Grant was noncommittal but seemed to approve. Gould was satisfied.
By the middle of September, while Fisk and Gould were buying as much gold as they could—it was selling at about $134 an ounce—Horace Greeley and a few others became suspicious of what Greeley called a conspiracy at the Gold Exchange Bank, the clearinghouse for gold brokers, located on the corner of Broad Street and Exchange Place. There was excitement in the Gold Room, in the middle of which was a large fountain of a Cupid holding a dolphin. The price of gold was climbing; it had risen to $138, then to $140. That was what Gould had wanted. But worrying that Grant might change his mind and sell off more gold, he persuaded Corbin to write the president to remind him of their earlier conversation about not depressing the market.
On vacation with his wife in western Pennsylvania, Grant received the letter, read it, and told the messenger, who had delivered it in person, that everything was all right; yes, he had read the letter. “Letter delivered all right,” the messenger wired New York. The telegraph operator sent a slightly different version of what Grant had said: “Letter received. All right.”
Gould understood the reply to mean that Grant had agreed not to put any more gold onto the market. But Grant, learning that Corbin had sent the letter by special messenger, had grown suspicious. He made his wife write to his sister. “Tell your husband that my husband is very much annoyed by your speculations,” she said. “You must close them as quick as you can!” Corbin was continuing to buy. The price had reached $162 an ounce by eleven in the morning on that sunny day, September 24, soon to be known as Black Friday. The price kept shooting upward. Fisk kept buying. Brokers crowded into the Gold Room.
When Corbin received the letter Julia Grant had written his wife, he showed it to Gould, and Gould, smart man that he was, secretly began to dump much of his gold. By then, frantic telegrams had been reaching Washington about the hysterical surge in the price. Back in Washington the night before, Grant had sprung into action. Finally, he had seen the whole fraud clearly. Conferring with Boutwell, the president had ordered him to sell $4 million worth of gold the next day if the price continued to climb.
When Boutwell’s telegram arrived at the Gold Room, the price dipped to $133 in a matter of minutes as investors hurried to get rid of their gold stock and then splashed water from the fountain onto their burning foreheads. Foreign trade virtually came to a standstill. Stocks fell as much as 50 percent in some cases. Several banking houses had to suspend payments. Men wept; one man fainted, and at least one man killed himself. The streets around the Exchange were blocked off, but Jay Gould still made $11 million.
“Wall Street still panting,” noted George Templeton Strong a few days later, “like a man convalescing from tetanus, or delirium tremens.” Strong and others blamed the shifty Fisk, who after the price of gold plunged couldn’t show his face on Wall Street without risking bodily harm and hid in the Opera House at 23rd Street. Butterfield resigned from the subtreasury. Gould and Fisk hired excellent lawyers who argued their case in front of bribed judges.
George Templeton Strong did not blame Fisk or Gould alone. He blamed the “Railroad Kings” and other “Vikings of the stock market,” as he called them, who had already been involved in widespread and runaway speculation. He also believed, as did the Adams brothers, Henry and Charles Francis, that the railroads had grown too big, too corporate, too monolithic, too capable of trampling on “law, custom, decency, and every restraint known to society,” as Henry Adams put it, “without scruple, and as yet without check.”
Congress investigated. There were no reprisals.
Something had to be done. Many scandalized Republicans decided that Grant was not the man to do it.
Certainly Charles Sumner didn’t think Grant up to that or any other task. Brimming with wounded self-regard, the dignified if arrogant Sumner had been terribly insulted when Grant had not consulted him about his choice for secretary of state. And that insult had barely concealed the profounder and festering injury of Grant’s not having appointed Sumner himself to that or any other cabinet post.
Hamilton Fish, the man Grant did finally name (after one person left the post and another declined), was a very capable man and a good choice. But Sumner, who had been passed over twice and who learned that several diplomatic appointments would not be going to his friends, at least had been able to secure the appointment of John Lothrop Motley, the writer and diplomat, as ambassador to the Court of St. James’s. That was especially important to Sumner, who wanted Great Britain to pay war reparations. Despite claiming neutrality, the British had indirectly sustained the Confederacy by building and outfitting such ships as the Alabama, which had captured fifty-eight Union merchant ships. The British had therefore prolonged the war, claimed Sumner, and had cost the United States more than $2 billion.
