operational and had stayed in the city only a few days, its complaints appear to have been valid. The WRA also criticized the actions of the Federal Reserve. In its Final Report, it listed six basic complaints. Although 48. Sacramento Bee, May 8, 1942. 49. Tolan Committee Report, ibid. 28 m THE PUBLIC HISTORIAN admitted that some economic loss was inevitable, i damental problem in that procedures for safeguar were established so slowly. Much victimization tween the time of Roosevelt's proclamation on Fe the granting of authority to the Federal Reserv This interval provided "a golden opportunity for tricksters." In the interim the federal governmen correctly, that existing social agencies could han lems. When the government did establish a p provisions were inadequate to remedy initial loss ongoing victimization. Each agency's role in the limited, and responsibility for safeguarding evac "bounded from agency to agency."'5 The Fed Bank's San Francisco office was in charge for a m while people were evacuated from their homes to centers, a task completed by August 7. The WRA trol of the operation in the fall, when the evacu relocated into the "concentration" camps that ho them for the duration of the war. It was too late by vent abuses. The bank's Evacuee Property Divis its operation on December 31, 1942. The initial losses suffered by the evacuees were by the indifference of local officials to the need to goods. These authorities closed their eyes to vand arson, and were unenthusiastic about prosecuting army, primarily interested in getting the Japan cated its responsibility for safeguarding their pro Federal Reserve could offer little help. The WRA cluded that "wartime handling of evacuee proper part of the war record."5' In a major study of relocation undertaken by th of California in 1942, the role of the Federal Rese attention. Sociologist Dorothy Swaine Thomas con the policies of the bank resulted in "something cl for virtually every Japanese-American businessm safely be concluded that every evacuee incurred s 50. United States Department of the Interior, The Wartime Han Property (Washington, 1946, reprinted 1975), RG210-F6/2, Nati 3-4. 51. Ibid. THE FEDERAL RESERVE BANK m 29 many of them suffered severe and irreparable los ble and intangible, and that the burden fell mor the small owner than the large."52 Her evalu sharply with the official report issued by the ban 1942, which noted with some pride that the pro implemented successfully: "The evacuees were the Japanese-American Citizen's League expres for the bank's help.53 The program might have been carried out succe the bureaucrat's perspective, but for the Japanese nomic disaster. Most later estimates put their pro $400 million, citing the Federal Reserve as the so terview records were clearly not the basis for th was anything else the bank published on the subje order to keep detailed interview records, few ag only rarely did dollar amounts even appear in th Since individuals only brought to the bank agents could not solve themselves, the records contain n on the property people disposed of privately. T tained detailed records on the number of interviews conducted at each field office every week, and it kept a careful accounting 52. Thomas and Nishimoto, The Spoilage, p. 16. 53. FRB, "Final Report," p. 21. 54. The $400 million figure is cited in many secondary sources, such as Weglyn, Years of Infamy, p. 276; Girdner and Loftis, Great Betrayal, pp. 436-37; Hosokawa, Nisei, p. 440; Daniels, Concentration Camps, p. 168. All cite the Federal Reserve with no specific reference. Mike Masaoka, Washington Representative of the JACL, attributed the figure to the FRB in a statement made at the Hearings of Subcommittee No. 5 of the Committee on the Judiciary, House of Representatives, 83rd Congress, 2nd Session, 1954, pp. 15-16, but he himself first mentioned it in his "Final Report" from Camp Shelby, Mississippi, dated April 22, 1944; Letter to the author from Roger Daniels, March 27, 1982. Helene Briggs, corporate services manager and former archivist, Federal Reserve Bank, San Francisco, in a letter to the author May 12, 1981, acknowledged that neither she nor the research librarians at the bank could find the source of the figure. The JACL used the $400 million figure in its work on the redress issue; see The Japanese American Incarceration: A Case for Redress (San Francisco, 1978), p. 22; and the figure came up again in the Washington hear- ings of the Commission on Redress, July, 1981. Although some sources mention other figures, ranging from $250 to $385 million-the latter is in Leonard Bloom and Ruth Riemer, Removal and Return: The Social-Economic Effects of the War on Japanese-Americans (Berkeley, 1949)-the $400 million is the most common. It has now reached the status of folk wisdom. 55. A count of the Sacramento cases reveals that only about one-third of the cases mention any specific figures. Of those, approximately one-fourth give sufficient de- tails to estimate the actual loss. A more intensive study of the entire body of the 27,000 cases will be necessary before this author can draw any hypothesis as to total economic loss based on this data. 30 m THE PUBLIC HISTORIAN of the funds it expended to run the entire opera 694.47 as of December 31, 1942).56 But the econom fered by the Japanese themselves appears not to primary concern, despite the bank's stated charge. goal soon became the preparation of the Japanese parture. It was concerned more with speed than w Time lends additional weight to the critics of t gram, which was hastily-devised, ill-conceive cedurally sloppy. The bank had no experience with and while its agents gave advice well suited to move, it was inadequate given the magnitude of The white community, for the most part anxious to unwelcome neighbors, was quick to victimize the agents could only prevent the grossest abuses, and a few of the thousands uprooted. Had they dealt w community they would have gained a better persp dimensions of the problem. Hampered by inadequ inability or unwillingness to apprehend or punish the agents failed, and in their failure they too becam a misguided policy. Through its intervention the sumed some responsibility for the tragic policy failu tion. Eugene Rostow called it, in 1945, "our wo mistake."58 One can only conclude that the mean that dubious end were inept as well. 56. FRB, "Final Report," p. 20. 57. For example, the article, "Work in Evacuees' Interests in the Bank of San Francisco," Federal Reserve Bulletin, April 1, 1943, with the economic impact of the removal of the Japanese f agriculture. 58. Eugene V Rostow, "Our Worst Wartime Mistake," Harper's Magazine 191 (September 1945): 194-201.
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