Profiteers rifle North

If money is the “sinewsof war,” as Cicero wrote, fraud schemes such as bid-rigging, bribery and embezzlement are the cancers that thwart victory. During the Civil War, corrupt contractors “shamelessly hurried to the assault on the Treasury, like a cloud of locusts,” Regis de Trobriand wrote in “Four Years With the Army of the Potomac.”

In the words of Col. Henry Olcott, a Union officer assigned to ferret out fraud: “Men there were by the hundred thousand, ready to take the field; but, to uniform them, cloth had to be woven, leather tanned, shoes, clothing, and caps manufactured. The canvas to shelter them had to be converted from the growing crop into fabrics.

“To arm them the warehouses and armories of Europe, as well as of this country, had to be ransacked. All considerations of business caution had to be subordinated to the imperious necessity for haste. If it was the golden hour of patriotism, so was it equally that of greed, and, as money was poured by the million, by the frugal, into the lap of the government, so was there a yellow Pactolus diverted by myriad streamlets into the pockets of scoundrels and robbers — official and otherwise. The public necessity was their opportunity, and they made use of it.” (The Pactolus River in Turkey, according to the Oxford English Dictionary, was famed in ancient times for its golden sands.)

All manner and means of fraud occurred during the Civil War, with the government stuck “paying ruinous prices.” In the East and North, most expenses were for manufactured items; in the West and Southwest, it was for animals, forage and transportation.

The U.S. government purchased an incredible array of goods, including food, clothes and medicines. The volume was equally staggering, as shown by this sample of a few 1863 purchases: 8 million flannel shirts and trousers, 7 million pair of stockings, 325,000 mess pans, 207,000 camp kettles, 13,000 drums and 14,830 fifes. For a six-month period in 1861, 1.9 million arms were purchased.

“The problem of the war was not men, but money,” wrote Ohio Sen. John Sherman (Gen. William T. Sherman’s brother) noting that annual war expenditures had reached nearly $1 billion. According to Olcott, that $1 billion was spent with “no organized system for the prevention and punishment of frauds.”

These massive expenditures raised international alarm and concern for America’s future. A London newspaper wrote: “National bankruptcy is not an agreeable prospect, but it is the only one presented by the existing state of American finance. Never before was the world dazzled by more reckless extravagance. Never before did a flourishing and prosperous state make such gigantic strides toward effecting its own ruin.”

However, President Lincoln knew things would improve eventually, according to Assistant Secretary of the Treasury Maunsell Field. Lincoln was visited by a delegation of bank presidents “at one of the gloomiest periods of the war, when depression and discouragement prevailed,” and was asked whether his confidence in the future was beginning to be shaken. In response, he recounted a fearful personal anecdote from years before and concluded by saying: “The world did not come to an end then, nor will the Union now!”

There were bounty jumpers who, after collecting a fee for enlisting, put on a disguise or went to another location to enlist again and, by so doing, collect another bounty. One peripatetic scammer enlisted multiple times on a single trip in New York State, thereby collecting bounties of several hundred dollars each time at Albany, Troy, Utica, Buffalo and Elmira.

Counterfeit currency was passed freely, and good luck to those who attempted to make a bid at any government auction. Conspirators often colluded to drive away competition by aggressively bidding to the level where prices became outrageous. By doing so, they made sure no unaware honest bidder would dare attend another auction. Smuggling was big business. Stephen Vincent Benet’s Pulitzer Prize-winning poem “John Brown’s Body,” included this verse:

Shadows sliding without a light,

Through the dark of the moon, in the dead of the night,

Hoops for the belle and guns for the fighter,

Guncotton, opium, bombs and tea.

Fashionplates, quinine and history.

Story Continues →

View Entire Story
blog comments powered by Disqus