The newspaper that broke the Credit Mobilier story occupies a unique place in the annals of American journalism. The New York Sun dawned in 1833 and immediately made a name for itself as a leading example of the “penny press” – a sales price that proclaimed its democratic aspirations and editorial orientation.

The four-page sheet edited by Benjamin Day showed little interest in the weighty matters that filled the columns of New York’s establishment dailies, Robert A. Rutland writes in The Newsmongers. “He pretty much ignored politics and business – everything the staid dailies found worthwhile – and turned to crime, humorous anecdotes, and short accounts of fires, runaway moving vans, and lesser fare.”

The editorial page masthead of the New York Sun.

Charles A. Dana took the reins in 1868. He supplemented the quotidian fare of the Sun with hard-hitting editorials and coverage of Washington that was not just aggressive but bordered on belligerent. Dana didn’t start out as a critic of the Grant administration – he had gotten to know and admire the general when he was assigned to keep tabs on Grant by Secretary of War Edwin M. Stanton – but quickly became one of the administration’s leading critics. By 1871, the Sun was referring to the president as “Useless S. Grant.”

“Charles Dana became obsessed with slinging mud at the president,” Janet Steele writes in The Sun Shines for All: Journalism and Ideology in the Life of Charles A. Dana.

The reasons for the Sun’s hostility were two-fold. Grant had spurned Dana’s application to win an important patronage job, customs collector of New York. But the sympathies of the working-class readership of the Sun did not lie with the Grant administration, and Dana wanted to stay on their side.

Dana was also something of an iconoclast. As a young man he had spent time at the utopian Brook Farm commune and had embraced the tenets of “producerism,” the economic theory that formed the basis of agrarian populism in later years. As managing editor of the New York Tribune he had hired Karl Marx as a European correspondent.

 

Currier and Ives lithograph from 1872 showing Charles Dana, lower right, joining foes of President Grant because “he would not make me collector for New York.” Library of Congress.

In 1872, Dana found himself in an odd position. His one-time boss, Horace Greeley, with whom he had a complex and often strained relationship, was running for president against Grant. Dana supported his ex-boss with tongue firmly planted in cheek, noting in early September how the “champion of the farmers” was taking leave of the agrarian masses during a visit to New York.

But Dana had something else he hoped would turn the tide against Grant and the Republican establishment: evidence unearthed from a Pennsylvania court that a Massachusetts congressman was selling shares in a valuable construction subsidiary of the Union Pacific to his colleagues in the hope of protecting the interests of the railroad on Capitol Hill.

When the Sun published its Credit Mobilier expose on Sept. 4, 1872, newspapers around the country were quick to pick up on the story, but the scoop did little to help Greeley, whose campaign was doomed from the start. Nevertheless, Dana’s scoop survived the election and became a political sensation when Congress returned to Washington in December. Over the course of the next several months, the Credit Mobilier affair dominated the headlines and rattled Washington as few scandals have done before or since.

The story of Charles Dana and the Credit Mobilier scandal is recounted in Congress and the King of Frauds: Corruption and the Credit Mobilier Scandal at the Dawn of the Gilded Age, by Robert B. Mitchell. Coming this fall from Edinborough Press.

In 1865, a Union Army veteran editing his hometown newspaper urged readers to get behind efforts to bring the railroad to Bloomfield, Iowa.

“Fellow citizens, these roads must be built! We have been disconnected from the live world for long enough,” James B. Weaver exhorted readers. “‘Rip Van Winkle’ must wake up!”

James B. Weaver during the war.

Less than thirty years later his views had changed dramatically. In early 1892, months before he became the Populist nominee for president, Weaver wrote in A Call to Action that the time had come for the government to operate the railroads for the benefit of the public.

“We have experimented through a lifetime of a whole generation and have demonstrated that avarice is an untrustworthy public servant, and that greed cannot be regulated or made to work in harmony with the public welfare. Like the carnal mind, it is enmity against the Laws of God and man and is not subject to the will of either, neither indeed can be.”

Weaver from A Call to Action.

Weaver’s evolution from a local booster of railroad development to a leading advocate of nationalizing rail transportation helps explain why the story of Credit Mobilier proved to be so powerful in the early 1870s.

The disclosures of the New York Sun coincided with the eruption of large-scale agrarian outrage with the business practices and corrupt influences of railroads, who seemed immune to political pressure. In the early 1870s, the Patrons of Husbandry, known more informally as the Grange, spread rapidly as farmers embraced the society as a vehicle for political action against the power of the railroads.

Historians point out that the Grange’s founders intended the organization to be strictly non-political. While it eschewed partisanship, the Grange brought farmers together on one question, according to an article that appeared in the Nebraska Advertiser of Brownville: “Is he liable to be bought by the railroads? In other words, is he the staunch loyal friend of the husbandman?”

While the sudden emergence of the Grange movement caught many (but not all — the Washington Evening Star published a prescient editorial on the Grange phenomenon at the height of the Credit Mobilier frenzy) it reflected rising discontent with the industry that was leading the transformation of the American economy into an industrial powerhouse.

In the late 1860s members of Congress from New York to Wisconsin denounced the power of the railroad industry in general and the Union Pacific in particular. Credit Mobilier was attacked on Capitol Hill in the months before the Union Pacific and Central Pacific joined in Utah to create a transcontinental railroad linking the Atlantic and Pacific coasts.

