“The world, after 1865,” Henry once wrote, “became a bankers’ world,” and he confessed without apology to finding “the banking mind… obnoxious.” The era’s omnipotent financier, J. P. Morgan, mastered the art of moneymaking, bringing industry, communication, and transportation into a vast empire of enterprises and trusts. One year older than Adams, the rotund Pierpont dominated the landscape of American business; his banking house, J. P. Morgan and Company (established in 1871), organized or underwrote dozens of firms and railroads, including General Electric, United States Steel, and American Telephone & Telegraph. More broadly, Morgan embodied a new monopolistic age in the nation’s economy, for which Henry accused him of “trying to swallow the sun.”1 Following the Civil War, a great industrial renaissance transpired, predicated upon the availability of land and labor, technology and capital. The opening of the West, freeing of southern slaves, and influx of immigrants mainly in the North all came together to make possible the continent’s commercial conquest. This process dominated, as Henry noted, “the world,” and its legacy remains to this day contested. Undeniably, the House of Morgan replaced the House of Adams as a historical focal point, embodying the ascendance of corporate consolidation over a waning political class.
Henry by no means stood alone in his skepticism of the period’s fluid political and moral mood. “The great cities reek,” Walt Whitman complained in 1871, “with… robbery and scoundrelism,” while the economist Henry George wrote in Progress and Poverty (1879), an influential study of inequality in the United States, “Where population is densest, wealth greatest, and the machinery of production and exchange most highly developed—we find the deepest poverty, the sharpest struggle for existence, and the most enforced idleness.”2 More than an American circumstance, this radically altered economic environment produced a series of dislocations encapsulated in the Panic of 1873, a financial crisis that first hit Europe and quickly spread to the United States, South Africa, the West Indies, and Australia. Prompted in part by rampant speculation in railroad stock, the downturn—lasting some six years in America, where it caused the bankruptcy of several thousand businesses—demonstrated conclusively the increasingly integrated nature of world markets.
Henry came of age during this profound process, eager to trace its impact on his family and his country. He took up the money question shortly after arriving in Washington, clearly interested in finance capitalism’s power to impose itself on both politics and culture. His earliest published work on the subject responded to the controversy surrounding the greenback dollars, the irredeemable paper currency made lawful by the Legal Tender Act of 1862. Regarded as a critical wartime measure to pay for the Union effort, the Act put over $400 million of greenbacks into circulation. Henry, a hard-money man like his father (who sternly declared any other kind of currency “gambling”), feared the inflationary potential of paper notes and began to focus his writing on monetary management. The fruits of these researches included “The Argument in the Legal Tender Case” (Nation, December 1868) and “American Finance, 1865–1869” (Edinburgh Review, April 1869). Combined with “The Session” and “Civil Service Reform,” his essays were beginning to attract notice in the nation’s capital. “So I come on,” he informed Gaskell with no little satisfaction, “and the people here are beginning to acknowledge me as some one to be considered.”3
A potent blend of pedigree and ripening talent brought Henry to the attention of those in a position to aid his diagnosis of American finance. The Adams name, if somewhat discounted, still counted for something—a convenience Henry happily acknowledged when deadpanning to Gaskell, “I… am held up solely by social position and a sharp tongue.” The sharp tongue made him a favorite of the reformers, for his essays were not merely lucid pieces, they were also decidedly pungent, devilishly cutting, and occasionally “wicked”—they flirted, that is, with borderline libelous descriptions of the principals he sought to skewer. The Grant administration did its best to mirror “an absolute despotism”; the public had “been robbed” by railroad directors Daniel Drew and Cornelius Vanderbilt; and New York Supreme Court judge George C. Barnard (subsequently impeached on various charges of corruption) paraded before his Tammany Hall paymasters with “a silken halter round the neck.”4 Rather quickly, Henry’s acidic brand of satire won its share of well-situated readers. Aside from political-minded literati, he counted congressmen and cabinet members among his connections and placed his work repeatedly in the respected Nation and North American Review. Perhaps he would never lay claim to the elected or appointed offices of his ancestors, but he could break new ground, forging a respectable Washington situation of his own.
