President McKinley

by Robert W. Merry

  The Chicago newspaperman had been mildly problematical during Charles Dawes’s campaign to collect Illinois convention delegates. Kohlsaat’s Chicago Times-Herald had supported McKinley avidly but also had promoted the gold standard with such zeal that it created confusion about the candidate’s true currency stance. When Mark Hanna was asked who represented McKinley on the money issue, himself or the Times-Herald, the industrialist often replied, “Kohlsaat is a crank and does not represent anybody but himself.” These comments inevitably got back to Kohlsaat, and the two men, though friends for years, stopped talking because of the frictions over currency.

  Whatever Kohlsaat said during his Canton visit, McKinley wasn’t buying it. He retorted that 90 percent of his correspondence and visitors cautioned that a strong gold plank would spell his general election defeat. One alarmist was the prominent party man Whitelaw Reid, owner and publisher of the New York Tribune, who had run for vice president with Benjamin Harrison during Harrison’s unsuccessful 1892 reelection bid. “If a gold plank is adopted,” the often officious Reid had warned McKinley during a recent Canton visit, “we will not carry a State west of the Mississippi.” Reid’s Tribune echoed that view in an editorial: “There is no occasion to maintain that the words ‘Gold Standard’ must of necessity be used, because the present standard is that, and everybody knows it.” The aim was to avoid the word gold in the platform and thus keep the political waters calm. As Edwin Godkin’s Nation magazine put it, McKinley was less a silver man than a “silverish man,” meaning he “wishes to be considered ‘friendly to silver’—just friendly enough to get the votes of the silver men, but not friendly enough to lose those of the gold men.”

  Besides, McKinley still didn’t think the currency controversy could possibly supplant protectionism as the campaign’s leading issue. While he acknowledged that Western and Southern passions over money would have to be managed during the convention, he told Kohlsaat that those passions would dissipate within a month—so long as he didn’t exacerbate the situation by fostering a strong gold plank.

  This outlook reflected McKinley’s tendency to view political events in static terms—seeing things as they were and assuming they would continue in the same vein. Dynamic thinking wasn’t his forte. Though deft in responding to events as they unfolded, he lacked an instinct for anticipating them, much less shaping them. Thus, as the convention loomed, he didn’t see the potency of the silver issue. Indeed he didn’t want to see it. If he embraced gold as a push-back on the rising silver sentiment, it would amount to an acknowledgment that the money issue was now the campaign centerpiece. Once again Godkin got it right. “The fight that the McKinley men are making at St. Louis,” explained The Nation, “is not so much against the gold standard as it is against giving precedence to the gold standard as an issue.”

  A few days after his Canton visit, Kohlsaat got a telegram from a Chicago friend named Alexander Revel, who had traveled to St. Louis for the convention. “If you want to see the word ‘gold’ in the plank,” wrote Revel, “you should come down here.” Kohlsaat quickly caught an overnight train to St. Louis, arriving at ten on the morning of Friday, June 12. He went straight to McKinley’s Southern Hotel headquarters, where a number of McKinley’s friends were vigorously engaged in fashioning a currency plank. Kohlsaat promptly inserted himself into the deliberations.

  Those deliberations unfolded against a backdrop of America’s long and often unsuccessful effort to maintain equilibrium between the demand for money and its supply, an effort that extended back to the controversy unleashed by Hamilton’s First Bank of the United States, designed to give the economy sufficient liquidity, maintain currency stability, and ensure economic efficiency. Jefferson and his Republican allies attacked the bank as a dangerous concentration of financial power, and its charter lapsed in 1811. But the War of 1812 revealed the need for a central banking authority. State banks in the Northeast, where the war was unpopular, hoarded the country’s meager reserves of specie (gold and silver), forcing banks in other regions to rely on printed money. The result was a menacing wave of inflation and considerable economic dislocation. Thus the Second Bank of the United States was established in 1816—and immediately slipped into corruption as its officials speculated in the bank’s stock and fostered venal practices by its branch members. When new bank leaders sought to clean up the mess by foreclosing on overdue mortgages and redeeming overextended notes from state banks, they triggered the Panic of 1819. Banks failed, prices collapsed, unemployment soared.

