Make your own free website on

The History Database

Chapter 23: Political Paralysis in the Gilded Age (1869-1896)

Art History
History of the Bible
World History
United States History


Ulysses S. Grant: Warrior / PresidentThe Wizard of Oz



Cover ImageCover Image


Chapter Outline

I. The “Bloody Shirt” Elects Grant

  1. The Republicans nominated Civil War General Ulysses S. Grant, who was a great soldier but had no political experience.
    • The Democrats could only denounce military Reconstruction and
      couldn’t agree on anything else, and thus, were disorganized.
    • The Republicans got Grant elected (barely) by “waving the
      bloody shirt,” or reliving his war victories, and used his
      popularity to elect him, though his popular vote was only slightly
      ahead of rival Horatio Seymour. Seymour was the Democratic candidate
      who didn’t accept a redemption-of-greenbacks-for-maximum-value
      platform, and thus doomed his party.
  2. However, due to the close nature of the election, Republicans could not take future victories for granted.

II. The Era of Good Stealings

  1. Despite the Civil War, the population still mushroomed, partially
    due to immigration, but during this time, politics became very corrupt.

    • Railroad promoters cheated gullible customers.
    • Stock-market investors were a cancer in the public eye.
    • Too many judges and legislators put their power up for hire.
  2. Two notorious millionaires were Jim Fisk and Jay Gould.
    • In 1869, the pair concocted a plot to corner the gold market that
      would only work if the treasury stopped selling gold, so they worked on
      President Grant directly and through his brother-in-law, but their plan
      failed when the treasury sold gold.
  3. The infamous Tweed Ring (AKA, “Tammany Hall) of NYC, headed
    by “Boss” Tweed, employed bribery, graft, and fake
    elections to cheat the city of as much as $200 million.

    • Tweed was finally caught when The New York Times secured evidence of his misdeeds, and later died in jail.
    • Samuel J. Tilden gained fame by leading the prosecution of Tweed,
      and he would later use this fame to become the Democratic nominee in
      the presidential election of 1876.
    • Thomas Nast, political cartoonist, constantly drew against Tammany’s corruption.

III. A Carnival of Corruption

  1. Grant, an easy-going fellow, apparently failed to see the
    corruption going on, even though many of his friends wanted offices and
    his cabinet was totally corrupt (except for Secretary of State Hamilton
    Fish), and his in-laws, the Dent family, were especially terrible.
  2. The Credit Mobilier, a railroad construction company that paid
    itself huge sums of money for small railroad construction, tarred

    • A New York newspaper finally busted it, and two members of Congress
      were formally censured (the company had given some of its stock to the
      congressmen) and the Vice President himself was shown to have accepted
      20 shares of stock.
  3. In 1875, the public learned that the Whiskey Ring had robbed the
    Treasury of millions of dollars, and when Grant’s own private
    secretary was shown to be one of the criminals, Grant retracted his
    earlier statement of “Let no guilty man escape.”

    • Later, in 1876, Secretary of War William Belknap was shown to have pocketed some $24,000 by selling junk to Indians.

IV. The Liberal Republican Revolt of 1872

  1. By 1872, a power wave of disgust at Grant’s administration
    was building, despite the worst of the scandals not having been
    revealed yet, and reformers organized the Liberal Republican Party and
    nominated the dogmatic Horace Greeley.

    • The Democratic Party also supported Greeley, even though he had
      blasted them repeatedly in his newspaper (the New York Tribune), but he
      pleased them because he called for a clasping of hands between the
      North and South and an end to Reconstruction.
  2. The campaign was filled with more mudslinging (as usual), as
    Greeley was called an atheist, a communist, a vegetarian, and a signer
    of Jefferson Davis’s bail bond (that part was true) while Grant
    was called an ignoramus, a drunkard, and a swindler.

