Robert B. Mitchell's Blog, page 9

Asked and answered: Credit Mobilier, government ethics and journalism

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I enjoyed the privilege recently of answering questions about Congress and the King of Frauds in the Fall 2018 issue of The Guardian, the official publication of the Council on Governmental Ethics Laws. My thanks to my old friend Steve Berlin for making this possible.

Q: Can you describe how the scandal worked?

A: One of the reasons this story is so complicated is that there were two scandals. One involved the operation of Credit Mobilier – a company used by major Union Pacific stockholders to pay themselves to build the railroad. Credit Mobilier inflated construction costs and took payment in Union Pacific securities, then resold those securities. The enterprise was fabulously profitable because Credit Mobilier inflated construction costs and passed them on to the railroad. The other scandal stemmed from the revelations of the New York Sun, whose expose included letters by Oakes Ames to fellow (and rival) investor Henry S. McComb in which Ames said he was selling Credit Mobilier shares to members of Congress to magnify the influence of the Union Pacific in Congress. “We want more friends in this Congress,” Ames explained in one note. The brazen description of his motives outraged the public, which was becoming deeply suspicious of the economic and political power of the railroad industry.

 

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The New York Sun, Sept. 4, 1872

Q:  The story of how the scandal was revealed to public is intricate, but involves someone who comes as close to an “ethics hero” in this story as anyone: Jeremiah Sullivan Black.  Black “play[ed] the part of the consummate Washington insider,” and had served as Attorney General and Secretary of State, and basically leaked the story to colorful, heavy-drinking New York Sun reporter, Albert M. Gibson, after Gibson visited with Black’s son at Black’s country estate in Pennsylvania.  Black was counsel to Henry S. McComb, who was suing Ames to obtain more shares of Credit Mobilier stock.  What seems to have convinced Black to leak details to Gibson was his opinion that “the relationship Credit Mobilier had with congressional legislation showed him how impossible it was for a member of Congress to hold stock in it without bringing his private interests in conflict with his public duty.”  This is, of course, the essence of government ethics, but apparently there was widespread blindness to it in the decade following the Civil War.  We might term Black a “whistleblower.” Can you comment on his motives for going to the press rather than, say, the Attorney General? Ironically, Black was representing McComb in what was in effect a breach of contract case involving Credit Mobilier stock — there was no honor among thieves here. It is possible that, but for Black’s conscience, and the contractual dispute between McComb and Ames, this scandal may never have been brought to light.

A: This is a fascinating perspective. I’m inclined to see Black somewhat differently — as a sort of prototypical Washington wirepuller. Consider: he represents McComb but advises Garfield, a beneficiary of the Ames stock sales that led to McComb’s suit. He poses as a principled litigator who puts the interests of his client ahead of any partisan considerations but leaks the story to the New York Sun, thereby triggering months of outraged headlines in the press. What business did he have talking to Garfield at all when he was supposed to be representing McComb?

Black filed his suit on behalf of McComb in November 1868. The Justice Department was not created until 1870. Until then the attorney general acted as the president’s lawyer and represented the government before the Supreme Court. In any event, I think Black – a lifelong and partisan Democrat – would not have been interested in taking his case to a Republican administration.

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Judge Jeremiah Black. Library of Congress.

One of the interesting, if sobering, features of this story is that there are no white-knight heroes. There are, however, moments when figures in the story rather eloquently articulate the issues at stake.

Sen. James Bayard of Delaware recognized the ethical dilemma posed by ownership of Credit Mobilier shares and declined to buy them because he did not know enough about the company and what it may have wanted on Capitol Hill. “I could not consistently with my views of duty vote upon a question in which I had a pecuniary interest,” he wrote.

Sen. Lot Morrill of Maine, who led the Senate committee investigating the scandal, eloquently rebuked Sen. James Harlan of Iowa for taking large campaign contributions from Thomas C. Durant. “The use of large sums of money to influence either popular or legislative elections strikes directly at the fundamental principle of a republican government,” the committee’s report warned. “It excluded merit from public place and undermines the public and private virtue upon which alone republican institutions can stand.”

Likewise, Luke Potter Poland led the deeply flawed House investigation but warned his colleagues against giving Ames and James Brooks of New York a pass on their involvement in the scandal (the House chose to censure, rather than expel, them as Poland wanted). If they didn’t take the decisive step of expelling Ames and Brooks, Poland warned, lawmakers “will soon encounter a tempest of public judgment” – and they did, in 1874. These are moments of ethical clarity. But there are no heroes.

Q: Where was the Department of Justice, the Attorney General and the U.S. Attorney’s office during this five-year period, 1867-1873?

A: The Justice Department was created in 1870 as the Grant administration struggled to suppress the white terrorism of the Ku Klux Klan – well after Black filed his suit on behalf of McComb in 1868.

Q: The House of Representatives seemed comparatively quick to respond, and, at the behest of James G. Blaine, appointed a special bi-partisan committee, chaired by Luke Poland.  Blaine was its first witness.  But the Committee held its hearings closed to the public, although its findings would be made public at the conclusion of the investigation.  It is difficult to imagine that, post-Watergate, Congress would ever allow such hearings to be closed, although the Office of Congressional Ethics and the House and Senate Ethics Committees would investigate confidentially.  And, your understated, rather arch description of Blaine himself as a “charismatic politician who choreographed the creation of the Poland Committee [but] never shook the suspicion that his love for the machinations and theater of politics disguised a lack of principle” seems an apt description of personalities we see in government today. It makes me wonder whether anything really has ever changed in politics since the time of the ancient Sumerians: courtiers are forever protecting themselves and their reputations.  Do you think Congress learned one or more lessons from the Poland Committee’s decision to deliberate in “executive” closed session? 

A: My impression is that politicians will always put their own interests ahead of the public good unless they are remarkably principled or compelled to do so by the voters. That, I think, is why the hearings were opened to the public. It was immediately clear that conducting the investigation behind closed doors – which was the traditional approach, according to Poland, was an enormous political miscalculation. Too many years in journalism lead me to conclude that the value of openness was not a lasting lesson.

Q: What, if any, penalties were assessed against the perpetrators, aside from censure or reputational damage?  No one went to jail, and no criminal charges were brought. Instead, some could view this as a case of insiders-protecting-other-insiders-of-their-own-party.  Why is that? Do you think this may be because people were shocked that such a widespread fraud even occurred?  

A: Oakes Ames and James A. Brooks were threatened with expulsion by the Poland committee, but the House voted to censure them instead. Sen. James Patterson of New Hampshire was threatened with expulsion by the Morrill committee, but the Senate didn’t even take the matter up for a vote. None of the House lawmakers who bought shares from Ames were sanctioned in any way. A majority of House members apparently believed there was no evidence of wrongdoing. They dismissed the Ames letter as meaningless bluster and subscribed to the view advanced by Jeremiah Black to Garfield – that Ames may have offered a bribe with his Credit Mobilier shares but those who bought it were not necessarily guilty of receiving a bribe. As a layman I find this implausible, to say the least. I think you are right – this was a case of insiders protecting insiders.

Q: Last, and perhaps most importantly, the newspaper business played a large role in reporting the scandal.  As a career journalist, your observations about and choice [often quite funny] quotes from what you call “the no-holds-barred journalism of the 1870’s, almost completely without even the pretense of objectivity or impartiality,” and the Memphis Daily Appeal’s scathing editorial regarding Vice President Schuyler Colfax are wise and delicious, actually.  As is the description you cite of Vermonter Luke Poland by New York Times report “Grace Greenwood”: “I suspect, from his tone and manner,  that he once was a Methodist minister of the best type, but that, in some hour of weakness, this ornament of the American pulpit … backslid into the American Congress.”  The writing was far more rancorous and bitter than anything we see out of mainstream media these days [except in op-eds], and more analogous to what current readers see in hyper-partisan blogs and ‘zines or other publications.  Do you think this scandal led to the creation of reporters who specialize in political corruption and machinations, that is, a more dedicated press corps? How did it shape political journalism generally?

 

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The masthead of the New York Sun.

A: That’s a very good question. Investigative journalism was in its infancy and still badly compromised by partisanship and sloppy editing. Moreover, what some call today “fake news” was a real phenomenon. In 1874, the New York Herald published a hair-raising story about the escape of ravenous wild animals from the Central Park Zoo. It was completely fictitious. In the short term, newspapers like the New York Sun remained aggressively adversarial. But the notion of objectivity – reporting on events without regard to party or ideology – was still a long way off. Well into the 1960s, many big city dailies employed “political editors” who acted as liaisons between publishers and their favored candidates and parties.

 

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Congress and the King of Frauds: Corruption and the Credit Mobilier Scandal at the Dawn of the Gilded Age. On sale at Amazon.com

 

 

 

“Gath” and Gilded Age Washington

Few Gilded Age journalists wielded their pen with greater effect than the correspondent known as “Gath.”

Born in Delaware in 1841, George Alfred Townsend came to prominence as a correspondent for the New York Herald and New York World during the war and the hunt for Abraham Lincoln’s assassin that followed. In the introduction to a volume based on his memoirs of covering the Civil War, Lida Mayo writes that Townsend “loved the life of a correspondent”– a passion that comes through in his writing, whether the subject was the war or the scandal-filled years that followed.

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George Alfred Townsend, a k a “Gath.” Library of Congress photo.

He was a journalist and novelist. His western Maryland estate is now a state park that features a monument to the “Bohemian Brigade” of Civil War correspondents.

Townsend had a writer’s eye for detail and a penchant for pointed observation. Describing Richmond, which he entered shortly after its fall to Union forces in 1865, he noted the absence of churches or factories along the James – “only here and there a pleasant mansion, flanked by Negro cabins” – to make a broader point about the stagnation of the slave economy.

A bronze equestrian statue of George Washington, located near the fallen rebel capitol, offered an opportunity to comment on the folly of secession. “Gazing beyond at the capitol itself, and back again at the figure which overlooks the building, it is not hard to imagine that, while the noisy debates of a congress of traitors to the Union that he founded were in progress, those bronze lips sometimes smiled in scorn.”

In the years after the war, Townsend wrote for the Chicago Tribune, where he assumed a pen name made up of his initials – G-A-T with an “h” at the end for good measure. The resulting non de plume reflected Townsend’s religious upbringing (he was the son of a minister) and his capacity for whimsy. Gath was a Philistine city whose inhabitants were afflicted with illness when the captured Ark of the Covenant was brought into town (1 Samuel 5: 9) — and it was the home of Goliath (1 Samuel 17:4).

Like the rest of the country, Townsend grappled with the legacy of the war. His contempt for the rebels was never in doubt – he rolled his eyes at the worship of Stonewall Jackson by Lost Cause romantics – but he had little sympathy for Reconstruction. A tour of the South in 1872 for the Chicago Tribune detailed corruption in Arkansas and South Carolina while discounting or ignoring the plight of former slaves. His reporting from below the Mason-Dixon Line helped crystallize emerging Northern impatience with post-war efforts to rebuild the South.

