Chapter 23.1
[POLITICAL PARALYSIS IN THE GILDED AGE 1869-1896]
The "Bloody Shirt" Elects Grant
The Republicans nominated General Grant for the presidency in 1868. The Republican Party supported
the continuation of the 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. On "Black
Friday," September 24, 1869, the two bought a large amount of gold, planning to sell it for a profit. In
order to lower the high price of gold, the Treasury was forced to sell gold from its reserves.
"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
In addition to members of the general public being corrupt, members of the federal government also
participated in unethical actions.
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,
earning high dividends. When it was found out that government officials were paid to stay quiet about the
illicit business, some officials were censured.
The Liberal Republican Revolt of 1872
In response to disgust of the political corruption in Washington and of military Reconstruction, the Liberal
Republican Party was formed in 1872.
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 disabilities 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-speculating was the primary cause to the panic of 1873; too much expansion had taken place. 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.
Due to popular mistrust of illegitimate dealings in the government, inflation soon depreciated the value 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 Treasury began to accumulate gold stocks against the appointed day for the continuation of metallic
money payments. This policy, along with the reduction of greenbacks, was known as "contraction."
When the Redemption Day came in 1879 for holders of greenbacks to redeem the greenbacks for gold,
few did; the greenback's value had actually increased due to its reduction in circulation.
The Republican hard-money policy had a political backlash and 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 era by Mark Twain)
the political parties in government had balanced out.
Few significant economic issues separated the Democrats and the 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 the moral affairs of society. They were found in the
Chapter 23.1
[POLITICAL PARALYSIS IN THE GILDED AGE 1869-1896]
Midwest and Northeast. Many Republican votes came from the Grand Army of the Republic, a
politically active fraternal organization 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.
A "Stalwart" faction led by Roscoe Conkling supported the system of swapping civil-servant jobs for
votes. (Giving someone a job if they vote for a specific party/cause. "Spoils system") Opposed to the
Stalwarts were the Half-Breeds, led by James G. Blaine. The main disagreement between the two
groups was over who would give the jobs to the people who voted in their favor.
The Hayes-Tilden Standoff, 1876
Congress passed a resolution that reminded the country, and Grant, of the two-term tradition for
presidency after Grant was speculating about 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 was 1 vote shy from winning in the Electoral
College. The determining electoral votes would come from three states, Louisiana, South Carolina, and
Florida who had each sent two sets of ballots to Congress, one with the Democrats victorious and the
other with the Republicans victorious; there was no winner in these states.
It was necessary to find the true political party winner of the states, although it was unknown who would
judge the winner of the states because the president of the Senate was a Republican and the Speaker of
the House was a Democrat.
The Compromise of 1877 and the End of Reconstruction
The Electoral Count Act (Compromise of 1877), passed by Congress in 1877, set up an electoral
commission consisting of 15 men selected from the Senate, the House of Representatives, and the
Supreme Court. It was made to determine which party would win the election. The committee finally
determined, without opening the ballots from the 3 disputed states, that the Republicans had been
victorious in the disputed ballots from the three states, giving the Republicans the presidency.
The Democrats were outraged at the outcome, but agreed that Republican 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 supposedly guaranteed equal accommodations in public places and
prohibited racial discrimination in jury selection. The Supreme Court ended up ruling most of the Act
unconstitutional, declaring that the 14th Amendment only prohibited government violations of civil rights,
not the denial of civil rights by individuals.