The so-called Alabama claims galled the British government. Sumner was “a Fanatic,” said his friend the Duchess of Argyll, “and never did see more than one side, which was well enough when he had to fight the deviltry of American Slavery.” The British foreign secretary, the experienced Lord Clarendon, thought Sumner was breathing the “most extravagant hostility to England.” Fortunately, Clarendon’s son, who had just been visiting the United States, told his father that Sumner’s saber rattling meant very little; in America, he said, “nothing but money making is really cared about.” Prime Minister William Gladstone was satisfied for the time being; not only was Sumner’s bark worse than his bite, he was a “man of huge and distempered vanity.”
Unrealistic as well as overbearing, Sumner was hoping that as restitution the British might offer to hand over Canada. Certainly he wasn’t opposed to extending the U.S. boundary northward. More to the point, though, was his need to assert himself as the man directing U.S. foreign policy. It’s true that both Grant and Secretary of State Fish would have liked an apology from Great Britain, a reexamination of international law, and the gift of Canada. But Grant was preoccupied with the Caribbean. In Cuba, insurgents were rebelling against Spanish rule. Refugees were flocking into Florida with stories of horror. With his faithful friend the tubercular John Rawlins as secretary of war and his moral compass, Grant considered aiding the rebels. But since intervention might seem similar to what the British had done with the Confederates, Grant realized he could not assist or even recognize the Cuban insurgents.
With Rawlins’s tuberculosis worsening and then his untimely death in September 1869, and with Hamilton Fish urging reconciliation with Spain, Grant looked toward Santo Domingo (today’s Dominican Republic). Though not an expansionist per se, he did recognize the island’s favorable location, both commercially and militarily: Samana Bay, for instance, could serve as a port for ships on their way to the Isthmus of Panama, and the country was rich in natural resources. Plus, it might welcome the black men and women of the South, where the Ku Klux Klan seemed to grow stronger daily. Men cloaked in long robes burned down homes and schoolhouses, they fired guns into the houses of the men who tried to stop them, and, if put on trial, they assassinated key witnesses. They hit, they ran, they used the guerrilla tactics they had honed during the war. Grant knew it, and he deplored it. As he later said, “What I desired above all, was to secure a retreat for that portion of the laboring classes of our former slave states, who might find themselves under unbelievable pressure.”
True, the idea of resettling black people in Santo Domingo was just another watered-down colonization fantasy—the fantasy that first slavery and now its aftermath could be swept under the rug. Still, the idea appealed to Grant for another reason: the island could become a beacon of freedom for Cuba, where slavery, under Spanish rule, was still legal. As unrealistic about annexing Santo Domingo as Sumner had been about annexing Canada, the president might also have been intrigued by what his biographer William McFeely called “the steamy pursuit of empire,” although it’s also possible that Grant’s purposes were more complex: that the emigration of black workers to Santo Domingo would push the South to recognize and
respect its black workforce.
Of course, Grant outlined the commercial reasons for annexation as they had been outlined to him by his shady personal secretary, Orville E. Babcock. An engineer and graduate of West Point (near the top of his class), the slim Babcock was affable and crafty. Grant believed him to be a dependable friend although Babcock more generally inspired little trust and far less admiration. But Babcock had Grant’s ear, he lived in the White House, and he had served Grant well during the war as his aide-de-camp. Babcock had been by Grant’s side at Appomattox, and Grant repaid loyalty, even to a fault.
Grant had sent Babcock, in the summer of 1869, to Santo Domingo to assess the feasibility of annexation. Accompanying him were two other shady American speculators, William L. Cazneau and Joseph W. Fabens. Those men, who owned a great deal of land in Santo Domingo and happened to be friends of Buenaventura Báez, Santo Domingo’s president, were motivated to find the island ready to be annexed. And they saw what they wanted to see. Grant was likely unaware of that when the enthusiastic Babcock returned to Washington with terms laid out in an early draft of a treaty, also called a protocol. Annexation would cost the United States $1.5 million, a sum to be applied to the Dominican national debt, and the promise of statehood.
