Ch 23: Political Paralysis in the Gilded Age (1869-1896)
A) Election of 1868: “Grantism,” a Carnival of Corruption
1. Rep nom Gen. US Grant- mil Recon of S, “Let us have peace”; agst Horatio Seymour-anti-mil Recon
2. Black Friday Scandal (Sept 24, 1869)
B) Disgust of Grantism--> Liberal Republican “Revolt” of 1872
C) Panic of 1873 & Hard Money
1. Overspeculation: Too many people had taken out loans of which they were unable to pay back due to lack of profit from where they had invested their money.
2. Debtors intensify clamor for inflationary policies
D) Pallid Politics in the Gilded Age
1. Rep nom Gen. US Grant- mil Recon of S, “Let us have peace”; agst Horatio Seymour-anti-mil Recon
2. Black Friday Scandal (Sept 24, 1869)
- Millionaires Jim Fisk & Jay Gould bought tons of gold to drastically raise its price, which they would sell later on at an enormous profit. This would only work if Treas refrained from selling Au.
- When aware that it was harming public, Grant got Treas to sell $4mn of gold--> prices fall
- Most investors severely hurt, but Grant had done nth crooked, tho he acted stupidly, indiscreetly
- His luck ran out when NY Times found damning evidence & published it in 1871; Cartoonist Thomas Nast pilloried Tweed (both times, despite bribe to desist)
- NY attorney Samuel J. Tilden headed prosecution-->Tweed died in jail
- To prevent gov interference, shares of its valuable stock distributed to key cong’men & VP bribed
- Newspaper & Cong probe--> formal censure of 2 congmen but no prosecution tho $20mn bilked
- Liquor taxes raised extremely high to pay off CivWar-->distillers bribed Treas officials
- 100+ officials convicted, including Grant’s private secretary who he pardoned--> his rep drops
B) Disgust of Grantism--> Liberal Republican “Revolt” of 1872
- Liberal Rep Party nominated NY Tribune editor Horace Greeley, also nom by Dems
- Reps renom Grant; both candidates had careers not in politics & both unqualified for high pol office
- Despite defeat, LRP left visible impact:
- Rep Cong 1872 passed amnesty act, removing pol disabilities from most Confed leaders
- Cong reduced high Civil War tariffs & enacted mild civil-service reform to lessen spoils system
C) Panic of 1873 & Hard Money
1. Overspeculation: Too many people had taken out loans of which they were unable to pay back due to lack of profit from where they had invested their money.
2. Debtors intensify clamor for inflationary policies
- Treas withdrew much greenbacks b/c it had depreciated too much; now debtors demanded it
- In 1870s, Treas unrealistically held that 16oz Ag=1oz Au, much lower than market price--> Ag miners stopped selling it to fed mints--> Cong dropped coinage of silver in 1873--> New Ag discoveries shot production up & forced Ag prices down--> W miners join debtors to demand Ag
- Persuaded Grant to veto bill to print more paper money in 1874
- Resumption Act 1875 pledged gov to further withdrawal of greenbacks from circulation & redemption of all paper currency in gold at face value
- Contraction policy: reduction of greenbacks + Treas accumulate gold stocks; worsened impact of depression, but restored gov’s credit rating, bringing greenbacks to full face value.
- When Redemption Day came in 1879, few greenback holders bothered to exchange bills for Au.
D) Pallid Politics in the Gilded Age
- Pres electn squeakers, HoR maj party switched 6x-->politicians tiptoed timidly-->trivial & petty record
- Few econ issues separated Reps & Dems. Rather, they were divided by ethnic/cultural diffs:
3. Essential to both parties was patronage: jobs for votes, kickbacks, and party service
4. Republican split into Stalwart & Half-Breed factions
E) Compromise of 1877 & Birth of Jim Crow Laws
F) Election of 1880, Garfield’s Assassinationà Civil Service Reform
1. Rep James Garfield won 1880 election, but assassinated by Charles Guiteauà Chester A Arthur
2. Pendleton Act 1883 made compulsory campaign contributions from fed employees illegal & est Civil Service Commission to make apptmts to fed jobs based on exams
3. Politicians now forced to look elsewhere for $$à big corporations
G) Election of 1884--> Grover Cleveland (D)--> Tariff--> Ben Harrison (R)--> Billion-Dollar Congress--> Tariff
H) Populism: The Drumbeat of Discontent
1. Frustrated farmers in W & S banded together to form Populist Party. Demands
I) GC Takes Office Again 1892, the Panic of 1893, and the Tariff of 1894
Forgettable presidents: Grant, Hayes, Garfield, Arthur, Harrison, Cleveland
4. Republican split into Stalwart & Half-Breed factions
- Stalwart, led by Roscoe Conkling, unblushingly embraced patronage.