Townsend traveled widely for the Tribune – not only down south but to Boston as well. He wrote about Louis Napoleon and the actor Edwin Forrest. His columns from Washington described the dueling grounds at Bladensburg, Md., as well as political events. His expansive reporting led, in 1874, to the publication of Washington and Inside, perhaps the best of the “guide-to-your-nation’s-capitol” books that appeared in the years after Appomattox.

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But it was as a chronicler of the sleazy politics of the Gilded Age that Gath excelled. Few if any correspondents of the day could write more vividly about the personalities that dominated the Capitol.

That became evident in one of Gath’s first pieces in the Tribune, in which he compared two prominent congressional Republicans — smooth, oily Ohio Sen. John Sherman and Rep. Elihu Washburne of Illinois.

Sherman “displays a deferential modulation, a soft gesture of the head and flowing motions of the palms,” Townsend wrote. Sherman was skilled at the art of persuasion but perhaps less attuned to the ethics of the issues about which he speaks. “[N]o man in the United States knows right from wrong so well as John Sherman,” Townsend told his readers, “or makes the distinction so infrequently.”

Washburne, on the other hand, exhibited a refreshing economy of language as he spoke on an appropriations bill. Where Townsend found Sherman unctuous and oily, Washburne presented a “large, broad, ‘square-footed’ bearing’” that projected a combative honesty.

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Rep. Elihu Washburne. Library of Congress.

“I thought,” Townsend wrote, “that if all this Congress could imbibe his spirit, to say ‘no’ to office beggars and lobbyists, to permit no easy nature to yield up each member’s personal custody of the Treasury but hold in fierce and unrelenting vigilance every dollar and every officer, how worthily this year might be made to appear among the recent years of physical courage – a year of moral courage, of sacrifice, and of honesty.”

Although vivid, Townsend’s description of Washburne reveals what was his greatest weakness as a writer. Even allowing for the stylistic differences of nineteenth-century writing, his literary toolkit did not come equipped with brevity or declarative sentences.

Nevertheless, Townsend – and a handful of others, notably Henry Van Ness Boynton of the Cincinnati Gazette – represented something new and important as journalism began to become a profession rather than an extension of partisan politics.

That became evident in the early weeks of the Credit Mobilier sensation in 1872. Shortly after the New York Sun published its expose of the stock sales to members of Congress, the Tribune sent Townsend to Philadelphia to get to the bottom of the scandal.

Why Philadelphia? That’s where disgruntled Credit Mobilier investor Henry S. McComb had filed suit against Republican Rep. Oakes Ames of Massachusetts to obtain more shares of the profitable Union Pacific construction subsidiary with the strange name. In the course of deposition testimony, McComb produced letters from Ames in which the lawmaker explained that he had no more shares to provide because he was placing it with members of Congress to promote the interests of the Union Pacific.

In chasing down the story, Townsend accomplished something remarkable. His piece for the Tribune, published Sept. 17, 1872, focused on the story behind the story and represents an early example of the press reporting on itself. He retraced the steps of New York Sun correspondent Albert M. Gibson, who broke the story, and concluded that the scoop was the result of careful scheming by McComb’s attorney, Jeremiah Black.

Recalling the sensation of hitting pay dirt as he investigated what would become the biggest story of his career, Gibson in later years wrote that “To say that I was startled at my ‘find’ would inadequately explain my mental state.” Townsend, writing for the Tribune, concluded the discovery was somewhat less miraculous — it “had first met the eye of Jerry Black.”

Townsend’s investigation of the story would lead him to McComb, toward whom he seemed to take a liking. The Delaware-born railroad speculator displayed a “semi-Southern tone and spirit of genial address, magnanimous personal impulses, the touch of honor, and the carriage of a man of the world, yet heedful of his reputation.”

But Townsend was nothing if not intellectually honest. In the years to come, he would revise his generous assessment of McComb, who died in 1881 after reckless speculation in Mississippi railroads. The man he once saw an aspiring Cavalier had revealed himself to be “jealous of money and belligerent when deprived of his share of it.”

The work of Townsend, Boynton, Gibson and other Gilded Age scribblers is chronicled in Congress and the King of Frauds: Corruption and the Credit Mobilier Scandal at the Dawn of the Gilded Age, available at amazon.com

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Remember the Whigs

Its lifespan as a political party — measured by its presidential candidates — was less than 20 years. Only two of its nominees  were victorious. It counted some of the greatest statesmen of the antebellum era among its leaders but could only capture the White House with apolitical military mediocrities. Both died shortly after they were inaugurated, succeeded by politicians even less capable than they were. In the end, the party proved unable to withstand the pressures caused by the escalating crisis of slavery and Union and by 1856 gave way to the Republican Party.

Yet the Whig Party left a legacy that endured through much of the nineteenth century.

I have been intrigued for years by the lasting influence of this short-lived party, which emerged as an organized opposition to the Democratic Party in the 1830s – a fascination that has been rekindled as I make my way through the remarkably readable new biography of Whig statesmen Henry Clay by James C. Klotter.

My interest is due in large measure to the fact that the heritage of the Whig Party and its leading figures figure prominently in two subjects close to my heart: the Credit Mobilier scandal and, perhaps surprisingly, the political career of Iowa Populist James B. Weaver.

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The 1848 Whig ticket of Zachary Taylor and Millard Fillmore. Library of Congress.

As Klotter recounts, Clay ran three times for the presidency and lost (twice, in 1824 and 1832, prior to the emergence of the Whig Party), a record equaled only by William Jennings Bryan. As Clay’s experience suggests, the Whig legacy has much more to do with the ideas and aspirations of its leading figures –Clay in particular – than success at the polls.

Indeed, in a sign foretelling the factionalism that would lead to its doom, no fewer than three Whigs ran for the White House in 1836. One of those candidates, frontier military hero William Henry Harrison, succeeded four years later at the head of a united Whig ticket and defeated President Martin Van Buren. When Harrison died, one month after being sworn in, he was succeeded by Virginian John Tyler, a Whig in name only who was far more sympathetic to Democrats than his fellow party members.

Eight years later the Whigs turned to another military hero, Zachary Taylor, and trounced Democratic nominee Lewis Cass. Taylor died shortly after taking office and was succeeded by Millard Fillmore, a political figure whose very name has become synonymous with political hackery.

Nevertheless, in spite of its factionalism and electoral weakness, in spite of the stumblebums who held the nation’s highest office in its name, the legacy of the Whigs helped shape the politics of the Gilded Age.

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Henry Clay in 1844. Library of Congress.

Many of the party’s leading figures, most particularly Clay, advocated a role for the federal government – particularly regarding finance and infrastructure – that was well ahead of its time and stood in stark opposition to the small government ideology that prevailed among Democrats.

That notion was promulgated by Clay more than a dozen years before the Whigs coalesced. The Kentuckian, well aware of the West’s need for capital, championed a national bank. At the same time, he backed tariffs and was a fervent supporter of federal efforts to build roads and canals to improve the nation’s primitive transportation network. Clay would back away from his vision of a federal role in what were then known as “internal improvements” and today would be called, less elegantly, “infrastructure,” as he chased Southern support for the Whig nomination in 1840, historian Michael F. Holt notes in his masterful history of the Whig Party. Nevertheless, the idea retained powerful support at the grass roots in the Mississippi Valley and Northeast.

That became abundantly clear in July 1847, when delegates from twenty-four states gathered in Chicago to protest President Polk’s veto of an internal improvements bill. Some Democrats numbered among the throng at the “River and Harbor Convention,” but the number of prominent Whigs was notable. They included, according to Doris Kearns Goodwin, Thurlow Weed and Horace Greeley from New York; Schuyler Colfax of Indiana; and a young Illinois Whig named Abraham Lincoln (described by Greeley in the pages of the New York Tribune as a “tall specimen of an Illinoisan”).

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Lincoln in 1859. Library of Congress.

The gathering closed with a speech by Missouri Whig (and future Lincoln Cabinet member) Edward Bates described by Greeley as “so able, so forceful, so replete with the soul of eloquence” that the famous editor was unable to transcribe it. While the convention declined to debate whether to support construction of a transcontinental railroad during its formal proceedings, the topic was taken up after the formal proceedings were closed. Delegates who stayed endorsed a transcontinental railroad, to be “constructed and owned by the Nation, its directors being chosen by the People of the several states, the Lands along the route withheld from the clutch of the speculator,” according to Greeley.

The national fervor for internal improvements intensified as railroads spread across the country in the 1850s. The dream of a transcontinental railroad preoccupied Democrats and Republicans alike, but it was the party led by Lincoln, the gangly ex-Whig noted by Greeley, that made it a reality in 1862 with passage of the Pacific Railroad Act.

In the years that followed, millions of dollars in government-subsidized bonds and land grants went to the Union Pacific and the Central Pacific as they hurried to build the railroad that would connect California with the great cities and agricultural regions to the east. Clay, I can’t help but believe, would have approved.

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Edward Bates in 1855. Library of Congress.

Many Whigs recognized that the federal government played an essential role in promoting interstate commerce through the creation of a national transportation network of roads, canals, harbors and railroads. Many would also have been horrified by the venality that accompanied the government-backed railroad boom of the 1860s and early 1870s.

While many Whigs were dealmakers like Clay or practical politicians like Thurlow Weed, others were more high minded – particularly in the party’s early days. Holt writes that a powerful strain of “anti-partyism” animated by an evangelical Christian belief in freedom of conscience permeated Whig political culture. “Because party discipline required men to sacrifice their own views for the good of the organization, because it encouraged blind obedience rather than independent action, party organization crushed freedom of conscience and made men moral slaves,” Holt writes.

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A young James B. Weaver.

Whatever else could be said of him, James B. Weaver – a Democrat in his youth who turned to the Republican Party before carrying the Greenback-Labor and Populist banners in presidential campaigns and then returning to the Democratic Party – chafed at the notion of party discipline.

In part this was due to his personality. Combative, a devotee of the cut-and-thrust of debate and speechmaking, Weaver reveled in controversy. “He is best seen in action on the stump,” the New York World wrote in 1892. “He is a fighter. He fears nothing, and he plunges forward in discussion confident that his cause is just and certain that he will win his audience to his side.”

But the zigzag course of Weaver’s crusading political career was charted to a large degree by his youthful exposure to Whig ideology. His brother-in-law and law partner, Hosea B. Horn, was an Indiana native and prominent Iowa Whig who ran as the party’s candidate for state treasurer in 1852. Later that decade, Weaver studied law in Cincinnati under Whig lawyer Bellamy Storer, who advocated – as many Whigs did — placing Biblical precepts at the center of political and legal life. “The healthy vigor of no government can be preserved, where the same rule that teaches man to fear his Maker is not equally the controlling motive of the law giver,” Storer asserted.