  President Andrew Jackson, a sound-money man who hated all concentrations of power, killed the national bank with a series of bold and highly controversial political maneuvers in the 1830s. But the state banks he fostered couldn’t always maintain the needed balance between money demand and money supply, and that proved disastrous when the Panic of 1837 ravaged the U.S. economy for nearly seven years. An anguished call rose up for rescinding Jackson’s last executive action, his Specie Circular, designed to curb a dangerous inflationary wave sweeping the country in conjunction with wild land speculations in the West. Jackson’s answer was to require purchases of government property to be transacted in gold or silver.

  But when the threat of inflation suddenly gave way to the threat of falling prices, or deflation, Jackson’s protégé and chosen successor, New York’s Martin Van Buren, couldn’t see that the Specie Circular was precisely the wrong medicine when the country desperately needed liquidity. In the name of a sound currency, he clung to Jackson’s old policy even as it deepened the Panic and destroyed his presidency in the 1840 elections.

  Something similar was happening now, in the 1890s, when a deflationary cycle emerged after the Western land-price bubble burst and surging grain production devastated farm prices. As the silverites saw it, declining prices meant there weren’t enough dollars to accommodate the demand for goods. In farm regions, they argued, the money supply hadn’t kept up with the burgeoning production of wheat and other agricultural products. The answer was to expand the money supply through the coinage of silver. As a fiery young Democratic congressman from Nebraska, William Jennings Bryan, declared in 1893, “Mr. Speaker; if metallic money is sound money, then we who insist upon a base broad enough to support a currency redeemable in coin on demand, are the real friends of sound money.” On the other hand, he added, “If all the currency is built upon the small basis of gold those who hold the gold will be the masters of the situation.”

  Gold advocates countered the call for more liquidity by noting that the nation’s money supply had increased by 240 percent since 1860 and 104 percent since 1872, much faster than the rise in population. They pointed out further that global gold production had increased substantially in previous years, bolstering the money supply throughout the world. In a series of explanations entitled “The Free Coinage Catechism,” Godkin’s Nation argued that the price of wheat, for example, reflected the supply-and-demand ratio on wheat itself and had nothing to do with any money-supply shortage, which was nonexistent anyway. An artificial increase in money, argued the magazine, would merely unleash a wave of inflation, and the wheat farmer’s added revenue from higher wheat prices would be offset by higher prices on everything he had to buy to live and produce. Thus “the farmer would be relatively no better off than he was before.”

  All this established the framework for a political drama about to unfold at the Republican convention. As those McKinley associates grappled with the issue at the Southern Hotel, their basis of discussion was a document crafted in Canton by McKinley and others and hand-carried by Hanna to St. Louis the previous Wednesday. A copy was delivered to Senator Foraker as well, who was slated to be on the convention’s platform-writing Resolutions Committee and thus would be well positioned to get the governor’s favored language into the final document.

  The crucial elements of the McKinley draft stated that the party favored sound money “unreservedly” and opposed any effort “to debase our currency or disturb our credit.” The par
ty had been responsible for resuming specie payments in 1879, after Civil War greenbacks had flooded the country, and since then had “kept every dollar as good as gold.” It was committed to “maintaining all the money of the United States, whether gold, silver or paper, at par with the best money of the world.” It had no objection to silver so long as it could be maintained at parity with gold and if other major trading countries would enter into an international bimetallism agreement based on an equality of value between the two metals. Until then, “it is the plain duty of the United States to maintain our present standard, and we are therefore opposed under existing conditions to the free and unlimited coinage of silver at [a ratio of] sixteen to one.”

  Given his previous conversation with McKinley, Kohlsaat considered the language much stronger than he had anticipated. It appears that the governor had stiffened his gold commitment after Kohlsaat’s departure. Others sensed the same thing. The New York Sun, after talking with an anonymous inside source, reported that “the drift at present is toward a very much better money plank than was anticipated two or three weeks ago.” The paper added, with a touch of malice, that “Mr. McKinley has been screwed up [by his friends] to a stronger idea on the money question.” It isn’t clear how McKinley reached acceptance of this draft wordage, but it seems his aim was to balance the political pressures from both Western silver men and Eastern gold interests. His model was language crafted by the Ohio state party and the Indiana GOP convention. Both were seen as political “straddles”—supporting the principle of a sound currency while avoiding any specific mention of gold.

