When Congress met in December, Mr. Blaine, the Speaker, who had been one of the persons implicated by public rumor, although in fact he had refused absolutely to have anything to do with the transaction, left the Chair, and, calling Mr. Cox of New York to his place, introduced a resolution providing for an investigation of the affairs of the Union Pacific Railroad.

Two Committees were appointed. One, of which Judge Poland was Chairman, undertook to deal with the charges against the members of the House of Representatives. The other, of which Jeremiah M. Wilson of Indiana was Chairman, was directed to inquire into the entire management of the affairs of the Union Pacific Railroad and the Credit Mobilier. I was a member of this last Committee. A Committee was appointed also in the Senate, with direction to inquire into the charges so far as they affected Senators. The whole country was profoundly excited by the affair.

I stood third on the Committee on which I was a member. It was thought best that Mr. Wilson, the Chairman, who was a very able and distinguished lawyer, should go to Boston where the books of the Companies were kept, and make a searching examination of their books and accounts. Mr. Shellabarger of Ohio, the second member on the Committee, one of the ablest lawyers in the House, was in poor health. He consented to serve only on the condition that he should not be compelled to do any duty requiring any considerable labor. So I had to a large degree the charge of the investigation in Washington, where the witnesses were examined, and in the end the duty of preparing the report.

We did not deal in our report with the alleged misconduct of the individual members of the House, but solely with the two corporations. The report sets forth the transaction at length, and contains the following summary of the Committee's conclusions:

The purpose of the whole act was expressly declared to be "to promote the public interest and welfare by the construction of said railroad and telegraph line, and keeping the same in working order, and to secure the Government

21 VOL. I.

at all times, but particularly in time of war, the use and benefit of the same for postal, military, and other purposes.

Your committee cannot doubt that it was the purpose of Congress in all this to provide for something more than a mere gift of so much land, and a loan of so many bonds on the one side, and the construction and equipment of so many miles of railroad and telegraph on the other.

The United States was not a mere creditor, loaning a sum of money upon a mortgage. The railroad corporation was not a mere contractor, bound to furnish a specified structure and nothing more. The law created a body politic and corporate, bound, as a trustee, so to manage this great public franchise and endowment that not only the security for the great debts due the United States should not be impaired, but so that there should be ample resources to perform its great public duties in time of commercial disaster and in time of war.

This act was not passed to further the personal interests of the corporators, nor for the advancement of commercial interests, nor for the convenience of the general public, alone; but in addition to these the interests, present and future, of the Government, as such, were to be subserved. A great highway was to be created, the use of which for postal, military, and other purposes was to be secured to the Government "at all times," but particularly in time of

Your committee deem it important to call especial attention to this declared object of this act, to accomplish which object the munificent grant of lands and loan of the Government credit was made. To make such a highway, and to have it ready at "all times," and "particularly in time of war," to meet the demands that might be made upon it; to be able to withstand the loss of business and other casualties incident to war and still to perform for the Government such reasonable service as might under such circumstances be demanded, required a strong, solvent corporation; and when Congress expressed the object and granted the corporate powers to carry that object into execution, and aided the enterprise with subsidies of lands and

bonds, the corporators in whom these powers were vested and under whose control these subsidies were placed, were, in the opinion of your committee, under the highest moral, to say nothing of legal or equitable obligations, to use the utmost degree of good faith toward the Government in the exercise of the powers and disposition of the subsidies.

Congress relied for the performance of these great trusts by the corporators upon their sense of public duty; upon the fact that they were to deal with and protect a large capital of their own which they were to pay in money; upon the presence of five directors appointed by the President especially to represent the public interests, who were to own no stock; one of whom should be a member of every Committee, standing or special; upon the commissioners to be appointed by the President, who should examine and report upon the work as it progressed; in certain cases upon the certificate of the chief engineer, to be made upon his professional honor; and lastly, upon the reserved power to add to, alter, amend, or repeal the act.

Your committee find themselves constrained to report that the moneys borrowed by the corporation, under a power given them, only to meet the necessities of the construction and endowment of the road, have been distributed in dividends among the corporators; that the stock was issued, not to men who paid for it at par in money, but who paid for it at not more than thirty cents on the dollar in road making; that of the Government directors some of them have neglected their duties and others have been interested in the transactions by which the provisions of the organic law have been evaded; that at least one of the commissioners appointed by the President has been directly bribed to betray his trust by the gift of $25,000; that the chief engineer of the road was largely interested in the contracts for its construction; and that there has been an attempt to prevent the exercise of the reserved power in Congress by inducing influential members of Congress to become interested in the profits of the transaction. So that of the safeguards above enumerated none seems to have been left but the sense of public duty of the corporators.

The Judge Poland Committee investigated the conduct of the members who were suspected and acquitted all but two. The House accepted their decision. They recommended the expulsion of Mr. Ames and of James Brooks, one of the Democratic members. There were some special circumstances in the case of Brooks, which it is not necessary to recite. Brooks died before a vote on his case was taken. The House by a majority amended the resolution reported by the Committee in the case of Mr. Ames, and recommended a vote of censure, which was passed. Ames felt the disgrace very keenly, and did not live very long afterward.

These disclosures did much to bring about the uneasy condition of the public mind which led to the Republican defeat in the election of members of the House of Representatives in the fall of 1874, and brought Tilden so near to an election in 1876.

But it may fairly, I think, be said for the majority of the Republican Party in both houses of Congress, and the majority of the Republican Party in the country, that they did their very best to deal firmly and directly with any fraud or wrongdoing that came to light, even if their own political associates were the guilty parties. The political atmosphere has been purified as compared with the condition of those days. The lobbyist is not seen in the Committee Room or the Corridor of the Capitol, as was the case when I entered Congress in 1869. I ought perhaps to say that I think the acquittal of Belknap on the ground that the Senate has no jurisdiction to render judgment against a civil officer on process of impeachment after he has left office, was influenced by political feeling. I do not think most of the Republican Senators who voted that way would have so voted if the culprit had been a Democrat. But there were many able lawyers who thought the opinion of these Senators right.

CHAPTER XXIII

THE SANBORN CONTRACTS

THE forty-second Congress, at its second session, repealed all laws which provided for the payment of moieties, or commissions, to informers, so far as related to internal revenue taxes. But a provision was inserted by the Conference Committee, which attracted no attention, providing that the Secretary of the Treasury might employ not more than three persons to assist the proper officers of the Government in discovering and collecting any money belonging to the United States whenever the same might be for the interest of the United States. The Secretary was to determine the conditions of the contract, and to pay no compensation except out of money recovered. No person was to be employed who did not file a written statement, under oath, stating the character of the claim under which the money was withheld or due, and the name of the person alleged to withhold the same.

Under this law John D. Sanborn of Massachusetts, an active supporter of General Butler, applied for a contract which he obtained on the 15th of July, 1872, for the collection of taxes illegally withheld by thirty-nine distillers, rectifiers and purchasers of whiskey. He was then himself an employee of the Government as Special Agent for the Treasury Department. Secretary Boutwell being then absent or otherwise unable to attend to his duties, this contract was signed by Assistant Secretary William A. Richardson. Sanborn had already been employed to work up certain whiskey cases for which he had been paid $3,000 by the Government, and these cases were included in the foregoing contract.

On the 25th of October, 1872, Sanborn made application to have added to his contract the names of 760 persons,