Federal Reserve System created

Senator Nelson Aldrich, head of the bipartisan National Monetary Commission, led efforts to reform the U.S. monetary system by studying both domestic and European central banking models. In 1910, Aldrich and top New York bankers drafted the "Aldrich Plan," which proposed a central bank with regional branches and an elastic currency backed by gold and commercial paper. While Aldrich initially sought a politically independent central bank, he was persuaded to include public sector representation to make the plan more viable. However, his close ties to elite bankers fueled opposition, particularly from rural and progressive factions who saw the plan as favoring Wall Street. 

The Aldrich Plan failed to pass in 1912 after Democrats gained control of Congress and the presidency, but it heavily influenced the Federal Reserve Act. With modifications to ensure more government control, the act passed in December 1913 under President Woodrow Wilson, establishing the Federal Reserve System as the new central banking authority.