    • Still, Grant crushed Greeley in the electoral vote and in the popular vote was well.
  3. In 1872, the Republican Congress passed a general amnesty act that
    removed political disabilities from all but some 500 former Confederate

V. Depression, Deflation, and Inflation

  1. In 1873, a paralyzing panic broke out, the Panic of 1873, caused by
    too many railroads and factories being formed than existing markets
    could bear and the over-loaning by banks to those projects.
    Essentially, the causes of the panic were the same old ones
    that’d caused recessions every 20 years that century: (1)
    over-speculation and (2) too-easy credit.

    • It first started with the failure of the New York banking firm Jay
      Cooke & Company, which was headed by the rich Jay Cooke, a
      financier of the Civil War.
    • Before, the greenbacks that had been issued in the Civil War were
      being recalled, but now, during the panic, the
      “cheap-money” supporters wanted greenbacks to be printed en
      mass again, to create inflation.
    • However, supporters of “hard-money” (actual gold and
      silver) persuaded Grant to veto a bill that would print more paper
      money, and the Resumption Act of 1875 pledged the government to further
      withdraw greenbacks and made all further redemption of paper money in
      gold at face value, starting in 1879.
  2. Debtors now cried that silver was under-valued (another call for
    inflation), but Grant refused to coin more silver dollars, which had
    been stopped in 1873, and besides, new silver discoveries in the later
    1870s shot the price of silver way down.

    • Grant’s name remained fused to sound money, though not sound government.
    • As greenbacks regained their value, few greenback holders bothered
      to exchange their more convenient bills for gold when Redemption Day
      came in 1879.
  3. In 1878, the Bland-Allison Act instructed the Treasury to buy and
    coin between $2 million and $4 million worth of silver bullion each

    • The minimum was actually coined and its effect was minimal on creating “cheap money.”
  4. The Republican hard-money policy, unfortunately for it, led to the
    election of a Democratic House of Representatives in 1874 and spawned
    the Greenback Labor Party in 1878.

VI. Pallid Politics in the Gilded Age

  1. “The Gilded Age,” was a term coined by Mark Twain
    hinting that times looked good, yet if one scratched a bit below the
    surface, there were problems. Times were filled with corruption and
    presidential election squeakers, and even though Democrats and
    Republicans had similar ideas on economic issues, there were
    fundamental differences.

    • Republicans traced their lineage to Puritanism.
    • Democrats were more like Lutherans and Roman Catholics.
    • Democrats had strong support in the South.
    • Republicans had strong votes in the North and the West, and from
      the Grand Army of the Republic (G.A.R.), an organization made up of
      former Union veterans.
  2. In the 1870s and the 1880s, Republican infighting was led by rivals
    Roscoe Conkling (Stalwarts) and James G. Blaine (Half-Breeds), who
    bickered and deadlocked their party.

VII. The Hayes-Tilden Standoff, 1876

  1. Grant almost ran for a third term before the House derailed that
    proposal, so the Republicans nominated Rutherford B. Hayes, dubbed the
    “Great Unknown” because no one knew much about him, while
    the Democrats ran Samuel Tilden.

    • The election was very close, with Tilden getting 184 votes out of a
      needed 185 in the Electoral College, but votes in four states,
      Louisiana, South Carolina, Florida, and part of Oregon, were unsure and
    • The disputed states had sent in two sets of returns, one Democrat, one Republican.

VIII. The Compromise of 1877 and the End of Reconstruction

  1. The Electoral Count Act, passed in 1877, set up an electoral
    commission that consisted of 15 men selected from the Senate, the
    House, and the Supreme Court, which would count the votes (the 15th man
    was to be an independent, David Davis, but at the last moment, he
  2. In February of 1877, the Senate and the House met to settle the
    dispute, and eventually, Hayes became president as a part of the rest
    of the Compromise of 1877. True to a compromise, both sides won a bit:

    • For the North—Hayes would become president if he agreed to
      remove troops from the remaining two Southern states where Union troops
      remained (Louisiana and South Carolina), and also, a bill would
      subsidize the Texas and Pacific rail line.
    • For the South—military rule and Reconstruction ended when the military pulled out of the South.
    • The Compromise of 1877 abandoned the Blacks in the South by
      withdrawing troops, and their last attempt at protection of Black
      rights was the Civil Rights Act of 1875, which was mostly declared
      unconstitutional by the Supreme Court in the 1883 Civil Rights cases.

