Political Paralysis in the Gilded Age

1. The “Bloody Shirt” Elects Grant

a. The people bribed Grant with money and gifts because they believed that a good general would make a good
president rather than a politician – wrong because Grant had no idea of politics.
b. Republicans nominated him in 1868 – continued military Reconstruction but Grant advocated peace.
c. Democrats denounced military Reconstruction, but couldn’t agree on anything else – wealthy easterners wanted
federal war bonds redeemed in gold and poorer Midwesterners wanted it to be redeemed in greenbacks (“Ohio
Idea”).
d. Democrats nominated Horatio Seymour who denounced the Ohio Idea and lost some of the votes.
e. Republicans “waved the bloody shirt” to gain support for their candidate.
f. Grant won by a small margin of the popular vote and mostly because of freedmen.
2. The Era of Good Stealings
a. “Jubilee Jim” Fisk and Jay Gould in 1869 set up an agreement with Grant and his brother-in-law that they would not
sell gold. On Black Friday, they madly bid the price of gold higher, eventually forcing the treasury to release gold,
despite Grant’s protests.
b. The Tweed Ring in New York run by “Boss” Tweed stole $200 million from citizens of the metropolis. In 1871, the
New York Times secured evidence proving corruption while Thomas Nast drew political cartoons about the scandal.
3. A Carnival of Corruption
a. Crédit Mobilier Scandal (1872) – Union Pacific Railroad insiders formed the construction company and hired
themselves at high prices. The company gave its valuable stock to various congressional members to keep it quiet.
In the end, two congressmen were censured and the vice president had accepted payments from the company.
b. Whiskey Ring (1874-1875) – smuggled millions in excise taxes from the federal treasury. His secretary got
acquitted of charges because Grant wrote a personal letter than exonerated him. Secretary of War William Belknap
resigned after pocketing bribes from suppliers to Indian reservations.
4. The Liberal Republican Revolt of 1872
a. Reform-minded citizens banded together to form the Liberal Republican party that wished to rid the Washington
administration of corruption and end military Reconstruction.
b. The Republicans renominated Grant.
c. The Liberal Republicans nominated erratic Horace Greenley, editor of the New York Tribune. Democrats endorsed
the nomination, despite his criticisms of them, because he wished to reunite the country.
d. Despite a mud-splattering campaign, Grant won reelection.
e. The Republican Congress in 1872 pardoned most former Confederate leaders and Congress reduced the high Civil
War tariffs and fumigated the Grant administration with mild civil-service reform.
5. Depression, Deflation, and Inflation
a. Promoters had laid more railways, sunk more mines, erected more factories and sowed more grain fields than the
markets could bear. Banks had overinvested in such ventures and when profits didn’t happen, so didn’t payments.
b. Freedmen were hard hit as their banks lost their money, and their entire economic structure collapsed.
c. Debtors brought up the issue of greenbacks again. They wanted more money with the logic that with more money,
debts would be easier to pay. In 1874, creditors convinced Grant to veto a bill that would print more paper money.
With the Resumption Act of 1875, the government pledged to take more greenbacks out of circulation and
redemption all paper currency at face value in gold beginning 1879.
d. Debtors now looked towards silver. The Treasury insisted that silver was only worth a portion of gold despite open-
market prices. Silver miners stopped selling to the government and they stopped the coinage of silver in 1873. In the
later 1870s, new deposits drove prices of silver down. Silver miners joined with debtors to end the “Crime of ’73.”
This was merely a ploy to encourage inflation.
e. The “contraction” policy of Grant’s accumulated gold for Redemption Day in 1869, but the policy already had a
deflationary effect. Few people took advantage of Redemption Day and traded light paper for heavy gold.
f. This helped elect a Democratic House of Rep. and spawned the Greenback Labor party.
