History of Buchanan County, Iowa, with illustrations and biographical sketches, Part 132

Author: Williams bros., Cleveland, pub. [from old catalog]; Riddle, A. G. (Albert Gallatin), 1816-1902
Publication date: 1881
Publisher: Cleveland, Williams brothers
Number of Pages: 574

USA > Iowa > Buchanan County > History of Buchanan County, Iowa, with illustrations and biographical sketches > Part 132

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REMOVAL OF THE FLATHEADS.

În the vacation of the summer of 1872, General Gar- field went on a mission to the Indian country, by ap- pointment of the executive.

The Flatheads, occupying the valley of the Bitter Root, or Snake river, had long refused to comply with their engagement to remove to a new reservation, some hundred miles distant. With his characteristic thorough- ness, he began with Lewis and Clarke's expedition, and read up all the literature on the Indian question. He started in May, this threader of the intricacies of bud- gets, accompanied by the companion of his European tour, and sweet child, Mollie, whom he left at Leaven- worth, and himself staged the four hundred and fifty

miles between Salt Lake City and the Snake. The Flatheads were all Catholics, and numbered five or six hundred-a superior order of the natives, with some rudiments of civilization. There were plenty of stories of Lewis and Clarke, who were there more than sixty years before. He saw an elderly, intelligent half-breed, the reputed son of Captain Clarke, whose flame-red hair testified of the probability of the story. The general him- self visited the reservation and judged of its capacity and fitness for their residence. On his return he assembled the Indians and the agents, when after a two or three days' talk, two of the three chiefs assented to the terms he was authorized to offer, and he was thus able to ex- ecute his mission satisfactorily.

On their way back, at Chicago, he purchased a paper and there read the first account of the Credit Mobilier embroglio. He hurried on to Washington, made his re- port to the President on the thirteenth or fourteenth of September, and at once secured the publication of the statement of the facts he always made, and calmly awaited what time might unfold. Through all of the not quite forty-one years of his eventful life, this was the first whisper derogatory of his name. In the next part of my labors, the reader will find an exhaustive expose of this, and the other two charges which came upon him at about the same time, one of which grew out of his con- scientious discharge of his duties as the head of the com- mittee on appropriations, and another was calumniously connected with it.

Let no reader be deterred by the seeming length of what is offered him. He will there find all the original material from which he can form a satisfactory judgment of General Garfield's conduct, in all the cases referred to, and I have written thus far in vain, if I have not shown that the thus assailed man is fully entitled to have each of his countrymen examine and decide for himself, the merits of these charges.

A CHAPTER ON SLANDERS.

PART THIRD.

CHAPTER I.

A CHAPTER ON SLANDERS.

Credit Mobilier .- The Charge and How Met .- Union of Credit Mo- bilier with the Union Pacific .- Its Purpose and Plans .- Oakes Ames, Trustee, Places Ilis Stock, and How .- Suit and Exposure .- Garfield's Prompt Action .-- Bla ine Demands an Investigation .- The Committee .- Its Report Exonerates Garfield from Blame .- Leaves Him Exposed to Charge of Perjury .- Case Considered .- All the Evi- dence Given .- Ames Impeaches Himself .- Contradicted by His Pa- pers and Writings .- No Case .- Garfield's Statement. - Its Support. -Wholly Innocent.

Living and walking on a level above the heads of dealers in votes, caucus and convention managers, never having an acquaintance with the makers and workers of rings; surrounded by an atmosphere too raeified and cold for subsidists and lobbyists, the jobbers in congres- sional legislation; never having about him men of whom questions are asked and whose ways lie through the un- known, he was suddenly compelled to pass the ordeal of calumny, relentless as slander is, and come to appreciate the fugacious tenure of reputation, and be compelled to fall back, and in, upon himself.

The three charges, "Venal Dealing in Stock," "The DeGolyer Contract," and "Salary Grab," like three assaulting hosts, came upon him by surprise. Allies they were, each giving might to the others, though prob- ably had it not been insisted that he was vulnerable to the first, the other two would have been less fierce and persistent.

CREDIT MOBILIER.

The alleged stock transaction is supposed to have oc- curred late in 1867 or early in 1868. No assailant has been able, to fix its date. As we have seen, it transpired to the public, and took form, in the summer or autumn of 1872. This seeming cover of time and silence gave it added weight and wings. The charge involved many, each of whom had been regarded as unapproachable by corruption. The number involved, their high personal characters, in the curious illogic of the public mind dealing with charges upon men, gave it force and weight instead of doubt and improbability.

