As we celebrate the nation’s birthday and reflect on its political history and evolution, it is a great time to learn about the history and evolution of America’s chambers of commerce and how they shaped the existing economic system of today.
Chambers of commerce are perhaps some of the most influential institutions in the history of economic development in America. From Medieval Merchant Guilds to colonial privateer fleets and free trade associations, chambers of commerce have a history that mirrors the formation of the modern market economy and that embodies the cultural views of the various local business communities they represented.
Although chambers were historically extensions of the economic interests of colonial European governments, the American colonies would be where these institutions’ roles changed into independent engines of free enterprise. The New York Chamber was formed in 1768 and was the first organization of its kind in North America.
These bastions of anti-tax and free trade advocates would become significant players in the American Independence movement. However, when war looked like it was on the horizon, many chambers saw this as bad for business.
“During the American Revolution, about two-thirds were loyalists (against independence) and one-third were patriots (for independence),” said Chris Mead, author of The Magicians of Main Street: America and its Chambers of Commerce, 1768-1945. “Among that one-third was John Cruger, first president of the New York Chamber.”
With the newly independent nation building up its economy, business and commercial interests reached the question of whether to focus on trans-Atlantic trade or protect America’s infant industry.
“During the early part of the industrial revolution in the 1830s, there was a debate in the Philadelphia Chamber of Commerce about which direction we wanted to go as a country,” said Mead. “In the direction of free trade and an overseas focus or of limited and protected trade with a domestic focus.”
Mead added that the members of the Philadelphia Chamber who advocated for the domestic focus and protected trade split from the group and formed the Board of Trade to distinguish itself from the Chamber.
Chamber organizations across the country were once again divided along regional and ideological lines when the Civil War broke out. Mead noted that chambers usually fell under whatever was the dominant sentiment of their geographic location with many chambers in the South supporting secession, and many in the North supporting Lincoln’s Union cause.
Chambers were quick to prioritize economic development once again during the Reconstruction period. The focus on re-establishing commerce also allowed for healing to take place between North and South and the rebuilding of disbanded chambers of commerce.
“After the war, one of the first resolutions of the recently re-established Charleston Chamber was about building a railroad between Cincinnati and Charleston,” said Mead. “What is the first thought that comes to chambers of commerce after the war? Trade.”
At the turn of the century, many business interests across the nation converged and a new unified national direction for the U.S. economy was sought.
“The New York Chamber of Commerce had been attempting, in a somewhat convoluted way, to act as a national chamber of commerce would,” wrote Mead. “Not surprisingly, once the U.S. Chamber was organized in 1912, the league was dissolved into it. The U.S. Chamber could finish the work of promoting nationwide support for what would be a nationwide banking system (the Federal Reserve).”
In the Great Depression, chambers were largely strongholds against many of the Roosevelt Administration’s government-heavy economic policies. However, by the Second World War, much of the commercial interests of the country shifted into military projects.
Indiana’s reputation for its strong pro-business environment has much to do with the history of its own chamber organizations. The earliest chamber in Indiana, according to Mead’s book, appears to have been established in New Albany around 1857.
However, there were several early attempts at forming an Indianapolis Chamber of Commerce dating back to 1853, but one would not be finally established until 1890.
The Commercial Club of Indianapolis was formed in 1890 with Col. Eli Lilly as its founding president and attempted to turn the project of business expansion and retraction into a statistical science rather than merely a marketing campaign.
On the southside of Indianapolis, the Greenwood Chamber of Commerce was first organized in 1954 and would later merge with the Johnson County Development Corporation in 2020 to form Aspire Economic Development + Chamber Alliance, the chamber of commerce serving all of Johnson County today.
The story of how each chamber of commerce formed in their respective communities will always be unique, however these institutions share an intertwined history and destiny.
As we celebrate the beginning of the American experiment, we must also acknowledge the role that chambers have played throughout its history as its testing labs of innovation, economic development, and entrepreneurship.
Eric Reingardt is the marketing coordinator for Aspire Economic Development + Chamber Alliance. Send comments to [email protected].