Raised in the frontier religious culture of camp meetings and Methodist circuit-riders, Weaver fervently embraced that view. He returned from Cincinnati newly committed to fighting the spread of slavery. He left the Democratic Party for the new Republican Party. When he broke with the Republicans in the 1870s over its opposition to paper money as an antidote to the economic suffering caused by the Panic of 1873, he did so citing the example of Jesus. “Don’t pray to get the Lord on your side, but just get on his side, for he is a friend to the poor and the oppressed under all circumstances, and on all occasions,” he told an audience in Newton, Iowa in 1878.

The Whigs arose in opposition to Andrew Jackson. Many – alas, certainly not all – of the party’s leading figures opposed slavery. Their legacy includes the ambitious program of railroad construction championed by Republicans in the 1860s and early 1870s and an emphasis on freedom of conscience in the political sphere that seems remarkably healthy in this day and age.

Today, the Whig Party has been largely forgotten in an era when everything seems to revolve around the partisan poles of the blue or red, Democrat or Republican. It deserves a better fate.

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The shadow of the Whigs looms behind the subjects of my two books: Congress and the King of Frauds: Corruption and the Credit Mobilier Scandal at the Dawn of the Gilded Age and Skirmisher: The Life, Times, and Political Career of James B. Weaver . Both are available at amazon. com .

The coming wave

It began to build in the summer of 1873.

Newspaper editors, attuned to the mood of their readers, felt it coming. Politicians from Maine to Oregon – two of the 16 states that held off-year elections between congressional and presidential elections – sensed it too, and tried to respond accordingly.

Mid-term congressional elections are viewed today as referendums on the president. The party in power in the White House typically loses seats in the House and sometimes, as in 1994 and 2006, loses control of one or both houses of Congress in what has come to be known as a “wave” election. Many believe one is coming this fall.

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A print from 1873 showed a farmer in a “Granger shirt” explaining the movement’s principles to visiting politicians. Library of Congress.

Modern historians and political junkies point to the congressional election of 1874, in which Democrats went from being a picked up 92 House seats, as the defining wave election of the Gilded Age. That election brought to an end Republican control of the House that began on the eve of the Civil War and marked the beginning of a 20-year era in which presidential elections were decided by razor thin margins.

While the party of Lincoln still controlled the Senate and the White House in the aftermath of its drubbing in 1874, its days of unchallenged hegemony in Washington were over. But the dramatic results of 1874 were foreshadowed by state balloting that occurred one year earlier.

Today, only four states – New Jersey, Virginia, Mississippi and Louisiana – hold off-year gubernatorial and legislative elections (Kentucky elects its governor in off-year balloting but votes for state legislators in even-numbered years). But the practice was far more common in the 19th century, and far more important. With U.S. senators chosen by state legislatures, state elections took on a national significance they don’t possess today.

As the two parties mobilized for elections that would determine the control of state houses, voter discontent was palpable.

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The New York Sun headline on its scoop revealing the Credit Mobilier stock sales in Congress. Library of Congress.

The state elections followed on the heels of two disastrous missteps on Capitol Hill. The Credit Mobilier scandal – the discovery that members of Congress were buying profitable stock from a colleague who was selling the shares to promote the interests of the Union Pacific Railroad – preoccupied the House and Senate and filled front pages from New York to Sacramento.

Three congressional investigations (catalogued in previous blog posts) generated embarrassing revelations and disclosed that members lied about their stock purchases from Rep. Oakes Ames. Despite evidence that the stock was sold to further the interests of the railroad – evidence drawn from letters written by Ames and the lawmaker’s own testimony — the House took no action against anyone who bought the stock. The House committee investigating the stocks sales recommended the expulsion of Ames and Rep. James Brooks, D-N.Y., but they were merely censured for their actions.

This was bad enough. But Congress compounded its difficulties by voting itself a retroactive pay raise that earned universal condemnation from the public and the press. The so-called “salary grab” quickly became a serious liability for incumbents – particularly those who voted for it.

While Credit Mobilier and the salary grab hung in the air as state party bosses began to plot their fall campaigns, additional concerns loomed behind the specter of scandal and self-enrichment.

Violent resistance to Reconstruction in the South began to take its toll on Northerners weary of strife and sympathetic to the racist view that African Americans weren’t capable of self-government. Reconstruction wasn’t on the ballot in the state elections of 1873, but it cast a pall over the electorate.

In September, a massive stock-market crash forced banking houses to close and businesses to shut their doors and lay off workers. The damage caused by the Panic of 1873 would occur slowly and become more pronounced after the election, but it represented another worrisome development that could only make voters less sympathetic to the party in power.

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The closing of the New York Stock Exchange on Sept. 20, 1873, in Frank Leslie’s Illustrated Newspaper. Library of Congress.

Finally, farmers across the Midwest and South mobilized in opposition to the rising political and economic clout of railroads, who had dominated state legislatures across the country for decades with campaign cash, bribes and other benefits. Beginning in the early 1870s, farmers flocked to the new, non-partisan Patrons of Husbandry, also known as the Grange. The agrarian social organization quickly became the focal point for anti-railroad agitation.

The Washington Evening Star took early note of the emerging crusade. “The movement of the western people against the great railroad monopolies begins to assume definite shape,” the Evening Star wrote on Feb. 20, “and it is pretty certain that the control of railroad fares and freight will be the issue on which the next legislatures in several of the western states will be chosen.”

Over the next nine months, as voters stewed about Credit Mobilier and the salary grab and demanded action to control the railroads, parties and politicians scrambled to get on the right side of the electorate.

Democrats poked Republicans for Credit Mobilier and the salary grab. Republicans scrambled to distance themselves from the scandal and the pay raise. Both parties condemned abuses by railroads and tried to align themselves with angry farmers.

Republican state platforms published in the summer of 1873 show a remarkable uniformity. Credit Mobilier and the salary grab figured in the campaign programs of Republicans in Iowa, Minnesota and Oregon. In many platforms, the phrase “Credit Mobilier” connoted not just the railroad stock scandal but any scheme of insider self-enrichment.

At the same times, the state platforms oozed with hostility toward railroads. Several called for state or federal action to support “cheap transportation” reverberated in state Republican conventions across the country as the party scrambled to get on the side of voters angry at the Iron Rail.

The New York Tribune, a leading “liberal” organ of the day opposed both to corruption and government involvement in the economy, might not have been comfortable with such proposals. But the newspaper recognized the potency of anti-railroad sentiment and urged farmers to act on their fury with the industry.

The corruption of “Railway rings and Credit Mobilier rings” hurt farmers, the Tribune argued. “We look to the Farmers, more than to any other class, to counteract the mischievous money influence which has filled our public coffers with venality and selfishness.”

By the time all the voting was done in November (many states held their elections in October), the results were clear. Democrats, often in concert with Anti-Monopolist forces, surged to power in state houses across the country or made significant inroads on Republican majorities.

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Cadwallader C. Washburn in 1861. Library of Congress.

In Ohio, Republican Gov. Edward F. Noyce fell to Democrat William Allen. Wisconsin Republican Gov. Cadwallader C. Washburn, well known for his criticism of Credit Mobilier and railroads, lost to Democrat and Granger William R. Taylor. Iowa Republican Gov. Cyrus Carpenter joined the Grange and avoided defeat but had to contend with a lower house where Democrats and Anti-Monopolists tied Republicans for control.

With the effects of the Panic becoming more pronounced each day, another issue would soon join concerns about corruption, Credit Mobilier, the salary grab and the power of railroads. “Hard times have come. There is no doubt about that,” the Chicago Tribune warned on Nov. 9. “Capitalists are nervous and wary, merchants cautious and foreboding, workingmen pinched and apprehensive, and everybody forced to retrenchment.”

The coming wave was gaining strength.

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The elections of 1873 and 1874 are covered in Congress and the King of Frauds: Corruption and the Credit Mobilier Scandal at the Dawn of the Gilded Age, available at amazon.com .

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Mendacious missives: a brief history of a political dirty trick

I recently had the opportunity to write about a long-forgotten piece of partisan mischief — the “Murchison letter” of 1888 — for the Washington Post’s Retropolis blog. It turns out that the story is not unique — far from it. Herewith, a short history of the fraudulent and forged letters that occupy a prominent — and notorious — place in the American political tradition.

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Few examples of political skulduggery have shown more staying power than the fake letter.

The inglorious tradition of the mendacious missive spans dates back to the American Revolution, flourished in the Gilded Age and played a small but significant role in the Watergate scandal.

None other than George Washington was the target of fake correspondence produced during the early years of the Revolution. As recounted by Greg Schneider in the Washington Post’s Retropolis blog, seven letters purportedly written by Washington and obtained as the Americans fled Fort Lee, N.J., suggested that the Virginian at the head of the Continental Army was deeply demoralized and regretted his part in the conflict.

In one of the letters, published in pamphlet form in London in 1777, Washington was supposed to have confessed: “I love my king.” Washington concluded that the forgeries were written by Loyalist John Randolph, a Virginian who escaped to England when the war broke out, Schneider writes.

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George Washington. Library of Congress.

Cleverly mimicking Washington’s prose style, the letters were designed to portray him as a sad and pathetic colonial, Schneider writes. The Virginian “is a very different character from what they had supposed him,” the pamphlet’s unnamed editor writes. “I never knew a man so much to be pitied.”

There is no way to know exactly what the impact of the forgeries were on public opinion in England or the colonies, but there is little evidence that they had much of an impact. Washington defended himself to friends, according to Schneider. “But with a restraint that seems very foreign today,” Schneider adds, he chose to say nothing about the letters in public until the end of his second term as president, when he issued a statement circulated to newspapers denying he was the author.

***

The Gilded Age represented a high point (or perhaps a low point) in the dark art. In 1880 and again in 1888, phony correspondence altered, or threatened to alter, the outcome of presidential elections.

It didn’t take much to swing a presidential election in the years between 1876 and 1896. Each of those six contests were decided by 3.3 percent or less in the popular vote. Two winners – Rutherford B. Hayes in 1876 and Benjamin Harrison in 1888 – carried the Electoral College even though they failed to won a majority of the popular vote.

The evenly split and deeply divided electorate was a ready made audience for forgery and other dirty tricks.

Four years after Hayes squeaked into office after winning by a single electoral vote, Republican presidential candidate James A. Garfield confronted a rude shock in the pages of a New York newspaper in what many historians call the first “October surprise.”

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James A. Garfield. Library of Congress.

A facsimile of a letter supposedly written by Garfield on congressional stationery to one H.L. Morey of Lynn, Massachusetts, plastered on the front page of the New York Truth on Oct. 23, 1880, touched on two hot topics: Chinese immigration and labor. The letter promised to faithfully adhere to the controversial 1868 treaty with China that allowed what the Office of the Historian at the State Department called “the right to free immigration and travel within the United States.”