On the second day of the third session of the Forty- second congress, Mr. Blaine, whose name was on the list of the proscribed, acting by request of others, demanded an immediate investigation by the house, and a commit- tee of five was appointed, consisting of Luke P. Poland, Nathaniel P. Banks, George W. McCrary, William E. Niblack and William M. Merrick, all men ranking with the first of the body, and the two last among the ablest

of the representative men of the Democracy. After a patient and exhaustive hearing, in which all known sources of information were used in all the known and un- known ways of congressional investigations, the commit- tee having perfect jurisdiction of the case, unanimously exonerated Mr. Garfield. No man of the house before believed him guilty. No member has ever since given it credit, or will repeat the charge.

On the eighth of May, 1873, Mr. Garfield him- self gave a masterly expose of the case to the public, which seemed to clarify the atmosphere of all the color- ing matter that the committee left suspended in it. There is no silencing malice, or answering the scruples of aspiring rivals. They did not immediately die out. The year following was their apparent opportunity, and he was assailed in his own district, on all the charges. On the nineteenth of September, 1874, he invited friends and enemies to a discussion of all the charges, now boldly made upon him. That was the vital issue in his pending re-election. There, in a calm, colorless manner, clear and forceful, he distinctly stated each charge, and exposed and disproved it, calling upon any and all to answer or deny his statements or conclusions, giving them ample time for that purpose. No one undertook the hopeless task. The issues thus made his people adjudged in his favor, and from that no appeal has ever been made. It was taken as conclusive in the State, and reaffirmed by his unanimous nomination and election by the Re- publicans of the Ohio legislature to the senate of the United States. His recent national nomination is an af- firmation of the judgment of congress and of his own people.

During all the time of the congressional investigation, as during all the years since, men and women, the purest in the land, of lives the most elevated and blameless, men of the most exalted positions, of unquestioned integrity and. purposes, sought and associated with him, cultivated his society, gave him their trust, their love, and applause. They hailed his nomination as an omen, a pledge for the elevation of our politics, and the purifi- cation of our highest public and national life.

Against slander there is no plea of former acquittal; no statute of limitations is a bar ; no trust, no faith, no love however profound and universa! are the least protection against it. Every man, wherever he stands, however surrounded, is within reach, exposed to its shafts.

It may be said that the judgment of the house of rep- resentatives, of the State of Ohio, of a national conven- tion, do not bind the people of the Republic, and these questions of fraud and misconduct may be heard in the

₱

LIFE OF JAMES A. GARFIELD.

great forum. The charges are not now renewed because any intelligent man believes them, nor for the purpose of injuring the candidate as a man, but it is a means of war which may embarrass, possibly harm, political oppo- nents in a national contest for power, I will deal with this matter as a new question.

It is alleged that in December, 1867, or January, 1868, Mr. Garfield in effect corruptly purchased and held for some time, ten shares of stock of a corporate body, known as the Credit Mobilier, and that he real- ized by the transaction three hundred and twenty-nine dollars.

If there was fraud in this transaction it can be shown precisely where it resides, and the evidence can be pointed out that proves it. The stock itself must have been tainted, or there was fraud in the purchase, or the pur- pose of the acquisition was bad.

Some things need to be stated for a clear apprecia- tion of the case. The Union Pacific railroad company was chartered by congress. It received large subsidies of land to secure its construction. Congress promised a liberal loan of United States bonds, deliverable upon the completion of its sections. Should these prove inade- quate, the company was authorized to issue its own bonds, and to the extent of the insufficiency of the United States bonds, to pay for the construction; these con- struction bonds of the company were to be prior in security to the debt of the company to the United States for its bonds. The government of the United States ap- pointed two of the directors, and retained the right to annul the company's charter. These great advantages were secured to the company by act of congress of July, 1864. No further legislation was sought by the company. In 1859 Pennsylvania incorporated a company which afterward took the name Credit Mobilier from the French company of that name, with a capital of two million five hundred thousand dollars, which was afterward, by its own action, increased to three million seven hundred and fifty thousand dollars. Its declared purpose was to use its capital to aid the construction of great works of improvement the profits of the building of which would be dividends on its stock. Later, Thomas C. Durant, of New York, who was largely an owner and manager of the rail- road company and the Credit Mobilier, and Oakes Ames, of Massachusetts, who was also a stockholder in both com- panies, united their energies, genius, and means, for the construction of the road, the building up of the Credit Mobilier, and the enriching of themselves and associates, The means employed were by a contract, executed in August, 1867, between Oakes Ames and the Union Pa- cific, for the construction of six hundred and sixty-seven

miles of railroad for the sum of forty seven million nine hundred and twenty-five thousand dollars.