In aftermath of the congressional investigations into the scandal, Credit Mobilier became a symbol of political corruption with meaning across the political landscape. Democrats said it embodied what they considered the endemic corruption of Republican rule. The emerging “liberal” movement of the day believed it represented the corrosive effect of government involvement in economic development. Agrarian critics flocking to the Grange believed Credit Mobilier signified the larger story of political corruption fostered by railroads.

The alliance of Democrats and Liberal Republicans behind Horace Greeley had failed spectacularly in the presidential campaign of 1872. The agrarian uprising against the railroads, drawing its strength from long-held grievances, added new energy to the emerging consensus about corruption. The growing influence of concentrated wealth epitomized by the Credit Mobilier revelations caused many Americans to wonder whether government – at the federal or state level – could act disinterestedly on behalf of average citizens or was simply the captive of financial and corporate interests.

The aftermath of the Credit Mobilier scandal and its significance as a defining political event of the Gilded Age is one of the topics explored in Congress and the King of Frauds: Corruption and the Credit Mobilier Scandal at the Dawn of the Gilded Age, coming soon from Edinborough Press.

Representative James Brooks stood before his colleagues in the House, theatrically raised his right hand as if to take an oath, and declared:

“In the presence of God and in this House, and before the whole country, I swear that on no occasion, at no time whatsoever, for no man, have I ever used my influence or power in this body or elsewhere to add one cent of money or one farthing to my fortune.”

Rep. James Brooks. Library of Congress photo.

It was December 17, 1872. The committee led by Luke Potter Poland had just begun its closed-door investigation of the allegations made by the New York Sun that Representative Oakes Ames had distributed valuable shares of stock in a Union Pacific subsidiary named Credit Mobilier to members of Congress to protect the interests of the railroad.

Brooks was moved to make his histrionic declaration by published reports from the Poland committee linking him to the Credit Mobilier stock sales. The investigating committee had been told by Henry S. McComb, the chief witness against Ames, that Brooks had promised to use his influence with Democratic members of Congress in exchange for valuable shares of the Union Pacific subsidiary.

Brooks had been mentioned in passing by the Sun. But it wasn’t until he made his speech that the spotlight turned on him.

In the weeks to come there would not, in fact, be any indication that the New York Democrat had acted to promote Union Pacific interests. But the Poland committee found plenty of evidence that Brooks had indeed bought Credit Mobilier shares while serving as a government-appointed director of the Union Pacific.

This was a problem because the railroad’s government directors were not supposed to own stock in the Union Pacific. Buying Credit Mobilier shares violated the spirit, if not the letter, of that prohibition.

Brooks’s speech fell flat on the House floor and in the press gallery. None of his colleagues were moved to congratulate or cheer him at its conclusion. Journalist George Alfred Townsend, the son of a minister who wrote under the pen name “Gath,” found the invocation of God “rather blasphemous.”

It would not be the only time that Brooks miscalculated. Throughout the course of the Poland committee investigation, he demonstrated what the Sun described as a “fatuity unfathomable” in his efforts to defend himself. This may have been due to an advancing illness Brooks believed he had contracted while traveling to the Orient.

—

The story of Brooks’s ineffectual, occasionally bizarre, and ultimately tragic effort to defend himself is told in Congress and the King of Frauds: Corruption and the Credit Mobilier Scandal at the Dawn of the Gilded Age, coming this fall from Edinborough Press.

 

 

At the heart of the Credit Mobilier scandal lay a series of stock sales by Representative Oakes Ames, a Massachusetts Republican and financier heavily invested in the Union Pacific Railroad, to at least 11 members of Congress in the winter of 1867-1868. Ames sold Credit Mobilier shares at “par” – that is, at their starting sale price of $100 – to his congressional colleagues even though the stock by then was worth quite a bit more.

Restraint was not a distinguishing characteristic of 19^th-century journalism or politics. Reporters, editors and even congressmen spared no effort to paint the transactions in the darkest terms.

The New York Sun called them “colossal bribery.” Representative William Merrick of Maryland, one of the lawmakers on the lead committee investigating the Credit Mobilier sales, said Ames displayed “Satanic skill” in his dealings with his fellow members of Congress. Even the New York Tribune, relatively straightforward in its coverage of the scandal (especially compared to the dyspeptic Sun) said Ames “made the most serious mistake ever committed by a public man in our history.”

Rep. Oakes Ames. Library of Congress photo.

But Ames made no apology. “We wanted capital and influence,” he told an investigating committee led by Representative Luke Potter Poland of Vermont. “Influence not on legislation alone, but on credit, good, wide and a general favorable feeling.”

Was that bribery? Ames didn’t think so. The stock was sold to members who were already favorably disposed toward the Union Pacific. “If you want to bribe a man you want to bribe one who is opposed to you, and not to bribe one who is your friend.”

Nevertheless, he conceded, his motives weren’t entirely disinterested. Because the value of Credit Mobilier shares depended on the prosperity of the Union Pacific, he hoped to incentivize a cadre of congressmen to watch out for the railroad’s well-being in the legislative maelstrom of Capitol Hill. “I have found,” he told the Poland committee, “that there is no difficulty in inducing men to look after their own property.”

How Ames’s arguments fared in the House and the public at large is one of the subjects to be explored in “Congress and the King of Frauds: Corruption and the Credit Mobilier Scandal at the Dawn of the Gilded Age.” Ames was far from the only member of Congress whose actions regarding Credit Mobilier would come under scrutiny. In the days and weeks to come this blog will introduce many of the other figures implicated in the scandal.