The letter, if legitimate, was potentially explosive. The treaty was deeply unpopular in California and elsewhere in the West, where xenophobic anti-Asian sentiments ran high. Adding to the letter’s potentially explosive power, it conflated support for the deeply unpopular treaty with an obsequious regard for the interests of manufacturers. “I am not prepared to say that [the treaty] should be abrogated until our great manufacturing and corporate interests are conversed on the matter of labor.”

Garfield authorized a spokesman to deny the authenticity of the letter, biographer Alan Peskin writes, but waited several days to do so himself. Part of the reason for the delay, Peskin writes, was that Garfield couldn’t be quite sure he didn’t write the letter until an aide pored through his papers back in Washington and confirmed it was a fake.

In any event, the letter failed to pack the punch its author hoped. It was a bad forgery, with a signature that looked nothing like Garfield’s. Investigators failed to locate H.L. Morey” in Lynn or the “Employers Union” he claimed to represent.

Garfield won a narrow victory over Democrat Winfield Scott Hancock in the popular vote that was magnified in the Electoral College. California and Nevada, each carried by Republican Rutherford B. Hayes four years earlier, moved to the Democratic column in 1880.

“Except for the West Coast,” Peskin writes, Garfield “probably gained more from the episode than he lost. Even his old enemy, Charles A. Dana, advised the voters to punish Democrats for having indulged in such tactics.”

***

Eight years would elapse before the tactic made headlines again. This time, the effect was more substantial.

In September, 1888, the British ambassador to the United States received a letter from Pomona, Calif., appearing over the signature of “Charles F. Murchison.” The letter writer claimed to be an English native seeking the advice of Sir Lionel Sackville-West about the presidential campaign pitting President Grover Cleveland against Republican Benjamin Harrison.

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Grover Cleveland. Library of Congress.

Cleveland had recently taken a tough line on a fisheries dispute with Canada, the letter noted, raising the question of whether he was abandoning his pro-British inclinations. But if Cleveland were likely to return to a pro-British foreign policy after the election, “then I should have no further doubts but go ahead and vote for him,” the letter stated.

Sackville-West was an experienced diplomat who had spent enough time in Washington to understand the toxicity of being perceived as too friendly to America’s former colonial masters. He should have ignored the letter.

But he didn’t. He responded by noting the unpopularity of his government in the U.S. electorate but added that the Cleveland administration “is still desirous of maintaining friendly relations with Great Britain.”

In other words: Americans who wanted friendly ties with Britain could safely vote for Cleveland.

Alas, “Murchison” was the non de plume of one Charles Osgoodby. Over the years Osgoody’s explanations for writing the letter varied. He initially stated he simply wanted to play a prank on the British ambassador. Twenty-five years later he claimed a loftier motive — he wanted, he said, to expose the pro-British leanings of the Cleveland administration.

Whatever his motives, Osgoodby’s letter turned the campaign upside down after the correspondence appeared in the Republican Los Angeles Times on Oct. 21, 1888. Republicans seized on the correspondence in electoral vote-rich New York, a battleground state home to a sizable number of anti-British Irish immigrants.

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The front page of the New York Tribune, Nov. 4, 1888. The headline: “The British Lion’s Paw Thrust Into American Politics to Help Cleveland.”

“Means have been taken to distribute it as widely as possible and presses are being kept hot to keep up with the demand that has been made for copies of it,” according to the New York Tribune. “Thousands of copies were distributed among the vast crowds that were in and around Madison Square Garden last night.” The Tribune poured gasoline on the flames by featuring a facsimile of Sackville-West’s letter on its front page the Sunday before New York voters went to the polls.

Unlike the Morey letter, the Murchison letter may well have helped sway the outcome of the election. Harrison failed to get a majority of the popular vote, but he won in the Electoral College and carried the Empire State.

***

Fast forward to 1972. It is Feb. 26, days before the New Hampshire primary, and Democratic Sen. Edmund Muskie of Maine is quaking with rage outside offices of the Manchester Union Leader.

Loeb’s newspaper had published a front-page editorial charging that Muskie held French-speaking voters in contempt and countenanced the use of a slur — “canuck” — to describe them. The basis for the editorial was a letter from Deerfield Beach, Fla., written in what David S. Broder of The Washington Post described as “block printing that could be a child’s handwriting,” alleging that someone with the Muskie campaign had used the term “canuck” in Florida and that the senator from Maine laughed about it.

Muskie denied using or condoning the term, but what really angered him that day were attacks in the Union-Leader on his wife, Jane. His emotional defense of her honor that day became a turning point in his doomed campaign. The Democratic nomination in 1972 went to George McGovern.

The so-called “canuck letter” would have earned a place in history on its own, but later disclosures revealed that it was one of many dirty tricks developed by the Nixon White House and the Committee to Re-Elect the President. Bob Woodward and Carl Bernstein wrote on Oct.24, 1972, that law enforcement officials investigating the bugging of the Watergate offices of Democratic National Committee believed the burglary represented part of a “massive campaign of political spying and sabotage” that included the “canuck letter.”

“Law enforcement sources said that probably the best example of the sabotage [conducted by CREEP and orchestrated by the White House] was the fabrication by a White House aide — of a celebrated letter to the editor alleging that Sen. Edmund S. Muskie (D-Maine) condoned a racial slur on Americans of French-Canadian descent as ‘Canucks,’ ” the story said.

***

These episodes, involving as they do the American Revolution, the Gilded Age and the Watergate scandal, have little in common except the method used to attack an opponent. Perhaps the grand lesson here is simply this: Times — and issues — change. The dirty trick endures.

Perhaps it was my immersion in the greatest scandal of the Gilded Age — the Credit Mobilier affair — that whetted my appetite for political scandal. Check out my book — Congress and the King of Fraud: Corruption and the Credit Mobilier Scandal at the Dawn of the Gilded Age, — available at amazon.com .

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“Which of the two has changed?”

The newspaper edited by Frederick Douglass asked a pointed question in the summer of 1872.

The African-American abolitionist – and countless others – watched in astonishment and dismay as Horace Greeley, the greatest newspaperman of the nineteenth century, joined his one-time enemies to mount a long-shot presidential campaign against President Ulysses S. Grant.

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A silhouette of Horace Greeley. Library of Congress.  

Greeley’s New York Tribune did more to shape Northern public opinion in 1850s and 1860s than many politicians and any other newspaper. Through its weekly edition, which circulated widely across the Midwest and the Great Plains, the Tribune magnified its influence and became a truly national institution.

It used its enormous power to oppose the spread of slavery into the territories and support the new Republican Party. The Tribune denounced the Kansas-Nebraska Act and the doctrine of “popular sovereignty” advanced by Democratic Illinois Sen. Stephen A. Douglas. After Lincoln took office, the masthead of the Tribune declared “in a standing banner line at its masthead,” according to Greeley biographer William Harlan Hale, “NO COMPROMISE! NO CONCESSIONS TO TRAITORS!”

When Greeley published his famous open letter to President Abraham Lincoln in August 1862 urging aggressive enforcement of the Confiscation Act to free slaves and hasten the end of the rebellion, Lincoln was forced to respond – and did so, Hale notes, with a “shrewdly conceived and masterfully executed” letter of his own.

But a little more than seven years after the surrender at Appomattox, Greeley was put forward as the candidate of dissident “Liberal Republicans” and Democrats to challenge the general who had led Northern forces to victory and the party that was protecting the rights of newly freed slaves.

Douglass was appalled.

“There was a time, and that time not long ago, when Mr. Greeley had nothing in common with the Democratic party,” the New National Era noted in a July 18 editorial. “But that day has past, and the two are no longer twain, but one. Now, which of the two has changed?”

The answer was clear. It was Greeley, for whom consistency was never a watchword, who had made the biggest – and most ill-advised – political leap of his career. The Democratic platform pledged support for the post-war constitutional amendments designed to protect the citizenship and voting rights of newly freed slaves but also called for an end to Reconstruction and declared the belief that “Local self-government, with impartial suffrage, will guard the rights of all citizens more securely than any centralized power.”

With the Ku Klux Klan and other white terrorist groups on the march across the defeated South, such declarations represented either willful ignorance or indifference to the violence faced by newly freed slaves. But Greeley was not alone. A significant number of disaffected Republicans – and newspaper editors – joined forces under the “Liberal Republican” banner. Corruption and sectional reconciliation, rather than support for the political and economic rights of former slaves, were the paramount issues for men like Greeley, fellow editor Horace White of the Chicago Tribune, and Sen. Carl Schurz of Missouri.

“Fundamentally, reformers believed, Southern violence arose from the same cause as political corruption: the exclusion from office of men of ‘intelligence and culture,’” Eric Foner has written. Liberal reformers “had come to view Reconstruction as an expression of all the real and imagined evils of the Gilded Age.”

The rumpled Greeley’s quixotic campaign against Grant – in which the issue of corruption played a major role – was the backdrop against which the New York Sun published its revelations about the Credit Mobilier scandal on Sept. 4, 1872.

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The New York Sun, Sept. 4, 1872.

In a major scoop, the Sun reported that a number of prominent members of Congress bought stock in the construction subsidiary of the Union Pacific from Representative Oakes Ames of Massachusetts, a major backer of the Union Pacific. In letters written to a fellow Credit Mobilier investor (who ended up suing Ames for more shares) the Massachusetts lawmaker confided he was placing the stock with colleagues in the belief that the profitable shares would make them more likely to support the interests of the railroad on Capitol Hill.

Unlike many of the charges and counter-charges of corruption that flew through the air during the presidential campaign, the revelations published in the Sun offered legitimate and serious evidence of corruption.

Greeley’s role in the political drama surrounding the Credit Mobilier revelations was relatively small. But for one of the figures identified by the Sun it proved to be critical.

Unlike most presidential candidates of the nineteenth century, Greeley eschewed the “front-porch” approach to campaigning in which supporters would trek to a candidate’s home for a speech or other words of wisdom. He addressed rallies across New England and in Pittsburgh and Cincinnati.

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Schuyler Colfax. Library of Congress.

In Indianapolis, Greeley baited Vice President Schuyler Colfax, one of the Credit Mobilier purchasers identified by the Sun, with a call for “purification” of corruption from high places. Colfax, who as a newspaperman himself before he entered Congress wrote for the Tribune, could not ignore the challenge from his one-time mentor and responded several days later in a speech in South Bend.

It had been a difficult summer for the amiable Hoosier nicknamed “Smiler.” There had been loose talk in the spring that he might replace Grant at the top of the Republican ticket. Not only did that not take place, he was dumped as Grant’s running mate in favor of Sen. Henry Wilson of Massachusetts (also implicated by the Sun in the Credit Mobilier stock scandal). On top of everything else, his mother passed away in August.

Greeley’s comments about Credit Mobilier may have been the last straw. He vehemently denied buying Credit Mobilier stock and insisted that he didn’t need any incentives to support the construction of a transcontinental railway – “you might as well say a Methodist would have to be bribed to advocate Methodism.”