On the topic of American finance, Francis A. Walker, a fellow Bay State reformer, proved an invaluable ally. Formerly chief of the Bureau of Statistics, Walker conducted and furnished for Adams the detailed research used in “The Legal Tender Act,” a scathing assessment of recent monetary policy published in the April 1870 North American Review. The timing of the essay proved auspicious. In February the U.S. Supreme Court had declared unconstitutional those parts of the 1862 Act permitting the use of greenbacks for payment of debts assumed before the Act became law. If not a sweeping condemnation of irredeemable paper money (currency made legal tender but not redeemable in gold or silver), the Court’s ruling nevertheless limited the scope of the Act and offered something of an entrée for Henry’s essay. The decision was sure to attract criticism in some quarters and “Legal Tender Act,” conceived by its author as an expository exercise, would now double as a defense of the Court’s findings. Armed with Walker’s statistics, Adams savored having a “big” topic all to himself. “I have been busy as a Roman flea in May,” he wrote Gaskell, “and have written a piece of intolerably impudent political abuse.”5
Avoiding empty pleasantries, the essay opens with a ringing condemnation of Congress. That body, Henry wrote, had organized countless committees of inquiry to scrutinize a lost Civil War battle here, a failed army strategy there, and yet it remained oblivious to a “disaster” whose “effects have extended far beyond the period of the war”—that calamity evident in the flood of greenbacks currently floating through the American economy. Casting about for blame, Henry proceeded to ridicule the men responsible for seeing the Act pass. Thaddeus Stevens, chairman of the House Committee on Ways and Means, merited special aspersion. Formerly the face of the congressional Reconstruction efforts that Adams believed unconstitutional, the Pennsylvania congressman once again came under Henry’s unsparing gaze. “That Mr. Stevens was as little suited to direct the economical policy of the country at a critical moment as a naked Indian from the plains to plan the architecture of St. Peter’s or to direct the construction of the Capital,” he caustically wrote, “expresses in no extreme language the degree of his unfitness.”6 Ignorant on the greenback question and more broadly bereft of any special knowledge or experience in matters of national revenue, Stevens all but handed his rather large chairman’s powers over to the champions of the Legal Tender Act, men who believed that only through the expansion of the country’s currency could the war be financed and the Union preserved.
One of them, Elbridge G. Spaulding, invited Henry’s particular spite. A former New York congressman and chief architect of the Act, Spaulding had recently authored History of the Legal Tender Paper Money Issued during the Great Rebellion (1869), a trenchant defense of currency policy during the war which, Spaulding insisted, was “indispensably necessary, and a most powerful instrumentality in saving the government and maintaining the national unity.” In reply, Adams resorted to name-calling, snobbishly describing the Buffalo-based Spaulding as “a provincial banker” who had learned his trade “shaving notes at a country bank.” Henry never accused Spaulding of malfeasance, but he thought the Act unnecessary and, in its augmentation of congressional power, detrimental. The government, he concluded, enjoyed two legal means to acquire finance: taxation and loans via the selling of bonds. In his opinion no financial emergency existed, and thus when “resorting to a forced paper circulation,” as he put it, Congress had overstepped its powers.7
Adams pointed out that in December 1861 Secretary of the Treasury Salmon P. Chase had briefly flirted with the idea of employing irredeemable paper money, only to quickly quash the idea. But soon after, a looming urgency for $1 million to continue running the government produced a crisis-like atmosphere in Washington. “The vague notion that sooner or later legal-tender paper was inevitable,” Henry observed, clinched the case in its favor.8 He acknowledged both the real need for the $1 million and the vast sums subsequently eaten up in the war effort, though he remained stubbornly insistent that the existing power of Congress to tax and sell bonds could raise the necessary funds. On this critical point he deferred to the judgment of James Gallatin, president of the Gallatin National Bank of the City of New York and the son of Albert Gallatin, secretary of the Treasury under Presidents Jefferson and Madison. James had testified during the legal tender debates of 1861–62 that the U.S. Treasury need only sell more bonds to meet its obligations. And who, Henry scoffed, was a mere Buffalo note shaver to argue with a Gallatin?
Uninterested in debating the fruits of family trees, Spaulding offered a rejoinder to Gallatin’s position, emphasizing the efficacy of legal tender to quickly provide the sums required by a war-pressed Congress. This logic led Henry to presume in “Legal Tender Act” that Spaulding conceded Gallatin’s point and simply put convenience above necessity. Believing his opponent bested, Adams subsequently referred to Spaulding as “a man whose scalp I took.” But it seems likely that in the winter of 1862, in the midst of a violent civil war only beginning to expand in its scope and intensity, Spaulding and other supporters of the Act regarded the turn toward greenbacks as very much a necessary prerequisite to victory. T. J. Stiles, the author of a recent Pulitzer Prize–winning biography of Cornelius Vanderbilt, has argued that Spaulding “performed a true miracle: he conjured money out of nothing, and so contributed more toward the Union victory… than any single battlefield victory.” Stiles goes on to contradict Henry’s claim that “absolutely no evidence proves that the government might not have carried the war to a successful conclusion without the issue of legal-tender paper.”9
As a rumination on American finance, “Legal Tender Act” proved to be something of a primer, for six months after its publication, Henry’s formidable essay “The New York Gold Conspiracy” appeared, though not in one of his customary outlets. The periodicals he typically patronized deemed the topic too hot to handle, a piece of libel looking to incite a lawsuit. Briefly, the essay took as its centerpiece “Black Friday,” September 24 of the previous year (1869), on which date the railroad developer and speculator Jay Gould and Wall Street financier James Fisk, with the aid of President Grant’s brother-in-law, Abel Rathbone Corbin, sixty-one and very recently and opportunistically married to the President’s thirty-seven-year-old spinster sister, Virginia Grant, sought to corner the New York Gold Exchange. When gold prices soared Grant realized the gambit at hand, which he countered by releasing some $4 million in government gold onto the market; many of the investors, though neither the nimble Gould nor Fisk, were wiped out. The episode riveted Henry’s attention to the rising power of finance capitalism in America. Since the end of the Civil War fresh markets, regions, and raw materials were opened to both development and exploitation. A spirit of garden-variety greed met with unparalleled opportunities to tempt investors, financiers, businessmen, and industrialists as never before. In writing up the drama of the gold battle, Henry more generally attacked the emerging corporate money culture and its sudden challenge to traditional values.
