Chapter 23

Political Paralysis in the Gilded Age



The "Bloody Shirt" Elects Grant

The Republicans nominated General Grant for the presidency in 1868.  The Republican Party supported the continued Reconstruction of the South, while Grant stood on the platform of "just having peace."

The Democrats nominated Horatio Seymour.

Grant won the election of 1868.

The Era of Good Stealings 

Jim Fisk and Jay Gould devised a plot to drastically raise the price of the gold market in 1869.  The two men bought and hoarded a large amount of gold, driving up the price. On "Black Friday," September 24, 1869, the Treasury was forced to sell gold from its reserves to lower the high price of gold.

"Boss" Tweed employed bribery, graft, and fraudulent elections to milk New York of as much as $200 million.  (Tweed Ring)  Tweed was eventually put into prison.


A Carnival of Corruption

Members of the federal government also participated in illicit/unethical activity.

The Credit Mobilier scandal erupted in 1872 when Union Pacific Railroad insiders formed the Credit Mobilier construction company and then hired themselves at inflated prices to build the railroad line, earnings a lot of money. The company paid off members of Congress and the Vice President.


The Liberal Republican Revolt of 1872

The Liberal Republican Party was formed in 1872 in response to the political corruption in Washington and their dissatisfaction with military Reconstruction.

The Liberal Republican Party met in Cincinnati and chose Horace Greeley as their presidential candidate for the election of 1872.  The Democratic Party also chose Greeley as their candidate.  The Republican Party continued to put its support behind President Grant.  Grant won the election of 1872.

The Liberal Republicans caused the Republican Congress to pass a general amnesty act in 1872, removing political restrictions from most of the former Confederate leaders.  Congress also reduced high Civil War tariffs and gave mild civil-service reform to the Grant administration.


Depression, Deflation, and Inflation

Over-speculation was the primary cause of the panic of 1873. Banks gave too many imprudent loans to support over-expansion. When profits failed to materialize, people were unable to pay back their loans.

Mistrust of the government lead to high inflation of the greenback. Supported by advocates of hard money (coin money), the Resumption Act of 1875 required the government to continue to withdraw greenbacks from circulation and to redeem all paper currency in gold at face value beginning in 1879.

The coinage of silver dollars was stopped by Congress in 1873 when silver miners began to stop selling their silver to the federal mints; miners could receive more money for the silver, elsewhere.

The policy of the Treasury accumulating gold stock to replace the greenbacks was known as "contraction." This policy increased the value of the greenback due to its reduction in circulation.

The Republican hard-money policy had negative political ramifications and it helped to elect a Democratic House of Representatives in 1874.


Pallid Politics in the Gilded Age

Throughout most of the Gilded Age (a name given to the 30 years after the Civil War by Mark Twain) the political parties in government had balanced out. Few significant economic issues separated the Democrats and Republicans.

Republican voters tended to stress strict codes of personal morality and believed that the government should play a role in regulating the economic and moral affairs of society.  They were located in the Midwest and Northeast.  Many Republican votes came from the Grand Army of the Republic, a politically active fraternal organization consisting of many Union veterans of the Civil War.

Democrats were immigrant Lutherans and Roman Catholics who believed in toleration of differences in an imperfect world.  They also opposed the government imposing a single moral standard on the entire society.  Democrats were found in the South and in the northern industrial cities.

Both parties supported patronage, the principle of giving jobs to your political supporters.


The Hayes-Tilden Standoff, 1876

Congress passed a resolution that limited the presidency to two terms, after Grant started to consider running for a 3rd term.

The Republicans chose Rutherford B. Hayes as their presidential candidate for the election of 1876.  The Democrats chose Samuel J. Tilden.

In the election, Tilden won the popular vote, but he was 1 vote shy from winning in the Electoral College (184 of 185).  20 electoral votes were in dispute in Louisiana, South Carolina, and Florida. Each state had sent two ballot counts to Congress. One ballot count said that the Republicans had won, while the other count said that the Democrats had won.

Controversy arose over which candidate should be awarded the disputed electoral votes.


The Compromise of 1877 and the End of Reconstruction

The Compromise of 1877 was passed by Congress in 1877. Contained within the compromise was the Electoral Count Act, which set up an electoral commission consisting of 15 men from the Senate, the House of Representatives, and the Supreme Court. The commission ultimately gave the election to Hayes (Republican).

The Democrats were outraged at the outcome of the election, but agreed that Hayes could take office if he withdrew the federal troops from Louisiana and South Carolina.

With the Hayes-Tilden deal, the Republican Party abandoned its commitment to racial equality.

The Civil Rights Act of 1875 was supposed to guarantee equal accommodations in public places and prohibited racial discrimination in jury selection.  The Supreme Court ultimately ruled most of the Act unconstitutional, stating that the 14th Amendment only prohibited government violations of civil rights, not the denial of civil rights by individuals.


The Birth of Jim Crow in the Post-Reconstruction South

After Reconstruction ended in the South, white Democrats ("Redeemers") resumed political power in the South and began to enact laws discriminating against blacks.

Blacks were forced into sharecropping and tenant farming.  Through the "crop-lien" system, small farmers who rented land from the plantation owners were kept in perpetual debt and forced to continue to work for the owners.

Eventually, state-level legal codes of segregation known as Jim Crow laws were enacted.  The Southern states also enacted literacy requirements, voter-registration laws, and poll taxes to ensure that Southern blacks could not vote.