In the coming months, Colfax stuck to his denial but as the evidence against him accumulated it was seen as increasingly implausible. In February 1873, the Tribune concluded archly that if Colfax was telling the truth “he is the victim of a train of circumstantial evidence almost unparalleled in judicial history.”

By then, though, the man who provoked Colfax had been dead for two and half months. Greeley died on November 29, 1872, heartbroken at the passing of his wife and crushed by the lopsided defeat he suffered at the hands of Grant.

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The Chicago Tribune, Nov. 30 1872, with news of the death of Horace Greeley at the top of Page 1.

Greeley’s late apostasy was forgiven. New York Republican powerbroker Thurlow Weed, once an ally of Greeley’s and later a rival, served as a pallbearer, and the governors of New York, New Jersey and Connecticut attended the funeral, Hale notes.

“At noon the funeral procession formed and policemen lined the crowded streets,” Hale writes in the closing lines of his marvelous biography. “City churches rang their chimes and all business stopped as the cortege passed down Fifth Avenue, heading for Greenwood Cemetery in Brooklyn. On Madison Square the people of New York stood twenty deep to watch Horace Greeley go by. The New York Police Band played the Dead March from Saul. In the first carriage following the family mourners rode Ulysses S. Grant, President of the United States.”

– – –

Note to readers: after taking a couple of months off from the “King of Frauds” blog I’ve decided to return with a slightly different focus. I want to use this space as time permits to write about the personalities and issues involved in the Credit Mobilier scandal rather than just the scandal itself. This is the first installment. Over the coming months I expect you’ll see posts about a variety of other figures and issues. You might also see links to posts I write as an occasional contributor to the  Retropolis blog of The Washington Post. Thank you for your indulgence and interest. And don’t forget: Congress and the King of Frauds: Corruption and the Credit Mobilier Scandal is on sale at amazon.com

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Credit Mobilier and journalism, then and now

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On April 28, I was privileged to be the featured speaker at an event in Des Moines sponsored by the Iowa Freedom of Information Council. The organization promotes open records and freedom of information at the state and local level in Iowa. According to its website : “We educate citizens through speeches and training programs. We make our views known through letters to government officials, newspaper columns and appearances before committees of the Iowa Legislature.”

Below is an edited transcript of my remarks.

The defining political scandal of the Gilded Age — the biggest Washington scandal until Teapot Dome in 1924 and Watergate in 1973 — started as a newspaper story.

On September 4, 1872, the feisty New York Sun, edited by Charles A. Dana, devoted its entire front page, most of Page 2 and part of Page 3 in its four-page edition to an exposé of congressional complicity in the operations of Credit Mobilier — the lucrative construction subsidiary of the Union Pacific.

The headlines told the tale in the Sun‘s characteristically flamboyant style. At the top of the story the one-column headline read “The King of Frauds.” Provocative subheads elaborated on the theme: “colossal bribery,” “How the Credit Mobilier bought its way through Congress,” and “Congressmen who robbed the people, and now support the national robber.”

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The top of the New York Sun’s Sept. 4, 1872 expose on Credit Mobilier.

Elsewhere, the Sun promised that its story revealed what it called “the most damaging exhibition of official and private villainy ever laid bare to the gaze of the world.” As was customary in those days, the story ran without a byline, but its author – correspondent Albert M. Gibson – allowed himself to editorialize. At the top of the story he declared that while he wanted to believe that those named in the piece were innocent of wrongdoing, “there is no escaping the fact that they are guilty.”

The political drama of the Credit Mobilier scandal was many things — evidence of growing alarm at the rising influence of what was then called “money power” in state legislatures and Congress; an indication that the American romance with the railroads had cooled if not ended; and the clearest signal yet that the sectional issues that had riven the United States for decades were giving way to new concerns reflecting the emergence of an industrialized economy.

But it is fitting to be talking about this seminal event in American history to a roomful of journalists and an organization devoted to transparency in government and freedom of information. For Credit Mobilier is also a story about open government and the press when, in the words of historian Mark Wahlgren Summers, the profession of journalism was “fresh out of the eggshell.”

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The masthead of the New York Sun with its motto, “It Shines for All.” Library of Congress/Chronicling America.

Credit Mobilier was a byproduct of the federal government’s unprecedented commitment to the construction of a transcontinental railroad. The Pacific Railroad Act of 1862 chartered the Union Pacific and provided land grants and government-backed bonds to the railroad to promote construction.

Many thought the terms of the legislation to be extremely generous — indeed, some believed they were too generous. But the stockholders of the Union Pacific soon discovered the same law that provided land grants and millions of dollars in bond guarantees also made it very difficult to make it profitable to invest in the railroad.

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The law barred the railroad from selling shares below the price at which they were issued. Investors would be held liable if the railroad went bankrupt. Moreover, the railroad was being built to serve markets and communities that did not yet exist.

Not surprisingly, investors were unwilling to pour money into the enterprise. As a result, less than two years after passage of the Pacific Railroad Act, the railroad chartered by Congress was short of cash – and construction threatened to stall like McClellan at the gates of Richmond.

Union Pacific Vice President Thomas C. Durant came up with a solution. He bought a dormant railroad finance company, renamed it Credit Mobilier to borrow the glamor of a prestigious French banking house of the same name — and used it to allow Union Pacific investors to pay themselves to build the railroad. And they paid themselves handsomely.

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Rep. Oakes Ames. Library of Congress.

Credit Mobilier overcharged for construction work and took payment in Union Pacific securities. And it was enormously lucrative – according to the congressional committee that looked into Credit Mobilier’s business dealings, one construction contract earned the company almost $30 million — $513 million in 2017 purchasing power. The value of its stock soared, by one estimate, to two-and-a-half times its initial $100 share price in the winter of 1867-1868.

Credit Mobilier shares were a hot commodity that winter when one of its leading investors, a Massachusetts Republican congressman named Oakes Ames, peddled the stock to at least 11 of his colleagues at the original price of $100 per share, well below its actual value. Ames wasn’t acting out of a sense of altruism or friendship. As he conceded at the time and then again before congressional investigators, he was using the stock to magnify the influence of the Union Pacific in Congress.

Taking place long before there was anything like the financial disclosure requirements of the sort that exist today, the details of the transactions — amounts, purchasers, etc. — remained secret until the Sun published its scoop. Even then much remained unclear, due to the fact that the story was riddled with errors. Among other things, it seriously overstated and misstated the amount of stock bought by members of Congress. It characterized the transactions as “princely gifts” even though some of the lawmakers named in the story paid up front for their shares.

Something else muted – at first, anyway – the story’s impact. The Sun was an outspoken critic of the Grant administration and strong supporter of his 1872 opponent, New York Tribune editor Horace Greeley. The Sun’s overt partisanship – a characteristic of the newspapers of the age — allowed Republican papers to dismiss the story as fake news. In the words of the New York Times: “The charge originally appeared in the Sun, which is prima facie evidence that it is a lie.”

In fact, “fake news” wasn’t just a partisan smear – it was a real phenomenon. Just over two years after the Sun published its exposé, the New York Herald filled its news columns with an elaborate and sensational hoax describing the mass escape of ravenous carnivores from the Central Park Zoo and the subsequent deaths of dozens of New York residents. The story was completely fictitious.

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Henry S. McComb.Courtesy of the McComb City Railroad Depot Museum.

But the Credit Mobilier exposé managed to transcend its spotty partisan and ethical milieu. The Sun published transcripts of letters Oakes Ames had written to a fellow investor who wanted more Credit Mobilier shares. In the letters, Ames claimed that there were no shares left because he had distributed them all on Capitol Hill to win friends for the Union Pacific. In one of the letters Ames candidly discussed his motivation: “We want more friends in this Congress, & if a man will look into the law (& it is difficult to get them to do so unless they have an interest to do so,) he cannot help being convinced that we should not be interfered with.”

None of this would have come to light were it not for the Sun – which, despite its mixed motives and sloppy editing, had unearthed a genuinely alarming scoop that detailed how railroad interests used their wealth to corrupt the legislative process in Washington. The New York Tribune, which had an interest in the Credit Mobilier story because its editor was running for president against Grant, published a condensed version of the story several days later on an inside page and explained its decision in an editorial.

Demonstrating a variant of the disdain voiced by the Times, the blue-stocking Tribune explained that it published the story “with all possible reserve” – and indeed would have ignored it altogether except for one thing: “our knowledge of the fact that the letters of Mr. Ames are genuine documents.”

In other words, the Sun had the goods on Oakes Ames. Despite all its problems, the Credit Mobilier story was a legitimate scoop – and an early example of how the press can hold public officials accountable for their actions.

But the Tribune’s explanation hints at another facet of the Credit Mobilier story: the Sun’s exposé did not come as a complete surprise. Representative Cadwallader Colden Washburn of Wisconsin – on the House floor — and Charles Francis Adams Jr. – in the pages of the North American Review — had each issued separate warnings about Credit Mobilier’s spreading influence in Congress. The Sun’s scoop confirmed their worst fears.

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The New York Tribune offices. Library of Congress.

Indeed, many in the press — and the Tribune in particular – knew something was going on with the Union Pacific’s construction subsidiary. In 1868, John R. Young, the managing editor of the Tribune, warned Representative Eli Washburne – Cadwallader’s brother – about disclosures made in a New York courtroom concerning the operations of Credit Mobilier. Young warned Washburne that the litigation had exposed “an almost incredible amount of corruption” involving the Union Pacific and “especially the Credit Mobilier – affecting a good many members of Congress, the names of whom astonish.”

Young wasn’t the only member of the press who knew something was up. When Uriah Hunt Painter, a Washington correspondent for the New York Sun and Philadelphia Inquirer, learned about Ames’s stock sales, he bought thirty shares for $3,000 – and was angry because he couldn’t buy more. Ames may not have earned Painter’s gratitude, but at least he obtained his silence.

Painter’s mercenary instincts were hardly unusual in the Washington press corps of the day. William Shaw, a correspondent for the Boston Transcript, described to a congressional committee how he reacted when he learned from Treasury Secretary George Boutwell that the government was planning to withhold payment on some Union Pacific bonds.

Boutwell was puzzled by Shaw’s interest in the matter. “I have some of the bonds and stock,” Shaw explained, and if the government was planning to penalize the Union Pacific, “I would like to know it, so I can unload and get out.” In the end, Shaw managed to sell his shares before they plummeted in value – and before his readers had any idea that the government was acting against the railroad. “I always do these things,” Shaw explained, “before I let anybody else know.”