IX. The Birth of Jim Crow in the Post-Reconstruction South

  1. As Reconstruction ended and the military returned northward, whites once again asserted their power.
    • Literacy requirements for voting began, voter registration laws
      emerged, and poll taxes began. These were all targeted at black voters.
    • Most blacks became sharecroppers (providing nothing but labor) or tenant farmers (if they could provide their own tools).
  2. In 1896, the Supreme Court ruled in the case of Plessy v. Ferguson
    that “separate but equal” facilities were constitutional.

    • Thus “Jim Crow” segregation was legalized.

X. Class Conflicts and Ethnic Clashes

  1. In 1877, the presidents of the nation’s four largest
    railroads decided to cut wages by 10%. Workers struck back, stopping
    work, and when President Hayes sent troops to stop this, violence
    erupted, and more than 100 people died in the several weeks of chaos.
  2. The failure of the railroad strike showed the weakness of the labor
    movement, but this was partly caused by friction between races,
    especially between the Irish and the Chinese.
  3. In San Francisco, Irish-born Denis Kearney incited his followers to terrorize the Chinese.
  4. In 1879, Congress passed a bill severely restricting the influx of
    Chinese immigrants (most of whom were males who had come to California
    to work on the railroads), but Hayes vetoed the bill on grounds that it
    violated an existing treaty with China.

    • After Hayes left office, the Chinese Exclusion Act, passed in 1882,
      was passed, barring any Chinese from entering the United
      States—the first law limiting immigration.

XI. Garfield and Arthur

  1. James A. Garfield
    • In 1880, the Republicans nominated James A. Garfield, a man from
      Ohio who had risen to the rank of major general in the Civil War, and
      as his running mate, a notorious Stalwart (supporter of Roscoe
      Conkling) was chosen: Chester A. Arthur of New York.
    • The Democrats chose Winfield S. Hancock, a Civil War general who
      appealed to the South due to his fair treatment of it during
      Reconstruction and a veteran who had been wounded at Gettysburg, and
      thus appealed to veterans.
    • The campaign once again avoided touchy issues, and Garfield
      squeaked by in the popular vote (the electoral count was wider: 214 to

      • Garfield was a good person, but he hated to hurt people’s feelings and say “no.”
    • Garfield named James G. Blaine to the position of Secretary of the
      State, and he made other anti-Stalwart acts, but on September 19, 1881,
      Garfield died after having been shot in the head by a crazy but
      disappointed office seeker, Charles J. Guiteau, who, after being
      captured, used an early version of the “insanity defense”
      to avoid conviction (he was hanged anyway).
  2. Chester Arthur
    • Chester Arthur didn’t seem to be a good fit for the
      presidency, but he surprised many by giving the cold shoulder to
      Stalwarts, his chief supporters, and by calling for reform, a call
      heeded by the Republican party as it began to show newly found
      enthusiasm for reform.
    • The Pendleton Act of 1883, the so-called Magna Charta of
      civil-service reform (awarding of government jobs based on ability, not
      just because a buddy awarded the job), prohibited financial assessments
      on jobholders, including lowly scrubwomen, and established a merit
      system of making appointments to office on the basis of aptitude rather
      than “pull.”

      • It also set up a Civil Service Commission, charged with
        administering open competitive service, and offices not
        “classified” by the president remained the fought-over
        footballs of politics.
      • Luckily, Arthur cooperated, and by 1884, he had classified nearly 10% of all federal offices, or nearly 14,000 of them.
    • The Pendleton Act partially divided politics from patronage, but it
      drove politicians into “marriages of convenience” with
      business leaders.

XII. The Blaine-Cleveland Mudslingers of 1884

  1. James G. Blaine became the Republican candidate, but some
    Republican reformers, unable to stomach this, switched to the
    Democratic Party and were called Mugwumps.
  2. The Democrats chose Grover Cleveland as their candidate but
    received a shock when it was revealed that he might have been the
    father of an illegitimate child.