Babcock’s trip and his negotiations with Báez had taken place without the knowledge of Congress, and Grant realized that nothing would go forward without the support of the chairman of the Senate Foreign Relations Committee. That man was Charles Sumner.
Grant and Sumner did not like each other. To Grant, Sumner was a puffed-up Boston prig taken with his own high-mindedness; when told that Sumner “had no faith in the Bible,” Grant slyly answered, “Well, he didn’t write it.” For his part, Sumner saw Grant as a boorish soldier whose brain had been dimmed by the smoke he inhaled from his ever-present cigar. And he had, of course, been too witless to have appointed Sumner to his cabinet.
But Grant respected and understood power, and so, on January 2, 1870, he took the unprecedented step of walking across Lafayette Square to knock on Sumner’s door. He was, he explained, asking for the senator’s support for the annexation treaty he was about to submit to the Senate. Grant thought the meeting had gone well, but what he did not understand was the senator’s carefully chosen send-off. Assuring Grant that he, Sumner, was “an Administration man, and whatever you do, you will always find in me the most careful and candid consideration”—or words to that effect—he closed the door on Grant. Rightly, he assumed that Grant would take the farewell as literally meaning that he would support the treaty—and Grant told his cabinet that Sumner would. The cunning senator had not however meant he would support the treaty; he hadn’t even bothered to read it yet, as he told his colleagues, and would never assent to approving something he had not seen.
Sumner wanted to defeat the president at all costs. (Already he had averted intervention in Cuba, which would have weakened his demand for war reparations from Great Britain.) Sumner stalled; then he investigated; then he spoke dramatically and at length against the treaty. Not only was the price of annexation too high—could the United States really afford such a purchase during these rocky economic times?—but, he hinted, Babcock was receiving favors from the Dominican dictator, whose faltering regime was being propped up by American money.
Sumner concluded that Báez and American speculators, not the Dominican people, were pushing for the treaty’s ratification, and he also surmised that annexation, if successful, wouldn’t stop with Santo Domingo. The speculator Fabens had foolishly confided as much to him. He and his fellow knaves were also hankering after Puerto Rico, Jamaica, Cuba, the Windward Islands—and the free black republic of Haiti. To Sumner, it was simply the filibustering banditry of yesteryear. He would have no part of it. The treaty was wicked. Of course, as the imposing senator added, President Grant was “entirely honest.” Sumner came to bury Caesar by praising him.
Though Grant supporters and Radical Republicans such as Zachariah Chandler fought Sumner, the annexation treaty failed to pass the Senate on June 30, 1870 (the Senate had divided 28 to 28, with Republicans joining Democrats). A tenacious man, Grant would not let it go. In retaliation against Sumner, he fired John Motley, and in his annual address to Congress, delivered the following December, he repeated again all the good reasons for annexation: Santo Domingo was rich in resources; its geographical position was important militarily; and if backed by a stable government (that of the United States), it would provide new markets for U.S. products. Annexation would help pay the national debt without overtaxing the American people. And unlike Mexico’s, the Santo Domingo government was actively and voluntarily seeking annexation; this was not an imperial takeover. The people of Santo Domingo “yearn for the protection of our free institutions and laws, our progress and civilization,” he declared. “Shall we refuse them?”
Not only that: again, he insisted that annexation would “settle the unhappy condition of Cuba and end an exterminating conflict.” Now Grant, unusual for him, was venturing into the realm of the quixotic. Workers would flock to Santo Domingo from neighboring islands, he said, to “seek the blessings of freedom and its sequence—each inhabitant receiving the reward of his own labor.” That was the truly idealistic, if credulous, reverie of a man branded, at times, a military martinet. “Porto Rico and Cuba will have to abolish slavery,” he went on, “as a measure of self-preservation, to retain their laborers.” Santo Domingo would also be able to give American blacks that which was being denied to them at home: “a free exercise of the elective franchise.”
Sumner was as stubborn as Grant. He too repeated his reasons for quashing the treaty. Báez was no friend to Haiti; beware his intentions and those of the United States, which would likely absorb Haiti, the only black republic in the world, whose weak and humble people, as Sumner called them, were glad the Senate had turned the treaty down. In fact, by pushing annexation, Grant was threatening Haiti in the same way Pierce and Buchanan had heartlessly intimidated Free Soil Kansans in the 1850s.
