The Gilded Age

The Gilded Age

Organizing principle - The Gilded Age fostered the consolidation and centralization of business, the government, and disadvantaged economic and social classes.

I. Grant - politics and scandals

A. election of 1868 Republicans nominate the hero of the Union Grant

1. had limited qualification - expected that it was his rightful reward

2. Grant clubs organized to show appreciation

a. he was given a house and $105,000

b. accepted them without hesitation believing they were his just rewards

3. Grant was probably never a threat to become a military dictator - doesn’t seem to have that type of aspiration - also seems to lack the energy

4.. campaign slogan was “Let us have peace.” - grafters saw it as “let us have a piece”

5. platform

a. support for the gold standard - sound money - Republican party is the party of big business

b. continued Radical Reconstruction - though Grant seems to be unwilling to oversee the operation

3. waving the bloody shirt (Benjamin Butler speech) was the primary strategy

G. Democrats nominate Horatio Seymour

1. favor the “Ohio Idea” - retiring war bonds by the reissuing of greenbacks rather than paying them off only in gold as the Republicans favored - Seymour repudiates this plank of the platform

2. also favor the end of Reconstruction - meant placing Democrats back in control of state governments

H. outcome - Grant 214 - 80 EV - 3.0m - 2.7m PV

1. note the closeness of the election despite the fact that a Republican military hero is the candidate

2. Grant won by 300,000 PV - 500,000 Blacks had voted - thus it appeared essential that Reconstruction be continued

I. “the era of good stealings”

1. Grant administration (indeed government generally) was characterized by the loose morality that Morison contends always follows a great war

2. Grant was apparently not directly involved in the scandals but insists on staunchly defending his appointees and friends

3. Fisk and Gold bribed one legislator with $100,000 after he had already taken $75,000 from their rival - led to the definition - “An honest politician is one who, when bought, stays bought.”

4. the basis for being selected to Grant’s cabinet was largely whether or not one had helped Grant through one of the clubs which brought him material benefits

5. one notable exception is Secretary of State Hamilton Fish

J. cornering the gold market

1. Fisk and Gould determine to hoard gold and sell when the price gets high enough

2. they need the complicity of Treasury Department officials to guarantee that the government won’t attempt to maintain a fixed price (government generally bought or sold gold to maintain a consistent price level

3. Black Friday - 9-24-69 scheme begins as the price of gold rises dramatically

4. Treasury Department forced to dump gold and the plan fizzles only after Fisk and Gould have made a killing

K. Santa Domingo annexation schemes fall through UPGRADE

L. Tweed Ring in New York City - classic boss rule and corruption

1. estimated that between $50-200m was stolen from the city government

2. recorded bill of $130 m to a plasterer for two days work

3. taxes used as a weapon to cower opponents into submission

4. Samuel Tilden makes a name for himself prosecuting the Tweed Ring

5. Thomas Nast (political cartoonist) helps break the ring - Boss Tweed is said to have remarked “Them damn pictures.” - more effective with illiterate population

M. the Credit Moblier Scandal

1. designed to set up a dummy company to siphon off profits of transcontinental railroad construction

2. fears of discovery led to the bribing of Congressmen, Senators, and Cabinet officers

3. one of those who made millions was Leland Stanford who later established Stanford University

N. the Whiskey Ring - Treasury Department officials took bribes to avoid collecting excise taxes

O. War Department

1. Belknap Scandal - selling supplies earmarked for Indians for favors

2. Sanborn Contracts - right to trade with Indians awarded by the War Department

P. the Salary Grab - doubled the salary of the President and increased congressional salaries by 50% retroactively

O. indirectly these scandals led to the drive for civil service reform - do a degree they may also reflect the typical self-destruction of dominant parties.

II. Foreign affairs

A. a scheme to annex Santa Domingo for the assumption of it debts fell through

1. American people were lukewarm to the idea

2. concern seems to be shifting from expansion to development

B. beginnings of consistent problems with Spain over Cuba

1. 1873 several American gun-runners executed -Virginius Affair

2. Cuba seems in a state of almost continual rebellion

C. Maximillian’s plot in Mexico

1. French plot to establish Maximilian as a puppet government in Mexico

2. a way of circumventing the Monroe Doctrine

3. the French eventually abandon Maximilian after the Civil War

4. U.S. military mobilization and French financial losses probably combine to end it

D. Fenian uprising

1. feeble attempt of ex-Union Irish military men to invade Canada and hold it hostage for Ireland’s freedom

2. the British North American Act establishes commonwealth status for Canada

E. the Alabama Claims

1. Confederate blockade breakers had been constructed in British ports

2. their building constituted an unneutral act - they preyed on Union commercial traffic

3. the U.S. present claims for damages and the British agree to arbitration because they don’t want the same tactic used on them

4. Senator Sumner demands $15m in direct damages and $2b in indirect damages for prolonging the war

5. The Treaty of Washington 1871 agrees to an arbitrated settlement

6. Geneva Agreement settles claims for $15.5m

7. Bailey contends that the British foreign office hung the canceled check on their wall as a reminder of a serious policy lapse

III. the 1870s and the currency controversy

A. liberal Republican look to replace Grant (Carl Schurz and Bratz Brown)

1. they hold a separate convention and nominate Horace Greeley

2. Democrats decide to support Greeley as well

B. Republican insiders like Grant because he is easily manageable

C. the campaign is very nasty and personal

1. Greeley characterized as “an atheist, communist, free lovers, vegetarian, a brown bread eater, an idiot, a co-signer of Jefferson Davis’ bail bond”

2. Grant characterized as “a dictator, a loafer, a swindler, an ignoramus, a drunkard, an utterly depraved horse jockey”

3. results Grant - 286 - 3.59m - Greeley 66 - 2.8m

4. within a month after the election Greeley loses his wife, his job, his mind, and his life