The Supreme Court ruled in favor of the South's segregation in the case of Plessy vs. Ferguson (1896), declaring that "separate but equal" facilities for blacks were legal under the 14th Amendment.

Class Conflicts and Ethnic Clashes

Following the panic of 1873 and the resulting depression, railroad workers went on strike after their wages were cut by President Hayes.  The strike failed, exposing the weakness of the labor movement.

Many immigrants came to United States hoping to find riches, but many were dismayed when they found none. They either returned home or remained in America and faced extraordinary hardships.

People on the West Coast attributed declining wages and economic troubles to the hated Chinese workers.  To appease them, Congress passed the Chinese Exclusion Act in 1882, stopping Chinese immigration into America.


Garfield and Arthur

Because President Hayes was despised by his own Republican Party, James A. Garfield was chosen as the presidential candidate for the election of 1880.  Garfield was apart of the Half-Breed faction of the Republican Party. His Vice President, Chester A. Arthur, was apart of the Stalwart faction.  The Democrats chose Civil War hero, Winfield Scott

Garfield won the election of 1880, but he was assassinated by Charles J. Guiteau at a Washington railroad station. The expected implication of the assassination was that after Arthur took over as president, he would replace the Half-Breed Republican employees with Stalwarts.

The death of Garfield shocked politicians into reforming the spoils system.  The reform was supported by President Arthur, shocking his critics.  The Pendleton Act of 1883 made mandatory campaign contributions from federal employees illegal, and it established the Civil Service Commission to make appointments to federal jobs on the basis of merit.  The civil-service reform forced politicians to gain support and funds from big-business leaders.


The Blaine-Cleveland Mudslingers of 1884

The Republicans chose James G. Blaine as their presidential candidate for the election of 1884.  The Democrats chose Grover Cleveland.  Grover Cleveland was a very honest and admirable man.  Cleveland won the election of 1884.


"Old Grover" Takes Over

Cleveland was the first Democrat to take over the presidency in 28 years. He replaced thousands of federal employees with Democrats.

Cleveland believed that while the people support the government, the government should not support the people.


Cleveland Battles for a Lower Tariff

The Treasury was running a budget surplus due to revenue generated by the high tariff that was enacted during the Civil War. To reduce this surplus, President Cleveland convinced Congress to lower the tariff in 1887. The Republicans opposed lowering the tariff because they thought it would hurt businesses.

The Republicans chose Benjamin Harrison as their presidential candidate for the 1888 election.  The Republicans made tariffs an issue for the election of 1888. Cleveland won the popular vote, but Harrison still won the election.


The Billion-Dollar Congress

The Republican Speaker of the House, Thomas B. Reed, took control of the House and used intimidation to get Congress to pass several debated bills. The Billion-Dollar Congress, named for its lavish spendings, gave pensions to Civil War veterans, increased government purchases on silver, and passed the McKinley Tariff Act of 1890. This significantly raised tariffs and financially hurt farmers. Farmers were forced to buy expensive products from American manufacturers while selling their own products into the highly competitive world markets.

The McKinley Tariff Act caused the Republican Party to lose public support and lose their majority in Congress in the congressional elections of 1890.


The Drumbeat of Discontent

The People's Party, or "Populists," formed from frustrated farmers in the agricultural belts of the West and South. They called for a graduated income tax; government ownership of the railroads, telegraph, and telephone; the direct election of U.S. senators; a one-term limit on the presidency; the adoption of the initiative and referendum to allow citizens to shape legislation more directly; a shorter workday; and immigration restriction.

The Populists nominated General James B. Weaver for the presidential election of 1892.

In 1892, a series of violent worker strikes swept through the nation, including the Homestead Strike.

The Populist Party did not win the election.  One of the main reasons was that the party supported the black community.  The party's leaders, such as Thomas Edward Watson, felt that a black man had a right to vote.  The party counted on many black votes from the South, but many Southern blacks were denied the right to vote through literacy tests and poll taxes.  The Southern whites voted against the party because of the party's equal rights views toward blacks.


Cleveland and Depression

Grover Cleveland again ran for president in the election of 1892 and won, beating out the Populist Party and the Republican Party.

The panic of 1893 was the United States' worst economic depression in the 1800s.  It was caused by overbuilding, over-speculation, and the agricultural depression.

The Sherman Silver Purchase Act of 1890 was created by Benjamin Harrison, and it forced the government to purchase a certain amount of silver every month. Indebted farmers pushed for the Act because they wanted to cause inflation so they could pay off their debts with cheaper money. People started to exchange their silver for gold from the government. An increase in silver production lead to a significant drain on the Treasury's gold reserves, which decreased confidence in the country's finances. Because of this, Cleveland was forced to repeal the Sherman Silver Act Purchase in 1893.

J.P. Morgan lent the government $65 million in gold to increase the Treasury's reserve.


Cleveland Breeds a Backlash

The Wilson-Gorman Tariff of 1894 lowered tariffs and added a 2% tax on incomes over $4,000.  The Supreme Court ruled income taxes unconstitutional in 1895.

The embarrassment over the Wilson-Gorman Tariff caused the Democrats to lose seats in Congress, giving the Republicans an majority in Congress.

Grant, Hayes, Garfield, Arthur, Harrison, and Cleveland were known as the "forgettable presidents."


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