HY 104 Lecture Notes - Lecture 15: New-York Tribune, Whiskey Ring, Corporate Crime
29 May 2018
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The Crédit Mobilier Scandal
This booming railroad industry quickly attracted corporate corruption. In
the 1860s, corrupt Union Pacific Railroad executives had created a dummy
railroad construction company called Crédit Mobilier. The executives
contracted themselves out as tracklayers for the phony company and earned
huge profits, bribing several Congressmen and even Grant’s vice
president, Schuyler Colfax, to keep quiet about Crédit Mobilier’s unlawful
profiteering. In 1872, the scandal was exposed, and Colfax resigned. Again,
though Grant had not been knowingly involved in the scandal, he suffered a
major blow to his political reputation.
The Whiskey Ring Scandal
Two years later, in 1874, Grant was hit by yet another scandal when several
federal employees whom he had appointed embezzled millions of dollars of
excise tax revenue. The president vowed to hunt down and punish all those
involved in the Whiskey Ring but was forced to eat his words when he
discovered that his own personal secretary was involved in the ring. Although
Grant ended up pardoning his secretary, the Whiskey Ring left yet another
stain on his presidency.
The Liberal Republican Party
Fed up with scandals in the Grant administration, a significant number of
Republicans broke ranks with the radicals and moderates in Congress before
the 1872 presidential elections, forming a breakaway party called the Liberal
Republican Party. These congressmen wanted to put an end to
governmental corruption, restore the Union, and downsize the federal
government.
The Liberal Republicans were largely businessmen, professionals, reformers,
and intellectuals who disliked big government and preferred a laissez-
faire economic policy. Some historians argue that the Liberal Republicans
find more resources at oneclass.com
find more resources at oneclass.com
Document Summary
In the 1860s, corrupt union pacific railroad executives had created a dummy railroad construction company called cr dit mobilier. The executives contracted themselves out as tracklayers for the phony company and earned huge profits, bribing several congressmen and even grant"s vice president, schuyler colfax, to keep quiet about cr dit mobilier"s unlawful profiteering. In 1872, the scandal was exposed, and colfax resigned. Again, though grant had not been knowingly involved in the scandal, he suffered a major blow to his political reputation. Two years later, in 1874, grant was hit by yet another scandal when several federal employees whom he had appointed embezzled millions of dollars of excise tax revenue. The president vowed to hunt down and punish all those involved in the whiskey ring but was forced to eat his words when he discovered that his own personal secretary was involved in the ring.
