Financial History Issue 128 (Winter 2019) | Page 27

By Gregory DL Morris In 2019 the city of Durham, North Carolina, celebrates its sesquicentennial. Beyond the celluloid fame of the Bull City’s baseball team is an even more inspiring story of how this town nurtured a thriving and enduring black business community. “Durham was originally a railroad depot and warehouses that prospered on tobacco,” said Angela Lee, executive director of the Hayti Heritage Center. “Tobacco meant plantations and slaves. After the Civil War there remained a large population of former slaves who had to decide their own future. They were freed, but still legally segregated; they literally had to stay on their side of the tracks.” The Hayti (“HAY-tie”) community started to coalesce about the turn of the century as formerly enslaved peoples settled in and began building. “Durham started out with numbers,” Lee explained. “There were people from the area, and others who came here from other parts of the South.” From the earliest days of settlement through colonial times, North Caro- lina was something of a neutral ground between the population and trading cen- ters of Tidewater Virginia and Maryland around the Chesapeake Bay, and Charles- ton, to the south. North Carolina lacks major navigable rivers; its marshy coast- line as well as fearsome tides and weather around Cape Hatteras kept settlements small and scattered. One important factor in the concentra- tion of people and talent in and around central North Carolina was that it suffered relatively little damage from the war that devastated wide swaths of Virginia and South Carolina on either side. Indeed its major war historical site is the Bennett Place, just outside Durham, where the last and largest surrender of Confederate troops took place. In a farmhouse between Union General William T. Sherman’s headquarters in Raleigh and Confederate General Joseph E. Johnston’s headquarters in Greensboro, those the two commanders met in the days after the more famous surrender at Appo- mattox Courthouse, Virginia. On April 26, 1865, Sherman and Johnston signed Employees of the North Carolina Mutual Life Insurance Company, which was established in Durham, NC, in 1898 and was one of Black Wall Street’s most successful businesses. surrender papers for Southern armies in the Carolinas, Georgia and Florida. It was the largest troop surrender of the Ameri- can Civil War. “Atlanta and Charleston burned,” said Lee at the heritage center. “Durham did not burn.” Instead, Durham got to work, both black and white. Perhaps the best- known Black Wall Street success story is the North Carolina Mutual Life Insur- ance Company, established in 1898 by African-American business leaders who recognized the need for an insurance asso- ciation to serve black consumers. “Go to Durham…. You need the inspiration. Go to Durham and see Negro businesses with aggregate capital of millions. Go to Durham and see 22 Negro men making modern history. Among your New Year’s resolves, resolve to go to Durham!” —1928 editorial in The St. Luke Herald (Richmond, Virginia), a black weekly It is important to note that these were already established professionals with the wherewithal to form a well-capitalized firm, and also with sufficient respect within the white local and state power structure to be left unobstructed. There were also black consumers, not just cus- tomers, but professionals, homeowners and artisans. According to its official company his- tory, “North Carolina Mutual Life Insur- ance Company was born out of a heart-felt desire and determination to serve the underserved. In 1898, African Americans were fewer than three decades from slav- ery. Established insurance companies had little or no interest in marketing to the black community. Just meeting end-of-life expenses and being able to bury a loved one with dignity—something that can be achieved through life insurance—were beyond the means of a great portion of African Americans.” The use of the word “mutual” in the name was deliberate, the company explained. “When our founders decided to create an insurance company for the African-Amer- ican market, they each had to contrib- ute from their own resources, making it a mutual undertaking. Similarly, each policy- holder gained a small stake in the company, with the health of their policy dependent on NC Mutual’s progress. The success of this mutual enterprise was a tremendous source of pride for African Americans in Durham and across the country in those early days of freedom.” While the business model has changed over the years, NC Mutual contin- ues to provide access to life, health, disabil- ity and annuity insurance for a diverse com- munity in the area and around the state. Its seven organizers were men who were active in business, educational, medical and civic life of the Durham community, and the firm has been a catalyst for minor- ity, social and economic development. Racial self-help and uplift are traditions of the company dating back to its founding. The phrase “merciful to all” was the com- pany’s first motto. John Merrick, an entrepreneurial bar- ber with substantial real-estate holdings, and Dr. Aaron Moore, Durham’s first African American physician, were two of the most active founders, according to the company history. When financial troubles forced five of the seven found- ers to leave the venture, Moore, Merrick and Moore’s nephew, C.C. Spaulding— who later served as the company’s long- time president—reorganized the firm. The three became known as the Triumvirate. “In the time of Jim Crow, significant efforts were made—through a legal and informal means—to relegate African Amer- icans to second-class citizenship,” said Ben Speller, a senior research fellow at North Carolina Central University in Durham. “There were businesses that blacks could not patronize, and these men decided to fill in the gaps. If white-owned insurance agen- cies and banks could not or would not serve blacks, people like Merrick, Moore and Spaulding would provide those services.” To that end, NC Mutual formulated its concept of the “double-duty” dollar. Mod- eled after popular mutual benefit societies, the premise was that income from insur- ance sales could be channeled back into the community. Throughout its history, the company has had programs to build strong families and communities through www.MoAF.org  |  Winter 2019  |  FINANCIAL HISTORY  25