While there were plenty of Washington correspondents indulging in self-serving flimflam, others demonstrated a willingness to lift the curtain and expose malfeasance by elected officials. Henry Van Ness Boynton, the Washington correspondent of the Cincinnati Gazette and a winner of the Medal of Honor for his service at the battle of Chickamagaua, took particular delight in tweaking the dignity of Iowa’s “Christian statesman,” Senator James Harlan. Boynton wrote about Harlan’s involvement in a land swindle that deprived the Cherokees of 800,000 acres and his role in making government land available to a Union Pacific feeder line that actually ran to the east before looping back and joining the Union Pacific in Nebraska. In doing so, Boynton cut short Harlan’s political career.

Albert M. Gibson, the Sun correspondent who broke the Credit Mobilier story, was similarly interested in ferreting out the stories of corruption and malfeasance which were numerous in the nation’s capital in the years after the Civil War. Gibson was a native of Pennsylvania who broke into the business by writing for a weekly in southwestern Pennsylvania with one of the greatest newspaper names I’ve ever encountered: The Genius of Liberty. He eventually arrived in Washington and went to work for Charles A. Dana’s Sun. Boynton, Gibson and others were eager to reveal the often tawdry back stories of legislation and government policy. Credit Mobilier was a vivid example of this new instinct in the Washington press corps.

The story of Credit Mobilier in this sense exemplifies the changing role of the press in the years after the Civil War. No longer were newspapers simply partisan megaphones parroting and amplifying the positions and policies of their political allies. No longer were reporters simply self-interested shills. Newspapers and their correspondents were beginning to take seriously the role of public watchdog. To be sure there was still plenty of corrupt insider dealing and meddling in politics by newspapers and editors – Greeley’s quixotic campaign for the White House in 1872 being perhaps the most dramatic example of the latter. But it is possible in reading the coverage of Credit Mobilier to discern some of the first shoots of what blossomed into the modern adversarial relationship between the press and politicians that defines how the media holds public figures accountable.

The Credit Mobilier scandal offers another pertinent lesson for those interested in the issues of accountability and secrecy.

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Rep. Luke Potter Poland. Library of Congress.

In December 1872, the House voted to create a committee to investigate the allegations raised by the Sun and put a Vermont congressman named Luke Potter Poland in charge of the investigation.

Embodying rectitude and honor, Poland seemed the perfect choice. One observer said he reminded her of a “Methodist minister of the best type who … in some hour of weakness, backslid into the American Congress.” But he made a fateful mistake at the outset of the investigation by closing the hearings to the press and public.

Poland believed that it was the right thing to do because it would permit lawmakers and witnesses to candidly investigate the issues without fear of distractions from episodic, incomplete and inaccurate reporting by the press. Unfortunately for Poland and everybody else involved, the decision backfired.

Closing the hearings only promoted the very evils Poland said he wanted to prevent. The front pages of newspapers from Boston to San Francisco were filled with incomplete, inaccurate and sometimes contradictory information about the hearings.

For example, readers of the Tribune could be excused if they were confused about which witness the investigating committee found most credible. After railroad speculator Henry S. McComb – whose lawsuit against Ames formed the basis for the Sun’s expose – appeared before the committee, the Tribune reported that the Delaware financier made a “strong impression.” A few days later, after Ames testified, the Tribune told its readers that members of the committee said “Ames bore himself remarkably and unexpectedly well, and made a good impression.”

More seriously, the decision to close the doors of the investigation undermined public confidence. Newspaper headlines highlighted the secrecy of the proceedings. Editorial columns from across the partisan spectrum gently criticized or angrily denounced the closed-door investigation.

A notable example of press reaction on this question appeared in the editorial column of the Washington Evening Star. Newspapers in the nation’s capital were notorious for their kindly treatment of the government in general and Congress in particular. In their comical novel, The Gilded Age: A Tale of Today, Mark Twain and Charles Dudley Warner named a leading newspaper in the nation’s capital the Washington Daily Love-Feast. So it was striking when the Star noted with approval that some papers were calling the Poland committee’s inquiry the “dark-lantern investigation.” “They say more harm is likely to be done the accused parties through the sensational guessings at the evidence, and wholesale fabrications without offering any evidence at guessing, than would be by a full report of all that takes place in the committee room. And they would be right.”

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The masthead of the Washington Evening Star. Library of Congress/Chronicling America.

When the House returned from its Christmas break in January 1873, it made opening the Poland hearings to the public its first order of business. Democratic Rep. Samuel “Sunset” Cox of New York acknowledged that secrecy was at one time a common way of conducting business. “But since newspapers and telegraphs, since advancement in civilization, there has grown up a new sentiment in this country, and we should make our practice conform to it.” He concluded: “We might as well close our own doors, as shut out the public from investigations of this character.”

With Poland’s committee now conducting its investigation in the open, the public got a bird’s-eye view. Lawmakers scurried to the committee to double down on earlier denials that they had purchased Credit Mobilier shares. Ames, who had testified candidly about his motivations for selling the stock when the committee met in private, returned to Poland’s committee to offer detailed evidence of his transactions with his colleagues – showing that many of them had lied about their involvement with the stock. No one looked good, but the Poland committee reached a startling conclusion: Ames should be expelled from the House because he had tried to bribe members – but the lawmakers who bought the stock should face no punishment because they had not received a bribe.

In the end, Ames and Democrat James Brooks of New York escaped expulsion. The House voted to censure them instead. The public, which looked on as the House tried to investigate the matter behind closed doors and as lawmakers contorted themselves with increasingly implausible lies about their dealings with Ames, reacted with disgust.

In the years that followed, Credit Mobilier became a political liability because it was emblematic of sleazy insider dealings and corruption. Much of the political damage could have been avoided if, as many observed at the time, the members of Congress had simply chosen to tell the truth about their purchase of the stock. Instead, most “winced, made up pitiful martyr mouths, prevaricated, and tried to wriggle out of it,” Thomas C. Durant told the Sun.

A modern figure in American journalism expressed similar sentiments 100 years later. “The truth,” Ben Bradlee observed, “no matter how bad, is never as dangerous as a lie in the long run.”

And that brings us to the present day. The Credit Mobilier scandal shows that transparency and accountability became the twin lodestars of our profession in fits and starts. But they are our guiding principles today. Andie Dominick’s Pulitzer Prize winning editorials in the Des Moines Register — calling state officials to account for misconceptions and mistakes in health policy on questions ranging from vaccinations to insurance – offer a prime example of how this principle works.

One year earlier, Art Cullen of the Storm Lake Times was honored by the Pulitzer jury for his editorials demanding the particulars of the relationship between county officials and agricultural interests fighting a lawsuit by the Des Moines Water Works. In one of his editorials, Cullen wrote: “Regardless of your opinion about the merits of the water works’ lawsuit, the public deserves to know who is paying law firms in Des Moines and Washington, DC, and under what terms.” That idea animated the editors and correspondents who wrote about Credit Mobilier almost 150 years ago.

These editorials – and the Pulitzer-honored work of The Washington Post and New York Times regarding Russian interference in the 2016 presidential election and its connection to the Trump campaign – have one thing in common. All show how vital it is for the media, at the local, state and federal level, to hold public officials accountable. When the Post won its Pulitzer for the investigative work it did on the Roy Moore campaign in Alabama, the committee took note of what it called “purposeful and relentless reporting that changed the course of a Senate race.”

The Pulitzer committee commented on another aspect of the story: how the paper handled what Pulitzer called “the subsequent effort to undermine the journalism” that exposed it. The Post did that by lifting the curtain on efforts to concoct a false narrative that the reporting was driven by some kind of ideological agenda.

There can be no doubt that there is a widespread and mistaken belief today that our work has some kind of underlying partisan motive. We have to be on guard to avoid even the appearance of bias – and push back when falsely accused of it. Our business has come a long way from the half-partisan, half-professional era of the Gilded Age. Readers are more sophisticated – and cynical. If we are to hold public officials to the highest standards of accountability and openness, we must be willing to live by those standards ourselves.

“Sunset” Cox noted in the age of the telegraph and the steam engine that the “advancement of civilization” required openness and transparency in government. Today, in the age of the internet, the need for the media to hold those in power to account – and conduct itself by the highest principles of our profession — is even greater.

 

Thanks again to Randy Evans and my friends at the Iowa Freedom of Information Council. Congress and the King of Frauds: Corruption and the Credit Mobilier Scandal at the Dawn of the Gilded Age is available at amazon.com

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The “King of Frauds,” 21st-century style

It occurred to me not long ago that it might be a worthwhile exercise to try and write the New York Sun’s Credit Mobilier scoop in the style of a modern news story. The premise is that the story is being written several days after the Sun story was published on Sept. 4, 1872.

A couple of points to keep in mind:

1) For the most part I’ve worked with the facts as they were known (or could have been known based on the Congressional Globe) in the days after Sept. 4. That means this story does not have the full extent of James Brooks’s Credit Mobilier holdings or references to Reps. John Logan and William Boyd Allison, whose involvement became known as the Poland committee investigation unfolded.

2) The piece includes denials by Ames and others issued in the days and weeks following the story. Modern journalism requires that the principals in a story of this kind be offered the chance to respond. But because evidence that contradicted their claims of innocence did not emerge for several months, the denials go unchallenged. I have also closed the piece with an assessment of the disclosures by the New York Tribune published Sept. 7.

My conclusion: stripped of its sensational Gilded Age-era headlines and editorializing, the story holds up — although, as the New York Tribune noted, “further developments” would in the end shape public opinion about the story and subsequent scandal.

***

“We want more friends in this Congress”: Lawmaker peddles stock to colleagues to aid Union Pacific

A Massachusetts lawmaker and railroad financier told a business associate that he sold stock in a Union Pacific construction subsidiary to congressional colleagues to win allies for the railroad on Capitol Hill.

In at least three instances, members who bought stock in the company introduced or voted on legislation that affected the interests of the Union Pacific, the railroad chartered by Congress in 1862 as part of the Pacific Railroad Act.

Rep. Oakes Ames, R-Mass., detailed his motivation for selling shares in the construction company – Credit Mobilier – in letters written in early 1868 to Henry S. McComb, like Ames a major investor in the Union Pacific and its profitable subsidiary. McComb is suing Ames to obtain more shares of Credit Mobilier.

“We want more friends in this Congress, & if a man will look into the law (and it is difficult to get them to do so unless they have an interest to do so) he cannot help being convinced we should not beh interfered with,” Ames wrote in one letter.

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Rep. Oakes Ames. Library of Congress.

Ames explained in another letter that he had no Credit Mobilier stock to spare after distributing it to magnify the railroad’s interests on Capitol Hill. “I have used this,” he said, referring to the stock, “where it will produce most good to us, I think.”

In deposition testimony, McComb submitted a list he compiled of lawmakers Ames said he approached about buying shares of Credit Mobilier. The list includes Vice President Schuyler Colfax of Indiana, then speaker of the House; Sen. Henry Wilson of Massachusetts, nominated by Republicans in June to succeed Colfax; House Speaker James G. Blaine, Colfax’s successor; William D. Kelley of Pennsylvania; and Treasury Secretary George Boutwell, then a Republican congressman from Massachusetts.