  While McKinley’s friends in St. Louis—including William Osborne, Myron Herrick, and Senator Redfield Proctor of Vermont—favored the Eastern position, they weren’t sure it would be politically prudent to reflect that sentiment in the platform with explicit language, including the word gold. At Hanna’s request, on Thursday these men set about to refine the language by scrutinizing every sentence, clause, and word. Hanna was in and out of these sessions, as his broader managerial duties called him away intermittently. But he seemed to favor the McKinley straddle.

  In truth, he strongly favored the gold standard and believed the wave of angry Western populism had to be met with a stern political counterforce. But his job was to get McKinley nominated, and it was crucial that he keep his candidate out of any crossfire between the two emotional currency factions. Better, he believed, to let the pro-gold sentiment build among delegates before aligning McKinley with the gold forces. In the meantime, he would stay in the shadows and certainly keep his candidate there.

  On Friday some new people joined the St. Louis discussion group: Kohlsaat; Henry C. Payne of Wisconsin, a Milwaukee machine politician who served as a Republican committeeman from his state; former Minnesota governor William Merriam; and Melville E. Stone of Chicago, head of the Associated Press and a close McKinley friend. When Kohlsaat saw the latest draft on Friday morning, he noticed that the word gold had been inserted between existing and standard, thus binding the party to the principle that “the existing gold standard must be maintained.” But the crucial word had been crossed out in the typewritten draft, signifying that the group hadn’t yet agreed to go the distance. When Kohlsaat asked about it, Hanna said the word had been excised because of strong objections from Indiana, Michigan, Iowa, Nebraska, and other states west of the Mississippi, where McKinley delegates were needed for the nomination.

  When Kohlsaat ventured that avoiding the word was “cowardice,” Hanna exploded.

  “Damn you, Herman,” he declared, “haven’t you any compromise in your make-up?”

  “Not on this issue, Mark,” replied Kohlsaat.

  “Well,” said Hanna, “I have no more time to waste on a damned crank.” And he left the room.

  The conferees debated the matter for the next five hours, finally reaching agreement at three o’clock in favor of the explicit gold commitment. They sent for Hanna and informed him of the decision. The campaign manager looked straight at Kohlsaat.

  “Are you satisfied now, you damned crank?” he asked.

  “Yes,” replied Kohlsaat. “I don’t like the promise to send a commission to Europe to work for bimetallism, but will stand for it.”

  As the exhausted group was breaking up, Hanna called Kohlsaat into his room. Clasping the newspaperman’s hands in both of his, he said, “You probably have noticed I have dropped you entirely for a couple of months. Well, I want to tell you I am just as strong a gold-man as you are, but if I had been as outspoken as you we would not have gotten the votes for McKinley, but I want you to know I love you just as much as ever.” The friendship continued for years.

  Later on Friday, Herrick wired the draft to McKinley, who by now was convinced of the need for a strong statement. He wired back his approval via the telegraph machine in his Canton study. But Hanna wasn’t ready to reveal the status of things before he could assess convention sentiment, and that would take a couple days as delegates arrived in St. Louis. Among them were two particularly important Easterners with fervent pro-gold convictions: New York’s Thomas Platt and Massachusetts senator Henry Cabot Lodge, a brilliant but haughty Yankee with a romantic vision of America’s destiny and a streak of “dauntless intolerance,” as one observer admiringly put it. Lodge arrived bent on forcing the word gold into the currency plank by whatever means necessary.

  On Monday he marched into Hanna’s office and, without any preliminary greeting despite its being the first time the two men had met, announced, “Mr. Hanna, I insist on a positive declaration for a gold-standard plank in the platform.” Hanna looked up from his desk.

  “Who the hell are you?” he demanded.

  “Senator Henry Cabot Lodge, of Massachusetts.”