Initially concerned that Congress might “suppress the scandal” of the bullion run, involving as it did the president’s brother-in-law, Henry, to his surprise, discovered that he “soon knew all that was to be known” about the affair. Future president James A. Garfield, an Ohio congressman and chairman of the House Committee on Banking and Currency, led an inquiry into the “conspiracy” and, aside from the published report, offered other materials to Adams, whom he had befriended. Though Henry often moaned about his family’s lapsed status, he now enjoyed the independence to make contacts and publish criticisms that would have proven impossible had he held an elected or appointed office. His playful promise to Gaskell, “I am about to write an article on a very curious and melodramatic gold speculation… [and] it involves a good deal of libelous language,” is true enough and underlines the fact that, patrician instincts aside, Henry enjoyed a good (print) brawl, particularly when he considered his targets upstarts and arrivistes.10 Long before the investigative journalist Ida Tarbell published her famous attack on John D. Rockefeller’s oil empire, The History of the Stan-dard Oil Company (1904), Henry had already torn into the new money power. He proved to be both a blue blood and a muckraker, unwittingly helping to pioneer a profession that anticipated the progressive presidency of the Knickerbocker reformer Theodore Roosevelt.
Henry argued in “The New York Gold Conspiracy” that beyond Gould’s and Fisk’s rascality, the nation at large had quite promiscuously flung itself into the Stock Exchange. Anyone with a little cash, he somewhat exaggerated, from farmers and merchants to druggists and dentists, began to push dollars into the swollen market.
It seems that for Gould and company the “conspiracy” was less an inspired bit of buccaneering than the inevitable outcome of a country looking to make a killing, even if it meant buying on margin. And yet it humored Henry to assemble a host of questionable assumptions regarding the psychology and ethnic makeup of the major players involved in this failed caper. He tended, as noted, to personalize crusades. Appealing to the age’s casual anti-Semitism, he supposed, erroneously, that Gould betrayed “a trace of Jewish origin,” this fanciful detail apparently giving some insight into why the speculator “had not a conception of moral principle.” Adams simply dismissed Fisk as “noisy, boastful, [and] ignorant,” a shifty-eyed mercenary who resembled “a young butcher in appearance and mind.”11
These dark princes of finance, Henry continued, suddenly found themselves climbing in the new financial order, unexpectedly armed with unprecedented power. Their interests in the Erie Railway—connecting New York City to Chicago—alone set them above, in certain vital aspects, even the reach of government. Holding capital stock of some $35 million (roughly $700 million in current dollars) and employing fifteen thousand workers, the company, Henry argued, had set itself up as “an empire within a republic.” Who enjoyed more influence than the executives of this line? What mere king could claim the cash resources sitting in the company’s brimming coffers? With the national legislature and judiciary more than willing to abet the great financial titans and railroad barons, “Gould and Fisk,” Henry observed, “created a combination more powerful than any that ha[d] been controlled by mere private citizens in America or in Europe since society for self-protection established the supreme authority of the judicial name.” Such immense advantage in private hands disturbed Adams, who called it “far too great for public safety either in a democracy or in any other form of society.” Compounding matters, Gould and Fisk constituted a new type of power broker that Henry found especially distasteful. What could be worse, after all, than to cede authority to equivocal genealogies? “Both these men,” he sneered, “belonged to a low moral and social type.”12
Proud of the article, Henry described it many years later as part of his early oeuvre and, on those terms, “the best piece of work” he had done.13 And this raised the question, might Henry’s true literary gifts reside in the recovery of the past rather than in the micro-scrutinizing of modern Washington politics? His greatest labors—the nine-volume history of the early American republic, the Education, and his meditation on medievalism, Mont-Saint-Michel and Chartres—all point to their author’s talent for taking a small subject (a president, a private citizen, a song, or a cathedral) and connecting it to larger social, economic, and cultural forces. Accordingly, “The New York Gold Conspiracy” might be read as an apprentice piece for Adams’s more mature works. Clearly it displayed a distinctive historical voice.