Others identified by McComb as purchasers of Credit Mobilier stock include Reps. James A. Garfield and John Bingham of Ohio and Rep. Henry Dawes of Massachusetts.

McComb also testified that Rep. James Brooks, D-N.Y., obtained Credit Mobilier stock in exchange for promising to promote the interests of the Union Pacific among Democratic lawmakers.

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Henry S. McComb. McComb City Railroad Depot Museum.

Many of the lawmakers and former members of Congress on the list have denied buying Credit Mobilier stock or engaging in inappropriate conduct. Brooks declined to comment directly, but the New York newspaper he owns and edits has assailed the credibility of McComb.

In a statement, Ames stopped short of denying that he sold shares to his colleagues while asserting that he gave nothing away. He did not attempt to bribe members, he said, and believes his conduct with respect to the Union Pacific and the construction of the transcontinental railroad is beyond reproach.

“I may have done wrong in my efforts to aid this great national enterprise,” he said, but “I am unconscious of it.”

Campaigning in Maine, Blaine told local newspapers he has never owned stock in Credit Mobilier. Colfax also denied ever owning Credit Mobilier stock and there was no reason to offer him a bribe for support the interests of the Union Pacific. He has a long record of support for the transcontinental railroad, he said, and “you might as well say that a Methodist would have to be bribed to advocate Methodism.” Colfax’s successor on the Republican ticket, Sen. Henry Wilson of Massachusetts, likewise denied ever owning Credit Mobilier stock.

In a brief statement, Garfield said he “never subscribed to a single share” of Credit Mobilier and “never received or saw a share of it.” Kelley, a Republican from Philadelphia known as “Pig Iron” for his passionate defense of iron tariffs, also denied owning the stock. “I have never owned a share of stock in the Credit Mobilier of America, nor has any member of my family, either directly or by the trustee of an agent.”

The allegations, first published by the New York Sun on Sept. 4, come as it appears increasingly likely that President Ulysses S. Grant will win re-election over his Democratic opponent, former New York Tribune editor Horace Greeley.

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Schuyler Colfax. Library of Congress.

Nevertheless, they have the potential to upend the political status quo as a growing number of farmers and merchants are mobilizing to fight what they believe is the political and economic abuses of monopoly power of the railroad industry.

Credit Mobilier was the brainchild of former Union Pacific Vice President Thomas C. Durant, who bought the charter of a Pennsylvania railroad finance company in 1864 and renamed the business after the French banking house, Credit Mobilier.

Although nominally a construction business, Credit Mobilier plays a significant role in Union Pacific finances. Its major stockholders are also big shareholders in the Union Pacific. The company takes payment in Union Pacific stocks and bonds and essentially allows Union Pacific investors to pay themselves to build the railroad.

The arrangement is not uncommon in the industry but alarms critics who say it is inappropriate for an enterprise chartered by Congress and supported with federal land grants and government-backed bonds.

McComb, in his deposition testimony, characterized Credit Mobilier as the “inside ring” of the Pacific Railroad, but he has been an active investor in the company. When Durant and Ames divvied up un-allocated Credit Mobilier shares in late 1867, McComb demanded that Ames provide him with some of the stock.

Ames rebuffed McComb’s demands and the Delaware railroad investor filed suit against the Massachusetts congressman and Credit Mobilier in November 1868 to press his claim.

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Rep. James A. Garfield. Library of Congress.

As McComb pressed his claim for Credit Mobilier stock, some members of Congress have criticized the company and warned that its parent — the Union Pacific — would gain too much influence in Congress.

In a March 1868 speech on the House floor, Rep. Cadwallader Colden Washburn, R-Wis., denounced Credit Mobilier’s close ties to the Union Pacific for enabling fraud.

The Union Pacific, Washburn charged, “practically contracted with itself to build the road, and that the enormous figures they exhibit as representing the cost of building the railroad are absolutely fictitious.”

Urging Congress to regulate the railroad it had chartered, Rep. Charles Van Wyck, R-N.Y., warned in May 1868 that lawmakers would soon find themselves in the same position as legislators in Albany — powerless to control the Union Pacific at all unless they acted.

“The Central Railroad in New York controls that state and buys up its Legislature year after year, so as to increase its tariff on passengers,” Van Wyck warned his colleagues. Referring to the Union Pacific, he added: “You ask us to wait until we get both our hands within the jaws of this lion, when we will be powerless to control it.”

One of the few lawmakers named by McComb who did not deny buying Credit Mobilier stock went to bat for his Massachusetts colleague months after Ames and Thomas C. Durant, then vice president of the Union Pacific, settled a bitter feud over control of the Union Pacific board and Credit Mobilier. Rep. Henry Dawes said he “never owned a dollar of any stock or any property of any kind that I did not pay the full value of, with my own money, earned with my own labor.”

In December 1867, Dawes introduced legislation that would have allowed the railroad to move its corporate headquarters out of New York – and away from the judges, lawyers and Wall Street speculators allied with Durant.

As he introduced the measure, Dawes conceded he was acting on behalf of railroad stockholders who had asked for help. He did not identify on whose behalf he was acting.

But Brooks, himself a Credit Mobilier stockholder according to McComb, alluded to the just-concluded corporate war when he urged lawmakers not to act too hastily. “Behind the proposition now is a private quarrel,” Brooks told his colleagues. Referring to the Dawes bill, Brooks added: “It is full of meaning; and the House will discover it to be so.”

Dawes’ measure became law but the railroad did not take advantage of the opportunity to relocate its corporate headquarters – a failure that set the stage for another crisis requiring additional legislative assistance.

In the meantime, Credit Mobilier stockholders lined up to keep a proposal by Washburn to create a three-member board to regulate Union Pacific passenger and freight rates from coming up for a vote. Brooks, Bingham, Rep. Glenni Scofield, Rep. William D. “Pig Iron” Kelley and Ames joined those voting Feb. 17, 1868 to block a vote on the Washburn bill. The House voted 73-65 against debating the Washburn bill.

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Rep. Cadwallader C. Washburn. Library of Congress.

Just over two years later, the Union Pacific needed more congressional help. In New York, where the railroad’s headquarters remained despite Dawes’ efforts, Wall Street speculator James “Jubilee Jim” Fisk, who owned a handful of Union Pacific shares, sued the railroad claiming he was entitled to additional stock.

The presiding judge in the case, George Barnard, played poker with Fisk and was allied with the Democratic Tammany Hall machine. He ordered the Union Pacific to halt the election of a board of directors and then sent sheriff’s deputies to arrest railroad officials when the election went ahead.

He later put the railroad into receivership and dispatched William Marcy Tweed Jr., the son of Tammany’s leader, to recover documents from the railroad’s offices. Tweed ultimately had to break into the corporate safe to obtain the documents.

While the railroad contended with Tweed, it also had to fend off claims to more than $1 million in bonds made by the Central Pacific for construction costs incurred by the Union Pacific. Over the protests of the Union Pacific, Treasury Secretary Hugh McCullough awarded the bonds to the California-based railroad.

In March 1869, Credit Mobilier stockholder John Bingham came to the railroad’s aid with two pieces of legislation. One ordered the railroad to relocate its headquarters to Boston and removed Fisk’s lawsuit from Barnard’s jurisdiction. A second measure ordered an in investigation by the the Pacific Railroad Committee into the bond question.

The bills easily passed the House but encountered opposition in the Senate. Sen. William Stewart, R-Nev., defended the Central Pacific’s claim to the bond revenue and wondered why the Union Pacific was so eager to get the Fisk case out of Barnard’s courtroom.

“A great deal has been said against Judge Barnard, but what great sin has he committed in this case?” Stewart asked.

In the end Congress brokered a compromise under which the Central Pacific would pay the Union Pacific to build the final stretch of the road to Promontory Point, where the two railroads joined. The legislation also ordered a new board election to be held in Boston, from from Barnard’s jurisdiction.

Bingham declined to comment about his role in the legislation.

The long-forgotten legislative maneuvering by lawmakers who owned Credit Mobilier stock takes on renewed significance as concern about the political influence of railroads in Congress and state legislatures reaches new heights.

Farmers throughout the Old Northwest and South are flocking to a nominally apolitical organization known as the Patrons of Husbandry as a means of opposing what they see as the unchecked economic and political power of railroads.

The New York Tribune has taken a reserved approach to the allegations but notes that they are potentially explosive. “The public,” the Tribune says, “will look with deep interest at further developments in the case.”

“Responding to their demand for reform”

Six months after Congress tried to close the books on the Credit Mobilier scandal, voters got the chance to weigh in.

We complain about non-stop campaigning in the era of cable television and social media, but in the days of the telegraph and steam engine it seemed as if voters were perpetually trekking to the polls. They had gone to the ballot box the previous fall in the presidential election and would return in mid-term elections in 1874.

Today, only New Jersey and Virginia hold state elections in odd-numbered years. In 1873, sixteen states held elections for statewide office and state legislatures.

The balloting that year offered the first test of voter anger over the scandal created by revelations of insider sweetheart stock sales involving members of Congress and Credit Mobilier, the hugely profitable – and controversial – construction subsidiary of the Union Pacific.

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James A. Garfield. Library of Congress.

Voters had other things on their mind too — fury over a last-minute retroactive pay increase that became quickly notorious as the “salary grab;” rising anger over the political and monopoly economic power of railroads; and alarm caused by a Wall Street panic whose impact was just beginning to be understood in the late summer and early autumn of 1873.

Much was at stake as voters from Maine to Oregon went to the polls. Before passage of the Seventeenth Amendment, state legislatures – not the voters – elected U.S. senators, giving otherwise local races national implications as a result.

During the summer, Republican platforms roundly denounced the Credit Mobilier scandal as the party attempted to get ahead of a story on which most of the leading figures came from the party of Lincoln. In terms very similar to those used by their partisan brethren in Iowa, Ohio, and Oregon, Minnesota Republicans denounced “all Credit Mobilier transactions, whatever be their form.”

The language is significant because it suggests party regulars were worried not only about Credit Mobilier but any suggestion of insider impropriety by lawmakers — especially if railroads were involved. Credit Mobilier had become a synonym for the nefarious influence of what Luke Potter Poland had called “great money power” in politics as the House debated the fate of Oakes Ames and James Brooks.

“Of the Credit Mobilier matter,” Ohio Republican Gov. Edward F. Noyes declared as he ran for re-election, “it is only necessary to say it was an unmitigated swindle of the government, without excuse or palliation.”

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A cartoon from March, 1873 shows “Brother Jonathan” talking to an eagle injured by, among other things, Credit Mobilier “and general dishonesty.” Library of Congress.