6. Pallid Politics in the Gilded Age
a. Most politics around this time were small and petty – there was a delicate balance to be maintained. Despite rough
agreement on most issues, the parties were fiercely competitive – demanded loyalty from members.
b. Republicans tended to be like Puritans, strict in their morality and believed that government should regulate the
economic and social well-being of the country. They tended to be in the Midwest and the rural Northeast.
c. Democrats tended to be immigrant Lutherans and Roman Catholics who were not as strict and pleaded tolerance of
differences and spurned government intervention in social lives. They were in the South and the northern industrial
cities. Grateful freedmen and the Grand Army of the Republic (GAR – Civil War Vets) voted Republican.
d. Patronage – people voted for a party for favors. In the Republican party, the “Stalwart” faction led by Rocoe and
Conkling traded civil-service jobs for votes. The Half-Breeds led by James G. Blaine wanted to dish out the spoils.
7. The Hayes-Tilden Standoff, 1876
a. In 1876, Grant tried to run for reelection. The House reminded the country why the 2 term tradition was in place.
 b. With the Stalwart and Half-Breeds fighting, the Republicans nominated a compromise, Rutherford B. Hayes, the
“Great Unknown.” His greatest asset was that he was from the swing state of Ohio, a potent electorate force.
c. Samuel J. Tilden, the man who exposed Boss Tweed, had almost enough of the electoral votes, but four states had
doubtful elections. Tilden should have picked up some of these states because he beat Hayes in popular votes.
d. Both parties sent “visiting statesmen” which ended up returning two electorate returns, one for each party. The
Constitution only stated that they shall be opened by the President of the senate. If the President of the senate (R)
counts them, then the Repub. will win. If the Speaker of the House (D) counts, then the Dem. will win.
8. The Compromise of 1877 and the End of Reconstruction
a. The Compromise of 1877 – The Electoral Count Act passed by Congress in 1877 established an electoral
commission of fifteen men chosen from Congress and the Supreme Court.
b. In Feb. 1877 – Congress met to decide the vote. When the Florida votes came up, it was referred to an electorate
commission of 8 R and 7 D who decided to take the Republican votes.
c. The rest of the Compromise of 1877 said that Hayes would take office if he withdrew troops from the remaining
states, Louisiana and South Carolina. Repubs gave Dems patronage and support for the bill subsidizing the Texas
and Pacific Railroad’s construction. This narrowly avoiding conflict and Hayes was sworn in.
d. With this deal, the Repub party abandoned its commitment to the freedmen of the South.
e. The Civil Rights Act of 1875 guaranteed equal accommodations in public places and outlawed racial discrimination
in jury selections, but it wasn’t enforced. It was declared unconstitutional in the Civil Rights Cases (1883).
f. When Hayes took troops out of the South, the carpetbagger governments collapsed.
9. The Birth of Jim Crow in the Post-Reconstruction South
a. Without the troops, blacks were suppressed and white Dems (“redeemers”) overtook the government. Blacks who
tried to assert their rights became unemployed, evicted or physically harmed.
b. Blacks and poor whites found themselves as sharecroppers. With the “crop-lien” system, storekeepers gave credit to
small farmers in exchange for their harvests. Merchants manipulated the system to keep the blacks impoverished.
c. Jim Crow laws were developed to disenfranchise black voters by enacting literacy requirements, voter-registration
and pool taxes. These laws were validated by Plessy v. Ferguson (1896) that stated that “separate but equal”
facilities were constitutional.
d. Blacks were subjected to inferior schools, bathrooms and were separated in every way. To ensure the “new order”
blacks that violated this code were dealt with severely (lynching).
10. Class Conflict and the Ethnic Clashes
a. In 1877, the presidents of the four largest railroads decided to cut wages by 10%, causing riots from workers. Hayes
sent in federal troops to subdue them, gaining support from the working class. Work stoppages spread to all major
cities and the death toll overall was high.
b. Racial and ethnic divides between workers were a weakness to the movement. The Irish and Chinese in particular
hated each other. The Chinese were mainly from southern China that came to work the railroad. Some returned
home, but some stayed in America where they suffered through menial jobs and a country they didn’t know.
c. The Irish Denis Kearney incited his followers to attack the Chinese. They were mainly immigrated Europeans who
resented the cheap labor the Chinese provided.
d. In 1882, Congress passed the Chinese Exclusion Act that prohibited more immigration from China. Some people
even tried to take away the rights of native born Chinese-Americans, but the Supreme Court ruled in US v. Wong
Kim Ark that the 14th amendment provided for citizenship based on birthplace.