Getting the essay published, however, proved difficult. Henry did more than offer a grand narrative of a failed gold conspiracy; he named names, and that made editors fear defamation suits. His hopes for finding a warmer reception among magazines outside of America also proved elusive; both the Edinburgh Review and (London) Quarterly Review declined the essay. One London editor, James Froude of Fraser’s Magazine, called the piece “prima facie actionable.” The article finally found a home in the influential left-leaning British quarterly Westminster Review, appearing in October 1870. The cautious publishers were right; to Henry’s delight the article made a lot of people mad. In separate communications to Gaskell, Adams boasted that Cyrus Field, the brother of David Dudley Field, attorney to Fisk and Gould, was “after” him, and that James McHenry, a British financier accused in the essay of advancing the gold scheme by planting a misleading article in the New York Times, “want[ed] to sue [him] for a libel.” Sure of his impeccable government sources, Henry declared himself eager to confront McHenry: “[A court case] would bring me over to England again as I mean to hurt him if he gives me a chance.”14
A year after publication, “The New York Gold Conspiracy” was reprinted, along with seven other articles, in Chapters of Erie: And Other Essays, a sort of omnibus of robber baron mischief. Henry authored most of the offerings, while his brother Charles, having given up law and now occupying a seat on the Massachusetts Board of Railroad Commissioners, contributed three studies on the chaotic struggle among financiers—including the ubiquitous Gould and Fisk—for control of the Erie Railway. Combined, the Adams men made the case that a rising plutocracy threatened to upend the republic. Not that such grave concerns kept Henry from enjoying Washington. Comfortable in his bachelor’s life, he circulated among cabinet members and power brokers, rapidly building a reputation as a formidable freelance journalist. That spring of 1870, with “Conspiracy” about to shame a slew of knaves, may have been one of the most satisfying seasons of his life.
As a reward for his recent literary labors, Henry left for England in May, eager to see Gaskell, visit London, and, so he said, take a “moral bath” after plunging into the brackish pool of American politics. All did not go as planned. A few weeks into his holiday Henry received disturbing news from the Continent that his sister Louisa lay seriously ill at Bagni di Lucca, a small commune in Tuscany known for its therapeutic thermal springs. Slightly injured in a carriage accident, Loo had subsequently contracted tetanus. Rushing to her sickroom, Henry could only witness the shocking end of her suffering. “It is all over,” he informed Gaskell on July 13. “My poor sister died this morning. I will tell you about it some day or other, but now I am fairly out of condition to write details. The last fortnight has been fearfully trying and the last few days terribly so.”15 Louisa received burial in Florence’s English Cemetery at Piazzale Donatello, resting place of the city’s Anglophone communities. Henry’s stabbing memory of Louisa’s last days, captured so graphically some thirty years later in the Education, is an admission that, beyond Grant and Gould, beyond even the omnipresent industrial dynamo, his distinctive fatalism could be partially traced to deeper and more personal losses: the death of a sister, the suicide of a wife. In such acutely felt tragedies did an already defensive and satirical exterior stiffen. Louisa’s alarming passing proved to be her brother’s first great blow:
He had never seen nature,—only her surface,—the sugar-coating that she shows to youth. Flung suddenly in his face, with the harsh brutality of chance, the terror of the blow stayed by him thenceforth for life, until repetition made it more than the will could struggle with; more than he could call on himself to bear. He found his sister, a woman of forty, as gay and brilliant in the terrors of lock-jaw as she had been in the careless fun of 1859, lying in bed in consequence of a miserable cab-accident that had bruised her foot. Hour by hour the muscles grew rigid, while the mind remained bright, until after ten days of fiendish torture she died in convulsions.16
In his grief Henry understandably failed to mention to Gaskell a letter that he had received some days prior to Louisa’s passing. The communication, from Harvard president Charles W. Eliot, invited him to accept an assistant professorship of history. On the third of July Henry wrote back, calling the offer “not only flattering but brilliant,” before tendering a polite refusal. He had a career or, as he put it to Eliot, an “experiment” just beginning and was “determined to go on in it as far as it [would] lead [him].”17 There is no evidence that he informed his family of the offer and most likely presumed the matter to be over. In fact, he remained vulnerable to parental appeal. The summer’s end would send him back to America, a reluctant professor, uncertain of what he might profess.