During the Crédit Mobilier of America scandal, the Union Pacific Railroad, the Crédit Mobilier of America construction company, politicians, and investors were entangled in a corrupt scheme to profit from the construction of the Transcontinental Railroad.
Credit Mobilier Scandal
The Credit Mobilier scandal shocked the nation during President Ulysses S. Grant’s administration. Here’s a comprehensive breakdown of its scandalous structure:
Key Players:
- Credit Mobilier of America: A construction company hired to build the Union Pacific Railroad.
- Union Pacific Railroad: A transcontinental railroad under construction.
- Oakes Ames: A Congressman and major stockholder in Credit Mobilier.
- Members of Congress: Several received bribes in the form of Credit Mobilier stock.
Modus Operandi:
- Credit Mobilier exaggerated the costs of building the Union Pacific Railroad, resulting in inflated government payments granted through congressional appropriations.
- Credit Mobilier then sold overpriced stock to Congressmen at a significant discount.
- Congressmen used their influence to approve further government subsidies, lining the pockets of Credit Mobilier shareholders.
Bribery and Corruption:
- Ames distributed Credit Mobilier stock to Congressmen at highly favorable rates.
- Members of Congress accepted these bribes in exchange for their support in allocating government funds to Union Pacific.
Consequences:
- Ames was expelled from Congress.
- Other Congressmen who accepted bribes were censured or reprimanded.
- The scandal tarnished the reputation of the Grant administration and fueled public distrust of government.
- It led to the passage of federal legislation prohibiting conflicts of interest and requiring more transparency in government contracting.
Chronology:
- 1864: Credit Mobilier was established.
- 1867-1869: Credit Mobilier constructed the Union Pacific Railroad with inflated costs.
- 1869: The Credit Mobilier scandal broke.
- 1872-1873: Congressional investigation and trials.
- 1876: Ames was expelled from Congress.
Table of Bribes and Recipients:
| Congressman | Credit Mobilier Stock |
|---|---|
| Oakes Ames | $50,000 |
| James Brooks | $40,000 |
| Henry Dawes | $20,000 |
Question: What was the Credit Mobilier Scandal?
Answer: The Credit Mobilier Scandal was a political bribery scandal in the United States during the 1870s. The scandal involved the Union Pacific Railroad and its subsidiary, the Credit Mobilier of America. The scandal revealed that Union Pacific executives had secretly awarded themselves inflated contracts through Credit Mobilier, and then used those profits to bribe members of Congress to vote in favor of the railroad’s interests.
Question: What were the consequences of the Credit Mobilier Scandal?
Answer: The Credit Mobilier Scandal led to the resignation of Vice President Schuyler Colfax, and the censure of several members of Congress. The scandal also contributed to the waning popularity of President Ulysses S. Grant, and the Republican Party.
Question: How did the Credit Mobilier Scandal affect public trust in government?
Answer: The Credit Mobilier Scandal had a devastating effect on public trust in the government. The scandal revealed widespread corruption and self-dealing among elected officials, and led many Americans to question the integrity of the political system.
Alright folks, that’s all for our little history lesson on the Credit Mobilier scandal. Remember, it’s not just about the dirty politicians and shady dealings; it’s a reminder that even the most powerful people can be held accountable for their actions. Keep that in mind next time you’re tempted to pull a fast one. Thanks for hanging out with me today, and don’t be a stranger! I’ll be back with more juicy historical tidbits soon.