11. Garfield and Arthur
a. During the 1880 Presidential election, the Republican Old Guard denounced Hayes and nominated James A.
Garfield from Ohio and as his vice president, a Stalwart, Chester A. Arthur. Garfield barely won over Democratic
candidate Winfield Scott Hancock.
b. His secretary of state James G. Blaine and his Stalwart nemesis Sen. Roscoe Conkling fought as two factions of the
Republican party. Charles J. Guiteau assassinated Garfield so that Stalwart Arthur would be president. Guiteau
claimed insanity, but he was still convicted.
c. This assassination forced the Republican party to reform the spoils system. Arthur convicted several fraud cases and
spurned his old friends when he took office. The Pendleton Act of 1883 established that compulsory campaign
contributions from federal employees were illegal and the Civil Service Commission which made the appointments
for federal jobs based on examinations, not political pull.
d. While well meaning, this bill forced politicians to look for money. They looked towards companies, which bred
politicians who could wine and dine big-business leaders. Arthur’s party turned their back on him.
12. The Blaine-Cleveland Mudslingers of 1884
a. In 1884, Blaine was nominated for the Republicans. However, reform-minded Republicans (called Mugwumps)
were astounded by his connection to some corrupt dealings (“Mulligan letters”), leading them to the Democrats.
b. Democrats turned to noted reformer Grover Cleveland, who was noted for his integrity. However, Republicans
digging for dirt soon found that he had been involved in an affair with a widow. Cleveland had made economic
provisions for the child. Democrats urged him to lie, but he refused.
 c. The campaign hinged more on personalities than principles since there was little difference between the parties. The
whole election ended up hinging on New York, where a Republican clergyman damned the Democrats for their
“Rum, Romanism., and Rebellion,” insulting the Irish-Americans with all three terms. Blaine had stayed silent,
seeming to give consent. Cleveland barely won the presidency.
13. “Old Grover” Takes Over
a. He was the first Democrat since Buchanan 24 years earlier. He advocated laissez-faire policy, which endeared him
to the business professionals. He even vetoed a bill to provide Texas farmers with seeds after a drought.
b. Cleveland nominated to his cabinet 2 former Confederates. As for civil service, Cleveland was between the faithful
Democrats and the Mugwump reformers. He originally followed the reform, but ended up with the patronage.
c. The Grand Army of the Republic (GAR) lobbied hundreds for military pension bills through Congress, each giving
the undeserving pensions. Cleveland eventually wrote his own.
14. Cleveland Battles for a Lower Tariff
a. During the Civil War, the tariffs had been jacked up to support the war. The Republican industry was highly in favor
of continuing this. But the revenue gained from this was embarrassing to the government.
b. There were two ways to fix this: use the excess revenue to curry favor with the veterans and other specialty groups,
or reduce the tariff, which the industrialists were opposed to.
c. Cleveland saw that lower tariffs would lower prices and mean less protection for monopolies. It would also get rid
of the Treasury surplus that made a mockery of his economic frugality policy. In 1887, he tossed a proposal to
Congress for a lower tariff. For the first time, the parties were divided on an issue.
d. Reluctantly, the Democrats nominated Cleveland again. Republicans nominated Benjamin Harrison, grandson of
“Tippecanoe” Harrison. The tariff was the main issue.
e. The Republicans were spurred into action and raised an impressive amount of money to buy votes of “repeaters” and
“floaters” in the swing state of Indiana.
f. Harrison won the Electoral College but not the popular vote. Cleveland became the first sitting president to be voted
out of office since Van Buren in 1840.
