History of Galveston, Texas - Rebuilding and The "Open Era"

Rebuilding and The "Open Era"

Despite attempts to draw new investment to the city after the hurricane, Galveston has never fully returned to its previous levels of national importance or prosperity. Development was also hindered by the construction of the Houston Ship Channel, which brought the Port of Houston into direct competition with the natural harbor of the Port of Galveston for sea traffic. To further her recovery, and rebuild her population, Galveston actively solicited immigration. Through the efforts of Rabbi Henry Cohen and Congregation B'nai Israel, Galveston became the focus of an immigration plan called the Galveston Movement that, between 1907 and 1914, diverted roughly 10,000 Eastern European, Jewish immigrants from the crowded cities of the Northeastern United States. Additionally numerous other immigrant groups, including Greeks, Italians and Russian Jews came to the city during this period. This immigration trend substantially altered the ethnic makeup of the island, as well as many other areas of Texas and the western U.S.

Though the storm stalled economic development and the city of Houston grew into the region's principal metropolis, Galveston regained some of its former glory. Recognizing the need for Galveston to diversify from the traditional port-related industries, in 1905 William Lewis Moody, Jr., a member of one of Galveston's leading families, founded the American National Insurance Company. Two years later, Mr. Moody would further invest in Galveston by establishing the City National Bank, which would later become the Moody National Bank.

The Galveston–Houston Electric Railway was established in 1911 and ran between the city and Houston. The railway was recognized as the fastest interurban line in 1925 and 1926.

During the 1920s and 1930s, the city re-emerged as a major tourist destination. Under the influence of Sam Maceo and Rosario Maceo, the city exploited the prohibition of liquor and gambling in clubs like the Balinese Room offering entertainment to wealthy Houstonians and other out-of-towners. Combined with prostitution which had existed in the city since the American Civil War, Galveston became known as the sin city of the Gulf. Galvestonians accepted and even supported the illegal activities, often referring to their island as the "Free State of Galveston." The island had entered what would later become known as the open era. Aside from the vice-oriented entertainment the city hosted many legitimate entertainment venues and events. One of the most famous was the annual "Pageant of Pulchritude" beauty contest. This event became the first international contest and attracted participants from England, Russia, Turkey, Brazil, and many other nations until its demise in 1932.

The 1930s and 1940s brought much change to the Island City. During the World War II, the Galveston Municipal Airport, predecessor to Scholes International Airport, was redesignated a U.S. Army Air Corps base and named "Galveston Army Air Field". The United States Army Corps of Engineers, using funds made available by Congress through the Civil Aeronautics Authority, constructed three 6,000-foot (1,800 m) long, hard-surface runways at the airport to accommodate army aircraft. In January 1943, Galveston Army Air Field was officially activated with the 46th Bombardment Group serving an anti-submarine role in the Gulf of Mexico. Later it was replaced by the 10th anti-submarine squadron, flying RM-37 Lockheed Venturas.

In 1942, William Lewis Moody, Jr., along with his wife Libbie Shearn Rice Moody, established the Moody Foundation, with the purpose of benefiting present and future generations of Texans." The foundation, one of the largest in the United States, would play a prominent role in Galveston during later decades, helping to fund numerous civic and health-oriented programs.

The end of the war drastically reduced military investment in the island. Increasing enforcement of gambling laws and the growth of Las Vegas put pressure on the gaming industry on the island. Finally in 1957, Texas Attorney General Will Wilson and the Texas Rangers began a massive campaign of raids which wrecked gambling and prostitution in the city. As these vice industries crashed, so did tourism taking the rest of the Galveston economy with it. Neither the economy nor the culture of the city was the same afterward. Civic leaders made several failed attempts at new ventures including the failed Oleander Bowl football tournament and the Pelican Island Bridge for access to a new industrial park which never materialized. Nevertheless, key non-entertainment sectors such as insurance, banking, and the medical school helped to keep the economy viable.