Chapter 8: Money Matters
The campaign against the Klan was not merely being waged by arresting members. The organization's moniker of the 'invisible empire' was not only fitting in terms of its geographical reach but the amount of money it brought in. The Klan's coffers weren't only filled by membership fees. Throughout its history the Klan had men with considerable means in its ranks who often donated and supported the businesses of fell members. Their second iteration in the 1920s, which reached five million members, ran much like a business and many officials used them as a platform to attain high positions but the arrest of the Grand Dragon and ensuing scandal led to a massive membership drop off.*
Nevertheless, the Klan still maintained a considerably sized network of businesses that helped the organization keep its hold on territories where it was highly active. The financial activities of arrested Klansmen were looked over in order to find links to other Klan controlled businesses. Forensic accountants put together a growing picture of the places where the Klan made and hide their money in order to keep them from reforming.
In the meantime, while the Klan's financial network was being targeted for disassembly, one meant to uplift African Americans was being formulated. After a match in Kansas City, Muhammad Ali received a letter from a man named George Markley. The letter itself has become one of the most important documents of 20th century America. It was a blueprint for the creation of an African American Business Association with branches nationwide whose job it was to economically uplift as many African Americans as possible through collective investment in their communities. The plan entailed creating connections with sympathetic businessmen and business professors who would help draft financial education courses. Members of AABA could be both blue and white collar workers, who would be part of a support network that would also allow them to invest in each other's businesses.
AABA's plans were long term, with an emphasis on sending as large a number of young African Americans to college as possible in order to increase the rate of upward mobility. Markley's letter stressed that the more African Americans in the field of law and business, the safer the community's collective wealth would be. He also explained that while these two fields were very important, he would not neglect encouraging African Americans to enter medicine, engineering or any other field of work. The key to success, Markley explained, was ensuring that intergeneration wealth was not just built up but protected.
The letter, known today as the 'Markley Memorandum,' had a tremendous impact on the socioeconomic status of African Americans within years of Ali being given the letter, though the exact circumstances that made it possible had yet to appear. The ideas outlined within it did not escape the notice of other minority groups.
Reader's Note: In the mid 1920s, the Indiana Grand Dragon D.C. Stephenson abducted, raped, and murdered a schoolteacher. The story was a massive PR nightmare for the Klan.