9.5 The Grant Administration, Corruption & The Retreat from Reconstruction (1869–1876)

The Question This Section Answers

Why did the North abandon Reconstruction? The Compromise of 1877 is the conventional endpoint, but by then the outcome was already settled. The real answer lies in the years 1869 to 1876, in four converging developments: enforcement that worked and then stopped, scandal that discredited the government, depression that redirected northern politics, and a Supreme Court that dismantled the legal machinery.

Grant and the Klan: Enforcement That Worked

Ulysses S. Grant won in 1868 on the slogan "Let us have peace," and his first term produced the most vigorous federal civil-rights enforcement before the 1960s. The Ku Klux Klan, founded in Tennessee in 1866, had become the paramilitary arm of the Democratic Party across the South, using murder, whipping, and arson to suppress Black and Republican voting.

Congress responded with three statutes:

Grant used the power. In October 1871 he suspended habeas corpus in nine South Carolina upcountry counties, and Attorney General Amos Akerman's Justice Department — newly created in 1870 — brought roughly 3,000 indictments. Convictions were relatively few, but the arrests, flight, and prosecutions broke the first Klan by 1872 and produced the freest southern elections of the era.

That success is the strongest evidence that Reconstruction failed for want of sustained political will rather than for want of available means.

The Scandals

Grant was personally honest and a poor judge of associates. The scandals of his two terms became a byword.

• Black Friday (September 24, 1869): Jay Gould and James Fisk tried to corner the gold market using Grant's brother-in-law for access; Treasury gold sales broke the corner and wrecked many investors.
• Credit Mobilier (exposed 1872): Union Pacific insiders formed a construction company, awarded themselves inflated contracts, and distributed discounted shares to congressmen. Vice President Schuyler Colfax and Representative James A. Garfield were implicated; Colfax was dropped from the 1872 ticket.
• Salary Grab (1873): Congress voted itself a 50% raise retroactive two years, then repealed it after public fury.
• Whiskey Ring (1875): distillers and Treasury officials diverted millions in liquor excise taxes. Grant's private secretary Orville Babcock was indicted; Grant's deposition on his behalf helped secure an acquittal.
• Belknap (1876): Secretary of War William Belknap resigned minutes before impeachment for taking kickbacks on Indian trading-post appointments.

Corruption was not confined to Washington. New York's Tweed Ring looted the city of tens of millions before Thomas Nast's Harper's Weekly cartoons and the New York Times brought Boss Tweed down between 1871 and 1873. Democrats then leveled the same charge at southern Reconstruction governments — sometimes accurately, though those governments were building the South's first public school systems, hospitals, and railroads, and their spending was modest next to northern machines.

The Liberal Republican Revolt (1872)

Reform-minded Republicans — Carl Schurz, Charles Francis Adams, and editors including Horace Greeley and E. L. Godkin — broke with Grant. Their program:

• Civil-service reform to end the spoils system.
• Universal amnesty for ex-Confederates.
• Lower tariffs and hard money.
• An end to "bayonet rule" in the South — that is, to federal enforcement.

They nominated Greeley, and the Democrats, having no better option, endorsed him too. Grant won comfortably, 286 electoral votes to 66, and Greeley died weeks after the election. But the revolt did lasting damage: it made abandoning Reconstruction respectable among northern reformers, who now framed federal protection of Black southerners as corrupt cronyism rather than constitutional duty. Congress passed the Amnesty Act of 1872, restoring officeholding rights to all but a few hundred ex-Confederates.

The Panic of 1873

On September 18, 1873, Jay Cooke & Company — the firm that had financed the Union war effort — failed under the weight of Northern Pacific railroad bonds. The New York Stock Exchange closed for ten days. The depression that followed ran to about 1879, the longest contraction in American history to that point: roughly a quarter of railroads defaulted, thousands of businesses failed, and unemployment in industrial cities may have reached 25%.

The political consequences were immediate. Northern voters wanted jobs, currency policy, and railroad regulation, not southern civil rights. In the 1874 midterms, Democrats gained more than ninety House seats and took control of the House for the first time since 1858, ending any prospect of new enforcement legislation. Money questions — greenbacks versus resumption of specie payments — displaced Reconstruction as the organizing issue of national politics.

The Supreme Court Dismantles Enforcement

The judiciary completed the retreat.

Cruikshank is the decisive one. If Washington could not prosecute a private mob for massacring Black citizens, the Enforcement Acts were largely a dead letter, and the work of suppression passed safely to paramilitary groups such as the White League and the Red Shirts, which operated openly rather than in disguise.

The Civil Rights Act of 1875, Charles Sumner's last project, barred discrimination in inns, public conveyances, and theaters. It was rarely enforced and was struck down in the Civil Rights Cases of 1883.

Redemption

State by state, Democrats — calling themselves Redeemers — took back southern governments through a combination of violence, economic coercion, and northern indifference:

When Mississippi's Republican governor Adelbert Ames begged for federal troops in 1875, Grant's attorney general refused, relaying the president's own judgment that "the whole public are tired out with these annual autumnal outbreaks in the South." That sentence is the epitaph of Reconstruction. By the time the disputed election of 1876 was settled, only three states remained to be surrendered.