5. the effect of this liberal revolt caused some house cleaning if only to avoid wholesale civil service reform - politicians know you can only get away with being so crooked

6. the liberal revolt also demonstrates the typical third party role in American politics - to win enough votes to influence one of the major parties

D. the Panic of 1873 - most severe to that date

1. more than five hundred businesses fail

2. typical causes of overspeculation - Morison claims it is a typical post-war depression

3. it is broadly tied to the currency controversy

E. currency issues - two major concerns

1. tight or loose money policy

2. whether to pay off war bonds in gold or greenbacks

F. eventually these merge to the single issue of bi-metalism or the gold standard

1. farmers and debtors favor currency inflation - the printing of greenbacks (later the coining of silver) so that money is easier to get, even if its value is not as great

2. businesses and creditors tended to favor a stable currency so that the relative value of currency remains constant over time

G. 1870-71- Legal Tender Cases

1. Supreme Court first rules that the Legal Tender Acts requiring the acceptance of greenbacks in payment of debt are unconstitutional

2. later and enlarged court (9 rather than 7) upholds their constitutionality

H. through the buying and selling of gold and silver the government attempted to maintain the consistent ratio of 16-1 (ounces of sliver to ounces of gold)

1. shortages of silver meant that silver was worth more on the open market than the 16-1

2. thus in 1873 the government stopped coining silver dollars

3. shortly after the decision, new strikes of silver lowered the price

a. mining interests are going to favor the recoining of dollar

b. debtor and farm interests favor the same as a means of currency inflation

c.  business favors maintaining the gold standard because the value of currency will remain more stable

4. government decision is known as the “Crime of ‘73” by debtor classes

I. 1875 - Resumption Act - stated that in 1879 the government would begin redeeming Greenbacks for gold

(had been suspended during the Panic of 1873 and more Greenbacks had been printed)

1. government prepared for the rush by amassing $100m in gold reserves

2. the anticipated run never developed - why

a. economic recovery

b. confidence restored

c. Greenbacks were more convenient

J. 1878 - Bland-Allison act

1. called for the government to purchase and coin $2-4m worth of silver per month

2. government always bought the minimum amount - thus little relief for debtors

3. continued strikes led to further price decreases and the value of silver in a dollar fell to 93 cents

4. some expansion of currency in circulation was necessary in the period

5. 1870-1880 per capita money in circulation fell from $19.42 to $19.37 - this despite population increases - what does that mean

K. tariff policy - during the war tariffs had been kept high - would Republicans tend to favor high tariffs? - why?

1. 1872 tariffs revised downward from high wartime levels (-10%)

2. Panic of 1873 is blamed - Western interests demand lower tariffs

3. increased again in 1875

L. election of 1876

1. Republicans Grant is interested in a third term but the House passes a resolution warning him of dictator ambitions - two term precedent is strong

2. major Republican candidate is James G. Blaine - but he is tinted by the Mulligan letters

3. Republicans settle on the dark horse candidate Rutherford B. Hayes

4. platform provisions

a. permanent pacification

b. sound money

c. civil service reform

5. Democrats settle on Samuel Tilden - lawyer who helped smash the Tweed Ring

6. he has some machine and robber baron ties

7. the impact of the “bloody shirt” - Robert Ingersoll - “Every man that shot a Union soldier was a Democrat. The man that assassinated Lincoln was a Democrat. Soldiers, every scar you have on your heroic body was given you by a Democrat.”

8. results - Hayes 4.0m - 165 - Tilden 4.3m - 184

9. four states in doubt - Oregon, Louisiana, South Carolina, Florida

10. Tilden needed only one of the twenty electoral votes in question to be elected

11. “visiting statesmen” from both parties visit all states in question

12. each state submits two sets of electoral ballots

13. electoral commission is established to be made up of fifteen members - five each from the House, Senate, and Supreme Court

14. seven Democrats, seven Republicans, and Justice Davis - considered to be neutral

15. Davis resigns and the only remaining members of the Supreme Court are Republicans

16. initial vote finds for Hayes in each state - 8-7 in every case

17. Democrats threaten a filibuster - danger of not having an elected President

18. The Compromise of 1877

a. Hayes take office

b. Republicans agree to withdraw federal troops from the South

1. end military Reconstruction

2. allow Democratic governments to take over from Republican ones

c.  federally funded internal improvements for the South - especially designed to overcome war

damage

d. Republicans promise at least one Southern cabinet member with patronage at his disposal

e. unofficial acceptance of non-enforcement of the 14th and 15th Amendments

19. thus Hayes is seated - “old 8-7”, “his fraudulency”
20. known as the “cold water” administration because “Lemonade Lucy” refused to serve alcohol at state functions

M. Hayes actually makes a pretty decent President

1. Reconstruction is ended (largely because the North was tired of it)

2. ironically, Tilden probably could not have ended Reconstruction

3. mild civil service reform occurs - “He serves his party best who serves his country best.”

a. there is a house cleaning at the New York customs office

b. Chester Arthur is released from his position

c. leads to a Hayes-Conkling feud

4. Hayes is forced to deal with serious labor strife - railway strikes of 1877 - Hayes calls out federal troops to help put them down - how would Republicans feel about this - why?

5. the Chinese Exclusion Act is passed over Hayes veto - a symbol of reemerging nativist sentiment

6. Hayes is not renominated in 1880 because party insiders couldn’t control him

IV. Politics in the 1880s

A. the election of 1880

1. Grant returns from a world tour too early to maintain enthusiasm

2. claims that the two term precedent applies only to two consecutive terms

3. James G. Blaine is the leading Republican - but the party is hurt by factionalism