15. The Billion-Dollar Congress
a. Republicans were happy to use the surplus to their advantage. However, in the House of Representatives, they had
only 3 more votes than a quorum and Democrats were planning to obstruct the proceedings. Speaker of the House
Thomas B. Reed took no crap from the Democrats, and if they were there, they were counted present.
b. With Reed, the “billion-dollar” Congress began the first in history to do so. Congress gave excessive pensions to
Civil War veterans and increased the govt purchase of silver. In order to keep up revenues and protect Republican
businesses, they passed the McKinley Tariff Act of 1890, boosting tariffs to the highest ever in peacetime.
c. The tariff forced small farmers to buy high-priced protected American goods while selling their goods in an
unprotected market. This caused them to resent Republicans, voting the majority out of Congress. The new
Democrats included some members of the Farmers’ Alliance, a militant organization of farmers.
16. The Drumbeat of Discontent
a. In 1893, the People’s Party (“Populists”) arrived. Based on the Farmers’ Alliance, they demanded inflation through
free coinage of silver at a high rate; a graduated income tax; government ownership of the railroad, telegraph, and
telephone; the direct election of senators, the adoption of the initiative and referendum to allow citizens to shape
legislation more directly; a shorter workday; and immigrant restriction. They nominated James B. Weaver.
b. At Andrew Carnegie’s Homestead steel plant near Pittsburgh the company official called in armed Pinkerton
detectives to crush a strike. The strikers forced them to surrender after a battle. Federal troops were summoned and
the strike and the union ended.
c. Federal troops crushed a strike of silver-miners in Idaho.
d. The Populists had a great showing, but still fell short of winning the election. The main reason was that the Southern
white farmers didn’t support the Populists. Populists like Tom Watson curried the black votes of the south, including
the Colored farmers’ National Alliance. The white farmers spurred the Populists to perpetuate the racial inequality.
e. The reminder of black political strength led the white southerners to more aggressively use the literary test and poll
taxes, including the “grandfather clause” to exempt whites. More strict Jim Crow laws were established to enforce
racial segregation in public places and lynchings backed up the intimidation.
f. The Populist party eventually abandoned its interracial appeals and supported black disenfranchisement.
17. Cleveland and the Depression
a. Grover Cleveland was reelected, the only president to do so once defeated. He only just took office when the
depression of 1893 began. Some causes were overbuilding and overspeculation, labor disorders, and agricultural
depression. The free-silver mantra damaged American credit and European banks called in loans.
b. Businesses died, railroad lines were abandoned, gangs of hoboes wandered the streets and local charities were
woefully inadequate. The government was bound by the laissez-faire psychology of the time.
c. The Treasury was required to issue legal tender notes for the silver bullion it bought. The owners would then trade it
in for gold and the notes had to be reissued. Then the cycle would repeat, draining the federal government.
 d. Cleveland had no alternative but to repeal the Sherman Silver Purchase Act of 1890 to stop the draining of gold. He
called a session of Congress during which Dem William Jennings Bryan and others championed free silver.
Cleveland used his job-granting power to break the filibuster, alienating the Dem silverites and disrupting his party.
e. In 1895, Cleveland turned to J.P. Morgan, head of a Wall Street syndicate. After negotiations, he lent $65 million in
gold, half of it obtained overseas and they charged $7 million in commission. They dammed up the Treasury.
18. Cleveland Breeds a Backlash
a. Silverites and other debtors condemned Cleveland’s dealings with the Wall Street ogre.
b. The Wilson-Gorman Tariff in 1894 was intended to lower tariffs, but by the time it got through Congress, it was so
loaded with special interests that it failed to lower the McKinley Tariff rates. Cleveland allowed the bill that also
included a 2% income tax on incomes over $4,000.
c. In 1895, the Supreme Court struck down the income-tax provision, proving to the Populists that the courts were
tools of the plutocrats.
d. The Democrats were ejected from Congress in 1890 because of their failures and the depression. Republicans began
looking towards the presidency.