In October, 1867, another contract was made between Oakes Ames, the Credit Mobilier, and seven trustees, to whom Ames had assigned the contract for construction, by which the Credit Mobilier was to advance money to build the road at a rate of interest and commissions of nine and one-half per-cent. - All the leading holders of Union Pacific stock were holders of Credit Mobilier stock. To ensure the perpetual control of the Union Pacific, it was desirable that the seven trustees should hold perpetual proxies of the Union Pacific stock, and thus secure the direction of the company. To ensure this, the profits of the Ames construction contract were to be divided only among the holders of the Credit Mo- bilier stock, who, as holders of the Union Pacific stock, should deliver their proxies to the seven. All this is shown in Willson's (2d Cred. Mob.), Rep. No. 78, 42d Cong., 3d Ses.

It should be stated, that as in effect, the principal stockholders of the Union Pacific, thus contracted with themselves as the Credit Mobilier, to build the road, for which the bonds of the United States were to pay. It was at enormous profits, so great that the Credit Mobilier stock from below par in a few months was worth three or four times its par value, though none was ever in the market. This is apparent from both the Poland and Wilson reports. The case I am considering assumes that the dividends of the one thousand dollars of stock, paid for itself in five months, with a balance over of three hundred and twenty-nine dollars. Also, it should be remembered, that by this device, under the provision of the act of July, 1864, which permitted the Union Pacific to issue its own bonds, and give them priority in security over its debt to the United States for its bonds, it managed to displace them, and thrust in its own in advance of them, as first mortgage bonds. The Poland committee justly holds this to be a fraud upon the United States. Obviously terms and devices so extraor- dinary would be kept within the counsel of the conspir- ators. That it did not transpire to the world, and was not disclosed by Oaks Ames to the implicated members of congress, is the concurrent testimony of all the wit- nesses, and the unanimous finding of the Poland com- mittee.

In the autumn of 1867, there seem to have been six hundred and fifty shares of Credit Mobilier unsold, and some controversy arose between Durant, Amcs and Henry S. McComb, a large stockholder, as to their dis- position. Each claimed that he needed them to fill pro- mises to applicants. Ames was finally permitted to re-

A CHAPTER ON SLANDERS.

ceive three hundred and forty-three shares at par and in- terest from the preceding July. Thus armed Oakes Ames, a member of the house, made his peaceful way to the capital, on his mission of placing this stock, in accord- ance with the rule of his life, as stated in his letters found further on. He selected his depositaries with care, in every instance his political, and some of them, his personal friends, who had entire confidence in his business tact and honesty - men of nice integrity who would never be suspected, whom he could have had no wish to involve in difficulty, and neither of whom-he nor any man-would dream of approaching with a corrupt proposition. To each he sold or offered to sell at par, with interest from July. To no one did he disclose the relations of the two corporations, nor yet the enormous value of the stock. To assure some, he guaranteed a profit of ten per cent. Some paid him. Some did not. He was in- different about that. To not more than one, was the stock transferred. It stood in his name, he received the dividends, converted the bonds received and paid over, in a careless, pleasant way, as a man would, who had a secret, which some of them might blunder on, if each trans- acted his own business for himself. His transaction was with each separately. He told no one of his sales to either of the others, and each kept his own counsels. That there was no understanding between Ames and each of these men, nor between them as there would have been, had the purpose on their part been corrupt, is proved by the surprise and panic produced, when the real character of the arrangement was made known. Even then, there was no concert, save to demand a trial. Ames had a purpose. He did not desire further legisla- tion. The Union Pacific had not asked it. He was afraid that certain prominent men might ask impertinent questions in the house. He wanted silent, independent nfluence in different parts of the house. He did not intimate that he wanted it; did not disclose the real value of the commodity he was selling. That might lead to inquiries. Having planted his stocks, he wrote his letters of January 25th and 30th, and placidly pursued his peaceful way.

