The Economy

At a point when Key West was at its prime, in the early 1900's, having the highest income per capita of any U. S. city, the carpet of prosperity was yanked out from underneath its financial foundations.  Because Key West relied so heavily upon its operations here, the U.S. government lead the way to this lively town's downfall by abandoning it as a naval base, eliminating more than half a million dollars from circulation, along with removal of the United States Coast Guard's headquarters.  Together with the loss of numerous other governmental activities, the high tariff placed by congress upon pineapples, caused the death of Key West's pineapple industry.  It is the belief of many, that the government might have saved both itself and our charming little island, a great deal of money and grief had they not departed in such an impromptu manner.

Afterwards, the Interstate Commerce Commission granted sea-train lines from New Orleans to Havana, which caused a tremendous drop in the freight business that passed by way of Key West to Cuba.

Thousands lost employment as the passenger steamship lines went out of commission, along with the decline of the fishing and sponging trade, which at one time entailed a fleet of several hundred boats.  The cigar manufacturing industry soon went, leaving tens of thousands out of work.  Some fifty factories in all, where once the finest cigars in the world had been produced, were left abandoned, only to be leveled by fire in the years to come, --with some burning more suspiciously than others.

It seemed as though people couldn't leave the island fast enough.  The Cubans moved on to Miami, a mere trading village as yet, some even returned to Cuba.  Merchants closed their shops, and even the trolleys disappeared.  The true conchs, the natives of Key West with sand in their shoes and salt in their blood, stayed to endure the hardships of the Great Depression that were being felt nationwide at this time.

The island's financial stress left the city and county unable to carry on their functions of government, causing Key West to become the first U.S. city to declare bankruptcy.  The Federal Emergency Relief Administration (FERA) stepped in, headed by Julius F. Stone, in order to set key West back on its feet.  With the idea that no other city in the country can match Key West for its historical interest and old-world atmosphere, among other elements more peculiar to nature itself, tourism was to be the hope for creating the industrial revival needed.  Through the government's aid in helping to promote tourism here, Key West became known as the Bermuda of Florida.


Conch Republic, Founded 1982