The vigor of Noyes’s denunciation points to another factor shaping the politics of 1873. Across the Midwest and the South, farmers furious with the monopoly economic power of railroads had mobilized to get relief from their state legislators and Congress. They turned to an ostensibly apolitical organization — the Patrons of Husbandry, known more informally as the Grange — to take on the Iron Rail.

“The movement of the western people against the great railroad monopolies begins to assume definite shape,” the Washington Evening Star noted in an editorial. The newspaper added: “it is pretty certain that the control of railroad fares and freight rates will be the issue on which the next legislatures of several western states will be chosen.”

The combustible political environment elicited varying responses. In northeastern Ohio, Rep. James Garfield — not only implicated in the Credit Mobilier scandal but tied to the salary grab as the sponsor of the appropriations bill to which the bill was attached — acted nimbly to respond.

Addressing Credit Mobilier, he published a monograph laying out in great detail his insistence that he was innocent of any wrongdoing. On the salary grab, he returned his raise. Both moves helped disarm critics.

In Iowa, Gov. Cyrus Carpenter joined the Grange and the state party platform urged state and federal legislation to ensure cheap transportation. Republicans in Columbiana County, Ohio, warned legislators against voting for any Senate candidates linked to Credit Mobilier or the salary grab.

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Cadwallader Colden Washburn in 1860. Library of Congress.

Wisconsin Gov. Cadwallader Colden Washburn could be pardoned if he thought his record as a critic of Credit Mobilier and an advocate of railroad regulation provided some cover. But Democrats joined forces with anti-Monopolist forces and nominated Granger William R. Taylor to give Washburn an unexpectedly tough challenge.

The highly charged atmosphere of the early 1870s made for strange bedfellows. Farmers who favored state regulation of railroads and free-market liberal reformers (we would call them conservatives today) formed a temporary alliance. The New York Tribune gave voice to this sentiment when it urged farmers reluctant to get involved in politics to enter the fray. “We look to the Farmers, more than to any other class, to counteract the mischievous money influence which has filled our public offices with venality and selfishness.”

When the returns were counted, the public’s state of mind became clear. Voters were furious about Credit Mobilier, back-door pay raises, corruption, and the monopoly power of railroads. Noyes was narrowly defeated in Ohio and Washburn fell to Taylor in Wisconsin. Carpenter was re-elected but Iowa Republicans had to share control of the lower house of the legislature with a coalition of anti-Monopolist agrarians and Democrats.

In Washington, the implications were clear. “The ‘off-year and its results has made many a Congressman to feel the possibility, if not the probability, of his early retirement to public life,” the National Republican wrote on Dec. 1. Any member of Congress “who entertains such a fear will endeavor to place himself before his constituents in the attitude of responding to their demand for reform.”

 

I will be at Common Good Books in St. Paul, Minn., at 7 p.m. April 27 to talk about Congress and the King of Frauds: Corruption and the Credit Mobilier Scandal at the Dawn of the Gilded Age.” If you can’t make it, find the book at amazon.com

 

“Smiler,” “Pig-Iron,” “Hoax,” “The Napoleon of Railways” and “Spoons”

We don’t do nicknames anymore – at least not the way they were tossed about 150 years ago. More’s the pity.

Part of the fun of writing Congress and the King of Frauds was reveling in the rich store of colorful characterizations of the leading figures in the Credit Mobilier scandal.

In an earlier post I’ve written about my love for the political language of the period. This extends to the way in which reporters, editors and authors described leading politicians and financiers of the day.

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The New York Sun.

The cast of characters in Credit Mobilier is rich with vivid Gilded Age personalities. Some were rascals and rogues; others were politicians in way over their head. Writers lampooned their vanity, pretensions and limitations, often with withering effect.

Herewith, a sample of memorable nicknames, characterizations and zingers:

“Smiler” Schuyler Colfax: The vice president and former House speaker was an amiable black-slapper from Indiana. “Smiler” connoted both his easygoing personality and lack of gravitas.

Colfax ensnared himself in the Credit Mobilier scandal by denying he had ever bought shares from Oakes Ames and compounded his difficulties by offering ever-more convoluted explanations. After a particularly unconvincing appearance before the lead House committee investigating the scandal, The Nation concluded that Colfax’s testimony exemplified answers “that make a thing appear worse than it really is.”

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Schuyler Colfax. Library of Congress

The New York Herald attempted (perhaps not successfully) to immortalize Colfax’s Credit Mobilier dilemma in verse:

“A beautiful Smiler came into our midst,

Too lively and fair to remain;

They stretched him on racks till the soul of Colfax

Flapped up into Heaven again.

May the fate of poor Schuyler warn men of a Smiler

Who gets dividends on the brain!”

Oakes “Hoax” Ames, a k a “The King of Spades:” Perhaps fittingly, the central character in the story of the Credit Mobilier scandal had two nicknames, one less flattering than the other. The Herald dubbed him “Hoax” Ames, and other Democratic papers followed suit.

The versifying Herald summed up Ames thusly:

“Thou toldst the truth, though hid ‘neath many cloaks

“O concentrated essence of a Hoax.”

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Rep. Oakes Ames from “Behind the Scenes in Washington.”

But the amusingly snarky nickname is actually unfair — Ames “remorselessly told the truth, to his own terrible damage and the ruin of his timid accomplices,” according to the New York Tribune.

Ames’s other nickname was more flattering. He and his brother were each known as “the King of Spades” as the heirs to the hugely successful shovel-making business started by their father in North Easton, Mass. In the years before the Civil War, one admirer of Ames would write years later, “the Ames shovel was legal tender in every part of the Mississippi Valley.” The New York Sun likely played off Ames’s royal nickname with its Credit Mobilier headline, “The King of Frauds.”

 

William D. “Pig-Iron” Kelley: A Radical Republican from Philadelphia who would align himself with the insurgent Greenback-Labor Party in the late 1870s, Kelley was known as “Pig-Iron” because of advocacy of iron tariffs. But it wasn’t his position on the issue that grated critics — it was his rhetorical excesses. The Chicago Tribune took a particular dislike to Kelley and mocked him at every opportunity — especially as the decade of the 1870s advanced and the question of paper money versus hard money began to dominate politics.

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William D. “Pig Iron” Kelley. Library of Congress.

Kelley’s low point during the investigation into Credit Mobilier came when he challenged Ames’s claim that he had agreed to take ten shares paid for with the the profits from dividends and rising stock prices. After pressing Ames on the details of the sale, Kelley —  assuming he had the King of Spades right where he wanted him — asked him when he could hand over the stock certificates.

“I am ready to deliver them now,” Ames responded as he pulled the shares from his coat pocket. The flummoxed Kelley, for once, was rendered speechless.

“Kelley was once a Democrat of the same intense stupidity that now distinguishes him as a Republican,” the Tribune declared in 1870, two years before the Credit Mobilier scandal erupted. “The mule has got over the fence, but the anatomy is still the same.”

Thomas C. Durant, the “Napoleon of Railways:” The larger-than-life Union Pacific vice president, creator of Credit Mobilier and corporate rival of Oakes Ames engendered admiration or fury — and sometimes both — among those with whom he dealt. Trained as a physician, he gravitated to the high-stakes world of railroad finance as a young man and never looked back. In 1866, the Omaha Herald dubbed him “the Napoleon of Railways” after Union Pacific workers laid 1.75 miles of track in a day, setting a record.

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“Jupiter,” the train that carried Leland Stanford of the Central Pacific to the Golden Spike ceremony in the Utah Territory in 1869.

There may been more to the moniker than uncritical adulation. In their History of Nebraska, published in 1918, J. Sterling Morton and Albert Watkins note that vanity is a common weakness among “men of unusually strong qualities or characteristics.” Durant, widely mistrusted in Omaha, “was not an exception to this rule,” they wrote, and the Herald buttered him up relentlessly to keep him favorably disposed toward the Union Pacific’s home town. The newspaper “in season and out of season,” Morton and Watkins wrote, “fortified its faith by cajolery of the imperious arbiter of Omaha’s fortunes.”

Henry S. McComb, a k a “Subtle:” The railroad speculator who sued Oakes Ames to obtain more Credit Mobilier stock — and thus set in motion the events that led to the exposure of Ames’s transactions with members of Congress — cultivated the refined air of a Southern man of means. But beneath the genteel veneer was a ruthless passion for money, journalist George Alfred Townsend wrote in 1882.  McComb was secretive, litigious, “jealous of money and belligerent when deprived of his share of it,” according to Townsend.

McComb made his mark in Mississippi, where he took control of local railroads and built the town in the southern part of the state that bears his name.

But McComb’s ambitions exceeded his finances. He joined forces with the Illinois Central, only to fall deeply in debt to his new partners. Examiners who studied the condition of his railroad operations found deteriorating equipment, unpaid workers, and a payroll brimming with lobbyists and lawyers. Illinois Central employees communicating with corporate offices in Chicago over telegraph lines along McComb’s railroad took the precaution of referring to him by the code name “Subtle.”

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Benjamin Butler in uniform. Library of Congress.

Benjamin “Spoons” Butler: The Radical Republican earned his nickname in the Civil War for his alleged habit of pilfering silver tableware from Confederate households. The nickname remained popular among Democratic and Southern newspapers when Butler led efforts to defend Ames against expulsion from the House for his role in the Credit Mobilier scandal. In 1880, when he was touted as a possible candidate for the Greenback-Labor Party’s presidential nomination, Southern delegates to the third party’s Chicago convention hooted him down by yelling “Spoons.”

Although it connotes chicanery, the nickname hardly seems adequate to the task of describing one of the most colorful and interesting characters in the Credit Mobilier saga. Butler was “a clever lawyer and shrewd politician whose paunchy physique, balding head, drooping mustache and cocked left eye gave him a shifty appearance,” James McPherson writes in Battle Cry of Freedom. In Congress, Butler strutted like “a bass walking on its tail,” one observer wrote — and on top of everything else, he cultivated a dramatic air on the House floor, accentuated by his habit of wearing capes.

“General Butler was not eloquent, but he was savage – as savage as a meat-ax,” Republican Julius Burrows of Michigan recalled at Butler’s passing in 1893. “He was like a volcano – always smoking and always giving a hint of a pending eruption.”

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George Alfred Townsend. Library of Congress.

George Alfred Townsend, a k a “Gath:” Bylines were not yet commonplace in the 1870s, but some newspaper correspondents adopted pen names — often derived from classical literature or Scripture.

A minister’s son, Townsend added an “h” to his initials to employ the pen name “Gath” as he covered the Civil War. The non de plume took on added significance after Appomattox, when Townsend turned his attention to the nation’s capital. Gath was a Philistine stronghold brought to ruin when the Israelites brought the Ark of the God of Israel into the city.

 

—-

I will be talking about the Credit Mobilier scandal at Common Good Books in St. Paul, Minn., at 7 p.m. on April 27. If you can’t make it, Congress and the King of Frauds: Corruption and the Credit Mobilier Scandal at the Dawn of the Gilded Age is available at amazon.com

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