- Half-Breeds, led by James Blaine, argued emptily for civ-serv reform
- Point of disagreement: who should grasp the ladle that dished out the spoils
E) Compromise of 1877 & Birth of Jim Crow Laws
- Rep nom Rutherford B Hayes; Dem nom Samuel J TildenàDem won popvote, but 1 vote shy in EC
- Decisive votes would come from LA, SC, FL each sent 2 sets of ballots to Cong, but there was no winner
- Electoral Count Act 1877 set up 15-man electoral comm consisting to determine which party won.
- Rep victory
- Withdraw troops
- Bill RR’s constructn in S
- Blacks forced into sharecropping, tenant farming, scarcely better than slavery
- Jim Crow Laws: literacy test, voter-registration laws, poll taxes
- Plessy v. Fergusson 1986 justified segregation; “separate but equal” facilities constitutional
F) Election of 1880, Garfield’s Assassinationà Civil Service Reform
1. Rep James Garfield won 1880 election, but assassinated by Charles Guiteauà Chester A Arthur
2. Pendleton Act 1883 made compulsory campaign contributions from fed employees illegal & est Civil Service Commission to make apptmts to fed jobs based on exams
3. Politicians now forced to look elsewhere for $$à big corporations
G) Election of 1884--> Grover Cleveland (D)--> Tariff--> Ben Harrison (R)--> Billion-Dollar Congress--> Tariff
- Rep nom James Blaine, Dem nom Grover Cleveland supported by Mugwumps, reform-minded Reps
- 1st Dem for 28 yrs: questions raised abt whether “party of disunion” could be trusted to rule the Union.
- Vetoed many bills lobbied thru Cong by GAR (benefits granted to deserters, men who never served, etc)
- High tariff for CivWaràSurplus of $$ in Treasury--> GC proposes lowering tariff to bring lower prices to consumersà hurt nation’s factories & overall economy--> GC lost 1888 election to Rep Ben Harrison
- Named so for its lavish spendings: veteran pensions, increased gov purchase of Ag, McK Tariff, thanks to Spkr of House Thomas B Reed who intimidated House (many Dems trying to delay) to his will
- McKinley Tariff Act 1890 raised tariffs-->more troubles to farmers who were forced to buy expensive products from Am manufacturers while selling their own products into highly competitive world mkts
- Tariffà Rep Party lost public support & majority in Cong
H) Populism: The Drumbeat of Discontent
1. Frustrated farmers in W & S banded together to form Populist Party. Demands
- Inflation (free silver)
- Graduated income tax
- Gov owned RR, telegraph/phone
- Direct electn of Sen, 1-term pres limit
- Initiative & Referendum
- Shorter workday, imm restriction
I) GC Takes Office Again 1892, the Panic of 1893, and the Tariff of 1894
- Panic of 1893 caused by overspec, labor disorders, agricultural depression
- GC saw no alternative but to halt bleeding away of gold by repealing Sherman Silver Purchase Act 1890 (created by Harrison’s admin to increase amt of Ag in circulation--> Ams believe less expensive silver to replace gold as main currency--> Ams withdraw assets in gold, depleting Treas’s gold supply)
- GC covertly turned to JP Morgan to lend $65mn in gold to increase Treas’ reserve.
- Wilson-Gorman Tariff of 1894 lowered tariffs & contained 2%tax on incomes over $4,000. (SupCt ruled income taxes unconst in 1895)--> Dems lose positions in Congà Rep advantage
Forgettable presidents: Grant, Hayes, Garfield, Arthur, Harrison, Cleveland
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