About the time of this stock-planting by Oakes, Mr. H. S. McComb planted a suit in the Pennsylvania courts against him, to recover these very shares, and time giving birth to other events, passed silently over both transac- tions. In the summer of 1872, the Pennsylvania case sprang into flower. McComb gave his deposition, and produced the following letters-reproduced before the Poland committee, where he testified :

WASHINGTON, January 26, 1868. H. S. McCOMB, EsQ .- Dear Sir: Yours of the twenty-third is at

hand, in which you say Senators Bayard and Fowler have written to you in relation to their stock. I have spoken to Fowler, but not to Bayard. I have never been introduced to Bayard, but will see him soon. You say I must not put too much in one locality. I have as- signed, as far as I have given, to four from Massachusetts; one from New Hampshire; one, Delaware; one, Tennessee; one-half, Ohio; two, Pennsylvania; one, Indiana; one, Maine; and I have three to place, which I shall put where they will do most good to us. I am here on the spot, and can better judge where they should go. I think after this dividend is paid we should make our capital four million dol- lars, and distribute the new stock where it will protect us. Let them have the stock at par, and profits made in the future. The fifty per cent. increase on the old stock I want for distribution here, and soon. Alley is opposed to the division of the bonds, says he will need them, &c., &c. I should think that we ought to be able to spare them with Alley and Cisco on the finance committee. We used to be able to borrow when we had no credit and debts pressing; we are now out of debt and in good credit. What say you about the Lond dividend? A part of the purchasers here are poor, and want their bonds to sell to enable them to meet their payment on the stock in the C. M. I have told them what they would get as dividends, and they expect, I think -when the bonds the parties received as the eighty per cent. dividend, we better give them the bonds. It will not amout to anything with us. Some of the large owners will not care whether they have the bonds or certificates, or they will lend their bond to the company, as they have done before, or lend them money. Quigley has been here, and we have got that one-tenth that was Underwood's. I have taken a half, Quigley a quarter, and you a quarter.

Judge Carter wants a part of it. At some future day we are to sur- render a part to him. Yours truly,

OAKES AMES.

WASHINGTON, January 30, 1868.

H. S. MCCOMB .- Dear Sir: Yours of the 28th is at hand inclosing copy of letter from, or rather to, Mr. King. I don't fear any investiga- tion here. What some of Durant's friends may do in New York can't be counted on with any certainty. You do not understand by your letter what I have done and am to do with my sales of stock. You say more to New York. I have placed some with New York, or have agreed to. You must remember that it was nearly all placed as you saw on the list in New York, and there was but about 6 or 8 M for me to place. 1 could not give all they wanted or they might want out of that. You would not want me to offer less than one thousand (MI) to any one. We allowed Durant to place $58,000 to some three or four of his friends or keep it himself. I have used this where it will produce most good to us I think.

In view of King's letter and Washburn's move here, I go in for making one bond dividend in full. We can do it with perfect safety. I understand the opposition to it comes from Alley. He is on the Finance Committee, and can raise money easy if we come short, which I don't believe we shall ; and if we do, we can loan our bonds to the Company, or loan them the money we get for the bonds. The contract calls for the division, and I say have it. When shall I see you in Washington ? Yours truly, OAKES AMES.

McComb sued Ames for this very stock, gave his de- position, and thus these letters transpired to the public, and produced wide-spread excitement. General Garfield was then in the Indian country, as will be remembered, and on his return first heard and saw them, on the thir- teenth or fourteenth of September. He immediately called upon his friend, Gen. H. V. Boynton, of the Cin-

LIFE OF JAMES A. GARFIELD.

cinnati Gasette, and authorized the following, which appeared in that print, September 15th :

"General Garfield, who has just arrived from the Indian country, has to-day had the first opportunity of seeing the charges connecting his name with receiving shares of the Credit Mobilier from Oakes Ames. He authorizes the statement that he never subscribed for a single share of the stock, and that he never received or saw a share of it. When the company was first formed, George Francis Train, then active in it, came to Washington and exhibited a list of subscribers, of leading cap- italists, and some members of congress, to the stock of the compan: . The subscription was described as a popular one of one thousand do !- lars cash. Train urged General Garfield to subscribe on two occasions, and each time he declined. Subsequently he was again informed that the list was nearly completed, but that a chance remained for him to subscribe, when he again declined, and to this day he has not subscribed for or received any share of stock or bond of the company."