No president would want to be compared to Pierce or Buchanan, least of all one who had fought in the bloody war that they had helped, in their way, to bring about. But Sumner intended to hurt Grant—and at the same time deprive him of any claim to his own well-earned title as a defender of freedom and human rights.
Senator James Nye of Nevada took the Senate floor. At five foot ten and weighing two hundred pounds, the easygoing Nye was well liked by his colleagues and known for his learning, although Sumner thought his anecdotes coarse. He and Sumner sat next to each other at their mahogany desks. Now Nye castigated Sumner, saying he’d been shocked by the vitriol of Sumner’s attack. He turned directly to his colleague. “I lit my youthful candle at your lamp,” he said. “What are you doing? Why vilify the president?”
Sumner was not the only Republican slamming the president. Former Radicals were lining up against Grant—and against Radical Republicanism, despite Sumner’s continued commitment to it. They were tired of tales of bribery and fraud; they were disgusted by what they considered government expansion; they were wary of the black Republican legislators and unrest in the South. And Santo Domingo offered them an opportunity to rebuke the executive. Carl Schurz, recently elected senator from Missouri, argued against annexation. Also a member of the Foreign Relations Committee, Schurz took the floor on January 11, 1871. If the United States annexed Santo Domingo, the lean senator wanted to know, would Cuba be far behind? If we annexed Cuba, then why not Puerto Rico and every other West Indian island, and then everything down to the Isthmus of Darien? “The Anglo-Saxon race is somewhat notorious for its land hunger,” Schurz scoffed, “and such appetites are always morbidly stimulated by eating.”
It was not imperialism per se that turned Schurz’s stomach. Though the Senate had balked at Secretary of State Seward’s plan to purchase Alaska in 1867, its hesitation had then come mainly from those who hated anything Andrew Johnson and his administration wanted to do. Sumner himself was an expansi
onist, and though he felt Seward had sprung the Alaska deal on him, he had endorsed the acquisition. And he had published a monograph in The Atlantic Monthly, “Prophetic Voices About America,” to hail the U.S. empire. He quoted Bishop George Berkeley (“that empire is traveling westward”), John Adams (“Canada and Nova Scotia must be ours”); the Spanish diplomat Count d’Aranda (“the day will come when it will become a giant, even a colossus formidable”). Flanked by such company, Sumner concluded that, in time and with peace, “the name of the Republic will be exalted, until every neighbor, yielding to irresistible attraction, will seek a new life in becoming part of the great whole; and the national example will be more puissant than any army or navy for the conquest of the world.” In other words, everyone is welcome to join the United States, except Santo Domingo.
Sumner’s friend Schurz provided an argument different from Sumner’s against the annexation of Santo Domingo, one that reflected his disillusion with Reconstruction. If you annex these tropical countries, he pointed out, you’ll have to incorporate their people—black people—and those black people are not “quite compatible with the integrity, safety, perpetuity, and progressive development of our institutions.” He continued, “Show me a single instance in any tropical country where labor when it was left free did not exhibit a strong tendency to run into shiftlessness, and where practical attempts to organize labor did not run in the direction of slavery.” The tropics, his argument went, were similar to the American South; annex them, and you would have another South on your hands and another shiftless population, which is what he was implicitly calling American blacks.
The spirited Republican senator from Indiana, formerly its war governor, was Oliver Perry Morton, the son of a shoemaker. An antislavery Unionist who had been partly paralyzed by a cerebral hemorrhage in 1865, he had been converted to Radical Republicanism—some critics thought his conversion a gesture of political opportunism—and had helped secure the ratification of the Fifteenth Amendment in Indiana. Pointedly, he asked Schurz an elemental question: Weren’t Schurz’s arguments the same proslavery ones made for fifty years before the abolition of slavery? Brushing aside the question, Schurz claimed no knowledge of that. He would not budge. Anglo-Saxon vigor might be more powerful than that of the “mixed Latin, Indian, and African races,” but since those mixed races are indigenous to tropical soil, imagine what would happen to the poor Anglo-Saxon in that climate: soil and shiftlessness would absorb the alien Anglo-Saxon in “assimilation downward.” Thus had Darwin entered the conversation.
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