Harrison, Cleveland (again), and the Populists in 1892

AP US Unit 10 – Chapter 28.1With help from Susan Pojer

1888 Presidential Election1888 Presidential Election

Benjamin Harrison

• Harrison (R) was elected in 1888. • The Republicans were quite happy and put

Blaine in as secretary of state and a young Teddy Roosevelt as part of the Civil Service Commission.

• Republicans did have a slim lead of only 3 votes.

– Democrats kept filibustering and calling for quorum votes

• Until Speaker of the House, Thomas B. Reed, the Czar, began to ignore them

Dealing with the Surplus

• Harrison wanted to get rid of the high tariff surplus without getting rid of the tariff

• He increased payments to veterans

– From $81 million to $135 million

Consequences of Billion Dollar Congress

• Paved the way for more government help to the people in the 1900’s

• Secured GAR votes for the GOP (hah!)• Helped secure the high tariff because the

money was necessary to pay the veterans

Dealing with Western Democrats

• Sherman Anti-Trust Act of 1890– Did little, but was a first

• Sherman Silver Purchase Act of 1890– Doubled minimum purchase of silver from

Blaine-Allison Law (to about all the silver that was being mined)

– Made farmers, who wanted inflation, happy• Eastern Gold Bugs supported silver to keep

the tariff and Western farmers supported the tariff to get the silver!

The Tariff (it’s back!)• Increased the rate of the protective tariff with the

McKinley Tariff Bill of 1890– 48%!!!– Also gave American sugar growers a bounty of 2 cents a

pound– New duties saw an increase in prices of manufactured

goods for farmer• Often from Democrats creating hype against the tariff

• So much hatred rose against the Republicans that there was a congressional turnaround in 1890 when the Republicans went from 166 to 88 seats in the house and the Democrats had 235.

– 9 of the Democrats were members of the Farmers’ Alliance

Populists and the Election of 1892

• The farmers’ movement that began with the Grange and the Farmers’ Alliances grew into a strong political party called the Populists

• In the election of 1892:– The Republicans ran the much disliked

President Harrison– The Democrats ran former President

Cleveland– The Populists ran a Greenbacker – General

James B. Weaver

1892 Presidential Election1892 Presidential Election

James Weaver Grover Cleveland Benjamin Harrison Greenback / Populist again! * (DEM) (REP)

Price Indexes for Consumer & Farm Products: 1865-1913

Price Indexes for Consumer & Farm Products: 1865-1913

Populist platform:• Free and unlimited coinage of silver at a 16:1

ratio• Graduated income tax• Government ownership of telephone,

telegraph, and railroads• Direct election of Senators• One-term limit on the Presidency• Use of initiatives and referendums• 8-hour workday• Immigration restrictions

– (the last two were to attract labor votes)

Growth of Populism

• Populist movement was fueled by two large strikes in the summer of 1892

– Homestead (Carnegie’s steel plant)• Brought in Pinkertons and then national troops to

put down the strike

– Coeur d’Alene silver miner strike in Idaho• Also brought down by federal troops

1892 Presidential Election1892 Presidential Election

Results of 1892• Cleveland won again – the only person to be RE-

elected after defeat• Populists got over a million votes (22 electoral) from

the Midwest and west. – Only 3rd party to be a MAJOR player– Didn’t get poor white vote in the South because the

Populists were trying to woo black farmers• Major blow to black voters in the South as this was

the year that the final Jim Crow nail was put into black voting

– Grandfather laws exempted those who had ancestors that voted in 1860 from poll taxes and literacy tests

– Oddly enough the Populists became more racist after this

Depression of 1893 • Lasted for approximately 4 years• Most devastating economic downturn of the

century• First large scale depression of the urban and

industrial age– Brought much hardship to the urban poor

• Caused by:– Overbuilding– Overspeculation– Labor disorders– Agricultural depression– Reduced American dollar because of free-silver

• Sound familiar?

Causes of the 1893 PanicCauses of the 1893 Panic

Began 10 days after Cleveland took office.

1. Several major corporations went bankrupt.

Over 16,000 businesses disappeared.

Triggered a stock market crash.

Over-extended investments.

2. Bank failures followed causing a contractionof credit (nearly 500 banks closed)

3. By 1895, unemployment reached 3 million.

Americans cried out for relief, but the governmentcontinued its laissez faire policies!!

Here Lies ProsperityHere Lies Prosperity

The Government and the Depression of 1893

• Government took the typical “wait and see approach” of the time

• Cleveland did have to act to staunch the bleeding of gold from the Treasury

– Under the Sherman Silver Purchase Act, the Treasury had to issue notes for the silver it bought. Owners of the paper currency would exchange it for gold. But then the notes had to be reissued and the process would begin again.

– The Treasury dipped below $100 million of gold – the safe line

– Cleveland called for an extra session of Congress in the summer of 1893 to repeal the Sherman Silver Purchase Act

• Even though silverites like 33-year-old congressman from Nebraska, William Jennings Bryan, spoke against it – the repeal passed

The Government and the Depression of 1893

• Also it was good Cleveland didn’t die when having emergency surgery to remove a mouth tumor because his VP (Adlai Stevenson) was a soft money guy

• By February of 1894, the US was on the verge of going off the gold standard as gold reserves sank to $41 million

– Because other currency was still being exchanged– Would cause an unstable economy

What could Cleveland do to stop the flood?

• Sold government bonds for more than $100 million in gold

• Worked out a deal with JP Morgan for a $65 million loan

– ½ of the gold would be from abroad– Would take the “necessary steps” to fill the holes in the

Treasury– Paid Morgan $7 million commission

• These measures reassured the economy but freaked out the silverites and those who thought the government was selling out

Coxey’s Army

• Marched on Washington DC demanding relief for unemployment through a federal works program financed by $500 million in legal tender notes

– Got arrested for walking on the grass– Like the Great Depression

Pullman Strike

• Pullman’s workers struck over huge wage cuts without rent cuts

• Governor of Illionis felt that the paralysis caused by Debs’ American Railway Union’s support of the strike, and therefore lack of use of Pullman Cars, was acceptable

– Obviously Governor Atgeld (who had pardoned the remaining Haymarket prisoners) was a friend of labor.

Pullman Strike• Attorney General Olney

was anti-labor and brought out federal troops against the strikers because they were interfering with mail delivery

– Cleveland supported this

• First OBVIOUS use of government and business collaboration against unions

– Imprisonment helped Debs become a socialist

The Tariff…gets worse!

• The McKinley Tariff of 1890 had been designed, and did, keep the protection high and the surplus low.

– Too high and too low – the Treasury was running out of funds

• By 1894 Congress was trying to create a new tariff, but because of pork it ended up:

– Bringing the tariff only from 48% to 41%– Sugar benefits worth $20 million a year– Income tax on incomes over $4000 – appeal to

the masses

The Tariff…gets worse!• Cleveland thought it was too little, but was

better than McKinley Tariff – at least it had the income tax

• The Supreme Court overturned the income tax in 1895 saying it violated Article 1 Section 9 paragraph 4 – no direct tax

– Changed with the 16th amendment in 1913 allowing an income tax

• People were angry and though the courts only supported big business

1894 Mid-Term Elections 1894 Mid-Term Elections Populist vote

increased by40% in the mid term-election year,1894.

Democratic party losses in the West werecatastrophic!

But, Republicanswon control of the House.

The Tariff…gets worse!

• The midterm elections went to the Republicans because so much frustration was put on the Democrats for the lame tariff

• Republicans thought they could nominate a nobody and still win the 1896 election

• Silverites were gaining ground and followers

– Especially with propaganda like Coin’s Financial School (1894)