  “Well, Senator Henry Cabot Lodge, of Massachusetts,” said Hanna, “you can go plumb to hell. You have nothing to say about it.”

  “All right, sir,” said Lodge, unfazed, “I will make my fight on the floor of the convention.” And he departed.

  It was precisely what Hanna wanted: convention rumors that the Eastern gold men were marshaling their forces to take over the drafting of the currency plank. When Hanna’s quiet delegate soundings revealed widespread convention support for a firm gold plank, the campaign manager decided it was time to drop his secrecy tactic. He sent Merriam to deliver the final McKinley draft to Platt, while Kohlsaat showed a copy to Lodge. The senator evinced surprise. “Why, that plank is all right,” he declared, then suggested a couple of minor improvements that were readily accepted. Merriam, a member of the Resolutions Committee, delivered a copy to Foraker, who had become chairman of the platform-writing panel, ensuring his influence over the final language.

  As word seeped out about the strong gold plank, many concluded McKinley and Hanna had been rolled on the issue. The Washington Post, which had been predicting for days that the currency plank would be a straddle, now presented a totally different picture. “Hanna Yields to Lodge,” declared a Post headline. It wasn’t true, but it served Hanna nicely. The Western silver men might not like where the convention was going, but they couldn’t blame the man in Canton, who was widely viewed as more sympathetic to their interests than the convention seemed to be. Hanna later wrote to a friend, “The whole thing was managed in order to succeed in getting what we got, and that was my only interest.”

  What induced McKinley to move from his rigid support for the gold-plank “straddle,” as reflected in his intransigent response to Kohlsaat, to his final acceptance of the strong gold position? No one ever knew, because he never explained it. Once again the mysterious politician managed to position himself—and, in this instance, his party—where they needed to be for maximum political effectiveness. The governor wasn’t quite prepared to embrace the gold standard as his centerpiece position in the general election, but now he could do so if political circumstances should require it, which they would. Once again he managed to preserve his flexibility on a hazardous issue while remaining entirely out of the poli
tical crossfire.

  * * *

  WITH THE CURRENCY plank settled and hardly any doubt about the nominee, the St. Louis meeting figured to be a convention of rare serenity and good feeling, though many no doubt would lament the lack of the usual dramatics. In the days preceding the first gavel, other candidates maneuvered to accommodate reality. On June 8 Shelby Cullom abandoned his presidential ambition in favor of McKinley. “There’s no use keeping up your holler when the thing’s settled,” he said. Matthew Quay’s situation was more complicated. Given that he already had accepted McKinley’s inevitability, it was natural for him to withdraw. But in entering the combine of bosses the previous year, he had promised to keep fighting to the end, and he didn’t want to renege on his commitment. Mr. Quay, wrote the Washington Post, “is in a somewhat embarrassing position.”

  His close collaborator, Thomas Platt, faced no such dilemma. Having established his battle lines, he would never retreat. He intended to fly the Levi Morton flag into the nomination balloting and be positioned for any eventuality that could undermine McKinley’s standing with delegates. Unfortunately for him, nothing seemed likely to upend McKinley except a raucous convention split over the currency plank, and Hanna had deftly eliminated that threat. So Platt’s defiance was mostly for show, although it occurred to him that perhaps a respectable Morton showing could get the vice presidential nod for the New Yorker, which could enhance Platt’s control over New York patronage.

  That left Thomas Reed. Although his plan to capture New England was bruised, he entered the convention with enough delegates to be a factor should lightning strike. But then his top campaign official, Joseph Manley, arrived in St. Louis and declared McKinley the winner. “In my judgment the convention will nominate Gov. McKinley on the first ballot,” he said in a statement. “It is useless to attempt to deny that this will be the result.” It was a stunning statement from a man who owed his devotion to Reed. Around the convention hotels, folks were even more stunned to learn that Manley had neglected to tell Reed about his planned statement but for some reason had alerted Hanna. When reporters told Reed of Manley’s prediction, he exclaimed, “No, sir; it is not true! Manley would have made no such statement.” Many figured that Manley’s action would cost Reed half his delegates.