    • The campaign of 1884 was filled with perhaps the lowest mudslinging in history.
    • The contest depended on how New York chose, but unfortunately, one
      foolish Republican insulted the race, faith, and patriotism of New
      York’s heavy Irish population, and as a result, New York voted
      for Cleveland; that was the difference.

XIII. “Old Grover” Takes Over

  1. Portly Grover Cleveland was the first Democratic president since
    James Buchanan, and as a supporter of laissez-faire capitalism, he
    delighted business owners and bankers.
  2. Cleveland named two former Confederates to his cabinet, and at
    first tried to adhere to the merit system (but eventually gave in to
    his party and fired almost 2/3 of the 120,000 federal employees), but
    he had his problems.

    • Military pensions plagued Cleveland; these bills were given to
      Civil War veterans to help them, but they were used fraudulently to
      give money to all sorts of people.
    • However, Cleveland showed that he was ready to take on the corrupt
      distributors of military pensions when he vetoed a bill that would add
      several hundred thousand new people on the pension list.

XIV. Cleveland Battles for a Lower Tariff

  1. By 1881, the Treasury had a surplus of $145 million, most of it
    having come from the high tariff, and there was a lot of clamoring for
    lowering the tariff, though big industrialists opposed it.
  2. Cleveland wasn’t really interested in the subject at first,
    but as he researched it, he became inclined towards lowering the
    tariff, so in late 1887, Cleveland openly tossed the appeal for lower
    tariffs into the lap of Congress.

    • Democrats were upset at the obstinacy of their chief while Republicans gloated at his apparently reckless act.

XV. The Billion Dollar Congress

  1. The new Speaker of the House, Thomas B. Reed, was a large, tall man, a tremendous debater, and very critical and quick man.
    • To solve the problem of reaching a quorum in Congress, Reed counted
      the Democrats who were present yet didn’t answer to the roll
      call, and after three days of such chaos, he finally prevailed, opening
      the 51st, or “Billion Dollar” Congress—one that
      legislated many expensive projects.

XVI. The Drumbeat of Discontent

  1. The Populist Party emerged in 1892 from disgruntled farmers.
    • Their main call was for inflation via free coinage of silver.
    • They called for a litany of items including: a graduated income
      tax, government regulation of railroads and telegraphs/telephones,
      direct elections of U.S. senators, a one term limit, initiative and
      referendum, a shorter workday, and immigration restriction.

XVII. Cleveland and Depression

  1. Grover Cleveland won, but no sooner than he had stepped into the
    presidency did the Depression of 1893 break out. It was the first such
    panic in the new urban and industrial age, and it caused much outrage
    and hardships. This completed the almost predictable, every-20-year
    cycle of panics during the 1800s (panics occurred during 1819, 1837,
    1857, 1873, and 1893).
  2. About 8,000 American business houses collapsed in six months, and dozens of railroad lines went into the hands of receivers.
    • This time, Cleveland had a deficit and a problem, for the Treasury
      had to issue gold for the notes that it had paid in the Sherman Silver
      Purchase Act, and according to law, those notes had to be reissued,
      thus causing a steady drain on gold in the Treasury—the level
      alarmingly dropped below $100 million at one point.
  3. Meanwhile, Grover Cleveland had developed a malignant growth under
    the roof of his mouth, and it had to be secretly removed in a surgery
    that took place aboard his private yacht; had he died, Adlai E.
    Stevenson, a “soft money” (paper money) man, would have
    caused massive chaos with inflation.
  4. Also, 33 year-old William Jennings Bryan was advocating “free
    silver,” and gaining support for his beliefs, but an angry
    Cleveland used his executive power to break the filibuster in the
    Senate—thus alienating the silver-supporting Democrats.

XVIII. Cleveland Breeds a Backlash

  1. Cleveland was embarrassed at having to resort to J.P. Morgan to bale out the depression.
  2. He was also embarrassed by the Wilson-Gorman Tariff. He’d
    promised to lower the tariff, but so many tack-ons had been added, the
    result was nill.

    • Further, the Supreme Court struck down an income tax. It looked like all politicians were tools of the wealthy.


The History Database