The sittings of the Poland committee, as will be re- membered, were attended by excited crowds, and among the statements of the daily press were repeated accounts of the dismay of the gentlemen whose names appeared in Mr. Ames' list. The paragraph from the Gazette shows that none of these statements applied to General Garfield. Mr. Train's connection with the Credit Mo- bilier is apparent by other evidence. In his account of that company Mr. MeComb says:

"The Credit Mobilier corporation was the result of a charter ob- tained by a man named Duff Green, from the Pennsylvania legislature, called the ' Pennsylvania Fiscal Agency.' It was subsequently changed by legislative enactment to the Credit Mobilier of America, and some little change made in its provisions. It was purchased by Thomas C. Durant, from a man in Pennsylvania named Hall, and George Francis Train. It was purchased especially with a view of building the Pacific railroad. The Pennsylvania legislature made an amendment in the charter allowing a branch office to be in New York, and providing that it should be managed by what was called a railway bureau, all of whom need not be directors of the company."-Poland's Report, page 3.

Thomas C. Durant said-

Some parties were interested in this Pennsylvania fiscal agency when I first went into the Credit Mobilier. They had taken a few shares of stock before the branch was established in New York, under the amend- ed charter. 1 sent Mr. Train to Philadelphia. We wanted it for a stock operation, but could not agree what was to be done with it. Mr. Train proposed to go on an expanded scale, but I abandoned it. I think Mr. Train got some subscriptions; what they were I do not know; they were never collected and returned to the company .- Id. page 169.

The Poland committee was created by, and sat under, the following resolution :

Whereas, accusations have been made in the public press, founded on alleged letters of Oakes Ames, a representative from Massachusetts, and upon the alleged affidavits of Henry S. McComb, a citizen of Wil- mington, in the State of Delaware, to the effect that members of this house were bribed by Oakes Ames to perform certain legislative acts for the benefit of the Union Pacific railroad company, by presents of stock in the Credit Mobilier of America, or by presents of a valuable character derived therefrom: Therefore,

Resolved, That a special committee of five be appointed by the speaker pro tempore, whose duty it shall be to investigate whether any member of this house was bribed by Oakes Ames, or any other person or corporation, in any matter touching his legislative duty.

Resolved further, That the committee have the right to employ a stenographer, and that they be empowered to send for persons and papers .- Poland Reports, page I.

I: began its labors December 12th, and sat many weeks, filling over five hundred pages with the sworn statements of many men, chief of whom was the unhappy Oakes Ames. On the eighteenth of February the committee made its final report, written by the chairman.

The following is so much of this paper as deals with the charge against Mr. Garfield :

The facts in regard to Mr. Garfield, as found by the committee, are identical with the case of Mr. Kelley to the point of reception of the check for three hundred and twenty-nine dollars. Heagreed with Mr. Ames to take ten shares of Credit Mobilier stock, but did not pay for the same. Mr. Ames received the eighty per eent. dividend in bonds, and sold them for ninety-seven per cent., and also received the sixty per cent. cash dividend, which together paid the price of the stock and interest, and left a balance of three hundred and twenty-nine dollars. This sum was paid over to Mr. Garfield by a check on the sergeant-at- arms, and Mr. Garfield then understood this sum was the balance of dividends after paying for the stock. Mr. Ames received all the subse- quent dividends, and the committee do not find that, since the payment of the three hundred and twenty-nine dollars, there has been any com- munieation between Mr. Ames and Mr. Garfield on the subject until this investigation beg.n. Some correspondence between Mr. Garfield and Mr. Ames, and some conversations between them during this in- vestigation, will be found in the reported testimony. * *

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History of Buchanan County, Iowa, with illustrations and biographical sketches, Part 132

Author: Williams bros., Cleveland, pub. [from old catalog]; Riddle, A. G. (Albert Gallatin), 1816-1902 Publication date: 1881 Publisher: Cleveland, Williams brothers Number of Pages: 574

Author: Williams bros., Cleveland, pub. [from old catalog]; Riddle, A. G. (Albert Gallatin), 1816-1902
Publication date: 1881
Publisher: Cleveland, Williams brothers
Number of Pages: 574